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Economic Forecasts

Can Obama Prevent an Attack on Iran?

He'll try to convince Israel to let sanctions work, but Netanyahu seems ready to act alone.

The government of Israeli Prime Minister Benjamin Netanyahu is very much flying solo in its campaign to whip up support for an immediate airstrike targeting Iran's nuclear sites.

SEE ALSO: Iran Tensions Will Drive Gas to New High

Just ahead of the annual convention of the pro-Israel lobby AIPAC (American Israel Public Affairs Committee), to be held in Washington on March 4, the Israeli government's demand that it be given a thumbs-up to attack Iran has reached a crescendo. But already having been rebuffed by European leaders, Netanyahu, at best, will get a face-to-face opportunity at the White House on March 5 to hear President Obama's reasons for rejecting Israel's military option at this time.

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Obama will urge Netanyahu to take a deep breath and think about the long-term ramifications, including the possibility that a military mission to take out Iran's nuclear capability won't succeed. Not surprisingly, the ultrahawkish Netanyahu has been deaf to Obama's pleas. In fact, Netanyahu is planning to go so far as to argue at the White House meeting that the U.S. should join in on any strike against Iran.

No matter the end result, the Israel-Iran showdown will mean record-high gasoline prices for American drivers this summer. Even if Israel eventually stands down, uncertainty will push prices past the $4.11 zenith reached in July 2008, and perhaps up to $4.50 a gallon. And if Israel does unleash airstrikes, gas will top $5 a gallon and trim U.S. gross domestic product growth to about 1%. That's just one crisis -- natural or manmade -- from another recession. How long prices will stay that high depends on a number of factors, including whether Iran makes good on threats to block the Strait of Hormuz, the passageway for about one-fifth of global oil supplies.

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That brake on the economy would be politically dicey for Obama, since his hopes for a second term are very much tied to keeping the U.S. economy on a road to recovery. Republican presidential hopefuls are already beating him up over gas prices, and will no doubt raise their voices even more when record levels are reached.

Israel is convinced that Iran is developing the capability to build nuclear weapons at underground facilities. Opposition to bombing is nearly universal from the White House, the State Department and the Pentagon, but U.S. officials suggest that Israel could strike as soon as April.

The biggest U.S. fear: Single strikes won't be enough to destroy fortified targets, and the U.S. will get drawn into an air war it wants to avoid. While there is no guarantee the U.S. would join the fight, it's hard to imagine the White House shunning a vital ally, especially in an election year.

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Like Obama, European leaders worry that the fragile world economy can't take the hit to oil prices that even a short-term war with Iran would trigger. The transatlantic allies also take seriously threats from Saudi Arabia, Egypt and Turkey that they, too, are inclined to go nuclear if Iran develops the capability to produce the bomb. None of that would be good news for Israel or the region.

U.S. officials hope to quiet Israel's war drums by demonstrating that economic sanctions against Iran are showing signs of working.

Iran has recently signaled a willingness to resume high-level talks, but taking Tehran at face value is a risk. And Iran has shown no signs of relenting on its nuclear designs. Since plans for a Chinese-built plant at Natanz were announced in 1996, Iran has not suspended its nuclear program for any reason.

Outside of Iran, there is near-universal agreement that Iran must be prevented from achieving the capability to build nuclear weapons, even as there is widespread debate about how far along the program is. And outside of Israel, there is near-universal agreement that Israel should be patient.

What matters at the moment -- for the global economy, for Middle East stability and perhaps for Obama's reelection efforts -- is how much of a threat Israel senses. The other wild card is how much pressure Netanyahu feels to act.

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