The accelerating pace of liquidity growth and money-printing in Iran in exacerbating the misery and hardship for the oppressed people of Iran, to see how many millions of Iranians are driven below the poverty and survival line. In the three years of Ebrahim Raisi’s presidency, the Central Bank of Iran imposed a massive inflation and liquidity on the distressed people of Iran.
Khamenei’s appointment of Raisi as the head of the executive branch in 2021 angered the so-called reformist faction, who had repeatedly expressed their loyalty to the Supreme Leader. Therefore, their candidate, Abolnasser Hemmati, the Central Bank president, showcased his knowledge and expertise during the presidential campaign and after, contrasting with that of Raisi, who was notoriously renowned for having only elementary education. Regarding Raisi’s claims about inflation and liquidity rates, Hemmati said on May 6, 2024: “In the past two and a half years, the government has printed 6 quadrillion rials, meaning the monetary base has increased by 115% in 30 months; whereas from the time of Cyaxares (an ancient Median king) until September 2021, the total amount was 5.19 quadrillion rials.”
Hemmati added that with 35 billion dollars in oil revenue, registering an inflation rate of 48 to 50 percent in 2023 is unacceptable, and the government cannot pretend to fight inflation but must answer for the shrinking of people’s purchasing power and the devaluation of the rial.
Cyaxares was the third king of the Median Empire, 625 years before Christ. However, 21st-century economists in Iran have long been trying to expose the tricks of the clerical regime, which prints money and creates inflation through the Central Bank, effectively taking money out of people’s pockets. This method is common among the ruling governments in Iran, who insist they do not print too much money, but their statistics are manipulated and fake, and their money-printing machines run around the clock. Conversely, the state media (IRNA) supporting Raisi’s government claimed that Hemmati was wrong and that the monetary base and inflation have decreased significantly. Furthermore, the current growth of the monetary base is not a cause for concern.
However, experts outside the ruling factions show that all of these officials, under Khamenei’s command, have relentlessly accelerated the money-printing machine during their tenure. The monetary base refers to all the banknotes and coins produced and credits approved by the Central Bank, and its growth has a direct effect on the inflation rate.
Hemmati’s claim about the amount of money printed is correct. During the two and a half years of Raisi’s government, the monetary base has more than doubled, but this unprecedented growth is not new. On May 8, 2024, Factnameh website wrote, “During Hemmati’s two years and ten months as Central Bank president, the monetary base also more than doubled. The monetary base in July 2018 was about 2.2 quadrillion rials, and by July 2021, it had reached about 4.93 quadrillion rials. There is no doubt about the high growth rate of the monetary base during Ebrahim Raisi’s government, but emphasizing the increase in the monetary base without mentioning that the growth rate has not changed from before is misleading.”
Nevertheless, the increase of 3.01 quadrillion rials in the monetary base is the very calamity that Raisi brought upon the suffering people of Iran.
Now let’s see where all this money and oil revenues go and how they are spent. The issue is the disaster of Raisi’s government’s “extra-budgetary” spending, which has left no room for proper budgeting. Farshad Momeni, an economics professor, says: “We are facing an increasing and catastrophic crisis of extra-budgetary figures that eliminate transparency and evaluability. For example, 1.37 quadrillion rials of crude oil and condensates are at the disposal of individuals to provide resources for the General Staff of the Armed Forces and numerous other cases amounting to over 10 quadrillion rials” (Ham Mihan, May 19, 2024).
He says that in the budget prepared for 2024, instead of reducing poverty and improving the quality of life of the people, the opposite path has been considered.
It is no wonder that the death of the Executioner of 1988 brings such joy to the impoverished people. According to Farshad Momeni, despite all this money printing and crude oil sales, the total visible and hidden deficits of the 2024 budget bill are such that we should cry thousands of trillions of times for this mega-entity (the government). It seems that this budget has been designed with anti-development goals to increase poverty, inequality, and dependency, and to exacerbate the country’s backwardness compared to its neighbors and the rest of the world.
Although the money-printing machine stopped working for a few minutes with the news of Raisi’s death, by Khamenei’s order, the wheel of suppression and plunder of the Iranian nation continued. Millions of poor and hopeless young people see their dreams shattered, but with the death of a ruthless executioner, a bit of the grief and sorrow of thousands of bereaved mothers was alleviated until the day when the apparatus of oppressors and looters is dismantled by the rebellious youth.