More than two years ago, Seymour Hersh disclosed in the New Yorker how President George W Bush was considering strategic nuclear strikes against Iran. Ever since, a campaign to demonize that country has proceeded in a relentless, Terminator-like way, applying the same techniques and semantic contortions that were so familiar in the period before the Bush administration launched its invasion of Iraq.

The campaign's greatest hits are widely known: "The ayatollahs" are building a Shi'ite nuclear bomb; Iranian weapons are killing American soldiers in Iraq; Iranian gunboats are provoking US warships in the Persian Gulf. Iran, in short, is the new al-Qaeda, a terror state aimed at the heart of the United States. It's idle to expect the American mainstream media to offer any tools that might put this orchestrated blitzkrieg in context.

Here are just a few recent instances of the ongoing campaign: Secretary of Defense Robert Gates insists that Iran "is hell-bent on acquiring nuclear weapons". Admiral Michael Mullen, chairman of the Joint Chiefs of Staff, admits that the Pentagon is planning for "potential military courses of action" when it comes to Iran. In tandem with US commander in Iraq General David Petraeus, Mullen denounces Iran's "increasingly lethal and malign influence" in Iraq, although he claims to harbor "no expectations" of an attack on Iran "in the immediate future" and even admits he has "no smoking gun which could prove that the highest leadership [of Iran] is involved".

But keep in mind one thing the Great Saddam take-out of 2003 proved: that a "smoking gun" is, in the end, irrelevant. And this week, the US is ominously floating a second aircraft carrier battle group into the Persian Gulf.

But what of Iran itself under the blizzard of charges and threats? What to make of it? What does the world look like from Tehran? Here are five ways to think about Iran under the gun and to better decode the Iranian chessboard.

1. Don't underestimate the power of Shi'ite Islam: Seventy-five percent of the world's oil reserves are in the Persian Gulf. Seventy percent of the Gulf's population is Shi'ite. Shi'ism is an eschatological - and revolutionary - religion, fueled by a passionate mixture of romanticism and cosmic despair. As much as it may instill fear in hegemonic Sunni Islam, some Westerners should feel a certain empathy for intellectual Shi'ism's almost Sartrean nausea towards the vacuous material world.

For more than 1,000 years, Shi'ite Islam has, in fact, been a galaxy of Shi'isms - a kind of Fourth World of its own, always cursed by political exclusion and implacable economic marginalization, always carrying an immensely dramatic view of history with it.

It's impossible to understand Iran without grasping the contradiction that the Iranian religious leadership faces in ruling, however fractiously, a nation state. In the minds of Iran's religious leaders, the very concept of the nation-state is regarded with deep suspicion, because it detracts from the umma, the global Muslim community. The nation-state, as they see it, is but a way-station on the road to the final triumph of Shi'ism and pure Islam.

To venture beyond the present stage of history, however, they also recognize the necessity of reinforcing the nation-state that offers Shi'ism a sanctuary - and that, of course, happens to be Iran. When Shi'ism finally triumphs, the concept of nation-state - a heritage, in any case, of the West - will disappear, replaced by a community organized according to the will of Prophet Mohammad.

In the right context, this is, believe me, a powerful message. I briefly became a mashti - a pilgrim visiting a privileged Shi'ite gateway to Paradise, the holy shrine of Imam Reza in Mashhad, four hours west of the Iran-Afghan border. At sunset, the only foreigner lost in a pious multitude of black chadors and white turbans occupying every square inch of the huge walled shrine, I felt a tremendous emotional jolt. And I wasn't even a believer, just a simple infidel.

2. Geography is destiny: Whenever I go to the holy city of Qom, bordering the central deserts in Iran, I am always reminded, in no uncertain terms, that, as far as the major ayatollahs are concerned, their supreme mission is to convert the rest of Islam to the original purity and revolutionary power of Shi'ism - a religion invariably critical of the established social and political order.

Even a Shi'ite leader in Tehran, however, can't simply live by preaching and conversion alone. Iran, after all, happens to be a nation-state at the crucial intersection of the Arabic, Turkish, Russian and Indian worlds. It is the key transit point of the Middle East, the Persian Gulf, Central Asia, the Caucasus, and the Indian sub-continent. It lies between three seas (the Caspian, the Persian Gulf and the sea of Oman). Close to Europe and yet at the gates of Asia (in fact part of Southwest Asia), Iran is the ultimate Eurasian crossroads. Isfahan, the country's third-largest city, is roughly equidistant from Paris and Shanghai. No wonder US Vice President Dick Cheney, checking out Iran, "salivates like a Pavlov dog" (to quote those rock 'n roll geopoliticians, the Rolling Stones).

Members of the Iranian upper middle classes in north Tehran might spin dreams of Iran recapturing the expansive range of influence once held by the Persian empire; but the silky, Qom-carpet-like diplomats at the Ministry of Foreign Affairs will assure you that what they really dream of is an Iran respected as a major regional power.

To this end, they have little choice, faced with the enmity of the globe's "sole superpower", but to employ a sophisticated counter-encirclement foreign policy. After all, Iran is now completely surrounded by post-September 11 American military bases in Afghanistan, Central Asia, Iraq and the Gulf states. It faces the US military on its Afghan, Iraqi, Pakistani and Persian Gulf borders, and lives with ever-tightening US economic sanctions, as well as a continuing drumbeat of Bush administration threats involving possible air assaults on Iranian nuclear (and probably other) facilities.

The Iranian counter-response to sanctions and to its demonization as a rogue or pariah state has been to develop a "Look East" foreign policy that is, in itself, a challenge to American energy hegemony in the Gulf. The policy has been conducted with great skill by Foreign Minister Manouchehr Mottaki, who was educated in Bangalore, India. While focused on massive energy deals with China, India and Pakistan, it looks as well to Africa and Latin America. To the horror of American neo-cons, an intercontinental "axis of evil" air link already exists - a weekly commercial Tehran-Caracas flight via Iran Air.

Iran's diplomatic (and energy) reach is now striking. When I was in Bolivia this year, I learned of a tour Iran's ambassador to Venezuela had taken on the jet of Bolivian President Evo Morales. The ambassador reportedly offered Morales "everything he wanted" to offset the influence of "American imperialism".

Meanwhile, a fierce energy competition is developing among the Turks, Iranians, Russians, Chinese and Americans - all placing their bets on which future trade routes will be the crucial ones as oil and natural gas flow out of Central Asia.

As a player, Iran is trying to position itself as the unavoidable bazaar-state in an oil-and-gas-fueled new Silk Road - the backbone of a new Asian energy security grid. That's how it could recover some of the preeminence it enjoyed in the distant era of Darius, the King of Kings. And that's the main reason why US neo-Cold Warriors, Zio-cons, armchair imperialists, or all of the above, are throwing such a collective - and threatening - fit.

3. What is Ahmadinejad up to?: Ever since the days when former Iranian president Mohammed Khatami suggested a "dialogue of civilizations", Iranian diplomats have endlessly repeated the official position on Iran's nuclear program: it's peaceful; the International Atomic Energy Agency (IAEA) has found no proof of the military development of nuclear power; the religious leadership opposes atomic weapons; and Iran - unlike the US - has not invaded or attacked any nation for the past quarter millennium.

Think of George W Bush and Iranian President Mahmud Ahmadinejad as the new Blues Brothers: both believe they are on a mission from God. Both are religious fundamentalists. Ahmadinejad believes fervently in the imminent return of the Mahdi, the Shi'ite messiah, who "disappeared" and has remained hidden since the ninth century. Bush believes fervently in a coming end and the return of Jesus Christ. But only Bush, despite his actual invasions and constant threats, gets a (sort of) free pass from the Western ideological machine, while Ahmadinejad is portrayed as a Hitlerian believer in a new Holocaust.

Ahmadinejad is relentlessly depicted as an angry, totally irrational, Jew-hating, Holocaust-denying Islamo-fascist who wants to "wipe Israel off the map". That infamous quote, repeated ad nauseam but out of context, comes from an October 2005 speech at an obscure anti-Zionist student conference. What Ahmadinejad really said, in a literal translation from Farsi, was that "the regime occupying Jerusalem must vanish from the pages of time". He was actually quoting the leader of the 1979 Islamic Revolution, Ayatollah Ruhollah Khomeini, who said it first in the early 1980s. Khomeini hoped that a regime so unjust toward the Palestinians would be replaced by another more equitable one. He was not, however, threatening to nuke Israel.

In the 1980s, in the bitterest years of the Iran-Iraq war, Khomeini also made it very clear that the production, possession or use of nuclear weapons is against Islam. Iran's Supreme Leader Ayatollah Ali Khamenei later issued a fatwa - a religious injunction - under the same terms. For the theocratic regime, however, the Iranian nuclear program is a powerful symbol of independence vis-a-vis what is still widely considered by Iranians of all social classes and educational backgrounds as Anglo-Saxon colonialism.

Ahmadinejad is mad for the Iranian nuclear program. It's his bread and butter in terms of domestic popularity. During the Iran-Iraq war, he was a member of a support team aiding anti-Saddam Hussein Kurdish forces. (That's when he became friends with "Uncle" Jalal Talabani, now the Kurdish president of Iraq.) Not many presidents have been trained in guerrilla warfare. Speculation is rampant in Tehran that Ahmadinejad, the leadership of the Quds Force, an elite division of the Iranian Revolutionary Guard Corps (IRGC), plus the hardcore volunteer militia, the Basij (informally known in Iran as "the army of 20 million"), are betting on a US attack on Iran's nuclear facilities to strengthen the country's theocratic regime and their faction of it.

Reformists refer to Russian President Vladimir Putin's visit to Tehran last October, when he was received by the Supreme Leader (a very rare honor). Putin offered a new plan to resolve the explosive Iranian nuclear dossier: Iran would halt nuclear enrichment on Iranian soil in return for peaceful nuclear cooperation and development in league with Russia, the Europeans, and the IAEA.

Iran's top nuclear negotiator of that moment, Ali Larijani, a confidant of Supreme Leader Khamenei, as well as the leader himself let it be known that the idea would be seriously considered. But Ahmadinejad immediately contradicted the Supreme Leader in public. Even more startling, yet evidently with the leader's acquiescence, he then sacked Larijani and replaced him with a longtime friend, Saeed Jalili, an ideological hardliner.

4. A velvet revolution is not around the corner: Before the 2005 Iranian elections, at a secret, high-level meeting of the ruling ayatollahs in his house, the Supreme Leader concluded that Ahmadinejad would be able to revive the regime with his populist rhetoric and pious conservatism, which then seemed very appealing to the downtrodden masses. (Curiously enough, Ahmadinejad's campaign motto was: "We can.")

But the ruling ayatollahs miscalculated. Since they controlled all key levers of power - the Supreme National Security Council, the Council of Guardians, the Judiciary, the bonyads (Islamic foundations that control vast sections of the economy), the army, the IRGC (the parallel army created by Khomeini in 1979 and recently branded a terrorist organization by the Bush administration), the media - they assumed they would also control the self-described "street cleaner of the people". How wrong they have been.

For Khamenei himself, this was big business. After 18 years of non-stop internal struggle, he was finally in full control of executive power, as well as of the legislature, the judiciary, the IRGC, the Basij, and the key ayatollahs in Qom.

Ahmadinejad, for his part, unleashed his own agenda. He purged the Ministry of Foreign Affairs of many reformist-minded diplomats; encouraged the Interior Ministry and the Ministry of Culture and Islamic Guidance to crackdown on all forms of "nefarious" Western influences, from entertainment industry products to colorful made-in-India scarves for women; and filled his cabinet with revolutionary friends from the Iran-Iraq war days. These friends proved to be as faithful as administratively incompetent - especially in terms of economic policy. Instead of solidifying the theocratic leadership under Supreme Leader Khamenei, Ahmadinejad increasingly fractured an increasingly unpopular ruling elite.

Nonetheless, discontent with Ahmadinejad's economic incompetence has not translated into street barricades and it probably will not; nor, contrary to neo-con fantasy land scenarios, would an attack on Iran's nuclear facilities provoke a popular uprising. Every single political faction supports the nuclear program out of patriotic pride.

There is surely a glaring paradox here. The regime may be wildly unpopular - because of so much enforced austerity in an energy-rich land and the virtual absence of social mobility - but for millions, especially in the countryside and the remote provinces, life is still bearable. In the large urban centers - Tehran, Isfahan, Shiraz and Tabriz - most would be in favor of a move toward a more market-oriented economy combined with a progressive liberalization of mores (even as the regime insists on going the other way). No velvet revolution, however, seems to be on the horizon.

At least four main factions are at play in the intricate Persian-miniature-like game of today's Iranian power politics - and two others, the revolutionary left and the secular right, even though thoroughly marginalized, shouldn't be forgotten either.

The extreme right, very religiously conservative but economically socialist, has, from the beginning, been closely aligned with the Egyptian Muslim Brotherhood. Ahmadinejad is the star of this faction.

The clerics, from the Supreme Leader to thousands of provincial religious figures, are pure conservatives, even more patriotic than the extreme right, yet generally no lovers of Ahmadinejad. But there is a crucial internal split. The substantially wealthy bonyads - the Islamic foundations, active in all economic sectors - badly want a reconciliation with the West. They know that, under the pressure of Western sanctions, the relentless flight of both capital and brains is working against the national interest.

Economists in Tehran project there may be as much as US$600 billion in Iranian funds invested in the economies of Persian Gulf petro-monarchies. The best and the brightest continue to flee the country. But the Islamic foundations also know that this state of affairs slowly undermines Ahmadinejad's power.

The extremely influential IRGC, a key component of government with vast economic interests, transits between these two factions. They privilege the fight against what they define as Zionism, are in favor of close relations with Sunni Arab states, and want to go all the way with the nuclear program. In fact, substantial sections of the IRGC and the Basij believe Iran must enter the nuclear club not only to prevent an attack by the "American Satan" but to irreversibly change the balance of power in the Middle East and Southwest Asia.

The current reformists/progressives of the left were originally former partisans of Khomeini's son, Ahmad Khomeini. Later, after a spectacular mutation from Soviet-style socialism to some sort of religious democracy, their new icon became former president Mohammad Khatami (of "dialogue of civilizations" fame). Here, after all, was an Islamic president who had captured the youth vote and the women's vote and had written about the ideas of German philosopher Jurgen Habermas as applied to civil society as well as the possibility of democratization in Iran. Unfortunately, his "Tehran Spring" didn't last long - and is now long gone.

The key establishment faction is undoubtedly that of moderate Hashemi Rafsanjani, a former two-term president, current chairman of the Expediency Council and a key member of the Council of Experts - 86 clerics, no women, the Holy Grail of the system, and the only institution in the Islamic Republic capable of removing the Supreme Leader from office. He is now supported by the intelligentsia and urban youth. Colloquially known as "The Shark", Rafsanjani is the consummate Machiavellian. He retains privileged ties to key Washington players and has proven to be the ultimate survivor - moving like a skilled juggler between Khatami and Khamenei as power in the country shifted.

Rafsanjani is, and will always remain, a supporter of the Supreme Leader. As the regime's de facto number two, his quest is not only to "save" the Islamic Revolution of 1979 but also to consolidate Iran's regional power and reconcile the country with the West. His reasoning is clear: he knows that an anti-Islamic tempest is already brewing among the young in Iran's major cities, who dream of integrating with the nomad elites of liquid global modernity.

If the Bush administration had any real desire to let its aircraft carriers float out of the Gulf and establish an entente cordiale with Tehran, Rafsanjani would be the man to talk to.

5. Heading down the New Silk Road. Reformist friends in Tehran keep telling me the country is now immersed in an atmosphere similar to the Cultural Revolution of the 1960s in China or the 1980s rectification campaign in Cuba - and nothing "velvet" or "orange" or "tulip" or any of the other color-coded Western-style movements that Washington might dream of is, as yet, on the horizon.

Under such conditions, what if there were an American air attack on Iran? The Supreme Leader, on the record, offered his own version of threats in 2006. If Iran were attacked, he said, the retaliation would be doubly powerful against US interests elsewhere in the world.

From American supply lines and bases in southern Iraq to the Strait of Hormuz, the Iranians, though no military powerhouse, do have the ability to cause real damage to American forces and interests - and certainly to drive the price of oil into the stratosphere. Such a "war" would clearly be a disaster for everyone.

The Iranian theocratic leadership, however, seems to doubt that the Bush administration and the US military, exhausted by their wars in Iraq and Afghanistan, will attack. They feel a tide at their backs. Meanwhile the "Look East" strategy, driven by soaring energy prices, is bearing fruit.

Ahmadinejad has just concluded a tour of South Asia and, to the despair of American neo-cons, the Asian energy security grid is quickly becoming a reality. Two years ago, at the Petroleum Ministry in Tehran, I was told Iran is betting on the total "interdependence of Asia and Persian Gulf geo-economic politics".

This year, Iran finally becomes a natural gas-exporting country. The framework for the $7.6 billion Iran-Pakistan-India pipeline, also known as the "peace" pipeline, is a go. Both these key South Asian US allies are ignoring Bush administration desires and rapidly bolstering their economic, political, cultural, and - crucially - geostrategic connections with Iran. An attack on Iran would now inevitably be viewed as an attack against Asia.

What a disaster in the making, and yet, now more than ever, Cheney's faction in Washington (not to mention possible future president John McCain) seems ready to bomb. Perhaps the Mahdi himself - in his occult wisdom - is betting on a US war against Asia to slouch towards Qom to be reborn.

Pepe Escobar is the author of Globalistan: How the Globalized World is Dissolving into Liquid War (Nimble Books, 2007) and Red Zone Blues: a snapshot of Baghdad during the surge. He may be reached at pepeasia@yahoo.com.