Current Economic Sanctions Toward Iran Paula Tabatabaie Principles of Economics (Macro) J. R. Sanford Fall II November 24, 2006 The US hostage crisis in 1979 during the overthrow of the Shah effectively ended American and Iranian formal relations. Relations worsened over the next decade due to America�s support of Iraq during the Iran-Iraq war, Iranian-sponsored terrorist group attacks, kidnappings and murder of American citizens, and the downing of an Iran Air airliner by a United States cruiser. This behavior by Iran forced the United States to increased economic sanctions, the strongest passed under President Clinton�s policy of �dual-containment� against Iraq and Iran in 1995-96. The 1997 election of politically moderate President Khatemi gave hope to more involvement with Iran, but his minor success to gain domestic reforms against the hard-line Council of Guardians reduced any hope in improving our relationship with Iran. President Bush�s 2002 statement naming Iran a member of the �Axis of Evil� made any form of communication difficult. A re......

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