Three sets of problems preoccupied the Iranians in 1986: the war with Iraq; the continued economic downturn, and the fierce power struggle within the revolutionary Establishment. The problems were clearly interrelated and inseparable: the war added to the economic burden and gradually turned into an issue of controversy; the economic difficulties influenced the war strategy and were at the center of the internal rifts; the struggle for power evolved around the economy and the war as well as the most crucial question of the policy and — no less important — the leadership of Iran after the death of Ayatollah Ruhollah Khomeyni.