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100. Telegram From the Embassy in Iran to the Department of State/1/ Tehran, September 13, 1965. /1/Source: Department of State, Central Files, POL IRAN-US. Top Secret; Sensitive; Priority; [distribution indicator not declassified]. No time of transmission is given on the source text. 355. Re Deptel 292./2/ Department and White House may be confident I wish cooperate to utmost in meeting critical intelligence requirements. Fully understand gravity of problem. If Embtel 332/3/ seemed unresponsive, it is simply that I do not want our interests here to follow same ill-fated course they have in Pakistan. Reftel suggests USG prepared to take greater risks here than would normally be wise. With that assumption, following views are submitted: /2/Document 99. /3/Document 98. A. Scope of Facilities 1. Existing sites. Although I have not visited all sensitive sites here, and in particular I have not been to [less than 1 line of source text not declassified], observations to date indicate that current quarters are being quite fully utilized. Small additional amount of extra equipment, however, can probably be installed in each of them (with possible exception of [less than 1 line of source text not declassified]). My hope would be that transfers from Pakistan could be limited to such modest expansion. 2. New [less than 1 line of source text not declassified]. Previous thought has already been given to [1 line of source text not declassified] building much needed warehouse. If additional housing is needed for facilities transferred from Pakistan, least risk would of course occur if they housed on compound. Proposed warehouse might be converted into [less than 1 line of source text not declassified]. Such new construction might however take minimum six months. I do not favor construction new ostentatious installations elsewhere than [less than 1 line of source text not declassified]. However, if Washington decides there is no alternative perhaps best [5-1/2 lines of source text not declassified]. This might make project palatable to Shah. As general rule any major new installations [less than 1 line of source text not declassified] should be discussed with Shah. 3. Consultations. While burgeoning American presence is indeed problem here, it is less explosive than new [less than 1 line of source text not declassified] installations. With all due respect to "top U.S. intelligence authorities concerned" it would seem to me that an Ambassador is entitled to know specifics of additional facilities contemplated [2 lines of source text not declassified]. Accordingly, I would appreciate consultations here within next week or 10 days with "top U.S. intelligence authorities" who can describe in detail each project desired and how it does not duplicate something already existing. As soon as their ETA received I will gladly reserve whole day for these mutual consultations. Incidentally, I would appreciate their bringing clarification whether [1-1/2 lines of source text not declassified] is functioning in accordance with money invested. B. Political Parameters 1. Bird's eye view. As Dept knows, particularly during present Indo-Pak tension, Shah is badgering us re West's lack of appreciation his friendship. He appears to be shifting Iranian policy so as to reduce his image as "American stooge" and give impression Iran has "independ-ent" policy more consonant with mainstream of Afro-Asian nationalism. His subjects, taking cue not without some relief, inevitably tend to swing too far. There is current trend in government circles, press and public opinion treat Western interests much more critically and coolly. While both Shah's shift and public allergy been developing over long period of time, they have developed markedly within past six months, and most specifically after red carpet treatment he received in Moscow. Much of this change is rooted in series of grievances re which Iran has felt lack of US attention. 2. Need for total policy. From my own experience, I know how Washington is compartmentalized. Issues between U.S. and Iran during recent months been handled pretty much without full realization their effect on total U.S.-Iran relationship. Impression around Washington is Iran is now "rich" country and, therefore, we can shift our attention elsewhere. As a result, most of these individual issues have not received sympathy in Washington which Shah and Iranians feel they deserved. Ergo, the U.S.-Iran relationship is not as healthy as it was. Shah asked me again last night, "Does Washington really care for Iran?" 3. Grievances. Since Iran's grievances inevitably bear a relationship to Iran's receptivity to what we might wish to do here, it may be worth reviewing some of key irritants. If these can be gotten out of way, climate for introduction of at least some part of needed facilities would be somewhat improved. A. Military Aid. Shah has become increasingly resentful re our military aid program. While extending grant aid to countries less faithful to our cause than Iran, we are requiring him to pay for high percentage his procurement from us. We agreed on 4-5 percent interest and promptly applied 5 percent rate. He must repay in dollars. (Meanwhile Soviets are offering steel mill, and MIGs, at much lower rate with repayment in Iranian products.) There are other aspects of our military program which because of their restrictive nature tend to offend Shah's sensitive pride but they stem from our legislation and there is little we can do about them, e.g. limitation on his helping Iran's ally Pakistan. B. Economic Aid. Because Iran is "rich," we understandably have tapered off grant aid and are phasing out technical assistance programs. Loans via Eximbank and commercial banks are still available, but stand in stark contrast to Soviet blandishments, i.e., long term loans at 2-1/2 percent interest with repayment in Iranian products notably natural gas (exploitation of which has long been futilely asked by Iranians of oil consortium). C. Gudarzian. Shah, his family and his govt simply cannot understand how a crook like Gudarzian can in highly civilized US perpetrate gigantic hoax as Gudarzian has against Iran Prince and Princess. Nearly hundred thousand dollars already been spent by Iranians to free $200,000 in funds attached via Gudarzian's hoax. USG been working hard in both civil and criminal suits, but it is difficult to convince Oriental mind like Shah's that after 18 months something more could not have been done in matter so close to friendly Chief of State. D. Fairhurst Case. As Iranians see it American businessman who invested only $200,000 is using blackmail of Congressional pressure to extort $5,500,000 for his personal profit. E. PL-480 Food. Iranian requests for from 100,000 to 300,000 tons of PL-480 Title IV wheat have apparently gotten stalled in notorious red tape of Agriculture Dept. F. Iranian Students. Re-stimulated by his recent New York stopover, Shah remains aggravated by apparent USG inability to do something re anti-Shah "students," some of them over 40 years old who have already been in US decade or more. G. Steel Mill. Iranians complain that for number years they been relying on Western interests for steel mill but response was always evasive. Now that Soviets have made attractive offer Iranians somewhat irritated by Western admonitions re dangers of dealing with Soviets. Shah points out to virtually every listener that students in US demonstrate against him, students trained in England almost assassinated him this spring, so what worse can happen if he sends technicians to be trained in Russia in connection with steel mill. H. Literacy Conference. Current UNESCO Literacy Conference in Tehran is spectacle dear to Shah's heart. He is less than pleased by our understandable coolness to his pet idea of devoting military funds to World Literacy Program. 4. Symptoms of coolness. Recent evidences of cooling Iranian attitude toward US: A. Shah's limited responsiveness to our appeals not to jog surgeon's (UNSYG's) arm in current Indo-Pak crisis. B. Clear indications that Shah will accept new Soviet economic offers, including probably steel mill. C. Shah's increasing disaffection with CENTO. D. Resentment over breakdown of Fairhurst negotiations and Congressional pressure in connection therewith. E. Restoration of three years' hard labor sentence on American engineer Bredin for the alleged murder of his wife. Higher court had earlier reversed this verdict and milder sentence was anticipated. F. [1-1/2 lines of source text not declassified] G. GOI turndown of our Embassy's appeals for diplomatic exemption from gasoline taxes. This relatively minor matter but is straw in wind. H. Similarly $2,000,000 GM contract with Ministry Water and Power for mobile generators was voided by higher authorities. C. Recommendations While I do not believe that even if these current irritants are removed, traffic here will bear introduction of full complements from Pakistan envisaged in Deptel 193,/4/ I do believe that if we want to expand our facilities in Iran and obtain approval as appropriate from Shah, we will have to improve climate as soon as possible. Following steps recommended: /4/Document 94. 1. Enlist White House assistance in calling off Senators McClellan and Kuchel from exerting ill-considered public pressure in Fairhurst case. There is not a moment to lose in making them aware that they risk endangering very important facilities here. 2. A suitable memento and really forthcoming warm message from President on the occasion of 25th anniversary of the Shah's reign, as already recommended. 3. Action to ensure that Iranians obtain truly concessional interest rate for second tranche of military sales agreement. If we say that 5 percent is already concessional, why can we not give evidence of greater effort to produce greater concession? Our military sales are pivot of our military relationship with Iran. More can and must be done here to improve climate. 4. A high level push to come through with decision re PL-480 wheat. We could really make points both with Shah and public opinion if at least some part of transaction would be in Title I. Increased foreign exchange crisis here should provide justification. 5. A clean-cut steel mill proposition. While prospects are that Soviets have this project almost in hand, our only hope will lie in tidy package which has some attractive features to counter-balance favorable Soviet interest rate and repayment in natural gas. 6. Continued U.S.G. pushing for expeditious judicial verdicts against Gudarzian. 7. Court action against at least one or two vagrant Iranian students. Also reply to Shah's frequent requests that we investigate where these "professional students" get their means of support. 8. Over long range, high level U.S.G. review of treatment of countries where aid programs being curtailed. We seem to swing between extremes. Once we decide a country, e.g. Iran is off list, it casts pall over almost every tangible tie. Specifically, we should have means to counter attractive loan terms offered by Soviets who gleefully pick up credit proj-ects in countries we deserting. 9. Also over long range do something about US laws which permit crooks so easily to attach stateside bank accounts of foreign leaders. Certain New York lawyers are making good living by these nefarious practices. Not only is there Gudarzian case, but Saudi bank accounts are being attached and also accounts of Hashemite family, all under most flimsy grounds and all to detriment our national interest. While this is bit lengthy, it seemed appropriate to paint picture on wall. Such understanding is necessary to obtain receptivity of both Shah and Iran people for closer relationship reflected in installation of additional [less than 1 line of source text not declassified] facilities here. Believe specific questions asked in last two paras Deptel 193 are all answered in this full presentation. Meyer
101. Memorandum From Robert W. Komer of the National Security Council Staff to President Johnson/1/ Washington, September 16, 1965, 10 a.m. /1/Source: Johnson Library, National Security File, Country File, Iran, Vol. I, Memos & Miscellaneous, 1/64-12/65. Confidential. The whole purpose of your exercise with the Iranian Ambassador at 11:45 this morning is to make a big splash over the 25th anniversary of the Shah's coming to the throne./2/ /2/Shortly before noon on September 16 in the Oval Office, President Johnson presented Iranian Ambassador Khosro Khosrovani with a message and gift for the Shah commemorating the 25th anniversary of his accession to the throne. For text of the message, see Public Papers of the Presidents of the United States: Lyndon B. Johnson, 1965, Book II, p. 1002. While the Shah didn't compromise much of his pro-Western virtue in Moscow, the Soviets made handsome enough offers (steel mill, non-aggression pact) to start the Shah worrying again. He's stood foursquare behind us on Vietnam, but Meyer is sure he's worried by our seemingly slow progress there. He doesn't want to become another Diem, and whenever he worries about his destiny he begins to see rust on his westward anchor. So this, like your call to him in New York, is mostly massage. However, you could add a specific touch by asking the ambassador to relay your thanks for Iranian help with American evacuees from Lahore. Also, the Shah has just gone out on a legal limb to grant clemency to an American who got wound up in the Iranian courts and was recently sentenced. So a word of thanks for this personal favor in the "Bredin case" would be a nice touch. Lloyd Hand is sending you separately a memo on details of the ceremony./3/ /3/Not found. R.W. Komer/4/ /4/McGeorge Bundy initialed under Komer's signature.
102. Telegram From the Embassy in Iran to the Department of State/1/ Tehran, September 24, 1965, 1110Z. /1/Source: Department of State, Central Files, DEF 19-8 US-IRAN. Confidential; Priority. Repeated to CINCSTRIKE. Passed to DOD and the White House at 8:45 a.m. 469. Pass Komer White House. DOD for Kuss. U.S.-Iran Military Cooperation. As Embassy has previously reported, Shah has become increasingly unhappy with his virtually complete dependence on U.S. for military supplies. He considers there have been intolerable delays, too much back-seat driving "from 10,000 miles away", undesirable gaps such as in air defense, and discrimination in sense that Iran, one of few Afro-Asian countries to support us in foreign policy matters (like Viet Nam), is forced to pay for its supplies on virtually commercial basis while other less friendly nations receive both military and economic aid at more generous terms. Just prior to Central Bank Governor Samii's departure for U.S. to negotiate financing of "second tranche." Shah was startled to learn that while our agreement envisaged interest terms between four and five percent we at outset immediately jumped to five per cent figure. With this background, a crowning irritation for Shah has been discovery that when he wanted to send token military help to Pakistan to assist Iran maintain dialogue with Ayub during recent Indo-Pak crisis, U.S.G. bluntly and categorically put its foot down, not just re MAP supplied hardware but also supplies purchased via U.S.G. guaranteed credit and even straight sales which require USG licensing. In bitter tone, he spoke exasperatedly to PriMin Hoveyda in front of me, "We are not free." When signing various military agreements with U.S., Shah was, of course, aware restrictions incorporated. They were, however, at time somewhat academic. Now full meaning has come sharply to his realization. This comes at time when in general foreign policy is tending toward move designed to alter what he considers his "American stooge" image in Afro-Asian world. There is no doubt in my mind Shah will make definite effort to decrease his military dependence on US. In fact, there is already evidence coming to Embassy that he intends to do it promptly. He will be seeking procurement from non-American sources. Even Iranian procurement from Soviets cannot be ruled out (Shah has told me Soviets offered him MIGs during his recent Moscow sojourn). While we may not be able completely to forestall Shah's move to loosen his military cooperation ties with U.S. (including CENTO), there is much to be said for our maintaining that cooperation to the maximum extent possible. Certainly we should seek to avoid having pendulum swing too far in other direction. With this end in view Embassy once again appeals to Dept and DOD to conjure up some means (perhaps through appropriate component of USG financing) for reducing interest rate for "second tranche" purchases as close as possible to four percent figure. In addition to Samii, Iran FinMin Amuzegue also now in Washington. Advising them that more favorable terms have been arranged would do great deal to shore up our position in Iran, specifically as far as military cooperation is concerned. Meyer
103. Letter From President Johnson to the Shah of Iran/1/ Washington, October 5, 1965. /1/Source: Johnson Library, National Security File, Special Head of State Correspondence File, Iran--Presidential Correspondence. Confidential. Sent to the President for signature under an October 5 memorandum from Komer calling it a "friendly but carefully non-committal reply" to an attached message from the Shah appealing for U.S. support in getting a Kashmir settlement. (Ibid., Memos to the President, McGeorge Bundy, Vol. 15) Your Imperial Majesty: I greatly appreciate your recent letter on the conflict between India and Pakistan,/2/ and welcome its words of wisdom. I am wholly in agreement with you that the resolution of the Security Council obliges all of us to seek a settlement of the underlying political problems that divide those two great nations. /2/The text of the message, sent by telegram, was delivered to the Department of State with a September 27 covering letter from Ambassador Khosrovani to Assistant Secretary Hare. (Ibid., Special Head of State Correspondence File, Iran--Presidential Correspondence) The firm policy of the United States Government is to search for a peaceful settlement between the two countries through the United Nations which is the instrument we have agreed should act in these matters. We stand ready to lend our best efforts through the Security Council to assist as we can. As you and I are well aware, this task will not be easy. The issues between India and Pakistan have resisted solution for some eighteen years already, and I hope that the recent fighting has not made them harder rather than easier to resolve. I am aware of and admire the statesmanlike roles played by Your Majesty, Prime Minister Hoveyda, and Ambassador Ansary in support of the successful efforts of the United Nations to achieve a cease-fire. Your thoughts on how we can move forward to lasting peace as relayed by Ambassador Meyer have been interesting and useful. It is clear to us that as the United Nations seeks solution to the problem, Iran can provide constructive support by encouraging and strengthening Pakistan's ties to the Free World. Because of our deep mutual interest in a stable subcontinent, I look forward to continued close consultations and exchanges of views with you as India and Pakistan seek, with the help of the United Nations, a solution to the troubles which have plagued them for so long. Sincerely yours, Lyndon B. Johnson
104. Telegram From the Embassy in Iran to the Department of State/1/ Tehran, October 27, 1965, 1100Z. /1/Source: Department of State, Central Files, POL 23-1 IRAN. Secret; Exdis. 650. For General Taylor. Ref: Deptel 509./2/ Threat of insurgency in Iran is in latent rather than active stage. Thus, our efforts and those of GOI are directed as much towards prevention as towards improving capability to deal with insurgency if it occurs. Overall US objective in Iran (preservation this country from domination by elements inimical to US interests) is at present best served by furthering progress already made in economic, social and political development while recognizing that Shah represents vital element of stability. Thus, our unremitting efforts are directed toward development and implementation number courses of action many of which have counter-insurgency implications. /2/Dated October 22. (Ibid., POL 23-1 COL) GOI authorities, from Shah down through military, security, and police echelons, are all aware of importance counter-insurgency operations, and GOI has improved its posture by launching own programs in fields of health and sanitation, literacy, land reform, vocational training and civic action. Since inauguration civic action programs in Iran (1962) there has been noteworthy change in public image of Iranian military and gendarmerie and attitude of general public toward gendarmerie and military has altered visibly for better; similar changes have taken place in attitude military toward civilian population. Civic action thus has played material role in decline of insurgency threat and pacification of tribes. Greatest danger to stability, as brought out by events of this year, comes from small groups of fanatics who might assassinate Shah but who have no significant capability for insurgency themselves. (Embassy's A-105)/3/ Second major problem, in my opinion, is narrowness of base of regime. (Embassy's A-281)/4/ However, this is not insurgency problem but tied to personality of Shah. In short while due attention is given by Country Team to potential insurgency threats from tribes, mullahs, and dissatisfied urban elements, Iran in my judgment is a situation where further refinement of counter-insurgency programs is less important than encouraging well-conceived economic development and broader based institutionalized government. /3/Dated August 17. (Ibid., POL 2 IRAN) /4/Dated October 20. (Ibid., POL 23-1 IRAN) Am satisfied with progress being made in Iranian counter-insurgency preparations and at moment I see no major problems. This is why in our last progress report on IDP I recommended that Iran be taken off special group list requiring periodic review. As reported in Embassy's A-281 current situation here better than it has been for some time. However, in our regular and continuing process of analysis Iranian political environment we are, of course, constantly alert to any signs of increase in counter-insurgency threat or its potential. I am fully aware of advantages for prompt attention at highest levels USG which special group provides and would seek assistance promptly this channel should changing conditions here seem to justify. I regard our IDP as adequate and geared to Iran's present requirements. I consider that I have authority to utilize all resources of US agencies within mission to insure efficient execution of US responsibilities under IDP. Country Team fully effective in counter-insurgency field and there are no conflicts between US agencies regarding roles and missions. I believe attitude of local authorities towards insurgency threat is healthy one. GOI appears to be increasingly aware of importance of counter-insurgency programs and local authorities are susceptible to advice on that score. With regard to our ability to evaluate local conditions in sufficient time to take preventive action against a subversive threat, our sources appear to be adequate. [2 lines of source text not declassified] US and GOI interests in this field are almost identical and I consider GOI sources as reasonably satisfactory. Embassy, Consulates, [less than 1 line of source text not declassified] have certain capabilities in this field, [1 line of source text not declassified]. In general, I am satisfied with level of training of my staff in counter-insurgency theory and practice. However, since Iran poses problem like many other countries where we are endeavoring strengthen economic and social fundamentals of regime over long run against possible insurgent or subversive forces, suggest training courses stress particularly appropriate utilization positive techniques aimed at encouragement of constructive evolutionary forces. Officers all agencies should be trained accordingly to approach whole issue with constructive mentality rather than as simple matter fire-fighting after open conflagration has commenced. Meyer
105. Telegram From the Embassy in Iran to the Department of State/1/ Tehran, November 12, 1965, 0950Z. /1/Source: Department of State, Central Files, DEF 19-8 US-IRAN. Confidential. Repeated to CINCSTRIKE, London, Bonn, Baghdad, Ankara, and Karachi. 715. Iran Military Build-up. 1. Build-up Urgent. In discussion with Eximbank President Linder and me 11th, Shah stressed once again that successful economic development of Iran is useless unless Iran has adequate military security. Reiterating many points made previously and those disclosed by FinMin Amuzegar 3 days ago, Shah made clear that in wake of Pak-Indian crisis and procurement by Iraq of new MIGs and British aircraft he considers augmentation his military establishment an urgent necessity. His fears center particularly on vulnerability of Khuzistan and Kharg Island to surprise attack. He said he realized US and Iran have agreement on military program but new facts require additional $200,000,000 expenditures envisaged in request made this week and approved by parliament. 2. US-Iran Cooperation. Pointing to cooperative aspects of US-Iranian military relationship, I said I felt we had formulated effective program for Iran's military security as envisaged in our respective agreements, latest being that of July 1964. If there were certain weaknesses which required amendment it struck me they should be worked out by ARMISH/MAAG Chief Jablonsky and Iranian top military. 3. Alleged Delays. Shah said problem is delay. He said he had been waiting two months for paperwork to be completed re second tranche including determination of interest rate. It not possible with urgency facing him militarily to countenance such delays. I assured him that delay of second tranche paperwork in no way deliberate nor with ulterior motive. Meanwhile, as General Jablonsky has already assured him, we been meeting time schedule for our commitments with remarkable success. 4. Anti-aircraft needs. Shah stressed his anxiety over lack of air defense. He asserted that U.S.G. itself considered certain anti-aircraft guns obsolete and pursuant to U.S. advice Iran disposed of them. Now, however, he realizes that he needs such guns or others to defend his defenseless installations. I noted that General Jablonsky had told him a week ago in their monthly meeting that whole question of anti-aircraft weaponry is under review in US as result of Viet Nam and some definitive decisions expected in December. As he did to Jablonsky, Shah said he would wait until December before he makes any final decisions re this equipment. In talking with me, however, he prefaced his statement emphatically with the word "maybe". 5. Unhappiness re Hawks. When I suggested that in long-range program Hawk missiles were to play a key role in Iran's air defense, Shah virtually exploded in complaining we are limiting him to one battalion. He said it impossible to fragment one battalion and try to defend each of his installations with only one or two Hawk launchers. In addition to his irritation over fact that Iraqis, Egyptians and others have more and faster planes, Shah voiced his unhappiness that Egypt already has eight SAM sites and that both his neighbors Iraq and Afghanistan have such Russian equipment. 6. Decision re $200,000,000 is Firm. Stating he wanted no misunderstanding, Shah said "It has been decided" that additional $200,000,000 worth of urgent military equipment will be obtained. He said he hoped bulk of it would be available from U.S. At same time he gave indication that Iran will be shopping other places and said some military training for Iranians is already planned for Germany. 7. Inadequate Human Resources. I took occasion once again to point out inadequacy of trained human resources in Iran Armed Forces. I said I concerned at prospect of Iran importing more highly technical equipment, when already some supplies not being handled properly. Shah acknowledged this deficiency but asked for examples. This prompted further emphasis on my part that his military and General Jablonsky should be in close consultation./2/ /2/Telegram 591 to Tehran, November 13, noting that any substantial increase in defense expenditures would have a long-range impact on economic development, asked for the Embassy's judgment regarding the Shah's motivations and whether he would seriously contemplate proceeding with a procurement program even if it jeopardized Iran's MAP relationship with the United States. (Ibid.) Meyer
106. Telegram From the Embassy in Iran to the Department of State/1/ Tehran, November 18, 1965, 0720Z. /1/Source: Department of State, Central Files, POL 15-1 IRAN. Confidential; Limdis. 743. Shah's Moodiness. FinMin Amuzegar evening 17th told me that following our conversation 9th (Embtel 702)/2/he sought to explain to Shah valid reasons for delay in US decision re second tranche interest rate. Amuzegar said he found Shah unreceptive. According to Amuzegar, Shah is in glum mood, convinced that Washington is determined to retaliate for his having made steel mill deal with Soviets. /2/Dated November 9. (Ibid., DEF 19-8 U.S.-IRAN) Amuzegar said that in addition to second tranche interest rate issue, Shah cited "What Americans are doing to my brother and sister" in Gudarzian case. According Amuzegar, Shah simply cannot conceive that top U.S.G. leadership could not, if it really wanted to, secure prompt justice for Prince and Princess. I told Amuzegar that by coincidence two U.S.G. attorneys, Kearney and King, presently in Tehran with purpose of explaining to Shah extent to which USG has gone to clear Prince and Princess./3/ I noted it boils down to our determination to have Gudarzian locked up, but this requires necessary Iranian witnesses. Amuzegar said this is precisely what irks Shah, who is convinced that Ebtehaj, as great and good friend of top American leaders, would not fail to testify if that were truly U.S.G.'s desire. Fact that Ebtehaj has refused can in Shah's view, according to Amuzegar, only mean that USG really suggested Ebtehaj not testify and all this is aimed at making Shah squirm because of steel mill transaction. /3/Telegram 759 from Tehran, November 20, reported that the Ambassador, Deputy Assistant Legal Adviser Richard D. Kearney, and Assistant U.S. Attorney Robert King had had a 1-hour audience with the Shah that morning, during which they had emphasized that the U.S. Government had expended great efforts in seeking to put Gudarzian in jail but would not be able to proceed on fraud charges if Ebtehaj and Daftary were not available as witnesses. The Shah expressed his inability to understand why the American system of criminal justice could not convict Gudarzian of forgery or perjury, but he did not indicate willingness to relieve Ebtehaj's apprehensions about testifying. (Ibid., POL 15-1 IRAN) Amuzegar emphasized that he himself realizes all this is pure moodiness on part of Shah but it exists nevertheless. He pleaded that USG make some gesture, as for example quick word re second tranche interest rate, to help break intensified feeling Shah has that USG is determined to take punitive measures against him. Amuzegar said Shah's belief that USG is undertaking punitive measures is heavily influenced by his brooding over Pakistan's plight vis-à-vis U.S.. Meyer
107. Memorandum From Robert W. Komer of the National Security Council Staff to the President's Special Assistant for National Security Affairs (Bundy)/1/ Washington, November 22, 1965. /1/Source: Johnson Library, National Security File, Country File, Iran, Vol. I, Cables, 1/64-12/65. Secret. Mac: Iran interest rate on arms sales. I've held this up for over 8 weeks now, in order to keep it tied to Peshawar package. But we're going nowhere fast, and heat is mounting (see Tehran 743 attached)./2/ /2/Document 106. Case for holding up has been that giving away a goodie too long before we ask for something in turn vitiates the leverage. But State and DOD think the Shah would still remember, and also argue the case for going ahead now anyway on general grounds of keeping Iranians happy. Also Iran is talking about purchasing arms elsewhere at cost to our balance of payments. Past rate has been 5%. State/DOD want to cut it to 3-1/2-4% (ultimately about $350 million in sales over next several years may be involved). Other problem is that McNamara wants to lay off this paper with Ex-Im, thus freeing MAP credit fund for other sales. It will take a WH whip, of course, to get Linder to do this. I favor going ahead now at 4%, so long as I have your backing in beating up Harold when necessary./3/ /3/Next to this paragraph Bundy wrote "OK" with his initials. RWK
108. Telegram From the Embassy in Iran to the Department of State/1/ Tehran, November 25, 1965, 1550Z. /1/Source: Department of State, Central Files, POL IRAN-US. Confidential. Repeated to CINCSTRIKE, Ankara, Baghdad, Cairo, Jidda, Karachi, London, Moscow, and USUN. 776. Shah and US. At outset Thanksgiving Day conversation, Shah agreed with me that time had come for mutually frank discussion. Two-hour session resulted with following highlights: 1. Incipient Divergence. Shah said he had uneasy feeling growing estrangement between US and Iran. Agreeing, I said purpose my audience was obtain better understanding Iran's policies and seek provide him better understanding of USG problems. 2. Rehash of Grievances. Obviously planned, Shah rehashed what he considers unhappy developments in U.S.-Iran relations. This time instead of harking back to Azerbaijan days, he began with mid-fifties and U.S. refusal join CENTO. He also contended U.S.G. sought to dictate Iran's policies from days of Gerry Dooher (who "wanted to be Lawrence of Iran") to Amini days of early sixties. He recalled President Kennedy, during Shah's Washington visit in 1962, had gone out of his way to inform Shah that U.S.G. had two favorite Prime Ministers, Amini and Karamanlis. Amini's premiership had been disastrous. Stating publicly Iran was bankrupt, Amini precipitated tremendous flight of capital and economic depression. More recently U.S.G. has sought to dictate in minutest detail what his military establishment may and may not have. In all honesty he felt Iranian authorities here are in best position to assess Iran's security needs. 3. Relations with Soviets. In rehashing grievances, Shah recalled how in 1959 at insistence his Western allies he rejected offer of non-aggression pact with Soviets. Subsequently whole world witnessed USG attempts to relax relationship with Soviets. When Test Ban Treaty was signed, large U.S. Congressional contingent appeared in Moscow with all sorts of prophecies re new era in U.S.-U.S.S.R. relations. It was only natural, Shah said, that Iran would not want to be left out in cold. Accordingly, Iran began probing Soviet expressions of interest in relaxed Iran-U.S.S.R. relationship. Until now evidence is that Soviet intentions are reasonably honorable. Accordingly, as long as Soviets behave themselves, Shah said he sees no objection to neighborliness particularly in economic field. 4. Steel Mill. Among grievances, of course, was long-standing Western rejection of Iranian aspirations for steel mill. Shah said steel mill had become dream of all Iranians, dramatic symbol of Iran's movement into modern world. So when Soviets made attractive offer, Shah accepted. He acknowledged recent active interest of Western consortia but said their efforts were to no purpose for they could not possibly compete with Soviet offer unless they would make gift of steel mill. He was referring to his well-known thesis that by paying for steel mill with natural gas, until now wasted by flaring, Iran is in effect getting steel mill from Soviets for nothing. 5. U.S. Reactions to Steel Mill. I pointed out to Shah our understanding of Iran's acceptance of steel mill. Realized it had political advantages for Shah as well as economic (he demurred slightly). Noted that during my Washington consultations number of officials had pointed out there benefit to U.S. as well as Iran in relaxed Iran-U.S.S.R. relationship. Shah said he knew this but some "junior officers" have been "critical." I took occasion to point out that number Iranians misquote Americans to Shah feeling they can improve their own standing with him by relaying sensational reports. Shah said he fully cognizant of this racket. 6. $200,000,000 Military Build-up. Shah expressed deep gratitude for close U.S.-Iranian military cooperation. He felt, however, that there had been serious U.S.G. misunderstanding of his true needs and this has resulted in glaring weaknesses in his security establishment. He stressed throughout conversation his need for anti-aircraft capability and naval units in Persian Gulf. He did not mention aircraft (General Khatemi has made clear to US that he wants hold to USAF cooperation). 7. Less Favorable Treatment. Shah complained we had supplied military equipment more generously to number countries, including many who have been less staunch friend of U.S. than Iran. Again he recalled his support for U.S. policy in Viet Nam. Shah also said Turks being more favorably treated, e.g. $160,000,000 this year in MAP grant aid, twelve destroyers (to Iran's none), etc. Indicating his figures exaggerated, I pointed out U.S.G. still has sizeable $45,000,000 grant component in Iran program and Turkey does not have $500,000,000 annual oil income. Shah agreed, saying he glad Iran has increasing capability to purchase its military requirements. Problem is U.S.G. unwillingness to supply even when he is willing to pay. 8. Military vs Economic. I pointed out to Shah that from purely selfish standpoint U.S.G. is doing itself disservice. U.S. could use $200,000,000 foreign exchange in view our increasing gold outflow. Fact is our Washington colleagues put Iran's interest above our own. They sincerely believe Iran should limit Iran's military expenditures in favor economic development. Shah said no one excels him in desire for Iran's economic development, paid for with Iranian funds. This launched him on description of progress to date. Including success of his dramatic reform program which, he said, has taken wind out of sails of Communists as well as opposition elements inside Iran. 9. Revised Program. Referring to our 1962 and 1964 agreements Shah said even at time of signature Iranians had indicated their fears that envisaged program would be inadequate. In fact, in letter approving agreements they had noted that situation could change and modifications required. Stressing need for both countries adhere to agreements, I acknowledged that nothing in life is immutable. If threat has altered and if weaknesses have developed in program, they could be talked out and appropriate revisions made. What was hard to explain was sudden unilateral Iranian action. 10. Anti-aircraft Plight. Shah said he had several times sought to make clear to US his deep concern re anti-aircraft defense. He had highest regard for U.S. military but even they can make mistakes. In Viet Nam only eight percent American aircraft being shot down by missiles; 92 percent by ground-fire. This has precipitated total revision US military thinking re anti-aircraft defense. Unfortunately, previous erroneous evaluation is partly responsible for Iran's lack of air defense. 11. Naval Units for Gulf. Noting vulnerability Kharg Island, vital importance Khuzistan and increasing number off-shore drilling operations, Shah said he simply must have naval capability in Persian Gulf. US has steadfastly denied him destroyers. He is determined to obtain that type vessel. He feels his need is as valid as is that of Turkey. 12. Arab Threat in Gulf. Shah said he realizes U.S.G. does not consider Arabs as threat to Iran. I corrected him to say that we consider threat less formidable than does he. Re Iraq, Shah said just last week four Iraqi tanks crossed Iranian border and captured small Iranian mule train falsely suspected of carrying arms to Kurds. Nasserism could without too much difficulty take over Kuwait or other Gulf principalities. Syria has openly advocated Arab move on Khuzistan. Iraq has same objectives, even though only Qassim stated them publicly. 13. British Withdrawal. Shah predicted by 1968 British will have withdrawn from Aden and by 1970 probably from Gulf principalities. I called his attention to fact that Iran Del at UN had joined wolf-pack in voting resolution against British in Aden. Shah said Iran had no alternative but to vote against colonialism. Meanwhile, since British influence one way or other will be withdrawn, Iran remains single constructive free world power capable of protecting commerce and peace in Gulf area from predatory elements including Communists. 14. Saudi Potential. Shah said he looks forward to Faisal's forthcoming visit to Tehran. While disturbed that Saudis seem be able obtain substantial equipment from U.S. and U.K. in contrast to his own less successful efforts, Shah said he welcomes military strengthening of Saudis. Asked whether Saudis might play role in security of Gulf principalities (as for example by federation), Shah said he saw no objection, provided such consolidation was definitely non-Nasserist. Shah added Iran has no territorial aims on Gulf's southern shore (he did not even mention Bahrain). 15. Syria. Referring to Syria, I expressed view that Damascus pronouncements are chronically so wild that no one pays any attention to them. By reacting as Iranians did to Syrian PriMin's statement re Khuzistan, it merely convinces Arabs this is an issue re which to make more noise. Shah professed to agree. 16. Shah in President's Shoes. In trying explain U.S. problems, I asked Shah to put himself in President's shoes. I expressed opinion that Presidents are products of their times. Eisenhower was chosen over very able Stevenson because Americans at that point wanted complacency and approved Eisenhower's father image. Kennedy captured American imagination with theme that he wanted get U.S. on move again. World liked Kennedy because of his quivers and arrows foreign policy. (I noted in passing that Shah's complaints re U.S. intervention via Amini stemmed from days when under Kennedy leadership US was trying play more active role in world affairs. In any case, Amini was Shah's choice not that of U.S. Shah said Amini had been intriguing for job since his days as Ambassador in Washington.) I said U.S. people have become increasingly disillusioned. After two world wars and $110 billion in foreign aid, all to preserve freedom abroad, there is epidemic anti-Americanism in numerous foreign countries. We know it only represents minority who loudmouthed and who by melodramatics capture press headlines. Pity is that some leaders cater to such demagoguery. Americans too are human beings. They resent failure of other people appreciate their endeavors. They doubly resent indignities such as having their SecState spat upon. They want their President take hard look at foreign relations. This is what President Johnson is doing. Where there is aggression as in Viet Nam, President takes vigorous action and U.S. people overwhelmingly support such policies. But fact that they have to do this thankless job (240 lives lost last week alone) virtually alone causes them to pause. Shah recalled his own support in world capitals for US policy in Viet Nam and expressed apparently sincere view that American boys are "fighting gallantly" in Viet Nam. 17. Hard Look at Aid Projects. With above background, I said it not surprising Congress been increasingly critical foreign aid program. It is my understanding President himself is personally checking all foreign aid commitments. Shah said he understands this natural American attitude. He felt problem with foreign aid was "way it was handled", e.g., too many strings, etc. I said reason Congress injected one proviso after another was increasing public concern at lack of foreign appreciation. 18. Second Tranche Paper-work. During conversation Shah spoke with utmost seriousness re delay in completing second tranche paper-work, which was to have been finished when Samii was in Washington two and half months ago. What worries him most, Shah said, is that if Washington can delay paper-work in this way, same "uncertainty" can apply to Iran's supply of military equipment. I reiterated that until now there been no interruption in supplies as scheduled. Shah again referred to Pak experience. He realized we would say Iran is different but even if there is "only one chance in million" that Iran would find itself in same plight if Pan-Arab dispute arose, he could not take that chance. He said some of his military are now in Europe checking on anti-aircraft and naval equipment. He sincerely hoped early answer would be received from Washington re second tranche since he would "hate to move" in direction which would neither be in U.S. or Iran's interest. He reiterated his desire to work in close harmony with us and to "buy American." 19. Soviet Aim; Rupture U.S.-Iran Military Cooperation. I called Shah's attention to current output of Communist-bloc anti-Iranian clandestine broadcasting stations. Major attack is on U.S.-Iran military cooperation. Noting that he has chosen to go along with first stage of classic Communist strategy, i.e., alliance of Communists with national aspirations, obviously Soviets now concentrating on second stage, i.e., disrupting Iran's ties with West. I sincerely hoped Shah would block this Soviet move. Shah said it is U.S. which by second tranche delay is aiding Soviet objective. I closed conversation by quoting Arab proverb "You can't clap with one hand" and expressed hope nothing would intervene to disrupt basic friendship which exists between our two countries including our military cooperation. Shah cordially agreed. Meyer
109. Telegram From the Embassy in Iran to the Department of State/1/ Tehran, November 25, 1965, 1830Z. /1/Source: Department of State, Central Files, POL IRAN-U.S.. Confidential; Limdis. 778. Personal for Secretary. FonMin Aram tells me that after my two-hour session with Shah Thanksgiving Day (Embtel 776),/2/ Shah told him he and I had laid all our cards on table. But Shah, according to Aram, still asks, "Why don't Americans understand we want to be their friends?" /2/Document 108. From Washington, world situation may look different, but from here I (hopefully not just due to localitis) believe that Shah remains true friend of everything in which we believe and that we can ill afford disaffection of another country. Accordingly, I would appreciate your personal intervention with White House to break loose long-delayed paper-work re second tranche of our military program with Iran. It should be with interest rate of four percent. If this unsalable please get it out whatever the rate but hopefully less than five percent. Aram also recalled your conversation with Shah last April in which you proposed periodic (3 to 6 months) reviews of all subjects of mutual interest. Shah and I are getting along fine. But in his present blue mood, Shah needs evidence that Washington still loves him. Therefore, please do your best to assure that in foreseeable future some high ranking U.S.G. official drops in at Tehran to hold Shah's hand. Aram suggested you yourself during one of your travels. He agreed, however, that George Ball or Averell Harriman could do the job. I cannot stress too strongly that our relations with Iran are at cross-roads. Shah wants to go on same course with U.S. I am sure this is in our country's interest. If feasible, show this message to President. Despite poison of Gudarzian fiasco, Shah trusts President, recalling his visit here in 1962. Shah asks little. Can't we keep this country in free world camp? Meyer [Continue with the next documents] |
