original program would be restricted to mutually agreed parameters consistent with practical needs. judging what iran's practical needs are is in the eye of the be holder. .. to 20 plants believes will be

vastly expanded nuclear enrichment program in their country even if it is under tight safeguards. >> your point is very well taken, senator. as i said, nothing is agreed to until everything is agreed to the practical needs are an element of comprehensive agreement, but so are our concerns about their ability to have nuclear weapons, which is primary that they not obtain a nuclear weapon. and so whatever the final agreement is, that is the assurance that its utmost that t important. >> but again if they build ten new nuclear power plant that would be a vast program they would havtheywould have to havee complications of monitoring such a program would be exponentially greater and i just think that we have to keep that in mind going forward because that is how they would actually crack the inspections regime in the years ahead even if we got the comprehensive agreement. and finally, since the november

agreement have you seen the signs of the uptick for the proxies and allies around the middle east and the reason to believe that iranians believe they have a leeway to be more aggressively in the region because of the agreement that has been reached on the nuclear program and the interim basis? >> i think it would be valuable to have our intelligence community give you an assessment on that question because we have asked that question. i would point out that there was concern by many that they would take the first payment of $550 million a cycl cycled intot for hezbollah in syria. that doesn't appear to be the case and i would be glad to give you a briefing on that, but i think you have seen in the news that iran has visibly provided food to those in their societies that are poor as a way of demonstrating quite directly

that this limited, targeted and sanctions relief has a direct impact on the people in the country which is what precedent rouhani promised wasn't used for other purposes. >> senator shaheen has raised this for other executives to explore other economic openings and the same is true for russia, germany and china. i think it's important for our administration to say to each of these countries that if there is no comprehensive agreement that's not only is the window going to be shot on the trade and the united states is going to sanction that are going to cut deals, but additional sanctions will be put in place and additional action will also perhaps have to be taken in order to make sure there is no nuclear program. and i think an explicit

statement of that would be very reassuring to people just tune out there will be no games that are going to be allowed by any of these businessmen and that there will be punishment by the u.s. government. >> i was just briefly say that this is precisely the message that has been conveyed in the engagement that we have had over the last several weeks. there will be no wavering in the enforcement of the sanctions. and also, we have made the point that if a comprehensive deal is not reached, if for instance iran feels that it doesn't need to reach a comprehensive deal because they can get sanctions relief through other means trying to develop these sort of business activities that the net consequence of that and all of these business is is going to be to their detriment. it will be much worse than what they face today. and i think that message is

getting across. >> let me thank you both for your testimony and engagement. i will have a series of questions for the record including my understanding on the release of oil purchases, countries may in fact purchase more than the last reduced amount. i would like to understand how we are working on it. secretary cohen, i will be watching your actions. with that, thanks to the committee. you're both excused. >> searcher ma'am, thank you. mr. corker and other members of the committee thank you for inviting me. the joint plan of action has significant benefits in the short run but the success remains uncertain pending the negotiations on a long-term arrangement and finally, the text of the joint plan of actions will be in negotiating the long-term arrangements. a process president obama gets a 50/50 chance of success and it has been made clear although i

would state again the agreement must create limits on iran's nuclear program combined with adequate verification sufficient to ensure any attempt by iran to build nuclear weapons would be detected in a timely manner and provide time for a night international response. i would like to briefly say two things about the interim agreement. one is i would like to at least say that it does accomplish certain things. one of the benefits is that it avoids the situation that was becoming very dangerous. mainly iran moving towards a very short break out of time. and i so, it also adds to the clock as others have mentioned that it's the combination of those two things that needs to be pointed out. but as others have stated, the agreement does have the gap. thank you for mentioning that

earlier mr. charan. another one i would like to mention is iran continues to listen to document activities. it's dependent on outside supply for the centrifuge program for the reactor and those cannot continue and it's essentially a gap in the deal that cannot be avoided. and there's other problems with it. so it is a short term deal that it should not be looked upon as something that should be extended and if it is extended beyond six months, iran should demonstrate its made concessions by that point and it's not just letting the clock run and they've reached six months and it's just automatically extend extended. i think i will skip over and the committee understands better than most the absolute need to address the concerns about the past and possibly ongoing nuclear weapons programs and i

think it's very important that the administration continue to stick to the policy that there will be no comprehensive solution of the concerns are not addressed in a very significant way. >> on the comprehensive solution itself, there are two issues involved. one is at a quick or quick detection or detection before iran builds a nuclear weapon. but i think post the debate on syria, there has to be enough time for an international response, whatever that's going to be. and i would add four or five years from now one cannot expect any administration to have their finger on the trigger that whatever is put in place on the comprehensive solution helps to provide an adequate warnings of the military options by the united states are not necessary.

buthere has to be enough time so that they are truly can be an international response that would stop iran and if the international response includes military action as it was in the lead up to the war in 1991, the united states wasn't having to act unilaterally. in such a complete and that solution, i think we talked a lot about the breakout times. we briefly put out a model comprehensive solution which is available on the website where we think the breakout times have to be six to 12 months, but there are many other parts of this that need to be done. one is that it's a stockpile of the low enriched uranium and whatever form it's in is much too large for the comprehensive solution. having had up to 300 kilograms equivalent of near 20% of the low enriched uranium is not good even if all of that hexafluoride material has been turned it can

be converted. it's important to block a nuclear weapon and i think that there is a greater agreement on that at the reactor needs to shut down and we would say be upgraded to the reactor. but iran has not accepted that at all. we also believe that there is a lot of work that is needed to develop constraint or provisions to limit or reduce the ability to build secret facilities to enrich uranium or separate plutonium. also they need to commit to stopping the procurement of goods for the nuclear program. but that's often shuttled aside as it was in the interim agreement but it's critical in the comprehensive solution that iran would connect to do that and that would be verified. and again i think that we believe that the duration of these constraints needs to be 20 years. others have suggested even longer. and also we would argue the

additional protocol by itself is not sufficient. there has to be additional protocol plus that ads in several actions and some of these actions were used in 2003 and 2004 during the period of suspension to get to the bottom of some of the duplicity of ir iran. i would also like to point out that even the comprehensive solution there is more work that needs to be done when the constraint ends. let's say it is after 20 years all of the constraints just remove and iran is free. to pursue an enrichment program that would allocate 20 large commercial power reactors are we going to feel comfortable even then? and i would plan out if such a program in the calculations that we have to would involve 2 million centrifuges so there

is a need as a last comment and i apologize for going over for the united states to be very clear that it wants a limited program and that while it's talking about 20 years, the constraints would only come off after the set of criteria match to guarantee that iran will not develop nuclear weapons after that time. >> i look forward to your testimony which i have read is very important and i look forward to the q-and-a to flush out the nature. >> thank you chairman menendez and members of the committee for inviting me to testify. it's an honor to testify alongside david albright. you've heard the argument the official said very clearly iran is not open for business meanwhile to be the head of the nuclear program sending the opposite message including at

davos most recently. the sanctions architecture that you put in place is not going to a road and president obama claimed it isn't going to be hard to turn the dial back or strengthen the sanctions even further. while regrettably i think the administration made the miscalculating we are already seeing the early stages of the shift in the market sentiment. this is something that is unintentional but predictably triggered. it's estimated by the administration that $7 billion that may not sound like a lot come of it prior to the agreement it's important to understand that iran had a fully accessible cash reserve of $20 million that an infusion therefore represents a 35% of the reserve. moreover, $7 billion number does not account for the psychological impact of the market sentiment. sanctions are predicated upon the strategy of escalation where an ever-expanding restriction spooks before and businesses.

as the companies view iran as literally an economic minefield. but the tide is starting to turn. while they block the sanctions in the legislation it provides the sanctions relief in the key sectors of the economy like energy, automotive, petrochemical, metals and aviation and this sends the message that the economy is opening up. the changes sparked the beginning of a modest tentative albeit fragile recovery demonstrated by the key economic indicators and the facts so let's review this. the gdp dropped by 4.5% to 2013 when the toughest sanctions hit. the world bank now estimates of gdp will increase by about 5% to 2016. the weathervane for the house of the economy dropped by almost 75% between 2010 and 2012 but it's increased by 40% since the

election and it's increased 18% since the announcement of the delay. there's been a dramatic drop in inflation from the official rate of 40% and the unofficial rate of over 60% in 2012 to a much more manageable rate of 20% and falling. it is reflected in the confidence and has almost doubled. we tal talk of the trade obligas that have gone from europe and "the new york times" have been more than the first two weeks and 2014. they pledge to increase bilateral trade with iran to $30 billion by 2015. and they are already flocking back to the sector that is an object of some relief. it contributes 700,000 jobs at almost $50 billion to the economy an and the second larget sector in iran after energy. petrochemical sanctions opens up even greater opportunity for the

sector that before the gpo a. and the suspension of the reduction is taking pressure off of the oil sector which would endanger the irreparable losses. it will have revenues that otherwise it would have lost over the next six months. we talked about the deal and thatcher shaheen you're right it's an 18 billion-dollar oil for a good deal. iit's maybe more if it is exploited as an illicit finance scheme. without adequate administration enforcement.

we are hearing from sources that iran may be using gold to actually finance the war in syria and this may be again and intended consequences of overlapping precious metal sanctions. what signal does it send to others and it is open for business by blocking the eighth 1881 which would have lent credibility for the administration's message to help reverse the market. however the concern in the top sanctions that would have worked today is in six to 12 months if it is on pace for the sustained economic recovery and if it is made progress on the nuclear weapon missile development and if the leaders are unwilling to conclude an acceptable deal. then they need to impose a comprehensive and financial trade embargo within weeks to

stop the nuclear weapons breakout capability. congress needs to prevent them from engaging in endless negotiations and legislate parameters and a strict timeline for a nuclear deal. that work needs to begin immediately at the administration. thank you for inviting me to testify. i look forward to exploring with you the value and the consequences of the sanctions that i read in your testimony. the committee will stand briefly in recess to conduct a business meeting and then we will turn immediately afterwards and i thank the panel for their patience it'patients it's an iny important topic on the committee that your testimony is important as a part of the record. the committee stands in recess to the call of the chair. let me thank you both we appreciate your willingness to

hang in there with us. you have a lot in your testimony i hope people will read the testimony some of it is technical in nature and i plowed through it. not an expert but i plowed through it. i think it's incredibly important to understand because what adl ends up being that we can support depends upon what it is. let me ask you some questions to further elucidate the record in your testimony. is there a way to significantly set the clock backwards as using a metaphor on the nuclear weapons capability without closing, without significantly dismantling the centrifuges? >> i don't believe so. at the heart of this is the need

to significantly reduce the centrifuge program and i think with the reactor being part of the plutonium route you are confronted with the need to shut that down. it can be converted to something else, but the way that it designed according to the earlier declarations, and we don't know the final detailed design, they haven't provided that the international atomic energy agency yet. but it is best configured to make the weapons grade plutonium and you don't want them to have such a reactor. >> they could have won at richmond side. >> from our analyst as it uses the verification and it removes the site not invincible but it gives a sense that they could withstand the military strike and not have a number of centrifuges down that hole destroyed.

>> i had a question why you would bury deep in the mountain be in richmond side if your purpose is for the civilian nuclear energy. >> there's a lot of suspicion that it was originally designed to be a site to make weapons grade uranium. >> i spent some time with the secretary going over the weapons of the testimony, and maybe you can help for those who don't have all of the nuances to make in laymen's terms what you describe as the loophole for the testimony that we described to continue the development of the centrifuges. what exactly does that mean and why is that consequential? >> it is much more capable than the ones that they played

anywhere from three to five times more effective, and also it is more reliable. it's based on a german rich refuge that went to pakistan and then iran modified it and it's more reliable than. so during the interim deal they are still able to run the production scale cascade the pilot plan and you can learn to operate it better and work on its reliability to further improve that to gain confidence and running it in this cascade. they would still need to deploy it in large numbers and they started to do that at the underground site. there is a thousand deployed in the cascades and they would still need to do that, so you cannot finish. but they can make significant progress on continuing to develop this machine.

>> one of the things you said in your testimony that development is that the centrifuge while hiding any result of the progress. >> a year or two ago they told them they would start enriching enough machine and depositing the product into the product tanks and everyone else would know how they work. they been subsequently announced they were not going to do that. so they were somewhat blind about the capabilities of the machine. is it truly that great or is it having problems and so they just don't know. the worry is that they are hiding the capability so no one knows and it is making progress. >> the importance of the elements of the centrifuge as you say in the testimony in the interim period is better to it o

deploy a reliable centrifuges, which is the more advanced centrifuges on the mass scale at the enrichment plans and if there was to be no agreement, it would allow iran to make up for the time lost more quickly. you go on to say a centrifuge five to ten times more capable, and those are the ones that they are using now would require five to ten times fewer centrifuges to make the same amount of the weapons grade uranium allowing from a smaller facility fewer personnel and procurement of less material. the centrifuge research and development could lead to breakthroughs in materials on the methods that would further strengthen a secret breakout effort on the implementation and verification of a comprehensive solution. extremely difficult.

>> when i say five to ten times, that is beyond. they are working on such machines the state had been in the past of the international inspectors so they want to have a machine that is up to ten times the output of the current generation and they pose particular difficulties for verification if you do as you are stated you need far fewer of them you can get by with a smaller facility and particularly if you're developing the skill to make thethem an offer they band bannn you do have to worry about them and it would be better that they ought to be developed on the recommendation. >> and the final conclusion is the development of the advanced centrifuges would greatly ease its ability to conduct a secret breakout. >> it's the capability then you can use a much smaller facility.

it's from about 3,000 centrifuges, so if you can reduce the number of thing happens as you learn to operate a more sophisticated machines you are advancing your skills quite considerably. when they are faced it is getting them to operate at a minimal level and they face many breakages and have trouble getting the enriched uranium. >> during the interim period, iran can focus on building up its supplies of essential goods and easily beating bottlenecks -- elite eatin bottlenecks intoe problems will grow longer on the interim period and then you go

on tuesday it works more in favor of iran than the united states and its allies. can you explain why that is the case clacks >> they do need to go out and buy things. you need to buy pumps for the reactor. they need to have steel. there's all kind of vacuum related equipment they need to buy. and they now have an opportunity to continue that. and the sanctions and the law is designed to try to stop them but they have proven to be less effective than i think that we thought they would be. the iranians are very good at smuggling and while many of their efforts are stopped there is an interdiction of the goods and things are getting through. now they have an additional period and what they can do is

develop a stockpile of material that would've been allowed them to build many more machines and that is the bottom line is if they can stockpile and if the deal breaks down they can build a lot more. it's also why we think in recommending dissolution that iran would commit not to do th this. they have to give up the smuggling operations that amounted to so effectively. >> i have questions for you but i'm going to turn to senator corker. >> i want to thank you both i think your testimony today is both in written form and orally it is outstanding and i wish everybody on the committee could hear it and as someone paying attention but mr. albright i will start with you since you testify at first. what is the current capability to detect if iran is enriching in a warehouse someplace that we are unaware of?

>> despite recent reports in the media it's pretty good on iran with its allies it is a combined effort and it is identified sites in early 2,000 so it's been willing to work with the international inspectors so you can have people on the ground using intelligence information so it's pretty good but it's not perfect and there is a worry that if iran built a secret centrifuge site it could go undetected and the current arrangement with the inspectors right now isn't enough in order for them to say they can tell you they could find a secret site so there remains a risk and that's why you want the deal to be short-lived and to try to get a comprehensive solution where the verification arrangement are put in place com combined with western intelligence to provide much greater assurance that there is no secret nuclear site.

>> based on the way the negotiations have begun and looking at the public comments that they are making what do you think today is the likely outcome of july 20? >> after we released the report a couple weeks ago i must say that i can't be very optimistic. the statements are pretty clear and i think that you quoted some of them. they appear unwilling to accept the deep cuts in the centrifuge program that are necessary. they may allow a reactor to be converted into another type and maybe they will even shut down. but getting them to reduce the number of centrifuges is going to be very tough. i think the military dimension side of this is going to be very tough.

they have dug a very deep hole. i did appreciate in the legislation that you produced there was a condition for him that iran is going to have to satisfy the test and possibly ongoing military issues. the administration has said in private settings there will be no comprehensive solution unless they satisfy -- iran satisfies that they would like to see that as a firm written statement in the administration. >> i do agree that as we move along and the economy improves and the indicators that we see makes it even more difficult to have leverage to cause us as a

country to overcome where they are. do you agree with that? do you agree with the comment that your colleague made? >> i worry another reason in my mind where you want the interim period as soon as possible with consequences on iran if that period elapses. we will have to see. we are not economic specialists by any means. we are not specialists so i'm just offering that. >> you talked today and in written testimony and we had a long meeting with you yesterday. what do you think the effect of passing the legislation menendez and kirk offered, what would the effect of that fee relative to

the economy today? >> i think the legislation had as its intent to send a credible threat to the international market that is premature to go back to iran and if they do not satisfy the condition and if it fires off the missiles and all the sanctions relief would be gone and opposed on iran and most importantly it sent a very clear message that this will not be an endless process negotiation that there's a 12 month clock on this and at the end of the 12 months iran has to come to a comprehensive nuclear deal that satisfied both parameters and principles that were laid out in the legislati legislation. it doesn't specify how many they should be left with but it has very clear state parameters and that is important to send to the

international business community and the investors and the consumers in iran but at the end of the 12 month period if there is no comprehensive conclusive deal the sanctions will be imposed. i think that had the legislation that passed it would have given a lot of credibility to the threat and without a credible threat we are going to start to see the macroeconomic data shifting and iran's fever and i think it already has. it's modest and fragile but it's also real and by the end of 12 months if that economic recovery has become much more substantial than i think there is far less pressure on iran to negotiate and then my ultimate fear is raised which the administration and iran want to keep rolling over the deal for an additional six to 12 month period it satisfies both and there is a

great risk in doing that because then they will gain even more economic leverage as the recovery increases. >> my staff is about to have a heart attack because i need to be someplace else if i can ask a question for the record i would appreciate it we have seen what happened in turkey with the goal for oil situation. we now see it almost is like a copycat kind of effort taking place or being proposed by russia right now is it your sense that the treasury department that this was an oversight or do you think that this was an accommodation relative to the negotiations taking place? >> i have the greatest respect for secretary cohen and any sanctions he and the treasury have done her qa and work in helping to enforce the sanctions that congress has put in place. i think that there were potentially other considerations

the state department and the white house had in not cracking down on what was and it listed financial money laundering scheme that it has yielded over $100 billion, and it's a long and complicated saga about what happened and how the administration responded and provided a golden loop holes that were not closed until the congress finally closed it and the administration insisted there would be an additional six months they came into effect and i think it had a lot to do with the secret negotiations taking place with iran and had to do with the goal of the sanctions in february and april. but the conclusion is that iran was able to exploit a significant golden loop for and get 13 billion over $100 billion in illicit financial transfers and ultimately blow a major hole in the international financial

sanctions regime. we cracked down on turkey and perhaps that is because of presidential,'s partnership. my fear is on the deal we are going to be faced with the same situation and despite the assurances that everybody has read the act and vladimir putin i'm a little concerned he is and necessarily deterred by the administration riot act. >> not to be pejorative but it understood that they type their future in so many areas to it relationship with russia that it really is difficult to sentence or even feel that they would crack down on this in an appropriate way that i hope they will. >> thank you mr. corker for your work and participation helping us prepare. let me finish off with you

mr. albright. help us define for the record what a verifiable long-term deal, the elements but it would be to ensure that iran doesn't have nuclear weapons capability. >> it is a long list of provisions so let me try to summarize. we talked about the reactor needs to shut down. there's also i think even before that you have to have commitments from iran not to process or separates the plutonium and want to build facilities capable of doing that. so even if the reactor shut down, that's not enough by itself. you hold onto them and enriching above 5%. it would just be limited to the types of fuel used in the civil nuclear reactors or power

reactors. i mentioned the one above procurement of the goods illicitly. the centrifuge end of the enrichment died it's going to be important and again these were the conditions imposed for a certain duration we are recommending 20 years but you would want to limit essentially the models no greater. you wouldn't want to stop that one necessarily. you need to limit the manufacturing and so if you reduced the size of the centrifuge program significant significantly, you are going to have a lot of spares. some would be set aside and stored and used so iran wouldn't need to make any more of the centrifuge is ever again and even if they subsequently deployed those under this camp on the size of enrichment they would even have spares so you

would've limited that part of the program. one of the issues is the size of the stockpiles that one of the things the interim deal does is news let's say near 20% hexafluoride into another chemical form and it puts it in a different category and under the interim deal that it seemed okay but you can take that material and convert it and so you do not iran wanting to hold that the types of that so you would also want to cap that and iran would have gave up and send out the country a significant part of its near 20% stock file. you also want to get in terms of -- you want to have more control over the mining and milling

operations where again this is more verification that they would be more open about how much is made every year and where it goes and then in addition you would impose the cat you don't want them mining more than it could possibly use so the limits would be consistent with the centrifuge program that is allowed. you need the conditions not to proliferate. there is worries about working with korea to bypass some of these caps so you would want to have some commitment not to do that and let me end on the verification the additional protocol is a marvelous improvement in the verification for the atomic energy agency and it doesn't change the rights but against them many more tools and together this then things got it

-- in the case of iran is just not enough. it's a country that has successfully deceived the iaea for many years and refused to cooperate. there were several more conditions that would need to be imposed and some of those would be that they have greater access to the centrifuge manufacturing complex that remained. right now under the deal it could see where the rotors are made and where the centrifuges are assembled. even in that case you would want to know how many have been made. how many materials have been procured. >> so they are a pretty extensive list. >> that's about less than -- >> what drives me to concern is the gulf between the list that

you and the institute and others have said dennis ross in his article for example and the gulf between that and everything that we here in iran in which president rouhani says we are not going to destroy. but there is a huge difference between where these two parties are at and certainly from the west perspective p5 plus one would be absolutely necessary to have a deal that is verifiable and that can be embraced. >> i think we have to plan for the deal not working or the negotiations to fail. president obama gave a 50/50 chance and the iranians gave less of a chance and administration officials below the president have given it a pretty low chance of success so

if that is the true picture, then i do think we have to start putting in place some plans for failure and what will happen then and it may turn out that it may incentivize or give the iranians an incentive to compromise more. >> that brings me to the other point and i appreciate your work and insight overtime. first let's talk about the value of the sanctions relief that has been pursued under the joint plan of action. you suggested both in the extensive written testimony that it's beyond 7 million. talk a little bit about the 7 billion in the context of what was iran's available cash reserve versus its ultimate cash

reserve. >> thank you chair man menendez. 7 billion is not significant. i mentioned according to our sources, iran only had a $20 million a fully accessible reserves and much of the money was actually locked up but was in escrow accounts but the $20 billion they could only access. so you are increasing the fully accessible reserves by 35%. the second issue and it's been positive for me i haven't understood why the administration came out and refused to acknowledge there would be a shift in the market psychology that investor and consumer sentiment may increase that there may be some illicit deals with russia or turkey or a third countries and of the sanctions mathesanctions may ben $7 million raised on a shift in the market sentiment and the

administration could easily have acknowledged that were said to congress it's possible this is more than 7 billion it may be more than 7 billion. we will do our best to ensure that it is as little as possible. what it leads me to believe and this is where i get worried is the administration understands the sanctions relief with more than $7 million but the case is they are trying to get the president hooked on cash and what i mean by that is they are trying to create an economic incentive for rouhani to compromise and a baby leave the people will demand it and will strengthen rouhani and therefore he will have more leverage to negotiate a deal within six to 12 months and when we start to see the indicators turn in their favor and they are already turning in their favor the administration will come back in three to six months and say we think it's a good idea and the

real dollar exchange rate that gdp is starting to increase and recover. all of that we didn't anticipate but now we acknowledge and that is a good thing because it is incentivizing iran to do a deal. >> we heard that also and i think the secretary's responds i think senator murphy said the oe trade missions incentivize the regime to think about what could be. i look at two sectors you talked about extensively in your testimony, the automotive sector and the petrochemicals sector and it's interesting to release to the petrochemicals sector helps the ayatollah received money directly through the control which is a conglomerate totally controlled by the ayatollah and for which they have several investments.

is that a fair statement? dimmick perhaps they are trying to get the supreme leader on as well because if his holdings in the petrochemical companies on the stock exchange increase in value and he will start to see the economic benefit but i find puzzling about the relief that has been provided is what we have done is provided relief on the key sectors of the economy id and others recommended if we were going to provide any relief it should have been strictly for the return of some frozen revenues not to iran but to be put into other accounts where they could spend that money in europe but instead what the administration has done is lifted sanctions on the most lucrative sectors including the sectors that you have acknowledged untold by the ayatollah and the revolutionary guard. >> to the extent they are opening those sectors it's legitimate for the private sector to say for this period of time we can be engaged in these sectors because they are no

longer subject to the sanction, and isn't it fair to say that when the administration has tried to quantify the value, that presumes six months of relief for value based upon what those sectors provided prior to the sanctions not an enlargeme enlargement. if i were iran i would put the pedal to the metal and try to maximize the petrochemicals sector during this period of time so i could get better benefits and increase the parts available so i can move the ball forward should an agreement not bto be achieved; is that fair? gimmick again what i find puzzling is let's take the auto sector the administration values the $500 million on the assumption that iran will not be able to sell $500 million more cars if you look at the auto sector in 2011 it represented about 10% of the total gdp and

contributed $50 billion to the economy because the secret about the auto sector is that it doesn't have a huge export potential that has a domestic potential the country is 75 million people who want to replace their cars and the major international auto companies who by the way were there two days after the geneva agreement was signed and recognized the enormous potential for the auto sector so what i believe rouhani has done is he has bought himself not only something that has tremendous economic potency but political potency as well where he can represent himself as the man that saved the auto sector and if you look at the potential for the wages paid in for the gdp actually generated, you have over the next six to 12 months more significant potential van the administration is acknowledging and the other i think concern that i have is you heard the under secretary cohen

say you've got to have your deal done in six months. goods delivered, payments made within six months yet they are acknowledging this is going to be a 12 month deal, and they actually acknowledge that this can be renewed an additional six months so if you are a ceo and you want to go back into the auto sector you are not thinking of this as a six-month field as a 12 month deal and you are thinking you have to get ahead of your competitors so you need to get back in there and soak you are starting to make those decisions not only based on a six-month window or 12 month window but you are probably assuming the administration is going to renew this agreement for the further period of six to 12 months for so you have the auto sanctions relief and now the opportunity to exploit a market on the boston consulting group says is the world third most promising auto sector after mexico so this is a significant

sanctions relief, again for the nuclear concessions as david albright has said it may be important but also is reversible and may not get to the heart of the military program. >> on the oriole relief it seems to me that one of the reasons he and i didn't want to continue because i wanted to get to both of you, my understanding is that actually there can be a permission to purchase more than the latest reduction because what is going to happen is there is going to be an averaging out that the overall reductions over time and if that is the case then not only is the amount of money underestimated by forgoing the additional six months of reductions it presently calls for which are forgot but also an increase in the amount of purchase that would be

permissible to the countries that have received exceptions because if you average it out, the lowest point being the president claimed that a higher point at a different point in time you will arrive at the amount you can purchase. >> there are indicators where it may be going. he has assumed in his budget that iran will be exporting 1.5 million barrels per day is on the assumption president rouhani if he's a better economic managers than his predecessor is being conservative, you would assume that he has some expectation that over the next 12 months, he's going to be able to export 1.5 million barrels per day. the second interesting economic indicator is the exports in october were down to about 760,000 barrels a day and they've now recovered in january about 1.2 million. so you are starting to the geneva effect on iran's oil

exports as they begin to recover from 700,000 to over a million barrels. >> if i could quickly finish on this and that is your legislation closed a very important loophole that they have been exploiting which is to allow them to export the $1.6 billion compensate sue over the six-month period and the geneva agreement becaus becauses come into affect iran will earn 9.6 oem dollars in the oil and compensate revenue and in addition to what they are earning him the label side. on the label side. so in total you have the oil sector i believe they have estimated is going to start to recover the barrels and the slow. and i think the net effect of this to tie this into doctor albright's testimony is if we even get a company to deal with iran, what leverage do we have left to ensure verification and

enforcement of the deal? we are putting a lot of faith in the iaea and even in the additional protocol. if you read the pentagon report that was recently released, you see that our history of detection of breakout is not good and the question is even if we do detect, how do we enforce it when they engage in what they always do which is cheating on their nuclear program are we going to have the tough sanctions in place so we can lower the economic boom to force them back into compliance or will we have traded away all of our economic leverage so we will have no enforcement mechanism left based on the strikes the inspectors are not allowed into a facility and i worry that the administration hasn't done enough thinking on what kind of enforcement mechanism we are going to continue to comply with the responsibilities. >> writing that is a critical question and when i looked at the directorate of intelligence

clapper's statement i guess it was before the intelligence committee that in fact iran possesses and we heard secretary sherman say they have all the knowledge and the question is have they made the decision to move forward towards nuclear weapons? so if you have the knowledge and then if you have infrastructure, nuclear infrastructure intact you are just steps away when you make that decision of moving forward and to the extent that iran has arrested itself and making that decision it is only because of the consequences of sanctions that have been enforced that have the ayatollah thinking about the regime change not from without, but from within. to the extent that goes by the

wayside that there is no economic pressure to be concerned about the regime change to preserve the regime it changes the equation to strike the type of deal that we have defined that would be necessary and ultimately if we do not have the extends doctor albright has listed and i think others would agree to then we would fall short on the regime's and it will evaporate and the only question for the future american president is having still in infrastructure having the knowledge that making the decision there will be no sanctions to end forced to enfo,

re-create an international order and have the sanctions be pursued so that equation will be off the table and the only thing left will be do i accept the nuclear armed iran and what that means on that whole part of the world, or do i have a military strike that is in the unenviable position to be fun in fact we could be in a much better position. >> before it was sitting -- -- i think it reinforces the need to both cut down the sides of the e program dramatically and increase the verification and in the cases that we have when you have those combinations you can verify it. the u.s. intelligence may fail but again i would argue it is western intelligence working

together and combined with the cutback in the very intrusive can give you enough of the morning to provide a sufficient time to mount the new effort but if iin your case you don't cut t back enough then i would agree that could be with the future president faces. >> i think to your point my concern is the verification could be perfect. the detection could be perfect but if you are no longer have an option beyond the military strike then you are in exactly the situation you described which is a future president in a the position to choose the nuclear breakout or a military response. what you've done and the committee has done and what you are attempting to is retained a peaceful response to the

detection. every time you are going to lower the economic camera and that's going to create a kind of domestic discontent that may be a threat to your regime's survival. despite the best work of david cohen and peter harold and all the folks at the treasury and the stakes that are dedicated public servants have done a tremendous job that the market dynamics are shifting into the market psychology is changing. ..

[inaudible conversations] >> and we are live on capitol hill on this friday morning where former iran negotiators from the obama and george w. bush administration will discuss the ongoing talks with iran to halt its nuclear program. talks between iran and six world powers resume in vienna on february 18. today's event is being hosted by the partnership force a secure america. this is live coverage on c-span2. it should start shortly. [inaudible conversations]

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>> well, good morning. i thank you all for coming this morning. i think we have a very exciting program and we're going to focus as the flyer indicated on the iran nuclear program. i'm anti, the executive director of the partnership for american help talk more about who we are in a second. but this bill today is part of what we call at the partnership a part of our visit building initiatives program. and this is actually our second program in that area. we are excited obviously today to hear the thoughts and the analysis and predictions on the iranian nuclear program from two very experienced policy practitioners, and strategic thinkers, nick burns and bob einhorn. we want to hear their thoughts for the prospects for the joint plan of action that was completed last november, and its

implication started about two weeks ago. in the words of wendy sherman who is the u.s. principal negotiator, before the senate foreign relations committee earlier this week, she said that this joint plan is sequenced over the next six months to explicitly block near-term iranian pathways to nuclear weapon, while creating space for further negotiations to reach a long-term comprehensive solution. the goal of course is to downsize iran's nuclear program with the ultimate goal of preventing iran from building nuclear weapons. the election of president rouhani on the first ballot last june with a mandate to fix the economy, together with a strong impact of the international sanctions on the iranian economy, of what is possible. after 34 years of no official talks we have now, the joint plan of action, and follow-on talks through the p5+1 process

on comprehensive agreement by the parties that is scheduled to restart those talks later this month. let me say a few words, a little promo for the partnership for a secure america so you know who we are. we are a nonprofit ngo which was started in 2005, started initially by former congressman lee hamilton and the late former senator warren rudman. we have an exemplary board of advisors, about half democrat, half republican. all things of which you would recognize, several former sectors of state, secretary of defense, senior government officials, uniform -- former uniform height ranking and others. as i say about how far democrats and republicans. our main mission and the partnership for secure america is to do what we do to promote fact-based approaches to foreign

policy, national security, and that's our principal mission and we try the best we can on that. we do this through a number of means. we issue occasional statements on the preventing issues of the day. we hold panels such as the one we are at today and we also have a highly successful congressional staff program which over the last so here's has a cumulative more than 200 alumni in that program and that program is still ongoing. in this regard i just wanted to mention that we have flyers at the sign-up tables because we want to start the next program, the next class of congressional staffers and congressional partnership program, which will begin in april later on this year. i want to get right to the program to let me do the introductions of our two distinguished panelists. you have your bios at your

seats. there are also three by five cards that are there. we will ask you, if you want to ask questions, post questions on those cards. they will be picked up and brought forward and i will sort through them and ask the question. we don't have the microphone system here to be able to use that otherwise. both nick burns and bob einhorn have had outstanding diplomatic careers in the department of state and have performed distinguished service to our country. both have played leading roles in formulating u.s. policy and negotiations on iran's nuclear program. each has served in senior positions in republican and democratic administrations. very quickly, although you have this material i think in front of you, nick burns was a career foreign service officer from 2005-2008, under secretary of state for political affairs. during that time he negotiate the u.s. india nuclear cooperaticooperati on agreement and lead u.s. negotiators on

iran nuclear programs. he served as ambassador to nato 2001-2005 and before that our u.s. ambassador to greece. in the early 1990s he served in the h. w. bush and clinton administrations, senior director for russia, ukraine and your ration national security council. nicnick is now a the consultanto him on, professor of practice of international relations at harvard kennedy school of government and is on board of directors at the belfer center for science and international affairs at harvard. he also writes a biweekly column on foreign affairs for "the boston globe." bob einhorn is work for nearly four decades on issues related to arms control and nonproliferation. he spent his early years in the arms control and disarmament agency and was part of the delegation that negotiated the strategic arms control treaty with the then soviet union. he worked in the policy planning staff of state department and of state department and then as deputy assistant secretary for

political military affairs before becoming assistant secretary of state of a newly formed bureau of nonproliferation, and the lashes of the clinton administration. wallowing that he spent about seven years at the center for strategic international studies here in washington before returning to the state department to serving the obama administration as the secretary of state's special adviser for nonproliferation and arms control. and since early this last summer, he's been senior fellow with the arms control and nonproliferation initiative, and with the center for 21st century security and intelligence, both located in foreign policy program at the brookings institute. i have asked each to speak for about 10 minutes and then we will open the floor. please jot down the questions you might want to ask, and those will be passed to me and i will sort through them. let me note also we'll be tweeting this event, psa online at at the table.

and c-span, c-span2 is covering this with a live feed. so with that, nic, do you want to start? >> thank you very much. good morning, everyone. it's a real pleasure to be here. [inaudible] >> okay. it always helps to turn the button on. let me start from the beginning. good morning, everyone. thanks, andy, for the very kind introduction to i want to support what the partnership for a secure america stein to do, not to build a better sense of bipartisanship here in washington. on capitol hill in particular. as andy noted, both bob and i have worked for republican and democratic administration. i was -- started as an intern in the jimmy carter administration and with all the way through the george w. bush administration and i certainly believe that while politics is important, when it comes to national security of the united states, americans have to unite. there's no reason why the two political parties can't be in

support of each other. and of our country on the most important issues, and the iran nuclear issue i think is probably the number one priority of american foreign policy in 2014. because we are at a very critical, the administration is a very critical juncture. let me start by saying i strongly support what president obama and sectors day john kerry are trying to do. when i served in the george w. bush administration working for secretary of state condoleezza rice, we tried to negotiate with the rand. in fact, we offered negotiation, p5+1 group, germany, being the one, britain, france, united states, russia and china, we offered the 2006 and 2007 publicly for the iranians to negotiate and he turned us down. we formed this group of the security council members in germany because we thought it was important to have a global conversation with the iranians. and when they turned us down we turned towards sanctions and the bush administration helped to pass and the security council three chapter seven sanction

resolution at the obama administration really took the baton from the bush administration and carried it forward. so i've always seen this policy to be highly bipartisan. i don't the discerning differences at all between president obama and president bush on this particular issue. i think we can take some comfort in that because it is the key issue for our country. that i do support what the president is time to do. andy mentioned until the negotiations over the last six months that it is ably handled under secretary of state wendy sherman for secretary kerry, we have not had a consistent, sustained, strategic dialogue with the iranian government since the jimmy carter administration. and if there is a probability that the united states at some point could theoretically have to consider the use of force against iran, it does make sense to exhaust diplomacy first. and entered into the

negotiations the president has committed himself to. so i support the idea of negotiation. it's entirely consistent in my view with what the bush administration was trying to do. i also believe that the president was right to negotiate the interview. and bob can speak with far greater authority on that and i can because he was part of the team that led the obama administration's efforts in the first four years. but that deal essentially freezes in place, as you know, the major elements that iran's nuclear program still provides the time for diplomacy to act and to operate. this problem will not be overcome simply or quickly. you need a time that the president has now given us to negotiate. but i do think the next round of talks, for the final agreement, which begin next week in geneva will be infinitely more difficult. because now the pressure is going to be on iran. and the spotlight will be on the iranian government.

because they're going to have to agree, in my judgment, to a significant rollback of their current nuclear, civil nuclear program, the idea that they would have 19,000 centrifuges spinning is something that the united states i don't think can tolerate. we are going to have to see dismantlement of part of the program. i would think that the negotiators from our side and the european side would want to see some significant transformation of the arak heavy-water reactor. either a just moment of that facility altogether or some kind of transition or that facility so that we can be assured that it doesn't open up another route through plutonium to nuclear weapon. and so i heard, under the foreign ministers the reef said last week that he had not committed to dismantlement. i expect, i have to hope that was for domestic purposes and

iran. and i have a very complicated political theme in tehran. but i hope he understands and every in devon understands that dismantlement has to be part of this. and that the iranian government, which is seated before the international community and being judged, because they've misrepresented or lied about their program in the past, and because they have gone far beyond what the international committee wants them to do, they will have to prove to us not just through inspections, the iaea, but through dismantlement that they are ready to become a peaceful country with civil nuclear power, and not a country intent on developing nuclear weapons. that's the test within. i think the pressure has shifted to them in peace negotiations. i strongly support the president and what he is trying to do. i think he has brought us very skillfully to the as and a where negotiations will not be much tougher. a couple more points because we

want to speak very quickly to get to your questions. i know that congress has been considering the merits of additional sanctions on iran. and my own view on that is that the president has to decide, execute american foreign policy. we elected him to do that. the constitution gives them great authority in foreign policy. i don't think it's a reasonable proposition to think within a 535 people negotiating with iran. the president has to represent the united states and he has clues add to this administration has said that further sanctions at this time would not be helpful. if that's what the negotiator thanks, i would think we should honor the wishes of the negotiators and support him on a bipartisan basis. there may come a time should negotiations break down where further sanctions by the congress would be helpful, but we would want to see, aching in my judgment, and integration between executive and legislative branches on this very important issue, it is not

a trivial matter. this is the number one issue facing our country overseas. and so i hope that the report that congress will likely stand down on the current sanctions. i hope those reports are accurate. and that congress will give the president that time and the space in the room that he needs to be our chief diplomat, which is what he is, and her chief negotiator along with secretary kerry in this very important matter. and, finally, i do think it's important that we have leverage on our site. diplomacy often cannot succeed unless it's helped by leverage. what they mean by that is, i hope the european countries and the other countries that used to trade with iran will now not rush as they are going to do to open up business as usual with the iranians. we've seen lots of delegations from european countries and asian countries in tehran trying to set the scene for a reopening of commercial ties if sanctions are lifted. and the major sanctions are still in place.

it's the wrong message to the iranians to make them think that they are 90% of the way there. they are not. they have not yet made the fundamental compromise and i think secretary kerry was absolutely right the other day, two days ago, when he criticized this and said that we have got to maintain unity, internationally and send the iranians one message. and that is, there will not be business as usual with them commercially until they earn it. and they haven't yet earned it. and, finally, if you're trying to assess probability of the president has done that publicly, he called it a 50/50 probability of whether or not the united states can be successful, i would think that the complicated politics of iran at some point are going to become a major part of the story. i don't doubt the sincerity of president rouhani or foreign minister zarif. they seem to be generally interested with a new relationship with united states and europe and in reform in general. but if they do negotiate and

they bring back to tehran i think it is at least an open question, how the revolutionary guard, national security council and the supreme leader how money will react. and so our job, the job of our government is to defend our country at the negotiating table and negotiate the best possible and the toughest minded deal. it's going to be up to the iranians, the government to make sure that they are fully on board in tehran and that to me is an open question. we have yet to hear in a convincing way from a more reaction elements of the iranian government but i support the president in which the administration success, and very happy to be here with my friend, bob einhorn. >> andy, thank you. i think the partnership for its secure america for inviting me. it's a special pleasure to be here with the nick burns who is one of the best foreign service officer from one of the best

diplomats i've had the privilege to work with over these decades. i think since the geneva joint plan of action which agreed in november has been a kind of dynamic at work between tehran and washington. and it goes like this. critics in each capital attack their own administration for having gotten the short end of the stick in negotiations. what happens then is that the administrations understandably defend themselves. they stress the benefits to the country of the interim deal, and they reassure their critics that in the final negotiations, they are going to be very, very tough. and then these defenses in turn become ammunition for critics on

the other side to attack the deal. so, for example, u.s. critics point out that the interim deal doesn't dismantle iran's nuclear infrastructure. that's correct, it doesn't do that. so the administration, the obama administration naturally feels compelled to say that in a final deal there's going to be a major dismantlement, a major reduction of nuclear infrastructure. and then the iranian critics say, you see, we told you. the americans are only interested in cutting our enrichment program. and then rouhani, to defend himself against that charge, says we're not going to reduce any centrifuges in a final deal. and so you are off and running. another example, the iranian

critics of the deal say that the sanctions relief in the interim agreement are peanuts, are insignificant. and so the rouhani administration at that point feels compelled to say that, well, this interview was the first big crack in the wall of sanctions, and that sanctions inevitably are going to unravel. and so u.s. critics read that and say, look what's happening to our sanctions regime. you know, it's falling apart. and the administration then has to say, well, no, they are not falling apart. in fact, the main sanctions remain in place which is absolutely true your queer going to enforce the existing sanctions. in fact, we're going to impose additional sanctions measures under the existing sanctions regime. as they did by the way

yesterday. then iranian critics look at that and say you see, the american administration is not series about the negotiations undermining the talks are there only after regime change. they are operating in bad faith. i was and remain a supporter of the two-step approach to this negotiation. gaining an interim deal and bind time and space for negotiations on a company to do. i think there are reasons for the. it gives us six months to test iran's willingness to implement the deal conscientiously, and it holds for the progress in iran's program. so you are not in a situation where iran is making major progress in its program while you are negotiating. that would be kind of politically and strategically unacceptable. but one of the downsides of this

approach is that you open yourself up to early criticism and maybe you make it more difficult to get to the in game. but i agree with nick that this first step deal, the joint plan of action, is a very good deal. but, of course, the test of a diplomatic track will really be what happens in the comprehensive agreement, and that's at least six months down the road. the joint plan of action does halt for the progress in iran's nuclear program. and in some small respects it reverses progress. the requirement that iran neutralizes its stocks near 20% enriched uranium. and it's important to remember that in the absence of this interim agreement, iran could make major progress over the next six months in its program. it could shorten quite

substantially the so-called breakout timeline, the time it takes to go from a decision to build nuclear weapons to having sufficient fissile material to produce a single nuclear weapon. that timeline would be shortened very substantially if iran would continue its program. but it's unable to do that. it's true, the interim deal doesn't dismantle a single centrifuge. it permits some continuation of research and development activities. that's absolutely the case, but these are objective. these are items towards the comprehensive view. on the sanctions relief, i think it's the wide precipitation that significant sanctions which are, in fact, quite modest. i think the concern is that there will be a kind of psychological shift, shift in

expectations, and this will open the floodgates to new business activity with iran, and unraveling of the sanctions regime. now, this concern is that by a number of development. the rouhani government has been quite skillful at pursuing a public diplomacy campaign. you saw it at the dog goes world economic forum. iran is open for business, inviting businessmen to come to iran and cat new deals -- davos. you see it in succession of trade delegations, the french delegation. a turkish delegation led by prime minister erdogan. reports of russia-iran's oil for goods deal, which by the way hasn't materialized, the administration has strongly opposed it with the russians and at the highest levels.

but talk of that kind of activity raises concerns about whether the sanctions are really evaporating. but while there's a lot of smoke, so far we see no evidence of fire. businessman, governments are very cautious about engaging at this point. they know that the major sanctions on banking, in the energy area are still in place. they know that the administration is going to be imposing sanctions during this period. new sanctions under existing authorities, if attempts at evasion are detected. and so my sense is that, that this regime, sanctions regime will remain intact for the six-month period.

there will be some benefit for iran to of course there will be benefits for iran otherwise iran wouldn't have joined this interim deal, but the existing sanctions will provide plenty of incentives for iran to negotiate a final deal. a concern has been that they will be so much sanctions erosion during the six months that there'll be no incentives left for iran to negotiate. i don't think that's the case. i think rouhani and his advisers understand that if there is done is to on track, it will require a lifting of sanctions, not just the easy of a few measures. and so there will be plenty of incentives to negotiate. so the talks on the final deal if they begin favorite 18th, coming up very soon, but as nick pointed out, there are differences between the sides. i'll just mention a few them, probably the biggest is about the size of the enrichment

uranium enrichment program that iran will be able to retain under the agreement. the u.s. goal is to lengthen this breakout timeline, the amount of time it would take to have enough highly enriched uranium for a single nuclear bomb. and to lengthen that timeline, i'm sure the u.s. and its partners in negotiation will press for a significant reduction in the number of centrifuges, constraints on the types of centrifuges that can be used, tight constraints on the amount of enriched uranium that at various levels, that iran will be able to keep on its territory and so forth. iran has given every indication that it's going to resist deep cuts in its nuclear infrastructure.

it will want to retain as much as what it already has installed, and perhaps even expand what it has already deployed. it will claim that it's got a robust, a nuclear energy program, and it needs to expand its enrichment capacity in order to support that program. perhaps a way forward is to focus on the practical needs of that, iranian civil nuclear program. in fact, the joint point -- the joint plan of action indicates the final agreement will provide for a mutually defined enrichment program based on practical needs, but what are iran's practical needs? they are, in fact, quite limited. iran has a small research reactor. it out has produced enough fuel to fuel that reactor for a long

period of time. it has a power reactor supplied by russia, but russia is supplying fuel for that reactor. it wants to build some small research reactors to produce medical isotopes. that's fine. we support that, but those small reactors don't take much enriched uranium as fuel. so, in fact, iran's real needs, it's practical needs are very limited. and i think that can be a basis for agreement on the enrichment question. nick also talked about the heavywater reactor at arak. i have no doubt that this reactor was designed to produce plutonium for a nuclear weapons program. it's precisely the kind of reactor, the size reactor that a number of countries use to embark, to be a weapons programs. i'm sure that was the initial

intention of the iranians. they say now that it is to produce medical isotopes, but it's not the best type of reactor for the production of medical isotopes. much better for that purpose, and a much poorer producer of plutonium would be a reactor moderated by heavywater. i'm sorry, light water research reactor. the head of the atomic energy organization of iran a few days ago gave some hints that they would be prepared to accept some design modifications of that reactor in order to reduce the plutonium production threat. it's not clear what he means by that. one way to modify it is for it to be fueled by lightly enriched uranium rather than natural uranium which should be somewhat better than filling it with natural uranium. that would be fine but it was

not nearly as useful a step as converting it to a light water research reactor. and i think that's the solution that would solve this difficult issue. there's also the question of this underground enrichment facility at fordow. this was a secret facility. it was outed by western intelligence agencies in 2009. my guess is that it was designed as a covert component of a nuclear weapons program. but now it's at a facility that was previously used as a military base, buried deep underground, less vulnerable to preemptive attack. it has no logical role to play in a future iranian civil nuclear program. it could be dismantled

altogether, but if that isn't too difficult, too much of a loss of faith, then perhaps it can be repurposed, converted into a research and development facility with all of its centrifuge cascade removed. monitoring and verification would be difficult to i think it's positive that the iranians have agreed to ratify the additional protocol under a comprehensive deal. that's a good step, but the additional protocol isn't enough. given iran's track record, which is a very poor record, track record of compliance with its safeguards, obligations, it's important that they agreed to go well beyond the additional protocol. in a number of there is, the joint plan of action is a good step in that direction, with access to centrifuge production facilities, uranium mines and

mills. these are things that could give us some confidence that they are not pursuing covert nuclear program, but in a comprehensive agreement they have to go even further. a very hard issue will be one that is called the pmb, a possible military dimensions of iran's nuclear program. november 2011, the iaea director general came out with a report itemizing areas in which the iaea believes iran come in the past, engaged in research activities related to nuclear weapons development. for two years, the iaea and iran tried to get to the bottom of this, stonewalling by ran made it impossible to clear up the iaea's concerns. so now the issue remains, and without a full understanding of these past activities come is

just not going to be possible to resolve this issue in any fundamental way. it's made harder by the fact that president rouhani keeps saying, not only does iran, is it not pursuing nuclear weapons, but it never pursued nuclear weapons. besides that, the supreme leader talks about i thought law, saying that nuclear weapons would be against islam. so becomes very difficult to confess that iran was engaged in nuclear weapons related activities, given all of this. so i think negotiators are going to have to be very resourceful in finding a way to resolve this. i think the key will be to frame the issue in such a way that iran doesn't have to admit past

guilt, but provide sufficient information to satisfy us that some activities engaged in the past do not have implications for covert programs in the future. that's going to be hard, that it's going to be essential. and the final issue i will mention is duration but if you look at the joint plan of action, it only says at the end that the conference of agreement will be of long-term duration. the parties could reach agreement on a precise number of years. it becomes very important because another element of the joint plan of action is that once this comprehensive agreement expires, then iran will be treated in the same way as any nonnuclear weapon states party to the npt. and what that means is that perhaps some of the special restrictions on an enrichment program, on the iraq -- arak reactor, monitoring arrangements, some those especially restrictions will no

longer apply. so the link of that comprehensive agreement becomes very important. my own view is that the duration should be 20 years or greater. i think the iranians have in mind single digits, low single digits, and the sides are very far apart. so what's the outlook? president obama had mentioned is yoview that it could be about a 50/50 probability in the state of union. he also indicated that perhaps it won't be possible to reach a deal. i think, i think 50/50 may be optimistic. the issues are very wide. the differences are very wide, but i think it's possible with sufficient creativity on some of these issues to reach agreement. i don't see a agreement being reached in the first six months, the joint plan of action talks about the possibility of

extending the interim deal by mutual consent. at the same time it indicates that a final agreement has to be completed within one year. i think that's, those are the parameters, between six months and 12 months. i think any longer than 12 months i think there will be strong pressures, domestic pressures both in transit and in washington that this has taken enough time -- in transit and in washington and you have to complete it. so i will end it there, andy. >> thanks very much. thanks very much. there's a lot to chew on. please jot down your questions and get some of your so that i can then post them for our two speakers. there was one question that was asked me and written down before we actually started, and i'll just post the question here at the ousted. it was touched upon, bob come into final comment in this is question that pertains to

verification. and the question is, the questioner says she wonders whether he you could comment on the enlarged role that is foreseen for the international atomic energy agency under, in the interim agreement? for example, the question is, i think the implication here is what the agency be granted the necessary access that they need to answer some of the outstanding issues, the outstanding questions that have been lingering there for a number of years but as you mentioned, particularly access to the parchin military facility is where there is suspected possible military dimensions taking place. questions are pouring in. either of you just talk about that. >> under the joint plan of action, the iaea plays a major role. there will be a joint commission involving iran and the p5+1 countries that will look at implementation, both on the nuclear side and on the

sanctions side. so it will play a role. but the parties recognize that the iaea is the organization with the expertise to do the job. so i would look to the iaea as the principal actor on verification. on parchin and those issues, those are going to be hard your recently, the iaea and iran agreed to a kind of program of action, six steps, that are useful but they don't get to the military dimension aspects of the past. so this will be very hard but i think iran has to understand that it has to address iaea concerns or there will not be a final deal. >> i would just add what bob has said, and i agree with what he said. i think a lot of people remember when president reagan was negotiating nuclear arms reductions with the limitations with the soviet union back in

1987, president reagan said very same is fully -- said very simply, trust but verify. the verification in escape with a run comes with the iaea. a lot of people of modified what president reagan has said. iranian nuclear issue and i agree, don't trust. but verify. unique verification, and we trust the iaea. if it's fully empowered on a 24/7 bases to be the eyes and ears of the world to assure ourselves that the iranians are not cheating. but given the past record of the iranian government that bob and i have both spoken to, they have not been credible. or honest. they have hidden these facilities, fordow now being one example when president obama exposed in his press conference in 2009. so we can't trust the government of iran. we must verify. another final point. foreign minister zarif and others have put a spotlight on verification and said we will go

the extra mile -- i'm paraphrasing -- on verification. that's not going to be enough. because what is being verified is the critical issue. and we don't want to have a fully empowered and constructed centrifuge program to be verified. we want that such the program to be rolled back. we don't want the arak heavy-water reactor to be verified. as bob said, it's got to be transformed into a light water reactor, or dismantled completely. so the core of the negotiations will not be verification. the core of the negotiations is the main government willing to dismantle parts of its program? then you verify. the agreement that you strike with them. and that's the proper order of thinking about verification's usefulness. >> okay. we will go to some of the questions now. here's a very straightforward one, response i think, i think bob maybe to mention this.

the question is, what with the additional sanctions that were put in place yesterday? >> my understanding, i haven't been through the treasury trease announcement but my understand is that these were entities in a bunch of countries around the world, six, seven, eight, which were involved in mediation of the existing sanctions. so they weren't new sanctions. under the joint plan of action, the u.s. pledges not to impose new sanctions. these, involved in the execution of existing sanctions, but there are sanctions against evaders of the sanctions regime. and these various entities in six or seven.com including countries allied to the united states, were seen as deserving of this treatment.

the iranians predictably reacted against this, but the u.s. administration has informed them several times that the current commitment is not to impose new sanctions, new legislation, new executive orders and so forth, and that it will continue to implement existing sanctions. that is what was done. iranian's should have expected it. i think they're protesting in part to do with their own domestic audience. >> an interesting question. do you think that analogies can be drawn or lessons learned from north korea? that is, that can be applied to iran or vice versa. >> well, bob and i have both been involved, in my case, in

the clinton at bush administration, with a bitter expense with the north koreans. i was not involved in either negotiation directly, but i know it all good intentions in the world and the clinton administration with agreed framework of 1994, and i know president bush and secretary rice and a bass and chris hill did back in 2007 with that negotiation. i do think that there are differences year that don't, that make it difficult to equate the north korea situation with iran. north korea is a singular state run by a mafia family dictatorship. there's no other way to describe it, really. and they're all big and cut off from the rest of the world. they're cut off from the global financial system. and they seem to be willing to live isolated from the rest of the world for the glorification of the ruling family. the iranians are very different. iran is more of a civilization. very proud. it is a key country in the middle east. iran wants to be integrated with

the economies of turkey and the gulf and europe and north america and asia. and, in fact, that's been iran's traditional historic roll over many centuries. and so i see at least one of the motivations by iranian government here is to iran reenter the international system. they don't want to live in isolation and, therefore, i think -- and despite the fact that i disagree with almost every aspect of government govet behavior in tehran, it appears to be a highly rational regime and that's why it's important that at the negotiating table with the united states are china and russia and germany, france and britain, and supporting it are japan and south korea. iran but the answer to the entire world if it violates an agreement with the perm five countries. and i think the chances if the agreement can be negotiated, successfully, of then executing it successfully are far higher with iran than they were with that completely mendacious

regime in pyongyang. >> i would agree. i would just add something to the. people often ask me, is easy to sanction north korea or iran? the reality is, it's easier to sanction iran, and for some very simple reasons. north korea has one big benefactor, china. it's not prepared to let it go under. it's prepared to provide whatever food, fuel, for the support necessary to keep that regime afloat. iran doesn't have that. but iran has a crucial economic dependency, oil, the export of oil. which north korea doesn't have. north korea only makes one thing, trouble. but the iranians really are dependent on the export of crude oil, and it's been the ability to get countries around the world to cut back their purchases of iranian crude oil that's led to huge drop in oil

revenues, close to 60%. that's what has made a sanctions regime effective. and so that's why it's easy to put pressure on iran. and ironically than it is north korea. >> there have been a number of questions that have been submitted on your cards concerning the regional applications of where we go from here. let me read one of them. it says, clearly israel feels very threatened by these negotiations are what is the real risk to israel from these negotiations? can use shed some light on the concern? let me just add to that, with the saudis concerns are, if you want to add on to this question as well. seems to be some simultaneity of concerns by both the israelis and saudis about the negotiations that are going on. so let me just stop at that point. >> well, i think is most americans, i'm very sympathetic

to the situation that israel finds itself in as result of the arab revolution of the last three years, all of israel's borders have been destabilized. all more dangerous today than they were three years ago when -- particularly very worrisome trend of the signer with jihadi groups striking at the egyptian government and, of course, threatened to strike at israel. the weakening of jordan, the weakening of the border, the civil war spilling from syria over the border and golan heights and into lebanon, israel's northern border. so if you're an israeli, or if your prime minister netanyahu, you've got to be concerned. in addition to this prospect that the iranian government that has never sufficiently answered, you know, the blame from hostile rhetoric of the ahmadinejad government, they face an iranian regime that appears to be a mortal enemy. so one can easily understand the problems that israel has. i certainly believe that prime

minister netanyahu can put his faith and should put his faith in the president obama. israel has a great friendship with us, and we have been a very reliable partner to the israelis, defender of israel for 40 years. since henry kissinger transform politics in the middle east after the october war of 1973. and i would hope that the israeli leadership would give president obama but time and space to negotiate, and it appears that they will. the israelis will be in a very tough position should these negotiations fail and in a way, you know, as you build up leverage against the iranians, it's important that the iranians know that israel will defend itself but israel cannot live and should not live within iranian nuclear cannot pass the, and neither should the united states. i would hope the trend will continue to lead and israel will support the united states. and diplomacy be given enough time so that it might succeed.

bobob makes a good point. these negotiations might not succeed and that my require additional time. and if that's the case, and iran is well short of our red line, possession of a nuclear weapon, i would help israel would support, continued negotiations. and help the saudis would, too. i'm a private citizen, so i can say this. i've been very disturbed by the public attacks by saudi officials on the united states, and i'm president obama and secretary kerry. i've been very disturbed as have been many americans by members of the israeli cabinet criticizing in a very public, very open way secretary over the last few weeks. these two countries have a great friend in the united states and these are tense times. so i would hope the saudis and the israelis, governments, would give the obama administration the outright public support. because we need to be unified in facing iran. bob and i have both talked about

this, embarrassing spectacle of european politicians leading trade delegations to tehran over the last several weeks. we need the iranians to your tor united message from europeans, americans and the saudis and israelis. >> if you have more questions, go ahead. >> here's a question i see directed to you, nick. would it be a good idea to ask the iranians to allow a few americans, staff people, the staff the intersections in tehran? this is a question of engagement obviously eric this is a question which i'm no not sure quite understand but this is what happened in 2008 with the bush administration? why didn't they ask them? this is a question about more contacts, but also staffing an intersection in tehran with americans. >> well, i take my advice from

yitzhak rabin when his prime minister when he was explaining, i think back in the '90s, why he would sheikh arafat's hand in the south lawn of the white house. and he said something to effect, i'll paraphrase, you don't negotiate with your best friend. to negotiate with very unsavory enemies. and as a former diplomat, i teach diplomacy, i from the bleep do we have to be talking to our adversaries and our enemies. at the worst thing you can do from your own perspective, from your own national interest if you shut yourself off. so despite the fact i think we agree that north korea regime is odious, we have had a conversation with them. because it's in many ways a powerful regime and i think that the idea that the united states and iran were to establish a consistent channel, a very effective one and a very good one for our national interest. we don't give them a favor. we do ourselves a favor by having the capacity to be more intelligent about their country. that's part of what diplomats do. we live overseas, our foreign service officers on point and

difficult places, and we translate what's happening in the country for washington, and we haven't had that. so i entered the foreign service full-time in 1982, nobody in my generation went to iran. much less learned farsi. when i was the iran initiative for the bush administration, i never met an iranian diplomat. we weren't allowed to. there were no talks. i spent all my time sanctioning iran. so the fact that wendy sherman, our undersecretary of state, has had this opportunity to engage the iranians, the fact that secretary kerry has had the opportunity is good for us. it doesn't get -- it doesn't give anything away. it makes us better at negotiation. i do want to get public advice to the administration. i would trust the nsa should decide when the right time is to establish an intersection. i'm iranians would accept a. it's a paranoid regime. they have a distorted view of the united states. they don't tell the truth about us. that's why we need voice of

america and bbc and cnn to be broadcasting into iran because the iranian government distorts we are, but i trust the obama intersection to forget when the best time is. but the idea the jeff coston temptations and diplomatic representation makes perfect sense to me. >> just add, i completely agree with nick on that. interestingly, at this munich security conference last week, secretary kerry sat down with iranian foreign minister zarif. it hardly made the newspaper anymore. and i think that's a good thing because we need to have this dialogue. we need to understand what they are thinking. even if we have serious differences, and i think it's good that it's becoming more routine that americans and iranians sit down and talk. >> right, next question. since this is a congressional audience, largely so, this is an

questioned what of those damaging appendages steps members of congress could take to help or hurt the negotiations over the next six months? i know you don't want to advise members of congress but nonetheless, treat this as a very general question. >> i think it's a good thing that senators step back from a vote on the recently introduced sanctions bill. we all recognize the importance of very strong sanctions to motivate iran to negotiate seriously, and to reach agreement on an acceptable deal. but i agree with the administration that now is not the right time to impose additional sanctions. and in part because the particular sanctions bill that was introduced contain a number

of poison pills in it. you know, for example, it indicated that even in the next six-month if iran were to conduct a long range ballistic missile test, or to be seen as supporting directly or indirectly ask of terrorism, then we would be free no longer to implement our pledge that we wouldn't impose new sanctions during the six-month period. to me, that's not reasonable. ..