November 18, 2019

Memo: Iran Protests, Internet Blackout & Government Crackdown

The Iranian government abruptly announced last Thursday that the price of gasoline would be increased, triggering widespread protests from a population already under severe economic hardship due to governmental mismanagement and the impact of U.S. sanctions. Videos out of Iran show violent confrontations between security forces and protesters, with tear gas and riot police being deployed and, in some cases, live ammunition used.

According to BBC Persian, as of Sunday, at least 12 people have been killed, dozens injured, and roughly 1,000 arrested. At least one hundred banks and dozens of gas stations and stores have been damaged in the roughly 100 cities where protests have erupted. Access to the internet has also been severely limited by the Iranian government, severely hindering the ability of ordinary Iranians to connect with the outside world.

For Members of Congress, we encourage three actions. First, condemn the Iranian government’s ongoing stifling of the internet and brutal crackdown that is in contravention of the government’s international human rights obligations. Second, take action to ensure that sanctions do not inadvertently harm the Iranian people, including by pushing to broaden licensing for vital communication technology. Third, in solidarity with the Iranian people, push the Trump administration to end its discriminatory Muslim ban and ensure sanctions no longer inhibit humanitarian trade.

The following is an overview of the gas price hike, the ongoing protests, and the implications of U.S. policy for the protests:

Protests Most Far-Reaching Since Winter 2017/2018 Unrest

  • The wide scope of the protests are similar to the tumult that rocked large parts of Iran in late December 2017 and early January 2018.
  • Like those protests, these protests were also spurred by economic grievances and the slogans of many demonstrators have addressed broader political grievances and targeted the entire political system.
  • The protests have been marked by a high-degree of violence between security forces and protestors. In videos posted on social media, security forces can be seen firing live ammunition at protests, beating people with batons, firing tear gas, and damaging the vehicles of protesters.
  • The protests have also been marked by demonstrators blocking off roads and leaving their cars in traffic. Videos also show government buildings being attacked and set on fire–including offices of local Basij paramilitary forces and religious officials–as well as shops, banks, and other property.
  • Notably, when the price hike was first announced, social media channels affiliated with the Revolutionary Guards promoted people abandoning their cars in traffic, leading some to speculate hardline forces sought to trigger and use protests to weaken their moderate and reformist rivals.


U.S. Sanctions Are Helping Enable Internet Shutdown

  • Since Saturday, the Iranian government has mostly shut down internet access in the country. The shutdown is the country’s longest and most limiting to date.

  • Many Iranian Americans have now also lost their only means of communication with loved ones in Iran, whether through WhatsApp, Skype, or other similar services.

  • In recent years, U.S. sanctions have created a double layer of censorship on the Iranian people’s online activities by limiting their ability to use vital communication tools and outside-based cloud and web-hosting services.

  • Overcompliance with sanctions has led major tech companies to restrict their software and services to Iranians in recent years. This includes access to the Apple App Store, Coursera, edX, Github, Slack, and vitally, Amazon Web Service and Google Cloud.

  • As a result, ordinary Iranians have lost access to virtual private networks (VPNs) that enable them to circumvent government censorship and spying, forcing Iranians onto government infrastructure.

  • The consequences of this are now evident, with the Iranian government far more effectively able to shutter the access of ordinary Iranians to the internet.

  • At this critical juncture, Congress should push the Treasury Department to revise General License D-1, which exempts certain software and hardware vital for communication on the internet but hasn’t been updated in over five years.

  • A new rule should provide license authorization for U.S. and foreign persons to provide Iranians access to all technology and services necessary for Iranians to access virtual private networks, including cloud-based software.


 Government Shows No Signs of Rescinding Price Hike

  • President Rouhani’s announcement of the price hike was met with fierce backlash from his conservative rivals, reformist and hardline members of parliament, and senior clergy.

  • At least two members of parliament have resigned, including a prominent reformist MP representing Tehran.  Both reformist and conservative parliamentarians denounced the fact that they weren’t consulted on the price hike and hardline MPs have now introduced bills to impeach Rouhani and parliamentary speaker Ali Larijani.
  • Despite this, Supreme Leader Ayatollah Khamenei has publicly defended the price hike and labeled protesters as “thugs” connected to outside powers.

  • While some hardline institutions and media are attempting to scapegoat the centrist Rouhani for the price hike, Khamenei’s support makes it unlikely that the price hike will be rescinded.

  • Khamenei also noted that the price hike decision wasn’t made by just the Rouhani administration, but by a high-level economic body comprised of the heads of the three branches of the Iranian government—which includes the hardliner-dominated judiciary.  


Price Hike Aimed at Reforming Costly Subsidy System

  • Iran’s far-reaching subsidies take up a large portion of the government’s annual budget and the country has among the cheapest gasoline rates in the world.

  • Attempts by various Iranian governments over the years to reform the subsidy system have been met with strong political backlash.

  • However, the gas subsidies have become increasingly unsustainable in the face of increasing domestic gas consumption, massive smuggling, and budget shortfalls due to U.S. sanctions.

  • According to Iranian officials, daily gasoline consumption in Iran is approaching 110 million liters, which is close to exceeding the amount of gasoline produced domestically.  While Iran is a major producer of unrefined oil, it struggles to domestically meet the demand for refined gasoline.

  • In announcing the gas price hike, Rouhani said the price would be set at two different rates and the revenue generated would be redistributed via cash transfer to 18 million poorer households. These deposits will be made monthly, with the first expected on November 22nd.

  • The more heavily subsidized rate is a 50 percent increase from the previous rate and holds for up to 60 liters of gasoline consumption a month. After that quota is surpassed, any additional gas purchases will cost three times more than the price of gas before the price hike.
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