UNDERSTANDING THE MIDDLE EAST:
History, Religion, and the Clash of Cultures
400 pages
Copyright © 2007 by Beechmont Crest Publishing
First edition, 2007
0-9748330-6-1
C H A P T E R 7:
Iran: the Islamic Republic
Iran, Britain, and Russia
The Safavid Dynasty was swept away in 1795, when a Turkic group called the Qajars took control of Iran. The Qajars inherited an economically weak country. Moreover, the long decline of the Safavids had debilitated the central government.
Despite these unfavorable internal conditions, the Qajars had imperial ambitions. Persia fought a war with Russia in 1804 over Georgia. The czar’s troops defeated the Persians; and the subsequent treaty transferred existing Persian territory in the Caucasus to Russia.
Great Britain and Russia were perennial rivals throughout the nineteenth century. (The two nations would go to war in the Crimea before the century’s end.) Persia’s rulers were eager to exploit this rivalry by leveraging Great Britain against Russia. Ten years after Russia pummeled Persia over Georgia, Britain and the Shah of Iran signed the Definitive Treaty of 1814. Under the terms of the treaty, Britain was permitted to maintain troops in Iran; and it was the only European nation to be given this right. The treaty also included provisions for British officers to train Persian troops.
The shah waited scarcely more than a decade to test the new alliance. Persia declared war on Russia in 1826 in the hope of regaining the lost territories of the Caucasus. But Great Britain was now temporarily allied with Russia in the Greek War of Independence. No British troops came to the shah’s aid. The result was another horrible defeat for Persia. The Treaty of Turkmanchai (1828) reaffirmed Persia’s earlier land losses in the Caucasus. Persia was also forced to pay war reparations to the czar.
The Qajar rulers of Iran faced more economic problems as the nineteenth century progressed. The Industrial Revolution brought efficient mass production methods to the factories of Europe. Iran’s household-based, craft industries could not compete. Middle class artisans saw their livelihoods swept away as cheap foreign goods flooded the markets of the country.
The national currency was also assaulted by worldwide economic trends. The Persian dinar was based on silver; and silver prices declined in the 1800s. Then, as now, a drop in the value of a nation’s currency had disastrous effects. Inflation spiraled out of control, reaching levels of 500 – 600% during the mid-1800s.
These externally imposed difficulties would have been damaging enough by themselves. Unfortunately, the Persian government implemented a number of policies that only exacerbated the country’s economic woes. Rather than tax foreign imports, the shahs taxed domestically produced goods. This further crippled the artisans. Nor were there other tax cuts; all taxes remained high to pay for the lifestyles of the ruling elite---which included luxury goods and frequent trips to Europe.
In 1872 the shah took a desperate step to turn the economy around. Believing that Western expertise was necessary, he turned over control of practically every aspect of the Persian economy to Baron Julius von Reuter (a British citizen). This move backfired horribly: Reuter pushed through more regulations that benefited British industries at the expense of Persian competitors. Middle-class Persians also perceived the so-called Reuter Concession as a source of national humiliation. The shah finally rescinded the arrangement.
In the 1880s the shah made a similar concession to British tobacco interests. The Imperial Tobacco Corporation was given a monopoly over the Persian tobacco market. The monopoly affected nearly everyone in the production, sale, and consumption chain. Domestic producers of tobacco had to sell their tobacco at low prices dictated by the British monopoly. Merchants’ profits were also trimmed, as Imperial Tobacco boosted its own margins. Finally, consumers were harmed, as retail tobacco prices rose in the absence of a competitive market.
The disturbances that followed came to be known as the Tobacco Revolt of 1891. There were nationwide protests, and officials of the Imperial Tobacco Corporation were attacked by angry Iranians. The Tobacco Revolt reached its climax when Iranians boycotted tobacco completely. The shah reluctantly cancelled the monopoly. But this reversal carried a hefty price: a half a million pounds in compensatory damages paid to Imperial Tobacco. It was an expense that the Persian treasury could ill afford.
In a development that presaged the Islamic Revolution of 1979, Iranian clerics became the main instigators of the Tobacco Revolt. The clerics had two motives. First of all, many were dependent on the middle class for financial support. Secondly, where there were foreign corporations, Western secular culture could not be far behind. The clerics issued a series of fatwas (religious commands) against foreigners, foreign companies, and the use of any product sold by Imperial Tobacco. A potent mix of religious, economic, and political forces drove the Tobacco Revolt.
Copyright 2005 Beechmont Crest Publishing
