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Iran’s Regime Thrives on Corruption, Though Not for Long

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An economic-oriented session in the governate of Hamedan province tagged “the Resistance Economy” and with the regime’s Minister of Economy attending- November 2017

In Iran, inequality has become the separating force between regime insiders and outcasts, where deep-seethed and systemic fraud burdens people to choose between an honest but poor life or a corrupt but lavish existence.

The state-run “Rokna” website reported on September 26, “In a troubling situation where 7,000 schools across the country lack basic amenities like drinking water and sanitary facilities, it has come to light that students from affluent families in Tehran are opting to order food from the upscale school menus for their daily lunch.”

The source added, “Rezamorad Sahraei, the Minister of Education, addressed Rokna’s inquiry regarding whether this practice aligns with the principle of educational justice, which is frequently discussed. Sahraei clarified that educational justice should not be conflated with these particular controversies. He emphasized that this issue is unrelated to the broader educational system and that the government does not oversee the food menus of private schools.”

The domination of the privileged class and the endemic corruption within their spheres have profoundly influenced the economic dynamics of the clerical regime over an extended period. To maintain control over the populace, high-ranking Iranian officials found it necessary to grant special advantages to their loyalists and fellow enforcers, thus giving rise to the elite and their associated corruption.

Once the Iran-Iraq was over, the clerical regime was faced with a fatal dilemma. Masses of devastated military and paramilitary forces came back from the fronts, wondering if all the warmongering and carnage was worth it and more so, why the country would need two parallel military institutions devouring a great deal of the budget amidst a post-war milieu.

At that juncture, then-president Ali-Akbar Hashemi Rafsanjani proposed the idea of integrating military forces into economic activities to “optimize their role and impact.” Concurrently, with the initiation of privatization policies, state assets were rapidly transferred to the elite and their progeny at significantly reduced prices. In a system where the people’s right to governance has been supplanted by the Supreme Leader, any misappropriation of the public’s economy tends to be viewed as legitimate and rationalized.

Systemic rent and corruption

The intricate web of connections and affiliations with state leaders facilitated the establishment of an extensive network comprising thousands of rent-seekers and corrupt individuals. Significant economic contracts were swiftly allocated to the elites and their descendants through a mere directive, phone call, or written communication. Simultaneously, various individuals, both natural and legal, were disadvantaged in competing due to the monopolistic control exerted by government officials, skewing the economic landscape.

Post-revolution, Iran amassed substantial oil revenue, exceeding 1.5 trillion dollars. Presently, with a population of 87 million, the country commands a GDP close to 450 billion dollars. Despite this significant income, nearly 50 million people live below the poverty line, with over 77 million receiving state subsidies. In stark contrast, less than one percent of the nation’s populace, including the privileged elite and offspring of state officials, have amassed colossal wealth surpassing what is typically attainable even in Europe and North America.

Numerous elites, such as former National Security Advisor Ali Shemakhani’s son, exploit sanctions by selling oil at remarkably low prices, resulting in daily revenues reaching into millions of dollars.

In March 2023, while trying to distance himself from a sinking ship, Mehdi Nassiri, the former editor-in-chief of Kayhan newspaper, referred to these elites, emphasizing, “For those who don’t witness the consequences, their lives remain untouched. The audacious offspring of your National Security Council, playing a central role in these affairs, stands as Iran’s foremost oil exporter, reaping a daily profit of one million dollars. What impediment do you and your elites encounter in this lucrative foreign policy?”

Richer than Iran

On July 6, 2108, Mahmoud Bahmani, the former head of the Central Bank, confessed that the wealth of the elites’ descendants exceeds the country’s foreign exchange reserves. In this interview, he stated: “For two years, the foreign exchange from our exports has returned to our country. Why do they announce today that the balance of our elites’ accounts in foreign banks is 148 billion dollars? Our country’s reserves are not this much. This means that the elites’ account balances abroad exceed our country’s foreign exchange reserves. What do these 5,000 elites outside the country do? It is said that 300 of them are studying. What about the rest?”

A significant share of these revenues funneled into the state treasury, is allocated towards domestic suppression and sponsoring terrorism abroad. Unfortunately, these funds do not contribute to the well-being of the populace; instead, they are used to perpetuate their suffering.

The formidable influence of the rent and corruption mafia within the nation has reached a level where it has effectively set aside the country’s constitution to serve its own agenda. An illustrative instance is the control exerted by the water mafia in manipulating both surface and underground water resources. Similarly, there’s the notorious mafia involved in university entrance exams and non-profit educational institutions, effectively abolishing the concept of free education.

The extent of corruption among the elites has escalated to a point where dissenting voices from within the regime are starting to surface. A member of the ruling clique candidly acknowledged the supremacy of corruption and the elite over the interests of the people in a tweet.

Hossein Naqashi, a member of the Central Council of the United National Party said, “In 2022, the number of millionaires in the world ‘except in France and Iran’ decreased/Iran ranks 14th in the world in terms of the number of millionaires/Iran has 246,000 millionaires!”

Lethal Corruption

According to the report by Transparency International, out of 180 countries, Iran ranks 147th in terms of economic and administrative corruption. The extent of this exploitation is so vast that in November 2017, former MP Ahmad Tavakoli warned that if the regime does not address the corruption problem, the state will collapse.

It is evident that this systemic corruption has led to worsening poverty for the populace and the erosion of their prospects. Iranians have keenly realized this reality over time: the only path to a hopeful future is the complete overthrow of the ruling regime.

The ongoing nationwide protests since 2022 showcase the people’s understanding that their survival is intricately linked to the riddance of the clerical dictatorship. Thus, a race has ensued, pitting the elites’ haste to embezzle and accumulate for their own security against a population becoming increasingly mobilized, knowledgeable, and resistant by each protest.