Weakness and Struggles

 The massive protests taking place in Iran right now—which the ruling regime has characteristically met with death and repression—are generally understood to have been sparked most immediately by rampant inflation. The Iranian rial has reportedly lost more than half its value in the last six months, and food prices in the country have spiked by more than 60%. 

One can attribute this economic collapse—with some justice—to the economic mismanagement of the regime. And indeed, the Iranian president didn't do himself any favors when he effectively threw up his hands the other week and announced that he was basically out of ideas for how to address the country's many economic problems. 

But as bad and authoritarian and antisemitic and incompetent as the Iranian leadership plainly is—we also can't absolve the Western sanctions regime for culpability in this. 

Inflation, after all, is generally understood to be the product of too much money chasing too few goods. This is why, if countries massively increase the supply of cash available as a form of fiscal stimulus—as the United States did in response to the pandemic—it can cause prices to rise. Too much money chasing too few goods. 

But inflation can also result from the other direction—too few goods. And one thing sanctions very obviously do is to choke off the supply of goods to a country. However much money was sitting around the country suddenly becomes superfluous. Its value starts to plummet. Too much money chasing too few goods again—but for the opposite reason. 

This is essentially what happened in the early experience of Soviet Russia. 

When the Bolsheviks took power after the 1917 October Revolution—they quickly found themselves introducing measures like forced requisitions from the peasants and forced labor from the proletariat that seemed like a pretty obvious betrayal of their ostensible principles. Which they were. 

These measures were a lasting moral stain on a regime that would only get worse and more repressive from there. But they were also in part the foreseeable result of Western sanctions. 

In this prescient 1920 book, The Practice and Theory of Bolshevism, Bertrand Russell was harshly critical of the authoritarianism and fanaticism of the new Soviet leaders. But he also did not spare the Western sanctions regime for its role in setting the conditions for this repression. 

When the Western blockade of the new Soviet economy went into effect, following the revolution, it predictably led to a plunge in the value of the currency. How? Again, because it choked off the supply of imported goods. Hence, the new regime found itself with too much money chasing too few goods. The Bolshevik currency instantly lost much of its purchasing power. 

As Russell explains, this hyper-inflated paper currency then made it almost impossible to buy food from the Russian peasantry. They were loath to part with actual eggs and milk and meat, in exchange for useless paper that had lost almost all its value. 

This created pressure for an exodus away from the cities to the countryside. It became almost impossible to feed urban workers. And this in turn made it increasingly difficult to sustain the Bolshevik war effort. 

And so, the regime—to its lasting disgrace—started resorting to forced requisitions—theft, in essence, at gunpoint—from the peasantry in order to feed the urban workforce. 

Since these requisitions were still generally inadequate, however, workers still often wanted to flee to the countryside, where food was still relatively abundant. And so, Russell explains, the government introduced compulsory labor in the cities, in turn, along with harsh punitive measures against those accused of "labor desertion." 

The Soviet regime proceeded from there down a long spiral of growing authoritarianism and repression. This occurred for reasons partially having to do—as Russell also points out—with its own dictatorial and fanatical ideology. But part of the blame surely belongs to the Western "blockade" as well.

It's hard not to see the parallels to what's happening in Iran today. Once again, we have a ruling regime with a fanatical ideology that lent itself from the beginning to authoritarianism. Western sanctions didn't make the Iranian regime what it is—its own fundamentalist theocratic belief system did most of that work. 

And yet, the Western sanctions have inevitably made the situation even worse—with the resulting pain, as always, falling almost exclusively on the county's civilian population, who have done nothing wrong. 

Sanctions create a situation of artificial scarcity, which then triggers hyperinflation. This prompts protests at the cost of living; which motivates the government in turn to respond with even more repression and violence. And these symptoms are then taken to be reasons why we cannot possibly ease the sanctions—because look how brutal and awful the regime is!

"If a man is deprived of food and drink, he will grow weak, lose his reason, and finally die," as Russell wrote of the Western blockade. "This is not usually considered a good reason for inflicting death by starvation. But where nations are concerned, the weakness and struggles are regarded as morally culpable, and are held to justify further punishment."

And so we have the vicious circle we are witnessing in Iran today. The regime may indeed become even more despotic and paranoid than it is already. And thus, the idea of easing sanctions will seem even more unpalatable. 

A regime that throws up its hands and frankly confesses that it cannot solve the country's economic problems is certainly showing a lot of "weakness and struggles"—and the West appears likely only to meet this, perversely, with "further punishment." 

The regime itself deserves the lion's share of the blame for the situation, to be sure. But the U.S. government cannot absolve itself of setting up a dynamic in which all of the incentives for a corrupt regime point to it becoming even more repressive.