TigerHawk

Stratfor's annual forecast is out (subscribe here), and as usual it is chock full of limb-end predictions about the future. For your Saturday evening reading (assuming, of course, that your social life is only as exciting as my own), I have fairly used a large excerpt from the section on the Middle East (for which I repeat my admonition that you subscribe for yourselves rather than going to the mall this weekend and buying lots of stuff you don't really need). Analysis may, or may not, follow in a subsequent post, so you have the chance to beat me to the punch in the comments.

Our 2006 forecast said that the United States would succeed in creating a political solution in Baghdad that would allow for a drawdown in the Sunni insurgency and the implementation of a U.S. exit strategy from Iraq. For much of the year, this forecast held true: In June 2006, Abu Musab al-Zarqawi was killed in an airstrike followed by the complete formation of the Iraqi government and an announcement by the United States that it would reduce its force in Iraq by two brigades. Al-Zarqawi’s death signaled a commitment from the Sunni bloc to the political process, and it was then up to the Shiite bloc to reciprocate.

However, we made a critical error in reading Iran’s intentions at this point. The Iranians saw an opportunity to use their militant and political assets in Iraq to delay a political resolution through a major escalation in Sunni-Shiite sectarian violence. As a result, the United States was buried deeper in Iraq, and Iran was able to strengthen its negotiating position substantially. The Iranian strategy involved activating Hezbollah, which manifested in the summer war between Hezbollah and Israel that left Israel politically and militarily paralyzed. Contrary to our prediction that the general trend for the Middle East would be toward political accommodation, the region witnessed a number of flare-ups that were largely attributed to the Iranian calculus in consolidating its gains in Iraq.

We were correct, however, in forecasting that the Iranian nuclear issue would make its way to the U.N. Security Council, but no substantive punitive measures would be taken against Iran. In the Israeli-Palestinian arena, we correctly forecast that Hamas would emerge as a major player on the Palestinian political scene in the wake of the parliamentary elections in January, and that this would lead to major internal upheaval within the Palestinian territories. However, despite the gains it made in the elections, Hamas was unable to assume control of the security forces as we anticipated. We were right in saying that the Kadima Party in Israel would win the March elections and a center-left coalition would emerge, but would not be able to make significant headway toward unilateral disengagement from the Palestinian territories.

We also anticipated that Syrian President Bashar al Assad would be able to keep his regime intact despite the blowback incurred from the assassination of former Lebanese Prime Minister Rafik al-Hariri, and that fledgling militant Islamist movements in Lebanon would make their presence known in the Levant, but would not be able to ignite sustainable insurgencies. Regarding the al Qaeda movement, we accurately said the group would further devolve into local insurgencies, though the group did not end up losing its grip on Iraq as we anticipated.

The U.S.-Iranian standoff over the fate of Iraq will have a profound impact on the course of geopolitical events in 2007. After the 2003 U.S. invasion of Iraq, Iran seized the opportunity to assert itself as the regional kingmaker while the United States became increasingly paralyzed in Iraq. The United States now finds itself at a critical juncture: It no longer can afford to stay the course in Iraq and dedicate U.S. troops to an unattainable mission of securing the country solely through military force. As advocated by the Baker-Hamilton report, the time has come for the United States and Iran to stop giving each other the silent treatment and work toward a comprehensive settlement for Iraq.

But the United States is still far from its desired negotiating position, and thus will continue to shy away from the Baker-Hamilton report’s recommendations until it can level the playing field against Iran. Before Washington moves forward on the diplomatic front, it will need to disprove the perception that the United States has been permanently marginalized in Iraq and ultimately will have to withdraw its forces — something that would leave Iran to pick up the pieces and project Shiite influence into the heart of the Arab world. This perception of marginalization is what has driven heightening Sunni concerns that United States no longer will be the security guarantor against an empowered Shiite bloc, led by Iran.

To shatter these expectations and demonstrate that the United States is still very much in the game, U.S. President George W. Bush announced Jan. 10 a strategy to “surge” U.S. troops in Iraq. The increase will total 21,500 troops, with a peak of 17,500 in Baghdad and another 4,000 in Anbar province. Ultimately, this looks unlikely even to bring the total level of U.S. forces to their peak strength of 160,000 — the number of troops that were in Iraq in November and December 2005, in the buildup to the general elections Dec. 15. It is likely to be accompanied by a shift in tactics to focus more specifically on counterinsurgency operations.

The forces will certainly be useful — assisting with security inside Baghdad and leaving units that would otherwise be shifted to the capital available to confront issues in their respective areas of responsibility. However, in and of itself, this new deployment will be insufficient to turn the tide in Iraq. Operation Together Forward — the failed attempt after Abu Musab al-Zarqawi’s death to use a small surge in troop levels in Baghdad to impose security there — is a case in point. Together Forward was essentially the U.S. military’s last, best effort to secure Baghdad with the existing force structure.

Baghdad remains the key. Without stability there, there can be no Iraqi state. But the proposed surge of 21,500 troops — without a new, concerted diplomatic effort — is unlikely to succeed in effecting a political resolution in Baghdad.

However, there is a key psychological element to this strategy. The United States will spend the coming months taking an aggressive stance against Iranian operations in Iraq, including additional raids on Iranian diplomatic offices and arrests of Iranian officials in the country who are suspected of orchestrating attacks against U.S. and Iraqi forces. The U.S. military will be posturing to dispel the Iranian perception that the battleground will remain within Iraq’s borders. The United States could also step up covert efforts to ramp up the militant activities of Iran’s indigenous separatist groups, such as the Ahvazi Arabs in the oil-rich province of Khuzestan in western Iran. Coinciding with U.S. moves, Israel will accelerate its own psychological warfare campaign, using a variety of leaks and denials to heavily publicize Israeli military plans to strike Iranian nuclear sites. By upping the ante against Iran, the United States is placing a critical bet that the Iranians will reconsider their Iraq strategy and come to the negotiating table rather than risk a serious miscalculation.

To go along with the troop surge, the United States will focus on rearranging the Iraqi Cabinet to try to create a stronger, more functional government in Baghdad. This will involve sidelining allies of Shiite rebel leader Muqtada al-Sadr and bringing in a stronger Sunni presence, which will undoubtedly be a complicated and messy affair. Iraqi Prime Minister Nouri al-Maliki also could resign in as little as four months, triggering a struggle for power and a substantial flare-up in intra-Shiite frictions over his replacement. By the year’s end, Iraq’s largest and most influential Shiite party, the Supreme Council for Islamic Revolution in Iraq, might be better able to solidify its position in the government.

Iraq is unlikely to split up into federal zones in the coming year, but neither will it behave as a coherent state entity. Violence will escalate on all sides: Shiite, Sunni, jihadist and even Kurdish, with the Sunni-Kurdish fault line in northern Iraq becoming active toward the end of the year, as the Kirkuk referendum issue approaches.

For its part, Iran has been keen to bring the Americans to the negotiating table on its terms. It wields the ability, through militants, to manipulate the security situation in Iraq and thus to keep an effective government from taking power in Baghdad, but it lacks the means to impose a government of its own creation there. Tehran will focus this year on increasing the political and military costs to the United States of remaining in Iraq — by lending more support to militants there, including Shiite gunmen and segments of the Sunni insurgency — but ultimately, given the limitations and uncertainties on both sides, it is possible that a political settlement of sorts, however weak and tenuous, will be forged in 2007.

Iran will also use this year to push its nuclear agenda forward. The U.N. Security Council will be unable to pressure Tehran into curtailing its nuclear program. Iran will use the U.S. distraction in Iraq to move closer to its objective of becoming a full-fledged nuclear power, which will in turn strengthen Tehran’s bargaining position on Iraq and expand its influence in the region.

The United States and Israel are militarily occupied by Iraq and Hezbollah, respectively. The logic behind Iran’s strategy is to use this window of opportunity to advance its nuclear program to the point where a nuclear Iran will have to be accepted as part of any deal the United States wants on Iraq.

All the pieces might appear to be falling into place for Iran, but a major shake-up in the Iranian regime is likely to happen this year, and it could upset Iran’s calculus in dealing with the United States on Iraq. Iranian Supreme Leader Ayatollah Ali Khamenei is terminally ill with cancer and could die this year. His death will send a shockwave through the Iranian public, which will come to doubt the Iranian government’s ability to navigate the country through this critical period. There will not, however, be a complete breakdown of the Iranian political system. There are mechanisms in place to ensure the leadership transition goes relatively smoothly.

While his health further deteriorates, Khamenei will likely position former Iranian President Ali Akbar Hashemi Rafsanjani to lead the country. Rafsanjani is believed to be committed to Khamenei’s vision for Iraq and the ascendance of a nuclear-powered Iran, but he also is known for his pragmatic leanings and ability to negotiate more easily with the United States. Rumors are also circulating that Iranian President Mahmoud Ahmadinejad’s days could also be numbered, and that Khamenei will make the arrangements this year to remove the firebrand president from his post. Khamenei’s health will likely dictate whether Rafsanjani receives the position as supreme leader or president before the end of the year.

The United States will keep a close eye on any potential shake-ups in Tehran to decide how to proceed in devising a diplomatic strategy. The questions surrounding the Iranian leadership will ensure that 2007 will largely be a waiting game over the fate of Iraq. Israel will make a big show of the perception that its patience is rapidly wearing thin as Iran’s nuclear ambitions develop into reality. Israel’s focus for this year will be on pulling itself back together militarily and politically following its defeat in the 2006 summer war against Hezbollah. Israel is still unlikely to follow through with threats to launch pre-emptive strikes against Iranian nuclear facilities this year. Doing so unilaterally would only further compromise the U.S. position in Iraq once Iran unleashes its militant proxies in the region. Instead, Israel’s focus will turn toward Hezbollah. Iran made it clear during the summer war that it will use Hezbollah as a lever in negotiations over Iraq. Israel badly wishes to eliminate this lever, particularly since Israel has a pressing need to create conditions under which it could launch a pre-emptive strike against Iranian nuclear sites. Israel’s strategy to contain Iran’s nuclear ambitions begins with the crippling of Hezbollah’s militant arm. This rationale likely factored into Israel’s decision to go forth with a full-scale incursion into Lebanon this past summer, though the results surely defied Israel’s expectations.

Israel is likely to revisit its objective of crushing Hezbollah in the summer of 2007, and has already begun to justify a coming military escalation in Lebanon through public declarations that Hezbollah and/or Syria will be the one to instigate the conflict. Who ends up igniting the war is unimportant. The big question for this year will be whether Israel can develop the capability to root out Hezbollah forces in their strongholds in the Bekaa Valley. A good deal of restructuring will have to take place first, beginning with former Israeli Prime Minister Ehud Barak’s return to the political scene.

Israel could move indirectly to destabilize Hezbollah in Lebanon ahead of a military confrontation. Hezbollah is currently brimming with confidence, but it also must be careful to preserve its legitimacy. By provoking sectarian violence in Lebanon, Israel could pit Hezbollah fighters against fellow Lebanese, which would wear down Hezbollah’s military forces and tarnish its reputationas a nationalist movement, making the organization more vulnerable to an Israeli onslaught. The Israeli Mossad could also be engaged in attempts this year to eliminate elements of Hezbollah’s core leadership to further destabilize the party.

Though Syria will be busy building up weapons acquisitions from its defense partners in Moscow, the Syrian regime will be careful to avoid provoking a major military conflict with Israel. In elections slated for March, Syrian President Bashar al Assad will be re-elected by a wide margin, and no opposition forces will be strong enough to challenge the al Assad regime this year. Though Syria will keep the window open for talks with the United States, it will continue with its agenda to re-consolidate influence in Lebanon, which involves political intimidation — frequently in the form of assassinations. The Bush administration is unlikely to make any major overtures to Syria this coming year, knowing that Damascus falls well below Tehran in its ability to wield any real influence in Iraq. Syria will be emboldened through its alliance with Iran and could instigate a low-level insurgency in the Golan Heights through a shadowy group of militant actors on the regime’s payroll, but will play its cards carefully for fear of inviting Israeli airstrikes on its own soil.

Lebanon will become an intense battlefield for Sunni-Shiite influence, mainly played out between the Saudis on one side and the Syrians and Iranians on the other. The expiration of Lebanon’s lame-duck President Emile Lahoud’s term in office will come in September and will be preceded by intense political jockeying between Lebanon’s rival factions over his replacement. In the end, the next president will likely be a friend to the Syrians. Hezbollah will be able to expand its influence in the government by forcibly increasing the number of seats that it and its allies hold in the Lebanese Cabinet. With veto power, Hezbollah will be able to block any major legislation that harms Syrian, Iranian or Hezbollah interests, including disarmament of Hezbollah’s militant arm or any punitive measures against the Syrian regime for the February 2005 assassination of former Lebanese Prime Minister Rafik al-Hariri. While consolidating its political power, Hezbollah will intently focus on preparing for a military confrontation with Israel.

The Sunni Arab reaction to a rising Iran will intensify in the coming year. Though the Sunni Arab states are highly dependent on the United States to ensure their national security, they will make it clear that they are not going to sit idle while the United States fumbles around in Iraq. The Arab states, particularly Saudi Arabia and Egypt, will increase pressure on the Americans to act by strengthening the Sunni insurgency in Iraq and by showcasing plans to develop civilian nuclear programs to counter Iran. The sudden departure of Saudi Ambassador to the United States Prince Turki al-Faisal brought to light rifts within the Saudi regime over how to deal with Iran’s expansion at the expense of the U.S. military position in the region. Even though the kingdom has recently enacted a succession law to oversee the transfer of power, tensions over the Iraq situation could exacerbate matters. Moreover, Saudi King Abdullah has sought to bring in people from outside the royal family to fill key positions within the foreign policy establishment, which will further complicate these tensions.

Initially, King Abdullah chose advisers and strategists such as Adel al-Jubeir and Nawaf Obaid — a new crop of young, educated Saudis selected for their expertise — rather than members of the royal family. Although technocrats long ago replaced royal figures in the kingdom’s oil and economic sector, it seems the current king plans to gradually replace royals with technocrats in the foreign policy arena. An example of this was the appointment of al-Jubeir as Riyadh’s ambassador to Washington after Prince Turki abruptly resigned.

A Cabinet reshuffle could result in new oil and foreign ministers. While the Oil Ministry will continue to be managed by a technocrat, the Foreign Ministry portfolio would likely remain in the hands of the royal family. Despite disagreements within the top ruling circles on how to deal with an assertive Iran and the rise of the Shia in the region, it is unlikely that the key players within the House of Saud will allow these disagreements to lead to instability within the system — at least not while the sons of Abdul Aziz, the founder of modern Saudi Arabia, remain firmly in control of the reins of power.

Egypt’s political system has also entered a period of uncertainty, as President Hosni Mubarak — given his advanced age and hence deteriorating health — could either die or become incapacitated during the course of the next year. Mubarak’s absence would have a destabilizing effect on the country’s political system, as questions would arise over his potential successor’s ability to govern as effectively. Mubarak’s probable replacement will be Omar Suleiman, the country’s intelligence chief. The stage will likely be set for Suleiman this year when Mubarak nominates him as vice president. The uncertainty surrounding Mubarak’s fate has developed into a key issue as Cairo is under domestic and, to a lesser extent, international pressure to effect political reforms. The government could conduct a referendum on the constitution and replace the emergency laws that have been in force since 1981 as a means to sustain its hold on power and counter the rise of the Muslim Brotherhood, which is the largest opposition group in the country.

On the Israeli-Palestinian front, Hamas and Fatah will continue to struggle over how to create a power-sharing agreement in the government. As long as Hamas can continue to be bankrolled by the Iranians and the Gulf Arab states, the party can avoid making any serious concessions to Fatah in reshuffling the Cabinet. Palestinian National Authority (PNA) President Mahmoud Abbas will not resort to calling for early elections unless he can be assured that Hamas would be marginalized in the polls — an unlikely prospect for the near future. The stalemate in the Palestinian territories will lead Hamas’ leadership to make gestures with heavy caveats toward recognizing Israel, though Israel will not take the bait. The Israeli government will work to ensure that Hamas and Fatah are prevented from coming together in an agreement; while Israel is sorting out its own issues at home, it will much prefer to have the Palestinians fighting each other than focusing their attention on attacking Israel. The impasse in the territories will prevent the Israelis and the Palestinians from engaging in any serious final-status negotiations this year.

Revise Stratfor or offer your own forecast in the comments.