An Authoritarian Political System Both the cabinets and parliaments were deemed as the rubber stamps of the shah. In the parliament, at first the shah established two parties: National Party and New Iran Party. These two parties became known interchangeably as the “yes” and the “yes, sir” or “yes, of course” parties. One of the pillars holding up his state was the military. Between 1954 and 1977, its share of the annual budget went from 24 to 35 percent.

SAVAK With the help of the CIA and Mossad, the Shah established in 1957 a new intelligence agency, SAVAK. The agency eventually grew into some 5,000 operatives and an unknown number of part-timer informers. SAVAK was the shah’s “eyes and ears, and where necessary his iron fist.” In 1976, Amnesty International reported that “no country in the world has a worse record in human rights than Iran.”

Social and Economic Policies: A Plebiscite The shah called in early 1963 for a national plebiscite on a six point reform program. The reform program included (i) land reform (ii) sale of government owned factories (iii) a new election law including women suffrage (iv) nationalization of forests (v) national literacy corps (vi) a plan to give workers a share of industrial profits Later, other reform points were added to these.

White Revolution: Social Policies After the launching of the White Revolution, the state pressed ahead with social programs. The number of educational institutions grew threefold, and the literacy rate increased from 26 to 42 percent. The number of students increased dramatically at all levels of the education. Health programs increased the number of doctors, nurses, medical clinics and hospitals. These improvements, together with the elimination of famines and childhood epidemics, raised the overall from 19 million in 1956 to 33,5 million in 1976.

White Revolution: Industry The White Revolution brought about a minor industrial revolution. The state improved port facilities, expanded Trans-Iranian Railway, and financed petrochemical plants, oil refineries and hydroelectric dams. The state bolstered the development of import substitution industries by erecting tariff walls and by channeling low interest loans to court favored businessman. As an outcome, the number of large-scale industrial enterprises in the country increased dramatically.

White Revolution: Land Reform The first phase of land reform was introduced in 1962. Landlords, holding more than one village, would keep one of their villages and sell the other lands to peasants. In the first phase, about 9 percent of the peasants got agricultural lands. In the following stages, the majority of peasants did not get enough land for subsistence.

Migration to Cities In the 1960s and 1970s, millions of peasants migrated to cities. Tehran took in the largest influx of rural migrants, with population growth from 1.5 million in 1953 to 5.5 million in 1979. Iranians who lived in cities constituted 23 percent of the population in 1941. This number increased to 47 percent in the late 1970s.

Class Structure in Iran At the apex was an upper class formed of a narrow circle of families linked to the Pahlavi court. These families owned 85 percent of the large firms involved in insurance, banking, manufacturing, and urban construction. With the improvements of education facilities, modern middle class, including civil servants, teachers, managers, engineers, and other professionals, expanded. As an outcome of industrial investments, the urban working class constituted more than 30 percent of the labor force.

Traditional Social Groups Traditional social groups such as shopkeepers (bazaaris) were still important actors in social, economic, political and cultural life. In the mid-1970s the bazaar continued to control as much as half of the country’s handicraft production, two-thirds of its retail trade, and three quarters of its wholesale trade. Bazaaris and their sons were increasingly crossing over into “modern” sectors of the economy. Numerous industrialists had their origins in the bazaar.

Tehran