The Particular Features of the Islamic Republic’s Capitalism and the Need for a Humanist Alternative to Capitalism/Militarism

There is no doubt that there are divisions within the Iranian ruling class concerning economic and political approaches. There is no doubt that Iran’s capitalism is inefficient. There is no doubt that the IRGC acts like a Mafia band. However, currently, it seems that the IRGC, the government (president and parliament) and the Guardian Jurist, are all united around the goal of preserving a strong state with a smaller social welfare sector and a much larger military sector.

Below is the English translation of a presentation delivered by Frieda Afary  to  Radio Hambastegi,  a leftist and feminist Persian-language radio station based in Stockholm, Sweden.    It was recorded on May 3 and broadcast on June 24 as part of a  series on the particular features of the Iranian economy.

Link to radio broadcast in Persian:


Let’s begin with some economic facts:

In Iran, 40% of the population live under the relative poverty line and 33%  under the absolute poverty line.  The legal monthly minimum wage is approximately $230 even though the minimum monthly wage required for the survival of a family of four is $900.  According to the vice president,  Eshaq Jahangiri,  over 1.2 million people enter the job market annually but at best only 600,000 find jobs.  Two thirds of those who are of employment age are unemployed.   The unemployment rate among women is twice that of men.  The unemployment rate among college educated women who constitute 60% of all university graduates is 65%.   Although workers do not have the right to form independent labor organization,  not a day goes by without a protest by workers, or teachers or retirees or nurses.  These protests are mainly about the non-payment of wages, bread and butter issues and the lack of workplace safety.   According to government claims, during the past year, Iran’s gross domestic product has increased by 11% due to the removal of some economic sanctions  and an increase in oil exports.  However, manufacturing enterprises have not officially hired new employees and have instead laid off 94,000 industrial workers.  More than 90%  of labor contracts in Iran are temporary and do not give  any rights or benefits to workers.   Water and air pollutions is worsening daily.  Half the Iranian population does not have access to a sewage system.  At the same time, the government states that it has increased the annual budget for military and security forces by over 21% [unofficial estimates are higher].    Officially,  56% of the “fund for national development” has been devoted to “improving security capacity.”

How do Iranian economists analyze and interpret these facts?  Among those economists who have explored the nature of the Islamic Republic’s economy and have offered solutions for exiting the current crisis,  one can point out three types of analyses:   1. Those who see a large public sector and substantial subsidies as the source of the Islamic Republic’s economic problems.  2.  Those who think that the Iranian economy has parallel and competing institutions that prevent the creation of an efficient and productive capitalism.  3.  Those who see privatization as the  the main  source of the country’s economic problems.

The first group includes economists such as Masoud Nili,  chief economic advisor to president Hassan Rouhani.  In the second group,   Mehrdad Vahabi,  economics professor at the University of Paris and  author of The Political Economy of Destructive Force (2004) is a theorist.  Suzanne Maloney, a U.S. economist has also used this thesis in her Iran’s Economy Since the Revolution (2015).   The third group includes many leftist economists such as Mohammad Maljoo.

This article will first offer a summary of each person’s views/analyses.  Then I will discuss some questions and concepts that are needed for  critically evaluating these economic analyses and for taking practical steps  in a humanist direction.

I.How Have Iranian Economists Analyzed the Nature of the Islamic Republic’s Economy?

In his,  Whither the Iranian Economy? (2015),  Masoud Nili asks why Iran is suffering from a low rate of economic growth despite having rich natural resources,  a geographical location that connects Eastern Asia to Europe,  an industrial infrastructure,  and a young and educated labor force.   Putting aside  the effects of the economic sanctions related to the Islamic Republic’s nuclear project, he addresses the structural problems in the system of resource facilitation and allocation in Iran.   He points out that “the main government expenses consist of subsidies and compensation for employees’ services.” (p. 41)  He asks:  To what extent has the government played a role as a stabilizer?  Nili insists that “countries that have benefited from reforms are those that have not only transferred government property [from the state to the private sector] but have also created the necessary conditions for a market-centered economy.” (p. 63)   He adds:  “serious” privatization in Iran during the past decade has been limited to 5% [of government property].    Pointing to China as one of Iran’s main trade partners and Iran’s second largest provider of imported goods after the Emirates,  he writes:  “China’s role as an emerging economic superpower and an important player in the international political scene which considerably needs energy imports and specifically oil and gas,  can be a determinant in the relations and conflicts between Iran and the West.”(p. 65)  However he expresses concern because “if Iraq takes Iran’s current place in the global oil market,  what consequences would this development have for the Iranian economy?”(p.66)  Nili concludes that China’ response to globalization can offer an important model for Iran because China has been both dependent on internal sources of capital and external sources.”(p. 70)

Mehrdad Vahabi,  argues that Iran’s economy is not under the control of its government but under the control of parastatal institutions.  These institutions are economic spheres that work under the protection of security forces.  They consist of the following:  The Foundation for the Oppressed and the Disabled Veterans (Bonyad-e Mostaz’afan va Janbazan) which is the financial source for the power held by the Guardian Jurist (Vali-ye Faqih);   The Khatam al-Anbiya Construction Headquarters  or Ghorb, the financial source for the power held by the Islamic Revolutionary Guard Corps (Sepah-e Pasdaran);  Astan-e Qods-e Razavi and  9000 shrines, the financial source for the power held by the clergy;   The Imam Khomeini Relief Foundation, the financial source for the power held by paramilitary forces such as Basij and Ansar-e Hezbollah.  They have a tax exempt status,  as well as preferential access to credit and foreign exchange,  and are not supervised by official government offices.   Hence, they are neither part of the state sector nor part of the private sector. (Taheri, 2014)

According to Vahabi,  the Iranian economy is divided into protected and non-protected parts.    The  protected part  is directly supported by military forces.  He also emphasizes that industrial and manufacturing production in Iran is only conducted in relationship to military industries, communications and  non-military industries such as automobile production which are related to the activities of the military industry.  (Taheri, 2014)

One of the main points in Vahabi’s argument is that the Islamic Revolutionary Guard Corps is not economically efficient and effective in generating profit and optimizing capitalism.  On the contrary,  it pursues the short-term interests of its contractors.  Hence,  it does not move in the direction of creating a centralized economy.  Instead,  it is a “parallel state” that “promotes deinstitutionalization and organized anarchy.”   (Vahabi, 2015)

Vahabi calls this method of operation,  “destructive coordination” and considers it  an “Iranian Disease.”  He emphasizes that its basis is the conflict between the traditional polycentric structure of Shi’a clergy and the logic of centralized power held by the Guardian Jurist.  This “Iranian Disease”  is also based on “the conflict between a theocratic regime and the exigencies of governance in a society going through modernization.”  (Vahabi, 2017)

He concludes that the only way to combat “contending and parallel institutions”  in Iran and end their confiscations and violence is to do the following:  Take away the Islamic Revolutionary Guard Corps’s control over the oil, gas and financial sectors of the Iranian economy and  turn the oil and gas industry into state property.   He advocates turning parastatal enterprises into state property in order to determine the exact amount of their property,  and to subsequently  really privatize these enterprises.  He also advocates centralizing  social security services in the hands of the state.  (Vahabi 2015)

Mohammad Maljoo agrees with Vahabi on the need for an efficient government.  He argues that “the key crises which are the foundation of other crises are the following:”  1. The crisis of wealth inequality:  Legal, quasi-legal and illegal expropriations, privatization, commodification of many government services such as health and education which lead to the centralization of wealth in the hands of a minority at the expense of the majority.  2.  Disruptions in the social reproduction of the labor force:  A decline in the minimum wage.  3.  Increased environmental destruction.  4.  A crisis of production in the sense that the state, the private sector or the parastatal sector concentrate their resources on unproductive activities  such as promoting ideological mechanisms.  5.  The crisis of value realization in the commodity market and the service market.  6.  The crisis of de-accumulation:    “Capital removal dominates over investing.   If there is a surplus left of the productive or unproductive activities,  this surplus enters the chain of accumulation at the global level and less at the national economic level.”  “The income from oil does not trickle back into the chain of accumulation of capital within the Iranian economy but primarily trickles into higher circuits of capital accumulation in the regional or global economy.” (Maljoo, 2017)  Consequently, he argues,  the crisis of declining accumulation in the national economy has led to “the increasing weakness of capitalist production in the Iranian economy.” (Maljoo, 2016).

Maljoo also insists that “for multiple technical, political and economic reasons,  we no longer have the possibility of realizing the level of income from oil that we had prior to the oil sanctions.   We are increasingly reaching a  zero petroleum balance of trade.”  That is because oil prices in the global markets will not increase for at least ten to fifteen years.  Inadequate investment in Iran’s oil and gas facilities have increased the cost of extraction or have made extraction impossible.   Domestic demand for oil and gas and their byproducts have also increased.  As a result, faced with “the bitter reality of the end of the oil economy era,”  the Rouhani administration has increased  the rate of exploitation of the labor force and nature in order to extract what it cannot get from the oil income.  The current situation marks an uncontrollable crisis.” (Maljoo, 2017)

To confront this crisis,  Maljoo recommends the following course:  Reforming the tax system and “stopping the various mechanisms of dispossessing the masses . . . limiting the right to private property and annulling the right to ownership of endowments.  Democratizing the government’s right to claim ownership of the environment.   This approach … can prevent the oil and gas income from being funneled into a higher circuit of capital accumulation in the global economy and may untie the Gordian knot of  production in the Iranian economy within the framework of strengthening social justice and protecting the environment at least for the time being.”  (Maljoo, 2016)

It seems that the three economists discussed above agree on one issue regardless of their differences:  All want an efficient government that can promote capital accumulation and job creation.  Nili wants a government that follows the model of China.  Vahabi  wants a centralized state capitalism that can offer welfare and social services and also develops a close relationship with the private sector.  Maljoo wants a  welfare-state model of  state capitalism.

The analyses of Nili,  Vahabi and Maljoo however,  raise presuppositions and questions that need to be discussed and critically evaluated.  Hence,  in the remainder of this article,  I would like to address the following issues:  1.  What is the accumulation of capital?  Why has capital accumulation decreased in Iran?  2.  Can the  “parallel and contending institutions”  thesis  describe the specificity of the Iranian economy?  Are we facing the confrontation of the government and the Islamic Revolutionary Guard Corps or the unity of the two?   3.  What other economic, historical and social factors have been considered in examining the specificities of the Iranian economy?  4.  The need for developing an alternative that goes beyond the dualism, private capitalism/state capitalism,  and confronts militarism, exploitation,  Iranian nationalism, patriarchy  and homophobia.

2.What is the Accumulation of Capital?  Why Has the Rate of Capital Accumulation Decreased in Iran?

In his  Capital, Marx  takes issues with Adam Smith over the meaning of   “expanded reproduction” or accumulation of capital.  He argues that accumulation of capital proper isn’t simply about the return of the bulk of the surplus value extracted from the workers into the cycle of production and job creation.   The key point in Marx’s analysis is that an increasing portion of the surplus value extracted from the labor force goes back into acquiring means of production such as  machinery, technology and buildings,  at the expense of wages.   Clearly,  a portion of the surplus value also goes into the pockets of the capitalists and is used for personal consumption and a luxurious life.  But the bulk of the surplus value extracted goes back into acquiring means of production in order to increase the productivity of workers to produce more surplus value  and  to expand value as an end in itself.

That is why Marx calls the capitalist “capital personified.”   He writes:  “[I]n so far as he is capital personified,  his motivating force is not the acquisition and enjoyment of use values but the acquisition and augmentation of exchange values.  He is fanatically intent on the valorization of value . . . [W]hat appears in the miser as the mania of an individual,  is in the capitalist the effect of a social mechanism in which he is merely a cog.   Moreover, the development of capitalist production makes it necessary constantly to increase the amount of capital laid out in a given industrial undertaking,  and competition subordinates every individual capitalist to the immanent laws of capitalist production as external and coercive laws.  It compels him to keep extending his capital so as to preserve it.” (p. 739) “If in the eyes of classical economics, the proletariat is merely a machine for the production of surplus value, the capitalist too is merely a machine for the transformation of this surplus value into surplus capital.” (p. 742)

Hence,  Marx’s analysis of capitalist accumulation is far from those anti-capitalists today who simply attack Wall Street and the corporation managers with exorbitant incomes.   He is instead addressing a mode of production that leads to the logic of expanding capital as an end in itself.

Maljoo correctly emphasizes that even without the economic sanctions related to Iran’s nuclear project,  the current direction of Iran’s economy is such that a large portion of the income from the oil industry is  spent on either importing consumption goods (whose cost of production is much cheaper outside Iran)  or on nonproductive investments (such as financial speculation which have a higher rate of profit)  or investments outside Iran where there is greater security for capital and a higher rate of profit.  (Maljoo, 2017)

However,  we need to add one more factor to those which Maljoo has enumerated:  An increasing portion of the surplus value extracted from Iran’s labor force is spent on Iran’s military interventions in the region,  i.e. the purchase and production of arms,  the wages of its military and paramilitary forces,  as well as other costs related to promoting war and having an imperialist military presence.    There are no accurate figures about the cost of Iran’s military intervention in Syria and other countries in the region.  However,  considering that the Iranian regime along with Russia have been the main supporters of the Assad regime since 2012,  and considering that Iran’s military presence in Iraq, Lebanon and Yemen are still continuing,  this issue should be a preoccupation of Iranian economists both from the standpoint of crimes against humanity and from an economic standpoint.

  1. Can the “contending and parallel institutions” thesis describe the specificity of capitalism in Iran? Are we facing a confrontation between the government and the Islamic Revolutionary Guard Corps or the unity of the two?

Suzanne Maloney,  the author of Iran’s Political Economy Since the Revolution (2015) and one of the advocates of the “contending and parallel institutions” thesis argues that on the one hand,  the economy of the Islamic Republic is in many ways a continuation of the general  direction of the economy of the Pahlavi regime,  i.e.  a statist economy characterized by the unity of industry and the army.   She states that Iran’s industrial capitalism which began in the 1930s was a state-based project.  “Reza Shah’s framework for economic development—rapid industrialization, infrastructure building, and a strong central state—remained largely intact until the 1979 revolution and in many ways beyond. . . grounded in the protonationalistic centralizing tendencies of a modern military rather than tribal affinities.”(pp. 39-40).

On the other hand,  Maloney argues that the  interpretations of the Islamic Republic which are based on the pattern of postrevolutionary centralization,  and see the expansion of the state bureaucracy,  the intrusion of the government into hitherto private realms of behavior,  and the aggressive monopolization of power by the Islamists, as part of a longer-term trend toward state centralization in Iran are  “an oversimplified description of the Iranian political dynamic.  [These interpretations] disregard an important consequence of the revolution:  the reconfiguration of the state through explicitly ambiguous partition of authority and sovereignty.”  (p. 94)  She continues:  “The Islamic Republic’s establishment did not produce an unequivocally stronger and more centralized state.  Rather . . . a deliberately divided state structure, which owes its longevity to an intricate balancing act between theocracy and democracy.” (p. 95).   “The postrevolutionary government found itself vested with dual and dueling institutions of authority.” (p.99).

Maloney’s interpretation of what she calls  “dual institutions of authority” is based on the following facts:  After the 1979 Revolution, the Islamic Republic on the one hand nationalized banks and heavy industry and placed  the bulk of the economy in the hands of the state.  On the other hand,  it placed the bulk of the expropriated properties under the control of “parastatal” and “non-profit” organizations such as the Foundation for the Oppressed and the Disabled Veterans which was formed in March 1979, was tax-exempt and not accountable to the state.(p. 125)  She argues that  “overtime, the foundations became a large and consequential dimension of  the supreme leader’s political and economic influence, outside the scope of executive and legislative authority.” (p. 121)  She further argues that just as the Shah used the Pahlavi Foundation to assist favored constituencies, including the families of  police, military and SAVAK personnel,  the Islamic Republic directed  Bonyad-e Mostazafan (Foundation for the Oppressed) to support its favored constituencies.  (pp. 121-122)   Khomeini designated the Bonyad-e Mostazafan to operate separately from or outside the scope of the formal government structure,  and under the Islamic Revolution’s Council.   Thus, during the first few months after the revolution,   the foundations “helped facilitate the eventual domination of radical factions [Islamic fundamentalists] over the moderates.”(p.122).

Maloney also argues that on the one hand the constitution of the Islamic Republic gave full control of the army, the legislative, executive and judicial powers to the Guardian Jurist.  On the other hand,  article 44 of the constitution divided the country’s economic system  into three spheres:  state, cooperative and private sectors.  The state sector was by far the most expansive, comprising  ‘all large-scale and mother industries, foreign trade, major minerals, banking, insurance, power generation, dams and  large-scale irrigation networks, radio and television, post, telegraph and telephone services, aviation, shipping, roads, railroads and the like,’   as well as “public wealth” broadly described as uncultivated or abandoned land, mineral deposits, seas, lakes,  rivers and other public waterways, mountains, forests and property of undetermined ownership.  (pp.  133-134)

She concludes that this constitutional framework strengthened the dual structure of authority  which had begun with  the conflict between the interim government of prime minister Mehdi Bazargan and the Islamic Revolution’s Council in 1979.   It cemented ideological and turf battles between the parliament as the representative of the government,   and the Council of Guardians as the body in charge of maintaining the “Islamic” character of laws.  (pp. 132 and 135)

Vahabi  emphasizes the role of the Islamic Revolutionary Guard Corps (IRGC) as a parallel institution that is in conflict with the government.  He writes:  “The presence of the IRGC in the Iranian economy has been very extensive.  However, it has not been in the direction of centralization but in the direction of deinstitutionalization and decentralization.”   The IRGC, he argues,  is not an economically efficient (profit making)  institution because it is only pursuing the short-term interests of its contractors.  (Vahabi, 2015)

Here I would like to offer some questions and differing interpretations:

  1. According to Maloney, in 1979, Ayatollah Khomeini placed the foundations outside the scope of the official government’s authority in order to facilitate the domination of the Islamic fundamentalists over the moderates.    One can conclude that Khomeinin’s aim was not necessarily the creation of a permanent dual structure of power but an instrument for centralizing power in the hands of the faction that became the ruling power or the government of the Islamic Republic.  In other words,  Khomeini maintained the statist structure of capitalism in Iran but  also guaranteed the domination of Islamic fundamentalists over it.

2.According to the facts offered by Maloney and Vahabi,  the IRGC began its economic activities in 1988 after the end of the Iran-Iraq War and with the establishment of the  IRGC Cooperative Foundation.  This foundation became the Khatam al-Anbiya Construction Headquarters or GHORB in 1990 and established companies active in agriculture, industry, mining, road building, transportation, export of oil and gas.  Maloney writes that “Rafsanjani sought to utilize the resources and authority of the military to advance the reconstruction . . . in fact there was considerable prerevolutionary precedent for employing the military in this fashion.” (Maloney, p. 244)  Starting in 2004-2005,  the last year of Khatami’s government,  the economic and political role of the IRGC increased considerably.  (Maloney, pp. 342-344).  In 2006,  based on an order from Ayatollah Khamenei,  the Guardian Jurist,   80% of the state sector was transferred to the parastatal sector in the name of “privatization.”  This in turn greatly increased the control of the IRGC over the oil and gas, financial and telecommunications sectors.   Vahabi emphasizes that industrial and manufacturing production in Iran is only conducted in relationship to military industries, communications and  non-military industries such as automobile production which are related to the activities of the military industry.  (Taheri, 2014).

Based on these facts,  we cannot separate the state and the IRGC.  We also cannot  simply attribute the current decrease in the rate of accumulation of capital to the greed and imprudence of the contractors of the IRGC.  Maloney and Vahabi have themselves considered more objective factors such as the expansion of Iran’s nuclear project after 2006 which led to paralyzing sanctions,  Iran’s military interventions in the region,  the continuation of the effects of the 2008  global economic crisis, changes in energy production and in the energy market.

3.The Iranian government has not challenged the role of the IRGC in Iran’s military interventions in Syria, Iraq and Lebanon.    Under the Ahmadinejad administration, 182 members of the parliament belonged to the IRGC.  The Rouhani administration has also not challenged the role of the IRGC in preserving the Assad regime in Syria and has in fact supported this role.   During the first year of the Rouhani administration the military and security forces’ share of the national budget officially increased by more than 25%.  This year it has officially  increased by 21%.    Rouhani and other officials of his administration and leaders of the IRGC have had multiple meetings with Putin and other officials of the Russian government concerning the continuation of Iran’s military intervention in Syria.  These realities speak more of a unity between the government and the IRGC, and not a conflict.

4.The role of the IRGC, as a security force for repressing labor and popular struggles has an economic value.  Considering the government’s need for further decreasing the wages and benefits of the poorer sectors of society,  the IRGC’s role as a force to maintain the regime becomes more important.

There is no doubt that there are divisions within the Iranian ruling class concerning economic and political approaches.   There is no doubt that Iran’s capitalism is inefficient.  There is no doubt that the IRGC acts like a Mafia band.   However,  currently, it seems that the IRGC, the government (president and parliament) and the Guardian Jurist,  are all united around the goal of preserving a strong state with a smaller social welfare sector and a much larger military sector.

Vahabi argues that  “The presence of the IRGC in the Iranian economy has been very extensive.  However, it has not been in the direction of centralization but  of deinstitutionalization and decentralization.”   He continues:  “This is true in a two-fold sense:  One, the transfer of state property to the  religious and military parastatal institutions which had started earlier.  Two, the breakup and dispersal of the social security department into various self-centered institutions.”  (Vahabi, 2015)

In response to this view,  one can argue that the transfer of capital from the state to the parastatal sector has not been for the purpose of decentralization but for freeing the state of the minimum regulations and benefits which the constitution has offered the workforce in the state sector.  The transfer of capital from the state sector to the parastatal sector has in fact allowed the government/state to  further exploit the workforce without any regulations, and to spend an increasing portion of the surplus value extracted on military interventions and domestic repression.

In this context, a solution that limits itself to calling on the state to combat corruption within the IRGC,  and demands an efficient capitalism,  will not lead to democracy, social justice and combating exploitation.  On the contrary, it can simply lead to the creation of an efficient military capitalism.

According to the facts and statistics presented by the London Economist, in the emerging economies of China and Russia and the global economy as a whole, governments are tightening their grip on the commanding heights of the economy even as the private sector grows.  State-owned enterprises are becoming more powerful even as the overall state sector shrinks.  In other words, we are witnessing the unity of seemingly opposite phenomena:  The decline in the overall state sector and the increasing growth of state control over the economy to the point where eight of the ten largest companies in the world are state-owned.   In most emerging economies, the state is inseparable from the army.  In fact, the state/army is omnipresent.

It can be argued  that  Trumpism in the U.S. also aims for  an authoritarian form of state capitalism:   a state with a strong army, police and security forces,  and a small public (social services) sector.

This global trend is itself a manifestation of the logic of capital which moves in the direction of the centralization and concentration of capital in order to increase the rate of profit,  and uses military means to repress any resistance to oppression and exploitation at the workplace and in society as a whole.

4.What other economic, historical and social factors have been considered in examining the specificities of the Islamic Republic’s  economy? 

Suzanne Maloney points to the convergence of four influential factors:  1.  A deeply rooted mistrust of Western interest in Iranian resources in light of the history of foreign interventions in Iran.  2.  Reliance on oil revenues as the main source of income.  3.  Bifurcated authority.  4.  Epic changes in world trade and economic growth that have brought about the rise of emerging economies such as China and Russia.

Many economists have addressed the fact that the Iranian state relies on the income resulting from oil and gas extraction to make up for the decline in the rate of accumulation of capital.  It is also increasingly using natural gas for domestic energy consumption to promote its proclaimed “economic self-reliance.”

The role of Russia and China both in investing and in selling arms to Iran,  has been another widely discussed issue.  The formation of the Islamic Republic in the context of massive changes in world trade, globalization and the rise of emerging economies such as China and Russia has meant that the Islamic Republic has been able to count on their support in terms of trade and arms supplies.  Without the support of these states and other emerging economies such as South Africa and Brazil, the Islamic Republic could not boast about its “economic self-reliance.”

It is also important to point out two other influential factors:

  1. Iranian Shi’a nationalism as a means for justifying domestic repression and military intervention in other countries of the Middle East region.
  2. Patriarchy and misogyny promoted through laws related to compulsory veiling, divorce, custody of children, polygamy, temporary marriage and limitations on women’s employment and travel rights are ways of giving economic and social benefits to men. These are benefits which men will not have in the absence of the Islamic Republic.    Of course,  some of these laws,  specifically concerning the limitations on women’s employment,  cannot last in a capitalist economy in the long range.

Addressing these two issues in the context of the factors enumerated above can help us in defining an  economic and social alternative.   Here instead of offering further details on the factors shaping the  Iranian economy,  I would like to address the question of an alternative in a more general way.

  1. The need for developing an alternative that transcends the dualism, private capitalism/state capitalism, and challenges militarism, exploitation, Iranian nationalism, patriarchy and homophobia. 

As discussed earlier,  the solutions offered by Iranian economists mainly center on a combination of state capitalism and private capitalism and  are either based on the Chinese model or a more democratic model which includes tax reform and an increase in government services.

For example,  according to Mohammad Maljoo,  “decommodifying” labor, health and education is equivalent to making them part of the state sector.    However,  he does not address the question of commodification in the Marxian sense  of alienation in labor, life and human relations.  He does not address the domination of the process of production over the human being and how it alienates us not only from the products of our labor but also from our capacity for a free, conscious, thoughtful existence,  and from other human beings.    This alienation characterizes capitalism whether it is controlled by private capitalists or by the state.

Considering the experiences of totalitarian state capitalism in the Soviet Union and Maoist China,  authoritarian forms of  state capitalism in China and Russia today,  and  the failures of  the welfare state model of state capitalism,  one can argue that proposing state capitalism as a solution is not realistic.

Parviz Sedaghat,  a leftist Iranian economist urges us to think more deeply about the question of an alternative to capitalism.   In a recent article, he writes:   “The global system is undergoing one of its most acute crises.  In my opinion,  this system is not acceptable . . . Under a capitalist economic system,  the domination of the law of value,  i.e. the transformation of labor power into a commodity,  and the domination of  decision making based on the self-expansion of value,  we will see the continuation of the alienation of human beings from the products of their labor,  the labor process and ultimately from themselves and from each other.   In other words,  ultimately,  if we want humanity to survive,   a system based on the infinite accumulation of capital  and the alienation of human beings from themselves, society and nature has to end. “

Sedaghat continues:  “Under these circumstances, an effort to create a progressive alternative,  first has to offer a correct explanation of the reasons for the failure of revolutionary movements and reformist experiences in the 20th century.  On the other hand it has to answer the following question:  In light of the quantitative and qualitative changes in the working class on the one hand and the rise of new revolutionary subjects on the other,  which forces and new social classes are the new revolutionary subjects?  Furthermore,  is it possible to elaborate an alternative to capitalism in a national framework?  Subsequent questions concern the specificities of the alternative system.    Not the specificities of the alternative in the long range but the specificities which it has to embody in the direction toward that goal.  Finally,  which practical steps have to be taken in this context?” (Sedaghat, 2017)

The views of Sedaghat represent an encouraging rethinking which can lead to fruitful discussion.  In response to his question about practical steps toward creating a progressive alternative,  I think the most immediate practical step is the creation of regional and global solidarity against militarism.  In the face of the current crisis-ridden economy in Iran and the rise of the wave of neofascism on a global scale,  Iranian socialists cannot move forward without taking a stance against Iran’s military intervention in Syria.  The Iranian government’s support for the Assad Regime’s destruction of the Syrian people’s revolution  has been one of the main factors leading to the death of half a million Syrians and the displacement of 12 million or half the population during the past six years.   This military intervention  has also been one of the main factors leading to the growth of ISIS, Al Qaida and other Jihadists.  It is incumbent upon Iranian socialists to take a stance not only against U.S. imperialism,  and against  the imperialist policies of  Israel, Turkey, Saudi Arabia and other Gulf states, but also against Iranian regional imperialism and Russian and Chinese global imperialism.   We need to reach out to the Syrian people and the Syrian refugees who are opposed both to the Assad regime and to ISIS, Al Qaida and all forms of religious fundamentalism.  Our goal should be to develop solidarity with all social justice struggles,  women’s rights struggles and the struggles of the Kurds,  Bahais and other oppressed minorities including sexual minorities. Without this solidarity,  developing a humanist alternative to capitalism is impossible.

At this  time,  the candidacy of Ebrahim Raisi for presidency  in Iran’s upcoming show elections reveals even more clearly the unity of the government, the Islamic Revolutionary Guard Corps and the Guardian Jurist.

Iranian socialists who  live abroad and in countries where they still have the right to free expression, have a responsibility  to become active in opposing the Iranian regime’s military interventions in the Middle East.  We need to show the connections between this militarism and the deplorable conditions of Iranian workers, the unemployed, women, oppressed national, religious, and sexual minorities.   We need to address militarism as the logic of capitalism.

I began this presentation with some economic facts, offered a critical evaluation of the analyses presented by Iranian economists,   and  raised the need for developing a humanist alternative to capitalism/militarism.    In that spirit, I invite listeners to read other articles in which I have examined Marx’s concept of an alternative to capitalism,  how it is different from totalitarian Communist systems and how capitalism is intertwined with racism, sexism and homophobia.  Here,  I would simply like to conclude by saying that Marx’s concept of an alternative offers us starting points for creating a non-alienated type of  human existence.  It is a perspective that needs to be discussed critically in relationship to the specificities and needs of the world and Iran today.  At a time when pragmatism/utilitarianism have become dominant and the world  is headed toward death and destruction,  the idea of developing a humanist alternative to capitalism/militarism,  and  solidarity with social justice struggles in the Middle East and the rest of the world seems to be the only practical alternative.

Frieda Afary

May 3, 2017


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