Chapter 1 - Can Iran become "moderate", and what are the implications for the West?

On the list of concerns that unsettle sceptics of the Iran nuclear deal, one issue looms above all others. Beyond break-out timelines and snapback sanctions and the infinite technical details contained in the meticulously parsed 159 pages of text released after the July 2015 conclusion of tortuous negotiations, what matters most about the accord is its impact on Iran’s often unpredictable post-revolutionary politics. Can an agreement crafted through intense dialogue with an old adversary alter the essence of the Islamic Republic and its turbulent relationship with the world? And what kind of Iran is likely to emerge from this extraordinary re-opening of a revolutionary state, particularly once the negotiated limits on its nuclear program begin to expire?

The nuclear agreement did not address Iran’s political system, and in his assiduous defence of the bargain, US President Barack Obama and other senior US officials repeatedly insisted that the accord does not rely on the expectation of political change within Iran.  In a post-deal press conference, Obama argued that “this deal is not contingent on Iran changing its behaviour. It's not contingent on Iran suddenly operating like a liberal democracy. It solves one particular problem, which is making sure they don't have a bomb^{Footnote 1}”. The Obama administration hedged almost reflexively throughout its efforts to win approval for the deal.

Iran itself represents the most important variable in determining whether this arrangement succeeds or fails. While the deal establishes copious mechanisms for verifying, rather than trusting, that Tehran is upholding its end of the bargain, even the most stringent monitoring efforts cannot sustain a pact with a fundamentally unwilling partner, or one that is determined to abjure its obligations under the deal.

Ultimately, it is the nature of the Islamic Republic that amplifies the threat posed by its nuclear ambitions and animates the most tenacious opponents of the deal. It is the Iranian government—not the terms of deal itself—that will determine whether the agreement can provide a springboard to other avenues of cooperation on thorny differences between the two old adversaries—an implicit but important selling point for nuclear diplomacy. For that reason, the fierce debate that erupted in Washington after the agreement was announced, and which continues to animate the US policy debate over Iran, hinges on the prognosis for Iran’s future.

Critics see the regime as irredeemably malevolent and, on this basis, castigate the terms of the deal as insufficiently ironclad. Many US policy-makers harbour an instinctive suspicions towards the notion of Iranian moderates or wishful prospects of political change in Iran. Given the history, this is hardly surprising. After all, it was the siren song of strengthening purported Iranian moderates that persuaded the Reagan administration to indulge in the disastrous and illegal scheme to sell arms to Tehran and funnel the profits to Central American rebels. The first Bush administration tried and failed to work out a deal with some of those same moderates to secure the release of Western hostages held in Lebanon. The Clinton administration sought to leverage the rise of Iranian reformists through repeated overtures that went unreciprocated.

From the perspective of many US policy-makers, Iran’s convoluted factional landscape offers pitfalls but no promise, either for meaningful change on the issues of greatest concern, or for generating traction on overcoming the long bilateral estrangement. Even as Iran’s political dynamics shifted and the social basis for the regime evolved considerably, much remained unchanged: the regime’s support for terrorist organisations, rejection of the possibility of peace between Arabs and Israelis, its massive investment in a covert nuclear program, and its mistreatment of its own citizenry. This interpretation caricatures Iranian moderates as either dupes or ploys, smiling front men who are deliberately or unwittingly elevated in order to lull the erosion of sanctions and advance a nefarious determination to achieve nuclear weapons capability.

Meanwhile, even Obama’s restrained public rhetoric betrays his trademark audacious hope—the same hope that propelled six years of diplomatic outreach to Tehran, even when the domestic politics there appeared utterly inhospitable. The administration’s approach was predicated on the conviction that Iran’s leaders could be persuaded to alter their most dangerous policies. Now that this presumption has been validated by the achievement of an agreement, what was once mostly hypothetical—the proposition that Iran can become moderate—seems temptingly inevitable. The possibilities seem infinite; if Tehran can apply a rational cost-benefit assessment to one aspect of its foreign policy, why not others? 

One understands that optimism; one is deeply susceptible to its allure. But those who have observed Iran long enough may resist it with reason. We have seen a version of this movie before, and know that the ending will almost certainly disappoint. The Islamic Republic has been struggling to reform itself for 25 years—the better part of its post-revolutionary existence—and each time, the experiment has gone awry. Iran’s revolutionary theocracy has evolved since 1979, but the most problematic aspects of its ideology and institutions have managed to endure. Why? And will the current experiment result in a different outcome?

Any realistic interpretation of the prospects of sustained moderation requires a thorough understanding of the historical context. The Islamic Republic has experienced four previous episodes in which political movements sought to temper the ideological impulses of the revolutionary state, in divergent directions and with a range of outcomes. In fact, the dichotomy between ideological and liberal impulses was effectively baked into the structure of the Islamic Republic, through its novel fusion of theocratic-authoritarian and republican institutions. The elevation of Mehdi Bazargan, a religious intellectual with a background as a technocrat, to lead the post-revolutionary provisional government positioned that institution, and more broadly, the executive branch of the new state, in a debilitating conflict with the revolution’s spiritual guide, Ayatollah Ruhollah Khomeini, and his closest advisors.

During his brief tenure, Bazargan sought to hold the centre as the dynamics of competition among the revolutionary coalition pushed each contender to occupy the extremes. His mission was the re-establishment of central authority, a task that by definition entailed deliberation, collaboration and moderation—which were also the hallmarks of Bazargan’s personal and political style. But this approach was foiled at every turn by the willingness of rivals to utilise informal channels of authority, such as the revolutionary committees, security forces and tribunals, as well as by their tendency to invoke absolutist rhetoric. At every turn, Bazargan found himself outmanoeuvred and disempowered. Iran’s experience had discredited the liberal, reformist option, creating “a break in the continuity of reform-oriented politics, and decline of a political culture in which the idea of reform from within remained a viable option^{Footnote 2}”.

the dichotomy between ideological and liberal impulses was effectively baked into the structure of the Islamic Republic...

The November 1979 seizure of the US embassy, and its endorsement by Khomeini, officially decided that power struggle in favour of the clerical faction, which quickly set about formalising their interpretation of an Islamic state. And yet the ideological tensions and competition for power within the nascent theocracy endured, and actually intensified, even as Tehran quickly found itself waging an existential battle against its fiercest regional adversary, Saddam Hussein.

The war’s devolution into a frustrating, ferocious stalemate gradually generated new pressures within the revolutionary regime and a parallel ideological gridlock among the political elite. Over time, the monumental costs—in economic, political, and social terms—of sustaining the conflict with Baghdad helped advance a gradual and ultimately incomplete rationalisation of Iranian politics and policy. It began even before the end of the war, but came to fruition in tandem with constitutional revisions and a bureaucratic reconfiguration necessitated by Khomeini’s death a year later. Ali Rafsanjani, who assumed the newly empowered post of the presidency, was determined to build upon the creeping moderation already underway in Iran’s domestic economic and social policies and formulate a full-fledged agenda of reconstruction and development.

In re-orienting the revolutionary state, Rafsanjani faced an array of thorny challenges: an embryonic balance with Khomeini’s successor, former president Ayatollah Ali Khamenei; deep-seated suspicion from Iran’s neighbours and potential trade partners in Europe and Asia; political opposition from the theocracy’s leftist camp, who opposed his efforts to re-engage with European powers and introduce market reforms; per capita income eroded by the revolution, war and the post-revolutionary baby boom to nearly half its value under the monarchy; and a rapidly changing international geostrategic environment, with the collapse of the Soviet Union and the emergence of a new Arab-Israeli peace process brokered by the US.

The reconstruction program got off to a strong start; however, a combination of factional obstructionism, low oil prices and economic missteps undercut the early successes. Pent-up consumer demand and the theocratic aversion to long-term borrowing created a perfect storm: a short-term debt crisis that fed already robust inflation rates and deterred foreign investment while corruption appeared to mushroom. The president’s preferred solutions—such as utilising the system’s unelected institutions to blunt the sway of his left-wing rivals—insulated his agenda only marginally, and his bolder initiatives, including a bid to woo Washington via upstream oil investments, fell flat amidst growing concerns about Iran’s support for terrorism in the Middle East.

The trials and tribulations during the Rafsanjani presidency played a major role in shaping Iran’s subsequent evolution. The clashes between Rafsanjani, the reforms’ architect and chief advocate, and the Islamic leftists, who remained wedded to state-centric policies and viewed capitalism as a betrayal of the revolution’s ideals, helped to reshape the revolutionary state’s ideological battleground. Having found themselves suddenly side-lined on the margins of the state they had helped create, Iran’s Islamic leftists began to reassess their handiwork and plot their way back to power. These tensions cultivated the first serious movement to reconsider the tenets of Iran’s Islamic state.

The movement that arose around the re-imagined leftists launched the Islamic Republic’s third experiment in restraining the ideological imperatives of the revolutionary state. The politicians who spearheaded what quickly became known as Iran’s reform movement began as loyal adherents to the Islamic system—eager participants in the revolution frustrated as the state assumed more autocratic features. The reform movement’s leadership neither rejected the Islamic system’s fundamental premise nor sought its wholesale removal. Rather, they wanted to rehabilitate the Islamic Republic by implementing its limited guarantees of representative government, equality and freedom.

These were the campaign slogans of Mohammad Khatami, whose idiosyncratic 1997 bid for the presidency unexpectedly caught fire and upended a more conservative presumptive successor to Rafsanjani. Khatami’s tenure brought the debates over transforming the Islamic Republic’s political compact well beyond the system’s elite for the first time, and his popular mandate of 20 million votes endowed his two terms with a potent undercurrent.

For Khatami and his cohorts, the most effective pathway for ameliorating the system’s deficiencies was through a focus on rule of law. Their liberal reading of Iran’s constitution facilitated the quadrupling of the country’s press outlets in Khatami’s early years, which helped re-politicise a new generation of Iranians and challenge Iran’s prevailing orthodoxies and oligarchies. Insistence on rule of law empowered an investigation into the shadowy intelligence war against dissidents and some pushback against the indiscriminate violence perpetrated by the country’s security bureaucracy. By implementing long-disregarded constitutional provisions for local elections, Khatami expanded national support for democratic institutions and dispersed some authority from the centre to Iran’s provinces. They sought to rein in the judiciary, enhance the supervisory role of the elective body that selects Iran’s supreme leader, and empower the authority of the president.

The reformists found many of their initiatives rebuffed or undone by the orthodox defenders of the system who remained in control of the key levers of power, including the judicial system, the security forces and the thugs on the streets. Their apparent futility in the face of the conservative counter-reaction exacerbated public dissatisfaction with the pace of change under Khatami. And in the final humiliation, the reformists’ rivals mirrored their deployment of the media as well as their calculated strategy to utilise the electoral institutions of the Islamic Republic to their partisan advantage.

If Khatami was perceived as too restrained in his willingness to push back against saboteurs, the fourth and final struggle to advance moderation began with the eruption of public protests and the emergence of the first serious indigenous opposition movement since the early years of the Islamic Republic. The contested 2009 re-election of Mahmoud Ahmadinejad to a second term of the Iranian presidency galvanised a larger number of Iranians—as many as one million protestors participated in some of the early demonstrations by some estimates—than at any time since the revolution itself. Unlike the three prior episodes at moderating the Islamic state, the Green Movement was only tangentially led by elite political actors; the putative victors in the race, reformist candidates Mir Husayn Musavi and Mehdi Karroubi, helped animate the first crucial stage of taking to the streets but the activism was primarily driven by grass-roots mobilisation. However, while the 2009 protests sought to restore the legitimacy of Iran’s electoral institutions via popular pressure, they were handily repressed.

Each of these episodes helped further societal processes of evolutionary change within the Islamic Republic. Yet, viewed as discrete initiatives, none of these four efforts at change from within the system can be judged successful. An examination of the historical record suggests that there are at least four primary factors that have constrained each of the efforts to change the Iranian system from within.

The first factor is a structural one, and in many respects looms above all others. The Islamic Republic is not a typical authoritarian system. Fundamentally, the post-revolutionary governing system in the Islamic Republic biases all outcomes in favour of authoritarian control, as the deliberate limitations of the existing system create insurmountable hurdles for reforming policies or institutions. To remain politically viable in the Islamic Republic entails obeisance to the unquestioned hegemony of the Supreme Leader, who remains unwilling to contemplate meaningful devolution of his authority or transformation of other essential elements of the theocratic system. It is a kind of prisoner’s dilemma: advocates of change must play by the rules of the game, including fidelity to velayet-e faqih-ye motlaq (absolute guardianship of the Jurist). Anything less promises a prison sentence or exile—and effective irrelevance to political outcomes in contemporary Iran.

...the post-revolutionary governing system in the Islamic Republic biases all outcomes in favour of authoritarian control...

However, in practice, playing by the rules of the game costs moderates and reformers the entire match. Iran’s robust electoral system has tended to focus resources and energies on the discrete objective of securing victory at the ballot box. The forces behind the reform movement, for example, devoted considerable time and energy to strategies aimed at enhancing their control of various electoral institutions, and to strengthening those same institutions: implementing a strategy to avoid disqualifications, honing their messages, preparing a slate of candidates, as well as seeking legislative remedies for the constraints on the authority of various representative institutions.

However, electoral remedies cannot in fact compel outcomes within Iran’s hybrid republican system; their capacity to shape day-to-day policies remains explicitly and absolutely circumscribed. In particular, the use of force, both legal and extra-legal, has remained almost wholly outside the grasp of the elective institutions—meaning that moderates can neither impose penalties on their adversaries within the political system, nor can they insulate their own ranks from the threat or use of coercive measures.

If the structure of power within Iran tends to undercut gradual change, so too do the tactics adopted by the partisans on either side of the debate. The Iranian political actors who are interested in a liberal evolution of the system have sought to emphasise the art of the possible, both as a means of ensuring their permissibility within the narrow parameters of tolerated political discourse and to avoid inflating popular expectations. They have been selective and focused, targeting their efforts in limited sectors—such as economic policy, for Rafsanjani, or incremental reforms, during the Khatami presidency. Within these constrained horizons, they have achieved some results. But selective or targeted reforms have failed to create institutional linkages or popular momentum that might empower a platform of broader or systemic change.

Meanwhile, they encounter in the opponents of change a seemingly unlimited willingness to avail themselves of any means necessary to assert their pre-eminence and forestall reforms. They have a long experience in provoking crises as a means of reinforcing revolutionary fervour—for example, the pronouncement of a fatwa condemning British writer Salman Rushdie to death for his novel The Satanic Verses in 1989; Mahmoud Ahmadinejad’s deliberate demagoguery around Israel and the Holocaust; even the torching of the Saudi embassy in Tehran in 2016. By reviving ideological furies, these episodes obliged the reflexive reinforcement of the status quo, and in so doing enhanced the advantage of hardliners at the expense of their factional adversaries.

In addition, opponents of change have proven their capacity to utilise extremist tactics to block meaningful shifts in the political balance of power. Moderates and reformers have been the victims of skilful campaigns of character assassination, political “dirty tricks”, impeachment, prosecution, harassment and intimidation, and even deadly violence. Early in his presidency, Khatami lamented the fact that he had faced a new crisis every nine days, and despite the proliferation of assaults against his supporters and his agenda from within, he never managed to devise an effective strategy to repel or overcome them.

Second, as the brief historical review presented above underscores, the cause of gradual change or moderation appears to have broad support, but it has ultimately proven insufficiently robust to sway opponents of reform or moderation. A little democracy can be a dangerous thing; political literacy and activism is directed into the available channels. Iranians tend to vent their political frustrations against those political actors who are most readily accessible, and in this fashion they have repeatedly lost faith in the leaders they elected who promised change but failed to fully deliver.

Both Rafsanjani and Khatami entered the presidency buoyed by strong majorities and their policies of economic reform and socio-political liberalisation appeared to command wide support among the Iranian population. Yet both suffered considerable slumps that threatened their second-term electoral mandate and even more dramatic set-backs in terms of popular support by the time they left office. Even now, there is some evidence of a similar phenomenon affecting the presidency of Hassan Rouhani.

The third obstacle to moderation in the Islamic Republic is simply the tendency for events to overtake the best of intentions and the most cleverly designed strategies for advancing change from within the system. Reform cannot take place in a vacuum and the realities of a region in turmoil have repeatedly intruded on, distracted from, subverted and/or overturned the premeditated planning. Political actors are forced to pivot to adapt to developments that they could not have anticipated when they launched their efforts to change.

The end of the Cold War, the Iraqi invasion of Kuwait, the Asian economic crisis, the 9/11 attacks and the military interventions pursued by Washington in their aftermath, the Great Recession, and the emergence of the Islamic State in Iraq and the Levant (ISIL)—each of these developments caught Iran’s leadership off guard, and prompted adjustment and redirection. For moderates and reformers, the need to revise their strategies to contend with new circumstances that are often fluctuating and uncertain seems to have detracted from their capacity to advance their initial agendas.

Finally, despite the casual expectation that the resolution of the nuclear impasse and the lifting of multilateral sanctions will strengthen Iranian moderates, this appears to be an assumption based on a fallacy. A careful review of Iran’s post-revolutionary history does not offer evidence of a direct correlation between economic growth and/or economic liberalisation and political change, at least not one that plays out in the short term. This apparent disconnect can be explained by a variety of factors: the distortions of price volatility for Iran’s resource-dominated exports; the capital intensity of the largest sectors of Iran’s economy; the persistence of corruption; the lag time for investment to begin to impact expectations and pocketbooks; and the repression of organised labour and other social groups that might benefit from economic reforms—among others.

The simple conclusion that can be drawn from thirty-seven years of alternating experiments in political moderation and economic reform is that Iran’s experience is consistent with the trends observed more widely in the Middle East: economic factors may be relevant to success in facilitating a transition away from authoritarianism, but they do not constitute a precondition nor a panacea for political liberalisation^{Footnote 3}.