If you want to find out what economic chaos looks like, forget about Athens or Madrid: Tehran is the capital to study. Sanctions have crippled the country to such an extent that for most Iranians day-to-day life is becoming impossible. It is true that not a single shot has been fired, but sanctions are indeed a form of warfare, imposing hunger and destitution on the population. And if the US presidential race remains close in these last days before the poll, the Obama administration could yet consider a military strike.
Of course, Iran’s economy is not crippled just because of sanctions. Decades of obedience to the International Monetary Fund have left the country with a privatised, corruption-riven economy. The gap between rich and poor is wider than at any time in living memory. Food and fuel subsidies have been abolished by Islamic clerics—to the applause of the IMF and World Bank. In other words, even without sanctions Iran would have had all the features of a third-world capitalist country suffering from the effects of the global economic crisis. But sanctions have made life so intolerable that people will tell you that hunger and poverty, combined with this constant fear of military conflict, is worse than war itself.
Sanctions
The first sanctions against Iran were imposed in 1979. However, Tehran was able to circumvent the worst of their effects until 2006, when measures relating to Iran’s nuclear industry were introduced, to be followed by further UN resolutions between 2007 and 2010. But the situation was transformed with the new wave of sanctions that started in January this year, when the United States and European Union took steps to ensure Iran could not sell its oil overseas and imposed restrictions on all Iranian banks and financial institutions. In the first few months of 2012 the Islamic government deluded itself that these were short-term steps and therefore spent its reserves of foreign currency in order to maintain the value of the Iranian rial. However, as the new sanctions began to bite, in the face of US and Israeli military threats, the exchange rate plummeted.
A series of United Nations-backed measures reduced the country’s oil exports from 2.5 million barrels a day to 1.5 million in early 2012. Major shipping companies now refuse to send their tankers to Iranian ports, in fear of the severe fines imposed on sanction-busters. Any international bank doing business in Iran is now deprived access to the US market and unsurprisingly most financial institutions have ended their dealings with Tehran as a result. In July new EU sanctions banned oil imports from Iran entirely. Europe was purchasing 20% of Iranian exports—hence the devastating effect on the Iranian rial.
In early October the currency lost 75% of its value against the dollar, and the rate of inflation is now so high that many shops are refusing to sell goods, as they know prices will rise from one hour to the next and what they receive in sales today could be worthless tomorrow. In Ferdowsi Square, where most major currency exchange dealers work, some have hung signs saying, “Dollars not bought or exchanged” in protest against the government’s plans to set a fixed rate for the rial.
Wary of riots in response to food shortages, the Iranian government has announced a classification of imports into 10 categories, based on how essential they are. Importers of essential goods will be able to buy dollars at a subsidised rate, while importers of goods classified as non-essential will have to pay hand over fist to obtain dollars.1 However, a thriving black market in luxury goods—including those dubbed ‘unIslamic’—has characterised the 33-year rule of Tehran’s corrupt, religious, capitalist regime and few expect this to change.
Prices for staple foods, such as milk, bread, rice, yogurt and vegetables, have doubled since the beginning of the year. Chicken, the cheapest meat, is so scarce that every time supplies become available there are long queues and sometimes riots. Unemployment is thought to be around three times higher than the official rate of 12%, and millions of unskilled factory workers are on wages well below the official poverty line of 10 million rials (about $250) a month.
On October 12 yet another set of sanctions was finalised by EU foreign ministers in Luxembourg. The aim was to “further restrict Iran’s ability to move money around efficiently—a step to aggravate the current financial crisis of the Iranian regime inside the country”.2 A number of international airlines responded by stopping their flights to Tehran. The message conveyed by this relentless pressure is clear: you are under siege, and you are isolated. It is a form of psychological warfare—not just against Iran’s rulers, but against the population. According to Mark Dubowitz, executive director of the Foundation for Defense of Democracies and a proponent of still tougher measures, “repetition is the key to success of message-penetration”.3
Throughout the last few years supporters of sanctions have told us they are not directed at the Iranian people. No, they are ‘targeted’ sanctions, aimed only at the regime. Nothing could be further from the truth. First of all, senior clerics and military generals have been the main beneficiaries of privatisation and, as a result, they own a considerable chunk of Iran’s economy. The rest, including whatever is left of public services, is dependent on state funds, which are squeezed further by sanctions. As for the fortunes of senior clerics and their offsprings, it is safe to say little of it remains inside Iran—by 2007 they were already ensuring that their personal wealth had left the country for the safety of foreign banks. The main victims of sanctions have been the mass of the people—including workers made redundant, as senior ayatollahs and leaders of the Pasdaran Revolutionary Guards have closed down their businesses and moved their money into Swiss bank accounts. Iran’s car industry has shed almost half of its workforce and oil workers have also lost their jobs, as oil exports have gone into free fall.
Effects
Launching our anti-sanctions campaign in 2009, Hands Off the People of Iran declared: “The current proposals of the US government to enforce sanctions on Iran’s oil industry would unquestionably cause chaos for a society depending on oil for its national income. They are also a disaster for the cause of democracy because they limit working class struggle.
“Radical democratic change in Iran (and indeed in the imperialist countries such as the US and UK) can only come from below. It cannot be gifted by the likes of Moussavi, or imposed by the imperialists. Not that either would wish to see such change. We have to aid such advances through promoting working class internationalism—the core politics that Hopi implacably stands for.” 4
However, the effects of current sanctions are far worse than we predicted in 2009. There is a serious shortage of drugs affecting both the rich and the poor. Tehran residents report long queues of poorer sections of the population outside chemists in more affluent suburbs trying to sell their prescriptions so that they can buy food for their families. Hospital notice boards are full of adverts for the sale of kidneys and other organs—a new method of raising funds.
Government employees have not been paid their full salaries for many months. Many make ends meet by selling their household goods, such as furniture. And, although unemployment is affecting every section of the working class, women have been amongst the first to lose their jobs and therefore any degree of independence in a patriarchal society. Government statistics show female unemployment to be around 43%. There are reports of an unprecedented rise in casual prostitution, while social workers have raised concerns about an increase in the level of reported violence against women and young girls, as economic hardship affects family relations.
In the midst of all this misery David Cameron dismissed speculation about an Israeli attack “that might strengthen the Islamic regime”. He called on the “international community” to “show the courage to allow sanctions against Iran to work”.5 The British prime minister is talking of the “courage” of the imperialists in inflicting devastation on ordinary Iranians. And Iran’s brutal clerical regime could not care less what happens to its population—sanctions could continue for years and the real victims will still be the Iranian people.
In a move reminiscent of Ruhollah Khomeini’s fascistic call on Iranians during the Iran-Iraq war to have more children, so that a new generation could defeat the Arab invader, Iran’s current supreme leader, Ali Khamenei, has also urged his subjects to reproduce more. However, there are two major problems with this: (1) the US and Israel are not Saddam Hussein—Iran’s population could rise tenfold and it would not make an iota of difference in a war against two nuclear powers; (2) the Iranian women of 2012 are not those of 1982: they are too aware of the nature of the regime to be told when they should reproduce and how many children they should have.
Given the level of economic hardship, working class actions have been few and far between—workers are forced to take on second or even third jobs to pay their extortionate rents and are forced to spend hours in queues to feed their families. However, this month has seen a number of workers’ protests. A petition addressed to Iran’s minister of labour has been secretly circulating among factories and workshops. By mid-October some 20,000 workers had signed the document, pointing out that wages agreed in March have lost half of their value—rent and food prices have doubled, and working class families cannot survive.
Meanwhile, 600 metal workers held protests outside the ministry on October 13 and managed to close one of the capital’s busiest streets for almost an hour. This was followed the next day by another demonstration outside the offices of Tehran’s provincial governor. Earlier, on October 10, hundreds of bus drivers from Tehran and the provinces had protested for four and a half hours outside Tehran’s main municipality offices. These drivers have not received the 10% pay rise promised to all city employees.
Support
These are the kinds of actions we should support. We in Hopi are true to our slogan, ‘No to imperialist war and sanctions, no to the clerical regime’. Today, at a time when sanctions have become an important weapon in imperialism’s arsenal, at a time when they are supposed to pave the way for the downfall of the regime, as the population becomes desperate, we must reiterate our opposition to ‘regime change from above’. In the absence of a movement from below, sanctions will produce one of two outcomes: either the regime will survive, becoming even more repressive; or it will be replaced by the US’s chosen coalition.
It is no accident that the latest sanctions have coincided with concerted efforts by the US/EU to finance and organise the most reactionary forces aiming to benefit from the economic chaos. The son of the shah is being promoted ad nauseam in US-funded TV stations broadcasting to Iran, while the People’s Mujahedin (MEK) have been removed from the US ‘terrorist’ list, so that they can take their place among the ‘patriotic forces’ being groomed to replace the Islamic regime.
Similarly, naive and opportunist sections of the left have rushed to join forces with ‘human rights’ organisations sponsored by the US-funded National Endowment for Democracy in the anti-regime, pro-western Iran Tribunal, and there are attempts to lure the discredited ‘leaders’ of the green movement into this unholy alliance. In the meantime labour activists languish in Iranian prisons, and those attempting to set up independent workers’ organisations are in constant danger of arrest, imprisonment and worse.
Hopi’s principled opposition to the Iran Tribunal is not because we are soft on the Islamic republic, as our opponents have alleged. On the contrary, we are committed to the revolutionary overthrow of the Islamic regime and all its factions. However, we believe alliances pretending to pursue a ‘non-political’, ‘human rights’ (read rightwing, pro-imperialist) agenda are a serious threat to the future of the revolutionary movement of workers in Iran. Those sections of the left who cannot see (or who pretend they cannot see) the serious risks posed by their collaboration with those involved in regime change from above, such as the Iran Tribunal, will become mere pawns in a game where the winner is international capital (and that inevitably includes Iranian capital).
2. ‘EU moves closer to new Iran sanctions’: http://uk.reuters.com/article/2012/10/12/uk-eu-iran-san...21012.
3. ‘Obama implements additional Iran sanctions’: www.jpost.com/IranianThreat/News/Article.aspx?id=287319.
5. ‘Iran sanctions need time to work, David Cameron says’: www.bbc.co.uk/news/uk-politics-19957218.