Inside Iraq, serial numbers on weapons and explosives used by a number of insurgent groups point to the Qods (Jerusalem) Force, the IRGC's foreign arm. Some American intelligence officials believe Qods has financed and armed Shiite militias. The Iraqi Ministry of Defense has accused Qods of supporting insurgent cleric Moktada al-Sadr with $80 million in funding and resources.

IRGC commanders will also continue to bankroll and provide arms specifically for Hezbollah and Hamas terrorist operations. The Corps, for instance, provided radar-guided rockets used by Hezbollah during last summer's war against Israel. Last October, Hamas Interior Minister Said Siyam inked an agreement with the IRGC to transform Hamas' military wing into an adjunct IRGC force. The cost of the training was $60 million--and the IRGC paid the bill.

The regime in Tehran is being squeezed by foreign banks and companies that are increasingly reluctant to shoulder the risk of business with Iran. But while access to foreign financing is shrinking, a growing portion of what remains a large commercial market is going to the hardest of the hardliners.

Omeed Jafari is a research associate in foreign and defense policy studies at the American Enterprise Institute in Washington, D.C.