Transcript: Q&A

Domestic Dynamics and Foreign Policy: Transition or Trauma in ?

Professor Abbas Milani

Hamid and Christina Moghadam Director of Iranian Studies,

Chair: Sharan Tabari

Senior Adviser, Legatum Institute

27 November 2014

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Question 1

I have two questions, if I may. The first one: you said about the comments that are actually undermining the Rouhani government and his foreign minister in trying to reach a deal. Are they going to prevail, these comments and these people, like the Revolutionary Guards? My second one is: are the Iranian people actually aware of what this regime is doing to them as far as creating enemies of all the countries around them? As you know, the Iranian regime is interfering in Lebanon, in Yemen, in Bahrain, in Kuwait – everywhere they can basically, trying to be a superpower of the area. Are the Iranian people in accord with this? Is this what the Iranian people really want? What are they being told?

Abbas Milani

Whether they will prevail or not, I think remains to be seen. But I think it is now an open confrontation between Zarif and Rouhani on the one hand and many elements of the IRGC on the other hand. If you collect some of the comments that they have made in the last week alone, it is a virtual political civil war. They are openly attacking one another in ways that I would have thought unimaginable, particularly at a time where they are trying to give the appearance of a coherent, unified policy.

I think the problem Mr Khamenei has is he has, by all accounts, given Rouhani and Zarif the opportunity to reach a nuclear deal with the west that has two characteristics. One, it can't appear to be a losing proposition. It can't appear that they're giving in too much, because Mr Khamenei has put virtually all of his political capital behind this nuclear programme. To now say we were forced to back down, to now say that out of desperation we have to make this agreement, would be for him untenable. So he wants a deal that he can sell to the base at home as a win, at least a win-win if not an outright win.

Secondly, he wants a deal that does not allow Rouhani, Rafsanjani and the reformist camps to use and leverage to change the domestic dynamics of Iran. He wants to keep power as he has. He wants to keep power with the help of the parts of the IRGC that he has, with the help of the Basij that he has, and not open society, not bring in the reformists, not bring in the other forces that need, I think, to be brought in.

I'm not sure it's going to work. I'm not sure they're going to solve the economic problems. Iran has profound economic problems that can only be solved with a massive infusion of capital. Mr Rouhani came to New York, they invited some of the most successful Iranian businessmen to try to meet with him. Twenty of them did agree to meet with him but they virtually told him the same thing: that unless you get the rule of , unless you get the IRGC out of the business of having sweetheart deals, unless there is some resolution of the women's issues, we are not going to bring in this capital. The Iranian diaspora is a profoundly rich diaspora.

So on your second question, it's very hard to have good surveys of opinion in Iran, so much of what we say is anecdotal. Certainly what I say is anecdotal. But I think the Iranian people are aware of what has happened to them. They are aware of the costs. All you have to do is read the jokes, go online and read some of the commentaries. Go and read some of the commentaries that people like Rafsanjani and Rouhani have been saying. Some of those comments are really remarkable in the context. When Rafsanjani comes out and says the people who brought Ahmadinejad and forced him on us for eight years, why don't they come and explain themselves and apologize – everybody in Iran knows who 'they' are. Ahmadinejad came to power with the direct support of Mr Khamenei and stayed in power with the 3 Domestic Dynamics and Foreign Policy: Q&A

support of Mr Khamenei. Now everyone is talking about what a wreckage of an economy he has left behind, but no one seems to take responsibility.

So people read these things. But people don't want Iran to become Libya, they don't want Iran to become Syria. They want to change, as I said, they want to change the regime without having a regime change, because they know this regime has 7 or 8 million; of those, a few hundred thousand are very dedicated, willing to kill and die for the cause, because they are sitting on $70 or 80 billion a year income, about which they give accounting to no one. So this is not going to be an easy fight, to get out of this to where Iran wants to be, I think.

Question 2

It's a very promising picture of Iran's future that you paint, but I suppose if in the 1980s we'd been looking at Iraq and looking at the middle class growing in Iraq and the economy relatively prosperous, we might have had a similar prediction there. If there are many more years of sanctions and, as you say, the economy of resistance, isn't there the danger that the education sector will suffer, that future generations will actually be much less educated and perhaps less sophisticated than the present?

Abbas Milani

I absolutely agree. If there are more sanctions, if the economy of resistance (so-called) continues, you are going to have a very long, hot summer in Iran. I think the regime knows that. I think many people, by all accounts, have gone to Khamenei before the Rouhani election. We know a delegation from the bazaar went. We know some of the economists went, some of the economists he trusts. And they told him that the bottom is falling out, that the Iranian currency had lost something like 60 per cent of its value. As one economist says, Iran was the only economy in the world to have 42 consecutive years of double-digit inflation. It has now double-digit unemployment. It has a stagnation unlike anything Iran has ever experienced. It has a declining share of the oil market. It is unwilling to enter into the European gas market because it's afraid of what Russia might do in the nuclear deals if it tries to undercut Russia's monopoly of the European market. If Iran was pursuing a policy that sought Iran's national interests in a most rational way, Iran might very well be interested in trying to get into the gas market in Europe right now, but they have openly said they're not going to do it because they don't want Mr Putin angry at them.

So my optimism is based on my notion, my surmise, that the status quo – both in terms of this rather strict authoritarianism that is incommensurate with the reality at the bottom, and the current economic reality – will not continue, that something else will.

Question 3

I was just wondering, taking into account where Iranian society is headed, how do you foresee foreign policy towards Israel?

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Abbas Milani

Foreign policy towards Israel will depend on who gets the upper hand in Iran. If Mr Khamenei continues to have the kind of role that he's been having, it's going to be very hard to imagine a change. If anything, he has radicalized his position against Israel. He is now more openly challenging Israel. He is clearly laying out a map. Yesterday he said it's inexorable: the West Bank is going to be armed to the teeth, the same way the Gaza Strip is. So I see that as very difficult to change.

But what doesn't help the change process is that Israel too, under Mr Netanyahu, has a very intransigent attitude. The notion that Iran must have zero enrichment at this time is a non-starter. By taking that kind of a position, by taking that kind of a radical position, I think Israel plays into the hands of the anti-Israeli rhetoric in Iran, saying the only country that is singling out Iran for this kind of exceptionalism is Israel.

Question 4

Is there a possibility that the deal between Iran and the west will go vice versa? Which means that more power for the regime, more controlling of the region, more playing with the cards of politics, starting from the Mediterranean to the Indian sea? What about ISIS? There are so many talks about there is a contribution of the regime with ISIS and so on. Is ISIS a threat or not?

Abbas Milani

First of all, I think it's clear that ISIS is a threat. ISIS is about 90 miles from the border of Iran and ISIS' stated policy is that killing Shi'ites is doing God's work on earth. So they are a kind of a beast that has come out of a bottle and it's going to take a lot of wise men and women to get this genie back into the bottle. For Iran, it is a serious threat.

In a sense, Iran has played a role, as has Saudi Arabia, in creating ISIS. Saudi Arabia by directly helping, Iran by arming the Syrian regime and creating the kind of civil war and the kind of chaos – the chaos that was created, in my view, when the Obama administration failed to have a clear policy. So everybody has had a role in creating this. But Iran is certainly worried. Iran might not admit that they're worried. Iran keeps saying that if ISIS has been stopped at all, it's because Mr Suleimani and 70 of his men have gone to Iraq and stopped the march of ISIS. Which is a joke, I think. They are now 80 miles out of Baghdad. If they take Ramadi, Baghdad airport might well be the next place they land. They now seem to have surface-to-air missiles.

So I think ISIS is a concern to them but they don't want to admit it. They don't want to admit that the US and allies involvement is helping with the cause, is inadvertently helping their ally in Syria. Mr Assad has been the beneficiary of ISIS. To me, Assad too had something to do in the creation of ISIS. If you look at how ISIS was selling $2 million worth of oil a day, and Assad had complete command of the air, and they never attacked their oil facilities. Why? Because I think Assad's design was to tell the world that it's either me or ISIS, which is the same card his dad played.

It is possible, if the deal with the west is made, the regime will use it to consolidate. That's what Khamenei wants to do. That's why Khamenei insists, as I said, on a deal where he can maintain control, the IRGC can maintain control. But whether they can in fact do this remains to be seen. 5 Domestic Dynamics and Foreign Policy: Q&A

If Rouhani brings in a deal, then his hand is strengthened considerably. He is a cautious man but he's also a profoundly ambitious man. If you look at his website, go to Aftab News and look at the site, you see Mr Rouhani in a truly remarkable way. There is a picture of him looking in one direction and then there is a very large picture behind him, of himself, looking the other way. The Rouhani president is looking at tomorrow; the Rouhani super-ego is looking at the future.

One of the things that we have to take into account is that what is going on in Iran today is already the battle for the post-Khamenei era. Khamenei is clearly sick. They kept Mr Kani alive literally for six months because they wanted to make the necessary arrangements for the leadership of the Council of Experts, for managing some of his financial affairs. Now, clearly there is the candidacy of Ayatollah Shahroudi as a possible successor. Rafsanjani is a possible successor. The battle for who and what will succeed Mr Khamenei has already begun, and that's a very important part of the future dynamics.

Question 5

In the event of a comprehensive deal, Iran and the US will go back home and sell the deal to their constituencies. How do you believe Iran will sell the deal to Saudi Arabia, considering that the US will be consulting Saudi Arabia prior to the deal, as they did during the weekend, not to mention Israel.

Abbas Milani

I don't think they will sell it. I anticipate fully that if a deal is reached, you will very soon see enrichment programmes in Saudi Arabia. They have openly announced that they will start an enrichment programme in Saudi Arabia. The United Arab Emirates has already signed agreements to have enrichment programmes. You are going to have an enrichment battle in the region.

My belief is that if Iran really wanted a nuclear programme that was for peaceful purposes, they should have from the Shah's period decided on a different path. I wrote an article with Sig Hecker, who was the head of Los Alamos and knows more about nuclear energy than I think anybody, and nuclear weapons. Our argument was that if Iran didn't want to have the breakout capacity as a bet, it should have gone a different way. It should have gone where South Korea went. South Korea is now a major nuclear industrial player. Iran has been losing money for what seems to be very little gain.

So if Iran goes there, if the deal is done the way I think it will be done – a few thousand centrifuges, Arak refashioned, much of the 20 per cent out of Iran, a lower 5 per cent (the outlines of such a deal) – I would be very surprised if Saudi Arabia doesn't go that way. You have to also remember that Saudi Arabia already has a hedge in nuclear weapons, in Pakistan. As one of my friends said, some of the nukes in Pakistan have already written on them 'Made for Saudi Arabia'.

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Question 6

I have two questions. One is concerning the youth – you talk about very sophisticated methods of opposing the regime, if you could tell us a little bit more about it. Number two is concerning the Guards, if you can tell us a little bit more about the divisions – whom they back, and maybe the numbers.

Abbas Milani

The youth are remarkable in challenging the regime in every facet of everyday life, from aesthetics to sexual politics. According to the Iranian government's own survey, 80 per cent of high school students in have admitted having multiple sexual partners before they leave high school. That is not Islamic as understood by Ayatollah Khamenei. That is as far away from that as you can imagine. In my generation, the idea of people in high school even talking to a girl was deemed to be revolutionary. Now to have multiple partners – the women celebrating the worst, having the worst parties in Tehran right now. Fifty per cent of marriages end in divorce. One side of it is tragedy, another side of it is women taking their lives into their own hands. Forty-five million internet users. Iran has one of the slowest internets in the world but also Iran is one of the most active. In other words, they defy it, they find ways to go around the regime's very stringent censoring mechanisms and control mechanisms.

So from everyday living to using the death of a virtually obscure pop singer – Mr Pashaei died. I had never heard of Mr Pashaei's name and I suspect many Iranians had never heard of him, but suddenly when he was dying in his hospital bed, several thousand people showed up at the hospital and began reciting his songs. Then when he passed, several hundred thousand people showed up for his funeral. Compare that to the funeral that the regime tried to make for Mr Kani. The regime brought all of its forces, all of its mobilizing, and it was a paltry event compared to what people spontaneously did in order to celebrate a fairly less than sterling pop singer.

Last night I was giving a talk at SOAS. I gave two examples of how people are fighting the status quo. Iran has two major Shi'ite centres of learning: Qom and Mashhad. Mashhad is the centre of underground rap music in Iran. Rap music! And Qom has become one of the more remarkable places for celebrating Valentine's. Two days before Valentine's, they ran out of Valentine cards and gifts in the city of Qom. If you had told me this 30 years ago, I would have thought you are from Mars and you had never been to Qom. Qom was one of the most conservative towns, now they celebrate Valentine's.

Look at the way the grandchildren of Ayatollah Khomeini live. Look at the way they dress. Look at the granddaughter of Ayatollah Khomeini getting a prize in science in Canada. Look at the way she was dressed and compare it with what the notion of a young lady from a pious family was supposed to look like. So they do it in every way. Women do it by going to college, women do it by insisting on being part of the labour force.

On the eve of the revolution, there was at best two or three women publishers in Iran. There are now 700. It's unimaginable for me. Iran publishes 65,000 titles a year. In the year of the revolution, the number of titles published was 1,100. Now, 35,000 of it is probably religious books, subsidized by the regime. Even take 50,000 of it to be subsidized by the regime, there are 15,000 other books. The number of new titles in the United States is about 11,000. The realities in Iran, at the sort of cellular level, are very different than the image at the top. 7 Domestic Dynamics and Foreign Policy: Q&A

Oh, the Guards – that was the difficult one, I decided to forget it. I certainly don't have any numbers on how many people support, because it is a very difficult thing to get a handle on. But if you look at the number of sites that the IRGC has and you look at the number of IRGC commanders who are now in different positions within the government, who have very different approaches than the current commander of the IRGC has – he has a very hardline attitude, he has a very critical attitude towards Rouhani and has been making fun of Rouhani. He's been saying that Rouhani and Zarif are clumsy and have embarrassed Iran, they have degraded Iran. Compare those to the comments of many other IRGC commanders who are in the cabinet.

Many people forget that more than two-thirds of the IRGC commanders were initially appointed under Rafsanjani. Rafsanjani was the commander-in-chief, Ayatollah Khomeini had made him a commander-in- chief. Remember Ahmadinejad, with the complete support of Ayatollah Khamenei, tried for eight years to dislodge Rafsanjani from virtually every position of power. He failed. The reason he failed is because Rafsanjani has a base of support in the bazaar, he has a base of support in the clergy, and he has a base of support in the IRGC. Now, because he has distanced himself from Ayatollah Khamenei, he also has a popular base of support, in spite of all the financial shenanigans that everybody knows about. They make a joke. There's a joke, everybody talks about how Rafsanjani had a little garden he claimed one time. It says: he had a little garden; zoning put the garden inside the house, I became rich. People say: yes, he had a little garden, and then the entire country of Iran became part of that garden. That's a running joke. So people know about these things but they are more cautious.

Question 7

I have a question regarding the future of Iran, but also regarding the present tactics for the negotiations and what might happen post-negotiations, whether they succeed or fail. Part of what you were describing, is it conceivable that Iran is reminding the world of how many fingers it has in how many pies in the Middle East, where it can harm western interests and create many regional wars? And reminding the world that if they reach an accommodation with it and basically make it the gendarme of the Middle East in the fight against ISIS, it would be more beneficial for the P5+1 than to remain in the firm stance. The second question is: assuming the negotiations win or fail, Mr Khamenei is a sick man, if not a dying man. The internal forces that are fighting for the succession, is it conceivable – especially if the negotiations fail – that we might see a military takeover of the regime in Iran? Should that happen, what would be the reaction on the street?

Abbas Milani

On the first question, if you read some of the comments made by regime officials inside Iran and by some of their advocates outside – because the regime has been very good in finding people who advocate its point of view inside Iran and outside Iran. It fights a very clever asymmetrical propaganda war. There are no centres for the Anglican Church in five cities in Iran but there are five mosques belonging to Mr Khamenei in some of the major cities in the UK. There are many brilliant ex-Iranian officials who are now in different positions of authority or academia in the west, who propagate the point of view of the regime.

One of them said recently – one who is very close to Rafsanjani – almost exactly what you said, that the west should get a Nixon deal with Iran. The Nixon doctrine with Iran was that Iran is the natural 8 Domestic Dynamics and Foreign Policy: Q&A

hegemon in this region. The Shah wanted to become the hegemon in the region – let's give him the role of the police of the region. The problem with that is that Saudi Arabia, Kuwait, Bahrain and many others will find that a very difficult argument. They found it a difficult argument to sell then, but at that time they were less powerful than they are now. Iran was in a different position. The west was in a different position. So they obviously do make that point very clearly.

Is it possible for the IRGC to take over? I think that is a fear that a lot of people have. Rafsanjani one time almost hinted that that is a serious threat. He said: I brought these people into the economy, now they don't want anything less than the entire country. Clearly, that was a hint that they are becoming more and more ambitious.

If I am right about the state of Iranian society, and I think, I hope I'm right, there might be an attempt at the seizure of power but I don't think it will last. I don't think this kind of thing is a solution to Iran's long- term problems. Iran's economic problems, Iran's ethnic problems, Iran's population growth problems, Iran's addiction problems, Iran's corruption problems – all are not going to be at all solved if you move toward a more authoritarian regime. The only solution to these – and I think the desire of the people – is a more rational, democratic, transparent system.

Question 8

It seems to me, as an amateur observer, that if they would not make a deal this week, it's highly unlikely they're going to make one in six months' time, with a much more hostile US Congress. Therefore, since it's now more likely that there won't be a deal, what do you see happening then? Because the sanctions will be ramped up, foreign investment will disappear totally. It doesn't look good.

Abbas Milani

I fully agree with you. If they don't have a deal and if the sanctions will be ramped up – they will be – I think it does look potentially very dangerous. As one economist recently in Iran described, the Iranian economy is on the verge of collapse. It is a black hole. It is in a condition of totally unpredictable future. He said it's like if an earthquake hits Tehran, no one knows what kind of a social catastrophe will emerge. I think the same thing has happened.

One of the reasons that Mr Khamenei was more amenable to making some concessions for a deal was that he was told that the future is unpredictable, the economy might be in more difficulty than imagined. So if a deal does fail, then I think the only solution they're going to have is to go towards a kind of North Korea economy. But again, that's a very difficult sell. Iran is a little more complicated than North Korea. The middle class, the civil society, is a little more, I think.

Question 9

Conveniently, a follow-on to the previous question: apart from the difficulty that the US might have getting a deal agreed and ratified with a more Republican Congress, how far has the US ability to do any 9 Domestic Dynamics and Foreign Policy: Q&A

sort of deal with Iran been held back by a lot of US opinion not really having moved on from the 1979 revolution, the storming of the US embassy and the era of the Ayatollah Khomeini dartboard?

Abbas Milani

I think one can never underestimate the profound impact that that rather stupid decision to take over the embassy has had, the cost that it has had – the economic cost, the political cost and the psychological cost in the United States, the lingering psychological cost. There are so many factors that one can point to about how profound that shock was. The number of centres for Iranian studies in the US went down after the hostage crisis, whereas in every other crisis that the United States had in a foreign region the number of centres for that country shot up. They poured in millions to study the Soviet Union. The number of Iranian studies declined. The recent surge is virtually in every case because members of the Iranian diaspora have endowed chairs and programmes and allowed this to develop. To me, the reason was that it was psychologically difficult to have Iranian studies. They closed the teaching of the Persian language in the US State Department's foreign languages programme. It is hard to imagine that you would do that, but they did it. They opened it only recently.

My sense is that although it's going to be more difficult to sell a deal, if there is a deal that is sellable – clearly if there's a deal that says Iran can keep 20,000 centrifuges and is not going to back down on any of its deals, that's not going to be a sellable deal. But if Iran does accept, for example, considerable reduction in its enrichment capacity, if it accepts a considerable reduction in its stockpile of 5 per cent, and virtually gives away its 20 per cent and allows Fordow to become more or less defunct, and doesn't add more centrifuges and doesn't go ahead with the research of more sophisticated centrifuges – which seemed to be all part of the deal – and accepts a redesign of Arak, that might be a sellable deal to Congress. Opinion polls have now shifted. Opinion polls until literally a few months ago had Iran as very top of the list of threats to the US. Now, ISIS has become the number one threat. ISIS far outranks Iran in terms of the public opinion perception of what the American people feel.

Of course, the problem with the American political system is that it is polarized towards a stage of complete paralysis. In all the years that I've watched American politics, I have never seen it as close to complete paralysis as it is now. Paralysis in the sense that the Republican Party cannot win a presidential election if their life depended on it, and they gerrymandered the Congress and control the Congress. So you're going to have at least for the next few years a Congress that is controlled by the Republicans, beholden to the Tea Party, and a presidency that is Democratic – and a Republican Party that is more and more unwilling to compromise, and a Democratic Party that is becoming more and more unwilling to compromise.

So the structural problems that the US political system faces – and some of the problems that British politics is going to face, the problem of immigration and the changes that it might bring to the political configuration here. I don't know British politics at all but in the last few days that I've been here, I haven't heard anything but the stories of immigration and how it is challenging the existing political system.

So we truly live – I began with a note of optimism, let me end with a note of pessimism. In all the years that I've studied politics, I've never seen the world as close to peril as today. I've never seen the world as bereft of a kind of visionary leadership that could take this international crisis – the economic crisis, the immigration crisis, the rise of radicalism, the rise of Putinism, the rise of Russian and Chinese authoritarianism, this imbalance and structural unemployment in Europe and the United States – all of 10 Domestic Dynamics and Foreign Policy: Q&A

these. The fact that by 2015, a quarter of the international population will be Muslims. By 2025, you will have 66 million Muslims in Europe (you now have about 44 million). And much of this is being educated by Wahhabi mosques that have more money than anybody else has. They just wrote an open cheque in Kabul: $110 million for a new religious establishment with open-end investment for the future, to build a mosque in the heart of Kabul. They're not going to be teaching liberal democracy there. They're going to be teaching the most intransigent form of Islam. If Europe allows this population to be open to the kind of propaganda that radical Islamists, for example – the number of jihadists from Europe who are now in Syria is a remarkably worrisome thing.

So if I scared you, forgive me. I gave you some good news in the beginning, I have to balance it.

Sharan Tabari

I was going to say that you injected some hope in this world of gloom and doom, but then you finished with more doom and gloom. Anyway, thank you very much, Milani.