In the first televised debate featuring Iran’s six presidential election candidates, Ebrahim Raeisi promised to triple subsidies going to the poorest Iranians and argued Iran had a rising Gini coefficient, a measure of income and wealth distribution.
Raeisi, a cleric who leads the vast foundation managing the Imam Reza shrine in Mashhad, hoped to present himself as a savvy technocrat as well as a humble man of the people.
Tehran Mayor Mohammad Bagher Ghalibaf likewise described himself as the candidate of the “96% against the 4%,” promising monthly cash handouts of 2.5 million rials — $77 — for any unemployed Iranian aged 18 or older.
Both Raeisi and Ghalibaf — the two main challengers to Iranian President Hassan Rohani from the principlist, or fundamentalist, camp — seek to tap into dissatisfaction at the limited bounce in the economy since international sanctions eased after Iran’s 2015 deal with US-led world powers limiting its nuclear programme.
Of course, Iran is not unique in having a gap between rich and poor. Earlier this year, a report from the World Economic Forum, collating views from 700 “experts,” identified rising inequality in income and wealth as the main factor — along with climate change — likely to shape the world in the next decade.
Widening disparities, the report argued, had not only fuelled populist politics such as the United Kingdom’s vote to leave the European Union and Donald Trump’s US presidential victory but also posed a risk to the world economic order.
Iranians’ attitude to wealth and inequality are shaped, firstly, by Iran’s possession of the world’s largest combined hydrocarbon reserves — 158 billion barrels of oil and 34 trillion cubic metres of natural gas. This gives them a strong sense they are living in an affluent country.
Secondly, the Islamic Republic took egalitarianism from Ayatollah Ruhollah Khomeini, leader of Iran’s 1979 revolution, who pitted the mostazafin (“dispossessed”) against the mostakberin (“oppressors”) and even the zagheh-neshinha (“slum-dwellers”) against the kakh-neshinha (“palace-dwellers”). Hence the republic has widened educational opportunities and improved rural development.
But this has encouraged politicians to pander to Iranians’ sense that wealth is somehow tainted, as seen in Raeisi calling himself a “mazloom.” “Being a mazloom, or victim, echoes Imam Khomeini’s words,” said Elham Gheytanchi, professor of sociology at Santa Monica College. “You can lead a revolutionary nation only if you are a victim yourself.”
In an Iran poll survey in April, 42% of respondents cited unemployment as the most important issue in the election, which is scheduled for May 19. Officially, Iran has 11% unemployment but many economists say it is higher.
“The main issue is the economy, specifically unemployment, and its management,” said Farideh Farhi of the University of Hawaii.
“International relations will factor with the charge against Rohani that he relies too much on foreign investment and isn’t doing enough for the ‘resistance economy.’ Regional turmoil and instability will also factor, with Rohani emphasising the need for continuity, stability and prudent diplomacy.”
The principlist camp has long criticised high salaries of technocrats close to Rohani’s government. Both Ghalibaf and Raeisi well remember Mahmoud Ahmadinejad’s 2005 presidential election victory on the slogan of “putting the oil wealth on the sofreh,” a reference to the mat that the poorer Iranians sit on to eat dinner.
Not that offering inducements to voters has been confined to the principlists. In the 2005 election, reformist Mehdi Karrubi promised a monthly cash handout of 500,000 rials — then about $77 — to all Iranians aged 15 or over. The political class scoffed but Karrubi came in third, ahead of the main reformist candidate who was promising social freedom and political reform.
Hence successive governments and parliaments have diverted energy revenues into popular short-term palliatives, like subsidising medicines and fuel, rather than into the productive investment that would produce sustainable long-term growth.
The unpalatable truth is that any Iranian president needs to make unpopular choices — deferring short-term gain for longer term prosperity — even if these are hard to present to voters.
Iranians may like the idea of the self-sufficient “resistance economy” beloved by supreme leader ayatollah Ali Khamenei but Iran needs foreign investment and imported technology to develop its energy reserves and provide the 8% economic growth that would provide jobs for record numbers entering the labour market.
Rohani has chosen this course and the Iranpoll suggests he has made headway, despite bellicose noises from the trump administration: Iranpoll found 55% of those asked said they thought Rohani was the candidate most likely to “improve foreign relations,” a percentage way ahead of his rivals.
But to win a second term, Rohani must communicate this message rather than just argue with other candidates over who would be the best manager or compete with them in making promises to the poor.
Rohani will lose if the election becomes a populist contest rallying slum-dwellers against palace-dwellers.
Gareth Smyth has covered Middle Eastern affairs for 20 years and was chief correspondent for The Financial Times in Iran.
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