The Secret History of How a Downed Airplane Rekindled U.S.-Iranian Ties

A previous disaster, and its aftermath, suggests now is the perfect time for Washington to start talks with Tehran.

Relatives of victims of the Iranian Airbus shot down by a U.S. Navy cruiser in 1988 over Persian Gulf waters stand under a painting depicting the scene during a ceremony in the Iranian port of Bandar Abbas on July 3, 2003.
Relatives of victims of the Iranian Airbus shot down by a U.S. Navy cruiser in 1988 over Persian Gulf waters stand under a painting depicting the scene during a ceremony in the Iranian port of Bandar Abbas on July 3, 2003. STF/AFP via Getty Images

In the aftermath of the killing of Iranian Quds Force commander Qassem Suleimani and Tehran’s retaliation, the prospects for diplomacy between the United States and Iran look grim. U.S. President Donald Trump is committed to his campaign of “maximum pressure” against Iran in an election year, while Tehran is defiant in the face of the assassination and severe economic constraints.

While there is little promise for U.S.-Iran talks in 2020, some observers have suggested that the diplomatic deep freeze could last much longer. For example, the analyst Barbara Slavin wrote: “Any chances for American diplomacy with Iran are dead for the duration of the Trump presidency — if not longer.” Former U.S. Secretary of State John Kerry said Trump had “abandoned the possibilities of diplomacy,” and former Obama administration officials William Burns and Jake Sullivan argued that the Suleimani assassination meant the “death” of “the whole notion of diplomacy with the Great Satan.”

But the history of relations between the United States and Iran provides reason to be sanguine, if not optimistic, that pragmatism on both sides can lead to a rapid resumption of diplomacy even after catastrophe. Leaders and candidates in both countries should note the precedent for a quick turnabout in relations—and be prepared to move beyond decades of animus when opportunities arise.

This month’s conflict was dramatic but was neither unprecedented nor even the bloodiest engagement between the United States and Iran over the past 40 years. The closest parallel is the events of April through July 1988, at the tail end of the Iran-Iraq War. In a short period, the U.S. and Iranian armed forces clashed directly, and more than 330 Iranians were killed.

On April 14, 1988, a U.S. warship deployed to the Persian Gulf struck an Iranian mine, severely damaging the vessel. The ship was part of an American naval mission in the Gulf to protect commercial shipping that had come under attack by Iran. The United States confronted the Iranian navy four days later, destroying or disabling half of its vessels, killing 77 Iranian sailors and Revolutionary Guards, and wounding more than 100. Then, in July 1988, a U.S. warship pursuing Iranian vessels accidentally shot down an Iranian passenger plane, killing 290 on board (254 of whom were Iranian), a tragic mistake similar to the one Tehran itself committed this month.

Many analysts remember the end result of these clashes: Iran concluded that the United States had decisively entered the war on Iraq’s side and decided to seek a cease-fire. But few recall that less than two years later, the two sides began negotiating.

Under the presidencies of George H.W. Bush and Akbar Hashemi Rafsanjani, the U.S.-Iran relationship shifted from confrontation toward cooperation and, haltingly, detente. Bush made the first move in his inaugural address in January 1989, imploring Iranian leaders to free U.S. hostages in Lebanon and promising that “good will begets good will.” He authorized direct and indirect negotiations with Tehran and ordered his administration to “be prepared for a normal relationship with Iran.” The change in U.S. tone resonated in Iran, which was squarely focused on postwar reconstruction. Rafsanjani accepted Bush’s offer, telling an intermediary that he “would like to put the past behind [them] and work out the future.”

Between April 1990 and December 1991, Iran facilitated the release of eight American hostages in Lebanon—the Bush administration’s paramount demand. After Iraq invaded Kuwait, Iran also provided significant assistance to the U.S.-led coalition. The conflict placed the United States and Iran on the same side, and Iran committed to quietly help the eventual U.S. war effort. Rafsanjani agreed to enforce U.N. sanctions, impound Iraqi aircraft, rescue downed pilots, and ignore fighter jet and cruise missile flights over Iranian territory. While Iran’s options were admittedly limited because the world’s most powerful military was flexing its muscle right next door, the Bush administration still saw and pursued an opening for further diplomacy.

The United States ended the embargo on importing Iranian oil in late 1990, increasing U.S. purchases of Iranian oil from $7 million per year to $265 million. Washington also supported a $250 million World Bank loan to Iran—its first since the revolution—and agreed to pay Iran $278 million in a separate settlement. In addition to economic benefits, the United States helped Iran achieve a major diplomatic victory: a formal U.N. conclusion that Iraq deserves full blame for starting the eight-year war with Iran. To build on these moves, the White House began a comprehensive, secret review of its policy toward Iran.

Ultimately, the period of diplomacy was short-lived. The Bush administration was alarmed that while Iran cooperated with Washington on hostages and in the Gulf War, it was simultaneously expanding its nuclear program and terrorist activities. Tehran went on a nuclear spending spree, attempting to acquire technology and assistance from China, India, Argentina, Germany, and Russia. Iran’s purchases had plausible civilian purposes, although the Bush administration was concerned that they were also important to a nuclear weapons program.

The United States also considered Iran responsible for the March 1992 attack on the Israeli Embassy in Argentina that killed 29 civilians and injured more than 240. The attack was allegedly carried out by Lebanese Hezbollah, with Iranian support, in retaliation for the Israeli assassination of the Hezbollah chief the month prior. It is unlikely that Rafsanjani or forces within Iran were intentionally seeking to sabotage the improvement of relations with Washington, but the effect was the same: The Bush administration decided by April 1992 that the warming with Iran was a mistake.

Although it ended without a lasting detente, the relaxation of tension from 1990 to 1992 was real and significant. It suggests that even in the aftermath of crisis and tragedy, it is possible for pragmatic leaders to chart a path forward if they abandon maximalist demands and take reciprocal measures to build confidence.

This could apply even if Trump is reelected. It is true that the change of administration in 1989, from Ronald Reagan to Bush, was a spark to negotiations: Bush was a strong proponent of diplomacy, not just with Iran but also the Soviet Union, Germany, and with Arabs and Israelis. But, for Iran, Bush was not necessarily a breath of fresh air. One month after the airline shootdown in 1988, Bush said in a campaign event: “I’ll never apologize for the United States of America, ever, I don’t care what the facts are.” Bush was talking about the U.S. role in defending freedom in Poland and elsewhere, but many Iranians to this day consider Bush’s comments a disdainful reference to the shootdown. Nevertheless, economic necessity drove Iran to compromise—as could well happen if Trump is reelected.

Regardless of the president, the core diplomatic challenge is that Washington and Tehran cannot simply reenter the nuclear agreement—the United States removes sanctions, Iran ends nuclear violations—and call it a day. Key limits on Iran will begin to expire before the 2024 U.S. presidential election, and the most significant restrictions begin lapsing in 2026. For its part, Iran complained that existing U.S. sanctions meant it never received the economic windfall it expected; more concessions from the United States will be required. The United States, Iran, and other world powers would need to embark on a multiyear negotiations effort to refine just the nuclear agreement, let alone discuss ballistic missiles, terrorism, and regional activity. And, as the collapse of the 1990-1992 rapprochement showed, external factors can easily get in the way.

The comparison between 2020 and the early 1990s is not perfect. Iranian domestic politics shifted dramatically between the 1988 clashes and the 1990-1992 period. The revolution’s founder, Ayatollah Ruhollah Khomeini, died. His successor, current Supreme Leader Ayatollah Ali Khamenei, was new to the job, as was Rafsanjani.

Moreover, the intervening 30 years have added grievances to both sides, and Iranians may well consider the assassination of Suleimani to be a much more dramatic offense than the clashes at sea in 1988. And while Trump professes an interest in negotiations, his administration’s actions suggest otherwise.

Still, the lesson of the 1988 crisis followed by cooperation should not be ignored. Regardless of who wins the U.S. presidential election in November, the president should not assume that the actions of January 2020 have put a permanent deep freeze on the prospect for U.S.-Iran negotiations, provided that he or she is willing to embrace diplomacy and prioritize future relations.

Henry Rome is the senior Iran analyst at Eurasia Group, the global political risk research and consulting firm.

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