Getting tougher on Iran

By Bob Casey

and Sam Brownback

President Obama recently announced that Iran has been secretly constructing a nuclear facility south of Tehran. Sadly, this revelation was not surprising, given that the Iranian regime has spent years lying about its nuclear program, sponsoring terrorism, and oppressing its own citizens. Whatever one thinks about the prospects of diplomacy, it's time for tougher measures to constrain the regime's ability to acquire weapons of mass destruction before it's too late.

One promising approach is targeted divestment from Iran's energy sector. Analysts have estimated that the country requires $20 billion a year in investments in its oil and natural gas sector, which is increasingly dominated by the innermost operatives of the regime. Currently, dozens of corporations around the world cover these investments, which provide crucial funding streams for Iran's nuclear program and its support for terrorism. Furthermore, the regime's recent bloody postelection crackdown and widespread censorship suggest a massive - and costly - apparatus for domestic repression.

Because of the regime's stubborn commitment to these dangerous and belligerent activities, doing business in Iran is an increasingly risky proposition. Due to existing sanctions, credit restrictions, and other international efforts, pension-fund managers are taking extraordinarily high risks with people's money if they invest it in Iran. Moreover, there can be little doubt that the regime will cease its destructive behavior only when it is compelled to pay an economic price for it.

To avoid aiding the regime and to protect against risky investments, 18 states have passed legislation divesting state pension funds from companies that invest in Iran's energy sector. Pension funds can replace these companies in their portfolios with those that engage in legitimate business without hurting the performance of the funds.

Modeled after a similar movement that responded to the genocide in Sudan, the Iran divestment movement has gained momentum. But it still lacks one key element.

In passing divestment laws, state governments are operating in a legal fog, unsure if the laws will get struck down under the doctrine of federal preemption. To address that, we introduced the Iran Sanctions Enabling Act in the Senate in May. This bipartisan bill, which has 34 cosponsors, would grant federal authority and provide guidelines for states to divest from Iran's energy sector. It would also provide safe harbor for fund managers to carry out divestment without fear of being sued.

In the previous Congress, then-Sen. Barack Obama joined us in introducing similar legislation. He was right then, and he would be right now to sign this bill into law if it's approved by Congress.

We are entering a new phase in President Obama's strategy of engagement with the regime in Tehran. On Oct. 1, Iranian officials met with representatives of several major powers, with both sides agreeing to hold further negotiations. But Iran's history of concealing nuclear facilities should serve as a guide for what we can expect from this regime.

The regime needs to understand that noncompliance has consequences. Congress and the president should act swiftly to pass divestment legislation so that state and local governments can move ahead with efforts to slow the march of Iranian aggression.