Often we hear "Money is the route of all evil." History, however, shows us that as evil as money allegedly is, money is the key to peace in international relations. The recent sanctions for Iran and its imminent economic free-fall put the country at an important crossroad, and money is the kingmaker.
Obama’s approach to Iran is bipartisan business as usual (meaning with no real end goal), and includes imposing economic sanctions and refusing to take armed conflict off the table. With Iran’s economy in the precarious state it is, it is important to not force the Iranian people into a corner, but rather offer them an opportunity to stake their claim for economic prosperity.
It is very important to clarify that a dysfunctional or problematic economy leads to conflict, and vice versa. Nazi Germany was born out of an economic disaster. Hyperinflation in Germany was so bad after World War 1 that wheelbarrows of deutschemarks were needed to buy basic groceries. At one point, workers got paid three times a day so they could go outside and quickly give the money to their wives so they could spend it before the money became further devalued. The people wanted change and so supported the rise of Hitler, who was very populist and charismatic, a true demagogue.
Another example is the civil war in Yugoslavia, which was not actually caused by nationalism or religion but by a completely failed economy. Hyperinflation, unemployment, and a failed Frankenstein-like government preceded the conflict and ultimately forced people in the absence of wealth to cling to what was left – nationalism. Many results of a failing economy, especially unemployment, lead to nationalism and conflict. On the opposite side, historically and especially recently, countries with a liberal economy that focus on trade rarely go to war with one another, much less face civil conflict.
Where does this leave Iran? Well, a crippled economy will mean the average citizen will suffer. Unlike North Korea, Iran is nowhere near as isolated from the remainder of the world, and it would be much more difficult to brainwash Iranians into blaming the West for their hardships. Likely, it would rather lead to further discontent with the Iranian government. In 2009, after accusations of electoral fraud occurred, we saw the first Arab Spring in Iran. Massive protests continued for over a month's time, on some days numbering over one million protestors, and were eventually shut down by the Iranian government. It would be safe to say there is still much anti-Ahmadinejad sentiment in Iran, and a deteriorating economy could only result in either compromise from the Iranian government, or an even bigger revolution than in 2009, which would be wise for the Iranian government to avoid.
The key to the Iranian issue is to keep the people hostile against their own government, and hope for more to join. Crippling the economy will leave the average Iranian citizen blaming no one but his/her own leaders. The end scenario is that either Iran makes drastic compromises, or gets overthrown by its own people. A military intervention by the U.S. however, could very easily lead to even anti-government Iranians putting their domestic disdain aside and joining a unified anti-American front. Just because they dislike their own government does not mean they will tolerate any attacks on their country. The same can be said for Americans who dislike their own government.
Expect Iran to start compromising, as it is not merely their economy they risk damaging, but the livelihood and subsequent support of their own (already disgruntled) citizens. A military attack on Iran severely risks mobilizing the population and solidifying support for the government. And this reaction would be funded by none other than the American taxpayer! At the end of the day, the average Iranian (and every other human being in the world) would prefer to have sufficient money to feed his family over knowing his country his nuclear weapons, that may or may not work.