The demonization of Iran drags on relentlessly as the Iranian Revolutionary Guards Corps (IRGC) has been officially branded a proliferator of weapons of mass destruction and its elite Quds Force a supporter of terrorism. The latter has for months been accused of supplying Shi'ite militias in Iraq with weapons that are killing US soldiers.

The new round of US sanctions also targets Iran's Defense Ministry, as well as three major Iranian banks accused of financing "the usual suspects"; Shi'ite militias in Iraq, Hamas in Palestine, Hezbollah in Lebanon and - absurd as it may sound - the Taliban in Afghanistan. The banks are the state-owned Bank Melli, Bank Mellat and Bank Saderat.

The US State and Treasury departments jointly announced the new sanctions, citing the Islamic Republic's defiance over its continued nuclear program and its alleged involvement with terrorist organizations. The new restrictions are unilateral and aim to prevent businesses and other groups both within and outside the US - but that do work within the US - from dealing with individuals who are part of any of the banks, military forces and other organizations in Iran that were named, including the IRGC.

The move follows President George W Bush's comments last week that implied that Iran obtaining nuclear weapons could lead to "World War III", and Vice President Dick Cheney's speech on Sunday in which he said that "the international community is prepared to impose serious consequences" if Iran does not comply with demands.

Sanctions do bite - as some Iranian conservatives have started to publicly admit. But Tehran won't be in a hurry to mount a hug-and-kiss expedition to Washington. Cuba has been fighting a US blockade and sanctions for almost five decades - and has managed to survive with dignity.

The more than 20 companies and individuals affiliated with the IRGC that are now excluded from the American financial system - and nodes of the international banking system - will still have plenty of opportunities of doing business with Russia, China or Arab monarchies. They may barter. They may exchange goods with services. And they may resort to the black market.

As far as Moscow and Beijing are concerned, they are hardly shivering with fear in the face of renewed State Department "warnings" to China not to invest and Russia not to sell weapons to Iran.

This new round of sanctions is just one side of the demonization of Iran campaign - as US Secretary of State Condoleezza Rice was once again spinning the other side of the same old scratched vinyl, that of preventing "one of the world's worst regimes from acquiring the world's most dangerous weapons". The International Atomic Energy Agency still has not found any evidence Iran is developing a nuclear program for military use, and has called for the further engagement of Iran, rather than its isolation.

Meet the terrorists
The IRGC was founded by a decree of Ayatollah Ruhollah Khomeini, the leader of the Islamic Revolution, in May 1979. In the beginning, in pure revolutionary fashion, it was the "eyes and ears" of the revolution, its trusted popular army fighting the enemy within - which could be, according to revolutionary whim, the deposed Shah's supporters, communist militants, ethnic minorities like the Kurds in the northwest or Arabs in oil-rich Khuzestan province, or Western-educated, influential intellectuals.
The early revolutionaries in 1979 had two fears: a military coup orchestrated by remaining Shah supporters, or an attack by the US. What happened was the Iran-Iraq War (1980-1988), started by Saddam Hussein with the hardly silent support of the US and the West. So the popular army immediately had to be converted into a parallel - and soon very powerful - fighting army.

Almost 1 million IRGC people - pasdaran (soldiers) and bassijis (young militiamen under their control) - died in that horrendous war, and are today revered as martyrs.

The IRGC today numbers, according to their bureau in Tehran, about 130,000. Ground forces have 105,000 soldiers - four divisions, six mechanized divisions and one marine brigade. The air force has 5,000 men and the navy 20,000, with an undisclosed number of vessels equipped with anti-ship missiles. Three separate units man the Shahab-3 missiles, with a 1,500-kilometer range; the new Shahab-4 has a range of 2,000 kilometers.

The Quds Force of the IRGC - the key target of US ire - may have as many as 15,000 men. They are specialists in surveillance and special operations. It is the Quds Force that trained Iraq's Badr Brigades, the paramilitary arm of the Supreme Islamic Iraqi Council, the party of Abdul Aziz al-Hakim allied with the US. The Badr are firmly ensconced at the Iraqi Ministry of Interior - and it is they who have spawned death squads and accelerated ethnic cleansing in Baghdad. Instead of accusing Iran without any evidence, Washington should take a good look at what its Iraqi allies are up to.

The Quds Force has four main bases in Tehran, aside from bases in Mashhad, Qom and Tabriz and a semi-secret base in eastern Lebanon. These bases would in all certainty be hit in the event of an American - or Israeli - strike. It is the IRGC that supplied Hezbollah with the rockets and anti-tank missiles that caused havoc during the Israeli invasion of southern Lebanon in the summer of 2006.

In bed with business
After the Iran-Iraq war, the IRGC quickly diversified from the battlefield into real estate development. The man who actually gave the go-ahead was then-president Hashemi Rafsanjani, the wily, indestructible pragmatist who is today the actual number two of the regime, behind only Supreme Leader Ayatollah Ali Khamenei.

The business-minded IRGC thrived during the 1990s. Today it controls more than 100 large companies involved in telecoms, road and dam construction, luxury hotels, the auto industry (the Mazda assembly line in Iran) and, crucially, oil and gas exploitation at the giant South Pars field.

The IRGC power play is visible in upscale north Tehran in a cluster of high-security buildings occupied by the revolutionary bonyads (foundations). That's also where the IRGC elite enjoys itself in restaurants like the Talaie, with its water fountains and tearoom. The foundations - many directed by IRGC people - don't pay taxes and their budget is under direct supervision of the Supreme Leader. So the IRGC in fact controls an array of both public and private companies, financed by their own network linked to the Iranian Central Bank. They also have extensive connections in the black market - one reason why US sanctions may not bite as much as the Americans believe.

President Mahmud Ahmadinejad is an ex-pasdaran himself - thus also a "terrorist" according to Bush administration logic. The same applies to no fewer than two-thirds of the members of the Majlis (parliament). Most of the leadership at the Ministry of Interior is also ex-pasdaran. Five IRGC generals are already under United Nations sanctions, as they are responsible for Iran's nuclear and missile program.

The bassijis - essentially a gigantic militia - are the IRGC at street level. They number about 100,000, but in theory could instantly draw on as many as 20 million people - hence they are known in Iran as "the army of 20 million". The bete noire of the bassijis include students (especially those attracted by the West) and Western-minded women and girls bent on showing off their stylish hairdos, fancy makeup and curves under their chadors. The bassijis' main bases virtually surround Tehran; they are capable of blockading the whole city in less than half an hour.

We'll bomb you to bits
During the years of reformist president Mohammad Khatami (1997-2005), the Supreme Leader cleverly manipulated the IRGC for political ends, thus preparing for the arrival to power of Ahmadinejad and his IRGC buddies. Dejected reformists in Tehran swear the IRGC now controls everything: power, wealth and weapons.

The IRGC is accused of being involved in all sorts of rackets, from oil smuggling with Iraq to opium trafficking with Afghanistan. Hard evidence is extremely difficult to come by. Investigative reporting in Iran inevitably lands practitioners in jail. What is certain is that the IRGC is flush: US$12 billion in contracts in 2006 alone, including a mega-pipeline and the Tehran metro. A few Iranian ministerial officials, when pressed, admit strictly off the record that the IRGC is in fact a huge industrial-military complex - not exactly like that of the US but rather similar to that of the former Soviet Union - ghostly and as Kafkaesque.

Even well-positioned Iranians cannot clearly distinguish who is manipulating whom in the wide net involving the Supreme Leader, the IRGC, the fervent bassiji masses and business and national security interests. By branding the IRGC as terrorist, Washington has in fact declared war on the Iranian power elite.

One can imagine what would happen if any developing country branded the US industrial-military complex as "terrorists" - and any number of countries would have plenty of reasons to do so. By stretching its "war on terror" logic to actually naming names, the Bush administration has boxed itself into no other option than regime change in Iran.