Iran, protests, and sanctions

What It Covers

Planet Money examines how 47 years of US sanctions shaped Iran's economy and fueled recent protests. The episode traces three key periods: post-revolution isolation in 1979, economic opening in the 1990s, and comprehensive sanctions after 2010 that caused GDP contraction, currency collapse, and ultimately violent protests in January 2025.

Key Questions Answered

• •Sanctions Architecture Evolution: US sanctions shifted from simple asset freezes in 1979 to sophisticated financial isolation by 2010, pressuring 120 financial institutions across 60 countries to stop Iranian banking. This staggered approach reduced oil imports incrementally while threatening secondary sanctions on any bank choosing Iran over dollar-based systems, effectively weaponizing global finance.
• •Economic Impact Metrics: After 2012 comprehensive sanctions, Iran experienced its first major contraction in two decades. Egg prices jumped 30 percent within weeks, currency devalued dramatically, and inflation eroded purchasing power. Research shows US and EU sanctions caused over 500,000 deaths annually in the past decade through restricted access to medicine and essential goods.
• •Sanctions Beneficiaries Paradox: Iran's Islamic Revolutionary Guard Corps controls approximately 50 percent of Iran's economy and benefits from sanctions by eliminating international competition. Without companies like Exxon or Boeing competing for contracts, the IRGC consolidates power and wealth, meaning sanctions strengthen rather than weaken the regime's economic control over the country.
• •Overcompliance Problem: After the 2015 nuclear deal, US officials including Secretary of State John Kerry met with international banks in May 2016 requesting resumed Iranian business. Banks refused, with HSBC's chief legal officer publicly declining in the Wall Street Journal. Years of compliance training created irreversible risk aversion, making sanctions impossible to reverse even when politically desired.
• •Constitutional Calcification: During Iran's 1979 constitutional debates, representatives initially considered allowing foreign investment for economic growth. The US embassy hostage crisis and immediate asset freeze sanctions radicalized discussions, leading framers to constitutionally ban foreign concessions entirely. This founding opposition to Western economic engagement became embedded in Iran's political DNA, shaping four decades of isolation.