The Key to Countering Iran

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Political and economic pressure from the United States will unite Iran's fractious political
system behind the Islamic Revolutionary Guard Corps (IRGC), which lies at the heart of
Tehran's regional strategy.
Washington's recent addition of the IRGC to the Treasury Department's list of terrorist groups
probably won't have a substantial impact on the organization's ability to fund itself and allied
militant groups across the Middle East.
 In response to the U.S. decision, Iran will boost its military and political support for the IRGC by
expanding its budget for asymmetric operations, including the activities of the elite Quds Force
and ballistic missile development.

In a diplomatic dispute that seems to be growing more heated by the day, the United States has
taken another swipe at Iran. On Oct. 13, U.S. President Donald Trump announced his decision
to forgo the certification of Iran's nuclear deal with the West, just two days before the deadline,
and to slap a new round of sanctions on a portion of the government in Tehran. As mandated by
the Countering America's Adversaries Through Sanctions Act of 2017, Trump also labeled the
Islamic Revolutionary Guard Corps (IRGC) one of Iran's most powerful military branches
a terrorist group. He stopped short, however, of listing the corps as a foreign terrorist
organization, an option the White House was rumored to have considered earlier this year.

Though largely symbolic, the new label will draw considerable ire in Iran. Blowback could come
from any number of the IRGC's units the aerospace, naval and overseas operations divisions,
to name a few that the designation targets. And much to the United States' dismay, the move
will likely backfire by uniting Iran's divided political factions behind the group now in its
crosshairs.

The Cornerstone of Iran's Strategy

The White House has set its sights on the IRGC because of how indispensable the group has
become to Iran's modern strategy in the Middle East. Under the monarchy that ruled Iran in the
1970s, the country boasted one of the strongest militaries in the region, equipped with advanced
hardware it had purchased from its erstwhile ally, the United States. After the Islamic Revolution
of 1979, however, then-Supreme Leader Ayatollah Ruholla Khomeini deeply distrusted the
country's regular army because of its close relationship with the shah he had helped to depose.
Eager to form a force loyal only to him, Khomeini established the IRGC, and the once-
formidable army began to languish amid a lack of funding. Today its conventional weapons and
tactics are weakrelative to those of its Turkish and Saudi counterparts.
Quds Force commander Gen. Qassem Suleimani attends a celebration marking the 37th
anniversary of the Islamic Revolution on Feb. 11, 2016 in Tehran.

(STR/AFP/Getty Images)

Instead, Iran has built its security strategy around the asymmetric capabilities of the dominant
IRGC, in part to avoid the type of overt conflict that would expose the country's vulnerabilities in
conventional warfare. A critical component of this approach is Iran's support for militant groups
across the region, including Hamas, Hezbollah, the Palestinian Islamic Jihad and Kataib
Hezbollah all of which the U.S. State Department has declared to be foreign terrorist
organizations. The IRGC (and, in particular, its Quds Force unit) is the primary caretaker of
these relationships, providing support and funding to proxies in exchange for action against
Tehran's rivals. Hamas and Hezbollah, for instance, are useful means of squeezing Israel from its
southern and northern borders, respectively. In much the same way, Iran can lean on Yemen's
Houthis and Bahrain's Al Ashtar Brigade to put pressure on Saudi Arabia. But perhaps most
concerning to the United States is Iran's partnership with Iraq's Shiite militias, some of which
Washington is currently working with. The United States fears that with nudging from Iran, these
groups could start to target U.S. military personnel in Iraq.

Other core parts of Iran's asymmetric strategy are the ballistic missile and space programs that
the IRGC's aerospace force leads. Though Iran probably won't be able to deliver a warhead to the
United States in the near future, it can use ballistic missiles much like its proxies to strike
at or deter attacks from nearby rivals with better-equipped conventional forces. The IRGC's navy
is also designed to conduct rapid attacks, missile attacks and mining operations in the Persian
Gulf, which could easily disrupt global shipping in the Strait of Hormuz and take a heavy
economic, physical and psychological toll on Tehran's enemies.

Cyberspace has proved to be a theater in which Iran can thrive as well. The country is believed to
have been behind the Shamoon cyberattacks that swept across the Arab Gulf states in 2012
before resurfacing in a modified form last year. Though the IRGC doesn't formally own Iran's
cyberwarfare program, it controls many of the program's leadership functions. And in July, the
IRGC arrested 23 officers for revealing evidence that the unit was responsible for several
cyberattacks that hit Turkey in 2014-15.

Clearly, the IRGC has a hand in many of Iran's covert activities throughout the Middle East, and
the United States is determined to curb them all. By default, then, any comprehensive U.S. policy
for countering Iran must restrict the movements of the IRGC in some form or fashion.
Supporters of Lebanon's Shiite Hezbollah militant group wave flags bearing portraits of former
Supreme Leader Ayatollah Ruholla Khomeini (L) in the southern Lebanese city of Nabatieh on
Oct. 4, 2017.

(MAHMOUD ZAYYAT/AFP/Getty Images)

What's in a Name?

But assigning the label of "terrorist organization" is no trivial matter. According to U.S. law,
there are two ways in which Washington can designate groups as terrorist organizations, each
with its own implications.

The first is using the Immigration and Nationality Act of 1965 to label a group a "foreign
terrorist organization." It can be difficult to pursue since the term is narrowly defined as an entity
that engages in terrorism or terrorist activities, or has the capability and intent to do so. The act is
thus designed to target the culprits who are actually pursuing terrorist activities, rather than the
individuals, companies or state actors providing them with material support. Because overseas
proxy groups, rather than Iranian organizations such as the IRGC, carry out operations against
Iran's rivals at its behest, the United States cannot easily dub the country's military branch a
foreign terrorist organization.

The second option is to designate entities as "terrorist groups" (or individuals as "supporters of
terrorism") under Executive Order 13224, as Trump declared on Oct. 13 that he intended to do.
Signed by former U.S. President George W. Bush in the wake of 9/11, the order is meant to
broaden the legal basis for the pursuit of terrorist support networks. Not only are the groups in
the first category routinely considered to be terrorist organizations under this ruling as well, but
so are their financial backers. Iran has held a spot on this list since 1984 as a state sponsor of
terrorism, and the executive order will continue to be the United States' most logical legal
mechanism for targeting Iranian citizens and groups.

From a practical standpoint, joining the ranks of Executive Order 13224's designees will do little
to hamper the IRGC's activities. Because the United States has leveled punitive measures related
to terrorism, human rights abuses and ballistic missile development against several of the group's
members, associates and wings, the IRGC is already one of the most heavily sanctioned
organizations in the world. Moreover, the unit's Quds Force has been on the executive order's
"Specially Designated Nationals" list since 2007, which has frozen its U.S. assets and barred
U.S. citizens and companies from interacting with it.

Ironically, a designation under the executive order deals a heavier financial blow than that of the
foreign terrorist organization. But the latter label carries one critical advantage: criminal charges.
Anyone, including non-U.S. citizens, who provides lodging, financial services or other aid to a
foreign terrorist organization faces the possibility of prosecution in the United States. It's easy to
imagine the economic and diplomatic problems that might arise if Washington were to add the
IRGC to its list of foreign terrorist organizations. The employees of international firms doing
business in Iran would have to tread carefully to avoid the threat of jail time, as would
government officials receiving Iranian delegations traveling abroad, which often include
members of the IRGC. Moreover, the United States has never designated a military unit of a
sovereign state a foreign terrorist organization; should it break that pattern, other countries may
follow its lead, perhaps even eventually treating prisoners of war as terrorists. Aware of these
potential complications, the U.S. Defense Department and State Department have pressured the
Trump administration not to rely on the Immigration and Nationality Act of 1965 to target the
IRGC.

Of course, punishing the IRGC under the auspices of the executive order could have some
influence over the group's capabilities. After all, the organization boasts an array of enterprises
and shell companies that span the Iranian economy, and foreign firms will have to give extra due
diligence to their operations in the country to ensure that they don't run afoul of Western
sanctions. Nevertheless, Iran's foreign investment won't dry up, even if the IRGC becomes a less
attractive partner for many international companies.

The Iranian government, moreover, will replace any revenue streams that the IRGC loses access
to. In fact, the group's funding may even increase, thanks to its central role in the nation's
security strategy and to the empowerment of Iran's hard-liners, who will oppose any attempt by
President Hassan Rouhani to erode the IRGC's political and economic clout.

United Against the United States

Rouhani is not the IRGC's only domestic opponent, however. The group's pervasive power is a
divisive issue in Iranian society, and the president has found the popular support needed to block
some of its funds. That said, the IRGC's importance to the country's security hasn't generated the
same amount of controversy. And as the United States has stepped up pressure on the IRGC over
the past week, a rare display of unity has emerged between moderates like Rouhani and the
conservative military group. That show of support will likely yield a boost in the IRGC's budget
in the weeks ahead, just as Iranian lawmakers funneled $300 million to the Quds Force and the
IRGC's ballistic missile program after the United States began ratcheting up tension earlier this
year.

Still, it remains to be seen whether the IRGC's hard-line allies will be able take advantage of the
political climate to boost their standing at home. In the last three elections, the country's hard-
liners made a poor showing, and they remain in disarray today as they struggle to connect with
the majority of Iranian youths. Perhaps it's no surprise that the camp has begun to pursue
publicity stunts that were previously unheard of among conservatives, such as meetings with
rappers and social media campaigns. The United States' renewed pressure against Iran may be
the fuel they need to drive a rebranding of their image among voters. If so, Iran's hard-liners
could make a comeback that enables them to block Rouhani's attempts to crack down on the
IRGC's influence in Iranian politics. And if the United States is not careful, its effort to isolate
the powerful military branch will only succeed in banding Iran's political factions together
against it.