“The Second Phase of the Revolution”

The Supreme Leader turned his sights on preserving the radical ideological origins of the revolution along with his legacy. On the anniversary of the Islamic Republic’s founding, in February 2019, Khamenei laid out his vision in a manifesto titled the “Second Phase of the Revolution,” focusing on the economy in the context of U.S. sanctions rather than cultural issues. He called on the youth to resist the U.S.’s imperialist designs against Iran, insisting that the only option for economic well-being was to attain self-sufficiency by bolstering domestic production and technical expertise.

The document read, “The solution to these [economic] problems lies in the strong, responsible and lively implementation of the policies delineated by the Economy of Resistance… Assuming that economic problems are merely the result of sanctions, and sanctions are because of resistance against imperialism and not submitting to the enemy, so the solution is to kneel before the enemy and kiss the wolf’s paw is an unforgivable mistake. This [is] completely false analysis.” Khamenei thus clarified that it was incumbent upon all Iranian citizens to participate in the struggle against the enemy because the alternative of compromise would diminish the foundations of the revolution and lead to the subordination of the Iranian people to Western powers.

The next month saw the installation of hardline conservative Ebrahim Raisi as chief of the judiciary. His appointment portended intensified domestic repression designed to quell any potential uprising of discontent with the regime. Rouhani, who had hemorrhaged much of his moderate constituents’ enthusiasm, fell back on his conservative roots and stood behind the regime’s foreign adventurism and domestic repression. His hardline credentials were brought into sharper relief after the U.S. designated the IRGC as a terrorist organization in April 2019. Rouhani’s rhetoric and actions became increasingly inflammatory. He made threats to accelerate nuclear enrichment; defended Iran’s testing of ballistic missiles in contravention of U.N. Resolution 2231; and voiced his support for terrorism as a tool of statecraft. Rouhani’s ostensible interest in compromise with the U.S. that had defined his first term rapidly hardened into maximalist demands that the U.S. lift all sanctions before Iran would consider negotiating. Rouhani’s ruse of moderation was further exposed in November 2019, when in response to another round of widescale anti-regime protests, the security forces launched a brutal crackdown that would claim the lives of 1,500 people in less than two weeks. Khamenei’s order to senior security officials and the president to “do whatever it takes to end [the protests]” was swiftly and brutally carried out.

In February 2020, Iran held parliamentary elections in which the Guardian Council disqualified record numbers of reformist candidates, including about 80 incumbents, paving the way for the hardliners to consolidate power in parliament. In response to the disqualifications and widespread disillusionment with the elected state, many Iranians refused to vote in the parliamentary elections, resulting in a turnout of only 42.57 percent. The hardliners, whom the Guardian Council allowed to stand for election, swept into power in parliament. Holding approximately 230 out of 290 seats in the majles, the hardliners voted in far-right neoconservative Mohammad Baqer Qalibaf as speaker of the parliament. Parliament and the judiciary thus now belonged to the hardline camp.

The hardliner’s ascendance in parliament gave way to calls for Rouhani’s impeachment over the failure of the JCPOA, the ailing economy, and ongoing corruption and mismanagement, ensuring that his agenda throughout his remaining time in office would be obstructed. The impact of Covid-19 and U.S. sanctions only increased pressure on the presidency. In July 2020, Khamenei came to Rouhani’s defense, saying on television, "I do strongly believe that administrations should work hard to the very end of their tenure and fulfill their responsibilities.” Subsequently, hardline lawmakers backed off their calls for impeachment.

The next month, Rouhani advocated for a “breakthrough” economic plan to deal with the government’s budget deficit, which had increased due to reduced oil revenues, but parliament shot it down. Qalibaf and Raisi reportedly penned a letter to the Supreme Leader to express their opposition to the proposal, creating gridlock as the two branches of government, now dominated by conservatives, sought to turn the page on Rouhani’s more moderate politics. While Khamenei had protected Rouhani against impeachment, his tolerance for Rouhani’s more conciliatory approach to the U.S. had run its course. Now, Khamenei turned his sights on engineering the rise of a hardliner for the presidency so that the parliament, the judiciary, and the presidency would each be controlled by loyalists to ensure a smooth succession of the Supreme Leadership, the preservation of his legacy, and the longevity of the Islamic Republic.