Foreign Relations of the United States, 1955–1957, Near East Region; Iran; Iraq, Volume XII

289. Memorandum From the Acting Assistant Secretary of State for Near Eastern, South Asian, and African Affairs (Jernegan) to the Secretary of State¹

Washington, January 11, 1955.

SUBJECT

• NSC 5402/1, US Policy Toward Iran

Discussion:

NSC 5402/1, US Policy Toward Iran, is scheduled for consideration by the Council at its meeting on January 13.

The policy as now written takes into account (1) the settlement of the Anglo–Iranian oil dispute with the prospect of renewed oil revenue for Iran; (2) the presently favorable situation which offers an opportunity to move forward in building a position of comparative strength in Iran and to change a liability in Asia into a possible asset; (3) the need to assist in developing in the Iranian armed forces defensive delaying capabilities which would make a useful contribution to Middle East defense; and (4) the Department of Defense position that we should not consider undertaking an increased military program prior to receiving the recommendation resulting from the forthcoming US–UK–Turkish area defense study.

The Shah and a pro–Western government have established political stability and, with our assistance, are commencing an economic development program designed to bring to the Iranian people tangible social and economic benefits from the oil settlement.

The traditional Iranian policy of refusing to choose sides in major world conflicts is being abandoned. The Shah told the President, “In abandoning a negative and sterile policy, the Iranian Government and Parliament have made the conscious decision to turn their backs on this form of isolationism and join hands with the leading nations of the free world.”² As further evidence of this trend away from “neutralism,” the Iranian Government is taking strong action in suppressing Communist activities.

The Shah and other key Iranian leaders want to join with Turkey, Pakistan and Iraq in military arrangements within the “northern tier” concept. They feel it necessary, however, to have an Army in which the Iranian people can have some confidence, which could put up an honorable defense against Soviet aggression and which can make some useful contribution to area defense. To achieve such defensive capabilities the Iranian Army needs our help in training, reorganization, improved equipment and in preparation of defensive positions. For political and psychological reasons beyond purely military considerations, the Department of State continues to believe that it is important to increase military aid to the Iranian Army if Iran is to join regional defense arrangements and to continue to resist Soviet pressures with courage and determination.

The Department of Defense is reluctant to increase military aid at a time when world–wide military aid requirements are using up available funds. Defense and the Joint Chiefs of Staff also feel that no decisions on this subject can be taken until after a military review of all Middle East defense requirements has been completed. The military have suggested language in Paragraph 21 of NSC 5402/1 which would require decisions on the amount and rate of military and defense support aid for Iran to be “controlled by” various factors which, in our view, should read “directly related to” but not “controlled by.” The Defense position would run the risk of giving more weight to technical considerations than to the more important political and psychological elements of the unusual opportunity which is open to us in Iran today.

Recommendation:

(1) That the policy be approved as proposed, excluding the Defense–JCS suggestions in Paragraph 21.

(2) That Ambassador Loy Henderson be asked to accompany you, and give an oral statement regarding the situation in Iran.

1. Source: Department of State, S/S–NSC Files: Lot 63 D 351, NSC 5402—Memoranda. Top Secret. Drafted by Baxter, Kitchen, Dixon, and Stutesman and concurred in by S/P, G, EUR, and E.
2. The source of this quote is unclear. The only record found of the Shah’s conversation with President Eisenhower is the summary in telegram 1175 to Tehran, December 13, 1954, Foreign Relations, 1952–1954, vol. X, p. 1073.