Ahmadinejad in a bind as poor begin feeling the pinch

Tehran: Imagine you are the president of Iran. You awake to discover that a US nuclear-powered aircraft carrier is heading in your direction, as is a new anti-missile defence system to protect your neighbours from the missiles you plan to point at them.

A bad week? Not really, because you have just taken delivery of a new missile system of your own.

Ahmadinejad came to power in 2005 promising to use oil money to cut the gap between rich and poor. If he has succeeded, it is only because both groups are now struggling to make ends meet.

Instead, while the Iranians are at the Americans' throats throughout the region, internal inflation and unemployment are running at 30 per cent and rents and property prices are 40 per cent higher than six months ago.

Even former supporters are questioning whether turning the entire United Nations Security Council against Iran was a bright idea.

Last week, 150 parliamentarians - just over half of Iran's 290 MPs - took the extraordinary step of signing a letter blaming Ahmadinejad for the country's woes and accusing him of planning to squander the country's oil earnings, which account for about 80 per cent of its revenues, in next year's budget.

It was a sure sign that what limited backing Ahmadinejad had from Iran's supreme leader, Grand Ayatollah Ali Khamenei, had evaporated.

The hardline conservative newspaper Jomhouri Islami, a reliable indicator of Khamenei's thinking, spelled it out.

"Speak about the nuclear issue only during important national occasions, stop provoking aggressor powers like the United States and concentrate more on the daily needs of the people," it wrote.

The warning signs were already there. Last month, the former president, Hashemi Rafsanjani, a wily opponent of the current incumbent, came out on top in elections to the council of experts, the body responsible for choosing Iran's supreme leader.

And while Ahmadinejad's sister, Parvin, picked up a seat in local elections, other supporters of the president were routed, securing just 20 per cent of the votes. The elections were regarded as a referendum on the president's first 18 months in power.

Iranian economists say that Ahmadinejad's domestic problems stem from his devotion to the 'khodkafai' economic model of Iranian self-sufficiency, rather than the alternative Chinese model - favoured by Rafsanjani - which embraces markets and international trade.

Ahmadinejad is an ascetic. He lives in a small house, drives an old car and does not bother with such fripperies as a dishwasher.

Money has flooded out of the country as those with spare cash invest it in property hotspots around the Arab world.

Ayatollah Shahroudi, Iran's judiciary chief, has estimated that over $700 million have left the economy and gone overseas in recent months. As many as 1,000 educated people are leaving the country every day.

Even the poor are now feeling the pinch. "People are really under pressure," said Tehran housewife Maryam Hatamkhani. "We are unhappy. Instead of bringing welfare, this government has given us hardship."

Undeterred, Ahmadinejad is planning to introduce petrol rationing at the start of the new Iranian year, in late March. The fuel price rises are the result of the president's attempt to cut dependency on foreign imports.

Businessmen interviewed in Tehran, last week, were already wincing at the knock-on effects of the price rise. "This will multiply all other costs, such as taxi fares, transportation and food, because it is a chain reaction," one warned.