1. Despite Iran’s history of mass movements and widespread anger, the #WomanLifeFreedom protests remained small and sporadic and have now subsided.
In @ForeignAffairs, I explain that ordinary Iranians need economic resources to exercise their political power.
The West can help.
2. The protests triggered by the death of Mahsa Amini felt different from the outset. They were led by women and political in their aims. They generated solidarity across class and regional lines. It seemed like the protests could snowball, despite the state’s violent response.
3. But that didn’t happen.
The first stumbling block was the failure to organise strikes among the working class. Labor activists tried for months to get local and national strikes off the ground with little success. Something was holding workers back.
4. The middle class, likewise, didn’t engage at the scale seen in previous movements with an overt political focus, such as the 2009 Green Movement. Protests had a sporadic, even spontaneous quality. We didn’t see the kinds of mass mobilisations that truly put pressure on elites.
5. As I write in the essay, acknowledging the limited scale of the protests does not discredit the efforts of organizers and activists in Iran. On the contrary, anyone who cares about fundamental political change in the country *needs to understand* why the protests faltered.
6. There is a robust debate about what makes social movements succeed. It takes a lot of things. But among the most important conditions is the availability of resources—time, money, effort.
People need to be in a position to devote these things to the movement.
7. This is where Western sanctions policy matters. Iran is a poorer country than a decade ago, owing to sanctions. Household consumption has declined 20% since 2010. The poverty rate as risen 10 pp. Iranians are undeniably in the most economically precarious position in decades.
8. In recent meetings with US and European officials, I’ve asked an uncomfortable set of questions. Do they assess that the sanctions have reduced the political power of ordinary Iranians? Has the capacity for mobilization among citizens diminished.
9. The answers were concerning in two respects.
First, there doesn’t appear to be any systematic effort to assess such outcomes right now.
Second, everyone I spoke to agreed that it was plausible that sanctions could have had this effect.
10. Let’s be clear. The sanctions are going to remain in place. Iran is engaging in repression at home, selling drones to Russia, and continuing nuclear escalation. I am not calling for any substantive sanctions relief. Policymakers will obviously keep applying sanctions for now.
11. For this reason, activists, especially those in the diaspora, are wasting energy simply calling for more sanctions.
To account for the connections between economic means and political might, we need to move away from the mindset of maximising pressure and think critically.
12. In the essay, I offer three concrete ideas to help restore political power to ordinary Iranians by reducing their economic precarity *while* Iran remains under broad sanctions. Pressure will remain, but it can be calibrated so that citizens can stand up to the elite.
13. First, the West needs to create channels to allow remittances to flow into Iran, shoring up the consumption of households so that individuals can devote time and money to the protest movement. This would help make strikes more feasible, as workers could forgo wages.
14. Second, the West should create exemptions in the sanctions to allow companies and individuals abroad to hire freelancers in Iran. This would empower young, urban Iranians who are chronically underemployed, giving them breathing room to think about their political demands.
15. Third, we need to make is easier for middle class Iranians to take their money out of the country to escape the corrosive effects of inflation. This will deflate asset bubbles that emerge because sanctions act like capital controls. Those bubbles burnish the wealth of elites.
16. Taken together, these measures amount to a framework for what I call calibrated pressure. Some money flows into Iran, some flows out. But the flows, in their scale and composition, are designed to support citizens in ways that restore their power vis-a-vis elites.
17. When it comes to using economic coercion to seek behavior change or to advance political aims, preserving the economic power of the people is *as important* as seeking to constrain the economic power of the elite.
18. To secure the future that Iran’s protesters envisioned in their slogan of #WomanLifeFreedom, Iranians must first secure their livelihoods.
1. China is now a more important partner than the US for Saudi Arabia's development. Chinese exports of metals, machinery, and transport equipment have crowded out US exports. Once Saudis start using Chinese cars (and planes?), there will be little market share left for the US.
2. The flip side of this is that China imports significant quantities of Saudi oil. The US no longer does.
But given the new composition of Saudi trade, when there is an output cut, the higher oil price will hurt the US more than China.
3. As @michaelxpettis explains, the higher oil revenues, if invested in projects like NEOM, can boost Saudi demand for capital goods.
It seems the Saudi-China economic partnership has the potential to be much deeper than the historic Saudi-US partnership.
1. Why do broad economic sanctions hurt citizens more than elites in the target country?
Adapting from @rodrikdani, you can create a model to explain why this happens.
2. To think about sanctions we need to think about the impacts of economic shocks on the power of elites and citizens.
Sanctions are an exogenous shock that shift the economic possibilities frontier (EE) to the left, due to a drop in investment and reduced access to technology.
3. But, the actual output of the targeted country isn't shown by EE. Different inefficiencies + distortions related to the political economy of the country mean that the output available for distribution to elites + citizens will fall on a political transformation frontier (PP).
1. This is a postcard of the Compagnie Internationale des Wagons-Lits and Thomas Cook and Son travel agency in Tehran, Iran.
CIWL ran a line from Baghdad to Tehran off its Taurus Express service, which launched in 1930 with routes from Istanbul to Cairo and Basra.
2. CIWL customers could board the Simplon Orient Express in London and arrive in Cairo after 7 days or in Baghdad after 8 days following a transfer to the Taurus Express in Istanbul.
3. Passengers arriving in Istanbul would take a boat across to the Asian side of the Bosporus, disembarking at the Haydarpaşa Station, where they would then board the Taurus Express and continue their journey.
1. Discussions around de-risking, sanctions, and US dollar hegemony tend to focus on the use of the dollar as the key factor that turns banks into "chokepoints" (cc @henryfarrell + @ANewman_forward). But bank behaviours are only partly influenced by the transaction currency...
2. The whole point of secondary sanctions is that banks comply even when there is no nexus to the US dollar. It is conceivable to have a world in which the "petrodollar" wanes in importance but in which the vast majority of banks remain chokepoints that the US can weaponise.
3. Part of this stems from the continued size and importance of the US market, access to which requires use of the US dollar. But there are many other factors at play, which are institutional and cultural rather than just structural.
1. Compelling argument from @RanaForoohar that the US and Europe should respond to the "rise of the petroyuan" by "moving away from fossil fuels."
But geopolitically speaking isn't that impulse precisely why key states want to de-dollarize? ft.com/content/d34dfd…
2. The short term rise of shale oil production and the medium term push for the green transition explain why the US and Europe can now sanction countries with less political/economic blowback than before. This has made it more likely that sanctions will be used by policymakers.
3. In turn, sanctions targets (Russia, Iran) and countries that believe they are potential targets (China, Saudi Arabia) are spurred to develop sanctions proof trade channels. They need to take the "dollar" out of "petrodollar" in part because we are taking out the "petro."
1. On Iran, the critical question is why a protest movement motivated by such righteous anger has not generated large and durable traditional protests—so far.
What changes in political, economic, and social factors since 2009 are preventing mobilisations like those in the past?
2. Protests are not the only way for people to make demands of the state, but they are a really important mode of political action. We have generally taken for granted the idea that Iranians enjoy capacities for large protests given their recurrence in recent years.
3. Much of the discussion on how to “support” the protestors has been focused on validation of their *aims* (think Macron being encouraged to call the movement a revolution). But what we ought to focus on is the *means*. Do Iranians have the means to seek accountability?