. people try to agree how much they will reduce the emission of various things, actually. not only this. to be convinced all you need to do is look at temperatures. they are writing. 2014 is the highest recording of temperature since recording of

temperature has begun. it's also the year when the highest number of natural catastrophes have taken place, natural disasters more food and water scarcity but generally fuel conflicts disputes wars. again, we need greater political courage to reach that comprehensive deal to cut carbon emissions at the paris summit in december. that brings me back to the beginning, and it's my conclusion. while i was thinking -- and thank you very much, you were listening -- during that time rosetta spacecraft continued to circle dark icy object that is comet 67p. as the comet proceeds closer to the sun we yet learn more of its secrets.

look at the mission that put together that unbelievable success. they were diverse. they came from different horizons. they didn't grow up together. i think diversity has had something to do with the success of that and it's certainly a true testament to global cooperation. policymakers should be inspired by that. you know, there are no real secrets. all we have found the rosetta a long time ago to actually identify what is needed for growth, what can engender it. to deliver on the three rosetta moments as i call them policymakers need to embrace a new multi-lateralism. it should be put into practice, whether it's applies to ccp or ttp or ttip or sdg.

you with me? this new miltu lateralism requires institutions credible representative of changing global economy. this is why back in 2010 decided it should better represent the global community. it should be endowed with more capital, quota in our institution and some underrepresented countries including big emerging market economies should have a bigger voice around the table. the imf membership has called on the united states to ratify the 2010 reforms by the end of last year 2014. this was a commitment made to the g-20 at the highest level.

but it hasn't happened. i've spoken much about leadership today, and i cannot but express profound disappointment in the political powers who have so far failed to grasp the benefits of reform both for their own benefit because maintaining stability around the world, making sure there are firefighters when something goes really wrong in any of those geopolitical areas that i've mentioned but also for the world at large. we have seen so much fabulous leadership out of this country. i hope i really hope that it is going to happen. absent that, we are now working on interim solutions to address some of the concerns that the other 187 countries have.

because they have ratified. they are ready. but it can't go unless the country that has veto power on all major decisions actually goes along. but given the challenges that 2015 and the following years will bring, i don't think there is an alternative to completing that 2010 reform. we will be trying to find interim solutions. we will be trying to address some of the issues but the real thing is the 2010 reform. that was actually very much engineered and advocated by the united states of america. so i will continue to call on congress to approve that reform without delay. and i have trust in this country. so i know it will happen. now, i would like to end with a quote that encapsulates my call for greater leadership and cooperation in service of the

global public good and that's a quote from -- i had to move away from egypt, you see. we talked a lot about rosetta so i'm turning to the greek ancient greek pericles he's known to say -- and he knew something about building, he knew something about architecture, no question about it. what you leave bin is not what's engraved in stone monuments but what is woven into the lives of others. well i think we have a lot of weaving to do this year. thank you. [ applause ] >> thank you so much for that. a lot of food for thought. i want to come back to some of the themes we started with if i may. you talked about the meteorites hitting the global economy.

you talked about strong head winds, some of the deep seated weaknesses particularly euro and japan and some of the down sides, but you didn't quite go as far as stating the risk of secular stagnation, which as you know, is a common theme. we were both at the committee meetings where some were saying this is the seminal issue of the day. of course by that we mean the lack of demand drives a lack of supply which creates a vicious circle that reinforces itself over time. is that one step too far in your point of view. do you not believe secular stagnation story or are there real risks when you put all your story together? >> what we see is so much diversity and fragmentation both at economic levels financial levels, at banking levels that

i hate to -- i don't like to use one single concept which is nice to have easy to mediatize, put your name on the headline right away. because i think it oversimplifies the matter. you know, there are different ways to look at the world. we at the imf are trying to drill down in each and every areas, each category. at the moment clearly the rise in the price of oil is knocking down so many certainties and creating new categories in many ways. you have the oil importers, the oil exporters. you have those that suffer the effect of the dollar because of where they are and whether they are pegged or not pegged, hedged or not hedged. there's a multiplicity of currency regulation. if you look at the euro and japan we have a clear risk of what i call the low low. i'm using different terminology

as well. i just don't want to be bound by what has been said by many men before me. [ laughter ] >> so too blank ate statement you would say. >> it's too broad for what we are seeing as more and more and more diversity in a world that continues to be highly -- it's quite fascinating because you have the two events, vast interconnections that continue, and you have more and more diverse situation locally and you have political and geopolitical tensions that are operating in also very, very different way with temptation by some or by some countries to retreat and retire to your own turf and mind your own business when there's an absolute need for a more collective approach. >> let's turn to one area where maybe there is more commonality. that is sort of low prices, low inflation, in some places

deflation. most people concern aggressive action, the ecb may take had to do with the fear of inflation, seems a far off fear at the moment. how well are economies equipped to deal with low inflation, maybe deflation. is the imf equipped? is that a risk in your mind since most companies are facing it. the oil price exacerbates that to some degree. >> exacerbated nominal inflation, when you look at core inflation and expectations of core in flation it doesn't have such an impact but it does at the nominal level. i think it's important to understand, you know, why despite the monetary policies we are seeing here or might be seeing elsewhere, there is nonetheless, either flat or very

low inflation relative to target set. it has to do with output. there are still in those countries, maybe less so and that's the reason we might see change in monetary policy but there are still available capacity, there are still people looking for jobs and who have, you know, the ability to join the markets. because of that i think we're not yet seeing an uptick. the oil prices still keeping that down. i'm not a central banker. if i was, i would look very, very carefully at core inflation and inflation expectations. in the two situations of exit or entering unconventional monetary policies. >> i literally have ten questions i could ask you but i'm not going to be selfish and turn for the last ten or so minutes to the audience and ask you for any questions you may

have. please introduce yourself your affiliation share your question. >> paula stern. i have my own consulting group stern group. brava for a wonderful presentation. my question goes back to oil and dropping prices and the roll of oil in the traded sector. it is commodity not subject to rules in the true sense of the word. are we at a place now where oil traded oil should be more subject to the rules of the road when it comes to our trade policies? >> you're raising a really interesting question. the sleepy competition lawyer inside myself is waking up

because, you know, while they are independent producers, it's also, there are a couple of other commodities that operate along those lines. it's a cocktail. there are many legislations around the world. cartels should not exist.. there are many legislations around the world. cartels should not exist.. there are many legislations around the world. cartels should not exist.. there are many legislations around the world. cartels should not exist.. there are many legislations around the world. cartels should not exist.. there are many legislations around the world. cartels should not exist.. there are many legislations around the world. cartels should not exist.. there are many legislations around the world. cartels should not exist.a. there are many legislations around the world. cartels should not exist.r. there are many legislations there are many legislations around the world. cartels should not exist.l. there are many legislations around the world. cartels should not exist. i'm not giving you exactly the answer but i completely take your point and i think there's a lot to be explored actually. there are other cartels that have disappeared over the course of the years because of the market forces. that might be an interesting one. >> madam lagarde, also a pleasure to hear you speak. first of all, i want to thank you for being such a strong

advocate and voice for women's empowerment. i really enjoyed your comments. i have a question for you, because it's something we're really struggling with you. it's totally indisputable, in my opinion, to achieve one if not all eight of the mullenium goals. when it comes to the post 2015 agenda and 20 year anniversary of beijing, we're still struggling with not the ñ#ou(u(áq'ess of gender equality. how we encourage multi-lateral institutions, governments to take this more seriously. atmosphere strategy not just a nice thing to do as you said. >> i agree with you that the aparns has largely been achieved achieved. i'm not sure the economic opportunities have been identified sufficiently on a

very precise basis because at the end of the day there is so much you can say about moral imperative. some people will turn their nose away and say only interested in economic results, bottom line or whatever. that's where we need to continue to document and demonstrate that it makes imminent economic sense. i'll share something with you. we started doing some very discreet work about the role of women in the japanese economy. it's an economy that combines two things -- three things. one, it's not particularly women friendly in terms of access to the job market. it's not especially immigration prone and it's aging. i mean, something has got to give, right? we documented and i presented on japanese television for over an hour with other japanese

academics. the value of women and how they can change the japanese economy over time. because you can stimulate by putting money as much as you want. if you don't have people to actually do the work, it's not going to make any difference. prime minister abe has completely endorsed that project. he and his wife actually, are really taking leadership and championing the cause. he has tasked his finance minister to identify enough budget to create child care centers and many more of them. i hope they are now going to soften the regulations on the private child care facilities, which is extremely rigid in japan. those are legal things that matter and financial support that matters as well. we will soon be publishing a study, we're doing that in

february, about the legal issues obstacles to the implementation of better access economic contributions by women. it's amazing. mitigations from the tax, design of income tax to the law to the ability to put a name on a property title. i mean there are lots and lots of elements that contribute to that. but i'm a firm believer you need a combination of a good policy framework, specific labor measures intended to facilitate access and financing. child care centers are not going to mushroom like that. they will need to be funded. >> let's take another question. way back there. thank you.

go ahead. >> thank you. the crisis seems to be coming back. to what extent does it affect the eurozone. to go back to your point about leadership, how do you think euro and the imf and the imf program relates to what happens next in greece? thank you. >> first of all, we are all in the waiting of the elections that are due on january 25th. as soon as that happens and there is stability in whatever government is formed as a result of those elections, we will pursue the discussions we've had with the greek authorities in order to help the greek economy to create growth, to have

sustainable and, you know, inclusive growth. the relationship with europe has been certainly better structured as a result of what the europeans have changed about the framework. the fact esm in place in order to avoid the contagion effect that could result from a major crisis in any country is one important factor. the current work done about stability and growth pact in order to allow countries to pursue physical adjustment but at the pace that is reasonable concerning the economic circumstances is also helping in that direction. but bottom line greece, like any other european country is going to have to go through structural reforms that are

needed in order to to sustain growth, create the conditions for invest mentment and for employment. it's common destiny i'll say. >> you, sir. >> father andrew from st. paul's. madam chairman, i'll give you another greek quote because we pray in ancient greek. all good things flow into the city because of the city's great nest. when said he was referring to the spiritual nature of athens, he wasn't referring to the temples and gold. and it was also referenced sparta because of the amazing utilitarian pottery they had which was not decorated because, again, the city had great soul. whether it's greece or whether it's portugal or whether it's

italy i'd like to know how you personally go with the human cost. i've held the hands of widows, old pensioners who committed suicide because all of a sudden their savings vanished overnight. how much does the imf really care about these things? >> well a lot. a lot. i can assure you. you have to bear in mind one thing, the imf is asked to come to a country when a country has created the circumstances where it's no longer handling its financial situation where it has not taken policy measures that should have been taken in order to maintain stability in its economy. so when i say that, i'm not trying to point the fingers at those policymakers over the course of time, but i'm just trying to say that one cannot associate the difficult efforts the huge sacrifices sometimes

that have been made by people with the institution. i wish i never had to go to greece portugal. we don't have a program with italy. but iceland, ireland, cypress. because if we didn't have to go there, it would have meant the policies in place decided by policymakers were good and maintained stability in those economies. that's point number one. point number two. when we helped design various reforms necessary for the country to restore its position, we are always mindful of the poor people of the safety nets that are needed. i'll give you a very practical example. the pension system in greece, the average pension in greece is the same as the average pension in germany. compare gdp not quite the same,

compare the cost of living, not quite the same. but when we suggested the reform of the pension system, we said below certain threshold, you cannot move the needle. you cannot change. you cannot put people in a situation where it's just too hard. so we have that in mind. we have in many countries actually reinforced that point by saying safety net is a need in your reform. we are, by the way, doing it also in all the reforms of the subsidy system. if you take a country like egypt, for instance, that is going through a reform of its subsidies to fossil fuel energy, they cannot remove the subsidies, because a lot of poor people rely on fuel to actually go to work or to do a little bit to get by. those people cannot suffer as a result of the subsidy reform. they need to use public

spending not in a uniform subsidization of energy but they have to use it to target those that actually need the money by doing cash transfers for instance, which is what we often recommend. >> i'm looking at the time very sadly and saying we're just a couple minutes over so maybe i'll wrap up with a final question. this has been a busy 12 18 months of authorship on the themes that are so important to the imf. if we think of the book martin wolf book, what lessons we've learned from crisis, the recent book you'll know them all as well as i will. is there one -- >> maybe you have time to read them. i don't read them all. i can't. >> fair enough. okay. is there one you think is particularly important for people who care about these issues a particularly seminal book? >> i'm back to your first question, is there one definition for the entire world?

i think to be well informed you have to read all these books or at least a good solid review of all of them and then pick and choose what your natural inclination takes you to and then the other one, because you need to have the dissenting views. you need to have different perspectives, otherwise you become narrow minded. i wish i had time to read them all. i will one day. >> someone will brief you, i'm sure. thank you all for your thoughts. [ applause ] >> there is a lunch outside, which the council invites to you participate in. >> we have a number of live events coming up on c-span3. next we will head to capitol hill for an update on the iran

nuclear negotiations. witnesses include newly confirmed deputy secretary of state anthony lincoln. that's scheduled to start in a few minutes live here on c-span3. we'll hear from sacramento mayor kevin johnson, he's the president of the u.s. conference of mayors. that will be live starting at 12:45 eastern. at 2:30, the house science committee hears about research conducted by faa and nasa regarding how to integrate drones into the national aerospace system. again, that will be live from capitol hill starting at 2:30 eastern. this afternoon, the day after his state of the union address, president obama will head to boise, idaho, speaking about proposals in his speech. live at 5:00 p.m. eastern here on c-span3. the headline in the minneapolis star tribune says the senate panel begins showdown with obama over negotiations on the iranian nuclear deal. the story says senators are

pushing to have a say about ongoing international negotiations aimed at preventing iran from developing nuclear weapons, a move that will further destabilize an increasingly volatile middle east. working on legislation that would allow an up or down vote on any deal the obama administration reaches with tehran. that hearing will be live on c-span3 in a few minutes, focus on the status of those negotiations and the role of congress. we have another bill pending on capitol hill that would leafvee sanctions on the bill. here is president obama last week asking congress to hold off on legislation dealing with iran and let the negotiations play out. >> take this very seriously. i don't question the good faith of some folks who think this might be helpful. but it's my team that's at the table. we are steeped in this stuff day in, day out.

we don't make these judgments blindly. we have been working on this for five, six, seven years. we consult closely with allies like the united kingdom in making these assessments. and i'm asking congress to hold off because our negotiators our partners, those who are most intimately involved in this assess that it will jeopardize the possibility of resolving -- providing a diplomatic solution to one of the most difficult and long-lasting national security problems that we've faced in a very long time. and congress needs to show patience. with respect to the veto i said to my democratic caucus colleagues yesterday that i will veto a bill that comes to my desk. and i will make this argument to the american people as to why

i'm doing so. and i respectfully request them to hold off for a few months to see if we have the possibility of solving a big problem without resorting potentially to war. and i think that is worth -- worth doing. we'll see if how persuasive i am. but in i'm not persuading congress, i promise you i'm going to be taking my case to the american people on this. press tv says that china is indicating iran and p five plus one made progress during latest negotiations islamic program hoping for conclusion of the nuclear deal to the parties to the talks as soon as possible. since an interim deal was agreed to in geneva in november of 2013, the negotiating sides have missed two deadlines to ink a final agreement. the talks have been extended to jewel with a goal of reaching

framework on a deal by the end of march. again, we are live on capitol hill senate foreign relations committee, nuclear negotiations with iran. witnesses include newly confirmed deputy secretary of sate who was recently national security adviser to the president. also testifying today expect to hear from david coen, discuss the impact of economic sanctions. el recently selected by president obama to be the next cia deputy director.

>> let the international community have a chance. let the international community -- californians are here today to ask you to please not continue with new sanctions on iran, postpone the vote until after negotiations have taken place. ranking member menendez it's incumbent on to you keep the peace, keep the peace in the area area. [ inaudible ] >> i ask to please listen,

cannot continue sanctions on iran, we need less diplomacy not more. i don't want to take any of the senator's time after the hearing starts but the public needs to be heard on this issue. we want no new sanctions. even debating sanctions in iran is a mistake. people from california want diplomacy not new wars not new sanctions. >> new sanctions will undermine diplomatic efforts. >> i'm going to call the meeting to order. i would say to people in the

audience that we would appreciate you refraining. we understand people have strong emotions about much of what happens in this committee and others and we hope you'll respect the work of the committee. i have never operated a gavel. i learned as a young man how to operate a hammer. i understand my staff told me to be a little more gentle with this, but i want to welcome everybody to the committee. we've switched sides. that was not symbolic. i understand just because of the number of seats it works better this way. i do want to welcome the new members of the committee and say that under senator menendez's leadership, i really believe that this committee has caused it's profile to rise. we've passed a number of very important pieces of legislation

out of this committee, andening it's because of of leadership it can happen. i wan to thank him for that. i want to say to all the committee members we plan to certainly build upon that. we have a number of very important issues to deal with. a nation has put its truth in us to deal with issues in a sober way. i think the issue today that we'll be talking about really causes us to remind ourselves of the indispensable nature of u.s. leadership. i think the committee has, like any committee, we have important things to deal with and we have urgent things to deal with and we need to do both. the important for us to continue a committee to show the importance of u.s. strategic engagement and how that improves

our economy and makes us safer at home. at the same time we need to make sure our taxpayer dollars are spent wisely. while it will take some time to build, i like for us to work towards a state department authorization. i think all of us know we haven't passed one since 2002. what that means is the state department is basically operating off of policies we passed 13 years ago. if we really want to leverage our efforts, what would make sense, i look forward to working with ranking member menendez in a certain way would be to make sure what the state department is doing is leveraging those kinds of things we would like to see happen. i don't want to shy away from difficult issues. this first hearing is evidence of that. i wan to make sure the views of all committee members are heard. i want to make sure we strengthen our nation in the process. today we're here to talk about

iran. i want to say to our witnesses thank you for being here i think there are legitimate concerns by almost everybody on this committee and it's not in any way disloyal, it's not an infringement on anybody else to say we have legitimate concerns. when you think about where we are in iran negotiations, we have six security resolutions, u.n. security resolutions that call for full suspension of enrichment, we then move to the standard called practical needs. in other words, if you're in iran and you have -- if you want to do enrichment, even though in violation of security council resolutions what is the practical need for the country. by all estimation that's maybe 500 centrifuges yet we know the negotiations have moved way

beyond that. we know that. we talked about dismantlement, we have concerns about what that means. some people say it's disconnecting the plumbing to use very coarse terms. we spend time talking about hour one and two talking six, way beyond that. it doesn't speak to ballistic missile development, significant concerns for all of us. we believe, although i'm not sure this is the case. i had a meeting last night and maybe this is not true. i know some of you can enlighten us here today but we're concerned about what we're really going to cause iran to do relative to their past military intentions. most of us think they are way

down the road since 2003 and we'd like to understand the type of technology they have developed. and i know this and y'all have shared this with us in all kinds of meetings they still are stiff-arming iaea relative to access to many of their facilities which obviously continues to cause us to have great concerns about their trustworthiness. i think all of us know they are destabilizing the region. we watch what happened in yemen, hezbollah and iran. we watch what's happening with hamas. we know they are even with the minor amounts of money that has been lessened from the sanctions regime that senator menendez and senator kirk and all of us work together to put in place even with that minor amount of money, we know that that has enhanced their ability to destabilize the region.

we know that. you can imagine if we end up with a really bad deal that ends up creating a nuclear arms race in the region and makes the world less safe and yet much more money is released, they can even destabilize the region more. so obviously there's significant concerns. i'm proposing some legislation, and i look forward to hearing from y'all today. we're vetting it with people on this committee that builds off the one, two three agreements that we have in place right now. senator markey is familiar with this. 27 times this nags has approved a one two, three agreement with another nation under civil nuclear arrangements. y'all reach an agreement with a country and we approve it. secretary kerry came in and said he wants to make sure any agreement that happens passes muster with congress. i'd like to understand today how you'd like to see us pass muster. one way to do it is an up or down vote. i know there's been a lot of

discussions. i know senator menendez will speak to this. a lot of discussions about what we might do and might not do. i've talked to prime minister cameron. i talked to the uk -- excuse me european union negotiator last night in my office. some of us were in israel this weekend over this very same issue. we have heard no one, no one say that if congress were to weigh in on the final agreement it would have anything -- it would in any way destabilize negotiations. as a matter of fact, we understand iran's parliament may have to approve their agreement. so i hope today you'll share with us the appropriate role for us to play. we obviously have our own thoughts. we thank you for being here. with that i'm sorry to give such a long opening comment to ranking member menendez. >> thank you mr. chairman. let me also welcome colleagues on the committee.

it's an extraordinary committee to serve on confluence of national economics of united states, in a global context as well as major issues for which america is exceptional on democracy, human rights, among other issues. i welcome you. i think you'll find an extraordinary experience of since this is the first hearing that we've had of the new committee, i want to congratulate the chairman on his ascendancy to the chairmanship. during the two years i was chairman we worked extraordinarily well in a collaborative fashion and in the midst of partisanship in the senate as a whole this committee was an island of bipartisanship on so many major issues that overwhelmingly passed the committee in almost every instance with strong bipartisan support. we look forward to working with you in the same context, same

comity and same goals at the end of the day. we look forward to you having a very successful chairmanship of the committee. i want to in the context of the hearing say that i shared your concerns that the iranians are playing for ñf&ñtime. over the past 18 months, we have been moving closer to their positions on all key elements. on the iraq reactor, on enrichment and iran's disclosure of the military dimensions of its nuclear program. i think we need to review how we got to this point. iran over the course of 20 years deceived the international community and violated not u.s. but u.n. security council resolution toss arrive within

weeks of achieving nuclear breakout capacity. iran came to the table only after the cumulative impact of years of sanctions began to affect the region's economic and political stability. for us to give up the leverage of sanctions, which would take years to reimpose, we need a deal that truly reverses their nuclear program rather than just buying a little time. this is why i'm concerned about more than breakout time. i'm concerned the agreement won't provide a clear picture of the military dimensions of iran's program, which are critical to understand to know how far down the road they were as it relates to weaponization so we understand the time frames of any breakout capacity vis-a-vis weaponization, so we

know just how close iran is being to make a nick weapon. i'm concerned instead of dismantling and closing iraq and fordot as we were told by the beginning of the administration the iran iraq reactor will be converted and the facility built under a mountain which i don't think you do for civilian purposes, will be repurpose. after 18 months of stalling, iran needs to know there will be consequences for failure. some of us think that should be -- iran playing an asymmetrical game violating, in my view the spirit and intent of sanctions. in november iran violated interim agreement by feeding iranian gas into it's irr

centrifuge at the research facility. the issue whether it's a violation of the interim agreement is only an issue because at the time of the interim agreement ir 5 had not been used tore enrichment and, hence, the agreement only prohibited iran from making advances on the ir 6. that is spin if i've ever heard it. but in any case, the action clearly violated the intent of the agreement֖sw to halt enrichment advances at and violated security resolutions. it's interesting to know talking about verification agreements should we be able to get an agreement, it was a group of sign advertises outside of the administration that noticed this and were the ones to inform the administration about it. so that makes me worried about how the verification process is

moving forward. in december the u.n. panel of experts that monitors sanctions compliance said in a report that iran has been illicitly trying to by technology for the research reactor, which as originally designed would produce plutonium for a bomb and has been referred to by experts as a bomb making factory because of the quantity of plutonium output. under the interim agreement, iran agreed to make no further advances in the construction at arak. iran's position any purchases alone would not contravene the agreement only new construction. well, if you believe that, i have a reactor to sell to you. just last week iranian president rouhani announced construction had begun on two new nuclear reactors at bashir. while not a technical veelgs of the joint plan of action, the announcement is clearly intended

to leverage further games in the negotiation. the very next day the iranian regime announced "washington post" correspondent who has been in prison for 178 days had been referred to the revolutionary court that handles sensitive national security cases. as "the washington post" said in a recent editorial it's difficult to avoid the conclusion that he's been used as a human pawn in the regime's attempt to gain leverage in the negotiations. we have this whole alternate track the iranians can cheat on. because it's technically not in the joint plan of action, well we don't call them on it. that's a great opportunity if you can get it. you can advance your interest out of the jpoa and quote, unquote, not violate jpoa. let me close by saying iran is clearly taking steps that can only be interpreted as provocative, yet the

administration appears willing to whisk away connection between these developments and signs of iran's bad faith negotiations. it seems we are allowing iran to shuffle the deck and deal the cards in this negotiation that we're playing dealers choice. frankly, that's not good enough. we need to get into the game. now, up until now iran has not been motivated sufficiently to make tough decisions. and i hope there will be an agreement in march. but i also believe we need to make clear there are consequences to no deal or to a bad deal as senator corker is referring to, and i'm intrigued by his most recent concept of legislation. so mr. chairman, thank you for holding the hearing and i'll look forward to hearing from our witnesses. >> thank you mr. ranking member. i'm not used to calling you that. to the other members i'm going to say we don't normally give those comments on the front end. they are usually shorter. this is obviously one that

evokes a lot of concern. we're going to be having -- the committee will operate by early byrd rule. if you're here when the gavel goes down, you'll know what order you're in. we've watched people coin and sit and wait as other people come in and out. but in order to show we're not going to be totally rigid i know that senator boxer has a meeting. we don't normally have other opening comments. she's not going to ask questions later but since she has to go to another meeting she wanted to say a couple of words on the front end. i'm going to allow her to do that. >> mr. chairman thank you for your generosity of spirit. senator inhofe called our organizational meeting for dpw down the hall and i have to be there. i so appreciate this. i want to thank both my chairman and ranking member now for this hearing. we're all here today with the same goal. and that is to prevent iran from acquiring a nuclear weapon. but we have different thoughts about the best way to do that. and that's why this hearing is so critical. and we welcome the witnesses, as well. what we have a historic opportunity to peacefully

achieve this goal. and to me it seems like you've got to give this diplomacy a chance to work. i think it's only common sense as president obama said war should be a last resort not a first resort and a peaceful end to iran's nuclear program, i believe, is in the best interests of america and in the best interests of our great ally israel. and that is why i'm concerned and it's not partisan. i have a concern that reaches across party lines that some colleagues are pushing to enact new sanctions while our negotiators are still at the table. i don't believe that strengthens us. doesn't strengthen our position at all, and these negotiations are going on right now. in fact i think if we enacted that legislation we would jeopardize a chance a once in a lifetime perhaps chance of having a far reaching final comprehensive agreement, which we know is going to be hard.

our own president has said it's a 50/50 chance. he's not you know wearing rose colored glasses on the point. our own intelligence community said, and i quote new sanctions would undermine the prospects for a successful comprehensive nuclear agreement with iran. unquote. and passing new sanctions legislation would threaten the unity we have achieved with the world, and that is critical. i want to quote british prime minister david come ran who said last week quote as a country that stands alongside america in these vital negotiations it's the opinion of the united kingdom that further sanctions or further threat of sanctions at this point won't actually help to bring the talks to a successful conclusion. they could fracture the international community that has been so valuable in presenting a united front to iran. and i think a new sanctions bill would give iran an excuse to walk away.

i think it says to iran to the hard-liners, you see you can't really deal with america. now, in the end they may not be able to, and we may not be able to either. it's all -- life is about timing. we all foe that. we ran we got our seats because of timing. everything is about timing. and this is not the time. so, in closing let me say i oppose the legislation i've seen so far. i haven't seen the new proposal. i look forward to seeing it. but i am working on legislation with senator paul to send a clear, unequivocal signal that iran will be held accountable for its actions, and any failure to fulfill its commitments will be met by swift action by congress. so our bill in essence would allow expedited consideration by congress of legislation to reinstate waived or suspended sanctions against iran if the

president in consultation with the intelligence community, determines that iran has violated any existing nuclear agreement. senator paul and i are putting the final touches on this bill. we think it's a moderate proposal. we think we're going to see perhaps three options. one option which would essentially do nothing but have a series of findings which i don't think goes far enough and one that perhaps moves too quickly towards sanctions. so senator paul will be working on that with me. we're very excited to share it with our chairman and ranking -- mr. chairman i thank you so much for this opportunity. >> just to be clear before we move to the witnesses there's been a lot of confusion about what this committee does. and what the banking committee does. any sanctions legislation it's been determined will be dealt with in the banking committee because of the treasury functions. so this committee i think will be looking at ways for congress to weigh in and one of those is

just for us to approve up or down the final deal which is what we do every civil nuclear deal that comes our way. certainly this is of greater importance. but with that i want to thank everyone for their comments. i want to move to the witnesses, thank you for your patience. our first witness is tony blanken the deputy secretary of state. mr. blinken confirmed his post after being confirmed by the senate in december. he is a former deputy national security adviser to the president and has previously served as the democratic staff director of this committee. from 2002 to 2008. welcome back. our second witness today is david cohen, the undersecretary of treasury for terrorism and financial intelligence. mr. cohen has been in his position since 2011. and has recently been appointed deputyputy director of the cia. he has previously served as assistant secretary of the treasury for terrorist financing, where i think he's done an outstanding job. i want to thank you both for being here and sharing your

thoughts and viewpoints with us today. we would remind you that your full statements without objection will be included in the record. if you could keep your remarks to around five minutes, we would appreciate it. i know there will be numbers of questions. so thank you again for being here, we look forward to your testimony. >> mr. chairman ranking member, thank you very much for having us here today. mr. chairman congratulations to you on assuming the chairmanship. i'm very glad you're wielding the gavel, not the hammer but very much look forward to working with you the ranking member and all the members of this committee going forward. and i think it's very appropriate that you are starting the hearings here today in this congress on the subject of iran the nuclear negotiations. it's an issue of paramount importance to our national security and an issue that we've labored on with congress for years. secretary kerry undersecretary sherman as you know, and our entire negotiating team were in geneva last week as part of the effort to get to an agreement where iran's nuclear program we can be sure is used for

exclusively peaceful purposes. and i want to talk to you about where we are with that today. i'll give you as much detail as i can. it may be appropriate at a later stage to do some of this in a closed setting, given that the negotiations are ongoing. and it's hard to get into some of the detail in public without undermining our negotiating position. we remain committed to continue and indeed when necessary to expand the regular consultations we've had with congress and particularly with this committee on these negotiations. we share the same goal, to make the world a safer place by resolving international community's concerns about iran's nuclear program. our core goals for the negotiations are clear, and consistent. any agreement we reach must effectively cut off the four pathways iran has to obtain enough fissile material for a nuclear weapon. the two uranium pathways a plutonium pathway through the iraq heavy water reactor and a potential covert pathway. any agreement must require stringent access, monitoring,

transparency measures to mox mize the international community's capabilities to detect quickly any attempt by iran to break out overtly or covertly. any agreement must give us confidence that should iran choose to break its commitments it would take at least one year to produce enough fissile material for a bomb. and any agreement must deal with some of the issues that you and ranking member menendez alluded to, including the missile question, r&d, possible military dimensions of the program et cetera. and we can talk about that in questioning. in exchange, the international community would provide iran with phased sanctions relief. tied to verifiable actions on its part. such relief would be structured so that the sanctions could be quickly reimposed if iran were to violate its commitments. the discussions last week with secretary kerry in our judgment were substantive, they were serious, we've made real progress on closing some of the gaps that separate us. but at the same time real gaps remain. i'd be happy again to provide further information on exactly

where we are along with ambassador sherman and others in a closed setting so we can go into more detail. overall our assessment remains that we have a credible chance to reach a deal that's in the best interests of america's security, as well as that of our allies and partners. our goal is to conclude the major elements of the deal by the end of march. and then to complete the technical details by june. in our judgment we're negotiating from a position of strength. in the past, iran has used the cover of talks to buy time and advance its program in significant ways. thanks to the interim agreement we've reached, the joint plant of action, iran's program was fundamentally frozen in many key respects, rolled back in some others and international inspectors have given extraordinary access. before the japoa japan had about 200 kilograms of 20% enriched uranium in a form that could be quickly converted into weapons grade material. it produced much of that material at the facility which is buried deep underground.

dhahran has no 20% enriched uranium. zero, none. it has diluted or converted every ounce, suspended all uranium enrichment above 5% removed the connections at fordow that allowed him to produce the 20% in the first place. before the japoa iran was making real progress on the iraq reactor which, had it become operational, and together with the reprocessing facility would have provided iran with a plutonium path to the bomb. once fuelled the iraq facility would have been very challenging to deal with militarily. today, iraq is frozen in place. no new components, no testing, no fuel. before the japoa iran had installed roughly 19,000 centrifuges the vast bulk 6 them at the natanz facility. today 9,000 of these are not operational. iran has installed no new centrifuges. and its stockpile of 4% low enriched uranium is capped at its pro-japoa level. before the japoa inspectors had less frequent access to iran's nuclear facilities.

today it's enabled iaea inspectors to have daily access to iran's enrichment facilities and a far deeper understanding of its nuclear program. its centrifuge production its uranium mines and mills and other facilities important to monitoring the program and detecting any attempts to break out. the iaea has consistently reported that iran has lived up to its commitments under the japoa. just as we've asked iran to live up to commitments we've lived up to our commitment to provide iran with limited relief about $14 billion to $15 billion from the start of the agreement to this june when it ends. and david cohen can talk more about that. but that relief is dwarfed by the vast amounts denied to iran under existing sanctions regime we're vigorously implementing. the entire sanctions architecture remains in place and david can talk about that. congress as has been mentioned is now considering legislation to impose additional raungzs on iran should negotiations fail. let me say at the outset i know the intent of this legislation

is to further increase pressure on iran and in so doing strengthen the hand of our negotiators and strengthen our leverage. we very much appreciate that intent but it is our considered judgment and strongly held view that new sanctions at this time are both unnecessary, and far from enhancing the prospect of negotiations, risk fatally undermining our diplomacy, making a deal less likely and unraveling the sanctions regime that so many have worked so hard to put in place. they're unnecessary, because as i noted a moment ago and david will go into more detail on this, iran already is under intense pressure from the application of the existing sanctions, in recent months that pressure has actually grown stronger with the dramatic drop in oil prices. should iran refuse a reasonable agreement or cheat on its current commitments under the japoa the senate could impose additional measures in a matter of hours matching or going beyond what the house has already passed. the administration would strongly support such action. iran is well aware that a sword of damocles hangs over its head. it needs no further motivation. so the sanctions new sanctions

at this point are not necessarily but we also believe their passage now would put at risk getting to a final deal over the next several months. let me very briefly explain why. as part of the japoa we committed within the wounds of our system not to impose new nuclear related sanctions while the japoa is in effect. absent a breach by iran any new sanctions enacted by congress would be viewed by iran and the international community as the united states breaking out of the understandings of the japoa. this in our judgment includes so-called trigger legislation that would tie the actual implementation of new sanctions to the failure to reach a final agreement. even if it is not arguably a violation we believe it would be perceived as such by iran many of our partners around the world. the intelligence community believes the same thing. so do our key partners including theic, france and germany. this could produce one of several unintended consequences that far from enhancing our security in our judgment would undermine it. first the passage of new sanctions could provoke iran to leave the talks violate the

japoa and pursue its nuclear program full tilt. reversing all of the benefits we've achieved under the jan owe wa. and i can go through those later. even if iran does not walk away or returns promptly to the table negotiators are luckily to adopt much more expeople positions in response making a final agreement much harder to achieve. third and finally if our international partners believe that the united states has acted prematurely through initial nuclear related sanctions legislation in the absence of a provocation or violation by iran, their willingness to enforce existing sanctions, never mind add additional sanctions later in our judgment will wane. their support is crucial. without it the sanctions regime would be dramatically diluted. we've kept countries on board through a lot of hard work despite being against the economic interest of many of them. we're serious about diplomacy and trying to reach an agreement that advances our security. if they lose that conviction the united states and not iran would be isolated. the sanctions regime could

collapse and iran could turn on everything it turned off under the jpoa with no consequence. we can debate whether any of these things would happen, whether all of these things would happen. what i can tell you is this those that we believe are best placed to know, that is the folks who have been engaged with the iranians engaged with our international partners, in these negotiates for several years now, that is their best judgment. judge run these risks and jeopardize the prospects for a deal that will either come together or not in our judgment there is nothing to be gain and potentially lots to be lost by acting precipitously. as senator boxer noted this is a judgment shared by many of our key partners. she cited prime minister cameron and his remarks. i think you'll hear the french the germans and others make similar statements in the coming days. one final point. even if we resome the challenge posed by iran's nuclear program, i want to assure you that we will continue to confront iranian actions that threaten our security, and that of our

partners including its support for terrorist groups its efforts to proliferate, its destabilizing activities in the region. we will continue to spotlight and oppose its violations of human rights freedom of expression, freedom of religion and we will continue to defend and build the capacity of our partners from israel to the gulf countries, to counter iranian aggression and provocations. thank you very much, mr. chairman. mr. cohen mr. blinken was very fulsom in his comments about double over. if you could sort of keep it to five, it would be good. thank you. >> certainly. good morning chairman corker ranking member menendez, distinguished members of the committee. thank you for the invitation to appear before you today, and as this is likely my last appearance before this committee before i assume my new duties i want to thank former chairman menendez, current chairman corker and members of the committee for the courtesy that has been shown to me over the past several years. i appreciate it.

there is no higher national security priority than ensuring iran does not acquire a nuclear weapon. and president obama has made clear that we will do everything in our power to prevent that from happening. for us at treasury that has meant working within the administration with congress and with international partners to impose the most powerful sanctions in history. and in many respects the sanctions have worked exactly as designed. they have driven iran to the negotiating table. because iran's leaders know that relief from sanctions can come only innics change for taking steps that will guarantee that iran cannot produce a nuclear weapon. as we sit here today no one knows whether the negotiations ultimately will yield a comprehensive deal. but we, like you, are dedicated to testing fully the diplomatic path. as we do so iran's economy remains subject to intense pressure from sanctions.

under the point plan of action which has been in effect for a little over a year now iran halted progress on its nuclear program, rolled it back in key respects, and allowed unprecedented inspections of its enrichment facilities. in exchange iran received limited and reversible relief from some nuclear related sanctions. importantly, the jpoa left in place the full architecture of our financial, banking, oil, and trade sanctions. our terrorism and human rights sanctions. and our domestic embargo. this means that iran is still cut off from the international financial system. it is unable to export even half the oil it was exporting in 2012 and it is barred by sanctions from freely accessing most of its oil revenues in foreign reserves. these sanctions are not just words on the books we vigorously enforce them. since the signing of the japoa in november 2013 we have designated nearly 100 iran related targets and imposed over

$350 million in penalties for sanctions of asia. put simply iran still is not open for business, and its economy remains in a deep hole. let me cite just a few metrics. in 2014 alone our sanctions deprived iran of over $40 billion in oil revenues. that is well over twice the total estimated value to iran of the japoa sanctions relief. altogether since 2012 our oil sanctions have cost iran more than $200 billion in lostu:ñ exports and oil proceeds it cannot access. iran's currency the rial is depreciated by almost 16% just since the signing of the japos and 56% since january 2012. and iran's economy today is 15% to 20% smaller than it would have been had it remained on its pre2012 growth trajectory. because of the scope and intensity of the sanctions iran currently is subject to and

because of the economic pressure those sanctions continuethan $200 billion in lost because of the scope and intensity of the sanctions iran currently is subject to and because of the economic pressure those sanctions continue to apply iran is negotiating with its back against the wall. accordingly we see no compelling reason to impose new sanctions now, even on a delayed trigger. we think new sanctions legislation is more likely to be counterproductive than helpful in the negotiations. dhahran's nuclear program is frozen in its economy and thus its negotiating team remains under enormous pressure because we've been able to hold together the international sanctions coalition. enacting new sanctions now threatens to unravel this. if congress enacts new sanctions now and the negotiations ultimately prove unsuccessful our international partners may blame us not iran for the breakdown in the talks. overall support for the sanctions regime would then decline making it more difficult to maintain or to intensify sanctions pressure. and if a break down in talks led

to the demise of the gentleman poa we would lose the additional insight into iran's nuclear program and the restrictions on development that the japos has given us. make no mistake this administrationion stands and embraces the power of sanctions. sanctions are a key component of many of our most important national security initiatives. we are not sanctions doubters. but neither do we believe layering on additional sanctions is always the right move. sanctions are one tool in our tool kit alongside diplomacy, military action, and the myriad other ways that we project power. if diplomacy does not succeed the president said he, quote will be the first one to come to congress and say we need to tighten the screws. but in our view now is the time to give diplomacy every chance to succeed not to create a new sanctions tool. thank you and i look forward to addressing your questions. >> thank you both. and, again i just want to make sure everybody understands this committee is not the committee

that deals with sanctions. and i know the witnesses certainly have the opportunity to say anything they wish in. . that is not the issue that is before us. i'm sure you may get some questions about things other than iran today and people will use this venue for that. but i would just like to to ask this question of mr. blinken. do you believe congress has any role at all to play in these negotiations. short answer, if you would. >> yes, i do, mr. chairman. in several ways. first, we wouldn't be where we are without the role that congress has already played. i think the sanctions that have been imposed to date are what brought iran to the table. and our ability to bring the international community along has been critical to that endeavor. second i think it's absolutely vital that we remain in close consultation with you as the negotiations proceed. we've had the opportunity in various closed sessions and briefings to do that. we want to continue that.

finally, if we get to the end game and if we do get a resolution in our judgment, the best way to ensure that iran complies with its obligations would be to suspend the existing sanctions, not end them to test iran's compliance, and only then, and obviously congress would have to play a lead role in this, to actually end the sanctions. so, all along, from the beginning to where we are now, to an agreement if we reach one, congress' role is central. >> thank you. i think one of the things that we all know is when the sanctions were put in place we gave the administration some national security waivers, and you've utilized those. i think all of us also know that once you suspend these in more depth and you agree to do that with the p-5, in essence what's going to happen is the entire regime is going to fall apart. and so i sent you some legislation, i'm very disappointed you didn't address that today in your opening

comments that would just allow us, we do not want to do something that infringes upon getting to a good deal. and so we've sought to figure out some way for congress to be able to weigh in before you dismantle, before you dismantle over a longer period of time with this national security waiver the entire regime. we've asked, is it appropriate for us to at least be able to

all, how much we really appreciate your leadership on this, and the intent of what you're proposing. as someone who as you alluded to before worked on this committee for six years i also fully understand the desire for a congress to have some kind of up or down vote on whatever is agreed to. from where i sit now. i think you'll also understand the position of the administration for that matter any administration republican or democrat, on the importance of maintaining the executive fqq)ogative to conclude agreements that advance our national security interests and do not require formal congressional approval. there's a concern that this could set a precedent for future executive branch action. this, to us, would be i think a unique arrangement. it will not be a treaty. or other type of international agreement where all parties are required to take similar actions themselves. it will not be like an arms control agreement that imposes obligations on the united states and our nuclear weapons policy. and it's not exactly akin to a

one two three agreement because in this case we have multiple partners at the table on an issue obviously of tremendous complexity. rather this would be the international community putting strong limits on iran's nuclear program, and iran agreeing to adhere to those limits. but as i said earlier, just as congress played a key role in getting us here -- >> sir, if i could i think the answer is no. so, let me -- let me -- you know we could easily deal with this by just passing legislation that does away with national security waivers. then you'd have to come to us. >> yeah. >> so, i don't understand. you know, you've talked about the sanctions piece. i've talked to our french negotiators directly. i talked to our uk negotiators directly. i talked to prime minister cameron directly. i talked last night at length in my office to the negotiator on behalf of the european union.

i was in israel this weekend, talked to the intelligence agencies there. i talked to the prime minister. i have met no one who believes that us weighing in would do anything to destabilize these negotiations. as a matter of fact many have said knowing that congress has to approve the deal would be a great backstop for the administration to strengthen their hand, just as the negotiators in iran continue to refer to the hard-liners, and to khamenei, the supreme leader. again we could just do away -- we were generous in the passage of these sanctions giving you a security waiver. we could actually just do away with that and you'd have to come to us. so why would you oppose congress weighing in on an issue of this importance, and isn't power for you to say you want this to pass muster or secretary kerry to say this should pass muster and yet continue to stiff arm every effort be pushed away, congress

who represents more fully this nation than the negotiators, not having the ability to weigh in on this deal? >> mr. chairman let me suggest a few concerns that could materialize. first, in terms of the negotiations themselves, the knowledge that there would be very early on this kind of vote in our judgment could actually undermine the credibility of the commitments we would make in the context of negotiations to suspend, not end -- >> does the iranian parliament not need to weigh in on some of the agreements that iran is putting in place? >> under their laws they may be required to. that's correct. >> okay. so so on one hand we would negotiate in such a way as we know that the supreme leader could try to influence the iranian parliament to go against what they may agree to. and yet you would say here it's not important for the greatest deliberative body in the world quote, quote, quote, to be able to weigh in on this issue,

matter of fact, the body that actually put to the this regime that the entire international community is building these negotiations off of. >> let me -- let me suggest that two things. first there's a concern that if a judgment is reached immediately, yea or nay on this it may be too soon to see if iran has complyied with its agreements. if iran had been asked to vote on the agreement i suspect many who believe the agreement has produced very strong results for our security initially were skeptical might well have voted it down. i think giving the iranians time to demonstrate clearly to you, and to us, that they're making good on their commitments would make sense. second, i actually think our leverage is enhanced and congress' leverage seine hansed if we suspend sanctions initially if we get an agreement and then once iran has demonstrated that it's making good on its commitments congress

acts and takes the actions necessary. i think we have stronger leverage doing that than pronouncing ourselves immediately until we see whether iran is making good on its j%áp commitments. >> well my time is up. but i would support a series of votes if that's what you're saying. i would support an initial vote on the deal, as a whole. and i think congress would be more than glad to work with you on a series of votes as you move along. i will say mr. blinken, after having served on this committee, and after y'all spending incredible amounts of time dissing the sanctions regime which we are not focused on we're trying to find a constructive way for congress to play its rightful role in these negotiations. i'm very disappointed that in essence what the administration is saying is we really don't want, even though congress put us in this place we really don't want congress to play a role in one of the most important geopolitical agreements that may take place during this administration. with that, ranking member

menendez. >> thank you, mr. chairman. you know, i have to be honest with you the more i hear from the administration and its quotes the more it sounds like talking points that come straight out of tehran. and it feeds to the iranian narrative of victimization when they are the ones with original sin. an illicit nuclear weapons program, going back over the course of 20 years they are unwilling to come clean on. so i don't know why we feel compelled tox$ñf make their case when in fact -- do you dispute any of the things i said in my opening state about actions that they have taken as it relates to the u.n. monitors? as it relates to fuelling that rod? as it relates to those other elements? do you dispute any of those? just yes or no? >>w3 ranking member, no i think you're largely correct. >> so then the bottom line is

they get to cheat in a seriesko of ways -- i'll call it cheat you won't. but they get to cheat in a series of ways and we get to worry about their perceptions. tokáquote from your testimony, and i'll quote directly even if qéé- sanctions are not arguably, a technical violation of the joint plan ofñi action, we believe they would be perceivedñi ast( such by iran. now, so we're worried about their perceptions. but our perceptions of what they are doingnf/

before this committee have said looks like they need about three months. now what, mr. chairman, i don't know that members of the audience get to participate here or not, but they need about three months. now, i'm not a scientist but i'll accept their testimony as pretty much substantive as to where they need to go. any sanctions that we have imposed have taken minimum six months to give lead time to the world, and to companies that this is now a sanctionable item. so that puts us beyond the time frame, if they make a decision to move in a different direction.

and let's be honest, that at one time, maybe, but now, the iranians do not believe that there is a credible use of military force on the table should they not make a deal, and should they move to break through on nuclear capabilities for weaponization. so, you know it's -- you're telling the committee then, and you can look us straight in the eye and say that prospective sanctions that don't take place until july well after the period of time of not just a framework because i've never been able to get my hands around your march framework, what that really means, i've been told there's not even going to be a written document to that effect, a march framework takes place in july, after a deal has either been consummated or not, and would only take place if a deal has not been consummated, and even with presidential waivers at that period of time is

somehow going to make the ayatollah walk away from a deal that he thinks is in his country's or his best interest to have anyhow. that's tough to believe in. it's just -- it defies common sense. that if i want to make a deal that something you're going to do that doesn't affect my ability to make that deal is going to make me walk away from a deal that i find is in my interest anyhow. that's just not common sense. so i get -- i get that you all are hung up on the sanctions thing, and i get that there's, you know you talk about perception, that it's not necessarily a violation, but it will be perceived as such. so we're to worry about all the iranians perceptions but we can just swallow all of what they're doing independently. so let me ask you this isn't it true that even the deal that you are striving towards is not to eliminate any iranian breakout

capability, but to constrain the time in which you'll get the notice of such breakout capability. is that a fair statement, yes or no? >> yes, it is. >> okay, so we're not eliminating iran's ability to break out. we're just getting alarm bells and the question is how long are we going to get those alarm bells for? now, isn't it also true that the administration cannot lift sanctions, that it can only waive them under the present law, yes or no? >> that is correct. >> so now the iranians are going to make a deal in which this president may waive sanctions but the next president of the united states, whoever that may be, may decide you know what, this is not in our interests because it's only going to give us a limited period of time and they're going to go ahead and say sorry we're not waiving the sanctions anymore. in that the iranians are willing to make the hard decisions that they agreed to make that they have been unwilling to make for 18 months because i heard this movie's been played before. right? 20 years.

last june we heard from the president just give me time. that was seven months ago. right? now we're reliving it again. and so the bottom line is that we are going to do all of this and ultimately be in a position in which if they don't make a deal, we're exactly where we are at. but with no immediate consequences to them. their breakout time is shorter than the time it will take to create new sanctions. and now you're telling me the chairman, based upon your responses, that you don't want us to even -- the iranians have made it very clear that their parliament has to vote on this issue. why is it possible that tehran will treat its parliament better than the administration in the greatest democracy is willing to its congress? it's -- it just boggles my imagination. so mr. chairman i'll look forward to looking at your legislation, and i have suggested to you in our previous

conversations some ways in which i think it might be made even stronger. and i appreciate the -- this is one -- >> chairman can i quickly address some of the ranking member's points? ranking member i think we're most worried about not iranian perceptions, but the perceptions of our partners who are critical to enforcing the sanctions and what we've heard from them, including from prime minister cameron as recently as last week, including from our french and british colleagues, is that further sanctions now or the threat of sanctions, or even trigger legislation risks unraveling the international coalition that we've built to impose the sanctions. at the end of the day, it will be much easier if we wind up suspending sanctions in the event of an agreement of some kind to reimpose them quickly if we've kept the international coalition together. so what we're most concerned about, and focused on is that. it's not iranian perceptions. although it does matter, because, look, iran is not immune to politics, either.

they have their own. they have people who are negotiating, who are not friends of ours, who are not good guys but who may be more pragmatic because they're looking at the future of their country and trying to get out from the burdens that they're under. so we do want to do what we can to make sure that they're not penalized. but what's critical sour partners and our ability both to sustain the sanctions, and if we have to, to increase them. second i think under the japoa, this is different than the past. in the past, it's true, we've engaged with iran and talked to them without having something like the japoa that froze the program, in some respects rolled it back and created much better access to learn more about it. you're exactly right that under those circumstances the iranians would be able to talk and advance their program at the same time. that is not what is happening now. this has been a good interim deal for us in our security, as we've pursued whether we can get to a final deal. i think the framework you asked about, what we hope to get to in march, is the agreement on all

of the core elements. what commitments the iranians would make. then it will take some time to translate that in to tremendous technical detail. that's why we would need the time until june to do that. that's what we hope to be able to present to you if we get to yes at the end of march. i do believe that iran believes that there is the very credible threat of force. but what is motivating it primarily now and what brought it to the table is the tremendous economic burden it's under. thank you. >> senator menendez, i appreciate your willingness to look at some legislation that would give us an up or down vote on this issue. i would say in response to mr. blinken's comments i've talked with our international partner partners. not a single one of them has any concerns whatsoever with congress having the ability to vote up or down on a final deal. many of them believes it strengthens our hands.

with that mr. gardner, senator gardner. >> thank you mr. chairman and secretary blinken i don't want to mischaracterize anything that you've said in your response to chairman corker so i want to clarify perhaps a comment that i heard wrong. you mentioned that in the discussion the possibility of the legislation the chairman has sent over to you the possibility of that legislation undermining the credibility of our negotiators. could you expound on that comment? and is that what you, indeed, said? >> the -- in the context of these negotiations, if we get to an understanding part of this, our commitment, should the iranians make the commitments necessary to convince us and our partners that their program would be for peaceful purposes in return, their expectation is that something would be done about the sanctions. they, of course, would like us to end the sanctions immediately. that is something we will not do. and undersecretary cohen can address that. we believe that the best way to proceed is based on the not only

the commitments they make, but also the steps they take to implement those commitments that initially we suspend, not end, certain sanctions. and that over time as they demonstrate that they're making good, at that point we get to actually ending them and congress would have to do that, and play a role there. the concern that we would have is that if we're saying we're going to be suspending certain sanctions early on, and yet that is still subject to an initial vote by the congress in some fashion, they will doubt our ability to actually deliver on our commitment. that's a concern that could make the negotiations more complicated. >> and many of our partners around the world that they believe this legislation would undermine the credibility of our negotiators? >> i can't say that. i have not talked to any of our partners personally about the proposed legislation that the chairman is proposing. or -- >> it's been -- >> what i was talking about was actually sanctions legislation including trigger legislation. >> i mean it has been fairly public in terms of the news

reports about the proposed legislation. the idea is that we would put forward, no one -- this is strictly administration's position, and none of our partners. >> we would have to ask them. i don't know what their position would be on that. >> you mentioned talk about the iran not being immune to politics. and so following up on president rouhani, does he have the support within the iranian government within the politics within iran to accept an agreement from the united states international community regardless of ow flexible and the united states is and the international community with sanctions during negotiations? >> i think you asked the $64,000 question. the short answer is, we don't know. that really is the test. can iran do what is necessary to get to yes and to meet the very stringent requirements that we have, and that our partners have? that's exactly what we'rmvñìáhp &hc% testing now. i would say to you, senator, that over the course of these negotiations we have seen the gaps close. and iran after initially

absolutely rejecting certain steps that we believe are necessary, of being open to them. here's what's particularly complicated about this. this is one of those situations where nothing is agreed until everything is agreed. so we may have in the course of the negotiations an agreement in principle on one aspect. and we've talked about several of them. iraq natanz possible military dimensions of the program, et cetera. but unless and until we're able to conclude all of the elements then nothing is agreed to. so what we've seen is that on specific chapters, critical chapters they have moved closer to a point where we would find their commitments acceptable in answering our requirements. on others we're just not there yet. and it goes to your question, do they have enough political space to make the agreement? i think what we'll find that out over the next two months. >> going back to the japoa do you believe the corker legislation would fie late the intent of the japoa? >> no. >> so again, the -- it would not violate the intent of the japoa.

but would it give us the ability to weigh in, as congress, the ability to perform, advise and consent obligations under our constitution? so it's strictly the administration's concern that this would interfere with their negotiations? >> again i think some of the concerns are that and the japoa i think may be illustrative of this, if members have been asked to pronounce themselves within a month or so on the japoa, i suspect that many members initially might have given it a thumb's down because there was great skepticism about it. i think the japoa has proved itself through the results it's achieved over the course of the agreement, and i think a lot of minds were changed. for example our israeli partners who were very skeptical of the japoa initially acknowledge to us that it's been a success. so one concern is that pronouncing ourselves on the agreement before we've demonstrated whether iran's going to live up to it and meet its commitments i think may be premature. second there are some elements that, you know we can certainly

talk about. there is a -- in it a, as i read it at least, mr. chairman, a compliance requirement that is on a fairly tight hair trigger. that is, if there's a violation that is detected, then within five days sanctions would have to be reimposed. we've had situations under the japoa, where we have identified things, and actually ranking member menendez mentioned a few of them which we believe were violations of the japoa, the iranians believed they were not. there may be circumstances where it's a good-faith difference. we have a mechanism in place under the japoa to litigate those disputes and in every instance, when iran was doing something that we thought was problematic it was litigated and they ceased their activities. for example the i.r.-5. so that would be another concern. and then finally one of the concerns, mr. chairman, just to put this on the table, too while we're talking about it is as i read it it does rule out a japoa extension. and again, it is our strong intent to try and reach a basic agreement in march and then to

conclude all of the technical details by june. but i would not want to prematurely rule out in a sense arbitrarily any extensions if we're on the verge of completing the technical details in june but still have is to dot and ts to cross. we might want a little more time. i wouldn't want to rule that out. >> by all accounts iran remains a state sponsored terror one of the world's foremost violators of human rights. these discussions have been involving the regime on nuclear issues. the record as state sponsored terrorism of human rights continues to be abysmal but if the refusal to impose additional sanctions while we discuss the nuclear issues, would you support additional sanctions on -- target the regg theme areas of terrorism and human rights violations? >> undersecretary cohen can address this. i would just say very simply that we have been vigorously implementing sanctions in other areas against iran, including on the question of human rights including on the question of support for terrorism, but maybe undersecretary cohen can address

that. >> and just very briefly, senator, just three weeks ago or so, we imposed some additional sanctions with respect to iran's violation of human rights. the use of tech cog firms in iran to stifle dissent. in the period since the japoa has gone into effect among the 100 or so sanctions that we've been -- that we have imposed have been 15 focused specifically on iran's support for terrorism. >> thank you. and we would certainly love input, love engagement like you're doing with iran. we'd like the same respect. so if you have some details you'd like to talk with us about, that would be fine. senator markey? >> thank you, mr. chairman, very much. now, i've heard that the right agreement here includes a one-year breakout period of

duration of 15 to 20 years would be the agreement. now, the iraq reactor would be neutralized. and there would be a full scope safe guards under the additional protocol. those are the highlights the way i understand it. are the iranians willing to give up the heavy water reactor at alack? >> senator i think you've covered many of the key details that would be required. there's some others. the short answer is that unless iraq is neutralized so that it is not able to produce plutonium that can be reprocessed for a weapon we don't have a deal. there are different ways of doing that. one of the things that our negotiators are looking at and the folks who -- the scientists who know the technical details, are the different ways of doing that. that's part of the negotiations. but the bottom line is absent

satisfaction on iraq we will not have a deal. >> have they agreed to take iraq's heavy water processing capacity off the table? >> as of this moment, no. >> they have not. and on fordow your testimony pointed out that before the japoa, iran had about 200 kilograms of 20% enriched uranium in a form that could quickly be enriched into a weapons-grade level. and produced much of the material at the fordow facility. you say they no longer have that capacity. what do the iranians then expect to do with their civilian nuclear sites specifically the underground facility at fordow under the agreement that you're negotiating right now? without getting into the details of what we're negotiating, but again we'd be happy to discuss that in a closed setting again in the case of fordow any agreement has to eliminate its production

of 20% fissile material in a permanent fashion. so that's something that would be critical to the agreement. >> i wrote a book back in 1982 on the international atomic energy agency and i concluded at the time it was a paper tiger in terms of its ability to put in place the kinds of intrusive inspections that would ensure that there was not a breakout. and so what i'd like to do here, just to give you a chance just to talk about the inspections regime that other countries abide by and what iran is now negotiating so right now, 122 countries have agreed to allow the iaea to inspect nuclear sites any time they want, with as little as two hours' advance notice. can you tell us a little bit then about what the iaea inspectors can do in terms of visiting fordow and natanz, and other facilities if they want to

go in with no notice essentially, which is what the other 122 countries allow to happen? >> that is exactly the kind of thing, again, without getting into the specifics and the details, exactly the kind of thing we would be striving to achieve. that in fact any agreement with iran would require the kind of access monitoring and transparency that actually would put iran in a place that's exceptional. that no other country has to abide by precisely because over these many years as has been alluded to, they have forfeited the trust and confidence of the international community. so we would be looking not only at the additional protocol, but other steps which i can talk about in a different setting, that would give us, and give our partners confidence that we had all along in effect the production and supply chain, the minds, the mills, the centrifuge production facilities, and then the uranium and plutonium facilities, if any themselves that we had access. and also this would require

access to military facilities and i should add -- >> so what are they telling you about parchin? their willingness to allow for iaea inspectors to go in to that site? >> what i'd like is for your permission to leave any of the specific details of where we are in the negotiations including what they've expressed a willingness to do and not do to a classified briefing which we'll be happy to pri. >> i think it's very important for the united states to understand exactly what will be the level of intrusiveness into each one of the sites. and finally although there are so many things that we can talk about here it has been reported that saudi arabia and jordan are interested in pursuing nuclear cooperation agreements with the united states. how will we be able to convince those countries to agree not to demand the right to enrich

uranium as part of those agreements if we allow iran to continue to maintain its enrichment capability as part of a final agreement? and i put that in the context of the 123 agreement and the chairman already referred to this, the 123 agreement with the united arab emirates, which again i thought was a mistake. as i think a mistake would be made if we had an agreement with saudi arabia, for example. just will trigger a pro-live indication cascading effect if there is not a sense that there is equal treatment. could you talk about that a little bit? i think it's very important for us to go to the next step in terms of what is the reaction of saudi arabia, if iran has this capability. >> first of all senator let me note your own leadership on these issues and the work you've done over the years on this. we have a very clear policy of trying to prevent the spread of enrichment and reprocessing second nothing. we're working to discourage proliferation technology beyond countries that already possess it. i think any resolution we reach

with iran will be exactly the opposite of a model for any other country. i don't think any country would want to follow the path that iran has followed to get to where it is. which is involved a decade or more of increasingly onerous sanctions, isolation, and an economy in tatters. that doesn't make any sense. so i think iran is actually the countermodel, and it sends a very strong signal to the rest of the word, that this is not the path to pursue. if you want to have a peaceful nuclear program, and get the most advanced technology which we could provide under a 123 agreement for example. so i think it's actually very powerful in the other direction. >> we can pursue this further, but again, i think a no enrichment policy is the correct policy. especially as it sets a precedent for saudi arabia united arab emirates, and others, and especially since the iranians are clearly intending on building 8 to 10 nuclear power plants as they are flaring ten nuclear power plants worth of nuclear electricity

generating capacity on a daily basis. okay so we just have to understand fully what the long-term emily indications are. thank you mr. chairman. >> senator grasso. >> thank you mr. chairman. secretary cohen, in a meeting in the white house last week the president said he thought the chances of a deal were about -- were less than 50% and i think you said exactly the same thing today. when you look at odds like that i think it's important for us to take in to consideration the pie possibility that this does not succeed, and what we need to do in case of an arrangement -- agreement isn't received isn't able to come out. you had said that the if there is not a deal that the congress and this administration would move quickly to enact new sanctions if iran were to walk away from the talks. so could you talk about some specific additional sanctions that you think the administration would at least support imposing on iran if the diplomatic talks fall apart, and nothing is achieved? >> senator we have as you

know, over the course of the last several years, focused in a number of important areas on iran's ability to sell its oil, on its access to international financial system on its ability to trade, and on investments in iran's various -- i think all of those issues would be ones that we would explore and likely focus on in additional sanctions. i'm not prepared to tell you specifically today what the detailed sanctions would be. but we -- but i think those broad areas which have been i think, quite effective, would be areas where we'd be -- >> you make the point where you say those are things we'd be interested in exploring. and so then the question naturally leads to how long would it actually take until sanctions were imposed that would actually have a meaningful impact on what's happening? >> i think that's an important question. i know that their ranking member menendez commented earlier about the phase-in time for certain sanctions. and for some legislation in the

past we have had relatively delayed phase-ins. particularly as we start to do some brand-new things. in other areas the phase-in time has been quite short. to cite just one example with the ndaa of 2012 there was a requirement that we block all iranian financial institutions. so impose sanctions on iranian financial institutions. that was implemented in a matter of weeks after that legislation was enacted. so there is -- there are precedents where new sanctions, new legislative sanctions can go into effect very quickly. executive sanctions, when we act by executive order, they're immediately effective, and so they go into effect the day that they are announced.lpcjrñ and just one final point even with sanctions that have some delayed phase-in, business and industry adjust before the effective date of the sanctions. so if it's a two-month phase-in

you see financial institutions, you see businesses immediately beginning to scale back their activity so that they're not caught up short when the sanctions go into effect. so we can impose sanctions very very quickly. if need be. >> and since the combined impact of sanctions, not just by the united states, but by others has its initial impact on the ground, have there been these discussions with p5 plus 1 about imposing sanctions across the board that would snap back into place? >> we have an ongoing pangs with p5 plus 1 partners and others around the world about sanctions and about what the future may hold. so i don't want to get into any of the details of those conversations, but absolutely. >> a number of us have just come back from saudi arabia, from qatar, from israel, have visited members of the free syrian army and this has to do with what happens when sanction relief occurs and where the money is spent that goes to iran, what we have heard from the commanders on the ground of the free syrian

army is when sanctions were relieved in the past money went into iran which then immediately went to help finance efforts with assad. in syria, that assad at this spoint buying at this point is buying oil and food staples from isis so an indirect funding through assad to isis. so i'm wondering how you see what happens on the ground at least what we heard visiting with the free syrian army. sglif heard similar reports. it's terribly concerning. no question about it. i will say that our sense of what iran has been doing with the funds to which it has been given access that were otherwise frozen is primarily to use those to try to prop up its economy which is as deputy secretary tatters. but we have been very much focused on iran's support for

terrorist organizations for the syrian regime throughout this process. and we'll continue to take action where we see an ability to do so. >> obviously hamas hezbollah. mr. blinken if i can visit with you about proliferation. the other thing we heard, and i think senator markey talked about, if iran is able to proliferate, who can do and what interests are going to be. we heard saudi arabia is interested in pursuing a development program or purchasing nuclear weapons from pakistan. there is that concern that this could result in actually instead of eliminating nuclear arms resulting in an arm's race in the middle east. can you comment on that? >> yes, senator, thank you. what's most likely to lead to a nuclear arms race is iran getsing a nuclear weapon. that would open the flood gates and we would go down a path that no one wants to go down.

as i suggested earlier, it's our judgment that what iran has done is hardly going to be a model for any other country. i don't think any other country would want to subject itself to the burdens that have been imposed by the international community over the last decade or more for its efforts to pursue a nuclear weapon. the isolation, the sanctions, the state of this economy, the message that that sends to everyone else is this is not what you want to do. what you want to do is to respect international norms and indeed we're prepared to work with countries that do that. also to provide for them for peaceful purposes the most advanced technology for their nuclear power programs, but not enrichment and reprocessing capabilities. so i think the message it sends is one of following international norms not violating. >>. as as a final thought, i agree if iran has a nuclear weapon that

will happen. the question is if they are allowed to enrich at a level that far exceeds what they really need for energy use. there's a mathematical calculation for what they need plus the potential of how much they want to enrich and the concern that even the approval of that could result in this additional proliferation and arms race. >> our entire focus is on ensuring that as a practical matter they are not able to produce enough material nor a bomb in less than one year. that would give us plenty of time to take action with the international community or alone if necessary to counter that effort. i should say we're being very conservative about this at least in my judgment. as you know, it's not just the material. it's having a weapon, it's the assessment of our intelligence community that they were pursuing a weaponization program, at least until 2003.

the evidence suggests they stopped them but this is something we remain individual lent about. it's also the capacity to being able to make that together. but what is most visible what is most easiest to see, account for, measure is the material. and that's why in this agreement what we're focused on is making sure that the constraints are so severe and the access so exceptional that we would be able to see if they tried to break out and would have plenty of time to do something about it. >> thank you, mr. chairman i understand that senator purdue has preferred to senator johnson for time reasons. i would say to the audience we appreciate you being here and listening. we don't appreciate being involved in the dialogue so if you could keep comments to yourself. senator murphy. >> thank you very much senator

corker congratulations on. i wanted to accept your invitation and focus some of my questions on the jurisdiction of this committee and maybe sneak in a last question on sanctions. mr. chairman, as you know, i have been one of the strongest proponents of congress exercising its constitutional authority and responsibility when it comes to being coequal with executive branch with respect to the management of foreign affairs. that's why i think it's absolutely essential requirement that this committee continue our work on the constitution spells out very clearly that it's our responsibility to declare war and we need to weigh in on what is happening today in syria and iraq. the constitution is also equally clear as to when the congress has the responsibility to weigh in on international agreements

entered into on behalf of the united states by the executive. there's a long standing precedent on what constitutes a treaty requiring the u.s. congress to weigh in and what constitutes a nontreaty obligation entered into by the executive. it's important to understand the difference between the two. i accept the caution that secretary blinken made to us about a new precedent that we might be setting about weighing in on this agreement and what it would mean for future agreements. i also work about our ability in the current political context to have a reasonable, productive debate on international agreement of this import. the fact is that we can't even approve treaty recognizing disability rights. we have an agreement on illegal arms trafficking that was opposed only by iran, north korea and syria at its inception

and we can't even begin a discussion about that treaty here. so i worry about our ability to process this. but i do understand the concerns that the chairman is raising. so i want o to maybe direct a few questions to our witnesses about the concerns. the first is that a suspension of sanctions is part of an agreement with the iranians. has the effect of being a permanent sanctions thus essentially eliminating our ability to weigh in with a statutory removal of the sanctions. so i guess i will ask secretary cohen this question. do you believe if an agreement was reached that led to a suspension of the sanctions that that would be an effective unraveling of the sanctions?

or do you believe that it if the iranians didn't live up to that agreement, we would have the ability to put back in place sanctions that were suspended. it's a legitimate concern that senator corker is raising and would be good to hear your thoughts. >> absolutely, and it is a legitimate concern and one that is foremost in the minds as this agreement is being negotiated, which is that whatever relief there would be from sanctions from our own sanctions as well as from the sanctions that have been imposed through the u.n. security council would be in relation to steps taken by iran. so as secretary blinken noted earlier, the idea here is for phased sanctions relief, phased and tied to specific milestones that the iranians would have to meet. that is in part designed to

ensure that if the iranians don't meet those milestones, we can reimpose the sanctions quickly because they will have been suspended, not terminated. it's important that our international partners as part of that agreement are buying into that same phased approach so that if iran doesn't meet its milestones, doesn't fulfill its commitments, not only will our sanctions go back into effect others will as well and they are all committed to reimposing the sanctions. so i think it is a legitimate concern, but one we're trying to address by the way the agreement is being constructed. >> it was a legitimate concern raised about the jpoa that did not end upcoming true. people said this would be unraveling of the sanctions and even our loudest critics now accept that those sanctions can be reinstituted because they have held together. secretary blinken just talk about what happens within the p

5 plus 1. if we reach an agreement that our partners are enthusiastic about, they are able to get domestic support for and congress disapproves it, what happens in that situation? our partners have consented to and the administration has consented to but congress rejects? >> you're putting the spotlight on a fundamental point that's important to keep in mind as a general proposition, which is we're nots the only ones who have a vote in this. it's our partners who are critical to a sustaining and if it comes to that actually increasing sanctions. so we'ringorking to keep them on board has been a critical effort by the president repeatedly over these years. there are several partners, for example, for whom implementing these sanctions is a real