IRAN: Another Crisis for the Shah

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A grim week of strikes, slowdowns and lingering discontent

Can the Shah survive? Will strikes and slowdowns lead from near anarchy to total chaos? Where is Iran going?

These were questions that plagued nervous Western diplomats as Iran—the oil-rich keystone to stability in volatile Central Asia—staggered through another week of turmoil and antigovernment demonstrations that have brought the economy to a virtual standstill. A walkout by 11,000 employees of Iran Air grounded all 162 daily flights of the country's flag airline; more serious was a strike by 37,000 workers at Iran's nationalized oil refineries, which initially reduced production from 6 million bbl. per day to about 1.5 million bbl. That strike not only cost the government about $60 million a day in oil revenues, but also suddenly raised the specter of petroleum shortages in Japan, Israel, Western Europe and, to a much lesser degree, in the U.S.; all these countries depend in part on Iranian crude.

At week's end some oil personnel were already back on the job. But the country's mood remained tense as troops with automatic weapons and tear-gas grenades fired on demonstrating students at Tehran University. The government said there were no deaths, but student groups claimed that 40 or more had been killed. Meanwhile, Shah Mohammed Reza Pahlavi was consulting with leaders of the opposition on how to maintain order without jeopardizing the liberalization policies that he initiated last summer.

The oilworkers' walkout climaxed two months of labor unrest that has spread to nearly every sector of the economy. Demands ranged from pay hikes to compensate for Iran's oil-fueled inflation (officially pegged at 50%) to political reforms, an end to martial law and the release of all remaining political prisoners. Stung by a strike that involved 1 million civil servants and government workers, authorities by and large have acted swiftly to satisfy many of the grievances. Government workers were granted wage increases ranging from 25% to more than 100% as well as such fringe benefits as subsidized housing. To help pay for the $1.5 billion settlement, Iran canceled orders for $7 billion worth of military hardware that had been placed with U.S. and European companies. Ironically, many of the workers who had won increases did not get their paychecks last week. Reason: employees in the Finance Ministry were still out on strike.

Many workers seized on the unrest to press for specific noneconomic reforms as well. Employees at major banks, which have been a frequent target of fire bombs and arson by antigovernment demonstrators, walked out, demanding that they be given protective security. The press, which was partly unshackled last month, successfully won an end to all censorship. Employees of the government-financed National Iranian Radio and Television network, who struck for the second time last week, demanded—and got—Premier Jaafar Sharif-Emami's assurance that there would be no more government interference. Workers at one Tehran daily even struck in opposition to what they called management's "self-censorship" of the news.