Iran Among these countries, Iran in many respects represents the greatest challenge we will face over the next year. It appears to us that a genuine struggle is now underway between hardline conservatives and more moderate elements represented by Iran's new President Khatami. Since assuming office in August, he has made limited but real progress toward fulfilling his campaign pledges for political and social reforms. He gained approval for a new cabinet that puts his people in key posts such as the ministries of Foreign Affairs, Interior, and Islamic Culture. Censorship is now less oppressive, with previously banned periodicals reappearing and socially controversial films being shown.
Progress is likely to be fitful, however, and hard-line elements remain formidable obstacles.
They still control the country's defense and security organizations, for example, and therefore exert heavy influence on issues most vital to the United States. Statements by Khatami and his foreign ministry suggest he is trying to play a more constructive role in the international community. It is simply too early to tell , however, whether this will lead to demonstrable changes in Iranian policies that matter most to the United States. We have seen no reduction in Iran's efforts to support Hizballah, radical Palestinians, and militant Islamic groups that engage in terrorism. Moreover, even as it attempts to improve its international image, Tehran is continuing to bolster its military capabilities.