Ahmadinejad’s Inflammable Blunder
Meir Javedanfar explains how by rationing gas, Iran's president imposed sanctions on his people which are more devastating than anything the West could have come up with, and how the move could deal a mortal blow to Ahmadinejad's chances of re-election in 2009.
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For far too long Iran’s oil -and the hefty income from it- was appearing mostly on the table of the rich Iranians, considerable number of whom have strong connections with the government. Cries of “Nafte ma, haghe ma” (”our oil, our right,”) were very much present in the living rooms of the poor. However, they had no impact. Rich and corrupt politicians, like Ayatollah Rafsanjani, had no interest in sharing the oil wealth: They were too busy lining their own pockets and that of their cronies.
This has been infuriating Iran’s poor. Ahmadinejad noticed this and tried to make political capital from it. Consequently, prior to his election, he came up with the slogan “Oil money must be seen on the table of the people”, and used it extensively in his election appearances.
His man-of-the-people image, and his relatively good performance as the head of Ardebil province, and later on as the Mayor of Tehran, made some people believe that he believed what he said. His animosity against Rafsanjani was another factor which worked in his favor. The poor people thought that his hatred of Rafsanjani, whom he views as corrupt, could mean that Ahmadinejad would actually deliver on his promises: by doing so he would be taking Iran’s oil wealth from Rafsanjani’s clutches.
In order to show that he was fulfilling his promise, after his election Ahmadinejad went on a spending spree. He increased Iran’s budget by 27% in his first year as president, and then by 25% the year after. He visited 336 towns, cities and villages in Iran over two years, and gave away promises of dams, stadium, schools and hospitals. Some were delivered, others were not.
His big mistake was the fact that such an increase in spending came at a time of high inflation. By spending more, he actually pushed up inflation, thus making the purchase of everyday goods more costly and unaffordable for poor Iranians. Furthermore, he spent the money where only he and his team thought best. As a result, crucial parts of Iran’s infrastructure, such as it refining infrastructure, were left out. This means that despite being a major oil producer, Iran has to import more than 40% of its gasoline from abroad.
The recent rationing of petrol in Iran could deal a mortal blow to Ahmadinejad’s chances of re-election in 2009. Iranians were already having a hard time dealing with high inflation and unemployment. Now they have to pay more for gas, which means that Ahmadinejad will be actually taking oil money away from them.
To make matters worse, everyday tasks such as getting to work will be more difficult. As mentioned in a recent TV interview by Mohammad Bagher Ghalibaf, Tehran’s Mayor, Tehran’s bus fleet of 6000 is still 4000 short of the numbers needed to serve the people of Tehran efficiently. With no immediate plans to remedy this problem, how will millions of people who have to leave their cars at home due to the petrol rationing get to work? Furthermore, with the rationing plan pushing up the price of gasoline, who will pay for the extra cost of transporting essential goods such as food around Iran? The answer is the Iranian public.
Unfortunately for Ahmadinejad, and for Iran’s nuclear program, those who are likely to gain from the ensuing petrol fiasco are foreign governments who want to impose broader economic sanctions on Iran in order to stop its nuclear program.
By rationing petrol, Ahmadinejad has just imposed his own sanctions on the people of Iran, which are bigger and more devastating than anything the West could have achieved in the immediate future. The ensuing massive loss of popularity means that the people of Iran will now be less inclined to follow Ahmadinejad’s calls for hardship and sacrifice against further sanctions. Sensing this, Ayatollah Khamenei, the man in charge of Iran’s nuclear program, may possibly be forced into a compromise in the nuclear talks, as means of ensuring internal stability inside Iran, his number one priority.
Meir Javedanfar is the co-author of the upcoming book %%AMAZON=0786718870 “The Nuclear Sphinx of Tehran - Mahmoud Ahmadinejad and the State of Iran.%%” He runs Middle East Economic and Political Analysis (Meepas)
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15 Comments
willis:If you are wondering why so few people seemed to be interested in these astounding developments in Iran, I believe its because we have increasingly come to believe that our country will not exist long enough for it to matter. Our congress is in the process of surrendering control of our borders against the overwhelming will of our people. The growing fear is that loss of control of our entire country is following closely behind.
Jun 27, 2007 - 1:25 pm Chuck Pelto:TO: Meir Javedanfar
RE: A Method to Their Madness
“…how by rationing gas, Iran’s president imposed sanctions on his people which are more devastating than anything the West could have come up with, and how the move could deal a mortal blow to Ahmadinejad’s chances of re-election in 2009.” — Meir Javedanfar
Actually….
….I think he’s more worried about a forthcoming war with the US than re-election in two years.
Look at it. What is the rationale here? Did they lose one of their 9 refineries? Has Saudi Arabia, or some other gulf oil princedom stopped supplying their shortfall?
I didn’t hear of anything like that. So…what’s the reason?
From a military perspective, I’d say they’re getting ready for either sanctions and embargo, as a result of their refusal to stop their nuclear development or a war, by building up their strategic reserves.
The former…well…the UN is by and large toothless.
The latter….we’ve been gradually building up our combat power in the region over the last 10 months.
Regards,
Chuck(le)
[When you go to a gunfight, bring all your friends.]
Jun 27, 2007 - 4:23 pm M. Simon:Chuck,
The reason is simple.
Ahmadinnerjacket needs the money for jihad. With oil prices way up, selling gasoline for 40¢ a gallon is not possible if the jihad is going to be funded.
Jun 27, 2007 - 9:18 pm Angelo Rombola:Ahmedinijad is not the only one driving up prices of essential goods in his country. The US Congress is guilty of the same thing here. To wit: The mandate to use Ethanol mixed with gasoline for our cars is absolutely moronic. To comply with the asinine demands of environmentalists we now have to mix in a low octane product which actually costs around $4 per gallon & use it with gas at $3 a gallon. To produce Ethanol corn is required, so that we now have increasing demands on our food supply. Note that farmers are now more interested in growing corn to supply the almost 200 Ethanol refineries now in operation or being built than in growing it for food, primarily animal feed. They are also taking cropland formerly used for wheat, soybeans, oats & other grains and converting them to grow corn. The result: 1)more costly animal feed leading to higher prices for beef, pork & poultry. 2) Dairy prices for milk, butter & eggs are also on the rise.
Jun 27, 2007 - 9:58 pm Eg:3) Obviously other processed foods utilizing grains will also increase in price.
This is a no-win situation for US consumers brought about by the know-nothings in Washington who kowtow to environmentalists, and give lip-service to making the US self-sufficient in petroleum. ABAS
CONGRESS!!
We’ll shortly see if Ahmadinejad’s social behavior management skills are as keen as some believe and with each one of these demonstrations more and more of the quote-unquote dissidents are identified and **cough, cough** selectively isolated. Redirect the current hostilities towards the Great Satan who is no doubt behind this conspiracy and the occupation of their Brothers in Iraq and _________(fill in the blank).
Jun 28, 2007 - 2:25 am Chuck Pelto:TO: M.Simon
RE: Simple Simon
“The reason is simple.
Ahmadinnerjacket needs the money for jihad. With oil prices way up, selling gasoline for 40¬¢ a gallon is not possible if the jihad is going to be funded.” — M.Simon
It’s easier to take hostages of German and/or French descent and hold them for millions. And less costly in destruction of infra-structure at home. Not to forget becoming unpopular with the ‘constituency’; if you can call them that in a dictatorship.
Regards,
Chcuk(le)
Jun 28, 2007 - 5:35 am bman:[Useless Invention: Flame-retardant gasoline.]
The Mullahs are the key, and according to several reports three big turbans have been offed recently.
Jun 28, 2007 - 7:47 am Chuck Pelto:TO: bman
RE: Think Again
“The Mullahs are the key, and according to several reports three big turbans have been offed recently.” — bman
The Mullahs are just the current regime exercising power.
And, just because some of them are being killed, there are still plenty more willing to climb another rung up the ‘food chain’.
The PEOPLE are the ‘key’.
Regards,
Chuck(le)
Jun 28, 2007 - 8:21 am Meir Javedanfar:[Power does not corrupt man; fools, however, if they get into a position of power, corrupt power. — George Bernard Shaw]
To chuck
Yes, Ahmadinejad is getting ready for sanctions, but you can’t get ready for a punishment by punishing yourself, and driving away your sources of support. Well you can, but by doing so, you would be helping your enemies. Ahmadinejad is driving away the Iranian people from his cause, and thats exactly what the West wants
Jun 28, 2007 - 9:34 am Chuck Pelto:TO: Meir Javedanfar
RE: Sanctions?
“Yes, Ahmadinejad is getting ready for sanctions, but you can’t get ready for a punishment by punishing yourself, and driving away your sources of support.” — Meir Javedanfar
It could be sanctions, but the UN has hardly been inclined to do ANYTHING about Iran’s nuclear development program.
I give sanctions a very low probability. I think it’s going to be war. And this Summer.
Regards,
Chuck(le)
Jun 28, 2007 - 10:23 am bman:[Let every nation know, whether it wishes us well or ill, that we shall pay any price, bear any burden, meet any hardship, support any friend, oppose any foe, in order to assure the survival and the success of liberty. — President John F. Kennedy]
as much as I like the slogan “Power to the people”, they don’t and won’t have it until the Mullahs power is broken.
Jun 28, 2007 - 10:56 am Chuck Pelto:TO: bman
RE: Power and People and Mullahs, Oh My!
“as much as I like the slogan “Power to the people”, they don’t and won’t have it until the Mullahs power is broken.” — bman
And the people have the power to remove them….
….if they have the gonads.
And, US, as in “We the People”, can remove the Mullahs too. And then, who is the ‘key’?
Are we not back to ‘the People’?
Regards,
Chuck(le)
Jun 28, 2007 - 2:41 pm Chuck Pelto:[Courage looks you straight in the eye. She is not impressed with power-trippers, and she knows first aid. Courage is not afraid to weep, and she is not afraid to pray, even when she is not sure who she is praying to. When she walks, it is clear she has made the journey from loneliness to solitude. The people who told me she was stern were not lying; they just forgot to mention she was kind. (J. Ruth Gendler)]
P.S. Lest you forgot, or your Civics classes in the vaunted American public education system didn’t teach you well….
….’We the People’ established THIS country. And THAT in the face of all the hirelings King George could throw against US.
Jun 28, 2007 - 3:03 pm Brian H:Iran is a wounded, demented bear, and if it gets too dangerous may have to be put down.
Jun 29, 2007 - 12:06 am Kris:Ahmadinejad is a demagogue just like so many of our “promise the moon” politicians. Let’s see, Iran must be paying $1.50 to import gasoline and selling it for 40 cents. Where is that $1+ going to come from? Since taxes would make it obvious even to the poor and stupid that elected him, it’s another tool of the demagogue- printing money(inflation). The savings of the poor and midle class disappear right out of their bank account without them noticing the inflation tax. Then he can blame the price increases on the gas stations and the shopkeepers- more scapegoats to cover his demagoguery.
Since rationing causes enormous misallocation of resources/fuel, the people who don’t really need the gas, will start selling it to those that do on the free market(usually called black market by the demagogues) They will be called speculators, profeteers, gougers etc. , just like people who were supplying badly needed generators in Louisiana, got prosecuted and jailed. In Iran, probably there will be executions until even then nothing works and the whole socialist subsidy and price control that got the whole thing started is done away with and the free market rules. Communist regimes wouldn’t last very long, if the West didn’t give them 100s of billions of dollars in loans and aid. Even North Korea gets millions of our taxes right now. We need to have an enemy, how else will the enormous millitary budget,taxes and debt get justified? We have to watch out for demagogues, we have plenty of them here. Hillary voted for the war in Iraq and all the anointed “front runner” republicans are of the same big government sort. The only real small government candidate is Ron Paul. If you don’t want the Un one world government to keep sending our troops to die in police actions and do away with our constitution, vote accordingly.
Jul 2, 2007 - 2:08 pm