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Elite Revolutionary Guard's expanding role in Iran may limit U.S. options

"After the war, the Guard did not become a useless military machine, which would be of no use during peacetime," said the Guard's top commander, Maj. Gen. Mohammad Ali Jafari, in a September interview with the Jam-e Jam newspaper. "Today we are active in the fields that the revolution requires."

The Guard's construction garrison acts as a commercial company, but it is unclear what happens with its revenue. Commanders say the Guard income is transferred to the national treasury, but there are no public records that provide any amounts. Most of the group's contracts are carried out by its business divisions, which directly compete with private-sector firms.

The rise of the Guard

Iranian officials say they are undaunted by the threats of new sanctions. They point to four previous rounds of U.N. sanctions that have not proved very effective.

"U.S. sanctions will have no negative effect since the Guard organization is self-sufficient. Everything they need is here in Iran," Kazem Jalali, a member of the parliament's national security and foreign policy committee, said in an interview. "The Americans know that the Guard Corps is a defender of the values of the Islamic revolution. So the Americans aim to target its core."

The Guard's expansion into Iran's economy started in the early 1990s, when then-President Ali Akbar Hashemi Rafsanjani tried to jump-start private enterprise in the state-run economy by allowing state organizations to undertake commercial projects. The political rise of the Guard runs parallel with the ascendancy of the reformists in 1997. The movement called for more personal freedoms, fewer Islamic restrictions and a greater role for democracy. Political hard-liners turned to the Guard for more muscle in combating the reformists; in exchange, the Guard was given more influence in the economy and in politics.

In a November interview with the Ettemaad-e Melli newspaper, which is critical of the government, Guard commander Gen. Massoud Jazayeri said that the force could now "even compete with huge multinational and international companies" and added: "We don't want to receive an income but want to satisfy the people."

The result has been that the Guard controls a large part of Iran's economy, analysts say. "You can't see a single project above $10 million that is not executed by the Guard or one of their organizations," said Shamsolvaezin, the analyst. He warned that economic power could produce more demands for political power. "Some of our leaders now fear that [the Guard] will take everything into their hands."

Staff writer Glenn Kessler in Washington and special correspondent Kay Armin Serjoie in Tehran contributed to this report.

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