As the Bush Administration took office in January 2001, Iran presented a classic nuclear proliferationchallenge that appeared to be manageable with traditional nonproliferation tools. Today, however, the USbelieves the challenge is far more serious than previously thought, and that the tools for addressing it areno longer sufficient. At the upcoming June meeting of the UN's International Atomic Energy Agency (IAEA),Washington wants the agency to declare Iran in material breach of its non-proliferation obligations. The Bushadministration fears that the development of an Iranian bomb - a project which now appears to have beenbolstered by clandestine foreign assistance - could have far-reaching consequences.