In response to Rostam Pourzal's article on President Ahmadinejad, “Not that bad“:
I found your article well-written, and your analysis of Iran's economic prospects interesting. It aims at a sensitive topic and illustrates the difficulty of trying to balance criticism of the IRI with criticism of neocon/neoliberal forces. I am writing to respectfully disagree with some of your observations and conclusions and ask your opinions on issues you mention in your piece.
You mention free-market/IMF style economic reforms, but I don't think you articulate what exactly “IMF-style” reform is–privatization and deregulation are certainly not homogenous economic mechanisms — these reforms can vary wildly and take shape only by the strength of their regulatory frameworks, and the policy goals that drive them. What IMF-style reforms do you see happening in Iran?
Though I am no free-market champion, privatization can serve as a policy mechanism to stimulate an inert or underresourced public sector, and the resulting competing innovations can improve efficiency in allocating scarce public funding. It most certainly has its drawbacks, namely that of exacerbating economic divisions if it is without nuances and oversight.
I have studied privatization mainly from an educational perspective, and found one can argue for and against privatization using the criteria of freedom of choice, equity, efficiency, and social cohesion. In El Salvador, privatization of some public sectors resulted in higher enrollments in primary schools. Yet in Chile, the presence of for-profit private schools in a government voucher system has made Chilean public schools a dumping ground for the poorest and lowest achieving students.
All this to say, reforms themselves are nebulous ideas; the outcomes depend on how they are carried out, and it's too simplistic to link reform groups to “neo-liberals” on the basis that they have a different view of how to build the Iranian economy. It is easy to criticize privatization in a government that is transparent and accountable to its citizens, but that is not the kind of government found in Iran.
The strongest point of contention for me is the link you establish between Ahmadinejad's popularity and his proposed economic planning. Rafsanjani is no saint, and would probably stand to make even more money if free-market reforms were implemented . However, Ahmadinejad is no John Maynard Keynes either, and chances are he won't lift a finger against the numerous and Mafia-like bonyads that operate with government funds and without public oversight.
Iran's over-regulated economy prevents substantial outside investment because the current revenues allow the government to subsidize basic goods and petrol, perpetuating the status quo of Iran's economic production, stifling innovation, and allows the IRI's corrupt politicians to come out looking like they have the interests of the people at heart. It makes more sense for the government to preside over a mediocre economy and subsidize its citizens than for it to lose control and relevance if the economy does well without it.
I also feel you do some image-repairing for Ahmadinejad. It's genius to claim to be a populist while pocketing untold billions of dollars that rightly belong to the Iranian public. Ahmadinejad's unfortunate victory is the latest symbol of Iranians' knee-jerk resistance to their oppressive government, and is devoid of legitimacy to the 45% of the eligible voting population that did not partake in the elections. Why reinvent an obedient regime soldier as a populist hero battling neo-liberal forces?
More importantly, Iran's distorted social welfare system strengthens the dependency of the Iranian people on the government to provide for its needs, creating a relationship that is rooted in patronage and a cementing “handout” culture. In other words, these programs are void of equality and human dignity, essentially buying Iranians' social and political freedoms in exchange for cheap gas and rice.
Still, I think you wrote an interesting article and I hope to see more discussion on this topic in the future.
