The impact of U.S. sanctions against Iran and other state sponsors of terrorism have been undermined by loopholes that allow exemptions for humanitarian, agricultural and medical exports, according to a report in The New York Times. Most of the loopholes were created by a 2000 law that created exemptions for agricultural and medical exports for humanitarian purposes and resulted in $1.7 billion of U.S. exports to Iran in the last ten years. Although these exports have not directly aided Iran’s military buildup, some of the exemptions have benefited Iranian companies owned by Iran’s Islamic Revolutionary Guards Corps or other entities linked to Iran’s repressive regime. In some cases the licensing rules failed to keep up with changing circumstances, such as when imports from North Korea were allowed when restrictions that were loosened with North Korea promised to renounce its nuclear weapons program and were not re-imposed after Pyongyang violated its pledge.

An Obama Administration spokesman defended the policy, saying that the majority of the cases were approved under a law requiring the Treasury to license exports of agricultural and medical humanitarian aid to Iran and Sudan. “These are not discretionary exceptions to U.S. sanctions made by Treasury,” the official said, speaking on condition of anonymity, but “Because the U.S. has the toughest and most comprehensive sanctions against Iran, allowing for the exportation of food, medicine and medical devices is consistent with our objective of not hurting the Iranian people.”

While the objective of “not hurting the Iranian people” may be a valid goal to the extent that it does not help the Iranian regime, the Obama Administration should take a closer look at the exemptions to make sure that the exports do not benefit Iranian importers owned or affiliated with Iran’s tyrannical regime. And Congress should review the law, which was passed before the 9/11 terrorist attacks, when counterterrorism efforts received a lower priority.

In recent months, Iran has been forced to pay a rising economic price for its nuclear defiance by four rounds of sanctions imposed by the United Nations Security Council. But Iranian President Mahmoud Ahmadinejad remains confident that Iran can outlast sanctions. At a news conference in Istanbul Thursday, he said, “Sanctions have no impact on Iran’s decision-making process … and sanctions have always failed. … Our enemies cannot harm our very strong economy by imposing sanctions on Iran.”

The Obama Administration and U.S. Congress should make every effort in the coming year to prove Ahmadinejad wrong. A good place to start would be closing existing loopholes in sanctions laws that unfortunately benefit Ahmadinejad’s brutal regime.