16.07.2015

Dependent on global hegemon

Yassamine Mather discusses the possibilities following the nuclear deal

After 18 days of negotiations, and 20 months after the initial talks regarding Iran’s nuclear programme started in New York, Iran and the P5+1 powers finally signed a deal on July 14.

Not everyone was happy. Israeli prime minister Binyamin Netanyahu had already declared that “some of the negotiating countries” (a clear reference to the Americans) were “willing to make a deal at any price”,¹ and afterwards he described it as “a mistake of historic dimensions”. His allies in the US Republican Party echoed these sentiments.

As details of the 159-page document became known, it was clear it was neither the “win-win” claimed by Iranian president Hassan Rowhani and his foreign minister, Mohammad Javad Zarif, nor the disaster that conservative Islamist opponents inside Iran said would result from any deal with the ‘Great Satan’. While Iran’s nuclear programme was not “heroic resistance”, as supporters of the regime claimed, giving up major aspects, it was not “heroic softening” either, as supreme leader Ali Khamenei had claimed earlier this year. The Financial Times summary is accurate: “Iran has accepted unprecedented international control and surveillance over its nuclear programme, as well as cuts in its uranium stocks and in the number of centrifuges.”²

At the end the day Iran’s neoliberal, dependent capitalist economy was brought to its knees by punitive sanctions imposed by successive US administrations. They had little to do with the country’s nuclear programme: they were about regime change from above. But for the time being that threat, along with the possibility of a military attack, is lifted - at least until the US presidential elections of 2017.

Rowhani, speaking immediately after the deal was signed, claimed Iran had actually won the right to pursue its nuclear programme and, strictly speaking, this is true: low-enriched uranium can now be used to produce fuel for nuclear-power plants.

In exchange, Iran’s Islamic republic has to remove or destroy two-thirds of its existing centrifuges, used for enriching uranium, as well as getting rid of 98% of its stockpile of enriched uranium, leaving just 300kg for the next 15 years. The heavy-water reactor in Arak will be converted, so that it cannot produce weapons-grade plutonium and Iran will not start building any new reactors for the next 15 years. It will be limited to installing no more than 5,060 of the oldest and least efficient centrifuges for 10 years. In fact the restrictions accepted by Iran are far more severe than any regulation stipulated by the Nuclear Non-Proliferation Treaty.

We are back to where we were 13 years ago, when the nuclear conflict started. However, in the meantime, Iran has spent billions buying dodgy nuclear equipment, often on the black market, while, as I have said, sanctions have destroyed its economy.

A compromise was reached over Khamenei’s ‘red line’: the inspection of the country’s military sites. Iran has agreed to allow United Nations inspectors to access any site they consider to be suspicious. However, Iran will be able to challenge such requests and a meeting with the P5+1 will make the final decision on its legitimacy. One could argue over to what extent this is a face-saving solution. After all, Khamenei had categorically stated: “I will not allow inspection of Iran’s military installations.”

However, sanctions (another of his ‘red lines’) will be removed at once, when the International Atomic Energy Agency confirms that its ‘Joint Comprehensive Plan of Action’ has been followed through, which the IAEA declared should be completed by the end of the year. Iran has accepted that if it violates the deal sanctions could be restored within 65 days.

While a UN arms embargo will remain in place for five years, this could end earlier if the IAEA is satisfied that Iran is pursuing an entirely peaceful nuclear programme. A UN ban on the import of ballistic missile technology could remain in place for up to eight years. Although by all accounts the Russians, keen to sell such missiles, were opposed to this, the Iranian delegation gave in.

‘Arrogant’

On July 11, as Iranians awaited the conclusion of the negotiations, ayatollah Khamenei addressed the issue of Iran’s relations with the US after the deal. Khamenei called the US the “ultimate embodiment of arrogance” and warned that Iran’s opposition to America would continue: “Get ready to continue combating the arrogant power.”

In fact Tehran’s pursuance of a neoliberal economic agenda has long since demonstrated that it has to succumb to the wishes of this “arrogant power” and the system over which it is the global hegemon. Iran is now one of the most unequal societies in the region, where “a new class of untouchable one-percenters hoards money, profiting from sanctions and influential relations, leaving Iran’s middle classes to face the full force of the country’s deepening economic woes”.³

This week news came of billions of dollars of personal wealth accumulated by ministers of the former president, Mahmoud Ahmadinejad, as a result of both privatisation and sanction busting. Ahmadinejad - Khamenei’s favourite president, the man who claimed to be the defender of the poor and the disinherited, who claimed he would stamp out corruption - was by all accounts heading one of the most corrupt governments of recent times. In June his vice-president, Hamid Baghaei, was charged with embezzlement, while in January, another of Ahmadinejad’s vice-presidents, Mohammad Reza Rahimi, was jailed for five years and ordered to pay 38.5 billion rials ($1.3 million) in connection with a money-laundering scheme worth billions of dollars.

But Khamenei’s reaction to the seemingly endless revelations of corruption, alongside the continued abject poverty for the majority, has been to call for such matters to be played down. According to him, there is no need to exaggerate things - think of the demoralisation that will cause!

In other words, our ‘third worldist’ supreme leader, who is presiding over one of the most unequal and corrupt capitalist countries anywhere in the world, where the neoliberal economic agenda imposed by the IMF, World Bank and indeed the US has created conditions of mass unemployment, ‘white contracts’ and wholesale privatisation, every now and then comes out with slogans about fighting US arrogance (he consciously avoids using the term ‘imperialism’ because of its Marxist connotations).

Our supreme leader’s politics are indeed frozen in the 1970s. He fails to acknowledge that, for all the slogans of the Islamic revolution about economic independence, full employment and a comfortable standard of living for all, by the end of the 20th century, things remained pretty desperate. Iran’s population more than doubled between 1980 and 2000 and its median age declined. Although many Iranians are farmers, agricultural production has consistently fallen since the 1960s. By the late 1990s, Iran imported much of its food. At that time, economic hardship in the countryside resulted in many people moving to the cities.

Iran might seem to be a regional power because of its influence in Lebanon, Syria, Bahrain and Yemen, but it is very much economically dependent on international capital. Conditions imposed by the IMF and the World Bank in exchange for loans made a mockery of claims of independence. Khamenei chooses to ignore the fact that, long before sanctions, Iran was totally dependent on the sale of oil.

Reforms

In February 2015, an inspection team from the International Monetary Fund visited Tehran. It was led by Martin Cerisola, assistant director for the Middle East and central Asia. In their discussions with Iranian authorities, the IMF team discussed developments in the Iranian economy, short-term programmes and the Rowhani government’s macroeconomic policies and reform agenda.

Cerisola’s statement at the end of this visit was typical of such inspections by IMF:

The discussions focused on the policies needed for preserving disinflation gains and for supporting the economy in its adjustment to lower oil prices. For this, the IMF team recommended that fiscal policy should aim at limiting the budget deficit in the next fiscal year to around 2.5% of GDP ... The discussions also focused on the need for pressing ahead with reforms and the authorities’ plans in the banking sector to address nonperforming loans and strengthen the efficiency of financial intermediation.⁴

We all know what IMF “reforms” have done so far - Khamenei does not need to look very hard to see signs of imperialist “arrogance”. However, as the negotiations progressed, foreign firms - in particular European-based transnationals - started queuing up to invest in Iran, with its cheap labour, stringent restrictions on workers’ rights and a workforce that has been disciplined by years of unemployment.

No wonder France, Germany and the United Kingdom were so keen to find a solution to the remaining points of contention. The German industrial group, BDI, is already trading with Iran to the tune of $2.4 billion, and it now hopes to increase this to $10 billion. According to Jean-Christophe Quémard, one of the directors of French car maker PSA Peugeot Citroën, plans are being discussed to resume car assembly in Iran (Peugeot had closed its plant in Tehran in 2012). Of course, this will mean jobs for hundreds of workers, but it will also yield major profits for the French car manufacturer.

And, according to the Wall Street Journal,

American firms have already been exploring the market potential. Apple Inc has been in touch with potential Iranian distributors … Boeing Co started selling aircraft manuals and charts to an Iranian airline last year, its first Iranian sales in more than three decades ...

General Electric Co already has limited exposure. Under the current sanctions’ humanitarian exemptions, the company distributes medical equipment like MRI machines and CT scanners in Iran … a spokeswoman said ... “We look forward to reviewing the details of the agreement reached and will watch the regulatory landscape that may unfold.”⁵

Someone should tell the supreme leader that Iran’s corrupt Islamic Republic is part and parcel of the capitalist order and its “world arrogance”, into which it will be now much more closely integrated.

What next?

For all the hysteria expressed by Israel and to a certain extent Saudi Arabia in opposition to the deal, it is very clear from statements by both president Barack Obama and Khamenei that the political situation in the region will not change dramatically.

The US is determined to support Turkish and Saudi efforts for regime change in Syria. The fact that arms embargoes remain in place for the foreseeable future show that, contrary to what Robert Fisk has written, the US has not changed track. According to Fisk,

Goodbye, therefore, to the overwhelming influence of the Sunni Muslim nations, which gave their sons to the 9/11 crimes against humanity and provided the world with Osama bin Laden, which supported the Taliban and then the Sunni Islamists of Iraq and Syria and - finally - goodbye to those emirs and princes who support Isis. Washington is sick and tired of the decrepit princes of the Gulf, their puritanical lectures, their tiresome wealth (unless it’s paying for US weaponry) and their grotty civil war in Yemen. Shia Iran is now the good guy on the block.⁶

Not true. The twin-track policy of containing Islamic State, while promoting failed states in Iraq and Syria, is now supplemented by a policy of controlling Iran. There will be no sanctions against the main backers of IS - Saudi Arabia, Qatar and the other Gulf states. On the contrary, arms sales to all these countries will continue and by all accounts the Saudi kingdom is seeking to develop its own nuclear programme. Let us hope that this aspect of Saudi military expenditure is not shared with IS.

What about the situation inside Iran following the deal? The Iranian people celebrated it in their thousands and there are reasons to do so. Hopefully the lifting of sanctions will mean better access to medication and essential supplies. The country will be able to import spare parts for production and for transport vehicles and undoubtedly this will save lives. The lifting of banking sanctions means Iranians can enter into personal and commercial international transactions and this has already seen an improvement in the rate of exchange for the rial, Iran’s currency.

Iranian students will be able to continue their studies outside the country, and there will be work for some of the millions of workers who have lost their jobs over the last few years, courtesy of the ‘targeted sanctions’. Those sanctions impoverished the majority of the population, while bringing windfalls of billions of dollars to the select few, including within the Islamic government. The regime will no longer be able to cite sanctions as its excuse for economic mismanagement, unemployment and poverty.

But do not expect improvements in democratic rights. On the contrary, having made the decision to reverse the nuclear programme for the sake of remaining in power, the regime (all its factions, ‘reformist’ and conservative) will remain opposed to basic political freedoms, and those fighting for the rights of workers, women and national/religious minorities will continue to face an uphill struggle. They will now find fewer allies and supporters outside Iran, as funds for regime change dry up.

Having said that, we in Hands off the People of Iran will continue to extend our principled solidarity to those struggling against oppression.

yassamine.mather@weeklyworker.co.uk

Notes

1. www.vox.com/2015/7/13/8947033/netanyahu-iran-deal-freakout.

2. www.ft.com/cms/s/0/f85107ba-2989-11e5-8613-e7aedbb7bdb7.html.

3. www.nytimes.com/2015/05/01/world/middleeast/in-iran-fatal-porsche-crash-unleashes-middle-class-anger-at-rich-elites.html?_r=0

4. www.imf.org/external/np/sec/pr/2015/pr1540.htm.

5. www.wsj.com/articles/western-companies-eye-iranian-markets-in-deal-s-wake-1436878433.

6. www.albawaba.com/news/did-america-just-change-sides-middle-easts-sectarian-war-719650.