Secretary of State Condoleezza Rice says that Iran is a major obstacle to the U.S. vision of a Middle East in which nations will "trade more, invest more, talk more and work more constructively to solve problems.”
"The Iranian government is pursuing policies which are detrimental to the long-term interests of its neighbors, of the region, and of the Iranian people themselves. It need not be this way," Rice said in remarks prepared for delivery Wednesday to a panel in the House of Representatives.
The Associated Press obtained a copy of her testimony.
Rice's testimony, before the House Foreign Affairs Committee, comes amid increased frustration by Republicans and Democrats alike that the Bush administration is not doing enough to deter Iran's nuclear activities, which they fear are aimed at developing weapons. Iran says its program is only for power generation and other peaceful purposes.
Last month, the House passed, by a 397-16 vote, legislation aimed at blocking foreign investment in Iran, in particular its lucrative energy sector. The bill, sponsored by Foreign Affairs Committee Chairman Tom Lantos, a Democrat from California, would specifically bar the president from waiving U.S. sanctions.
Rice said the administration shares Congress' goal of making sanctions tougher on Iran, but urged caution.
"We simply want to be certain that our collective efforts do not undermine our multilateral strategy, where we will have a maximum chance of success," she said.
President George W. Bush says a U.S.-linked missile defense system is urgently needed in Europe to protect against a potential Iranian strike. Plans for such a system have strained U.S. relations with Russia, which estimates Iran's capability to be less mature and has close financial ties with Tehran.
On Tuesday, Defense Secretary Robert Gates said the Bush administration has told Moscow it may delay activation of the system until it has proof that Iran poses a missile threat.
"We would consider tying together activation of the sites in Poland and the Czech Republic with definitive proof of the threat - in other words, Iranian missile testing and so on," Gates said.
Rice planned to tell the House committee Wednesday that in addition to nuclear ambitions that undermine stability in the region, Tehran has provided "lethal assistance" to extremist groups in Lebanon, Afghanistan and the Palestinian territories, as well as Iraq.
In particular, she noted, activities in Iraq by the Iranian Revolutionary Guard Corps' Quds force "are inconsistent with the Iranian government's obligations and stated commitment to support the Iraqi government."
Russia has left the list of 33 largest holders of US government bonds, after the country disposed of at least a third of remaining bonds