WASHINGTON -- Defense Secretary Robert Gates says the disclosure of Iran's secret uranium-enriching facility could force more economic penalties against a country reeling from serious social and political divisions.

He played down the effectiveness of military strikes against the site, arguing that pressuring Tehran economically and diplomatically would have a better chance of changing the Tehran government's policies.

"The reality is, there is no military option that does anything more than buy time," he told CNN's "State of the Union" in an interview broadcast Sunday.

"The Iranians are in a very bad spot now because of this deception, in terms of all of the great powers. And there obviously is the opportunity for severe additional sanctions."

Gates' comments come ahead of a meeting Thursday in Geneva involving diplomats from Iran, the U.S., Britain, France, Russia, China and Germany. Tehran's nuclear program is at the top of the agenda.

On Sunday, Iran said it successfully test-fired short-range missiles during military drills by the elite Revolutionary Guard.

Gates emphasized China's key role in winning additional penalties against Iran. The five permanent members of the U.N. Security Council, including China, would have to agree to new sanctions. The United States, Britain and France support additional economic conditions and Russia now appears favorable. But China relies heavily on Iranian oil imports and remains reluctant to give its assent.

"China's participation is clearly important," Gates said.

Gates said further penalties could cause Iran to change its nuclear policies because it already faces serious economic problems. He described the political turmoil under Iran's President Mahmoud Ahmadinejad as "simmering," and noted that unemployment among young people in the country is about 40 percent.

"It's clear in the aftermath of the election that there are some fairly deep fissures in Iranian society and politics and -- and probably even in the leadership," he said. "And, frankly, this is one of the reasons why I think additional and especially severe economic sanctions could have some real impact because we know that the sanctions that have already been placed on the country have had an impact."

The Pentagon chief added, "We are seeing some changes or some divisions in the Iranian leadership and in society that we really haven't seen in the 30 years since the revolution."

It is critical that world powers persuade the Iranians that their pursuit of nuclear weapons will undermine their country's security, Gates said.

This week's meeting is the first step to see if Tehran can change policy to the satisfaction of the world's powers. If that fails, Gates said, then "you begin to move in the direction of severe sanctions. ... I think that severe sanctions would have the potential" of changing their policies.