In answering the motivating question of this roundtable—How, if at all, has capitalism as an analytical category figured in your work?—I separate my approach from two opposed but equally extreme camps of left-leaning scholars working on postrevolutionary Iran. The first camp underestimates the actuality of capitalism in Iran.Footnote 1 It takes as its frame of reference neoliberal capitalism in the context of the Global North and contrasts it to an Iranian political economy lacking both the hallmarks of political liberalism and a robust economy to extrapolate that postrevolutionary Iran is not truly capitalist, without explaining why classic capitalistic class relations are continuously reproduced there. By contrast, the second camp overestimates the reality of capitalism in Iran, claiming that all aspects of collective social and political life are, in fact, now essentially capitalistic.Footnote 2 This perspective rejects the relative autonomy of the state, culture, and other aspects of social life and the necessity for historical explanation of social and political complexities. Instead, it considers postrevolutionary Iran a purely capitalistic formation and explains its economy and politics through the logic of capital alone, without acknowledging the real weaknesses of capitalist production found there.
To avoid these prevalent analytical traps, we need to take into account both the potency of capitalist class relations and the impotence of capitalist production in postrevolutionary Iran. I deploy capitalism as an analytical category in my work in a way that captures both characteristics simultaneously.Footnote 3
Over the past decade, I have gradually constructed an explanatory framework for analyzing the conditions of possibility for capital accumulation in the postrevolutionary Iranian economy. Considering the accumulation of capital as a process rather than the act of transforming surplus value into capital, I have tried to map six interconnected structural conditions that make capital accumulation possible. I isolate and highlight these six conditions among the others that exist because they function as either structural bottlenecks in the economy, or they constitute major domains of potential crises—social, political, environmental, and economic.
The first link in this capital accumulation chain (hereafter CAC) is related to the actual making of the key agents of capital accumulation. This process requires a series of coercive expropriations that have led to the concentration of significant economic resources in the hands of a well-connected minority active in the private, public, or semipublic sectors. These processes of appropriation by dispossession have been political, rather than economic. That is, they have not always been geared toward value production, at least initially. Nevertheless, they have had significant redistributive effects by transferring resources from the politically powerless public to a politically connected and powerful minority. In the postrevolutionary era this ongoing appropriation by dispossession has deprived popular classes of access to the means of production and subsistence. It has significantly reduced common and collective rights by amassing them in the hands of the new dominant classes, contributing to the formation of both new capitalist as well as economically and politically dominated popular classes since the revolution.
Parallel to this double class formation caused mostly by appropriation through dispossession, we have had a second link of the CAC in postrevolutionary Iran in which employers in the private, public, and semipublic sectors have deployed a range of strategies to make a heterogeneous labor force sufficiently obedient to submit to increasingly harsh and exploitative working conditions. These ongoing interventions in labor markets have been orchestrated by employers and their allies in the political establishment to secure an uninterrupted supply of cheap and submissive workers. This erosion of the individual and collective bargaining position of workers drastically accelerated beginning in the 1990s, the era of post Iran–Iraq War reconstruction and structural adjustment policies.
The third link in the CAC came about after the 1979 revolution, as various common and public environmental resources were commodified and made available as cheap stock to be treated as a common factor of production. Ordinary people participated as accessories in this commodification of nature, accelerating the process of reducing the environment to a mere economic resource available for extraction and exploitation. After the revolution, the imposition of legal private property rights by the state over geographical spaces that were considered communal, collective, public, and common mediated this process, and eventually contributed significantly to widening class power relations between those who had succeeded in gaining property rights over environmental resources and those who had not. This differentiated domination of environmental resources across Iran's geobody has manifested itself in relations of class power among the citizenry, based on changes made to the property rights regime.
These three links of the CAC in postrevolutionary Iran have been deployed in a way that gives the upper classes an unchallenged material advantage. This has been justified by the claim that the ensuing economic gains will eventually trickle down to the rest of the public. The paradox of capitalist accumulation in postrevolutionary Iran is that despite the relatively successful imposition of these vertical class relations, the horizontal intraclass power relations within the upper social classes have remained too fraught and dysfunctional to make it successful. To explain this continued dysfunction, we must now examine the remaining three links of the CAC in postrevolutionary Iran.
The fourth link is based on the contentious process of value production within workplaces. There have been two contradictory tendencies at work here: On the one hand, employers in various sectors of the economy (public, private, and semipublic) have taken full advantage of their superior power to employ cheap labor and privatized environmental resources in productive economic activities. On the other, since the rates of profit and return on investment are much higher in the domestic speculative and nonproductive sectors, the productive sectors have been at a significant disadvantage in comparison to speculative and unproductive activities.
The operations of commodities markets and value realization within them constitute the fifth link of the CAC in postrevolutionary Iran. Effective domestic demand mediated by the interests of commercial capital has privileged the import of foreign commodities at the expense of domestically produced goods. However, non-oil exports have been unable to compete and capture a meaningful share in international commodity markets. This has created serious interruptions in the value realization process of domestic production in the postrevolutionary era.
The sphere of capital reinvestment is the sixth link of the CAC in postrevolutionary Iran. Here is where decisions shaping the future geography and logistics of surplus value accumulation are made. Because of the structural tendencies toward divestment of capital over its reinvestment, the rate of capital accumulation has been too low to jump-start an ongoing cycle of capitalist growth and development.
In sum, seen through the analytical lens of the CAC, the political economy of postrevolutionary Iran can be studied as interactions between these six moments: nonexploitative economic oppression, the exploitation of labor, the privatization and commodification of nature, value production in workplaces, national and international commodity markets’ effective demand for commodities produced in the domestic economy, and the transformation of surplus value made in the domestic economy into capital.
The first three moments can be captured by dealing with vertical power relations as the arena in which class relations in capitalism are formed, and the latter three by focusing on horizontal, intraclass power relations within the ruling class as the place where the dynamics of capitalist production are deformed in postrevolutionary Iran.
Based on this conceptual framework, I proceed with two assumptions: First, under any form of capitalism it is vertical power relations within and between differentiated upper and lower classes that create the conditions for the accumulation of capital, mainly by paving the way for the increasing commodification of labor power and the physical environment (natural resources). Second, as outlined earlier, the historical configurations of capitalism in postrevolutionary Iran indicate that the conditions of capital accumulation have been so poorly met that they effectively hinder capitalistic production. Given this history of class power configurations, capitalism in postrevolutionary Iran is characterized by two traits: ever-strengthening capitalist class relations are, paradoxically, accompanied by ever-weakening capitalist production.
How can a political economy operate while being continuously threatened by two contradictory characteristics that act like the blades of open scissors? And how can an economy with ever-weakening capitalist production be well-incorporated into global capitalism? The answer to both questions can be provided by considering the critical role played by oil and gas export revenues. Until recently, the economy of postrevolutionary Iran was able to sputter along mainly thanks to a cushion of hydrocarbon export revenues. The state has historically relied on hydrocarbon revenues to prevent chronic structural crises from becoming socially and politically unmanageable. These revenues enter the treasury where they are mixed with other public sector incomes, before being disbursed according to the formal budget and other state priorities, some of which may be political. Therefore, hydrocarbon revenues enter the national economy as payment for labor and work performed, the obligatory contribution to the national sovereign wealth fund, payment for the purchase of goods and services, and through investment and contributions to financial and capital markets. But state spending also flows through nonmarket channels. These include subsidies of all kinds, including to households and nongovernmental economic producers, grants and aid to selected recipients, domestic and international, and corruption. The flow of revenue lubricates the economy and partially compensates for the deficient and ever-weakening capitalist production in the other economic sectors. The disbursement of hydrocarbon revenues abroad also mediates the incorporation of the Iranian economy into global capitalism. Here, the peculiarities of the postrevolutionary Iranian economy stand out. There has always been a significant imbalance between the meager value of Iran's non-oil exports and the value of all that it imports, leading to a chronic negative non-oil current account balance. Second, international sanctions and persistent political discord have led to capital flight and divestment, as reflected in the negative capital account balance.
In conclusion, the postrevolutionary Iranian economy suffers, to paraphrase Marx, not only from the development of capitalist class relations, but also from the weakness of capitalist production. Whereas the appropriation of surplus value through dispossession and exploitation continues via ever-strengthening capitalist class relations within the domestic economy, its accumulation, based on a high degree of capital flight because of ever-weakening capitalist production, mostly takes place through the global economy.
