Iran Doesn't 'Give A Damn' On Nukes

President Ahmadinejad Defiant In Face Of Possible U.N. Sanctions

(CBS/AP)  The International Atomic Energy Agency made it official Friday: Iran continues to defy the U.N. Security Council over its suspect nuclear program. But even such an unequivocal finding does not mean the council will reach consensus about what to do.

A senior IAEA official tells CBS News that Iran's cooperation with inspectors was "lukewarm" and "tepid at best." The report details the stonewalling; for instance, Iran refused to account for all its plutonium, reports CBS News White House correspondent Jim Axelrod.

Iranian President Mahmoud Ahmadinejad was defiant, saying that whatever resolution the Security Council adopts, it cannot make Iran give up its nuclear program. "The Iranian nation won't give a damn about such useless resolutions," he told a cheering crowd in northwestern Iran.

The regime sounds confident, but in the streets and bazaars, there is anxiety, reports CBS News correspondent Elizabeth Palmer from Tehran. Iran's economy has been suffering since president Ahmadinejad took power and sanctions will make it worse.

At Teheran's version of a commodities exchange traders are buying up gold as a hedge against an economic crash while the middle class is stockpiling gold coins. And though Iran ranks number two in OPEC, investment in the crucial oil sector is drying up — incredibly, the government is planning to ration gasoline, Palmer adds.

Despite its clarity, the IAEA report did little to resolve fundamental differences between Russia and China and the council's three other permanent members, the United States, Britain and France, on how to proceed when they take up the matter next week.

China and Russia oppose sanctions and military action and want the Iran nuclear issue resolved diplomatically, with the IAEA taking the lead, not the Security Council.

Iran's enrichment program has come under intense scrutiny because enriched uranium can be used to fuel civilian power plants, which Tehran says it wants, or to produce nuclear weapons, which is what Western nations suspect the Islamic country wants.

It took weeks of painstaking negotiations to craft the March 29 council statement giving Iran 30 days to stop enriching uranium, and the result was much weaker than the West wanted.

With the possibility of sanctions or military action on the horizon, the upcoming negotiations are certain to be even more divisive.

At least for the moment, the five permanent members all agree on one key point: The best way to resolve the nuclear standoff with Iran is through diplomacy.

But the initial reactions to the report by IAEA Director General Mohamed ElBaradei, which also accused Iran of blocking U.N. attempts to find out whether it wants nuclear arms, showed how far apart the key players are.

Iran's U.N. ambassador, Javan Zarif, was conciliatory Saturday, saying "there are a multitude of possibilities for reaching a solution" if all parties agree that while Iran should not develop atomic weapons, it has the right to nuclear power.

"I believe if you start from these two assumptions and not draw arbitrary red lines then we will be able to reach a mutually acceptable negotiated solution," Zarif told the British Broadcasting Corp.