“From an economic and standard of living perspective, the people are under immense strain,” Iran’s First Vice President Eshaq Jahangiri recently proclaimed. “We understand these problems and are ashamed before the people.” His comments come as crippling US sanctions and the COVID-19 pandemic have spurred deep economic decline and a pervasive sense of hopelessness and anguish among many Iranians.
Iran has been gripped by labour strikes, rising inflation, and increasing poverty in recent months. According to Ayyub Faramarzi, the deputy head of the Statistical Center of Iran, prices on 475 goods have increased by an average of 26 percent across the country, putting Iran among the four countries with the highest levels of inflation.
Meanwhile, according to a recent report by Iran’s Parliamentary Research Center, Iran’s rate of poverty has increased from roughly 15 percent in 2012 to more than 18 percent in 2019. Per capita income has also decreased by 34 percent over this period. Given the pandemic and ever-tightening US sanctions, these figures likely worsened this year. In a sign of how the situation has deteriorated, delayed wages recently led to strikes in Iran’s critical oil and gas industries.
Amid the severe economic downturn, factional infighting in Iran’s quarrelsome political system has grown fiercer. The new conservative-dominated parliament has been relentless in its attacks on President Hassan Rouhani’s administration. Recently, Iran’s Foreign Minister Javad Zarif was summoned before the body, where he was grilled by hardline parliamentarians who called for his prosecution and chanted, “death to the liar!”
However, while current economic and political conditions in Iran are dire, there are also compelling reasons to believe that the Iranian system is more resilient than it appears. The country’s decision-making elite, while racked with internecine feuds, have shown they will put aside their differences on matters where the survival of the country is at stake. Furthermore, despite the battering the economy has taken, there are no indications it is on the verge of collapse.
US pressure is forcing elite cohesion
“The enemy does not seek to destroy the presidential administration, but the whole system,” Rouhani recently declared. He was discussing the need for unity and increased coordination among Iran’s competing branches to withstand US pressure. Rouhani added that his administration “alone” could not resolve “all of the system’s problems”.
Rouhani made the admonition as he enters the final year of his presidency. A political moderate within the country, he was first elected in 2013 on a platform of “hope and prudence”. He pinned his political fortunes on diplomatically resolving the dispute over Iran’s nuclear programme and securing Iran’s integration into the global economy. However, those hopes were dashed by US President Donald Trump’s abrogation of the nuclear deal Rouhani had negotiated with global powers and the reimposition of severe economic sanctions. Since then, Rouhani’s domestic opponents have acted as wolves scenting opportunities.
On July 5, hardline parliamentarians aggressively questioned Foreign Minister Zarif over his handling of Iranian foreign policy and the nuclear deal, blasting him for naively giving concessions to the US. After that, more than 200 members of Parliament (of the 290-member body) called for Rouhani to be brought in for questioning next. A smaller group of members of Parliament also introduced impeachment proceedings against the embattled president.
Around the same time, Iran’s reformist Etemad newspaper reported on a squabble between Rouhani and conservative parliamentary speaker Mohammad Bagher Ghalibaf. According to Etemad, during a meeting of senior officials, Rouhani got into an argument with Ghalibaf over an economic proposal he had given to Supreme Leader Ayatollah Khamenei. The proposal, offering an alternative approach to addressing Iran’s economic malaise, was seen by Rouhani as challenging the traditional domain of the presidency on managing the economy. Rouhani, it seemed, was on the verge of being stripped of any meaningful authority.
However, just as the simmering dispute was set to escalate, it was tempered by Supreme Leader Khamenei. In a virtual speech to parliamentarians, the 81-year-old ayatollah shut down talk of impeaching Rouhani, saying his administration must “work until the end of its term”. Khamenei also called on the country’s various institutions to avoid conflict: “At this sensitive time of the administration’s last year in office and the [new] parliament’s first year, the two institutions must govern and manage their space in such a way as to not harm important work in the country.”
Soon after, Rouhani and Ghalibaf closed ranks. Rouhani hailed Khamenei’s emphasis for “all branches [of government] to be ready to coordinate against the enemy’s economic warfare”. Ghalibaf followed suit by saying there was “total coordination” among all governmental branches on economic policy. The two then joined judiciary chief Ebrahim Raisi in approving a new plan to increase government revenue by selling oil securities to the public.
Anger in the streets
While Iranian politics is combative and the give-and-take between various branches of the government will undoubtedly pick up steam again, there is still an underlying cohesion to the political system. This cohesiveness is clearly bolstered by the US’s regime-change rhetoric and actions. As recent developments show, Iranian elites draw a line on their internal bickering and seek to send a message of unity to Washington.
However, Iranian society is another question. Demonstrable discontent in Iran has been on the rise, and there is palpable frustration in the street about economic conditions and corruption. Last November, widespread protests broke out in response to an abrupt government decision to increase the price of gasoline, leading to a violent crackdown on protesters amid an internet blackout that led to at least 304 deaths, according to Amnesty International.
Renewed unrest cannot be discounted, especially as Iranians continue to experience extreme hardships. American interference also plays a role in this regard, given what Steven Simon, a former director in the Obama White House’s National Security Council, has described as “US efforts to create the collective anarchic conditions in Iran that would precipitate the overthrow of the regime or at least a strong challenge to it”. Nevertheless, the government’s security apparatus has shown its commitment to the system and willingness and ability to brutally suppress protests.
However, on the economic front, some stability may loom on the horizon. The Iranian economy has weathered the worst of US sanctions and was showing signs of recovery just as the coronavirus crisis hit. Even now, prominent Iranian economists such Saeed Laylaz argue that Iran is better positioned to bounce back from the coronavirus crisis, as its economy is largely severed from the world and domestic production and job creation have been on the rise. Both the IMF and the World Bank also project the economy will rebound in 2021.
Iran is staying afloat
Many in Washington eagerly watch for signs of increased discord inside Iran. However, while the country is in trying times, it does not appear to be in a state that would augur its collapse or surrender to far-reaching US demands. The Iranian people are suffering, while the elite has homogenised in a rightward direction and more moderate voices are increasingly sidelined. US pressure is in many ways cementing the system at the expense of the livelihoods of Iranians.
The views expressed in this article are the author’s own and do not necessarily reflect Al Jazeera’s editorial stance.