Obama’s ransom diplomacy

When Iran freed five American hostages in January, President Obama was hailed by many in the mainstream media for his skillful diplomacy. However, more sober analysts, most notably Arthur Herman, wondered whether the Obama administration had, in effect, paid a ransom for the release of the Americans.

The sense that this was a gussied up case of ransom payment, rather than clever diplomacy, arose not from the $100 billion or so that Team Obama had bestowed on the mullahs through the nuclear deal. By January, this was, effectively, a sunk cost.

Rather, the ransom narrative was fueled by a new sweetener — a $1.7 billion settlement on claims relating to the sale of military equipment to Iran before the 1979 revolution, in the time of the Shah. This claim was for $400 million, the amount of money in a trust fund the U.S. apparently seized. The $1.7 billion settlement includes $1.3 billion in “interest.”

Rep. Mike Pompeo immediately voiced his concern about the payment. In a letter to Secretary of State John Kerry, he asked: “What is the relationship between the $1.7 billion payment and the release of the hostages?” Pompeo also noted that at least one top Iranian official had described the payment as “a bid to buy freedom of [U.S.] spies held by Tehran”.

It took the State Department two months to reply. And the reply came not from Kerry, but from an assistant secretary for legislative affairs.

Herman describes the State Department’s letter as “a masterpiece of prevarication, obfuscation, and devious misdirection — and a revealing example of how the Obama administration not only treats Congress but systematically evades responsibility for its own actions.” It attempts to blame the payment on President Reagan, who in 1981 agreed to the creation of the Iran–U.S. Claims Tribunal at The Hague.

Reagan’s goal was to set up a mechanism through which American nationals, especially the hostages seized by Iran, might one day receive compensation. Not surprisingly, there has been no compensation from Iran.

Iran has sought to use the Iran-U.S. Claims Tribunal to vindicate its claim, among others, that the U.S. owes Iran $400 million plus interest in connection with arms transactions with the Shah. As with compensation for the hostage taking, this claim has gone nowhere.

But suddenly, Obama agreed to pay the mullahs $1.7 billion without any formal decision by the Tribunal. Why?

According to Herman, the letter doesn’t dispute that the U.S. did so in exchange for the release of hostages. Given the timing of the payment, and the letter’s acknowledgement that the payment was made in a behind-closed-doors settlement as a way to avoid letting the Tribunal formally decide the case, the connection is clear.

Iran has additional claims before the Tribunal. It also has additional American hostages, Robert Levinson and Siamak Namazi (Iran claims not to know where Levinson is). Thus, we should probably expect additional ransom payments by Obama.

Bowing to and enriching dictators is what passes for American diplomacy in the Age of Obama. It’s the only kind the president is good at.