“Where do we go from here?” This must be the question that Mir Hossein Mousavi Khameneh, the defeated candidate in Iran’s presidential election, must be asking himself.

Finding an answer will not be easy.

From the start of his candidacy, the former prime minister boxed himself in a minimalist position that leaves little room for manoeuvre. He offered no clear programme beyond casting himself as the anti-Ahmadinejad candidate. Even those of his supporters who gave him the “reformist” label were unable to say exactly what it was that he wanted to reform and how.

With the election over, Mousavi adopted another minimalist position by asking first for a recount of the votes and then for a complete re-run.

He got neither.

All that the government was prepared to offer was a random recount of 10 per cent of the ballot boxes. However, that, too, ended in more humiliation for Mousavi. The recount reduced his share of the votes and increased that of President Mahmoud Ahmadinejad. Mousavi’s strategy is hard to understand.

If he believes that the authorities arranged the election results to ensure Ahmadinejad’s victory, why should he expect that a recount or a re-run by the same authorities would produce a different outcome?

Three options are open to Mousavi.

He could continue contesting the election results and posing as the winner. A generation ago, he would not have been able to assume such a posture. For the Khomeinist establishment would have ordered his physical liquidation. Now, however, it is unlikely that the regime would arrange for him to fall under a bus. His family ties to the “Supreme Guide” Ali Khamenei may also be an added guarantee.

Such a posture would produce no immediate results for Mousavi.

However, it would continue to cast a shadow on Ahmadinejad’s legitimacy.

Thus, Mousavi would become an Iranian version of Aung San Suu Kyi, the Burmese democratic leader who, having had her election victory “stolen” by the military junta in Rangoon has been under house arrest for more than a decade.

Mousavi’s second option is to organize his supporters, or at least some of them, into a political party or group and contest elections for the Islamic Majlis, Iran’s ersatz parliament, in two years’ time.

Fixing the results of the Majlis elections is harder than cheating in a presidential election. Thus, Mousavi’s group might well be able to secure a toehold in the legislature.

However, for that strategy to succeed, Mousavi would need to repair his relations with the “Supreme Guide” while offering a platform for loyal opposition within the regime.

Such a strategy might ensure Mousavi’s physical safety and, in time, even enable him to contest another presidential election.

However, he might wonder about the utility of such a course of action.

As leader of the “loyal opposition” to a totalitarian regime, he would have little chance of altering the fundamentals of the system while running the risk of bestowing legitimacy on it.

Any attempt at marketing “Khomeinism with a human face” would be as doomed as were attempts at conjuring “Communism with a human face” in the last century.

The most that Mousavi might achieve with such a strategy would be to become an Iranian version of such tragic would-be reformers as Edward Ochab, Wladyslaw Gomulka, Imre Nagy, Janos Kadar, and Alexander Dubcek.

Mousavi’s third option is to tell his supporters that the system in place cannot be reformed, and must be replaced with a new one based on the principle of people’s sovereignty.

Thanks to Mousavi’s decision to fight back, the current crisis has already produced at least one positive result. It has clarified the situation by exposing the composite noun Islamic Republic as an oxymoron. The space allocated to the “republic” has shrunk to its smallest since the start of the Khomeinist regime.

On Tuesday, the official Islamic News Agency (IRNA) published the text of a long sermon by the “Supreme Guide” in the province of Kurdistan and for the staff of the elite 27th Division, spelling out the nature of the regime.

This is what Khamenei says: “Islamic society is the society of the imamate. This means that the imam is at the head of the system. {The Imam is} a man who exercises power because the people follow him as their leader from their heart and because they have full faith in him.”

Khamenei makes no mention of the presidency or any other organ of state because the system he is defending has a single, all-embracing institution: the imamate.

With pretensions about democracy and popular will gone, the current system in Iran is closer to models such as the imamate in Yemen and the “Islamic emirate” in Afghanistan under the Taliban, than to a republic in which Mousavi, or anybody else, could claim a mandate based on victory in an election.

Khamenei’s sermon also contains a clear warning that the regime is prepared to provoke a bloodbath to maintain its hold on power. Khamenei says that had the Shah killed half a million people he would not have been overthrown.

He criticizes the Algerian Front for Islamic Salvation (FIS) for not having called the masses onto the streets and provoked a bloodbath by confronting the army. “Had they brought the crowds onto the streets there would have been an Islamic government in Algeria today,” he says. “But they were afraid and showed weakness.”

With admiration, the “Supreme Guide” recalls the massacre of one million Communists in Indonesia under General Suharto that he claims saved the system in that country.

A reluctant hero, Mousavi has succeeded in drawing the true battle lines in Iran’s politics. Whether he wishes to be present on those lines, for how long, and with how much determination remains to be seen.

Amir Taheri’s new book “The Persian Night: Iran Under the Khomeinist Revolution” is published by Encounter Books in New York.