Rouhani goes on offense against critics, shady interests and ‘culture of opacity’

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Article Summary
Iranian president presses ahead with anti-corruption agenda in response to political dissent and widening protests.

Iranian President Hassan Rouhani is not giving in to conservative and reformist critics in the wake of growing protests over the miserable state of Iran’s economy, instead intensifying his campaign against "shady interests" and a "culture of opacity."

Rouhani, in an explicit speech June 27, demonstrated his determination to resist and confront his opponents, calling for national unity in the face of rising external pressures. He then addressed conservatives and hard-liners indirectly, saying, "The administration will stand. Those who think that the government is scared and will resign, they are making a mistake," Rohollah Faghihi reports.

Bijan Khajehpour writes, “There are strong indications that the ongoing economic crisis in Iran is a direct consequence of domestic political shifts that are overlooked due to an overemphasis on external factors such as sanctions. As such, two interrelated domestic processes need to be understood: the pushback by some of the interest groups who feel that Rouhani’s post-nuclear deal reforms are undermining their interests, and the domestic competition over the future orientation of Iran’s international positioning.”

“A number of semi-state entities belonging to military, religious and revolutionary foundations represent a different layer of overlap between political and business interests,” Khajehpour continues. “While these groups have their clear interests, they need to operate in an economy in which the government remains a key player due to its monopoly on oil and gas revenues and its role as the main provider of hard currency. It is clear that in such an environment, the real private sector is overshadowed, and each of the mentioned interest groups — as well as the government — have carved out their own spheres to benefit from the country’s vast economic potential.”

Khajehpour adds, “Such a mode of operation is only possible as long as interests are distributed based on an opaque and informal political culture. That culture has thrived over the decades of external pressure and sanctions, and in many incidences, secrecy and opaqueness were even presented as legitimate and necessary instruments to beat and circumvent sanctions. At the same time, anyone who worked to increase transparency and accountability was sidelined through arrests and harassments. Consequently, major embezzlement cases were facilitated and even tolerated as part and parcel of a culture of opacity.” 

Khajehpour continues, “The Rouhani administration has continued to push for more transparency to expose shady interests. The most visible of such moves was the recent publication of the names of entities that had received foreign exchange at the official exchange rate to import mobile phones and the establishment of a committee to document the abuse of hard currency allocations by the Ministry of Information and Communication Technology. In addition, the Central Bank of Iran has published a long list of entities that have received hard currency at the official exchange rate. In one major corruption case that became public, officials at the Ministry of Industry, Mining and Trade have stated that the importation process of about 4,500 cars that had been imported illegally had been stopped.”

Rouhani believes he has at least the passive support of Supreme Leader Ayatollah Khamenei and has worked out a kind of quid pro quo with some conservative critics. “In the aftermath of the US withdrawal from the nuclear deal and its impending reimposition of sanctions on Iran, Rouhani has opted not to challenge conservatives on foreign policy and domestic issues, rather adopting a milder position toward his critics and opponents,” writes Abas Aslani. “At a conference of senior government managers on June 27, the president said that he is ‘ready to bow to the opposition and all critics and kiss their hands for unity and cooperation.’ His words were highly welcomed by conservatives. The managing editor of the conservative Kayhan, Hossein Shariatmadari, called the president's recently expressed positions ‘fortunate and auspicious,’ indicating that any insistence on the president’s resignation at a time when Iran needs unity the most and while Rouhani is cooperating with the broader establishment would be an unnecessary cost for the Islamic Republic.”

“As the United States works to eliminate Iran’s oil revenues, Tehran more than ever before needs engagement with its partners to thwart Washington’s efforts to politically and economically isolate it,” Aslani continues. “Rouhani, who has a long history of leading dialogue — including with Europe — can still be the right man for the job, at least in comparison with anti-West conservatives.”

Absent from the contest for power among Iran’s ruling elites are the Reformists. “Iran’s Reformists, staunch advocates against hard-liner dominance, are being further pushed to the brink by the United States,” writes Saeed Jalili. “Having lost all their tools to influence power, the Reformists teamed up with the centrist Rouhani in the 2013 and 2017 presidential elections. Moreover, in the 2016 parliamentary and 2017 city and village council elections, they pinned their hopes on new faces unknown to many. Although these measures succeeded in winning ballots, the performance of the 'new,' elected Reformists has been an additional cause of voter disappointment.”

The desperation of Reformists has been seen on display, even at times seeking common ground with conservatives to oppose Rouhani. “Given the ongoing economic and political crisis in Iran, conservatives and hard-liners have called for early elections and created such an atmosphere that even some Reformists have demanded that Rouhani resign, partly driven by a desire to save the face of Reformism among the public and avoid electoral losses,” Faghini says. “The fact that a number of Reformist figures and lawmakers support the conservatives and hard-liners' revived plan to summon the president to parliament and question him is proof of this. In remarks that indicate further distancing from Rouhani, Reformist Mohammad-Taghi Karroubi said June 24 that if the president doesn’t intend to confront the hard-liners, he should leave office.”

The Trump administration claims it is not pursuing regime change against Iran. “If the Trump administration is not publicly acknowledging that its ‘maximum pressure’ campaign is intended to lead to the collapse of the Iranian regime, it may be because it is having a hard time persuading wary allies of what its intentions are in the wake of Trump’s withdrawal from the Iran nuclear deal in May,” Laura Rozen reports.

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