Adrian Hamilton: How can Iranians mend their broken Islamic Republic?

Ahmadinejad may have been declared the victor, but he lacks legitimacy

David Miliband, the Foreign Secretary, ought to be pleased with Iran. There is no one else left in the world who would categorise Britain as uniquely evil or threatening, let alone important enough to go for full-scale diplomatic confrontation. If only we did have the power or means to destabilise other countries, as we have been accused of. But, on the whole, we huff and we puff, as we have over Georgia, Zimbabwe and Burma, and no one takes a blind bit of notice, regarding us as a power from the past whose only role has been as a "loyal ally" of the US.

Indeed, you could put the same interpretation on the current spat with Tehran. Very few people, even in the remoter parts of Iran, still believe in Britain as an imperial manipulator behind every plot. The Foreign Office gave up its expertise on Iran (and it had considerable knowledge) when it wilfully marginalised nation expertise in favour of concentration on "issues" such as climate change and nuclear proliferation. If anyone poses a threat from here, it is not the Government but the BBC and its Persian language service, the part of the organisation which is always cut.

No, Preisdent Mahmoud Ahmadinejad has struck out against London not because he fears it but because he wants the cover of outside interference to explain away an essentially home-grown revolt and justify its suppression. Britain is a useful bogey to conjure up because it is a way of attacking the Americans without naming them.

It is a sad reflection of our fading authority that the only response that seems to be causing any nervousness in Iran is the threat of combined action by the whole of the European Union over the seizure of British embassy staff. The Americans have chosen to keep well out of this quarrel, and who can blame them? There is nothing in it for a new administration that wants to open up a dialogue with Iran, however put-upon its "loyal ally" might be. Their support would only make matters worse.

Which remains the dilemma for the outside world in reacting to events within Iran. We may have dearly wished that this election would succeed in changing the face of Iran. But our wish became father to the belief that the demonstrations against the disputed result would succeed in doing precisely that. They haven't. The reality for the moment is that the reformist cause has gone into retreat. Lacking effective leadership and a cohesive plan, failing to gather through the provincial cities outside, many of its leaders arrested and crowds violently suppressed, it has pulled back.

The pronouncement by Iran's Guardian Council this week that the vote was fair and Ahmadinejad has been duly re-elected has been the signal for a gathering of clerical ranks behind the decision. And yet the waters are clearly not going to close over this event. Forget all the western commentary talking about the irreconcilable splits in the establishment and genies let out of the bottle. Iran has always had splits and occasional revolts and returned to a period of uneasy, conservative suppression. It may well do so again now.

What is different on this occasion is that there is now an open stand-off between two opposing dynamics. On the one side has been the radical technocrat and militia forces led by Ahmadinejad, formed by the Iran-Iraq war and hostile to the old clerical establishment. On the other side is the new, educated generation with no recollection of that war, who seek a more open society, especially the women who make up 60 per cent of those in higher education.

Formally, the Supreme Ruler is supposed to act as the neutral umpire on internal division. In this case he didn't, coming out publicly and early in favour of Ahmadinejad, but that has only made the stand-off more difficult to solve. Because the demonstrations never made it to full revolt, they remain unresolved. Ahmadinejad may have been declared victor on a partial recount, but he lacks legitimacy because he lacks the assent that should have come from a democratic election.

That matters in Iran's dealings abroad, not just with the West but in the region, but it also matters internally. The Islamic Republic was set up to ensure clerical rule with popular backing. That system has broken down, at least for the time being. With two different forces pulling in opposite directions, it is difficult to see how it can be put back together.

a.hamilton@independent.co.uk