The expected one: Shi'ite messiah animates and divides Islamic Republic

In two speeches delivered in the opening days of Nowruz, Supreme Leader Ali Khamenei appeared to indirectly respond to US President Donald Trump's letter proposing a new deal.

In his first address, a pre-recorded message aired on state television, Khamenei blamed the United States for instability in the region. In the second, delivered live, he denied commanding Iran’s regional proxy forces but warned Washington of a strong response to its military actions in the region.

Tehran has yet to issue an official response to Trump’s letter, as few details of its contents have been made public. In a New Year’s Eve interview with state TV, Foreign Minister Abbas Araghchi said the letter included “many threats and a few opportunities.” He added that Tehran is still evaluating the message. Meanwhile, US media reported that Trump gave the ayatollah two months to consider before replying.

Perhaps in an attempt to ease the pressure on Khamenei, Reformist commentator Ahmad Zeidabadi suggested in a tweet that the Islamic Republic should hold a referendum to determine the will of the people.

Given the widespread concerns expressed on social media and in call-ins to Persian-language TV channels based in Europe and the United States, it's clear that the economy—and its impact on daily life—is the top priority for most Iranians. It would not be difficult to predict the likely outcome of such a referendum.

In a post on X, Ahmad Zeidabadi wrote that Iran has two months to choose between war and an agreement with the United States. “Tehran must make a decision while its officials are unprepared for either option,” he said, adding, “They believe an agreement would bring humiliation, while a war could be devastating. Hence, the indecision.”

Zeidabadi warned that some are exploring a so-called third path—one that could ultimately lead to both humiliation and destruction. He noted that the current situation was foreseeable and, in fact, some politicians had predicted it, but their warnings went unheeded.

He also pointed out that while referenda are mentioned in Article 59 of Iran’s Constitution as tools to resolve difficult political, economic, social, and cultural issues, they have never been clearly defined or seriously pursued within the Islamic Republic’s framework.

Khamenei, however, has consistently rejected the idea of holding a referendum on any issue, dismissing proposals even from well-wishers like former presidents Hassan Rouhani and Mohammad Khatami on multiple occasions.

Yet, a referendum could offer him a way to resolve the current impasse—allowing him to shift the burden of any potential compromise with the United States onto the people. Still, many who commented on Zeidabadi’s post on X argued that no meaningful referendum is possible under current conditions. They noted that without a free press, functioning political parties, and open public debate, a genuine vote would be impossible. They also called for an end to the imprisonment of political activists, the unblocking of social media platforms, and guarantees for freedom of expression and assembly as prerequisites for any credible referendum.

Some analysts believe the mix of threats and defiance in Khamenei’s recent speeches suggests he is thinking aloud, searching for a way out of the current impasse. As he acknowledged in his first address, Iran’s main challenge is its struggling economy, severely weakened by US sanctions. While he is unwilling to appear submissive to his archenemy, America, the only viable path to economic relief may lie in accepting Trump’s conditions—an option that would be especially difficult for a leader known for his uncompromising stance.

Others pointed out that the government has consistently ignored public opinion in the past and holding a referendum now would be shifting responsibility onto the people for any potential compromise. Some expressed skepticism that even after a referendum, the Iranian government would truly respect the people’s will.

One commenter remarked that, as usual, Iranians would be left choosing between “bad and worse.” Still, some speculated that Zeidabadi may be hoping a referendum would give like-minded reformists an opportunity to participate more freely in the political process.

At the end of an interview with Tucker Carlson on Friday, President Trump’s special envoy to the Middle East expressed hope that he or someone else from the administration might visit Tehran, as Carlson had suggested. Witkoff acknowledged the complexity of the Iran issue due to its nuclear dimension and the need for technical expertise. “I’m going to welcome that opportunity if I’m involved,” he stated.

So far, there has been no official Iranian reaction to Witkoff’s remarks. However, Nour News, a media outlet close to Iran's Supreme National Security Council, said in a tweet in English on Sunday that Witkoff’s tone “won’t clear up misunderstandings as no behavioral changes have occurred,” referring to US policies toward the Islamic Republic. Nour News added that the US is still pursuing talks while exerting pressure on Tehran. “If Washington wants a new nuclear verification process, it must first present real evidence of Iran's intent to obtain nukes!”

The lack of more commentary in online publications may be due to limited resources during the Nowruz holidays. Some public figures, however, have also commented on the interview via social media, where high engagement suggests significant public interest.

Throughout the lengthy interview, Witkoff reiterated that President Trump was open to negotiating a resolution with Iran, allowing the country to reintegrate into the global economy without the burden of sanctions. He emphasized Trump’s preference for diplomacy over military action and suggested that a verification program could be established to ensure Iran’s nuclear program remains peaceful.

Speaking on Fox News on Sunday, Witkoff reinforced the administration’s message to Iran, urging diplomatic engagement to resolve ongoing tensions. “And if we can't, the alternative is not a great alternative,” he warned, stressing that the U.S. would not allow Iran to develop nuclear weapons.

Diverging perspectives within the Trump administration

Witkoff’s remarks—particularly his focus on controlling Iran’s nuclear program through verification—contrast with statements from President Trump and other senior officials, who have called for the complete dismantling of Tehran’s nuclear program. White House National Security Advisor Michael Waltz reiterated on Sunday that the Trump administration seeks the full dismantlement of Iran’s nuclear program in a transparent manner that satisfies the international community.

Reactions from Iranian figures

“Dear friends in the Foreign Ministry, Witkoff has expressed interest in visiting Iran!” wrote Nosratolah Tajik, a relatively moderate politician and former diplomat, in a brief post on X on Saturday. He suggested that Tehran should invite Witkoff before formally responding to President Trump’s letter to Supreme Leader Ali Khamenei—both as a gesture of diplomatic goodwill and a display of political savvy, while also helping to deflect public criticism.

“It’s not just me saying this—former senior diplomats from the Foreign Ministry also advise against rejecting Witkoff’s expression of interest in visiting Iran,” wrote senior reformist journalist Mohammad Sahafi, referencing Tajik’s post.

An expatriate dissident, Akbar Ganji, echoed this sentiment, advocating for direct talks between Iran and the US, starting with a meeting between Iranian officials and Witkoff and eventually progressing to a summit between the Iranian and US presidents to finalize an agreement.

Former Reformist diplomat and political editor Abdolreza Raisi also backed the idea of hosting Witkoff in Iran. “How can we refuse to host him now that he’s expressed interest in visiting, especially to verify such claims and put the ball in their court?” he wrote in a post on X.

Skepticism from US analysts

Jason Brodsky, Policy Director at United Against Nuclear Iran (UANI), suggested in a post on X that certain Iranian officials and regime sympathizers may be attempting to exploit perceived divisions within the Trump administration. According to Brodsky, these figures are bypassing Secretary of State Marco Rubio and National Security Advisor Mike Waltz while engaging with officials they believe are more receptive to negotiations.

Khamenei’s formal role in economic planning

While Khamenei does not directly manage economic ministries or oversee the national budget—duties formally assigned to the presidential administration and parliament—he exerts control through other channels. This influence, rooted in both constitutional authority and informal networks, is complex and multifaceted.

According to Article 110 of Iran’s Constitution, Khamenei has the authority to determine the general policies of the Islamic Republic. In collaboration with the Expediency Council, whose members he appoints, Khamenei issues "General Policies of the System," which shape the country’s economic direction.

The Planning and Budget Organization, an administrative body, must ensure that Iran’s development plans—such as macro policies in the oil sector—align with the overarching guidelines drawn in the General Policies of the System documents.

Political

He also holds sway over the expenditure of oil revenues. Any withdrawal from the National Development Fund of Iran (NDFI) requires his approval, for instance. At least 20 percent of all oil revenues are allocated to the NDFI, and successive administrations, including Masoud Pezeshkian’s, have sought his permission to borrow billions of dollars from the fund over the years to cover budget deficits.

Directing the economy through political engineering

Khamenei appoints the head of the judiciary and the members of the constitutional Guardian Council, which has the power to veto legislation, including economic policies and budget plans if they conflict with his prescribed policies. As Iran's election watchdog, the Council also engineers all elections and ensures that candidates whose platforms are not aligned with Khamenei’s political and economic vision are not elected as president or make it to the parliament.

Economic entities under Khamenei’s direct control

Khamenei wields significant economic power through a network of quasi-charitable foundations, known as bonyads, and religious endowments.

Among the largest bonyads are:

• Mostazafan Foundation
• Execution of Imam Khomeini's Order Headquarters
• Martyrs Foundation

Originally established to redistribute wealth and support social welfare following the 1979 Islamic Revolution, these institutions have evolved into major economic conglomerates operating in diverse sectors, including agriculture, construction, mining, energy, manufacturing, telecommunications, financial services, and real estate.

Their financial activities remain opaque, despite assets worth hundreds of billions of dollars.

These entities function as strategic instruments for maintaining Khamenei’s political and economic dominance. By appointing their leadership, he ensures loyalty and strengthens his control. They also help finance Iran’s regional allies and domestic political factions aligned with him through a complex system of privilege distribution—commonly referred to as rent in Iranian economic and political jargon.

The IRGC’s economic influence

The Revolutionary Guards (IRGC), which operate directly under Khamenei’s authority as commander-in-chief, also control vast segments of Iran’s economy. They are allocated a portion of the country’s oil exports, which they reportedly sell through front companies and intermediaries to evade US sanctions—generating funds for their military operations and regional activities.

The IRGC dominates industries such as construction, energy, and telecommunications. Additionally, it is granted a direct share of Iran’s oil revenues, allegedly selling oil through front companies and third-party intermediaries to bypass US sanctions and finance military and regional operations.

The extent of Khamenei’s economic control

Quantifying the economic footprint of bonyads, religious endowments, and the IRGC is difficult due to their opaque financial practices. Nonetheless, estimates suggest these entities collectively control at least half of Iran’s GDP.

Though they are technically subject to taxation and audits, they use complex methods to conceal financial data, making meaningful oversight nearly impossible.

Khamenei’s firm grip over these institutions reinforces his dominance over the Iranian economy, limiting transparency and blocking major reforms. This control expanded significantly after a 2005 privatization initiative that channeled state assets not to a genuine private sector, but to IRGC-linked entities, bonyads, and companies benefiting from monopolistic privileges.

“I’m not at liberty to talk about the specifics,” Witkoff said in an interview released Friday on The Tucker Carlson Show. “But clearly through a, you know, back channels, through multiple countries and multiple conduits, they've reached back out.”

According to Axios, Trump’s letter to Ali Khamenei, delivered via a senior Emirati diplomat, included a two-month deadline for reaching a new nuclear agreement and warned of consequences if Iran expanded its nuclear program. The letter was described by sources as “tough” in tone.

However, Witkoff presented the message differently during his interview. “It roughly said, I'm a president of peace. That's what I want. There's no reason for us to do this militarily,” he said. “We should talk. We should clear up the misconceptions. We should create a verification program so that nobody worries about weaponization of your nuclear material.”

He also said Trump believes the issue “has a real possibility of being solved diplomatically” and “acknowledged that he's open to an opportunity to clean it all up with Iran.”

Iranian Foreign Minister Abbas Araghchi recently affirmed that indirect talks through countries like Oman are “not a strange method,” and on Friday he held a phone call with his Emirati counterpart. No details were released about the conversation.

Witkoff added that Trump wants to build trust with Iran and would prefer to avoid war. “He’s a president who doesn’t want to go to war,” he said. “He’ll use military action to stop a war.”

Carlson, a longtime ally of Trump, warned earlier in the week that a military strike on Iran “would certainly result” in a broader conflict and “thousands of American deaths.” Iranian media highlighted both his remarks and Witkoff’s interview, portraying them as possible signs of a shifting tone in Washington.

Still, Iran’s official stance remains defiant. Khamenei has rejected direct talks under pressure and, in a speech on Friday, focused instead on deterrence. “Anyone who commits villainy against the Iranian people will be struck with a harsh slap,” he said.

At the US State Department, spokesperson Tammy Bruce said Friday that Washington remains committed to preventing Iran from acquiring nuclear weapons and continues to rely on pressure. “Iran’s behavior, as we know, across the globe threatens US national interests,” she said, adding that the administration’s campaign of sanctions and diplomatic isolation has been very effective.

"I would like to wish the Iranian people, and Persians everywhere, a happy Nowruz...I wish you freedom," Netanyahu said.

"Real freedom. Freedom from oppression..." he added.

Netanyahu said he wished for a year in which "the people of Iran can finally enjoy Iran's rich natural resources, those resources that have been so long denied to you by an oppressive regime."

He also called for "security" in spiritual, economic, and physical terms, as well as "friendship" with those who "have your best interests at heart, and that includes my country, Israel."

Netanyahu has frequently addressed the Iranian people in video messages, positioning himself as a supporter of Iranian opposition to the country’s leadership.

His message comes amid rising tensions between Iran and Israel, as Israeli officials continue to push for stronger action against Iran's nuclear program.

Earlier this month, Israel's new military chief, Eyal Zamir, warned that 2025 would be focused on war with Iran and its allied groups across the region, underscoring the risk of escalation.