The Future of the Dollar
U.S. Financial Power Depends on Washington, Not Beijing
Tensions between the United States and Iran have spiked once again. Last week, responding to planned U.S. sanctions against Iran's central bank, Tehran threatened to close the Strait of Hormuz, the shipping gateway for one-fifth of the world's oil. U.S. President Barack Obama, pressed by Congress' near-universal support for tough new measures to force Iran to abandon its nuclear ambitions, decided to go ahead with the sanctions and signed them into law on Saturday. Fully enforced, they would slash one of Iran's foremost state revenue streams and virtually excise one of the world's leading oil exporters from the marketplace.
The chain of events fueled concerns that Washington might be stumbling into a third war in the Middle East. But a more fundamental problem underlies these developments. The Obama administration's new sanctions signal the demise of the paradigm that had guided U.S. Iran policymaking since the 1979 revolution: the