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Economic Ills Fuel Iranian Dissent
By By Afshin Molavi
Jul 8, 2003, 4:48am

Struggling Workers Find Solidarity With Protesting Students

TEHRAN -- Thin streaks of sweat dripped down Ali's gaunt, sun-baked face as he sat behind the wheel of his car amid Tehran's chaotic afternoon traffic. The 53-year-old army technician tapped his horn repeatedly as he dodged oncoming cars, motorbikes and pedestrians.

"Traffic is awful," he said, downshifting past a pedestrian as a motorbike sped by within inches of his battered, wheezing yellow car. "By the time I get home, my nerves are frayed. It's really terrible."

Still, Ali will spend the next six hours on the road at his second job: taxi driver. With rampant inflation, stagnant wages and an anemic economy, many Iranians hold second and even third jobs simply to survive. One taxi agency boasts three university professors on its part-time staff.

"Our economy is a mess," said Ali, who declined to be identified by his full name. "The prices of meat, housing, cars, everything, is overwhelming. I have given 27 years of my life to serving the army, and I am reduced to misery. I barely eat meat once a week, but our government officials are eating the finest kebabs day and night. This is outrageous."

From working-class neighborhoods to affluent suburbs, millions of disenchanted Iranians like Ali are becoming increasing vocal about their frustration with the price of meat, the lack of jobs and widely perceived government corruption. In expressing hopes for a better economic future, and anger at what they view as government mismanagement and corruption, they have found themselves in league with younger student activists calling for greater freedoms and secular democracy. Last month, roughly 10,000 protesters, a mixture of university students and local residents, took to the streets of Tehran and other Iranian cities.

Ali says he played a small role in the protests, joining a group of drivers who purposely clogged streets around Tehran University and honked their horns for hours in solidarity with the younger demonstrators. He is prepared to do so again, he says, if students defy an official protest ban on Wednesday, the anniversary of nationwide student protests that rocked the country in 1999, leaving at least five students dead and hundreds in jail.

"Our government needs to know how upset we are," he said. "They cannot simply live like kings while we live in poverty. Before the revolution, I ate meat every day. Today, I eat it only once a week."

Ayatollah Ruhollah Khomeini, who lived a modest life in a humble home, once said that Iran's 1979 Islamic revolution "was not about the price of watermelons."

But today watermelons cost roughly seven times more in real terms than they did before Iranians toppled the U.S.-backed monarchy of Shah Mohammad Reza Pahlavi and put Khomeini at the head of a theocratic state. Iranians' consumption of bread, meat, rice and tea is down as much as 30 percent compared with before the revolution, according to the country's central bank, and in real terms, Iranians earn one-fourth of what they did then.

Official statistics put 15 percent of the population below the poverty line, though some economists put the actual figure closer to 40 percent. Over the last three years, inflation has averaged 15 percent. Unemployment is officially 13 percent, but independent economists say the rate is more like 25 percent.

According to the International Monetary Fund, Iran has the highest rate of brain drain in the world -- 160,000 of the country's best and brightest emigrated last year -- and with two-thirds of the country's 66 million people under age 30, the government estimates that nearly 1 million jobs must be created each year to stanch the flow of emigration.

Such statistics would likely stir passions in any country. But frustration is particularly acute in Iran, where economic expectations rose along with oil prices in 1973 and Khomeini's populist speeches included promises that government officials would personally distribute oil income checks to the masses and elevate the downtrodden. Despite possessing the world's second-largest gas reserves and third-largest oil reserves, the government has been unable to fashion a sustainable, job-creating, globalized, efficient economy, Iranian economists lament.

Officials have shown signs that they comprehend the level of popular discontent. Ayatollah Ali Khamenei, Khomeini's successor as Iran's supreme leader, recently made a rare call for increased foreign investment and said: "Dispensing economic justice has been one of the regime's most cherished yet unrealized goals since its establishment nearly a quarter-century ago."

New foreign investment laws, the introduction of private banking to compete with plodding state-owned banks, and measures to boost private enterprise have all been offered recently by the government as remedies for Iran's economic ills.

Still, many economists dismiss the initiatives as insufficient. "The entire structure of the economy needs to be overhauled," says Ali Rashidi, a Tehran-based economist and newly elected member of Iran's national Chamber of Commerce. "These small measures are like putting a Band-Aid on a cancer patient."

Rashidi said he believes control of the economy must be taken from the government's hands. About 70 percent of the nation's gross domestic product is controlled by inefficient government entities, Rashidi estimated, citing bonyads -- tax-exempt charitable foundations and business conglomerates -- as a key impediment to sustainable private-sector growth.

President Mohammad Khatami, whose once-popular reform agenda has been thwarted by conservatives in Iran's government, repeatedly has called for more accountability from the bonyads. Reformist lawmakers, economists and journalists publicly criticize government-affiliated "economic mafias" that distort the economy for private gain, using access to import licenses and cheap credit to create monopolies in such items as sugar, tea and cars.

Rumors of senior officials with Swiss bank accounts, villas in Europe and Canada and shady financial dealings appear to be a mixture of exaggeration and truth. But taxi drivers often point out the palatial homes of senior officials, some of whom are Muslim clerics who once lambasted the shah's wealthy elite for its profligacy. After passing one such clerical palace, a driver deadpanned: "I guess those modest government salaries have been raised recently."

As economic discontent grows -- manifested in occasional bouts of labor unrest, including strikes -- analysts say it poses no threat to the government. Still, officials take the stirrings seriously, canceling all official activities on May Day -- Labor Day in much of the world -- for fear of strikes.

Ali Jafarzadeh, a reformist member of parliament from the northeastern city of Mashad and an advocate of economic liberalization, said in an interview: "Unless we improve the economy, we are headed toward a social crisis."

Meanwhile, as Ali picks up passengers late into the night, he queries a Tehran University student. "When are you protesting again?" he asks. "I'm ready to honk my horn."

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