Iranians suffering from decades of economic decay have seen the ayatollah’s billion-dollar weapons projects go up in smoke – and the rage is mounting
August 20, 2025 15:32
Two months after its devastating 12-day war with Israel, the Islamic Republic is reeling.
Not just because Israel inflicted severe damage on Iran’s nuclear and ballistic missile infrastructure, decimated key military sites, exposed the fragility of the regime’s air defences and eliminated top IRGC leaders and nuclear scientists.
Nor simply because the “Axis of Resistance” Tehran spent decades cultivating — Hezbollah in Lebanon, Hamas and Islamic Jihad in Gaza, the Houthis in Yemen and the Assad regime in Syria — now lies fractured.
More serious than external defeat is the mounting realisation among everyday Iranians that the regime has left the country hollowed out from within.
While Tehran poured billions into proxy wars and foreign militias in its campaign to annihilate Israel, it ignored the slow implosion happening at home. Now, with its regional influence weakened, the Islamic Republic finds itself staring down a domestic crisis it can no longer overlook, one rooted in decades of economic decay, environmental neglect and social repression.
Iran is on the brink of ecological catastrophe. Acute gas and water shortages are being reported in 30 of the country’s 31 provinces, including Tehran, a megacity of 10 million people.
Kaven Madani, director of the United Nations University Institute for Water, Environment and Health, told CNN that the situation was so dire that Tehran could run out of water altogether “within weeks”.
President Masoud Pezeshkian conceded in late July that the water crisis was “more serious than what is being talked about”, adding that without immediate action, the country would “face a situation in the future that cannot be cured”.
Another report released by Iran’s Water Resources Management Company found that 19 of Iran’s major dams, deemed critical for agriculture and drinking water, are operating at less than 20 per cent capacity. And with scorching temperatures exceeding 50 degrees in some parts of the country, its fragile power grid is buckling under the strain. Regular electricity cuts are being reported in major cities and authorities are ordering government offices and banks to close nationwide to conserve energy.
Iran’s domestic challenges did not materialise suddenly and unexpectedly. They are result of years of water mismanagement, government corruption, and a foreign policy that prioritised regional hegemony over the basic needs of its people. Already in 2011 Iranians were protesting over the government’s plundering of the country’s natural resources. Hundreds were arrested as they chanted about the near-demise of Iran’s biggest lake. “Lake Urmia is dying, and [Iran’s] parliament ordered its death,” protesters shouted.
Billions of dollars have been spent in developing a nuclear weapons programme and a reserve of ballistic missiles that severely imperils the Middle East and robs ordinary Iranians of basic supplies.
Even before the Islamic Republic’s military defeat to Israel and the United States, the regime’s economic backbone was crumbling.
In May and June of this year, truck drivers staged massive protests across 163 cities, grinding vital supply chains to a halt. They protested because of desperately low wages, skyrocketing inflation, rising insurance costs and a government increasingly callous about their grievances.
Rather than confront these domestic challenges, the Islamic Republic is resorting to mass arrests of civilians deemed insurrectionary — as many as 700 in June alone, including at least 35 Jewish Iranians in Tehran and Shiraz — and retreating into self-delusion.
With its military commanders battered and reputation heavily tarnished, the regime is attempting a desperate rebranding by embracing ancient folklore and pre-Islamic patriotic symbols that the theocracy had previously openly mocked to create a rally-around-the-flag effect for its populace.
In Tehran’s bustling Vanak Square pedestrians can now amble past an imposing billboard of Arash the Archer, a heroic figure in Persian mythology, firing arrows alongside the Islamic Republic’s ballistic missiles heading to Israel.
But many Iranians are likely to see this as a transparent attempt by the regime to cling to history it once scorned and to distract a disillusioned population from the rot it has created.
Nowhere is this disillusionment more powerful than in the courageous generation that rose up in the autumn of 2022, following the killing of 22-year-old Jina Mahsa Amini in the custody of the morality police. Her death ignited the most significant uprising in the Islamic Republic’s 46-year history.
“Woman, Life, Freedom” was not just a chant — it was a reckoning. Across provinces, ethnic lines and generations, Iranians demanded a future beyond religious authoritarianism. Women burned their headscarves. High school and university students clamoured for more freedoms. Workers in key industries staged nationwide strikes.
Though the regime responded with unrelenting violence and mass arrests, the embers of that movement still burn.
Now, with the regime weakened militarily, battered economically, suffocating under its own environmental mismanagement – and, in some instances, literally unable to keep the lights on – some Iranians have told me they sense opportunity.
The regime may think it can crush dissent through brute force or distract it with romanticised folklore, but it is mistaken. You cannot rewrite reality with an anthem and the people of Iran have had enough.
Jonathan Harounoff, Israel’s international spokesperson at the United Nations, is the award-winning author of Unveiled: Inside Iran’s #WomanLifeFreedom Revolt, available now for pre-order on Amazon and Waterstones and out in September 2025
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