Persian Mirrors: The Elusive Face of Iran (53 page)

The corruption in many foundations reflects a more widespread corruption in all sectors of the economy. Payoffs are needed to obtain a government contract, to get a permit or license, to get raw materials or goods through customs, to price goods in the market. Police officers openly stop motorists and pedestrians and ask for protection money. One policeman who patrols the street where a friend lives stopped her one day and said simply, “It’s Friday.” In other words, Friday is the weekend, the street is safe, and a reward is in order. All of this breeds a general cynicism. With about 60 percent of the economy exempt from taxation through various arrangements with the government, it is not surprising that roughly 85 percent of the population evades income tax.

Yet some of Iran’s most senior clerical leaders dismiss the importance of corruption. After the arrest in 1998 of Mayor Karbaschi on corruption charges, former President Rafsanjani wondered what all the fuss was about. “Graft has always existed,” he said in a sermon. “There are always people who are corrupt.” But then again, the reformist press had openly accused members of Rafsanjani’s family of corruption, and Karbaschi, though a reformer himself, had old ties to Rafsanjani.

I have gone looking for clues to Iran’s economic predicament in Tehran’s Grand Bazaar. What I have found is a hive of tradition, immensely captivating in its color and cultural roots, impressive in the spirit of its private enterprise, that is nevertheless playing a big part in stifling the country’s economy. It also provides a power base for a class of politically conservative merchants.

There is permanence to the bazaar. What the British writer, traveler, and diplomat Gertrude Bell wrote in 1894 about the vast marketplace in Tehran holds true today. “The whole bazaar resounds with talk, with the cries of the mule-drivers, the tinkling bells of the caravans, and the blows of the smiths’ hammers,” she said. “The air is permeated with the curious smell, half musty, half aromatic, of fruits and frying meats, merchandise and crowded humanity.”

The bazaar in Tehran covers a vast area in the city’s oldest sector and is built on an angle to the street grid so that it can face Mecca. The six hundred shops and stalls spill out onto neighboring streets lined by crumbling buildings with wrought iron balconies dating back to the early part of the century.

Except for the carpet sellers, most of the Tehran bazaar is not geared to outsiders and especially not to tourists. Rather it is a vast shopping warehouse for wholesalers and the lower classes. I once tried to buy a few sheets of gift-wrapping paper. I was told I had to buy a hundred. It really isn’t necessary for most shoppers to go to the bazaar anymore, especially since Mayor Karbaschi built twenty-four-hour chain stores throughout Tehran.

The Tehran bazaar is divided according to trade. There are streets named after the gold sellers, the shoe sellers, the fabric sellers. The narrow passageways are choked with people, not only shoppers but wizened porters pushing wide wooden carts piled high with goods, boys carrying scalding pots of tea and trays of glasses, other boys pretending to sell tea who are really selling pirated CDs and cassette tapes, men driving their motorcycles through the bazaar oblivious to the no-driving rule.

The bazaar is also a densely built community center—a maze of mosques, public baths, religious schools, teahouses, unlit alleys, and back rooms that serve as meeting places and centers of communication and discovery. I turn one corner and come upon
Timche Hajebol-doleh,
an open space lit from a hole in the beautifully tiled ceiling. I turn another and find a headquarters of the Revolutionary Guards. I turn yet another and find myself at a mosque at midday where some men pray while others carry food, mend clothes, sell cigarettes. A lone leper begs; a dervish negotiates a deal.

I went to the bazaar one day with Peyman, a charming young man who owns a small clothing manufacturing company. He knows his way around because he goes there to buy his fabric. He told me that Mayor Karbaschi had wanted to make changes in the bazaar, but the merchants don’t much like change. Peyman pointed out a nearby park—not much of a park, with mangy grass and scraggly flowers. “Karbaschi tried to build a ten-story parking lot,” Peyman told me. “The project started and the cement was laid. But there were objections. The
bazaari
said, ‘The bazaar has been like this for a hundred years. We want to keep it that way.’ Karbaschi was an outsider and they didn’t want him to get a foot in here. They took their objections to their supporters in Parliament who also objected. It went all the way up to the Leader. The parking lot was stopped.”

There are invisible boundaries here—of smell, of sound. And there are closed places where only the invited enter. On my trip with Peyman, I peered into small rooms behind glass doors where a group of six to eight men sat, talking. The Azeris dominate the bazaar, and much of its business is conducted in Turkish, not Persian. Instead of secret handshakes and passwords, the
bazaari
call each other
haj agha,
an honorific that combines “Mr.” with the title
haji,
an assumption that the addressee has made the pilgrimage to Mecca at least once.

There are no computers in sight but plenty of abacuses and adding machines. There are no female merchants either. In Tehran’s bazaar, women have only one role. “It’s tradition,” Peyman said. “Women can shop but they cannot sell.”

We stopped at the stall of a young fabric merchant named Shahin, who asked us to sit and served us tea. His grandfather had been a bazaar merchant, and his father’s stall was nearby. Shahin called himself a “new
bazaari.
” He didn’t pray; he didn’t believe in the superstitions that governed the
bazaari
world. “Don’t misplace anything on Wednesdays or Sundays,” Shahin said mockingly. “Otherwise you will not sell them. Always cut fabric on Mondays.”

I asked Shahin why there were no computers in any of the stalls. Superstition, it turned out, had nothing to do with it.

“
Bazaari
are afraid of tax collectors,” he said. “
Bazaari
will do anything to avoid taxes. Sometimes people have big offices upstairs. That’s where they hide their computers. They don’t want the tax collectors to see them. We want to have everything as simple and as old as possible. People with mobile phones hide them in a drawer.

“We have an expression in the bazaar. You have five fingers but you have to hide one of them. Show only four fingers. We always say that business is bad. There’s always a recession. If people don’t think your business is bad, they may give you the evil eye and make your business bad. There’s always the fear that if one businessman is too successful the others will unite against him.”

In a taxi on the way home, Peyman asked me what I thought of the
bazaari.
Then he answered his own question. “I hate the
bazaari.
They have very cushy jobs. I’m a producer. I make things. I have to buy the buttons, the zippers, the cloth, the thread. I have to employ seamstresses. I create jobs for others. In my workshop I support at least ten people and their families. Under the law, I can’t fire them if they don’t perform. All the
bazaari
do is buy and sell. They don’t put things in the ground to grow. They don’t pay taxes. Every time the rial loses its value,
bazaari
hoard their goods. But they make a lot of money. If they invested their money in production, things would change. It would build strong pillars for the economy. But they’re just middlemen. Buy and sell. Sell and buy. That’s all they do.”

Peyman had put his finger on one of the reasons why Iran’s economy doesn’t grow. The
bazaari
aren’t investors looking to build the country over the long haul. They are cash-and-carry merchants looking for quick deals. They finance most private industry at interest rates of 7 percent per month. The government allows them to import goods at special exchange rates. Traditional in their business habits, they don’t computerize or trade on the Internet, or they hide the fact that they do so. Religious, the
bazaari
have had a close alliance with the clerics since the nineteenth century. The money that many
bazaari
gave to the mosques and their decision to shut down in the months before the revolution were critical for Ayatollah Khomeini’s success. They continue to support some of the country’s key clerics, and in turn those clerics protect the interests of the bazaar.

In the end, all of this economic irrationality has hurt the middle class the most. The rich and the politically connected have done just fine, accumulating wealth through trading and real estate and currency speculation; the poor have benefited from the revolution’s massive subsidies, better access to education and housing and building projects. But for the middle class, living standards have deteriorated. I just needed to look at Nazila’s family to see that. Her father, a retired government official, had studied in England and later lived abroad, as had many middle-class professionals. But when the time came to send Nazila and her sister, Golnaz, to college, there was only enough money to send them to local universities.

In that atmosphere, survival has become the mark of success for the middle class. I am close to a woman whose entire family was in one way or another involved in government service at the time of the Shah. Most of them lost their jobs or chose to resign their positions after the revolution. So they reinvented themselves as small entrepreneurs: an oil company scientist and researcher went to work for a private medical laboratory and later managed to help found a medical laboratory; a naval officer became the owner of a furniture store; his wife, a homemaker, helped in the lean years by setting up a thriving home-based business making and selling clothes; an engineer founded his own contracting business.

My friend Abdol-Karim managed to survive in a different way—by working
with
the Islamic Republic. A gregarious man of sixty with a big nose, big smile, big mustache, and big Rolex watch, he isn’t a classic
bazaari,
tied to one product and hiding his money. But he is a trader, an import-export merchant, buying from Japan, South Korea, China, Europe, even the United States, and selling whatever the market wants. He circumvents the American embargo by moving goods through subsidiaries in Toronto and Dubai. He can get a top-of-the line GE Profile refrigerator for $3,500, a hefty sum, but not unrealistic in Iran for a well-made status symbol.Peyman would not approve of him, because he is a trader who turns a profit, not an investor who helps create jobs and self-sufficiency.

Over lunch one day in the comfortable apartment he shares with his wife, Abdol-Karim recalled the day he stood on the roof of a building in what he still calls “Eisenhower Square” (the revolution renamed it
Azadi
or Freedom Square), when Khomeini came home. “I said to myself, ‘From this day on, I won’t have to bribe anyone anymore.’ The next time I was at customs, I told the officer to get my goods without a bribe, and he did. But within only three months, things changed. They were exactly like they were before.” The new government confiscated Abdol-Karim’s share in a bank and a factory. He lost about $600,000. It took years to rebuild his business.

Abdol-Karim made friends with people in the ministries, particularly in the Ministry of Defense, and in the foundations. One of his specialties was finding American-made spare parts for military vehicles and equipment from third countries. (He said he drew the line at selling American-made parts for weapons. He spends about three months a year in the United States and has no intention of landing in an American prison.) He boasted that a deal that would take a government office six months takes him only three days. Still, he can’t compete with the foundations. He pays taxes; they don’t. They have access to low-interest bank loans; he doesn’t.

I asked him why he didn’t move to the United States, where he had family. “I love doing business over there,” he said. “People keep their promises in business. But it’s too far away. Too lonesome. They still need my expertise here. I’m needed. And I have family here. I get homesick for the Eastern way of life.”

His wife, who had been silent for much of the lunch, suddenly piped up. “I go crazy in the States after only ten days,” she said. “I even miss the grocery store on the corner. I feel easy here, peaceful. I even love the weather. I just don’t feel that way there.”

Easy? Peaceful? In a country where you never know when you might be stopped on the street by a thug telling you to fix your head scarf? But Abdol-Karim’s life is an ordinary, nonpolitical, and family-centered one. For him, at least, business isn’t bad. He and his wife are in good health. And they own a small house on the Caspian coast just a block from the sea, in a country they love.

They have, in short, survived. It is because of people like Abdol-Karim that the country limps along. It is also because of people like him—traders, not investors—that the economy doesn’t grow.

In addition to survivors, Iran still has dreamers. Hosein Sabet is one. He is building an Iranian Disneyland. Or maybe I should say Wonderland, because he is trying to make Iran a tourists’ paradise. And the effort, once you take a close look, just gets curiouser and curiouser.

Sabet is thin, tanned, fit, and long-haired. He is clean-shaven, wears un-Islamic short-sleeved shirts unbuttoned one button too many, and he shook my hand.

“Sabet was well born,” he said of himself over pastries and tea in the white-walled, modernistic headquarters of the Sabet Organization, which looks out over the Persian Gulf. “His grandfather owned vast estates; his father had been a wealthy tea merchant.

“Since I was a child I had three dreams: to become a businessman, a helicopter pilot, and a magician. I have become all three.” He entered the tourist business by building an empire of seven hotels in the Canary Islands that catered to German tourists. Years later, he said, his late mother came to him in a dream and said, “Build a bridge and go back to Iran.” He decided to go home. He went to Kish, an island off the southern coast of Iran lined with sterile, air-conditioned, glass-and-marble duty-free shopping centers. He bought two hundred acres that included a partially built luxury hotel from the time of the Shah, which he redesigned with the help of Spanish and British architects to look like a modern-day Persepolis. He uprooted ten thousand palm trees and ten thousand evergreens from the mainland and transplanted them. He brought in hundreds of tons of soil. He built a water desalination system. When U.S. sanctions prevented him from buying the American-made aquarium-quality glass he needed, he hired European technicians to manufacture it in Germany. He designed a butterfly enclave and giant volcano exhibit, a rain forest with hundreds of exotic birds. He built international restaurants representing the cuisine of different countries. There would be no showgirls or alcohol at his nightclub, but there would be laser and water shows.