IRAN'S BIG SHIFT

By Scott Macleod/Tehran

Many believed the election results were preordained, if not precooked. For months it had been a foregone conclusion that the next President of Iran would be Ali Akbar Nateq-Noori, the Speaker of the Iranian parliament, a staunch conservative backed by the country's most powerful political machine. He even had the implicit support of Iran's Supreme Leader, the Ayatullah Ali Khamenei, successor of the Ayatullah Khomeini.

But something was happening that Iran had never seen before. It was exemplified last week in Fadiyian Islam, one of south Tehran's poorest neighborhoods and a former bedrock of support for Khomeini. Thousands of ecstatic Iranians overflowed into the dusty streets shouting, "Khatami! Khatami! You're the hope!" as they rushed toward a 54-year-old black-turbaned cleric, nearly crushing him as he mounted a podium inside a mosque. In the election campaign that began four weeks ago, Mohammed Khatami was a sensation. Surveys showed his support climbing from 13.9% to 20.2% to 52% on election eve. On Saturday, the reluctant candidate, who was once hounded out of the Iranian Cabinet by fellow clerics, handed the conservative theocracy a stunning upset. The moderate won 69.7% of the 29.7 million votes cast.

Who voted for Khatami? Iranians fed up with political and social restrictions, women chafing at dress codes, twentysomethings denied satellite dishes and dispirited citizens who never saw a reason to vote--until Khatami came along. Few misunderstood the protest message of his triumph. Says Hassan, 18, a member of the generation born after Khomeini's 1979 revolution: "We want to have more freedom here in this country." Says Abdelkarim Soroush, perhaps the regime's most prominent internal critic: "The election was a referendum on liberty, justice, everything." One supporter simply gushed, "Khatami is Ayatullah Gorbachev."

A moderate? A moderate President, no less? In Iran? Western officials, trying to cope with Iran's sponsorship of terrorism, opposition to the Middle East peace process and development of nuclear weapons, are understandably wary of the thought. Yet, for once, Iranians had been offered a real choice, not a stage-managed election rigged for a handpicked President. No politician symbolized the hold of the incumbent clerics more than Nateq-Noori. His supporters provoked widespread anger by physically breaking up a Khatami speech, getting police to cancel a major rally and using a technicality to close down Khatami's election headquarters in the last week of campaigning. Nateq-Noori was the candidate of a militant Islamic front combining the conservative mullahs of the holy city of Qum and the middle-class traders of the Tehran bazaar. A former Khomeini bodyguard, he had become a top police official, then head of the conservative-controlled National Assembly. His campaign slogan was an oath of absolute loyalty to the mullahs' supreme rule.

Khatami, on the other hand, is a liberal theologian, a politician who speaks of freedom, a family man with an avuncular grin and a scholar who has worked in the West and is said to be at home in English, German and Arabic. That's quite a contrast to the severe and sober ayatullahs who have governed since the 1979 Islamic revolution. Five years ago, they drove Khatami from his Cabinet post as Minister of Culture, accusing him of allowing an "invasion" of decadent ideas from the U.S. and Europe. When the elections came due, the ruling mullahs thought so little of Khatami's popular appeal that they allowed him and two others to run as officially sanctioned candidates against Nateq-Noori.

Like his opponent, Khatami attended the seminary in Qum. Yet he also studied Western philosophy. He wrote some speeches for Khomeini but is otherwise the first President who lacks revolutionary credentials. His own campaign speeches promised more freedom and tolerance. "Our country has a long way to go," he said in his last speech. "The government doesn't give people the opportunity to grow."

If his victory turned on a single issue, it was the principled stand Khatami took in his confrontation with the hard-liners five years ago. As Culture Minister, he was widely appreciated for permitting relatively free circulation of books and films. But he was undone by his support for director Mohsen Makhmalbaf, whose films Nights of Zayandehrood and Time of Love dealt with taboo subjects like adultery and suicide--and hinted that tyranny did not end with the Shah's departure. Outraged conservative mullahs forced Khatami out and imposed a cultural crackdown that still continues.

Even his closest advisers acknowledge that Khatami has a tough job ahead in running a country of 70 million people. Iran's problems are immense, despite oil exports of $19 billion last year. Unemployment stands at perhaps 20%. Riots have flared as authorities have tried to cope with a huge foreign debt and high inflation, now 25%. One of the world's highest birthrates means two-thirds of Iranians are under 25. Since the revolution, per capita annual income has fallen from $1,200 to $800.

Khatami's biggest challenge, however, will be managing the regime. The President's powers are subject to limits. Reflecting the political chaos of revolutionary days, Iran's system is a jumble of conflicting and confusing centers of power. This looseness is what enables Iranians to have semifree elections, but it also gives cover to the regime's extremist elements. Many Iranians fear that the system may ultimately paralyze Khatami. He calls himself an independent, although he is a member of a clerical group aligned with leftists, including those who held American diplomats hostage for 444 days in 1979-81. Khatami's advisers say he hopes to benefit from a partnership with outgoing President Ali Akbar Hashemi Rafsanjani, who will remain a major influence as head of the Expediency Council, which advises the Supreme Leader.

Khatami, his aides say, is determined to rein in the regime's extremist factions, centered in the Revolutionary Guards and intelligence services. The pragmatic Rafsanjani was hesitant about facing down the radicals, but aides say Khatami may be bolder, given his overwhelming popular victory. He will have the backing at least of Rafsanjani's daughter Faezeh Hashemi, one of Iran's most popular politicians, who is under attack from radicals. "Khatami believes in freedom," she told TIME last week.

Washington and other Western capitals will be watching Khatami closely. Some warn against making too much of his moderation. "Let's face it. It wasn't a paradise during his tenure as Culture Minister," says a Western diplomat in Tehran. But Khatami knows he will be in deep trouble if he fails to deliver, since hopes are so high. Says Tehran psychologist Shahriar Rouhani: "Young people in Iran are ready to burst. The President must lead them in a new direction." No leader since Khomeini has won such a mandate. "I love him with all my heart," says Hussein Hashemi, 22, a computer technician who voted in the north Tehran neighborhood where Khomeini lived and preached. "In the beginning, we needed militants. Now we need people who can build the country. We need a man like Khatami."