Handing over major long term infrastructural development and management to the private sector is a recipe for disaster. Private enterprises are after immediate profit maximization and quickest possible return on investment ergo have little incentive to engage in projects like these, nor maintain them properly once launched.
The UK's railway sector is a textbook example: after having been privatized at one point, it degraded to such a catastrophic state that the regime backtracked and proceeded with re-nationalization.
For Iran, continuation of state-driven infrastructural development on a grand scale in an absolute must. So far, it has yielded very good results, both in international comparison and in comparison to the pre-Revolution era. Iran's rail, road, urban transportation and other networks have grown several fold in size since the victory of the Islamic Revolution.
To say that Iran's rail network is subpar because it mostly consists of single track lines would not be an valid contention. Simply because demand on these routes is not sufficient to justify the construction of parallel twin tracks - talk of white elephants. Where traffic is intensive enough however, a second track was added (as between Tehran and Mashhad due to the abundance of pilgrims, part of the Bandar Abbas line due to cargo transit, etc).
In truth, governmental planning of the national rail network has soundly reflected actual social and economic needs, which provides ample evidence as to the fact that state-driven development isn't necessarily bound to generate unprofitable works nor wastage of resources.
State-driven infrastructural development is a proven model and the crown jewel of hybrid economy, the only viable form of economic organization especially for a country like Iran. With countless, decisive historic illustrations (New Deal, 1930's Germany and USSR, 1960's France etc, the list is just too extensive). The method not only compensates for the intrinsic deficiencies of the private sector but moreover it's a source of job creation, generous and reliable like no other.
In short, this definitely forms part of the ideal response to Iran's economic challenges in the present context, marked by massive illegal USA-imposed sanctions. A sanctions regime like the one Iran has been subjected to, calls for something along the lines of a war-time economy. Under circumstances like these, which are naturally conducive to corruption, excessive privatization policies will only result in further amplifying said corruption.
The problem has more to do with the ultra-liberal belief in an unrestrained capitalist economy, which came to infest too many minds in Iran during the reconstruction phase in the aftermath of the Sacred Defence and the accession of Hashemi Rafsanjani to the presidency (note: liberal here refers to economic policy not to social and political matters; liberal economic policy = free market advocacy).
Underlying this belief is the assumption, echoed by liberal politician and technocrat Ali Akbar Salehi in an interview with IRIB a few years ago, that their preferred economic theory amounts to unquestionable "truth" akin to findings obtained through the experimental scientific method. Whereas in reality, economy is anything but a hard science: it's a human scientific discipline where psychology, sociology, culture, anthropology and above all, politics play as much if not more of a role as mathematical calculations. Economy remains a field of contradictory debate and controversy, and if there's a truth to discern, it will not be demonstrated through experiments or calculations but through rational argumentation.
All out market-oriented economic outlook acts as an obstacle to the expansion of large state-sponsored works. This sort of thinking runs counter to the spirit of the 1979 Islamic Revolution and Imam Khomeini's (r.A.) Leadership, focused as they were on addressing the plight of the downtrodden (
mostazafin) and alleviating their hardships proactively.
Case in point, Iranian supporters of unfettered market economy won't shy away from requesting the privatization of fundamental infrastructures. If there's one sector which even those governments that practice the most market-friendly policies hesitate to privatize, it's infrastructures like these (national airliner, national mail service etc). Yet in Iran, advocates of no holds barred capitalism tend to be more Catholic than the Pope. Their inspiration in the theoretical arena stems from the likes of the Austrian and Chicago schools of economics, and in the realm of economic policy from figures such as Margaret Thatcher. Extremists whose ideology, if fully applied in Iran, would mechanically cause not just economic meltdown but popular revolt on a hitherto unseen scale.
Malcolm Dean: Society Guardian was launched in the wake of Margaret Thatcher's election. A brutal widening of inequality followed
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Maybe this is why the main ideological promoters of this doctrine, such as the Niavaran school or the Kian circle, mostly consist of individuals close to the liberal faction (reformist and moderate alike), i.e. forces suspected of acting as a fifth column for western imperialists. The catastrophic economic record of the Rohani administration, the worst of any cabinet under the Islamic Republic, is an testament to this, knowing that Rohani's team was deeply influenced and actively counseled by those same neoclassic economists.
Everything points to this not being merely a consequence of political myopia, infantile ideological obtuseness and/or accumulated
oqde (complexes) vis à vis revolutionary enthusiasm, but deliberate promotion of counter-productive economic formulas and governance practices with the express goal of provoking domestic instability and taking aim at Velayate Faqih, in line with the agenda of Iran's existential foreign enemies. The surreal manner in which the Rohani administration implemented the fuel subsidy reform, and Rohani's even more surreal reaction when publicly asked, complete with the cynical smiles which came to characterize that government, perfectly fit the picture. Not least because they directly triggered nationwide riots.
This said, the ultra-capitalist dogma gradually crept beyond its traditional categories of adherents and ended up tainting increased segments of the principlist camp, which of course compounds the issue. This is one of the reasons why the current administration of Ebrahim Raisi is yet to attain its full potential, despite its revolutionary credentials and the undeniable, immense improvement its economic program represents over that of the previous government. Two other reasons are sabotage by liberals embedded as civil servants in various state administrations and amidst other decision making and management centers; and, the influence and power of corrupt clans.
Thank God Supreme Leader Khamenei, who has regularly denounced the capitalist order (which, remember, is not simply an economic set of rules - it's a particular type of social, cultural, political and even anthropological system of its own) is here to rein in these deviant forces as best as he can, as could be seen in a rare instance of personal intervention on his part to prevent the previous government from borrowing money from the IMF. Such a move would have ruined over four decades of strict discipline in regards to shunning the short term debt dilemma, a vicious trap so many economies the world over have fallen into but which the Islamic Republic has successfully spared the Iranian nation from.
The solution, therefore, lies in a silently pre-planned, astutely coordinated and radical revolutionary move involving all three powers as well as security agencies with the support from the top, to oust once and for all every liberal ringleader and agent acting as the enemy's footmen within the system; followed by sustained re-information efforts, so as to bring about a new generation of decision makers and managers all the while of weeding out those who're sold hook, line and sinker to the dogma of unregulated capitalism. Parallel to this, corruption must be dealt with with an iron fist.
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