Iranians Want U.S. to Help Them Pursue Happiness

At Mahdi Vosochi’s garage in the heart of Tehran, festooned with pictures of American and European sports cars, the men in greasy overalls have more on their minds than engines and transmissions.

These days, the talk often turns to politics--and whether President Mohammad Khatami will prevail in his struggle against conservatives and succeed in bringing more freedom to their country.

Against the backdrop of a slow minuet between Iran and the United States over resuming cultural ties, many people are also counting on Khatami’s achieving improved economic relations with the West--including the U.S.

“We need their technology. We need to have a relationship based on justice and mutual interest. It’s good for them, and it’s good for us,” said Vosochi, 50, whose attachment to U.S. know-how shows in the loving care he lavishes on his car: a baby-blue Camaro he bought before the 1979 Islamic Revolution.

Mechanic Mohammed Ramazani, a 26-year-old who is engaged to be married, agreed that it is important for Iran to be open to America and for Iranians to have more freedom generally.

“What’s wrong with that? I am for having relations with everyone, as long as it’s fair,” he said. Before, “we didn’t have a relationship [with the U.S.] based on mutual respect. But we should not decide our future based on past bad experiences.”

He said that young people, including him, ought to be given “a chance to do what they want to do--to work, to live and be happy, and not be afraid of anyone or any eyes watching them all the time.”

Ties With West Bring Popularity

On one hand, Khatami’s willingness to seek economic ties with the West is an important element of his overwhelming popularity in a country facing an economic decline and hoping for a higher standard of living. On the other, there is a fear that the West, and particularly the United States, is not responding quickly enough with concrete steps of its own.

According to the president’s supporters, one key way that U.S. policymakers could help would be to drop objections to making Iran the main pipeline route for the fast-developing oil and gas resources of the Caspian Sea.

“It would be a very positive gesture. Iran’s main concern about the United States is that the U.S. does not care at all about Iran’s interests,” said Iranian oil industry watcher Bijan Khajehpour.

“That would catch the attention of people here,” agreed political scientist Hadi Semati, who added that “Iran would be in a very difficult position” if it did not reciprocate.

In an address to the nation last month marking his first anniversary in office, Khatami unveiled a broad economic program calling for better conditions for foreign investors, increased privatization and a reduction in red tape. He didn’t, however, go into detail on how he would attain these goals.

The long-awaited speech followed attacks on Khatami by conservative newspapers that said the president has been moving quickly on expanding political freedoms at the expense of attending to festering economic problems. Khatami has been under increasing fire from the conservatives--enduring the corruption prosecution of his top political ally, Tehran Mayor Gholamhossein Karbaschi, and the ouster of a key Cabinet member by the hard-line parliament.

The conservative criticism does not appear to have caught on with the general public, more than 70% of whom still enthusiastically support Khatami, according to opinion polls. But there is no denying that the Iranian economy is sick and needs help.

The country is suffering from stagflation--with annual growth estimated at only 1% while inflation is estimated at 25%. Falling oil prices this year have hurt the government budget drastically, and the state is struggling to maintain heavy subsidies on fuel, food and other goods as part of the Islamic system of “social justice.”

Youth unemployment is particularly acute in this country of 67 million people, more than half of whom are younger than 20. In the first years of the Islamic Revolution two decades ago, Iranians were encouraged to have large families, creating a baby boom. Now, up to 1 million of these Iranian boomers will be reaching working age each year--and the economy at most can create 500,000 jobs annually.

Political Change to Bolster Business

All this is frightening for the authorities and is forcing the political changes, in the opinion of one analyst.

“The regime has realized the economic and demographic pressures that exist, and they realize the only way to deal with the pressures without collapsing is to open up,” said Khajehpour, the oil industry analyst.

In other words, political change is needed so that foreign investors will have the confidence to come into the country and private businesses can flourish in a less restrictive environment.

It is hard to imagine why the economy should be in such poor shape, because Iran possesses the world’s second-largest natural-gas reserves and fourth-largest oil reserves. But economists tend to blame an entrenched merchant culture that has resisted innovation and industrialization. Aside from pistachios, carpets and caviar, Iran has almost no non-oil exports.

Ali Rashidi, an independent economist, said that an unholy alliance between the bazaaris--Iran’s traditional merchant oligopoly--and religious leaders led to the removal of competent managers after the revolution. These same entrenched forces now are keeping Khatami off balance with political attacks.

“In my view, the situation is becoming very, very critical, and if it is not checked or solved, the normal outcome will be a political or social crisis--which of course the right-wingers will be waiting for and welcoming,” Rashidi said.

He pointed out that Iran is not simply losing out on trade with the United States. Poor relations with Washington are also preventing it from having normal relations with institutions such as the International Monetary Fund and the World Bank and are keeping it from obtaining needed technology--for instance, to modernize its commercial air fleet of aging Boeings.

A host of Iranian experts see U.S. participation in Iran’s oil-and-gas sector as key to assuring the world that Iran is open for business for the first time since the revolution. And the Caspian oil pipeline is an important symbol of that. Of all the Caspian pipeline routes proposed so far, Iranian officials say, the shortest, cheapest and safest is the one through Iran to the Persian Gulf.

Last year, Washington decided to oppose using Iranian outlets for Caspian oil. By lifting such objections now, the United States would be supporting Khatami and the reformist camp in Iran’s still-undecided power struggle, analysts say.

Oil-Rush Mentality Grips the Region

Such a move would also be the first tangible sign that the United States is really interested in renewing relations, the analysts say. “Don’t give Khatami the talk that he’s a nice guy. Give him something--the beef is in the pipeline,” said Hooshang Amirahmadi, the Iranian-born director of Middle Eastern studies at Rutgers University.

Since the fall of the Soviet Union and the emergence of three new Caspian Sea states eager for petrodollars--Azerbaijan, Kazakhstan and Turkmenistan, in addition to Russia and Iran--an oil-rush mentality has gripped the region. All these countries are moving rapidly to exploit potential reserves estimated at between 50 billion and 200 billion barrels.

But the pipeline for delivering that oil to world markets remains a thorny issue. Washington, still bent on isolating Iran internationally, so far has backed an alternative pipeline--a longer, more expensive route--that avoids Iran.

Iranians argue that if the pipeline went through their country, the oil wouldn’t even have to make the trip, at least at the start. It could be consumed in northern Iran, and then Iranian oil from fields to the south, along the Persian Gulf, could be swapped for it and shipped east to Asia or west to Europe.

Iran’s internal pipeline network already covers most of the distance, so only short links between the Caspian oil fields and Iran would have to be built from scratch.

Iranian officials believe that U.S. interests would benefit if the cheaper pipeline route was chosen, and benefit even more if Washington allowed U.S. companies to take part in foreign investment that Iran is inviting into its oil-and-gas sector.

“Any impediment [to] the constructive role that Iran is trying to play, and is entitled to play, is harmful to Iran and to any other country, including the United States,” argued Hussein Kazempour Ardebili, a senior advisor in both the petroleum and foreign ministries in Iran.

“The economics and feasibility of using Iranian territory for the routes is very clear and in favor of Iran, compared to any alternative route,” he said. “This is not only our judgment--it is the conclusion of the studies by most of the international companies.”