Clement Therme
Jan 03 2018

Iran comes face-to-face with its own contradictions

Six nights of protests against economic hardship and the perceived unfairness of the Islamic Republic have rocked Iran.

Supreme Leader Ayatollah Ali Khamenei and his allies are facing deep social discontent that represents a tremendous challenge to state security forces and their efforts to restore the Islamist order. In the longer term, they will also have to overcome this popular discontent in order to guarantee the survival of the Islamic revolution of 1979.

These protests have been sparked by both immediate and structural causes.

Amongst the short-term factors, one has to consider the 40 percent increase of the price of eggs, rises in the prices of many other staples, government efforts to cut subsidies to the poorest citizens, and the closure of credit agencies that has dispossessed several groups of Iranian investors.

More broadly, expectations that the 2015 nuclear deal with world powers would deliver significant economic improvements were exaggerated. The international agreement did not lead to an improvement in the daily lives of the majority of the Iranian population.

Slogans against the regional policy of the Islamic Republic also once again show the revolutionary fatigue of a vast portion of the Iranian population, especially in relation to its economic cost.

Indeed, protesters’ slogans have focused blame on the leaders of the Islamic Republic for spending Iran’s oil money on proxies such as Hezbollah, Hamas, the Syrian government and other groups in regional countries.

They would prefer to see the cash spent inside Iran and not being used to serve foreign policy goals such as influencing the destiny of the region.

One other question is also asked of the government: How can President Hassan Rouhani talk ending U.S. non-nuclear related sanctions against the Islamic Republic when he does not have the ability to change the policies that are the reason for these very same sanctions?

Beyond the discontent engineered by the double discourse of the elected institutions of the Islamic Republic, there are structural reasons explaining the rise of social discontent in Iran such as widespread corruption in the system and the mismanagement of the economy, especially the distribution of oil revenues.

The authorities were unable to propose solutions for these shortcomings. Therefore, the religious-political elite now appears from the perspective of the protesters as a privileged cast of insiders (khodi) benefiting from the oil rent, while excluding the outsiders (gheyr-e-khodi) from benefiting from their economic favours.

This is the main explanation behind the sense of injustice of the outsiders towards the Islamic Republic. Rouhani’s policy did not work because there is a contradiction between his neoliberal economic policy and the clientelism of the system. Can an oil-theocracy with parliamentarian and militia dimensions overcome this contradiction?

To manage discontent, the founder of the Islamic Republic, Ayatollah Ruhollah Khomeini created an innovative and original political system that can be categorised as an elective autocracy.

The elective dimension is linked to a limited pluralism inside the system. On the one hand, there are the so-called reformist or moderate factions that intend to focus on the civil rights of the population using popular demands for freedom as a tool to win elections.

Nevertheless, once these factions are elected they pursue a policy based on the Chinese model. This has been the case from former presidents Akbar Hashemi Rafsanjani and Mohammad Khatami, to Rouhani. This strategy failed in Iran not only because the government is unable to produce and maintain a high rhythm of economic growth but also because of the refusal of civil society and now the popular classes to find a modus vivendi with the authoritarian political system.

This democratic aspiration can be traced from the Constitutional Revolution of 1905 to the Green Movement of 2009. Moreover, once in control of the government, the reformist faction has chosen a neoliberal economic path following the guidelines of International Monetary Fund (IMF).

This is in contradiction to the revolutionary promise of giving priority to the oppressed (mostazafin). The revolutionary ideal of Islamic social justice has therefore to be abandoned for the sake of the structural adjustment of the economy.

On the other hand, conservative factions (osulgarayan), offer as an alternative a reckless policy of redistribution of the oil rent to the poorest segment of the population. This time the revolutionary promise is fulfilled, but at the expense of the economy.

The deadlock provoked by both conservative and reformist factions is one of the main reasons explaining the current expression of popular discontent. Because putting a vote in the ballot box is not anymore a solution, the citizen, the victim of the economic inefficiency of the Islamic Republic, transforms into a protester.

In the absence of solutions from inside the Islamic Republic establishment, what can a centrist president like Rouhani do? In the context of social polarisation inside the country, he has no other option than blaming the U.S. administration for the shortcomings of a system that always despises economic questions.

Khomeini once said, “economics is for donkeys”. At the time, the objective was to justify the priority given to spiritual matters.

Today, questions related to political economy are bringing the Islamic Republic face-to-face with its contradictions. These irreconcilable goals can be best seen through the opposition between the character of the mullah businessman and capitalist and the ambition of the Islamic revolution to give priority to the protection of the oppressed.

Today, a large proportion of the protesters belong to the popular class. They have denounced the hoarding of resources by the new religious-political elite. This is already a strong repudiation for a religious government that once thought that Shi’ite Islam should always be at the centre of any legitimate government in Iran.