Iraq? No, Iran.

Even if Saddam Hussein is toppled and replaced by a pro-American regime in Iraq, the United States will still face a large, well-armed adversary in one of the most volatile regions of the world. Twenty-three years after the Iranian hostage crisis, Iran's theocracy remains fully in charge of the country and a fierce opponent of much US foreign policy.

Iran has harbored fugitive al Qaeda members, charge US officials, and is attempting to extend its influence across its border into western Afghanistan. It is working apace on an effort to develop a nuclear weapon--and, unlike Iraq, Iran's program has never been disrupted by UN-sanctioned weapons inspectors. Despite its long, bitter war with Iraq in the 1980s, Iran has criticized US efforts to oust Saddam--perhaps because some in Tehran fear they might be next on Washington's list.

The Real Power

Recently, the Bush Administration pulled the plug on a five-year US effort to work with President Mohammad Khatami and encourage a reform agenda in Iran. The phrase "moderate Iranian" remains an oxymoron, decided the Bush team, at least when applied to government officials. Real power in the country remains vested in ruling mullahs, who of late have taken to shutting down opposition newspapers and jailing student demonstrators.

"Uncompromising, destructive policies have persisted" in Iran despite the efforts of reformists, said President George W. Bush in a written statement relayed into Iran July 12 on Voice of America radio.

At the same time, Bush offered support to street protestors and other ordinary Iranians who, he said, continue to agitate for freedom. The Iranian people have "no better friend than the United States," he said.

Iran's strategic position in the Middle East is a crossroads of trouble. To its east lies Afghanistan, to its west, Iraq. To the north are Turkmenistan and other unstable nations carved out of the former Soviet Union. To the south, across the Persian Gulf, are Saudi Arabia and the smaller oil states, whose Sunni version of Islam has long been in conflict with Iran's dominant Shiite Muslims.

Iran is big--easily three times Iraq's size, with about three times as many people. Known as Persia until 1935, it is also non-Arab. As such it has traditionally been something of an outsider in the region, different from Egypt, Iraq, Syria, and other regional powers in both ethnicity and religious tradition.

Its status as a Middle Eastern state that stands somewhat aloof from its neighbors has long made it attractive to the United States and other Western powers as a potential ally. "Potential" is the key word, however. The history of US-Iranian relations has seldom run smoothly.

In 1953, the CIA conspired with Britain to overthrow Iran's elected Prime Minister, Mohammad Mossadegh, due to worries that he would nationalize Iran's oil industry. In the short run, the coup was successful, but it provided anti-US Iranians with a grievance that would prove highly damaging over the long run. And the man the coup empowered, Shah Mohammad Reza Pahlavi, was no Churchill. He was not even a Sadat. Weak and indecisive, he never quite managed to live up to Washington's idea of a regionally influential leader.

Then came the revolution (1977-79), in which conservative clerics crushed Westernizing liberals and turned Iran into an Islamic state. The hostage crisis caused by the November 1979 seizure of the US Embassy in Tehran by militant students played a large role in the defeat of President Jimmy Carter by Ronald Reagan, who promised a more muscular foreign policy.

Reagan had his own problems with Iran--namely, the Iran-contra affair, in which the proceeds from arms sales to Tehran were to help fund contra rebels in Nicaragua. In one of the most bizarre episodes in US diplomatic history, American officials arrived in Tehran for secret meetings, proudly bearing a cake baked in the shape of a key. This was meant to symbolize the "opening" of a new relationship with Iranians purportedly more moderate than the nation's ruling mullahs.

Since then, US policy debate concerning Iran has generally centered on whether there truly are moderate factions in the country and, if there are, what kind of a relationship to have with them. Iran is not a dictatorship like Iraq. There are national elections for a president and a unicameral legislature. Ultimate power, however, continues to reside with religious leaders. The chief of state is Leader of the Islamic Revolution Ayatollah Ali Hoseini-Khamenei, who was appointed to his post (for life) by a panel of religious elders.

The current Iranian president may well want to make Iran more democratic and free, but at the present he does not appear to be making any headway.

"The unelected hard-liners have consistently been able to checkmate reformists and maintain hard-line rule," said Zalmay Khalilzad, National Security Council senior director for Southwest Asia, the Near East, and North Africa and special envoy to Afghanistan, in a speech on Iran policy given Aug. 2.

The ruling clerics have shut down more than 70 newspapers in the past year and ordered the arrest of dissident intellectuals and parliamentarians, noted Khalilzad. The former designated successor to the Ayatollah, Ayatollah Montazaeri, remains under house arrest for simply questioning some aspects of clerical rule. Nine women were registered to run for president last year, but none were allowed to do so. Courts continue to place limits on participation by women in public life.

Meanwhile the Iranian economy is dead in the water. Unemployment is nearly 30 percent, according to US government estimates, with inflation nearing 30 percent. Per capita GNP has been stagnant for years. One out of every four Iranians with a college education works outside the country, according to Khalilzad.

"I admit that there is a sort of hopelessness in our society," said Iranian President Khatami publicly this summer.

It is against this background that President Bush has branded Iran a member of the "axis of evil" and a nation whose foreign policy goals are inimical to the United States.

Administration officials say they are particularly concerned about three things: Iran's continued push for Weapons of Mass Destruction, its support for terrorism in general, and its mixed reaction to US military action in Afghanistan.

"The initial signs of Tehran's cooperation and common cause with us in Afghanistan are being eclipsed by Iranian efforts to undermine US influence there," said Director of Central Intelligence George J. Tenet in Senate testimony earlier this year.

Iran's Military Buildup

In recent years, Iran has been attempting to build up the strength of its conventional military forces. One apparent aim of Iranian commanders: an increase in the ability to project power in its region.

Thus, earlier this year, Iran took delivery of a shipment of North Korean gunboats that US intelligence believes will be converted into guided-missile warships. Combined with other recent naval and coastal defense acquisitions, which range from Russian Kilo-class submarines to Chinese Silkworm anti-ship missiles, the new boats could help Iran control important sections of the Persian Gulf in a crisis--including the strategic Strait of Hormuz.

Iranian officials also appear to believe that they need to increase the deterrent value of their forces, given Iran's inclusion in President Bush's axis of evil. This September, Iran's defense minister, Rear Adm. Ali Shamkhani, blustered that the United States should think twice before targeting his nation.

"It is with a gigantic support of the ... well-prepared armed forces and our powerful military capabilities that Iran will react to any foreign violation," he told Iran's official news agency IRNA.

Those armed forces have indeed come a long way since the Iran-Iraq war. Epic, World War I-style battles with Saddam destroyed about 60 percent of Iran's heavy land weapons, according to Western estimates.

Today, with a population of more than 65 million to draw from, Iran has about 513,000 men in uniform. Another 200,000 to 350,000 are in the reserves, estimates Center for Strategic and International Studies expert Anthony H. Cordesman.

The army totals around 450,000 men. Of these, about 125,000 are Revolutionary Guards--ideological elite units formed after the fall of the Shah in 1979 to protect Iran's new theocracy. Iran's inventory of main battle tanks stands at roughly 1,100, with 1,200 other armored vehicles and more than 2,500 major artillery weapons.

The army also has about 100 AH-1J attack helicopters, but the readiness of these aircraft is unlikely to be very high.

At one time Iran's air force was one of the most highly capable in the developing world. The Shah's appetite for US fighters was such that before his ouster he considered chipping in to help pay for development of the F/A-18.

Today, Iran has only about 150 aging US-built aircraft left. These include 66 F-4D/Es and 25 F-14-A/Bs, which are about 60 percent serviceable, according to a net assessment drawn up by Cordesman. Iran has long tried to evade the US embargo on parts for these airplanes by purchasing through third parties.

The backbones of the Iranian air force today are 24 Su-24 Fencers and 30 MiG-29 Fulcrums. These Soviet-era aircraft are about 80 percent serviceable, claims Cordesman. If Iran acquires a nuclear weapon, the Fencers could be used as an interim delivery capability, pending perfection of an adequate ballistic missile.

Iranian units also include 14 RF-4E and five P-3F reconnaissance aircraft. The air force has a limited aerial refueling capability. Air defense relies mainly on 100 Hawk missiles from the Shah's era, with a scattering of newer, shorter-range Soviet- and Chinese-made models.

Iran's navy is one of the more capable maritime forces in the region. It has 10 Kaman missile patrol boats and 10 Houdong missile patrol boats--most equipped with C802 anti-ship missiles-- along with three missile frigates and two corvettes. Western naval analysts are perhaps most concerned about Iran's five submarines, which given the constricted nature of the waterways in the region could close ship lanes for at least a short period of time.

Iran is currently seeking more modern fighters and surface-to-air missiles, such as the Russian S-300 series, claims Cordesman. It has been unable to modernize key capabilities such as airborne sensors, electronic warfare, command and control, and air defense integration.

Overall, "Iran has not ... been able to offset the obsolescence and wear of its overall inventory of armor, ships, and aircraft," Cordesman told the Senate Foreign Relations Committee in August.

The WMD Issue

Iran has for years had an across-the-board program of WMD development. Although it is a party to the Chemical Weapons Convention, it has produced and stockpiled blister, blood, and choking chemical agents, according to US intelligence. It has a biological weapons arsenal and may be able to indigenously produce enough fissile material for a nuclear weapon by late this decade, says a CIA estimate.

Iranian officials have spoken openly of their desire for missiles with a range beyond that of their Shahab-3, which can hit targets up to 800 miles away. The CIA believes Iran may flight-test a missile of intercontinental capability later this decade. The Iranian military has already deployed unmanned aerial vehicles, including some configured for attack, and may be seeking more sophisticated such aircraft to serve as a WMD delivery capability.

Assistance from Russia, China, and North Korea that Administration officials have called "sustained cooperation" may be helping Iran's WMD work along. The US has long pressured Russia to cease its help in constructing Iran's Bushehr nuclear power plant, for instance, with little success.

The Bushehr plant was begun in 1974 with German help and was bombed three times by Iraq during the Iran-Iraq war of the mid-1980s. Iran says it needs electricity from the plant to bolster its energy production. But Administration officials say that is unlikely. They point out that Iran, a major producer of natural gas, is already venting into the atmosphere gas that could produce three times as much energy as a Bushehr-sized reactor.

"What's going on is Iranian recognition that possessing the Bushehr reactor will allow them to argue to have all of the other bits and pieces of a domestic nuclear infrastructure that ostensibly is designed to support the civil power plant but in reality, we feel, is designed to support nuclear weapons ambitions," said Marshall Billingslea, principal deputy assistant defense secretary for special operations and low-intensity conflict, at a Senate hearing this summer.

Why Be Surprised?

Nor should the world be sanguine that it still has a few years to head off Iran's nuclear program. Too often predictions of possible proliferation have turned out to be too optimistic, Billingslea told Senators. For instance, after the first Gulf War, US investigators were shocked to discover that Saddam had been but one year from completing his own atomic weapon.

"We keep allowing ourselves [to be] surprised," said Billingslea. "We shouldn't do that."

The US concern about Iran's weapons programs is heightened by the regime's continued support for terrorism. In fact, it is arguably Tehran--not Baghdad--that is the terror capital of the Middle East. The US State Department has judged Iran the world's most active state sponsor of terrorist acts, with both Iran's Islamic Revolutionary Guard Corps and Ministry of Intelligence and Security providing planning, funds, and weapons.

"Although some within Iran would like to end this support, hard-liners who hold the reins of power continue to thwart any efforts to moderate these policies," said the most recent edition of the State Department's "Patterns of Global Terrorism."

Iraq's primary contribution to anti-Israeli terror groups, for instance, has taken the form of cash payments to the families of Palestinian suicide bombers. Iran's support has been far more substantial. It spends an estimated $100 million a year on Hezbollah and may even have dispatched Iranian Revolutionary Guards to help operate some of the group's heavy weaponry in Lebanon. Tehran has intensified support of Palestinian rejectionist groups since the beginning of the latest round of Israeli-Palestinian violence, to the point where it dispatched explosives and weapons to the Palestinian Authority forces aboard the Karine A freighter, which was seized by Israeli authorities. Anti-Israeli rhetoric from Iran's ruling mullahs is virulent: Supreme Leader Khamenei refers to Israel as a "cancerous tumor" that must be cut out.

Iran has also provided limited support to terrorist groups in the Gulf, Africa, Turkey, and Central Asia, according to the State Department. And there are still unresolved questions of Iranian complicity in the 1996 bombing of the US barracks at the Khobar Towers in Saudi Arabia.

"The Iranian regime's support for terrorist activities--which have killed at least hundreds of thousands of innocent civilians, including Americans--is inconsistent with the desire of the Iranian people for Iran to fully join the community of nations," said Khalilzad in his August speech.

The US did see some positive developments in Iran's international behavior during Operation Enduring Freedom. At the beginning of hostilities in Afghanistan, Iranian officials quietly informed the US that if American warplanes happened to go down in Iranian territory their crews would be assisted in accordance with international conventions. As a committed foe of the Taliban, Tehran pledged to close its borders to al Qaeda attempting to flee over the Iranian border. Iran also worked with the US and its allies at the Bonn conference in late 2001 to help set up the Afghan Interim Authority.

Aiding al Qaeda

But later actions didn't match Iran's words. Hard-line elements in Iran in fact helped al Qaeda terrorists escape. For months, as Taliban resistance crumbled, the Iranian government did nothing to arrest and extradite al Qaeda, according to US officials. Instead, it insisted that no terrorists from Afghanistan were finding their way into Iranian territory at all.

Only after repeated complaints from President Bush and other US officials did Tehran admit that there was an al Qaeda presence in Iran. Finally, it extradited some suspects in custody to their country of origin and Afghanistan.

Iran has said it supports Afghan President Hamid Karzai's government. But it has also sent forces associated with its Revolutionary Guards over the border into Afghanistan and appears to be supporting some regional leaders without Karzai's knowledge or consent.

"While Iran's officials express a shared interest in a stable government in Afghanistan, its security forces appear bent on countering the US presence," said Tenet earlier this year. "This seeming contradiction in behavior reflects deep-seated suspicions among Tehran's clerics that the United States is committed to encircling and overthrowing them."

US military operations in Iraq could well exacerbate increased tension in the US-Iranian relationship.

On the one hand Iran is, if anything, a more bitter foe of Saddam Hussein than is the US. The Iran-Iraq war of 1980 to 1988 was a gruesome conflict more akin to World War I trench warfare than modern battles. Both sides suffered hundreds of thousands of casualties. Iranian troops were attacked with Iraqi chemical weapons.

Iran has sheltered anti-Iraq dissident groups, including some that might participate in the formation of a post-Saddam government, according to Washington's plans. And it has actively fostered and funded one such organization--the Supreme Council for the Islamic Revolution in Iraq, an umbrella group for fundamentalist Shiites, drawn from Iraq's south, who oppose Saddam's rule.

On the other hand, Iran remains bitter that much of the world leaned toward Iraq during their mid-80s conflict. The United States certainly did. And Tehran may well fear that once Saddam is out of the way, the Bush Administration may turn its eyes on them. Iranian Foreign Minister Kamal Kharrazi said in September that while his nation would respect any UN resolutions dealing with the Iraqi situation, it would not participate in any war. Unilateral US action to oust Saddam, Kharrazi said, would set a "dangerous" precedent.

US officials have been publicly mum on whether they would try to topple the government of another evil axis member if their efforts in Iraq prove successful. Iran--with a relatively modern military and a complex, multilayered government and civil society--would be much more difficult than Iraq to change by force.

Instead, the bottom line of the US policy change toward Iran announced this year appears to be that the Bush Administration has given up on President Khatami as ineffectual and thus has given up on efforts to influence Iran from within. Instead, President Bush appeared to be offering his support to grassroots groups, such as student dissidents, as they push for change from outside Iran's existing systems.

After all, the support Bush offered in his statement broadcast into the country was not directed to chimerical government moderates but to the Iranian people themselves, as they "move towards a future defined by greater freedom."