US President Donald Trump used his speech to the UN General Assembly on 25 September to call for Iran’s isolation, holding its leaders responsible for sowing “chaos, death and destruction”. The next day, he tried to garner support for sanctions at the UN Security Council. The EU, meanwhile, has pledged engagement with Tehran, affirming its commitment to the 2015 nuclear deal between Iran and seven other signatories Trump withdrew from this year.
It is unclear how the US-EU tussle over Iran will play out, but one thing is certain: the Iranian regime is experiencing unprecedented levels of pressure. Crucially, this pressure derives as much from growing domestic discontent as from the frosty reception Iranian officials may receive in New York. And this is what worries the regime the most.
It has become commonplace to view all of Iran’s ills through the prism of Trump’s withdrawal from the nuclear deal. Such a view suggests that everything in Iran was going well before Trump pulled the plug. It was not. Dissent was high even when the US was a signatory to the deal, as seen in the December 2017–January 2018 protests, in which 25 people were killed.
In many ways, the current situation is far more serious even than the 2009 Green Movement riots. Dissent is no longer about fraudulent elections, as it was then, but about bread-and-butter issues. The demographics have also changed. Dissatisfaction with the status quo is no longer exclusive to the metropolitan middle class, as in 2009. It is now widespread and particularly high among working-class Iranians—the regime’s traditional support base. This should come as no surprise: they have been hit hardest by the country’s ailing economy. Reports indicate that rampant inflation and high prices have meant many poorer families can no longer afford to buy staples like meat and rice.
The Iranian regime is experiencing unprecedented levels of pressure. Crucially, this pressure derives as much from growing domestic discontent as from the frosty reception Iranian officials may receive in New York.”
While the official inflation rate stands at 10 per cent, Professor Steve Hanke from Johns Hopkins University has estimated that the actual rate is as high as 293 per cent. Iran’s currency, the rial, has yet again hit a record low against the US dollar, losing approximately 75 per cent of its value since the start of 2018.
The response of Iran’s leaders to the turmoil has only added fuel to the fire of Iranian grievances. While Foreign Minister Javad Zarif alluded to how Iranians “had chosen this path”, Ayatollah Ahmad Jannati, head of the influential Guardian Council, claimed the state of the economy was “God’s work”.
Trump has made his approach towards Iran perfectly clear: maximum pressure to force a change of behaviour. The US withdrawal from the nuclear deal and the reimposition of nuclear-related sanctions have given Iran a flavour of things to come, with sanctions on Iranian oil sales—Tehran’s main source of revenue—scheduled to take effect from 4 November. Speaking at an Iran fringe event in New York on 25 September, US National Security Adviser John Bolton warned Iran’s leaders they would have “hell to pay” should they harm the US or its regional allies.
In contrast, the EU’s strategy focuses on carrots rather than sticks. Reaffirming its commitment to the 2015 agreement, the EU has announced plans for a legal framework that would evade US sanctions to uphold business with Iran. This month, the EU also unveiled an €18 million ($21 million) aid package for Iran, designed to offset the impact of US sanctions and enhance cooperation with the Islamic Republic. When pressed on this ‘soft’ diplomatic approach, EU foreign policy chief Federica Mogherini responded, “Is war the alternative?”
It has long been the Islamic Republic’s goal (and policy) to split the Europeans from the Americans in their approaches towards Iran. However, having now achieved this ambitious objective, Iran’s leaders are not enjoying the comfort from the US-EU break-up they might have expected. This is primarily because of an unprecedented level of domestic pressure.
External pressure has undoubtedly contributed to Iran’s economic meltdown, but Iranians are increasingly blaming their own leaders’ ideologically driven policies for their falling living standards and the poor state of the economy. Many of the public’s grievances stem from the priority the regime has given to allocating Iran’s resources abroad—including billions of dollars—in support of its regional proxies, despite domestic suffering. All of this has been with the higher aim of expanding the scope and influence of the Iranian Revolution.
Take Syria. Conservative estimates suggest Iran spends more than $6 billion annually to prop up the regime of Syrian President Bashar al-Assad. According to some reports, spending has been as high as $15 billion in some years. Earlier this month, Iran’s President Hassan Rouhani vowed to rebuild war-torn Syria while citizens of his own country still lack adequate housing ten months after an earthquake hit the western Iranian city of Kermanshah. Slogans such as “Leave Syria alone, think about us” or “No to Gaza, no to Lebanon! I will give my life to Iran!” have become common on Iran’s streets and on social media.
External pressure has undoubtedly contributed to Iran’s economic meltdown, but Iranians are increasingly blaming their own leaders’ ideologically driven policies for their falling living standards and the poor state of the economy.”
It seems highly doubtful that the Iranian regime will be able to improve the country’s economic situation without addressing the concerns of Iranians. Nor does it seem likely that Trump will back down, or that the EU’s approach will bear fruit. This stalemate, combined with the mounting pressure of domestic dissatisfaction, makes for an unsustainable status quo, both for Iranian citizens and for the international arena.
Europe’s carrots and Trump’s sticks may dominate discussions about the Iranian state, yet the real drivers of change are not sitting in Washington or Brussels but are on the streets of Iran. Unless the regime finds a way to release the pressure and address the legitimate concerns of the Iranian people, wider and deeper unrest will be on the cards in the coming months.