Statements of the Supreme Leader of the Islamic Revolution in Meeting with Economic Officials and Executors of Article 44

In the Name of God, the Most Gracious, the Most Merciful

First of all, I welcome all dear brothers. Thanks be to God, everyone is present; the activists, policymakers, and those involved in the economic sphere. I will begin my remarks without preamble.

On the first of Khordad in the year 1384 (May 22, 2005), the general policies of Article 44 - with the exception of clause "C" of these policies - were communicated. About a year later, on 11/4/85 (July 2, 2006), clause "C" of these policies, which pertains to the transfer of state-owned enterprises to the private and cooperative sectors, was also communicated. The day after that, in response to a letter from the esteemed President, the permission for the transfer of a percentage of the shares of the enterprises mentioned in clause "C" to a collection designated as "Justice Shares" to be distributed among certain groups of society was communicated.

Since our last communication - that is, 12/4/85 (July 3, 2006) - many months have passed, and from the date of the first communication, that is, the first of Khordad 84 (May 22, 2005) until today, more than a year and a half has passed. The progress in this regard is not satisfactory. I explicitly told the esteemed heads of the three branches about this one or two months ago; I also convey this to you, who are responsible for the various sectors of progress in this matter. Now, why is this progress not good? Either because the necessary attention to the importance of these policies and what was envisioned behind the communication of these policies - that is, a significant economic transformation in the country and its dimensions - has not been given; or because there are various interpretations of the issue. Each individual in different agencies or even within the same agency has different understandings of the clauses of these policies and their objectives and the results that should arise from the implementation of these policies; there is no unified understanding or interpretation.

This session is for the purpose of explicitly conveying the importance of this work from our perspective to you, dear brothers; to create a common understanding and interpretation so that diverse preferences do not obstruct this very important, necessary, and vital action.

Brothers! The outcome of our session should be that we must make changes in our perspectives regarding the country's economy, in our behaviors, and in our organizational and administrative structures, our laws, and our established rules, as well as the roles and shares that each of the agencies have, and we must shape our future based on this policymaking and these policies. This is among the absolute duties of all the agencies of the country. The budget must be formulated and approved based on these policies; economic activities outside the budget must be organized according to these policies. In this regard, the Parliament, the government, and the judiciary have very important duties that must be fulfilled.

First, we need to clarify; we must present the motivations behind these policies. When we look at our situation, we see that the transformations that arose from the Islamic Revolution in our country are very significant and profound; in cultural, political, and social fields, in affirming national identity, these transformations are 180-degree changes and are very deep. With the statements and claims made by our enemies and some of our inattentive friends, what has been achieved is not diminished; it is much greater than these claims. However, I explicitly state that the transformations that have taken place in the economic sphere are not commensurate with the transformations in other areas. We should have been able to present a successful model of the economy to the world.

In summary, we should have demonstrated both efficiency in promoting economic growth and efficiency in ensuring justice to the world. Of course, we do not want to deny the important works that have been done and that we know of; significant work has been accomplished, but we have certainly not reached the level we should have, and this is painful for us.

When we look at the Islamic economic framework on a macro level, we observe two main pillars. Any economic method, any recommendation or economic prescription that can secure these two pillars is valid. Any prescription, no matter how well-documented it may seem to religious sources, that cannot secure these two is not Islamic. One of these two pillars is "increasing national wealth." An Islamic country must be a wealthy country; it should not be a poor country; it must be able to advance its lofty goals on the international stage with its wealth and economic power. The second pillar is "fair distribution and alleviation of deprivation within the Islamic community." Both must be secured. The first is a condition for the second. If wealth is not produced; if added value in the country does not increase, we cannot eliminate deprivation; we will not be able to eradicate poverty. Therefore, both are necessary. You, who are economic thinkers and committed to Islamic principles, bring forth your proposals; these two must be secured in your proposal. If these two are not secured in that proposal, it has a flaw; it is defective.

In order to bring the country to a state of self-sufficiency and independence in terms of national wealth, investment and economic activity and wealth production must be accessible to all active individuals in the country; that is, everyone must be able to engage in this area. The government must support it; the law must support it. A vast number of young, educated, and capable managers - who, thanks be to God, we have many of both educated youth and capable managers in our country - must be able to take on large projects and entrepreneurial and wealth-generating activities of the country; they must be able to implement and advance them; they must be able to. The country is strong in terms of material resources and human resources. Up to this point, I do not think anyone can present a contrary opinion based on Islamic viewpoints.

The authors of the Constitution and Article 44 were both intelligent and fair, in my opinion. We had worked closely with most of them. In the product of their work, which is Article 44, Article 43, and so on, it is clear that they were both intelligent people and fair people. They recognized what they saw as generally correct as the middle ground between capitalist and socialist economies and framed it within the three main axes of ownership in Article 44. They categorized state-owned exclusive ownership, cooperative ownership, and private ownership. Then, they set a few conditions for this categorization. One of the conditions is that this categorization with these instances - which I have mentioned - must lead to economic growth and development; it must not be detrimental. That is, if one day the country's officials determine that this categorization is detrimental; that it does not lead to economic growth, this law will no longer be valid in that day and will be adjusted in a way that aligns with the public interest. This reflects their intelligence and fairness.

In the first decade of the revolution, due to the issues of the Sacred Defense and the war and various difficulties and strange economic blockades, we took actions that led to extensive state ownership; more than what was mentioned in this constitutional article. Of course, even at that time, there were many points to discuss. I myself was the President during a significant part of that period and had numerous discussions with the economic officials of the government and the head of the government, but nevertheless, the necessities imposed these issues on them and the country, and state ownership expanded beyond what was envisioned in Article 44. However, in the second and third decades, that is, after the war until today, we should not have agreed to the expansion of unnecessary state companies - there are several thousand state companies, many of which were truly unnecessary - that is, their formation by the government, or the failure to transfer the enterprises under Article 44 to the people, was not in accordance with the public interest.

One of the duties that we had in Article 44 and based on the law that we had approved in the Revolutionary Council was that the enterprises not covered by the first part of Article 44 should be entirely transferred to the people. There, we also had a resolution and a law that had clauses "A," "B," "C," and "D." Clause "C" pertained to companies and enterprises that were indebted to the government from the previous regime. It was stipulated that once they paid their debts, the company would be given to them, but this was not done. I remember that at the beginning of my presidency, I think I objected to the committee that connected the companies of clause "C" to those covered by clause "B" - clause "B" was a number of companies that should be under government control - based on the Constitution.

Even if necessities required this action at that time, such actions should not have been taken in the post-war period, in the second and third decades; unnecessary companies should not have been formed; there should not have been any shortcomings in transferring state companies to the people in the areas that the Constitution explicitly stated; we should have given them. We should have reduced state ownership day by day. This did not happen; rather, it increased and expanded! And many of the revenues that should have been utilized for production, for the proper circulation of money in society, were spent on unnecessary activities; extravagant activities, unnecessary constructions. And certainly, the economy of the country was harmed. In any case, these actions should not have been taken in these two decades. The current reality is this: the vast scope of state ownership is sometimes contrary to the existing text of Article 44, and many are contrary to the condition mentioned in Article 44.

The vision document has set goals that we have seen with this situation, we will not reach the vision document and its goals. Investments must be made that, according to calculations made, their growth should be around twelve percent per year. This is a very high figure. It has been calculated that in the oil sector alone, we need to invest 170 billion dollars over the next ten years; that is, 17 billion per year. Can the government carry out this investment? This is beyond the government's capacity. In addition to all this, the government has heavy responsibilities in strategic areas, in new activities, and extensive investments in advanced technologies. The tasks that the private sector naturally does not undertake must be carried out by the government, and the future of the country depends on these; like the nuclear issue.

On the other hand, the same concerns exist in the area related to justice - the issue of alleviating poverty and deprivation - as I previously mentioned. Of course, today if you look at the foreign propaganda - both their public propaganda and what they express in political and diplomatic dialogues, which may be available to some of you - you see they want to place the responsibility for this situation on the current government. This is incorrect; it is not like that, but it has gradually arisen over the years; no one has had ill intentions. The method was not correct, and it led to this situation.

All of these factors led us to consider the policies communicated in Article 44. Of course, from the time I told the Expediency Council to work on this issue - it seems to have been in 1999 or 2000 - until 2004 when we communicated it, several years passed. The communicated policies of Article 44 - these five clauses that we have included in these policies - can be summarized as follows: clause "A," clause "B," clause "C," clause "D," clause "E." Some of these clauses, like clause "A" or clause "D," are divided into two sections. The summary of these policies is the liberation of the government from unnecessary economic activities, opening the way for the genuine presence of investors in the country's economy, reliance on cooperatives - cooperative companies - and the broad umbrella of cooperative companies over the weak segments of society, the government's engagement in the etiquette and rules of governance, executive policymaking, and fulfilling the role of governance and the manner of utilizing the revenues generated from this transfer in the mentioned sectors, and then the government's obligations in the matter of transfer. This is the summary of the communicated policies of Article 44.

When the issue of Justice Shares was raised, we welcomed this action; we felt that providing at least the lower two deciles of society with a share in a productive and income-generating investment was a very important opportunity. We said these shares should be given with discounts and deferrals.

Of course, these policies, as I have explained, are clearly not meant to mean auctioning off state wealth; we absolutely do not wish and will not allow the state wealth, which belongs to the people, to be auctioned off and destroyed; no, this is about transforming this low-yield and ineffective or less effective asset into a highly effective and progressive asset for the country's economy, and of course alongside this, directing public wealth, that is, the public treasury, towards the deprived segments. In various sectors, some ambiguities have been introduced into people's minds, or they are introduced. Some have raised this with me and said that by communicating these policies, you will cause individuals to acquire large and heavy wealth; that with these economic activities, some will become wealthy. In response to them, I have said and now say that becoming wealthy through legal and legitimate means is not objectionable in Islam. We have never said that if someone engages in legal and legitimate activities and acquires wealth, it is undesirable from a religious perspective. No one has said this or will say it; those who know religion and the Quran.

Two things should not be mixed. One is wealth production. Someone engages in correct activities and produces wealth. The other is the manner of production and the manner of utilization. The first part of the matter is a desirable thing; because every wealth produced in society means the enrichment of the entire society. The second part, which is the sensitive part, is that the manner of production must be considered; it should not be through illegal means, using fraud and violations; its consumption should not be undesirable from a religious perspective; it should be able to flow like blood in the veins of society; it should not be spent on corruption. Consider this noble verse - Surah Qasas, the verses related to Qarun - Qarun is a complete example and an undesirable wealthy person from the perspective of Islam and the Quran and all. From the words of Qarun's people, (or the elders and the religious of the Children of Israel, or Prophet Moses) the Quran narrates; "His people said to him" - these words are not from ordinary and common people; therefore, these are credible statements; in addition to the fact that the Quran itself confirms these statements; that is, it expresses and affirms - that they say to him: "And seek by means of what Allah has given you the home of the Hereafter."; what God has given you, use it as a means to attain the Hereafter. In our narrations, it is also stated: "The world is a good helper for the Hereafter"; use this wealth to build your Hereafter.

The second recommendation: "And do not forget your share of the world"; do not forget your own share; you also have a share, a portion; we do not say do not benefit from this wealth; no, benefit from it; there is no obstacle.

Third: "And do good as Allah has done good to you"; God has given you this wealth; you should also be a means to deliver this wealth to those in need. That is, give a share of this to the people.

Fourth: "And do not seek corruption in the land"; do not create corruption. The scourge of wealth that must be prevented is the creation of corruption. Do not become extravagant. They do not say do not accumulate wealth, or do not use this wealth to increase it; or do not engage it in production and construction and trade; they say do not misuse it; make good use of this wealth, the best use is to build your Hereafter with it. Also have your share; also have your portion. This is the logic of Islam.

You have read in books, and you have heard a lot from preachers and speakers that Amir al-Mu'minin has many endowments. He said: "There is no endowment except in ownership." Someone who is not an owner cannot endow. These endowments were the properties of Amir al-Mu'minin. Amir al-Mu'minin did not inherit these properties; he produced them through his own work. In that situation of water scarcity, Amir al-Mu'minin dug wells, brought out water, created farms, developed them, and then endowed them. Some of Amir al-Mu'minin's endowments have lasted for centuries. It is evident that they were rooted and significant things. In any case, wealth production is a good thing. If in this wealth production, the intention is to spend it for good deeds, for the advancement of the country, for helping the deprived, it is also a good deed, it has reward.

If someone asks me whether it is better for someone to produce wealth to bring twenty or a hundred people whose lives are filled with deprivation to comfort, or for example, let’s say fifty people who live in a certain city and are longing to visit the holy grave of Ali ibn Musa al-Ridha and have not been able to go, to take them to visit with his wealth, or to go for Umrah for ten consecutive years with the same money he wants to use to produce wealth, I would undoubtedly and without any doubt say the former is preferable. Now, he may not go for Umrah every year. Wealth production in itself is commendable; if it is with the intention of helping, then it has divine reward; it has heavenly and afterlife reward.

Our people are charitable. This reality should not be overlooked. It is not just now; it has always been like this, and now it is even more so. This school-building movement - charitable school builders - as long as the way is opened for people to come and help, you see how much people contribute. This movement of building clinics and hospitals that started before the revolution in Mashhad; now perhaps the best hospital in Mashhad or one of the best hospitals in Mashhad is the one managed by these people's funds and these benefactors. It exists in other places too. Recently, a few months ago, some people from Shiraz came to me who had done very valuable and beneficial work in health and treatment, and we recommended that they share this with other places and carry it out. Our people are like this. These works can be done by charitable individuals, wealthy individuals. Here in Tehran, we had a hospital that was perhaps a reference for many of the injured from the protests; this hospital was run by benefactors. A number of benefactors carry out these works; they initiate them. Our people are like this; they are charitable. And those who now have endowments and all this endowment, all these works in the way of God, stem from the existence of wealthy individuals. We are not against this. Why should it be reflected outside that the Islamic system and the officials of the country frown upon anyone who wants to earn a little money; they feel animosity and hatred towards him. This is not the case; this is not the reality.

This objection, in our opinion, is not valid. One of our close and very good friends told me that they say these policies of Article 44 that you communicated will lead to the enrichment of individuals and the entry of capitalists into the field. I said we communicated these policies precisely for this purpose; so that they come into the field, invest, and engage in economic activities. Do they say it will happen this way?! We communicated it precisely for this to happen.

Some others have this ambiguity in their minds that you have talked so much about economic corruption and have been upset and have given orders, some of which have been implemented and some have not, now how do you say this? I say: Friends! If the fight against economic corruption is carried out with the same seriousness as I have mentioned, it will greatly assist in this economic activity and healthy economic vitality. These two are complementary.

A few years ago when I first spoke about economic corruption, some officials in their minds thought it might create problems. I said no, those who want to have healthy economic activities will be pleased that a number of swindlers, fraudsters, and lawbreakers are not in the field, do not block the paths, and do not defame them. We do not see these two as contradictory; rather, I see them as complementary; I believe that fighting corruption and eradicating corruption is a foundation for healthy economic competition and supports the policies of Article 44 that we communicated. Of course, to prevent corruption from infiltrating this work, there are requirements that the government, the Parliament, and the judiciary must adhere to. I will briefly mention them:

They must clarify regulations, shorten paths, and reduce administrative complexities. The fact that the authority for an economic activity suddenly returns to an official sitting behind a desk in a certain office, who can say yes or no, and determine the fate of a project is the greatest blow. This official is at risk; he is prone to temptation. We must ensure that this does not happen. Regulations, laws, and methods must be reformed and changed based on what is here.

I also want to emphasize to friends that this work, that is, the implementation of these policies, has opponents and enemies. Since it has enemies, then striving to implement these policies is a kind of jihad. Any effort that is in opposition to the enemies is a struggle, and in Islamic terminology, it is called jihad; if it is done with sincerity and correctly. Who are its enemies? Some opponents do not want these policies to be implemented, to alleviate the shortcomings. They do not want the Islamic system to have that flourishing and economic progress and economic prosperity. They have planned to exert economic pressure on the country. Foreigners are of this kind. Now see, just like a hungry wolf that is sitting and waiting for an opportunity to attack, they are waiting to be able to make an economic move. Of course, they are despondent about military and social action; they themselves say that we must exert economic pressure. They want to increase economic pressures. One of the things that can reduce these pressures or significantly lessen their impact is the implementation of these policies. They do not want these policies to be implemented. There may also be friends and supporters within the country. Some - which pertains to internal matters - have interests in the current situation; they are beneficiaries and do not want this situation to change. They value the ability of a manager, the circulation of a manager's pen, now in any place - whether in the executive branch, the judiciary, or the Parliament - to be able to shift many of these things, and they do not want it to disappear. Therefore, these are also part of the opponents. Now, there may be some who do not want the current government to be the one to undertake this great task. Of course, we assume this; we do not have certainty.

Now that the importance of this work has been clarified, what I am saying is that everyone has a duty in this regard. The reason I wanted to speak with friends was precisely to ensure that everyone pays attention to facilitating the implementation of this work in their respective sectors; both in the Parliament, laws and regulations must be drafted or changed, and in various sectors of the government, managers and officials must pay attention to this work and pursue it with seriousness, and also in the judiciary, where we requested in the meeting we had with the gentlemen that specialized courts be established to address these issues and defend individuals' property rights. Both in this area, specialized courts are necessary, and in the area related to economic corruption. In both cases, specialized sections and specialized courts are needed to ensure that those who are fully committed pursue the matter. In the government sectors, everyone must also be serious and act swiftly. Of course, when we say "swift action," we do not mean hasty action; swift action without haste. They should specify a timeframe and advance the work and report the results to higher officials. We have also formed a working group a few months ago to follow up on this issue in the three branches. Now, a commission has been formed in the Parliament for this work, and there is also a group in the government for this work. They must expedite the work. Speeding up the work does not contradict the fact that the work should not be done hastily; that is, they should conduct studies and properly assess the surroundings; consult with knowledgeable individuals. This is a duty that everyone must take seriously in their work.

Second, all sectors must consider all aspects of these policies. These policies range from clause "A" to clause "E." There are five clauses. Clause "A" itself has two sections: one section is liberating the government from the heavy burden of companies mentioned in Article 44; that is, those related to the first part of Article 44 that should free themselves from these burdens sooner. The other section allows the people, the private and cooperative sectors to invest in areas similar to the first part of Article 44. Clause "B" pertains to cooperatives and the characteristics related to cooperatives are mentioned in it. Clause "C" pertains to transfers; that is, the transfer of the same companies mentioned in the first part of Article 44; with a few exceptions. Several exceptions are mentioned there. Clause "D" also has two sections. One section pertains to requirements, which the government must fulfill to ensure that this transfer is carried out correctly and facilitated, and the private sector is encouraged to engage in this work; the other section pertains to the uses of the revenues that come to the government when they are transferred to the private or cooperative sectors. The last clause, which is clause "E," pertains to the government's governance policies. The government must maintain its governance policies, plan, make policies, guide, and in specific cases, invest, and focus on specific cases, such as what we have mentioned. All these clauses must be considered together. Otherwise, if we advance some of these clauses and forget some, this will create an imbalance and is not correct.

The third task that must be accomplished, which we have previously mentioned, is the clarification of regulations. Regulations must be clarified so that there is no room for justification, interpretation, or misinterpretation. The paths for fraud must be closed, and those who are prone to misuse the appearances of laws must be prevented.

Another necessary task is to inform the people. The people must be informed about the details of the work and know where they can engage in economic activities, where they can invest, and how they can enter a cooperative. Most people are unaware. Last year, when these policies were announced on television, some of the elites heard about it and were pleased; they were happy. Most of the people we saw were completely unaware of what the subject was! It must be explained to the people; it must be clarified; they must know how they can benefit from government assistance, what advantages the private sector can utilize, what support the government can provide to them, where they can enter and invest.

The next task is legislation, which we have mentioned that the Research Center of the Parliament and the relevant sections in the Parliament must truly address the necessary laws and prepare them; they must collaborate and coordinate with the government.

And the last point is the complete judicial support for legal ownership. In our opinion, if, God willing, our officials strive - as you are mostly gathered here and the esteemed heads of the three branches are fully aware of these views - God willing, within two or three years, we can see signs of correct movement and noticeable change in the country, and God willing, we will be more hopeful for the future.

Peace be upon you and God's mercy and blessings.