The Declining Power of Iran’s Moderate President Rouhani: The Ultimate Clash Between Supreme Leader Khamenei and President Rouhani Over JCPOA and Iran’s Economy

Based on Analysis of Khamenei’s March 20, 2017, Nawruz Message

Strong admonishments of President Rouhani are clearly heard in Ayatollah Khamenei’s March 20, 2017, pre-recorded televised Nawruz, or the Persian New Year message. The 2015 nuclear deal known as Joint Comprehensive Plan of Action (JCPOA) signed between Iran and the P5+1 (China, France, Russia, the United Kingdom, and the United States, plus Germany),

hostile U.S.-Iran relations, and Iran’s slow economic recovery are at the core of tensions between the top two Iranian leaders.

Prior to Nawruz, Khamenei’s website posted the top three most famous 2016 statements made by the Supreme Leader. In first place was the statement made by Khamenei on June 14, 2016, as he sent a stark warning to the United States: “If the U.S. tears JCPOA, Iran will torch it!” This comment was made during his address to the three branches of the government in response to then-presidential candidate Trump’s assertions that if elected, he will “dismantle” the “disastrous” nuclear deal.

While Iran’s economy may be the main topic in this year’s Nawruz speech, continuing controversies over Iran’s nuclear deal seem to remain to be at the heart of growing tensions in Tehran. On Monday, March 20th, during a press interview with reporters in central Iran in the city of Esfahan, Zarif stated that while Iran is committed to abiding by the JCPOA, they will expedite nuclear advances should the United States violate the terms of the agreement:

Iran is fully prepared to return to the pre-JCPOA situation or even [to conditions] more robust than that if the U.S. reneges on its promises to the extent that the JCPOA’s continuation harms our national interests. At present, we possess the know-how to manufacture and use centrifuges with [an enrichment] capacity 20 times more than that of previous centrifuges.

Zarif was responding to President Trump’s statements during his meeting with visiting Iraqi Prime Minister Haider al-Abadi in the White House earlier on Monday when he once again questioned the logic behind JCPOA, stating: “One of the things I did ask is, ‘Why did President Obama sign that agreement with Iran?’ Because nobody has been able to figure that one out. . . . But maybe someday we will be able to figure that one out.”

Tehran-Trump Clashes 

Clashes between Washington and Tehran began shortly after President Trump took office. On January 27, 2017, President Trump signed his first Immigration Executive Order: “Protecting the Nation from Foreign Terrorist Entry into the United States,” enacting a ban on the admittance of all refugees to the United States, temporarily freezing immigration from seven majority Muslim countries. Iran was included in what I call, “Trump’s Heptagon Immigration Ban” alongside Iraq, Syria, Yemen, Libya, Sudan, and Somalia. Iraq was later removed from the list in the president’s revised March 6, 2017 Executive Order.

In response and in defiance of Washington’s political muscle against Iran, and to “showcase the power of Iran’s Revolution,” the following day, Tehran conducted a missile test in Semnan province. Gen. Amir Ali Hajizadeh, Chief of Iran’s Islamic Revisionary Guard Corps warned, “If the enemy does not walk the line, our missiles will come down on them.” On Monday, January 29th, Trump’s former National Security Adviser Micheal Flynn issued a statement putting Iran “on notice.” On Friday, February 3rd, the Treasury Department imposed sanctions on 25 individuals and companies connected to Iran’s ballistic missile program and those providing support to Iran’s Islamic Revolutionary Guard Corps’s Qods Force. Flynn called Iran’s move as “provocative” and in defiance of UN Security Resolution 1929, which was adopted on June 9, 2010. The Security Council imposed a conventional arms embargo on Iran and addressed Iran’s ballistic missile program, stating:

[The Security Council] decides that Iran shall not undertake any activity related to ballistic missiles capable of delivering nuclear weapons, including launches using ballistic missile technology, and that United States shall take all necessary measures to prevent the transfer of technology or technical assistance to Iran related to such activities.

Paragraph 3 of Annex B of Resolution 2231 (2015)—the final JCPOA—confirms these terms, stating: “Iran is not to undertake any activity related to ballistic missiles designed to be capable of delivering nuclear weapons, including launches using such ballistic missile technology.”

Issuing a statement on the new sanctions, Flynn warned that the “international community has been too tolerant of Iran’s bad behavior. The days of turning a blind eye to Iran’s hostile and belligerent actions toward the United States and the world community are over.”

Khamenei responded to Washington in his remarks in a meeting with thousands of people from East Azerbaijan province on February 15th, stating:

Both under the former American administration, and under the present administration, one of the ploys used by the enemy has been to keep threatening [the country] with war; and [that] the military option is on the table and the likes of this. That European official tells our officials that if it was not for the JCPOA, war in Iran would be inevitable, [and] there would certainly be war, [but] this is a sheer lie! Why they talk about war? [They do this] in order to deflect our focus toward [military] war, [but] the real war is something else; the real war is the economic war, the real is [the imposition of] sanctions, [and] the real war is to conquer the areas of work and activity and technology inside the country; this is the real war. They threaten us with the military war in order to [make us] ignore this; [to forget that] the real war is the cultural war.

By culture, Khamenei means all aspects of Iranian society: its domestic and foreign policies, social and cultural norms, education, economy, military, intelligence, and security apparatus. In other words, he says that the U.S.’s intent is to once again take control of Iranian society and dominate Iran as they did during the Shah’s regime.

Interestingly, on March 9, 2017, Khamenei’s website posted an infograph that portrayed a gold missile made out of coins and missile assembly parts. Statements from Khamenei’s February 15th address appeared on the infograph with a headline, “The real war is the economic war, the real was is [the imposition of] sanctions, [and] the real war is to conquer the areas of work and activity and technology inside the country.”

It is clear that Khamenei comes to his Nawruz message, by far the most important missive of the year, as he begins to set the tone for the government and policy direction for the country, in particular during a presidential election year, with one thing in mind: How should Iran counter an imminent U.S. threat and protect its economy and security? In other words, how should he prepare Iran for possible escalation of discord between U.S. and Iran that may lead to further sanctions and possible military confrontations? For Khamenei these are critical times in Iranian politics as he is fast approaching the end of his leadership, making the May 19th Iranian presidential elections perhaps the most important one during his 28-year Leadership. The political trajectory Iran will take will have grave consequences for his successor. Either it will pave the way to a smooth transition to his desired candidate for Supreme Leadership or create challenges for it. Nonetheless, one thing Khamenei has to do for sure. He has to make sure that he has secured the Islamic Republic (the regime itself) against any existential threats after his rule. This entails strengthening Iran’s economy, putting Iranian young people to work so that they do not rebel against their country, advancing Iran’s technology, strengthening its military, and establishing strong alliances, while protecting Iran’s Islamic culture and the Iranian young people from Western influences. If Rouhani is unable to commit himself to the task, then perhaps it is time for a “conservative” president.

Khamenei-Rouhani Tensions Over Iran’s Economy

I have heard your concerns…” is the message Ayatollah Khamenei sends to the Iranian people during his televised, pre-recorded message for Nawruz. His official website is filled with inforgraphs and messages that communicate the concerned and anxious voices of the Iranian people about Iran’s economic conditions. He assures Iranians:

I am aware of the [economic] condition of the people. I can sense the bitterness of the people, especially the poor and the lower class, who are experiencing economic hardships due to inflation, unemployment, discriminations, inequalities and social maladies. We are all responsible before God and the people [for creating this situation and for improving the country’s economic conditions].

On the contrary, during his televised Nawruz message to the nation, Rouhani displayed a different outlook about Iran’s economic conditions—a more positive view:

The Year 1395 was the year of both implementing ‘Resistance Economy: Action and Deed’ and the implementation of nuclear agreement; and these two had a positive role and effect for us. . . . We achieved the 8-percent economic growth rate for the first time after the 20-year outlook document announcemt by the Supreme Leader. . . . What we achieved in last year in harnessing inflation and achieving economic growth and employment, was second to none in 25 years. We need to continue decreasing trend of inflation and the growing trend of economic growth. We can increase wages and salaries of workers and employees to more than the inflation rate and this means that our people can have more welfare. . . . The new year will be the year of progress and development for our dear nation. The new year will be the year of more employment for our youths. We need to carry out more efforts to compensate for the shortcomings.

While Rouhani reflects a more positive outlook over Iran’s economic growth, one thing is decisively clear: Khamenei does not agree with the president as they enter into the presidential election season.

Instead, Khamenei reminds the nation that in his efforts for economic recovery last year, he had instructed Rouhani’s government to take “practical steps and actions” to revive the economy. While efforts have been made, “there is still a major gap between what has been done and the expectations of the people and me,” noted Khamenei.

It is noteworthy to say that this is not the first harsh criticism of Rouhani by Khamenei.

Khamenei began his stern warnings to Rouhani about Iran’s stagnant economy and high unemployment rate beginning spring 2016. A few months after the Implementation Day of JCPOA (January 16, 2016), during his address to the three branches of the government, Khamenei focused on Iran’s economy and JCPOA; creating a close correlation between the two.

First, he discussed economic stagnation and unemployment as two major problems in the country stating: “These problems stem more from the policies and planning of the current and previous administrations than [international] sanctions.”

Expressing solutions for these problems, Khamenei refocused on the core fundamentals of Resistance Economy policy with a particular attention to the revival of small and medium-sized industries in order to boost job creation. He believed that supporting science-based companies was a priority that would help resolve the two major problems of stagnation and unemployment. He asked the government to give priority to attracting foreign investments and resources to serve the necessary sectors of the government. In terms of manufacturing and export of petroleum products instead of selling crude oil Khamenei recommended, “The country needs to increase oil production and exports, but in a country with the largest oil and gas [combined] reserves in the world there must be no gasoline imports and officials must make plans and take action for resolving this problem.”

As to the JCPOA, Khamenei confronted both proponents and opponents of the JCPOA accusing both sides of exaggerating the agreement, saying:

Those who are praising the JCPOA as well as its opponents and critics have been often exaggerating in their expression of views. That is the case while the JCPOA has both ‘positive points and advantages’ as well as ‘weak points and disadvantages.’ The JCPOA’s advantages were the cases that persuaded the Islamic Republic to opt for negotiations. Of course, many of those advantages were not achieved. These disadvantages are issues which we have always been worried about and we reiterated that the opposite side is unreliable and evil-natured and will renege on and break its promises. As far as the JCPOA is concerned, there are some loopholes whose elimination would have lessened or removed the disadvantages. What we are saying about the JCPOA does by no means target the efforts and endeavors of these dear brethren. Rather it is an assessment of the performance of the opposite side.

Responding to statements made by then-presidential candidate Trump and his campaign team about “dismantling” Iran’s nuclear deal, Khamenei warned:

Primarily, the Islamic Republic will not violate the JCPOA because keeping pledges is a Quranic instruction, but if the U.S. presidential candidate’s threat to tear up the JCPOA materializes, the Islamic Republic will torch the JCPOA. It is again a Quranic instruction about mutual disloyalty.

Reflecting on U.S.’s refusal to fulfill its obligations, he said:

The opposite side’s task was to lift the sanctions, but it has not fulfilled this duty. Some sanctions have been lifted in some way, but in practice the sanctions have not been [generally] lifted. The Americans have kept fully in place the primary sanctions and this issue affects the secondary sanctions that were supposed to be removed. The officials involved [in the JCPOA] must take into consideration these realities and stop repeating that the sanctions have been lifted. The U.S. government officials claim in words and directives that there is no obstacle to banking transactions with Iran, but in practice they act in a way that banks will not dare deal with Iran. The American side has committed this big sin and fault by hindering foreign banks’ interactions with Iran and nobody should justify the Americans’ behavior.

Tensions between the two leaders were evident during Khamenei’s address to President Rouhani and his cabinet on August 2, 2016, when the Leader harshly criticized the president and his government for their failure to fully implement the economic policies he had set forth for Rouhani’s government. It was then that the Leader instructed Rouhani:

With planning and with a serious approach, the government should do its best to work hard in the remainder of the year. . . . The government should not busy itself with electoral discussions in any way. On the contrary, it should formulate plans until the last day of work, to endeavor to solve problems. The best promotion for an administration that holds office is its action and implementation.

Khamenei was instructing Rouhani not to become occupied with re-election. This could have meant a severe rift between the two leaders or an indirect message and assurance to Rouhani about his second term. Whether this meant Rouhani’s re-election or lack of it remains to be seen. Either way, Khamenei was telling Rouhani to be busy with his obligations since basically he did not exercise much control over his re-election.

While Rouhani has closely followed a Khamenei-written script from the outset of his presidency, like his predecessors, he too, does not seem to be immune from an ultimate clash with the Leader. Thus far, none of the four presidents under Khamenei seem to have been able to fully fulfill Khamenei’s visions for Iran. Neither the pragmatic President Hashemi Rafsanjani’s open door policy, nor the reformist Khatami’s ‘Dialogue Among Civilizations,’ nor the hardliner Ahmadinejad’s ‘Second Cultural Revolution’ and nuclear advancements, nor the moderate Rouhani’s rapprochement with the West and nuclear negotiation have satisfied the Leader. While they all made some strides in bringing Iran closer to becoming a regional political power, none of them were able to make Iran the economic power envisioned by Khamenei. Iran is still faced with international sanctions and still reputed as a ‘state in sponsor of terrorism’ by the United States. Hence, in Khamenei’s perspectives, none of the presidents were able to carry out Khomeini-Khamenei’s Islamic Revolutionary’s ultimate mission of removing any of the lingering existential threats against Iran by the United States or its regional allies, including Israel. For Khamenei, his vision of Iran as an economic, political and military power with advances in sciences and technology have not been fully realized, primarily, due to the policies of his presidents, who have failed to alleviate economic challenges in Iran. Hence, it is time for a forceful move on behalf of the Leader—certainly a new political approach—possibly to be revealed shortly after Nawruz.

The Struggle Over Iran’s Economy and its Implications for the May 19th Presidential Elections

It is likely that Khamenei may choose to abandon Rouhani and move toward supporting a conservative president who is fully supported by or affiliated with the Islamic Revolutionary Guards Corps (IRGC or Sepah). On the other hand, he may choose to keep Rouhani in power in order to avoid upsetting the majority of the Iranian people by removing the moderate president, and instead continuing to work behind the scenes toward succession to his power. Regardless of the path Khamenei takes with Iran’s presidential elections, one thing is for sure: The protection of Iran’s Islamic regime against any internal and external threats is the top priority for the Leader. He will use any measures to ensure the removal of any existential threats against the Islamic Republic. Therefore, it should be no surprise to anyone if the Supreme Leader’s Office attempts to tightly control Iran’s elections through the Sepah and Basiji forces to avoid political unrest in the country. For the conservatives, this a critical election and Khamenei will take no chances regarding another 2009 presidential elections (when Iran experienced the birth of the Green Movement and widespread demonstrations disputing Ahmadinejad’s re-election) or a 2017 “Iran Spring.” He will defend the Islamic Republic at any cost.

As to the majority of Iranians, while a Maryland study shows that Rouhani’s popularity has declined among Iranians due to his inability to revive the economy according to the expectations of the nation, in the face of uncertainties with the Trump administration and possibilities of a robust confrontations with the United States, Iranians will most likely decide to re-elect their moderate president for three reasons: a) they need a moderate voice in Iran to reason with Iran’s adversaries; b) Rouhani has been able to cut a nuclear deal, lift some sanctions, and open Iran’s market to most of the outside world. Yes, economic growth is very slow, but at least, it has started. The European Union members and the rest of the P5+1 members are fully in support of the nuclear deal and trade with Iran; c) most Iranian young people want social and political reform and integration into the global community. While reform has been slow under Rouhani at least it is steady. With the demise of Ayatollah Hashemi Rafsanjani, chances for another moderate or reformist candidate to be able to break through the ceiling of Iran’s hardliners may be very difficult. Even the candidacy of pragmatic Hassan Khomeini (grandson of Ayatollah Ruhollah Khomeini) for the 2016 Assembly of Experts (the clerical body that chooses Iran’s Supreme Leader) was rejected by the Guardian Council. Thus far, there seems to be no other candidate in the moderate camp who can fill Rouhani’s shoes. In the absence of Hashemi Rafsanjani, Rouhani seems to be the most senior representative of the pragmatics and moderates in Iran.

Implications for the United States

The May 19th elections will set the tone for Iran not only for the next four years but at least the next two to three decades, especially with a nuclear deal that will expire in less than two decades. May election is perhaps the most important presidential election during the course of Khamenei’s 28-year leadership. For the time being, Khamenei seems to be leaning toward a conservative presidential candidate. While Rouhani has tried to follow a Khamenei-written script throughout his presidency, the 2015 nuclear deal may cost him his reelection. For a Supreme Leader who has maintained ambitions for a strong Iran politically, economically, culturally, socially, and militarily, in light of recent clashes with the Trump administration, Rouhani seems to have compromised most of the values critical to the Leader.

Benefits for the Trump Administration if Rouhani Is Re-Elected

Rouhani is a moderate politician, and he has proven to possess a political ideology that is absent of Khomeini-Khamenei’s “Neither East, Nor West” isolationist policy. Rouhani is open to diplomatic relations with the United States and cooperating with the U.S. on critical regional issues including combating ISIS and terrorism. The majority of Rouhani’s cabinet is comprised of men who have earned higher education in the West. Rouhani himself has earned his M.A. and Ph.D. from Scotland, while Foreign Minister Javad Zarif and several others studied in the United States. What this means is that his government has a tendency to think in Western terms as well. They understand the Western mentality and to some extent have respect for its politics and traditions. They are both insiders and outsiders. They see both sides and understand both sides. Prime Minister Netanyahu labeled Rouhani correctly: “A wolf in sheep’s clothing.” In a less harsh manner what Netanyahu is saying is accurate. Rouhani is smart, and he can see and understand his allies and adversaries both through an insider’s and an outsider’s lens. While Rouhani believes in the Palestinian cause, he does not believe in political confrontations with Israel. He prefers to find a more peaceful solution to the Arab-Israeli conflict. Under Rouhani’s presidency, the likelihood of Iran walking from JCPOA is unlikely, unless the Supreme Leader believes in the existence of an imminent existential threat against the Islamic Republic and issues a fatwa (decree) for a “holy defense.”

It is for these reasons and beyond that the U.S. should do everything in its power not to antagonize the Iranian conservative elites and instead execute Iranian policies that boost Rouhani’s popularity and increase his re-election chances. With an Islamic Republic in power, it is in the best interests of Iranian people, the region, and the U.S. that President Rouhani is re-elected and ultimately becomes Khamenei’s successor.

It will be in U.S.’s short term and long term interests if the State Department invests in diplomatic relations with Iran by developing robust public diplomacy programs and increasing people-to-people programs with Iranians, especially Iranian young people. It would be wise for the Trump administration to create programs that would engage the nearly 65% of the Iranian population, ages 35 and under. Such a practical step will help the United States to avoid growing hostilities between the Iranian young people and the United States.


Note: According to the CIA statistics, nearly 87% of Iran’s 82 million population is 54 and younger.

Please Share:

Leave a Reply

Your email address will not be published. Required fields are marked *