War has shifted how power works in Iran

When Washington unveiled its economic “D-Day” on August 19, the latest tightening of the financial siege and the blockade around Iran’s ports, it believed it was applying decisive leverage. But in Tehran the move was read as something else entirely – as confirmation that the US still prefers pressure to any settlement it might one day have to honour. Across a political system that agrees on almost nothing, the interpretation was remarkably uniform. The economic stabilisers around the Iranian president, Masoud Pezeshkian, saw the US as reneging on a deal, while Ahmad Vahidi’s Islamic Revolutionary Guard Corps (IRGC) commanders saw their own warnings about American perfidy vindicated. So whatever faith remained in Iran about US willingness to close a deal has thinned further. That erosion of trust now shapes what Tehran will and will not accept. It is important to realise that Iran is making existential decisions about the survival strategy of the Islamic Republic itself. The old vocabulary of reformist against principlist – or moderate against hardliner – no longer reflects the real struggle inside the system. The contest that matters runs between those who believe the Islamic Republic survives best by converting its wartime leverage into economic and diplomatic gains and those who believe survival depends instead on permanent confrontation. Both camps are loyal to the regime, and both argue in good faith about how to keep it alive. That makes the debate far harder to resolve. It is also a debate with no single arbiter, because Iran today is best understood as a network state. Power runs through a decentralised structure that is horizontal in the way it is organised. The vertical hierarchy once associated with the former supreme leader Ali Khamenei has quietly dissolved. His son Mojtaba Khamenei sits at the formal apex and shapes outcomes largely through appointments. He has installed Mohsen Rezaee, a founder member of the Islamic Revolutionary Guard Corps (IRGC), as his representative on the supreme national security council. He is also rebuilding the Bayt – the office of the supreme leader that has long been the system’s true centre of gravity – around loyalists such as his new chief of staff, Mahdi Khamoushi. Yet Mojtaba rules as a balancer rather than a decider, careful never to let any one node or hub dominate the system. Beneath him, authority is spread across the nodes of the security establishment. Rezaee coordinates strategy from the council, while Vahidi commands the military muscle, from the missile force to the naval pressure in the Strait of Hormuz. Parliamentary speaker, Mohammad Bagher Ghalibaf, brokers the relationship between parliament and the security men. Pezeshkian’s government shoulders the economy, and the foreign minister, Abbas Araghchi, handles the messages abroad. No single figure combines all of these functions in one pair of hands. Iran’s shifting power balance But this horizontal picture is shifting, because the war has centralised power even in a system built to disperse it. The longer the confrontation with Washington runs, the more the IRGC moves from being merely the strongest node toward becoming the effective decision-maker. The IRGC still cannot run the economy, conduct diplomacy and preserve clerical legitimacy all at once. This is why it governs through that coalition rather than in place of it. But a prolonged state of war is exactly the condition under which that necessity begins to erode, because all decisions become related to the conflict and how best to prevail. The current system in Iran and its position towards a negotiated deal out of the war exists on a spectrum. At one end stand the economic stabilisers around Pezeshkian and Araghchi. Their camp consider the prolonged stalemate untenable and want sanctions relief, the release of frozen assets, and an end to the blockade. Iran’s parliamentary speaker, Mohammad Bagher Ghalibaf (centre) and foreign minister, Abbas Araghchi (left): different political factions but both aim at a negotiated settlement with the US. Hamed Malekpour/Middle East Images/StringersHub/Sipa USA Next come the pragmatic sovereigntists led by Ghalibaf and Rezaei – regime insiders who see diplomacy as the only way out, but not when it comes at the expense of strategic autonomy. Their camp will accept negotiation only from a position of strength and insist that the missile programme and the regional network of proxies stay off the table entirely. Further along sit the security-first coercionists gathered around Vahidi and the IRGC, who view diplomacy as a tactical instrument at all times subordinate to military leverage. At the far end are the ideological rejectionists of the Paydari Front and Saeed Jalili’s network. These fundamentalists regard any agreement with Washington as a form of surrender. They function less as a governing bloc than as a spoiler capable of raising the political cost of any deal. A chance to talk It is misleading to mistake Iranian dissent for dysfunction, when in truth it is neither. Here is a system arguing with itself about existential questions of statecraft. What is striking about the country now is not the depth of the disagreement but the extent to which the factions agree on the fundamentals. The spectrum has, without ever announcing it, largely agreed that some form of negotiation is the way out of the crisis. The stabilisers want a deal to rescue the economy. The sovereigntists want one to bank the gains of the war. Even the IRGC appear to want a channel of its own, as recent reports about the Trump administration relaying messages via Iraqi Kurdistan directly to the IRGC leadership suggest. The fight is therefore no longer about whether to bargain. It’s about the precise ways and means of improving Iran’s position before it commits to anything irreversible. Washington needs to understand that Iran has already begun to make its choice. Every US economic D-Day that reaches once more for the escalation trap strengthens the rejectionists who insist that confrontation with the US and Israel is permanent. It weakens the factions that have, against considerable odds, talked the system toward the negotiating table. By seeking to talk to the IRGC, Donald Trump has shown he understands he has a unique opportunity to get out of this self-inflicted quagmire. But he must not allow his ego to stand in the way of the mediators’ arduous efforts.