Nuclear Deal between the United States and Iran: The End of the Prisoner’s Dilemma?

It was the U.S., under Donald Trump’s administration, that broke the pact. Resuming relationships with Iran, already linked to other powerful countries, will not be cheap for the U.S. Indirect negotiations between the two countries started yesterday.

It is hopeful news that the United States has resumed nuclear negotiations with Iran. However, the road will not be easy. What are these negotiations all about? On the one hand, Iran should agree to limit its availability and capacity of fissile material (Uranium 235), and on the other, allow the International Atomic Energy Agency inspectors to monitor the country.

Regarding this last point, it is worth mentioning that this monitoring carried out by IAEA, known as safeguarding, is no more than states ceding part of their sovereignty to this organization, signing treaties that compel them to let the inspectors in under certain conditions. This is not a minor issue; in fact, it is the biggest binding cession of sovereignty that can be signed with a subset of the U.N.

Sovereignty is the main form of currency used in the negotiations between states or between states and international actors. In this regard, we could highlight the work of the Argentine Rafael Grossi, General Director of IAEA, who, on Feb. 21, managed to arrange a three-month treaty in which Iran agrees to keep welcoming the inspectors. Grossi opened the door through which the U.S. could enter.

Sovereign states negotiate with their sovereignty; in this case, Iran is asked to cede its nuclear sovereignty in exchange for future trade benefits or an end to the current embargo.

Up until 50 years ago, international negotiations were basically haggling: I offer a little, you refuse, I offer you a little bit more, you refuse again, and so on and so forth. Reaching an agreement this way is not impossible (after all, that is how you buy a used car), but it is usually exhausting and inefficient. This type of negotiation is also very detrimental if it is a recurrent agreement between two parties. Scholars call it “distributive bargaining”: a party only gains if the other party loses something. The players in this type of negotiation face the “prisoner’s dilemma”: they distrust each other, lie to each other, and try to give the other as little information as possible.

In a reiterative game such as the one of international negotiations, this form of resolving disputes is inefficient and has had suboptimal results in the past. The unexpected success of the U.S. State Department in the negotiations that concluded in the 1957 Camp David Accords between Israel and Egypt radically changed the paradigm, transforming the logic of negotiations, opening the game and creating incentives so that everyone knows what the other party wants. In order to achieve this, two things are needed: mediators to deal with the parts of the conflict (that is, precisely, the role of diplomats) and a system to create the incentives to cooperate rather than haggling. This way, we stop dealing the prisoner’s dilemma and we start playing a securities game.

In the case of Iran, the system was built with a lot of effort and intelligence. During Barack Obama’s administration, the five members of the United Nations Security Council plus Germany, known as P5+1, managed to include Iran in the Joint Comprehensive Plan of Action, which was made formal on July 15, 2015. This constituted the rule system that allowed the players to stop haggling and start trusting. Of course, they were not six friends that had met to have a nice chat, they were negotiating Iran’s nuclear sovereignty. However, there were incentives for everyone.

This setting was discarded by the Trump administration when he left the JCPOA, unilaterally and untimely, in 2018. The idea behind this action was to strengthen sanctions and force Iran to sign a faster and more demanding treaty. Of course, it did not work. In 2016, Iran possessed around 100 kilograms of U235, while the amount is estimated to be around 2,500 kilograms nowadays.

Iran is a tough player and a very dangerous one. It is a theocracy that can push its spending further than most democratic countries, with their demanding public opinions and free press. Iran withstood the pressure from the U.S. and took advantage of Trump’s actions to challenge the international community with several minor individual breaches. This, in turn, has severely undermined the role of the JCPOA.

The Trump administration, with its outstanding naivety, made Iran play a game that Iran knows very well. Moreover, given that it was the U.S. that broke the deal and that Iran has strengthened its position with the acquisition of more negotiating material, Iran will not return to the negotiation table easily (or cheaply). The prospect gets even worse if we remember that Iran has become closer with two members of the P5, especially with China.

Joe Biden’s new approach is more than welcome, but we should not ignore the obvious: this is just the beginning.