Editor's Note: Below is a complimentary research note written by National Security analyst General Dan Christman. To access our Macro Policy research email sales@hedgeye.com.

The Future of Iran: The Virus and the Dems - 13981205000415637181505100958241

Spokesperson of the Government Ali Rabiei and Deputy Health Minister Iraj Harirchi at a press conference. Hours after the conference, it was announced that Harirchi himself tested positive for the virus.

COVID-19 has now been added to the multiple cross-currents that have buffeted Iran for years. Crises in governmental legitimacy in the wake of the passenger jet shoot down and a yawning business collapse are now complemented by the coronavirus.  As Atlantic Council President Fred Kemp noted last week, "NOWHERE have high officials been as badly affected." Recent satellite photography of new mass graves near the holy city of Qom reflects Iran's nightmare.    

To make matters worse, Tehran seems bent on a suicidal path to nuclear break-out. Revelations from the International Atomic Energy Agency (IAEA) last week on Iran blowing through the Joint Comprehensive Plan of Action (JCPOA) limit of 300 kg of low enriched uranium frame the worry.   

But what is Iran's future path? The evidence so far is not nuclear break-out. The most significant indicator of a breakpoint is uranium enrichment above 4%; and so far Tehran has kept largely within the JCPOA's limits for this critical metric. 

Further, Iran knows that movement to highly enriched uranium (well above 4% U-235) is not only a "Bibi Netanyahu red-line," but it also risks the EU moving to snap-back UN sanctions. The Supreme Leader obviously wants to avoid both dangers.

Tehran's short-term goal remains re-opening a dialogue with the west, to garner some relief from crushing US sanctions. The chances of this happening this year with President Trump are virtually zero. If Tehran senses that they face an existential moment (i.e., regime collapse), however, even that cannot be ruled out; that moment may be fast approaching.

But far more likely at this point is a cold calculation by the mullahs about U.S. Presidential election dynamics. As Joe Biden surges, Tehran clearly senses an opportunity in early 2021 to engage with a new administration bent on re-joining a nuclear deal strongly supported by the notional Democratic nominee. 

The question of course: do Iran's leaders think they can hold on that long? In the absence of COVID-19, especially given Iran's experiences weathering the Iraq war in the 80's, almost assuredly the answer would have been yes. But now?  Community spread statistics over the next few months should provide the clue.  

Containment by early summer? They'll wait for the November elections. But continuing increases in infections by summer's end? Even the Supreme Leader will conclude it's time to talk to the devil.

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LTG Dan Christman, USA, Ret. serves as Hedgeye Potomac Research’s Senior National Security Analyst, providing deep insight into international affairs and national security. Most recently, Dan provided strategic leadership on international issues affecting the business community for organizations such as the US Chamber of Commerce. Dan’s long history of leadership includes his service as a United States Army lieutenant general and former Superintendent of the United States Military Academy. He served in highly visible and strategically important positions and four times was awarded the Defense Distinguished Service Medal, the nation's highest peacetime service award.

He also served for two years as assistant to the chairman of the Joint Chiefs of Staff, during which time he traveled with and advised Secretary of State Warren Christopher. He was centrally involved during this period with negotiations between Israel and Syria as a member of the Secretary's Middle East Peace Team. Further, Christman represented the United States as a member of NATO's Military Committee in Brussels, Belgium.

Graduating first in his class from West Point, Christman also received MPA and MSE degrees in public affairs and civil engineering from Princeton University and graduated with honors from The George Washington University Law School. He is a decorated combat veteran of Southeast Asia, where he commanded a company in the 101st Airborne Division in 1969.