Yesterday, the European Union announced that economic negotiations with Iran will resume on Jan. 12, 2005. So, the European Union isn’t wasting any time. The International Atomic Energy Agency just concluded at the end of November a new agreement that Iran will stop enriching uranium, and now the Europeans are moving in to profit.

The mullahs must be rubbing their hands in delight. Privately, officials in the Iranian government are letting the word out that they have pulled a big one over on the world – a political and diplomatic victory … that’s how the mullahs see it. Iranian President Khatami is quoted as saying: “The fact that we prevented our nuclear dossier from being transferred to the U.N. Security Council is a victory for us.” The agreement to stop enriching uranium is only temporary and the agreement calls for even the temporary cessation to be voluntary. There is no legally binding commitment in the agreement – that was negotiated out in the last hours of wrangling.

Moreover, the mullahs feel the IAEA agreement announces to the world that Iran has a national right to pursue nuclear technology. This not only amounts to a significant boost in national pride, the agreement gives further credence to the mullahs as legitimate rulers of Iran – a considerable distance from the United States’ designation of Iran as a rogue state, part of the “axis of evil.” Tehran also is taking great glee that the agreement further isolates the United States from the world diplomatic community, while serving to drive even further the wedge that is separating the United States from the European Union.

The focus of the January economic talks with the European Union will be oil. Iran has made a concerted effort in the last few years to conduct explorations for oil. As recently as 2000, Iran’s proven reserves amounted to 96.4 billion barrels of oil – today that total exceeds 130 billion barrels of oil. There is no danger looming on the horizon that Iran will soon run out of oil. With current production hovering around 3 million barrels a day, Iran at that rate has about 130 years of reserves, just with what’s been found to date.

The economics compel the politics in Iran’s relationship with the European Union. Over 80 percent of all Iranian exports to the European Union are oil. In 2003, oil was averaging around $26 per barrel. As 2004 comes to an end, the average price for a barrel of crude has held at around $45 per barrel. Let’s roughly estimate that Iran has $150 million a day in gross oil proceeds. With Japan, China and the European Union buying an increasing quantity of oil from Iran, those windfall profits will probably stay high. Oil companies in the United States are screaming that the only impact of our sanctions is to keep the United States out of the Iranian oil bonanza.

With oil profits surging at these levels, the banks are certain to hover around. Some two dozen European, Asian and African banks announced this week that they plan to arrange an estimated $50 billion of corporate loans to Iran. One of the banks moving in to participate is BNP Paribas, infamous recently for its role in moving money around for our international friends involved in the oil-for-food scandal at the United Nations. Once again, three of the world’s biggest lenders – Bank of America, Citigroup Inc., and JP Morgan Chase – are shut out of the action because of the U.S. sanctions … something these three are certain to resent.

The pressure on the United States to eliminate the sanctions on Iran is certain to build in 2005. So, why don’t we just give up and join the world party? One reason: Iran is certain to continue building nuclear weapons clandestinely. When Iran gets a nuclear weapon, the terrorist mullahs will gain even more power. Oil plus nukes is a formula certain to appeal to the mullahs who support Hezbollah and the suicide bombers that continue to represent a threat to Israel.

Even here, much of the world doesn’t care. The United Nations passes or threatens to pass resolution after resolution that favors the Palestine Liberation Organization. Besides, Israel doesn’t have any oil. So why don’t we just give in and abandon Israel?

If John Kerry had been elected president, this is most likely the direction in which we would be moving. Remember, in the first presidential debate, Kerry advocated giving the mullahs nuclear fuel for peaceful purposes, as a test, to see if they would keep their word and just pursue nuclear energy, not bombs. This formula didn’t work for North Korea, but that didn’t seem to bother the Democratic Party. After all, it was President Clinton and his secretary of state, Madeleine Albright, who came up with the idea that rogue nations like North Korea could be trusted with nuclear fuel.

Has everybody forgotten how the mullahs like to chant “Death to America” and “Death to Israel”? Or, do we just think they’re kidding? Terrorists don’t make jokes. Take a look at pages 240-241 of the 9-11 commission report and read the text under the heading, “Assistance from Hezbollah and Iran to al-Qaida.”

We are in for a big fight in 2005. Israel cannot be expected to sit tight while their sworn enemy puts nuclear warheads in their Shahab-3 missiles. For 25 years we have been hearing that a freedom movement is building in Iran and that the mullahs are increasingly unpopular. That may well be true, but the mullahs still know how to use terror tactics to suppress dissidents within, as well as attacking enemies without.

President Bush will need understanding from the American people if he is to continue a hard-line approach toward the mullahs. He won’t get any support from our banks, our oil companies, or the Democrats. If President Bush takes the Democrats’ advice and drops the sanctions on Iran, he will still get the blame for any terrorist attack that hits us from Iran. The 9-11 commission tried hard to excuse the eight years of the Clinton administration and pin all the blame on Bush, despite being in office for less than one year when the attacks came.

The Democrats are ready to play the blame game. The president has no choice but to protect the United States, even if he has to stand alone to do so.

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