Stephen Walt still wants to engage Iran:

The Obama administration should stay pretty much on course for now. Many Iranians clearly want a more normal relationship with the outside world -- including the United States -- and Obama's approach makes it harder for the regime to use the American bogeyman to stimulate Iranian nationalism and thereby bolster its position. Moreover, a U.S. attempt to exploit popular discontent  is likely to backfire, because it will reinforce long-standing (and I am sorry to say, amply justified) Iranian suspicions that the United States simply cannot resist interfering in Iran’s domestic politics. 

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