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Why Sanctions on Iran Are Also Sanctions on You

Written by Gary North on April 12, 2012

American voters who approve of President Obama’s sanctions on Iran should also approve of gasoline prices that are 25 cents per gallon higher than they would have been apart from the sanctions.

Economic sanctions are restrictions on trade. Restrictions on trade raise prices. There can be no economic sanctions imposed by the federal government that are not paid for by American consumers.

Blaming Obama for (say) $1.00 of price hikes is good politics and bad economics. Blaming him for 25 cents worth of price hikes is good economics but (in some circles) bad politics. There are voters who think that Iran deserves sanctions, despite the fact that Iran does not threaten the interests of the vast majority of citizens in the United States. These voters will bring political sanctions against Obama’s re-election campaign if he were to call off the sanctions.

This goes back to 1806. Jefferson imposed a trade embargo with both France and Great Britain in an effort to keep the United States neutral. The result was the first recession in the young nation. The embargo ruined New England’s economy.

The difference today is that most voters are unaware of the gasoline price “tax” imposed by Obama’s sanctions on Iran. In 1806, voters knew that Jefferson’s embargo was to blame for the rotten economy.

The sanctions which the U.S.A. and other nations have imposed on Iran’s energy sector and on its central bank are costing Iran about 300,000 barrels a day in exports. The sanctions have imposed something in the range of $10 per barrel of oil, according to some specialists in the oil market.

The sanctions on Iran are a subsidy to OPEC. The House of Saud is quietly ecstatic. “The hated infidels are paying more to Sunni Islam, while the even more hated Shi’ites are suffering. Allah is great.”

Because voters are untrained in economics, they are unaware of all this. This protects the sanctions program. If it were promoted as “subsidize Sunni Islam,” it would not be nearly so popular.

Saudi Arabians took down the trade towers in 2001. Iranians did not. Iraqis did not. The Taliban did not. So, who gets our sanctions money? Saudi Arabia.

Try to find any other analyst who connects these dots. I have looked. If he is out there, I have not found him.

I can see why the House of Saud applauds Obama’s decision. I can see why the Likkud Party does. I do not see why anyone else does.

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13 thoughts on “Why Sanctions on Iran Are Also Sanctions on You

  1. Victor Barney says:

    Not for nothing, but there is NOT MUCH difference between Iran, Islam, Marxism, and Obama! All represent DEATH and DESTRUCTION, AND UNLIKE ANGLO-SAXONS, THEY KNOW that WE REALLY ARE ISRAEL, as ENGLAND, by the seed of Joseph, NOT JUDAH(GEN. 48:16)! I find it very interestming that Obama, clearly the "FORBIDDEN FOREIGNER" over u.S. of Deuteronomy 17:15 because he is the "ONLY" LEADER OVER the REAL HISTORY OF ISRAEL(THAT'S A VERY LONG TIME BY THE WAY) that there ever has been! It's very clear! Eve & Cain had made a first-born blood covenant of death 6,000 years ago that is being forefilled RIGHT NOW before our very eyes! However, our CREATOR will rescue u.s. again with the two-witnesses of Revelation, chapter 11, who after 3 1/2 years of witnesssing, will leave 144,000 people left alive from all 12 tribes of Israel, less Dan(Irish) who first enterred America with the second group of pilgrims as "JESUITS" when ROMAN CATHOLICS WERE STILL FORBIDDEN ENTRY BY OUR FOREFATHERS, BEN FRANKLIN AND ALL! In fact, Roman Catholics could NOT EVER LEGALLY ENTER America until AFTER the Civil War! Did you even know that? Just saying…

  2. Why you shouldn’t smoke a bowl full before breakfast.

  3. Ha ha! I guess all those Irish who immigrated during the potato famine of 1845-1848 came here illegally. Wow. Whatever he's smokin', I want some!

  4. Taxes, Regulations, Fees, Tarriffs. Sanctions . . . they all sound great to economic ignoramuses who don’t understand that it all rolls downhill onto the consumer.

    Good column, Dr. North.

  5. “…Saudi Arabians took down the trade towers in 2001. Iranians did not. Iraqis did not. The Taliban did not…”

    Well, you know better than that. The CIA/Air Force/Mossad took down the three WTCs with two ‘planes.’

  6. Mr. North,

    The house of saud may well be ecstatic, but they were NOT the engineers of 911. Great analysis and observation on what happened that day in 2001 when our own government was at the very least, complicit:


    It is so diabolical it is as if satan was the plane “driver.”

  7. Bruce D. says:

    A nuclear Iran affects everyone. Iran's leaders make Iran a political/ religious/ suicidal nation. Nuclear fallout travels in the trade winds and can go anywhere. We will all have to be buying iodine tablets if you do not take them seriously. It also encourages a nuclear arms race in the world. There is nothing more dangerous than a world armed to the teeth with nuclear weapons. It is very shortsighted not to be concerned about that. Sanctions will not work with Iran. Israel should bomb the sites for their own protection and we should support that because a nuclear Iran is unacceptable no matter what gas prices go to.

  8. Bruce D. says:

    I do not believe that Obama's restrictions on coal and drilling for oil on public land does not affect the price of oil. If speculators felt that the U.S. had a credible energy policy that would lead to greater supply they would not be so quick to speculate on higher oil prices. Green energy is not credible and they know it. If green was credible oil prices would come down to make oil more attractive. Right now oil is the only game in town and Obama is doing every thing he can to stop exploration on federal territory.

  9. Bruce D. says:

    Another way Obama is keeping oil prices artificially high is that he uses regulations as a weapon to suppress free market trade and enhance government power over the private sector. Free markets need regulation to the extent of keeping them free, honest., and fair. Wall Street bankers are allowed to speculate with very little money up front on a $1000,000 oil contract. The risk of speculation is not in proportion to the profits that can be made and that allows them to drive prices.high with little risk. Why doesn't Obama who is the king of regulation pass regulations to put future contracts in alignment with a free and fair market. The answer is that is that he wants the system to fail in the short term to put in place a government with sweeping powers over the private sector. High gas prices is something that is useful to him in promoting his long term agenda. I think he would have preferred to keep the prices lower until after the election but he gets a free pass from most people and the media back him up on his Pinocchio stories.

  10. warmonger says:

    You cannot have it both ways. Sanctions against Iran or collaboration with Iran. I'll take sanctions, any day.

  11. Where were you when W was in ofice? Do you remember having a savings account getting 2 to 3 percent interest? All that went by the wayside when W got in office. War in Iraq and Afghanistan and no way to pay for it. All occurred during W's 8 years in ofice. Oh Yeah! near depression in America during W's reign. W's crony friends profitting(ed) from the wars.

  12. Bruce D. says:

    I am not a fan of Bush and voted for 3rd party Buchanan the first time around so I have no idea what you are talking about.. That being said I made a lot of money during the Bush years but no one is going to put it in your pocket for you. There were at least five unbelievable years of investment prosperity and expansion. The Iraq war, medicaid, and the debt made Bush an extremely poor president. I was a supporter of the Afghanistan War but I thought Obama should have pulled out the day after we killed Bin Larden. You cannot let people come in and airplane bomb the shit out of you without consequences. Anything Bush may have done wrong doesn't excuse Obama's failures, expansion of debt, and government power grab.

  13. The Tea Party movement just showed their true colors with this article. They are agents of the Iranian government (a treasonable and hanging offense). No wonder all their children are in the streets protesting. They are afraid to join the armed forces and defend their country. But, they will defend the Iranians. Patriots, not a one in the Tea Party.