On June 9, Bloomberg.com posted an article about one unfortunate result of President Obama’s treaty with Iran.

In January, the U.S. Treasury transferred $1.7 billion to Iran’s Central Bank. Last month Iran’s Guardian Council approved an Iranian 2017 budget that instructed Iran’s Central Bank to transfer the $1.7 to the military.

The article reports:

Saeed Ghasseminejad, an associate fellow at the Foundation for Defense of Democracies, spotted the budget item. He told me the development was widely reported in Iran by numerous sources including the state-funded news services. “Article 22 of the budget for 2017 says the Central Bank is required to give the money from the legal settlement of Iran’s pre- and post-revolutionary arms sales of up to $1.7 billion to the defense budget,” he said. 

Republicans and some Democrats who opposed Obama’s nuclear deal have argued that the end of some sanctions would help to fund Iran’s military. But at least that was Iran’s money already (albeit frozen in overseas bank accounts). The $1.7 billion that Treasury transferred to Iran in January is different.

A portion of it, $400 million, came from a trust fund comprising money paid by the government of Shah Mohammad Reza Pahlavi, a U.S. ally, for arms sold to Iran before the 1979 revolution. Those sales were cut off in 1979 after revolutionaries took over the U.S. Embassy in Tehran and held the American staff hostage for 444 days. The remaining $1.3 billion represents interest on the $400 million principle over more than 36 years.

The article notes that we are already subsidizing defense spending for Egypt and Israel. Essentially we are supplying money for arms to both sides in the Middle East. How does this ever lead to peace? Anyone who understands the Middle East also knows that at least some of this money will be used against U.S. soldiers. Why are we funding the enemy that is killing our soldiers?

The article concludes:

The irony here is that Iran has been pleading poverty in recent months. The country’s supreme leader and foreign minister have publicly complained that Iran’s economy has not seen the benefits expected from the Iran nuclear deal. And yet Iran’s 2017 $19 billion defense budget has increased by 90 percent from 2016, according to Ghasseminejad.

We now know where $1.7 billion of that came from.