Trump's 'maximum pressure' on Iran is causing U.S. some self-inflicted damage

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TODAY:

• Unless a way can be found to salvage the Joint Comprehensive Plan of Action nuclear deal that Donald Trump is trying so hard to tear up, Tehran now intends to resume work on its Arak nuclear plant and enrich more uranium as fuel — for reactors, and potentially, nuclear weapons.
• Vladimir Putin's government is trying hard to sell its Syria military campaign to an increasingly unenthusiastic Russian public.
• "Ghost guns" that can't be traced are creating new problems for police.
• Missed The National last night? Watch it here.

Iran sanctions

The clock is ticking.

Iran's government has given Britain, China, France, Germany and Russia 60 days to find a way around U.S. sanctions on its banks and oil exports, otherwise it threatens to restart its nuclear program in earnest.

"We are ready to negotiate," Iranian President Hassan Rouhani said in a televised speech this morning. "It is not us who left the negotiation table."

But unless a way can be found to salvage the Joint Comprehensive Plan of Action nuclear deal that Donald Trump is trying so hard to tear up, Tehran now intends to resume work on its Arak nuclear plant and enrich more uranium as fuel — for reactors, and potentially, nuclear weapons.

"We will not start breaching commitments and waging any war," Rouhani said. "But we will not give in to bullying either."

In the year since Trump announced his intention to pull the United States out of the seven-party pact and started re-imposing unilateral sanctions, Iran's economy has been hit hard.

The GDP, which grew by 12.3 per cent in 2016, contracted by almost four per cent last year. It is expected to shrink by a further six per cent in 2019.

The official youth unemployment rate is 27 per cent. Iran's currency, the rial, has lost close to 60 per cent of its value since the sanctions began and is now trading at a black-market rate of 154,000 per U.S. dollar.

The cost of vegetables is up 47 per cent in the past year, and meat and poultry cost 57 per cent more. The price of housing and medical services have both climbed by more than 20 per cent. And the overall inflation rate is expected to touch 40 per cent in 2019.

Yet it is fear of what is still to come that appears to be driving Tehran's new gambit.

Last week, the Trump administration ended the waivers that it had granted to Iran's biggest oil customers, China, India, Turkey, Greece, Italy, South Korea, Taiwan and Japan. The announced goal is to reduce Iranian oil exports — already down over a million barrels per day to 1.1 million bpd — "to zero."

Then on the weekend, John Bolton, Trump's national security advisor, announced the deployment of a U.S. Navy carrier strike group and a fleet of B-52 bombers to the Middle East, in response to what he termed a "credible threat" from Iran, although no details have been provided.

Yesterday, U.S. Secretary of State Mike Pompeo blew off a scheduled meeting in Berlin with German Chancellor Angela Merkel, in order to make a four-hour stopover in Baghdad and ask Iraqi leaders to help protect American troops.

The White House has already reacted to Iran's partial withdrawal from a deal that it doesn't support.

"Expect more sanctions soon. Very soon," Tim Morrison, a U.S. national security council director, said during a Washington panel discussion this morning.

Trump's "maximum pressure" campaign is certainly hurting Iran, but it's causing some self-inflicted damage too.

The Germans are none too happy about Pompeo's last-minute snub.

"This is difficult to excuse," Süddeutsche Zeitung, one of the country's largest dailies, complained in an editorial. "The German-American relationship is in tatters."

And it's not clear whether the Chinese, who are locked in their own trade war with the U.S. president, will respect the oil embargo.

Last month, with the waiver set to expire, China imported a record 40 million tonnes of oil — more than 10.6 million barrels a day — much of it from Iran. So far, Beijing is being cagey about whether it intends to stop. But with $200 billion worth of new U.S. tariffs set to hit Chinese goods on Friday, the incentive to cooperate might disappear, at least in the short term.

The winner of the escalating tensions between America and Iran will likely be Russia.

With U.S. sanctions against the Maduro regime already keeping Venezuelan oil from world markets, prices are up 30 per cent so far this year and stockpiles are falling.

The Russians are best-placed to fill the Iranian gap, with 500,000 barrels per day of spare capacity thanks to OPEC cuts, and the ability to ramp up production by another 300,000 bpd by the end of the year.

That would provide the Kremlin, which is experiencing its own sanction troubles, with a much-needed revenue boost.

And it would give Vladimir Putin a good opportunity to extend Russia's influence among all those nations who will be looking to replace Iranian oil.

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Russia's Syrian trophy train

Vladimir Putin's government is trying hard to sell its Syria military campaign to an increasingly unenthusiastic Russian public, Moscow bureau reporter Chris Brown writes.

A few months back, Russia's government announced it was taking to the rails in a bid to boost public support for its military mission in Syria — and we were immediately interested.

In 2017, Russia's military invited our three-person Moscow bureau crew to Syria to witness its fight against the Islamic State first-hand, so we were curious how it would present the conflict to a domestic audience.

Militarily, the Syria campaign has been a success for Vladimir Putin. He saved his ally, Bashar al-Assad, from almost certain political collapse, and Russia's air power has ruled the skies over Syria since 2015.

But politically, the results are far more mixed.

The Levada Centre, one of the few independent pollsters operating in Russia, released a report this week suggesting that for the first time a majority of Russians want out of the conflict — because they don't see much gain for Russia.

With a weak economy, Russians want more money spent on things they can directly benefit from, one pollster told us.

The train displaying battlefield trophies arrived in Moscow a few days ago, just in time for this week's Russian Victory Day celebrations. We caught up with it on one of its final stops — in Yaroslavl, a city about 200 kilometres to the north that's famous for its golden church domes.

What we found on the train meshed with our experiences in Syria in some ways — such as the armoured vehicles we saw that were modified for suicide missions, and the many examples of captured equipment that traded hands repeatedly during the conflict. But other items on display deviated in crucial ways from the realities of the Syrian battlefield.

Watch our report on The National tonight.

- Chris Brown

• READ: With public support for Syrian war waning, Russia turns to 'trophy train' to inspire patriotism
• WATCH: The National's story about Russia's battlefield trophy train, tonight on CBC Television and streamed online

Black market guns

"Ghost guns" that can't be traced are creating new problems for police, producer Mia Sheldon writes.

They say every gun tells a story: where it's from, who owned it, where it has been. With the arrival of "ghost guns" and their growing illegal trade on the dark web, that story is getting a lot harder for police to figure out.

Ghost guns are homemade weapons with parts produced on 3D printers (with downloadable files circulating online), polymer presses, or special gunsmithing devices. They're often totally untraceable.

Criminals are also making illegal parts to modify regular guns. A glock pistol can be turned into an automatic weapon, for example.

There have been recent police busts in Alberta, Ontario and Saskatchewan involving homemade firearms.

On the dark web, a corner of the internet that's home to a black market for illegal items, the trade in firearms seems to be flourishing. With some knowhow, an assortment of guns can be purchased and couriered to the address of your choice.

This is just one aspect of the problem facing police we spoke to for our story on The National tonight, who are figuring out how to tackle the now seemingly borderless nature of illegal firearms and get ahead of those trying to profit from the trade.

- Mia Sheldon

• WATCH: The National's story about how illegal guns are circulated in Canada, tonight on CBC Television and streamed online

More from The National's series on guns in Canada:

• READ: Canadians want something done about gun violence — they just can't agree what
• WATCH: The National's story on the urban-rural divide over gun control

A few words on ... 

A long-overdue reunion.

Quote of the moment

"I do not plan to be the moral police, and will not tell people how to live their lives, but I intend to help people get information that forms the basis for making choices. People should be allowed to smoke, drink, and eat as much red meat as much as they want."

- Norway's new health minister Sylvi Listhaug, a controversial populist, announces her bold approach to the public well-being.

What The National is reading

• 'At all times I acted with integrity': Mark Norman speaks after Crown stays breach-of-trust charge (CBC)
• Decade in the red: Trump tax returns show more than $1 billion US in losses (NYTimes)
• Christian woman who spent years on death row leaves Pakistan "for Canada" (CBC)
• Cuba cancels parade against homophobia (BBC)
• Chinese cash fuels luxury car laundering scheme in Canada (South China Morning Post)
• Uber drivers plan strike ahead of much-anticipated IPO (LATimes)
• How Rwanda could become the first country to wipe out cervical cancer (Digg)

Today in history

May 8, 1988: Toronto house prices go through the roof

A promotion and job transfer to Toronto has become more like a sentence. In the four years since 1985, the average price of a detached home in the city has jumped from $109,000 ($237,280 in today's dollars) to $273,000 ($502,230). Many people are saying they can't afford it and are willing to commute from the cheaper outer burbs instead. The bubble was about to burst, however. By 1996, the average price was back down to $198,000 (the equivalent of $302,930 in 2019.) Today, a detached home in the 416 area code costs $1.356 million on average.

Toronto house prices go through the roof in 1988

37 years ago

Duration 2:57

Neil Macdonald reports on the increasingly unattainable cost of real estate in Toronto.

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