Cabinet of the Islamic Republic of Iran Topic I: The Situation in Syria and Iraq

Cabinet of the Islamic Republic of Iran Topic I: The Situation in Syria and Iraq Topic Overview: Since 2011, our neighbors to the West have been in chaos. With the start of the Civil War in Syria and the rise of the Islamic State both there and in Iraq, we have a responsibility, an opportunity, to assist our neighbors. We must work for peace, of course. The war torn areas in Syria and Iraq do not bode well for our border security and success of regional operations. But the current predicament to the West provides us with a unique landscape to export our glorious revolution. However, the United States has also seen this as an opportunity to encroach on our borders and influence even more than they already have through their Western ideals and culture, and now with their coalition of Western, Saudi, and Turkish military power. We must work closely with our strategic ally in Syria, Bashar al Assad, to assure we maintain a regional ally, and with Russia, who could prove useful in countering US involvement that is hindering our efforts. Make no mistake, the wars in Syria and Iraq are a dangerous game, one in which men will die and alliances will be forged and destroyed. Nevertheless, it is a game we must play one we must win through a strategy of tactical diplomacy, military might, and the planting of the seeds of our revolution to our West. Historical Background: Syria When the Arab Spring movement swept across the Middle East in early 2011, many of our neighbors were not prepared. We however, were able to stamp out the small sparks of dissidence before it became a problem for us. Widespread arrests were ordered on our part. Troublesome students and political activists were silenced, as well as dissident lawyers,

journalists, and NGOs reined in. We applied stricter regulations and monitoring on internet cafe 1 users and also placed opposition leaders like Mir Hossein Mousavi under house arrest. While our hold on our nation remained, our ally in Syria was not so fortunate. The protests in Syria got out of hand extremely quickly. President Bashar al Assad deployed military units to crackdown on the protestors in May of 2011 with most forces concentrated in the cities of Homs, Daraa, and Damascus where there were the most prominent demonstrations. Following this, the US of course used the unrest as an opportunity to grandstand in front of the world and place stricter 2 sanctions on a nation in crisis. Needing to assure the power in Syria remained with our ally President al Assad, we shipped the Syrian government riot control gear and internet surveillance 3 technology along with training their police and military in protest control. Nevertheless, the protestors proved to be more determined, more bent on chaos than both us or President al Assad expected. As the military in Syria continued to crack down on protests in attempt to save the nation from delving into chaos. Hundreds were killed in Hama in July of 2011 followed by calls from the US for President al Assad to step down and their allies in the Arab League abandoning 4 them. To assist in quelling the growing violence, we sent in our allies, Hezbollah, and deployed our members of our Islamic Revolutionary Guard Corps Qods Force (IRGC QF) in an advisory capacity. Eventually, after months of increasing violence, thousands of deaths, and increased foreign presence, we began to increase the number of our advisors, Hezbollah forces, in additional to persuading Shiite militias from Iraq, Afghanistan, and Pakistan to enter the fight on 1 https://www.amnesty.org/en/latest/news/2012/02/iran new report finds surge repression dissent / 2 https://www.washingtonpost.com/apps/g/page/world/timeline unrest in syria/207/ 3 http://www.washingtoninstitute.org/policy analysis/view/iranian casualties in syria and the stra tegic logic of intervention 4 https://www.washingtonpost.com/apps/g/page/world/timeline unrest in syria/207/

the side of President al Assad. The US and their allies, like Turkey and Saudi Arabia immediately seized the opportunity to begin arming and financially supporting those trying to overthrow President al Assad. As we move forward to evaluate the current state of affairs in Syria, we must remember how quickly they moved when they smelled the blood of a rival and saw the chance to counter our regional influence. Iraq The rise of the Islamic State within Iraq has proved very troublesome for our efforts in exporting our revolution to our Western neighbor and assuring our own influence in the regional gains superiority. The Islamic State has given much trouble to be certain, let us say, useful factions, within Iraq that have been of help to us in the past. With the Iraqi government being a long time enemy of our revolution and also being much too close to the US government, our primary aid has gone to Syria. That being said, we have not decided to stand by while our Western border devolves into terror. Beginning in 2014, our government has supplied the Iraqi military with intel, weapons, and military advisors, along with Hezbollah fighters and other Shiite militia s that we support in order to be better equipped to counter the threat posed by the Islamic State. Major General Qassem Suleimani proved his worth in leading the IRGC QF in liberating the Iraqi city of Amerli. Our soldiers fought gloriously in this battle alongside Shiite 5 militias and the Iraqi military along with US air support for the Iraqi military and our operations. Make no mistake, the US and Iraq are not our allies, and it should never be publicly spoken that we assisted each other's efforts in battle. But within this cabinet, looking at our current options in Iraq, it must be recognized that, at least for a short period of time, this country, the US, and Iraq 5 http://foreignpolicy.com/2014/09/10/tehrans boots on the ground/

do have some shared goals inside of Iraq. As you all know, the following months, the following years, have proved to be the most volatile that ts region, this nation, has faced in decades. With that, we move to discuss our next moves in Syria and Iraq. Current Situation: Syria Our primary concern at this time must be securing an ally in Syria for the long run. This means that our end goal in Syria is to assure that President Bashar al Assad retains his power. As already mentioned, we are not alone in this fight. Our allied militias have taken up large parts of the fight and support from Russia has proved pivotal. During the summer of last year, when the Russian military began operations to help our mutual ally, we increased our military forces within Syria to around 3,000 troops. As of now, after a troop draw down, our current numbers in Syria are at 700 troops. Other allied troops currently operating in Syria include between 4,000 and 5,000 Hezbollah fighters and various numbers of other Shiite militia personnel. Casualties have been higher than expected. During our troop surge last year between November and this 6 February, 160 troops were killed and 300 wounded. We must not rely solely on military tactics as the cost of war has proven to be great. With the on and off peace talks going on in Geneva, we may have an opportunity to get our goals achieved while sparing the lives of our soldiers. Of course, these talks have not been productive to a large extent, but they have shown promise. The US has already agreed to consider that President al Assad will have some form of important role 6 http://www.washingtoninstitute.org/policy analysis/view/iranian casualties in syria and the stra tegic logic of intervention

7 in whatever the political situation in Syria after the terrorists are war. We must work with Russia in any way possible to increase our power in these talks. Iraq While the situation in Iraq may take a back seat to Syria in terms of our geopolitical interests, it has nonetheless grown to be a grave threat to our immediate security and long term goals in the region. The Islamic State and their Sunni Islam is destroying any evidence of past success in exporting our revolution to Iraq. Enforcing their own brand of Islamic law wherever they travel, destroying sacred sites, and massacring our Shiite allies, the Islamic State is a top security risk that must be dealt with. As was discussed earlier, this enemy, in both Iraq and Syria alike, has proven to unite the world against it. Therefore, we can expect to work with the US and Iraq to some extent, but never openly and never in a way that would allow them to have Iraq in their image any more than it already is. In addition to the liberation of Amerli, our forces and militias, again under the command of Major General Qassem Suleimani retook Tikrit from the Islamic State in late March of last year. However, this time, the US, to no surprise, did not assist our forces and also raised concerns over Shiite militias fighting to liberate the innocent people in 8 Tikrit. Going forward we should not expect help from the US but be able to sit down and talk, very quietly, with them if necessary. Another area of concern when dealing with Iraq is our border security. While we have yet to have any major issues with the Islamic State on our soil, our border is still very weak in some places. General Mohammad Pakpour, the commander of the Islamic Revolutionary Guard Corps (IRGC) ground forces, has reported that our three major 7 http://foreignpolicy.com/2016/02/01/the united states botched the syria talks before they evenbegan/ 8 http://foreignpolicy.com/2015/03/05/for god and country and iran/

bordering neighbors, Iraq, Afghanistan, and Pakistan, have little to no border presence and 9 security and that certain terrorist group thrive in these areas. Going forward, our border security, specifically with Iraq, should be discussed. Below is a map of current areas controlled by different factions in Northern Syria, and then a map displaying the Islamic State s territory in 10, 11 order for you all to better visualize just a part of what is happening in our region. Bloc Positions: The United States The US is opposed to us in nearly every area of both conflicts with the sole exception that we both agree that the Islamic State is a grave threat to the world and a destabilizing force in the region. In Syria, they are against President al Assad and are also funding and arming rebel groups that have battled us or our allies directly. In Iraq, they continue to focus on bombing missions and special operation against the Islamic State. We must be concerned with the influence they are gaining there now in the long run. We must do everything in our power to work toward peace as well as export our revolution and secure regional allies. US involvement in most capacities generally is counter to that goal. The Russian Federation The Russian Federation is the only state partner we have in these conflicts currently beside President al Assad and his war torn country. We have worked closely with Russia through this conflict as well as on the Joint Comprehensive Plan of Action nuclear agreement. We must 9 http://www.al monitor.com/pulse/originals/2016/02/iran borders afghanistan pakistan iraq terro r.html 10 http://www.edmaps.com/html/syrian_civil_war_in_maps.html 11 http://www.understandingwar.org/backgrounder/isis sanctuary map august 19 2016

utilize them in any way we can to assure our place as a contending power in the Middle East is preserved when all of this is over. The Republic of Turkey The Republic of Turkey, after an attempted coup there earlier this year, has begun to seek closer relations with us, and us with them. A collapse of a government to our North would prove to be a very problematic situation. While they are a Sunni Islamic state, we share the common goal of reining in the chaotic violence in the region. In addition, with closer relations with Turkey, we could potentially cause the Saudi s to falter in their attempts to build a unified Sunni alliance in the region. 12 This would also lead us to indirectly limiting US coalition building efforts in the region for this conflict and future ones as well. However, if we seek to build alliance with Turkey, we must also evaluate our stance on the Kurdish people and fighters who Turkey is at war with. Discussion Questions : 1. How flexible can we be on what is in store for Syria after the war? Will al Assad stay on as president no strings attached, or will he simply be a part of a reform process? 2. How many troops are we willing to sacrifice for the cause of saving al Assad s Syria and also Iraq? Are military operations even the best option over skillful diplomacy? Is there a balance between the two that we can find quickly that would still achieve our long term goals? 3. How can we leverage Russia into committing more military power and strong diplomacy against US backed groups and interests in both Syria and Russia? 12 http://www.inss.org.il/index.aspx?id=4538&articleid=12141

4. How can we reevaluate our use and support of militia groups and Hezbollah to both increase our military force but also persuade the West to negotiate despite our use of these groups? Resources: http://www.washingtoninstitute.org/policy analysis/view/iranian casualties in syria and th e strategic logic of intervention http://foreignpolicy.com/2014/09/10/tehrans boots on the ground/ http://www.understandingwar.org/backgrounder/isis sanctuary map august 19 2016 http://foreignpolicy.com/2016/02/01/the united states botched the syria talks before theyeven began/ https://www.amnesty.org/en/latest/news/2012/02/iran new report finds surge repression d issent/ https://www.washingtonpost.com/apps/g/page/world/timeline unrest in syria/207/ http://www.al monitor.com/pulse/originals/2016/02/iran borders afghanistan pakistan iraq terror.html http://foreignpolicy.com/2015/03/05/for god and country and iran/ http://www.inss.org.il/index.aspx?id=4538 http://www.edmaps.com/html/syrian_civil_war_in_maps.html

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Cabinet of the Islamic Republic of Iran Topic II: Economic Growth and Re integration into the Global Economy Topic Overview: For decades, the Islamic Republic of Iran has had to struggle with the challenges of international scrutiny and, more importantly, economic sanctions. Many of the Western powers in the international community, especially the United States, have imposed aggressive sanctions and other exclusionary measures on Iran since 1979. While the sanctions started off as a ban on oil imported from Iran and similar measures, they eventually expanded into much stronger measures such as an embargo and the freezing of assets abroad. 13 Over time, the sanctions against Iran became more aggressive as well as more unilateral. By the 1990s, the United States was a leader in anti Iran sanctions. These excessively aggressive sanctions were designed to isolate Iran from the international community as much as possible, and in that regard they were quite successful. However, in recent years, experts have begun to see Iran and the sanctions against the state differently. Many of the issues associated with sanctions came up only a few years ago when United Nations officials acknowledged the fact that sanctions against Iran not only have a significant impact on the people of Iran, but they also hinder humanitarian efforts within the country. 14 Among other things, the excessive sanctions against Iran have led to extreme inflation in recent years as well as a significant increase in the prices of commodities, utilities, food, and even medicine. These problems were further compounded by shortages, especially medicine 13 http://iranprimer.usip.org/resource/us sanctions 14 http://www.reuters.com/article/us iran sanctions un idusbre89412z20121005

shortages due to a lack of countries willing to export to Iran. Although attitudes towards sanctions have shifted slightly, the demonization of Iran in Western media has not changed. Most of this scrutiny and general disdain has surrounded Iran s nuclear program and accusations that the program is for developing nuclear weapons. Negotiations with the P5+1 states; which include the United States, the United Kingdom, France, Germany, China, and Russia, occurred for about 10 years with varying success as the Western powers would not propose reasonable terms. During this time, especially when negotiations failed, the Western media pinned the blame on Iranian negotiators. Tensions flared when Israel joined the conversation by suggesting that Israel may have to use military force against Iran if they did not cease their nuclear program. 15 These factors have perpetuated an unwarranted disdain of Iran in the international community. In short, Iran has had to struggle with many issues due to its forced isolation. Iran s relations with the international community have been adversarial in the past, but Iran has been able to re enter the global economy thanks to an agreement on sanctions relief. Thanks to the agreement, assets will be unfrozen, the oil embargo in Europe will be lifted, and other sanctions will be lightened. 16 This is a great opportunity for Iran to invest in the country and undo the damage that was done by decades of oppressive sanctions. With some of the major barriers to economic growth lifted, Iran can finally be able to address issues of inflation and unemployment more efficiently and effectively. However, while the recent deal with the West is an integral aspect of Iran s re integration into the global economy, the situation is not perfect. Inflation and unemployment have both been alarmingly high for some time now. Thus, these issues will not be easily solved without a concrete plan. Moreover, while Iran is now able to 15 (see 14) 16 http://www.aljazeera.com/news/2016/01/iran rejoins world economy sanctions lifted 160117132734049.html

export oil to more markets than before, oil prices have not been in our favor. While experts are projecting a mild recovery in the coming months, dramatic improvement is required to sustain economic growth. If Iran is to succeed in the global economy, then it must work to not only adapt to the dynamics of the global economy, but it also must ensure the survival of the deal brokered with the P5 states. While the accords were agreed upon, in the United States there is talk of re negotiating the arrangements. This conversation has been a topic that was brought up on multiple occasions during the United States presidential election, and that should be concerning for Iran. While the rhetoric of anti Iran individuals has been relaxed over recent months, some experts claim that there is still a possibility that Congress could revisit the deal and try to renegotiate. 17 Iran should be concerned by this trend and make great efforts to ensure that the other parties to the agreement. These measures must be taken while Iran works to maintain consistent growth of its economy in order to be a respected player in the global economy. Historical Background: In order to understand the importance of Iran s re integration into the global economy, one must study the history of sanctions against Iran from the United States and other entities. Given the United States influence on other Western powers, the history of their sanctions must be understood. The first sanctions imposed on Iran by the United States were approved by President Jimmy Carter s administration in 1979. 18 These sanctions were due to the takeover of the United States Embassy in the months after the revolution. The sanctions began with a ban on all Iranian oil imports and the freezing of $12 billion worth of Iranian assets in the United States. 17 http://thehill.com/blogs/ballot box/presidential races/286453 adviser trump not going to get rid of iran deal 18 http://iranprimer.usip.org/resource/us sanctions

Later, the sanctions would include a trade embargo and a travel ban. 19 These sanctions were later lifted by a provision of the Algiers Declaration in 1981, which was negotiated to resolve the hostage crisis faced from the takeover of the American Embassy. Although the sanctions were lifted in 1981, $5 billion worth of frozen assets were used to repay debts to United States banks 20 and another $1.1 billion was put into escrow to settle claims by the United States against Iran. The Declaration also established the Iran United States Claim Tribunal, which was used to hear claims by either the United States or Iran. This tribunal still exists today. Similar sanctions were imposed during the 1980s as well. After a bombing of United States Marine Peacekeepers in Lebanon, the United States opposed giving World Bank loans to Iran. Later, the administration would also restrict exports of items that could be repurposed for military use to Iran. 21 This eventually led to a ban on import from Iran altogether. The sanctions of the Reagan administration were the foundation for other sanctions in the 1990s, including a ban on United States companies from participating in Iranian petroleum development and a complete trade investment embargo. After this period, the Bush administration made the sanctions even more aggressive in two ways: by expanding sanctions and by increasing enforcement. After 2005, the United States froze the assets of individuals and firms that were suspected of supporting Iran s alleged terrorism or the nuclear program. This was coupled with the Iran, North Korea, and Syria Nonproliferation Act., which expanded the president s authority to impose and enforce sanctions. 22 The 2000s mark the period in which the United States started actively and aggressively 19 (see 18) 20 (see 18) 21 (see 18) 22 (see 18)

pursuing sanctions against Iran. Over the past few decades, the United States has been a leader in sanctions against Iran and has focused on unilateral action to isolate Iran from the rest of the world. Finally, there are the sanctions from the late 2000 s that are pertinent to the Joint Plan of Action, which is a major facet of Iran s re integration. The primary sanctions are from the United States, the European Union, and the United Nations. Before the Joint Plan of Action, the United States had sanctions that prevented financial institutions that dealt with sanctioned banks from working with American institutions and prohibited them from conducting business with the U.S. dollar. Most of the financial sanctions are outlined in the 2011 Comprehensive Iran Sanctions, Accountability, and Divestment Act (CISADA). 23 CISADA also had provisions for preventing oil exports as the United States prioritized curbing Iran s oil revenue. Among other things, the American sanctions included a much stricter trade embargo, widespread use of freezing assets 24 and travel bans, and sanctions for private individuals who supported Iran s weapons programs. The United Nations also had sanctions imposed on Iran. The U.N. focused its sanctions on limiting Iran s nuclear program as the IAEA declared Iran noncompliant with safeguards back in 2005. 25 The U.N. sanctions included an embargo on materials used for uranium enrichment, blocking non humanitarian financial assistance to Iran, and sanctions for financial institutions. While the United States sanctions were much imposed with the explicit goal of isolating Iran, economic isolation was not the chief goal of the U.N. sanctions unless it was related to oil sales or Iran s nuclear program. 23 http://www.cfr.org/iran/international sanctions iran/p20258 24 (see 23) 25 (see 23)

Finally, the European Union s (EU) sanctions are enhanced versions of the U.N. sanctions but are nearly as extensive as those of the United States. 26 The EU s sanctions regime was made similar to the United States over time as it included the freezing of assets for individuals and entities supporting the nuclear program, restrictions for financial institutions, and an oil import ban. Current Situation: Iran s re integration into the global economy hinges on the Joint Comprehensive Plan of Action (JCPOA), which is sometimes colloquially referred to in the West as the Iran Deal. The JCPOA is an agreement that states that sanctions will be lifted under the condition that Iran s nuclear program stays peaceful. 27 This the verification is conducted by the IAEA and Iran was deemed compliant in January 2016. 28 However, if Iran is found to be noncompliant in the future, sanctions can be imposed within sixty five days by the U.N. by majority vote. 29 In short, Iran can expect sanctions to be lifted over the coming years so long as the IAEA keeps finding the country to be compliant with JCPOA. It is also important that Iran ensures that the other parties to the agreement do not attempt to renegotiate. So long as JCPOA remains in place, Iran can continue to capitalize on re integration. However, that is only half of the challenge for Iran. If Iran is going to be successful in the global economy, it must work to maintain economic growth in the post sanction environment. Given the fact that Iran s Gross Domestic Product (GDP) grew 1.4 percent between 2012 and 2014, there is hope for establishing growth in Iran. 30 That being said, the growth that Iran has 26 (see 23) 27 http://www.state.gov/e/eb/tfs/spi/iran/jcpoa/ 28 http://www.state.gov/e/eb/rls/othr/2016/251284.htm 29 (see 23) 30 https://www.foreignaffairs.com/articles/iran/2015 11 22/rebooting irans economy

experienced thus far is not offsetting the woes of unemployment, especially among Iran s young people, and inflation. These challenges are made even more difficult by the low oil prices that have characterized the market over the past year. It has become clear that, at this point in time, 31 an increase in oil production could help Iran in the short run, but the growth is unsustainable. Iran s economy is also burdened by excessive subsidies, low interest rates, and nonperforming loans. President Rouhani has worked to liberalize the economy since he came into power, and he has been mildly effective. 32 However, the Rouhani administration must also account for the interest of hardliners and fundamentalists among Iran s elite. Some of Iran s economic problems can be attributed to its current economic system, so reform is necessary to maintain growth. However, the main debate is the degree of these reforms are enacted. Iran can make mild reforms in the form of relieving some of the pressures that private industries face, but these reforms will not directly address the roots of Iran s economic challenges. 33 On the other hand, more coordinated and widespread reforms run the risk of angering hardliners in the political elite, which could jeopardize all reforms. In order to maintain growth, the Iranian cabinet must navigate the line between economic reform and satisfying its internal stakeholders, and that may be easier said than done. Discussion Questions: 1. Given the fragility of the JCPOA, how can the Iranian cabinet protect the agreement? 2. If the JCPOA is ever put into jeopardy, is there a contingency plan for Iran to continue to re integrate into the global economy? 31 http://www.mei.edu/content/irans post sanctions economic options 32 (see xix) 33 (see xix)

3. How can Rouhani s administration address the needs of hardliners without compromising the progress that has already been made in Iran? Resources: http://iranprimer.usip.org/resource/us sanctions http://www.reuters.com/article/us iran sanctions un idusbre89412z20121005 http://www.aljazeera.com/news/2016/01/iran rejoins world economy sanctions lifted 16 0117132734049.html http://iranprimer.usip.org/resource/us sanctions http://thehill.com/blogs/ballot box/presidential races/286453 adviser trump not going toget rid of iran deal http://www.cfr.org/iran/international sanctions iran/p20258 http://www.state.gov/e/eb/tfs/spi/iran/jcpoa/ http://www.state.gov/e/eb/rls/othr/2016/251284.htm https://www.foreignaffairs.com/articles/iran/2015 11 22/rebooting irans economy http://www.mei.edu/content/irans post sanctions economic options

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Cabinet of the Islamic Republic of Iran Topic III: Special Topics in Domestic Affairs Topic Overview: Over the past couple of years, Iran s chief focus has been trying to re integrate into the global economy by having the sanctions against the state uplifted. The aggressive sanctions imposed on Iran were designed to not only cripple the economy but also isolate Iran from the rest of the world. Naturally, these sanctions were effective at hindering Iran s effort to be a global player. However, the sanctions were also quite successful at deteriorating the state of domestic affairs in Iran. Not only did these sanctions block foreign investment in Iran, but they also led to extremely high inflation and also prevented Iran from earning reliable income through oil exports. 34 As a result, Iran s economy struggled and a slew of other domestic issues came about as well. Between the increasing prices of food, medical supplies, medicine, and utilities, Iran was facing a humanitarian crisis. 35 The resulting crisis could not even be properly addressed because of the sanctions that were in place. In fact, the sanctions negatively affected various humanitarian efforts in the country. 36 All in all, these are just some of the domestic problems that Iran has been facing due to aggressive sanctions. The sanctions imposed by the United States, European Union, and United Nations were only recently uplifted. The uplifting of sanctions imposed on Iran was due to the negotiation of the Joint Comprehensive Plan of Action (JCPOA), which was agreed upon by Iran and the P5+1 states. Thanks to the agreement, assets will be unfrozen, the oil embargo in Europe will be lifted, and other sanctions will be lightened. 37 The final agreement requires Iran to halt its nuclear 34 https://www.stratfor.com/analysis/iran economic reforms hit hard line 35 http://www.reuters.com/article/us iran sanctions un idusbre89412z20121005 36 (see 35) 37 http://www.aljazeera.com/news/2016/01/iran rejoins world economy sanctions lifted 160117132734049.html

program and stop uranium enrichment. Although the nuclear program was used for civilian purposes, Iran agreed to the terms. It is important to note that some other sanctions remained in place and other sanctions could be re imposed if the IAEA deems that Iran is non compliant with the agreement. With some of the major barriers to economic growth lifted, Iran can finally be able to address issues of inflation and unemployment more efficiently and effectively. However, while the recent deal with the West is an integral aspect of Iran s re integration into the global economy, the situation is not perfect as various domestic challenges stand between Iran and success. These issues will not be easily solved without a concrete strategy. With the JCPOA enabling Iran to re integrate into the global economy, Iran can begin to address many of the challenges it currently faces, including improving the economy, modernizing the military, and dealing with militants fighting near the Iranian frontier. While these domestic issues could be resolved with a cohesive plan, the Iranian cabinet must balance the interests of both moderates and hardliners to ensure the plans can be carried out. While moderates such as President Rouhani have plans to revitalize the economy by reducing dependency on oil production and other liberal policies, hardliners in Iran are fighting to maintain a more traditional Iran. Moreover, Rouhani s first term ends in 2017, which puts the reforms that the moderates would like to enact in jeopardy. 38 Over the coming year, it is of the utmost importance that Iran continue to make reforms because, although the JCPOA gave Iran some relief, the benefits of the agreement will be short lived without comprehensive reforms. Historical Background: 38 https://www.theguardian.com/world/iran blog/2016/jan/18/iran economic reform blocked

Given the fact that many of the challenges that Iran faces domestically can be attributed to the tension between hardliners and moderates, it is important to understand the history of the past two presidents and how the dynamics of Iranian politics have changed over the past decade. Before President Rouhani, there was President Mahmoud Ahmadinejad. Ahmadinejad served as president of Iran between 2005 and 2013 and channeled populist policies during his tenure. His career in politics began in obscurity as he was really only known for the time he served as mayor of Tehran in 2003. 39 His career as mayor was characterized primarily with rolling back the reforms and curtailing the social freedoms enacted by his more moderate predecessors. After his service as mayor, Ahmadinejad ran for the presidency in 2005 and beat his moderate opponent Ali Akbar Hashemi Rafsanjani. During his first term, Ahmadinejad established himself as a populist and also invoked his credentials from the Iranian Revolution and his time serving in the Revolutionary Guard. Given his populist message, Ahmadinejad focused primarily on economic reform and addressing poverty domestically. This was done by improving economic policy and ending the unrealistic spending and borrowing patterns of his predecessors. As a result, in his first term Ahmadinejad reduced the unemployment rate to 10.3 percent from 11.3 percent and improved performance in the housing and mining industries. 40 During this time, Ahmadinejad also saw great success in the oil sector thanks to high prices in the world market. Even in spite of 41 sanctions, Ahmadinejad s administration was able to make some economic improvements. Ahmadinejad also addressed poverty in a variety of ways, including redistributing oil income, increasing subsidies for food and petroleum, and increasing spending by 25 percent. 42 He also 39 http://www.bbc.com/news/world middle east 10866448 40 http://in.reuters.com/article/iran unemployment idindah13987520080331 41 (see 40) 42 http://www.payvand.com/news/07/jan/1295.html

preferred not to increase oil prices as he believed that oil income would be freed up in the future after various investments were made, especially in Iran s infrastructure. While the economy experienced some success under Ahmadinejad, many Iranian economists criticized his policies of stabilizing prices and increasing workers salaries as unsustainable. 43 These economists cited the fact that Ahmadinejad s policies have increased inflation significantly. While the official rate at the time of the letter was around 12.1 percent, there were other unofficial estimates that were as high as 24 percent. 44 Thus, the economic policies of Ahmadinejad could be considered a qualified success given that they alleviated some pressure from sanctions but also continue to create problems today concerning inflation and, to an extent, unemployment. President Ahmadinejad also has a history of aggressively supporting Iran s nuclear program. Throughout his presidency, Ahmadinejad maintained the stance that the nuclear program, although ambitious, was designed exclusively for civilian purposes and that the acquisition of a nuclear weapon was not his administration s policy. 45 However, Ahmadinejad still used the nuclear program as a sign of strength for Iran by intensifying the program throughout his term, much to the chagrin of the West. President Ahmadinejad was known for keeping IAEA inspectors out of nuclear facilities and antagonizing U.N. officials. In fact, at one point the Supreme Leader Ayatollah Ali Khamenei criticized Ahmadinejad s personalization 46 of the nuclear debate. 43 http://www.dailystar.com.lb/business/middle East/2006/Jun 16/72571 iranian economists lash out at ahmadineja ds policies.ashx 44 (see 38) 45 http://www.rferl.org/content/article/1078476.html 46 http://articles.timesofindia.indiatimes.com/2007 01 19/rest of world/27884456_1_supreme leader mahmoud ahma dinejad ayatollah ali khamenei

If Ahmadinejad s presidency was characterized as hardliner friendly and anti West as a whole, then Rouhani s presidency is quite the opposite. Hassan Fereydoon Rouhani was elected to the presidency in June 2013 and is still currently in his first term. When Rouhani ran for the 47 presidency, he was up against an establishment that was chiefly comprised of hardliners. Although Ahmadinejad s policies were successful in his early years, they had taken their toll on Iran by 2013. Sanctions had taken their toll on the economy, standard of living, and Iran s reputation. In the spirit of Rouhani s campaign slogan, which was moderation and prudence, Rouhani promised to get the sanctions uplifted and relax the strict policies of the hardliners. Many of Rouhani s policies can be characterized as confidence building externally and reforming internally. Naturally, a large part of Rouhani s presidency was devoted to re integrating Iran into the global economy through the JCPOA. Before he ran for president, Rouhani served the Supreme National Security Council (SNSC) as its chief negotiator between 2003 and 2005. Once he became president, Rouhani convinced the Supreme Leader to give negotiating authority to the Foreign Ministry as opposed to the SNSC. 48 This enabled Rouhani to put more moderate negotiators on his team. Of Rouhani s presidency thus far, the JCPOA is his greatest achievement. The JCPOA is the foundation for all of the reforms and improvements Rouhani wants to enact domestically since so much of Iran s performance is dictated by economic integration. Current Situation: Iran is currently at a crossroads: either moderates can continue to reform Iran or the hardliners will regain power. Rouhani s administration has helped progress in Iran, but much of 47 http://www.bbc.com/news/world middle east 22886729 48 (see 42)

his work can be undone during the 2017 election. Hardliners have made it their mission to remove Rouhani from power, and they have a chance at doing so. In June of this year, rumors spread of Ahmadinejad intending to run for president in 2017. 49 Hardliners believe that Ahmadinejad is their best hope of ending the reforms of Rouhani s administration. Not only are hardliners contesting Rouhani s leadership, but they are making efforts to prevent comprehensive reforms outside of the election. Some analysts believe that concrete 50 economic reform will not happen in Rouhani s term because of obstruction from hardliners. This analysis was partially attributed to the fact that the JCPOA unfroze $100 billion of Iranian assets, which will be used to invest in the country. While this is good for the economy in the short run, it does disincentivize lasting economic reform. On top of sanctions, there are many institutions in the public sector that are incredibly inefficient and riddled with corruption. These inefficient state owned institutions discourage foreign investment and perpetuate a cycle of poor growth. While economic integration is a top priority at home, Iran must also modernize its military so it can operate more effectively domestically and in the region. At one point, Iran s air force was highly advanced and the envy of the region. However, it is now a shadow of what it used to be. The Iranian air force is comprised of antiquated planes and old defense technologies. Iran currently owns 348 fighter jets, which makes it the 9 th largest air force in the world. However, the quantity does not offset the poor quality of the aircraft. Thanks to a relaxation of sanctions, Iran has an opportunity to purchase fighters from Russia as there have been contract negotiations since 2014. 51 That being said, Iran still faces considerable opposition from the 49 http://www.haaretz.com/middle east news/iran/1.727632 50 (see 38) 51 http://www.thedailybeast.com/articles/2016/06/27/iran s trying to rebuild its air force.html

United States on defense contracts so the deal to purchase arms from Russia may be in limbo until 2021. There are similar contract negotiations occurring in other branches of the military, but they share a similar fate to the air force s contract. If Iran is going to improve its military, then it should consider searching for other suppliers and maintaining good standing abroad. However, this must not detract from reforming the economy. Discussion Questions 1. How has the dynamic established between moderates and hardliners shifted over the past few years? Over the past few months? 2. How can Rouhani s administration ensure progress is maintained if his presidency is in at risk? 3. To what extent does Iran s re integration into the global economy related to state of domestic affairs? If they re strongly connected, how can Iran leverage success in one dimension and translate that into success in the other? Resources: https://www.stratfor.com/analysis/iran economic reforms hit hard line http://www.reuters.com/article/us iran sanctions un idusbre89412z20121005 http://www.aljazeera.com/news/2016/01/iran rejoins world economy sanctions lifted 16 0117132734049.html https://www.theguardian.com/world/iran blog/2016/jan/18/iran economic reform blocke d http://www.bbc.com/news/world middle east 10866448 http://in.reuters.com/article/iran unemployment idindah13987520080331

http://www.payvand.com/news/07/jan/1295.html http://www.dailystar.com.lb/business/middle East/2006/Jun 16/72571 iranian economist s lash out at ahmadinejads policies.ashx http://www.rferl.org/content/article/1078476.html http://articles.timesofindia.indiatimes.com/2007 01 19/rest of world/27884456_1_supre me leader mahmoud ahmadinejad ayatollah ali khamenei http://www.bbc.com/news/world middle east 22886729 http://www.haaretz.com/middle east news/iran/1.727632 http://www.thedailybeast.com/articles/2016/06/27/iran s trying to rebuild its air force.ht ml