Resident Fellow Reuel Marc Gerecht

Two weeks ago, the Bush administration announced it may designate Iran's Revolutionary Guard as a terrorist organization--the first time a foreign military body has received that label. Days later, a top U.S. general in Iraq accused Tehran of training Shiite militants inside the country. The moves came at an already precarious time in U.S.-Iran relations, and have greatly worried Washington's European allies, who see the steps as a prelude to war and fear they will make ongoing nuclear diplomacy with Tehran much more difficult.

Such fears are unfounded, however, and rest on several basic misunderstandings. For one thing, the terrorist label is nothing new, and thus will do little to change the current state of play. For another, Iran represents a much greater threat than Europe typically recognizes. It is not a status quo state that favors stability, as most pundits and governments portray it. Iran is, instead, a radical revolutionary force determined to sow chaos beyond its borders. Assuming that normal negotiations can bring it around is, therefore, a grave mistake. The mullahs don't want peace in Iraq--just the opposite. War may come, but not because negotiations break down. The likely trigger is an Iranian provocation.

Iran's bloody role in Iraq has yet to be widely acknowledged. But the clerical regime is killing U.S. soldiers there. Sophisticated Iranian explosive devices wielded by Shiite insurgents are producing ever-larger numbers of U.S. casualties. The brutal Mahdi Army of Moqtada al-Sadr is probably now responsible for about half of all U.S. combat deaths. Sadr, who visits Iran regularly, has developed close ties to the mullahs. And Iranian Revolutionary Guards have started training his henchmen inside Iraq. Tehran also continues to back the Shiite Badr Brigades, the military wing of the Supreme Council for Islamic Revolution in Iraq. This is increasing internecine violence in southern Iraq, where the feeble British presence has nearly collapsed. Bloody confrontations between the Mahdi and Badr gunmen are on the upswing.

As all this suggests, the widespread belief (shared by the Iraq Study Group, among many others) that Iran wants stability in Iraq is wrong. To understand Iran's true nature, remember Lebanon. During the civil war in the early 1980s, the clerics in Tehran backed a variety of Lebanese Shiites before settling on the most radical of these groups, Hizbullah. Since then, Hizbullah has partnered with Tehran in conducting terrorist operations overseas, as well as destabilizing Lebanon and threatening Israel. If Iran gains commensurate influence in Iraq now, it can be expected to have a similar effect.

Unfortunately, that's likely to happen unless the United States finds more effective ways to counter Tehran. The U.S. State Department has labeled clerical Iran a state sponsor of terrorism for years now, so targeting a specific institution--the Revolutionary Guards--merely adds an appealing note of precision: the Guards have long given aid to a varied list of terrorists, including, quite possibly, Al Qaeda. They are the principal bearers of Iran's revolutionary torch and responsible for a wide range of activities including commercial and industrial enterprises and the country's nuclear-weapons program.

Simply singling out the Guards won't change much. It is unlikely to provoke a significant Iranian response, or to make U.S. allies any more serious about sanctions. The Europeans remain hesitant--and the Russians, Chinese and Indians unwilling--to really coerce Tehran. America's unilateral efforts, particularly its use of the international financial system to block Iran's access to dollars and credit, have proved more successful than many thought possible. But without greater international support, they probably won't force Tehran to moderate its behavior. The Europeans, who are among Iran's largest trading partners, must agree to biting measures--something these states, which are as addicted to noncoercive diplomacy as they are to commerce, seem unlikely to do. In the meantime, the diplomatic process over Iran's nukes will crawl forward or stagnate but is unlikely to lead to war.

Washington can try to exercise soft power--through sanctions, resolutions, diplomatic isolation and rougher rhetoric. But the Islamic Republic, especially its radical president and praetorian guard, are accomplished practitioners of hard power. They are unlikely to be overwhelmed by moderate tactics. Instead, they seem set to continue killing Americans in Iraq, waiting to see if and when the United States gives up and run for the exits.

Reuel Marc Gerecht is a resident fellow at AEI.