by Michael Rubin
As markets floundered amid the credit crunch,
The Iranian leadership may rue their words. Ahmadinejad has run
Parliamentarians and journalists might complain but, as the Islamic Republic reverts to a Soviet-style command economy, regime intolerance toward technocratic expertise grows. Hojjat al-Eslam Ha'eri Shirazi, the Supreme Leader's personal representative in the city of
Non-oil sector production is stagnant. Factories may remain open but many do not pay workers. On Oct. 2, for example, tire factory workers staged a protest in front of the Ministry of Labor seeking six months' unpaid wages. In recent weeks, wild cat strikes have occurred in
To mitigate such trends, the government has imposed price controls. On June 11, the daily Resalat reported that the paramilitary Basij, a subdivision of the Islamic Revolutionary Guard Corps, would enforce low prices. Over subsequent days, the Iranian press featured photos of Basij beating merchants whose prices were too high.
The combination of high liquidity, sparked by Ahmadinejad's arbitrary decree lowering interest rates to single digits, no-interest banking and inflation has led wealthy Iranians to pour money into real estate. Housing costs have skyrocketed;
To fight economic malaise, Ahmadinejad has raided
He will need to continue spending. Last winter,
As oil prices plummet, Iranian pessimism grows. In 2006,
On Oct. 7,
Such strategies are wrong. Throwing an economic lifeline to a terror-sponsoring regime dedicated to the acquisition of nuclear weapons capability would be nothing short of diplomatic malpractice on a Carter-esque scale. Not only has the Islamic Republic squandered billions on nuclear weapons, destabilizing
Michael Rubin, editor of the Middle East Quarterly, is a resident scholar at the American Enterprise Institute
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