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Generational Dynamics Web Log for 9-Dec-2009
Iran fails to smash student protests, as the Dubai crisis batters its economy

Web Log - December, 2009

Iran fails to smash student protests, as the Dubai crisis batters its economy

Huge peaceful student protests in cities across Iran were met with violence on Monday, as police and tens of thousands of Basij militia used teargas, beatings and arrests in a fruitless effort to stop the protests. There were also unconfirmed reports of gunfire.

Iran's government had partially shut down internet and mobile phone connections on Monday, but videos of the clashes were posted anyway to YouTube, Twitter and opposition Web sites.

Ironically, December 7 has been the day when anti-American rallies have been held in the past, commemorating the deaths of three students during an anti-government protest in 1953, protesting Iran's pro-American policies at that time. What all of these protests have in common is that they're targeted against the Iranian government of the day.

These continuing anti-government student protests are typical manifestations of the "generation gap" that takes place in any country's generational Awakening era. This generation gap occurs between the generations that survive a generational Crisis war (in this case, the 1979 Islamic Revolution and the Iran/Iraq war) and the generations that grow up after the war ends. (See "Theological split in Iran widens as opposition protests continue.")

Dubai financial crisis affects Iran

The recent financial meltdown in the Dubai emirate of the United Arab Emirates (U.A.E.) comes at the worst possible time for Iran's President Mahmoud Ahmadinejad, and for the hardline Iran government. Just as Iran's government is facing its greatest internal domestic threat from student protests, the Dubai crisis threatens Iran's economy and its external import/export regime.

Iran is heavily invested in Dubai, and it appears that Iran has purchased 30% (tens of billions of dollars) of Dubai's real estate currently in financial distress. Dubai's real estate values have already fallen 50% since January, and so Iran is poised to suffer large, significant losses.

Even more important to Iran is Dubai's strategic importance. Iran has been under trade sanctions first imposed by President Bill Clinton's administration in 1996, and later increased in President George Bush's administration and by the United Nations. In the past couple of months, Iran has really been sticking it to the international community by announcing aggressive new nuclear development programs, with the result that, led by President Obama's administration, the UN is considering even greater sanctions.

Dubai has served Iran by providing a conduit by which Iran could bypass the sanctions. Dubai is a major exporter to Iran and a major re-exporter of Iranian goods. The trade between Iran and Dubai is one of the principal sources of Tehran's confidence that it can survive US-led sanctions.

Iran has been receiving high-tech equipment for its missile and nuclear programs via Dubai, and most of Iran's gasoline imports also come via bunkering facilities in Dubai, according to the Washington Institute for Near East Policy.

Unlike its neighbor Abu Dhabi, Dubai has little oil revenue, and has sought to generate income through ultra-extravagent real estate development and credit abuse that exceeds even the West in debauchery and depravity. They got away with building up some $100 billion in debt because investors have always assumed that Abu Dhabi would continue to bail out Dubai whenever necessary.

However, Abu Dhabi is allied with Saudi Arabia and the West, and is apparently going to hold back any bailout of Dubai unless Dubai stops allowing Iran to bypass the trade sanctions. According to reporting by Debka, Abu Dhabi will provide $50 billion in bailout money in return for control of Dubai's ports and the imposition of strict fiscal and monetary laws and regulations.

Thus, the Dubai financial crisis has the potential to cause some significant power shifts in the Persian Gulf region, especially with respect to the escalating power struggle between Iran and Saudi Arabia. (See October article, "Furious Iran blames Pakistan, US and Britain for Sunday's terrorist attacks," and September article, "Escalating civil war in Yemen threatens to pull in Iran, Saudi Arabia and U.S."

A dangerous wild card

Tehran has been riding high for a few years. Suddenly, in the space of a few months, Tehran is being backed into a corner. The student protests are a serious existential threat to Iran's hardline government -- something that couldn't even be imagined before June.

And now, in the last month, with the government under domestic attack, the Dubai crisis has dramatically weakened Iran internationally and financially.

As I've said in the past, Iran is a very dangerous wild card in international politics. Ahmadinejad has plans to gain hegemony over the entire Mideast, including the Arabian peninsula. To that end, he's been funding Hizbollah in Lebanon, and terrorist Palestinian groups, including Hamas, and the Houthi rebels in Yemen.

The Tehran government may be getting increasingly desperate, like a trapped animal. We've already seen how they've jailed and slaughtered their own students for peaceful protests, perpetrating violence that's gone considerably farther than I had expected. Still, the student protests seem only to be growing, as would be expected in a generational Awakening era.

The real danger is that Tehran will now desperately strike out internationally in some way. For example, they might carry out their oft-repeated threats to use mines and missiles to block the Strait of Hormuz, causing an international oil crisis.

One possible sign of this is a recent rant by Mahmoud Ahmadinejad in a speech last week. The Iranian President accused America and the West of devising plans to prevent the coming of the Hidden Imam. (See "Theological split in Iran widens as opposition protests continue.")

Ahmadinejad's bizarre rant may be a sign that he's cracking up, or it may be a sign that he's laying the groundwork for some kind of religious justification for creating a new crisis.

One thing seems pretty certain -- that Iran's government in its current form cannot survive against this growing internal political opposition. A civil war something like the 1979 Islamic Revolution is, of course, impossible during a generational Awakening era, but the level of political and generational conflict will increase for years.

And as I've said many times (see, for example, "China 'betrays' Iran, as internal problems in both countries mount"), when all is said and done, I expect Iran to be on the side of America and the West, including Israel, when forced to make a choice in the coming Clash of Civilizations world war. It's possible that Iran is close to the next major step in that scenario.

(Comments: For reader comments, questions and discussion, see the Iran thread of the Generational Dynamics forum.) (9-Dec-2009) Permanent Link
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