Iranian President Mahmoud Ahmadinejad speaks at a ceremony in Iran's...

Iranian President Mahmoud Ahmadinejad speaks at a ceremony in Iran's nuclear enrichment facility in Natanz, 300 kms 186 (miles) south of capital Tehran, Iran. Credit: AP, 2007

First, the good news: Sanctions have helped drive Iran's currency to its lowest level ever, half its value from a year ago. Meanwhile, Iran's oil exports were down almost 45 percent in July, the most recent month for which data are available.

The bad news: Iran's rulers are as determined as ever to develop nuclear weapons that they intend to use to dominate the Middle East, weaken America -- "Satan incarnate" -- and wipe Israel off the map. "New and significant intelligence" received by the International Atomic Energy Agency suggests Iran is closer than ever to acquiring the ability to build nuclear weapons.

Few sanctions advocates expected that Iran's rulers -- men possessed of a radical ideology and grand ambitions -- would easily or quickly be convinced that acquiring nukes is more trouble than it's worth. There was a chance: In 1988, then-Iranian Supreme Leader Ayatollah Ruhollah Khomeini reluctantly agreed to a ceasefire with Iraq due, it is widely believed, to the economic crisis brought on by the conflict and the peril that posed to the survival of his Islamic Revolution.

There are no indications that sanctions at present levels have brought Iran's current rulers anywhere near that point. What sanctions have done is end business as usual with the world's most threatening regime, and link Iran's crimes to more than just rhetorical consequences. By no other means was Iran going to be singled out or isolated -- certainly not by the United Nations or other organs of the so-called international community.

Sanctions have been controversial and have illuminated Iran's ideology, policies and actions at a time when most journalists reporting from Iran are either credulous or sympathetic to the regime. (To be anything else is hazardous to your health.) Over time, reality has been sinking in. Despite a vigorous propaganda effort by Iran's apologists, 80 percent of Americans believe the regime's nuclear program menaces the U.S. and its NATO allies, according to a poll taken this summer.

Last week, Canada closed its embassy in Iran, gave Iranian diplomats in Canada five days to pack up and leave, and formally designated Iran a "state sponsor of terrorism." The Iranian response was typical: A government spokesman called the Canadian government "racist." In an editorial last week, the Washington Post, hardly a conservative or hawkish newspaper, said that "if Mr. Obama really is determined to take military action if Iran takes decisive steps toward producing a bomb, such as enriching uranium to bomb-grade levels or expelling inspectors, he would be wise to say so publicly. Doing so would improve relations with (Israeli Prime Minister Benjamin) Netanyahu and deter unilateral Israeli action -- and it might well convince Iran that the time has come to compromise." Exactly: The soft talk of diplomacy and relatively small stick of sanctions need to be buttressed by a big stick -- a credible warning that force will be used should peaceful options prove insufficient.

The sanctions now in place are tough -- but nowhere near as tough as they could be. To increase economic pressure the U.S. would, at a minimum, blacklist both the Central Bank of Iran and Iran's energy sector. Beyond that, the U.S. could declare Iran's entire economy a "zone of primary proliferation concern." European and other foreign companies would be asked to halt any and all dealings with Iran except for providing food and medicine.

Some will say these actions are tantamount to economic warfare. They are not wrong. But Iran's rulers have been at war with America for more than 30 years. The question now: What will we do to prevent them from acquiring nuclear weapons with which to wage it?

And should Israel decide that the imminent acquisition of nukes by a regime openly committed to its annihilation requires a military response sooner rather than later, having tougher sanctions in place will be indispensable. The day after such a clash, Western diplomats should be able to tell the theocrats that the resuscitation of Iran's economy cannot begin until they we are certain that their nuclear weapons program is moribund, and that they have stopped sponsoring terrorists abroad and violating fundamental human rights at home.

At that point, the Iranian people are sure to have opinions of their own. With a little encouragement, they may have the courage to express them.

Clifford D. May is president of the Foundation for the Defense of Democracies, a policy institute focusing on national security. Email cliff(at)defenddemocracy.org.

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