THE THIRD WAVE
of a full-fledged industrial revolution.” In June 1978 international bankers were still scrambling to lend billions at hair-thin interest rates to the Persian Gulf Shipbuilding Corporation, to the Mazadern Textile Company, to Tavanir, the state-owned power utility, to the steel complex at Isfahan and the Iran Aluminium Company, among others.
While this buildup was supposedly turning Iran into a “modern” nation, however, corruption ruled Teheran. Conspicuous consumption aggravated the contrast between rich and poor. Foreign interests— mainly, but not exclusively, American—had a field day. (A German manager in Teheran was paid a third more than he could have earned at home, but his employees worked for one tenth a German worker’s pay-packet.) The urban middle class existed as a tiny island within a sea of misery. Apart from oil, fully two thirds of all the goods produced for the market were consumed in Teheran by one tenth the country’s population. In the countryside, where income was barely a fifth of that in the city, the rural masses continued to live under revolting and repressive conditions.
Nurtured by the West, attempting to apply the Second Wave strategy, the millionaires, generals, and hired technocrats who ran the Teheran government conceived of development as a basically economic process. Religion, culture, family life, sexual roles—all these would take care of themselves if only the dollar signs were got right. Cultural authenticity meant little because, steeped in indust-reality, they saw the world as increasingly standardized rather than moving toward diversity. Resistance to Western ideas was simply dismissed as “backward” by a cabinet 90 percent of whose members had been educated at Harvard, Berkeley, or European universities.
Despite certain unique circumstances—like the combustive mixture of oil and Islam—much of what happened in Iran was common to other countries pursuing the Second Wave strategy. With some variation, much the same might be said of dozens of other poverty-stricken societies from Asia and Africa to Latin America.
The collapse of the Shah’s regime in Teheran has sparked a widespread debate in other capitals from Manila to Mexico City. One frequently asked question has to do with the pace of change. Was the pace too accelerated? Did the Iranians suffer from future shock? Even with oil revenues, can governments create a large enough middle class rapidly enough to
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