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Iran by the Numbers

By THOMAS L. FRIEDMAN

June 23, 2002

The New York Times

Tehran, Iran

The most striking thing about Iran today is the honesty you can find in the newspapers. Some mornings, they take your breath away. Consider the mainstream paper Entekhab, which ran a long piece the other day, headlined "Skyrocketing Figures," that ticked off the following statistics: There are now 84,000 prostitutes operating on the streets of Tehran and 250 brothels, including some linked to high officials. There are 60 new runaway girls hitting Tehran's streets every day — a 12 percent increase over last year. Forty percent of all drug-addicted women in Iranian prisons have AIDS. Two sisters, ages 16 and 17, recently gave AIDS to 1,100 people in a two-month period. Four million youths under the age of 20 suffer from depression. Unemployment (which is already around 30 percent) is steadily rising.

All of these problems are symptoms of a floundering economy, or, as the newspaper Iran News baldly put it two weeks ago: "The nation's entire economic structure is fundamentally bankrupt and in desperate need of urgent and sweeping reforms. Some of the graver and more prominent problems include lack of sufficient foreign investment, mismanagement in all tiers of our economic system, political isolation leading to [a] deteriorating economic situation, atrocious unemployment [and] high inflation."

This deterioration is not primarily the result of U.S. sanctions. Iran has plenty of oil wealth and can buy anything from Europe or the black market. It is primarily the result of mismanagement by Iran's theocratic rulers — their corruption, incompetence, arbitrary decisions, religious legal codes and antiglobalization instincts. Which is why the biggest internal drama playing out in Iran today is this: Will the ayatollahs peacefully reform their system, or will it explode beneath their feet from social unrest?

In a poll published by the Noruz newspaper last month, 6.2 percent of those surveyed in Tehran said they were satisfied with the current state of affairs, 48.9 percent favored "reform" and 44.9 percent favored "fundamental change."

The problem for Iran's ruling clerics is that they cannot provide enough new jobs without privatizing their state-dominated economy and attracting foreign investment. And they cannot reform the economy and attract foreign investors, who will bring new technology and new markets, without reforming every pillar of their ruling system. This system includes vast monopolies awarded to their allies — the bazaar merchants, clerics and children of the clergy — as well as Islamic charities that serve as front organizations for huge business conglomerates that pay no taxes and import everything from cigarettes to cars, duty-free. Iran also can't attract investors, particularly for industry, without some transparent rule of law, which means curbing the arbitrary rule of the Guardian Council of clerics and the judges they appoint, who sit atop the system here, dominating the courts and parliament.

The Islamic revolution urbanized millions of rural Iranians and made them real citizens, in a way the shah never did. "Now they have education, roads, transports and health facilities," said the manager of an auto-parts company. "Sixty percent of university students today are girls. But now these new citizens are looking for a citizens' regime, not a rural regime. A citizens' regime is a secular government, which respects the religion of the people but also the rights of the people."

For the moment, the ruling clerics have enough oil money — and enough support in the rural areas, in their seminaries and in the bazaar — to stay on top. But given Iran's soaring population — there were 30 million Iranians when the shah left 23 years ago, and there are 66 million today, with 70 percent under age 30 — something will have to give if Iran hopes to create enough jobs.

"The establishment has two choices," said the opposition economist Rahim Oskui, "but they have the same result: either the establishment will resist international and national changes — in that case it will crash — or it will become flexible and adapt. But in that case it cannot remain what it is now. . . . [My feeling is] the clergy will reach the conclusion that they will have to secularize the system in order to survive, but this will take time. . . . All our modern revolutions came from inside the country, and given the level of demands inside the society today, a backward establishment like we have now cannot resist these forces forever — provided there is no outside interference."