LINCOLN – State funds invested in companies that have ties to Iran’s oil and military sectors would be pulled out under a bill introduced by Sen. Bill Avery of Lincoln.The Nebraska Iran Divestment Act is part of Attorney General Jon Bruning’s 2013 legislative package.
The bill targets state pension funds invested in companies that provide power-production services, mineral extraction activities or military equipment to the government of Iran. It would require state officials to determine how much money Nebraska has invested in such companies.
“There’s no reason at all why we should have any of our public funds in Iranian assets,” Avery said, adding that any aid to the Iranian economy helps Iran maintain its nuclear program and engage in international terrorism.
The bill is part of a larger, national push to divest public money from Iran. According to United Against a Nuclear Iran, an advocacy group that seeks to prevent Iran from acquiring a nuclear weapon, 24 states and the District of Columbia have already enacted similar divestment legislation or policies. The result has been more than $1 billion extracted from foreign companies with ties to Iran.
“We absolutely support the new law that if passed would put more economic pressure on the regime,” said United Against a Nuclear Iran spokesman Nathan Carleton about the Nebraska bill. “No American tax money should be going to companies that do business in Iran.”
State-level divestment actions are taking place alongside federal and international sanctions meant to force Iran to stop enriching uranium, which could be used for a weapon. The sanctions have taken a toll on Iranian oil exports, which are down 40 percent, according to a recent statement by Iran’s oil minister, Rostam Qasemi.
Avery said the Nebraska bill targets Iran’s oil industry specifically, “because that’s the strength of the Iranian economy – oil production.”
Despite wide-ranging support for divestment actions and sanctions against Iran among some politicians and advocacy groups, policy experts remain skeptical about the effectiveness of these tactics.
“I think that divestment and sanctions have good symbolic value,” said Ross Miller, a political science professor at the University of Nebraska - Lincoln. “They are communicating to both Iran and to our allies and others that our position is serious, but I’m not convinced that they will have any real effectiveness because the track record for economic sanctions is not that great.”
Miller, who specializes in research on American foreign policy, cited one study that found economic sanctions were only effective at achieving policy goals 10 percent of the time.
Even worse, Miller said that divestment and sanctions often have the opposite of their intended effect.
“The more pressure the United States puts on Iran not to build nuclear weapons,” Miller said, “the more likely they are to build nuclear weapons.” He said this was because outside pressure strengthens the message of hardliners within Iran’s government who argue that Iran needs a nuclear deterrent as a defense against foreign enemies.
Avery compared the divestment actions against Iran to the successful divestment campaign that led to the end of apartheid in South Africa. “That one was a humanitarian issue; this one is more of a rogue state behavior,” he said. “I don’t think there’s any doubt that Iran is a danger to world peace.”