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Persian Gulf

Abridged by Adam Dempsey, Research Associate, U K Defence Forum, from an article, originally published by the New York Times on January 16th 2011, written by William Yong

Iran has embarked on a sweeping program of cuts in its costly and inefficient system of subsidies on fuel and other essential goods that has put a strain on state finances and held back economic progress for years. The government's success in overcoming political obstacles to make the cuts and its willingness to risk social upheaval suggest that President Mahmoud Ahmadinejad may have consolidated power after the internal fractures that followed his bitterly disputed re-election in 2009.

Analysts also believe that the successful implementation of the cuts could influence Iran's position at nuclear talks in Istanbul this month. "The initial success of the subsidy reform will increase the regime's confidence generally," said Cliff Kupchan, a former State Department official who is now a director at the Washington-based Eurasia Group. "This could make them more assertive in the talks. But more importantly, a confident and unified regime is better positioned to reach consensus on some initial agreement."

Secretary of State Hillary Rodham Clinton said recently that international sanctions had slowed Iran's nuclear program, and the restrictions do seem to have disrupted sectors of the economy, particularly banking and export-related industries. But the sanctions do not seem to be the driving force behind the subsidy cuts.

Iran's foreign exchange revenues also sank in recent years as oil prices fell from prerecession highs, creating greater budget pressures. But Tehran has long sought to cut the subsidies even under the reformist administration of President Mohammad Khatami and particularly for oil.

The logic is compelling: artificially low prices encourage greater consumption, leaving less oil to export for cash. And the higher oil prices rise, the greater the "opportunity costs" in lost exports. But the timing, whether for political or economic reasons, was never right to cut the subsidies.

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By Alex Shone, UK Defence Forum Research Associate in Residence

On 8th March, Ayatollah Mohammad Reza Mahdavi-Kani, an 80-year-old conservative cleric, was elected as the chairman of Iran's Assembly of Experts. Mahdavi-Kani replaced Akbar Hashemi-Rafsanjani, who had headed the Assembly for the previous four years. Yesterday, in the House of Commons, it was asked of the UK Government what their assessment was of Rafsanjani's departure from the Assembly. The answer was that this event was not anticipated to seriously impact the current course of Iran's internal and external policies, though these will remain of great concern.

Mohammad Reza Mahdavi-Kani

Born in 1931 in the village of Kan, near Tehran, he began his education in Tehran and left for Qom to study at a seminary in 1947, aged 16. One of his teachers was Imam Khomeyni (later Ayatollah Khomeyni). He was imprisoned and tortured due to his political activity in the 1970s. Mahdavi-Kani has a history of medical conditions. He has been hospitalised with heart problems three times in 1985, 2001 and 2005.

Iran's Assembly of Experts

There 86 members of the Assembly of Experts and their role is to appoint the Supreme Leader, monitor his performance and remove the Leader from post if he is deemed incapable of fulfilling his duties. The Assembly's members are elected by the public for 8 year terms in a general election. The candidates are carefully vetted before being allowed to stand and the Assembly is dominated by religious conservatives.

Political career

Mahdavi-Kani was among the founding members of the Military Clergy Association, the jame'eh-ye rowhaniyat-e mobarez, (JRM). The Association started in 1977 as an anti-Shah movement and gained power after the 1979 Islamic Revolution.

After the Revolution, Mahdavi-Kani was appointed a member of Guardian Council in 1980 and served as Iran's interior minister between 1980 and 1981. He served as acting Prime Minister from September to October 1981, after the assassination of his predecessor, Mohammad Javad Bahonar. Mahdavi-Kani has also served as a member of the Council of the Islamic Revolution Committee and the Supreme Council of Cultural Revolution.

In 1984, Mahdavi-Kani became provisional Friday prayer leader for Tehran for two years. In 1997, he was elected to the Expediency Council, and in 1989 Ayatollah Khamene'i appointed him as the Director of Mosques. In 1999, Mahdavi-Kani was elected as secretary-general of the JRM, a position he holds to this day. He is also the chancellor of the Imam Sadeq University in Tehran.

Mahdavi-Kani is a traditional conservative cleric who elects to stay behind the scenes. He is a loyal follower of Ayatollah Khomeyni and has expressed criticism towards President Ahmadinejad. Mahdavi-Kani actually refused to receive the President during the latter's visit to Imam Sadeq University in 2007, though he supported Ahmadinejad's candidacy in the 2009 presidential election.

In memoirs published in 2007, Mahdavi-Kani said that he had always been opposed to the siege of the USA embassy in Tehran in 1979 demanding the extradition of the Shah from the USA to face trial in Iran.


By George Friedman

It is August 2010, which is the month when the last U.S. combat troops are scheduled to leave Iraq. It is therefore time to take stock of the situation in Iraq, which has changed places with Afghanistan as the forgotten war. This is all the more important since 50,000 troops will remain in Iraq, and while they may not be considered combat troops, a great deal of combat power remains embedded with them. So we are far from the end of the war in Iraq. The question is whether the departure of the last combat units is a significant milestone and, if it is, what it signifies.

The United States invaded Iraq in 2003 with three goals: The first was the destruction of the Iraqi army, the second was the destruction of the Baathist regime and the third was the replacement of that regime with a stable, pro-American government in Baghdad. The first two goals were achieved within weeks. Seven years later, however, Iraq still does not yet have a stable government, let alone a pro-American government. The lack of that government is what puts the current strategy in jeopardy.

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By George Friedman

Public discussion of potential attacks on Iran's nuclear development sites is surging again. This has happened before. On several occasions, leaks about potential airstrikes have created an atmosphere of impending war. These leaks normally coincided with diplomatic initiatives and were designed to intimidate the Iranians and facilitate a settlement favorable to the United States and Israel. These initiatives have failed in the past. It is therefore reasonable to associate the current avalanche of reports with the imposition of sanctions and view it as an attempt to increase the pressure on Iran and either force a policy shift or take advantage of divisions within the regime.

My first instinct is to dismiss the war talk as simply another round of psychological warfare against Iran, this time originating with Israel. Most of the reports indicate that Israel is on the verge of attacking Iran. From a psychological-warfare standpoint, this sets up the good-cop/bad-cop routine. The Israelis play the mad dog barely restrained by the more sober Americans, who urge the Iranians through intermediaries to make concessions and head off a war. As I said, we have been here before several times, and this hasn't worked.

The worst sin of intelligence is complacency, the belief that simply because something has happened (or has not happened) several times before it is not going to happen this time. But each episode must be considered carefully in its own light and preconceptions from previous episodes must be banished. Indeed, the previous episodes might well have been intended to lull the Iranians into complacency themselves. Paradoxically, the very existence of another round of war talk could be intended to convince the Iranians that war is distant while covert war preparations take place. An attack may be in the offing, but the public displays neither confirm nor deny that possibility.

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