On Tuesday night, the United States and Iran were poised on the knife-edge of all-out war. With Iranian missiles striking a joint Iraqi-American base in Iraq, it was easy to envision U.S. retaliation followed by threatened Iranian attacks against Dubai or Haifa, Israel. But the mullahs have not stayed in power for 42 years by getting into direct wars with much larger powers. The canny Iranians carefully calibrated their response by doing just enough to save face but not so much that they would trigger a major war. They even let the Iraqis know in advance the attack was coming. This was a warning shot, not firing “for effect”: The Iranians made clear that the United States is not immune from retaliation, but they did so without causing much damage. Firing a barrage of missiles without killing anyone is, by itself, an impressive targeting feat.

We should not assume this is the end of Iran’s retaliation for the death of Maj. Gen. Qasem Soleimani, the fearsome head of the Quds Force. Most likely this is only stage one. Stage two is likely to be a more deniable and costly terrorist, naval or cyber-attack. Senior U.S. commanders will need greater security after the precedent President Trump has established by killing a top general. The Iranians will also continue their political offensive to force U.S. troops out of Iraq. For now, however, the Iranians are eager to give the United States an off-ramp to deescalate.

Trump was smart to take that opportunity rather than carrying out his threat to retaliate “VERY FAST AND VERY HARD” for any attack on American “assets.” This allows Trump to take a victory lap, beginning with his White House speech on Wednesday morning, in which he announced: “Iran is standing down and that’s a very good thing.” Trump was, by his standards, unusually restrained, even if he couldn’t resist an unbecoming (and dishonest) dig at the Obama administration, but he will not be so bashful about crowing about the outcome in the future . We can expect more Facebook ads bragging about the death of Soleimani.

Trump does have grounds for satisfaction. The conflict has not spiraled out of control, as some had feared. Iran has lost its most famous and powerful general, as well as the commander of an important Shiite militia in Iraq and two dozen other militia fighters. After failing to retaliate for a long series of Iranian attacks in 2019, Trump has established a degree of deterrence with Iran. There is a danger now that hubris will follow: Previously cautious in the use of military power, Trump may feel emboldened by the seeming success of his risky gambit — killing Soleimani — to become more promiscuous in the use of force.

But it’s not time to declare “mission accomplished” yet. Contrary to Trump’s Tuesday night tweet, all is far from well. The United States-Iran confrontation, which began when Trump exited the nuclear deal in 2018 and imposed sanctions on Iran in 2019, is far from over. At best we now have a pause that gives room for diplomacy to function. The question is whether Trump will seize the moment.

So far, Trump’s strategy has been maximum pressure. He has inflicted real economic damage on Iran, but he has hardly forced it to capitulate. Far from it: Iran just renounced the limits imposed by the nuclear deal — roughly 15 years early. (No, the agreement wasn’t about to “expire shortly,” as Trump said on Wednesday.) Trump constantly reiterates that he will never allow Iran to acquire a nuclear weapon, but it’s closer to that goal now than it was when Trump took office.

To reach a deal, Trump will need to moderate his demands. On May 21, 2018, Secretary of State Mike Pompeo laid out 12 demands on Iran that amount, as an administration official told me recently, to “conditional surrender.” The terms include ending Iran’s proliferation of missiles and development of nuclear-capable missiles, ending support for all Iranian proxy forces across the region, demobilizing Shiite militias in Iraq, withdrawing from Syria and ending all threats against Iran’s neighbors.

The current confrontation with the United States makes Iran even less likely to accede to these sweeping demands, because the Iranians view their missiles and militias as essential defenses against U.S., Saudi or Israeli aggression. With Trump acting more bellicose, Iran is even less likely to disarm. It’s unlikely that Trump can marshal enough pressure to force the de facto surrender of a regime that fought Iraq to a standstill in the 1980s in a war that claimed at least 1 million casualties. The Iranian regime has a high pain threshold.

The best Trump can realistically hope for is a strengthened nuclear deal with a longer time line, greater inspection requirements and some limits on long-range missiles. And even achieving that modest outcome would probably require a suspension of some economic sanctions to lure the Iranians back to the negotiating table.

There was, alas, scant sign of a diplomatic opening in Trump’s statement on Wednesday, which included an announcement of further sanctions. The dangerous confrontation with Iran is likely to continue, with the Trump administration no closer to reaching its stated goals. Trump may have scored a tactical victory, but a resolution of this crisis remains as elusive as ever.

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