I do not think that this discussion is solely about a nuclear Iran. By obtaining a nuclear weapon, Iran fractures the current power structure of the Middle East. If you assume that Saudi Arabia and Turkey are rational actors (which, if we consider Iran a rational actor - and we do - then these two certainly are), they will inevitably adjust and try to tilt the axis of power back in their direction. If Iran gets a nuke, then Saudi arabia would absolutely want their own nuclear program considering they are fighting at least one and possibly two proxy wars against Iran right now in Bahrain and Syria. If both Saudi Arabia and Iran have nuclear weapons, Turkey would certainly desire one simply to keep up with the Joneses.
It is common knowledge that Iran funds terrorism in the region. Organizations like Hezbollah and Hamas exist purely to attack Israel in Iran's eyes. But why? What benefit does Iran get from destabilizing the region? Well for one, if bombs are going off in the Middle East, I can guarantee you that the price of oil will be high which means more money for the regime. Secondly, they view themselves as the last vestiges of the Persian Empire and they believe they are fighting for a higher cause than just regional power. Iran's aggressive actions benefit their wallets and embolden their cultural values; I highly doubt that they would become less aggressive in the region if they obtained a nuclear weapon. A Middle East full of sectarian tensions and nuclear weapons being agitated by an Iranian power grab is a scary situation.
The region would now be cluttered with seven nuclear states: Turkey, Israel, Saudi Arabia, Pakistan, India, and China.
Do we really want to allow a situation to occur where our biggest trade partner is at the end of a murderers row of nuclear states with three and a half of them run by crazy people? (I don't trust Iran, Saudi Arabia, and Pakistan and Netanyahu seems to have an itchy trigger finger). Sectarian conflicts have defined that region for all of time. This, combined with the fact that most of the world's energy comes from this region leaves our economy vulnerable to a pretty big blow if a nuclear weapon were to ever go off.
Hopefully the Arab Awakening will open a new, more democratic and less conflict-ridden era of Middle Eastern geopolitics but it is imprudent to prepare for the best and hope that the worst does not happen. In my mind, the implications of a nuclear Iran are too great and the stakes are far too high to allow that situation to materialize. Even though the best solution to this nuclear issue with Iran is to incentivize them to come back to the bargaining table like we did with Libya and South Africa, we should consider everything short of a ground invasion to stop Iran from getting a nuclear weapon. If we feel that there is a time table for effective aggression, then we should not hesitate to strike Iran if we feel it is the best option (or the least bad option, which is a better description of the current situation). Perhaps it will take a demonstration of force for Iran to understand that a nuke is more trouble than it is worth.

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