How to Get a Deal With Iran: Former US Negotiator Wendy Sherman on Power, Pressure and Reality

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2:07I don't think negotiations are about trust. That word is thrown around a lot. I don't trust Iran. But I do think you have to have some respect that your adversary has interests. You may not agree with their interests. At the end of the day, it's a negotiation, so they have to get something out of it. Wendy Sherman, diplomat and negotiator on how to unlock a deal with Iran. So how do you think this is going to end? What will happen to that stockpile of highly enriched uranium? It's not like you can resolve that in a day. It is a complex, tedious operation under very difficult security arrangements.

2:50From Bloomberg Weekend, this is The Michelle Hussain Show. I'm Michelle Hussain.

3:00Before we head into another episode relating to tension and war in the Middle East, I thought I'd try and capture some of the sentiment around these past eight weeks, at least as I see them. Because for me, there have been moments of intensity, military ones for sure, but I'm also thinking threats and rhetoric. And those have come alongside a backdrop of ongoing crisis. At times, it's been really hard to keep up because events have been zigzagging between force and diplomacy. And I do wonder if we'll look back on these days and be able to see clearly eras that began or ended here. If you've been listening to the show in this period, you'll know already that we've been looking at events from different angles.

3:50So Bernard Haeckel on the Saudis, Fawli Nasser on Iran's leadership, Shira Efron on Israel, Malihal Lodi on Pakistan. And by the way, if these names are new to you because you're listening for the first time, welcome. And I do recommend those episodes because what each of them unlocked for us is still of value. And for this weekend, we've turned to Wendy Sherman, because she was the key person in the room for the United States in the last negotiations with Iran. So when J.D. Vance looks across the room at the Iranians, she knows what that's like. Her work led to the nuclear deal that Donald Trump later ended.

4:32She's a former U.S. Deputy Secretary of State. And when we sat down together in Bloomberg's Washington, D.C. studio, I had a copy of her memoir flagged with post-its right in front of me. We do go beyond the Middle East in this conversation to China and to Russia. But for obvious reasons, we began with Iran and what she knows that the rest of us might miss. I think that it's quite critical for people to understand Iran's culture, its history, its people, its government, its theology. It's very different than American or Western sensitivities. It is a culture of resistance. When the 1979 Iranian Revolution happened, it was really a reaction to what we and the British had done in 1953 when we knocked off a prime minister because we were afraid that Iran was going to nationalize the oil industry.

5:37And we thought that would hurt us, oil being the constant here. And so we put in the Shah of Iran, who was probably good for us Westerners, but terrible for Iran. He was quite oppressive, quite a dictator. And it led to the 1979 Islamic Revolution. And it is remaining a culture of resistance. So every time President Trump tries to bully Iran, Iran has immense pride and dignity. It's not something we all understand because they're a terrible regime that slaughtered protesters in the street, but it is who they are. I imagine that this kind of sweep of history, which you're describing right now, this must have been what it was like when you sat in those rooms with Iranian negotiators.

6:26Did they lecture you along these kinds of themes? We certainly at the beginning of the negotiations had lots of lectures from those who were in Tehran. Over time, however, we just got down to the brutal details of this negotiation. When you're negotiating around nuclear issues or military issues or proxies, the devil is definitely in the details. But the fact that you're mentioning the historical context now, does that mean that you are saying that the Trump administration needs to understand this and doesn't and they will only get so far if they don't? Without a doubt. The regime now is more hardline than even the previous supreme leader, who was pretty hardline.

7:15And I think there's a great deal even more control by the Islamic Revolutionary Guard Corps than there was before. And that means that the concessions the president thinks will come easily will not come easily. They will resist. They will never, I believe, give up what they believe is their right to enrich. They may voluntarily suspend it, but they won't give up the right. I don't think they'll give up their relationship to their proxies. They may reduce the level of their support. I don't think they'll give up their missile program, though they may be willing to constrain it in some ways. So I don't think that when President Trump wants them to really just capitulate, that's never going to happen.

8:04But precisely because it is such a hardline regime, harder line, you're saying, than the one you dealt with, isn't there therefore a role for this kind of maximum pressure strategy, the keeping Iran on its toes, the constant changing of position, the overwhelming use of military force, for example, the Navy has been destroyed. Does that give the United States a point of leverage? I think that there always in these kind of negotiations needs to be a credible threat of force. And in this case, perhaps even the use of some of the mechanisms the president has used. But I think he believes not only in a madman theory, which is act crazy and people will not know what you're going to do.

8:48But I think he doesn't have a strategy. I think he's very tactical, very transactional, as he was as a builder, as a developer. And in this case, I don't think that transactional approach will actually work in the end. It may get him some leverage, but I don't see an overall strategy and I don't think it's been clear what he really will consider success. Sarah Longwell, who's the publisher of The Bulwark, certainly not a progressive magazine, she's a neoconservative, has said that the president is committing superpower suicide. And I think that's a good description because what he has done has cost our alliances, has cost our American taxpayers and, of course, 13 American lives and an enormous cost to our military, to our inventory of weapons, to our ability to project our power abroad.

9:46And I imagine you would never have had a positive view of Donald Trump and his foreign policy, right? You worked in the Biden administration. You worked for the Obama administration before that. So his worldview would never have been yours. I'm not sure what his worldview is. My greatest concern, Michelle, is not any specific thing he does. It's does he have a plan? Does he have a strategy? Or does he just go by impulse every day about what he thinks he needs to do next? and sometimes that's useful to trust your gut and your instincts, but not every day in every way. So no, I'm not a supporter of the presidents, but I am a supporter of the United States of America and I am a supporter of American foreign policy and American power.

10:44But I think our projection of power should be to get to a good result and you need strategy before you take action. I want to use your expertise to dig into some of the latest news lines at the point that we're speaking. What is most worrying to you? And it's hard to know where to start in terms of the dramatic instances of the last few days. For example, the U.S. firing on an Iranian ship, Iran also reportedly firing on Indian ships, blockade by the United States and also the closure of the Strait of Hormuz by Iran. What stands out to you? I think the last point really stands out to me and is another downside of what's occurred.

11:29Before this war, the Strait of Hormuz was open. There was freedom of navigation. It was important to the world's economy. Now, I think Iran will always believe that they have control over the Strait of Hormuz. Even if they open it up again, which I certainly hope happens, we all know they can close it again. They may exert other kinds of control, tolls, approval by the IRGC. I have no idea where this will all end, but that is of great concern because freedom of navigation is critical to the world economy. And are you saying that they will always be able to close it again, even if the U.S. continues a blockade, even if the U.S.

12:13sends more military assets to the area, even if the U.S. wipes out even more Iranian military assets? Well, certainly we can do that, but it would come at enormous cost to us. And the strait, as I think everybody has now seen on a map, is a very narrow channel. And along the coastline are Iranian military assets. And we have all seen both in the war in Ukraine and now in the Middle East, drone technology has changed how wars are waged. And so Iran will always have capability. And yes, there is no question that President Trump has diminished Iran's capability, has destroyed their Navy, but not their fast boats, not their drone technology.

13:04They haven't bombed away their nuclear knowledge. Yes, they have pushed the highly enriched uranium underground, but they have not bombed away all of Iran's knowledge. And it may take them time to reconstitute their missiles, their navy, their nuclear program. All of that may be true, but I think they will try to do so. And do you think that actually the Strait of Hormuz could be controlled and kept closed, even with a few men with small arms on speedboats? It certainly will make it concerning for shippers. Shipping is about insurance and whether insurers feel there's adequate security to let those ships go through.

13:48And so at the end of the day, that's a decision the ships will have to make. And even in the brief time when it was, quote unquote, open again, the insurers didn't think it was safe enough to send the ships through. And that's really the bottom line here. Before we talk about the Iranian officials you know, some of whom are in even more prominent positions than they were when you were negotiating, what are you hearing about the president himself? Do you think he is well? There's been increasing talk in the last week or so about the extent to which he is posting through the night, about the nature of his decisions.

14:31Some people feel that we are moving into a different era in terms of his decision making. I can't begin to know what is in President Trump's head. I'm not sure he knows from moment to moment. He's always tweeted at night. He is a night owl. He starts his day late. I don't think that's new. But I do think his impulse behavior has increased. And that is of great concern to me. I'm not sure he understands the stakes here. It's not about just winning this war. It's about what it means for America going forward. He's due to go to China in May to meet with President Xi. I think he's going to go in a weakened position, no matter how things turn out.

15:23Because even if an agreement is reached, it will be principles. It will be broad outlines. And then people will have to do all of the details, which will take weeks, if not months, if not over a year, to resolve. And so there will be this disequilibrium for a very long time in the Middle East. We have allies in the Middle East who are now saying, send us your dollars or we're going to have to use Chinese yuan to be able to go through the Strait of Hormuz. People have turned to China to build a trade relationship because they don't feel they can rely on the United States anymore. Some of our best allies, Canada, the UK, have said they can't rely on us and have beaten a path to China.

16:11This should be of great concern to all of us. But can I take you back in time? Because one of the things I noticed in your book, which I found really striking in the present context, is the keeping allies out at key moments. I see what you're saying about this is a whole different degree, but elements of this have happened before, haven't they? In your book, you describe the secret back channel that you were part of with Iran and the moment that you had to go to Brussels and tell the Europeans that there was a complete draft agreement between the US and Iran in place of which they knew nothing.

16:45Indeed. I think everyone understands and certainly understood then that if we could not get an agreement, it would be the American military that would have to intervene and try to change the calculus of Iran. And everyone understood that no deal would be made unless it was a deal the United States could agree to. No one likes that we have an equal power. I understand that, but everybody understands it. So my European allies, Kathy Ashton was the high representative at the time. She was not shocked. She was not surprised. My European allies were not happy, but they were not shocked. And Russia and China, who were part of this negotiation, also were not shocked and actually were sort of happy that things were moving along, that President Obama had made a very courageous decision in opening up this channel.

17:44So, yes, the U.S. has unequal power. It is undoubting, undoubtable among the world. But we have to be humble about it. We have to have humility. Do you accept, then, that this is a version of what has happened before rather than an entirely new development? I mean, do you actually to keep a secret like that from people who are on the same side as the United States as far as Iran's concerned? So, no, I don't think it's the same because I think this is of such a magnitude. And it's not just about Iran. We brought all of our European allies in. We brought Russia and China in. We went to the United Nations.

18:23I spent an enormous amount of time talking to the Gulf Arab states, an enormous amount of time talking to Israel, to Australia, to anybody else who wanted to talk about what we were doing. So we were as transparent as we possibly could be in a timely fashion. And that deal that came in through the secret channel had brackets in it. There were still some things to be negotiated. And the ministers came together and, in fact, didn't agree initially to what we had put on the table. We're quite unhappy about it, actually. So some changes were made. So people had input. America acted with its power, but we did not act alone.

19:06And a key point person on the other side at that time was Abbas Aragchi, who is now Iran's foreign minister, who was there at those Islamabad talks. What should we know about him? What was your experience of him? He is very smart. He is very tough. His English is quite good. All the negotiations were in English. Before we had the negotiation led by Foreign Minister Javad Zarif, and Arachi was one of his deputies, we had a negotiation with Saeed Jalili. And Arachi was on his team, but we never knew he spoke English because everything was done in Farsi. So Arachi's very tough. He can get angry. He is part of the revolution.

19:58He was part of it then. He has bona fides. He had a strong relationship with the Islamic Revolutionary Guard Corps. Even though he's getting some criticism now, I think some of that is drama. So you'd seen him around these rooms, but you didn't realize that he spoke such good English until suddenly you were negotiating with him. It was quite astonishing. I don't even think we all recognize he was part of the delegation when Jalili led it. but then things changed dramatically. Am I right in thinking that you did develop something of a bond with him, that these were difficult talks, but there was something of a relationship that formed?

20:39Yes. Now, I want to be clear. I don't think negotiations are about trust. That word is thrown around a lot. I don't trust Arachi. I don't trust Iran. He doesn't trust me. They don't trust me. In fact, at one point, there was death to Wendy Sherman on the streets of Tehran. That was because of something you had said about Iran, which became essentially a news point there. Exactly. We got past that. But I do think you have to have some respect that your adversary has interests. You may not agree with their interests. You may think they're horrible. And I think the regime is awful. But they do have interests.

21:21And so you have to understand that. And even though it was an unequal negotiation, we were the demandeur, they were the adversary. At the end of the day, it's a negotiation, so they have to get something out of it. I'm going to quote a part of your book where you describe this experience. Amid the host of topics, nuclear and non-nuclear, cultural and political, that we could not talk about, Aragji and I made a permanent human connection. Years after the end of the negotiations, Araqchi still sends me a greeting at Christmastime, and I send him greetings at Nauru's, the Iranian New Year. Although I don't, as a Jew, celebrate Christmas, I do appreciate the holiday sentiment.

22:00We don't know how our human connections may yet serve the world. Did you this year on the Iranian New Year send him a greeting? No, and we haven't been in touch in years now. Since the first Trump administration, no. all of the ties were broken. So no, I haven't been in touch at all. And, you know, as I wrote in the book, he and I became grandparents at the same time. So we showed each other pictures of our infants. I had a discussion with he and Takravanchi about being Jewish. They knew I was Jewish. That was sort of strange. I couldn't shake their hand because I was a woman. And I had a conversation with the two of them on the margins once saying, you know, we really have something in common.

22:54I grew up in a Jewish community where there were Orthodox Jews and men could not shake my hand. And at first they were sort of stunned that I was having this conversation. But then we talked about it. And some of it was real and some of it wasn't. We all knew each other well enough to know some of it was trying to reach across to understand each other. But it just creates a human bond. Again, it doesn't change that they have interests and they're going to negotiate as tough as they can. It didn't change what the president, what the secretary of state had tasked me to do, but we could sort of take down the veil a little bit to be able to deal with each other.

23:39Because for 28 days at the end of this negotiation, we were all in a hotel together. I ate one meal outside that hotel. And you can't spend that much time, same with my European and Russian and Chinese colleagues, without getting to know each other. Did you hesitate about telling the Mewa Jewish? No, because I knew they knew. Likewise, it was a very strange circumstance. The negotiation was coordinated by the high representative of the European Union, first Kathy Ashton, then Federica Mogherini, two women. Their deputy was Helga Schmidt, a wonderful German diplomat who was seconded to the European Union, a woman, and then me, head of the U.S.

24:24delegation. And I had women in my delegation, but the other delegations at the start did not have women. But over time, everybody found a woman to bring because I think they thought they could deal with a high representative, with Helga and with me better if they had a woman on their delegation. And I'm glad for that if I helped other women rise up a little bit. Of course, that is completely absent now. And any women in the room on the American side or the Iranian side. Indeed. Indeed. Well, there were never on the Iranian side. But it's interesting, so many of the reporters and press people from Iran are women.

24:57So what about the absence of women on the American side? Does that jump out to you as you look at, like, the pictures of the talks in Islamabad? And presumably, it'll be the same kind of scene if it happens again. Well, it certainly jumps out at me, but doesn't surprise me. But what I care about here is that we get to a good end. And if the president of the United States and his team, which I think is not really well seasoned to do this negotiation, if they come to an agreement that is good for our country and for the world, I'll be for it.

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28:01Let's talk then about what a deal could look like to resolve this, because you've got the American demands on one side an end to enrichment, an end to the ballistic missile program. On the Iranian side, they'd like an end to sanctions. I'm simplifying. What do you think the landing zone could be for a deal? Well, what we've heard, what's been reported, is perhaps the suspension of their enrichment program for X number of years, whether that's 10 or 15 or 20, I don't know. And it would have to be monitored and verified by the International Atomic Energy Agency. And it would have to be quite an intrusive kind of monitoring and verification.