As anyone will know who has followed the way the Iranian regime operates, it has a record of games-playing when it is put under pressure. And all too often it overplays its hand.

It happened last month when Iran threatened to close the Strait of Hormuz if the US and EU went ahead with sanctions. The threat was quickly retracted but it nonetheless played into the hands of those wanting to up the military stakes in confronting them. Now Iran is in danger of doing it again with the over-orchestrated announcement of its newfound mastery of the uranium enrichment process.

The technical leap was in the event nothing very much to write home about, never mind to announce on television. Yet the really interesting thing about it was that, at the same time, the Iranians are making some quite definite steps towards peace. They have apparently cancelled naval manoeuvres in the Strait of Hormuz originally scheduled for this weekend, and they have also – despite the lack of public attention drawn to it – responded positively to the EU offer of renewed talks on their nuclear programme.

The time, argues Dennis Ross, the old Middle East hand who still advises the US government, in an article which has aroused considerable interest in Washington, may now be ripe for diplomacy to come into play. A deal, allowing Iran to continue with uranium enrichment under strict controls, might work.

There are plenty of reasons for poo-pooing the idea. Dennis Ross, a man known for his support of Israel and his closeness to the neocon Republicans, bases his argument on the proposition that sanctions are now so effective that Iran is being driven to the negotiating table.

You could well argue the opposite. Sanctions are certainly hurting, but they are affecting ordinary people far more than the ruling elite. Just as in Iraq under Saddam Hussein, the government uses sanctions to garner support against a foreign imposition and to increase its own control of the means of trade.

Given the Iranians' notorious national pride, it is also a mistake to assume that they will ever give in to what is clearly outside pressure. A willingness to negotiate could be taken – and has been in Washington – just as a ruse to ease the pressure.

Either way, the moment could hardly be taken as an encouraging time for the trust and mutual self-interest that are the basis for negotiated agreement. Then again, maybe it doesn't matter, or at least oughtn't to.

There has been too much analysis of motivation and outcomes. All it has done is increase the mutual incomprehension of the two sides. You don't need sophisticated interpretations. The simple fact is that the West has driven itself down a cul-de-sac of increasing sanctions and rising military threats met by ever-more-urgent action on the part of Iran to develop nuclear technology and to show themselves uncowed.

We need a way out. However low the expectations, renewed talks could provide the means of achieving it. The basis of an agreement is there. It lies in giving Iran the right to continue enrichment in return for allowing tighter inspections to ensure that its nuclear development is for peaceful purposes. Iran certainly shows a desire to master the technology, but so far it has not thrown out the IAEA inspectors.

Why doesn't everyone just grow up and forget all the demonisation of each other's motives, and start negotiations in good faith? Who knows? It might just lead to something – a little mutual understanding for a start.

Let the Greeks decide

There is something peculiarly hypocritical in President Sarkozy's electoral promise that he will restore power to the French people through holding referendums while all the while demanding of the Greeks that they sign away all control of their lives without a vote. What is sauce for the goose in this case is not even on offer for the gander.

It ought to be. We can never have a European Union which works unless the same principles of democracy apply to the whole as they do to the individual components. For more than half a century, politicians have talked about the "democratic deficit" in Europe. And absolutely nothing has ever been done. Now, 25 of the 27 members seem ready to sign up to tighter controls, using commission institutions to supervise the most basic power of sovereign government (that of taxing its people). The presence of the European Parliament hardly enters the conversation let alone the vote of the people concerned.

The EU will attempt to muddle through with a decision over Greek debt on Monday, as it usually does. But it will be attempted without mutual trust and with the worst of consequences on the political health of the union.

Sarkozy may have the answer. Let the Greeks decide in a referendum whether they will accept the austerity demanded or whether they would prefer to leave the euro. Then what happens next would have the authority which only democracy brings.

a.hamilton@independent.co.uk