Yes, this is exactly how actors build leverage in complex negotiations - they identify the other's weaknesses and exploit them as bargaining chips for things that they want.
The Iranians should know that should they choose to raise the level of violence in Iraq through their "special groups", or the passing of more weapons to Shiite gangs, that we have the ability to destabilize their nation without overt military action.
You forget that a mere two years ago, Iran felt itself on the cusp of achieving regional hegemony. Had the US withdrawn from Iraq, Teheran may have accomplished its objectives.
To claim that America is a hegemon that everyone takes seriously, regardless of circumstances, disregards the facts. Since the US invasion of Iraq, the Iranians were developing the very type of leverage over our interests in the region that you would now deny us. They funded, staffed, trained and supplied their own terrorist militias in Iraq, and contributed to destabilizing our position in Afghanistan as well.
For too long we ignored their growing ability to direct events in Iraq, but the rise of Iran-backed Shiite militias in 2006 exposed their policy of undermining our interests and those of the fledgling Iraqi state as coherent, developed and well advanced.
We have spent the past two years scrambling to develop our own leverage, without which negotiations would have yielded nothing but a surrender of American forces in Iraq.
1) Most importantly, we made peace with the Sunnis and built them up into half-credible army, demonstrating to Iran that we were willing to resume a policy of blocking Shiite expansion with a strong Sunni military force on their border. This is their nightmare - a resumption of the Iraq-Iran bloodbath of the 1980s.
2) We began to target and engage their "special groups" operating in Iraq, capturing their operatives and untangling the networks they had put in place.
3) Having unified the Sunnis under our banner, we focused on the Shia, who had by this time devolved into inter-Shia rivalry and open warfare. The Badr Brigades and their political wing had by this time been largely incorporated into the Iraqi Army and government agencies, but ISCI was facing a direct challenge from Sadr's Mehdi army, which had been organized and supplied by Iran.
The Iranians wanted Sadr to have a bigger piece of the political pie in order to have more direct control over Iraqi government affairs. ISCI, which dominated the government and army, refused.
As the interests of the Iraqi Shia and the Iranians diverged, we exploited the situation to launch a joint war on the Mehdi Army, Tehran's primary conduit for manipulating events in Iraq.
With the Mehdi army being drawn and quartered, and gaining nothing from Shia fighting Shia, Tehran ordered Sadr to Iran and declared a ceasefire to salvage whatever of his organization and political capital remained.
For the next year - 2007 - locked in stalemate, and with leverage on both sides, we began negotiating with the Iranians. This was a main contributing factor for the reduction of violence. The Iranians held back their militias and allowed the government to exert more control over the country, with our support.
Meanwhile, we and the Sunnis wiped out al Qaeda, which had spent the previous three years butchering the Shia in their thousands.
Our negotiations with the Iranians are at an advanced stage. No one is going to get everything they want, but we will both avoid our worst case scenarios. Iraq will be a US-supported Shia government, strongly influenced by Iran, but not dominated by it.
We avoid an Iranian puppet state that can flex its muscle across the Gulf, and the Iranians avoid another Saddam on their border.
As the negotiations progress, it sometimes becomes necessary for one side to remind to the other that it can still achieve the other's worst case scenario, but this is just a tactic designed to further negotiations, not to detract from them.
As I said, I am betting that Iran will reach an agreement with the US on ALL issues - Iraq, nuclear, etc. - before Bush leaves office. It may not be a Camp David style accord, but it will happen. After both sides have put in this amount of work, it would be foolish for the Iranians to roll the die with a new President who needs to prove himself.
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