Iran’s president on multiple crises: ‘We are on the edge of the abyss’

“We can no longer deliver water to the people,” Iranian President Masoud Pezeshkian announced recently. “In every field, we are on the edge of the abyss. We have water problems, electricity problems, gas problems, money problems, inflation problems – where don’t we have problems?”

Pezehkian’s July 23 confession continued: “There is no longer any choice; everything is a matter of compulsion. I cannot avoid cutting the water, because I have no other option.”

In Iran, each crisis enumerated by the nation’s president carries the potential to erupt into a social explosion. Indeed, public anger over livelihood issues, water shortages and electricity blackouts is flaring up.

Media outlets close to the radical Islamic government write: “Prolonged, unplanned power cuts have disrupted citizens’ lives. For example, in Tabriz, the situation has reached a point where people have been driven to the edge.” (Shahr-e Bourse – July 23)

Another report stated: “While people are struggling with lengthy outages, government offices, banks and state organizations continue their consumption without restrictions. This blatant discrimination has doubled the anger of citizens.” (Shams Azerbaijan – 23 July)

Alarming economic statistics

Alongside these warnings, economic figures paint a clear picture of worsening conditions in Iran. According to a Baharnews report of Aug. 7, the nation’s GDP has fallen from over $600 billion last year to around $400 billion, and is still on course to drop to $300 billion. Such a trajectory signals widespread recession, shrinking investment, destruction of productive infrastructure and overall collapse of public trust in the country’s economic future.

In such circumstances, governments typically try to manage crises through structural reforms or social support measures. But in Iran, what is happening instead is the continuation of repression and the closing of public space.

Sociological warnings and the politics of repression

In its Aug. 7 edition, Arman-e Emrooz daily, both in its news reports and an analytical piece by sociologist Emanollah Qaraei-Moghaddam, described the economy’s critical state. Qaraei-Moghaddam warned that “the ever-worsening situation could lead to widespread youth uprisings.”

This is not idle sociological analysis, but an accurate reflection of an ever-present reality that pulses through Iranian society: “The younger generation sees no bright horizon ahead, no hope for improvement through official channels.”

For this reason, the Iranian regime has turned to executing individuals arrested on charges of being members of resistance units, in hopes of preventing the rising support for these groups.

According to the regime-linked Fararu website (Aug. 6): “For the first time in fifty years, Iran’s economy has entered an era of infrastructure erosion,” and “mega-challenges such as water, electricity, gas, pension funds, dust storms, land subsidence and gasoline imbalance are just the tip of the iceberg.”

This state-run outlet presents “institutional and structural reforms” as the only way out – reforms that would mean limiting the dominance of institutions tied to the Supreme Leader and the powerful Islamic Revolutionary Guards Corps (IRGC) over the economy and other spheres of life.

2 different pathways for structural change

Since the recent 12-day war with Israel, Iranian society has entered a phase that could be called the regime’s moment of reckoning. Two main currents, each with a different vision for structural change in governance, have emerged:

Well-known political and civil figures – large segments of the regime’s own base, including some clerics – have repeatedly stressed the need for transformation in the current political structure. They know well that without fundamental change, the radical theocratic regime is doomed to fall.

Thousands of resistance units across the country have emerged, mostly affiliated with the main opposition People’s Mojahedin Organization of Iran (PMOI/MEK), and form the backbone of organized resistance against the regime. They believe all branches of power – military, police, executive, judiciary and legislative – are concentrated in the Supreme Leader’s hands, with his one and only uncrossable “red line” being his own personal survival. For that, he has no qualms about committing mass killings, as has happened repeatedly in Iran’s recent history.

War or negotiation

The Iranian regime faces multiple domestic and international challenges:

Internationally, it must abandon uranium enrichment and permanently part ways with proxy forces that were once its strategic assets.

Domestically, it must gradually reduce the IRGC’s dominance over the economy and politics and decrease the role of security forces in people’s daily lives.

The problem is, internationally, abandoning current policies, whether completely or gradually, would be extremely costly for the regime. Over $2 trillion invested over decades in an ambitious and extremely costly nuclear program would be lost. Such a retreat would be akin to suicide for the regime. But if it refuses to retreat, it will be forced to accept war, even though, in Pezeshkian’s own words, it lacks the capacity to wage one.

Domestically, even to preserve parts of the current structure, the regime would have to move, however slowly, toward more freedom. But could even these step-by-step retreats eventually tear open the suffocating net of repression that engulfs all of Iran?

The return of Ali Larijani

The return of Ali Larijani, once disqualified from the presidential race, as the powerful secretary of the Supreme National Security Council – the highest decision-making body in Iran (perhaps even above the government) – does not necessarily signal the regime’s inclination toward moderation or policy change.

Nevertheless, some might interpret the designation as Khamenei’s first step toward gradually moving to a full halt in uranium enrichment internationally. Domestically, it might be an attempt to bring back segments of the establishment that have distanced themselves and demanded structural reforms, by giving them a larger share, and thus securing his survival against the hard-core IRGC and security forces.

But Larijani’s reinstatement might merely be a tactic to buy time in negotiations. The Supreme Leader is aware that without economic relief, the eruption of popular anger – like an unstoppable volcano – is on the way. His room to maneuver is now extremely limited, especially with the massive resistance gaining ground.