Behind Recent Billions Given to Iran Is a Decade of Failed US Policy

Obama’s Iran actions loom large over the current administration and the Israel war.
Behind Recent Billions Given to Iran Is a Decade of Failed US Policy
Motorcyclists pass an Iranian medium range air defense missile system displayed on a main road as part of a street exhibition in Tehran, Iran, on Sept. 27, 2023. (Atta Kenare/AFP via Getty Images)
Jeff Carlson

The Biden administration in recent weeks has received a barrage of criticism for issuing waivers that allow Iran to receive $6 billion in frozen funds that had been held by South Korean banks.

But the $6 billion to Iran is only one piece in a larger story. In order to fully understand the implications of the Biden administration’s appeasement of Iran, one must go further back in time—to the Obama administration’s Iran nuclear deal. It’s from this vantage point that it becomes apparent that President Joe Biden’s more recent actions are really a continuation of the disastrous Iran policy under President Barack Obama.

In the most recent deal, the Biden administration and Iran agreed to a prisoner swap—trading Iranian nationals convicted of illegally exporting controlled technology to Iran for five U.S. citizens who were wrongfully imprisoned by the Iranian regime. This wasn’t the first time a prisoner exchange took place between Iran and the United States.

The pivotal part of President Biden’s Iran deal provided for U.S. waivers to South Korea, enabling the transfer of $6 billion in funds that had been frozen by the United States during the Trump administration. Directly or indirectly, this money was used by Hamas in its horrific attacks on Israel.

The funds, which originated from oil purchases, have been transferred to an account overseen by Qatar. The State Department in recent days has gone to great lengths to assure the public that there will be significant restrictions on the use of funds—which ostensibly will be limited to food, medicine, and medical equipment.

We also were assured that Washington would have “full visibility” over Tehran’s use of the funds. This is, of course, a laughable position to take for a variety of reasons. Qatar isn’t only a longtime promoter of radical Islamic groups; it’s also the long-standing home to the political leadership of Hamas. Qatar serves as the primary financial hub for most Islamic terrorist networks, and it is sympathetic to and supportive of Iran.

The Biden administration’s choice of Qatar as the supposed “overseer of the funds’' is extremely telling. If they wanted to, Qatar could simply keep the escrowed funds and pay Iran out of another account.

But there’s another, more direct, issue.

Cash, unlike specific goods, is fungible. Even if Iran were to use the $6 billion as designated, these new funds from the Biden administration free up other funds that would have been spent on the same items.

The reality is that President Biden’s plan effectively increased Iran’s budget by $6 billion—a huge amount relative to the size of its economy—that had been allocated elsewhere within its budget and was freed up for the regime’s ongoing funding of terrorist activities.
An Iranian surface-to-surface missile displayed next to a portrait of Iran's supreme leader, Ayatollah Ali Khamenei, in Tehran, Iran, on Sept. 27, 2023. (Atta Kenare/AFP via Getty Images)
An Iranian surface-to-surface missile displayed next to a portrait of Iran's supreme leader, Ayatollah Ali Khamenei, in Tehran, Iran, on Sept. 27, 2023. (Atta Kenare/AFP via Getty Images)
Iran, meanwhile, has made no secret of its intent. Iranian President Ebrahim Raisi has already said that his government will decide how it will spend the $6 billion in previously frozen funds, telling NBC News’ Lester Holt that the money will be spent “wherever” Iran needs it.

Excuses aside, the Biden administration knew full well that any funds transferred to Iran would be used in their ongoing sponsorship of terrorism.

As recently as Aug. 25, the deputy head of Hamas’s political bureau told Lebanon’s pro-Hezbollah Al Mayadeen satellite television network during an interview: “We are preparing for an all-out war, and we are closely discussing the prospects of this war with all relevant parties.

“The all-out war will be a defeat for Israel, and we see that classical wars have changed, and this is evidenced by the conflict in Ukraine.”

Making matters even worse, in the initial aftermath of the horrific attacks on Israel, Secretary of State Antony Blinken effectively acknowledged on NBC News’ “Meet the Press” that administration officials knew in advance what Iran would do with the newly released funds.

“Iran has unfortunately always used and focused its funds on supporting terrorism,” he said.

But the situation is actually far worse than it appears on the surface.

The United States also facilitated another, earlier waiver, this time involving Iraq, that effectively freed up $10 billion, in addition to the more recent $6 billion.

Iraq announced in July that it would repay billions of dollars in natural gas debts owed to Iran using Iraqi oil instead of cash—a move that was a violation of U.S. sanctions absent authorization and waivers from Washington.
That transaction didn’t happen in a vacuum. It followed weeks of reporting related to a U.S. offer to free up cash for Iran so long as Tehran agreed that it wouldn’t produce weapons-grade uranium.

There’s also another, less-reported path that has allowed Iran to bring in huge amounts of cash: the export of oil to China.

President Barack Obama and Secretary of State John Kerry (R) meet with a small group of veterans and Gold Star Mothers to discuss the Iran nuclear deal in the Roosevelt Room of the White House on Sept. 10, 2015. (Olivier Douliery-Pool/Getty Images)
President Barack Obama and Secretary of State John Kerry (R) meet with a small group of veterans and Gold Star Mothers to discuss the Iran nuclear deal in the Roosevelt Room of the White House on Sept. 10, 2015. (Olivier Douliery-Pool/Getty Images)
Despite ongoing sanctions, China has been a huge buyer of oil from Iran—with the Biden administration willfully looking the other way. In total, Iran has been exporting as much as 2 million barrels per day—all allowed by the U.S. government.

This intentional funding of Iran makes sense only when it’s viewed as a continuation of President Obama’s approach to Iran.

It’s an approach that was highlighted during the concessions President Obama made throughout the Iranian nuclear deal saga; the deal was so favorable to Iran that its former president claimed that “the most important job of our foreign minister is first to stand behind the Joint Comprehensive Plan of Action,” or JCPOA, as the arrangement was formally known.

When President Obama decided to assume personal leadership of the Iran nuclear negotiations, the Iranian economy was straining under a decades-old series of economic sanctions. However, rather than support congressional wishes to further tighten sanctions—thereby maintaining pressure on the ruling mullahs—he chose to loosen economic restrictions as a prelude to his negotiations.

The Iranian economy began growing again in 2014—and so did Iran’s negotiating power. President Obama signed a deal with Iran that allowed the Iranians to hide much of their nuclear activities, lacked any real semblance of enforcement or penalty, ended all economic sanctions, ended embargoes on ballistic missiles, and began to expire in 10 years.

President Obama himself conceded that Iran would have full nuclear capability almost immediately after the deal expired. Amid these major concessions, the United States inexplicably gave the Iranians access to more than $120 billion in funds held abroad and planes loaded with pallets of cash.
And just like President Biden, President Obama agreed to the release of seven Iranian men as part of the deal. At the time of the deal, he characterized them as “civilians, businessmen, awaiting trial for mere sanctions-related offenses and violations of the trade embargo.” In reality, these men stood accused by the Department of Justice of being national security threats.

Effect of Sanctions

Before President Obama’s negotiations with Iran, the country was buckling under the pressure of sanctions from international sanctions. Iran’s gross domestic product (GDP) shrank by 9 percent between March 2012 and March 2014 and was later estimated to be 15 to 20 percent smaller than it would have been without the sanctions.
The U.S. Treasury stated that sanctions cost Iran $160 billion between 2012 and 2015. More than $120 billion of Iranian reserves held in banks abroad were inaccessible. As a result, Iran’s currency, the rial, utterly collapsed. In the first 10 months of 2012, the Iranian currency lost more than 80 percent of its exchange value; in a single day, on Oct. 1, 2012, it tumbled 15 percent.
The collapse of the rial caused inflation to spike to 27.4 percent in 2012, from an already uncomfortable 20.6 percent in 2011, before peaking at 39.3 percent in 2013.

Iran was under enormous economic pressure.

A Khorramshahr-4 missile is launched at an undisclosed location in Iran, in a photo released on May 25, 2023. (Iranian Defense Ministry via AP)
A Khorramshahr-4 missile is launched at an undisclosed location in Iran, in a photo released on May 25, 2023. (Iranian Defense Ministry via AP)
But things began to change for Iran when Hassan Rouhani, a former nuclear negotiator, was elected as president of Iran in 2013. Three days after his inauguration, Mr. Rouhani called for the resumption of negotiations with China, France, Germany, Russia, the United Kingdom, and the United States on Iran’s nuclear program.

Obama’s Deal

On Sept. 27, 2013, President Obama personally called Mr. Rouhani, marking the highest-level contact between the United States and Iran since 1979. Talks began in October 2013 in Geneva.
While Congress had been pushing for further tightening of sanctions in front of negotiations, on Nov. 23, 2013, President Obama announced the first round of sanctions relief for Iran.
That relief was significant and included $3 billion in cash, plus another $16 billion to $17 billion in gold, and petrochemical and automotive sanctions relief—a $20 billion package that boosted Iran’s total foreign exchange reserves by a staggering 25 percent.
The announcement by President Obama translated to a flood of trade delegations that visited Iran–including 10 groups in the first two weeks of January 2014. Iran’s economy began to recover almost immediately. Iran’s GDP grew by 3 percent in 2014, as inflation eased to 17 percent from 39 percent.

As the Iranian economy began to grow, so did Iran’s negotiating power.

On July 14, 2015, the United States, along with Russia, China, the UK, France, and Germany, reached the nuclear agreement with Iran. The JCPOA lifted all economic sanctions and allowed Iran to access $120 billion in reserves held in banks abroad.

The JCPOA also contained a fatal flaw: sunset clauses. Those measures allowed for critical nuclear, arms, and ballistic missile restrictions to disappear over a five- to 15-year period.

All Tehran had to do was simply abide by the agreement to emerge as a threshold nuclear power with an industrial-size enrichment program.

That same agreement would also allow Iran to begin spreading weapons throughout the Middle East. Because of the sunset clauses inserted by President Obama, the international arms embargo imposed on Iran expired on Oct. 18, 2020.
As a result, the supply, sale, or transfer of “any battle tanks, armored combat vehicles, large caliber artillery systems, combat aircraft, attack helicopters, warships, missiles, or missile systems to Iran would no longer require U.N. Security Council approval.” U.N. member states also would no longer be obligated to prevent the supply, sale, or transfer of arms or related material from Iran.
“The expiration of this arms embargo would have immediate destabilizing consequences for Yemen, Bahrain, Lebanon, Syria, Iraq, and Israel,” a 2019 report predicted. “Terror organizations like the Islamic Revolutionary Guard, Hezbollah, and Hamas would become the likely beneficiaries of this sunset provision.”

We now know with certainty that this prediction was entirely valid.

There also was another problem with the agreement.

The JCPOA’s key requirements stated that for eight years, ballistic missile restrictions would remain in place. This assertion was repeatedly put forth by the Obama administration. But President Obama had quietly made several notable changes to the language on ballistic missiles.
Buried deep within the JCPOA, on page 99 in Annex B, item 3, resides this actual language:

“Iran is called upon not to undertake any activity related to ballistic missiles designed to be capable of delivering nuclear weapons, including launches using such ballistic missile technology.”

The phrases “called upon” and “designed to be capable” are incredibly crucial changes to the original language contained within the earlier U.N. resolution, which stated that “Iran shall not undertake any activity related to ballistic missiles capable of delivering nuclear weapons, including launches using ballistic missile technology.”

Those changes weren’t made by accident.

Iran began building missile complexes in Syria and Lebanon. On Aug. 15, 2017, Iran’s construction of a missile production facility in Syria near the coastal city of Baniyas, north of Tartus, was reported by The Times of Israel.
Then, on Aug. 22, 2017, Iran’s atomic chief shocked the international community by stating that Iran needed only five days to ramp its uranium enrichment back up to 20 percent—the level at which the uranium could quickly be further enriched for use in a nuclear weapon. President Obama’s Iranian nuclear deal wasn’t only toothless; it also effectively solved all of Iran’s problems.

Iran, by its own admission, managed to retain full capability to resume 20 percent uranium enrichment almost instantaneously. The JCPOA preserved Iran’s nuclear capability. It wasn’t materially reversed, merely suspended. International pressure abated. The Iranian economy immediately rebounded with the lifting of sanctions, and foreign investment flooded back in.

The JCPOA materially also loosened restrictions on Iran’s ballistic missile advancement, and as a result, Iran’s ballistic missile program is far more advanced today. And, finally, Iran was allowed to access more than $120 billion in cash.

At the time of JCPOA, The New York Times summed up the situation perfectly:

The Obama administration “described an Iranian capability that had been neutralized; the Iranians described a nuclear capability that had been preserved.” Iran negotiated with a willing counterpart in the Obama administration and emerged with its nuclear program slowed but essentially intact.

In return, Iran was given access to a huge pool of overseas cash and a flood of foreign investment. Iran could rebuild its economy and resume its nuclear program. It could also begin to spread armaments and terror throughout the Middle East.

The horror we witnessed in Israel and the resulting spread of war falls not only at the feet of President Biden, but also with the originator of all of this: President Obama.

Views expressed in this article are opinions of the author and do not necessarily reflect the views of The Epoch Times.