Kerry: Dollar could suffer if US walks away from Iran deal

Congress appears likely to vote to disapprove of the agreement, with the Republican caucus united in opposition and with a plurality of Democrats still publicly undeclared.

August 11, 2015 20:11
3 minute read.

Kerry speaks on the nuclear agreement with Iran

Kerry speaks on the nuclear agreement with Iran


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The dollar may lose its place as the world's reserve currency if the US Congress votes to kill the Iran nuclear deal, US Secretary of State John Kerry said on Tuesday.

In a forum hosted by Reuters news service, Kerry predicted that foreign powers would lose faith in the word and commitment of the United States— and would balk at the notion of reimposing sanctions on the Islamic Republic, just weeks after the Joint Comprehensive Plan of Action had been successfully brokered.

Kerry's appearance was part of a broader push by the Obama administration to take its case for the deal to the American public, which appears skeptical of the agreement, according to several national polls. Congress will vote to approve or disapprove of the agreement in September.

"If we turn around and nix the deal and then tell them, 'you're going to have to obey our rules and sanctions anyway,' that is a recipe, very quickly," Kerry said, "for the American dollar to cease to be the reserve currency of the world."
Iran deal in a nutshell

Congress appears likely to vote to disapprove of the agreement, with the Republican caucus united in opposition and with a plurality of Democrats still publicly undeclared. In an interview with CNN this week, the Democratic whip in the House of Representatives said that it would be best to keep sanctions in place, and disagreed with the assertion made by US President Barack Obama that congressional disapproval would lead the US "down a path to war."

But the Obama administration only needs to win one third of one chamber, in only one of two votes, in order to preserve the deal through an attempt to override the president's veto of a disapproval resolution.

Only one Democratic senator, Charles Schumer of New York, has declared opposition to the agreement. A poll released on Tuesday suggested he can rest on the support of New Yorkers: 43 percent of New York City residents oppose the JCPOA, according to Quinnipiac Poll, while 36 percent approve of it.

The same poll found that 53 of Jewish New Yorkers disapprove of the deal, while 33 endorse it. The poll has a stated margin of error of plus or minus 2.9 percentage points

Kerry said that he has spoken several times to Prime Minister Benjamin Netanyahu to discuss the deal since it was announced on July 14. Netanyahu is the most vocal critic of the accord.

"We've agreed to disagree," Kerry said. "He represents his country," he continued, "but we represent the United States."

And the US will never allow Israel to be "blackmailed" or "existentially threatened," he added, arguing that the deal is, in fact, a fundamental good for Israeli security.

"We're now upping what we're going to do for Israel," he said.

The secretary personally engaged his counterpart, Iranian Foreign Minister Mohammad Javad Zarif, over nearly two years of negotiations, and said that he entered the deal with a hope that Tehran will change course, away from engaging in what the administration refers to as "malign activities"— destabilization across the Middle East.

But he reiterated the JCPOA is not based on hope. And he noted that, as a signatory of the Nuclear Non-Proliferation Treaty and now a legal participant of its Additional Protocol, Iran is never allowed to pursue nuclear weapons.

"They don't have a right to enrich," Kerry said, asked whether the US had granted such a right under the deal. Uranium enrichment is one of two primary pathways to the fissile material necessary for an atomic weapon. "But the NPT also doesn't ban it."

"They became a nuclear threshold nation while we had a policy of no enrichment," he continued. "Only President Obama has put in to place a program that has rolled back their program."

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