Where Does Iran Go From Here?

On this week’s episode, Israel Policy Forum Policy Advisor and Tel Aviv-based journalist Neri Zilber hosts Naysan Rafati, senior Iran analyst at the International Crisis Group. They discuss the ongoing protests across Iran against the regime, the strategic indecision by the Islamic Republic especially since last year's 12-day war with Israel, the prospects for miscalculation between Tehran and Jerusalem, President Trump's threats to 'come to the rescue' of the Iranian people, how the events in Venezuela impact Iran's thinking, and more. 

Chapters

• 0:00 Introduction
• 5:01 Demonstrations in Iran
• 17:00 The Response From the Islamic Republic
• 21:30 The Effects of the Past Two Years of War
• 35:07 Leadership Issues and Decision-Making Paralysis
• 41:00 The Threat of Iran's Ballistic Missiles
• 56:31 The Impact of the Events in Venezuela

Transcript

Neri: 0:04

Shalom and welcome to the Israel Policy Pod. I'm Neri Zilber, a journalist based in Tel Aviv and a policy advisor to Israel Policy Forum. Happy New Year to all our listeners and viewers, and what a new year it's already proving to be. Hope the various holidays were enjoyable for all of you, but we're now back to regular programming. And back with us this week is Dr. Nassan Rafati, the senior Iran analyst at the International Crisis Group in Washington, to talk about what should have been the biggest news of the current moment before Venezuela. But trust me, it's still very big news. Nassan, of course, was previously a postdoc fellow at the Iran Corporation, the U.S. Institute of Peace, and the IFRI think tank in Paris. He also holds a doctorate from Oxford University, and is, more importantly, a friend of the pod and a dear friend of mine. But let's not hold that against him. Nassan and I discussed the unrest rolling Iran with over a week of protests and demonstrations across the country continuing against the regime. And we tried to answer three questions. Basically, how serious of a threat is this really to the Islamic Republic? What does President Donald Trump mean when he says he'll come to the Iranian people's rescue? And should we be worried that another Israel-Iran confrontation is in the offen? All that and much more coming up in what was a terrific conversation. But first, a few quick thoughts from me. So we're recording this on Monday night Tel Aviv time, January 5th, 2026. The start of a new year, and you may be shocked to hear that nothing has really been resolved since some of you went on holiday a few weeks ago. Trust me, I'm not bitter or jealous, but uh nothing has really been resolved since uh, well, the end of 2025. Benjamin Netanyahu had a great visit to Mar-a-Lago last week to meet with President Trump, who showered him with praise. Trump said Israel wouldn't have survived without Netanyahu at the helm. Fine. Uh, and for Netanyahu and his wife Sarah, uh, their big hit and thrill was uh the invitation to Trump's New Year's Eve bash at Mar-a-Lago. So all of this was mana from heaven, really, for Bibi as he enters into an election year back home here in Israel. But the real question is what was decided between Netanyahu and Trump, and between the US and Israel, with regard to the various other fronts still in play across the Middle East. So, in particular, we're talking about Gaza, where we're expecting some kind of announcement in the next week or two, so very soon, on the ceasefire agreement and the so-called phase two of the deal that was struck back in October. There's still a lot of things to uh work out, shall we say, uh, with regards to phase two and next steps in the ceasefire. Um, believe me, there's still a lot to work out, uh, but that likely won't stop the Trump administration from announcing some kind of movement and some kind of progress, including most likely the announcement of a Board of Peace and an executive committee, and a committee of Palestinian technocrats who are all set to run the Gaza Strip. Now, what these various bodies will actually do on the ground and what they'll be able to do on the ground, uh no one actually knows yet. Trust me, I've uh tried to find out. Uh, that's number one. Number two, in Lebanon, the ceasefire isn't going all that much better. Uh, Hezbollah has yet to fully disarm. The Lebanese government is still, for its part, treading very lightly when it comes to disarming Hezbollah. And Israel continues to basically strike across the country on a daily basis at will, including earlier today. Uh, Trump in Mar-a-Lago last week said something that actually uh caught my ear and was quite striking on this issue of Lebanon. Uh Trump said that Hezbollah was, quote, behaving badly. Not that Hezbollah may be behaving badly, or that if Hezbollah behaves badly, then X, Y, and Z will happen. Trump stated it as fact. Now, out of all the various fronts currently still in play in the Middle East and well, all across the world, this is the one that many, especially here in Israel, uh, are most concerned about in terms of potential escalation uh in the near term. So just FYI, uh the pros here in Israel are uh, well, everyone's talking about Gaza and other places, but Lebanon may be the actual uh shoot-a-drop in the near term. And finally, and obviously there's uh Iran, but for that, let's get to Nasan Rafati. Hi Nassan, welcome back to the podcast.

Naysan: 5:03

Thank you, Derry. It's great to be back. Thanks for having me.

Neri: 5:06

Uh it's really our pleasure, especially this week of all weeks, uh, Nesan. Uh by the way, happy 2026 to you, such as it is.

Naysan: 5:13

Uh such as it is, yes. It's uh, you know, the Iranian year uh runs through March, but uh it's already been a rough one for the uh Iranian government.

Neri: 5:22

Yeah, uh rough one for the Iranian government, uh I think a rough one for the Venezuelan government as well, which we'll uh obliquely touch on, I think, later on. The Jewish New Year obviously started a few months ago. Uh I don't know if, you know, uh it's a better Jewish New Year, I suppose. So there is that silver lining. But a lot to discuss on this episode. And before we get into the Israel and the Trump and the maybe Venezuela of it all, uh, I really wanted to start here with the most kind of basic table setting exercise uh to explain to us, both me and our listeners and viewers, basically what's been happening in Iran over the past week, since I believe last Sunday, um, in terms of the unrest, the demonstrations that we've been seeing uh on the streets of Tehran and many other uh places all across the country. Uh what's been happening and also why now?

Naysan: 6:11

Thanks. Um well, as we're speaking right now, uh we've just entered the second week of uh these nationwide demonstrations that started with an economic spark. Um the Iranian economy writ large has been in a very difficult position, and particularly towards uh late December, there was essentially a free fall of the national currency with the the Iranian real kind of tumbling through a million real to the dollar to 1.1 to 1.2, it's currently 1.4. And for context, when the current president of Iran, President Pazesh Gyan took office in mid-2024, it was 600,000.

Neri: 6:49

Oh wow.

Naysan: 6:50

And so that sparked um the the initial round of of demonstrations and and strikes in the in the Tehran bazaar. But as has been the case in other rounds of Iranian protests over the past uh decade, what starts from uh uh particular agreements or a particular uh issue, whether it's economic or social, um, it quickly kind of evolves into a into a wider kind of demonstration of protests against the system, demonstrations against uh the Islam Republic. And so over the past uh week, we've seen um the rise of protests around the country. We've seen state security forces respond um with force in many instances, at least 20 fatalities uh reported. And uh I think your your listeners and viewers will will know that Iran has uh not been a stranger to these protests over the past decade. You know, in 2017, late 2018, 19, and then again in 2022, uh we've had you know various rounds uh sparked by by particular um incidents, but quickly kind of emerging into uh significant kind of challenges against the state uh from below.

Neri: 8:01

And that's a good jumping off point. I mean, give us some context, right? So you're saying the current unrest, the current demonstrations are entering their second week. Um we're recording this again uh Monday night Tel Aviv time, uh noonish DC time where you're situated Nissan. But uh how does these protests compare to previous protests, whether in 2022 or the previous ones even to that, the economic ones, or even the 2009 so-called Green Revolution or Green Movement, which came after a well, stolen election in Iran, which uh seemed you know fairly significant just in terms of the size.

Naysan: 8:38

Yeah, I I don't think that at this point, as of recording, uh, you know, the numbers are are anywhere um approaching 2009 levels, but I think that you know th there's an element of uh a regime playbook whenever these protests come up, which is on the one hand to say uh we recognize that there are some grievances, and you know, even in the past week, uh President Pazeshkian, even Ayatul Khamenei uh Khamenei, the Supreme Leader of Iran, etc. have said, yeah, the economic situation is not great. We understand that we'll do what we can, we'll try to increase uh handouts, we'll try to address mismanagement and corruption. Um, but and and you know, in in 2022, you know, even Khamenei after the death of Masa Aminy said, oh, you know, this was terrible. But that kind of uh rhetorical flourish and and you know nod to some of the grievances that give lie to uh these different protests is also accompanied by uh drawing the iron fist and and you know repressing these these protests. And um for all of the rhetoric around you know, the you know, we we are we feel your pain type of rhetoric coming from the top, the the grievances accumulate, right? They're not really addressed at any significant point. So whether it's the economy right now, whether it's the social and political um repression that uh people have um uh demonstrated against, um, the system doesn't really make any major course adjustments. It it uses uh repression and then um essentially tries to buy time and space. And as a result, we see these almost metronomic um um ebb and flow of these these protests, especially over the past decade, where um you know the spark may vary from time to time, but the tinder just continues to accumulate and the economic grievances, the social grievances, the political grievances, uh, you know, they they continue to compound.

Neri: 10:32

Right. And just for uh listeners, Marsa Amini uh was obviously the Iranian Kurdish woman who was uh detained back in 2022 and uh well beaten to death in custody by the Iranian security forces, uh, and that sparked, well, nationwide protests uh that were also, like you said, uh put down eventually. Um I'm curious, Nissan, you mentioned the real and the kind of economic trigger for the current unrest. According to previous reports, kind of going back a few weeks and a few months, there also seemed to be, I suppose, um, an energy crisis in Iran, which seems kind of remarkable given, you know, the Iranian oil and gas deposits. Uh it also seemed like there was no water previously in the summer. I mean, give us some context in terms of, you know, yes, there is an economic trigger and an economic collapse, especially in the currency, but uh, what other societal and infrastructure ills was ailing the Islamic Republic?

Naysan: 11:27

Aaron Powell I mean, you can go down a uh fairly significant list, right? There's there's decades of um mismanagement, corruption, and obviously there's a there's an impact from sanctions as well, which you know limit the the government exchequer. Um but uh you know over the over the summer there were uh water concerns due to the lack of rainfall, um, the infrastructure grid is creaking, which uh has led to you know power outages and things like that. And then the economy, you know, for the past since 2018 really, uh when the US uh under the first Trump administration introduced uh maximum pressure, the the Iranian government has touted its ability to respond with what it calls a resistance economy. And that um is like the blueprint for this idea is that Iran, by conducting enough oil sales, building up uh trade with regional allies and non-sanctioned trade in goods and things like that, developing domestic capacity that it can get by. And what I think we've seen is that it doesn't really work that well. Um inflation right now is uh above 40%. We talked about the the fall of the real. Um unemployment remains um uh consideration, investment into things like the electricity grid, um, water infrastructure, sustainable resources, um, all of those things when Iran faces kind of fairly acute environmental uh um uh strains as well. All of these things um again compound into a pretty uh dire malaise, which again the system doesn't really have good answers to. At best it can it can muddle through, and you know, there are countries that have worse inflation rates, there are countries that have gone through worse hyper uh you know uh currency falls and things like that. But it really is a kind of uh accumulation of you know immediate triggers, but then also kind of medium and long-term uh strains on the environment, on the economy, on infrastructure that, again, have no easy solutions and certainly not ones that the system's been able to find.

Neri: 13:41

Right. Uh muddling through uh tried and true formula, not only in Iran, uh until it becomes a lot harder to muddle through. Nissan, as a close watcher of Iran, can you give us a sense who is actually going out and protesting on the streets? So you mentioned initially it was uh in the Tehran Bazaar. Um I know there's some unrest and protests at various universities. I mean, who who is actually going out and coming out?

Naysan: 14:06

Well, it it started in the bazaar. It it also then spread to some university campuses. It's spread, I mean, in terms of the the geographic uh scope of it, it's it's dozens of cities right now. It's also um you know difficult to get a full picture. You know, we are we we see videos that come from abroad, we do get reporting from human rights organizations that have uh sources that are that are able to share what they can uh from what they see in Iran. Um so in terms of geographic scope, it's it's dozens of cities, it's a lot of youth um that are out there. Um the the you know the government has tried to uh staunch the flow by announcing various closures, saying that campuses are moved online or shutting down businesses and things like that. So um they're trying to to limit the the scale and the scope of it. Um and uh with these things it's obviously very difficult to predict trajectories, right? Like how does it um do these things, you know, does the crackdown mean that over time they start to ebb again? Does it mean that it only fuels you know further outrage and and and uh gives uh new waves of protests? I mean, the Masa Amini protests, they started in September um and they kept going for several months. And in some cases, um, you know, in in Sisan and Balushistan province, you know, it it went on for you know close to a year. Every week people would come out because that was one of the places where the crackdown had been uh the most severe, especially in Zahedan. So predicting the trajectory of these things is is extremely difficult. I mean, clearly it it speaks to a degree of dissatisfaction and discontent that um is against the system writ large, but in terms of whether you know we will continue to see it grow or whether we'll start to see it ebb, that that's very difficult. And there's obviously an X factor that's come in as well, which is the system has, you know, as we discussed, like faced several instances of these major uprisings from below. Now we also have um an added element, uh, an X factor of President Trump, at least twice at the moment we've spoken, uh, we're we're speaking right now, uh, warning the Iranians um that there could be some sort of US intervention um if the if the crackdown uh continues. He he mentioned this in a in a truth social tweet a few days ago, and again yesterday, Sunday, our time here in Washington, right. Uh during during a gaggle said that you know if the Iranians continue to do this, we will hit them hard. So um what that necessarily looks like, um whether we're talking about uh gone.

Neri: 16:45

No, I was gonna say hold that thought, because we're gonna get into uh the president's threats and what that could actually mean in practice. And also um more intriguing for me is how these threats are understood by the Islamic Republic and the regime in Tehran. Um but I'm curious, just in terms of the current moment and to put a bow on on where we are before we kind of further explain how we got here and then looking ahead, um, what has been the actual response over the past week by the Iranian authorities? So you said obviously the iron fist and casualties on the streets and uh the use of force. Have there been other, say, more conciliatory steps taken by the Islamic Republic to try to mollify the public?

Naysan: 17:27

Um there have been both attempts at conciliatory rhetoric and also you know threatening rhetoric. Um so uh Khamenei himself uh addressed this a few days ago. He said, you know, uh people might have some grievances that, you know, and and if they're protesting, that's one thing. If they're rioting, that's uh another thing. Now you can argue the extent to which the Iranian system sees those things as a distinction without a difference. And then Pezeshkian, who's been president for the past uh year and a half, um has kind of harped on this a lot and and and said, you know, we've we've we are facing uh uh difficulties. We're facing economic difficulties, we're facing social and political difficulties. Uh he also then kind of intimates that he can't do that much about them. Um, you know, like what do you do with these kind of very negative fundamentals?

Neri: 18:18

Aaron Ross Powell He basically said, What do you want from me? I'm just the president.

Naysan: 18:22

You're paraphrasing, but not not very far off. But again, the question is so you know, right now they can they can do certain things, right? Like they can try to increase uh handouts and subsidies, right, and and give people basically a small cash infusion. The risk there is that you raise inflation because you know prices, prices will go up. So you know the the the fact is that these are these are not problems that came up last week. Uh I mean, and if we're focusing only on the on the economic side of the equation, forget about the the social and political elements for a moment. Um the the Iranian government is um under um kind of uh suffering from internal mismanagement, internal corruption, and external financial pressure, where you know it's able to export uh oil, it's not necessarily able to repatriate all of that oil, or if it is, it it goes to you know, at least a portion of the proceeds may go to to you know various intermediaries that don't necessarily end up funding public services.

Neri: 19:27

Um that's a very nice way of saying uh corruption.

Naysan: 19:32

Corruption, yes. Um but and and you know these these notions of of uh regional trade and things like that. Again, uh trade with Europe is is basically nil. Um uh a lot of Iran's uh regional uh neighbors um export the same uh commodities that Iran exports. Uh there's some you know fruit and vegetable trade. There's obviously very active trade between uh the UAE and Iran. Um But uh it's like the fundamentals on the economy are have not been very good. Um and, you know, when growth is projected to be negative this year, when inflation is running above forty percent, um, when you've got the the currency volatility that you have, you need to make some pretty major either either be able to make some very significant cuts um in how much you're spending, or have a major injection of revenue somehow. And the f the first one requires unhappiness, facing unhappiness from whoever's money is being cut. Even more.

Neri: 20:36

Even more unhappiness than the unhappiness being exhibited on the streets right now.

Naysan: 20:40

Correct. And and the second one would require some kind of uh lifting of sanctions, normalization of Iran's trade, being able to repatriate the funds that it actually gets, um, being able to uh export oil again and again uh have access to the to the revenue. And you know, as far as that is concerned, again, diplomacy with with the U.S. right now looks um more about.

Neri: 21:06

Right. Uh and that's a very good jumping off point uh to the next topic I wanted to tackle, kind of um zooming out from the current moment and the current week to uh the past well two years, and really the past six months since the 12-day war uh between Israel and Iran. Uh last time you were on this podcast, Nasan, was way back in April of 2025. Uh seems like a different world, although in some respects it's the same exact world. Uh but you actually back then we we didn't quite uh know or predict uh that a war was just uh over the horizon. But what you did say was that diplomacy was going to prove be proven very, very difficult between Iran and the US. And that was uh back then in the spring of 2025. That was uh Trump's effort right after he re retook power and retook office to kind of engage Iran diplomatically. That went nowhere, and then Trump greenlit um Israel's attack in June. So I guess my first question to you, Nassan, is okay, uh, what impact did all, if any, have the past two years of war across the Middle East and also directly between Iran and Israel had on the Islamic Republic that brought it to this point, whether politically, economically, uh, or otherwise?

Naysan: 22:23

So if we spoke in in April of 2025, by that point the um the trend line for Iran was bad, and then it continued to get worse. So um, you know, starting in autumn of 2024, about a year after uh the 7th of October and and Israel's kind of um uh uh counter campaign uh first against uh Hamas and and then you know increasingly against the axis of resistance writ large. Um, you know, by that point, if you if you uh go back and think of where things were in April of 2025, Iran had essentially lost Hamas, it had largely lost Hezbollah, uh certainly as a deterrent force uh against Israel, it had lost Assad and in Syria. Uh and so that was all essentially the autumn um of uh 2024. And it uh came to uh these negotiations with the Trump administration um in a position that you know it has a significant degree of uh nuclear leverage remaining. You know, it's still it was enriching it 60 percent. It had limited uh we had limited inspections from the International Atomic Energy Agency. And uh Trump had basically uh come in with both a you know expansion of maximum pressure sanctions, but also this diplomatic overture uh conducted through a special envoy. Yes.

Neri: 23:54

No, Steve Woodkoff was the envoy.

Naysan: 23:56

Steve Woodkoff, yes, yes. And um, you know, uh initially it seemed like things were off to the to a decent start, but then we ran into the same problems that have bedeviled uh international diplomacy over Iran's nuclear program for more than two decades, which is this issue of enrichment. Um the Iranians uh said that you know we're willing to restrict the nuclear program, we're willing to increase inspections, um, but we're not willing to stop enrichment. And the Trump administration's position consolidated itself on zero enrichment being the standard that the US would accept. Um the Iranians rejected that. And so on the Friday, the 13th of June, uh we saw uh Israel uh launch uh its military operation against Iran's nuclear program, its ballistic missile program, senior IRGC officials, senior uh Iranian Armed Forces officials, senior Iranian nuclear scientists, and um later on uh the U.S. come in as well in an offensive capacity with Operation Midnight Hammer against Nathan's Ford and Isfahan.

Neri: 25:01

Right.

Naysan: 25:02

So if you if you look at it from a quasi-neutral perspective, right, that war first of all showed that um, I mean, first of all, it it left the upper ranks of Iran's military and nuclear echelons uh fairly decimated. It showed that Iran's air defenses were extremely vulnerable. It showed that Iran's offensive capacity in particularly in the form of ballistic missiles and especially drones, were largely uh repellable by by Israeli and Allied defenses. And um an utter um uh upper hand in terms of Israeli intelligence capacity, right? In terms of being able to pinpoint where all of these Iranian uh officials were, being able to build drone factories on Iranian soil and conduct drone operations from Iranian territory. Um but in the Iranian state narrative, there is also a victory there. And the victory is that, first of all, despite all of this, um, the system survived. The system was able to maintain the chain of command, all of the commanders who were killed were quickly replaced, the missile capacity was able to muster two weeks' worth of regular salvos against Israel. And that, in their view, an attritional conflict that would have lasted longer would have been to their advantage, which is why the US and Israel agreed to an unconditional ceasefire. That is the state narrative. That is what Iranian officials uh contend when they say that actually, you know, if if if we had been on the back foot, Washington and Jerusalem wouldn't have agreed to a ceasefire.

Neri: 26:38

Right.

Naysan: 26:38

And the fact that we are we were still standing by the end of the 12 days um shows that actually they they recognize that we can play we were better in the long game. And um that the uh the damage to the nuclear facilities was significant, but not to the technology, not to the knowledge, and that the ballistic missile capacity was um uh the damage wasn't that bad.

Neri: 27:02

Those are the narratives that come very interesting out of the No, it's very interesting. Okay, continue. So that's this is their narrative coming out of last June.

Naysan: 27:11

That's the narrative. Now, narrative doesn't always uh comport to reality. And I think it also has put the Iranians in a in a very difficult position even before these protests. And to a certain degree, um facing uh a series of difficult options, they've taken none of them. So um from a certain perspective, like on the nuclear program, for example, they have not conducted anything that would be regarded as a major provocation because one of the things that they don't know is what is Israel's red line or what is the U.S. red line on nuclear reconstitution. And so um de facto they have been at zero enrichment for seven months. As far as we know, Iran has not rebuilt uh or certainly resumed uh uranium enrichment. Now, there are a lot of questions around the status of Iran's nuclear program. We haven't had international inspectors on the ground since mid-June. Um we do not have um uh absolute clarity. We have we have uh a sense that the fissile material is inaccessible and buried uh at the various enrichment sites, but we don't know that with an absolute certainty. That includes 400 kilograms of 60% enriched uranium, which is near weapons grade, and I think Prime Minister Netanyahu alluded to today, speaking at the Knesset. Um and then um, but you know, they not knowing both the degree of continued intelligence penetration um and the red lines that could could prompt a a um resumption of strikes. Yeah, they uh on on the nuclear front, whether it's because of the damage sustained or the risks that they could incur, um, they have not really taken dramatic steps to reconstitute that that activity. There's been cleanup efforts and things like that, but but as far as we know, no resumption of enrichment. At the same time, they continue to insist that they would want enrichment in a New Deal with the United States. The fact that the United States is saying there can be no zero enrichment means that there's no point in negotiating. So on the one hand, they're not uh they're essentially doing what the U.S. has asked, but on the other hand, uh refusing to acknowledge that as a diplomatic uh concession.

Neri: 29:29

Aaron Powell Not reaping any of the any of the benefits of this de facto policy they've adopted over the past six months.

Naysan: 29:35

Aaron Ross Powell That's right. Um and then on the ballistic missile side, we know, and and Israeli intelligence has also said, and IRGC officials uh you know boast about it regularly, that they are trying to rebuild the nuclear program. They you know Iranian officials will say that actually the damage was sustained wasn't that big to begin with. Um, but we've seen reports citing Western intelligence about um uh shipments coming in from China that can be used towards uh fueling ballistic missiles. Apparently the U.S. interdicted a shipment a few months ago that was coming from China. These are things that can uh be used towards uh ballistic missile development. And uh Prime Minister Netanyahu, you know, when he was visiting with President Trump in Mar-a-Lago has mean you know made the case that Iran's missile program uh is rehabilitating. President Trump said that either the nuclear or the missile programs could be cause for a resumption of either Israeli and or U.S. uh strikes. But again, we don't quite know what the threshold is. And I'm I'm I'm I I you know I would be surprised if the Israelis made much effort to publicly enunciate what that red line is, because if the Iranians don't know, um they they may err on the side of not crossing it. But either on the the the nuclear program or on the ballistic missile program, there is continued concern in Israel, as you well know. President Trump has indicated that it could very well be a uh trigger for renewed strikes. And on the Iranian side, um fairly coy in terms of nuclear activity, but um trying to do what they can at the very minimum to rehabilitate the ballistic missile capacity, which was really their only kind of tool against Israel during the war.

Neri: 31:27

Right. So uh I'm gonna get back to the missiles in in just a second. Uh believe me, I'm very curious to get your your take on one particular aspect of that. But from the sounds of it, you're basically saying that, especially after the 12-day war last June, the Iranian leadership has essentially decided not to decide. Right? Not on diplomacy with the U.S., not on economic reforms, uh, not on proactive aggression against Israel or not. I mean, basically a whole host of issues that they've essentially not either wanted to decide on or been able to decide on. Is that fair?

Naysan: 32:02

I mean, non-decision is a form of decision in and of itself. Um, but uh yeah, I think that there's an element of um paralysis facing very difficult choices um of just not of trying to, again, like with the economy, uh, muddle through and and keep your head down and um try to try to get by. You know, the the um the diplomacy with the US um is uh a case in point. You know, they they uh despite the war in June, they really haven't shifted any of their positions um and in terms of what they want out of a uh what they're willing to offer in a deal with the U.S. the the insistence on a domestic enrichment capacity, notwithstanding the fact that for six plus months there has been no domestic enrichment capacity remains something that they won't budge on. And for them, it's also um, you know, they they say and um that the the US is also demanding much more than that. They're they're demanding limits on on missiles, they're demanding limits on proxies, so you know if you concede on one, it becomes a slippery slope that even then may not satisfy the administration. Flip side of it is that if you don't agree to that, um, you know, the economic situation, as we have seen, uh doesn't get any better. And uh while you can try to rehabilitate your conventional systems, um they too could run get you to a point where the Israelis are sufficiently um seeing threat and opportunity because Iran's air defenses did not turn out to be a ringing endorsement for the S-300 systems in June or in October of 2024. And um, so again, that that vulnerability may be something that bears bearing bearing in mind, I suppose, for what the calculus is in in Israel and and and the U.S.

Speaker: 34:08

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Neri: 35:06

I mean, I had two questions before before I get to the missiles, trust me, I'm going to get back to the missiles. But um, how much of a problem is it inside the Iranian system in terms of their lack of ability to take decisions? Um, is related to the fact that the Supreme Leader is both quite old already, um, and also perhaps diminished, if not personally, then publicly and politically, after the humiliation of the Twelve-Day War, where he essentially just kind of disappeared. In other words, uh Supreme Leader Ali Khamenei, who's been in power since uh the late eighties, after he took over from Khomeini, is he uh now part of the problem? Is he not uh I mean, sorry for the pun, is he not so supreme anymore?

Naysan: 35:52

Aaron Ross Powell Well, I think, you know, it's interesting because uh, you know, the his title is Supreme Leader, and there are people who work on Iran that that that will make the argument, I think with some merit, that supreme decision makers is a bit more of an accurate title, right? He doesn't make decisions without context. There is a there's a uh there is a policy process within the system. There's a Supreme National Security Council in the system that brings together the president and the head of the parliament and the the various um uh uh eminences, grees of of of the system. And then they present essentially a set of recommendations to him that he gives a thumbs up or thumbs down to. And for the most part, he takes their recommendations every once in a while. He might cast a veto on it.

Neri: 36:37

But uh Does he only not have one working hand? So it would only be really one one thumb heading upright. Sure. Okay. You didn't you didn't you didn't like that. You didn't like that joke.

Naysan: 36:49

Uh no, it's it's yeah, he he he he does have an injury in one of his hands uh as a result of a bombing in the early 80s.

Neri: 36:56

Right.

Naysan: 36:57

Um but um the the fact is that I I think with it you know, so the problem such as it is in terms of decision making is that there's you know a bigger systemic uh paralysis, right? And you know, you have um some people in in the system you know who are more hardline who say, you know, the problem with June is that we didn't go big enough. Uh and the problem with the nuclear program is that we hedged and and we should have you know gone uh bigger, faster, quicker.

Neri: 37:29

Full breakout.

Naysan: 37:30

Um full breakout when, you know, because what you know, what has been the point of you know being at 60%, which is enough to pose a threat, but not enough to actually have the nuclear deterrent. Um and then there are other people who you know will say that look, you know, how does this end essentially? Like what is you know, how do we get this economic reprieve? How do we de-escalate tensions um with the US, not necessarily with Israel, because that is an ideological uh foundation that very few will be willing to openly question. But uh again, you know, these are all, you know, if if if a deal with the US requires compromising on this issue that the Iranian system has made a fundamental point of principle for 23, 24 years of nuclear diplomacy. And even then you don't know whether the US would accept it. And even if the US accepts it, you don't know if the US would follow through. It leads to a, I think, a degree of uh systemic paralysis and Khamenei being Khamenei and being the age he is and being um uh in the position he's been in, um, you know, is is probably not you know uh pushing for radical ideas at this point. But when you're dealing with fairly unprecedented conditions in terms of the uh the ability of Iran to project power through the axis of resistance, the failure of its deterrence through uh conventional missiles, the the fact that the nuclear leverage is now not in what Iran has in terms of nuclear capacity, but what we don't know about its nuclear capacity, right? It used to be that the leverage was the growth, the expansion of its nuclear program. Right now it's the opacity of the program. It's the fact that we don't know with absolute certainty where those 400 kilograms of 60% are. Are there centrifuges squirled away because the IAA hasn't had access for a couple of years to centrifuge production sites? And the Israelis targeted some of the known production sites, right? It's not just Natans Fordo and Isvan, it's not just the enrichment sites, it's also the bigger nuclear infrastructure where you're actually building parts and putting together centrifuges and all of that stuff. So that is essentially what they um are playing with on the uh on the on the nuclear side of the equation. Um, but what they also don't know is how much the Israelis were The Americans or Allied intelligencies, uh intelligence agencies are able to see uh right now. So if there was a clique saying, you know, we need to take some of that 400 uh kilograms of 60% enrichment uranium and marry it with some of the centrifuges that may not have been accounted for, may not have been destroyed, um, and then essentially uh, you know, try to uh uh have a crash program, um, they have, I think, zero confidence or should have zero confidence in their ability to do that in a covert and undetected manner.

Neri: 40:33

Right. Uh so risks any way you look, and hence the paralysis, especially in the form of the supreme decision maker who is not making any real decisions except not making decisions.

Naysan: 40:47

That's right.

Neri: 40:47

Okay. Glad I glad I got that all all worked out. Uh and which, you know, is a good explanation for how the Islamic Republic finds itself in the current situation it is. Um As promised, I wanted to just circle back really quick to the issue of Iran's ballistic missiles. So I went back into my notes from last summer uh and I looked at the various pieces of information I got from various sources uh on my end here in Israel, and I wanted to kind of do some back of the envelope math with you, Nasan, uh, and then kind of try to understand where we are in terms of specifically the missile program and the missile threat that um we've been hearing now for definitely a month, if not longer, from the Israeli side saying, you know, this is a real threat. Iran is uh rebuilding and reconstituting its ballistic missile arsenal, and that as you mentioned, uh it could be a trigger for future and further military action, uh whether whether by Israel alone or you know with a green light or active support of Donald Trump. Um but again, uh on the eve of the June 2025 12-day war, Iran had, according to Israeli intelligence, 2,000 ballistic missiles in its arsenal, right? They fired 550 of them at Israel during the war. I think three dozen, maybe, maybe more, got through uh and caused a lot of damage, but it could have been a lot worse, as listeners of this podcast are fully aware. Um, and that the post-war assessments by Israeli intelligence uh said that basically either half to two-thirds of Iran's missile stockpile was destroyed during the war. So between half and two-thirds of the stockpile destroyed, um 200 missile launchers were hit. So distinct from the actual missiles, you need launchers, and that's real, that's a real bottleneck uh in terms of just military operations. So 200 launchers were hit by Israel during the war. Um, that's two-thirds, according to the IDF, of the total number of launchers that Iran had. Um, and that's not even including kind of the missile production facilities and other equipment. So, my question to you, Nasan, I don't know if there's a real answer, but I'm raising all of these numbers and data points to query whether it's actually credible that Iran reconstituted its entire ballistic missile arsenal over the past six months since the June war.

Naysan: 43:13

Um I think part of the question would be how accurate were those assessments prior to the war? I mean, you will remember, because I'm pretty sure you reported on it, that you know, after the Israeli strikes in October of 2024, there was a suggestion that Iran's capacity to create ballistic missiles, um, certainly some of the more uh advanced solid fuel variants had been substantially curtailed, right? Um and then in June, um, you know, the the um the we we've gone from there's been a significant degradation of Iran's capacity to produce ballistic missiles to Iran is actively and and successfully ramping up its ballistic missile production. So um uh we we know that the Iranians certainly are claiming to be rebuilding their ballistic missile capacity. We know that there's evidence of uh you know sodium percolate imports from from China that can be used for um uh ballistic missile development. Um it's also a question um of you know which variants of which missiles did they use? You know, did they did they fire their top-tier stuff or how much of their top-tier stuff did they fire versus the kind of medium-term stuff? The drones were almost entirely um ineffectual.

Neri: 44:32

Right.

Naysan: 44:33

Um and um but you know, it's also, and and you know this far better than I do, that you know, the if you look at it numerically, the Israeli defenses were extremely robust. I think 86% intercept rates, um, you know, it was running 90 plus uh throughout the first several days of the war, kind of dropped off a little bit towards the end. Um and you know, there were impacts at a at a few places. There was, you know, the the refinery in Haifa, the Weizmann Institute, um, a few other um, you know, the hospital in Bersheba. Um, but um, you know, the fact that um you know they were able to maintain this uh pace um uh even if it ebbed and flowed in terms of actual numbers and actual damage for two weeks, is um, I think uh Israeli officials would would probably say that under the circumstances it was as robust a defense as as could have been hoped for, and in terms of offensive capacity, neutralized as much as as could have been done. Um question is in isolation, how much of a threat does it pose, right? And especially if it's separate from the nuclear program. Um and that's a judgment for you know Israeli officials of uh and and and their assessments because you know the Iranians will say that they are rebuilding at a at a rapid pace and that their you know ballistic missile capacity and their defensive capacity, if you believe that, is better off today than it was on the 12th of June. Um whether that is actually true uh is is a very open question.

Neri: 46:08

Do you believe it to be true?

Naysan: 46:10

I don't know.

Neri: 46:11

Okay.

Naysan: 46:12

Um I don't know. I think it's it's the element of the Iranian national security doctrine that they have the most control over because the Axis is um not in the condition it was before, certainly in terms of Hezbollah, certainly in terms of Hamas. Um the Houthis probably fared uh rather rather better than the rest of the Axis did. The nuclear program is as leveraged right now, again, is mostly in terms of its opacity, not its growth. So the uh ballistic missiles, and and given that Iran doesn't really have a functioning air force, certainly not one that could threaten Israel, um means that by process of elimination, if you're going to invest in reconstituting something, the ballistic missile capacity is the only one that you really have at your disposal. And a lot of it, notwithstanding the reliance on Chinese uh imports for sodium percolate and elements in that that are used in part of the fleet, it is the one that they have the most control over, arguably. So it stands to reason that if they were looking to rehabilitate one element, the missile element would be the one that they would put the quickest and and fastest investment in. Um so that that all stands to reason. How um effective they've been, uh, they would be, how much the balance is against Israel's defensive capabilities, you know, the you know, we know that the the US burned through a lot of munitions, we know that the Israelis burned through a lot of defensive munitions during during the course of the war as well. Um so um if there were to be an Iranian salvo on the orders that it were um in in June, would the Israeli uh defenses be as robust and for how long as they were in June? Those are those are technical questions to military experts that would have to have you know at better access to information than than I necessarily do. But um, you know, I think that the uh at the very least, the the rehabilitation trend line seems to be on the missile front um something that there's a convergence of what the Iranians say and what the Israelis believe.

Neri: 48:26

Yeah, and there's also um major scope in that Venn diagram for miscalculation, that the Iranians play up the numbers and capabilities. The Israelis either believe it or see something that spooks them. Uh, and then maybe someone here on this end uh decides that it's a big enough risk or a big enough threat rather, uh, to pull the trigger with U.S. support. Um by the way, I don't think this is a likely scenario in the coming months, so just to kind of calm everybody down, but but there is a risk here of miscalculation.

Naysan: 48:59

I think that's very true, and it it's it's funny because you know we think of the US and Iran as you know having no diplomatic relations and and you know, oftentimes being at loggerheads, but there are mediators, there are intermediaries, there there is a you know special interest section. There's a back channel, the the there's a break glass in terms in case of emergency uh at the Swiss embassy in Tehran, which is, you know, serves um the US uh as the U.S. special interest section. We know that over the course of the negotiations um between the Trump administration and and and Iran, you know, Special Envoy Witkoff and um uh Iranian Foreign Minister Abbas Air Shu were in touch directly. We know that the Iranians apparently gave the U.S. uh heads up uh when they were retaliating at um for the uh against Qatar. Um with the Israelis, none of that really exists, which is which makes interesting the fact that there have been multiple reports over the past few months about messages going through Moscow.

Neri: 49:59

Exactly.

Naysan: 50:00

Which again, and you know this because you've you've you've covered it, you know, there was an element of deconfliction indirectly uh in Syria when when you know the we had the war between the war campaign um uh you know about a decade ago. Um and again, you know, if the Israelis are are um if the Iranians, for example, are doing military exercises and and you're an Israeli planner, you see a lot of things moving into place and and you might be concerned. And if you're the um Iranians and you see the Israelis doing military exercises or you know, statements, or you know, the the fact that, you know, from from the Iranian perspective, uh the 13th of June uh had a major element of surprise, right? Because they they thought that they were still going to negotiate with the Americans on the Sunday when the the attack was conducted on Friday. Um so there is uh you know potentially always an element of a ruse uh or or misdirection. Um and and you know, Israel has uh an ability to mount a fairly significant campaign on fairly short order. So uh I think that's right. You know, even if um neither side necessarily wants to start off a second round, or depending on how you count it, a fourth round, um, this is one of the perennial questions when you have two uh adversaries with, I mean, forget about any trust, but any you know basic uh communication or deconfliction lines as well.

Neri: 51:32

Aaron Ross Powell And the scenario that we hear, especially in recent days on this end, um, by uh certain reporters and certain leaks of Iran actually itself launching a surprise preemptive attack, uh whether due to Israeli moves or U.S. moves, um, either at Israel directly or U.S. bases, that they're gonna kind of shoot off what they have, as you mentioned, ballistic missiles and other kind of projectiles. Uh and then I don't know, hope for the best, I suppose. I mean, how incredible do you think that scenario is?

Naysan: 52:06

I think hoping for the best, if if that's the thinking, is is uh is uh potentially quite disastrous. Um I mean the Iranians have, you know, for example, um they have in the context of attacks uh you know by by ISIS in Syria, they they've they've bombed Syria. Um uh attacks by ISIS in Iran, they they bombed Syria. Um when there were Jaishul Adl attacks, like separatist attacks in the in the southeast of Tehran, they bombed uh Pakistan. They have bombed uh uh Kurdish bases, I mean they bombed Urbil, you know, claiming that you know these were Israeli intelligence hubs, Mossad hubs, without obviously offering much evidence to that extent. So there is precedent in Iran conducting extraterritorial strikes in response to domestic developments. Certainly some people in the system are saying that the current round of protests is orchestrated by the US and Israel as they as they always do. But I mean, it would be hugely uh risky given that uh their air defenses, as far as we know, are not better off um than they were in June.

Neri: 53:22

Um it's a nice way of putting putting it, yeah.

Naysan: 53:27

I mean, uh the the vulnerabilities are are are are pretty stark, right? So if if if that if those analyses that that you're referencing are correct, and I wouldn't be surprised if there are some people in Tehran who who are either arguing that you know next time it has to be us who goes first or see signals that they take to mean an immediate Israeli or US strike, um, which again comes to the point about potential miscalculations. Um but I think you know it once you get the first move off, you have to anticipate the the the other side's first move. And Iran, given what we saw in June, um would take uh a significant hit in the event of a of a second round.

Neri: 54:13

Right. Um I should have just sharpened my question to you. Uh the scenarios that are being leaked here, uh the concern on this end in Israel is that um as a result of the domestic unrest in Iran, that Iran may choose for whatever reason to try to divert attention externally and f and start firing missiles at whoever. Um which again, um I don't know how that would work as well, because then you run the risk of a real a real response by Israel, the Americans, someone else.

Naysan: 54:45

And I would just say, because I think it bears to the point that we started on, um, which is that you know, after June, one of the things the Iranian state really tried to cultivate um was this sense of, you know, rally around the flag, you know, or if not even the if not even the flag, like if not even in support of the system, then at least in the name of the soil, right, in the name of territorial integrity, that you know, even if you're against us as the regime, you know, you shouldn't be happy about the country being bombed type of thing. Right. And to the extent that that may have taken some route, I think the protests now that we've seen over the past kind of uh seven, eight, nine days show that that doesn't really work when the fundamentals are still so poor, right? So kind of uh pleading unity um does not resonate all that well when the economic, political, and social discontent is unaddressed. And you see some commentators in Iran that have kind of said, well, you know, we should have used this moment to actually start to make some adaptations and maybe start to, you know, talk to the Americans in a different way, or use that moment to make difficult calls on the economy and things like that. Um hindsight is 2020, but I think that it does show that this, like, if the state tried to use that and if it would try to use that logic again per what these um uh leaked reports uh suggest, even then it would be a very finite resource, I think, without shifts in the the issues that people are actually protesting about.

Neri: 56:28

Okay. Fair enough. Um final question to you, Nasan, before uh before I let you go. Uh, and it's about the Donald Trump of it all. So the first part of the question, uh, when you hear the US President make these comments and make these threats, uh saying that uh, how did he put it overnight? If they start killing people like they have in the past, I think they're going to get hit very hard by the United States. Um what tools does Trump actually have in his toolbox to make good on those threats, if if he does actually make good on them? Uh that's the first part of the question. And then the second part of the question, I think you already know what it is, right? Uh stemming from this Saturday's events in Caracas in Venezuela, the Nicolas Maduro snatch and grab, the Supreme Leader, the other officials of the Islamic Republic saw it, like everyone else around the world saw it. Um what's going through their mind, what impact does the event in Venezuela have on their thinking, again, if at all?

Naysan: 57:32

I think it does and should, um, because look, it it w I and I think that the the two elements of the question are very much complementary because I think rendition of a head of state is you know one end of the spectrum of you know potential um uh responses, right? So when the when the president says um you know if Iran continues down this path of repressing, you know, the they could be hit hard, um, I mean we know what precedents exist. We know that there's sanctions, designations um that could be done. Um we know that there's you know after after uh you know the there could be increased support to like you know satellite communication and things like that to in case the government tries to curtail um uh access to the internet again and and um you know uh under in the mas A mini protests, Iran was kicked out of some you know international human rights fora um and and things like that. Then you get into you know perhaps uh covert or or overt operations. And you know, for the Iranians, if I I think what what happens in uh Caracas kind of underscores a point. It doesn't really make a new one. I mean, Trump is the one who made the decision to kill Qasem Soleimani six years ago, he's the one who uh agreed to carry out strikes on Iran's nuclear facilities in in June. So he is not averse to making big calls um with big consequences.

Neri: 59:06

Right.

Naysan: 59:06

And I I think um, you know, uh, from if you're in Tehran, I think the the the issue is you don't know um what's bluster, what's bluff, what's threat, um, and what options are on the table because his nature is uh has this un unpredictable element to it. Now, there are other lessons people in Tehran might might take as well, right? We know that Maduro was talking to Trump, right? They were trying to negotiate with Trump. And uh whatever Maduro was willing to offer clearly wasn't sufficient for what Trump uh expected. And so there are people in Tehran, I assume, who will all also make that argument that see, like this is entirely futile, like don't even think about talking to this guy because it won't go anywhere. Um that's one element of it. And the other element of it is that he doesn't Necessarily bluff. And you know, to come back to the June war, we know that Iranian leadership was in Israeli crosshairs. Both Khamenei, who I think some Israeli officials said, you know, he'd gone underground, and if we if we'd had him in our sights, we probably would have taken him out, to apparently, you know, striking the Supreme National Security Council, you know, with President Pazesh Ion being injured. So, you know, the an effort at least towards decapitating not just the military and nuclear echelons of Irania, of the of the Iranian system, but also its political echelon, was not entirely untried in June. And so that means that again, in the context of what a um US and or Israeli uh operation could could look like down the ground, like we've already kind of crossed some of these thresholds, not just in Caracas, but in Tehran itself over the past few months.

Neri: 1:01:03

So nothing new but the Caracas president combined with a domestic unrest should increase the paranoia in Tehran. And as uh someone once said, you know, uh paranoia it's just another word for being uh mildly observant. So they've they've been observing uh these threats and the US president making good on these threats for quite some time. So in their minds, I suppose you're saying that it could it could actually get to a decapitation attempt.

Naysan: 1:01:31

I'm not saying that it could get to a decapitation attempt. I'm saying that what the Iranians certainly can't take away is ruling any of these things out at this point. And when it comes to the protests, I mean to you know put it put a bow on on the conversation and going back to where we started, you know, we we've talked about the playbook that the Iranian system usually uses, which is a little bit of conciliatory language and a very heavy iron fist. And what the president has said is that I'm not gonna let you get away with with an iron fist. I mean, they already have to a certain extent, right? There's been at least 20 fatalities and and um you know continued uh uh as we speak, there's still uh clashes and and uh repression that is ongoing. So, what exactly the threshold would be um uh for the president to contemplate some kind of um hitting them hard remains to be seen. But I think again, if you're an Iranian decision maker and you have this playbook that you've used in multiple rounds of press protests, which is if you crack down hard enough, strong enough, long enough, it will eventually peter out in terms of an immediate security concern, if not a governance problem, which I think just continues to get worse, then um you have this um way that you've approached threats from below, but now you have this um X factor where using that playbook now potentially invites an intervention from abroad, which wasn't the case in 2017, 18, 19, 2022, right? Like at no point in any of those uh protests was there a serious probability, let alone likelihood, that there would be some kind of potential military intervention against those protests. And now, at the very least, it's something that they have to have in back of mind.

Neri: 1:03:22

Aaron Powell And that could lead them to a bit of pause with regard to their response if these protests continue and grow.

Naysan: 1:03:29

Aaron Powell And then it becomes a catch-22. If if the if if you're holding on the repression and the protests continue to get worse, but repressing further could lead to uh an intervention that's uh you know coming from outside, you really are in a bit of a quandary. Um and I think again, you know, I think if you look at this dilemma and the other dilemmas that we've mentioned in terms of Iran's you know wider security concerns and its diplomatic impasse, um, it really has been a trend line of um bad choices that continue to get worse.

Neri: 1:04:04

Um indeed. Indeed. Uh bad choices, uh most of which are are self-inflicted. So uh maybe maybe they will change course, although I'm not holding my breath. Nissan, as always, thank you very much for your time and your insights. Best of luck this season with Arsenal Football Club. I don't really mean that, but uh I suppose I have to say that just for the record.

Naysan: 1:04:28

Uh and we'll I don't believe it, but anyway.

Neri: 1:04:31

Right. Uh and uh I'll chat with you uh hopefully very soon. Take care. Thanks very much. Okay, thanks again to Nason Rafati as always for his generous time and insights once again. Also, a special thanks to our producer, Jacob Gilman, our editor, Tracy Levy, and our assistant producer Eden Jesselson, as always, and to all of you who support Israel Policy Forum's work. Do consider making a donation to Israel Policy Forum so it can keep being a credible source of analysis and ideas on issues such as these that we all care deeply about, including this podcast. And most importantly, thank you for listening and please, please subscribe and spread the word.