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As the US dollar breached the staggering 100,000-toman mark in August 2025, the Iranian people were hit with another grim milestone: official statistics confirmed that year-on-year inflation had soared past 42%. For millions of households, these are not abstract figures; they represent erased life savings, empty dinner tables, and a future sacrificed at the altar of the regime’s ideological priorities.
This catastrophic economic decline is not an unforeseen tragedy but the direct outcome of a deliberate policy choice in Tehran. While ordinary citizens are crushed by a collapsing currency and hyperinflation, the regime continues to systematically plunder the nation’s wealth. Billions of dollars are diverted to enrich a corrupt elite and fund a sprawling network of foreign proxies, creating an explosive social environment where a restive population is being pushed to its breaking point.
The #Iranian Regime's Economic Warfare Creates a Multi-Front Crisis for the Peoplehttps://t.co/KoEgu32dxd
— NCRI-FAC (@iran_policy) July 9, 2025
The Anatomy of a Meltdown
The latest economic indicators, drawn from the regime’s own official sources, paint a bleak picture of an economy in freefall. On August 29, the dollar surged to above 103,000 tomans, a spike directly attributed to market fears over the activation of the nuclear deal’s “snapback mechanism” for sanctions.
Simultaneously, the Statistical Center of Iran released its report for the month of Mordad (ending August 22), confirming that the point-to-point inflation rate had reached 42.4%. The data revealed that households were forced to spend 42.4% more on the same basket of goods and services compared to the previous year. The most severe price hikes were in the “food, beverages, and tobacco” category, which saw a punishing 3.9% increase in a single month, further eroding the purchasing power of already struggling families.
The regime’s own insiders are aware of the impending disaster. A report from the Tehran Chamber of Commerce—which officials later attempted to deny after its public release—warned of a nightmare scenario should international sanctions be fully reimposed. Their forecast projected inflation skyrocketing to 90%, the dollar hitting 165,000 tomans, economic growth plunging to negative three percent, and the unemployment rate climbing to a devastating 14%.
#Iran's Economic Collapse Deepens as 80% Face Poverty, Blackouts Worsen, and Regime Braces for Unresthttps://t.co/X0aF4AqFgG
— NCRI-FAC (@iran_policy) August 25, 2025
A Case Study in State-Sponsored Plunder
The regime’s economic priorities are starkly illustrated by its handling of the agricultural sector. While claiming to address food security, its policies actively dismantle domestic production to benefit a corrupt few. According to the regime’s customs chief, Farud Asgari, in the first five months of the Iranian year (March-August 2025), the government authorized the import of 836,000 tons of rice, valued at $904 million, using “drought” as a pretext.
This flood of imports has been catastrophic for Iran’s own rice farmers, particularly in the northern provinces of Gilan and Mazandaran. Unable to compete with subsidized foreign rice, local producers have seen their products pile up in warehouses and their livelihoods destroyed. The policy is not about feeding the population; it is a textbook case of a rent-seeking scheme designed to enrich “mafia-like gangs.” These groups, often with deep connections to powerful institutions like the Islamic Revolutionary Guard Corps (IRGC), exploit their access to preferential currency rates to import goods cheaply and sell them on the domestic market at exorbitant prices, reaping massive profits at the expense of both farmers and consumers.
A Nation on the Brink: #Iran’s Economy Nears Total Breakdownhttps://t.co/vGWSKMuzub
— NCRI-FAC (@iran_policy) June 9, 2025
The Ideological Core of the Crisis: Proxies Before People
The source of this economic devastation lies in a political doctrine that consistently places its expansionist ideology above the welfare of the Iranian people. In a remarkably candid admission, the state-run Jahan-e Sanat newspaper recently framed the challenge for regime president Masoud Pezeshkian’s government as a choice between “the people and…” the regime’s network of foreign proxies.
The article acknowledged that with a staggering 800 trillion toman budget deficit, as cited by economist Ali Ghanbari, the state can no longer afford to fund both. The regime’s solution has been to cut subsidies for millions of families and impose a wide array of new taxes, effectively forcing the impoverished populace to finance groups like Hezbollah and Hamas.
However, the notion that Pezeshkian has any real say in this matter is a fallacy. Like his predecessors, he is merely a “functionary,” powerless to alter the regime’s strategic direction. The real authority rests with Supreme Leader Ali Khamenei and the IRGC. As economists within Iran have repeatedly pointed out, approximately 60% of the nation’s economy is controlled by four parastatal behemoths—Setad Ejraiye Farmane Emam (Headquarters for Executing the Order of the Imam), Bonyad Mostazafan (Foundation of the Oppressed), Astan Quds Razavi, and the IRGC’s Khatam al-Anbiya Construction Headquarters—all operating under Khamenei’s direct supervision. These entities function as a shadow government, siphoning off national wealth to fund the regime’s foreign legionaries, far from any public or governmental oversight.
The #Iran'ian Regime and Its Use of Proxies Across the #MiddleEasthttps://t.co/ZIS1YxQIOY pic.twitter.com/sWc7cAmbuq
— NCRI-FAC (@iran_policy) July 7, 2018
A Pressure Cooker Reaching its Limit
The convergence of a collapsing currency, crippling inflation, systemic corruption, and a clear policy of prioritizing foreign militias over its own citizens has created an untenable situation. The regime is not just mismanaging the economy; it is actively waging an economic war on its own people. By demonstrating such blatant disregard for their survival and dignity, Tehran is fueling the same rage that has ignited multiple nationwide uprisings in recent years. The question is no longer if the Iranian people will rise again, but when, as the regime’s calculated choices leave them with nothing left to lose.