'For example, there is an honourable butcher in our neighbourhood who is aware of all the problems of the people and I also get important economic information from him,” President of Iran Adam Smith is quoted to have said that 'Civil government is in reality instituted for the defence of the rich against the poor.' This maxim is particularly apt when the President of an oil rich $600 billion economy talks shop with his neighbourhood butcher. 'We have hardworking shopkeepers in our neighbourhood from whom I get important economic information because they are living among the people.' Mahmoud Ahmadinejad has said he keeps his finger on Iran's economic pulse by talking to his butcher. Ahmadinejad, the son of a conscientious blacksmith, has also referred to his local shopkeepers when addressing Iranian economic issues. Facing complaints about inflation, he told parliament in a budget speech in January that Iranians should pop around to his neighbourhood grocer to buy tomatoes where he said they were much cheaper than the soaring prices he said others were citing. It defies all logic as to why the President depends on the shopkeepers to devise his economic policies. Ideally, Iranian economy has to be run by a coterie of leading economists. At present, from his last few years of economic speeches, not much can be gleaned as to where he reverts for his economic policies other than his butcher and tomato seller who take leading roles on his board of economic governance.

The President’s Iran under the Ayatollahs is a country which they believe is described adequately by B. Mandeville: 'Thus every part was full of vice, yet the whole Mass was Paradise.' This philosophy is the cornerstone of state policies based on which the Mullahs’ President lays down the blueprint of future Iran. His emphasis on economic policy is based on charity, giving away such as distributing free soup to the poor. His presidential campaign motto was, 'It's possible and we can do it.'

One of his goals is 'putting the petroleum income on people's tables', referring to Iran's oil profits being distributed among the poor. The schism within the spiritual politburo capitalist roaders' pistachio-trading Mullahs and capitalist free marketers’ Ayatollahs is wide open. Akbar Hashemi Rafsanjani, who is a capitalist, has invoked the supreme leader, suggesting the leader was pained by the very slow pace of privatisation under Mr Ahmadinejad's government and in January 2007, Hossein Ali Montazeri harshly criticized Ahmadinejad and accused him of harming the country. Iran last week postponed for a month the introduction of petrol rationing, intended to cut the cost of providing hugely subsidised fuel to motorists. The president called high petrol consumption as the main problem facing national economy.

I was thinking that with all his common touch and triviality, he must have some knowledge of Economics. The reference to tomato prices is so authentic. The President is not alone when he tries to gauge Iranian economy inflation numbers through tomato vendors; even Prof Dave Wharton of Cornell University has an assignment for 101 courses where he uses tomatoes to make a freshman understand economy. This is one of the questions in his class: Consider a constant-slope production possibilities’ frontier with a vertical intercept of 40 potatoes and a horizontal intercept of 20 tomatoes. The opportunity cost of increasing tomato output from 10 to 11 is... a. ½ potato b. 2 potatoes c. 1 potato d. 4 potatoes e. cannot be determined from the information given. What if the President does not listen to the experts? It appears Iran should rejoice that the President and tomato vendors are inadvertently gauging inflation and production bottlenecks to come up with the answer to the above question that the opportunity cost of increasing tomato output from 10 to 11 is just the slope of PPF, which tells how many units of potatoes they need to give to increase their tomato production by 1 unit. I doubt that any other President would have come up with a more essential approach than listening to the shopkeepers. His understanding of street convenient economy has led to 30 billion $ worth of subsidies in this annual budget to cover shortages and measures of rationing and price controls.

Street economy always leads to easy solutions not the difficult ones. Iran, a huge oil producer, imports petroleum and subsidises it for its own populace. The street tomato vendors and butchers will naturally not tell him that planning of new refineries might solve the problem in the long run. Perhaps subsidies and handouts are easy solutions and help him run his tenure bet