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At the start of this month, the Iranian currency—the rial—lost 17 percent of its value in one day. In the last year, its value plunged 75 percent against the U.S. dollar. The leader of the Iranian Revolution, Ayatollah Ruhollah Khomeini, who championed hatred for the West and particularly for the U.S., must be turning over in his grave. His portrait, which appears on the Iranian bills, is rapidly paling in comparison with the portrait of George Washington on the American bills.
At this rate, pretty soon it won’t just be Khomeini’s portrait plummeting; his ideology will also be abandoned. But the problem for Jerusalem, and for the Iranian people for that matter, is that the uranium enriching centrifuges are continuing to spin, regardless of whatever else is happening.
Today, the Iranian regime also has a problem. It is true that the current regime is one that thrives on crises, but this time the threat could be tougher and more severe than anything this regime has faced between 2000 and 2009. The people are in pain, and it is not clear how much longer they will be willing to remain quiet. Workers at one Iranian plant have already declared that they refuse to continue protesting quietly and petitioning the Labor Ministry. They want to go out into the streets.
Indeed, riots erupted near the marketplace in Tehran on Oct. 3 due to the economic crisis, which sparked clashes between vendors and demonstrators on one side and security forces on the other. Many vendors refused to open their shops, and gas stations also remained closed. Reports detailing the amount of money the Iranian leadership had transferred to the government of Syrian President Bashar al-Assad—a total of $10 billion—only served to fuel the anti-government sentiments.
The Oct. 3 demonstration came only one day after Iranian President Mahmoud Ahmadinejad convened a somewhat entertaining three-hour press conference in which he addressed the severe economic crisis that has befallen Iran as a result of Western sanctions. Sanctions imposed because, as Ahmadinejad promised, “Iran will not abandon its nuclear program.”
In Washington, U.S. officials are trying to highlight the assessment that the sanctions are working. State Department spokeswoman Victoria Nuland explained this week that the precipitous drop in Iran’s currency reflects relentless international pressure on the country. Factually, she is right. But the real question is how much the Iranian leadership actually cares about the suffering of the Iranian people. During the eight-year Iran-Iraq war, the daily funerals didn't seem to sway the Iranian leadership from pressing on with its war.
Iranian authorities have found a nice way to combat the economic woes: Instead of halting nuclear development, they’ve decided to stop the black market foreign currency trade. Police officers raided Ferdowsi Square and arrested the traders and their customers. The move did not boost the regime’s popularity, but it did spark a riot.
Tehran’s Ferdowsi Square was the source of anger, protest and frustration on Oct. 3. Calls criticizing Iran’s president could be heard around the square: “Ahmadi, the people are not with you.” At the first sight of police, the shop owners closed their shops, only enraging the police even more. Because of the rial’s dismal state, even the bazaar closed its gates—the same bazaar that actually supports the conservative Iranian leadership and is considered one of the regime’s strongholds.
At first, the Iranian authorities didn’t give much credit to the European Union’s embargo on Iranian oil exports, which took effect on July 1. But after six rounds of sanctions imposed by the United Nations Security Council since 2006, it seems that this EU embargo is the most painful.
European nations had once purchased 20 percent of Iran’s oil exports. Until six months ago, Iran was exporting 2 million barrels per day. Today this number has dropped to 800,000 barrels per day. If we take into account the fact that 85 percent of Iran’s total income is derived from oil exports, we can easily understand why the Islamic Republic of Iran is feeling the economic strain.
Data coming from the International Monetary Fund is also discouraging. According to the fund, Iran had reserves worth $106 billion in foreign currency at the end of 2011. “At this rate, Iran will lose $40 billion to $50 billion per year, despite the high cost of oil,” explained Thierry Coville, an economist specializing in Iran. This clearly prompts Iran’s central bank, which is supposed to pump foreign cash into the flailing Iranian market to ensure balance for the local currency, to empty its foreign currency coffers. This certainly doesn’t bode well for the bills carrying Khomeini’s portrait. At this rate, they will soon become cheap collectibles rather than a bill you can take to the bank.
At the beginning of the millennium, European nations couldn’t understand Israel’s paranoia about Iran’s nuclear program. Today, even if it is not entirely enough, things look very different. Recently, one Western diplomat recounts, several locals gathered for dinner at the home of a Western businessman in one of the posh neighborhoods of northern Tehran. The atmosphere was heavy. The guests complained that they could not afford to purchase basic products, despite their high class standing in Iranian society. Once, after the 1979 Islamic revolution, the joke was that Khomeini was combating divorce rates, since, as a result of the revolution, young people were not able to marry. Now, the new joke on the streets of Tehran, the diplomat says, is that the sanctions will give Iranians cavities, since they can no longer afford toothpaste. The price of toothpaste has tripled just this month.
The Iranian streets
Iran’s Supreme Leader Ayatollah Ali Khamenei and President Ahmadinejad should be most concerned about the poor—the population that has been subsidized by the regime. In June 2009, when demonstrators took to the streets to protest fraud in the presidential election, the authorities organized counter-demonstrations. They had no problem enlisting the poor from Tehran’s southern neighborhoods and suburbs, those people subsidized by the state, to take part in the counter demonstrations.
The Iranian revolution promised to improve the lives of the average Iranian citizen, but reality proved otherwise. The average wage earned by an unskilled Iranian factory worker ranges between $95 and $220, below the country’s poverty line. The petition, signed by tens of thousands of brave workers, was even sent to the Iranian labor minister. The minister and his team have yet to respond.
Jafar Azimzadeh, a labor-rights activist and gas-pipe fitter, was not afraid to give his full name in an interview with The Associated Press. Even before the Oct. 3 demonstration, he warned of stronger fallout if the government does not find ways to prop up salaries and rein in prices. “Workers would not stay at the level of writing petitions,” he said. “They would go toward street gatherings and other actions.”
“There is a total lack of faith in the government's ability to extricate Iran's economy from the situation it is currently in,” explained one economist. “All this frustration could certainly spark another wave of protests against the regime, but this time it could be much worse because the lower class is no longer willing to come to the aid of the regime. The lower class is greatly suffering itself.” This hasn’t happened since the 1979 revolution.
A play for time
There are also those who doubt that the change will come from the Iranian street. “We are not there yet,” says one Iranian reporter stationed abroad. “To bring change, many young people, and many elderly and women, will have to sacrifice their lives, and I’m not certain that they are ready to do it.”
So are we on the brink of a “Persian Spring?” Will the Iranians really pressure their government to abandon the nuclear program, which is, according to that government, a source of pride? It is hard to say. On the one hand, Iran is a nationalist country and there are many within it who do view the nuclear program as a source of national pride, but on the other hand, there are also those who have grown tired of the Iranian leadership and its messianic dreams, and want to live normal lives.
In the meantime, Khamenei will do everything to survive in power until next June, when Ahmadinejad, whom he hates, will have completed two terms and stepped down. Khamenei is playing for time, again. More and more, the entire Iranian issue—the regime and the bomb—is becoming a game of time. Which will fall first, the regime or the nuclear project? We will have to wait to find out.
Boaz Bismuth is a correspondent and columnist for Israel Hayom. This story is distributed with the permission of that newspaper.