Waste, Corruption, Privilege, and Ambition in Iran

The examination of the 952 trillion tomans budget for the year 1395 began in the open session of the parliament on April 22 after months of delay. If we set aside the question of the sources of funding for this budget, the current question among the people is how this budget is spent. The record of the Islamic Republic regime over the past 38 years indicates its inefficiency in managing the country. This inefficiency is such that the cost of its ineffectiveness in certain years equals the current and developmental budget of the country. This inefficiency can be observed in the lack of sustainable, balanced, and comprehensive economic development, widespread poverty and unemployment, and the very low economic growth of the country. I will explain this claim in four areas: Waste occurs in five areas. The first area is government propaganda apparatuses. The table below, which shows only a portion of the government's advertising costs, indicates an annual expense of over 1300 billion tomans, the elimination of which would not disrupt the administration of society and the lives of people. Radio and television could be private in the country, and people could both use its programs and pay for it. The cost of religious advertising should also be paid by the faithful, not the government. To the above figures, we can add destructive activities such as censorship, sending jamming signals, filtering, enjoining good and forbidding wrong, collecting satellite dishes, Friday prayer headquarters, and similar activities that incur hundreds of billions of tomans in waste for the government and people annually. The second area is the religious bureaucracy. The exact budget figure for religious seminaries from state and government sources (the leadership apparatus) is unclear but is certainly in the range of thousands of billions of tomans. The education of 30,000 foreign seminarians and about 130,000 domestic seminarians (30,000 women and 100,000 men) cannot be managed with lower figures. The parliament annually approves thousands of billions of tomans for spending in seminaries in the form of the budget. The amount spent by the leadership apparatus in this regard is also unclear. Khamenei pays the highest tuition from public resources to gain the most support among clerics. The third area is government projects. Due to a lack of expertise and delays in implementation, a significant portion of waste occurs in this area. Plans such as the new Tehran airport, Tehran-North freeway, Tohid Tunnel, Gotvand Dam, and hundreds of large and small projects that have either not been executed properly or have taken decades to execute have left billions of dollars in damages. Tens of thousands of unfinished projects embody waste in the country. The fourth area is inflation and the unnecessary largeness of the central government. In Iran, about 40 million people live on government salaries, which means about 10 million salary earners in the public, governmental, and retired sectors. According to the Deputy of Human Capital of the Management and Human Capital Development Office of the President, "Currently, 41% of the country's households are salary and pension recipients from government agencies, which, including 2 million and 215 thousand retirees, brings this number to 10 million, meaning 50% of the country's households." The number of government administrative managers in Iran (about 150,000 at mid and lower levels) is equal to half the total number of government employees in Japan, which is 300,000, a country with a population of 120 million. The ratio of government expenditure to GDP, which is one of the measures of government size, is about 70% in Iran and about 37% in developed countries. From the 840 trillion tomans budget of the government in 1394, about 260 trillion tomans was allocated for current and developmental government expenses (the rest is the budget for state companies and banks), with the share of the developmental budget being about 40 trillion tomans (a significant portion of which is not realized). The ratio of the developmental budget to expenditure has been declining from 45% in 1376 to 16% in 1394. Thus, annually about 100 to 150 trillion tomans (equivalent to 30 to 45 billion dollars) is wasted in the public sector due to its largeness. The fifth area is the waste of the country's monetary resources in state banks. In recent years, about 100 to 150 trillion tomans have been lent to individuals and have not returned to the banks, while the largest banks in the country are state banks. In the last two years, it is still unclear how much of these resources have returned to the banks. A significant portion of the country's resources and budgets ends up in the pockets of corruption. Besides the budgets that go missing, are spent on collusion, and are allocated to over 150,000 managers—who are not selected based on merit—the economy of the country suffers about 40 billion dollars annually due to corruption. According to estimates by Transparency International, corruption alone cost the Iranian economy 34 billion dollars in one year, with 31 billion resulting from reduced productivity and 3 billion from foreign investment efficiency. The entire budget and revenues under the leadership apparatus are classified as corruption due to a lack of transparency (corruption is defined by a lack of transparency). A significant portion of other country resources is funneled to security and military forces through smuggling, the extent of which is unclear, but given that in the field of importing industrial goods and machinery and electronics, these state and government institutions reap the main profits, this level of corruption must also be in the billions of dollars. Annually, 4.5 billion dollars worth of smuggled clothing enters the Iranian market. The head of the handmade shoe union says, "Only 7 million dollars of about half a billion dollars of shoe imports to the country is legal." 50% of the cosmetic market in the country consists of smuggled goods. About 91% of mobile phones in its billion-dollar market enter the country through unofficial channels and smuggling. The value of smuggled goods to Iran in 1392 was between 20 to 25 billion dollars, which is about half the value of goods that were officially imported to Iran that year. Income from a portion of the country's resources is pre-allocated without going through the parliament or government. These are special privileges for Shiite clerics and holders of positions in appointed institutions. Some Shiite clerics have foundations and companies that are connected to state currency, state land, and low-interest government loans (such as the economic institutions connected to Imam Sadiq University and Mofid University, to provide examples from both factions). The leadership apparatus allocates billions of dollars to itself annually without any necessity for the existence of this institution and spends it however it wishes. Only 15,000 people in the form of the "Guardians of the Order" protect Khamenei, whose annual salaries and benefits (such as insurance and bonuses) amount to about 180 billion tomans (based on about 2 million tomans per month for each person). This guard also incurs costs for equipment, supplies, and workplace, among others. There is no information on the exact expenses and costs of the leadership office, but the expenses that Khamenei has in the office, seminaries, and abroad, and the income of foundations under his supervision are in the range of several tens of billions of dollars. The assets of the institutions under the leadership are in the range of hundreds of billions of dollars (such as the Executive Command Headquarters and the Foundation of the Disabled and the Astan Quds Razavi), and no individual or institution can hold these institutions accountable. Ambition and arrogance According to various estimates, about 4 to 10 billion dollars are spent annually on the Islamic Republic's military interventions in Syria, Lebanon, Iraq, Yemen, and other parts of the Middle East and Africa, and military assistance (weapons, logistics, military training for allied armed groups) is provided. Even if the war in Syria ends in favor of the Assad regime, just like Lebanon in 2006, it is only the Islamic Republic that must play a role in the reconstruction of Syria to keep the country on its side. According to various estimates, Syria has incurred about 275 billion dollars in damages so far. Bashar Assad has declared this figure to be 200 billion dollars. The Islamic Republic must pay for the reconstruction costs of this country to maintain its influence in Syria, and these billion-dollar expenses will continue for years. The IRGC has been investing in various economic sectors in Syria for years. On the other hand, the Russians and Chinese have not spent on the reconstruction of any country so far. The approximate figures above—after determining the annual amount of some of them—can be summed up to reach a lower and upper limit of these expenses. You will see that the average of these figures exceeds the country's annual oil revenues and is about half of the annual budget of the country (840 trillion tomans, equivalent to 240 billion dollars in 1394). Even most of the expenses incurred for corruption and privileges are ultimately not invested within the country (capital outflow in recent years has quadrupled).