What a Revolution! Thirty Years of Social Class Reshuffling in Iran

The 1979 revolution in Iran overturned the existing political order. It ruptured the existing social relations and institutions to reconstruct them in a new mold. It was an idealized expression for social change and progress. Its slogans, deliberate or spontaneous, were epitomes of the expected orientation of the revolutionary movement by the mass of its participants and its leaders. Yet a revolution, like a forest fire or a tornado, once it takes shape, its form, direction, and extent have more to do with the internal dynamics of the interaction of its forceful momentum with the social landscape in which it traverses than with its origin or initial orientation. Such is the story of the Iranian revolution, seeking to establish the rule of the oppressed; to eradicate poverty, exploitation, and “excessive” wealth; to do away with “imperialism of East and West”; and to replace Iran’s “dependent capitalism” with a hitherto undefined utopian Islamic economic order, under a petty-bourgeois-oriented Shi’i clergy, in the deeply polarized Iranian society.

Soon after the revolutionary surge, the Islamic government nationalized large manufacturing and financial enterprises. Revolutionary Islamic courts confiscated the property of those who were found “corrupt on earth.” Land-hungry peasants took over rural land. The urban poor occupied vacant apartments, and workers’ councils captured control of many enterprises. Owners of capital and property rushed to liquidify and ran for cover in the safe havens of foreign banks and currencies.

The state was entangled in its internal dispute over the orientation of the postrevolutionary reconstruction. The definition and establishment of a new “Islamic economic order” became the subject of an intense political struggle among contending social forces and within the state.¹ The Iranian economy was entrapped in an economic crisis of the postrevolutionary type² — that is, a crisis in the production process resulting from the postrevolutionary political upheaval — and the open social contestation in choosing the path of postrevolutionary reconstruction. A postrevolutionary economic crisis will end when the transition toward a new social order (or the return to the disrupted order) reaches a steady state. In Iran, the absence of a clear revolutionary program with a definition of the economic order that was expected to replace what existed and was disrupted prolonged the crisis. The war with Iraq, the international economic sanctions, and the oil price collapse in 1985 and 1986 only accentuated the economic crisis.

We conceptualize the transient postrevolutionary period into two distinct periods with distinctly different characteristics. First is the retrenching of capital in response to the overwhelming expression of antagonism toward the existing economic order, in the course of the revolutionary upheaval and the postrevolutionary turmoil. This resulted in a shriveling of capitalist relations of production and an elaboration of the maze of entangled market networks, conducive to the growth of petty-commodity production. We call this degenerative process “structural involution,” which is characterized by widespread disruptions in production and capital accumulation (investment), resulting in de-proletarianization of the urban economy, peasantization of agriculture, and a significant increase in small-scale service activities. We adopt the term involution in the sense introduced by the cultural anthropologist Alexander Goldenweiser in 1936, to mean a “progressive complication” of the existing pattern without evolving into another.³ Clifford Geertz extended Goldenweiser’s notion of involution to explain the process of agricultural development in Java in the nineteenth century.⁴

The reversal of the involutionary trend, in a move toward economic restructuring and liberalization, may be noted as a “de-involutionary process.” This reversal trend is characterized by revitalization of capitalist relations of production, reconstitution of market institutions, proletarianization of the workforce, and de-peasantization of the rural economy.

We have examined the involutionary and de-involutionary trends in the Iranian economy elsewhere.⁵ An econometric study of the “sources of growth and stagnation” of the Iranian economy in this period by Farshid Mojaverhosseini shows similar results in terms of the growth performance of the economy.⁶ Table 1 reveals the sharp decline in the contribution of capital stock to the growth of the non-oil real gross...