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Saturday, August 13, 2005

Iran's Hardliners against Opening up the Economy

No financial control

Qantara:.....This enormous economic potential is neither under public control nor does it face the scrutiny of the tax authorities. The foundations are under the exclusive and direct control of the Supreme Leader of the Islamic Revolution. The proceeds from the bonyads are funneled to the conservative network surrounding Khamenei, who also maintains close personal ties to the foundations through family connections.

The funds serve as a shadow budget, which can be used to bypass the government to make policy as the need arises. They cover costs ranging from the transport of loyal demonstrators to Tehran for mass rallies to the financing of the Lebanese Hezbollah – by-passing any form of control by the government or Parliament, or even providing them with information on such activities. Well-financed through the proceeds of the foundations, the advocates of a hard line maintain a parallel power structure under their exclusive control.

The second economic pillar of the system is the bazaar. The cooperation between traders and the mullahs arose during the reign of the Shah, when he attempted to force the country to modernize and open up to foreign companies. The bazaar traders regarded this as a threat to their trading monopoly and, as a result, threw their support behind Shiite clergymen in opposing the Shah.

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