Craig McMurtrie reported this story on Monday, October 17, 2011 12:26:00

ELEANOR HALL: The chairwoman of the US Senate Intelligence Committee is warning today that Iran and the United States are on a "collision course".



Senator Dianne Feinstein says she was sceptical about the Obama administration's claims that the Iranian government was behind a plot to assassinate a Saudi diplomat on US soil.



But she says she's now seen evidence to change her mind and she is calling for tougher action against Iran.



From Washington, Craig McMurtrie reports.



CRAIG MCMURTRIE: She's the chairwoman of the powerful US Senate Intelligence Committee.



DIANNE FEINSTEIN: The case is dead bang, I think.



CRAIG MCMURTRIE: And Dianne Feinstein says she took some convincing that the plot to assassinate Saudi Arabia's ambassador to the US was real.



DIANNE FEINSTEIN: I think some of the signals intelligence candidly, is the most compelling and secondly, Arbabsiar himself …



QUESTIONER: This is the Iranian used car salesman?



DIANNE FEINSTEIN: That's right. In answers to his questions, essentially fessed up, essentially admitted it was real.



CRAIG MCMURTRIE: A former Texas car salesman, Iranian-American Manssor Arbabsiar has been accused of approaching someone he thought was working for a Mexican drug cartel to arrange the killing of the Saudi diplomat.



Senator Dianne Feinstein says the evidence points to the commander of the elite Iranian Quds Force knew of the plot.



DIANNE FEINSTEIN: He is known as a very careful manager, he is reported to be very close to the supreme leader. There is no evidence that it reached the supreme leader. This is an unusual thing. Iran reaches out around Iran but to cross to the other side of the world and try an attack in this country is an escalation and that's what concerns us.



CRAIG MCMURTRIE: Iran's supreme leader Ayatollah Khamenei says US allegations of a plot are absurd, while the president Mahmoud Ahmadinejad has hit out at what he calls US propaganda saying, "They accuse the Iranian nation of terrorism. Terror and terrorism are the acts of nations who do not have any culture."



The Iranian authorities have also warned against any US led reprisals but Dianne Feinstein is calling for much tougher sanctions targeting Iran's central bank.



Republican 2012 contender Newt Gingrich wants the Obama administration to go even further.



NEWT GINGRICH: I think our goal should be the replacement of the Iranian dictatorship with a maximum amount of effort to arouse students, to arouse young people, to arouse ethnic dissent, to finance every possible element of opposition, to build a radio and television free Iran and to apply every possible economic sanction.



CRAIG MCMURTRIE: There's no shortage of advice, with Senator John McCain urging the US president to get tough with China and Russia at the same time, over their refusal to cut economic ties with Tehran.



JOHN MCCAIN: The president should seek severe sanctions against the Iranians. I think we should get tough with the Chinese and the Russians who have clearly blocked meaningful measures.



CRAIG MCMURTRIE: After revealing details of the alleged plot last week, US officials gave briefings to Security Council members at the UN, to try and win more international support for tougher sanctions.



While stopping short of calling for a military response, Senator Feinstein warns that Iran is increasingly hostile.



DIANNE FEINSTEIN: Iran is escalating I believe its nuclear development. Iran is increasingly hostile. They have not ceased Hezbollah or Hamas or, it is a very dangerous situation and my hope is that there can be some kind of discussion that can be convincing for the Iranians to change course.



Absent that, at one time or another, if you project out a number of years, we're on a collision course.



CRAIG MCMURTRIE: For his part Iran's supreme leader says his country will face off any attempt to retaliate with all its might.



This is Craig McMurtrie for The World Today.