Iran and Turkey Join Syria Peace Envoy in Truce Call

Iran and Turkey Join Syria Peace Envoy in Truce Call

NYT's Anne Barnard and Rick Gladstone report on UN envoy Lakhdar Brahimi's attempt to secure a cease-fire between the government and rebels in Syria:

Both Turkey and Iran publicly endorsed Mr. Brahimi’s effort on Wednesday. Those endorsements were significant because Iran is the most influential regional supporter of Mr. Assad’s, while Turkey supports Mr. Assad’s armed adversaries, is host to more than 100,000 Syrian refugees and has repeatedly called on Mr. Assad to resign.

In the past few weeks Turkey also has banned Syrian aircraft, moved armed forces close to its 550-mile border with Syria and engaged Syrian gunners in sporadic cross-border shelling, raising fears that the conflict in Syria could turn into a regional war.

President Mahmoud Ahmadinejad of Iran, who met this week with Prime Minister Recep Tayyip Erdogan of Turkey at a regional summit meeting in Baku, Azerbaijan, was quoted by Iran’s state-run news media on Wednesday as saying he supported the Syria truce proposal and “any group that derives power through war and means to continue war has no future.”

Sounds like the Egyptian initiative to engage Iran on Syria is fast becoming a Turkish initiative. 

Update — Also, this from the Turkish paper Zaman:

Turkish Prime Minister Recep Tayyip Erdoğan said on Tuesday he had suggested to Iranian President Mahmoud Ahmadinejad three-way talks including Egypt on the Syria crisis, given the apparent Saudi objection to Iranian involvement in a current quartet.

So who's doing the leading here? Not sure Cairo would have so easily dismissed a Saudi role.

The Iranian rial and the price of Saudi chicken

Any connection here? 

The Iranian Regime Is In Trouble - World Report

The devaluation of Iran's currency, the rial, by as much as 40 percent in the last few days has made it very difficult for the average Iranian to afford everyday food stuffs. It is no surprise that protests have broken out in Tehran's central bazaar and its surrounding streets. The bazaar is a critical pillar of support for the Iranian regime. The loss of confidence among Iran's merchant and business classes could shake the foundations of the Islamic Republic.

Chicken price rises lead Saudis to tweet - FT.com

Saudi Arabians are forgoing one of their favourite foods as a Twitter campaign against high poultry prices spreads.

The “Let it Rot” campaign urges Saudis to refrain from eating chicken to punish traders who they say have raised prices by about 40 per cent in the past two weeks.

Saudi Arabia is a leading supplier of chicken, a staple in the country, to neighbouring countries and an export ban imposed this week in an effort to defuse the anger is likely to trigger regional shortages.

One would think not if Saudi chicken are domestically produced. Still, there's much schadenfreude about the troubles of the Iranian economy (which appear not to target regime officials, as "smart sanction" advocates argued, but ordinary people in the hope that this will put pressure on the government — something that led to a disaster in Iraq) and much less about Saudi Arabia's.  

Here's an argument that the rial's devaluation is not as serious as might appear, because the government itself is the main foreign currency earner. The conclusion:

Does all this mean that Iran’s economy is on the verge of collapse, as Israel’s Finance Minster reportedly said?  The answer is no, because most of the economy is shielded from this exchange rate, though not from the ill effects of the sanctions, which will continue to bite for a while. Would it cause sufficient economic pain that would push the Iranian government to make concessions in its nuclear standoff with the West?  The answer is not likely.  The multiple exchange rate system, as inefficient as it is, will protect the people below the median income, to whom the Ahmadinejad government is most responsive.

Update: Paul Mutter has a round-up of the issue of the Iranian rial at PBS' TehranBureau

The delisting of the MEK

Years of hard work by the MEK, their lobbyists, parts of the Israel lobby (esp. when it overlaps with the anti-Iran lobby and the neocons) have finally borne fruit. A rather strange, cultish organization that once bombed Iran's parliament is no longer on the US list of designated terrorist organizations. It comes at the time of the most concerted effort to put pressure on the Iranian republican regime since its creation, and with much talk of war as background chatter.

There's an aspect of the delisting of the MEK that may have some merit: the refugee issue, i.e. where resident of Camp Ashraf might end up because they're no longer welcome in Iraq (as they were under Saddam Hussein, and ironically aren't under the Iran-leaning Iraqi government that the US overthrow of Saddam made possible.) But it shouldn't overshadow the many other reasons the MEK — a fundamentalist guerrilla movement, essentially — will now make a handy recipient of US (and other) funding should things continue to heat up with Iran. Or indeed the story of how this was possible: perhaps not so much because geostrategic calculations as intense lobbying and a lot of money.

Selected links: 

  • On US decision to delist MEK | The Back Channel
  • MEK decision: multimillion-dollar campaign led to removal from terror list | World news | guardian.co.uk
  • US takes Iranian MEK group off terror list - FT.com
  • Iranian Group M.E.K. Wins Removal From U.S. Terrorist List - NYTimes.com
  • By Delisting the MEK, the Obama Administration is Taking the Moral and Strategic Bankruptcy of America’s Iran Policy to a New Low « The Race for Iran
  • MEI Editor's Blog: The MEK is Delisted
  •  

    Iran to Egypt: "You complete me"

    Iran to Egypt: "You complete me"

    From Al-Monitor's Iran Pulse:

    Khabar Online, close to Parliamentary Speaker Ali Larijani reports Egyptian President Mohammed Morsi’s comments in his meeting with Foreign Minister Salehi that “no problem exists between Iran and Egypt”. During their meeting in Cairo Salehi expressed the “warm greetings” of President Ahmadienajd, and thanked Morsi for his attendance of the Non-Aligned Movement summit in Tehran. Salehi also congratulated the president on the “victory of the revolution of the Egyptian people”. According to the report, Morsi reciprocated and asked the Iranian Foreign Minister to offer his “warm greetings” to the Supreme Leader and President Ahmadinejad.

    Salehi also expressed Iran’s readiness for cooperation with the Egyptian government on the development of Egypt’s industrial infrastructure, adding that the two countries “complement one another”.

    Friedman: Shame on Egypt's president

    Friedman: Shame on Egypt's president

    Thomas Friedman writes (in the NYT, of course, although link above is a free access syndication):

    I find it very disturbing that one of the first trips by Egypt's newly elected president, Mohammed Morsi, will be to attend the Nonaligned Movement's summit meeting in Tehran this week. Excuse me, President Morsi, but there is only one reason the Iranian regime wants to hold the meeting in Tehran and have heads of state like you attend, and that is to signal to Iran's people that the world approves of their country's clerical leadership and therefore they should never, ever, ever again think about launching a democracy movement — the exact same kind of democracy movement that brought you, Mr. Morsi, to power in Egypt.

    I was not aware Morsi made a ringing endorsement of the Iranian system of government while in Tehran. Does this attitude mean that Friedman believes heads of states who call themselves democrats should not visit autocracies? I don't remember him making a fuss, say, when President Obama visited Cairo in 2009 when some of Morsi's friends were in prison. Or when Obama visited China. Or Russia. Or Saudi Arabia.

    Also, why is he singling out Morsi out of all the NAM leaders? Why not the representatives of the other 118 countries attending? This wouldn't have anything to do with Israel and the nuclear weapons program issue, would it?

    Update: A good reaction on Twitter:

    Iran Said to Send Troops to Bolster Syria

    Iran Said to Send Troops to Bolster Syria

    Not just the FSA's foreign fighters in Syria, according to the Wall Street Journal report from Farnaz Fassihi in Beirut:

    A commander of the Iranian Revolutionary Guard Corps, or IRGC, appeared to offer Iran's first open acknowledgment of its military involvement in Syria.

    Reuters Syrian Speaker Mohammed Jihad al-Laham, left, and Alaeddin Boroujerdi of the Iran parliament's national security committee Saturday in Damascus.

    "Today we are involved in fighting every aspect of a war, a military one in Syria and a cultural one as well," Gen. Salar Abnoush, commander of IRGC's Saheb al-Amr unit, told volunteer trainees in a speech Monday. The comments, reported by the Daneshjoo news agency, which is run by regime-aligned students, couldn't be independently verified. Top Iranian officials had previously said the country isn't involved in the conflict.

    I am slightly amazed that the WSJ has these sources:

    Iranian Supreme Leader Ayatollah Ali Khamenei, who has the final word in all state matters, has appointed Qasim Solaimani, the commander of the elite Quds Forces, to spearhead military cooperation with Mr. Assad and his forces, according to an IRGC member in Tehran with knowledge about deployments to Syria.

    The Quds Forces are the IRGC's operatives outside Iran, responsible for training proxy militants and exporting the revolution's ideology. The U.S. blames the Quds Forces for terrorist attacks in Afghanistan and Iraq.

    "Solaimani has convinced Mr. Khamenei that Iran's borders extend beyond geographic frontiers, and fighting for Syria is an integral part of keeping the Shiite Crescent intact," said the IRGC member in Tehran. The so-called Crescent, which came together after Saddam Hussein's fall, includes Shiites from Iran, Iraq, Lebanon and Syria.

    Iran is now sending hundreds of rank-and-file members of the IRGC and the basij—a plainclothes volunteer militia answering to the guards—to Damascus, said two people in the IRGC familiar with the movements.

    Many of the Iranian troops hail from IRGC units outside Tehran, these people say, particularly from Iran's Azerbaijan and Kurdistan regions where they have experience dealing with ethnic separatist movements. They are replacing low-ranking Syrian soldiers who have defected to the Syrian opposition, these people said, and mainly assume non-fighting roles such as guarding weapons caches and helping to run military bases.

    Iran is also deploying IRGC commanders to guide Syrian forces in battle strategy and Quds commanders to help with military intelligence, Mr. Sazegara and the current IRGC members said.

    Sadjapour on sex and the Iranians

    With all the commotion about Mona El-Tahawy's "Why do they hate us?" article, many might have overlooked some of the other fare in FP's sex issue — such as this hilarious piece by Karim Sadjapour on sex in the Islamic Republic of Iran:

    In his 1961 religious treatise A Clarification of Questions(Towzih al-Masael), Khomeini issued detailed pronouncements on issues ranging from sodomy ("If a man sodomizes the son, brother, or father of his wife after their marriage, the marriage remains valid") to bestiality ("If a person has intercourse with a cow, a sheep, or a camel, their urine and dung become impure and drinking their milk will be unlawful"). As a young boy growing up in the American Midwest, I remember being both horrified and bewildered after coming across these precise passages in a translated volume of Khomeini's sayings I found in our Persian émigré home. 

    [Thanks, AS]

    The childishness of Gulf geopolitics

    The visit of Iranian President Mahmoud Ahmedinejad to the island of Abu Musa has caused quite a stir among the GCC states. Iran occupies the island (and other nearby ones) but the UAE says they were acquired by Iran illegally and belong to the Emirates. 

    The picture on the right shows a Google Earth screengrab of football pitch built near an airport on Abu Musa. I guess the Iranians decided to send a message about the Gulf being theirs. One only wonders why they had to do so in English rather than, say, Farsi or Arabic.

    [Thanks, PM]

    Israel vs. Iran: the lolcats wars

    The cat pictures are the newest permutations of a social media campaign started over the weekend by two Israeli graphics designers that is called “We Love Iranians,” aimed at raising public awareness against the steady march to war the Likud government has been taking Israel on towards Iran.

    The meme has “gone viral” in Israel, and while it’s spawned a number of sensible parodies (such as noting that the same tone was on display for Iraqis to hear - if they could hear over the ack-ack - by George W. Bush in 2003) and is inevitably going to lead to a “slacktivism” discussion, at least it’s demonstrating that public opinion against war with Iran in Israel is growing. Israel is ostensibly a democracy, so the best case outcome is that all those national security specialists and “cultural icons” who have been keeping quiet realize there is a base of domestic support for them to tell Bibi to can the Holocaust references.

    More comforting, though, has been news that 1) Mossad once again concludes with the U.S’s intelligence services that Iran has neither the capability nor political will to pursue weaponization now, 2) some Iranian leaders are saying they’re willing to make concessions at the new P5+1 roundtable, and 3) Netanyahu has failed to convince his kitchen cabinet that he knows what he is talking about on Iran, and considering some of the people in that cabinet, that is saying something — not least because one of the skeptics is in fact the Intelligence and Atomic Energy Minister, a post Netanyahu’s Likud party established in 2009 to have a kind of go-to-guy looking over Shin Bet and Mossad, a la Dick Cheney.

    Still, no one is out of the woods yet, Mossad assessment and grinning Israeli couples’ pinterest tags aside. Netanyahu has deliberately set the bar for Iranian concessions so high it’s difficult to believe progress can be made in talks1 - i.e., asking the Iranians to do things no other NPT signatory is expected to do when Israel itself isn’t even an NPT signatory - and the U.S. has made it pretty clear it will take military action if it feels “compelled” to do so in the region by either an Israeli or Iranian “action.”


    1. Worse, he is now trying to play the 2005 Gaza withdrawal card against what passes as the Israeli political left over Iran - clearly, he wants to shut their tepid criticism down by any means at his disposal.  ↩

    Sanctions on Iran banking get much tighter

    Swift, a Banking Network, Agrees to Expel Iranian Banks - NYTimes.com:

    It is the first time that Swift, a consortium based in Belgium and subject to European Union laws, has taken such a drastic step, which severs a crucial conduit for Iran to electronically repatriate billions of dollars’ worth of earnings from the sale of oil and other exports.

    Advocates of sanctions against Iran welcomed the action by Swift, which takes effect on Saturday, according to a statement on the network’s Web site. The statement said that Swift had been “instructed to discontinue its communications services to Iranian financial institutions that are subject to European sanctions.”

    Lázaro Campos, Swift’s chief executive, said in the statement that “disconnecting banks is an extraordinary and unprecedented step for Swift. It is a direct result of international and multilateral action to intensify financial sanctions against Iran.”

    After the closure of a major bank doing business with Iranians in Dubai, the financial sanction noose is tightening... This is a major step, which will make all sorts of transactions (not just oil related ones) very difficult.

    Will Fox News fire Tucker Carlson for calling for genocide?

    No, I doubt it will. But this video is a good occasion to revisit the whole Ahmedenijad "wipe Israel off the map" debacle (i.e. that he did not say that, although he may have meant it), reflect on the fact that thus far it is Israel and the United States where talk of a strike on Iran is routine, as well as the sorry state of television discourse in the United States. In France, for instance, Carlson would be almost certainly sued and perhaps could even face prison. In the US this will probably be defended under the First Amendment (which I actually prefer), but many respectable news organizations have fired contributors for much less. Too bad Fox News probably doesn't fit that description.

    Update: HM sends me via Twitter a link to an exchange of emails between Carlson and Gleen Greenwald of Salon on this. Carlson says he was actually talking about the dangers of a strike on Iran to the US economy. Watch for yourselves, seems pretty unambiguous.

    Israel is bad for the US, part 2342345

    Mark Perry in Foreign Policy:

    Buried deep in the archives of America's intelligence services are a series of memos, written during the last years of President George W. Bush's administration, that describe how Israeli Mossad officers recruited operatives belonging to the terrorist group Jundallah by passing themselves off as American agents. According to two U.S. intelligence officials, the Israelis, flush with American dollars and toting U.S. passports, posed as CIA officers in recruiting Jundallah operatives -- what is commonly referred to as a "false flag" operation.

    The memos, as described by the sources, one of whom has read them and another who is intimately familiar with the case, investigated and debunked reports from 2007 and 2008 accusing the CIA, at the direction of the White House, of covertly supporting Jundallah -- a Pakistan-based Sunni extremist organization. Jundallah, according to the U.S. government and published reports, is responsible for assassinating Iranian government officials and killing Iranian women and children.

    . . .

    "The report sparked White House concerns that Israel's program was putting Americans at risk," the intelligence officer told me. "There's no question that the U.S. has cooperated with Israel in intelligence-gathering operations against the Iranians, but this was different. No matter what anyone thinks, we're not in the business of assassinating Iranian officials or killing Iranian civilians."

    Wonder if that's still true. Juan Cole has more commentary reminding us that is part of a bigger pattern:

    Israeli right wing governments have often been perfidious “allies.” Their political agent in the United States, the American Israel Public Affairs Committee (AIPAC), has assiduously spied on America, garnering military, technological and trade secrets. The spying is so normal that when AIPAC fired the longtime head of its Mideast bureau, Steven Rosen, was caught passing classified Pentagon documents to the Israeli embassy, he sued AIPAC on the grounds that he was only acting as AIPAC operatives routinely did, given the long history of domestic espionage conducted by that organization.

    Likewise, the assassination by Mossad operatives in Dubai of alleged Hamas figure Mahmoud al-Mabhouh involved massive identity theft by Israeli agents of names, passports and other information of nationals from countries considered friendly to Israel such as Australia and the UK. 1) Identity theft is wrong. 2) Stealing another person’s identity to commit murder is wrong, both because murder is a crime and because the consequences of the murder would then fall on an innocent. 3) Israel was clearly attempting to deflect a) international blame and b) any Hamas retaliation onto the innocent citizens of countries that supported Israel. That’s about as sleazy as you can get.

    Links on the Iran war drumbeat

    There is an avalanche of articles suggesting the possibility of war with Iran, either because the sanctions that the Obama administration (and perhaps the European Union) seek to impose will be perceived in Tehran as an act of war, for which the retaliation could be the closing of the Straits of Hormuz, or because of an attempt to destroy or set back Iran's alleged nuclear weapons program by either Israel or the US or both. The call for sanctions — overwhelmingly approved by Congress despite the hardline nature of the sanctions — comes as the P5+1 were about to resume negotiations with Iran over the nuclear issue, and only a month before Iran is set to have elections. Here's a few links — the best one being the first by Gary Sick:

    More on Dennis Ross

    The praise keeps coming in!

    Rashid Khalidi, in a piece really worth reading entirely:

    Dennis Ross has finally left the building. Since the Carter administration, Ross has played a crucial role in crafting Middle East policies that have prolonged and exacerbated the more than six-decade conflict between Israelis and Palestinians. His efforts contributed significantly to the growth in the number of Israeli settlers in the occupied Palestinian territories from well under 200,000 in the 1980s to nearly 600,000 today. It is in no small measure due to him that the two-state solution is all but dead.

    Ross’s tenure during the administrations of five presidents over parts of five decades was marked by a litany of failures. And yet he went from success to bureaucratic success in Washington. His ability to flourish despite these failures reflects the degree to which obsequious support for Israel has become the norm in American politics, even when it contradicts U.S. national interests.

    Read More

    The Economist says US should give Middle East a nuclear umbrella against Iran

    I could not disagree further with this (the bold bit):

    If Iran does not halt its nuclear programme, its rulers should expect their country to be treated as an international pariah. That means not just pushing for more serious sanctions, but also stepping up the covert campaign to disrupt Iran’s nuclear facilities. It also means preparing for the day when Iran deploys nuclear weapons. To that end, America must demonstrate to its allies who feel threatened by Iran—not just Israel, but Turkey, Egypt, Saudi Arabia and the Gulf states too—that its commitment to extending nuclear deterrence to them is as firm as it was to Europe at the height of the cold war. America must also be willing to make available to its allies advanced ballistic missile defences.

    Iran must be made to understand that owning nuclear weapons is a curse for it rather than a blessing. And Israel must be persuaded that striking Iran would be far more dangerous than living with its nuclear ambitions.

    Overall this leader strikes the right tone, although it inverses the seriousness of the crimes: a nuclear Iran would be a breach of the NPT, but a strike on Iran is an act of war that strikes at the very foundation of the international legal system. In any case, the suggestion that the US should extend a Cold War style nuclear umbrella over the Middle East is pure folly, the exact opposite of the disengagement from the region by the US that is now necessary. Iran's nuclear program does not represent a threat in itself (few think Iran would use the bomb) but rather an increase of Iran's regional prestige and influence. It is also a reaction to a long threat of regime change against it (and the case of Libya must not be giving it confidence that giving up nuclear weapons is the right choice.)

    This idea of a US nuclear umbrella, though, strikes me as deeply flawed. Who is going to pay for this nuclear umbrella? What risks will it expose the US to? What kind of overstretch will it be getting into? What does it mean in terms of the number of ships, submarines, bases, aircraft, etc. affected to the region? There were dozens of US bases across Europe providing a nuclear umbrella there. Do we really need more in the Middle East?

    On the IAEA's report on Iran

    So the IAEA has a new report on Iran that reveals a lot of dodgy stuff by Tehran between 1997 and 2003 and says it's quite possible work continued after 2003. At the same time we've been seeing Israeli agitation, conveniently timed to just before the report, about a pre-emptive strike. There's a lot of heat generated about this report, and it's also an occasion to revisit less-discussed aspect of this crisis: assassinations of Iranian nuclear scientists (surely equally condemnable as any Iranian assassination attempts against Saudi ambassadors?), Stuxnet, Iranian deterrence options, how Iranian allies in Iraq and elsewhere might react to a crisis, etc.

    I don't have anything particular to add to this debate, as my views are pretty fixed on this. Iran should respect the NPT, and me made to do so through diplomatic means. A regional grand bargain is necessary that involves the nuclear disarmament of Israel and the Middle East free of WMDs many major regional actors have advocated. Any infringement of Iranian sovereignty — missile strikes, invasion, assassinations — is unaceptable. We should also think of the consequences of the Libya war — whether it might make some "rogue states" reconsider giving up their nuclear arsenal considering what happened to Qadhafi.

    Below are some links to various pieces on the issue.  

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    In Translation: Fahmi Howeidy on Iran, Syria and Bahrain

    We bring you another commentary piece from the Arab media in translation, courtesy of Industry Arabic, a  full-service translation company founded by two longtime Arabist readers, which specializes in English-Arabic-French technical, legal, and engineering translation management services.

    Fahmi HoweidyThis week I selected an article by Fahmi Howeidy, a conservative Egyptian columnist who is widely believed to be the most influential pundit in the Arab world. Howeidy is well-connected and writes for multiple audiences (he is syndicated in Egyptian papers and several Gulf-owned ones). He has long championed a kind of elitist Islamo-populism which I personally abhor, but does have some resonance in the region. At his best, Howeidy is (was?) incredibly cutting of (some of) the regimes in place; at his worst he defends silly conspiracy theories and makes crude, unsupported attacks against his ideological enemies — including at times rather nasty personal attacks.

    In recent years, Howeidy had been a defender of Iran in its standoff with Israel and the United States. As the author of several books about Iran with excellent access in Tehran, he consistently defended the Islamic Republic and its foreign policy. Even when the Hizbullah and the Iranian Republican Guards were said (plausibly) by the Mubarak regime to have operated an espionage network with links to Hamas in Gaza, Howeidy slammed the Egyptian regime. This shocked many at the time, since after all covert operations had been uncovered and public opinion tended to be critical of any foreign meddling. In other words, there was a time when, for Howeidy, Iran could do no wrong.

    In the column below, Howeidy reports from a conference in Tehran and slams the Iranian stance on Syria, going as far as arguing that the Islamic Republic “has lost its moral compass.” He comes out strongly against the Assad regime and makes a compelling argument that what he had admired about Assad — his commitment to the “Resistance Front” against Israel and the United States’ imperial policies in the last decade — cannot take precedence over the regimes’ murdering of its own population, and that it further risks souring that population on supporting the Resistance Front. I recommend reading alongside Rami Khouri’s latest column, on the fall of Iran’s star in the Arab world this year. Howeidy’s take may be the surest sign of this trend. Finally, his equivocating on Bahrain in the latter part of the piece is also interesting — Howeidy is not quite ready to abandon the Bahraini royals, and their Gulf allies…

    Read More

    Egypt, Iran, and the Islambulis

    The news that Egypt has arrested the brother of Sadat's assassin as he arrived at Cairo Airport is interesting:

    Mohamed Shawqi el-Islambuli, brother of Khalid el-Islambuli who killed former President Anwar al-Sadat in 1981, was sentenced to death in absentia in 1992 for plotting from abroad to overthrow the state.

    He was sentenced again in 1999 in a landmark trial of more than 100 suspected members of the Gama'a al-Islamiya movement blamed for a massacre of tourists in the southern city of Luxor, an embassy bombing in Pakistan and a series of killings and assassination attempts including one against Sadat's successor Hosni Mubarak.

    [. . .]

    Islambuli returned after Iran's government told him he must leave the country and could travel either to Egypt or Pakistan. After failed attempts to enter Pakistan and Turkey, he boarded a plane to return to Egypt, said [his lawyer Nizar] Ghorab.

    Aside from geopolitical differences, the biggest obstacle to the resumption of diplomatic relations between Egypt and Iran has been that Tehran has hosted Islambuli and named a street after his brother. The question here is why did Iran decide to kick out Islambuli, and why was he left no choice but to return to Egypt where his arrest was certain? Could this be a prelude to the resumption of diplomatic ties (which would be perfectly normal, Egypt is one of very few countries — Israel, the US — which do not have diplomatic relations with Iran)? And does Iran feel compelled to do something it failed to do for years not just because Mubarak is gone, but rather because the regional setup is changing so quickly, with Syria falling apart, Hamas perhaps on its way to deserting Damascus and Tehran and Hizbullah post-Assad perhaps being more Lebanon-centered?

    Iran, a model for Egypt?

    Don't get me wrong: Iran is absolutely not a model for Egypt in terms of its bizarre, unelected Ayatollah-led Islamic republic, or in terms of its nasty and repressive security apparatus. But it might be in terms of economic policy, if the IMF is anything to go by. Here's a statement from the latest IMF Article IV consultation for Iran, the annual "inspection" of economic policy and performance review it does in every country:

    “The mission reviewed recent economic developments and revised its macroeconomic estimates and projections in light of new data and discussions with the authorities. Real GDP growth recovered to an estimated 3.5 percent in 2009/10 despite the drop in oil prices, reflecting strong non-oil growth and an exceptional agriculture crop. The positive growth momentum continued in 2010/11. The authorities’ monetary policy successfully brought down annual average inflation from 25.4 percent in 2008/09 to 12.4 percent in 2010/11. Gross external reserves also remain comfortable with improved prospects for the external sector on the back of higher oil prices.

    The mission commended the authorities for the early success in the implementation of their ambitious subsidy reform program. The increases in prices of energy products, public transport, wheat, and bread adopted on December 19, 2010, are estimated to have removed close to US$60 billion (about 15 percent of GDP) in annual implicit subsidies to products. At the same time, the redistribution of the revenues arising from the price increases to households as cash transfers has been effective in reducing inequalities, improving living standards, and supporting domestic demand in the economy. The energy price increases are already leading to a decline in excessive domestic energy consumption and related energy waste. While the subsidy reform is expected to result in a transitory slowdown in economic growth and temporary increase in the inflation rate, it should considerably improve Iran’s medium term outlook by rationalizing domestic energy use, increasing export revenues, strengthening overall competitiveness, and bringing economic activity in Iran closer to its full potential.

    Cutting energy subsidies and rationalizing other subsidies so that they target the poor better is exactly what Egypt needs to be doing. Mohamed ElBaradei is the first Egyptian politician who had the courage to bring it up, to my knowledge, in last night's appearance on the Amr Khaled "Boukra Ahla" show. Rather than borrowing money from financial institutions to finance increases in its budget, Egypt should cut the subsidies. It will be politically unpopular but it's necessary.

    The previous government knew it and the next one better know it. An economic policy that delivers better social justice and poverty reduction doesn't just have to create jobs, improve infrastructure and deliver better social welfare — it also has to finance itself without systematically resorting to debt and to be efficient and fair in the way it delivers subsidies. The businessman who lives in a villa in Maadi and drives a gas-guzzling Range Rover should not be getting subsidized fuel — better to spend that money on the poor villagers who need affordable cooking gas. So perhaps there is something to learn from Iran after all.