Donald Trump’s war against Iran began with one gamble and ended with another. Initially, the president bet that he could stop Iran’s nuclear ambitions by bombing Iran’s revolutionary regime out of existence. So he spent tens of billions of dollars, and upended the global economy, only to sign a memorandum of understanding undoubtedly weaker than any deal he could have struck before the war. Embedded in this document is a new gamble: that if Iran’s revolutionaries can’t be dislodged by force, they might instead be bribed to abandon their identity.The memorandum offers a bundle of American inducements so lopsided that it reads as if Tehran wrote the plan unilaterally. Of its 14 provisions, 13 either amount to diplomatic boilerplate or heavily favor Iran on their face. Tehran will receive military and economic concessions—and de facto acknowledgment of its control over the Strait of Hormuz—in exchange for a concession that it will not develop or buy nuclear weapons. Never mind that Iran has made and ignored such promises before, and the CIA doubts its sincerity now.[Graeme Wood: Iran has humiliated Trump]The humiliation of the memorandum is doubly egregious for Trump, who withdrew from Barack Obama’s multinational agreement to limit Iran’s nuclear programs. Trump called that agreement the “worst deal ever negotiated,” but it was less costly to America, was less generous to Iran, and offered more concrete nonproliferation guarantees. Trump is paying far more for far less.He has acted like a poker player who believes his own bluffs. Trump vowed to raze Iran’s missile industry to the ground; defang its proxy militias, such as Hezbollah; unseat its regime; choose its next leader; and control the Strait of Hormuz. While none of his maximalist war goals were achieved, Trump celebrated the cease-fire, and lifting of the blockade, as if he had had no role in creating the whole mess in the first place.The Islamic Republic, one of the world's most brutal, isolated, and unpopular regimes, has emerged with its economy and military further decimated but its confidence restored. On the eve of the war, it was a bankrupt global pariah that had just massacred thousands of its own people—perhaps tens of thousands—to crush a national uprising. Today it celebrates having defied America and Israel, and basks in Western commentary that it is a rising power.Virtually every American president since the 1979 Iranian Revolution has wanted to improve relations between Washington and Tehran. Doing so would be in the national interest of both America and Iran, but no administration has achieved this outcome. Iran’s revolutionary theocracy thrives in isolation and has made resistance against the United States and its ally Israel central to the regime’s identity, its internal legitimacy, and the cohesion of its security forces.Having assassinated the regime’s top leadership, Trump is now trying not only to negotiate a new nuclear deal but to engineer a grand bargain that transforms U.S.-Iran relations. But he is hedging his own bet by putting J. D. Vance in charge of the effort. Vance recently told The New York Times that Tehran’s new elite are rethinking the revolution and coalescing around a new consensus that “47 years of Iran policy towards the United States has been a mistake.” Trump, however, has made no secret of his calculations. “If it works out, I’m going to take the credit,” he said earlier this week. “If it doesn’t work out, I’m blaming J.D.”[Jonathan Chait: All the sad hawks]Vance’s political future may rest as much on Islamic Revolutionary Guard Corps officers as on Republican-primary voters. One of Vance’s hopes to lead Iran’s ideological transformation is Mohammad Baqer Qalibaf, a former IRGC general and the current speaker of Iran’s Parliament. The two men spent more than 20 hours together in Islamabad earlier this year and reportedly built a private rapport. Yet Qalibaf’s recent public speeches and interviews—mocking America, praising Hezbollah, threatening Israel, and hailing partnership with China—will likely prove to be a truer barometer of Tehran’s intentions than any private assurances of goodwill.There are other major obstacles to normalization. The memorandum suggests that Iran could get $300 billion in investment, ostensibly from the same Gulf countries that were just on the receiving end of thousands of Iranian missiles. “It’s presumptuous for the U.S. to commit other people’s money,” Ali Shihabi, an adviser to Saudi leadership, told me. “Gulf countries should not be paying reparations for a war they did not want.” A Gulf diplomat was much blunter. “They’re not going to get a penny from us,” he told me.The logic of Trump’s current gamble with Iran resembles his entreaties to the North Korean dictator Kim Jong Un during Trump’s first term: The president is offering reintegration as a reward for denuclearization. In Singapore, Trump famously tried to entice Kim with visions of turning North Korea’s missile-testing coastlines into prime real estate, marveling at the country’s “great beaches” and envisioning “the best hotels in the world.” But for revolutionary dictatorships such as North Korea and Iran, Western-backed luxury hotels, foreign tourists, and open capital flows aren't a triumph—they are a Trojan horse that would erode their total information control and ideological legitimacy.The memorandum calls for 60 days of negotiations, but virtually no one expects a nuclear agreement—let alone the end of a 47-year U.S.-Iran cold war—to come about so quickly. So the war may not be over; it might merely be paused. Tehran will try to rebuild its missiles and proxies, which won’t be part of any agreement. According to reports, it still retains as much as 70 percent of its prewar missile stockpile and its mobile launchers. It still produces large quantities of missiles and drones.Tehran’s new leadership is not moderating the regime’s internal conduct. Parastoo Ahmadi, a 29-year-old singer, was recently sentenced to 74 lashes for performing a concert publicly without a hijab. Security forces have stepped up persecution of the Baha’i religious minority. And dozens of political prisoners have been fast-tracked to the gallows. In other words, there are no visible signs on the ground to bolster Trump's argument that the regime has become “very rational” and is “not radicalized.”[Read: The U.S. had no choice but diplomacy—yet again]Aside from the Iranian people, the Gulf countries that sought to befriend Trump have been the biggest losers. Their previously vibrant economies were sabotaged by Iran’s $20,000 drones. Given the existential threat they feel from Tehran, they will have no choice but to rely more than ever on America’s security umbrella—while also being forced, at the same time, to cut their own side deals with Iran.Trump has recently metamorphosed from an Iran hawk into an Iran apologist, defending the Islamic Republic’s missile program and lauding Mojtaba Khamenei—an ideological carbon copy of the hard-line father whom Trump assassinated—as respected and pragmatic. The president’s incoherence has become a source of gallows humor among Iranians. “Trump went to delete Ayatollah Khamenei,” one Iranian told me, “but he accidentally pressed ‘Update.’”Perhaps the peace deal is just a tactical retreat. “If he doesn’t like where this is going, he will go back to the blockade or bombing them,” a senior administration official told me. “And oil prices will be much lower.” Yet Trump, who has clearly wearied of the economic disruptions that his war has caused, may not want to gamble on renewed hostilities with Iran.U.S. presidents typically begin to understand the nature of the Islamic Republic only at the end of their term. Ever since the 1979 revolution and the subsequent hostage crisis ruined Jimmy Carter’s reelection campaign, Tehran has prided itself on sabotaging American chief executives. This time it may get a two-for-one: the presidency of Donald Trump, and the presidential ambitions of J. D. Vance.