Iran’s 2003 Grand Bargain Offer: Secrets, Lies, and Manipulation

By Hassan Daioleslam

In the past year, Iran has emerged as the main concern for United States foreign policy. In the aftermath of Iraq war, the United States is blamed for not pursuing diplomatic means in dealing with Iran. Much is said and written about the lost opportunity of dialogue and settling differences with Iran in 2003.

The “grand bargain” offered by Iran and rejected by US, The missed opportunity to resolve the nuclear impasse. The prospect to coexist with the theocratic regime of Iran. The chance to bring stability to Iraq and peace to the Middle East.

While there have been a large number of articles about the US’s disregard toward the Iranian offer, a thorough examination of Iranian intentions and the possibility of a manipulative misinformation campaign led by Tehran has been conspicuously absent. This study is highly needed at a time when the new NIE on Iran has been released and questions are being raised about the Iranian regime's behavior in 2003.

The purpose of this article is to study the 2003 “Iranian offer,” the motives behind it, its main players, and its outcomes. It will be attempted to show how this “offer” was a masterful deception technique by Tehran’s rulers who needed to buy time to facilitate the internal shift of power, to advance their nuclear technologies, and to strengthen their foothold in the region.

Tehran’s ploy was a well kept secrete plan, conceived by a handful of the highest-ranking Iranian leaders, implemented by Sadegh Kharazi- the Iranian ambassador to France, Bob Ney (former Congressman and current federal prisoner), and his Iranian assistant Trita Parsi. The plan was complex; unraveling it sounds like a mystery novel. To understand it, the Iranian party-line story needs to be studied, the version the Iranian lobby in the US has been tenaciously reciting: the grand bargain. The article will then proceed with examining the missing links in Tehran’s tale in search of a true account of what went on behind the curtain.

It is to be revealed that the characters of this scheme have assisted Tehran’s ayatollahs in buying time towards advancing their malicious hegemony in the region. The profound consequences of this grand ploy range from innocent lives lost in Iraq, to confusion within US foreign policy and the real possibility of an ugly and disastrous war with Iran.

Tehran’s Motives

Between 2002 and 2003, Iran’s ayatollahs were faced with serious challenges and priceless opportunities. Confronted with increasing popular discontent and paralysis of the political system due to the continued factional divergences, the clerical regime was in the middle of a power shift towards the more unified, militant, and conservative faction that Ahmadinejad represents.

With the fall of two unfriendly neighboring regimes, Tehran’s theocratic regime sensed the opportunity to expand its ideological, political, and military hegemony in the region. On the other hand, the US military presence surrounding Iran and the disclosure of the Iranian nuclear program and its subsequent referral to the UN, were major threats to the Iranian regime’s strategic ambitions.

To fend the perils and seize the opportunities, Tehran desperately needed to buy time; hence a sophisticated misinformation campaign in the US, which started with the grand bargain offer of 2003.

The Facade: Tehran’s Party-Line Story

In April of 2003, the Iranian regime extended an olive branch to the United States. The highest-ranking leaders of the theocratic regime developed a proposal for dialogue, peace and friendship between the two countries. Sadegh Kharazi, the Iranian ambassador to France asked Tom Guldiman, the Swiss ambassador in Tehran, to take the proposal, known as “Iran’s Grand Bargain Proposal” to US leaders. 1 Accompanied with a short memo written by Guldiman, the one page proposal 2 was faxed to the State Department on May 4th, 2003. A few days later, Ambassador Guldiman came to Washington to deliver the proposal personally. 3

The affair remained undisclosed for 3 years until early 2006, when international pressure over Iran’s nuclear issue was mounting on Iran; Trita Parsi released a new copy of the Iranian offer to the press.4 According to Parsi, in 2003, the Iranian regime was determined to initiate a dialogue with the United States to resolve all the outstanding issues between the two countries, but an arrogant US government, judging that Iran was at the verge of collapsing, killed the opportunity: 5

In May 2003. The United States had just defeated Saddam in less than three weeks, and I think there were a lot of feelings inside Iran that they needed to present some sort of a negotiation deal with the United States…

Iranians were basically offering significant policy modifications in the hope that this would be able to open up a new chapter in the relationship with the United States, when the United States,

And the argument by the hardliners, the hawks in the Washington -- in the White House at the time was basically that Iran is weak and it’s giving this proposal precisely because of the fact that it is fearful of the United States and that the US can achieve more by taking on the Iranian regime and just removing it than by negotiating. So we had this situation in which, back then, because of America's strength, the Bush administration argued that it could not negotiate… What was really interesting is that when the Iranians put this on the table and they were basically offering significant policy modifications in the hope that this would be able to open up a new chapter in the relationship with the United States.”

Ongoing Negotiations in 2003

Parsi’s numerous declarations are all missing one element: when the Swiss ambassador came to Washington to deliver the Iranian offer, there were already secret but official negotiations going on between the two countries, led by high ranking Iranian diplomats. The Iranian foreign minister and the ambassador to the UN were personally involved. The chronology of these negotiations was reported in the New York Times: 6

On May 3rd, Ambassador Zarif (Iranian ambassador to the UN) meets Ambassador Zalmy Khalilzad and Ambassador Ryan Crocker in Geneva. The US delegation is headed by Dr. Khalilzad. The US has already invaded Iraq and is in control of its Government.”

During the May 3rd meeting, the two countries agreed on another meeting on May 24th in Geneva. Meanwhile, these official negotiations ceased for another reason: 6-7

During the May 3rd meeting, Khalilzad tells Zarif that the US has learned that a terrorist bombing incident is planned to happen in the Persian Gulf area. He asks that Iranian Government utilize members of Al-Qaeda in Iranian prisons for information on the planned incident. The incident happened on May 12 in Riyadh, Saudi Arabia.”

The US blamed the terrorists operating from Tehran and did not show up for the next meeting on May 24th.

Role of Bob Ney and Trita Parsi in the “Grand Bargain”

In early May, Guldimann, who was not involved in the official negotiations, arrived in Washington. He brought with him the Iranian proposal which had been already faxed to the State Department on May 4th. Guldimann wanted to personally brief State Department officials. According to Guldimann's memos, the affair was extremely confidential: 2

S. Kharazi asked me whether I could present the enclosed roadmap very confidentially to someone very high in the DoS in order to know the US reaction to it. He said that the lack of trust with the US imposes them to proceed very carefully and very confidentially. After discussing this problem with him, I understood that they want to be sure that if the initiative failed and if anything about the new Iranian flexibility became known, they would also for internal reason not to be bound to it." (emphasis mine)

The affair was apparently so covert and important, that only four people were informed in Iran, The Supreme Leader, President Khatami, Foreign minister Kamal Kharazi and Sadegh Kharazi:

Kharazi told me that he had two long discussions with the leader on the roadmap. In those meetings which both lasted two hours, only president Khatami and foreign minister Kamal Kharazi were present. The question is dealt with in high secrecy. Therefore no one else has been informed."

The secrecy implied that the Revolutionary Gurads, the National Security Council, the cabinet ministers, and the Iranian parliament were all kept in the dark on this historical shift in Iranian foreign policy. There was however a fifth Iranian involved in managing the issue. This man, so highly trusted by the Iranian regime, was Trita Parsi, Congressman Bob Ney's assistant and president of the then newly founded “National Iranian American Council.”

Following Kharazi’s instructions, Guldiman gave a copy of the proposal to Bob Ney and Trita Parsi. In a long interview with the "Democracy Now", Parsi explained this part of the story: 5

The Iranians gave a proposal to the Swiss ambassador that he then sent to the Swiss foreign ministry in Bern, who faxed it onto the State Department, but the Swiss ambassador also made a personal visit to Washington, D.C. to brief the State Department about the proposal, and he also made sure that he met with Congressman Ney, who has been a longtime advocate for negotiations and dialogue between the United States and Iran, and he handed him the proposal, as well.

I was an advisor to Bob Ney at the time. And Tim met with Bob and handed over the proposal to him. And Bob afterwards sent it to be hand-delivered to the White House to Karl Rove, and Karl Rove called back within two hours, and they had a brief discussion about the proposal.”

Parsi admitted that: “he was the point person for Ney in helping to manage this issue.”8 Obviously, the Swiss ambassador did not intend to put at risk such a historical event by turning to Bob Ney's group. He was surely instructed by his Iranian contacts to do so.

It is hard to explain why Iran did not use its usual channel of diplomacy, which was leading the negotiation with the US to send the grand bargain offer. Why Iran did not ask Javad Zarif, one of the most skilful diplomats Iran has ever had, to deliver the massage to his contacts in the White House and the State Department during his May 3rd meeting in Geneva?

Why did Iran decide to ask Bob Ney and Trita Parsi to “manage this issue” (as Parsi stated) and send the proposal to the White House? What could this team achieve that the Iranian Foreign minister and other diplomats were unable to do? Put simply, couldn't the Swiss ambassador deliver the message directly to the White House without asking for Ney and Parsi’s help?

In reality, the Iranian regime had entrusted Parsi and his boss so much that when three years later, in 2006, the situation was worsening again for the regime of Tehran, Parsi was once again given a new (and different) copy of the 2003 offer and called upon to reconstruct the smoke screen: 9

Parsi, who provided the document to IPS, says he got it from an Iranian official earlier this year but is not at liberty to reveal the source." (Gareth Porter, IPS, May 24, 2006)

We should remember that the choice of Bob Ney’s circle was not accidental. It was the third time in less than a year that Ney's group was called upon by the Iranian regime for special favors. Surely, the White House was informed about Ney’s special relations with Tehran.

At the same time that Ney was delivering the Iranian offer to the White House, he was also involved with two London based felons hired by the Iranian regime. A part of Ney's indictment (that sent him to federal prison) is related to this affair. This story is briefly summarized as follows. 10

In 2002, the Iranian regime wanted to buy a VIP aircraft for their officials. Restricted by US sanctions, the Iranian defense ministry founded a company in Cypress called Safat Air.11 Then, the Iranian company signed the purchase contract with London based FN aviation, led by two international felons. In order to resolve the sanctions issue, they needed some help in the US and naturally, they found and bribed Bob Ney. In this fiasco, his former assistant David Diestefano and a famous Washington lobbyist Roy Coffee also assisted Ney.

More strangely, is the creation of Trita Parsi's organization called the “National Iranian American Council” (NIAC) in 2002. Roy Coffee, the Washington lobbyist who was involved in Ney’s dealings with FN Aviation, wrote a letter to the Dallas Morning News on February 2, 2006 and declared: 12

Back in the spring or summer of 2002, a good friend of mine from law school, Darius Baghai, had just returned from visiting relatives in Iran for the first time since his family left before the revolution. He spoke with me about how the economy of Iran was humming and that the US was missing out because we were the only country imposing sanctions on Iran since 1979. .. From this, I took Darius into visit with Mr. Ney. What was to be a 15 minute meeting became a 1 1/2 hour meeting as they spoke passionately about their hopes for the Iranian people. They also spoke in Farsi a great deal - I'm sure talking smack about me. From that meeting, Darius, Dave and I began to work with Trita Parsi, another Iranian-American to try to form a political action committee of Iranian-Americans to pursue a strategy of normalization of relations between the two countries."

Is it accidental that the timing of this “grand bargain offer,” the timing of Ney’s affair with the Iranian backed international felons, and Ney’s group’s involvement with Trita Parsi to create a lobbying political affairs committee for normalizing relations between Iran and the US, overlapped?

Is it accidental when Tehran needed to create the pretence that they were offering an olive branch to US, they went to Trita Parsi and Ney’s group, the same group that was helping Tehran in removing US sanctions? What could this small group of people achieve that the Iranian diplomats were unable to fulfill?

Grand bargain or buying time?

In 2003, Mohammad Khatami was a totally powerless president. He did not even have control on his own government, let alone foreign policy, which was the Supreme Leader’s exclusive domain. Was the Khatami government mandated by the Supreme Leader to negotiate with the US to settle the problems between the two countries? The answer is clearly and unequivocally no. Elite members of Khatami’s government have brought clear responses to these questions:

Mohsen Amin Zadeh, the senior Iranian deputy foreign minister (1997-2005) 13

Mohammad Khatami’s government was authorized (by the Iranian ruling power) to engage the United States about Afghanistan and Iraq and was permitted to have some kind of collaboration on these issues but was forbidden to negotiate the main issues of national importance like the sanctions. There was a group in Iran that did not want to use the opportunity created at the time to resolve the most important problems of Iranian foreign policy (US-Iran relation).”


The political group “Mojahedine Enghelabe Eslami,” a main component of Iranian government in 2003 was even more explicit: 14

It should be emphasized that during the reformist government (1997-2005), the US administration was trying by different means to open a dialogue with Iran. But, on our side, there were some groups in Iran, which did not give the permission to Khatami’s government to take effective steps in this direction”

More illuminating, is Sdegh Kharazi’s own declarations. He is the initiator of the 2003 offer. He admitted that the conditions were not ready for any kind of bargain. He gave a long interview to Etemad newspaper on February 2, 2007 of which an excerpt is below.

Question: Why was the opportunity to normalize the relations with the US lost under Khatami (1997-2005)?

Kharazi: Khatami was not given the permission to proceed in this direction. Some initiatives were launched to dissipate the mistrust between the two countries but did not advance. The conditions for a dialogue were not ready in Iran and in the US.

In an interview to the Iranian press, Sadegh Kharazi was clear about the Iranian regime’s goal in sending the grand bargain offer, which was to neutralize an American military strike: 15

In 2003 there was a wall of mistrust between Iran and the US and they could attack us at any moment. Therefore, the government accepted my suggestion and sent a conciliatory letter to the US administration.”

Was Iran seeking a settlement with the US or just looking to reduce the tensions and overcome a critical and dangerous situation in 2003? During a public debate in November 2006, Hamid Reza Taraghi, the head of “Heiate Motalefe”, one of Iran’s main conservative groups declared: 16

After 9/11 and its consequences, we were very worried and a group of the deputies met with the Supreme leader and explained the root of their fear. We reached the conclusion that Iran was facing a real threat and we could be occupied as it happened in 1941.

We asked the Leader to be more moderate toward the US. He accepted our view and through the government and other officials, wisely and successfully managed that dangerous time”

The best way to understand the Iranian goals in 2003 is to see its policy over the nuclear issue, which was on the verge of being referred to the UN. Pressured, Iran decided to suspend its Uranium enrichment.

Was Iran seeking to resolve the dispute over its nuclear program or was it trying to pass the storm and buy time? The answer given by the Iranian chief negotiator at that time is clear and unequivocal: “Buying time to complete those parts of the program which needed to be improved”. In a recent speech, Hassan Rohani defended the regime’s decision to cede to European pressure in 2003 and suspend uranium enrichment: 17

During the period that we suspended the enrichment, we built the centrifuges, built the Arak center and as a whole, we completed every aspect of the program, which was incomplete. The West wanted that we suspend the enrichment to stop our program but we suspended it to be able to improve our program. By suspending, we were able to pass the danger and at the same time, strengthen our program.”

The readers can also watch a video from the Iranian negotiator in 2003, Hossein Mousavian, who with astonishing clarity explains how: “the negotiations with the European Troika helped Iran to buy time to complete the Esphahan UCF project and also the work on centrifuges in Natanz.” 17

The 2003 Offer Was Part of a Broader Misinformation Campaign

The 2003 offer had the immediate goal of disarming and undermining potential American action against Iran. This offer also was a major element of an unprecedented misinformation campaign to disguise the nature of the Iranian regime and its intentions. The campaign was high priority for Tehran at a time when the Iranian power structure was experiencing a fundamental transformation towards Ahmadinejad's era.

Iran never intended to conduct serious negotiations with the US to settle problems. As seen with the “Iranian Grand Bargain,” Tehran preferred the Swiss ambassador to its own negotiating team. Iran also made sure that its friends in Washington (Ney's circle) would be involved in the delivery of the blueprint. This inclusion could guarantee that any time in the future that US administration would decide to be harsh on Iran; the friends would come forward and tell the public the story of US failure and Iranian flexibility.

This scenario was exactly what happened in 2006 when the Iranian nuclear issue was referred to the UN and there was fear of harsh measures by the US. Then, the Iranian regime gave a fresh copy of the offer to Trita Parsi. This goal is so evident that even Ray Takeyh, the CFR expert and one of the most ardent defenders of engaging the Iranian regime had to admit: 18

Look, to be frank, the 2003 argument is useful if you want to beat up on the Bush administration. If you want to go out there and say Condi's lying and, you know, Bush administration is censoring, if that's -- then it's useful, as a stick to beat the Bush administration as a government, as an administration that purposely missed a historical opportunity to reconcile Iran and America and assure the epoch of bliss. It's useful in that sense.

I don't think it's useful in terms of assessment of Iranian foreign policy and where it is today.”

Beating up” the US administration is a part of bigger campaign to prevent any harsh policy toward the Iranian regime. This was exactly the essence of what Trita Parsi and his Iranian partner Siamak Namazi wrote in a joint paper in 1999: “An Iranian-American lobby is needed in order to create a balance between the competing Middle Eastern lobbies, set up this goal. Without it, Iran-bashing may become popular in Congress again.” In a separate article I have discussed the creation of this Iranian American lobby in the US and the role of Namazi, Parsi, and Sadegh Kharazi. 19

This group has achieved one of the most formidable campaigns to present the Iranian dictatorship as a permanently pragmatic regime which bears no threat to the US and is always ready for a deal. The 2003 offer has been the foundation of this campaign.

As a result of this campaign, the gap between what Parsi and his friends have been proposing to the American public and what really happens in Iran is flagrant. For example, in 2006, Parsi initiated an anti-war petition signed by him and several American organizations. After denouncing US policy toward Iran, they declared: "The US has refused to start a dialogue with Iran for the past 26 years” 20

We can compare Parsi's declaration with a public statement by one of the main factions of the Iranian government from 1997 to 2005. The Mojahedine Enghelab Elami released a statement in July of 2007 about Iran-US relations. In this piece, the authors incriminated the Iranian leaders for the US-Iran impasse and declared: 21

This question has remained unanswerd that why Iran did not respond positively to American gestures to resolve the problem between the two countries. While there was an ideal condition to settle our differences with US and American leaders took the most reconcible positions toward us and declared that they are ready for unconditional dialogue with us and even told that they understand some of our positions like our opposition to the Middle East peace process, but we did not respond to them."(emphasis mine)

In a separate paper: "Pro-Ayatollahs Disinformation and Manipulation Campaign by Washington Think Tankers" 22 I have discussed this extraordinary campaign of misinformation in favor of the Iranian regime, especially in 2003-2004 when Iran was trying to mask the rise of Ahmadinejad’s faction. During this time, this campaign was focused on publicizing the idea that a pragmatic faction is replacing the reformers and this imaginary faction is aiming for a “Chinese model” of development. Even more stunning, when the reality about this extraordinary amalgam was becoming visible and the mirage of the Chinese model was fading, the very people who fabricated this mirage came back with a new suggestion, that Iran is close to a "lite Chinese model." Interestingly, the inventor of such a mini miracle was none other than Trita Parsi's partner in Tehran, Siamak Namazi. I highly recommend the readers to study Namazi's paper that is a master of misinformation in order to see how some Iran experts in the US have been repeating his claims. 23

The key to understanding the Iranian so-called 2003 grand bargain offer and its impacts on US politic resides within Trita Parsi and his former boss, Bob Ney. We know little about the 10 years of relations between them and the Iranian regime. What we do know is enough to ask serious questions.

On December 28, 2006, the governmental newspaper Aftab in Iran published an interview with Trita Parsi. In his introduction, the editor underlined the role of Iranian lobby in US and considered it as its “unofficial diplomacy.” Next to Parsi’s photo, the article’s title reads: “The Iranian Lobby Becomes Active?” A translation of parts of the article is as follows: 24

The conflict between Iran and the West on Iran’s nuclear file has entered a critical state. The government must now utilize all the possible resources to defend the national interest. In this, we have not paid enough attention to the potentially significant influence of the Iranian American society in moderating the extremist policies of the White House. In comparison of this untouched potential to the influence of the Jewish lobby in directing the policies of Washington in supporting Israel, we see the difference between what is and what could be. The role of unofficial diplomacy has been correctly underlined by experts” (emphasis mine)

Another governmental commentator was more explicit about how this “unofficial diplomacy” could “moderate” the policies of the White House: 25

We have successfully aligned the public opinion of Middle Eastern and Latin American counties to our cause but have not attracted the public opinion in the Western countries, where it could affect the governmental policies toward Iran.

Aligning the Western public opinion to our side could be greatly helpful to our national security. For example, anti-war demonstrations or the opposition by public opinion or political parties against the economic sanctions against our country is a winning card in the hand of our foreign policy planners.”

The 2003 grand bargain could only be viewed as a part of the Iranian regime’s unofficial diplomacy, in harmony with its general foreign policy.

Hassan Daoleslam is an independent Iran Analyst and writer. He is well published in Farsi and English. He has appeared as an expert guest in the Voice of America-TV as well as other Persian media. Daioleslam has three decades of history of political activism and political scholarly analysis. http://iranianlobby.com/

Notes:

Glenn Kessler, Washington Post Feb. 14, 2007 http://www.washingtonpost.com/wp-dyn/content/article/2007/02/13/AR2007021301363.html

A copy of Iranian offer by Washington Post: http://media.washingtonpost.com/wp-srv/world/documents/us_iran_roadmap.pdf

Nicholas Kristof, New York Times, April 2007 http://kristof.blogs.nytimes.com/2007/04/28/

Gareth Porter, IPS, May 24, 2006: http://ipsnews.net/news.asp?idnews=33348

Trita Parsi's interview with Democracy Now, Feb. 26, 2007: http://www.democracynow.org/2007/2/26/ex_congressional_aide_karl_rove_personally

The Grand Bargain, American Iranian Council: http://www.american-iranian.org/pubs/articles/The_Grand_Bargain_April-May_2007.pdf

The Council on Foreign Relations Task Force Report on Iran 2004, (p. 29) http://www.cfr.org/content/publications/attachments/Iran_TF.pdf

Steve Clemons, Feb. 17, 2007: http://www.huffingtonpost.com/steve-clemons/what-did-rove-do-with-200_b_41472.html

Gareth Porter, May 25, 2006: http://www.commondreams.org/headlines06/0525-05.htm

DOJ on Bob Ney: http://www.usdoj.gov/opa/pr/2007/January/07_crm_027.html For a complete story go to http://www.sourcewatch.org/index.php?title=Bob_Ney

The VIP airplane and role of FN Aviation reported by Iranian Press: http://baztab.com/news/24835.php also: Times of London: http://business.timesonline.co.uk/tol/business/law/article2576175.ece

Roy Coffee's letter: http://frontburner.dmagazine.com/archives/013069.html

Nameh magazine # 49, March 2006

A review of Iranian diplomacy under Ahmadinejad, Asre No reprinted by Rooze, March21, 2007 http://emruz.info/ShowItem.aspx?ID=6047&p=1

Asre Iran and Raja News Feb. 20, 2007 http://www.asriran.com/view.php?id=12170

March 22, 2007 Emrooz news web site from the "Goftegoo" Radio station, broadcast on Jan, 31, 2007

Aftab News http://www.aftabnews.ir/vdchzqn23vnq-.html. Also watch an interview by Hossein Moussavian http://www.memritv.org/clip/en/805.htm

Ray Takeyh, Time for detent with Iran, CFR, Feb. 22, 2007 http://www.cfr.org/publication/12718/time_for_detente_with_iran.html?breadcrumb=%2Fbios%2F112%2Fgideon_rose

Iran’s oil Mafia, FrontPage Magazine April 16, 2007 http://www.frontpagemag.com/Articles/Read.aspx?GUID=B30E945B-5F1F-4A57-A7AA-F4975D12FC4C

http://www.downsizedc.org/blog/2007/mar/08/no_war_with_iran_coalition

Mojahedine Enghelabe Eslami, Asre No, Published by Emrooz, Auguste 16. 2007 http://emruz.biz/ShowItem.aspx?ID=9194&p=1

Pro-Ayatollahs Disinformation and Manipulation Campaign by Washington Think Tankers, Auguste 1, 2007 http://www.americanchronicle.com/articles/viewArticle.asp?articleID=33939

Siamak Namazi, What happened to the Chinese model, Wilson Center Nov. 16, 2004: http://www.wilsoncenter.org/index.cfm?fuseaction=events.event_summary&event_id=95452 you can read a copy of his speech at: http://www.wilsoncenter.org/events/docs/SiamakNamaziFinal.pdf

Aftab, Dec. 28, 2006: http://www.aftabnews.ir/vdccpoq2biqpp.html

Shargh newspaper, Nabiollah Ebrahimi, republished by Aftab July, 7, 2007: http://www.aftab.ir/articles/politics/iran/c1c1183822467p1.php