“We cannot easily tell people that we are at war,” the Iranian First Vice President Eshaq Jahangiri said on Wednesday 19 December 2018. By alluding to war in his remarks, Jahangiri was referring to the US sanctions and the targeting of Iran’s economy. However, the rest of Jahangiri’s statement revealed that there is not only a war with the United States, but also a domestic war ensuing between President Hassan Rouhani and his government on the one hand, and the Supreme Leader and his apparatuses, on the other hand. Jahangiri said that the government’s authority on approving the budget was limited, as well as, its authority on determining which institutions should be allocated funds or not. He also wondered about the institution that should be fundamentally responsible for allocating and spending government funds.
Indications of the comments
Jahangir’s remarks are important because of his position. He is the second most important official in the government after President Hassan Rouhani. His view, no doubt, reflects President Rouhani’s view. In addition, he leads the Resistant Economy Council. His criticism undoubtedly stems from the fact that he is facing fundamental obstacles while trying to fulfill his duties.
These remarks come at a time when there is rising public discontent due to deteriorating socio-economic conditions, high prices, and volatility in the market after the United States reinstated sanctions on Iran. These sanctions have deprived the Iranian government of a large share of its oil revenues. Also, the government’s austerity policies have hit the public hard leading to public anger being directed towards the regime, while the Rouhani government has tried to distance itself from bearing any responsibility. It has done this by presenting itself as being limited, as well as, shifting the blame on to some institutions that are running the economy and are above accountability and transparency.
The remarks come at a time when discussions surrounding the budget for the new year are ongoing, that will begin in March 2019. The Rouhani government leaked details of the previous year’s budget, and the details were widely circulated on social media in Iran, and used by the opposition to attack the regime. By such leaks, Rouhani intended to raise awareness around funds that were allocated to institutions under the control of his hardline opponents and to trigger the biggest protests the regime has faced since 2009.
It is clear, Jahangiri, as he did last year when the budget was being debated in parliament amid very delicate circumstances, has attempted once again to revisit the issue again and to expose the hardliners who continuously refuse to allow the accountability of the institutions that they control. They have spared no effort in holding the Rouhani government responsible for the deteriorating socio-economic conditions to dwindle its popularity and to avoid responsibility for the crises, which are ever-growing inside Iran.
The remarks were preceded by a wave of anger among the hardliners in Iran after the Foreign Minister Mohammad Javad Zarif declared, “money laundering is a reality in Iran.” He added, “internal parties oppose the passage of the law against the financing of terrorism, including apparatuses whose budget exceeds the budget of the Ministry of Foreign Affairs, and play key roles in the process of money laundering.”
The reaction to the hardliners’ attack
This attack by the hardliners on Zarif cannot be explained without mentioning that they have led a campaign in holding the Rouhani government responsible for Iran’s economic problems. They have had the opportunity to score several points against President Rouhani and his team in recent times.
A great opportunity, came after President Donald Trump withdrew the US from the nuclear agreement and imposed sanctions that have impacted Iran’s internal situation. The hardliners have criticized Rouhani’s openness to the West and his confidence in the United States, as well as, all the subsequent results of this approach. However, Rouhani could not have opted for this approach without the approval of the wings of the regime and its constitutional bodies that have the actual power in Iran.
The hardliners have exploited the internal Iranian situation to meet several aims, the most important being direct intervention in determining government’s policies, especially the economic ones, forcing some changes in the government, and holding the government responsible for the country’s economic failure. They sought to evade any responsibility for Iran’s grim reality as if the responsibility rests entirely on the shoulders of Rouhani’s government.
Instead of the hardliners curbing the financial and economic role of the Revolutionary Guards and the institution of the Supreme Leader, the governor of the central bank and a number of government ministers were dismissed. Also, Rouhani himself was questioned. Attempts were made to question Zarif to determine his suitability in carrying on in his position. But, it is important to note that the top authority within the regime does not want to cause political chaos in the current circumstances. Also, Rouhani’s staying in office is of importance as he is the scapegoat that can be used by the Supreme Leader and his wings in case of any domestic or foreign policy failure.
Rouhani exploited the atmosphere of openness post signing the nuclear agreement and put forward a reformist economic project. His declared goal was in line with the lifting of sanctions on Iranian oil exports, the lifting of restrictions on financial, trade and investment transactions with Iran and the release of its assets frozen abroad. His objective was to strengthen his position and influence within the regime by targeting his hardline opponents by trying to counter the economic and financial influence of parallel institutions within the regime, especially the Revolutionary Guards and the institution of the Supreme Leader. The first has become a major economic power. This power supports its political and military role. Also, he aimed to place part of the responsibility on the shoulders of the hardliners, particularly, so that the public could be aware of the power balance inside the system.
Forty years after the Iranian revolution, mutual accusations between the Rouhani government and the hardliners shows the enormous imbalance that the regime suffers from. The imbalance is clear in the lack of accountability, responsibility, and harmony among the key decision-making institutions, as well as, by the fact that they overlap and duplicate one another in the system. The president has no control over the state budget, and cannot prioritize it. And the government is unable to restrict the parallel institutions.
What Jahangiri revealed shows the real crisis the country is going through at a time when a new budget is to be approved. There are recent attempts by Rouhani and his officials to defend themselves in the face of accusations that may affect their future and their positions of power, especially as the internal crisis is likely to worsen. After he lost his bets at home, Rouhani is losing his foreign policy bets one after the other. The nuclear deal is suspended and the US is tightening the noose around the Iranian economy. This boosts the position and stature of the hardliners. The Rouhani government will undoubtedly be the scapegoat that will be prepared in advance. But it does not want to exit the battle with the hardliners, given it has diagnosed the real problem that is draining the country’s resources and scattering its ambitions. It wants all parties to bear the same responsibility for any failure before the public.