Following the 1979 revolution in Iran, the profound influence of religion on the revolution’s outcome and the subsequent establishment of a theocratic state captured the attention of scholars, commentators, and practitioners observing Iranian state and society. In recent years, Iran has remained a focal point of international attention due to its controversial nuclear programme, imposition of international sanctions, heavy involvement in regional affairs, and significant popular uprisings, especially the ‘Life, Women, Freedom’ revolt. However, the majority of analyses and commentaries on these issues have seldom transcended exceptionalism and culturalism. This is because they often imply a perception of Iran as entirely detached from the broader social, political, and economic transformations occurring in global capitalism.
In my recently published book, Capitalism in Contemporary Iran: Capital accumulation, State Formation, and Geopolitics, by Manchester University Press in the Progress in Political Economy (PPE) Series, I offer an alternative narrative grounded in a historical materialist perspective. Drawing on the social ontology of the philosophy of internal relations, the book argues for the importance of tracing the changes in the patterns of capital accumulation and the resulting shifts in class and state formation in Iran within the development of the wider capitalist world market during the neoliberal era to overcome the pervasive methodological nationalism and exceptionalising frameworks. Conceptually and methodologically, the book thus makes two central claims. It asserts that there are inner connections between Iran’s contemporary development, state structure, ongoing sociopolitical transformations, and geopolitical tensions with the West. Simultaneously, it highlights the need to analyse these issues in the context of their internal relations to the motions and tendencies of global capitalism and resulting geopolitics. By doing so, it aims not only to address the challenges of global/local or external/internal dualism but also to navigate beyond the dichotomies of market/state, material/ideational, and economy/security.
After setting out the conceptual framework of the book – defining totality, internationalisation of capital, and neoliberalism, and exploring the repercussions of neoliberalism on state and class formation while elucidating the connections between neoliberalism, imperialism, and geopolitics – the book kicks off with two historical background chapters that narrate the development and transformations of capitalism in Iran from the late nineteenth-century to the onset of neoliberal restructuring in 1989. It highlights that the Shah’s modernisation project, which culminated with the wide-ranging land reform and the rapid industrialisation programme based on an Import Substitution Industrialisation (ISI) strategy, was part of the shakeup of global capitalism under US hegemony. This restructuring engendered a new, small, protected capitalist class closely connected to foreign capital that exercised control over the entire state apparatus. Although the 1979 revolution toppled the Shah’s regime, it did not dismantle the socioeconomic foundation of society. State-led development under the ISI framework even expanded between 1979 and 1989, albeit amid US hostility and under the guise of the national liberation of the ‘downtrodden’. This political revolution, nevertheless, brought about a new ruling class with two fractions in the first decade of the revolution: the stratum of government managers and the bonyad–bazaar nexus.
The remaining chapters of the book seek to recast contemporary Iran by examining the reconfiguration of social classes, shifts in ideological and institutional organisation of the state, significant political upheavals, and the country’s position in the global order following the initiation of neoliberal reforms after the end of the war with Iraq in 1989. Framing it as part of the response to the global crisis of the 1980s, I argue that the process has produced a hybrid form of neoliberalism that reshaped the ruling class. During the first phase of neoliberalisation (1989–2005) the stratum of government managers transformed into the internationally oriented capital fraction, advocating export-oriented industrialisation and integration into Global Value Chains of Western capital, particularly European capital. During the second phase of neoliberalisation (2005–2013), the ownership of many large government-owned enterprises was transferred to the revolutionary foundations (bonyads), resulting in the emergence of the military–bonyad complex from the bonyad–bazaar nexus, with a hostile stance toward the entry of Western capital and a preference for Chinese investment in Iran. By criticising the existing accounts of the Iranian state based on contingent factors such as religion, resource endowment, patronage networks, and leadership styles, I show that these changes in the class basis of the state during the neoliberal era, in turn, have given rise to new institutions and altered the functioning of existing ones. Additionally, the conflicts between the two new fractions of capital have led to the construction of the new discourse of ‘democratic Islam’ and the rearticulation of ‘revolutionary Islam’.
Equally, the process of neoliberalisation has reshaped the subaltern classes by engendering the precariat as the largest section of the working class and the new poor consisting of unemployed educated young people. The book also demonstrates that workers have been resisting privatisation, casualisation, redundancies and overdue pay since the early 1990s through various means, including the establishment of independent labour unions and networks for the first time since the 1979 revolution. In relation to the post-2017 waves of popular uprisings, known as the Dey and Aban protests, it is argued that the new poor played a significant role in these spontaneous nationwide protests in response to the worsening economic crisis caused by the combination of the government’s aggressive neoliberal policies and crippling US sanctions. While these structural factors have been integral to the development of the Women, Life, Freedom revolt in 2022, the findings illuminate that this new wave of rebellion has been more successful in mobilising a diverse range of societal groups compared to the previous uprisings.
Finally, in contrast to the existing accounts of the Iranian nuclear programme, international sanctions and regional policy, the book underscores the interconnectedness of these issues with the processes of neoliberalism in Iran, the Middle East, and globally. In this part of the book, I put forth two key arguments. First, the changes in the geoeconomic and geopolitical policies of the United States, the European Union, China and Russia in the Middle East in the two different periods of neoliberal global capitalism (1990–2007 and 2008–present) are essential for grasping the Iranian nuclear programme, related international sanctions and Iran’s recent interventions in the region. Second, the different fractions of the Iranian ruling class have been active actors regarding these issues to achieve their long-term interests. While the internationally oriented capital fraction has been bargaining with the West for economic integration into the global political economy through pursuing conciliatory policies regarding the nuclear programme and the Middle East, the military–bonyad complex has utilised the nuclear programme, interrelated international sanctions and Iran’s influence in the Middle East to hinder the permeation of Western capital, halt further integration of Iran into the Western-centred world order and push Iran into the orbit of China and Russia.
To sum up, the book emphasises the importance of placing Iran within the transformations of global capitalism to understand it, all while recognising the gravity of local dynamics and internal factors. Only employing a similar approach allows us to outline potential factors that could shape the future paths of the Islamic Republic amidst the global crisis of neoliberalism, the changing global order, and the intensification of struggles from below.
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