The Latest from Iran (17 October): Back to Semi-Normal

The Latest from Iran (18 October): Semi-Normal, Indeed - Khamenei, Bahari, & Hajjarian
Iran: The Great Supreme Leader Health Mystery
Iran: The Supreme Leader Lives --- The Picture (17 October)
Iran: The Daily Show Tribute (Persian and English Versions)
A Brilliant Neo-Con Idea: Crippling Iran to Save It
Iran: A Beginner’s Guide to the Economy, Past and Present
The Latest from Iran (16 October): Rumours and Drama, Khamenei and Karroubi

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1855 GMT: We're taking a Saturday night off to recharge mental batteries. The discussion board should be buzzing all night, however --- take a look at the sharp-eyed comments on the separate entry about the Supreme Leader's pictures --- and your ideas and thoughts are invaluable to us.

Before we go, an apology. In another prominent entry today, I referred to the Persian language as "Farsi". This, of course, is an error, and I will endeavour not to repeat it. Thanks to readers who gently brought the mistake to my attention.

1850 GMT: The Government Fights On Over Detainees.
Mohammad Reza Mogheyseh, who became the head of the Karroubi-Mousavi special committee investigating prisoner abuse cases after the arrest of Mousavi advisor Alireza Beheshti in September, was taken from his home and detained at 4 a.m. Mogheyseh is a well-known war veteran who has helped amputees and families of the dead.

http://www.kaleme.com/1388/07/25/klm-637

1810 GMT: Conservative Resurgence Against Ahmadinejad? The high-profile conservative member of Parliament, Ali Motahari, had been quiet recently after repeated complaints about the President during the summer. However, in an interview today he has said that conservatives should admit to the wrongdoings of Ahmadinejad, and considering the facts without prejudice and judging fairly.

Perhaps even more significantly, given talk of the National Unity Plan, Motahari complained that Ahmadinejad supporters are insisting that there should be no national unity unless “leaders of the conspiracy” admit to their mistakes and apologise to the people or even be prosecuted. Motahari insisted those supporters should consider that Ahmadinejad started the “conspiracy” with his remarks during the election campaign and in his “victory” speech. (English summary via Facebook page linked to Mir Hossein Mousavi)

1800 GMT: Reuters is reporting, from Iranian Labor News Agency, that Iranian-Canadian journalist Maziar Bahari has been released on $300,000 bail.

1740 GMT: We've updated in the separate entry on the photographs of today's reported appearance of the Supreme Leader. Meanwhile, Press TV has brought out an English-language version of the meeting with the President of Senegal, focusing on Khamenei's call for support of "oppressed Palestinians".

1640 GMT: He's Alive! The Supreme Leader's website has poted the first picture of Ayatollah Khameini since the recent rumours of ill health. We've got the details in a separate entry.

1625 GMT: Salaam News reports that the weekly gathering of mothers and family members of victims of post-election violence, held in Laleh Park, was disrupted by police and security forces who used tear gas.

1545 GMT: Mowj-e-Sabz and Rouydad claim that leading reformist politician Saeed Hajjarian has been given a five-year suspended prison sentence after four months in detention. The Iranian judiciary has not yet been confirmed the reports.

1415 GMT: After a four-day break, the English-language Tehran Times is publishing again, with stories such as Iran Foreign Minister Manouchehr Mottaki's warning to his US counterpart Hillary Clinton, "Avoid ‘Useless Slogans’ Used in Bush Era".

1250 GMT: Radio Free Europe/Radio Liberty posts more details about those recently sentenced to death in Iran, including Hamed Rouhinejad. (Curiously, they report four rather than five condemned.)

1150 GMT: National Unity Plan Alive and Well? After days with little news of the Plan, Deputy Speaker of Parliament Mohammad Reza Bahonar has confirmed that he is on the panel working on the proposal. He told journalists, "Don't rush on reporting details," expressing confidence in the success of the initiative. The article from Aftab News claims that, although Government supporters have been hostile, the majority of Parliament supports the plan.

1140 GMT: A Sign of Conciliation? Tehran's police chief has called for unity and admitted that "the Basij [militia]'s image needs to be repaired". Perhaps most importantly, he has accepted street marches as long as they are peaceful.

The statement follows recent comments by Iran's police chief, Esmail Ahmadi-Moghaddam, that said demonstrations would be tolerated if they were within the law.

1130 GMT: News or Disinformation? Raja News, a fervent opponent of the Green movement, claims that supporters of Ayatollah Dastgheib, an equally vehement critic of the Government, stormed the office of the Friday Prayers committee in Fars Provine and beat a cleric who supports the Supreme Leader. The newspaper also features a statement from the "community and clergy" reiterating the electoral turnout of 85 percent and Ahmadinejad's tally of more than 24 million votes.

0935 GMT: Fars News, on its English-language site, has reiterated the denial by "Iran's diplomatic sources" of the rumours of the Supreme Leader's illness. The article is more shorter than the Farsi-language "analysis" posted on Friday (see yesterday's updates), linking the rumours to a Western campaign for velvet revolution.

Significantly, Fars refuses to note that it was an Iranian website, Peiknet, that posted the first report of Ayatollah Khamenei's health problems, instead pinning the rumour on a long-time bogeyman, Michael Ledeen. And, perhaps equally significantly, the denial still comes from relatively low-ranking Iranian officials --- the two are "on record", though not named in this article, are based in Armenia and Belarus.

0730 GMT: Now for the Government's Next Threat. A prosecutor has told the Islamic Republic News Agency that, after "several hundred" complaints from the public, Mir Hossein Mousavi may be brought before the Media Court to be punished.

0640 GMT: Press TV is intent on building up Iran's international stature today --- Iran sends special envoy to resolve crisis in Yemen, Jannati at Friday Prayers declares "Western powers have finally realized they cannot have the final say on Tehran's nuclear issue", Iran calls for war crimes trial of Israeli leaders. However, it does stray from this line for one economic story of note: "Iran's drug companies are facing a financial crisis due to unpaid debts of more than $300 million".

0625 GMT: A much quieter day so far. The chatter about the Supreme Leader's health has eased, and after a flurry of back-and-forth challenges between the Government, Mehdi Karroubi, and Mir Hossein Mousavi, no one has made any moves (though, if past experience is a guide, the battling could pick up this afternoon).

While life and politics can never be labelled normal in Iran after 12 June, there is a semblance of steady-as-she-goes today. Still, as a reader reminds us, even "semi-normal" qualified. Five post-election detainees remain on death row pending their appeals; a "deeply troubled" United Nations Secretary-General Ban Ki-Moon has now spoken on the issue through a report to the General Assembly: “The handling by authorities of the protests that followed has raised concerns about respect for freedom of expression, assembly and association, the use of force in policing demonstrations and the treatment of and due process afforded to detainees."

Iran: The Supreme Leader Lives? The Picture (17 October)

NEW Iran: The Great Supreme Leader Health Mystery
The Latest from Iran (17 October): Back to Semi-Normal
The Latest from Iran (16 October): Rumours and Drama, Khamenei and Karroubi

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URGENT UPDATE 1755 GMT: EA's Mr Smith may have solved the mystery in favour of a "true" meeting. He has discovered a set of photographs on the Fars News site of the official reception at the Presidential compound for the Senegalese President, who is dressed in the same fashion as in the photograph with the Supreme Leader. Khamenei's office is only two blocks from the Presidential compound.





UPDATE 1645 GMT: We're doing some checking to address the obvious question of whether this is a photograph from today. The Supreme Leader also met President Wade on 28 June 2006 and on 28 February 2008, discussing the issue of Western pressure on Iran's nuclear programme.

The Supreme Leader's official websites have posted a picture of Ayatollah Khamenei meeting with the President of Senegal, Abdoulaye Wade, and President Ahmadinejad today. The accompanying article expressed the Supreme Leader's satisfaction with "development of trade, industrial and economic links between the two countries". Khamenei also praised the Islamic Conference Organization, of which Senegal is currently the President, for its pursuit of the Palestinian issue.



The Islamic Republic News Agency's site has a space for the photograph but no picture. Fars News has a similar version of the story but curiously uses a photograph from the 2006 meeting.

The Latest from Iran (16 October): Rumours and Drama, Khamenei and Karroubi

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1945 GMT: The English-language website of Mowj-e-Sabz has a short summary of the Mousavi-Khatami meeting (1500 GMT).

1830 GMT: After a four-day absence, fueling speculation of a connection to the ill health of the Supreme Leader (0645 GMT), the newspaper Kayhan has reappeared today.

1515 GMT: The Battle Goes On. Yesterday Karroubi made clear his intention to stand firm against Government threats of arrests. So today the Government reiterated the warnings. The deputy head of Iran's judiciary, Ebrahim Raeesi, has repeated to the Islamic Republic News Agency that the consideration of charges is "very serious".

1500 GMT: Mousavi and Khatami Meet. Parleman News summarises a discussion between Mir Hossein Mousavi and Mohammad Khatami, who asserted that the Iranian nation will not be diverted from its course by "force and pressure". The post-election movement had awakened Iran to the blessings of Islamic Revolution, especially its path toward justice, freedom, independence, and honour, and it would not deviate from its attachment to those ideals."

1345 GMT: Nice response to today's Friday Prayers on Twitter: "Hey Jannati, thanks for the free publicity! You told WAY more ppl about 13 Aban [4 November demonstrations] than the Greens could!"

1255 GMT: HomyLafayette has posted a summary of Ayatollah Jannati's Friday Prayers (see 1015 GMT):

"Jannati warned Greens against trying to exploit anniversary of the US Embassy takeover, 4 November [13 Aban]. He said that their schemes...will be neutralized. Some people who are tools of others want to show their American and Israeli natures on 4 November. If judiciary and security apparatus treat protesters with leniency, they are traitors to Islam and the Revolution."

1235 GMT: In the Midst of Uncertainty, Comedy. Fars News' fumbling attempt to turn the Khamenei health rumours into high evidence of the foreign-directed velvet revolution is book-ended by Michael Ledeen's latest entry onto the stage.

Ledeen's feigned modesty, "I have been given more credit than is absolutely necessary," is belied by his failure to acknowledge the true source of the rumour --- the Peiknet report of doctors at Khamenei's house --- and his surprise at the supposed outcome of his words, "It follows that I effectively shut down the Tehran Bazaar!"

What is most entertaining, however, if contributing nothing at all to knowledge are more Ledeen claims into the air --- "Not only was the Bazaar closed, but there seems to be a run on staples, as people stock up against the possibility of unsettled times" --- and this far-fetched explanation (from "Iranian friends") of the most prominent denial of the rumours so far: "The people at Tabnak believed I had it right, and they put it up in order to say “hey look at this! The Americans know our most secret secrets.”

1055 GMT: Khamenei's Health Rumours? Blame the Velvet Revolution. OK, we've got a long, convoluted denial of the health scare story, courtesy of Fars News. According to their "analyst", this is all part of the post-election scheme, similar to undermine the regime (the Government's bogeyman, financier George Soros, even makes an appearance). And the author is pointed in drawing a comparison with the rumours in 2007 of Khamenei's demise.

1015 GMT: Friday Prayer Update. Ayatollah Ahmad Jannati, using the analogy of Imam Sadegh, the 6th Imam, has declared that the issues of security in the Islamic Republic are due to "a lack of respect".

0900 GMT: Bad news for John Hannah, the former advisor to Dick Cheney who is trying to "help" Iran's people by crippling the economy (0845 GMT). China just made it clearer than clear that sanctions are not on the agenda. Chinese Premier Wen Jiabao, at a Thursday press conference his guest, Iran's First Vice President Mohammad Reza Rahimi, declared, "The Sino-Iranian relationship has witnessed rapid development, as the two countries' leaders have had frequent exchanges, and cooperation in trade and energy has widened and deepened."

0845 GMT: We've posted two special analyses this morning: our newest correspondent, Mohammad Khiabani, introduces readers to the issues in the Iranian economy, while Maryam from Keeping the Change takes on the former Bush Administration official who is advocating harsh economic sanctions "on behalf of Iran's people".

0645 GMT: At one point yesterday, caught up in the rumours of the Supreme Leader's illness or death, I was inappropriately reminded of a classic sketch from the US show Saturday Night Live, in which newscaster Chevy Chase would sombrely inform the audience, "Spain's Generalissimo Francisco Franco is still dead." (Trust me, I'm looking for the video clip.)

Well, Franco is still dead and Ayatollah Khamenei is still not dead, as far as we know. There are indications that something is amiss in Iran: the "hard-line" daily Kayhan has not published since Monday, the English-language Tehran Times has been silent since Tuesday. The Supreme Leader's official sites, leader.ir and khamenei.ir, have not denied the rumours. Leader.ir has been quiet for a week and khamenei.ir refers the reader to the one Iranian newspaper responding to the rumours: Tabnak denounces the US activist Michael Ledeen (who, just as a reminder, was not the original source for the current round of Khamenei rumours; that honour goes to Peiknet, a website associated with "left" Iranian exiles).

The one counter-indication is a note on the Facebook site run by Khamenei supporters, which claims the Supreme Leader was present Wednesday at the rites for Imam Sadegh. If that was true, however, one would expect to have seen the news elsewhere in the Iranian press. So here's our own position: we're on watch, but making no conclusions. If there is no official denial by the end of today, then we will begin thinking that there may be substance to the original Peiknet report.This is not that Khamenei has died, but that he is too ill to be in public.

Part of our caution on the Supreme Leader story is because it is obscuring political developments which are both 100% confirmed and 100% significant. The headline event yesterday was Mehdi Karroubi's defiant response to the Government threats to arrest him. He not only refused to withdraw his allegations of the system's abuses; he promised a doubling and re-doubling of evidence if he was charged.

The initial read is easy: Karroubi will not lie down. Just as in August, when he was threatened with court action, just as in September, when he was told by Ali Larijani to be quiet, the cleric has responded by making himself visible and heard. And this is being achieved despite the Government's 24/7 surveillance on Karroubi and his house.

The more difficult read is whether this marks another surge in the opposition movement. That, as we noted earlier this week, cannot rest on Karroubi alone. Hashemi Rafsanjani appears to be in a phase of fighting for his personal position, but Mir Hossein Mousavi joined Karroubi's most recent push, the meeting of last Saturday. Will he make an appearance this weekend, despite his own difficulties in moving (and even talking) under the regime's gaze? And what does the Green Wave take from yesterday's remarks of the man who some are calling "Obi-Wan Karroubi" (Yes, really.)?

The demonstrations of 13 Aban (4 November) are 19 days away.

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2010 GMT: Our Daily Contribution to the Khamenei Death Rumour Mill. The Supreme Leader's Facebook site has the following message from Wednesday, "Today Noon; Ayatollah Ali Khamenei, Supreme Leader of Iran attended a rite in respect of Imam Sadeq(A.S)".

If true, this would disprove Tuesday's Peiknet story, the original source of the current health rumors, that the Supreme Leader had been confined to his house by doctors.

1620 GMT: A Dutch Member of Parliament, Harry van Bommel, has urged Foreign Minister Maxime Verhagen to take further action against the imminent execution of Iranians sentenced in post-election cases:

Protest at the European level is not enough. The Netherlands should also use its own channels. There is an escalation of political oppression in Iran and we should react to that by using heavier diplomatic means....To prevent the eradication of any kind of opposition in Iran, the Netherlands must act now.

Human rights is one of Verhagen's policy priorities, and he can be contacted in English or Dutch via Twitter.

1545 GMT: Mehdi Karroubi has responded --- big-time --- to Government attempts to arrest him over his allegations of abuses of detainees. We've got the details in a separate entry.

1405 GMT: Fereshteh Ghazi has posted an interview with  the lawyer of Arash Pour-Rahmani, who was sentenced to death for subversive activity last week. Her headline is a blunt description: "Close to Death but Clueless".

1400 GMT: Iranian authorities continue to prevent filmmaker Jafar Panahi, who was briefly detained on 30 July, from leaving the country.

1110 GMT: President Ahmadinejad has used the setpiece of a meeting with an Egyptian writer and scholar to declare that further US sanctions on Iran are unlikely: “In a status where countries are seeking free trade, talk of embargoes is meaningless. At any rate, they have already imposed sanctions against our country, but achieved nothing. The world is a big place and all states are not controlled by a certain bullying regime."

Of course, this could be read as defiance but another reading is that Ahmadinejad is signalling that productive engagement is alive and well.

0900 GMT: Yesterday we noticed the latest message from Grand Ayatollah Montazeri, delivered after his class at Qom's seminary, challenging the Revolutionary Guard. An EA correspondent adds details of the statement:

As Ayatollah Khomeini has said, the Army, Revolutionary Forces, and Basij militia must not interfere with the political affairs as it would be very dangerous for the country. These forces should use their power against the enemy not the people and friends.

Statements that protecting the Islamic republic is obligatory only apply if the Islamic system is loyal to its values and slogans.

The values and the slogans of the Islamic Republic are "Independence, Freedom, and the Islamic Republic". Independence means not to be obedient to a superpower. Freedom is having the freedom of speech and the belief that the opponents will not be put behind bars. Republic means a system based on people's votes and finally Islamic means that the system should be based upon the Islamic values.

0815 GMT: Amidst the rumours about the Supreme Leader's health, there will be some terrible "analysis" today, but the blogger Allahpundit takes an early lead in the competition. It's not so much that he/she declares "Irresponsible Rumor of the Day" and then treats it as true for his/her thought. It's more that the speculation is awful:

Before the summer uprising, the odds-on choice to succeed [the Supreme Leader] was Rafsanjani....One possibility is [now] the Ayatollah Mesbah Yazdi, Ahmadinejad’s own personal “spiritual advisor”....Another possibility is that the [Revolutionary] Guard will simply finish the process started this summer and stage a full-blown military coup, installing Ahmadinejad or Jafari as dictator and taking things from there....The third possibility is the likeliest — namely, finding a puppet from among the clerical ranks who can be sold to the west as a 'pragmatist' or 'reformist' while letting the Guard control things behind the scenes.

0625 GMT: Amidst continuing chatter --- all unconfirmed --- about the declining state of the Supreme Leader's health, including claims that the Tehran Bazaar is talking about Ayatollah Khamenei's passing, this line stands out: "Obviously, every rumor about Khamenei’s death to date has been false."

0615 GMT: Meanwhile, in the "West", there has been a notable switch from the nuclear issue to "human rights" to challenge the Obama Administration's engagement with the Ahmadinejad Government. This morning's Washington Post editorial endorses the latest speech by Iranian lawyer and Nobel Prize laureate Shirin Ebadi: "Mr. Obama has extended the hand of friendship to a man who has blood on his hands. He can at least avoid shaking the hand of friendship with him." Tehran Bureau, increasingly prominent as a site for the views of the Iranian diaspora, features Setareh Sabety's comment, "I do not want my President, who made me cry with his words of justice and freedom, who made me think that the impossible was possible, to shake the hands of the murderer of my children."

0600 GMT: More "Information"? Could be coincidence but Javan Online, the newspaper associated with the Revolutionary Guard, has followed its story on Hashemi Rafsanjani with a purported statement from Ayatollah Mahdavi Kani on the post-election protests. Mahdavi-Kani was named as co-author with Rafsanjani of the draft National Unity Plan, published by Fars News in late September, the incident that prompted Rafsanjani's denunciation on Tuesday of "false news".

Meanwhile, Javan's lead story is another purported analysis of US-supported regime change.

0500 GMT: A rather strange day on Wednesday.

We watched for signs of political movement from Mehdi Karroubi and Hashemi Rafsanjani; what we saw was the extent of the Government's attempts to break their challenge.

The headline story of the Government's threats to prosecute Karroubi and Mir Hossein Mousavi was supplemented by accounts of the restrictions on the movements of both men. With constant surveillance and pressure by Government forces, they are confined to houses for long periods and, in the case of Mousavi, reportedly corresponding by written messages inside the home.

As for Rafsanjani, who is free to move and who holds key positions inside the establishment, he faces the Government distortion of his words and views. It also should not be forgotten that the regime maintains the threat of prosecution of his family members if the former President should move too far out of line.

A reader writes passionately, "Rafsanjani has no power any more and he lost it all trying to resolve his personal agenda." That's a fair challenge, especially given Rafsanjani's cautious and perhaps over-complex approach to politics, but I think it minimises the extent of the Government's fightback against a dangerous foe, especially after his mid-July Friday Prayers.

I also think that, as the Government is doing, one has to keep all the leaders in the picture. Individually, Karroubi, Mousavi, and Rafsanjani (as well as others like former President Khatami and senior clerics) can only have limited effect in the campaign for "reform" of the Ahmadinejad Government and Iranian system. It is only when there is both the movement of Rafsanjani inside the establishment and the challenge brought by Karroubi-Mousavi from outside --- again, a convergence we saw in mid-July --- that President Ahmadinejad and his allies are on the defensive.

Logically, then, the Government's approach is divide and rule. If Rafsanjani can be threatened and distorted into a strategy of gradual --- very gradual --- steps and Mousavi can be bottled up, then Karroubi's persistent statements are mere annoyances.

So is that it, then? Not quite. The paradox is that the umbrella political term in Iran right now is "National Unity Plan". Indeed, the Javan "information" that Rafsanjani supported Ahmadinejad's 2nd-term Government was put out in the context of a political meeting on that Plan.

We still don't know the details of the current draft Plan, from amongst the confusing reports of recent weeks, but any "National Unity Plan" which does not take some account of the opposition of past months will be seen as far from unifying.

And, yes, even that could be successful --- can Mousavi, Karroubi, Khatami, and the dissident clerics summon up the strength for another confrontation? --- were it not for another looming presence. The Green movement has been quieted and limited by time and Government restrictions, but it has not been vanquished. And 4 November, the day of the next major demonstration, is now less than three weeks away.

The Government restrictions have lengthened the political game --- we now see patterns in months, rather than weeks or days --- but it has not won it. No amount of surveillance, disinformation, or threat of prosecution can cover up that reality.

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2025 GMT: Grand Ayatollah Montazeri has issued a thinly-veiled challenge to the Revolutionary Guard through another statement. Focusing on the abuses of the armed forces, he declares, "Some think that because they have guns they should exercise the power of their guns and use it everywhere. In any society that wants to be obedient, its armed forces should not be cruel but rather be compassionate and merciful."

2000 GMT: Remember how we started this morning with a letter from Hashemi Rafsanjani, criticising and warning about "false news" to discredit him? Well, consider this from Javan Online, a publication closely linked with the Revolutionary Guard, as reported by Tabnak:

"Since the inauguration of the 10th administration, I believe in its legitimacy. Presently Mr. [Mahmoud] Ahmadinejad attends the Expediency Council meetings as president, with invitations signed by myself," Rafsanjani said in a meeting with Iranian political figures in favor of the national unity plan.

It's not surprising that Javan would put this story, whether or not it is accurate. What is surprising is that, in light of Rafsanjani's warning that the only reliable news about him would come either from his website or the offices of the Expediency Council, an important website like Tehran Bureau would reprint Javan's claim without reflection.

1850 GMT: Amidst a quiet domestic news day, we've picked up on the international story missed by most of the media, "Iran-US-Russia Deal on Enrichment, The Sequel".

1500 GMT: The Facebook page associated with Mir Hossein Mousavi has responded to the Government threats to take Mousavi and Mehdi Karroubi to court with the reminder, "In case of the arrest of any of the Green movement’s leaders, we will take to the streets from 'Revolution' to 'Freedom' Square. The network [will use] media mobilization (SMS, email, flyer, wall notices, posters, Internet) for raising widespread awareness until the emergence of the Green army . (English summary via Iran News Digest)

1250 GMT: Amidst a lull in political developments, and as part of our increasing attention to the economic context, we've posted a two-part video from Press TV examining (and ultimately selling) President Ahmadinejad's economic proposals.

0805 GMT: We've posted what I think may be one of the most revealing analyses from within Iran, written by Dr Mahmoud Reza Golshanpazhooh, on the country's international position, "Tehran’s Growing Confidence Against the Israeli Threat".

0655 GMT: According to Peykeiran, a fifth death sentence over post-election conflict and "subversion" has been handed out to a "Davoud Mir Ardebili". The report claims that Ardebili is not a monarchist, the allegation made against three other condemned men, but merely called a radio station to report union protests.

0650 GMT: Today's Puffing of the Chest. Brigadier General Hussein Salami, the deputy commander of the Islamic Revolution Guard Corps says,"Unlike the wrong conception of the enemies, Iran is strong and invincible."

No further comment or meat-related jokes necessary.

0640 GMT: Watching the Economy. Press TV's website has a must-read story betraying nervousness over both Iran's economic situation and the politics around the headline measure, Ahmadinjead's proposed subsidy reform.

The story begins with apparent good news, with a fall in the annual inflation rate from 20.2 percent to 18.5 percent. However, the headline also notes, "Jobless Rate Soars", rising to 11.3 percent from 10.2 percent over the summer.

And here's the stinger of the piece: "Economists fear that President Mahmoud Ahmadinejad's subsidy reform plan, which aims to gradually cut energy and food subsidies, will hike up inflation. The Iranian parliament has approved the outline of the bill, but lawmakers are still at odds over the details of the plan."

Our initial reading of the push for subsidy cuts, with the impulse being the worsening budget situation of the Iran Government, was too narrow. There are good structural reasons to reform the system, though I am uncertain how much these factor into Ahmadinejad's calculations. Far more significant --- and provocative --- is the President's political scheme, taking some of the money saved from the cuts and distributing it to Iran's poorest people.

0620 GMT: Our starting point today will be a close eye on the next steps of two key figures, Hashemi Rafsanjani and Mehdi Karroubi.

Rafsanjani surfaced yesterday to publish a letter via Iranian Labor News Agency, denying "false news" of a letter that he and Ayatollah Mohammad Reza Mahdavi-Kani supposedly sent to Mir Hossein Mousavi on 28 September. We think this is a reference to the claimed "National Unity Plan", "revealed" by Fars News that day. At this point, however, Rafsanjani's step is a defensive move, fending off pressure from the Government and media who oppose him, rather than a major political step. We have an analysis and English translation of the letter in a separate entry.

The situation around Mehdi Karroubi is more dramatic. The Government threat to prosecute him, issued yesterday by two high-level officials, is a clear response --- showing nervousness as well as supposed strength --- to the resurgence of Karroubi's public statements, especially his Saturday meeting with Mir Hossein Mousavi.

So, to be blunt, we're wondering, "Does Karroubi back down?", and we're thinking, "No." His response to the Government's ham-fisted warning, which following similar threats over the last two months --- may not come today, but I would look for a clear signal from the cleric by the weekend.

Meanwhile, a brief article in Peiknet has stoked the fire of rumours about the poor state of the Supreme Leader's health. The website claims that three doctors were summoned urgently to Ayatollah Khamenei's house and, after examining him, insisted that he cancel all public and Government meetings and stay at home, with only his family seeing him. To our knowledge, no other source has corroborated the Peiknet assertion.

Rumors that the Supreme Leader has cancer, specifically prostate cancer, have persisted for years --- our readers have discussed these in comments. For now, we'll keep watch, especially to see if Khamenei stays out of public view.