Editorial 1: ​​At a crossroads

Context

Iran needs to undertake reforms and renew its engagement with the international community.

Introduction

Iran is witnessing a renewed wave of unrest triggered by a deepening economic crisis, rapid currency collapse, and rising cost of living. What began as a localized strike has expanded into nationwide protests, exposing the fragile balance between economic distress, political rigidity, and external pressure confronting the Islamic Republic at a critical moment.

Trigger and Spread of Protests

• Initial spark: A strike by shopkeepers in Tehran on December 28, protesting the sharp fall of the Iranian rial
• Escalation: The strike snowballed into nationwide protests, the largest since the 2022–23 unrest
• Historical parallel: Comparable in scale to protests after the custodial death of Mahsa Amini
• State response:
  • Assurances on addressing traders’ economic grievances
  • Warnings of harsh action against “rioters”
• Human cost: At least 12 deaths reported within a week as protests spread

Geopolitical Backdrop

• Timing matters: Unrest comes six months after Iran survived a 12-day war with Israel
• Foreign involvement claims heighten regime anxiety:
  • Mossad claimed its operatives were “in the field” with protesters (Dec 29)
  • Donald Trump warned the U.S. was “locked and loaded” if protesters were killed (Jan 2)
• Perception problem: Rulers see protests as economic dissent plus externally fuelled instability

Economic Crisis at the Core

• Inflation shock: Food inflation at 64% (October), second highest globally
• Currency collapse: Rial down ~60% since the June war
• Energy stress: Daily power outages
• Oil exports: ~7% decline in 2025 compared to 2024 average
• Official admission: President Masoud Pezeshkian said the government was “stuck” and couldn’t perform “miracles”

Key Economic Indicators

Governance Constraints and Contradictions

• Social easing: Some relaxation of morality police enforcement
• Hard limits: Economy and national security remain tightly controlled
• Repression loop:
  • Economic decline cause public anger
  • External threats cause greater repression
  • Repression cause deeper crisis

Role of External Pressure

• Washington’s approach: Economic squeeze and threats
• Domestic impact: Ordinary Iranians suffer, regime grows more paranoid
• Policy alternative: Engage and empower Pezeshkian rather than escalating threats on Israel’s behalf

Why the Old Narrative Is Failing

• Default blame: Crises attributed to foreign conspiracies
• Structural reality: Shrinking opportunities and eroded freedoms
• Societal shift: Religion and nationalism may no longer offset economic despair

What Needs to Change

• Initiate genuine reforms
• Tackle corruption
• Restore economic opportunity
• Re-engage with the world
• Acknowledge public anger as structural, not merely external

Conclusion

The protests reflect not merely foreign interference but a structural crisis rooted in economic mismanagement, shrinking freedoms, and public disenchantment. Without meaningful reforms, efforts to curb corruption, and re-engagement with the world, reliance on repression, religion, and nationalism will prove insufficient, risking recurring instability and deeper erosion of state legitimacy.