The escalation of tensions between Iran and the United States over the past weeks has the world on edge, with observers wondering how the contest will play out: will there be war? Or will there be some type of negotiated settlement—perhaps even one designed to merely avoid conflict for now? Or will both countries continue to live in a stalemate, forcing its citizens to wonder whenever they hear of a new incident whether it will lead to a war.The United States and Iran have engaged in a constant raising of the stakes as a means of securing leverage ahead of possible nuclear negotiations. This is a classic bargaining pattern but in the current context, such an approach is particularly risky due to the potential for misperceptions. The complexities of domestic and regional dynamics are also a factor. In such a situation, absent clear understanding of the other’s motivations and tactics, raising the stakes—rather than securing leverage for effective negotiations—could steer the United States and Iran towards a path toward war.Following the U.S. unilateral withdrawal from the Joint Comprehensive Plan of Action (JCPOA) in May 2018, Iran pursued what can be described as “strategic patience.” This involved an effort to persuade Europe to provide the promised economic dividends of the JCPOA. But given the lack of tangible action to fulfill this pledge, Iranian president Hassan Rouhani announced in early May that Iran would, in accordance with Articles 26 and 36 of the JCPOA, reduce its compliance with the terms of the accord, giving Europe a sixty-day ultimatum.With an economy on a downward spiral, the Islamic Republic senses that it is stuck in the fruitless position of complying with the JCPOA without receiving any of the benefits. Other signatories to the accord have tried to make up for the U.S. decision to withdraw from the agreement, but there now appears to be realization in Iran that those actors have little or no ability to force their firms to engage economically with Iran; the only net outcome is that Iran would eventually grow weaker over time. For Iran’s leaders, this status quo is simply not sustainable.
