Iran Analysis: "Sanctions May Weaken Domestic Opposition" (Mansourian)

Hani Mansourian writes for Muftah:

....There can be little doubt that the civilian population of Iran, and not its government, will bear the brunt of the sanctions.

The impact of the sanctions has and will likely continue to have far-reaching effects on the Iranian economy.  As has already been evident, in the short-term the country’s economy will be pervasively damaged by the flight of private capital, stagnation (potentially coupled with inflation) and insufficient foreign exchange reserves to maintain a low exchange rate. In the short time since the sanctions were imposed, many Iranians have already felt the effect of “unsteady supply chains and disrupted exports”.

These short-term effects, in turn, will inevitably lead to significant budget deficits, which will necessitate cuts in government spending that will inevitably have more long-term effects on the country and population at large. The history of sanctions illustrates that non-democratic governments are unlikely to respond to economic pressure by cutting spending in areas they deem necessary to maintaining their power, such as defense and intelligence programs. As such, the first layer of economic cuts are usually applied to government-supported public sector programs, such as education and healthcare. In the 1980s, Iraq had the best education system in the Arab world and a primary school enrollment rate of 100%. By the year 2000, multiple wars and lack of investment in the education system left 23.7% of children between the ages of 6-11 out of school. “A sharp decline in adult female literacy rates [in Iraq] since the mid 1980s, from 87% in 1985 to … 45% in 1995” has also been documented. 

Job creation, particularly for Iran’s burgeoning young population, is one area that is likely to be particularly damaged by sanctions....

Many years of sanctions coupled with sub-optimal economic policies in Iran have resulted in a weak economy and a fragile middle-class. The latest round of UN, U.S., and EU sanctions on Iran is likely to drive millions into poverty and destitution. As economic opportunities for the growth of a solid middle-class disappear, the young Iranians that have historically been the agents of change in the country will lose their social base.  Ironically, then, sanctions may do more to increase the power of the Iranian government and to weaken the domestic opposition movement, to the ostensible detriment of U.S. interests.

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