Sistani and Khamenei: The Kid Glove and the Iron Fist

Iran's Supreme Leader Ayatollah Ali Khamenei speaks at the Hussayniyeh of Imam Khomeini in Tehran, Iran, August 13, 2018. Official Khamenei website/Handout via REUTERS
Iran's Supreme Leader Ayatollah Ali Khamenei speaks at the Hussayniyeh of Imam Khomeini in Tehran, Iran, August 13, 2018. Official Khamenei website/Handout via REUTERS
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Sistani and Khamenei: The Kid Glove and the Iron Fist

Iran's Supreme Leader Ayatollah Ali Khamenei speaks at the Hussayniyeh of Imam Khomeini in Tehran, Iran, August 13, 2018. Official Khamenei website/Handout via REUTERS
Iran's Supreme Leader Ayatollah Ali Khamenei speaks at the Hussayniyeh of Imam Khomeini in Tehran, Iran, August 13, 2018. Official Khamenei website/Handout via REUTERS

With the latest nationwide protests in Iran -the second in less than a year- dominating the headlines, other significant developments there may not attract the attention they deserve.

One such development concerns the Shiite clergy facing what could be the biggest challenge it has faced since its formation in the 16th century.

Because many members of the ruling elite in the Islamic Republic wear clerical clothes, complete with black or white turbans, and sport mandatory beards, outside observers often assume that the Shiite clergy as an institution rules Iran. A closer look, however, may show that such a view is more due to an optic illusion than to reality.

According to best estimates, Iran, India, and Iraq, which together account for almost 80 percent of all Shiites, are home to some 400,000 clerics, most of them Iranians or boasting some Iranian background. And, yet, only a fraction is involved with the Islamic Republic in Tehran.

The Islamic Republic employs an estimated 25,000 clerics in Iran and finances a further 10,000 clerics in Iraq, Lebanon, Syria, Afghanistan, India, Pakistan, and several other African and Asian countries. In Iran, the largest corps of mullahs on government payroll is made of the 3600 Friday Prayer Leaders’ network, all appointed by “Supreme Guide” Ayatollah Ali Khamenei. Also appointed and financed by Khamenei is a nine-ayatollah “Council of Fatwa” in Qom that includes such prominent figures as Ayatollah Nasser Makarem Shirazi. The Islamic Republic also controls and finances the “Howzeh Elmieh “ (Scientific Circle) in Qom, head by Ayatollah Muhammad Yazdi.

And, yet, the bulk of the clergy in Iran has managed to maintain much of its traditional independence from political power.

According to estimates by Hassan Khalkhali, a prominent researcher of clerical issues, as far as the number of followers (muqalledin) is concerned state-appointed clerics represent no more than 10 percent of the “flock”.

More than 90 percent of Iranians who still pay “khoms” and “sahm e Imam”, that is to say, informal taxes to clerics, direct their money at mullahs as far away from the state as possible in Iran’s present circumstances.

According to sources in Qom, Grand Ayatollah Ali Muhammad Sistani, a prominent Iranian cleric living in Najaf, Iraq, and acknowledged as the current “Marja’a Taqlid” (Source of Emulation) receives more than half of all “donations” made in Iran, in turn re-cycling them through over 150 business enterprises and charities.

All this means that the late Ayatollah Ruhallah Khomeini dream of a fusion of religion and state in Iran has not been achieved. The Islamic Republic he found has quickly reverted to the original Safavid model in which the Shiite clergy played a prominent role while ultimate political power rested with the ruler.

Under Khomeini and Khamenei, the role of the ruler is played by a cleric who, nevertheless, is unable to claim supremacy in religious matters.

Being one of the top 20 ayatollahs then in circulation in his time, Khomeini was “Marja’a taqlid” for many believers in parts of Iran but never achieved the supremacy that grand ayatollahs such as Abol-Hassan Isfahani or Muhammad Hussein Borujerdi had reached in their respective eras.

Today, Khamenei’s status as a pretender to “marjaiyah” is even more dubious.

According to Kazem Assar, a leading authority on Shiite clerical matters, the “Marj’a” should fulfill five conditions.

The first is that he should be a descendant of Fatimah, daughter of the Prophet. The second is that he should be of Iranian background and nationality. The third is that he should be fluent in both Persian and Arabic. Fourth, the would-be “Marja’a” should have published a “risalah” (dissertation) attesting to his scholarship. Finally, he should be recognized, at least implicitly, by a number of grand ayatollahs as primus inter pares (first among equals).

Khamenei fulfills the first three conditions, but is nowhere near achieving the last two.

His entourage spread rumors that he has put final touches to his “risalah’ which will be out soon. People close to Khamenei’s circle say his “risalah” is ready, but afraid of possible criticism, he keeps postponing full publication. The same fear has prevented him from publishing collections of his poems composed over more than half a century but known only to a handful of confidants.

He also receives flattering messages from ayatollahs he pays in Qom and elsewhere but is never acknowledged as “first among equals.” This last point has caused him some problems.

For example, he cannot travel to Najaf, Iraq, the “holiest” city of Shi’ism because if he goes there he cannot do without seeing Sistani and the two or three other grand ayatollahs resident there. However, it is unlikely that Sistani and possibly the other grand ayatollahs would agree to go to wherever Khamenei is staying in Najaf because that would mean acknowledging him as their superior.

In contrast, if Khamenei goes to Sistani’s house, for example, it would mean relinquishing his claim of being the leader of Shi’ism or, as the Constitution of his republic claims, of the “Islamic Ummah” as a whole.

Similar considerations have prevented Sistani from traveling to Iran.

Before Khomeini seized power in 1979, Sistani used to travel to Iran every year for pilgrimages to Qom and his own native city of Mashhad. He had to end that tradition because if he went to Iran he would have to call on Khomeini or Khamenei, thus acknowledging them as superiors. At the same time if he ignored them, and they did not come to call on him, that could signal a major clerical schism.

Meanwhile, a new generation of clerics is emerging in Qom and Najaf that, provided religion remains a key factor in society, are likely to put as much blue water between themselves and Khomeini’s world vision as possible. For example, Grand Ayatollah Muhammad Jawad Alavi Borujerdi who, while maintaining polite relations with Khamenei, is slowly tracing a completely different path for the community.

The top four grand ayatollahs in Najaf and the nine officially sanctioned ones in Qom are in their 80s. And Khamenei himself is knocking on the door of his ninth decade. All of which means the current Shiite clerical hierarchy cannot be regarded as a long-term structure.

The creation of the Islamic Republic was an “innovation” (bed’ah) bound to be rejected by Shiite religious tradition. It was an attempt at the fusion of political and religious powers, something anathema to the original Safavid model. In the past four decades, it has divided Shiism into two realities: one religious, the other political, trying to co-exist but not without difficulty.

As a political reality, Shiism is today headed by Khamenei controls a major country and, despite current cash-flow problems, significant financial and economic resources. That reality can buy political support in many centers while also financing parallel armies and mercenary parties in Iraq, Lebanon, Syria, Yemen, Gaza and elsewhere. Yet, it cannot win authority on religious grounds. Even in Lebanon where the Islamic Republic has spent over $ 20 billion in the past decades, the overwhelming majority of Shiites look to Najaf and Qom, not Tehran, for religious guidance.

The way Sistani and Khamenei have reacted to the current political turmoil in Iraq and Iran highlights the politico-theological schizophrenia hat inflicts Shiism today. Sistani takes the side of the protesters, counseling kid-gloves treatment by the authorities, because he aims to maintain links with the community. Khamenei counsels the iron fist method because he wants to prolong the political status quo.



Cash Shortage Squeezes Gaza Residents

Palestinian children queue for a hot meal at a charity kitchen in Gaza City on April 30, 2025. (Photo by Omar AL-QATTAA / AFP)
Palestinian children queue for a hot meal at a charity kitchen in Gaza City on April 30, 2025. (Photo by Omar AL-QATTAA / AFP)
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Cash Shortage Squeezes Gaza Residents

Palestinian children queue for a hot meal at a charity kitchen in Gaza City on April 30, 2025. (Photo by Omar AL-QATTAA / AFP)
Palestinian children queue for a hot meal at a charity kitchen in Gaza City on April 30, 2025. (Photo by Omar AL-QATTAA / AFP)

Even when food is available, many in Gaza cannot afford to buy it, as the enclave suffers from a severe cash shortage. Israel has blocked the entry of new currency into the territory since October 7, 2023, leaving residents at the mercy of money changers who have hiked exchange rates on remittances to exorbitant levels.

Palestinians in Gaza primarily rely on the Israeli shekel for daily transactions, which used to enter the strip through banks operating under the Palestinian Monetary Authority, supplied by the Bank of Israel.

Banking operations in Gaza have ground to a halt since the start of the war, and no fresh banknotes have entered the enclave, worsening an already dire humanitarian situation. Residents say they have been left at the mercy of traders who exploit the cash shortage to impose arbitrary rules on currency use.

'The Traders’ Game'

Dubbed “the traders’ game” by many in Gaza, the practice began with merchants refusing to accept worn-out banknotes and certain coins, such as the 10-shekel piece (worth about $3), which have all but vanished from local markets. Some vendors now reject older versions of bills - like the brown-hued 100-shekel note (around $28) - insisting instead on the newer yellow ones. The same rules apply to various denominations.

Speaking to Asharq Al-Awsat, Hani Jahjouh, a resident of al-Shati Camp west of Gaza City, said vendors selling vegetables and essential goods - when available - often refuse worn banknotes or specific coins, claiming they are counterfeit or easily faked.

“This just adds to the burden of people already crushed by impossible living conditions,” said Jahjouh, 59. “We don’t have solutions. We don’t even know where to get the money they’re asking for.”

Only a very small number of traders accept digital payments, and even then, residents say, they impose tough conditions - such as inflated prices or demands for partial payment in cash.

Displaced Gazan Duaa Ismail, originally from Beit Hanoun in the north of the enclave, says even when goods are available, she cannot afford them due to a lack of cash.

“We’re suffering badly from a shortage of money, and that makes it even harder to get basic items like flour and sugar - when they’re even in stock,” she told Asharq Al-Awsat from a shelter in Gaza City’s Sheikh Radwan neighborhood.

Ismail said that during a brief ceasefire, some traders had accepted digital payments through mobile apps. “But once the war resumed, things worsened, and they stopped taking them altogether,” she said.

Salaries They Can’t Spend

The crisis has also hit public-sector employees, private workers, and international aid staff, many of whom receive salaries through bank transfers or mobile wallets but have no way of accessing their funds with banks shuttered. They are forced to rely on currency dealers or traders with access to physical cash.

Amjad Hasballah, an employee with the Palestinian Authority, said he has been cashing his monthly salary through mobile banking apps for over a year and a half, paying a steep commission to money traders in return.

“When I received my last salary in early April, the commission had reached 30%,” he said.

Speaking to Asharq Al-Awsat, Hasballah explained that at the start of the war, commissions hovered around 5%, but they spiked during Ramadan, peaking at 35% around Eid al-Fitr, before dipping slightly to 30%.

“My salary is just 2,800 shekels. When I pay a 30% fee, there’s barely anything left,” he said bitterly. “At this point, the traders might as well take the whole salary and just give us pocket money.”

Caught in a Trap

Jamal Al-Mashal, a father of six who lost two children in an Israeli airstrike, said he lives off 1,000 shekels (about $280) in monthly international aid. But even that amount is slashed by up to 30% when he exchanges it through local traders.

“People in Gaza have become a cash trap for currency dealers and big traders,” he said. “They’re exploiting our desperation, and it’s like a harvest season for them - raking in profits while we suffer.”

The poorest and most vulnerable are hit hardest. Many international agencies rely on electronic payment platforms to distribute aid to these groups, who often have no access to physical currency.

No Oversight, No Restraint

The Hamas-run government has made attempts to cap commission rates at 5%, but those efforts have largely failed. Officials blame ongoing Israeli targeting of personnel involved in regulating the process.

Money changers defend the high fees, arguing that the lack of currency entering Gaza leaves them with limited options.

“We raise commission rates because there’s simply no new cash coming in,” one trader told Asharq Al-Awsat. “Once money is distributed to the public, we have no way of getting it back. What goes out doesn’t return.”

He added that while ministries and law enforcement have tried to impose limits, traders view the rules as unfair. “There have been attempts to regulate us, but we haven’t complied - they’re asking too much from us under impossible conditions,” he said.

Some municipal leaders and community elders in Gaza have recently appealed to the Palestinian Monetary Authority in Ramallah to intervene in what they describe as unchecked profiteering by traders controlling access to scarce cash.

They have called for greater oversight, including monitoring and freezing the traders’ bank accounts.

The authority has repeatedly warned against exploitation of civilians and threatened to take action. But in practice, traders continue to charge hefty commissions on money transfers with little deterrence.

The Authority has urged residents to use its Instant Payment System available through mobile banking apps, which it says offers a practical alternative to cash, promotes digital payments, and enables real-time transactions.

Cash Squeeze Tightens Further

Despite the hardship, Israel is considering new measures that could further tighten the financial stranglehold on Gaza. One proposal involves withdrawing the 200-shekel banknote (worth about $55) from circulation, on the grounds that Hamas allegedly uses it to pay salaries to its fighters.

The suggestion was reportedly made by Israeli Foreign Minister Gideon Sa’ar to Bank of Israel Governor Amir Yaron, who rejected the move. Other proposals include voiding the serial numbers of banknotes believed to be inside Gaza, effectively rendering them worthless, a step that could deliver a significant financial blow to Hamas.

According to a report published Tuesday by the Israeli daily Maariv, the proposal has backing from several ministers and economists both within and outside the central bank.

The report estimated that around 10 billion shekels in high-denomination bills - 100 and 200 shekels - remain in circulation within Gaza. These notes entered the enclave over the years through official banking channels supplied by the Bank of Israel.

Economists told Maariv that Gaza residents receive an estimated 150 to 200 million shekels each month through digital transfers from aid organizations and the Palestinian Authority. That money is then converted into cash within markets dominated by Hamas and supported by a network of money changers.

Israeli security sources estimate that Hamas has accumulated up to five billion shekels since the war began and has spent nearly one billion shekels on salaries for fighters and new recruits. The sources claim Hamas has profited significantly by reselling aid and fuel at inflated prices during the conflict.