The return of the shah, sans jewels

Martyr-making and arrests in Iran only create more problems for Khamenei

An Iranian opposition supporter covers his face with a bloodstained hand during clashes with security forces in Tehran on 27 December 2009. Photograph: Getty Images

The wave of arrests that erupted in Iran yesterday marks the latest move by a government determined to silence growing opposition despite the spiralling political crisis in which it finds itself.

However, it seems that the arrests, along with the killing on Sunday of eight protesters, including a nephew of the Reform presidential candidate, Mir Hossein Mousavi, will instead make martyrs out of mere men. The developments are also catalysing a movement that increasingly sees the regime of the Islamic Republic's supreme leader, Ayatollah Ali Khamenei, in the light of the former, much-hated shah.

Ali Mousavi's death is especially significant, given that the violent crackdown on Sunday's protests in Tehran coincided with the Shia holiday of Ashura, a mourning event that remembers Iman Husayn, a grandson of the Prophet Muhammad martyred in the year 680. Mousavi's body has since been seized, a move that analysts in Tehran have suggested is an attempt to prevent demonstrations from forming around his funeral.

Fatemeh Haghighatjoo, a former member of Iran's parliament who is currently a visiting scholar at the University of Massachusetts, told the New York Times:

Ashura is a very symbolic day in our culture and it revives the notion that the innocent were killed by a villain.

Similarly, Juan Cole, president of the Global Americana Institute, remarked:

For the regime to create a member of the Mousavi family as martyr on Ashura was most unwise. Shiite Islam even more than traditional Catholicism thrives on the blood of martyrs.

The arrests have only served to further villianise the regime. At least seven leading opposition activists have been arrested, including the opposition politician Ebrahim Yazdi, a foreign minister after the revolution, and three aides to Mousavi, prompting bloggers to label yesterday the "Iranian Night of the Long Knives".

More critically, Ayatollah Khamenei's legitimacy, already damaged by his support for Prime Minister Ahmadinejad's re-election in June, has been hardest hit by the government's decision to repress. Although he still commands the loyalty of the Revolutionary Guard, new hatred for him has sprung up among Iranian elites and the opposition is now more unlikely than ever to back down.

Writing on his website, the Iranian film-maker Moshen Makhamalbaf was one of those who denounced Khamenei for Sunday's violence by comparing him to the the shah (translation taken from the New York Times):

I am so sorry that I fought against the shah when I was 17. He left the country when he realised that people no longer wanted him. But you are resisting until everyone else leaves the country.

Photo: Getty Images
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There are risks as well as opportunities ahead for George Osborne

The Chancellor is in a tight spot, but expect his political wiles to be on full display, says Spencer Thompson.

The most significant fiscal event of this parliament will take place in late November, when the Chancellor presents the spending review setting out his plans for funding government departments over the next four years. This week, across Whitehall and up and down the country, ministers, lobbyists, advocacy groups and town halls are busily finalising their pitches ahead of Friday’s deadline for submissions to the review

It is difficult to overstate the challenge faced by the Chancellor. Under his current spending forecast and planned protections for the NHS, schools, defence and international aid spending, other areas of government will need to be cut by 16.4 per cent in real terms between 2015/16 and 2019/20. Focusing on services spending outside of protected areas, the cumulative cut will reach 26.5 per cent. Despite this, the Chancellor nonetheless has significant room for manoeuvre.

Firstly, under plans unveiled at the budget, the government intends to expand capital investment significantly in both 2018-19 and 2019-20. Over the last parliament capital spending was cut by around a quarter, but between now and 2019-20 it will grow by almost 20 per cent. How this growth in spending should be distributed across departments and between investment projects should be at the heart of the spending review.

In a paper published on Monday, we highlighted three urgent priorities for any additional capital spending: re-balancing transport investment away from London and the greater South East towards the North of England, a £2bn per year boost in public spending on housebuilding, and £1bn of extra investment per year in energy efficiency improvements for fuel-poor households.

Secondly, despite the tough fiscal environment, the Chancellor has the scope to fund a range of areas of policy in dire need of extra resources. These include social care, where rising costs at a time of falling resources are set to generate a severe funding squeeze for local government, 16-19 education, where many 6th-form and FE colleges are at risk of great financial difficulty, and funding a guaranteed paid job for young people in long-term unemployment. Our paper suggests a range of options for how to put these and other areas of policy on a sustainable funding footing.

There is a political angle to this as well. The Conservatives are keen to be seen as a party representing all working people, as shown by the "blue-collar Conservatism" agenda. In addition, the spending review offers the Conservative party the opportunity to return to ‘Compassionate Conservatism’ as a going concern.  If they are truly serious about being seen in this light, this should be reflected in a social investment agenda pursued through the spending review that promotes employment and secures a future for public services outside the NHS and schools.

This will come at a cost, however. In our paper, we show how the Chancellor could fund our package of proposed policies without increasing the pain on other areas of government, while remaining consistent with the government’s fiscal rules that require him to reach a surplus on overall government borrowing by 2019-20. We do not agree that the Government needs to reach a surplus in that year. But given this target wont be scrapped ahead of the spending review, we suggest that he should target a slightly lower surplus in 2019/20 of £7bn, with the deficit the year before being £2bn higher. In addition, we propose several revenue-raising measures in line with recent government tax policy that together would unlock an additional £5bn of resource for government departments.

Make no mistake, this will be a tough settlement for government departments and for public services. But the Chancellor does have a range of options open as he plans the upcoming spending review. Expect his reputation as a highly political Chancellor to be on full display.

Spencer Thompson is economic analyst at IPPR