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    Middle East
     Aug 7, 2007
Page 1 of 2
Ahmadinejad stages a bureaucratic revolution
By Kaveh L Afrasiabi

Making good on his campaign promise to introduce "revolutionary changes" in the government's management of economic, social and foreign affairs, Iranian President Mahmud Ahmadinejad has introduced serious measures that have yet to be fully implemented but which will in all likelihood define his era.

Although he has been in office since October 2005, Ahmadinejad has now hinted at a "new diplomatic phase at a different level" within the next four months, promising that a "new movement" in



Iran's diplomacy is about to start that will make a significant improvement in the country's external affairs.

Boasting that Iran has "a very active" foreign diplomacy, Ahmadinejad has not publicly elaborated on the details of his bold new vision or whether it will entail any organizational restructuring in addition to a "new approach".

Concerning the latter, Ahmadinejad's supporters, writing on the website Rajanews.ir, have provided a couple of clues. One, Iran is seeking to make ethics the centerpiece of foreign policy, whereby ethical norms and considerations will serve as guiding principles in line with the Islamic constitution that, for instance, makes it incumbent on the government to express solidarity with liberation movements and to pursue Islamic unity.

Connected to this is a theoretical endeavor to broaden the notion of "national interest" by telescoping it to the broader interests of the Muslim world. There is, after all, a complex relationship between a specifically national or Iranian set of interests and the larger pan-Islamist interests that defies simplistic generalizations.

But while we await the main contours of the president's restructuring of Iran's diplomacy, and how this might impact on relations with the United States and the international community over Tehran's nuclear program, the other bureaucratic ramparts of Ahmadinejad's "revolution" - particularly with respect to economic macro-management - are already in full swing.

Indeed, Ahmadinejad has fully embraced the word "revolution" in describing his planned revamping of the economic decision-making process in Iran by his bold decision to dissolve the Planning Bureau and to merge it with the Center for Strategic Studies, an arm of the executive branch.

"The Planning Bureau has a 60-year history, and no one is happy with it. All the criticisms are directed at this regime of planning," Ahmadinejad stated in a recent press conference, adding that Iran needs an "Islamic and Iranian" model of planning and cannot solve its economic problems by following "formulas" founded by others. Within the next few months, the government is supposed to unveil its new model - undoubtedly a litmus test of Ahmadinejad's presidency, whose promise of "economic justice" and "economic growth" were key to his elections victory in 2005.

A change in economic planning
In 1999, this author published an article, "Iran unveils its proposed third five-year plan", which included the following: "The five-year plan - of the few areas in Iran with unbroken continuity from the pre-revolutionary [1979] regime - is arguably a relic of the past, ill-suited to the dynamic process of the Iranian economy's globalization and privatization."

Eight years later, Ahmadinejad appears to have reached the same conclusion. The government will undoubtedly continue to make medium- and long-term economic plans, but the era of five-year plans, which the Islamic Republic inherited from the ancien regime without making any major institutional alterations until a few weeks ago, is now closing. At the same time, this casts a cloud over the country's hitherto triangular economic decision-making, based on short- (one to two years), medium- (five years) and long- (20 years) term planning. Many Iranian economists doubt that the relatively "light" Center for Strategic Studies can handle the overload of "heavy" economic decision-making burdens now fallen on its shoulders.

Nor is it clear that the career technocrats and bureaucrats of the Planning Bureau will work well with what until now has been a relatively minor research arm of the presidency. The chances are that Ahmadinejad's bold new move will take place within an inadequate organizational framework, causing a reversal.

Thus the death knell for the Planning Bureau may have been sounded prematurely, given the obsession for economic forecasting and the sedimented habit of planning in Iran. Too many variables operate with regard to the "revolution" in economic management, so the jury is still out.

A balance sheet of five-year economic planning is desperately needed to assess objectively the contributions and numerous deficiencies of this model of economic macro-management superimposed on the Iranian economy for so many decades.

Various economists, including Padma Desai and Manmohan Agarwal, agree that "the idea of five-year plans and their designs and implementation owe much to the Soviet experience". In the book Problems of the Planned Economy, edited by John Ealwell et al, the structural tensions between the logic of statist control of the economy, which recycles centralized decision-making, and that of (capitalistic) private economy, which favors decentralization, are highlighted.

Central planning reifies the private sector, and it has been noted by Sovietologist Alec Nove that in the Soviet and Eastern European experience, "various forms of indicative planning, reinforced by the state's own investment plans [eg infrastructure], became an important contribution to guiding private investment decisions".

Indeed, the inadequate pace and scope of privatization in Iran's state-dominated economy has a lot to do with the current dissatisfactions with the "planning fetish" rampant in the government's bureaucracy. The Third Five Year Plan's aim to "shrink the size of government" has not materialized, and its initiative of a new organization to promote privatization has yielded few results.

In fact, most of the problems with the plan were aptly predicted by Parliament's research center, which faulted its incoherent industrial, agricultural and commercial policy, its "lenient" tax 

Continued 1 2 


Iran feels the chill in US cold war tactics (Aug 3, '07)

Washington's befuddling line on Iran (Jul 27, '07)


1. China's primal scream

2. SCO is primed and ready to fire

3. Abbas staring at oblivion   

4. Maliki is out on his feet

5. Iraq bleeds US, enriches contractors

6. Iran feels the chill of cold war  

7. US has a lose-lose dilemma in Iraq

8. Nothing is scarier than the China scare

( Aug 3-5, 2007)

 
 



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