In February 2007, Islamic Republic of Iran will be twenty-eight years old. Yet, the regime is still negotiating among its different factions, and with different social interest groups on defining the character of the political regime and the social order that it seeks to establish. In Class and Labor in Iran: Did the Revolution Matter? (Syracuse University Press, 2006) we argue that Iran has not succeeded in overcoming its post-revolutionary crisis. A post-revolutionary crisis is the outcome of open social confrontations and persists until a new economic order is fully established. However, defining and establishing the economic order are matters of struggle among contending social forces vying to promote their interests.

 

In Class and Labor in Iran we propose a theoretical-empirical framework for understanding the dynamics of the post-revolutionary changes in Iran through a study of the changes in the class nature of the work force in our society. That is, who were we before the revolution? Who have we become in the subsequent decades? We examine the changes in the class locations, and in the social hierarchy of work of the labor force in the post-revolutionary decades in urban and rural economies, and for men and women. We recognize that this is only the skeleton of a more complex analysis of social classes. Nevertheless, a macro-theoretical quantitative analysis of the class nature of labor force is the first step in drawing a more complete picture of the complex pattern of social classes in our society. We believe that we can better understand the nature of our revolution, and its prolonged post-revolutionary crisis trough the understanding of the complexity of the evolving pattern of social classes, their subjective and organizational coordinates, and the changes in their state of existence. 

 

Much is frequently declared about the growth, existence or absence of this or that class in the Iranian society, but rarely defined clearly, or answered empirically. For example: Was/is there a large or growing middle class in the pre/post-revolutionary Iran? Do/did we have a “real” working class? How do we define class position of employees of the state? How large or how fragmented is our capitalist class? What happened to women employment in the post-revolutionary Iran? Was gender segregation any way related to the class position of women? What about the urban/rural divide, and the class-ethnicity and class-religious configurations of the working population? 

 

We recognize the existing ambiguities and controversies in the study of social classes. Far from trying to resolve these controversies, we attempt to reduce ambiguities in the meaning of the terms that we use by defining our theoretical conceptualization of classes. We operationalize our theoretical conceptualization by bringing it to the empirical sphere, relying on the various decennial censuses of population of Iran.

 

So, who were we before the 1979 Revolution?

 

In 1976, nearly one-third of Iranian employed work force were self-employed, petty bourgeois, 99 percent of whom were in a traditional occupational positions (such as farmers, textile/rug makers, carpenters, grocers, truck or taxi driver-owner). Among our capitalists, the large majority owned small enterprises, with two or three workers, and were in traditional occupational positions. About forty percent of the Iranian employed workforce was in the working class, about half of whom worked in enterprises larger than fifty workers. Middle class was tiny (five percent) and less than one-third of them worked for the private sector.

 

The 1979 revolution was a social rupture, undoubtedly, egalitarian in character, and openly antagonist toward large capital and capitalists, especially those affiliated with foreign enterprises. (“Sarmayehdar-e vabasteh nabood bayad gardad!” was one of the widely expressed slogans.) The revolution disrupted the “normal” functioning of the society. Most significantly, it jeopardized the sanctity of property rights and safety of capital, causing the weakening of capitalist relations of production, and entangling the elaborate maze of the market networks. This condition was conducive to the growth of petty-commodity production and small scale capitalist activities. We call this degenerative process “structural involution”. The Islamic state amplified the involutionary trend with its populist policies, at times even inciting anti-capitalist tendencies and encouraging small scale activities. The resulting changes in the economic structure affected the class composition of the Iranian work force.

 

By 1986, the number of the independent workers (petty bourgeoisie) had grown by more than double the rate of growth of the workforce (nearly all in traditional positions), and the working class (employed by the state and private sector) had shrunk by a quarter. The number of small capitalists almost doubled since the last census. The average number of wage earners per capitalist employer (concentration ratio) fell from 16 in 1976 to 5.3 in 1986. The first post-revolutionary decade was a set back for the bourgeoisie and capitalist relations of production. In the same period, the middle class employees in the private sector decreased to half of what it was in 1976. Obviously, the smaller, more traditional enterprises needed fewer managers and professional workers. At the same time the middle class employees of the state increased almost by ninety percent. Between 1976 and 1986 more than one million was added to the rank of government functionaries (800,000 of them to the armed forces). Women’s employment decreased not only relatively, but also absolutely. 

 

A disrupted economy with a bloated state machinery, faced with a costly war, a glut in the world oil market, a suffocating economic sanction, and a rapidly growing population, placed the Islamic state in a dire economic situation. By the late 1980s the state came to the realization that its claim for establishing the Rule of Mustazafan and its plan for erecting an Islamic economy were utopian fantasies. With the death of Ayatollah Khomeini in 1989 the time for breaking the revolutionary taboos arrived. Hashemi-

Rafsanjani entered the stage as a champion of economic liberalization, and by 1992 the liberalization policy was underway for reconstructing and rejuvenating the market and its institutions. 

 

Economic liberalization policies look attractive in abstraction from political realities. In short, they imply removing all market barriers, from foreign exchange and domestic price controls, to subsidies and quotas, letting resource scarcities determine market prices, directing resources to the more efficient users, who are the highest bidders. It is suggested that this policy will increase productivity and profitability, which could potentially increase investment and thus employment and economic welfare of all. Yet, these may take place, if all goes well (which often does not), after a period of high inflation, high unemployment, bankruptcy of many small capitalists and petty bourgeois producers, and the decline of real income of many wage earners. 

 

It did not take long before the liberalization policy of Hashemi-Rafsanjani came under popular criticism. For the first time, during the Rafsanjani presidency, the Islamic Republic found it necessary to include open political unrest as a constraint in its public policy formulation. Thus, Hashemi-Rafsanjani pursued a zig-zag policy of economic liberalization. Despite the limited advances of economic liberalization in the 1990s, continuing into the Khatami’s presidency, the involutionary trend of the Ayatollah Khomeini decade was reversed substantially. Foreign exchange rate was realigned, price controls were mostly lifted, some subsidies were reduced, and others were eliminated. Increase in oil prices in these years, allowing for continued inflow of imports, made the timid liberalization policy somewhat palatable. By 1996 (the date of the last available census) we can see the impact of this rejuvenation in the capitalist relations of production on the class nature of the employed workforce. Working class and the middle class (employed by the private sector and the state) grew, concentration ratio (wage earners per capitalist employer) increased (albeit marginally) and women gained increased access to employment opportunities. Meanwhile, the petty bourgeoisie, in urban and rural areas, suffered a relative set back, and a large segment of population found itself vulnerable to a decline in real income in the face of intermittent spells of high inflations.