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                                                                              ╚January 7, 1980

Man of the Year:Ayatullah Khomeini

The Mystic Who Lit the Fires of Hatred



Iran's Ayatullah Khomeini seized his nation and shook all Islam

   The dour old man of 79 shuffles in his heel-less slippers
to the rooftop and waves apathetically to crowds that surround
his modest home in the holy city of Qum. The hooded eyes that
glare out so balefully from beneath his black turban are often
turned upward, as if seeking inspiration from on high -- which,
as a religious mystic, he indeed is. To Iran's Shi'ite Muslim
laity, he is the Imam, an ascetic spiritual leader whose
teachings are unquestioned. To hundreds of millions of others,
he is a fanatic whose judgments are harsh, reasoning bizarre
and conclusions surreal. He is learned in the ways of Shari'a
(Islamic law) and Platonic philosophy, yet astonishingly
ignorant of and indifferent to non-Muslim culture. Rarely has
so improbable a leader shaken the world.

   Yet in 1979 the lean figure of the Ayatullah Ruhollah
Khomeini towered malignly over the globe. As the leader of
Iran's revolution he gave the 20th century world a frightening
lesson in the shattering power of irrationality, of the ease
with which terrorism can be adopted as government policy. As the
new year neared, 50 of the American hostages seized on Nov. 4
by a mob of students were still inside the captured U.S.
embassy in Tehran, facing the prospect of being tried as spies
by Khomeini's revolutionary courts. The Ayatullah, who gave his
blessing to the capture, has made impossible and even insulting
demands for the hostages' release: that the U.S. return deposed
Shah Mohammed Reza Pahlavi to Iran for trial and no doubt
execution, even though the Shah is now in Panama; that America
submit to a trial of its "crimes" against Iran before an
international "grand jury" picked by Khomeini's aides. He
claimed that Iran had every legal and moral right to try
America's hostage diplomats, an action that would defy a
decision of the World Court, a vote of the U.N. Security Council
and one of the most basic rules of accommodation between
civilized nations. The Ayatullah even insisted, in an
extraordinary interview with TIME, that if Americans wish to
have good relations with Iran they must vote Jimmy Carter out
of office and elect instead a President that Khomeini would find
"suitable."

   Unifying a nation behind such extremist positions is a
remarkable achievement for an austere theologian who little
more than a year ago was totally unknown in the West he now
menaces. But Khomeini's carefully cultivated air of mystic
detachment cloaks an iron will, an inflexible devotion to
simple ideas that he has preached for decades, and a finely
tuned instinct of articulating the passions and rages of his
people. Khomeini is no politician in the Western sense, yet he
possesses the most awesome -- an ominous -- of political gifts:
the ability to rouse millions to both adulation and fury.

   Khomeini's importance far transcends the nightmare of the
embassy seizure, transcends indeed the overthrow of the Shah of
Iran. The revolution that he led to triumph threatens to upset
the world balance of power more than any political event since
Hitler's conquest of Europe. It was unique in several respects:
a successful, mostly nonviolent revolt against a seemingly
entrenched dictator, it owed nothing to outside help or even to
any Western ideology. The danger exists that the Iranian
revolution could become a model for future uprisings throughout
the Third World -- and not only its Islamic portion. Non-Muslim
nations too are likely to be attracted by the spectacle of a
rebellion aimed at expelling all foreign influence in the name
of xenophobic nationalism.

   Already the flames of anti-Western fanaticism that Khomeini
fanned in Iran threaten to spread through the volatile Soviet
Union, from the Indian subcontinent to Turkey and southward
through the Arabian Peninsula to the Horn of Africa. Most
particularly, the revolution that turned Iran into an Islamic
republic whose supreme law is the Koran is undermining the
stability of the Middle East, a region that supplies more than
half of the Western world's imported oil, a region that stands
at the strategic crossroads of super-power competition.

   As an immediate result, the U.S., Western Europe and Japan
face continuing inflation and rising unemployment, brought on,
in part, by a disruption of the oil trade. Beyond that looms the
danger of U.S.-Soviet confrontation. Washington policymakers,
uncertain about the leftist impulses of Iran's ubiquitous
"students" -- and perhaps some members of Iran's ruling
Revolutionary Council -- fear that the country may become a new
target of opportunity for Soviet adventurism. The Kremlin
leaders in turn must contend with the danger that the U.S.S.R.'s
50 million Muslims could be aroused by Khomeini's incendiary
Islamic nationalism. Yet if the Soviets chose to take advantage
of the turmoil in Iran as they have intervened in neighboring
Afghanistan, the U.S. would have to find some way of countering
such aggression.

   Khomeini thus poses to the U.S. a supreme test of both will
and strategy. So far his hostage blackmail has produced a result
he certainly did not intend: a surge of patriotism that has made
the American people more united than they have been on any issue
in two decades. The shock of seeing the U.S. flag burned on the
streets of Tehran, or misused by embassy attackers to carry
trash, has jolted the nation out of its self-doubting "Viet Nam
syndrome." Worries about America's ability to influence events
abroad are giving way to anger about impotence; the country now
seems willing to exert its power. But how can that power be
brought to bear against an opponent immune to the usual forms
of diplomatic, economic and even military pressure, and how can
it be refined to deal with others in the Third World who might
rise to follow Khomeini's example? That may be the central
problem for U.S. foreign policy throughout the 1980s.

   The outcome of the present turmoil on Iran is almost
totally unpredictable. It is unclear how much authority
Khomeini, or Iran's ever changing government, exerts over day-
to-day events. Much as Khomeini has capitalized on it, the
seizure of the U.S. embassy tilted the balance in Iran's murky
revolutionary politics from relative moderates to extremists
who sometimes seem to listen to no one; the militants at the
embassy openly sneer at government ministers, who regularly
contradict one another. The death of Khomeini, who has no
obvious successor, could plunge the country into anarchy.

   But one thing is certain: the world will not again look
quite the way it did before Feb. 1, 1979, the day on which
Khomeini flew back to a tumultuous welcome in Tehran after 15
years in exile. He thus joins a handful of other world figures
whose deeds are debatable -- or worse -- but who nonetheless
branded a year as their own. In 1979 the Ayatullah Ruhollah
Khomeini met TIME's definition of Man of the Year: he was the
one who "has done the most to change the news, for better or for
worse."

   Apart from Iran and its fallout, 1979 was a year of turmoil
highlighted by an occasional upbeat note: hopeful stirrings
that offset to a degree the continuing victories of the forces
of disruption. On a spectacular visit to his homeland of Poland
and the U.S., Ireland and Mexico, Pope John Paul II demonstrated
that he was a man whose warmth, dignity and radiant humanity
deeply affected even those who did not share his Roman Catholic
faith. Despite his rigidly orthodox approach to doctrinal
issues, the Pope's message of peace, love, justice and concern
for the poor stirred unprecedented feelings of brotherhood.

   The election of Conservative Party Leader Margaret Thatcher
as Prime Minister of Britain was perhaps the most notable sign
that many voters in Europe were disillusioned with statist
solutions and wanted a return to more conservative policies. At
year's end her government could claim one notable diplomatic
success. Under the skillful guidance of Thatcher's Foreign
Secretary, Lord Carrington, leaders of both the interim
Salisbury government and the Patriotic Front guerrillas signed
an agreement that promised -- precariously -- to end a seven-
year-old civil war and provide a peaceful transition to genuine
majority rule in Zimbabwe Rhodesia. There were other indications
of growing rationality in Africa, as three noxious dictators who
had transformed their nations into slaughterhouses fell from
power: Idi Amin was ousted from Uganda, Jean Bedal Bokassa from
the Central African Empire (now Republic), and Francisco Macias
Nguema from Equatorial Guinea.

   Southeast Asia, though, as it has for so long, endured a
year of war, cruelty and famine. Peking and Moscow jockeyed for
influence in the area. China briefly invaded Viet Nam and then
withdrew, achieving nothing but proving once again that
Communists have their own explosive quarrels. Hanoi's Soviet-
backed rulers expelled hundreds of thousands of its ethnic
Chinese citizens, many of whom drowned at sea; survivors landed
on the shores of nations that could not handle such onslaughts
of refugees. In Cambodia, the Vietnamese-backed regime of Heng
Samrin was proving little better than the maniacal Chinese-
supported dictatorship of Pol Pot that it had deposed. Hundreds
of thousands of Cambodians still faced death by starvation or
disease as the year ended, despite huge relief efforts organized
by the outside world.

   In the U.S., 1979 was a year of indecision and frustration.
Inflation galloped to an annual rate of 13% and stayed there,
all but impervious to attacks by the Carter Administration. The
burden of containing inflation eventually fell on the shoulders
of new Federal Reserve Chairman Paul Volcker. His tough fiscal
measures, including higher interest rates and a clampdown on
the money supply, do promise to restrain price boosts -- but
only after a distressing time lag, and at the cost of making
more severe a recession that the U.S. seemed headed for anyway
in 1980. President Carter's energy program at last began
staggering through Congress, but a near disaster at Three Mile
Island in Pennsylvania raised legitimate questions -- as well
as much unnecessary hysteria -- about how safe and useful
nuclear power will be as a partial substitute for the imported
oil that the eruption in Iran will help make ever more costly.
The conclusion of a SALT II agreement wit the Soviet Union --
more modest in scope than many Americans had urged, but
basically useful to the U.S. -- led to congressional wrangling
that raised doubts about whether the Strategic Arms Limitation
Treaty will even be ratified in 1980. The SALT debate put a
substantial strain on U.S.-Soviet relations, which were
deteriorating for lots of other reasons as well.

   For much of the year, Carter appeared so ineffective a
leader that his seeming weakness touched off an unprecedentedly
early and crowded scramble to succeed him. Ten Republicans
announced as candidates for the party's 1980 presidential
nomination; at year's end, however, the clear favorite was the
man who had done or said hardly anything, Ronald Reagan. On the
Democratic side, Senator Edward Kennedy overcame his
reservations and declared his candidacy, but early grass-roots
enthusiasm about his "leadership qualities" dissipated in the
face of his lackluster campaigning, his astonishing incoherence,
and his failure to stake out convincingly different positions
on the issues. At year's end Carter was looking much stronger,
primarily because his firm yet restrained response to Iran's
seizure of hostages led to a classic popular reaction: Let's
rally round the President in a crisis.

   None of these trends could match in power and drama, or in
menacing implications for the future, the eruption in Iran. A
year ago, in its cover story on 1978's Man of the Year, Chinese
Vice Premier Deng Xiaoping, TIME noted that "the Shah of Iran's
37-year reign was shaken by week upon week of riots." Shortly
thereafter, the Shah fell in one of the greatest political
upheavals of the post-World War II era, one that raised
troubling questions about the ability of the U.S. to guide or
even understand the seething passions of the Third World.

   Almost to the very end, the conventional wisdom of Western
diplomats and journalists was that the Shah would survive; after
all, he had come through earlier troubles seemingly
strengthened. In 1953 the Shah had actually fled the country.
But he was restored to power by a CIA-inspired coup that ousted
Mohammed Mossadegh, the nationalist Prime Minister who had been
TIME's Man of the Year for 1951 because he had "oiled the wheels
of chaos." In 1963 Iran had been swept by riots stirred up by
the powerful Islamic clergy against the Shah's White Revolution.
Among other things, this well-meant reform abolished the feudal
landlord-peasant system. Two consequences: the reform broke up
properties administered by the Shi'ite clergy and reduced their
income, some of which consisted of donations from large
landholders. The White Revolution also gave the vote to women.
The Shah suppressed those disturbances without outside help, in
part by jailing one of the instigators -- an ascetic theologian
named Ruhollah Khomeini, who had recently attained the title of
Ayatullah and drawn crowds to fiery sermons in which he
denounced the land reform as a fraud and the Shah as a traitor
to Islam. (An appellation that means "sign of God." There is no
formal procedure for bestowing it; a religious leader is called
ayatullah by a large number of reverent followers and is
accepted as such by the rest of the Iranian clergy. At present,
Iran has perhaps 50 to 60 mullahs generally regarded as
ayatullahs.) In 1964 Khomeini was arrested and exiled, first to
Turkey, then to Iraq, where he continued to preach against the
idolatrous Shah and to promulgate his vision of Iran as an
"Islamic republic."

   The preachments seemed to have little effect, as the Shah
set about building the most thoroughly Westernized nation in all
of the Muslim world. The progress achieved in a deeply backward
country was stunning. Petroleum revenues built steel mills,
nuclear power plants, telecommunication systems and a formidable
military machine, complete with U.S. supersonic fighters and
missiles. Dissent was ruthlessly suppressed, in part by the use
of torture in the dungeons of SAVAK, the secret police. It is
still not clear how widespread the tortures and political
executions were; but the Shah did not heed U.S. advice to
liberalize his regime, and repression inflamed rather than
quieted dissent.

   By 1978 the Shah had alienated almost all elements of
Iranian society. Westernized intellectuals were infuriated by
rampant corruption and repression; workers and peasants by the
selective prosperity that raised glittering apartments for the
rich while the poor remained in mud hovels; bazaar merchants by
the Shah-supported businessmen who monopolized bank credits,
supply contracts and imports; the clergy and their pious Muslim
followers by the gambling casinos, bars and discotheques that
seemed the most visible result of Westernization. (One of the
Shah's last prime ministers also stopped annual government
subsidies to the mullahs.) Almost everybody hated the police
terror and sneered in private at the Shah's Ozymandian
megalomania, symbolized by a $100 million fete he staged at
Persepolis in 1971 to celebrate the 2,500 years of the Persian
Empire. In fact, the Shah's father was a colonel in the army
when he overthrew the Qajar dynasty in 1925, and as Khomeini
pointed out angrily from exile at the time of the Persepolis
festival, famine was raging in that part of the country.

   But the U.S. saw the Shah as a stable and valuable ally.
Washington was annoyed by the Shah's insistence on raising oil
prices at every OPEC meeting, yet that irritation was outweighed
by the fact that the Shah was staunchly anti-Communist and a
valuable balance wheel in Middle East politics. Eager to build
up Iran as a "regional influential" that could act as America's
surrogate policeman of the Persian Gulf, the U.S. lent the Shah
its all-out support. President Richard Nixon and Secretary of
State Henry Kissinger allowed him to buy all the modern weapons
he wanted. Washington also gave its blessing to a flood of
American business investment in Iran and dispatched an army of
technocrats there.

   The depth of its commitment to the Shah apparently blinded
Washington to the growing discontent. U.S. policymakers wanted
to believe that their investment was buying stability and
friendship; they trusted what they heard from the monarch, who
dismissed all opposition as "the blah-blahs of armchair
critics." Even after the revolution began, U.S. officials were
convinced that "there is no alternative to the Shah." Carter
took time out from the Camp David summit in September 1978 to
phone the Iranian monarch and assure him of Washington's
continued support.

   By then it was too late. Demonstrations and protest marches
that started as a genuine popular outbreak grew by a kind of
spontaneous combustion. The first parades drew fire from the
Shah's troops, who killed scores and started a deadly cycle:
marches to mourn the victims of the first riot, more shooting,
more martyrs, crowds swelling into the hundreds of thousands and
eventually millions in Tehran. Khomeini at this point was
primarily a symbol of the revolution, which at the outset had
no visible leaders. But even in exile the Ayatullah was well
known inside Iran for his uncompromising insistence that the
Shah must go. When demonstrators began waving the Ayatullah's
picture, the frightened Shah pressured Iraq to boot Khomeini
out. It was a fatal blunder; in October 1978 the Ayatullah
settled in Neauphle-le-Chateau, outside Paris, where he gathered
a circle of exiles and for the first time publicized his views
through the Western press.

   Khomeini now became the active head of the revolution.
Cassettes of his anti-Shah sermons sold like pop records in the
bazaars and were played in crowded mosques throughout the
country. When he called for strikes, his followers shut down the
banks, the postal service, the factories, the food stores and,
most important, the oil wells, bringing the country close to
paralysis. The Shah imposed martial law, but to no avail. On
Jan. 16, after weeks of daily protest parades, the Shah and his
Empress flew off to exile, leaving a "regency council" that
included Prime Minister Shahpour Bakhtiar, a moderate who had
spent time in the Shah's prisons. But Khomeini announced that
no one ruling in the Shah's name would be acceptable, and Iran
was torn by the largest riots of the entire revolution. The
Ayatullah returned from Paris to a tumultuous welcome and
Bakhtiar fled. "The holy one has come!" the crowds greeting
Khomeini shouted triumphantly. "He is the light of our lives!"
The crush stalled the Ayatullah's motorcade, so that he had to
be lifted out of the crowds, over the heads of his adulators,
by helicopter. He was flown to a cemetery, where he prayed at
the graves of those who had died during the revolution.

   Khomeini withdrew to the holy city of Qum, appointed a
government headed by Mehdi Bazargan, an engineer by training and
veteran of Mossadegh's Cabinet, and announced that he would
confine his own role during "the one or two years left to me"
to making sure that Iran followed "in the image of Muhammad." It
quickly became apparent that real power resided in the
revolutionary komitehs that sprang up all over the country, and
the komitehs took orders only from the 15-man Revolutionary
Council headed by Khomeini (the names of its other members were
long kept secret). Bazargan and his Cabinet had to trek to Qum
for weekly lunches with Khomeini to find out what the Ayatullah
would or would not allow.

   Some observers distinguish two stages in the entire upheaval:
the first a popular revolt that overthrew the Shah, then a
"Khomeini coup" that concentrated all power in the clergy. The
Ayatullah's main instrument was a stream of elamiehs
(directives) from Qum, many issued without consulting Bazargan's
nominal government. Banks and heavy industry were nationalized
and turned over to government managers. Many of the elamiehs
were concerned with imposing a strict Islamic way of life on all
Iranians. Alcohol was forbidden. Women were segregated from men
in schools below the university level, at swimming pools,
beaches and other public facilities. Khomeini even banned most
music from radio and TV. Marches were acceptable, he told
Italian Journalist Oriana Fallaci, but other Western music
"dulls the mind, because it involves pleasure and ecstasy,
similar to drugs." Fallaci: "Even the music of Bach, Beethoven,
Verdi?" Khomeini: "I do not know those names."

   In power, Khomeini and his followers displayed a
retaliatory streak. Islamic revolutionary courts condemned more
than 650 Iranians to death, after trials at which defense
lawyers were rarely, if ever, present, and spectators stepped
forward to add their own accusations to those of the
prosecutors; death sentences were generally carried out
immediately by firing squad. An unknown but apparently large
number of other Iranians were sentenced to life imprisonment.
Khomeini preaches the mercy of God but showed little of his own
to those executed, who were, he said, torturers and killers of
the Shah's who got what they deserved. Some were, including the
generals and highest-ranking politicians, but the victims also
included at least seven prostitutes, 15 men accused of
homosexual rape, and a Jewish businessman alleged to be spying
for Israel. Defenders of Khomeini's regime argue with some
justification that far fewer people were condemned by the
revolutionary courts than were tortured to death by the Shah's
SAVAK, and that the swift trials were necessary to defuse public
anger against the minions of the deposed monarch.

   As usually happens in revolutions, the forces of
dissolution, once let loose, are not so easily tamed. Iran's
economy suffered deeply, and unrest in at least three ethnic
areas -- those of the Kurds, the Azerbaijanis and the Baluchis
-- presented continuing threats to Tehran's, or Qum's, control.
Many Western experts believe Khomeini shrewdly seized upon the
students' attack on the U.S. embassy, which he applauded but
claims he did not order, as a way of directing popular attention
away from the country's increasing problems. It gave him once
again a means of presenting all difficulties as having been
caused by the U.S., to brand all his opponents -- believers in
parliamentary government, ethnic separatists, Muslims who
questioned his interpretations of Islamic law -- tools of the
CIA. When the United Nations and the World Court condemned the
seizure, he labeled these bodies stooges of the enemy. It was
Iran against the world -- indeed, all Islam against the
"infidels."

   When Bazargan resigned to protest the capture of the
hostages, the Ayatullah made the Revolutionary Council the
government in name as well as fact. Then, during the holy month
known as Muharram, with popular emotion at a frenzied height as
a result of the confrontation with the U.S., Khomeini expertly
managed a vote on a new constitution that turned Iran into a
theocracy. Approved overwhelmingly in a Dec. 2-3 referendum,
the constitution provided for an elected President and
parliament, but placed above them a "guardian council" of devout
Muslims to make sure that nothing the elected bodies do violates
Islamic law. Atop the structure is a faqih (literally,
jurisprudent), the leading theologian of Iran, who must approve
of the President, holds veto power over virtually every act of
government, and even commands the armed forces. Though the
constitution does not name him, when it goes fully into effect
after elections this month and in February, Khomeini obviously
will become the faqih.

   How did the Ayatullah capture a revolution that started out
as a leaderless explosion of resentment and hate? Primarily by
playing adroitly to, and in part embodying, some of the
psychological elements that made the revolt possible. There was,
for example, a widespread egalitarian yearning to end the
extremes of wealth and poverty that existed under the Shah --
and the rich could easily be tarred as clients of the "U.S.
imperialists." Partly because of the long history of Soviet,
British and then American meddling in their affairs, Iranians
were and are basically xenophobic, and thus susceptible to the
Ayatullah's charges that the U.S. (and, of course, the CIA) was
responsible for the country's ills. Iranians could also easily
accept that kind of falsehood since they had grown used to
living off gossip and rumor mills during the reign of the Shah,
when the heavily censored press played down even nonpolitical
bad news about Iran. When Khomeini declared that the Americans
and Israelis were responsible for the November attack by Muslim
fanatics in Mecca's Sacred Mosque, this deliberate lie was given
instant credence by multitudes of Iranians.

   By far the most powerful influence that cemented Khomeini's
hold on his country is the spirit of Shi'ism -- the branch of
Islam to which 93% of Iran's 35.2 million people belong. In
contrast to the dominant Sunni wing of Islam, Shi'ism emphasizes
martyrdom; thus many Iranians are receptive to Khomeini's
speeches about what a "joy" and "honor" it would be to die in
a war with the U.S. Beyond that, Shi'ism allows for the presence
of an intermediary between God and man. Originally, the
mediators were twelve imams, who Shi'ites believe were the
rightful successors of the Prophet Muhammad; the twelfth
disappeared in A.D. 940. He supposedly is in hiding, but will
return some day to purify the religion and institute God's reign
of justice on earth. This belief gives Shi'ism a strong
messianic cast, to which Khomeini appeals when he promises to
expel Western influence and to turn Iran into a pure Islamic
society. The Ayatullah has never claimed the title of Imam for
himself, but he has done nothing to discourage its use by his
followers, a fact that annoys some of his peers among the
Iranian clergy. Ayatullah Seyed Kazem Sharietmadari, Khomeini's
most potent rival for popular reverence, has acidly observed
that the Hidden Imam will indeed return, "but not in a Boeing
747" -- a reference to the plane that carried Khomeini from
France to Iran.

   Iran and Iraq are the main Muslim states where the majority
of the population is Shi'ite; but there are substantial Shi'ite
minorities in the Gulf states, Lebanon, Turkey and Saudi
Arabia. Khomeini's followers have been sending these Shi'ites
messages urging them to join in an uprising against Western
influence. The power of Khomeini's appeal for a "struggle
between Islam and the infidels" must not be underestimated. In
these and many other Islamic countries, Western technology and
education have strained the social structure and brought with
them trends that seem like paganism to devout Muslims. In
addition, Muslims have bitter memories of a century or more of
Western colonialism that kept most Islamic countries in
servitude until a generation ago, and they tend to see U.S.
support of Israel as a continuation of this "imperialist"
tradition.

   With Khomeini's encouragement, Muslims -- not all of them
Shi'ites -- have staged anti-American riots in Libya, India and
Bangladesh. In Islamabad, the capital of Pakistan, a mob burned
the U.S embassy and killed two U.S. servicemen; the Ayatullah's
reaction was "great joy." In Saudi Arabia, possessor of the
world's largest oil reserves, the vulnerability of the royal
family was made starkly apparent when a band of 200 to 300 well-
armed raiders in November seized the Sacred Mosque in Mecca, the
holiest of all Islamic shrines, which is under the protection
of King Khalid. The raiders appeared to have mixed religious and
political motives: they seemingly were armed and trained in
Marxist South Yemen, but were fundamentalists opposed to all
modernism, led by a zealot who had proclaimed the revolution in
Iran to be a "new dawn" for Islam. It took the Saudi army more
than a week to root them out from the catacomb-like basements
of the mosque, and 156 died in the fighting -- 82 raiders and
74 Saudi troopers. In addition, demonstrators waving Khomeini's
picture last month paraded in the oil towns of Saudi Arabia's
Eastern Province. Saudi troops apparently opened fire on the
protestors and at least 15 people are said to have died.

   Such rumblings have deeply shaken the nerves, if not yet
undermined the stability, of governments throughout the Middle
East. Leaders of the House of Saud regard Khomeini as an
outright menace. Egypt's President Anwar Sadat denounced
Khomeini as a man who is trying to play God and whose actions
are a "crime against Islam [and] and insult to humanity."
Nonetheless, the Ayatullah's appeal to Muslims, Sunni as well
as Shi'ite, is so strong the even pro-Western Islamic leaders
have been reluctant to give the U.S. more than minimal support
in the hostage crisis. They have explicitly warned Washington
that any U.S. military strike on Iran, even one undertaken in
retaliation for the killing of the hostages, would so enrage
their people as to threaten the security of every government in
the area.

   The appeal of Khomeini's Islamic fundamentalism to non-
Muslim nations in the Third World is limited. Not so the wave
of nationalism he unleashed in Iran. Warns William Quandt,
senior fellow at the Brookings Institution: "People in the Third
World were promised great gains upon independence [from
colonialism], and yet they still find their lives and societies
in a mess." Historically, such unfulfilled expectations prepare
the ground for revolution, and the outbreak in Iran offers an
example of an uprising that embodies a kind of nose-thumbing
national pride.

   Selig Harrison, senior associate at the Carnegie Endowment
for International Peace, says the overthrow of Iran's Shah "is
appealing to the Third World as a nationalist revolution that
has stood up to superpower influence. At the rational level,
Third World people know that you cannot behave like Khomeini
and they do not condone violation of diplomatic immunity. But
at the emotional level, mass public opinion in many Third World
countries is not unfriendly to what Khomeini has done. There is
an undercurrent of satisfaction in seeing a country stand up to
superpower influence."

   The Iranian revolution has also had a dramatic impact in
Western economies. 1979 was the year in which the world economy
moved from an era of recurrent oil surpluses into an age of
chronic shortages. Indeed, it was a year in which the frequent
warnings of pessimists that the industrial nations had made
themselves dangerously dependent on crude oil imported from
highly unstable countries came true with a vengeance. For more
than three centuries the industrial West had prospered thanks
partly to resources from colonies or quasi-colonies. Now a great
historical reversal was at hand.

   "If there had been no revolution in Iran," says John
Lichtblau, executive director of the Petroleum Industry Research
Foundation, "1979 would have been a normal year." The strikes
that accompanied the revolution shut off Iranian production
completely early in the year. Through output resumed in March,
it ran most of the time at no more than 3.5 million bbl. a day
-- little more than half the level under the Shah. Khomeini made
it clear that no more could be expected. In fact, Iranian output
has dropped again in recent months, to around 3.1 million bbl.
a day. Oil Minister Ali Akbar Moinfar says it will go down
further because "at the new price levels, Iran will be able to
produce and export less and still cover its revenue needs."

   The cutback in Iran reduced supplies to the non-Communist
world by about 4%. That was enough to produce a precarious
balance between world supply and demand. Spot shortages cropped
up, and the industrial West went through a kind of buyers'
panic; governments and companies scrambled to purchase every
drop available, to keep houses warm and the wheels of industry
turning, and to build stockpiles to guard against the all-to-
real prospect of another shutdown in Iran or a supply disruption
somewhere else.

   The lid came off prices with a bang. OPEC raised prices
during 1979 by an average of 94.7%, to $25 a bbl. -- vs. $12.84
a year ago and a mere $2 in 1970. Moreover, oil-exporting
nations shifted a growing proportion of their output to the spot
market, where oil not tied up under contract is sold for
whatever price buyers will pay. Before the Iranian revolution,
the spot market accounted for only 5% of the oil moving in world
trade, and prices differed little from OPEC's official ones.
During 1979, anywhere from 10% to 33% of internationally traded
crude bought by the industrial countries went through the spot
market, and prices shot as high as $45 a bbl.

   The runaway price rises will fan inflation in the U.S.,
Western Europe and Japan. Affected are not only the price of
gasoline and heating oil but also the cost of thousands of
products made from petrochemicals -- goods ranging from
fertilizers and laundry detergents to panty hose and phonograph
records. Oil price hikes will bear on apartment rents and the
price of food brought to stores by gasoline-burning trucks. The
price boosts act as a kind of gigantic tax, siphoning from the
pockets of consumers money that would otherwise be used to buy
non-oil goods and services, thus depressing production and
employment. In the U.S., which imports about half its oil, a
1980 recession that would increase unemployment might happen
anyway; the oil price increases have made it all but inevitable.

   At year's end OPEC had almost come apart; at their December
meeting in Caracas its members could not agree on any unified
pricing structure at all. So long as supply barely equals
demand, there will be leapfrogging price boosts; four countries
announced 10% to 15% price hikes last Friday. In the longer run,
the disunity could lead to price-cutting competition, but only
if the industrial countries, and especially the U.S., take more
drastic steps to conserve energy and reduce imports than any
they have instituted yet -- and even then OPEC might come back
together. It is presumably not in the cartel's economic or
political self-interest to bankrupt its major customers,
especially since many of OPEC's member states have invested
their excess profits in the West. Yet even moderate nations like
Saudi Arabia, which have fought to keep price boosts to a
minimum, argue that inflation price hikes will be necessary as
long as oil prices are tied to a declining dollar.

   A still greater danger is that the producers may not pump
enough oil to permit much or any economic growth in either the
industrial or underdeveloped worlds. The producers have learned
that prices rise most rapidly when supply is kept barely equal
to, or a bit below, demand; they have good reason to think that
oil kept in the ground will appreciate more than any other
asset, and the Iranian explosion has demonstrated that all-out
production, and the forced-draft industrialization and
Westernization that it finances, can lead not to stability but
to social strains so intense that they end in revolution. The
result of a production hold-down could be a decade or so of
serious economic stagnation. Oil Consultant Walter Levy sees
these potential gloomy consequences for the West: "A lower
standard of living, a reduction in gross national product, large
balance of payments drains, loss of value in currencies, high
unemployment."

   Warns Mobil Chairman Rawleigh Warner: "The West can no
longer assume that oil-exporting countries, and specifically
those in the Middle East, will be willing to tailor production
to demand. The safer assumptions is that the consuming countries
will increasingly have to tailor their demand to production. And
the factors that determine the ceiling in production are more
likely to be political than economic or technical."

   The West will be lucky if oil shortages are the worst
result of Khomeini's revolution. An even more menacing prospect
is a shift in the world balance of power toward the Soviet
Union.

   The Ayatullah is no friend of the Soviets. Far from it:
while in his mind "America is the great Satan," he knows, and
has often said, that Communism is incompatible with Islam.
Tehran mobs have occasionally chanted "Communism will die!" as
well as "Death to Carter!"

   Indeed, Islamic fundamentalism could become a domestic
worry to the Kremlin. Its estimated 50 million Muslims make the
Soviet Union the world's fifth largest Muslim state. (After
Indonesia (123.2 million), India (80 million), Pakistan (72.3
million) and Bangladesh (70.8 million).) For the Kremlin,
Muslims represent a demographic time bomb. By the year 2000,
there will be an estimated 100 million Soviet Muslims, vs. about
150 million ethnic Russians. Most of the Muslims live in areas
of Central Asia, bordering on Iran, that were subjugated by
czarist armies only a little more than a century ago --
Samarakand, for example, fell in 1868. The Soviets have soft-
pedaled antireligious propaganda and allowed the Muslims to
maintain mosques and theological schools. Consequently, the
Azerbaijanis, Turkmen and other Muslim minorities in the
U.S.S.R. could eventually become targets for Khomeini's
advocacy of an Islamic rebellion against all foreign domination
of Muslims.

   Yet Moscow can hardly ignore the opportunity presented by
Khomeini's rise. An Iran sliding into anarchy, and a Middle East
shaken by the furies of Khomeini's followers, would offer the
Soviets a chance to substitute their own influence for the
Western presence that the Ayatullah's admirers vow to expel. And
the Middle East is an unparalleled geopolitical prize.

   Whoever controls the Middle East's oil, or the area's
Strait of Hormuz (40 miles wide at its narrowest) between Iran
and the Sultanate of Oman through which most of it passes,
acquires a stranglehold on the world's economy. The U.S.S.R.
today is self-sufficient in oil, but it could well become a
major net importer in the 1980s -- and thus be in direct
competition with the West for the crude pumped out of the desert
sands. The warm-water ports so ardently desired by the Czars
since the 18th century retain almost as much importance today.
Soviet missile-firing submarines, for example, now have to leave
the ice-locked areas around Murmansk and Archangel through
narrow channels where they can easily be tracked by U.S.
antisubmarine forces. They would be much harder to detect if
they could slip out of ports on the Arabian Sea.

   The conflagration in Iran, and the threat of renewed
instability throughout the region, could open an entirely new
chapter in the story of Soviet efforts to infiltrate the Middle
East. So far, the Soviet leaders have played a double game in
the hostage crisis. Representatives of the U.S.S.R. voted in the
United Nations and World Court to free the hostages. At the same
time, to Washington's intense annoyance, the Soviets have
proclaimed sympathy for Iran's anger against the U.S. The
Kremlin apparently wants to keep lines open to Khomeini's
followers, if not to the Ayatullah himself, while it awaits its
chance.

   Meanwhile, Moscow has been acting more brazenly throughout
the entire region of crisis. Around Christmas, the U.S.S.R. began
airlifting combat troops into Afghanistan, reinforcing an
already strong Soviet presence. Last week the Soviet soldiers
participated in a coup ousting a pro-Moscow regime that had
proved hopelessly ineffective in trying to put down an
insurrection by anti-Communist Muslim tribesmen. At week's end,
Washington charged that Soviet troops had crossed the border in
Afghanistan in what appeared to be an outright invasion.

   Who or what follows Khomeini is already a popular guessing
game in Tehran, Washington and doubtless Moscow. Few of the
potential scenarios seem especially favorable to U.S. interests.
One possibility is a military coup, led by officers once loyal
to the Shah and now anxious to restore order. That might seem
unlikely in view of the disorganized state of the army and the
popular hatred of the old regime, but the danger apparently
seems significant to Khomeini; he is enthusiastically expanding
the Pasdaran militia as a counterweight to the official armed
forces. A military coup might conceivably win the backing of the
urban intelligentsia, which resents the theocracy and Washington
analysts think that even some mullahs might accommodate
themselves to it if they see no other way of blocking a leftist
takeover. Whether such an uneasy coalition could fashion a
stable regime is questionable.

   Another potential outcome is a takeover, swift or gradual,
by younger clergymen in alliance with such Western-educated
leaders as Foreign Minister Sadegh Ghotbzadeh. A government
composed of those forces would be less fanatical than the
Ayatullah but still very hard-line anti-U.S. Another
possibility, considered by some analysts to be the most likely,
would be an eventual confrontation between Khomeini's religious
establishment and members of the urban upper and middle classes,
who applaud the nationalistic goals of the revolution but chafe
under rigid enforcement of Islamic law -- and have the brains to
mount an effective opposition.

   A leftist takeover is the most worrisome prospect to
Washington policymakers. The Mujahedin (Islamic socialist) and
Fedayan (Marxist) movements maintain guerilla forces armed with
weapons seized from the Shah's garrisons during the revolution.
Both groups disclaim any ties with the U.S.S.R., and some
Iranian exiles believe a dialogue between them and moderate
forces would be possible. However, they are very anti-Western.
A third contender is the Tudeh (Communist) Party, which has a
reputation of loyally following Moscow's line. It is currently
voicing all-out support of Khomeini because, its leaders
disingenuously explain, any foe of America's imperialism is a
friend of theirs. In gratitude, the Ayatullah has permitted them
to operate openly.

   Any of these potential scenarios might draw support from
Iran's ethnic minorities, whose demands for cultural and
political autonomy -- local languages in schools, local
governing councils -- have been rebuffed so brusquely by
Khomeini's government as to trigger armed rebellion. Iran, a
country three times the size of France, was officially
designated an empire by the Shah, and in one sense it is; its
35.2 millon people are divided into many ethnic strains and
speak as many as 20 languages, not counting the dialects of
remote tribes. The 4 million Kurds, superb guerilla fighters who
live in the western mountains, have at times dreamed of an
independent Kurdistan, and today have set up what amounts to an
autonomous region. The Baluchis, a nomadic tribe of Sunni
Muslims, boycotted the referendum on the Iranian constitution,
which they viewed as an attempt to impose Shi'ism on them. The
13 million Azerbaijanis, a Turkic people, also boycotted the
constitutional referendum and in recent weeks have come close
to an open revolt that could tear Iran apart.

   Some Washington policy planners have toyed with the idea
of encouraging separatism, seeking the breakup of Iran as a kind
of ultimate sanction against Khomeini. But the hazards of doing
this far outweigh the advantages; true civil war in Iran would
be the quickest way of destroying whatever stability remains in
the Middle East. The lands of the Azerbaijanis stretch into
Turkey and the Soviet Union, those of the Kurds into Turkey and
Iraq, those of the Baluchis into Afghanistan and Pakistan.
Successful secessionist movements could tear away parts of some
of those countries as well as of Iran, leaving a number of weak
new countries -- the kind that usually tumble into social and
economic chaos -- and dismembered older ones. All might be
subject to Soviet penetration. Anarchy in Iran could also
trigger a conflict with its uneasy neighbor, Iraq, which shelled
border areas of Iran three weeks ago. The geopolitical stakes
there would be so great that the superpowers would be sorely
tempted to intervene.

   The options for U.S. policy toward Iran are limited. So
long as the hostages are in captivity, Washington must use every
possible form of diplomatic and economic pressure to get them
released. The Carter Administration has all but said that
military action may well be necessary if the hostages are
killed. But if they are released unharmed, many foreign policy
experts think that the U.S. would be well advised not to
retaliate for the seizure but simply to cut all ties with Iran
and ignore the country for awhile -- unless, of course, the
Soviets move in. Primarily because of the intimate U.S.
involvement with the Shah, Iran has turned so anti-American that
just about any Washington attempt to influence events there is
likely to backfire; certainly none of Iran's contending factions
can afford to be thought of as pro-U.S. Iran needs a
demonstration that the U.S. has not the slightest wish to
dominate the country.

   The U.S. must try to contain the spread of Khomeini-inspired
anti-Americanism in the Middle East. The best way to do that
would be to mediate successfully the Egyptian-Israeli peace
negotiations, to ensure that they will lead to genuine
autonomy for the Palestinians of the West Bank and Gaza. The
degree to which the Palestinians problem has inflamed passions
even among Arabs who consider themselves pro-U.S. is not at all
understood by Americans. Says Faisal Alhegelan, Saudi Ambassador
to the U.S.: "All you have to do is grant the right of
Palestinian self-determination, and you will find how quickly
the entire Arab world will stack up behind Washington."

   There are also some lessons the U.S. can learn that might
help keep future Third World revolutions from taking an anti-
American turn. First, suggests Stanley Hoffmann, Harvard
professor of government, the U.S. should stop focusing
exclusively on the struggle between the U.S. and Communism and
pay more attention to the aspiration of nations that have no
desire for alliance with either side. Says Hoffmann: "To me, the
biggest meaning of Iran is that it is the first major
international crisis that is not an East-West crisis, and for
that very reason we find ourselves much less able to react.
There is very little attention given to the problems of
revolutionary instability and internal discontent. Americans
don't study any of this, and when such events happen, we are
caught by surprise."

   A corollary thought is that the U.S. must avoid getting
tied too closely to anti-Communist "strongmen" who are detested
by their own people. Says Selig Harrison: "We should not be so
committed that we become hostage to political fortune.  We
should have contact will all the forces in these countries, and
we should not regard any of them as beyond the pale, even many
Communist movements that would like to offset their dependence
on Moscow and Peking." Such a policy, of course, is easier
proclaimed than executed. In some volatile Third World
countries, the only choice may be between a tyrant in power and
several would-be tyrants in opposition. But when the U.S. does
find itself allied with a dictator, it can at least press him
to liberalize his regime and at the same time stay in touch with
other elements in the society.

   Finally, Khomeini has blown apart the comfortable myth that
as the Third World industrializes, it will adopt Western values,
and the success of his revolution ought to force the U.S. to
look for ways to foster material prosperity in Third World
countries without alienating their cultures. Says Richard
Bulliet, a Columbia University historian who specializes in the
Middle East: "We have to realize that there are other ways of
looking at the future than regarding us as being the future. It
is possible that the world is not going to be homogenized along
American-European lines."

   It is, unfortunately, almost surely too late for any such
U.S. strategies to influence Ayatullah Khomeini, whose hostility
to anything American is bitter, stubborn, zealous -- and total.
But he may have taught the U.S. a useful -- even vital -- lesson
for the 1980s. He has shown that the challenges to the West are
certain to get more and more complex, and that the U.S. will
ignore this fact at its peril. He has made it plain that every
effort must be made to avoid the rise of other Khomeinis. Even
if he should hold power only briefly, the Ayatullah is a figure
of historic importance. Not only was 1979 his year; the forces
of disintegration that he let loose in one country could
threaten many others in the years ahead.