Political+and+Economic+Change

By: Jonathan Yu

Background
In the early 1950s, Iranian Prime Minister, Mohammad Mosaddegh, nationalized the oil industry which angered the US and British. To counter Mosaddegh, the British and US staged a coup d'etat and put the shah, the Iranian equivalent of a king, back into power. Shah, Mohammad Reza Pahlavi, was placed into power, and his views were sympathetic to British and US interests.



However, while the Shah's views were sympathetic to the West, his nation's views were quite different. The shah was unpopular with his people, and also began to develop a more authoritarian type of rule. The disliked regime was viewed as corrupt, extravagant, and oppressive. This coupled with the failed economic plans of the regime, which led to shortages and inflation all contributed to the downfall of the Shah.- Ayatollah Khomeini, an outspoken critic of the Shah, was previously exiled by Iran, but he began to take on more of a leadership role. Khomeini began formulating his own political philosophies, which were decidedly anti-West and very nationalistic Iran. His slogan was "Neither East, nor West – Islamic Republic!".

Revolution
On January 16 1979, the Shah leaves Iran, but the situation had deteriorated. The public was in revolt against the Shah, and on February, Ayatollah Khomeini returned from exile. Khomeini took power and installed the government that is still in power today. media type="youtube" key="QK9-6jsjxvM" height="315" width="420" media type="youtube" key="PSbsUZeL5dU" height="315" width="420" .

A Sad Day in Our History
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Impact
Islam became viewed more sympathetically and antagonistically Political instability in Iran led to the Iran-Iraq War Iranian hostage crisis strained Iran-US relations Surge of Islamic beliefs in Middle Eastern nations Created theocratic government in Iran Men > Women

The recent elections of 2009 showed the world that while Iran can remain highly oppressed, the people of Iran can certainly rise up and protest. With the rise in social networking and the internet and their obvious effects on Arab Spring, Iran can not remained excluded from the list of countries who's leaders are completely safe from rebellion. Also, as shown in Iran's history, if a new, viable leader emerges as Ayatollah Khomeini did, there could very well be a regime change in Iran. While Ahmadinejad and Ayatollah Khameini still hold power right now in Iran, should the will of the people change, there will either be drastic changes in the Iranian government or a entirely new government will emerge.
 * Analysis**

=Economy= When the Shah was still in power in the 1960s, he launched a far reaching reform program including land, infrastructure, and industry. While there was economic growth, the policies alienated the people of Iran, and inflation among other problems created grievances against the Shah, creating a situation where Khomeini could return to take power. When Ayatollah Khomeini first took power, there was economic conservatism. Khomeini was a strong advocate for property rights and the private sector. However, labor strikes and emigration crippled the Iranian economy and US sanctions froze another $11 billion of Iranian assets. Also with the Iran-Iraq War, crucial funds were diverted to the war, further hurting the Iranian economy.

Rafsanjai
In 1989,a cease-fire and Khomeini's death, marked a drastic shift in the economic policy of Iran. President Akbar Hashemi Rafsanjani sought out new economic reforms to fix the country's problems. Rafasanjai's plan included the following provisions
 * 1) Develop the Iranian infrastructure
 * 2) Privatize state enterprises
 * 3) Liberalize foreign exchanges
 * 4) Establish free trade zones
 * 5) Eliminate subsidies and price controls

There was strong growth initially, but after political miscalculations and tensions in the Middle East, the growth stalled. Again there was inflation, sanctions, soft oil prices, and the uncertainty deterred possible foreign investors. While Rafasanjai's plan was successful initially, by the end, it accomplished little for Iran's economy.

Khatami
The next president, Mohammad Khatami, had his own set of economic principles and provisions to jump start the Iranian economy. Khatami faced a global recession,slump in oil prices, inflation, unemployment, and mismanagement of funds during his term in office. Despite the hardships, Khatami has a lenghty list of accomplishments While Khatami was successful, they failed to build public support for their economic agenda which led to him being ousted in 2005, for the current president.
 * 1) Unified the exchanged rate
 * 2) Established Oil Stabilization Fund to protect from market volatility
 * 3) Authorizing first private banks after the Revolution
 * 4) Improvements in framework for foreign investments
 * 5) Luring interest and investments from the West

Ahmadinejad
Ahmadinejad emphasized populist economics-distribute all oil revenues to the population. He received some lucky breaks-oil prices grew substantially, Asia was becoming much stronger economically, enough to offset US sanctions. China has become one of Iran's biggest importers. Ahmadinejad's economic actions include The economy has not been the most successful under Ahmadinejad, one possible reason the 2009 elections focused heavily on the Iranian economy. media type="youtube" key="Xd9BlpR759A" height="315" width="560" media type="youtube" key="OkEe--lAfLo" width="425" height="350"
 * 1) Expanding credit
 * 2) Public feuds with cabinet ministers and Central Bank chiefs
 * 3) Getting rid of the planned bureaucracy
 * 4) Weakening government technocrats
 * 5) Enjoying the global economic crisis

Economic Stats (IMF projections from 2011)
Gross Domestic Product (GDP) $353.7 billion Real GDP growth 3% Unemployment 9.8% Inflation (average CPI) 10.3% Current account balance $8.6 billion Exports $92.9 billion Imports $85.2 billion Current account balance $8.6 billion External debt $14.2 billion Oil revenues $64.4 billion Oil production 3.7 million barrels per day (bpd)

The Future
Uncertainty in leadership is the primary one-hurt/ameliorate relations with other nations Declining production in oil could severely hurt Iran's economy Government needs to lure back foreign investors to continue growth

While the US sanctions have continually been hurting the Iranian economy and stopping it from reaching the maximum potential it can, the Iranian economy is a growing one. Since the tumultuous 2009 elections, the Iranian economy has been growing fairly rapidly. The International Monetary Fund, IMF, has announced that Iran's economy will continue to grow, the inflation rate has decreased, and the Iranian government has earned $60 billion dollars from cutting subsidies on oil. Iran's economic reforms seem to working now, and depending on the relationships of Khameini and Ahmadinejad and which economic policies they wish to pursue, Iran's economy can still grow. Iran has many natural resources, including oil, which it can learn on, and if US sanctions are ever lifted, that would also be another boon for the Iranian economy.
 * Analysis**

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