Welcome to all of you and to the counsel and formulations, family and friends actually, an awful lot of people here who have done a lot of work on Iran and who have followed the issue and that's terrific. Of course today as a many of you know is election day and I hope you've all voted, and if you haven't you are going to go out and vote again very soon. Interestingly election day is in November, our big day is for people who work on Iran. People will remember, I remember vividly how during the last year before the overthrow of the Shah, there was a uprising it thereon University that was put down by the Shah people on the 4th of November, and then a year later it was on the 4th of November the hostages were taken and the US Embassy was overrun, and it was the following 4th of November that, Jimmy Carter was unelected as President which had something to do with that process though not everything, and so it is a, I've always been struck by the fact that the that my Iranian friends routinely accuse the United States of meddling in Iran's internal affairs, and I say you know you have your record of meddling in our internal affairs as well. We are -- all of you know you are supposed to turn off your Blackberry's and other devices that make funny noises and beep along the way. You will be escorted out of the room if it goes off while we are talking so, or attacked by our watchdogs around the sides. I think all of you are familiar with Ray Takeyh, he is someone who is been at the council now for a number of years, he writes widely, he attends a lot of meetings and he is a senior fellow here at the council and has done a tremendous amount of work. He concentrates on primarily on Iran, Islamist movements and Middle East politics in general. He in the past he has had jobs at the National Defense University, and pretty prior to that both Yale and Berkeley he has had positions. And we are here today to discuss his new book about Iran, is I think all of you also very much aware, at least in my view, Iran and United States are the two most consequential powers in the Persian Gulf, and you don't have to be a strategic genius to understand that the way these two powers interact with each other is going to have a lot to say about not only the future of the Gulf and oil but also of the Middle East in general. Ray and his new book, Hidden Iran, which is over on the table and there are few copies left that haven't been sold, so you should stop buy afterwards. In his latest book Ray really scripts the way some of the misunderstandings I think that tend to plague all of us in dealing with Iran, and tries to help our policymakers but also just knowledgeable observers to figure out more about what's going on. The introduction to his book which I really recommend to you is called Getting Iran Wrong, and he explains why we had have a tendency to get Iran wrong. And his last chapter is getting Iran right, and in between he discuses a very wide range of issues, just about anything you ever wanted to know about the US, Iran relationship, and about an overview of Iran politics is there and available, and so, as I say I do recommend it to. This is a very skillful policy brief, and written in a very smooth and graceful style, that is very very accessible and I like it very much and so when I wrote the review for foreign affairs of this book, that was a very easy job for me to do because I didn't have any bones to pick, my only problem was to try to not be too flattering doing it. I am struck by the fact that Ray's book that he manages to write in the sort of non confrontational style that basically gets the information out in front of you really pushing for a kind of calm pragmatic approach, and you read over all of these issues really thorny difficult issues, and he makes it all seem very sensible and understandable. So what I am going to do is go in to his book today in our opening conversation and pick out the little thorny parts that are hidden away in this overview that is so smooth and relaxed, and say okay, what about a few other things here that are sort of tucked away into the body of this thing and I'd like to ask Ray just a few questions based on that. You start out early in the book by saying that it is, and I am quoting here impossible for Iran to become a rigid authoritarian state, you also make the statement that Iran is inevitably going to change, and that its youthful populous cannot be appease nor silenced. But did that change will have to be at Iran's own pace, not by being opposed by people on the outside. This is a very different picture than standard media affair, and there are certainly people in this room that will understand where that's coming from but it also suggests that United States has little or no role to play in this process, and I just wonder if you could address that. Thanks Gary for the kind words. When you look at Iran and sort of all these complexities, it is a state in the Middle East first of all, probably the only state other than Turkey and Israel where politics matters, where institutions matter, it matters who becomes elected as opposed to most of the other Middle Eastern states that tend to be rather rigid authoritarians state, the succession being more familiar than institutional. And I think that if you look at the constitutional structure of Iran, it was a faction was and division was embedded in that constitutionalism. You know if you look at the name Islamic Republic, on the one hand are a series of institutions and actors that are responsible to the Islamic pillar of the state, yet on the other hand there is a Republican pedigree to the country where it has regular elections for assemblies for parliament, for the presidency and throughout some more years those elections took place, and even municipal councils were throughout the cities and so forth so, and it is electoral process that people pictures with, particularly people in lower and traditional classes who still view franchise as an important right they had been given. So in that sense giving these institutions the policy that comes out of the Islamic republic is an interplay of these actors, institutions and constituencies. That's why Iran can never be one man authoritarian state. Now can Iran change, will it change, it certainly has all the ingredients of change, it has, it's almost a cliché to say that but a very youthful population, everybody size the statistics, 60% of whatever be at age 30, but more importantly Iran has a large and growing middle class, and middle class that is literate. Iran's literacy rate I think is 77%, which is higher than almost any place in the Middle East again to exception being Israel. And it is a literate middle class that knows what's strong with this country and knows who is responsible for it. So in that sense it is the sort of a gradual evolution of the country that can come as I said on it's own terms on it's own pace, there's going to be ebbs and flows, at times there is going to be regression, and at times reform, but the overall movement of the country is toward moderation I'll suspect in the long run as opposed to reaction. Now does the United States and the external the international community have a role to play? I think it's a rather a minimal role because if you look at the United States democracy promotion strategy as such. It sort of relies on broadcast and exiles, I mean I don't really know what broadcast to a country mean in the age of global media and with that degree of literacy and with that degree of access to non-conventional media and web, Persian is the third most used language on the internet followed by English and Mandarin. I mean so Iranians don't really need broadcast from VOA telling them what's wrong with their country. I mean if you are Iranian you have four jobs, you are struggling with inflation and cost of living, you don't really think you life is blissful until you listen to VOA, and you say okay, now I get it. Well that's what's wrong. I say I didn't know that. I thought it was natural to work 4 hour jobs a day but now I know better and I am going to get together with my other friends who have four jobs, I mean I go have a revolution. I just as I said before, I might not be, and one can be sophisticated, I have to appreciate how that works. The obvious sort of money comes in to financing Iranian exiles which or maybe I have a problem with, but I am not quite sure if that could precipitate political change. So we have a, the democracy promotion strategy as constitutes today doesn't have the instruments, we are changing partly because Iran is different from Eastern Europe after 1980s which is a case often sighted, you know Iran doesn't have a cohesive democratic opposition moment similar to solidarity for instance, it has democratic sentiments. It has progressive inclinations but it doesn't have a coherent democracy promotion program, a democracy promotion opposition activity as such so its very different society than Eastern Europe upon which many of these models of democratic transition were drawn. So in that sense we do get Iran wrong if you think it resembles Poland after 1980s where the Eastern Europe block countries where the governments would bridle the opposition forces significant, and so that the gradual collapse of the patron state in this case the Soviet Union precipitated a very dynamic change. You do make a point at one stage in the book where you suggests that Iran actually has the capacity for evolution and change that is really quite remarkable but in fact has the ability to endure all kinds of disasters, and particularly you talk about the fact that Iran has these wild swings of inconsistency that appear on a regular basis, you might just you know since not everybody here since all of the time thinking about Iran, it might be worth thinking a little for you to talk just a minute about the difference between common easily to shift at the beginning right after the revolution and what that meant versus Rafsanjani later on versus Khatami when he came in, and now Ahmadinejad we have seen really four, in fact some Iranians as you know talk about four republics, they are so different, but it is still there you know. Seven years later it hasn't gone away. It is a changing landscape, if you look at the 1980s particularly early 80s before before the onset of the Iran-Iraq war, the Iranian vision was one more of a pan-Islamic one, the founder of the revolution, I mean was called the revolution without borders. And for the revolution succeeded have to be exported beyond borders. It had to it was a real challenge to the regional status quo. That was openly calling for the overthrow of the Gulf states plotting the assassination of Kuwaiti Amirs. The terms that were use to discuss this Saudi monarchy, you know palace dwellers, purveyors of American Islam and the sort of the rejection of the legitimacy of the state system. It was very forceful revolutionary period, now Iran's revolutionary idealism died the same place that American Utopian vision died the battlefields of Iraq. Mostly the Iran-Iraq war encompassing the fair and the country becomes far more focus on waging the war, the slogan as you recall was you know, Jerusalem through Karbala so was a much more focus. Iranian elections subsequent to their twin events, probably the most important events in certainly the tenure of the Islamic Republic, the end of the war with Iraq and the passing of the founder of the revolution. 1988, 1989 is the breaking point, I found then on Iranian elections have always been about something, the last Sanjani election was about economic reconstruction particularly given the devastation of the war, and it was sort of pragmatic recognition that maybe some of the cultural and political restrictions should be less than but largely it was focused on the economic reconstruction and rehabilitation of the state. By the time we get the Khatami's period, Iranian elections matter again but this time they were about political liberalization. About creating a policy that is responsive and accountable to the citizen really. So in essence a feeling to the Republican aspect, the republican pillar of the Islamic republic, you know the idea of being that, you know a durable system is one which is responsive to its constituency. In Ahmadinejad's election 2005 were about economic justice at the time when some of the changes that have happened in the 1990s had made a sort of a class cleavages in Iran the class division rather provocative at the time where there was real class stratification in the society, and there was imbalance in terms of distribution of wealth, it wasn't benefiting everyone, ramps in corruption, which is one of the ironies of the theocratic state that is engulfed with this degree of official corruption so that election was about populism but also about how to distribute economic resources in a more equitable way so it was responsive to a certain constituency as well, in this case more the lower traditional middle classes. But you can see how the state has changed in terms of this domestic appeal and there has not been an attempt since 2005 with a sort of the conservative consolidation to actually clamp down on some of the cultural freedoms that were granted during the reformist era, elections still matter, and it's a society in the perennial source, in a perennial transition which makes it very boggling to deal with and difficult to sort of sort of the grasp and easy to -- Stop for a second with Mr. Ahmadinejad who is some of us had a great pleasure of meeting during his recent whirlwind tour to New York City where he publicized everybody else including George Bush, he was attending the UN. Not Chavez. Chavez only got a afternoon of coverage and it was back to Ahmadinejad job again. Here is the guy who advertises himself, he is a straight shooter and he is a fellow who says what he means, means what he says, a very plain talking guy, he arrived in office with no foreign policy experience at all, he scarcely travel outside the country. He comes from a very conservative religious base, and that's what he draws his support, and he guess would identified himself as a sort of born-again Muslim, just not like about this guy. And he goes to lunch everyday, he goes home everyday for lunch, he doesn't use the cafeteria, he doesn't want to impose on taxpayers. Well there are several problems with Ahmadinejad where to begin. First of all I think he has obviously his some of the strident foreign policy statement and so forth. Number two is he going to be effective in terms of actually delivering on his presidential pledges because all of two predecessors of his Rafsanjani and Khatami ultimately do not and Rafsanjani stayed economic reconstruction did not, less to some degree of reconstruction that also a great degree of corruption and borrowing on the international community and Khatami's case by I think he is tenure is unnecessarily maligned but nevertheless his promises of creating a society that can accommodate both religious values and democratic norms do not come into existent. I mean it was a very difficult time in terms of meeting the economic demands of the society and he came in and at a very pledge of actually getting rid of the oil mafia, he talked about getting rid of corruption, Iran is as far as I can see as corrupt today as it was before the oil mafia is still there. They enhance oil revenues intent to rebound to the local population, there is no coherent economic planning, there is lot of populous projects giveaway focus on small scale industry as opposed to having an effective plan for restructuring an Iranian economy that needs to be restructured. And I think all Iranian Presidents they're coming with office with euphoria, and eventually a process disillusion that sets in, and he might be experiencing a similar cyclical event that is not uncommon in the history of at least tenure of the Islamic republic. Along the way you make the very clear statement, you say it is neither inevitable, nor absolutel that Iran will become a next member of the nuclear club, and then in order to make that happen we need to have a more constructive US diplomacy, can you explain why you haven't joined the group that says Iranian nuclear club is inevitable and what the US can do about it? Well, the nuclear weapons club, I think at this point one can be rather certain that a country will develop some sort of a capability. In nuclear infrastructure of some capability in some magnitude, the question is do you cross that into actually a weapons production so there are different things there. Now the problem today is the US-Iran negotiations are proposed negotiations or focus on one issue that requires a pre-condition of suspension and so forth, how would you negotiate with Iran which is a very difficult country to negotiate with? I would actually, if I was negotiating with Iran, my beginning point would be no proposal for normalization approach. I wouldn't talk about specific selective issues, one day is Iraq, one day it's nuclear, I will say okay we are going to negotiate with Iran regarding how to normalize relations. I mean you know Henry Kissinger went to China 1970, he didn't say my precondition is for removal of all 250,000 Chinese troops from North Vietnam. So we are going to rearrange. The question is what final objective, you are trying to get to a point where Tehran's relationship with Washington means more to is than it's attachment to Hesbolah or it's commitment to certain gradation of Iranian enrichment capability, that's where you are trying to get to. You are trying to get to a point where the country imposes restrain on itself, cease it's relationship with the United States, and it's integration into the global society as generating sufficient benefits for it to restrain it's own impetuous impulse so you start with normalization within that. All set of concerns would be on the table, Iranian has you know have their own set of concerns, economic penalties, frozen assets, lack of legitimization of the revolution and we have our concerns, nuclear issue, the Palestinian Israeli conflict, some sort of a coordination of policies toward the Gulf, so I mean I think in the final chapter, I said all these things would be separate tracks of negotiations, they will not necessarily be linked together in the sense that progress in one track impedes the other one or vice versa. And then you don't start out the negotiating position by demanding lack of enrichment capability, but you might get there at the end. So you sort of pick up the stick from the other end. Your goal and objectives in this context are sort of refashioning US-Iran relations. You start from the top and you work down as opposed to picking up single issues and getting obstruct in those detail. So I would start by saying that fine, you know there will be renegotiating by normalization of relations and within that we are going to have a lot of separate negotiations and on some issues we have sort of a Shanghai approach, we agree to disagree; on some issues we cooperate, but we have a sort of a matured framework, and at this particular stage where we are and where they are, we are essentially trying to regulate the rise of the Iranian power, you are not going to diminish it, you are not going to extinguish it, it's a remarkable thing but that's where we are. You know we actually in your actually there's a one paragraph that sort of sums up your book at the end, we try probably got here some place, but basically you say it's a, the Islamic Republic remain a problem to manage. That's very different from saying that this is a crisis that must be dealt with immediately. But there is real implications of that. Well for some Iran is a riddle, you sort of put in the right number and the door opens. I think Iran is not a riddle to be solved, it's not an emotional experience to be had. It's a problem to be managed. It can be managed more or less adroitly but it's going to always remain a prickly state, and it was during the Shaff time. I mean it was during Shaff's time it was probably for nuclear capability, during Shaff's time it was suggesting that the security of Persian Gulf has to be based on indigenous actors, no external powers or some there's this continuities with me some of the demands of the Islamic republic and some of the demands of the previous regime, but it's going to be as I said a problem to be managed and it has to be looked at as such as opposed to trying to get to an alliance or enmity, its just somewhere in between, it's the color of truth will be in the grey zone. You know our management capabilities have been less than perfect than in recent past, then I think that's, that maybe asking for a lot, though if it's one would hope, go out and vote. Okay. Not taking sides. In your book, it was mostly written before the war this summer the some of the Israel Hesbolah war, and although it's included you did or do an analysis of it, I wonder if anything that happens this summer between Israel and Hesbolah led you to have additional thoughts if not second thoughts about different aspects if you? Almost everything that has happened since 2003 has constituted a further empowerment of Iran. With a demise of permanent demise of the pre-invasion of Iraq, Iraq can no longer offer a balance to Iranian power in the gulf with a sort of a triumph of Hesbolah of this political triumph, I mean at the end of the day, the Hezbollah defended their villagers better than Nassar and Saddam defended the seats of Arab civilization, back then in Cairo. So that there is a sort of perception of triumph among Hezbollah which we down to some extent to Iran's advantage and gives Iran a voice and deliberations beyond its military capability and beyond its territory. So the events that have happened have made Iran more empowered but that doesn't necessarily mean Iran's vulnerabilities have disappeared, it is still a state that requires integrations in a global economy, it is a still a state that at some point has to have some sort of rational approach to the United States, if it wants to be a major power in this own region, again can Iran become a major power a preeminent power in the Gulf in defiance or aprobation of the United States, those are important debates. So but certainly they feel stronger than I think I ever seen them, and - the United States goes into these negotiations potentially in a position of disadvantage, which is rather remarkable because Iran's GDP is $117 billion, United States defense budget is 500, but we are in a position of weakness, and it tells you about mediation of power in 21st century, it tells you about how the psychological environment has changed in the Middle East and certainly in the US-Iran relationship. Well there is in that overall history which we've only touched on here slightly is there are plenty of cases of unintended consequences that flowed from people's policies and I think recently we didn't intend it to be this way but our intervention in Afghanistan first and Iraq second and getting rid of Iran's two greatest natural enemies together with installing a Shia government for the first time in Iraq has empowered Iran to a degree that is really extraordinary and gives us a different kind of. And a loss of confidence in American judgment in the Gulf states. At this particular point the Gulf, certainly the Gulf population mistrust the United States more than Iran and the Gulf leadership, the princely class surprising enough tends to mistrust American judgment more than Iranian motivations, which makes it very difficult to have any sort of a resurrected balance of power in the Gulf, I mean the balance of time the Gulf is gone, I don't know what security structure would come about but it's a very different. I think its time for us to let other people get in on this conversation. As all of you are aware first of all when you do get recognized, wait for the microphone, standup, identify yourself and try to keep your questions brief and by the way I don't usually look at this audience from up here, and I must say that I wore my favorite tie today and I see at least 3 other people around the room which I think attribute to all of your good taste, I just wanted to compliment everybody so John, could you wait for the microphone please.
member. 
