Iran's Regime Teeters on the Brink as Economic Woes and Foreign Threats Unite Protesters

Iran is experiencing its most widespread unrest since 2022, but unlike previous protests, the current demonstrations diverge from the traditional pattern. This time, the regime's economic collapse, war, and environmental crisis are in full view, with no solutions from the leaders. The protests have drawn on anger from a constituency the regime once regarded as its own: jobless young men. The state has no answer to their demands. The protests started with a strike by electronics vendors in Tehran, who were unable to buy and sell imported goods due to the freefalling currency. Other businesses joined the walkout, including shops in the grand bazaar, a weathervane of politics. The protests have spread to other cities, but most demonstrations draw just a few hundred people. The regime looks more rattled than expected, deploying riot police, water cannons, and plain-clothes goons to disperse protesters. Schools and universities have been closed on the pretext of air pollution, a tactic to forestall mass action. However, the use of repression is backfiring, with footage of security forces raiding hospitals to arrest wounded protesters enraging the public. The latest protests have also seen the emergence of an unlikely figure: the exiled son of the shah overthrown in 1979, Reza Pahlavi. Despite monarchism still repelling many, Iranians are taking Pahlavi more seriously. A fractured opposition seems to be coalescing around him. In the background, the threat of another war looms, with Israel carrying out 12 days of air strikes in Iran last summer. Binyamin Netanyahu, its prime minister, seems keen on a second round, targeting Iran's ballistic-missile programme. The possibility of foreign intervention has added to the regime's woes, with many Iranians wondering if their country might be next in Donald Trump's cross-hairs. The regime's attempt to reform its economy by scrapping a preferential exchange rate and sending monthly cash transfers to Iranians has been met with skepticism. The sum in question is worth less than $8, barely enough for a bag of rice or a jug of cooking oil. Unifying the exchange rates will also fuel inflation, already above 40%. The situation is volatile, with officials within the regime considering a Venezuelan-style solution: sacrificing the supreme leader to save the system and stave off chaos. Some are even discussing installing a new leader, such as Mohammad Bagher Qalibaf, the parliamentary speaker and former commander of the Islamic Revolutionary Guard Corps (IRGC). As the regime teeters on the brink, leaders in the Arab Gulf states are nervous that they may be targeted too. The 37th year of Ayatollah Ali Khamenei's leadership could yet prove as climactic as that of the last shah—toppled after 37 years on the throne.