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Already some inadequacies in rapid economic growth—Iran's G.N.P. is currently expanding at an astounding rate of 50% a year—are becoming clear. The five-year plan by 1978 will create 2.1 million additional jobs. But there will be only 1.4 million Iranians qualified to fill them. That opens up the prospect of importing vast numbers of guest workers from other nations, as Western European powers do. Iranians are not sure they like the idea. There are sizable groups of foreigners in Iran already; the U.S. community, many members of which work on military-assistance programs (and who refer to the Shah as "Ralph" in conversations that his secret police might find critical, and thus un constitutional), is already 15,000 strong.
Last month the Shah decreed free and compulsory elementary school education throughout the country. The problem, however, is that Iran does not have enough teachers. One reasonably successful palliative up to now has been the creation of a "literacy corps" of high school graduates who spend most of their two-year military service teaching school. The corps has a program in which teachers travel with nomadic tribesmen and at each stop pitch a white school tent alongside the tribes' black goat-hair tents. The Shah also decided that each schoolchild should have a free daily glass of milk — an impossible task for the country's modest dairy industry. Even imported powdered milk would not improve the situation.
Iran's expanding economy, moreover, might easily be strangled by a tradition of bureaucratic bungling and red tape. Simply to retrieve an incoming airfreight package from Tehran's international airport requires 13 signatures from as many offices, a process that takes about three hours. A Tehran resident, complying with the law by paying an additional $1.20 tax assessment not long ago, had to try for nearly a month before he found the appropriate offices and could fill out the proper forms. "A thousand-rial [$13] bribe would have settled it in three minutes," he said bitterly.
One byproduct of such bureaucracy, as the Shah is aware, is corruption. Foreigners flocking to Iran to do business have discovered that even in the army, payoffs have been demanded. Only at the very top, apparently, is there total honesty. But crackdowns have begun. Wealthy Businessman Hussein Hamadanian was recently arrested by the secret police for embezzling from one of his companies and is awaiting trial. He faces a prison sentence of up to 10 years and may well receive the maximum penalty as a warning to others.