08/10/2012 Newsnight


Scoring George Osborne's chancellorship. Boris Johnson at Conservative Party Conference. And is Iran crumbling? With Jeremy Paxman.

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Two-and-a-half years into a Government that promised to sort


out the economy and things are not only no better, but in some cases


they are much worse. The Chancellor of the Exchequer won't change, he


won't even change his slogan. nation working hard together, we


are still, all in this together. All these words in his speech and


not a single mention of the "g" word, "growth".


By Christmas we will know if the Chancellor has met two tests he set


for himself to turn around the economy. If he hasn't met them,


there will be mitigating circumstances, but he will be


weaker. The main event of the day at the Conservative Party


Conference, Boris Johnson shows up. If this is the moment life begins,


maybe abortion is murder, but if it isn't, what is the date when


abortion should become illegal. Campaigners on all sides of the


argument are here. Unrest in Iran, as inflation heads


sky wards and the economy plunges, is it possible that international


sanctions are working. When he appeared at the Olympic Games they


booed him. At least that didn't happen to him today, but he was


speaking at the gathering of his own political party members. He


spent over half an hour reassuring them he knows what he's doing,


despite the fact that a Government who promised to sort out the


economy is preying over a massive growth in public debt. We are all,


apparently, still in this together. Allegra Stratton was there, and she


was all ears. The speech was actually quite flat


today, five years ago, you have to remember, ago was when George


Osborne brought out the inheritance tax policy, and it stalled Gordon


Brown's plans for a general election. He got his reputation


there for being Houdini as Chancellor and politician, we are


asking the question a few years into the Government if he still has


that, and the opinion is mixed. You could say on his own tests he has


failed. Two tests set at the beginning, he would eliminate the


structural deficit by 2015 he has delayed that by two years. And the


other thing is debt as a proportion of GDP would be falling. Again, it


looks like, we are not certain, that will also not be met. The


problem for George Osborne is not now, but in a few weeks time we


will know that for certain. Therefore, he has to face the


prospect of two of those targets not being met. All of the above is


failure, I do think it is a mark of the man that he has given himself


the political space to be able to do that and get away with it.


Remember when he announced he was delaying that rolling fiscal


deficit reduction target, he got away with that with remarkably few


scars. I think, firstly, the Labour Party is likely to accept at the


next election that they agree with coalition spending plans. You have


to, he has failed, on his own terms, but he has given himself the space


to create new terms. It is politically clever, the economics


not so good. Did he restore any political


reputation today? No, today was a flat speech, a few policies in it.


Very interesting for people like me. In terms of the mega-headlines,


they didn't cut it, and didn't do enough, apart from a few clap lines


on welfare. People here really like that, they like the �10 billion.


Apart from that he didn't do enough. The main event for the Chancellor


is in a few weeks time, when the Office for Budget Responsibility


pronounce whether he makes that next cut.


Thank you. The promise coming into Government of a return to growth


has, so far, proven a miserable prediction. Despite this, the


Chancellor still wanted to sound optimistic today. But does he


deserve to be? We have been looking at his record, and outlook.


Around Westminster and Whitehall, at least on paper, the Chancellor


is known by his initials, you suspect he rather likes this H it


suggests action, positivity and progress. Unfortunately, the


economy hasn't been nearly so dynamic, economic growth isn't so


much as G-O, as G-O-N-E. The Chancellor's job today in speech


was to explain why the recovery was so much harder than he predicted,


and to convince voters he still knows what to do. The truth is s


that the damage done by the debts and the banking crisis was worse


than we feared. The rise in the world oil price has been larger


than anyone forecast. Sadly, the predictions that you made, that I


made, that almost everyone here made, about the euro, turned out to


be all too true. This makes the job more difficult. But it doesn't make


it any less urgent. We all know we have economic problems, the


Chancellor today, like Ed Miliband last week, was trying to define


exactly what the big problem is, and therefore, what we need to do


about it. Labour see the big issue as growth. Therefore, we need to


stop austerity, or at least slow it down a bit, until growth returns.


George Osborne, on the Conservatives on the othered hand,


wants to show the big problem we face is too much borrowing,


therefore, the last thing we should be doing, they say, is reining back


on austerity. We need to keep going, with deficit reduction. Because the


Government has missed its deficit reduction targets, it is having to


outline new cuts and tax rises going into the next parliament. �16


billion worth in total, �10 billion to come from welfare cuts. For, the


Chancellor said, a very simple reason. How can we justify the


incomes of those out of work, rising faster than the incomes of


those in work. How can we justify giving flats to young people who


have never worked, when working people twice their age, are still


living with their parents because they can't afford their first home.


APPLAUSE About �3.2 billion of the new


deficit reduction will come from tax rises, but where from? One


place they are not going to come from, said the Chancellor, is from


the Liberal Democrats' preferred mansion tax on properties worth


more than �2 million. It would be sold as a mansion tax, but once the


tax inspector has his foot in the door, you would soon find most of


the homes in the country labelled a mansion. Homes people have worked


hard to afford and already paid taxes on. It is not a mansion tax,


it is a homes' tax, this party of homeownership will have no truck


with it. The leaflet the Conservatives were


giving out today claimed the coalition had already reduced the


deficit by 25%. The Chancellor even said so in his speech. The deficit


is down by a quarter. In fact, he said it twice. Yes, we have cut the


budget deficit, by a quarter. only way to get to a figure of near


25%, is to stop counting at the end of the last financial year. Because,


since then, the public finances have deteriorated sharply. If you


include this period in a rolling 12-month total, well the reduction


is only something like 18%. Even this might be overgenerous to the


Chancellor. If you change the way of counting the deficit to the one


preferred by many economists and used by the Office for National


Statistics. It is called the current budget balance, and it


ignores capital spending. On this measure the deficit peaked at �110


billion in 2009/10, it dropped to �59 billion lasty, but on a holeing


12-month total it is up to �108 billion. A reduction not so much of


25%, how does 2% sound? Whichever way you slice it, there are big


questions for the Chancellor. this December in his Autumn


Statement, it looks like the independent Office for Budget


Responsibility, will tell him at least one of his fiscal rules won't


be met. We didn't hearing anything today about how he will respond to.


That one of the biggest questions for him, and one of the most


interesting issues for the economy and the public finances, will be


now will he respond in December, when the OBR tell him, actually, on


your current plans you are not going to meet the rules you have


set yourself. There is more bad news for GO


tonight, as he heads for a meeting of European finance ministers


tomorrow, in the last few minutes the IMF have published updated


growth forecast, with the UK growth prospects sharply devised downwards


for this year and next. To discuss his boss's performance,


the Treasury Minister David Gauke joins us from Birmingham. David


Gauke, you promised when you came into power you would sort out the


economy, instead of which you are borrowing more thanth year than


last year, growth forecasts are downgraded tomorrow, and we are


back in recession. Shouldn't he have apoll goised today? Well, --


Apologised today? Well, no, the situation is clearly difficult for


the economy in the UK, as it is in pretty well other developed economy.


The fact is, that the eurozone has created great uncertainty t the


damage done to the economy in 2007/8, by the financial cry sits,


was more severen -- crisis, was more severe than anyone had thought.


Add into that commodity prices have been high, that has made growth


much more difficult. That is the essence of the problems we have


faced. But this is a Government that is determined to address those


problems, and make us more competitive and get growth in the


economy. It doesn't sound like a Government that is determined to


control things, he sounds like a passenger at the back of the bus?


No. Clearly there are international factors, and, you know, Government


has to deal with those. We are not powerless in the face of some of


those international pressures. Clearly it is more difficult in


terms of getting growth in an economy, when we're seeing many


other economies in difficulty. The eurozone is clearly a major crisis


that we have to deal with. We are doing everything we can to get


growth, that is why we have measures on planning, on employment,


that is why we are concentrating on getting more infrastructure


spending. That is why we're taking steps to get funding for businesses.


There are difficult circumstances. We accept that, but it doesn't mean


we should abandon our attempts to get control of the public finances.


That would be extremely reckless thing to do. He seems to think some


of it is our fault. He said today there was a need for people to be


working hard, as if we are not. How many people in this country are not


working hard? I think the point he was making is a much bigger


challenge for countries like the UK, indeed all mature western


democracies. At a time when there is greater competition, when other


economies are rising, that creates great opportunities, new markets


for us to exploit. But if we sit back, if we are complacent, and we


don't respond to the challenges, the future for countries that do


that, is not particularly a happy one. That is why you have to take


some of the, quite tough decision, to ensure we get growth in the


long-term. It sounds to me that the person who ought to be working


harder is George Osborne? We're all working very hard in terms of


delivering policies that will make us more competitive, putting us in


a position for stronger growth in future years. That is a big


challenge we all have to face up to. That is why we're bringing forward


proposals that may be tough and difficult, like welfare reform,


that is why we are more demanding of our education system, and want


to put standards up higher. That is why we have to have a competitive


tax system. All those things are really important, that is what the


Government is focusing on. couldn't even stick to a line on


tax on Cornish pastties and caravans, could he? -- pasties and


caravans, could he? These are measures we listened to what people


had to say and changed policies. It is hardly fundamental to the


position of this Government, in terms of bringing through some big


spending cuts, getting control of the deficit at a very difficult


time, and ensuring that we have credibility. We have goat


credibility, that is why the markets allow us to have interest


rates as low as they are, and we are determined to stuck to that


course. There are Governments who in these circumstances would give


up and walk away and abandon that hard-won credibility. That is not


what we are going to do, that is not what George Osborne is B we are


determined to ensure that we succeed -- is about, we are


determined to ensure we succeed and press on. Your Government says


there is about �16 billion of cuts to come, you have also said the


cuts will be divided between cuts in public spending and rises in


taxation, about a ratio of 80%-20%. Correct? That means you have �3.2


billion in extra taxes to raise. How will you do that? Obviously any


announcements in terms of taxes will be made at budget or Autumn


Statements. I would make the point in every budget so far we have


raised more from the wealthiest in measures like capital gains tax,


stamp duty, land tax. We have taken measures to deal with avoidance. We


have capped reliefs, we are prepared to share the burden around,


so those with the broader shoulders share the greatest burden. That


80%-20% split has taken over the whole financial period. The


important thing is we don't tax ourselves into an uncompetitive


position, and most of the academic evidence suggests that most of the


focus should be on spending cuts, that is what we are delivering.


As you know, your boss is a very unpopular man. When he appeared at


the Olympics, people booed him, do you like him? Yes. I have worked


for George for five years, he's a very good guy to work for. Why do


you like him? Because he's very thoughtful, he's committed to doing


what he can for the country. He's very, very bright. He wants to


serve the country to the best of his abilities. Actually, at a


personal level, someone to work with. He listens, he engages. He's


the sort of boss that most people would want, I would say. You think


the public will come to love him? think for any politician to hope to


be loved, I think, is perhaps a little hopeful, I think he's


someone who should be respected. I think he's doing an excellent job


as Chancellor. The most excitable crowd at the Tory Party conference


was not surrounding the Chancellor or the Prime Minister, but swirling


around a man not even in the cabinet. Whatever popularity


politicians have, Boris Johnson, the Mayor of London has got it. He


says he's there to support the party conference, but he hides his


ambition in the same way Eric Pickles could claim to be a hurdler.


Boris is the friend without whom life would be a lout easier for


David Cameron. The thing about mayor's with blonde hair, one of


the country's most famous mayors was famous for an orchid stuffed in


his Labour party pel. He made Birmingham go Zong. He overhauled


the housing supply and the systems, Birmingham is used to nurturing


mayors on to other things. Another one rolls into town in an hour. The


Conservative's Prince across the water, today waded into Birmingham.


This is as close as I will get to be in the paparazzi, we are waiting


to get into Boris Johnson's slip stream, without which we have no


chance to get close to him. Down there, cabinet ministers are having


cups of tea without being bothered. It used to be the leader's speech


that was the big thing, today it is Johnson I don't know who is the


belle of the ball. A belle of the ball, featuring in a welcome video,


made to warm the crowd up, ahead of the entrance by the real thing. At


one point, one could hardly move along the thin corridors in


Birmingham, the question for Boris Johnson is how much can he say. You


can talk about winning 2012 elections in London, a notoriously


hard city for the Tories. But how to win an election in 2015, is too


close to the bone for David Cameron. Within moments it was clear he came


to praise David Cameron, not to bury him, even a tiny bit. It is


sometimes inevitable that a Major of a great -- Mayor of Great city


may find himself that are at variance with national policy S of


course, I'm stkpwoing to continue to lobby for a long -- going to


continue to lobby for a long overdue answer to our capacity


problems. But no-one as a result of that should have any cause to doubt


my admiration for David Cameron. But an airport is the licensed


disagreement. That morning Boris Johnson had writ on how the middle-


classes -- written on how the middle-classes were shut out of the


housing market. It is close to a denunciation of his party's


strategy. There are many thousands of people who are the motor of our


economy, who can't afford get the housing they need in London. They


are not the people who normally qualify for affordable housing,


they are on �34,000-�64,000. By the end the Johnson jingoism was


employed in support of the coalition, not against it. If the


Government goes the way it is going, sticks to the programme, doesn't


get blown off party, remains a one- nation party, plonked squarely in


the middle of British politics. Prime Minister's head of


communications was watching closely When the economy improves and


people feel it, I think that people are look back at the tough,


pragmatic, responsible decisions this Government took, and say they


were on the right lines. As much as Boris Johnson can be, that was a


are strained performance for him. Clever tactic, dampen the


expectation, but please the activists, they know, he's still


the one they really love. Right now there is no vacancies for Boris, or


cadidacy for Boris. But if things don't turn around, the


Conservatives may find there is a necessity for Boris Johnson. The


Conservative Party party is acidously not discussing something


which very large numbers of the general population have strong


views on. In that, perhaps, they reflect the general hypocrisy of


the British people. The topic is abortion, it was illegal until the


1960, the argument isn't about the principle of termination, which


most people seem to agree with, but with the date up to which it is


legal. The Health Secretary thinks it should be reduced from 24 weeks


to 12. When it comes to abortion, they are


about Assenor a bunch of politicians as they come. Prime


Minister, Women's Minister, Home Secretary, all on record as


favouring a reduction in abortion limits from 24-20 weeks. The Health


Secretary would go even further, and bring it down to 12. None of


these are new views, all four politicians voted to lower the


limit, last time parliament debated abortion. What has changed since


the 2010 election, of course, is the voting complex of parliament as


a whole. It is problem safe to assume, it hasn't become any more


hostile to lowering the limit. Babies born before 24 weeks will


only survive if they have help with their breathing, if they have


intravenous nutrition, and a lot of other very demanding, costly and


challenging treatments. Dedicated staff, and an important price of


survival is that the baby's suffer a lot for many weeks. In Sweden,


the latest evidence shows that a survival of 53% is possible at 23


weeks, and 10% at 22 weeks. But this is only in a country which has


probably the best social and medical conditions in the world.


The woman who heads one of Britain's leading abortion


providers, says people are not getting a clear picture of the


latest evidence. Because all sides use it to help make their case of


the One small study does not a huge body of evidence make. When I want


to know about what's going on, with the survival of severely premature


babies. The people I would be asking are the neonatologists, who


work in those areas. My understanding at the moment, is a


lot of those professionals are concerned that the public has an


overly optimistic sense of survival rates. Rather than the other way


round. 12 weeks is best known as the time


many women have the first scan. It is also the point at which the


Health Secretary would like to see abortion limited. The logic of the


12-week limit, is because that is the time when the foetus has


completed oregano genesis, there is some logic in fixing the


termination at that gestation. It is used in Europe-widely, the 12-


week limit, for social terminations, in countries such as France they


will allow later abortions for severe foetal abnormalities. That


is the way we should go, in this country, I think. It is true babies,


the vital organs have been formed by 12 week, and the feet tus are


able to move around, and -- foetuses, are able to move around


and so on. Evidence from neuroscenes does not suggest that


the foetus is conscious or able to feel pain at that time. Impressive


advances in ultrasound images, particularly the latest 3.D scan,


which means we can see more, and opportunities for bonding between


parent and child. The vast majority of abortions in the UK take place


before 12 weeks, close to 175,000 in 201, 91%. That same year there


were 14,000 abortions between 13-19 weeks, and just over 2,500, about


1.5%, between 20-24 weeks. Very few women are seeking abortion after 20


weeks of pregnancy. Those that do have got really good reasons for


doing it. Sometimes it's that a test has indicated that their baby


will be born with a disability that they don't feel they can imagine.


Sometimes they didn't realise they were pregnant sometimes they are


very young girls concealing the pregnancy from their parents.


Sometimes it is women whose periods have stopped, and it never occurred


to them that it could be because they were pregnant. I have seen


these case his trees, I'm not really convinced by -- histories,


I'm not really convinced by most of them, maybe one or two. I don't


think we can let the exceptional case drive the whole question of a


reduction of the abortion limit for the majority of women who come for


termination of pregnancy. For many, focusing on the number of


weeks at which to set the abortion limit, misses broader questions


that should bring a fresh look to the old debate. While it is clear a


12-week limit would get short shrift in parliament, any lowering


of the limit down to 22 week, is less easy to call. With us to


discuss the issue is Guardian columnist, Zoe Williams, Patricia


Lohr, and chief executive of the Christian Medical Fellowship, and


campaigner, Kathryn Attwood. To what is a reasonable lowering of


the time limit? Of the 16 story Tory members of the cabinet, 13


voted in 2008 for it to come down. To what? 7-20 weeks, 2-16, 3-12,


the European average is about 10-12 weeks. What do you think it should


come to? I would like to see it come down substantially. To what?


I'm opposed to abortion myself. Full stop? It is against the


hypocratic oath. We should be moving much more in the direction


of Germany, which has a 12-week limit, and an abortion rate 0% of


our's. In an ideal world no abortions at all, you are an


absolutist? I'm opposed to abortion, personally, myself, yes. I said


that most MPs are not, but it is these amazing 4-D ultrasound, and


the new information about foetal sentients, and babies surviving


below 24 weeks, it is changing the opinions of many. What do you


think? If we really want to look at the evidence, the facts are these.


Foetal vaiblt has not reduced, even in places where we have viability


has no reduced, even in places where we have the most care. There


are no adverse health outcomes for the woman, psychological outcomes


from the woman. And abortion is far safer than childbirth, even in


places, again, with very advanced medical system. I think that this


is the evidence. But most importantly, these are not


decisions where people are necessarily weighing up scientific


evidence. That is very important when people are facing a very


premature birth, when there are serious medical health conditions


involved, but for most people considering an abortion, it is


about whether they are personally ready, whether they are financially


stable, whether they are psychologically ready to bear a


child or become a parent. Why do you think this has suddenly become


topical, then? I know exactly why. It is nothing to do with the time


limit on abortion, there is no way Jeremy Hunt will try to bring it


down to 12 week, if he did, nobody would vote for it, it would never


get past private members' stage. The reason he's doing it, is as


Tories member do, throwing a sock to the right of the party, using


women's issues as their territory, which is very irritating. I'm very


pro-choice, I think your position is slightly illogical, if you are


anti-abortion, it doesn't matter when the abortion take place. If


your aim is to bring the number I have a borgss down, as you saw, you


won't priing -- abortions down, as you saw, it won't bring them down


much. You think an upper limit? don't think the streets are full of


women trying to abort at a late stage. The logic of your portion is


there would be -- portion, is no upper or lower limit. If you lock


at countries without any upper limit, like canned dark you don't


find people in the third trimester looking for an abortion. You would


be in favour of an upper limit? don't think you need a limit.


any kind? I genuinely feel you wouldn't find people seeking an


abortion at a late stage, no. do you think it is a topical issue,


suddenly? I agree that politicians are trying to create some sort of


debate. I think it is great there is some sort of debate about the


subject. It is important to bring the debate to the surface. What do


you think? Agree with Peter, if we are talking about pre-born babies,


lives starting with conception, all abortions ends the life. You are


against all abortions? If every abortion ends the life of a human


being, I disagree with all abortions. We have two


diametrically opposed opinions, no sense of a political compromise,


morally you take a position, they are diametrically opposed, that


life, as you see it, is sacred, and you say choice is sacred? I'm happy


to compromise at 24 weeks. That is where we are now. Presumably you


were compromising at 28 weeks? Probably, yeah. Adorgs is legal


right up to birth of disabled babies in this country. Six out of


ten women think the rate should come down. The reason why people


are changing their minds has all to do with the humanity of a baby.


That is a 12--week-old baby. It is not, it is a model of of a 12--


week-old baby? It is, it is a mottle of a 12--week-old baby, we


know from Stuart Campbell's ultrasound, that these babies kick


and twist in the womb at this stage. The data about foetal sentients in


your early programme, is hot low disputed. There are a lot of


neurophysiologyists and nutritionists who feel baby can


feel pain and sense touch much earlier. There was a leading piece


in a paediatric journal, which called a report from the royal


colleges on foetal sentients and then with no clothe.


He is misrepresenting the best data. The best data we have on foetal


pain is that the neuropathways don't develop completely until 28


weeks. That is hotly disputed. There is not evidence of whether a


foetus will experience pain when it is not outside the room, and it is


not conscious in utero. The ability to feel pain doesn't mean value as


a human being, it is because we are humans. It is not about value as a


human being, the argument you are making, every woman who finds


herself with a pregnancy that she did not anticipate, goes through


the thought process of whether or not she's actually ready to


continue that pregnancy, and become a parent. That is where the


humanity discussion? She's already a parent if she's pregnant.


that becomes an issue. Do you consider yourself a parent as a


pregnant woman. I'm in a situation where I'm in a stable relationship,


financially stable, I'm psychologically to have a baby, I'm


thrilled to have this baby. Whether it is a human life worthy of


respect or not, depends on whether you want it or not. Its value is


dependant on whether it is wanted, is that what you are saying?


point is that people who have children are the same people who


have abortions. But their pregnancy at different times in their lives


means different things to them. And people are more than capable of


thinking about what's most appropriate for a potential child


at any point in their lives. child with potential. Those things


have very little to do with how much it look like a human being, or


whether the organs are formed. would agree with you, I would think


whether it seems like a human, doesn't mean it is human or not, it


is human by the fact that its both parents are humans. Surely all


humans have a certain value no matter how big or old they are.


I ask, your position, presumably, is at the point of conception that


it becomes a human being. Is that a Christian position? It is a


scientific position. You might as well say an egg is a human egg.


egg on its own. Everything is pee tension human being. An embryo is


an actual human being. I think this is a faith thing. Doctors abided by


the hypocratic oath, and the BMA doctors of all faiths and no faith


at all. On the basis that a human embryo, a human foetus was actually


a human being with potential, rather than a potential human being.


Do you mean to say the BMA opposed abortion? I'm saying the BMA in


1947 called abortion the greatest crime, the BMA, they did.


Jo you will find things have moved on a bit since then. Clearly the


medical profession has moved from rational to irrational positions


through time. The latest worry story about Iran is the Islamic


Republic could have produced enough weapons-grade uranium to arm a


nuclear bomb within four months, but it would take longer to make a


warhead. The die hards in Israel say they will do what they have to


to protect themselves. In Iran there are increasing signs that the


economic sanctions on Iran are taking effect, there are shortages


of everything inside. Autumn is bringing a bitter harvest


to the streets of Tehran and other Iranian cities.


Prices are rocketing. Many food stuffs by between 40-60% in four


months. And diesel fuel, following the removal of Government subsidies,


has quadrupled in price. People are reporting to newspaper, to TV


programmes inside, that they have stopped purchasing meat. They have


dropped daily products from their weekly consumption and purchase.


As a result of this crisis, Iranians are coming to terms with


poverty, unrest, and growing polarisation in the country. While


hardliners blame foreign plots, and reformers call for change,


President Ahmadinejad's hold on power is starting to appear tenuous.


Iran is under severe economic pressure at the moment. The


currency has fallen by 40% in the last year alone, and 75% in the


last year. It is a serious crisis for the Government, and people are


suffering as a result. Whatever hardship the Government's economic


policies may have caused, there is growing evidence that foreign


sanctions are adding to the crisis. Dramatically so, according to one


student in Tehran we contacted tonight. I think madness about this


atomic programme has brought us to our knees. Especially sanctions.


With each new sanction the price of the dollar rises in the bazzars of


Tehran. I think people see it as a political problem. And, it is a new


oil boycott that seems to be having the biggest effect.


The export of oil in Iran has fallen to below 800,000 barrels a


day. Just four months ago it was more than 1.5 million. In that


context, sanctions have been quite effective. And the impact is


beginning to show theself in terms of reduced availability of foreign


currencies in open markets. And the ability of importers to continue


financing their purchases. international squeeze began in


ernest with UN sanctions imposed in 2010, on banks, shipping companies,


and other businesses tied to the Revolutionary Guards. The banking


sector was hit again earlier this year, when the US froze broad


catagories of Iranian Government funds, and the EU shut several


Iranian banks out of the international banking transaction


system. In July, the EU oil embargo came into effect. That, combined


with US pressure on other countries, is already thought to have cut


Iran's oil revenues by 40%. More pain is on its way for Iran's


leader, the EU is about to extend its oil embargo to Iranian national


gas. The country's foreign currency reserves are being whittled away,


in part, supporting the Syrian Government. That's estimated to


have cost Iran $10 billion already. And President Obama is under


pressure, from his Republican challenger, Mitt Romney, to take a


tougher line still with Iran. I put the leaders of Iran on notice,


that the United States and our friends and allies, will prevent


them from acquiring nuclear weapons capability. I will not hesitate to


impose new sanctions on Iran, and will tighten the sanctions we


currently have. What many now wonder is whether


sanctions and economic crisis may achieve what years of diplomacy and


the threat of military action, have failed to do. The suspension of


Iran's nuclear fuel enrichment programme. From about the end of


2009 until April 2012 thisy, Iran barely met with the P56789 plus 1


that is the four Security Council powers, since April they have met


three times, in Istanbul and Moscow. They have returned to the table.


Sanctions have played a very big part in bringing them back to the


table. But the regime and the supporters in the security


apparatus still breathe defiance, recently they have threatened to


banish the UN from nuclear site. They may still eat their words, and


it might just be that sanctions cause that.


For this long stand-off, has certainly entered a you in phase.


We have with ous a Tehran-based journalist working for the Iran


state TV news networking and we're joined by Clifford May, from a


Conservative think-tank. Do you this -- think this shows sanctions


are working? It shows it is having an impact on economy. For them to


work you would want two things to happen, the Supreme Leader would


have to decide that it is not worth it to have nuclear weapons f it


means his economy and the -- if it means his economy and the people


will have to suffer so much. Or the people of Iran would say we can no


longer abide these rulers or the regime that doesn't have our


interests in their heart, but want to build nuclear weapons and


threatening genocide against Israel, we can't take this any more, and


you see a replay of 2009, with more support. If the purpose of


sanctions is to change the calculus, it hasn't happened yet. What do you


think has been the cause of this unrest in Iran? There was an unrest


on Wednesday, the fact is, the Government has been monitoring the


unofficial money markets, and there were a number of dealers who were


short-selling, a bit like Black Wednesday in Britain. Short-selling,


nothing to do with sanctions? Sanctions have affected Iran, the


price of goods are up 50%, the import of goods are up 150%. They


have affected Iran. But have they affected Iran to the point that it


should be on the knees? No, it made do with $3 a barrel during the


Iran-Iraq War. It won't work that way. The US would be better advised


to look at another solution for the Iranian problem. You see no


possibility of the sanctions forcing the regime to either


abandon its nuclear programme, as was suggested, or for people to say


they won't put up the -- with the regime? Well chemical weapons


shouldn't have been supplied to Saddam Hussein where it killed


millions of martyrs. This is completely irrelevant? They would


like their country to progress and proceed further. Also Iran's fossil


fuels, rate geem argument, -- regime argument. The regime


argument is a person feels finite. A good example of this is Saudi


Arabia can't come up with the surplus oil to make it work.


are looking sceptical? I think most Americans and people in the west


would love to see the Iranians, prosperous, free, living better


lives. We think Iranians, probably, are more capable of having a free


country and democratic society than perhaps any peoples in the Middle


East. Weish wished we could have good co-operation and progress. We


can't have that with the current regime. The negotiations have gone


nowhere, despite the sanctions we haven't seen a spirit of compromise


on the part of the Supreme Leader, or the IRGC. I think the sanctions


will have to get a great deal more harsh before the calculus changes.


Or before the economy, I'm sorry to say, collapses. There will be a


time at which I think there will be no foreign currency resources left


in Iran, that can be facilitated. I'm sorry, I find it difficult to


believe from a proponent of enhanced interrogation technique,


the Iraq War. That is nothing to do with T deal with the analysis?


find the goodwill a little hard to believe, and knowing which camp you


come from. Meaning you take great pleasure in going into countries


and rendering them like you did with Iraq. So let's stop that. Iran


will not come to sneeze, I tell this, the fact of the matter is,


the oil that oil and gas that you are saying you have placed under


sanctions, is continuing to be told. The solution, I was here talking to


Nick Burns a while back. The solution with Iran is understanding


Iran. I know hardliners, such as yourself, who present a friend low


face towards us u the fact of the matter is you have tried every


which way the last 30 years and gotten nowhere. You have to


reconsider your position, because pretence won't pay off with


Iranians. The fact of the matter is, while I


feel friendly towards the Iranian people, and wish I could visit. The


Iranian regime in power for 30 years has been a terrible failure,


the people of Iran are less free than even under the Shah. They are


less prosperous than under the Shah. Iran is the leading sponsor of


terrorism in the world, it is trying to develop nuclear weapons


while oppressing its own people. Not since the 2009 up rising


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