What Comes Next For Iran?

The Iranian crisis came like a bolt out of the blue. Neither Supreme Leader Ayatollah Ali Khamenei nor the outside world could have predicted that the presidential election would result in the deepest political and institutional crisis in the history of the Islamic republic.

But although the crisis arose suddenly, it was in fact the result of a protracted internal power struggle and growing popular frustration with more than 30 years of often-brutal repression. Understanding Iran is easier if you keep some facts in mind.

First, in Iran (as in much of the Orient), money does not lead to power, but power leads to money. Iran's wealth is mainly derived from oil, the revenues from which are strictly controlled by the state. Since the 1979 revolution, a new wealthy class has emerged that controls most of Iran's international trade. There are more than 3,000 Iranian companies registered in Dubai and thousands of Iranian businessmen live there. Interestingly, Dubai is the only place in the Middle East where Iranians have demonstrated against President Mahmud Ahmadinejad and for Mir Hossein Musavi.

This is because during the years of the Khamenei-Ahmadinejad tandem, the logic of power and the logic of business have increasingly clashed. Like their counterparts everywhere, Iranian businessmen prefer open markets, political stability, freedom of movement. But Ahmadinejad pursues authoritarian financial and economic policies.

The Council of Money and Credit, which formerly monitored state monetary policy, was abolished. The Central Bank has had three different directors since Ahmadinejad became president. Unemployment was about 25 percent even before the global economic crisis struck.

At the same time, Khamenei and Ahmadinejad have pursued aggressive and confrontational foreign policies that have increased Iran's isolation and harmed the interests of Iran's economic elite.

A number of Iranian banks in the West have either been closed down or significantly restricted. Much of Iran's liquidity in the United States and Europe has been frozen. During the latest round of sanctions, imposed during the presidential campaign, Britain infuriated Khamenei by freezing some 1 billion pounds of Iranian capital.

All this may explain why anger and dissatisfaction with the current regime are so deep among Iran's business elite. Former President Ali Akbar Hashemi Rafsanjani, who is listed by "Forbes" among the richest people in the world, is the voice of this increasingly discontented wealthy class.

Intellectual Backlash

In addition, Khamenei and Ahmadinejad have ruffled feathers among the country's bureaucrats. As an old state, Iran has a very large and experienced bureaucratic apparatus with long historical traditions. It has managed vast empires, both before Islam and after.

But Ahmadinejad is capable of irritating any decent civil servant. His sharp rhetoric, his aggression, and uncouth manners, combined with his reference to mythological stories and his fast-and-easy manner with statistics constantly anger the bureaucracy.

It is no longer to prestigious to serve a state headed by a president who constantly violates unwritten rules of behavior. For instance, he has said the aim of his administration is to render possible the reappearance of the Hidden Imam; how is the bureaucracy supposed to implement such a policy? How many times must Iranian delegations to international events face scorn because of the president's inappropriate statements?

Over the last two years, professors and economists have written open letters to the president warning about economic mismanagement and inefficiency. Now many of these experts support Musavi, not because they agree with his views but because they reject Ahmadinejad's. Musavi represents the currently available alternative to the sense of disgrace and frustration that much of Iran's cultured elite feels. In addition, they are sympathetic to Musavi, who is an architect and amateur painter and head of the National Council of Art.

In short, we are seeing a convergence of interests between the economic elite, whose interests are represented by Rafsanjani and the bureaucratic/cultural elite, represented by Musavi.

Revolutionary Guard Behind The Throne

Clearly, the Islamic Revolution Guard Corps (IRGC) (and the associated Basij militia) forms the basis of Khamenei's power. The aging supreme leader seems concerned with accelerating the political accession of his son, Mojtaba, to succeed him and has apparently concluded that this can be best assured by relying on a Praetorian Guard comprising the IRGC and the Basij rather than on the clergy, which has come to be despised by many Iranians. There are few taxis in Tehran that will stop for a cleric, and young men occasionally snatch the turbans off cleric in the streets of the capital.

However, with his unreserved support for Ahmadinejad, Khamenei risks becoming increasingly dependent on the IRGC. By cutting himself off from the important segment of the population represented by Rafsanjani -- who, after all, has been Khamenei's comrade in arms for more than 50 years -- Khamenei is in danger of becoming a hostage to the IRGC.

The question is what the IRGC can or will do. They find themselves in the same favorable position as the traditional business interests were in during the 1979 revolution. Then, the clergy succeeded in taking power with the support and financing of the bazaar. Now the same clergy depends on the IRGC to retain power.

Increasingly, that support may come with strings attached. The IRGC could play the role of "consigliere" among the different factions of the regime. But one way or another they will be forced to eliminate the contradictions between the logic of business and the logic of power that have emerged.

This could mean forcing Ahmadinejad to adopt a very different program from what we have seen so far. Or it could mean replacing him with another IRGC-friendly president such as parliament speaker Ali Larijani (the son of an ayatollah and the son-in-law of Ayatollah Mottahari, the prestigious ideologue of Khomeinism who was assassinated in 1979) or current Tehran Mayor Mohammad Baqir Qalibaf, whose connections run deep into the IRGC.

Or the IRGC could allow the situation to deteriorate further so that it could play the role of savior of the country. A type of Bonapartism could emerge, with Iran becoming more nationalist than Islamist.

Much of the uncertainty in these scenarios stems from the fact that Iran -- unlike Turkey, Egypt, or Syria -- has never had a military caste. The military has always been loyal to the leader rather than to its own corporate interests. It is possible that Khamenei will be able to continue exploiting this tradition. If the IRGC decides to act as a unite corps, it would be the first time something like that has happened in the modern history of the country.

Whose Revolution Is It?

Another possibility, one being espoused by some of the most radical Islamists, headed by Ayatollah Mesbah Yazdi, is replacing the current Islamic republic (jomhuri-e Islami) with an Islamic regime (hukumat-e Islami). This would mean a Shi'ite caliphate without elections, a parliament, or a president. This project is not far from the Khamenei-Ahmadinejad mind-set, and they perceive it as being in line with Khomeini's original model, which he outlined in his 1971 book "Hukumat-e Islami."

Although the idea has some influential support, especially among some Basij units, supporters of the current system and the public in general oppose it strongly. At this point, the logic of the Khamenei-Ahmadinejad tandem collides head-on with the logic of the Iranian people.

In a speech on June 19, Khamenei noted that Iran is not Georgia, where a soft revolution was brought to a boil by financial support from the West. But you could just as well argue that Iran is not Saudi Arabia or North Korea, countries were passive populations have silently endured decades of tyrannical governance. After 30 years, it has become clear to most Iranians -- particularly young Iranians -- that the 1979 revolution is not their revolution. They want to control their own destiny.

The protest movement last month was precisely an expression of this will. The most notable aspect of the demonstrations in Tehran and other major cities was the maturity shown. Unlike 1979, protesters rejected violence and simply asked, "Where is my vote?" The only "violent" slogan -- "Death to the dictator!" -- sent a clear message to Ahmadinejad and Khamenei.

Now, it is no longer a matter of election fraud. The issue is not Ahmadinejad as a personality, or the role of the Guardians Council vetting body, or who is the supreme leader. The entire structure of the Islamic republic is under question and the era of public political apathy is over.

The protest movement has already weakened the Islamic regime considerably. No matter how the ruling elite manages the situation, the days of the Islamic republic in its current form are numbered. It won't happen tomorrow, but the new will of the people may yet sweep away both the ayatollahs and the IRGC. As one Persian proverb says, "This is only a beginning. Don't be too impatient."

Mehdi Mozaffari is a professor of political science at Aarhus University and head of the Center for Studies in Islamism and Radicalization (CIR). The views expressed in this commentary are the author's own and do not necessarily reflect those of RFE/RL