CARPER: Subcommittee will come to order.

Welcome, Senator Specter. And very soon we'll be joined by Senator Feinstein and a number of my colleagues. I want to thank you for joining us today, and our other witnesses who will be coming in the moments ahead.

I'm especially delighted that Senator Specter, ranking member of the Senate Judiciary Committee, and former chairman of the Senate Intelligence Committee, and Senator Feinstein, a member of both the Intelligence and the Judiciary Committees can join us this morning to kick off this hearing.

Thank you both for your willingness to share your informed views on what the United States should be doing in relations to Iran. If now is a time for creative, courageous ideas, your voices, colleagues, should figure prominently in that discussion.

Senator Specter, your entire statement will be entered into the record. Feel free to summarize it however you wish, but we're delighted that you're here and we thank you for your leadership in this issue and, frankly, for encouraging us to reach out openly to other countries with whom we don't always agree.

Thank you.

SPECTER: Thank you, Mr. Chairman. And I begin by complimenting you by starting on time. I note the presence of all the other expected participants, but it is a unique practice in these hallowed halls.

I compliment you, Mr. Chairman, and the subcommittee, for undertaking this issue, because it is of such vast importance that it ought to be considered by a broader range of members of Congress in trying to move a realistic policy toward Iran. All of the major issues confronting the world are tied up in the U.S.-Iran conflict: terrorism, military nuclear capabilities, energy, Iraq, the Palestinian dilemma, the presence of Hamas to the Hezbollah as destabilizing forces. And in this context, there is for some strange, I think, inexcusable reason, at least in my opinion, the United States refuses to engage in direct bilateral talks with Iran.

Two propositions span centuries, but articulate what I think are the sensible approaches. Sun-tzu's advice was to, quote, "Keep your friends close and your enemies closer," close quote. President Ronald Reagan said, on November 21, 1985, in an address to Congress following the U.S.-Soviet Geneva Summit, "We agreed on a number of matters. We agreed to continue meeting. There's always room for movement, action, and progress when people are talking to each other instead of about each other."

Perhaps not relevant, but the first assignment I had as an assistant district attorney decades ago was to interview inmates under the death sentence at the Pennsylvania State Prison. My job was to get their views as to why they ought to have the death sentence changed to life imprisonment. And I found that they were people like anybody else -- thugs, violent criminals, reprehensible, but human beings.

The experience I have had in my work on the Senate Foreign Operations Subcommittee and the Intelligence Committee, which I chaired during the 104th Congress, has led me into contacts with some of the world's reportedly unsavory people: Syrian president Hafez al- Assad, his successor, President Bashar Assad, Palestinian chairman Yasser Arafat, Iraqi president Saddam Hussein, Cuban president Fidel Castro, Venezuelan president Hugo Chavez, and Libyan leader Moammar Gadhafi. I have found that there is an ingredient which runs through all of these discussions, and that is the ingredient of civility and courtesy in dealing with people, and not to demean them.

I think it is a great act of foolishness to try to tamper with somebody else's pride, and I think that is what we do with Iraq when we take the proposition that we will engage in bilateral talks on the condition that they cease enriching uranium. Well, that's the object of the discussion.

So how, in good faith, can there be an insistence that the other party make the concessions sought in the dialogue, in the negotiations, as a precondition to meeting? Seems to me it is exactly wrong, and I have asked the secretary of state -- the deputy secretary of state -- on the record, that question recently and have gotten a very unsatisfactory answer.

In discussions that I've had with Hafez al-Assad on many visits to Syria since 1984, I think it is not an overstatement to say that perhaps there was a little influence on Assad. He was totally opposed, in 1991, to attending the Madrid Conference, unless all five super-powers participated. He wanted to have four allies, with the United States being Israel's only ally. But he finally relented, sent representatives to Madrid with only the U.S. and the USSR there.

I had early conversations with him about letting the Jews leave Syria, and he was opposed to the idea. They were Syrians and they ought to stay in Syria. But whatever factors ultimately led Hafez al- Assad to change his mind, he did, and he let the Jews leave.

There has been no blacker thug terrorist in history than Moammar Gadhafi. Maybe others could challenge him for that title, but I don't think any could exceed him, and I doubt that any even equaled him.

Blew up the discotheque in Berlin, which resulted in the killing of American soldiers, brought down PanAm 103, which he's later conceded, has made reparations, has decided that he wants to come back into the family of nations. And he stopped his activities on developing nuclear weapons, and if you can talk to Gadhafi, and you can make a deal with Gadhafi, you can make a deal, I think, with anyone.

Regrettably, the jury is still out on North Korea, but there have been promising developments, but only when the United States was willing to, in a dignified way, negotiate bilaterally with North Korea. And I think that is an illustration of where you have to maintain the multilateral talks, because I think we must continue with multilateral talks with Iran, but there's not substitute for direct, dignified negotiations.

Two more brief points. You've been very generous, Mr. Chairman, in not starting the time clock, but I will not abuse the courtesy.

One is a comment which was made to me by Walid al-Moallem, who is now the Syrian foreign minister, when he was the Syrian ambassador to the United States, a position he held for about a decade. He said to me, "We like you because you don't hate us." I thought that was the most extraordinary statement; such a modest, really low threshold for acceptance.

Why should it be a unique mark for one man not to hate another man or woman -- one man or woman not to hate another man or woman? But that's what he said to me.

And when I wrote a book eight years ago, I wanted to put it in the book. But before I did so, I asked Walid al-Moallem if it was acceptable to him to put it in the book. But that's the level of courtesy which is sub-minimal.

The final point on the Iranian-U.S. relations is what I think is the importance of developing the idea by Russian president Putin to have Russia enrich Iran's uranium. And that way, there could be certainty that the uranium was not being used for military purposes.

And that idea has gotten very little publicity, and when Secretary of State Rice was before the Appropriations Committee a couple of weeks ago, I raised the issue with her. She thought it was a good idea, and I urged her to develop it.

I think we put Iran on the defensive, justifiably, on that point. They have no reason, aside from national sovereignty and pride, which is insufficient reason on the premises, not to do that.

Thank you, Mr. Chairman.

CARPER: Senator Specter, thank you for an excellent statement. We've been joined by Senator Feinstein, and just before I recognize Senator Feinstein, let me just ask two quick questions of you, Senator Specter, and we're just delighted that you are both here today, just delighted.

Senator Specter, you were a member of the Senate for, I think, the final decade of the Cold War; you've alluded to that in your statement. Let me just ask what parallels can be drawn between that conflict and the current impasse that we face with Iran? What lessons should we take from our experience in the Cold War and apply those to the formulation of our policy today with respect to Iran?

SPECTER: I believe there is a close parallel and a great lesson to be learned, and that is to note that President Reagan declared the Soviet Union to be the "evil empire," just as President Bush has declared Iran to be the "evil empire." And then President Reagan promptly initiated bilateral, direct talks -- a series of summit meetings -- and the quotation I read was the agreement on many matters, and the agreement to continue talking, which President Reagan recommended. And he's a pretty good role model for the current administration, I think.

CARPER: Thank you. One last brief question is, how do you respond to the argument that Tehran is at fault for the absence of a U.S.-Iranian dialogue, as the Bush administration has, I believe, offered Iran bilateral discussions, but Tehran has turned the offer down by not first suspending their enrichment and reprocessing efforts?

SPECTER: To offer bilateral negotiations with a precondition is no offer at all, in my judgment, especially when the precondition is the object of the negotiations. Beyond that, Mr. Chairman, I'd be more direct and say that it was insulting, which I think characterizes a good bit of U.S. foreign policy, which has earned us the title of the "ugly American."

But it's not a one-way street; Iran does pretty well on bilateral insults. The object is to try to move from that level of discourse to civility.

Mr. Chairman, as I told you before, I have to excuse myself. I will follow what Senator Feinstein has to say as I always do, but I'm ranking on the Judiciary Committee, and I expect to have some civil, but fiery, dialogue on the confirmation issue in 15 minutes.

CARPER: As you prepare to take your leave, again, I thank you.

I've admired him in the Senate for seven years.

I've very much admired both of you, the work that you do, and most of all I appreciate the partnership that you've shown in providing leadership for the rest of us on a wide range of issues. And that certainly includes the issue that's before us today.

Senator Specter, thank you so much. We'll see you later on the floor today, but much obliged.

SPECTER: Thank you, Mr. Chairman.

CARPER: Senator Feinstein, welcome. We're delighted that you've come. Thank you. I know you had to adjust your schedule, but it means a great deal to me that you're here, and we welcome you.

Whatever statement you have for the record, it'll be included in its entirety. You're welcome to summarize as you with, but thank you so much for joining us.

FEINSTEIN: Thank you very much. Thank you and Senator Coleman.

For many years now, I've been interested in trying to be a constructive force for peace and stability in the Middle East, which I think most of us regard as the powder keg in which nations and values collide. I've watched as the Iraq War continues, Israeli and Palestinian peace remains elusive, Iran begins to exert itself in the region, and Sunni nations grow more and more concerned.

Iran today, isolated and belligerent, constitutes both a present and future challenge to the stability and security of many concerned nations, as well as our own. Last year, the United States indicated its alarm about Iran supplying weapons and tactical support to Shia militias, and the administration has called Iran "public enemy number one" in Iraq.

Also, Iran's support of terrorist organizations, particularly Hezbollah and Hamas, remains of deep concern and continues unabated. And finally, the government of Iran's intransigent hatred of Israel and its willingness to deny Israel the right to exist is unacceptable, and a major hurdle to peace and security in the region.

So it is within this context that we must understand the number one question of the day: Does Iran seek nuclear weapons, and for what purpose?

The November 2007 United States intelligence community released a national intelligence estimate, which we call an NIE, on Iran's nuclear program. It was an eye- opener, and the source of major controversy.

The NIE's first conclusion, front and center, was that the intelligence community judges, quote, "with high confidence that in the fall of 2003, Tehran halted its nuclear weapons program." This signified a major shift from the judgments of past intelligence reviews.

I serve on this committee -- the Intelligence Committee -- I have reviewed both the classified and unclassified versions. To my knowledge, they have never been contraindicated.

A footnote in the NIE made clear that a nuclear weapons program has three parts: one, the enrichment of fissile material; two, a weaponization program to make that material into a weapon; and three, a means to deliver the weapon. Now, the halt refers specifically to the weaponization part. The other two parts -- the enrichment of fissile materials and the making of a delivery system -- remain serious concerns.

But equally as clear, the NIE judged, again with high confidence, that until the fall of 2003, Iran was pursuing an illegal, covert nuclear weapons program. This was the strongest intelligence statement to date. It is backed up with evidence in the classified text of the NIE that Iran had, in fact, a program, and that Iran's leaders in Tehran could turn that program back on at any time.

Finally, the NIE made a statement that is central to the question of whether and how to approach Iran diplomatically. It said, and I quote, "Our assessment that the nuclear program probably was halted, primarily in response to international pressure, suggests Iran may be more vulnerable to influence on the issue than we judged previously," end quote.

The NIE, in essence, suggests a window of opportunity to begin to engage Iran in discussion, and with the help of European and other allies, to see if Iran can be moved toward positive engagement with the western world on this vital question as well as other issues of concern. So, this NIE, in my view, presents the first opening for real engagement.

The question is, how should we proceed with Iran? I believe we should begin to pursue a robust diplomatic initiative with Iran on all issues, and like Specter -- Senator Specter -- without preconditions. Working with our European allies, the United Nations, the International Atomic Energy Agency, we should put together a package of carrots and sticks that will serve as the basis for discussion with Iran.

The goal would be to convince Iran to permanently abandon any intention to restart a nuclear weapons program. Secondly, to allow the International Atomic Energy Agency inspectors full access to all Iranian nuclear facilities and suspected nuclear facilities. Third, to comply once again with the additional protocol to the Nuclear Nonproliferation Treaty for intensified inspections by the IAEA -- Iran had actually accepted this in 2003, and then suspended compliance in 2005 -- provide an accounting for all past nuclear activities and allow full transparency to international inspectors, cease its support for the terrorist activities of Hamas and Hezbollah worldwide, and promote stability and cease lethal support to militias in Iraq.

The key is this: We can recognize that Iran has a right to a peaceful civilian nuclear energy program, but not to nuclear programs -- nuclear weapons programs. Now of course, there is not guarantee that these talks will succeed. It's likely to be a long and difficult road, but we are sure to fail if we do not at least try.

One proposal that deserves a closer look is one which was described to me by Iran's former ambassador to the United Nations. It is similar to one made by Ambassador Bill Luers, Secretary Thomas Pickering, and Jim Walsh. Mr. Walsh is on the second panel today.

The basic premise is this: Establish an on-the-ground 24/7 international consortium to manage and monitor all aspects of nuclear activity. This is something that Iran might actually consider as long as there is an openness on the part of the United States to discuss other issues as well.

In other words, no preconditions, an open table, come in and both sides present their views. Participants could include the United States, the United Kingdom, France, Germany, China, Russia, the United Nations, and the IAEA.

Such a proposal deserves serious consideration and could go a long way toward building confidence on both sides. Remember, we haven't talked to Iran in 30 years. Our Military don't talk to their military.

Isolation, we should have learned well by now, is a very dangerous posture to push a nation into. We saw it with North Korea, and it is happening with Iran as well.

I believe that an Iranian policy based on a military solution makes little sense. Only by talking and bringing to bear the best efforts of diplomacy can real progress be made.

The next administration must evaluate anew our nation's approach to this Middle Eastern arena and evolve a new approach, one based on robust diplomacy rather than constant threat of war. The process is likely to be difficult; we all know that. But the rewards may well be significant, and one day it could lead to a more stable and peaceful Middle East.

Thank you very much.

CARPER: Senator Feinstein, thank you for an excellent, excellent statement, and for thinking outside the box, as you do in so many other arenas. Do you have time for one quick question from me?

FEINSTEIN: I do.

CARPER: And I know you have your Judiciary Committee that's about to begin its work as well. Just thinking again about the proposal you've laid on the table, the question I would ask -- not just rhetorically, but just ask -- what do we have to lose in pursuing what you just prescribed?

FEINSTEIN: Well...

CARPER: What is the downside? What do we have to lose?

FEINSTEIN: We do not have anything to lose, and I think there is a very short understanding of the Iranian government, as well. The president, Ahmadinejad, this is not his arena; it is the arena of the supreme leader. And the need is really to develop contacts that run to the supreme leader and try to open a floor for constructive dialogue.

There have been some back-channel negotiations among certain Americans and Iranians. I think there is reason to believe that there are many Iranians that do not want their country to have a nuclear weapons program.

There are many Iranians that see that peace and stability and economic upward mobility of their country offers their citizens much more than a belligerent stance does, and that isolation is not to the benefit of Iran. It is not to the benefit of other nations as well.

And as we watch Iran extend its influence, as we watch the Revolutionary Guard buy properties in Iraq, set up businesses in Iraq, extend their influence into Iraq, coming to grips with Iran becomes more and more important if we ever want to affect a stable region.

CARPER: Thank you.

FEINSTEIN: You're very welcome.

CARPER: Senator Coleman, would you like to ask a question of Senator Feinstein?

COLEMAN: No. I know that the senator's busy. I appreciate that the senator's one of the most thoughtful members of this institution.

I have some, perhaps, some different perspectives on some of this, but I always greatly appreciate the, as you talked about, out- of-the-box thinking, very thoughtful approach. And hopefully we'll figure out some common ground and a way to move forward, but I thank the senator for her presentation.

FEINSTEIN: Thank you, Senator. I appreciate it.

COLEMAN: Thank you so much.

FEINSTEIN: Thank you, Mr. Chairman.

CARPER: I'm going to go ahead and give an opening statement. It's going to run a bit beyond five minutes, and I would just beg your indulgence as my colleague, Senator Coleman, and others who join us.

Before we welcome the first panel, let me just say this: Iran is considered the world's most active state sponsor of terrorism. We know Iran is behind Hezbollah, Hamas, Palestinian Islamic Jihad, as well as militant Shia elements in Iraq; our first two senators have already indicated as much in their statements.

In his Senate statement testimony on April the 8th, General Petraeus stated that Iranian armed militias are the biggest threats to stability in Iraq. Furthermore, Iran has started arming the Taliban.

Iran is a formidable threat. Obviously a nuclear weapon makes it even more so by giving Iran the confidence to frustrate U.S. policy objectives without fear of U.S. reprisals.

Although military strikes against Iranian nuclear sites should remain on the table, they would prompt widespread retaliation throughout the region, would lack international support, and would therefore be ill advised, presently. In fact, our secretary of defense said, in a meeting that we had several months ago with a number of senators, when asked what the practical effect would be of a nuclear strike, or a military strike by the U.S. against the Iranian nuclear targets, and he said, "They're a lot smarter than the Iraqis used to be." You know, the Iraqis, they built their nuclear facilities open -- put it up out in the open, above ground, almost like the put a bull's eye around that said, come and get us.

The Iranians are smarter. They're dispersed their nuclear activities; they've put them underground. And Secretary Gates (inaudible), and I'll paraphrase what he said. He said: One thing I'm not so sure that we'd be effective in taking out their nuclear facilities. One thing I know for sure, we would rally the Iranian people to the support of their president in no other way that I could think of.

But anyway, there's little evidence that deterrence (ph) has or would work. Regime change after Iraq is no longer viewed as a realistic short-term option, even to those in the Bush administration.

Given a lack of good alternative options, a more robust diplomacy, to quote Senator Feinstein, which would include comprehensive talks with the Iranians that address both its nuclear program and its support of terrorism, might be better of the not-so- good options presently before this country. The December 2007 National Intelligence Estimate stated that Iran had stopped its nuclear weapons development program in the fall of 2003, and although the NIE's release led some to question the immediacy of the Iranian threat, it affirmed Iran's continued enrichment of uranium and its simultaneous pursuit of ballistic missile delivery capabilities.

As former Undersecretary of State Nicholas Burns recently said, "The straightest avenue to nuclear weapon capability is not weaponization, but enrichment and reprocessing." Given that the production of fissile material is the most challenging aspect of the process of building a nuclear weapon, Iran's continued enrichment of uranium is cause for real concern and warrants continued action by the U.S. and the international community.

While there is a shared view among most observers to prevent a nuclear Iran, the primary goal of the Bush administration's policy, there is vigorous disagreement about how the U.S. should try to achieve that goal. I call this hearing for that purpose: to examine what the U.S. and its allies must do to develop a more effective Iran strategy and to discuss, specifically, what actions we should continue or should consider taking in light of what we learned last December.

I believe that the way to stop, or at least to mitigate, Iran's enrichment activities is to present Iran with an enhanced set of carrots and sticks, not unlike those suggested by Senator Feinstein, in order to change its cost-benefit analysis of the issue. Hammering out those incentives and disincentives is the challenge that's before us.

To its credit, the Bush administration has shifted rather significantly in recent years from rhetoric centered on regime change to a more pragmatic approach in dealing with Iran through multilateral talks with other permanent members of the U.N. Security Council, China, France, Russia, Britain, plus Germany. Part of this diplomacy included a package of incentives that the U.S. offered Iran in 2006 with the stated objective that if Iran suspended its enrichment- related and proliferation-sensitive activities, our Secretary of State Condoleezza Rice would meet directly with her Iranian counterpart to discuss anything. But Iran refused.

Two years of respectable but inadequate diplomatic efforts and four U.N. Security Council resolutions later, all of which impose sanctions on Iran until it suspends its enrichment-related and reprocessing activities, have not led Iran to do so, nor do many experts think that this path will prevent a nuclear Iran from emerging. In fact, some now assume a nuclear Iran as their starting point for how the U.S. should approach Iran. I am not of that mindset, and agree that it should be U.S. policy to prevent a nuclear Iran.

Add to this the Iranian president's April 8th pronouncement that Iran's scientists and experts have started to install 6,000 new centrifuges at Natanz' uranium enrichment facility. These are in addition to the 3,300 that the director of the International Atomic Energy Agency said are already operating there.

Furthermore, Iran has stated that it will move toward large-scale uranium enrichment that will ultimately involve 54,000 centrifuges. Finally, last weeks talks in Shanghai by the permanent members of the U.N. Security Council plus Germany and the European Union, which focused on incentives to get the Iranians to stop their nuclear program, ended with no clear outcome.

These disturbing facts lead to a series of urgent questions. First of all, last weekend Secretary Rice stated, this is a quote, "This is not the time, I think, to expect major changes," close quote -- in terms of either incentives or sanctions.

What, therefore, will the U.S. do in the short-term, say between now and January 2009, vis-a-vis Iran? And how, further along down the road -- the nuclear road -- will Iran be?

Although I continue to be a believer in progressively ratcheting up sanctions on the Iranian regime, which is why I co-sponsored S. 970, the Iran Counter-Proliferation Act, can we expect the relatively low-impact sanctions of the U.N. resolutions to ultimately force Iran to cease its enrichment activities? If not, what are we aiming at?

Why does the U.S. continue to insist on preconditions to negotiations with the Iranians? What other changes in U.S. policy should be considered that may alter the Iranian decision-making calculus with regard to its nuclear ambitions?

To what extent would a position that allows Iran to continue enrichment work while negotiations on a final settlement are proceeding undermine the four U.N. resolutions that demand that Iran suspend uranium enrichment? Should the next administration consider direct talks with Iranians without preconditions?

Realistically, what would direct talks accomplish? How should those talks be structured?

What lessons can we learn from our involvement with North Korea and Libya, and are any of those lessons applicable to Iran? And finally, how do we prepare for the possibility that our best efforts might not persuade Iran's leaders?

Today, with those questions in mind, I want to try to do the following: First of all, to accurately assess to date the diplomatic efforts of the Bush administration; and second, to discuss the most effective, or at least least bad, strategic policy option regarding Iran; third, to analyze the pros and cons of specific proposals about how to approach Iran; and fourth, to review what lessons, if any, can be gleaned from the U.S. involvement with North Korea and with Libya, and how those actions might be applicable to Iran; and to solicit ideas about how Congress can play an active and effective role in the path forward.

Again, we welcome our witnesses. We thank you all for joining us today and for the time and energy that you've put into preparing for your statements and your responses to our questions.

And Senator Coburn's going to be joining us shortly; I think he's involved in the same Judiciary Committee hearing that's taking place.

I'm delighted that we've been joined by my colleague from Minnesota, and I would be pleased to recognize Senator Coleman for whatever statement he might wish...

COLEMAN: Thank you, Mr. Chairman.

I don't have a formal statement. I want to make some, just observations, and it's dangerous because I don't have notes on this, but I just want to respond a little bit, just at least to set the stage, and then listen to the witnesses and inquire further with them.

But I do appreciate the thoughtful presentation of my colleagues, and I appreciate the thoughtful manner in which you approach this. And these are complex issues; this is not easy stuff.

You asked the question, you know, what do we have to lose in, without preconditions, moving forward? I would suggest that particularly if you look at the North Korean example, that what we have to lose, if not done correctly, is the support and confidence of our allies in the Middle East.

I'm ranking member on the Near East Subcommittee; I can tell you that the Iranians are of deep concern, the near threat to the Saudis, to the Jordanians, to the Egyptians. The greatest threat facing stable governments in the Middle East is terrorism -- it's Hamas, it's Hezbollah -- threat in Syria and Lebanon.

And so if you look at the North Korean experience, where we actually pulled together six-party talks because we understood that direct negotiation was unlikely to yield any fruitful results due to the prior history with North Korea, and it needed others in the region who have a stake in this, the reality is that Iran isn't just the United States' problem, and it's not just Israel's problem. Iran's a threat to the House of Saud; Iran's a threat to Abdullah in Jordan; Iran's a threat to stability in the entire region. And I don't think that it is asking too much when we say without preconditions.

Iran, right now, is engaged in what I would -- I'm going to say this very straightforward -- in acts of war against this country. They're killing American soldiers. There's no question whatsoever that Iranian support for the Iranian Revolutionary Guard -- the cuts (ph) for support of terrorist organizations in Iraq, supplying them with the most modern, explosively formed projectiles, they are actively involved in killing coalition soldiers.

In other times that's an act of war, and I don't think it's asking too much as a precondition to sit down and talk about the larger issues. I agree, certainly this issue of the nuclearization, which is the big issue -- that's the 800-pound gorilla. But before you sit down with someone, to say as a precondition for us to have a fruitful conversation, "We'd like you to step back from supplying weapons that are killing our soldiers. We'd like you to cut off your training of terrorists in the region. And then we could talk to you."

Because I do believe, Mr. Chairman, that we need to be ratcheting up the talks at a higher level than they are now. There's just no question that I think we're messing up, because there are talks going on -- I think this is public information -- at the sub-ambassador level, but I do believe that it is reasonable in international diplomacy to, before you sit down with someone, to say, particularly if they're involved in killing your soldiers, to have that kind of conversation.

And my fear would be that if we didn't, the way we would be looked at in the region would undermine our entire ability to move forward with promoting stability in the entire region. Talk to the Saudis; talk to the Egyptians; talk to the Jordanians; talk to the Kuwaitis. And so this is a complicated area.

We have to have levels of discussion beyond what we have now. The threat is real.

The NIE talked about Iran suspending weaponization but not uranium enrichment, which we know they're doing in violation of U.N. resolution, and not the delivery capacity, which we know they're doing. And the easiest thing to restart is weaponization. And our intelligence only goes back to '03; we don't know what they're doing today.

And so I applaud your efforts at pursuing a rational kind of conversation about how we move forward. But I would suggest, Mr. Chairman, that there is an affirmative answer of what we have to lose if done incorrectly. And what we have to lose in an undermining of our efforts to promote stability in one of the most dangerous regions of the world.

And so I look forward to the witnesses, and I look forward to the conversation, and I appreciate your leadership on this matter.

CARPER: Thank you so much.

Senator Coburn -- Dr. Coburn?

COBURN: Thank you. Mr. Chairman, I have a statement for the record, and I won't go through all that.

You know, the real principle here is reconciliation. What we find ourselves is alienated.

But the real practical matters in the world today is, we have no means of containment with which we can deal with the situation in Iran. And before we give up and lose all leverage with Iran, in terms of high-level talks, you have to have some other leverage somewhere.

And I know I missed part of Senator Coleman's talking points, but as I look at how we handled North Korea and how we're, in my thoughts, regrettably handling it today with no accountability and no transparency, we send a signal to the Iranians to stand ground because we're never going to do anything any different. So I'm adamantly opposed on how we're handling North Korea today, because I think it complicates our ability to deal with Iran.

They see weakness rather than strength. They see delay as their asset. They see lack of unity on our part. And what you hear from their leaders is statements about the destruction of one of our allies.

And it ought to be U.S. policy that if you attack Israel, you've attacked the United States. And that ought to be our policy, and it ought to be first and foremost our policy. And then we stand on that, and then we act in regards to that.

So, the rhetoric does need to calm down. Our statements against Iran or about Iran have nothing to do with the Iranian people, because they have what I would consider a despot government that doesn't reflect the true values of the Iranian people that I know, and their desires for a future.

So I look forward to our hearing, and I look forward to our testimony. We have a big problem in front of us, and it's not just this country that has a big problem.

The entire world has a big problem, because uranium enrichment in Iran means uranium enrichment in multiple other places throughout the Middle East. You can deny that if you want, but that's what's going to happen.

And we need to be prepared for that; we need to be unified in how this country stands, and we need to -- regardless of what's happened in the past, and there is a place for reconciliation, but reconciliation has to be built on trust, it has to be built on verification. And there's none of that now, in terms of true verification and true trust.

And so one of my biggest concerns is that we have failed in terms of our diplomacy through things such as Voice of America, through Radio Farda, through presenting the options in a standard and complete view of our viewpoint -- one that directs our respect and love for the Iranian people, but our disdain for the statements that have been made by the Iranian leadership. This is a difficult area, not just for this country, and I have some concern over our allies in terms of the -- we have three United Nations resolutions on sanctioning which are not effective, obviously, since we continue to see enrichment.

And if we're not going to push for more sanctions, then what we've said is that we, in fact, are going to allow enrichment to continue. And if we're going to allow enrichment to continue, then we're going to allow enrichment throughout the whole Middle East.

And we need to recognize that as the endpoint in this game. And then what we've done -- we have no more nonproliferation treaties, because we will have had proliferation throughout the entire Mideast.

Thank you.

CARPER: Dr. Coburn, thank you very, very much.

I'm going to invite our first panel of witnesses to join us, and as they come to the table I'll introduce each of them. Mr. Jeffrey Feltman is a career member of the U.S. Foreign Service, currently serving as the principal deputy assistant secretary in the Office of Near Eastern Affairs.

He previously served as U.S. ambassador to the Republic of Lebanon. He also headed the Coalition of Provisional Authority's office in the Irbil province of Iraq. He's spent much of his career in the Eastern European and Near East affairs.

Welcome.

Joining Mr. Feltman is Ms. Patricia McNerney -- did I pronounce that right?

MCNERNEY: McNerney.

CARPER: McNerney, yes. Welcome. Senior adviser to the undersecretary of state...

MCNERNEY: Sorry. That's my old job.

CARPER: OK. Well, why don't you tell us your new job?

MCNERNEY: I am the principal deputy assistant secretary for the International Security and Nonproliferation Bureau...

CARPER: OK.

MCNERNEY: ... and I'm acting head of that bureau.

CARPER: Terrific. Congratulations. We welcome you in that capacity as well.

We're delighted that you're here. Your entire testimony will be made part of the record; you're welcome to summarize it as you prefer.

And with that, Mr. Feltman, if you'd like to kick it off, and then we'll turn to Ms. McNerney.

MCNERNEY: Sorry. We had arranged that I would set it off, and then turn to Ambassador Feltman.

Mr. Chairman, members of the committee, I very much welcome the opportunity to speak with you today, and I look forward to your questions. I request that our full joint statement be placed in the record.

CARPER: It will be, without objection.

MCNERNEY: Iran presents a profound threat to U.S. national security interests. The radical regime in Tehran threatens regional and international security through its pursuit of technologies that would give it a nuclear weapons capability, obviously its support of terrorist groups and militants in Iraq and Afghanistan, its expansive regional ambitions, and its lack of respect for human rights and civil society.

From its location in crossroads of the Middle East and South Asia, a nuclear armed Iran could threaten U.S. national security interests on three continents, and even the U.S. homeland directly. The international community's failure to prevent Iran's acquisition of nuclear weapons would additionally imperil the international nonproliferation regime, as Senator Coburn had indicated, by casting doubt on our collective ability and commitment to prevent the spread of weapons of mass destruction abroad.

Our goal is to convince Iran to abandon its nuclear weapons program and urge Tehran to become a partner in bringing peace and stability to the region. The diplomacy to which we remain committed is the best course of action, we believe, in pressuring the Iranian regime to change its behavior. However, to respond to the range of challenges presented by Iran, the administration has stressed a use of a range of diplomatic tools available: multilateral diplomacy, support for the IAEA, financial measures, counter- proliferation action such as interdictions, and as a final resort, holds available the threat and use of military force.

The U.S. diplomatic strategy towards Iran consists of a dual- track approach, in concert together with the permanent five members of the U.N. Security Council, China, France, Russia, the United Kingdom, the United States, plus Germany -- the P-5-plus-1. These tracks are mutually reinforcing and complementary.

The first is the incremental escalation of pressure on the Iranian regime to help prompt a revision of their strategic nuclear calculus, specifically, a decision to abandon once and for all Iran's long-term nuclear weapons ambitions. The second track is an offer to negotiate a generous package of incentives that cover the gamut of political, economic, technological, and social benefits that would accrue to the Iranian people, we're (ph) the regime to resolve international concerns and its nuclear activities. As part of this offer, Secretary Rice announced on May 2006 that should Iran create the necessary conditions for negotiations by meeting its U.N. Security Council obligation to suspend all enrichment and reprocessing activities, the United States would be willing to meet with Iran any time, any place, to discuss any issue.

Ambassador Feltman will provide some introductory remarks addressing Iran's regional behavior in the U.S. civil engagement programs, but I'd like to discuss, a little bit, the nuclear front by noting that we seek to present Iran with an increasingly stark choice between two paths: confrontation and isolation, or cooperation and reward. While we believe we are having an impact, we have yet to achieve our objective of persuading Iran to step off its current nuclear course.

No one tool can succeed on its own. Iran's past behavior shows that it can be responsive to international pressure. This dual-track approach is our best tool for making clear to Iran the costs and benefits for its defiance, and dissuading (ph) the Iranian regime to take a different path.

At a minimum, these sanctions are limiting Iran's access to sensitive technologies and goods, with the possible impact of slowing Iran's nuclear and missile ambitions. These sanctions are also impairing their ability to access the international financial system to fund its weapons program and terrorist activities and to secure investment for its strategic sectors, as many states and firms (ph) no longer wish to associate themselves with the Iranian regime.

The sanctions keep Iran on the defensive, forcing it to find new finance and trade partners and replace funding channels it has lost, often through more costly and circuitous mechanisms. Major banks, such as Commerce Bank, Credit Suisse, and HSBC have decided that the risk of doing business in Iran is too great, and have ended or limited their relationships with Iran.

The effect of Iran's growing international stigma may, in the end, be as substantial as the direct economic impact of any sanction. Losing the ability for a single Iranian bank, such as Iran's Bank Sepah, to conduct business overseas is painful to the Iranian economy. Having major international financial institutions refuse to do business with Iran because of the legitimate business risks that such trade presents is even worse.

The sanctions are also having a psychological impact. Iran has demonstrated its desire to assume the economic and political role it believes it deserves in the region and to be seen as a legitimate player in the international community, but the series of U.N. resolutions has shown the world and Iran that it is isolated by the international community and will not be tolerated as an irresponsible actor.

In addition to sanctions, a key element of our strategy is to work with the International Atomic Energy Agency in its ongoing investigation of Iran. As the main international institution with responsibility for verifying the nondiversion (ph) of nuclear materials and providing credible assurance of the absence of undeclared nuclear activities, the IAEA's work in Iran is essential.

Press reports have indicated that many states are sharing more and more information with the IAEA to further its investigation. We look forward to the IAEA's continued efforts to uncover the true extent of Iran's nuclear weapons-related work and ambitions.

We'll continue to lead a strong international consensus that Iran must make a full disclosure of any nuclear weapons-related work and allow the IAEA to verify that it has stopped. Anything short of a demand for full disclosure would undermine not only our efforts to provide international verification that Iran is not developing or preserving a nuclear weapons option, but also would undermine the integrity of the IAEA safeguards regime worldwide.

Mr. Chairman, I'll yield to my colleague to address some of the regional aspects, and I look forward to your questions.

CARPER: I thank you, Ms. McNerney.

Mr. Feltman?

FELTMAN: Thank you, Chairman Carper, Dr. Coburn, Senator Coleman, for this opportunity to discuss U.S. policy options regarding Iran.

As Patty McNerney has described, we're taking many steps to address the challenges posed by Iran on the nuclear front. But we're also deeply, deeply concerned by Iran's overall behavior, both in terms of Iran's malign influence in the region, as well as Iran's oppression of its own people.

Iran poses multiple, multiple threats to U.S. interests, as your opening remarks have indicated. It destabilizes its neighbors, it is the world's number one state sponsor of terrorism, continues the oppression of Iranian civil society, and I add Iranian-funded militias, Iranian-funded weaponry are killing our troops and diplomats in Iraq.

I had the honor to serve as U.S. ambassador in Lebanon for three and a half years, and I saw every day the malign Iranian influence in Lebanon, in terms of Iran's support for Hezbollah. Hezbollah that, with Iranian support, dragged Lebanon into war with Israel in 2006. Hezbollah, which continues to try to undermine legitimate institutions of the government of Lebanon and seeks to create a state within a state there.

Iran's Revolutionary Guard Corps, (inaudible), continues to bolster Hezbollah financially as well as rearm the group with rockets and other weapons, which are systematic violations of multiple U.N. Security Council resolutions. Iran also supports other terrorist groups, including certain Shia militant groups in Iraq, Palestinian Islamic Jihad, and Hamas. Further to the East, Iran seeks to destabilize the Karzai government in Afghanistan by sending lethal assistance to the Taliban, once Iran's enemy.

Through its malign influence, Tehran undermines the elected government of Iraq and endangers our soldiers and diplomats by providing lethal support to Iraqi militants. The president has made clear that Iran has a choice to make. It can choose to live in peace with its neighbors, enjoying strong economic and religious and cultural ties, or it can continue to arm, fund, and train illegal militant groups which are terrorizing the Iraqi people and in fact, turning them against Iran.

America would welcome a peaceful relationship between Iran and Iraq, but make no mistake: The United States will act to protect its interests, our troops, and our Iraqi partners.

In terms of the nuclear file, Patty has already outlined our dual-track strategy towards Iran and our approach to the challenges posed by Iran's pursuit of nuclear capabilities. But let me emphasize that the United States remains committed to finding a multilateral diplomatic solution to address the threat posed by Iran's proliferation-sensitive nuclear activities and its overall destabilizing influence in the region.

As Patty outlines, we're working closely with our P-5-plus-1 partners to both pressure the Iranian regime and offer incentives to revive, as you said, Chairman Carper, the cost-benefit analysis that Iran has. The P-5-plus-1 package of incentives covers the gamut of political, economic, technological, and social benefits, including active international cooperation to help Iran develop state-of-the-art civil, peaceful nuclear energy technology and obtain an assured nuclear fuel supply for a genuinely civilian nuclear energy program.

In addition to that offer, Senator (ph) Rice has said multiple times since May 2006 that should Iran create the necessary conditions for negotiations by suspending all proliferation-sensitive activities, including uranium enrichment, she personally would sit down with her Iranian counterpart any place, any time, to discuss any issue of interest to Tehran, to discuss all of the multiple issues that you addressed in your opening remarks, Senators.

You know, let's talk about human rights for a second. Iran's foreign and nuclear policies are only part of the challenge Iran poses to the world. The regimes record of human rights abuse remains abysmal, and has only grown worse over the years.

The regime regularly commits torture and other forms of inhumane treatment on its own people, and restricts the basic freedoms of expression, press, religion, and assembly in order to discourage political opposition. The regime has purged liberal university professors, threatened, imprisoned, and tortured dissidents, journalists, labor leaders, and women's rights activists. The regime also denies its people the freedom of expression in the press by cracking down on bloggers, closing independent newspapers, censoring Internet use, and blocking satellite dish ownership, all in an effort to control access to information.

Secretary Rice noted at Davos earlier this year that the United States has no desire to have a permanent enemy in Iran, even after 29 years of difficult history. We have no conflict with the Iranian people. An important component of our Iran strategy is to build bridges -- bridges directly to the Iranian people -- through official exchanges and civil society development programs.

We have grave problems with Tehran on a range of issues, but we have the greatest respect for the citizens of Iran, their culture, and their rich heritage. Through official professional, educational, and cultural, and athletic exchanges, we are attempting to strengthen mutual understanding of our two peoples. Additionally, we are trying to provide the Iranian people with a better understanding of American foreign policy, our society, and our culture through our Persian- language television radio broadcasting on Voice of America and Radio Farda, as well as through the Internet and other media.

The United States stands with the Iranian people in their struggle to advance democracy, freedom, and basic civil rights of all citizens.

In closing, I note that we have presented Iran an option. The regime can continue down its current path toward isolation and further sanctions, or it can choose to reengage with the international community, opening up opportunities for better relations and a brighter future.

Should Iran comply with its U.N. Security Council obligations to suspend all proliferation-sensitive nuclear activities including enrichment, and cooperate with the IAEA, the secretary has said, and I quote, "We could begin negotiation and we could work over time to build new, more normal relationship -- one defined not by fear and mistrust, but growing cooperation, expanding trade and exchange, and the peaceful management of our differences," end quote. The choice is Iran's.

The challenges posed by Iran are daunting, but we are confident that our current approach, working in concert with the international community on nuclear and other issues, will move us toward a peaceful resolution to the problems posed by Iran.

Thank you.

CARPER: Our thanks to both of your for your testimony, and for your service to our country.

I have a question -- I'm going to start off with a question to both of you, if I could. One of the underlying points of the NIE was that Iran responds to pressure and calculates the costs and the benefits of certain actions that we might take against them.

The idea is that Iran stopped work on designing a nuclear weapon because of the perceived cost internationally of pursuing such work. Two questions: First of all, has the administration done an assessment to determine the magnitude of economic pressure needed to dissuade the Iranian government from continuing to pursue all the unacceptable elements of its nuclear program, including enrichment?

MCNERNEY: You know, I think as we review that question, you know, partly you have to understand what the regime itself is willing to bear in order to continue pursuit of this nuclear path. We've seen some polling and sort of calculated that the Iranian people as a whole, believing that their program is for civil nuclear purposes, indicate that they would like to pursue the nuclear path. But when you ask them a different question, which is, "What cost are you willing to take for pursuit of that path?" the calculus starts to change and the public support starts to diminish, in terms of the support for what they believe to be a civil nuclear path.

So our goal is to start to have an impact to such a degree that you start to change that popular support for the path the regime is on. We believe we're starting to have that impact; we don't believe there's sufficient pressure yet in that direction.

Obviously we've been trying to do this in a multilateral way, so it's -- sometimes working through the U.N. is a little more painful and a little slower, but over time it's sort of the accumulation of these impacts. And as I mentioned in my testimony, the additional downstream impact of businesses themselves choosing to withhold investment and look elsewhere for their business are all ways that we're looking to sort of increase that pressure and change that calculus. We want to impact the regime in a way that makes them sort of look at -- not have the available options on their side.

One of the things too, looking back to the 2003 decision, it wasn't simply -- there were no sanctions at the time, but there was obviously a lot of activity happening in the region. So the mix of pressures, I think, is beyond simply the sanctions, but also the international scrutiny that was the time that the programs were revealed, the covert nature of these programs, obviously a build-up in Iraq in the region. And so there's this, really, I think, a broad set of tools and pressures that we want to bring to bear.

CARPER: Do you have any -- and this is for either of you -- do you have any idea of the level of pressure that we need to apply to these folks, the Iranians, in order to succeed in our goal of no nuclear weapon capability? We've had these three U.N. Security Council resolutions, we've imposed unilaterally additional sanctions of our own.

They appear to be having some effect. Unfortunately, since the promulgation of the NEI, it looks like some other countries -- particularly the Russians and the Chinese -- have decided that they need not be as stringent, I think, in adhering to pressure on the Iranians themselves.

MCNERNEY: I don't think we have -- there's no sort of magic, this is the amount that sort of just tips the balance. But I think if you actually look to the Libya situation, it actually took some 10- plus years to really get to that balance. We don't believe we have that kind of time in...

CARPER: I don't believe we do, either.

MCNERNEY: And so the question is, how do you quicker? And, you know, obviously the high price of oil has really helped this regime weather some of these sanctions in a way that they might not have otherwise...

CARPER: I'm told that their ability to pump oil drops each year by about 500,000 barrels, and meanwhile their consumption of oil continues to rise.

MCNERNEY: But the price that they get for what they do pump continues to rise as well, so...

Some of the other sort of things that work in our favor on that are, the actual economic management of this leadership is particularly weak, so that does also exacerbate some of the sanctions as well. But again, I don't know that we know what is that magic number, or amount of, sort of, economic isolation.

CARPER: Mr. Feltman?

FELTMAN: I would echo what my colleague has said. We don't know exactly at what point that cost-benefit analysis will start turning -- the cost-benefit analysis that you referred to in your opening remarks, Mr. Chairman.

But we are going to continue to pursue this dual track multilaterally, that we will look at how we ourselves can impose unilateral pressure in a variety of ways on Iran, and we will work through the P-5-plus-1, through the IAEA, to see how we can impose international pressure. The Security Council resolutions -- the three Chapter 7 Security Council resolutions -- have had an increasing number of sanctions and punishments and penalties on Iran, and I don't believe we've seen the full impact of those yet.

CARPER: When are we likely to?

FELTMAN: Right now, we ourselves are bringing our own system into compliance with the most recent resolution; the European Union is doing the same in adopting 1803 into their common policy. The European Union is looking at making some autonomous sanctions beyond 1803; we're doing the same.

We're doing this all in coordination multilaterally, because I think all of us recognize that the danger is multilateral, and the sanctions also have to be multilateral to have the sort of impact. But we don't know the exact point where the cost-benefit analysis will start switching in the way we want.

CARPER: Ms. McNerney, Libya is a lot smaller, as we know, than Iran, and it doesn't have the oil reserves that Iran enjoys. So if it took Libya -- what did you say, seven to 10 years? -- in order to, if you will, to change their course, according to your calculation, how long do you think it's going to take for the Iranians to change their course? And do we have the luxury of waiting that long?

MCNERNEY: The point I was making was just that sometimes over time these pressures build. I don't think we have that kind of luxury.

But I also think that Libya was a little different in the sense of, perhaps, relishing that isolation in a different way than -- the Iranian country, as a country, the people are very, certainly, used to traveling globally, used to visiting Europe, used to a very different kind of life, I think, than perhaps you'd compare to the Libyan people, and certainly a more robust kind of society. So, you know, there are some differences, and I think the original -- one of the values of the Security Council process is not only the economic sanctions, but the fact that the entire Security Council unanimously continues to line up against the Iranian pursuit of nuclear weapons capabilities. So all these things, we believe, can have a larger and more direct impact on the civil society kind of impact.

CARPER: All right.

Dr. Coburn?

Thank you.

COBURN: Thank you for your testimony.

I'm concerned about the timeframe that Senator Carper mentioned, and you mentioned, Secretary McNerney, further sanctions may be needed. How do we know when further sanctions are needed? And why wouldn't we put the full press of all the sanctions that we can now?

You have in the press and stated by the president of that country that they're adding 6,000 centrifuges right now. They intend to go to 50,000 centrifuges.

And the question is, is there a real nuclear need for power in that country when they have the world's second largest reserves of natural gas? They can generate power for 500 years, if they needed to.

So the question is, if there are further sanctions that are needed, then I have some concern that Secretary Rice has signaled that no further sanctions are going to be brought before the U.N. in the near term. Where's the balance there?

MCNERNEY: Well, I think her statement was just to suggest that we're not going to move away from the policy that we're following. We do intend to continue working on the U.N. security track, including additional sanctions. At the same time, we're also trying to renegotiate this package of incentives, and Dan Fried led meetings in China last week, and they're continuing to work among the P-5-plus-1 to redevelop or refresh that package of incentives.

Additionally, you know, the United States obviously has had a complete embargo on Iran for many years. What we've been trying to do with this strategy is really broaden that, especially to our European allies as well as some of the key Asian economic powers.

And that, we believe, is where we need to continue to ratchet the pressure. Thus, the importance, really, of maintaining this U.N. Security Council track to increase, you know -- many of those countries are much more comfortable doing these sanctions with the U.N. Security Council mandates. Now, when we work with them, you know, you use that as a starting point, but it also is an opportunity to expand beyond the strict requirements of those Security Council resolutions.

So when the E.U. reviews its sanctions package in the coming weeks, they intend to go beyond sort of the strict requirements of that Security Council, and we believe that's an important avenue as well. So we don't want to simply suggest that that U.N. track is the only way to do sanctions, but...

COBURN: Should we believe the president of Iran when he's saying there are not any incentives that they would ever accept?

(CROSSTALK)

MCNERNEY: You know, I mean, when it comes from him I don't want to pretend to know what he's thinking or, you know, I think that...

COBURN: Well, I mean, it's a fairly straightforward statement: There are no incentives you can offer us to stop us from our nuclear enrichment program.

MCNERNEY: Well, I think they've made statements in the past that they won't do things, but then if you sort of look at, sort of, how things have evolved, they weren't going to talk to the IAEA about nuclear issues; they did announce this week that they will, in fact, be doing that next month. Now, whether they do that in any real way or in any substantive way, that remains to be seen.

But, you know, some of these statements certainly can be posturing. I do think, as I mentioned before, that the Iranian people actually can put pressure on their leadership in ways maybe, in a country like in North Korea, would certainly not even be an element.

COBURN: There's no question it's difficult to get consensus on P-5-plus-1. You know, it's been obvious it's been a hard road to get there. What if you can't get consensus for the next step?

What are we doing in terms of building relationships for containment, given the ultimate plan, which most of our leaders think is nuclearization of Iran? What are we doing in terms of building containment?

MCNERNEY: You know, the U.N. path and the P-5-plus-1 is one element. We reach out regularly through dialogues and through our embassies to countries, particularly in the Gulf region, to countries in Asia, to Japan and Korea and China, obviously even to our -- you know, I don't -- Russia's obviously difficult in the Security Council context, but they, every step of the way, also have agreed with this policy, that we need enrichment and reprocessing to stop in Iran, and that there is a threat posed by Iran to international peace and security.

So, you know, whether the P-5-plus-1 -- that's one element of our strategy, but certainly, you know, part of containment is maintaining a coalition, and that is a key element of what we're doing. The Russian -- it was mentioned earlier -- the Russian plan for an enrichment and reprocessing facility in Russia, we think that -- that's part of the P-5-plus-1 package, and remains, we think, a viable avenue for allowing Iran to get the benefit of nuclear energy without the know-how that can bleed into the nuclear weapons capability.

COBURN: In 2007, the State Department gave half of the 2007 Iran democracy promotion funding to the Broadcasting Board of Governors. Much of this money was diverted from democracy promotion to general infrastructure -- half of it, as a matter of fact. The BBG also claims its mission is not to promote democracy, but to balance news between the U.S. perspective and regime for propaganda.

Farsi-speaking BBG whistleblowers in a 2006 National Security Council report said the BBG many times fails to balance the regime's propaganda with the truth. In light of this, does the State Department plan to divert any of the 2008 Iran democracy funding to the BBG?

FELTMAN: Dr. Coburn, the short answer to your question is yes; but I'd like to talk a minute about the broadcasting part of the overall strategy, because the broadcasting part has two goals. One is to be able to allow us to send messages directly to the Iranian people -- not through the filter of their government, not through the filter of their state-controlled media. The second is to provide an example of what would a free media look like?

If they weren't living in this oppressive regime -- under this dictatorship, under this crazy autocratic regime -- what would a free media look like? And a free media has a wide variety of views expressed in it.

Now, at the same time we have discussed the issue that you allude to with the Voice of America, with America Radio Farda, and Broadcasting Board of Governors officials. You know there's new leadership now, there's new management. They're changing personnel, they're looking at the content, they're addressing some of the concerns that you've raised, that we have raised.

But the important this is, I believe, is that we have now increased the broadcasting to Iran. Voice of America is not 24 hours a day, up from eight hours a day. The original Persian-language...

COBURN: What's the content in Voice of America broadcasts?

FELTMAN: The content is now -- there's original content that's not up to six hours a day that was only two hours a day. It's news, it's...

COBURN: How do we know what it is? How do we know what it is?

FELTMAN: We have a constant discussion with the new leadership of VOA, with the BBG, about the content...

COBURN: They have nobody on the board and nobody in the leadership that speaks Farsi. They have no idea what they're broadcasting, because we can't get translation from the State Department about what they're broadcasting.

We don't know what they're doing, and we know what they have done. And it's not about a balance, it's about giving an -- oftentimes, many instances, where we give credence to what their own government is saying, in an unbalanced fashion.

And so the only way to see if we get that is to have translation services of what we're promoting. If we're going to use the people of Iran as a tool for freedom, then we ought to know what we're saying.

And we have an absolute refusal to present to this Congress and the American people what we're broadcasting into Iran. And based on the track record of the 2006 report, plus the track record of whistleblowers, what we know is it's not what the secretary has suggested. It is oftentimes supportive of the regime.

And so the question has to be, if we're going to use that as a tool to help the Iranian people see what a free democracy is about, and have a true balanced point of view - - not one that supplants and supports the leadership of Iran -- we have to have transparency. And there is no transparency now, because nobody at BBG knows, because none of them speak Farsi.

How will we know? How do we know that we're effective in the tool that you want to use to promote freedom and liberties inside Iran through Voice of America and Radio Farda? How do we know?

FELTMAN: All I can say, Dr. Coburn, is that the secretary is using her position as an ex officio member on the BBG in order to have these sorts of conversations directly with the leadership -- the new leadership -- of VOA and Radio Florida about these issues. This is an important part of our strategy, and the secretary and those below the secretary are engaged with the BBG on this issue, on these issues.

COBURN: Well, it would just seem to me that if we're going to use that as a tool, that the State Department ought to know what we're saying -- we ought to know what we're saying -- to see if it's an effective tool. It's called a metric; and it's called transparency. And that's the only way you get accountability.

And quite frankly, based on what we've heard from whistleblowers inside Voice of America, inside BBG, is they don't know, and oftentimes the message isn't what we want to send. So the only way to do that is if you require transparency, then they're going to know that we're going to know what we're saying. To me, it's unconscionable we would use a tool and not know whether the tool's working, and not know whether it's an appropriate tool.

CARPER: Your time has expired. Let me just say for the record, and then I'm going to yield to -- Dr. Coburn and I have a different take on this issue. I think one of the important this is for -- if we want people in these countries to listen to what's being reported on the news, we have to provide fair and objective reporting. People in these countries don't listen to their own radio, their own media, because they don't believe it; they know it's propaganda. And one of the best ways to make sure they don't listen to our stuff is for them to be convinced that we're putting out propaganda as well.

Senator Coleman?

COLEMAN: Thank you, Mr. Chairman.

Just one addition to this discussion, and that is in terms of democracy funding. Iran also blocks access to the Internet. What we've seen in this country is, bloggers are a very effective force in getting at independent voices.

Are we focusing on the prospect opportunity to unleash the voices of the people in Iran through use of blogging and other things? Are there some technological things that we could be supporting with democracy funding?

FELTMAN: Senator, we do have an active blogging program that's part of our program. In fact, the -- and we have active Web sites.

We're using technology as best we can, and the number of hits we get is actually quite impressive, and I'm not a technological expert myself, but those that are tell me that they can trace back that most of the hits that we're getting -- something over 4 million hits last year -- are from Iran itself, on our Web site. So we are using the blogging tool.

COLEMAN: In addition to our own Web site, what I'm talking about is technological strategies that unleash the potential blogs in Iran itself. I know there's a capacity for Iranians to tap into that, so a further discussion. But I just -- we're talking about whose voice, the voice of the people of Iran is the voice that should be heard, and certainly that presents the opportunity.

Let me get back -- Ms. McNerney, you mentioned the Russians and the, you know, one of the concepts that this administration has talked about that the president has been supportive of is the Russian concept that we can go in there, and we can work with the Iranians, and in effect, kind of manage and oversee that their nuclear capacity is for civilians -- civil and not weaponizations means. My concern is with the Russians, and about Russian behavior.

And the problem we have right now is that on the one hand, it'd be one thing if that's all the Iranians were doing. But on the other hand, they're doing enrichment; they're doing delivery systems. And so we're talking about giving them, on one hand, opportunities to develop a nuclear capacity, and yet we know that they're not listening and not responding to IAEA requests, not responding to Security Council resolutions.

Let me just talk about the Russians for a second. It's been my understanding that the Russians continue to assist the Iranians in long-range missile program, and again, there are three parts to having a nuclear weapon: the enrichment, weaponization, and delivery. So the delivery part is a critical part.

And by the way, that would put a significant portion of NATO under the threat of Iran having a nuclear weapon. Have we certified that the Russians have ended their support of the Iranian long-range missile program?

MCNERNEY: Without getting into, obviously, intelligence judgments, my understanding is that the part we're still concerned about with Russia is not in the ballistic side, but in the defensive missiles, like the SA-15 and things of that sort. We believe that Russia should not be selling any kind of weapon system to Iran, given the situation. They have continued to supply, however, these defensive kinds of missiles, which are below any threshold for the Security Council resolution list of conventional weapons.

So that is our area where we believe they continue to cooperate, but again, that would not be in the ballistic missile side.

COLEMAN: It seems to me that it's inconsistent to push for Russian civil -- American-Russian nuclear civil cooperation agreement, which I understand will be signed in several weeks. And I can tell you that I plan to send a letter from numerous colleagues to demonstrate there is real concern with Congress over this deal, and that it undermines our diplomacy with respect to Iran.

We've got the Russians who are -- whether it's below the level or not -- they're involved in developing Iranian missile programs. January, I think Moscow made a final shipment of nuclear (inaudible). So that will give the Iranians the capacity to produce enough near weapons-grade plutonium for roughly 60 nuclear weapons.

Russians have been involved in this assistance for a period of time. Russians have refused to limit conventional arms sales to Iran, something even the Clinton administration made a point of demanding as I recall -- I'm looking at my notes here -- in the 1990s as a condition of U.S.-Russian cooperation.

So now we have them selling advanced air defenses that could be deployed to defend Iranian's (ph) nuclear sites. Can you describe the logic for reversing the policies of the Clinton administration?

MCNERNEY: Well, the way we've looked at the civil nuclear agreement is in the context of working with Russia to create incentives not to go down the enrichment and reprocessing path, but rather, the proposal is that within Russian, you develop this enrichment and reprocessing capability. And when we look sort of globally at countries, there's a growing interest in nuclear with energy shortages and greenhouse gases.

Many countries around the world are beginning to look at nuclear energy. What we've been encouraging is, they do that in a way that doesn't create this enrichment and reprocessing technology.

And so Russia really is the key to having this ability to produce the fuel and also take back the spent fuel. And so the whole approach with Russia is to further that kind of approach and make it a contrast to Iran.

For example, we've reached some memorandums of understanding with UAE, (inaudible), Jordan, and it's all done with the explicit requirement that there not be enrichment and reprocessing capability developments. So we're getting the benefits of civil nuclear without some of these nonproliferation problems.

Similarly, the Russian relationship with Iran on Bushehr is not with the enrichment and reprocessing side, but simply with this light- water reactor technology, and the fuel -- and there is an agreement that there be IAEA safeguards and also take-back of the spent fuel. So all this in the context of creating, you know, the right way to do civil nuclear and receive the NPT promises, the benefits of civil nuclear, but also to limit or redirect some of the desire to have this enrichment and reprocessing capability.

COLEMAN: And I understand what the goal is. My concern is that you can't deal with that in this kind of abstract sense. So you've got the goal of saying, "If we could get a nuclear program with all the safeguards, that would be a very good thing, and if the Russians could take back the spent, that would be a very good thing," but at the same time you have the Iranians ignoring U.N. Security Council resolutions.

You have the Russians providing support for Iran when part of our efforts are to cut off Iran, not to do it unilaterally. This is a country that produces -- needs to import 40 percent of its gasoline; this is a country that needs hundreds of billion of dollars of investment to maintain its oil infrastructure. And we have the Swiss and Iranians doing a gas deal worth 18 billion euros, or 27 billion euros over a 25-year period.

So on the one had you have this laudable goal, but the circumstance at which it's being implemented causes a lot of concern. And so in the end it's very easy to move from -- dual-purpose -- to move from civilian to military purposes.

And I know my time is up, but I just want to reflect on something that my colleague, Senator Coburn, said early on. The fact is that if the Iranians get a nuclear weapon, the Saudis are going to buy one; the Egyptians are going to buy one. And we're going to live in a world in which I'm not going to sleep well at night, because we will have lost all ability to contain proliferation in very unstable areas.

And so it would just appear to me that those efforts, if we're really looking to put pressure on Iran economically, and a country that we believe is susceptible to that pressure, then we need to have a little more support from our quote, "allies," including the Russians. And the idea of us moving forward on a Russian-U.S. civilian civil nuclear arrangement, I think is counterproductive in light of the Russian relationship and trade and other things that they're doing with Iran.

MCNERNEY: Well, you know, I think the way we've looked at it, that actually this agreement creates more leverage for us to continue to put pressure on Russia to do it the right way. We have the Bush- Putin Initiative, where they talk about doing broader civil nuclear cooperation around the world, but with these nonproliferation, kind of, requirements and fencing around it.

The creation of this enrichment center in Russia would allow for less of the proliferation of that kind of technology. You know, it keeps me up at night as well to worry about Saudi and Egypt and others starting to go down the nuclear weapons path, so what we're trying to do is create a different way of approaching this so that Iran really is isolated as going down the wrong path, and that countries around the world instead are looking at a different way to get the benefits of nuclear energy.

You know, light-water reactor, obviously, still can be abused, but much, much less in terms of, sort of -- the problem with a lot of the enrichment and reprocessing capability that we worry about is, once you develop that knowledge, you can take it underground and take it out of the public eye, and our ability, from the intelligence standpoint, to detect that activity much more difficult when you're talking about some of these other paths to nuclear energy.

COLEMAN: Thank you, Mr. Chairman.

CARPER: I want to talk with you just a little bit about who calls these shots in Iran. I think I understand, for the most part, how government works in this country, although every now and then I get illuminated -- I didn't have it quite figured out.

But, they've recently had parliamentary elections over there, but instead of having like a multi-party system, it sounds like the -- it's almost like, if I could use an analogy, it's like we permitted elections for the Congress here, and only one party could run candidates, but only the extreme wing of that one party could run candidates, and nobody else could. And in spite of that kind of situation that they've gone through, where a lot of people who used to be maybe members of parliament weren't allowed to run, and folks who'd like to run were not allowed to run, unless you happen to be at one extreme end of the spectrum of their political thinking.

Those folks got to run, and some of them got elected, but apparently they're having a run-off here in the next week or two. What's going on?

FELTMAN: Mr. Chairman, the short answer of who's in charge, it is the supreme commander more than the president. In terms of the parliamentary elections, yes, parliamentary run-offs are tomorrow, in fact, for the seats that haven't yet been decided.

Iran went to extraordinary lengths this year in manipulating those parliamentary elections; even by Iranian standards they went to extraordinary lengths in disqualifying a record number of candidates, in manipulating the information that was available to the voters. They claim that there was a 65 percent turnout of votes. We estimate it was more like 50 percent, and those people who turned out wanted to make sure -- probably turned out in large part because they wanted to make sure that their voter registration card was stamped, because that stamp is important for university registration, for the equivalent of food stamps, things like that.

Basically, the system went to extraordinary lengths to manipulate the parliamentary elections to produce the result that you said, which is that the parliament is in control of the extremist wing of one party there. One wonders why they had to go to that -- the analysis that's interesting is, why did they go to that extreme this year?

You know, is there a sense of desperation? Is there something happening inside that we need to know, that we need to be evaluating? We don't have, you know, a diplomatic embassy in Tehran for all the reasons we know, so we don't have some of the normal diplomatic tools to look at Iranian society. So the analysis is still out, and we'll see how these run-offs go.

But I think you've seen a shift in who runs the country, away from the sort of traditional clerics who ran it with the onslaught of the revolution 30 years ago to much more of the sort of Revolutionary Guard type force. There are more and more people who are coming out of the Iran Revolutionary Guard in positions of influences. This is not a healthy development; this is not a good development.

The Revolutionary Guards are not just some rogue criminal element that's carrying out terrorism to the Quds Force outside of Iran; they're part of the system inside. The IRGC is doing economic projects, they're controlling the black market, they're expanding the Tehran metro, they're mentioned in the constitution of the Islamic Republic. But the Revolutionary Guard, and the Quds Force as one of the five pillars of the Revolutionary Guard, seem to be playing an ever more prominent role in reporting directly to the supreme commander.

CARPER: Do we have a pipeline to the supreme commander -- direct or indirect?

FELTMAN: No. Our channel, our official channel to the Iranians is via the Swiss. We've used the Swiss for almost 30 years now to convey information.

Much of what we use the Swiss for is consular-related. There are many American citizens who are either living in Iran or have connections with Iran, and so we use the Swiss for our official communications.

On the subject, though, of talks and of communication, I think it's worth looking at the example of where we do have an official means of communication, and that's in Iraq. There are trilateral talks in Iraq that we are doing at the request of the Iraqi government. The Iraqi government asked us to go into these talks; we made the decision to say yes in order to help support the Iraqi government.

So there's a history of direct communication with the Iranians via these trilateral talks. There have been three sessions since April of last year: two chaired at the ambassador level, one was chaired on our side by the political military counselor in Baghdad, Ambassador Marcie Ries.

And frankly, I think that it was clear from the testimony given by General Petraeus and Ambassador Crocker a few weeks ago up here that it hasn't been a real encouraging example of the sort of talk that many people would like to see us engage in, because we've had these three things, and the Iranians, at the same time, have continued to supply -- fund -- the special groups that are basically killing our troops, killing our diplomats, firing into the international zone, and trying to destabilize the Iraqi government. So the one area where we do have direct talks with the Iranians, which is the tripartite talks in Baghdad, has not been an encouraging example.

CARPER: All right. Let me ask, in the testimony of one of our other witnesses, they talked about what the mullahs fear. And one of the things that the mullahs fear is the economic destabilization, the deterioration of the economy, where people's earning power and standard of living continues to deteriorate. Rather than Ahmadinejad being able to deliver on his campaign promises, actually things are getting worse, not better, and one of the other witnesses says that's something that they fear.

My thought is, how do we make that even worse for them? Not that we have it in for the Iranian people; I sure have a lot of affection for them, and I think if they were able to actually vote for their parliament and vote for the leaders, we'd probably have a pretty good relationship with those folks. But how do we ratchet up the economic pressure?

And one of the ways, it seems to me, to ratchet up the economic pressure is, it's not just enough for us to put into place our unilateral sanctions, which we've done, which we're doing. It's not just enough for us to work with the Brits and the Germans and the French and others -- hopefully the Russians and the Chinese -- but there are too many leaks in this sanction; there's too much give in it. And we have to be able to make it tighter if we're going to have any success here.

One of the thoughts that comes to mind for me is, as much as I admire what Secretary Rice has said -- stop enriching your uranium, your fissile materials; we'll meet you anywhere, anytime, talk about anything -- that's a pretty generous offer. It hasn't worked. It hasn't worked.

In the meantime, the Iranians are doing more bad stuff than they were before. If we were to say, "We'll meet you anytime, anywhere, to talk about anything," without preconditions, how does that strengthen our ability to go out and get the Russians to stand, really, shoulder to shoulder with us, to get the Chinese to stand shoulder to shoulder with us, and some of these other countries that are going around our back and continue to have activities with the Iranians that tend to take away the economic pressure that the mullahs apparently fear?

MCNERNEY: Well, you know, I think we made the same judgment that that is the fear. You saw the gas rationing and sort of the impact it had in terms of the uprising by people. We're looking at, sort of, figure out ways to obviously have these kind of economic impacts.

You know, one of the things that -- one of the, sort of, just sort of practical reasons why talking without them stopping enrichment and reprocessing is important is, if that activity continues while we're doing the talking, if you look at the North Korea example, for example, it was about four years before we got them to shut down Yongbyon. So four years of talking and four years of developing enrichment and reprocessing technology, it's pretty clear that they could -- potentially, according to the NIE -- have the capability and master that enrichment and reprocessing...

CARPER: That's a good point. Let me just interrupt you. Excuse me.

But whether it's four weeks or four months, certainly four years is unacceptable. But something has to happen during that period of time during which those open negotiations are being offered -- the invitation of those open negotiations are being extended.

And that is, the other countries that are not supporting the efforts of a number of us, and clamping down economically on the Iranians -- that has to kick in. That has to kick in at a much higher level than it's currently exhibiting...

MCNERNEY: Yes.

CARPER: ... and that has to happen a lot sooner than four years from now.

MCNERNEY: Well, and that was going to be my next point. If you look at how, internationally, they tend to react on terms of sanctions, when there seems to be some engagement, some softening, the ability to get countries to actually impose those sanctions will only diminish. We see that in the case of North Korea; we've seen that in other examples.

So this notion that somehow if we started talking we'd be able to increase the pressure that other countries would put on, I just don't think that's the way things tend to operate. And so, you know, again, I think what -- part of the practical reason for this condition is that we need that activity to stop so that we can talk and deal with these issues in as long or as short a time as we need without Iran basically using that process to in fact develop their capability.

CARPER: Thank very much.

Dr. Coburn?

COBURN: Thank you.

I'd like unanimous consent to put the NSC 2006 report on Radio Farda and Voice of America...

CARPER: Without objection.

COBURN: And with all deference to my good friend and chairman, I don't want us to have propaganda either; I want us to have the truth. So I'll spend one second on this and get off of BBG.

I'd like for you to answer, in written form, why the American people shouldn't have transcribed to them what is being broadcast into Iran, both from Radio Farda and Voice of America -- why the American people shouldn't know what we're saying, as a check. Transparency creates accountability.

And so, tell my why we should not do that. And I'll stop with that.

We're having some hearings today in other aspects of the Senate on the nuclear facility in Syria. And there's no question that there was involvement from a couple of countries on that -- one was Iran, and one was Korea.

What do we know about Iran's involvement in that facility -- that you can speak about at this hearing?

MCNERNEY: Senator, I think I'll have to defer to the experts to do it in these other briefings, and they'll be providing some of that information to all the committees. I don't think you'll find that there's an Iranian angle, except to the degree that it really highlights the destabilizing influence of these covert activities -- nuclear activities -- and the importance of really rallying international support to put the pressure on Iran to stop its ability.

Because as I said, once they develop this enrichment and reprocessing technology, unlike the plutonium-based example you'll be hearing about, the enrichment and reprocessing effort can quickly go underground and be almost undetectable.

COBURN: But does it say anything about proliferation? We've been spending all this time talking with North Korea, and at the same time they're building a nuclear facility in Syria, and the fact that we're going to a point where we have limited verification.

MCNERNEY: I think it really speaks to the significant challenges. You know, obviously we've been very cautious in promising good results from North Korea, given the record and what we saw in the '90s and their ability to talk to us and do one thing, and then obviously quietly be also engaged in a enrichment and reprocessing program.

One of the key elements that we're talking about now in the next phases is verification, and, you know, having North Korea come clean, and actually open up, declare its facilities and open them up will be a key challenge of that next process. I don't want to pretend that I would guarantee that North Korea's being completely honest with us, because I think their record says otherwise.

COBURN: Do we have any knowledge that during all this discussion that this was initiated in Syria at the same time they were negotiating with us about nonproliferation?

MCNERNEY: I think we'll just have to defer to the other briefings for now.

COBURN: OK. All right.

I want to go back a little bit, where Senator Coleman was, in terms of the proliferation to Iran in terms of nuclear material. If we kind of look the other way with Russia on this one aspect, does it not send the wrong signal to other people that might be helping Iran proliferate? In other words, basically they're sending the material in there, but they're on our team, and we're saying OK, there's no consequences to that that we can actually do something about right now.

MCNERNEY: Well, one of the things -- their activities are allowable under the U.N. Security Council resolutions. What is not allowable is cooperation on enrichment and reprocessing in the heavy water reactor.

And so, you know, obviously we would prefer no cooperation with Iran, but at the same time it can be a counterexample of civil nuclear light-water reactor versus these real concerning proliferations...

COBURN: So the question comes, it's not allowable by U.S. law either. So does the United Nations' sanctions trump U.S. law?

MCNERNEY: Well, I think it...

COBURN: It is not allowable under U.S. law, now, to promote and ship enriched uranium to Iran.

MCNERNEY: Oh, certainly. Are you talking about the fuel for the...

COBURN: Yes.

MCNERNEY: But that's low enriched uranium, versus the highly enriched.

COBURN: I understand, but they're building the capability to build highly enriched.

MCNERNEY: That's through the enrichment reprocessing, which are separate, obviously, nuclear pathways.

COBURN: There's no question it's difficult to bring everybody together with a common purpose. My final question is, what is your hope -- you and Ambassador Feltman -- as you look at where we are today and where we're going? What is your hope?

Two years from now, a year and a half from now, what do you see in terms of the sanctions, the ongoing process? Where do you think we're going to be?

MCNERNEY: I guess I'd look at a couple places. I would hope that we could continue to build increasing support within Europe, within Asia, within the Gulf countries and other Middle East countries, to continue to really apply these resolutions, not only strictly, but also the spirit of the resolutions, which is to hold Iran accountable for violating its Security Council obligations.

The other, obviously, in terms of Iran, we hope that they will realize that this is a path that is going to continue. The isolation will only increase, and we need to find a way to start talking about this under a baseline that not only the United States, but the entire international community has laid out for them, which is to stop enrichment and reprocessing activities.

And so with that, you know, obviously, then you can have a fulsome conversation because you don't have these nuclear activities continuing. But, you know, I think Ambassador Feltman will talk about this a little more, but obviously that's just one aspect. Their shipping arms to the Taliban, to Iraqi insurgents, their destabilizing influence through Hamas and other organizations, again, all of that is important to a broader dialogue.

COBURN: Ambassador Feltman?

FELTMAN: I won't touch on the nuclear side, because I'll let Patty's words stand for themselves, but our agenda with Iran is enormous. We want Iran to realize it is unacceptable to be killing or troops, our diplomats, to try and be destabilizing Iraq. We want Iran to realize that they must stop funding Hezbollah, Hamas, Palestinian Islamic Jihad; they must stop shipping arms to the Taliban.

The agenda is huge, and we are working unilaterally and multilaterally to try to change Iran's behavior across the board, not simply on the nuclear file. The nuclear file is the trigger for the possibility of direct talks on these things, following up on Secretary Rice's initiative from two years ago. But it's certainly not the only issue; it's not the only important issue.

Iraq is an interesting venue to watch right now, because there's some signs that perhaps the Shia Iraqis are disgusted with what Iran has done in funding Shia militias in Iraq. This is almost a parallel to the fact that the Sunnis are disgusted to see the sort of Sunni militia activity, and Iran must be noticing that there was a revulsion in Iraq against what the Iranians were doing in terms of providing arms.

COBURN: OK. Well, thank you.

CARPER: Thank you.

Senator Coleman?

COLEMAN: Thank you, Mr. Chairman.

I wanted to -- perhaps this is more a philosophical question -- one of the things that frustrates me, but I listened to some of the discussion about conversations with Iran, and I do believe that we need to kind of ramp up and be more aggressive. But my concern is this, that there's almost a sense that -- let me step back.

We often get criticized by some of our actions, for instance in the Middle East, by saying we don't understand the culture. We don't understand tribal culture. We don't understand what's going on, and we don't understand the forces that kind of hold things together in the Middle East.

And at the same time, we have folks who are saying, "Well, if we just sat down and had a conversation, didn't have any preconditions and just kind of walked in there, that somehow we could make this better." And to me, I think there's a conflict there.

The fact is that not everyone proceeds with Western thought that flowed from, you know, the Enlightenment, Rousseau, you know, to get to where we are today, and kind of analyzes things the same way. I would suggest from my certainly more limited knowledge than the witnesses and others, but strength is something that is measured in the Middle East. And weakness has great consequences; perception of weakness has consequences.

I'm going to say this: President Carter's conversation with Hamas -- I'm shocked by it. I think Hamas is a terrorist force, committed to the destruction of Israel, that has killed Americans, and I think it sends a signal. One gives legitimacy and kind of a sense -- almost a sense of weakness that I think we pay a price for.

And so I guess my question would be -- (inaudible), you said a number of times, it's unacceptable to keep killing our troops. Iran is killing our troops. They're supplying weaponry, they're killing American soldiers.

And I guess my question -- we've asked a rhetorical question -- if we were to simply walk in and say, we're going to sit down and, without any preconditions, including a precondition to stop killing our soldiers -- if you want to expand economic opportunity, if we want to work out a resolution to this very complex issue of nuclearization with understanding the consequences of failure to resolve it, stop killing our soldiers, stop having Quds Force supply advanced weaponry to terrorists, and by the way, may be while you're at it, you know, put a little hold on Hezbollah, and sending rockets into Sderot, and maybe step back a little bit on Hamas and have a little civility in the Palestinian areas -- President Abbas is in town today; he's being undermined by Hamas; he's being undermined by Iran.

And so Iran is -- we actually have this unique opportunity in the Middle East now that you have all, many other Arab nations looking at Iran as the enemy; not the Jews, not Israel, not the United States, but Iran. And so my question is, if we were simply to walk forward -- the question the chairman raised earlier -- into discussion without precondition, the most significant to be being, "Stop killing our troops," would that perceived by the Saudis, the Egyptians, and others as a lack of strength, and would that have the potential to undermine some of the influence and stability that we're seeking in the region?

FELTMAN: Senator, you address this in a sort of philosophical way, and I'll say that when we hear the discussions about talking to Iran, it isn't, at one level, a philosophical issue. Some say that we should be talking without preconditions; we should simply try it. What do we have to lose?

Others will say, "My gosh, the conditions you've put on suspension of enrichment and proliferation-sensitive activities isn't sufficient, given everything else that's going on. We need to have more conditions, not less conditions." So it is a philosophical question.

But if there's ever a decision to talk to the Iranians, even if the Iranians would meet the secretary's requirement, there needs to be a serious conversation with the Gulf Arabs and other allies so that they understand what it is that we're doing. You mentioned this in your opening remarks, and I couldn't agree more.

Again, having served in Lebanon for three and a half years, I can guess how the Lebanese would see it, perhaps better than I can guess how the Gulf Arabs would see it. But they would want to understand what it is we're doing, why we're doing it, and that we're doing it from a position of strength, that we're not doing it from a position of weakness.

If we're talking philosophically, I have to ask myself, just based on my limited knowledge of what happens in Iran, do the Iranians really want to talk to us at the leadership level? Because if they did want to talk to us, I would think that they would be sending us different signals that would be unmistakable.

Regarding the tripartite talks in Baghdad that I mentioned earlier, if they wanted us to see that talking actually worked, you'd think that they would stop shipping arms, stop funding the Shia militias that are attacking us in Iraq. You're probably aware of the American citizen that disappeared on Kish Island a bit more than a year ago, in March of last year. I met with his wife and other family members on March 6 about the one-year anniversary of his disappearance.

We have sent numerous notes via the Swiss, numerous messages, about, help investigate, help find what happened to this guy in Iran. We don't find the answers, or the lack of answers, to be credible from Iran.

There are signals Iran could be sending us if, in fact, they were interested in talking to us. And I'm expressing my personal view, from looking at the information.

Our policy is, the secretary's offer remains valid. If they suspend enrichment and proliferation-sensitive activities -- which is an international obligation, it's not simply a U.S. condition, it's an international obligation on Iran -- we are willing to talk. But if we get to that point, I agree with you 100 percent, we need to have a serious talk with our Gulf partners and others, and we need to be talking from a position of strength.

COLEMAN: Thank you, Mr. Chairman.

CARPER: It's been illuminating, and I much appreciate it. We appreciate you being here today, the service you've provided for our country, your responses to our questions. And there may be some follow-up questions that we'll ask for the record and others that are not here, and we appreciate your prompt responses to those questions.

FELTMAN: Thank you.

MCNERNEY: Thank you.

CARPER: Thank you very much.

FELTMAN: Thank you, Mr. Chairman.

CARPER: And now we'd welcome the second panel. I'm going to go ahead and ask our panelists to take their seats, and I'm going to begin introduction of each of them while they do that.

Ambassador Dennis Ross is the Washington Institute's counselor and Ziegler distinguished fellow. Ambassador Ross played a leading role in shaping U.S. involvement in the Middle East peace process.

He was the U.S. point man on the peace process in both the administration of George Herbert Walker Bush and President Clinton, where he was awarded the highest State Department honor. He was instrumental in helping the Israelis and Palestinians reach the 1995 Interim Agreement, brokered the 1997 Hebron Accord successfully, and participated in the 1994 Israel-Jordan peace treaty.

Stephen Rademaker -- did I pronounce that name correctly?

RADEMAKER: Rademaker.

CARPER: Rademaker, thank you, joined Barbour, Griffith and Rogers -- that Barbour, is that Haley Barbour? Governor Barbour?

RADEMAKER: He was one of the founders...

CARPER: All right. Fair enough.

RADEMAKER: ... he has another job.

CARPER: He has a day job, now, doesn't he? Mr. Rademaker joined Barbour, Griffith and Rogers in January 2007. He previously served, I understand, as assistant secretary of state for the Bureau of Arms Control and the Bureau of International Security and Nonproliferation, where he directed nonproliferation policy for Iran and North Korea.

He also recently served as policy director for the National Security Affairs, and senior counsel for former secretary -- our colleague, former Senator Bill Frist, is that right? Good.

And rumor has it you may have spent some time in Delaware. Did you grow up in Delaware? Where'd you go to school -- high school?

RADEMAKER: Newark High School, Newark...

CARPER: Yellow jacket. Well, welcome. We're glad that you're here; it's not every day we have a Yellow jacket to come by and share some thoughts with us, so we're glad that you've come. Thank you for joining us.

Dr. Graham Allison is director of the Belfer Center for Science and International Affairs at Harvard University's John F. Kennedy School of Government, where he also served as dean. Dr. Allison previously served as special adviser to the secretary of defense under President Reagan, and as assistant secretary of defense for policy and plans under President Clinton.

He has been a member of the secretary of defense's defense policy board for Secretaries Weinberger, Carlucci, Cheney, Aspin, Perry and Cohen. His 1971 book, which I understand was your first, "Essence of Decision: Explaining the Cuban Missile Crisis," ranks among the bestsellers in political science in the 20th century. I don't know what you're going to do for an encore -- that's pretty impressive.

Dr. Jim Walsh, a research associate at Massachusetts Institute of Technology, where my son is a sophomore in mechanical engineering, so this is a home game for you.

(LAUGHTER)

He doesn't need my help. He doesn't need my help. He previously served as -- not my son, but Dr. Walsh -- previously served as director of Managing the Atom Project at the Belfer Center of Harvard's Kennedy School of Government, and he chaired Harvard's international group on radiological terrorism.

Dr. Walsh has traveled to Iran twice in the past six months for discussions with Iranian officials and analysts, and will return to Iran in June. He also participates in three Track Two projects that bring together former U.S. officials and experts, recurrent and former Iranian officials.

And Senator Collins has joined us.

Senator Collins, welcome. We're delighted that you're here. We're into our -- actually, this is officially our second panel, but actually it's number three. We were welcomed and led off by Senators Specter and Feinstein.

(CROSSTALK)

CARPER: Really, we're just delighted with the people that are here. This is a great panel as well. Would you like to make any brief statements before we go to the panel?

COLLINS: No, Mr. Chairman. I did have a very busy schedule today, including a classified briefing, which is why I'm late, but I actually think I've timed my arrival perfectly, because this panel has the expertise that I really want to hear. And I commend you for holding this hearing on such an important...

CARPER: We're delighted that you're -- thank you so much for joining us today.

COLLINS: Thank you.

CARPER: So, panel, I normally don't stick closely to the clock. We're going to start voting at 12:15. We've got a couple of votes in sequence; we want to get as much from you and back and forth in Q&A, so I'm going to ask you to try to stick fairly close to five minutes, and if you get much over I'll tap the gavel, OK?

Our friend Dennis Ross, welcome. We're delighted you're here, sir.

ROSS: Thank you, Mr. Chairman.

I've submitted testimony for the record. What I'm going to do is just offer a number of observations, in part based on the testimony, but also based on what I've heard you say earlier. And actually, I want to start off with a question that Dr. Coburn asked the last two panelists.

You asked them, what is it that they hope for in the next year or two? And I have to say, as someone who's been in administrations and had to testify in the past, oftentimes when you're up here you have to say what the administration line is. Obviously, we're free of that.

And I can say, given where we are, given the path we're on right now, next year Iran is going to be a nuclear power. The path we're on right now is one that's going to put them there.

Certainly it's quite possible that President Ahmadinejad is exaggerating in terms of where there are, in terms of being able to install the 6,000 new IR-2 centrifuges, which are five times as efficient as the 3,300 that are already there, but the fact is, you know, they're going to be in a position where they can begin to stockpile fissionable material, and the problem with what we heard from the administration witnesses: there is a mismatch between the character of the pressure that they're applying and the pace of the Iranian activities. So what we have to do is ask ourselves the question, where are we going to be, and how can we change the situation that unquestionably is about to unfold?

There are some people who look at the path that we're on right now and they say, "You know what? It's impossible to stop the Iranians. They're going to become not just a nuclear power, but a nuclear weapons state. And given that reality, the only thing we can do is let's focus on containment, let's focus on deterrence, and let's just live with it."

There are others who say, "Well, the problem is you have a regime that has messianic elements in it, and you heard Jeff Feltman say that the Revolutionary Guard is increasingly important in terms of the overall control in the system. True, they answer to the supreme leader, but the fact is, they're very heavily guided by a spirit that they have to spread the revolution, and by the way, they're the ones who control the nuclear program."

So others say, well this is not a group that can be deterred, and even if it's possible to prevent them from actually carrying out direct attacks, an Iran with nuclear weapons is going to cast such a shadow over the region, it's going to produce the Saudis and others going nuclear.

It'll be the end of the NPT. It'll embolden Hamas; it'll embolden Hezbollah; it'll change the landscape in the region. We really can't afford it. So, not only can we not live with it, we need to use military force to forestall it.

Those are two poles in the discussion. One basically says you can live with it; the other says you can't. And I would say that if each of those are going to produce outcomes that are not particularly acceptable, we ought to look for a third way.

And what I'm going to try to do here is suggest to you that there may be a set of diplomatic options that are worth pursuing as a third way, and even if they don't succeed, they put you in a better position to pursue one of those two other approaches more effectively than you might otherwise.

So let me start with what I will describe as a statecraft approach. Having written a book on statecraft, necessarily I tend to talk about things through that lens.

One critical element of statecraft is leverage, and the key here is recognizing that the Iranians actually do have vulnerabilities. It isn't wrong to be trying to put pressure on the Iranians; what's wrong is that we're not putting on pressure that's going to be effective.

They do have vulnerabilities that are economic and quite pronounced. Whether it's the fact that they have very high inflation right now, very high unemployment -- the price of oil, in fact, hasn't changed their economic vulnerabilities, although obviously it helps them, to some extent. The mullahs do want to preserve their power and their privilege; they do need to be able to buy off their publics, and that's why the use the revenues they generate from their oil exports.

The fact is, it's hard for them to continue to produce what they're doing in the oil area at a time -- and export what they've been exporting -- at a time when their own internal consumption is rising. The question is, can we squeeze them more effectively through economic means? My answer would be yes, I think we can, but only if, in fact, we come up with different ways to do so.

I'm not going to go through all this. Let me just sort of encapsulate the options in the following fashion: Option number one, again focused on their vulnerability, is tighten the noose. Now, that could be a good approach if you can persuade others to join with you. It's clear that the path we're on right now isn't getting others to do as much as they would need to to be able to affect the Iranians.

And I would also say, if you're focused only on the tighten the noose option, the problem is going to be, the Iranians may also feel this is an effort to not just humiliate them, but to defeat them. And if we're about regime change, then from their standpoint, better not to give in because the consequences are too high. Look at some of the speeches that both Ahmadinejad and the supreme leader have made, and you'll find that they focus heavily on, using their language, "If we concede to the arrogant powers, they'll never stop."

Option number two would be some of what we've heard today, which is engage the Iranians without any conditions. They have great suspicions, they have too much leverage, they still have cash to insulate them, at least for the time being, and the fact is, unless you go in an unconditioned way to them you can't get anywhere.

And put everything on the table. Everything. In a sense, a comprehensive approach where what you put on the table is responding to also some of their desires, which are, they want regime recognition, they want to know that they have a place in the region that's accepted, they want the economic boycotts to end, they want us to unfreeze the assets we've held since the time of the revolution, they want to be able to have civil nuclear power.

That's what they want. But for them to get that, then the counterpoint would be, "Well, you want to be accepted in the region, you want us to accept the regime as well, well you can't be engaged in terror. You can't be supporting Hamas and Hezbollah. You can't be opposing the idea of peace. You can't be declaring that Israel is not only illegitimate but is going to collapse imminently. And if you want civil nuclear power, then there has to be a kind of intrusiveness in terms of inspections to ensure you don't have a covert program, and you don't have a breakout capability."

In other words, a comprehensive approach puts everything they want on the table, but also everything we require in return. The problem I have with this option, I will tell you, is that, you know, I'm a veteran of negotiating in the Middle East. I know something about the mindsets.

Senator Coleman, you raised the issue of sort of culture and mindset when it comes to negotiations. I can tell you, in my experience what I have found with everybody I've negotiated with in the area is, when they were strong, they didn't feel the need to compromise; when they were weak, they felt they couldn't afford to compromise.

So the key here is, in the Iranian case, if you concede up front and there's no conditions and you're just going to engage them, my guess is that they're going to think, OK, we've now conceded to the fact that we're going to accept them being a nuclear weapons state, whatever we say. The negotiations are a process, but eventually we'll simply give in.

So that leads me to a third option. The third option is what I would call "engage the Iranians without conditions, but with pressure." They must not think that, in fact, we've already surrendered when we go to the table.

And so I would in effect say, marry option one and two. Marry the "tighten the noose" with the "engagement."

Now, one of the issues that I think one of you raised was, if we -- you know, the idea of talking -- if we talk, that will make it easier for others to do more in the sanctions area, and I think that one of the panelists before was saying, "Look, when we do that, you know, the fact is, others just go ahead and they think they really don't have to apply sanctions."

I would actually suggest a somewhat different approach. I would say our readiness to talk should be, in effect, with others' conditioned on them doing more. In other words, rather than focusing on the conditionality vis-a-vis the Iranians, you focus on the conditionality vis-a-vis others.

With the Europeans, say to them, "You know what? You want us to go to the table; you think there's a deal there. We might even be prepared to do that. We'd even be prepared to put a comprehensive proposal on the table along with you that goes beyond what's been put on the table so far, but the price is, you have to cut the economic lifeline before we go, so the Iranians know it. Cutting the economic lifeline means no more credit guarantees to your companies doing business there. No more, you know, you don't do any commerce; you don't do business with any of the Iranian banks."

With the Chinese, who frequently fill in whenever the Europeans cut back, we focus on, "Yes, we're willing to talk, but we have to do more than that." The Saudis have enormous financial clout, and if the Chinese had to choose between Iran and Saudi Arabia, they would choose Saudi Arabia. I mean, right now, just to put it in some perspective, the Saudis and the Chinese right now are -- I'll take one more minute? Thirty seconds.

CARPER: Thirty seconds.

ROSS: All right. Thirty seconds.

Just to put in perspective how you could use Saudi leverage if, in fact, you're going to have a comprehensive approach where you're trying to build the pressures even as you're prepared to talk, the Saudis right now are filling the Chinese strategic petroleum reserve with Saudi oil. The Chinese are investing enormously in the petrochemical industry in Saudi Arabia, and jointly, they are developing and investing in refineries around the world.

So if it's a choice between Saudi Arabia and Iran, China, given their mercantile mindset, they're going to choose Saudi Arabia. We have to have a strategy with the Saudis that makes them more likely to take these steps; they're not doing it right now.

So let me just wrap up by saying, you don't want to leave yourself with two unacceptable outcomes. Try a diplomatic approach, but if you're going to try that diplomatic approach, from my standpoint, talking makes sense, but you've got to have the talking take place in a context in which the Iranians don't think they're already won, and that they're under pressures. You concentrate the Iranian mind, even as you show them a pathway that says, "All right, there is a way out for you."

CARPER: Thank you very much for an excellent statement. Thank you.

Mr. Rademaker, welcome.

RADEMAKER: Thank you very much, Mr. Chairman. First let me say to you, Mr. Chairman, and to Dr. Coburn and Senator Coleman, I was very interested in your opening statements, and I thought you did -- all of you did an excellent job identifying the seriousness and intractability of the problem that we face with Iran. And Mr. Chairman, I think I agree with your observation that the basic challenge before us is identifying the least bad approach among the approaches that we have.

Broadly speaking, there are three alternatives before our country on Iran. One is to, essentially, accept that we are not going to stop Iran from achieving a nuclear weapons capability, and, you know, just plan for that eventuality.

The second is to decide that that is unacceptable and to use military force to prevent that eventuality from coming to pass. And then the third is to put together some sort of diplomatic approach to the problem that successfully keeps the Iranian nuclear threat under control, that persuades the Iranians to change their current course. And obviously among those three options, there's not question that a diplomatic solution that persuaded Iran to change course would be far and away the best.

And it's in that context that in my prepared remarks I spend a considerable amount of time explaining why the National Intelligence Estimate that came out last December was such a damaging development for not just U.S. foreign policy, and not just the Bush administration foreign policy, but really the foreign policy of the entire international community, particularly our European allies. And I was gratified to see that Ambassador Ross, in his prepared remarks, appears to agree fully with my assessment of the NIE and its implications, and the fundamental problem with the NIE.

The fundamental problem is not the intelligence conclusions; the fundamental problem is the way that those conclusions were expressed. They were expressed in a way that lent themselves to being misunderstood, misinterpreted, and thereby undercutting the prospect that the diplomatic efforts that we and our allies have been undertaking can succeed. And that is a most unfortunate development because, to the degree the prospects of successful diplomacy recede, prospects that we'll have to go with one of the other alternatives -- either accepting the Iranian nuclear weapons program or using military force -- the prospects of that, of one of those two alternatives having to be embraced increases.

One of the observations that I make in my prepared remarks that I'll repeat here is, with regard to the phrasing in the National Intelligence Estimate, I simply don't know which is worse, that the authors of that estimate did not appreciate the implications for the international diplomacy of the way they were expressing their conclusions, or that they fully appreciated those implications and were indifferent to them. I don't know which is worse, but I think it's a question that maybe someone in the United States Congress ought to start asking.

Now, I think one of the principal issues that is on the mind of everyone and has figured prominently in the hearing so far today is the question of whether we should drop the existing precondition to direct U.S. negotiation with Iran about the nuclear issue and engage the Iranians directly. I make two observations about that notion in my testimony.

The first is that if we are going to engage directly with Iran, we want out engagement to be successful. We want to be able to reach a negotiated outcome that is acceptable to us. In order to do that, we have to come into the negotiation from a position of strength.

The NIE guarantees that as of today, we are in a position of considerable weakness. The Iranians perceive us as weak; they perceive U.S. policy as collapsing. And I think to drop the existing precondition -- the precondition that's been in effect for many years -- will be seen by the Iranians as further U.S. concession, further evidence that the U.S. policy, the demands that the U.S. has been making up until now, are falling by the wayside, and that they are winning. In other words, to engage successfully diplomatically, I think we have to figure out a way to overcome the problems that were created for us by the NIE and engage from a position of strength.

Ambassador Ross, in his testimony, in his prepared statement, outlines an approach -- I think he agrees with what I'm saying about needing to negotiate from a position of strength -- he outlines a way that we could try to do so. I think it's an interesting approach to try and work with the Europeans in advance of negotiations.

I think I read in his testimony, though, that should such an effort to get the Europeans to join with us in imposing sanctions up front -- strengthening sanctions up front -- fail, should they not be prepared to agree to do that, I think what he's saying is -- I think he would agree with me -- that then it would not be right to drop the existing precondition. I don't want to put those words in his mouth, but...

CARPER: Let the record show that Ambassador Ross is nodding his head "yes."

(LAUGHTER)

RADEMAKER: The second point I make about direct negotiations with the Iranians is, we need to figure out what outcome we're prepared to accept. And here, I think the critical question is, are we prepared to accept enrichment in Iran or not? U.S. policy up until now, and the policy of our allies and the policy of the United Nations Security Council, as reflected in four binding resolutions, is, there should not be enrichment in Iran.

Dr. Walsh, in his prepared testimony, says that is unrealistic; we are not going to achieve that. And so, you know, we should stop demanding that, and in fact, we should develop a fallback proposal that we think the Iranians would accept.

I guess I'm not prepared, personally, to agree that the Security Council has it wrong, and our allies have it wrong, and we have it wrong, and we have to give the Iranians -- we have to move in the Iranian direction and allow them to enrich in Iran. I think that would be a dangerous development because yes, there might be enhanced safeguards, enhanced inspections, enhanced verification, but I think we would never have confidence with the current regime that if enrichment was taking place in Iran at declared locations that were under international supervision, that there wasn't a parallel covert program somewhere, using some of the same equipment, the same technology, and engaging in enrichment, producing fissile material without our being aware of it. I guess I don't have the same high level of confidence in the ability of international verification mechanisms to detect covert enrichment at undeclared sites that Dr. Walsh has.

Let me make one final observation, and then I'll finish. Dr. Walsh also, as part of his suggestion that we need to accept enrichment in Iran, says what we should do is talk to the Iranians, propose to the Iranians that they multilateralize or multinationalize the enrichment facility in Iran -- take the Natanz facility and bring in foreign partners.

As a former diplomat, I don't think I'd have a whole lot of trouble selling that idea to the Iranians; I think it's an idea that would sell itself. I would go to the Iranians and say, "Boy, do I have a deal for you. You're under international sanctions, you can't get the technology you need, you're a pariah because of what you're doing. Here's the bargain: We'll help you raise capital, we'll bring in foreign investors, they'll invest in your plant, they'll bring in expert managers to help you run it, they'll bring in foreign technology to overcome the technical problems you've been having, and best of all, you'll get international legitimacy. Your nuclear program will no longer be an outlaw nuclear program. All you've got to do is agree to some enhanced inspections and some foreign involvement in your program, and the future changes."

I think the Iranians would be foolish to reject such an offer. I guess the question I ask is, would we be foolish to offer it?

And let me make one further point about this idea that I think...

CARPER: I'm going to ask you to wrap it up, but go ahead. Finish your thought.

RADEMAKER: President Bush, in 2005, proposed that there be a global ban on transfer of enrichment and reprocessing technology in any country that doesn't currently have it, and he proposed that the Nuclear Suppliers Group adopt that as a policy. The NSG has not yet done that, but pending that, the G-8 every year since 2005 has, among the G-8 members, agreed that they will not transfer enrichment and reprocessing technology to any country that doesn't have it.

I don't understand how, if we are going to stand up a multinational enrichment facility in Iran, we don't undermine this notion that there shouldn't be transfers of that kind of technology to any country that doesn't have it. Because if it's a multinational facility, the foreign partners are going to fully expect to be able to bring in the technology for the project to succeed, and once Iran gets it, how can you justify denying that same sort of capability to others?

Thank you, Mr. Chairman.

CARPER: Mr. Rademaker, thank you very much.

And Dr. Allison, I think he set you up pretty well here for -- come right in and say your piece. You're recognized -- your full statement will be part of the record...

ALLISON: Thank you very much for your leadership in drilling down on what is certainly the central challenge to American national security going forward over the next several years. I think you introduce the conversation in just the right terms, recognizing that the choices at this point are between very bad and horrible. That's all the choices; there's not good choices.

I also agree very much with Dr. Coburn's earlier proposition that the challenge that Iran poses is not simply a challenge in itself. It's a challenge to the entire global nuclear order and the nonproliferation regime. And I address both of those in the testimony that I submit.

I also submit for you a case from the course that I teach at Harvard that I gave to my students a month ago, in which they had to play a RID (ph) team exercise as if they were working for the Iranian supreme leader, who wants three bombs by the end of 2009. If you're going to drill down on this, I suggest you look at the case, because you'll find it interesting.

It stretches the facts of the current situation to the very worst case. Getting three bombs by the end of '09 will be extremely ambitious for Iran, but just at the edge. And I think as one goes through this, one sees a lot about the strategy that we've been following and its consequences.

In my prepared testimony, I offered short answers to seven quick questions, but let me go through them quickly. First, is Iran seriously seeking nuclear weapons? Answer: Yes.

Two, is the Bush administration's strategy for the slow diplomatic squeeze that we heard presented today working? Answer: No.

Three, what has the Bush administration's approach achieved and not achieved at this point? I would say the diplomacy, and getting four Security Council resolutions, has been nothing short of extraordinary, but the fact is that Iran is seven years closer to its goal line than it was when the Bush administration came to office. So in one line, the Bush administration's efforts to organize diplomatic sanctions have essentially succeeded in giving Iran more time to advance nuclear facts on the ground.

Four, has the Bush administration's approach missed opportunities to stop Iran's program? Answer: Yes. The best opportunity we had was in the spring of '03. The exchanged piece of paper had a list of all the things to be negotiated -- that needed to be negotiated. We don't know whether we would have succeeded if negotiations had been entered, but we know that we failed to try.

Five, on the current track, when will Iran acquire its first nuclear bombs? Answer: The NIE offers the consensus judgment, not before the end of '09, and even that, unlikely. Most likely out to the 2010, 2015 range. So I wouldn't disagree from that proposition, and I think as you go through the exercise of how Iran would actually seek and get a nuclear weapon -- the case that I gave you -- that becomes even more plausible.

Six, are there lessons -- you raised in the letter that you sent to us for the testimony -- from the wrestling match with North Korea, which is a topic of today, that provide relevant insights for dealing with Iran? And I think the answer is yes.

The results of the Bush-Cheney-Bolton strategy, as I characterize it, of threaten and neglect, or the quote from Vice President Cheney says, "We don't negotiate with evil, we defeat it," we can now look and see what results this produced. Kim Jong Il, eight additional nuclear bombs; Bush, zero.

(inaudible) this a strong statement, but here we are today: North Korea has eight nuclear bombs that it did not have -- with the plutonium -- in January 2001. I believe this is the largest and most dangerous failure in nonproliferation policy for the U.S. in recent decades.

He basically sat by while North Korea withdrew from the NPT, ejected the IAEA inspectors, shut down the 24/7 cameras that were watching six bombs-worth of plutonium, trucked the plutonium over to a reprocessing plant and reprocessed it, turned back on the Yongbyon reactor, and started producing another bomb or two a year, and then conducted a nuclear test. So all this has happened; these are simple facts.

In the aftermath of that, in what John Bolton has rightly called a flip-flop from the prior approach, the Bush-Hill-Rice current approach that's engaged the six-party talks and North Korea bilaterally has succeeded in at least closing down the Yongbyon reactor, and the benefit of that is not producing more enriched uranium. Has it done all the things that we need to do about every other subject? Absolutely not. Will it do? Absolutely not.

But is it better not to have one or two more North Korean bombs every year? I would say it's unseemly, it's tawdry, and it's better than the alternative.

Finally, are there relevant historical analogies that might offer some insight to this? I say in my testimony, and I have compared this earlier to something like a Cuban Missile Crisis in slow motion. I was in the most dangerous moment in history -- 1962, Soviets sneaking missiles into Cuba, Kennedy confronts them, demands for the missiles to be withdrawn, we go through 13 very tense days.

At the end of that exercise, Kennedy invented an option that he would not have considered at the beginning of the week, that many of his advisers, actually, wouldn't have agreed to, that succeeded in getting the missiles withdrawn without war. And I think it's only when we face up to the fact, as Dennis was saying before, that the two options at the end of this road are: acquiesce and attack. And as you analyze the consequences of each of those and see how unacceptable each are, that we'll finally get real in looking at options that are unpalatable, tawdry, ugly, but better than either of those two alternatives.

And I think the danger is that as we postpone this event, we let Iran create new facts on the ground all the time. So we, for a long time, said Iran would not be allowed to master the technology of enriching uranium, and I still here statements of that sort today. The answer is, "Excuse me, they have 75 kilos of low enriched uranium that they've already enriched."

So I would say their facts on the ground are moving all the time while we've been struggling, trying to figure out what kind of option we would actually pursue. So I subscribe to Dennis' proposition that we should, at this stage, be getting all of our carrots, all of our sticks, all of our allies into the discussion.

CARPER: Dr. Graham, thank you very, very much for that statement.

Dr. Walsh, you're recognized, please.

WALSH: Thank you, Mr. Chairman.

Thank you, Dr. Coburn, and Senator Coleman, and Senator Collins. It's a privilege to be back before this committee, and an honor to be with this distinguished panel.

My focus is going to be on the nuclear issue. That's my background, as the chairman alluded to. But I've also, through the course of my work, met over 100 Iranian officials from the Expediency Council, the foreign ministry, the Atomic Energy Organization of Iran, and I spent five hours with President Ahmadinejad and with North Korean officials as well.

After the hearing, I'm more than happy to respond to questions in writing, if you have additional questions, and I got up early this morning and wrote a brief memo on the recent revelations about the Syrian-North Korean connection and its implications for policy on Iran. I'm happy to share that if there's any interest in that.

But let me get to the task at hand. First, U.S. current policy. You've heard this morning U.S. policy is multifaceted, but as regards to the nuclear issue, really the core strategy is based on sanctions.

And I think sanctions have enjoyed some success. Some people said the U.S. would never be able to get any sanctions resolution through the United Nations, and they were able to do that.

I think in the big picture here, as my colleagues have said, this sanctions strategy is failing. Now, when I appeared before you two years ago, there were 164 centrifuges in Iran, and no sanctions. Ten days after I testified, you had the first resolution.

We've had three sanctions resolutions, and since that time that I testified, we now have 3,000 centrifuges. That's, I guess, about 1,000 centrifuges per sanction resolution, and they've announced that they're going to build 6,000 more. I mean, you know, I think on its face, this is clearly not working.

In the race between centrifuges and sanctions, the centrifuges are winning, and even senior U.S. officials concede that point. And I think it is unlikely to get better, and as the comments from the chairman and Dr. Coburn, I think, imply, what we have here is a disconnect.

Sanctions is a policy for the long term, to deal with long-term public policy problems. The nuclear issue, by contrast, is a near to intermediate-term. And so I think even at its best -- and there's a big debate whether sanctions are generally effective -- even at its best, we are dealing with a disconnect between policy instruments and policy problems.

Now, we have alternatives. In my testimony I talk about soft regime change and containment, but like sanctions, these do not work in a relevant timeframe. It's a policy mismatch. By the time soft regime change or containment and reassurance work, Iran will have already built thousands and thousands of centrifuges. They are post- nuclear approaches.

Not true of military action, but I think at best military action would simply delay, and at worst would create, a determined proliferator, and it would be prohibitively costly. Secretary Gates said just the other day, quote, "Another war in the Middle East is the last thing we need and would be disastrous on a number of levels."

So, the final option that people talk about is direct talks without precondition. And you have people who simply call for talks, and then you have others who also say they want a grand bargain. I think the first is too little and the second is too much.

We have to do more than simply have talks; we have to be able to have something to say when we talk to them. We have to have a proposal that will advance the process.

I think the grand bargain is too much. You'll remember that in 2003, the Iranians, through the offices of the Swiss, did propose at least a negotiation on what might be characterized as a grand bargain with the U.S., in which terrorism, the nuclear program, the Arab- Israeli dispute, were all on the table.

That proposal, alas, was not responded to, but I think under the current leadership and the current conditions, it's too much to as for a grand bargain. We can achieve progress in important areas like the nuclear issue without having to achieve progress on everything.

I would say that one of the things that we should think about when we ask the question, "What do we say to the Iranians?" is this proposal that my colleagues and I have put forth -- the multilateralizing and multinationalizing of Iran's fuel cycle. And while I appreciate Mr. Rademaker's interest in the proposal, I think I have a slightly different characterization of it.

I think the basic dilemma we face here is, U.S. policy is no centrifuges. And Iranian policy is, we're going to have enrichment on Iranian territory. And there seems to be not much room in between those two positions.

What we try to do is square that circle by saying there will be enrichment on Iranian territory, but it will not be a national program solely owned and controlled by Iranians. It will be internationally owned and managed.

There's a difference. The Iranians would participate, but the ownership, management, and operation of that facility, whatever its size and whatever its technology, which I do not prejudge, would be done not by Iran alone, which is what we're looking at here, but by Iran with others' eyes and ears on the ground.

I think that's better than the status quo. I think that's better than where we're headed. I believe in a reality-based policy, and right now we are not dealing with reality.

This proposal would call for upgraded inspections, eyes on the ground, greater transparency. Yes, there are risks. I review some of those risks in my written testimony, but I think they can be minimized.

And at the end of the day, it's compared to what? This compared to what? And the what looks pretty bad right now. So I think this proposal has a better chance of achieving our objectives in nonproliferation, specifically, than much of what's talked about.

In terms of lessons from North Korea in Iran -- and I will wrap up very briefly -- I think there are some lessons. The general lesson is, it's a mistake to assume inevitability, that it's destiny that a country will become a nuclear weapons state and will hold onto those weapons forever.

I think it shows that we can engage with countries we don't like, that allies are important but the U.S. has to engage in direct conversations with these people, and that the other guy has to get something out of it. Everything that's all restrictions and no benefits -- that's not an agreement that's going to happen or going to be sustainable.

With North Korea, I think the lesson is it's not enough simply to talk; we have to have something to say. And when you reach an impasse, it's more for more. You get more, but only if you do more. And that's how you transform the negotiations.

In Libya, as I say, I think the lesson is, it shows how sanctions work -- which are really a long-term proposition -- the importance of the U.S. following through on its promises, and that the IAEA has an important role to play here.

Let me conclude by saying that not only IAEA but Congress -- all of you -- have a critical role to play in your oversight, information collection -- this hearing is a great example what we need to have more of -- and as a policy innovator. I think you can develop legislative-to-legislative ties with Iran, if that opportunity arises, engage in smart engagement. Those sorts of things are detailed in the written testimony.

Let me end here by again thanking you for the opportunity to reappear before your committee.

CARPER: Dr. Walsh, thank you very, very much.

We're going to start voting, I'm told, about 12:15. Senator Coleman (ph) and I have probably about 20 minutes after that to get to the floor to actually start voting; we'll have a series of votes. He and I have discussed, and what we're going to do is, you know, I'll ask some questions and look for your responses, and then we'll probably be closing this down by 12:30.

And I understand, Dr. Allison, you have a plane to catch, and that works, I think, with your schedule.

Thank you for an excellent -- this is an excellent panel, an excellent presentation.

I want to go back to Ambassador Ross and just ask you, again, just briefly within 60 seconds, just outline your third-way proposal for us. And then we're going to ask each of our other three panelists to respond to that third-way suggestion.

ROSS: The essence of the third-way proposal is what I call "engagement without conditions, but with pressure." It's an amalgam of what I call those who say, "Let's only tighten the noose," and others who say, "Let's engage without any conditions at all."

And the essence of it is basically, use your readiness to talk as a device to get others, who have been holding back in terms of providing the real sanctions, to do much more than they've been willing to do. It's premised on several different assumptions.

Assumption number one: that the Europeans believe there is a deal that can be struck, but only if the U.S. is at the table, because what the Iranians want is not just the political and economic side of things, but they want certain things from us, especially as it relates to recognition, security, a place in the region. Assumption number two is that you have to bring the Chinese in, but we haven't been applying any leverage on the Chinese.

Now, our leverage on the Chinese can be applied in one of several ways. One is argumentation: Don't put us in a position where the only option left to prevent the Iranians from going nuclear is the use of force. A second way to deal with them is, in fact, to focus on what seems to motivate them in a pretty consistent way. They have what I call a mercantile mindset. There is enormous Saudi financial clout.

Find a way to bring the Saudis into this. The Saudis won't do what we want if we just ask them to do it, because they won't want to expose themselves to some potential risk unless they know what's our overall strategy and where do they fit into it. Use the Saudis as a way of affecting the Chinese.

Thirdly, I would also try to bring the Russians in. Now, there are multiple ways to try to bring the Russians in. I stated in the testimony, one is, they do have an interest -- I heard and Dr. Coburn agreed with what Senator Coleman was saying about the issue of nuclear cooperation with them -- they have enormous economic interests in this, and use that as a potential lever.

Also, the issue of missile defenses in eastern Europe. The rationale for the missile defenses in eastern Europe are a protection against the Iranians. This is a very big issue that Putin has made. Say to them, "Look, if you really join us," and we have to be very specific in terms of what it means, in terms of preventing Iran from being such a threat, "well then, we don't actually have to proceed with the missile defenses in Europe." That's the essence of it.

CARPER: OK. Thanks.

With that outline, again, Mr. Rademaker, why don't you just -- what do you like about it? What do you question about it?

RADEMAKER: To the degree that what Ambassador Ross is saying is that we shouldn't begin direct negotiations with Iran today, I fully agree with him. And I think the rationale that he has is the same as mine, which is, our position today, politically and diplomatically, is too weak to successfully negotiate with the Iranians.

So what this is is a suggestion about how we can strengthen our position in order to be able to, hopefully, negotiate successfully. I think it's a creative idea, and I think it would be worth pursuing, but I'll flag two concerns I have.

One, I think part of the idea is that the Europeans impose the sanctions before the negotiations and strengthen the pressure on the Iranians before the talks begin. The Europeans may well say no to that idea, and then we're back to the situation we're in today.

My second point is, if we're going to enter a joint negotiation of this sort, we are going to have to have an understanding with the Europeans about what it is we're seeking to achieve, what is the outcome that we want. And in particular, the issue that I flagged in my opening remarks, is the final outcome we're seeking one in which there is no enrichment in Iran, full stop, or is it one along the lines that Dr. Walsh has outlined where we say, OK, we're going to allow you to have enrichment under certain conditions? That's a critically important decision, but there has to be a meeting of the minds between us and the Europeans under this concept.

And I haven't heard Ambassador Ross' suggestion about what our bottom line should be. My view is clear, and I state it in my prepared remarks: I think our bottom line has to remain "no enrichment in Iran," because allowing enrichment in Iran would just be too dangerous, given the history and nature of their program.

And so if the Europeans came to us and said, "We will undertake this with you. We will even impose sanctions up front. But you have to join us in agreeing that we'll settle for some arrangement with Iran under which they are able to engage in enrichment in Iran," I would not think that's a bargain we would want to strike with the...

CARPER: Thank you, sir.

Dr. Allison, what do you like, what do you question about Ambassador Ross' proposal?

ALLISON: Dennis and I have talked about this one before. I like the general idea, but I think it's somewhat unrealistic in the short run.

I think in the first instance, as Steve has said rightly, the Bush administration doesn't know its own mind, so it doesn't have an agreement on what it would accept. If you don't have a notion of what is acceptable in the reality zone, that's one reason not to talk.

Two, it doesn't have an agreement with the other parties with respect to what would be acceptable. That would be extremely difficult to do, and in any case, the Bush administration can't do it between now and then.

Three, when is then? OK, a new administration comes with Senator McCain or one of the other senators. It takes six months or a year to get its act together. All the time, Iran is just there moving facts on the ground.

So the reality of the situation is, the facts on the ground are worsening constantly as we've done whatever we've done. So there we are.

I think with respect to where we want to get to is something like what Dennis is proposing -- a grand bargain negotiation. I outlined that in the 2004 book on nuclear terrorism, where basically we take all of the carrots to the table, and that, most importantly for the Iranians is some assurance that we're not going to attack them to change their regime by force, and that we're not going to support groups that are undermining them inside.

I'm in favor of being able to threaten that; I like very much the Israeli stick in the closet kind of looking out a little bit. So I think you need a lot of lot of sticks, you need a lot of lot of carrots, and then you need a covert (ph) position.

You need to sit down with the other parties as part of the game, and the U.S., though, has got to be the person doing the deal because it's the regime that the supreme leader thinks he's responsible for keeping in place, and it's the regime that we threatened, credibly, when first we announced there was an axis of evil and said that the solution to this problem is toppling the regimes, and then topple this neighbor next door in three weeks, when we had fought eight years to a standstill war with (ph).

So, that was the May of '03, when we had -- when our strength was at a maximum position. I think recovering a position of strength for such negotiations will be extremely difficult, but not impossible.

CARPER: All right. Thank you.

Last word. What do you like, what do you question about this...

WALSH: Well, I like the idea of using it as a device to get others to do more. You heard in the first panel, one of the witnesses said, "Well, if you start talking to the Iranians, our allies will do less." I think the historical record shows that to be absolutely wrong.

It was after Secretary Rice's announcement in May that we got the first sanctions resolution. So I do think it is a device to get people on board.

I do agree with Mr. Rademaker in this regard, that you have to be clear about the goal. Is it zero enrichment? What is it you're actually going for?

Again, I really doubt, for reasons of national pride and internal politics, and now bureaucratic politics, whether they're suddenly going to go from 3,000 or 9,000 or 10,000 to zero. I have grave doubts about that.

As for sanctions, I think that would be great; they're useful. But I think there's at tendency to overemphasize sanctions, as if it's a be all and end all, when actually the record is quite mixed.

Iran is a big country. For all the Gulf states that fear it, a lot of those Gulf states are investing in Iran, even with the international sanctions right now. And you run the risk of repeating the North Korea thing, which is, you're talking to them, then you impose sanctions, and then they pull out because they're either mad, or whatever, and then all of a (inaudible) begin to address it that they come back to the table.

But in general -- I know that sounds negative -- in general I'm positive about it, with just those observations.

CARPER: Fine. Thank you very, very much.

Dr. Coburn?

COBURN: How many of you all think that Iran desires to have a nuclear weapon?

(UNKNOWN): Elements.

COBURN: How many of you all realize, or would agree, that who we're talking to indirectly, now, isn't the people who are making the decisions? IRGC -- we're not talking to them, right?

(UNKNOWN): Supreme leader. That's (inaudible).

COBURN: They work for the supreme leader.

(UNKNOWN): Yes.

COBURN: They don't work for Ahmadinejad.

Comment on sanctions. There are sanctions, and then there are sanctions. We haven't had real sanctions yet.

Intriguing idea, Ambassador Ross.

The question is -- we're in a pickle, and the question becomes, how do we get out of the pickle? If we do what Ambassador Ross says, and it's related only to enrichment, instead of killing our troops, denying human rights in Iran, and all the other consequences, what happens if we fail?

What happens -- if you think they're going for a nuclear weapon, and we say we'll talk on the basis of the fact that we got enhanced sanctions, and the talking doesn't work, what happens?

WALSH: Well, I think, you know, these policies move in sequence, and the one thing you don't want to do is prejudge yourself so you miss an opportunity to resolve the problem, right? If we assume that they're bound and determined to get a nuclear weapon, which is not the finding of the NIE -- in fact, that's...

COBURN: But that's based on 2003 intelligence data. It's not based on the most recent revelations (ph) of what has been in the press about their accomplishment with Chinese drawings, molds...

WALSH: You know, I've always thought, when you look at the history of the Iranian nuclear weapons program, it started in the mid- 80s. We'll ignore the fact that the shah wanted it as well. The curious thing here is that they didn't make more progress than they did in the decades -- this has been a program that's been up and down and up and down.

And I think the key finding of the NIE, as I explained in my testimony, the key finding is not whether today they're working on weaponization or not; the key finding is whether they're a rational actor that under circumstances would be willing to give up their nuclear weapon or talk about it. And the answer on that is pretty clear.

If we presume they're going to get one no matter what, then if there is actually an opportunity to stop it, we will completely blow past that on our way to other policy...

COBURN: Is it your assumption they're a rational actor?

WALSH: Oh, definitely.

COBURN: Is it your assumption they're a rational actor?

ALLISON: I would say more or less. If the NIE proposition that they respond to costs and benefits I think is essentially correct, and I think if you look at the behavior of the regime, it's been reasonably predictable.

COBURN: Yes. How about you, Stephen?

RADEMAKER: The premise of all the international diplomacy that's taken place since 2002 -- the imposition of carrots and sticks, incentives and disincentives -- the premise is that they are a rational actor and if under enough pressure, will do what we're asking them to do. I mean, it's hardly a revelation in the NIE to say that that's our premise.

COBURN: Ambassador Ross?

ROSS: I think generally, but I think they have elements in the leadership that are not...

COBURN: OK.

ROSS: ... that believe fundamentally in something else. And the question is, what's the balance of forces within that leadership and how do you affect it so that those who are pragmatic -- when you say rational, I say those who are pragmatic in terms of protecting their interests and the regime -- so that you affect those who reflect that mindset, and they hold greater power right now.

ALLISON: On your sanction point earlier, I think that I agree very much with the proposition, that it's bizarre, I say in my testimony ironic, even, that many of the members of the sanctioning coalition seem readier to run the risks of a military attack on Iran than to impose sanctions that would be sufficiently harsh to have a chance of changing Iran's behavior.

COBURN: Yes. They behaved like U.S. senators. They're rational to the next general election, but not to the future of the country. I mean, there's a great correlation.

It's like on fixing social security or Medicare or Medicaid. Well, we know we've got to fix it, but we can't do anything about it because it might affect the short term.

ALLISON: Forty percent, as you said earlier, 40 percent of the gasoline that's used every day in Iran comes imported. Is it possible to interrupt that? Yes, it is.

COBURN: Yes.

ALLISON: Now, would it have an impact on gas prices here? Yes, it would. Who's in favor of that? Not the administration. I don't know how many senators are.

COBURN: Well, the fact is, we have a big problem, and there are a couple of coming consequences. The question is, are we willing to pay some of the sacrifice to have that consequence?

One is, some military action at some point in time, or some cost and sacrifice on our part to avoid that, from an economic standpoint. The question is, that's not always necessarily clear and out there among the choices that we get to make.

I want to make one other point and see if you all agree with it -- and we've seen this be true in the past. And I want to take issue a little bit -- I think Libya came to the table because there was an invasion of Iraq, and it didn't have anything to do with sanctions. I think they finally just said, "I give up. I don't want this happening to us."

I think there was some pressure was sanctions, but the real truth of the matter is, here's this bold move, and we don't think we want to invite that. So, you know, I think there was a big difference.

And we had testimony earlier on the fact that at the time, in 2003, we didn't have sanctions on Iran at the time we invaded. And the secretary correctly pointed out that that was a big impact in 2003.

Can you not have uranium enrichment and still have weaponization?

ALLISON: Unless Iran were successful in buying enriched uranium from another state, no.

COBURN: Well, if they have enriched uranium, if they had that at some point it time, is it clear to you that they would have the capability to weaponize that?

ALLISON: Yes. If they have...

COBURN: Does everybody agree with that?

(CROSSTALK)

ALLISON: If they have enough enriched uranium, they can make a bomb, yes.

(UNKNOWN): Not 3 to 5 percent enriched uranium, but yes, weapons-grade.

ROSS: Can I answer the question you posed earlier? You said, if talking doesn't work, what are the choices? Well, then the choices are basically two.

One is, you come up with what is a very vigorous containment approach which is quite visible within the region, or you act militarily to forestall what they're doing with the message that you'll do it again if they proceed. Those are the kind of choices you have.

I would say this, I mean, I think that the reason I prefer the third way is because I don't really like either of those outcomes, because I can see all sorts of consequences that are not so great. But you put your finger on something: There is no cost-free approach right now, and we have to decide which of the least costly, or least bad, options are the ones that are available to us?

COBURN: Ambassador Ross, would it behoove us to work on containment now, given the fact that our other options are not great? In other words, plan for containment, signal containment, put that out there as another leg in the stew?

ROSS: For me, the answer is yes, and for a particular reason. Deterrence is not just deterrence at the time; deterrence can also be about dissuasion.

COBURN: Yes.

ROSS: And if you're trying to persuade, again, that part of the Iranian leadership, they're not going to gain anything. They have a lot to lose, and they're not going to gain anything. And if they think that a nuclear weapons capability is going to give them leverage in the region, they should think again.

COBURN: So that takes time, so you would agree that we should start that process now?

ROSS: I would.

COBURN: Mr. Rademaker?

RADEMAKER: I guess I would just add one footnote to Ambassador Ross' comment, responding to your earlier point. The risk that diplomacy may not succeed certainly is not an outcome we want, but that risk is not an argument for making an offer to the Iranians that is so attractive that they have to say yes to it. In other words, a successful diplomatic outcome is not necessarily preferable to some of the other alternatives.

Dr. Walsh has a statement in his prepared remarks that -- I'll just read it to you, because I disagree with it -- he says, "The worst possible outcome is a purely national program on Iranian soil, whether it is unsafeguarded or undersafeguarded." I think what he means by that is, basically, if they continue deploying additional centrifuges, they stand up the enrichment capability they're seeking, and we don't have any additional international safeguards than exist today. That's the worst possible outcome, according to his testimony.

I think that's not right, because at least today it's an illegitimate program. The United Nations Security Council has condemned it four times, sanctions have been imposed, it is an illegitimate program.

Certainly one consequence of any diplomatic settlement with the Iranians on this issue is going to be that illegitimacy, that stigma, will be removed. The U.N. sanctions will be lifted, the Security Council will back away, and whatever program we sign off on will be internationally legitimate. And if it is essentially the same program that they're going to achieve if they continue down the current path and diplomacy fails, but it's legitimate, I think that's a worse outcome than them continuing down the current path.

And let me just, you know -- I think the rejoinder to what I just said is, "Well, international inspections are reliable, and if we can get, as part of a diplomatic settlement, enhanced international verification and inspections, then we can have a higher level of comfort about that kind of outcome."

I just want to read you a quote which I've always enjoyed, and this is on the issue of international inspections: "Every form of deception and every obstacle baffled the commission. The work of evasion became thoroughly organized. Under civilian camouflage, an organization was set up to safeguard weapons and equipment. Even more ingenuity was used to create machinery for future production of war material."

You know, it sounds like George Bush on Iraq; it's not. It's Winston Churchill on Weimar, Germany, and their evasion of the international inspection regime that was set up under the Treaty of Versailles.

So the idea that international inspections will save us from a bad outcome is not a new...

(CROSSTALK)

COBURN: ... we have irrational behavior on the part of the supreme leader and the RGC.

WALSH: If I may respond, that would not have been my rejoinder. It seems to me, if the choice is between a stigma on one hand, and a nuclear weapons capability on the other, I'll take stopping the nuclear weapons capability every day of the week. I mean, an Iranian program that is nationally owned and is not transparent, but opaque, because either they have minimum safeguards -- you're saying enhanced; how do you feel about minimum safeguards? -- minimum safeguards or they pull out of the NPT, that's the quickest route to a bomb.

My proposal -- our proposal, those who talk about this -- is about preventing an Iranian nuclear weapons capability, not enhancing it. And I will...

COBURN: Let me just add one thing. Nobody that I've asked in leadership in this country, and no expert that I've asked, that doesn't believe that Iran is seeking a nuclear weapon. Nobody.

What would make us think that anything other than cold, hard consequences to that is going to work?

WALSH: Well, the nuclear age would be one. Look at the history of...

COBURN: You've already answered the question about how rational they are. The reason we were very successful during the Cold War is, one, we talked, but number two is that there was a rational pattern of thought that wasn't based on martyrdom; it was based on survival. It was based on staying alive.

That is a consequence that has to be figured in in terms of how we negotiate with these people and how we think about how they think. Senator Coleman raised that issue, and I think it's a great issue. That's stuff that we've not ever dealt with before as a nation.

Ambassador Ross, you have, in terms of the Middle East in certain areas, but that's not routinely what we see. And this assumption that survival is a guide to bring people to the table when, in fact, there's tremendous human rights violations of the people who aren't in the religious leadership in Iran today, and what they claim about what they believe, really mixes the common sense and logic that we could defer from having negotiations.

WALSH: Senator Coburn, we heard the same thing about the Soviet Union, the same sort of cultural argument, from Collin Gray (ph) and others who said the Soviets would accept unacceptable levels of deaths, they weren't the same as Americans, they weren't -- that whole sort of cultural argument we heard during the Cold War, and it turned out not to be true.

I'm not saying that the Iranians are perfectly rational. Like Americans, they can be prideful, they can make mistakes, they can bear significant economic costs in the defense of things they think are important.

But in the main, they've been a status quo power. Some had thought that they had chemical weapons after the Iran-Iraq War. Did they turn around and attack Israel? Have they picked a direct, big war against Israel? No.

And on this issue of the regime, when did -- he quotes Churchill -- what did Saddam do when inspectors were on the ground? He decided that he would give up his weapons program -- this is from the Iraqi survey group and from others -- he would give it up. He still had ambitions, but he gave up the program because he didn't want to get caught when there were inspectors on the ground. I think there's a lesson to be learned there, and a lesson that applies here.

COBURN. All right. Thank you.

Thank you, Mr. Chairman.

CARPER: You bet.

This has been just an extraordinary panel. You know, we have hearings every day of the week around here. Sometimes they're pretty good. This has just been extraordinary.

And I thank you for thinking outside the box. I thank you for making us think outside the box and for a very constructive testimony, and going back and forth with one another, I think, in a most constructive and respectful way.

Something else?

COBURN: Yes. Just unanimous consent -- I have several questions that I would like to submit for the record and ask that you answer them, if you would. We can't take the time here to get -- I'd like to spend two days with you all.

(LAUGHTER)

(UNKNOWN): Thank you.

CARPER: Well, the hearing record will stay open for two weeks, and so we'll -- I know I'm going to have some questions as well. But we thank you very, very much for being with us today and for your thought and your responses.