Rouhani’s Path to Becoming Supreme Leader

On Tuesday, President Hassan Rouhani appeared in front of Iran’s parliament to defend his government’s economic record. He faced a tough crowd. The body had already removed his economy minister, Masoud Karbasian, on Sunday. And before that, it had canned his labor minister, Ali Rabiei. Both were ousted on charges amounting to incompetence.

Rouhani’s appearance before the parliament was an opportunity to hit back—to denounce his rivals, some of whom had taken to issuing death threats against him. And yet, in the moment, he was hardly combative. Rather, he blandly called for unity against “those anti-Iranian figures who now sit in the White House.”

No doubt, Washington’s policies under President Donald Trump are a major factor in a sudden economic plunge that has seen Iran’s currency, the rial, lose half of its value since April. But they aren’t the only problem; Rouhani even admitted as much in his remarks. A healthy economy, he said, requires “foreign investment and domestic political stability.” Those are both in short supply these days; the same rivals Rouhani urged to unite with him against the United States have systematically undermined confidence in the Iranian market and created domestic political mayhem since well before Trump’s inauguration.

Rouhani, however, chose not to open that particular can of worms. He has apparently accepted the role of scapegoat, which he must think is the most politically prudent course to maintain his presidency and his power, including a shot at eventually becoming Iran’s supreme leader. But he is wrong, and he will very likely pay a high price for choosing not to go on the offensive.

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The impeachment of Karbasian, a low-profile technocrat with little political clout who was in his job for only one year, is illustrative. He never had the ability to introduce any of the serious economic reforms Iran needed—and that was hardly a secret. As one of the parliamentarians who backed the economy minister’s impeachment put it during the debate, Karbasian was just low-hanging fruit. “If we could, we should have impeached Rouhani,” Elias Hazrati said from the podium in the Majlis. In reality, the body would have needed to go after much more than the president if it really wanted economic change.

The Iranian economy’s three most glaring failings are a militant foreign policy that undercuts domestic and international confidence at every turn, rampant corruption, and massive nepotism that stems from Supreme Leader Ayatollah Ali Khamenei’s habit of doling out economic favors to his hard-line supporters. On all three levels, it is not Rouhani but Khamenei who has control.

For example, few in Tehran deny in private that Iran’s militant foreign policy is responsible for the country’s economic woes. Asked last weekend on national television why Iran seems to have so many troubles in its relations with the outside world, Foreign Minister Mohammad Javad Zarif was quick to respond: “Because this is the way we have chosen to live.” Iran, he implied, is paying the price for having an independent foreign policy and for standing up to the United States.

Such claims might have rung true 40 years ago when the Islamic Republic first set out on its own path. They do not today. In the same television appearance, Zarif struggled to explain why his highly independent nation keeps giving into Russian demands—in one recent controversial case by softening its position on the demarcation of territorial waters in the Caspian Sea—or why Iran has given Chinese commercial vessels the right to fish in Iranian waters.

Even ordinary Iranians increasingly see their country’s foreign policy less as self-driven and more as reflexively anti-American. That bent is, in turn, pushing Tehran toward becoming a client of Beijing and Moscow, which have their own agendas and are happy to exploit the Iranian-American standoff at great expense to the Iranian people.

Rouhani is not, of course, innocent in all of this. He sold himself as the man who could save the country from economic disaster and return it to international respectability. Instead, Iran is worse off than ever. The reformists and moderates who voted for him have come to see him as an opportunist with no genuine desire to bring about serious political change. (After all, the country is as much of a police state today as when he first came to power in 2013.) And the hard-liners have accused him as being obsessed with the West and therefore untrustworthy.

This means that Rouhani’s hands are tied when it comes to foreign policy. When in recent weeks figures close to the Iranian president hinted at a potential meeting between him and Trump on the sidelines of the U.N. General Assembly in September, the hard-liners waged a public dissuasion campaign. And in a speech on Aug. 13, Khamenei explicitly warned against such a summit. “If there are to be any more negotiations with the Americans, they will not be with this man [Trump].” At the same time, the supreme leader blamed Rouhani for having acted naively during the nuclear negotiations in 2015 and accused him of crossing certain unnamed “red lines.” Never mind that Khamenei himself launched secret nuclear talks with the Americans in Oman before Rouhani came to office.

More bitingly, Khamenei has begun to openly blame Rouhani for the economic mismanagement and corruption that plague the country. (Transparency International ranks Iran as one of the most corrupt nations in the world, behind such notable competition as Pakistan, Egypt, and Brazil.) In Khamenei’s telling, sanctions do hurt, but Iran’s problems have much more to do with bad internal policies. Yet the supreme leader has never acknowledged that he, as the regime’s ultimate steward for the last 29 years, is the one in charge of those policies.

There is no doubt that Rouhani has given plenty of fodder to his rivals when it comes to corruption, too. For example, his younger brother and the brother of his first vice president were both embroiled in recent scandals. Another time, he came in for criticism over generous salaries received by officials working for the state in a scandal that became known as payslip-gate. But the elected president is not at the heart of Iran’s graft problem; that honor goes to the unelected supreme leader. Khamenei oversees a vast network of economic interests, including, according to Mark Dubowitz and Saeed Ghasseminejad writing for the Wall Street Journal, the Execution of Imam Khomeini’s Order, the Mostazafan Foundation, and the Astan Quds Razavi, which together are worth about $200 billion and touch almost every corner of the Iranian economy.

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Rouhani and his team may not be to blame for Iran’s woes, but he seems almost happy to let his expendable ministers take the heat. That makes some sense: From his perspective, the most important thing is to come through the presidency in one piece and keep himself in the running for the ultimate job, the supreme leadership, which will be up for grabs the day the 79-year-old Khamenei dies. Given Rouhani’s prominence in politics since 1979, he has long been a potential candidate for the post, and it is safe to assume that he saw the presidency as a valuable platform for cementing his position in the race (especially if Khamenei died while he was in office). Rouhani can still hope to remain in the running even if Khamenei dies after his presidency ends, which is why he has been reluctant to push back against his critics.

Rouhani’s strategy might have once had merit, but the state of Iran’s economy has gotten too poor for it to make much sense now. More and more, the Iranian economy looks ready to fold. Beyond the collapse of the rial, the price of some food items has risen by 50 percent, and water and power shortages have become routine. Official Iranian data, meanwhile, show a 72 percent drop in the incomes of ordinary workers since the Persian New Year, which began in March. Not surprisingly, over the course of the last year, public protests have become routine, and a daily campaign on social media to identify instances of nepotism among regime loyalists has already pushed some officials out of office.

This level of outrage is rare and seems likely to boil over. Already, calls to oust specific figures, such as Rouhani, have morphed into rage against the entirety of the regime. It is not likely that Khamenei will, in fact, throw the president out; it is far better to keep him weak and in office, where all the anger and blame in the world can be directed to his door. It is also unlikely that the public will dismantle the entire regime. Still, it has already pushed Tehran into responding to its demands in some way. In fact, the latest frenzy of impeachments and dismissals was nothing if not an attempt to show that the regime is not deaf to public opinion.

Rouhani does not have to accept being the chief scapegoat forever. It is true that doing so has helped him avoid a feud with Khamenei, whose hard-line supporters Rouhani most likely needs in the event that he puts himself up for the top job. But at a certain point, shouldering the blame will cause such damage to his reputation that it will cost him the support of the reformers in government, who will also play a role in the selection of the next supreme leader, and of the public, which has shown somewhat more interest than usual in fundamentally reforming Iran’s system of government.

Rouhani has one card left to play, and that is to return to the reformist promises he made in 2013 and in his 2017 re-election. He has to hit back hard and in a credible fashion. He could point out, for example, that the Foreign Ministry does not decide Iran’s controversial foreign policies in the Middle East. That is the doing of the Islamic Revolutionary Guard Corps generals backed by Khamenei. He could also point out that his defense minister does not choose the place and timing of controversial ballistic missile tests or that the Intelligence Ministry is not behind the arrest of dual nationals—both activities that have won Trump’s ire. It might be too little too late to salvage his reputation in Iran, but Rouhani’s alternative—to appease the hard-liners, including Khamenei himself—wasn’t going to work after the economy started tanking. The supreme leader and his loyalists needed someone who was not themselves to blame, and Rouhani fit the bill.

At the heart of Rouhani’s political message in 2013 and 2017 was the promise of fundamental political and economic reform, including negotiations with foreign adversaries such as the United States. If he cannot pull it off because Khamenei won’t allow it, then Rouhani should put his case to the people. More cabinet reshuffles or looking away as his helpless ministers are dragged in front of the parliament won’t help anyone.