Washington Report on Middle East Affairs, July 1992, pages 32-33

Will Rafsanjani's Election Victory Bring "Moderation" or More of the Same? Three Views

He Must Advance Economic and Political Reform

By Seyyed Vali Reza Nasr

Since the death of Ayatollah Seyyed Ruhollah Khomeini in 1989 the world has anticipated the "opening" of Iranian politics. The transition of power brought the putatively "moderate" Ali Akbar Hashemi Rafsanjani to the helm, and created an impetus for both wide-scale sociopolitical changes and a more pragmatic foreign policy.

Throughout the 1991 Gulf war, despite signs of uneasiness with U.S. policy, Iran maintained its neutrality, and resisted the temptation to form an anti-American front with Iraq. This policy of disengagement soon evolved into a cautious rapprochement with the West when, in 1991, Rafsanjani brokered deals with various Western powers through the good offices of the United Nations to secure the release of the hostages in Lebanon.

The government's pragmatic bent is also evident in its domestic policy initiatives. Since his assumption of the presidency, Rafsanjani has relaxed the state's tight control of the political and social life of the country. The once omnipresent revolutionary militias have been somewhat demobilized, the intelligentsia has more room to maneuver, and the government has turned a blind eye to lax observance of religious strictures such as the dress code among women.

Political liberalization has been closely tied to economic reform. To restructure the economy and reinvigorate industrial development, the government has promoted a much vaunted privatization plan. To provide skilled manpower to the industrial and financial sectors and to encourage investment in private enterprise, the government has since 1990 actively encouraged expatriates to return to Iran and to contribute to the economic life of the country. In a similar vein, the government has turned to the World Bank and the IMF to assist Iran with restructuring its economy.

Still, despite his initiatives, there has been no "spring" in Tehran, and the impetus for reform has not as yet become an unstoppable tidal wave. Progress on the economic front has similarly been held in check by the intransigence of the government's hard-line opponents in the bureaucracy and the parliament, so much so that by the end of 1991 all hopes for a rapid and facile liberalization process had clearly been dashed.

Rafsanjani defined the April 1992 parliamentary elections as the crucial battle which would decide the future of the Islamic Republic. If the election results are any indication, Rafsanjani now has the mandate to deliver on his promises. Pro-Rafsanjani candidates won between 70 and 80 percent of the seats in the two rounds of balloting, defeating numerous incumbent representatives who were affiliated with the radical faction. Clearly, Rafsanjani controls the various organs of state sufficiently to determine the outcome of elections.

With the elections behind him, Rafsanjani must now move quickly on the economic front. As riots in Arak and Mashhad in May have shown, the economic problems facing the country have reached crisis proportions. Iran's birth rate of 3.9 percent in the period from 1985 to 1990 was one of the highest in the world. The rapid rise in population has occurred at a time of slow economic growth caused by revolution and war. The result has been an increase in unemployment to 30 percent in 1991, according to some estimates.

Iran's high unemployment rate is exceeded by its soaring 300 percent inflation. The rial traded at the rate of 1,500 to the dollar, compared with 70 to the dollar before the revolution.

In fact, Rafsanjani's problems are not that different from those which faced Mikhail Gorbachev in his bid to change the Soviet Union. Rafsanjani may have gained control of the parliament, but he has not completely obliterated the radical elements and their base of power. They are in a position to mobilize key social groups by charging that Rafsanjani has betrayed the ideals of Khomeini.

If the radicals manage to create a firm alliance with the bureaucracy, as was the case in the Soviet Union, Rafsanjani's liberalization policies may face a formidable challenge.

Finally, Rafsanjani's eagerness to open the political system is checked by his fear of being held accountable for the excesses of the revolutionary regime throughout the 1980s. Whereas Gorbachev was able to dissociate himself from the legacy of Lenin or Stalin, Rafsanjani was part of the leadership responsible for Iran's defeat in the war with Iraq, economic stagnation, corruption, decline in per capita income, and political repression. By promoting an Iranian glasnost, Rafsanjani may set in motion a process that may well turn against him and undo the Islamic Republic. Rafsanjani's fate will depend on whether Iranians overlook his part in building the regime in light of his efforts to reform it.

Seyyed Vali Reza Nasr is the co-editor of Expectation of the Millennium: Shi'ism in History and assistant professor of political science at the University of San Diego.

Rafsanjani Removed His Rivals, But Not Iran's Problems

By Bahman Bakhtiari

Since the death of Ayatollah Khomeini in June 1989, Ali Akbar Hashemi Rafsanjani and his supporters have gradually taken control of major institutions. They strengthened the presidency and dissolved the post of prime minister; introduced tough legal and political requirements for candidates to the powerful Assembly of Experts (charged with overseeing the activities of the Spiritual Leader); initiated the integration of the Revolutionary Guards and the regular armed forces; and have improved ties with Britain and the Persian Gulf countries.

Finally, in the Islamic Republic's fourth election, in May 1992, pragmatists led by Rafsanjani routed most of the radical candidates and achieved a majority in the new parliament, which had been a stronghold of the radicals. Now Rafsanjani will be able to set in motion his pragmatic program without being undercut by the radicals, who question his ideological fidelity to Ayatollah Khomeini's political testament.

The program of the pragmatists to purge the parliament of radicals began nine months ago with the drafting of the Electoral Law. It stated that the Council of Guardians, a group of senior clergymen with conservative tendencies, will decide which candidates are eligible to participate in the election.

Since the Council members shared a distaste for the hard-line ideological disposition of the radicals, and the impasse they had created in the decision-making apparatus of the country, it was all but assured that most of the radicals would be disqualified.

More than 40 parliamentary incumbents were disqualified, including a deputy speaker, the leader of the former students who occupied the American Embassy in 1979-80, and four other personalities with a record of strong opposition to Rafsanjani. The final election results gave Rafsanjani's supporters some 200 out of 270 parliamentary seats.

Nevertheless, Rafsanjani faces very serious problems. Since he assumed the presidency in 1989, he has blamed the radicals for the rapid deterioration of the economy and the failure of his free-market initiatives. Now, with the radicals purged from parliament, the electorate will be looking impatiently for some tangible economic improvement.

Nor does the defeat of the radicals necessarily mean that the government is now able to implement its policies without hindrance. Internal factionalism is only one of its problems. More serious obstacles are the absence of a trained labor force, centralized decision-making, and the lack of international interest in providing financial assistance for an Iran ravaged by its eight-year war with Iraq.

Another major factor facing President Rafsanjani is the incredible bureaucratic logjam and the absence of organization among various ministries. The government has attempted to alleviate this problem by reducing regulations, but this has not reduced bureaucratic rivalries. Since the inception of the Islamic Revolution five new ministries have been created.

President Rafsanjani must integrate or eliminate many of these bureaucracies in order for his economic programs to succeed. But what would he do with those bureaucrats whose revolutionary credentials go them their jobs? Tough decisions involve political risks, and the longer he waits the higher the costs.

Compounding these structural problems, the government has had difficulties improving its international image. President Rafsanjani is very popular among educated, middle class Iranians, yet he has not been able to extend this positive personal image to the totality of his government.

As James Madison stated, "There are two methods of curing the mischiefs of faction: the one, by removing its causes; the other, by controlling its effects." So far, President Rafsanjani has confined himself to the latter.

Bahman Bakhtiari is assistant professor of international affairs at the University of Maine.

After Electoral Victory, Economic Challenges

By Said Amir Arjomand

In February of this year, the Iranians celebrated the 13th anniversary of the Islamic Revolution, and in June they observed the third anniversary of Ayatollah Ruhollah Khomeini's death. The emergent pragmatism in Iran's foreign and economic policies has correctly been associated with President Ali Akbar Hashemi Rafsanjani. The resounding endorsement of Rafsanjani in the Majles (parliament) elections in April and May seemed to signal the definitive settlement of the revolutionary power struggle and of the problem of succession, and therefore the coming of an era of political stability, peace and economic prosperity.

By the end of May, however, serious riots had broken out in Arak, Mashhad and other cities, and government offices had been attacked and burned. How are we to read these contradictory signals coming out of Iran?

The results of the elections for the Fourth Majles can be interpreted as a truly impressive victory for President Rafsanjani. They also demonstrate the president's control over the political machinery of the Islamic Republic, and his victory after a protracted power struggle with the radicals.

All of the candidates in Tehran endorsed by the pro-Rafsanjani Society of Militant Clergy of Tehran were returned, whereas every single radical was defeated.

There can therefore be no doubt that Iranian voters want to put behind them nearly a decade and a half of revolution and war, and want peace, normalization of international relations, and revival of the economy at home.

The power struggle between the pragmatists and the radicals since the death of Khomeini has been unusually protracted. Rafsanjani could have clamped down on the radicals who had lost Khomeini's protection, but chose not to. As he slowly eased the radicals out of positions of power, however, they continued to engage in international acts of terror, at least some of which sabotaged Rafsanjani's foreign policy.

The assassination of the former prime minister, Shapur Bakhtiar, in Paris last summer, for instance, was highly embarrassing for Rafsanjani and the pragmatists in charge of foreign policy, who had planned a state visit to Iran by French President Francois Mitterand.

With their electoral defeats and loss of a power base in the Majles, however, the radicals are less likely to embark on further ventures in international terrorism.

Economic prosperity is another matter. Here, Rafsanjani faces enormous difficulties that stem from the strangulation of the economy by the state and its revolutionary organs.

Large-scale nationalization of enterprises in the industrial and service sectors of the economy followed the revolution in 1979.

Although privatization is talked about, it is difficult to achieve because most such enterprises lose money, and denationalizing them runs counter to the interests of officials earning miserable salaries whose offices are their only means of enrichment. To make matters worse, with the end of the Cold War and the lack of interest in Iran on the part of the United States, Rafsanjani cannot count on any significant foreign aid for economic reconstruction.

Deteriorating economic conditions are the obvious cause of the recent disturbances in the Iranian cities. The immediate cause of urban unrest in Arak and Mashhad was the eviction of squatters from private property or property owned by religious endowments. Such evictions, which belie the cherished populist slogans of the Islamic revolution and show the harsher side of privatization, indicate the magnitude of the economic problems President Rafsanjani and his administration have to face. A strongly supportive Majles is perhaps necessary for overcoming these economic difficulties, but it is by no means sufficient.

Said Amir Arjomand is professor of sociology at the State University of New York at Stony Brook and author of The Turban for the Crown.