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Iran vs. US: Heated exchange between us and them; Iran's economy tanking

 Well, at least the Iranian envoy didn't take his shoe off and bang it on the table, but things got a little hot yesterday between us and them, according to Allah over at Hot Air. ABC News has the skinny:

Iraqi Prime Minister Nouri al-Maliki opened the conference with an appeal for all participants to help ease his country's plight and prevent the violent conflict here from spilling over into the entire Middle East.

But the conference underscored the wide gulf between American and Iranian views over the nature of the crisis and the ways to end it.

During the talks, U.S. envoy David Satterfield pointed to his briefcase which he said contained documents proving Iran was arming Shiite Muslim militias in Iraq.

"Your accusations are merely a cover for your failures in Iraq," Iran's chief envoy Abbas Araghchi shot back, according to an official familiar to the discussions who spoke on condition of anonymity because he was not authorized to release the information.

The U.S. ambassador to Iraq, Zalmay Khalilzad, only said that American delegates exchanged views with the Iranians "directly and in the presence of others" during talks, which he described as "constructive and businesslike."

But Labid Abbawi, a senior Iraqi Foreign Ministry official who attended the meeting, confirmed that an argument broke out between the Iranian and American envoys. He would not elaborate.

I'd like to say again, for the record, that this was a bad idea. Syria and Iran shouldn't be consulted on anything regarding stability, security, etc., in Iraq. Neither country gives a rat's patoot about Iraq. They're waiting for a collapse so they can set up Hezbollah, or some other terrorist group in that nation in the same way that the Taliban propped up al Qaeda in Afghanistan. It's nice to see that our envoy isn't backing down from the mad mullahs in Tehran and their lapdog diplomats.

On a brighter note, though, it seems that Iran's having some financial difficulties, of late. In fact, according to the Independent, they're economy is "on fire":

A complete failure to invest in refining and the hostility to the use of Western technology has ensured that Iran imports much of its refined oil from the United Arab Emirates (UAE). Rather bizarrely, petrol has recently been rationed in some instances and is subject to strict government control - a whopping 86 per cent price increase has been proposed. On current trends, Iran would cease to be a net oil exporter altogether in 2015.

This seems to be extraordinary economic mismanagement. Despite a 20 per cent increase in the national budget last year, Mr Ahmadinejad had to go back to Iran's parliament, the Majlis, six times to ask for more money. Government expenditure is extremely high and rising - a pledge to reduce budgetary dependence on oil supplements by 10 per cent each year has been thrown aside as the government has resorted to using the Oil Reserve Fund as its piggy bank. Commentators speculate that Iran has inadequate foreign currency reserves to negotiate the demands of the coming year.

In fact, the extent of government borrowing from Iranian banks is jeopardising the solidity of the Iranian banking system. The borrowing increased by nearly 50 per cent last year and this swollen government sector carries significant knock-on inflationary implications. The official target for inflation is 9.9 per cent but the current rate is thought to be at least 20 per cent, and rising. In certain foods it is closer to 40 per cent and some fresh vegetables are disappearing in Tehran.

A large part of this economic crisis is home-grown but the tightening of American sanctions must give the economic planners even greater head-aches. The US has become much more adept at using its financial muscle to persuade non-American banks to withdraw financing from its chosen enemies. This is what lay behind the Palestinian Prime Minister, Ismail Haniyeh, being caught bringing $35m across the Egyptian border into Gaza.

Now, as Allah notes, they've been down this road before, so it really doesn't faze Ahmadinejad much. But, what does it say when you start rationing gasoline? That is, aside from the obvious, which is as an oil rich nation you still haven't developed the necessary refining capabilities, and have to import oil from other countries?

Iranians are bracing themselves for a fresh round of belt tightening after their government voted to impose petrol rationing coupled with sharp rises in the price of fuel.

The rationing system will limit Iranians to 22 gallons (100 litres) of petrol a month, two full tanks for a typical family car. It is a direct result of President Mahmoud Ahmadinejad's adherence to an economic model, based on Iranian self-sufficiency, that has caused housing and other living costs to soar.

The basic price of petrol will rise by 25 per cent, but Iranians who need to use more than the permitted amount will be hit by rises of up to 450 per cent.

Economists predict that the knock-on effect on the average Iranian will be dramatic, with retailers expected to pass on the additional costs to consumers.

Ahmadinejad's idea at being sdelf-sustaining isn't going to work over there. It's already failing. And as long as they continue going forward with their nuclear program, they will continue to find themselves more and more isolated. It will simply get worse for them, and the worse it does get, the more outraged people will get. It's not like the government can keep honking it's people off like this. There are daily demonstrations in Iran against the mad mullahocracy.

And to answer Allah's exit question: Yes. Mahmoud Ahmadinejad IS the Persian Jimmy Carter. Best he stay over there, and it'd probably be beter if we sent his twin over to live with his beloved Palestinians. Maybe they can do lunch somewhere down the road.

Publius II
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