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Monthly Archive: January 2004
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January 30, 2004

Right Man vs. Right Rights
Somayeh Sadat  [info|posts]

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The family law in Iran, rooted in the so-called traditional Islamic law, is archaic and unjust indeed. For a woman to marry, her consent and that of her father are both needed but to terminate the marriage, the woman has no say. The right to divorce is totally and unconditionally [almost] granted to the husband.

From a woman's perspective, once married, there is no way out without her husband's consent unless there are certain circumstances such as proof of physical/emotional abuse of the wife by the husband or evidence of substance abuse on his part. Even if these circumstances happen, they are at best subjective issues decided upon in courts.

The husband, however, can terminate the marriage at any time, just with some minor legal obligations, such as paying the woman her nuptial gift and [recently in Iran] her financial share of their common life. To make matters worse, the right to custody of their children is also by default granted to man. So a man can wake up one morning, decide he wants a divorce, pay the woman her share, and raise the children himself, all done legally. This may totally ruin that woman’s life, and there is no protection in the law against it.

There are other inequities s as well. Women need their husband’s legal agreement for traveling abroad and husbands can actually prevent them from working or even leaving the house, if desired. How have women responded to this inequity? Their approach has been quite disappointing. For years, women and their families have looked for the "right man", instead of trying to gain the "right rights". In their view, the chances of a divorce when living with the "right man" are slim. Moreover, to balance their legal positions in times of dispute in their favor, they ask for an exorbitant nuptial gift that the man obviously could not pay. This way, if the woman ever wants a divorce, she could put her husband in the dilemma of either going to prison because he could not afford the nuptial gift, or giving her the permission to get a divorce and perhaps the custody of children so that in return she waives her nuptial gift.

I think the time for this temporary solution is over. Women should now try to gain the "right rights". Although they can't probably change the laws in the near future, they are legally able to add extra conditions to their marriage certificate [as a legal contract under the Iranian law]. They can ask for a unilateral right to divorce , as well as an equal right to the custody of children. Surprisingly, the majority of women, even the educated ones, are not doing this. They are still hoping that the man they are marrying is the right one, and that threats of high nuptial gift will suffice to ensure they don't get trapped in an unhappy marriage.

I believe that it's now time for all women in Iran to ask for these rights at the time of marriage. I also know that unfortunately not all women are in such a position to ask for such rights. Therefore I think it is the moral duty of all women who are in such a position, to do so, so that over time this becomes a norm in the society and no woman will be scared to ask for these rights. Then hopefully one day the nuptial gift really means what it was meant for: a simple gift given by the husband to the wife, and not a threat by the wife. Right?

January 28, 2004

Ad Inferna per Aspera: Part I
Kaveh Khodjasteh  [info|posts]

inferna.jpgThe coming year is expected to be a trying year for the Iranian government, in both of elected and non-elected parts. I wanted to document and list some of the most important challenges that the Iranian government shall face in the coming year here.

1. The Election Crisis: As almost everyone expected, but not many said, the Guardian Council decided to vet most of the Iranian parliament candidatory hopefuls, before they faced a public vote. Some interpret this as a power play between the left and right in the Iranian government and some expect more important political consequences.

2. Presidential Elections in Iran: Another equally important but often silenced question, has to do with the coming presidential elections in Iran, expected actually in no sooner than a year, if the current government finishes its term. The reformists [which I shall not dignify to the level of an opposition party] have no agreement on a new leader of the dying [or at best evolving] reform movement, and in fact have never campaigned on behalf of anyone in this regard. The conservatives, on the other hand, have already started campaigning on behalf of two strong candidates, namely Mohsen Rezaei and Mohammad J. Larijani. The election itself is expected to be free, but the lack of a real popular candidate will put the level of participation in the most fundamental election in Iran in a serious jeopardy.

3. Public Apathy: Along the above points another difficulty for the government will actually come from the overwhelming public apathy. People [middle class and higher, actually] seem to care less about how they are governed everyday. In case of the Iranian government that has always claimed the public trust but has never produced any loyal second generation, this could mean the end of a, once assumed, glorious path. The public participation in the elections will be a simple measure of this factor.

4. Globalization of Media:
Censorship and redirection of information is an essential tool of statesmanship since the oldest times. In case of an ideological state like that of Iran, it is the most important tool. TV and radio are under strict control of the non-elected parts of the government, while the elected part exercises a softer control on the written media, subject to harassment and prosecution by the judicial system, controlled by the non-elected parts. Foreign media, however, have been only countered with simple brute force measures such as laws against satellite dishes, actively filtering rogue websites and such. These crack-downs have already shown their shortcomings when it comes to the ever-growing international media and new technologies. Another good question would be this: Are global media going to shape the public opinion in Iran and how is the government going to react?

I'll continue this list in a coming post. My other items are the following, other ideas?
5. Elections in the US
6. Egypt-Iran relationships
7. Al-Qaeda members in Iran
8. Iran's Nuclear Programme
9. Iraq's situation

January 27, 2004

 Life 
A Punch
Guest Auhtor: Sarah Kamal

I'm in Iran now, trying to readapt to regular life after spending two weeks in Peshawar, Pakistan, one week in a refugee camp close to Rawalpindi, Pakistan, and one week in Afghanistan itself. I'm having a bit of a hard time re-entering my old world, and have a lump of sad in my throat that can't be swallowed.

I pity the people who are around me, because I'm being even more difficult than usual. I've taken up walking everywhere — cars are too decadent for me right now — and what I call voluntary simplicity is driving my family bananas, since I'll walk forty minutes under the midday sun rather than spend 10 cents on a taxi, and wander home alone at midnight through the streets of Tehran rather than climb into the car with my Dad and step-mom (even though they are going to the same destination). Hello, re-entry shock.

It's madness, I know. It makes me laugh and smack my head to type this, but my current mad-ness also led me to punch a poor unsuspecting guy in the street a few days ago.

You see, I was walking in the streets a few days ago when a guy started following me and asking for my phone number etc, etc, ad nauseum. I didn't give him the time of day. Then another guy began trying to arrange a date with me, and I told him to get lost. By the time a third guy began hounding me, I was pretty annoyed. Men in Tehran can be pests, but this was ridiculous! It was only a bloody fifteen minute walk, and I seemed to have chosen the street full of idiots. So I just ignored this third guy - he wasn’t even worth the bother of speech.

But he was persistent. He followed me for a good half-kilometer or so, muttering things at me the entire way despite the fact that I was almost sprinting to get away from him. Then he fell behind, and with a sigh of relief I began walking across a small park towards a shopping complex.

But of course, since I no longer had an idiot, I had to find me another idiot. And this idiot was in the form of a tall bearded man who told me to put my headscarf on properly. So I whipped around and said "what business is it of yours?!!", gave him the finger, and walked on, taking my headscarf off my head completely and flipping my hair in his direction. I was now fuming.

As I walked into the shopping complex, I replaced my headscarf loosely, hackles still raised. And it was at this unfortunate moment that idiot number three decided to catch up to me and whisper sweet nothings in my ear. I don't remember much, other than him saying something like "I've found you now" and then my sensing a hand touch my waist, and then

KAPOW!!

my fist shot out into his kidney. When he turned a completely shocked face to me, I pointed my finger in his face, said "don’t touch me" in a quiet and intense voice, then marched on. He disappeared.

I don't know who was more surprised by the punch...he or I! I'm generally non-violent: I let non-malaria mosquitoes drink freely of my blood, and even cockroaches have nothing to fear from me, other than the occasional screech of terror and disgust. (I do beat up my brothers sometimes, but only because I like them, have their best interests at heart, and the stinkers deserve it.) I never ever ever hit for real.

But you know what? I'm glad I hit this guy. Once my sense of humour returned, I became more and more pleased with myself. In fact, I was grinning the entire way home because I realized that I've wanted to do this for a very long time but always held myself back.

I've always felt that it's unfair to lash out against men and women when they stifle me with gender restrictions or diminish me into a sexual object. After all, the society they live in allows the things they do, and they themselves likely don't know any better. I said nothing when my buttocks were squeezed in the crowded marketplace in Afghanistan (I was fully covered in the burqa); I walked on when the police officer, rifle in his hands, told me to cover my hair properly in Iran; I turned away when the fruitseller told me to cover my breasts with my headscarf in Pakistan (I was dressed appropriately in a salwar kameez).

The dirty old man with the goggles crouching underwater in the pool, watching me (watching me) swim in Hong Kong, the idling car stalking me (stalking me) down the streets of Los Angeles, the guy grabbing me (grabbing me) as I'm dancing with friends in Canada. They live on in my mind, imprinted.

My feelings on these incidents make no rational sense. I can't explain why I feel humiliated when young men flip through Hustler magazine in front of me – I think nudity is beautiful, but quite a few types of porno make me feel bad (perhaps I'm repressed?). I can't explain why I am moved to tears of fury when I see women with veils covering their faces walking behind their husbands — I respect different cultures and ways of being, but can't accept that women should be covered and secluded (perhaps my mind's not open enough?).

Somehow, I always tell myself that I don't have the right to make a fuss — that I'm living in a society that is governed by a culture to which I must conform. And somehow little humiliations pile up and I am silent, because really, each incident is so little and unimportant, and making a scene won't solve anything.

But ah! But then I punch this guy. Unfairly. And I don't care. I'm happy!

I punch him because I'm frustrated at the big goddamn amorphous blob called Society called Perceptions called Attitudes — enemies I can't see don't understand can't fight; I punch him for all the times I didn't act because I was afraid or thought it would be wrong or thought I would disrupt; I punch him because there is a beautiful talented 24-year-old woman, my Afghan sister-self, lady E, chained to her house, a refugee in Pakistan while I am so free that I can hold her hand then leave (and I know she is still there weaving beautiful works of art so she doesn't go crazy and that HURTS); I punch him because there are intelligent fabulous competent women in Afghanistan who are imprisoned by fear, slaughters, beatings; I punch him because there are more intelligent fabulous competent women all around the world who are free and do NOTHING; I punch him because every time a little girl is denied schooling, every time a woman is forced to stay at home, every time a woman is seen only for her body and not her mind her soul her spirit, a little piece of beauty dies; I punch him because inside I am roaring goddammit SEE US!

And the poor guy bears the full brunt of my anger against societal restrictions, women and men bound by farcical and impossible laws in Afghanistan, and sanction through apathy in one swift, angry, unthinking lashing out of my furious fist.

God. It makes me so angry.

He's lucky he got away with just a bruised kidney.

Sarah Kamal is a graduate student at Department of Comparative Studies of MIT. She has spent several months in Afghanistan working for an Afghan NGO called HAWCA (the Humanitarian Asistance for Women and Children of Afghanistan). She keeps a personal diary of her reflections on her trip. The above article was originally published in her personal website under the title of "I am Pissed off" as a part of the letter series that she wrote for her friends back in school.

January 25, 2004

America's Short-Term Memory Dilemma
Ali Mostashari  [info|posts]

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A recent poll by the International Herald Tribune and the Pew Research Center for the People and the Press, reveals disagreements between America and other countries on whether U.S. policies played a significant role in fueling terrorist actions against the United States. Asked if many or most ordinary people consider U.S. policies to be "a major cause" of the Sept. 11 attacks, fewer than 1 in 5 respondents from America said they do. But in the rest of the world, nearly 3 out of 5 agreed that they would. Many people in America have often wondered why there is resentment of the United States in the world, not just in the Middle East, but Europe, Latin America and Asia. Surely there have to be different reasons for people in El Salvador to be resentful of America than Al-Qaeda?

The answer may lie in the fact that America is suffering from a short-term memory problem. People forget the consequences of the cold war and U.S. foreign interventions, that has left open wounds in the entire world.

Aside from Islamic fundamentalists, there are others who protest America's hegemony for different reasons. Not because they "hate our freedom", but because America as a superpower has not projected its domestic democractic values to the world, but has mainly shown its Nuclear bombs, cluster bombs and Napalms. So instead of choosing to be admired as one of the most progressive nation on the earth, America chose to be feared. But most often fear does not result in respect.

Agreed, one can't be the nice guy to stay a superpower. One has to kill, assassinate, support repressive regimes and go to wars. This results in strange and sometimes embaressing situations: Yesterday’s freedom fighting hero Bin Laden (when he was fighting the Soviets), becomes today’s terrorist and “evil one”. Saddam Hussein who received Chemical and Biological weapons from the U.S. in the 1980’s to fight the Iranian threat, became a “ruthless dictator”. Not to mentions Iran-Contra, Noriega and many other scandals yet to be exposed.

It's not just the U.S. From the dawn of human civilization, super-powers have had to do all sorts of dirty things. The Persian Empire for instance that many Iranians are proud of massacred so many people in their paths (refer to non-Iranian textbooks), as did the Islamic empire. This is how empires work.

The U.S. however, faces a more serious challenge than its predecessors: It has a democratic structure domestically, and has to come up with "noble reasons" for its military actions. The American people want a strong leadership that protects American (corporate) interests in the world, but they also like to feel good about it. “Liberation” seems to be a fashionable word.

I have compiled a list of historical "liberation" related events, as a memory refreshment exercise, which may at least partially explain the resentment. The memory of the American public is short, usually less than four years. But sometimes, in older parts of the world , with thousands of years of history, people don't forget that easily. It is hard to forget when people are traumatized. It doesn't seem that further show of strength can actually help solve this issue, nor is it likely that the "Tough Love" solution proposed by the previous posting is the silver bullet. Maybe America should choose to show its democractic sides, and a respect for human dignity of all people, instead of showing off its military might, but that may not be a realistic solution either. The dilemma is "to be or not to be" a superpower.

_________________________________________________________________

1) Official War Civilian Casualties Caused by U.S. Armed Forces

Wars "Collateral damage" incurred by U.S
_________________________________________________
WWII- Hiroshima 135,000
WWII-Nagasaki 64,000
Korean Penninsula War(1950-53) 1,185,000
Vietnam War (1965-1973) 1,300,000
Cambodia (Conflict) (1970-1973) 550,000
Laos (Conflict) (1960-1973) 22,340
Grenada Invasion (1983) 250
Panama Invasion (1989) 332
First Iraq War (1990) (direct deaths) 35,000
Second Iraq War (2003) (Direct deaths) 9,878
_________________________________________________
Total 3,301,800 (rounded)

Source:
Compiled from Death Tolls for the Man-made Megadeaths of the 20th Century (http://users.erols.com/mwhite28/warstatx.htm). There are different data sources with different set of stats. Only one has been chosen for this article.

2) Indirect U.S. caused civilian casualties (these include minor incidents, U.S. backed death squads and military coups, and casualties of U.S. imposed embargoes. )

Event Civilian Casualties attributable to U.S.
__________________________________________________________________
Coup in Iran (1953) 134
Coup in Chile (September 11,1973-December 1974) 26,000
Civil War Guatemala (1960-) by U.S. backed death squads 135,000
U.S. backed Military government in Indonesia (1965-66) 1,100,000
U.S. backed Contras in Nicaragua (1981-1990) 50,000
Shooting down of Iranian Airliner by U.S. Navy 290
(Note: The Vincennes commander who shot down the airliner was decorated upon return to San Diego. The U.S. government regretted the incident, but never apologized.)* Source: Newsweek, “The Sea of Lies”, 1998

U.S. imposed embargo on Iraq (1990-2000) 1,500,000
(Source: Ret.General Ramsey Clark,UNICEF)
_______________________________________________________________
Total 2,761,400 (rounded)
Source: Death Tolls for the Man-made Megadeaths of the 20th Century (http://users.eols.com/mwhite28/warstatx.htm)There are different data sources with different set of stats. Only one has been chosen for this article.

Grand Total = 6,060,000

January 24, 2004

Tough Love and Global Adolescents
Guest Auhtor: Alexandra Westland

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Anyone who has been a parent long enough is familiar with the phenomenon of the hormone impaired, know-it-all, teenager, who is a danger to both himself and his friends. The kid who regularly makes his parents desperate to answer one of those ads in the back of the family magazines for a boarding school far, far away that will apply Tough Love to their little spawn and in theory, make him fit for civilized company by the time he is thirty-five.

Adolescents have an over-inflated ego, believing themselves to be super competent, knowing everything as well being convinced they are immortal, while actually suffering from overwhelming feelings of inadequacy and a mortal fear of hard work. Teens consistently want everything their way. They sleep all day if at all possible and stay up too long into the night. They scream, "I hate you," for no apparent reason and in the next breath, demand their allowance. They blame everything on everyone else, especially their parents, while failing to take responsibility for their own actions claiming straight faced, "You made me do it i.e lie, "borrow" the car, “borrow” the money, etc. because you would not let me go with my friends and stay out all weekend." One day the parents wake up and look at their "special" child, the one who was so interesting and had so much potential just yesterday, asking, "Who ARE you"?

So too was the world rudely awakened on 9/11 and is now looking at the Islamic ummah all claiming to be following the "Religion of peace," while some peace lovers were slamming fully loaded jet-planes into sky scrapers, asking: "Who are you"?

On the six-o-clock news, day after day, we watch in bemused bewilderment incessant reruns of the writhing, screeching, spitting sons of Allah, with toothless open mouths, their fists punching the air screaming, "WE HATE YOU, WE HATE YOU, WE HATE YOU," and wonder if they've all got a screw loose or just haven't had any breakfast. Yet, like any good parent, the West is expected to continue giving a generous aid "allowance" in a gesture of unconditional love to the indolent sons of Allah; because, they are not working and are not employable due to having obtained one too many "religious studies" degrees in some non-accredited madrassa—And of course, that is all our fault!

Islamic clerics screech in nasal tones, crying crocodile tears every Friday from the bully pulpit of their mosques, "Islam is perfect! It is for all time! It is absolutely compatible with modernity and of course. . . adulterers must be —stoned." In the meantime, millions of sons of Allah are risking their lives trying to immigrate to the West because in their part of the world obtaining a piece of falafel is getting harder and harder to do.

Like all teens, the sons of Allah claim they know "everything!" EVERYTHING one needs to know is contained in the "perfect" Qur'an and the hadith from nuclear physics to how to cut one's finger nails—i.e., like this: " . . . start from the right index finger to the right small finger then the right thumb. Thereafter, the left hand from the small finger to the thumb. Cutting of the toe nails will be from the small left toe to the small right toe." (Mirqaat vol.2 pg.45) and Allah Ta'ala Knows Best”

And they HATE our clothes. Unlike our adolescents, the sons of Allah don't want us to look "cool" to keep us from embarrassing them down at the mall in front of their friends. No, the sons of Allah prefer we make ourselves downright ugly in a shroud made by Omar the Tentmaker, a garment that will hide the shapes of our women and make our females look as unappealing as theirs. Although, fair is fair. It would really be a blessing if some of our 300-pounders would wear the burqa. One cannot deny that the veil certainly does solve the "what to wear" dilemma if one only has one sack in one color—black—simple.

Like any adolescents, the sons of Allah are hormone impaired and sex obsessed. The whole focus of their failing societies appears to be on how to keep evil in check by covering the source of evil—women—from head to toe to fingertips, so as not to let "evil out" an evil that would tempt those weak, undisciplined sons of Allah into immorality. In the mean time, they are "doing it," behind the tent with the sanction of a little thing called "temporary marriage,” to anything that is moving from nine to twenty-five. After that, women are too old anyway and only good for being recycled for 72 raisins in Paradise.

And of course, like any kid, the sons of Allah insist on their right to obtaining things that are dangerous, such as WMDs, long before they are mature enough to handle these; shrieking and demonstrating that "everybody" else has them, especially the highly precocious Jewish neighbor kid, the one who consistently wins the science prizes and plays the violin to boot.

So we pace and debate and worry that the recalcitrant sons of Allah are going to do something rash and hurt someone in their adolescent zeal, all the while asking the professionals, "What to do, what to do"? The answer comes to us after much soul searching and many sleepless nights:

"Now, darlings, you just calm down and drink your tea. No, you can not play with those nukes!

Mommy is just going to have lie down in a darkened room with a cold cloth on her head. And after the migraine goes away, she will call about that nice boarding school in the middle of nowhere, the one with the great, big fence around it, that might be able to apply some Tough Love and make you fit for civilization in a decade or two; not to mention bring up your test scores. In the mean time, we'll just have to lock you all in your room."

© 2003 Alexandra Westland
Westland is a writer who travels a great deal in Europe, the U.S. and Asia; never staying in one place very long, thus, keeping herself a moving target. Not being obese and having made a heavy investment in a wardrobe, Westland has no intention of wearing a burqa. Given the penchant of the "Religion of peace and tolerance” to issue death fatwas for telling the truth, Westland also has no intention of using anything but a pseudonym.

For more on how this post was formed, look at the background information provided at WessLog.

January 23, 2004

Free Speech in Practice
Babak Seradjeh  [info|posts]

freespeech.jpg If a person shouts at you in the street that you are a wretched of a human being and do not deserve to be where you are, is that considered an instance of Free Speech? My personal answer would be "yes!" What if you are sitting in your seat at a discussion conference on "economic prosperity and its effects on civil society" (a made-up title, of course) where people are to ask questions from a panel or a speaker, and the same thing happens? My answer would still be "yes!" I guess there is little place for disagreement on this affirmative answer, as it derives from a quite basic understanding of Free Speech.

What if the police or the security personnel ask the person to be quiet or demand that s/he leaves in each case: should they have the right to do so in a free society where Free Speech is the rule? My answer would be "no!" in the first case, and "yes!" in the second. The reason why I think so has nothing to do with Free Speech per se, but the purpose of each gathering. In the first case you are not in the street to serve any particular purpose; you are there just because you are a member of the reference society you live in, and the person who shouts at you is there since s/he is also a member of the same society. In the second case, however, you are at the conference to "discuss" the topic of the conference. Your very presence means you have accepted that as a rule. The security is there, too, to enforce that rule. So, if someone starts shouting at you, although s/he is free to do so, per the rule of Free Speech, the security has a responsibility to deal with the shouting person, for the conference to go on towards its goal as set by its topic and practice.

So, what kind of Free Speech is it then that the speaker would be effectively silenced, one might ask? The way Free Speech is implemented in free societies is rather simple, yet perhaps subtle. The reason it is subtle is that:

Free Speech is for everyone, i.e. all people should be free to speak their minds. Thus, in response to the first person who is shouting, the person who is shouted at also has a right to respond, or perhaps shout back. If that is what actually takes place, the purpose of the gathering/session/environment would be violated and the reason for which it is created undermined. That is where Free Speech should be regulated itself (not blocked or removed, I must emphasise) through two simple rules:

A. One is free to speak her/his mind according to the rule of Free Speech; yet the creators of the "environment" in which the Speech is made are also free to set regulations on the content of the Speech or the manner in which the Speech is made. They may assign regulators, who have "the right" to enforce these regulations after the Speech is made, not before—that is Free Speech should take precedence to any regulation of this sort no matter what environment.

B. The "reference environment" that is formed by the union of all such "environments" should be free of such regulations as regards Free Speech. Thus, the regulations of the sub-environments of the reference environment cannot take the form of trial or result in any sort of prosecution, criminal or otherwise.

Note that rule B is meant to prevent abuse/misuse of rule A, that is blocking or constraining Free Speech essentially and fundamentally with the excuse of higher-level regulations and/or higher moral grounds. In the body of rule A itself, the precedence of Free Speech over what regulates it in (sub-)environments (of the reference environment) is underscored.

I should like to draw some examples where it would be clear why these two rules are necessary and enough to ensure a meaningful implementation of Free Speech:

First let us consider a country. The reference environment is clearly the country itself, including its public places. Everyone should be free (by law or common law) to express their mind in spoken or written words or signs. That automatically results in the Freedom of Expression, Freedom of Press, Freedom of Gathering, and a host of fundamental rights. These are all inter-related and derive from the same principle; see, for instance, Bill of Rights, Amendment I, and some related annotations. That's what is practiced in the free world, say the US or Canada, and what the rest of the world, say Iran, lacks. However, once a group or an individual sets up, say, a newspaper, they are free to set regulations on what they publish. They do not need to publish every single line of e-mail or letter or phone call they receive. No one really expects New York Times to publish whatever one writes to them. A newspaper is created for a purpose, and its content is regulated per that purpose.

The same holds true for a web site, as an environment with expressed goals and regulating rules. The example of a web site is especially important since the web, by structure, is interactive and publishing online material has become increasingly easy, so much so that it is now instant. It is similar to speaking in a 10-by-10-meter conference room. Everyone can hear you the instant you talk. So, if I burst out in fire-rapid comments against the tyranny of clerics in Iran in a gathering room on "Scientific advancements of the Iranian society" I should not be surprised if I am asked to be silent or leave the room, or directed to another room on "The future of theocracy in Iran," a more proper topic on which to make my commentary.

As another example and to summarize: Michael Moore shouted "Same on You, Mr. Bush!" in last year's Academy Awards ceremony. I do not agree with him, but he had every right to do so as an American citizen and yet he was not given more than one minute for his speech by the organisers: he surely could not demand more time, instead he publishes books, makes films, and runs a web site where he could be heard very clearly. I take it as granted that the US is a free country, and leave it as an exercise to see that the rules I described were all followed in this case, especially the existance of the regulations and the lack of any prosecution afterwards.

January 22, 2004

Dr. Strangeluv or How I Stopped Worrying and Luv Rap...
Mehrad Vaezinejad  [info|posts]

strlove.jpg This entry has no point. You better not read it if you are obsessed with points.
It asks no questions
It answers none
Don't you continue
if you're looking for one.

I write. I am writing. I wrote. I have written. Do you mind if I write? So you don't let me write. Who the f*** you think you are not to let me write? Anyway, I will not write. I don't mind if you too write not. So, don't you write! Who the f*** I think I am to ask you write not. I can't write. Can you write? Do you mind if I cannot write? Would you tell me please what to write? Who the f*** you think you are to teach me how to write? Let us write. Let us not mind if we not write right. Let us not fight. Who the f*** I think I am to ask us not to fight?

You see?
Intellectuals are not always intellectuals
[Chorus] They need not be!
Free thoughts are not always intellectuals
[Chorus] They need not be!
They write nonsense
They read THE nonsense
They're not even always heterosexuals
[Chorus] And they need not be
[Chorus] 'f course they need not be...

January 20, 2004

Why aren't we writing?
Mehdi Yahyanejad  [info|posts]

persian_handwriting.JPGThere are around 50 volunteers who are already a part of the Free Thoughts on Iran "project", but as you see this site is not updated every day. The immediate reason is that of 50 people, only a handful write regularly. Okay, many of us are busy graduate students and we have to take care of our studies, but still writing an article, which just takes half a day, sounds not so time consuming. If each one of us just writes one article every two months, there will be enough articles to update the site daily. Now why can't we just do that?

The answer is simple: we can't write because we don't know how to write.

Why we don’t know how to write is a complicated issue. Many of us have problems writing in English. Using Microsoft Word to correct grammar and spelling or looking up idioms by searching for phrases on Google are limited remedies. Nonetheless, many of us know enough English to write our scientific papers, which should be enough for transferring most of our ideas. So what is missing?

All of us missed the writing classes that English speaking kids get in their schools. Instead, we had a stupid class called en-shâ ["Composition"]. It usually meant writing one article per semester, and some of us would get a chance to read it aloud for the class. Our papers were graded but we received absolutely no other feedback. There was also no teaching on how to structure an article. Now that I think about it, it sounds shocking. Even after 12 years of education, many of those graduates can not write an article stating what they believe or want. If you want proof, go and read the Gooya website. It is the most popular Iranian political website. It has tens of thousands of visitors everyday. But if you read the articles, they are usually just long with no clear theme. Most of the articles start from concept X and end with Y, while what was meant was Z.

Once we overcome the problem of the second language barrier and the lack of compositional abilities, we still have to create an opinion to write. This is no a simple issue and is specifically difficult for Iranians.

Iranians have a unique life experience. They lived or live in the only theocratic country of the world. They have gone through a revolution that shook their systems of belief. They went though a prolonged war. They saw the raise of religious and national emotions where thousands of youths went to the war front dreaming of martyrdom. They saw severe social repression in the name of Islam, the religion that they believed and respected. Even though many of them are deeply troubled by the politics of Western powers, they love and dream of the rule of law and liberalism practiced by them. Iranians believe that they inherited a great civilization, which has largely been left unappreciated.

Ironically, this unique life experience makes it difficult to write. We often have too much to say in a way that we give up all together because we think there will be no way that we can describe it to our listeners. Moreover, the uniqueness of our experiment makes it difficult to use a discourse developed by others. We have to develop our own.

The problem of writing should not be taken lightly. People who have never written in their life cannot read properly either; consequently they cannot read and grasp arguments precisely. This is why the politics of Iran is always stuck in generalities. Everything is done through slogans. This is unfortunately true both for the Iranian government and the opposition groups. There is no tradition of writing proper columns. The only exception came when the reform movement in Iran tried to change this trend during 1998-2000. Unfortunately, after many newspapers were shut down in 2000, that process came to a halt. Special credit should be given to the reform movement because it showed us how proper writing and exchange of ideas are important even though the reform movement itself failed to appreciate its importance and was unable to protect it.

Writing or not writing properly can affect the fate of Iranians immensely. That is why I invite the authors of FToI to be more active in writing and to take this enterprise more seriously. To get more encouragment read Hossein Derakhshan's article in Persian or Pedram Moallemian's article. The well-known English columnists and bloggers such as David Weiberger ,Jeff Jarvis ,Andrew Sullivan are putting pieces together and creating new ideas and perspectives. An active effort by Iranians to write can do the same.

Write, learn to write, and write more.

January 15, 2004

 Life 
When Will You Be Cleared?
Hazhir Rahmandad  [info|posts]
Contributing Guest Author: Maziar Tavakoli

wait.gif For hundreds of thousands of foreign students pursuing their higher education in the United States who plan to visit their home during holidays, as well as a huge number of prospective students planning to come to the U.S., obtaining a student visa to enter the U.S. is a critical task. Following the post 9/11 security measures, this task has become harder and more unpredictable for a wide number of applicants from certain countries*. In fact some consequences of these problems can already be felt as international students are increasingly choosing other destinations rather than U.S. I think this is a lose-lose situation (See the Nature's focus on this issue), where international students are losing opportunities to develop their potentials and U.S. does not benefit from their economic and scientific contributions. Ironically in the long run U.S. may also lose one of its most important levers for fighting terrorism by encouraging democratization and modernization in countries like Iran: the liberal education and rational leadership in these countries which is highly dependent on graduates of western universities.

However, this article is not about international politics, it just provides some information for students like us who should regulate their lives with international politics! There is a grave need among prospective visa applicants to know what uncertainties they should expect so that they can make informed decisions on risks they take. This article reports on the initial results of an ongoing survey to shed light on the clearance check waiting times for Iranian students applying for visa.

For Iranians and several other nationalities, the U.S. visa application process includes an initial interview (in case of Iranians conducted in a third country, as there is no U.S. consulate in Iran) and a background checking (clearance). Based on the interview conducted in person in a U.S. consulate, an applicant will be informed if s/he is conditionally accepted to be granted a visa or not. If she passes this initial phase, the U.S. consulate will file a request for background checking for that individual through federal agencies responsible for this part. Upon completion of the background checking, and if there is nothing problematic in her file, the individual will be informed (usually through some website or by calling some number) that her visa is ready for pick up and she has a two month window to go to the initial consulate to receive the visa.

There are two critical points in this process: First, if one will be accepted in the interview and second, how long she needs to wait to receive her visa. The chances for acceptance in the interview for new students vary significantly by time, nationality, and political atmosphere and may be affected by gender, subject of study, and several unknown (to us) factors.

However, for students currently studying in the U.S. the chance of acceptance in the interview is relatively good. For this group the main challenge is the uncertainty in the time they should wait outside of the U.S. before their visa gets ready. Many of you know friends or have heard of stories of students who traveled to visit home, get married, or see a dying family member for the last time, and had to wait several months or even a year for their clearance before they could come back to the U.S. and continue their studies. As a result most Iranian students in the U.S. have given up on their emotional needs and remained inside the country for the last two years to avoid becoming the subject of such stories.

The main challenge for this group is not only the long average length of the background checking, but also the significant variability in the waiting times which defeats any plans they can make to deal with the waiting time challenge. The problem is exacerbated by the federal agencies involved (e.g. state department) not being responsive to inquiries on specific cases and not giving any reliable information on what one should expect when they apply for a visa.

studentvisa.JPG

In order to reduce the uncertainty surrounding the background checking process, we decided to collect whatever data we could find through personal networks and get a more reliable picture about the average waiting time and the variability across different cases. Moreover, we aim at inferring any informative patterns that can emerge out of this data about the effect of different factors (e.g. gender, field of study, place of application) on the waiting time that an individual should expect. In response to our request for data, so far we have received reliable information on 42 cases of successful visa application from new (20 people) and current (22 people) Iranian students in the past year. We hope the following summary of results is useful for those who want to make an informed decision on leaving the U.S. or applying for the first time, and encourages those of you who have more information to supply us with more cases so that we can reanalyze the data soon and come up with more reliable results.

Four conclusions can be made based on the current data. First, the average waiting time for clearance is still fairly long. For our sample in average people needed to wait about 2.7 month before their visa was ready, which is still very long for most graduate students. Second, the new students have significantly shorter waiting times than current students. This is troubling news for current students who are more sensitive about waiting time because of their ongoing research and commitments in the U.S. Third, there is good evidence in the data that suggests women have shorter waiting times than men. In fact, new female students wait as short as 0.9 month in average, compared to about 2 month weighting time of new male students and 3.2 month waiting time of current female students**. The worst waiting time goes to men like us who should expect an average of 3.7 month for their clearance period. Finally, the variability in the data in waiting time is very high, ranging from a few days to over a year. A standard deviation of 2.4 month for the whole sample witnesses this fact and suggests that there is little planning one can do to cope with the waiting times***. The following graph shows the number of applicants in our sample who where waiting for different numbers of month.

At this stage we don’t have enough data to tell if applying in different consulates (e.g. Dubai, Ankara, Istanbul, Cyprus) makes any difference on waiting time and what is the effect of field of studies, if any. Moreover, one should refrain from reading too much into these numbers because of the small sample size and possibility of bias in responses. Nevertheless, there is a good chance that we can give more specific answers if we include more data points in our analysis. Therefore, we want to make a plea to audience of this forum to supply us with following information about anybody they know who has applied for the U.S. student visa in the last year (older data is not so informative about current trends) and forward a link to this article to others who may have such data. Please try to tell us about ANY case you come up with, rather than the bad/good cases. This is especially important in order to reduce the sampling bias of this survey.

1- Name
2- University- Program/Field of study
3- When they applied for visa
4- How long it took for clearance to get ready (in case they were denied, also let us know)
5- First timers (new students) or current students
6- Where they applied for visa

Please send this information to Maziar Tavakoli-Dastjerdi (maziartavakoli@yahoo.com) with the subject line “Request for visa information”. Meanwhile, be confident that all the data that can be used to recognize an individual is to avoid duplicate counts of one person and will remain confidential with the authors. But if you still don't feel comfortable with sharing the name, feel free to only include the initials.

* No need to mention that Iran almost always falls in any list of “certain countries”.
** This number might be too high, considering a single case with over a year waiting time falling in this category.
*** Removing the one very long waiting case, the standard deviation changed for different categories from 0.6 (new girl applicants) to 2 (current boys). In general, one should be prepared for a waiting time of “Average+Standard Deviation”, e.g. 3.7+2=5.7 for currently studding male students, as there is a good chance such scenario happens to him/her.

Maziar Tavakoli-Dastjerdi is currently a Ph.D. student in the Department of Electrical Engineering and Computer Sciences of Massachusetts Institute of Technology.
Concentrated Credit Risk, Directed Lending, and Speculative Activity: Some Clarifications
Ali Meli  [info|posts]

risk.gif

Following the initial posting about Iranian Credit Markets, Borghan Nezami, one of my colleagues posted A Note. In his note, my views, as expressed in A Case for an Iranian Asset Bubble and the Role of Iranian Credit Markets are misrepresented. His note mentions a list of underlying assumptions in my article, whereas I never made those assumptions, either explicitly or implicitly; he then refutes the article and considers it misleading based on that list. Since his interpretation of the underlying assumptions and the conclusion in that article are not correct, it will be beneficial to all of us if I clarify them. I start by summarizing the main theses behind my original post and then respond to Borghan's claims about my article.

My views about the Iranian credit market are:

1- The lending policy in Iran encourages too much risk taking by the borrowers (for example low interest rates on directed loans for people with connections or the checking system)

2- Concentration of credit risk and poor risk management in Iran, rather than the size of private debt, is dangerous (In case of directed loans the risk burden is on the banks and for the checks it is with people who have accepted the checks)

3- The credit policies favor speculative activity financed by reckless borrowing (for the lucky few who can get credit at low rates and without limit)

4- People can access unobservable amount of credit via the checking system (I hope to explain in another posting how you can trick the checking system in Iran to gain literally unlimited amount of credit).

5- Most of this speculative activity is concentrated in the real estate market (many of the big construction projects like Atisaz by Bonyad Mostazafan are financed by directed lending), which has created a bubble.

In summary, my biggest concern is about the credit risk and how it is managed.

A review of Borghan’s claims about my assumptions and why his claims are not true:

Before I go to the details, I believe the biggest misunderstanding about my article is that he thinks I view checks as the only or the single major factor in the bubble. Nothing can be further from the truth. I mentioned directed lending and sandough-e-gharzolhasaneh along with checks as credit instruments in Iran.

1. He claims I assumed “Checks are always accepted as a form of payments:”

I never made such an assumption. All I said was that some of the checks in Iran are used as a form of credit instrument similar to credit cards. Furthermore, checks are only one example of what I mentioned in the article. I specifically mention three items as unhealthy debt instruments:

a. Directed Lending: The government forces banks to finance certain companies that have close ties to the government. Also, the government is using directed lending to finance its own debt.

b. Sandough Gharzol Hasaneh: I guess we both agree that these are mainly a scam by bazzari’s and the religious rulers to borrow money without paying transparent interest rates.

c. Dated Checks: The way these checks are treated enables some people to use them as an unlimted sources of credit. An example of such an abuse happened during what became known as the "123 Milliard Toman" scandal (the case was prosecuted by Mohseni Ejei and during which some reports of credit abuse by certain institution emerged).

I cannot understand why Borghan thinks my arguments are based solely on checks.

2. He claims I assumed “The Interest Rates on Checks Are Almost Zero:”

For many short-term purchases, this is basically true. If you are not buying a big-ticket item, you can get away with “zero percent financing.” For larger purchases, even though the checks are discounted against the interest rates, the person receiving the check cannot verify the amount of borrower’s outstanding debt.

In addition, in the financial markets, what counts is the difference between interest rate that you pay and the risk free interest rate. Again, given that the risk free interest rate in Iran is about 20% (or somewhere around that), any discount rate below 20% encourages borrowing by financial arbitrage: people can borrow money at below 20%, put it in the bank and receive the 20% interest and make a profit in the process. So risk premium in Iran = interest rate – 20%; as opposed to 13% inflation rate that Borghan refers to. (a more detailed discussion can be find in books and articles about CAPM).

Furthermore, in the article I once mentioned that what counts (in the goods market) is the real interest rate: the difference between nominal interest rate and inflation. With that in mind, in many instances of directed lending, actually people are paying negative real interest rates which encourages reckless borrowing by those who have access to directed loans.

For a financial perspective, I refer the readers to Asset Pricing by Cochrane (a University of Chicago guy) and Principles of Financial Economics by Stephen F. Leroy and Jan Werner. For a more macroeconomic perspective, you can look at Macroeconomics by David Romer (Berkeley guy) or Lectures on Macroeconomics by Fisher and Blanchard (MIT).

3. He claims I assumed “Banks are responsible for paying checks:”

I never said that. The danger to banks comes from the directed loans. As for the checks, the defaults do not affect the banks but the potential ripple effects destabilizes the whole economy.

4. He claims I assumed “There is no punishment for default:”

Again, I never said that; what I said was that people with default history have the same level of access to credit market that people without default history. Yes, you will go to jail for not paying your checks, but after you come out, you can open another checking account quiet easily. In America, a trace of bankruptcy will haunt you for at least 15 years; your life will be very miserable because you may even have difficulty finding a job with a bankruptcy history.

5. He claims I assumed “Banks easily lend to individuals at low interest rates”:

First, in my article I did not restrict myself to individuals; but many individuals and government-sponsored companies have access to low interest rates via directed lending. Furthermore, what counts in financial markets is the difference between corporate (or individual) interest rates and the riskless interest rates (basic CAPM). As I mentioned, the riskless interest payments are about 20%; so actually, if you are borrowing money at 25%, you are paying a 5% premium. A 5% premium is very close to the premium that corporations with a BB rating pay in the US. So yes, I believe that there is an imbalance in the interest rate markets; though I am not sure if this is because the 20% riskless rate is two high or 25% interest payments are two low.

* * *

Then, after alleging that I make these five assumptions (and as I mentioned, I do not make at least the first four assumptions), Borghan says that I conclude the private debt level is two high. Nothing can be further from the truth; all I concluded was that the structure of credit markets in Iran has encouraged reckless borrowing by high-risk economic entities, which has resulted in speculative market activity. But I believe that since the credit risks are concentrated among very few economic agents and is not properly managed, the consequences of a bubble burst for the economy can be very severe.

Borghan is very correct that the level of debt in the US is much higher than that of Iran (compared to GDPs of course). But the credit risk is far better managed in the US. Alan Greenspan this week mentioned that in the 1990’s, telecoms issued about $1Tr in debt and they defaulted on most of it; but since the risk was diversified through use of credit derivatives the US economy and the banking system was able to survive the aftermaths.

I think we both agree about the necessity of maintaining credit histories and default records to have a sound financial system.

One last thing, I had a different (and narrow) view about the definition of moral hazard; to give an example, my understanding was that if people buy insurance and as a result of having insurance engage in risky activities, this would constitute moral hazard; according to Pindyck and Rubinfled (2001, page 669) is:

"When an insured party whose actions are unobserved can affect the probability or magnitude of a payment associated with an event".

In their book, when they talk about markets with asymmetric information they treat Quality Uncertainty(market for lemons), Market Signaling, and Moral Hazard as three different but closely related topics.

As Borghan pointed out, this definition is too narrow. As he points out:
" Moral hazard comes from 'Hidden Action' in any Principal-Agent relations, and
not only insurance. For example in the case of banking in Iran it's very common that sometimes some people take a loan for building their house, which is very low risk activity, and then invest the money in a risky business activity; This is called 'Moral Hazard' as well".

Thanks for pointing this out Bourghan!

In the end, I hope that we all have gained something from these discussions.

January 14, 2004

Reformists in danger, people reluctant to help
Hossein Derakhshan  [info|posts]

not_listening.JPGI'm not a right-wing fan in Iran or elsewhere, but I think the recent protests by the reformists about their ban to stand for parliament, is more of a power struggle than really fighting for people's basic rights.

There is a big conflict of interest here at the ongoing sit-in and requesting people to join it; because their own fate, as a political faction, is in danger in the near future; as well as it is a threat to people's right to elect.

But personally I guess if the reformist MPs were in fact after people's rights, amid their own risks, they should've done the same when the Guardian Council rejected the bill to join 'the UN convention against discrimination against women', or even when they rejected the bill to revise the present election law.

Should the reformists really want massive support, as Alireza Alavi-Tabar suggests, they have to radicalize their platform and to define a new framework beyond the constitution. They all know where the problem lies (the unlimited power of the uncontrolled Leader) and they eventually have to do something about it.

Alongside, they could separate themselves from the conservative groups such as Rohanioon Mobarez (Mehdi Karrubi's group) who have cleverly displayed themselves as reformists while they all believe in, more or less, the same principles as the conservatives. The irony is that Karrubi and all other nominates from his group are accepted by the Guardian Council.

I don't think Iranian youth would engage in the current political row unless they see a real change in reformists platform, which could translate to a collective call for changing the constitution or something as politically significant.

January 13, 2004

A Short Note on Credit Market in Iran
Borghan Nezami  [info|posts]

I should thank Ali Meli's post for opening the discussion about credit market in Iran. However, I think it is very misleading and, as an economist, I have to clarify it.

The most important underlying assumptions in his discussion are:

1) Checks are always being accepted as mean of payment (which is obviously not true);

2) Interest rate on debts which are secured by check is almost zero! (in contrary, they're very high, since lenders always take to account the highest possible risk of default, calculating the expected interest rate plus the the highest risk of default, and then asking for that amount as future payment);

3) Banks are responsible for paying for overdrawn checks (which is incorrect: banks just freeze the account observing the first overdrawn check; in contrast to most of checking accounts in North America, where the bank honors its check and pays it, and just charges a penalty to drafter);

4) There is no punishment for default (Actually if you default in the US, you can file for bankruptcy and it'll only lower your credit score, but in Iran you'll be jailed!);

5) Banks easily lend to individual at low interest rate (please name a bank which charges less than %25 interest rate for individual loans. Given the average %13 inflation in Iran, this means %12 net interest, one of the highest in the world);

Given these assumption, Ali concludes, the amount of outstanding debt is relatively high in Iran.

But quite opposite, it's very low; The outstanding non-governmental debt to banking system, which is mostly firms' debt to banking system and not housholds' debt, is less than %30 of Iran's GDP; Just to have an idea, morgage debts are about %60 of US GDP!

Due to lack of something like "Bureau of Credit”, which should keep track of people's credit worthiness, there is huge moral hazard and adverse selection going on in Iran’s credit market, causing less lending and therefore less borrowing. (There is a very tiny market for mortgage and no market for unsecured credit, i.e. credit card, in Iran).

I think it's incorrect to think the reason for real estate bubble is high outstanding debt; quite opposite: since people can’t invest their saving in an efficient credit market, by lending to those who want to borrow, they have to use other markets like real estate, car market and etc. for keeping their savings.

However, the cure will be exactly what has been mentioned in Ali Meli's post: Establishing Bureau of Credit, which keep track of people’s credit history and its data can be used for computing their credit worthiness; then different people with different default risk will be treated differently, lowering adverse selection and moral hazard, leading to more efficient credit market.

*Adverse Selection: When there are different types, and one cannot distinguish between them and treat them similarly, it's called "Adverse Selection"; for example, when banks can not determine whether a borrower is high risk or low risk, they can't assign different interest rates, to compensate for different default risks, and they have to treat both types similarly; obviously, this causes inefficiency

** Moral Hazard: Again, when types cannot be determined, when two different treatments are proposed, one type can pretend to be one of the other types and enjoy the better treatment. For example, if two different interest rates being proposed, obviously high risk borrowers will pretend to be low risk and enjoy the lower interest rate.

Sorry for short discussion and lack of sufficient statistics; I'll try to post a more elaborated version within a week.

A Case for an Iranian Asset Bubble and the Role of Iranian Credit Markets
Ali Meli  [info|posts]

images.jpg

The lack of transparency in credit markets is a major problem in many developing countries. In many cases, most notably Southeast Asia in the 1990's, credit and credit markets were central to creation and demise of economic bubbles.

The dynamics are very simple: people borrow money (against promises of giving back their future income); and in a low interest rate environment (low compared to the inflation rate) people will borrow recklessly. This reckless barrowing increases the short-term welfare of the society, and more importantly increases the price of many long term assets, enabling and encouraging people to borrow and spend more. But, eventually households have to repay their debt and more often than not, they end up selling or at least trying to sell some of their assets to settle their debt. Often it is the case that many households try to sell their assets at the same time, which depresses asset prices and results in a bubble burst in the overall economy.

One can make a case for such an asset price bubble in Iran. Anecdotal evidence from Iran indicates that the real estate market in Tehran is significantly over priced ($4,000/sqaure meter in certain areas means that a home will cost about $1 Million, very comparable to the high end housing market in the US, while the per capita GDP of Iran is much lower). Also, automobile prices (which are considered an investment in Iran) are well above international levels. Furthermore, Iranians are able to borrow money fairly easily and through means that are not available in many other countries: they can use their checking accounts to obtain credit by use of post-dated checks or "Check-e-Tarikhdar;" a check that can only be cashed after a certain date. As I will explain later, these checks enable people to obtain easy credit at dangerously high levels.

All over the place, there are signs that many assets in Iran are over priced and that people are spending beyond their means; very much like Asian economies in mid 1990’s. Moreover, the government is maintaining a fixed exchange rate that creates structural inefficiencies in the economy and further encourages reckless spending (again similar to Asian Countries in the 1990's).

If the above diagnosis is correct (a more rigorous study of major economic indices is required to use a more certain tone), the outlook for the Iranian economy is very gloomy. Eventually, credit will dry up and foreign exchange reserves will diminish (as the crisis in Latin America, Asia, Mexico, Russia, and many other places have shown). The result will be depreciation of the real estate and other assets (an asset bubble burst), increase of inflationary pressures, and a currency meltdown.

The basic rule of macroeconomics is very clear: you cannot borrow and spend beyond your means indefinitely.

Unfortunately, there are many factors that increase the risks and potential severity of a credit crisis in Iran. Here are a few:

1- Ideological issues that the clerics have with interest rate: Khomeini, in a statement that shows his backwards attitude toward sound policymaking, once said "economics belongs to donkeys." Many clerics and wannabe clerics (like Basij and Sepah) have a firm belief that interest rates are against the wish of god. This prevents the government from having a sound monetary policy and controlling the credit markets; indeed it is hard to understand if the government is actually feeling responsible for making economic policy.

2- Since most of the economy is controlled by the governments, many banks are involved in directed lending. Directed lending is the practice of governments forcing banks to lend money at low interest rates to high-risk customers. Directed lending results in non-performing loans and eventual balance sheet loss for banks, but banks are obliged to do it anyway because of political reasons. Directed loans where very costly for countries like South Korea and China. The Chinese government recently had to spend $45 Billion to compensate the negative effects of directed lending by two of its largest banks.

3- There exists no system for maintaining credit controls: As Kaveh Khojasteh mentioned is his recent entry, credit in Iran is based on face to face "trust." In economies Western use of credit markets and credit instruments (like credit cards and mortgage loans) is quite common and increases the market efficiency and the overall health of the economy. However the Iranian credit system is different from lines of credit in three regards:

A. First, there is no central system for keeping track of credit history of people in Iran. It is fairly easy for people with negative records to get a checking account and use dated checks. But for example, in the US when people apply for credit cards or any credit product, they undergo a thorough investigation on how they have used credit before and a decision is made based on their “credit score”. Of course, there are also organizations that perform credit analysis for corporations (Moody’s, S&P, and Fitch).

B. Second, there are no nominal limits on the amount of credit in the most common Iranian credit system, the dated checking system. Account holders can write a dated check as high as they want and there is no way that the bank can estimate or limit the total amount of checks outstanding for a customer. So people with bad credit are essentially able to use large amount of credit.

C. Third, in the Iranian system, mainly due to lack of credit history, people pay the same interest rate regardless of their credit history. In case of dated checks, people are basically paying zero interest rates. In the Western system, higher interest rates are applied to people with high credit risk as a deterrent against having a bad credit history. However, in Iran high risk people have access to the same levels of interest rates as low risk people, which creates incentives for reckless borrowing.

4- Because of the above mentioned lack of transparency in the Iranian banking system; there are no mechanisms to measure the total amount of consumer debt outstanding in Iran. For example, no one knows for sure the amount of dated checks outstanding as of now because there is now method for banks to know how much their customers have issued checks. This situation can never happen in a credit card system. Therefore, the policy makers and researches, along with potential international lenders, are kept in the dark about the severity of the consumer debt bubble in Iran.

5- Many organizations, outside the official banking system, are in the business of borrowing and lending money. The most dramatic examples are a form of drift funds known as “Sandough-e-Gharzolhaseneh.” The official banking system is trying to crackdown on these unregulated thrifts but since the thrift funds have strong connections to certain political groups, chances of a regulatory intervention is very low. Since these thrifts are unregulated, they have a propensity to take high levels of risk through speculation on real estate markets, and as the history has shown, they also engage in fraudulent activities. There are no official statistics about the amount of assets controlled by these thrift funds.

*****

Based on the above considerations, the consequences of a potential credit meltdown in Iran are hard to predict; but unless a bailout by IMF or World Bank does not happen, it is very difficult to maintain a positive outlook about the Iranian economy.

* This entry was motivated by the previous entry by Kaveh Khojasteh

January 12, 2004

Reform Project: 1997-2004
Kaveh Khodjasteh  [info|posts]

vote.jpgIt is becoming clear now, very clear. Iran's most democratic government in the last 50 years[1] is going down the drain. Could anyone have found a funnier caricature of democracy in the modern world?

What makes Iran so unique in this respect is the juxtaposition of hope, apathy, diplomatic activism, internal unrest, conflicts in the region, economic waves of oil price fluctuation, a tragic earthquake out of nowhere and a sad but skilled display of power by the organic parts of the Iranian government. The recent mass-rejection of the parliament candidates[2], of which many of the current members have been a victim, might be the coup de grace for the dreams of a young and ever-hopeful generation of Iranians who besides being genuinely patriotic, were also subject to an idealism that finally proved unworthy of realization. The next thing will probably be mass rejection of voters based on their looks, sex, ethnicity, religion or whatever they seem to be unfit.

I dare to compare the outcome of this mass-rejection of candidates, to the bombardment of the Iranian parliament less than a 100 years ago, by the Russian Cossacks Brigade under the command of the ruling despot, Mohammad-e-Ghajar, who simply did not like the idea of people having a part in the conception of their destiny. The overwhelming public uprising against the king at that time, coordinated by the educated Iranian elite (with known connections to the British, at that time a rival of the Russians in meddling in the Iranian affairs) led to finalizing of the Constitutional Revolution that made Iran, at least in theory, along with Turkey, one of the first democracies in the Middle East. Unfortunately that will not be repeated. To borrow from a recent conversation with Eswin, the popular support for the Constitutional Revolution came from the long years of famine and hardship in the "Protected States of Iran"[3], that had brought many people on the edge of their existence, so that they would give anything for a change.

Now the situation is not so dire for Iranians. Before the Earthquake came, the middle class residents of the big cities were enjoying a transparent dream of prosperity and economic growth. To them, health care seems to be cheap and convenient[4], the poor and the elderly are supposedly taken care of by the Islamic charity foundations and there are excellent private schools and universities[5] for their kids to follow the path to greatness. There is virtually no tax to be paid unless you work for the government and the credit system in the mercantilistic economy is based only on "trust." So eat as much as you can and don't worry: there is always more. [All said in this paragraph is the alleged dream of the majority of the middle class Iranians in big cities! Sorry for overemphasis!]

The Bam earthquake, for some, was a wake up call. Does the house that many have built themselves under the freshly blended mix of tradition and Modernity, withstand a political earthquake, and its aftershocks? Is there a hope for what shall remain of the Iranian civilization, one of the oldest still claiming to exist?

Notes:
[0] I have already talked about these things but well, have your say too!
[1] Relatively, loosely, hopefully and sadly speaking.
[2] Google News Compilation. Also mentioned here and here.
[3] Official Name of Iran at the time, now Islamic Republic of Iran.
[4] It is indeed cheaper than many places in Europe and even Canada. Whoman also has other intersting posts, touching and also about this subject.
[5] Education is free in Iran, even higher education, but you will have to work in Iran for twice as long as the duration of your studies or pay a certain equivalent afterwards to release your degree.

Update: Well, have a look at these photos from the South of Tehran and these from a university residence.

January 09, 2004

 Life 
Fathers and Sons
Ali Mostashari  [info|posts]

choices.jpg No, this is not a critique of the book by Turgenev. This is a piece about choices. Choices that one makes in one's life. You see, in 1969, less than 24 hours after graduating with his Ph.D. in Chemistry, my father returned to Iran from the U.S. to help change Iran into a "modern" country. Strongly opposed to the Pahlavi regime, he met many obstacles in his goal, but kept going nevertheless. He helped establish Chemical industries, taught probably over a thousand undergraduate or graduate students, many of whom are University professor themselves. Then came the revolution.

Like many other intellectuals he heralded the new era as one of change. Today Iran in ruins, tomorrow the Sweden of the Middle East; well maybe not naive, but close. Anyway, the revolution took place, and two years later the cultural revolution came about and he was expelled from the University again by the new regime—ironically by Dr. Abdolkarim Soroush's committee—and was forced to leave the country (due to political persecution) to teach at a university in Germany. Long story short, he couldn't bear being in Germany, came back to Iran and barred from teaching at the University or working in any government research center, he started providing know-how for private chemical industries. Since his return in 1987 he has succeeded in implementing chemical and pharmaceutical industries that have reduced Iran's dependence on foreign imports by more than $45 million, while he was not successful at implementing $1.2 billion worth of know-how that he has produced, due to the corruptness of the government. Always cursing the Iranian government with vulgarities that I do not dare repeat here, he stays there, works and does research 14-16 hours a day with an efficiency of 0.5% compared to the energy he puts into things and is having the time of his life. Still Iran is not Sweden, not even close to Turkey in terms of industrialization. In fact I can say that based on my academic studies, with the current governance structure in Iran things are going to get much worse. Don't get me wrong, in my opinion any other government in Iran will probably not do much better, until real cultural, social and political development evolves from the grassroots. If anyone promises a better Iran in 5 years after they seize power, don't believe them. Anyway, I asked my father: "So why do you do what you do when it is but a drop in an ocean?". He said: " What else can I do? We haven't had democracy for 2500 years, so I can't afford to wait for one before I help them. If you stay in the U.S., nothing is going to change in this country. This is my country. I am doing this for my people."

Well it is my country too. So here I am, a year way from the time to make choices. Roshanak, my wife, who is a Ph.D. candidate of Space Systems Engineering at MIT, has no desire to return to Iran under the current situation. I can't blame her: if I were a woman, I wouldn't either. But do I personally wish to go and serve my country, even if I don't really like the governance structure? The answer is: "I don't know". Sometimes I wish I would go, other times I think it would be senseless. My work in the Iranian Studies Group (ISG) has kept me motivated. I feel that I am being positive, doing something for my country. Still, there is an empty feeling sometimes. Do I become a faculty member in a University, get a tenure, become an Associate Professor and then a Full Professor, publish useless articles, and die? Do I become a consultant at McKinsey, make $180K a year after 5 years and buy a 120" projector TV? Do I keep my conscience at ease by donating $100 to earthquake victims for the next earthquake? Do I release the 100th issue of the Iran Analysis Quarterly? Do I sit down with all the other ISG members and initiate projects on Iran that have no effect?
I may but the prospect is not enticing. Nor is the prospect of going back to Iran at this point. Given that I have the expertise (takhassos), but not the loyalty to the regime (ta'ahod) to be able to teach at the Univerity, where I would have to observe 200 red lines not to be crossed in class, what could I do? Open a business in Iran and do management consulting? Offer designs of strategic systems management for Iranian industries that end up in the trash bin? Start an import/export company? Or privately tutor for TOEFL and GRE so that other graduate students can come to the U.S. to study and face the same challenge? How would that help my country?

The old generation definitely had it easy with their idealism... .

January 08, 2004

Earthquakes in Iran: A Geological Perspective
Guest Auhtor: Jahandar Ramezani

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The Bam earthquake of December 26, 2003 with a magnitude of 6.6 Richter is one of several deadly tremors that have repeatedly struck Iran's towns and villages throughout its modern and ancient history. Understanding the geologic forces behind this tremendous natural hazard is of fundamental importance to any risk assessment or loss prevention efforts in the region.

Geological Setting of Iran

Earthquakes in Iran and neighbouring regions (e.g., Turkey and Afghanistan) are closely connected to their position within the geologically active Alpine-Himalayan belt (Fig. 1). But, what causes all that geologic activity? In general, the rigid outer shell of the solid Earth is a mosaic of interlocked slabs—known as tectonic plates&mdash that are constantly moving against each in response to Earth’s powerful internal forces. The great majority of earthquakes in the Earth’s crust occur along faults (ruptures in rocks) at or near the plate boundaries. In the Middle East region, modern tectonic activity is forced by the convergent movements between two plates: the Arabian plate, including Saudi Arabia, Persian Gulf and the Zagros Ranges of Iran, and the Eurasian plate that incorporates Europe, central and East Asia, as well as the interior Iran (Fig. 1 and 2). The Zagros Thrust Zone (red line in Fig. 2) constitutes the boundary between the two colliding plates.

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Figure 2. The simplified structural map of Central-East Iran showing the location of major faults. Red line represents the boundary between Arabian and Eurasian plates. Large arrows indicate the direction of plate motion. Compiled from Berberian, 1981; Jackson and McKenzie, 1984; Haghipour and Aghanabati, 1989; Alavi, 1991. AZF = Abiz Fault, DRF = Doruneh Fault, GWF = Gowk Fault, KBF = Kuhbanan Fault, KMF = Kalmard Fault, MAF = Mehdiabad Fault, NAF = Nostratabad Fault, NHF = Nehbandan Fault, NNF = Na'in Fault, RJF = Rafsanjan Fault, SBF = Shahre-Babak Fault, ZRF = Zarand Fault, ZTZ = Zagros Thrust Zone.

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Figure 1. The Alpine-Himalayan Belt. Image from Cornell University/INSTOC.

Much of the mechanical deformation resulting from Arabia-Eurasia collision is accommodated by the Zagros Ranges in the form of folding of rocks and the rise of mountains in conjunction with fault movements at depth of the Earth. In fact, the highest frequency of earthquakes in Iran occurs in the Zagros region (Fig. 3). However, because of the diffuse nature of this deformation (i.e. simultaneous movements along a number of sub-parallel faults over a wide area) the intensities of these tremors are generally low and are recordable only by sensitive seismic devices. The interior parts of Iran, however, respond to the plate collisional forces in a different manner. In the area known as Central-East Iran deformation takes place largely in the form of strike-slip (sideway) movements focused along a complex array of intersecting faults (Fig. 2). In sharp contrast to that in Zagros, seismic activity associated with central Iranian faults is sporadic but much more localized and occurs with significantly higher magnitudes. Many of Iran's powerful tremors, such as the recent Bam earthquake, have occurred in this area. By and large similar mechanisms are responsible for large magnitude earthquakes in other parts of the country, such as Zanjan and Azerbaijan, not shown here. Figure 2 illustrates major fault structures of the Central-East Iranian region along with large centers of population in their vicinity. The locations of three largest earthquakes of the modern times are also indicated by red circular symbols. These are the Ferdows earthquake of August 31, 1968 (Magnitude = 7.3, 12,000 – 20,000 deaths), Tabas earthquake of September 16, 1978 (M = 7.8, more than 1,500 deaths), and the recent Bam earthquake (M = 6.6, more than 30,000 deaths).

Scientific Research and Earthquake Risk Assessment

Earthquake damage prevention requires organized nationwide planning and that in turn relies on successful identification of high-risk areas. Most faults, as zones of mechanical weakness prone to seismic rupture, can be located on the ground by means of geological field investigations aided by aerial or satellite imagery. However, not all faults are seismically active and not all active faults produce large magnitude earthquakes. Data collected by networks of seismic stations, both locally and globally, provide valuable information regarding the overall geologic structure of areas of high seismic activity. In addition, the geophysical analysis of seismic waves received at such stations reveals not only the timing and magnitude of earthquakes, but the sense of movement on the corresponding fault structures, as well. Through compilations of time-integrated geological and seismological information, areas of high earthquake risk can be identified.

Important advancements in the study of earthquakes have been brought forward by the more recent development of space-based Global Positioning System (GPS) technology. By simultaneous analysis of radio signals received from multiple satellites orbiting the Earth, GPS stations (Fig. 4) can pinpoint the precise geographic coordinates and elevation of any spot on the ground within fractions of a centimeter. Monitoring small Earth movements (indicated by shifts in the location of GPS stations) over extended periods of time reveals areas of strain build up along faults and helps to predict the location, style and size of potential earthquakes. A remarkable advantage of the GPS method is its ability in constraining deformation during seismically quiet motions before and after earthquakes. In places such as central Iran where ground deformation occurs through complex interactions among several fault systems, sophisticated computer models need to be employed in conjunction with both ground-based and GPS data for earthquake prediction and seismic risk assessment.

Jahan Ramezani is currently a research scientist in the Department of Earth, Atmospheric and Planetary Sciences of Massachusetts Institute of Technology.
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Figure 3. Record of seismicity in southeastern Iran from 1990 to 2003. Location of the December 26, 2003 Bam earthquake is marked by a star. From USGS National Earthquake Information Center.

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Figure 4. A Global Positioning System (GPS) station equipped with solar batteries in Nevada. Courtesy of Brian Wernicke, California Institute of Technology.

References

Alavi, M., 1991, Tectonic map of the Middle East: Tehran, Geological Survey of Iran, scale 1:5,000,000.

Berberian, M., 1981, Active faulting and tectonics of Iran, in Gupta, H.K., and Delany, F.M., editors, Zagros-Hindu Kush-Himalaya Geodynamic Evolution: American Geophysical Union Geodynamic Series, v. 3, p. 33-69.

Haghipour, A. and Aghanabati, A., 1989, Geological Map of Iran (2nd edition): Tehran, Geological Survey of Iran, scale 1:2,500,000.

Jackson, J. and McKenzie, D., 1984, Active tectonics of the Alpine-Himalayan Belt between western Turkey and Pakistan: Geophysical Journal of the Royal Astronomical Society, v. 77, p. 185-264.

January 05, 2004

Scientific Isolation
Mohammad Hafezi  [info|posts]

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It is almost a year since the University of Pierre and Marie Curie (Paris VI) launched a mobilization against renovation of the scientific accord between the European Union and Israel due to violations of the human rights and occupation of the Palestinian territory. The Administration council of the university in a motion pronounced their concern about the continuation of the scientific relations with Israeli universities and in a letter they asked the scientific colleagues especially in Israel to exert pressure on their government to make scientific life possible in Palestine. They also insisted that since the second article of the Israeli-EU accord, regarding respect of human right in internal and international politics, has been violated, there would not be any reason to renovate the accord.

That motion received great positive and negative impacts inside and outside of France. There were basically two type of arguments: (a) although the government has not respected the human rights, one should not judge or punish the scientific society. The scientific research goes beyond the borderlines of the countries and is based on equal opportunity; everybody around the world should be able to interact and not be boycotted because of some political orientation of his/her country.[1] (b) On the other hand, the supporters claimed that the text has been misinterpreted and indeed to keep the science available to everybody disregarding his/her citizenship one should not let the Israeli government to put the Palestine in a turmoil where no school or university can work; therefore the accord should be suspended –as indeed the European Parliament voted on April 2002- until the Israeli government respects all the requirements of the Oslo accord.

Now let us shift to another story which happened for another country in the Middle East. IEEE, the world’s largest scientific society on computing, electronic and electrical engineering, in January 2002, cut its full membership privileges and supports including using the IEEE logo and blocked access of all email accounts of the Iranian members on IEEE.org without any notice. The Iranian members were also deprived from publishing their paper in IEEE journals.

The ostensible reason was that the U.S. Office of Foreign Assets Control (OFAC) regulations prohibit the American organizations to trade or offer any service to Iran and since "editing" is a service in publishing a journal, IEEE refused to accept any paper from Iran. A lot of efforts were made especially by Ferydun Hojabri, president of the Sharif University of Technology Association, to at least clarify IEEE decision and force IEEE to respond on this action which effectively isolated 1700 IEEE members in Iran. Then imagine what happened? IEEE requested clarification from OFAC, and the U.S. Department of Treasury announced that the U.S. based scientific journals cannot edit any paper coming from Iran unless they have government’s permission.

This is how science sometimes becomes the scapegoat of the antagonistic politics.

[1] This kind of argument reached to a point where Prof. Cohen-Tanoujdji, Nobel laureate, on a letter in Le Monde announced that he is "ashamed" of his French colleagues who took that decision in University Paris VI. ( Le Monde January 5, 2003)

[2,3] Science 2003 September 19; vol. 301:page 1646 and Science 2003 October 10; vol. 302: page 210