Iran’s socialist economists urge Pezeshkian to purge profiteers
A prominent Iranian economist has accused President Pezeshkian's inner circle of being profiteers who have exploited undue privileges over the past 35 years.
A prominent Iranian economist has accused President Pezeshkian's inner circle of being profiteers who have exploited undue privileges over the past 35 years.
Hossein Raghfar, an economist and professor at Al-Zahra University in Tehran, referred to various lists of potential top officials in Pezeshkian's administration, claiming that a group of politicians aligned with market speculators and profiteers are poised to receive key positions.
According to Rouydad24, Raghfar was one of the four Iranian economists who met with Pezeshkian immediately after his election to warn him against the political and social consequences of the government's decisions.
Raghfar told the website that at the meeting he and three other economists, Mohammad Reza Vaez Mahdavi, Farshad Momeni of the University of Tehran, and Gholamreza Hassantash warned Pezeshkian no to follow the policies of his predecessors and instead, pay more attention to the underprivileged people.
The academic who is a member of socialist economic group known as "institutionalists," is a proreform figure close to former Prime Minister and Green Movement leader Mir Hossein Mousavi. The members of this group believe that all Iranian governments that came to power after the 1980s Iran-Iraq war were under the influence of "capitalists" and that they simply enriched themselves by "plundering people's wealth."
He told the website that the Iranian economy is overwhelmed by financial corruption. Meanwhile, he charged that some 40 percent of the market for pharmaceutical products is controlled by security agents.
According to Rouydad24, the institutionalists are based at the Institute of Religion and Economics that used to be called "The Society of God-Worshipping Socialists" in the early 1980s.
Raghfar says that all the politicians who criticize the institutionalists are the followers of liberalism and market economy. Using reverse argument, the statement defines the school of thought of Raghfar and others who gather at the Institute of Religion and Economics.
The economist says he has warned Pezeshkian that trying to introduce a single rate of exchange for the US dollar is an impossible task and doing so is likely to push the people to take to the streets. The Iranian government provides cheap dollars for the import of essential goods, which itself has become a source of corruption. However, Raghfar and his like-minded socialists advocate keeping the system in place because it supposedly makes food cheaper for low-income people.
Raghfar and his friends have published three open letters to Pezeshkian in less than six weeks. In their third letter, they complained that the new president has not responded to their previous correspondence, adding that the new government does not seem to have any economic plan or any solution for the country's economic problems.
Speaking about the group's plan about the country's economy. Raghfar said: "Based on our calculations we can supply the essential needs of the population with $35 billion. We do not need to allocate foreign currency to the production of tomato paste or carpets. Previous governments have authorized the activity of 160 motorcycle manufacturing factories that consume foreign exchange but do not produce any added value. During the war in the 80s Iran had $7 billion revenue in foreign exchange. We spent $3 billion on the people's essential needs and $4 billion on the war and the society could function properly."
He added: "Today, decision makers have their own interests rather than protecting the people's rights. For years we have been giving billions of dollars to import oil seeds and no one asked why we do not produce this. "
However, Raghfar failed to mention that Iran’s total annual oil revenues is $35 billion and if it is all spent to provide daily necessities, there will be nothing left for investments.
Raghfar added: "What we call financial corruption is in fact plundering of the people's wealth. Controlling corruption is not an economic matter. The government is responsible for stopping it."
Meanwhile, Farshad Momeni, another institutionalist economist has warned the president that "If Pezeshkian continues to behave in the same way he has done so far, his government will end up with the same fate as the Raisi administration. Mr. Pezeshkian must make a strategic choice. Either he wants to make the economic intermediaries and profiteers fatter, or he should prioritize the housing, nutrition, education and health of the poor people."
Araghchi, born in Tehran in 1962, earned his PhD in Political Science from the University of Kent in the UK.
Araghchi, who, like many Iranian officials, views former IRGC commander Qasem Soleimani as "Iran’s role model" and Hezbollah’s Hassan Nasrallah as "Lebanon’s role model," joined Iran’s Revolutionary Guards (IRGC) in the early days of the revolution in 1979.
In a 2013 interview with Panjereh, a weekly publication aligned with the IRGC, Araghchi reminisced about his time as a Revolutionary Guard, saying, "My heart remains with them, and I have carefully preserved the sacred uniforms from those days."
He also described Ali Khamenei as "our everything," and stated, "For me, he transcends the roles of leader and Supreme Leader; in a word, he is 'Agha' (Sire)."
Araghchi has one daughter and two sons. In the same interview, he mentioned that his son-in-law is a cleric, adding, "To me, the clerical robe is sacred; it embodies virtue and is without flaw."
In 1989, after his service with the IRGC, Araghchi worked as a diplomat in Saudi Arabia. In 1999, Araghchi was appointed as Iran's ambassador to Finland. He later served as Iran's ambassador to Japan from 2007 to 2011. Following his tenure in Japan, Araghchi returned to Iran, where he took on the role of Deputy for Asia at the Ministry of Foreign Affairs and briefly served as the ministry's spokesperson.
Role in foreign ministry during President Rouhani’s administration
Araghchi served as deputy to Foreign Minister Mohammad Javad Zarif during Hassan Rouhani's administration, playing a pivotal role in the negotiations that led to the 2015 JCPOA nuclear deal. His involvement in the talks alongside Zarif brought Araghchi widespread recognition.
However, his experience in Iran's nuclear negotiations extended back to the tenures of Ali Larijani and Saeed Jalili as secretaries of the Supreme National Security Council. During the JCPOA negotiations, many viewed him as Khamenei's trusted representative on the nuclear team—a belief later validated by his subsequent appointments.
In the final days of Rouhani’s government in 2021, Araghchi, as head of the nuclear negotiation team, traveled to Vienna to lead talks on reviving the JCPOA with the Biden administration. However, the negotiations failed to produce any results, with Rouhani and Zarif attributing the failure to domestic sabotage and parliamentary interference.
When Ebrahim Raisi's administration took over, all members of Zarif's team were dismissed. However, Araghchi was appointed as the Secretary of the Strategic Council on Foreign Relations, a position he still holds today. The Strategic Council on Foreign Relations, established in 2006 by order of the Supreme Leader, has its members appointed directly by Khamenei.
Kamal Kharazi, head of the council, stated in October 2021, "The Leader's view on Abbas Araghchi was that he should be utilized within the council, leading to his appointment as secretary."
Under Raisi's administration, Iran’s acting foreign minister, Ali Bagheri-Kani, a close associate of hardliner politician Saeed Jalili, assumed the role of chief negotiator with the West. Bagheri-Kani was reported to have adhered to Jalili's negotiation strategies, which ultimately failed to produce any agreements. In 2013, Araghchi remarked on Bagheri-Kani, saying, "We differed in our negotiation approaches, but I had, and still have, great respect for him."
Family controversies and nephew’s corruption scandal
During his tenure as Deputy Minister of Foreign Affairs under President Hassan Rouhani, Abbas Araghchi was indirectly involved in a corruption case.
His nephew, Ahmad Araghchi, appointed as Deputy for Foreign Exchange at the Central Bank in August 2017, was arrested in August 2018 on charges related to a foreign currency exchange corruption case.
At the time, conservative media outlets criticized Ahmad Araghchi’s appointment at the Central Bank as an example of "nepotism and family favoritism."
Gholamhossein Mohseni Ejei, the judiciary spokesperson at the time, accused Ahmad Araghchi of "disrupting the country’s economic, foreign exchange, and monetary system."
Ahmad Araghchi was released on bail two months after his arrest, but his legal ordeal continued. Initially, Tehran's Revolutionary Court sentenced him to eight years in prison as the case’s second defendant. However, the Supreme Court later overturned this sentence, reducing his sentence to fines, while the prison sentences of most other defendants were upheld.
Opposition to Iran’s Woman Life Freedom protests
During Iran’s "Woman, Life, Freedom" nationwide uprising, which spurred large-scale protests by the Iranian diaspora in support of demonstrators inside Iran, Abbas Araghchi, Secretary of the Strategic Council on Foreign Relations, stated, "We should not allow protests to be constantly held against us…Although I believe the Islamic Republic is stronger than this and won’t be shaken by these winds, we still must ensure that the damage does not escalate."
The new president’s prayer leader
With Masoud Pezeshkian’s confirmation as a presidential candidate, Araghchi, along with other former members of Rouhani’s government, threw his support behind him.
On June 8, 2024, during the election campaign, a photo emerged from Pezeshkian's campaign headquarters showing him and Zarif praying behind Araghchi. This image energized Pezeshkian's supporters and positioned Araghchi as the leading candidate for Minister of Foreign Affairs in the upcoming administration.
Now, with Pezeshkian’s presidency underway, Araghchi is poised to potentially return to the top position at the Ministry of Foreign Affairs. It is expected that he will face some tough opposition in parliament for his role in the nuclear deal, but if Khamenei has already agreed to his candidacy, he will eventually receive a vote of confidance.
Pezeshkian's administration, which pledged to reduce tensions in foreign policy, faced an immediate crisis when Ismail Haniyeh, the leader of Hamas, was assassinated in Tehran just one day after the inauguration.
The killing of Haniyeh and the possibility of Iranian retaliation against Israel could shift the primary issue on Araghchi’s desk from reviving the JCPOA to addressing regional conflict.
Zarif revealed that of the 19 ministers introduced, only three were the first choices recommended by the steering committee responsible for candidate selection. He noted that ten of the proposed ministers were not on the council's list at all.
Zarif's resignation underscores his frustration with the process, lamenting that he was unable to implement the expert opinions of the committees formed to find the best possible candidates or fulfill his promises to include women, youth, and ethnic groups in the cabinet.
"I am not satisfied with the outcome of my work and I am ashamed that I could not achieve the expert opinion of the committees and the inclusion of women, youth, and ethnic groups as I had pledged," Zarif stated in his post. He further announced his intent to return to academia, apologizing to the Iranian people for his inability to navigate the complexities of domestic politics.
Zarif’s resignation has intensified scrutiny and criticism of Pezeshkian's cabinet choices. Azar Mansouri, head of the Reform Front, also condemned the proposed cabinet, remarking that "One should not expect miracles from this government, especially considering that more than 80% of the country's power is in the hands of other entities."
Pezeshkian’s cabinet: old faces, old problems
Pezeshkian's list of proposed ministers, sent to Parliament for approval, has drawn criticism for being a step backward. The cabinet, with an average age of 59.7 years, contradicts Pezeshkian’s earlier promise that 60% of the ministers would be under 50. In reality, only two ministers fall into this category, leading to widespread disappointment among those who expected a younger, more dynamic government.
Abbas Araghchi, introduced as the Minister of Foreign Affairs, served as the deputy to Zarif during Hassan Rouhani's presidency, playing a key role in the nuclear negotiations with the West. Meanwhile, Esmail Khatib, nominated as the Minister of Intelligence, has a negative record, including the explosion in Kerman on the death anniversary of former IRGC commander Qasem Soleimani in January, which resulted in hundreds of casualties, as well as the assassination of Hamas leader Ismail Haniyeh in Tehran.
The inclusion of figures like Abdolnaser Hemmati, former Central Bank head and 2021 presidential candidate, as Minister of Economy, further underscores the lack of new blood in the cabinet.
According to an investigation by Iran International, 11 of Pezeshkian’s proposed ministers have previously served in the administrations of Raisi and Rouhani. This recycling of political figures suggests a continuation of the same policies that have led Iran into its current state of crisis.
Alireza Kazemi, proposed as the Minister of Education, is another controversial choice. Kazemi, the brother of the IRGC Intelligence Chief, has a background in seminary teaching and drug control, raising concerns about his relevance to the education ministry.
Reformist discontent and Khamenei’s influence
The proposed cabinet has drawn sharp criticism from reformists, who are dismayed by the inclusion of several conservative ministers from the Raisi administration.
Rahmatollah Bigdeli, a member of the Government’s Strategic Council, pointed out that the most important ministries have been handed over to 'Principlists,' indicating a consolidation of hardline power.
Political activist Abdollah Ramezanzadeh criticized the nomination of Eskandar Momeni as Minister of the Interior, stating, "The worst periods for the Ministry of Interior in the past 46 years have been when military personnel were in charge." This sentiment reflects broader concerns about the increasing militarization of Iran’s government.
Political analyst Reza Alijani highlighted the pervasive influence of Supreme Leader Ali Khamenei over the selection of ministers, noting that the Ministry of Interior, Ministry of Intelligence, and Ministry of Foreign Affairs are all critical points that Khamenei has secured for his loyalists. This observation underscores the limited autonomy Pezeshkian has in forming his government, with Khamenei’s shadow looming large over the process.
A cabinet under fire
The discontent surrounding Pezeshkian’s cabinet is palpable. Reformists are particularly upset by the absence of Sunni representation and the inclusion of only one woman among the proposed ministers.
Political activist Ahmad Zeidabadi pointed out that the cabinet "has two or three fundamental flaws," but if Pezeshkian believes he can work with these choices, "there is no reason for us to be more royalist than the king."
Pro-reform activist and former MP Parvaneh Salahshouri was even more direct, writing on X that Pezeshkian "has failed his first test except in a few cases." This sentiment was echoed by other reformist activists, who had warned Pezeshkian before the cabinet announcement that his selections were problematic.
Javad Emam, spokesperson for the Reform Front, criticized the continued dominance of military and paramilitary forces in Iranian politics, questioning the point of holding elections if the outcome remains unchanged.
"Ultimately, the President is responsible for his cabinet, and no lobbyist or imposing figure will take responsibility for the government. So, while there is time, reconsider," Emam urged Pezeshkian.
Even Shahram Dabiri, Pezeshkian’s Parliamentary Deputy, acknowledged the influence of Khamenei in the cabinet formation, writing on X that Pezeshkian had clearly stated that the cabinet members would be selected with Khamenei's opinion and approval.
A government of crisis
Political analyst Rouhollah Rahimpour summed up the situation by stating that Pezeshkian is starting his government with three major crises: political-security, social, and regional. The challenges facing this new administration are immense, and with a cabinet that appears to be more of the same rather than a harbinger of change, the prospects for meaningful reform in Iran look increasingly bleak.
