Iran: Don't Bank On It


August 17, 2007: The threats to the government are many, varied and growing. Arrests of trade union leaders are on the increase. Strikes are considered un-Islamic, and a threat to the clerical dictatorship. But the unions are striking, demonstrating and agitating anyhow. The reason is the growing poverty. The government admits that eleven percent of Iran's 71 million people live in poverty, and the actual figure is believed larger because the government has been fudging economic statistics (especially the inflation rate, which is probably over 20 percent a year, not the 17 percent the government claims.) The government just fired the ministers most responsible (those of Oil and Industry), and refuses to make any basic changes. The firings quickly resulted in criticism from senior religious officials, revealing splits in the government. Despite the high price of oil, much of the government income goes to keeping itself in power. That means lots of money for the ten percent of the population that benefits from the religious dictatorship. Most annoying to Iranians are the billions spent on Syria and Lebanon.

American threats to list the Iranian Revolutionary Guard Corps (IRGC) as a terrorist organization recognizes the fact that the IRGC is more than just the "royal guard" of the Iranian dictatorship. Originally founded to do the clerics dirty work, and keep an eye on the Iranian armed forces, and population in general, the IRGC has grown to become a state-within-a-state. The IRGC not only has 150,000 armed members, but also controls billions of dollars worth of businesses inside Iran, and runs numerous terrorist operations outside the country. The IRGC has not been shy about its foreign activities, and boasts of its efforts to destroy Israel and the United States. The IRGC scoffed at the American threat, but those sanctions have real bite. The U.S. has enormous control over the international banking system, and has developed ways to use this power. Once the United States tells the world's banks that they will be cut off from access to the U.S. banking system if they do business with the IRGC, the Iranians suddenly find that many of their criminal activities are much more difficult, if not impossible, to carry out. IRGC bank accounts are frozen, and some assets are seized. The American sanctions would be accompanied by U.S. government officials detailing IRGC crimes, and abuse of the international banking system. This tends to convince many, if not most, major international banks that it was not worth the trouble, and risk, to do business with the IRGC. This makes it more expensive and expensive for the IRGC to operate. It's also very embarrassing, if only because sanctions also identify IRGC leaders that are to be denied the right to travel to many parts of the world. The listing, and the sanctions, would also interfere with Irans nuclear weapons program, which is largely controlled by the IRGC.

On one front, the government is having some success. A network of drug gangs was busted, and nearly two tons of drugs (mostly opium) was seized. Iran has several million addicts, and the number is growing. The druggies form a criminal underground that doesn't threaten the government, but does annoy the hell out of the population. To most Iranians, the out-of-control drug gangs are seen as just another example of the incompetence of the clerical dictatorship. The police have been unusually active of late. Two Belgian tourists were kidnapped by Baluchi bandits in the southeast, and the jailed brother of the bandit leader was demanded in return for the foreigners. But the police quickly obtained the release of the captives. Around the same time, two Chinese citizens were arrested as spies, despite Iran's dependence on China for weapons and military technology. No one is sure what to make of that.




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