What achievements has the resistance economy brought for the people?
What achievements has the resistance economy brought for the people?
More than a decade has passed since the leader of the Islamic Republic announced the resistance economy policies to counter the sanctions of Western powers. Some connected economic experts say the outcome of Ayatollah Khamenei’s resistance economy for Iranian citizens after 11 years has been nothing but a deeper imbalance between income and expenses, a widening class gap, an unbelievable surge in foreign currency rates, and a drop in the national currency’s value.
Every government has tried to improve the poor economic situation by following the leader of the Islamic Republic’s guidance. Ebrahim Raisi wanted to ‘surgically’ fix Iran’s economy, as he put it. However, Abdolnaser Hemmati, his defeated electoral rival who had been critical of Raisi’s economic policies, became the Minister of Economy in the fourteenth government and said Iran’s economy has risky paths with limited choices ahead. One of these paths, according to him, was the policy of unifying currency rates, which has now placed the Minister of Economy on the impeachment list of the twelfth parliament, dominated by conservatives.
Mehdi Ghodsi, an economic expert at the Vienna Institute for International Economic Studies in Austria, discusses sanctions and government revenues. He says when the government is in need and cannot cover its expenses, it manipulates exchange rates and devalues the rial to make up for its budget deficit. Mr. Ghodsi believes that the government institution in the Islamic Republic compensates its expenses through inflation, which it views as a form of tax. This economic expert refers to 16th and 17th century France, where the government funded its expenses by increasing taxes, ultimately leading to the French Revolution.
Mehdi Ghodsi sees the leader of the Islamic Republic’s talks about the resistance economy being endogenous and exogenous as entering a cycle that other examples such as Cuba, Venezuela, and even Syria before their political system changes have entered, managing to preserve their economic systems under the name of a resistance economy. Abdolreza Ahmadi, an international economics expert, considers the issue of sanctions in South America as a secondary discussion. He points to the changes in Argentina brought about by President Javier Milei and believes the increase in Argentina’s national currency value is evidence of a market-based and free economy approach.
According to this expert, the discourse of ’57 led Iran into a wrong path called a state economy and eliminated private ownership. Mr. Ahmadi also attributes the surge in the dollar price, aside from the imbalance of Iran’s imports and exports, to domestic inflation and the lack of foreign currency reserves. This expert refers to a listener’s message about the moral collapse of Iranian society, saying that when the concept of homeland is systematically destroyed in a governance pyramid, national interests for those at the bottom are replaced by personal and group interests to save themselves, thus adding to the chain of corrupt holding companies.
Mehdi Ghodsi believes the root of Iran’s economic problems lies in the constitutional statute and the powers of the Supreme Leader, saying they wanted to bring oil to the people’s homes and thought they could easily do so with subsidized prices. Mr. Ghodsi compares the cost of gasoline in Iran and Europe, stating that a European pays about 1.5 euros per liter, while with government subsidies, it costs Iranians only two cents, a practice that won’t last long.
Nevertheless, Mr. Ghodsi believes that there have been bright economic periods in the Islamic Republic, citing the presidency of Mohammad Khatami, during which employment and unemployment rates significantly improved. However, this period did not continue due to the intervention of the leader of the Islamic Republic. In contrast, Abdolreza Ahmadi believes that where there is a governmental view of the economy, even when resources are handed over to the people, quasi-governmental entities come in and play the rent-seeking game.
Mehdi Ghodsi, discussing Iran’s economy departing from a balanced course, says that Ali Khamenei’s extreme policies, implemented since Mahmoud Ahmadinejad’s era, have increased sanction pressures to the extent that imports and exports have become costly for Iran. He cites the Persian Gulf countries as examples, believing that although they are not democratic, they have adopted the right policies toward other countries and superpowers. However, in Iran, the political system’s stubbornness and the autocracy of those at the top have come at the expense of the people’s lives and economy.
Abdolreza Ahmadi sees the authoritarianism in Saudi Arabia and the United Arab Emirates as nationalistic and says this type of governance does not work in Afghanistan because the political context is not focused on the homeland. This former business journalist at the Atlas Economic Research Foundation emphasizes the Islamic Republic’s exclusionary view of human resources, believing this perspective has led to a situation where in discussions like knowledge-based enterprises, a body like the Astan Quds seizes the entire market, forcing individuals to rely on quasi-governmental entities to create startups.
Mehdi Ghodsi analyzes this definition within the framework of a benevolent dictator. In such a society, a dictator provides services to the community to increase his power, thereby delivering intermittent shocks to the society and putting it on the path of development. However, according to Mr. Ghodsi, there is no guarantee that the heirs of a benevolent dictator will not change course in the opposite direction. In the view of this expert, in a governance model where one person is responsible, the likelihood of their irresponsibility increases, causing their power to change in response to an external or internal shock, provoking the society.
However, Abdolreza Ahmadi generally believes that the authoritarian monarchies in the region have yielded better results for their citizens than republics. He says the American political philosopher Fukuyama presents a simple reason for this in the state-building section, stating that if you want society to grow, you must have a political system where all individuals find their identity. Amidst the conflicts over the impeachment of the Minister of Economy in the fourteenth government, due to the government’s currency policies, Abdolreza Ahmadi considers Abdolnaser Hemmati part of the current problems in Iran’s economy.
