Sunday, March 30, 2014

Iran: No end in sight

Iran has had a declining economy for quite some time now as a result of years of mismanagement and detrimental economic sanctions that have gradually sucked the economy dry. The economy has been dead, lying lifeless and comatose, and the Iranian people have been drowning in their economically deprived nation just hoping for something to save them from these economic woes. Last year, the Iranian people thought they had found that hope in Hassan Rouhani when they voted in massive numbers to elect him as president as he offered an attractive future for Iran that involved economic revitalization by improving international relations, and in doing so, international trade. However, such bright visions for the future turned out to be largely fruitless. President Rouhani has managed to halt inflation, but with the lack of petrodollars and rapidly declining tax revenues, President Rouhani has been pushed to take some fairly drastic measures: cuts in energy subsidies that will nearly double the price of electricity and gasoline.

Many Iranians have been forced to take on second jobs as a result of the economic woes that plague the country, and for many, this second job is illegal street vending. Yet despite this outburst of street vending, many Iranians have found very little success in their secondary jobs.

The economic decline has produced a stark decline in people's faith in the governments ability to get the economy going, and outside investors have also been convinced that Iran's economic decline will just continue on its downward spiral. The amount of outside investment has declined year to year, and this has only served to exacerbate the economic troubles of Iran.

In response to the decline and the growing unrest among the Iranian people, Ayatollah Ali Khameni, Iran's supreme leader, has urged the government to focus less on the economic growth but rather focus on the social issues and for a more equal distribution of wealth. In his words “The Islamic system does not accept economic growth without social justice.” Khameni envisions a future for Iran where Iran is largely self-sufficient. Rouhani, on the other hand, sees that only improved international relations and the resulting increased trade serves as the only path to economic growth and social growth.

Iran, in the strictest sense, needs to focus more on its economy before it dedicates more efforts towards fixing the social issues that plague its citizens. Solving social issues for Iran in its current state is next to impossible as Iran is currently drowning miserably. Ayatollah Khameni's goal of making Iran largely self-sufficient is unrealistic, oversimplifies the issues that plague Iran, and does not take into account many fairly insurmountable factors such as the fact that Iran lacks the massive amounts of resources and infrastructure necessary to become a self-sufficient state. Growing unrest in Iran is a major issue, but attempting to make a self-sufficient state is not the answer. For Iran, it seems as though there is no end in sight for its economic troubles.

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