Erfan Fard is a counterterrorism analyst and Middle East studies researcher based in Washington, with a particular focus on Iran, Islamic Terrorism, and ethnic conflicts in the region. His father, mother, and two brothers live in Iran. His latest book is The Black Shabbat , published in the US. You can follow him at erfanfard.com and on X @EQFARD or www.ErfanFard.com.
Iran stands at a crossroads after the January 2026 bloodshed and the fragile ceasefire following the 40-day war between Israel, the United States, and the Islamic Republic. It is no longer accurately described as a classical ideological state. Instead, it increasingly functions as a hybrid system of political-security oligarchy and economic kleptocracy, where power, wealth, and decision-making are concentrated within an intertwined and largely unaccountable network.
In such a mafia- junta-like structure, the government does not operate solely through Shiite ideology, but is nourished by the connection between security institutions, political centers, and economic interests; a network in which the boundary between state, power, and wealth has disappeared. And a circle of regime insiders who benefit from its survival is deeply wound around it and intertwined inside it.
In Iran, some critics of the ruling system and supporters of regime change have used the nickname “Moosh Tabah" for Mojtaba Khamenei. This expression is more of a political wordplay than a literal association. The name “Mojtaba" in Arabic and Persian means “the chosen one" or “the selected one," and in Shiite religious tradition it also carries a special meaning.
After the terrorist turmoil of Khomeini and his circle in the 1979 period, the power structure in Iran gradually transformed from a revolutionary system into a more complex, multilayered, and gang-like order; a structure that was not a republic and resembled the Islamic caliphates of the past 1400 years, in which ideological, security, and economic institutions became increasingly intertwined.
Within this framework, the concept of kleptocracy is used to explain part of Iran’s economic reality; where public resources, large-scale projects, and financial flows circulate within the orbit of institutions tied to the power structure, and the boundary between state economy and networked interests is weakened.
Alongside this economic collapse, multi-layered security institutions gradually moved beyond their traditional domain and became the main actors in the mafia of economy and politics. And politics in Iran is managed in a tribal form. This overlap between security, politics, and economics is one of the main features of the current structure of power in Iran.
In such a system, power is not defined solely at the level of the official state, but is distributed across a broad network of parallel institutions, security circles, and affiliated economic centers; a network that in practice forms a limited but powerful oligarchy. And for this mafia structure, Iran and Iranians have the least importance, because it is solely focused on its own survival. And to preserve survival, it does not refrain from any crime.
Social Divide, Legitimacy Crisis, and Generational Change
Alongside the structural transformation of power and the formation of a political-security oligarchy, Iran is also facing a deeper and perhaps more decisive divide: the divide between society and the ruling system; a dominating, oppressive, and plundering authority that has occupied Iran, suppressed it to preserve power and wealth, and looted and auctioned it for the expansion of its destructive ideology.
This divide is not merely political, but social, generational, and even cultural. A significant part of Iranian society, especially the younger generation, has a different experience and perception of power, religion, and governance compared to the 1979 revolutionary generation. This tangible difference has gradually turned into a structural gap in understanding political legitimacy. And the ruling ideology is, for the younger generation, empty, harmful, and irrelevant to Iran and Iranians.
In such a turbulent space, the issue of “law" has also become a central point of crisis in Iran. Many analysts believe that in today’s Iran, not only political competition is restricted, but the concept of law as a neutral and universal framework has also been weakened; to the extent that public trust in official institutions has declined and a gap between society and the legal structure has emerged.
Meanwhile, part of Iran’s younger generation shows different orientations toward the country’s political future. This generation, which has grown up in a completely different environment from the revolutionary generation, is less influenced by traditional ideological discourse and propaganda apparatus, and is more inclined toward concepts such as national identity, stability, and structural change.
In this context, names such as Crown Prince Reza Pahlavi are also raised in Iranian and international discourse as symbols of possible change or political transition; although assessments regarding his role and level of influence are not unified or conclusive. But with him, a search for pre-1979 Iranian pride and identity is being sought. And gradually, for the younger generation, living under the yoke of an Islamic caliphate is becoming a form of humiliation.
Collapsed Economy, Role of the IRGC, and External Actors
Alongside the social divide and legitimacy crisis, one of the determining elements in Iran’s current situation is the country’s political economy; a devastated economy that is part of a kleptocratic structure. Within this framework, financial flows and large economic projects are increasingly intertwined with security institutions and networks of mafia-like power.
The role of military and intelligence apparatus, especially in the economic sphere, has become more prominent in recent years. This situation has blurred the boundary between military power, economic management, and political decision-making more than ever; a phenomenon widely identified as one of the main characteristics of security-economic states.
In such conditions, following the recent events - the large-scale killings following anti-regime protests and the current 40-day war - economic pressure and the expansion of poverty and hunger have also become political variables. The rise in poverty lines, increased destruction, declining purchasing power, and economic uncertainty have not only had broad social consequences but have gradually affected political behavior in society. This process has created a gradual erosion in the relationship between society and the power structure.
On the international level, Iran - with an illegitimate, isolated, and discredited ruling system - is at the center of a complex equation. Actors such as the United States, Israel, and European countries each have different approaches toward the country’s future. Some focus on containment, some on deterrence, and others on crisis management within the existing framework. And on the other hand, Gulf Arab states also cannot maintain peaceful coexistence with a rogue regime.
In this context, the question remains whether external pressure can lead to behavioral change in the power structure or merely reproduce new forms of the same existing system. In reality, Iran’s future is not a linear path, but a set of open and conflicting scenarios.
Ultimately, Iran’s situation cannot be explained through a simple narrative of collapse or continuity. What is emerging today is a complex structure of political oligarchy, economic kleptocracy, and deep social divide.
Iran stands at a point where both internal forces and external pressures are simultaneously shaping an uncertain, turbulent, and dark future. Yet this path remains open, ambiguous, and highly dependent on unpredictable developments. However, the ruling system still, out of fear of a renewed uprising, sends groups of thugs, hooligans, criminals, and terrorist militants of Shia crescent into the streets every night to intimidate people. Does such a method have any place in the 21st century?
The second round of U.S.-Iran talks, reportedly set to take place in Pakistan in the coming hours, is likely to be repeated under renewed uncertainty. The key question is whether the Islamic Republic is prepared to make fundamental concessions to preserve its system, while its propaganda apparatus continues to claim victory over the United States and Israel.
At the same time, with figures such as Ahmad Vahidi, Mohammad Bagher Ghalibaf, Zolghadr and other senior actors shaping parts of the power structure, questions are growing over how long this fragile balance can hold before turning into an internal struggle for power. These uncertainties now dominate Iran’s political landscape. Can the regime’s psychological and media operations, aimed at engineering public opinion, conceal this turmoil?
Recognizing this dual structure - oligarchy above, kleptocracy below - is key to formulating any realistic policy toward Tehran.