Selling Iran: Ahmadinejad, privatisation and a bus driver who said `no'

By Billy Wharton

June 26, 2009 – A creeping assumption lies just beneath the surface of arguments concerning the disputed election in Iran. Incumbent Mahmoud Ahmadinejad is cast as an anti-US populist crusader resisting the materialistic advances of the West. His opponent, Mir-Hossein Mousavi, as his foil – a Western-backed liberal intent on implementing free-market policies. Violent street battles have been presented as a reinforcement of the Western disposition to see the two idealised positions as the limit of what is politically imaginable. Such arguments conveniently avoid a third force – the people of Iran, whose street politics threaten to move well beyond the confines of the electoral campaigns. Questions remain. Is Ahmadinejad really a populist – the only force preventing a wave of pro-market policies in Iran? Does Mousavi’s campaign mark the limits of the reform movement?

Since his election in 2005, Mahmoud Ahmadinejad, under the guidance of the Supreme Leader of Iran Ali Khamenei, has overseen a regime dedicated to the privatisation of state-controlled industries. The intention of the regime, as stated by the newly appointed governor of the Bank of the Islamic Republic of Iran, Seyyed Shams Al-din Hosseini, is to privatise 80% of state-owned industries by 2010. This mandate was made real just prior to the disputed election as a state-owned bank, Saderat, announced it would offer 6% of its shares to private investors (Press TV, 6/8/09). Other significant privatisations during Ahmadinejad’s reign include the postal service, two other state-run banks (Tejerat and Mellat) and, in February 2008, a 5% bloc of shares in the publicly owned steel maker, Foulad-e Mobarakeh, was sold out in eight minutes (Iran Daily, 2/14/08). In total, since 2005, 247 enterprises have been processed by the Iran Privatization Organization, the state ministry specifically charged with overseeing privatisations (Iranian Privatization Organization website).

‘Between 80 and 90 per cent of the government will be sold'

Khamenei has propelled the process forward. While Ahmadinejad crafted just enough populist rhetoric to provide headlines, the Supreme Leader issued a letter in 2006 ordering the sell-off of banking, mining, industrial and transport companies – 80% across the board. Ahmadinejad’s ministers have aggressively followed suit. In September 2008, Labour Minister Mohammad Jahromi described the fact that so many of the country’s resources are located in the public sector as an “obstacle” to growth (Iran Daily, 9/29/08). Heidari Kord-Zangeneh, Ahmadinejad’s deputy finance minister and head of the Iran Privatization Organization, drew pro-market policies together with the myth of anti-imperialism. “We are going to activate our private sector and our private banks”, he exclaimed, “... in order to fight against these [US] sanctions.” He punctuated this with a pre-election promise, “I promise that if I am here for the next two years, between 80 and 90 per cent of the government will be sold” (Iran Daily, 2/12/08).

Ahmadinejad’s supposed anti-Western approach stops short when it comes to allowing foreign investors to penetrate Iran’s economy. His Minister of Economic Affairs and Finance Davoud Danesh-Jafari boasted at a 2008 meeting of the Islamic Development Bank that foreign direct investment in Iran had increased by 138% since 2007 (Iran Daily, 2/17/08). Some 80 projects had been initiated during that period. Key to this capital penetration was the 2004 acceptance of the International Monetary Fund’s (IMF) article VIII obligations (IMF press release, 9/14/04). Under this provision, Iran agreed to refrain from imposing restrictions on currency transactions and other elements essential to capital flow.

While Ahmadinejad has been the implementer of privatisation policies, the reform camp were its architects. Central to this process was the creative violation of article 44 of the Constitution of the Islamic Republic of Iran. This article mandates that key sectors of the economy remain in public hands. It represented the radical-populist edge of the 1979 revolution. Parliamentary legislation in 2004, near the end of the regime of reformer Mohammad Khatami, created the first breech in article 44. The legislation called for a “change in the role of government from direct ownership and management of enterprises to policy-making, guidance and overseeing” (Iranian Privatization Organization website). The one consistent voice pushing this process forward is Khamenei, whose tenure as Supreme Leader encompasses both reformer and populist presidential regimes.

IMF approval

The IMF has hailed this process describing Iran in a 2007 position paper as “Managing the Transition to a Market Economy”. The fund has had a constant presence in the country since 1945, surviving even the turbulent 1979 revolution. IMF officials have employed the usual equation of debt and technical assistance to enforce their pro-market agenda. The next phase, according to IMF planners, of market transition is to “curb the growth of internal demand” through the reduction of state subsidies. Ahmadinejad’s central bank appointee, Al-din Hosseini, indicated a shared sentiment: “The government plans to implement a strategy that involves significant reforms, the most important of which is the reform aimed at better subsidy system” (IMF meeting, 10/13/08).

Pro-market privatisations have been combined with harsh restrictions on workers' ability to organise in order to advance Ahmadinejad’s neoliberal restructuring of Iran. Although Iran is technically a member of the International Labor Organization, and thereby mandated to allow free trade unions, workers are restricted from forming independent unions. Under the constitution, they are only allowed to join ideologically centered Islamic Worker’s Councils, which hold no right to deal with worksite issues or collectively bargain. Despite these legal restrictions, privatisation and soaring inflation have resulted in a series of escalating confrontations between workers and security forces.

In March 2007, thousands of school teachers spilled out into the streets in front of parliament demanding that their collective grievances be heard and their salaries increased. They were attacked by security forces and their leaders received prison sentences of up to five years. Such repression did not deter Mahmoud Salehi, a baker, from making his annual demand to celebrate May Day. Salehi was found guilty of “acting against national security” and imprisoned. This year, in a small preview of the post-election street protests, Ahmadinejad’s security apparatus was used to repress 2000 workers who attempted to organise a May Day celebration.

The bus driver who said ‘no'

But the real foil to Ahmadinejad’s pro-market policies is a middle-aged bus driver from Tehran. Mansour Osanloo, acting as the president of the 17,000 worker-strong Syndicate of Workers of Tehran and Suburbs Bus Company, led a 2005 strike in which drivers refused to accept fares in protest at working conditions and rising fares. The strike was immediately criminalised with Osanloo and fellow leaders placed under arrest. Undeterred, Osanloo led another strike attempt in 2006. He was again arrested and today sits in a cell in Iran’s notorious Evin prison – a living testament to both the courage of Iranian workers and the repressive nature of the regime.

Soon to be joining Osanloo in Evin are thousands of protesters who have also been criminalised by Ahmadinejad and Khamenei’s regime because of their protests over the stolen election. While it is difficult to describe a candidate with as many establishment credentials as Mousavi as a reformer, it is easy to see how the demonstrations on the street have rapidly progressed beyond his campaign. Slogans have moved from “Mousavi get our votes back” to “Death to the dictator”. With this shift comes possibilities for more radical measures. Auto workers at Khodro Automobile Company have pledged resistance, university students are conducting sit-ins and the bus drivers' union has issued a call for international solidarity.

Meanwhile, somewhere deep inside Evin prison, clandestine communications may be being initiated between a jailed bus driver and a newly minted student radical or an ailing baker and young rock-throwing worker. These actors need little help in understanding that Ahmadinejad’s regime, despite all his populist rhetoric, has worked hand-in-hand with IMF privatisers. After failing to deliver on his populist rhetoric, Ahmadinejad has stolen the election. Now, his only recourse is state repression. On the streets, something far more brilliant is underway – an open-ended emancipation project demanding nothing less than political freedom

[Billy Wharton is the editor of The Socialist and the Socialist WebZine. His articles have recently appeared in the Washington Post, Monthly Review Webzine, The Indypendent, Common Dreams and Links International Journal of Socialist Renewal.