KEY POINTS:
The Iranians have clearly concluded that all the American and Israeli threats to attack them are mere bluff. Israel could not destroy all of Iran's nuclear facilities unless it was willing to drop several nuclear weapons on Iran.
The United States could do the job using only conventional weapons, but in reply Iran could close the Gulf to tanker traffic and cause a global economic crisis. So the US and Israel must be bluffing, unless they are crazy.
This explains the bravado of Iran's little propaganda show on July 9, when it test-launched several ballistic missiles, including one that has the ability to carry a nuclear weapon and the range to strike Israel.
This elicited veiled threats of an attack on Iran from Washington and Jerusalem, but the Iranians don't believe them any more.
The Shahab-3 missile that the Iranians tested has flown before, and it could indeed reach Israel. But it lacks a proper guidance system, and probably could not penetrate Israel's anti-ballistic missile defences. More importantly, as the US National Intelligence Estimate of last December affirmed, Iran has no nuclear weapons, and closed down its programme to develop a nuclear weapons capability in 2003.
The main purpose of the tests was to strengthen the hard-liners in domestic Iranian politics. The Iranian Revolutionary Guards, the organisation that carried them out, wants to keep the confrontation with the United States and its allies alive because it fears that other elements in the regime might bargain away Iran's right to enrich nuclear fuel for civilian use.
If neither the United States nor Israel intends to attack Iran, this is a cost-free strategy - you win the domestic political struggle and nothing bad happens to you internationally. If you miscalculate, however, you get a war out of it.
What are the odds that the Iranians are miscalculating?
Many institutions try to analyse this question. But all of them are essentially guessing what goes on in the minds of the US President and/or the Israeli Prime Minister - two men in a hurry.
President George W. Bush leaves office in January, and Ehud Olmert may be gone by September as the result of a corruption scandal.
Bush seems to have convinced himself that something must be done about the "Iranian threat" before he goes. But he faces the almost unanimous opposition of the US military and intelligence establishment, who are horrified by the prospect of an unwinnable war against Iran.
Last December's National Intelligence Estimate was a deliberate attempt to undercut the Bush Administration's relentless propaganda about the "Iranian nuclear threat".
Olmert's coalition government in Israel might collapse if he chose to attack Iran alone. Besides, Israel could not do such a thing without Washington's approval so it all comes back to what Bush decides. He probably doesn't know himself yet.
In circumstances like these, I generally consult the International Institute for Discussing Current Affairs Over Dinner.
Membership is limited to myself, my wife and my many talented children. Like me, they are experts in everything, and one of our most effective analytical tools is an exercise called Setting the Odds.
A quorum of the institute's membership is currently on holiday in southern Morocco, and we deployed this technique at dinner last night. I offered my colleagues two-to-one odds that neither the United States nor Israel would attack Iran this year, and they laughed in my face.
Their response was the same at odds of four-to-one. At six-to-one one showed mild interest, but still declined the offer. From which I deduce that an actual attack on Iran this year is extremely unlikely.
The Revolutionary Guards are right. You may object that this technique lacks scientific rigour. But we have a good track record, because we assume that while individual leaders may lose the plot, large institutions like governments and armed forces are generally more rational in their choices.
There are occasions when whole countries are so traumatised by some shock that truly bizarre decisions become possible - the United States after 9/11 was like that for a while - but this is not one of those times. Six-to-one says that there will be no US or Israeli attack on Iran this year.
