MICHEL MARTIN, HOST:
Has the U.S. blockade inflicted the kind of economic pain on Iran that the Trump administration envisioned? We're going to ask Miad Maleki. He was a senior official at the U.S. Treasury Department who designed and helped implement sanctions against Iran and its proxies in the past. He is now a senior fellow at the Foundation for Defense of Democracies. That's an organization that has close ties to the U.S. and Israeli national security establishments.
For transparency, we want to tell you that over the weekend, White House spokeswoman Olivia Wales confirmed that a former member of the foundation's lobbying arm has joined the U.S. negotiating team. With that being said, Mr. Maleki, welcome. Thanks so much for joining us.
MIAD MALEKI: Thanks for having me.
MARTIN: So let me just start with a new development. President Trump posted on social media that, as Mara just told us, starting today, the U.S. will guide ships through the Strait of Hormuz. Initial thoughts about that?
MALEKI: You know, I think the announcement really matters as a signal to markets, to our allies and also to Tehran that the U.S. administration intends to re-establish free transit. But this is just a signal, and the details of the plan are not really clear yet. And, you know, the key here is the idea. The plan that we're hearing about is for the U.S. Navy to guide and not escort commercial vessels. Maybe that - that might change as Iran might resuming attacks against tankers in the Persian Gulf.
MARTIN: So let's go to the reason that we called you. It's been a few weeks since the U.S. imposed a blockade on Iran. What's your sense of the evidence of whether it is or isn't working?
MALEKI: Sure. I mean, I - you know, the blockade has imposed severe economic pressure. You know, this is the most significant pressure Iran has faced in its modern history. It cuts off as much as about $435 million a day in trade. That's import and export through sea-born, through Persian Gulf. Inflation, you know, had already exceeded 70% pre-war, and the rial, Iran's currency, has collapsed.
Food prices are up dramatically and I keep hearing that they're increasing every day. Now, on top of that, the important factor here to look at is that the regime has imposed one of the most sweeping internet shutdowns that we've ever seen anywhere in the world, costing tens of millions of dollars a day in additional economic damage. The regime's own numbers are about 35- to $50 million a day.
So the fact that they're willing to impose that extra pain on their own population tells you something. I mean, they're more afraid of what their people might do with internet access than they are of the blockade itself. The blackout, I don't think it's a defensive security measure. It's really just a regime admitting that it's lost legitimacy with Iranians. So the numbers are very clear. The blockade is working.
And here's what, you know, everyone needs to understand. And I'm sure a lot of folks who were in the government, like me, they know that the Iranian regime operates under pressure in a very unique way. They have a very practiced playbook. They drag out negotiations, they make public statements of defiance, use back channels yet to keep negotiations alive in just long enough to buy time and wait for the political winds in Washington to shift, wait for the American public to lose interest, and wait for a new administration to come in and offer something that both sides can call a win.
What they've done this time around is they created this situation that the blockade is not really letting them play that game again. So they're stuck in - they don't have a way out of it.
MARTIN: Look, on the other hand, the closure of the strait has trapped oil and fertilizer and a lot of other products in the Persian Gulf, driving up prices worldwide. If Iran continues its blockade, can the U.S. persist as well? Because this is a democracy and, you know, elected officials here are expected to respond to what their constituents are telling them.
MALEKI: That's a billion-dollar question. It's - I think that's exactly what the Iranian regime is banking on, the pressure here domestically to really put an end to the blockade and give Iranian regime a lifeline. And the reality is that if this is not addressed right now, we're going to have to deal with this again. As long as they exist and they have that control over the Strait of Hormuz, they're - we're going to have to deal with this again.
MARTIN: I understand your point, but I'm asking you right now - right now, who has the greater pain tolerance?
MALEKI: I - you know, I think we can still keep going for maybe a couple more weeks or a couple month. But what I can tell you is the Iranian regime is facing really a crisis domestically. They're definitely under way more pressure than any other economies in the world right now.
MARTIN: OK. That is Miad Maleki. He's a former senior treasury official. He's now a senior fellow at the Foundation for Defense of Democracies. Mr. Maleki, thanks so much for joining us.
MALEKI: Thanks for having me. Transcript provided by NPR, Copyright NPR.
NPR transcripts are created on a rush deadline by an NPR contractor. This text may not be in its final form and may be updated or revised in the future. Accuracy and availability may vary. The authoritative record of NPR’s programming is the audio record.
