by Shireen T. Hunter

Since last year, Iran’s economy has seriously deteriorated as speculators have rushed to exchange national currency for dollars while others, fearing more troubles to come, have been moving their capital out of the country. Close to $30 billion has reportedly left the country since the currency crisis began.

The mounting economic problems have also caused social and political instability. The first manifestation was in January 2018, when large-scale protests occurred in Tehran and other major cities. Last month, protests broke out in the south-western province of Khuzestan over shortages in drinking water. Iran’s south-eastern province of Sistan and Baluchistan is also facing serious water shortages, and the available water, mostly delivered by tankers, is of poor quality. A very hot summer, especially in the country’s south, has caused shortages of electricity resulting in blackouts. Even the capital, Tehran, has not escaped power cuts.

Electricity shortages have even caused diplomatic problems. Because of rising domestic demand, Tehran has been unable to meet its commitment to provide Iraq with electricity. Electricity shortages contributed to recent demonstrations and upheavals in Basra, which some key Iraqi political figures interpreted as an Iranian pressure tactic. These politicians ignored Iran’s own increased needs and the fact that Iraq owes Iran for already delivered electricity. In a tweet, Muqtada al Sadr said that those countries that want to influence Iraq’s politics by pressuring it will not succeed. Some demonstrators in Basra also displayed anti-Iran sentiments.

These economic difficulties even threaten President Hassan Rouhani’s government. Hardliners have called for his resignation and that of his entire cabinet, with some hinting that a military-dominated government would manage the economy better. Eventually, cooler heads prevailed, and a major political crisis was avoided. But the episode showed how politics in Iran have become increasingly vulnerable to economic developments.

These economic problems, coupled with social restrictions, are undermining Iran’s national unity. Water shortages are causing disputes between provinces that are relatively rich in water resources and those that are not. According to reports in the Iranian media, migration has increased from southern provinces to the northern parts of the country, a process that potentially could cause further problems. The government’s frequent calls for national unity are evidence of the country’s deep divides.

Many in the country blame American and international sanctions for these problems. The economic sanctions of the last decade have no doubt adversely affected Iran’s economy and exacerbated its other difficulties. However, Iran’s problems had already reached a critical level when the most severe sanctions were imposed in 2008. The more fair-minded observers, including some within Rouhani’s cabinet, admit that Iran’s problems have mostly domestic roots. Recently, Iran’s Minister of Intelligence Mahmoud Alavi commented that Iranians “are responsible for 60-80 percent of our problems. Outsiders only add seasoning, salt and pepper, to them.

Yet so far, there is no evidence that the regime is prepared to alter the outlook and policies that have caused Iran’s current problems. On the contrary, the hardliners in particular are continuing their ostrich-like behavior of burying their heads in the sand. Despite the demands of a group of politicians and intellectuals who wrote a letter recommending negotiations with Washington, they are adamantly refusing to talk to America. The commander of the Revolutionary Guards, General Mohammad Ali Jafari, said that if Iran talks to the United States, nothing would remain of the Islamic revolution. Such hardliners insist that Iran can overcome all its problems by relying on its domestic resources. Yet, their policies have exhausted and destroyed much of these resources. Ignoring the realities of international politics and economics, they are pinning their hopes on Russia and China to save them from their current predicament.

Iran’s Anti-Iran Sentiments

A major reason why Iran’s Islamists persist on continuing their bankrupt policies is their ideological and anti-Iran outlook. Unlike the Arab world and Turkey, where Islamists are also Turkish or Arab nationalists, Iran’s Islamists view Iran and its culture, especially its pre-Islamic dimensions, as rivals. Even the Iranian left, in contrast to other socialist movements like those of Russia and China, has anti-nationalist tendencies.

For instance, In response to a question about what he felt on returning to Iran in 1979 after so many years, Ayatollah Khomeini answered: nothing. For him and other Islamists, Iran did not and does not matter except as a launching pad for their ideology. Their priority is Islam and the Muslim world. They even have trouble mentioning the Iranian nation. It took Khomeini and other Islamists a decade and a devastating war with Iraq before they would use the term grudgingly. Since then, their use of Iran and Iranians has been merely instrumental. Only when it is in trouble does the Islamic Republic call on Iranians to love their country, be patient with difficulties, and help overcome them.

This outlook has also been responsible for Iran’s distorted and costly foreign policy priorities. Palestine, not Iran, has been the Islamists’ priority, which has isolated Iran and cost it so much in economic terms. Iran’s hardliners blame others for their anti-Iranian actions, but they fail to admit that their revolutionary policies have elicited these hostile reactions. They don’t seem to understand that states cannot challenge the international system and its key players without paying a price for it.

Greed and Lust for Power

When they came to power, the Islamists dismantled Iran’s economic and administrative infrastructure. Instead of professionals, they put uneducated and inexperienced people in charge of the country, including the running of its foreign policy. As a result, they forced a large percentage of the country’s best and the brightest, including those born after the revolution, to leave their homeland. They set up organizations whose sole purpose is the enrichment of the new ruling elite—which include certain influential clergy and their offspring, many of whom now live in Europe, Canada, or Dubai—as well as military organizations such as the Revolutionary Guards.

Corruption, cronyism, and abuse of power are nothing new in Iran. But under the Islamic regime, they have reached gigantic proportions, becoming a major cause of economic mismanagement. Moreover, for these elites, revolution and its slogans are mere instruments to retain their hold on power and to enrich themselves even if it means the impoverishment of the rest of the country. They enforce strict Islamic rules on Iranians, but their children often flout the same rules when abroad.

The son of the late President Ali Akbar Hashemi Rafsanjani, Mohammad Hashemi, was reported to have said recently that Iran is facing a worse situation now than in 1988, when Ayatollah Khomeini likened agreeing to a ceasefire with Iraq to drinking from a poisoned cup. Would Iranian leaders do the same today to save the country from further hardship?

The biggest responsibility lies with the Supreme Leader and the Revolutionary Guards. Would they be courageous enough to admit to past mistakes and set the country on a new course, with more cultural and political freedom and a more outward-looking and conciliatory foreign policy? More importantly, would they finally put Iran and Iranians ahead of unrealistic and selfish objectives? If not, they might go down in history as responsible for Iran’s demise.