The humiliating defeat of Mahmoud Ahmadinejad's allies at the hands of moderate conservatives in Iran's municipal and Assembly of Experts elections on 15 December 2006 might in principle have been expected to constrain the rhetoric and behaviour of the hardline president. Instead, it seems to have had the opposite effect. Ahmadinejad's current visits to putative allies in Venezuela, Nicaragua and Ecuador indicate that his strategy is to turn the temperature of confrontation with the United States up rather than down. But is this a sign of his strength or his weakness?

The president's belligerent political reaction is a sign of how far domestic and foreign-policy concerns are now intertwined in Iran. On the one hand, Ahmadinejad and his militant faction of allies (which received an embarrassingly small share of the popular vote in the elections) is attempting to gain an advantage in the intense power struggles that characterise the regime. On the other hand, the decision by Iran to ignore the demand of the United Nations Security Council - in its Resolution 1737 of 23 December - that it halt its nuclear enrichment programme risks prompting the United States president and administration, congress, and public opinion to coalesce around the idea of pursuing a military solution to Iran's quest for nuclear-weapons capability.

Indeed, the signals from Washington about the need to curb Iranian influence in Iraq and the wider region suggest that the US is responding to Ahmadinejad's domestic predicament and Iran's perceived rising influence with a combative strategy of its own. The ingredients of a potentially dangerous confrontation are being put in place on both sides.

Dariush Zahedi teaches at the departments of political economy and peace and conflict studies at the University of California at Berkeley. He also teaches at UC Berkeley's Boalt Hall School of Law

Omid Memarian is an Iranian journalist and civil-society activist. He was awarded Human Rights Watch 's highest honour, the Human Rights Defender award, in 2005. In that year, he was a visiting scholar at the Graduate School of Journalism at the University of California, Berkeley. Omid Memarian's blog is here

Also by Omid Memarian in openDemocracy:

"Under the radar: an Iranian and America" (17 August 2006)

Populism gone sour

Mahmoud Ahmadinejad was elected in June 2005 by tapping into the frustrations of Iran's large underclass. A populist campaign platform of redistributing oil wealth, fighting corruption, and creating jobs allowed him to outflank rivals such as former president Hashemi Rafsanjani and secure victory. Eighteen months on, it has long become clear that the former Tehran mayor has shattered the raised expectation of the (mainly) poor Iranians who voted for him.

Ahmadinejad's ill-advised economic policy - injecting large amounts of petrodollars into the economy, deficit spending, and raising liquidity to unstable levels - has backfired. Official Iranian statistics reveal the rate of inflation on basic items to have risen to 20%, while rents have increased by 30%. The Iranian economy is reeling from endemic capital flight, inability to attract much-needed investment, and declining real-estate and capital markets. The deteriorating climate of uncertainty has taken its toll on Iranians' living standards.

At least as significant is that conservatives (both old and new generations) - who along with their relations control much of the economy - are increasingly weary of the president's rule and policies. A younger generation of pragmatic neo-conservatives forms a significant proportion of the ruling elite. Many of them, like Ahmadinejad himself, have a background in the security agencies, and together they control most seats in the majlis (Iran's parliament). But they are deeply disaffected with their president, and especially repulsed by his monopolistic and go-it-alone impulses. The rigid president refuses to consult, and has replaced virtually all of Iran's bureaucratic, diplomatic, governmental, university, and banking officials by ideological purists who share his outlook and are personally beholden to him.

Along with the older generation of more traditional conservatives, these neo-conservatives are increasingly alarmed too by the foreign-policy consequences of the president's rambunctious rhetorical utterances and demeanour. The "review of the holocaust: global vision" conference in Tehran on 11-12 December - hosted at Tehran 's Institute for Political and International Studies, but championed particularly by Ahmadinejad himself - reinforced the image the president had already created with his notorious comments of October 2005 and later; this ideological zealotry may have helped convince Russia and China finally to vote for the imposition of Security Council sanctions against Iran.

A time to think

The absence of valid and reliable polls on the popularity of the president meant that many among the Iranian elite - though becoming more lukewarm towards Ahmadinejad even before the December elections - were ready to give him the benefit of the doubt. Now, with his image deeply frayed, criticism of his policies in the parliament will become louder, and he will find it more difficult to enact his legislative agenda.

Moreover, as in the United States, various committees in the majlis will begin to delve into misdeeds that have occurred under his watch - including the misappropriation of $300 million during Ahmadinejad 's period of service as Tehran's mayor (2002-05). In short, Ahmadinejad will find it increasingly difficult to govern.

It is likely too that the voices of Ahmadinejad and his allies will become muffled in Iran's collective decision-making institutions such as the supreme council for national security that governs the settlement of disputes regarding the nation's foreign and domestic policies.

But Ahmadinejad's temperament and political character mean that he is most unlikely to go gently into the night. In this light, his ratcheting-up of international tensions by intensifying anti-Israel and anti-American rhetoric is an attempt to regain the political initiative and deflect attention from his inability to deliver on his promises to the electorate.

Among openDemocracy 's recent articles on Iranian politics in a period of crisis:

Nazenin Ansari, "An ayatollah under siege…in Tehran" (4 October 2006)

Hooshang Amirahmadi, "Iran and the international community: roots of perpetual crisis" (24 November 2006)

Nasrin Alavi, "Iran: cracks in the façade" (11 December 2006)

Nasrin Alavi, "Iran 's election backlash" (19 December 2006)

In one sense, his timing could not be "better". Although UN sanctions will undoubtedly hurt Iran, they will not bring the regime to its knees. Moreover, and as in the case of North Korea, the Security Council is likely eventually to reach a diplomatic impasse, whereby China and Russia will refuse to countenance the imposition of the type of biting sanctions favoured by the US and the European Union. This will give Iran even more time to pursue its strategic objectives.

This, then, appears to be Ahmadinejad's calculation: that an exacerbation of tension in the security environment surrounding Iran will play into the hands of his clique by galvanising the Iranian public and compelling the country's fractious ruling elite to close ranks behind the most militant and radical elements in the Tehran regime.

The terrible danger of this approach is that, combined with the interests and objectives of its strategic rivals the United States and Israel, it will bring closer the prospect of pre-emptive assaults on Iran's nuclear installations. Iran's decisions to accelerate its nuclear programme in defiance of the International Atomic Energy Agency (IAEA), and the unfolding US predicament in Iraq as the presidential election of 2008 approaches, are crucial factors in this perilous mix.

Indeed, the next American president, unencumbered by the current administration's false utterances about Saddam Hussein's weapons of mass destruction, may find it easier to attack Iran. Both John McCain and Hillary Clinton, the presumptive Republican and Democratic frontrunners, seem to agree that the only thing worse than launching strategic attacks against Iran is an Iran armed with nuclear weapons.

Mahmoud Ahmadinejad may be smiling all the way to paradise. But the interests of stability and security in the middle east and beyond, the democratic movement in Iran, and America's image in the Muslim world, all require a change of course on both sides before disaster strikes.