COLD WAR IRAN: FERENGI, GUNS, AND BUTTER

What’s Happening to the ‘Hood?

While American and Iranian neighborhoods were somewhat segregated in Cold War Isfahan, there was much intermingling. Buses carrying Westerners traveled back and forth through various  areas of Isfahan every half hour. Since many Americans took great pride in living off the local economy, the buses traversed the oldest areas of the city, stopping frequently, and making visible the differences which existed between the two communities.

Some areas of Isfahan were virtually taken over by expatriates. These included the bazaar, the major shopping corridor along Chahar Bagh Bala, Abbasabad Avenue near the Anglican Church and the English Bookstore, and the neighborhoods surrounding the Kourush Hotel.

Along Chahar Bagh Bala, a favorite of the Western community (as well as busloads of Soviet workers and their families), recently constructed multi-level European-style shopping centers dotted an avenue lined by plane trees and garden pavilions. Nearby, the Shah Abbas Hotel, situated in an old caravanserai, had become associated with Western decadence. It was one of several places in Isfahan that routinely served as a watering hole for expatriates. Other encroachment was also visible, particularly in new buildings like the Kourush and Park Pol Hotels where employees of Grumman and Bell Helicopter International (BHI) were housed for months on end waiting for permanent quarters to become available.

Many of the urban modifications, though, were unrelated to the American intrusion. Instead, they were a continuation of the international planning trends which had taken hold in the 1930s. Nevertheless the Americans were a convenient scapegoat and many locals attributed unwanted change to the physical presence of the foreign community.

Can Isfahan Survive?

As a result of the many changes, on the eve of the 1979 revolution, serious observers were asking the question “Can Isfahan Survive?” Concerns regarding the built environment were voiced most prominently in a May 1976 special issue of Architectural Digest titled simply Isfahan. The editors noted:

If by Isfahan is meant the [traditional] character of the city as portrayed in the preceding pages of this issue, the chances of survival are slim indeed. For Isfahan is designated in the Fifth Development Plan 1973-1978 (together with other historic cities like Tabriz, Mashad, and Shiraz) as a ‘pole’ city for further industrial expansion in the hope that with increased opportunities for employment, it will become a strong magnet attracting immigrants from rural areas who would otherwise go to Tehran. In the last 10 years the population of Isfahan has increased by nearly 50 percent and, if that rate is maintained, it will double to 1 1/2 million over the next 20 years. It would not be unreasonable to infer that official policy is prepared to sacrifice one of the finest cities in the world for the sake of a modern capital which has become, in the words of an Iranian architect, ‘an ever-expanding hub of ugliness.’

Agriculture is Threatened

Most importantly, Isfahan’s agricultural base was threatened by residential development and new industry related to the mushrooming military industrial complex.

The most damaging type of new development involved the destruction of large old courtyard homes so that owners could make a quick profit by selling subdivided plots or building multi-story blocks of modern apartment buildings. A person who pulled down his old house and built a new one was exempted from taxation for three years. Intended as an incentive for slum clearance, this law became a serious threat to heritage.

Development was especially visible along the southern stretch of Chahar Bagh with modern new structures — surrounded by construction sites — serving as homes for recently arrived Americans. Although Grumman employees were required to move to more peripheral areas, representatives of other corporations as well as subcontractors were still situated in the center of town.

New construction was also evident in Julfa, the old Armenian quarter of the city. Here water channels which once irrigated gardens were no longer needed and residents didn’t object when authorities diverted the water elsewhere. As Cantacuzino stated:

Today all the channels are dry and the gardens which survive barren and ready for the concrete mixer.

The pollution in the traditional channels — know as jubes — provided symbolic evidence of the impact of secularization on the city. According to one planner:

Water has always been an essential element in Iranian towns. Its rarity in an arid country made people respect and treasure it. Indeed Islam holds that water is holy. With the influence of religion in decline, water today is commonly defiled with garbage, while the empty pools in the caravanserais are used as dumps.

in addition to pressures on the urban core, new developments were spreading into the agricultural land surrounding the city. To the east, private haphazard development stretched into the countryside where land was cheap. By late 1977, problems associated with the housing shortage and the building boom were exacerbated by an overall economic downturn.

Economic Downturn and Price Controls

Scarcities of necessary items occurred in early 1978, just as an increasing array of European luxury goods and appliances became more common. Krups coffee makers and blenders, televisions, and refrigerators were now readily available. At the same time, groceries on the local market became more expensive and hard to find. One couldn’t buy chicken if eggs were available and vice versa; even seasonal vegetables were in short supply.

At first wealthy businessmen, but then the smaller merchants, were hurt by the implementation of price controls on basic commodities. Concurrently, large quantities of imported goods — rice from North Carolina, lamb from New Zealand, and chicken from Rumania — were brought in to undercut local dealers.

To some extent the foreign community was protected against rising inflation by cost of living clauses in their formal contracts. Still, most felt the pinch, with the cot of living index almost doubling in a six year period.

Isfahanis blamed the foreign community since it was linked to the regime’s ‘crash’ industrialization program and to the continued growth in the military establishment. On the other hand, the regime blamed the local business community.

Guns or Butter

As discussed above, the shah declared war first on “big business” profiteers, then on shopkeepers and small businessmen, finally imposing price controls on basic commodities. When Iranians suggested a “guns and butter” connection, the shah argued that their thinking was shortsighted. He posed the problem differently, asking:

What is the use in having an advanced industry in a country which could be brought to its knees when faced with any small, asinine event?”

The US agreed, observing that:

. . . the percentage of the total Iranian budget allocated to defense has decreased from 32% in 1974 to 22% in 1975 and 24% in 1976, as total Government expenditures increased from $11 billion in 1974 to $36.9 billion in 1976. The revenue increase, almost entirely from oil, was of sufficient magnitude to fund virtually all programs, civil and military; choices between guns and butter were not necessary.

Photograph by Cordelia Persen.