For years, Miad Maleki led the US Treasury Department’s sanctions campaigns against Iran and its proxies, Hezbollah, Hamas, Shiite militias in Iraq, and the Houthis. Maleki, a former senior official at OFAC (the US Treasury’s sanctions enforcement arm), now a senior fellow at the Foundation for Defense of Democracies (FDD, a Washington think tank), knows the methods the “axis of evil” uses to dodge the economic isolation imposed on it. Or, in Prime Minister Benjamin Netanyahu’s words, a “bypass economy.”

Israel has already experienced economic isolation campaigns, from the Arab boycott to the arms embargo French President Charles de Gaulle imposed in 1967, though the most significant ones came during the Cold War. In recent…