357. Memorandum From the Assistant Secretary of State for Near
Eastern, South Asian, and African Affairs (Allen) to the Under Secretary of State
(Hoover)1
Washington, June 22,
1956.
SUBJECT
- Reply to Ambassador Amini’s
Request for More Aid to Iran2
Discussion:
As a part of its new politico-economic offensive in the Middle East, the
USSR last summer invited the Shah
to visit Moscow. He accepted and will depart Monday, June 25. On July
19, 1955, under instructions, Ambassador Chapin told the Shah of U.S. plans to increase military
aid and put this in the context of considerations relating to a possible
Iranian decision to join the Middle East collective defense
organization. Believing that the newly-formed Baghdad Pact represented
the realization of the American concept of a “northern tier” defense
line, Iran indicated its desire to join but endeavored to attach a heavy
price in terms of U.S. aid and support. Although the U.S. refused to
meet these demands, Iran joined the Pact on November 3, 1955.
Nevertheless, it has been perfectly obvious that Iran (and other members
of the Pact) assumed that adherence would be followed by increased
aid.
In the view of Iranians, the Middle East is now going through a period of
trial during which American firmness and ability to lead the area will
be measured, in terms of the Baghdad Pact and increased aid, against the
effectiveness of the new Soviet politico-economic line as manifested in
Egypt and Afghanistan. The Shah and leaders of Iran generally prefer
open association with the U.S., but they are hedging
[Page 821]
in an effort to determine just how far the
United States will go. They will attempt to compensate for any
uncertainty regarding the United States by improving their relations
with the USSR.
While the real solution to this problem lies in broad policy decisions
affecting the role of the U.S. in this new phase of the Cold War, the
present letter from Dr. Amini can
be answered on other grounds. This letter, like previous messages from
the Iranian Government, is designed to extract maximum advantage from
the situation by encouraging competition between the Soviet Union and
the United States for Iran’s favor. A similar tactic was employed just
before the Shah’s visit to India, when we decided to extend an
additional $20 million for budgetary aid. It would be unwise in our
reply to encourage Iranian hopes for aid at this time since to do so
would only put us in the position of being continually blackmailed.
Although the attached proposed letter to Dr. Amini will avoid this problem, we can, of course, expect
that the question will be put to us again.
The specific points raised in Dr. Amini’s letter can be answered. We can agree with his
comments about the importance of Iran’s adherence to the Baghdad Pact.
We can correct his wild misapprehensions about the scope of our aid to
neutral countries. We can refer to Ambassador Chapin’s promise of increased military aid and point out
that this is being programmed. With regard to helping Iran cover its
increased defense costs, the allocation of an additional $20 million in
grant budgetary aid last spring would nearly cover the increases in the
Iranian defense budget if they chose to use it that way. We have
previously given the Shah our views on how he should conduct himself
during his visit to Moscow.
Recommendation:
That you sign the attached letter to Dr. Amini.
[Tab A]
BACKGROUND FOR REPLY TO DR. AMINI’S LETTER3
- 1)
- In June 1955 the Shah accepted in principle the invitation to
visit Moscow.
- 2)
- On July 19, 1955, the Ambassador informed the Shah of the U.S.
plan to increase military aid and expressed the hope that this
would make it possible for the Shah to proceed with early
arrangements for development of a Middle East collective defense
organization. Reference—Deptel 55 and Embtel 108.4
- 3)
- Embassy reported that rumors heard in Tehran and northern Iran
that as U.S. aid diminishes USSR prepared provide both economic and technical
assistance on large scale. Reference—Embtel 177, August 2, 1955.5
- 4)
- Embassy Tehran expressed the belief that the U.S. is either
“moving too rapidly on the Pact or too slowly on assurance of
minimum aid to Iran clearly implied by our expressed interest in
Iranian Pact adherence . . . .6
If Iran adheres to Pact on urging of Turkey and Pakistan, it
will be on assumption of all three that the U.S. will come
through with necessary aid to make arrangements effective.”
Reference—Embtel 370,
September 1, 1955.7
- 5)
- A personal memorandum from Prime Minister Ala to Ambassador Chapin8 set forth the Iranian price for adherence
to the Pact. The price included:
- a)
- greater financial assistance by the U.S.;
- b)
- recognition of Iranian sovereignty over
Bahrein;
- c)
- the guarantee that the U.S. and UK would come to Iran’s defense in the
event of attack by the USSR.
- 6)
- Department instructed Embassy to explain to Iran that
accession to the Baghdad Pact should not be regarded as a favor
to the U.S. but should be based strictly upon Iran’s estimate of
its own interests. “Although Shah and Prime Minister can be sure
U.S. will do all it can to assist in strengthening armed forces,
believe GOI would err if it
based its policy toward regional defense solely upon the size of
anticipated aid rather than upon its own self-interest and
improved Iranian Middle East prestige.” Reference—Deptel 460, September 17,
1955.9
- 7)
- On October 5 the Shah asked for assurances that if Iran joined
the Pact the United States would issue a statement of support
including a reference to military and economic assistance.10
- 8)
- On October 7 [6] on instructions from the Secretary of
State11 the Ambassador told the
Prime Minister that when Iran formally adhered to the Pact a
statement would be issued by the U.S. Government. However, he
added that, in view of the possibility that Iran’s adherence to
the Pact at that particular moment might be viewed as
retaliation against the Soviet-Egyptian arms arrangement, the
U.S. Government suggests that Iran might do well to weigh the
problem and delay action until the situation becomes clearer
although U.S. views regarding Iran’s adherence to the Pact
remained unaltered.
- 9)
- Despite this caution, the Shah decided to go ahead and join
the Pact and notified the Embassy of this decision within hours
after the above described advice was given.
- 10)
- On November 3 Iranian adherence to the Pact became
effective.
- 11)
- As a result of a misunderstanding between U.S. officials in
Tehran and the Shah regarding the means of implementing the U.S.
commitment to increase aid, it was decided in January 1956 to
add approximately $17 million to the FY 1956 Iranian military aid program. Although this
decision was based partly on the belief that falling off in
military deliveries would be very unfortunate coming right after
adherence to the Baghdad Pact, the United States obtained
little, if any, political credit for this action since the
Iranians had anticipated an FY
1956 program of this magnitude.12
- 12)
-
During February 1956, as a result of Iranian requests and a
continuing budgetary deficit and also for political reasons
related to the Baghdad Pact and the Shah’s trip to India,
$20 million additional budgetary aid was granted to Iran
from the President’s Fund.
Shortly after this was done the Iranian budgetary deficit for
the forthcoming year was increased by about $25 million. The
Shah expressed gratitude for this additional aid, saying “it
goes far to relieve my mind. I have been worried about
evidence U.S. support I can show to counter grandiose offers
which the Russians may make to me while I am there.” Total
figures for U.S. aid to Iran were pointed out to the Shah,
and he agreed they were most impressive and constitute an
ample response to Soviet offers. Reference—Embtel 1454, March 19,
1956.13
On March 9, during a conversation between the Secretary of
State and the Shah, the latter stated that it was difficult
to explain to his people the fact that “neutralism, playing
both sides, seemed to be successful gambit, mentioning that
the Egyptian Ambassador had boasted of blackmailing both
sides to Egypt’s advantage.” The Shah then asked the
Secretary for “perhaps $75 million a year for the next three
years.” The Secretary said that while the U.S. would try to
find ways to help, he thought the figure mentioned by the
Shah was “excessive.” Reference—New Delhi telegram Secto 37, March 10,
1956.14
- 14)
- The U.S. and UK agreed that if
the Shah requests our views we should advise him not to raise
any question of modifying the 1921 or 1927 Treaties during his
visit in Moscow since this would give the
[Page 824]
Soviet Union a lever for
attempting to drive a bargain. It was also agreed that the Shah
should conduct himself in Moscow as a constitutional monarch,
making no commitments. References—Embtel 1696, May 3, and Deptel 2133.15
- 15)
- Another agency of the U.S. Government quoted the Shah as
saying on May 31, 1956, “you have given the Turks 450 planes and
Iran only 2 . . . . How can the U.S. be so casual about our
needs? Our position, my position personally, is greatly exposed.
The Soviets are planning a most elaborate reception. If they
make and publicize great offers without strings, where do I
stand with my people? I do not trust the Soviets, but my people
are desperate for aid, progress and development. They are
impatient. Gold from any hand glitters the same. Tempting offers
are bound to result in great pressures.” When the source
expressed his pleasure that the Shah had had such a successful
trip to Turkey, the Shah replied “I hope you can still say that
after my next trip.”
- 16)
- On June 7 Ambassador Chapin expressed the opinion that we shall have
to face a difficult period with the Shah’s return from Moscow
“when his head will be full of impressions of Soviet might and
of hints and offers of assistance. We must be prepared for
additional demands of assistance by him at this time, and the
Department may wish to consider what we can offer.”
Reference—Embtel 1863,
June 7.16
- 17)
- We agreed with the UK that the
Shah should be advised that if the Soviet Union attempts to
obtain from him amplification of his March 20, 1955 assurances
to the effect that Iran would not become a military base if it
joined the Baghdad Pact, he should not make any new commitments,
but, if necessary, could repeat orally what he had said
previously. Reference—Deptel
2263, June 12, 1956.17
- 18)
- Through a personal emissary the Shah informed the Ambassador
that he was unhappy because, contrary to his expectation, the
U.S. had not increased aid since Iran joined the Baghdad Pact
but on the contrary had cut it. He disavowed any intention to
indulge in Nasr-type
blackmail tactics but reemphasized his need for aid. He seemed
to take the view that by joining the Pact and taking certain
measures to correct the budgetary situation Iran was actually
performing a favor for the United States. He also expressed his
irritation over the fact that the United States has given no
support to Iran’s claims to Bahrein. Reference—Embtel 1884, June 11, 1956.18
- 19)
- The same emissary quoted the Shah as saying, “I have been
receiving aid from the U.S., but they now appear no longer
interested although I still hope they will revise their policy.
In my trip to Russia I must cultivate friendly relations,
because it is possible that, if I can get no more help from the
Americans, I may have to accept something from the Soviets.
Reference—Embtel 1885,
June 11.19
- 20)
- The UK indicated that while the
Shah should not reject all Soviet overtures out of hand he
should be wary of suggestions for the exchange of persons or
joint Soviet-Iran commercial enterprises. The UK would suggest that the Shah might
give favorable consideration to increases in trade
relations.20
- 21)
- On June 14 the Shah reiterated to the Ambassador his
impression that U.S. aid had decreased since Iran joined the
Baghdad Pact. He expressed the hope that it would be possible
for the U.S. to assist in bearing the military budget. He
reiterated his view that the Iranian Army must be strengthened
considerably if it is to take its place in the Baghdad Pact
line. He again referred to the advantages being gained by the
neutrals from “playing both sides of the street.” Although the
Shah expressed his intention to behave as a constitutional
monarch while in Moscow, he continually repeated his belief that
he needs some kind of public assurances of further U.S. aid in
order to bolster his position. Reference—Embtel 1914, June 14.21
- 22)
- Press reports have been appearing in Iran indicating that the
United States plans to increase aid to the Baghdad Pact
countries and has allocated $800 million in aid to these
countries.
[Page 826]
[Tab B]
Letter From the Under Secretary of State (Hoover) to the Iranian
Ambassador (Amini)22
Washington, June 22,
1956.
Dear Mr. Ambassador: I have read your
letter of June 19 with which you enclosed a memorandum describing
the views of your Government on several matters. I have noted your
reference to the departure of His Majesty on June 25 on a visit to
the USSR. Consequently, I have
hastened to reply in order that you may be able to report to your
Government promptly.
First, I should like to emphasize that the United States Government
clearly recognizes the importance of Iran’s adherence to the Baghdad
Pact. We appreciate fully the weighty considerations involved in
accomplishing such a basic reorientation in a traditional foreign
policy. We feel certain that such a major decision was founded on a
careful study of the long-range advantages of regional cooperation
and the increased strength that would result therefrom, rather than
on any short-term tactical advantages which might have been
envisaged.
Similarly, we have noted the series of threats, protests and other
maneuvers launched by the Soviet Union in efforts to prevent the
taking of this decision and then to nullify its effects. We have
also noted the calm firmness of the Iranian Government’s reaction to
these Communist efforts. As the prime target of Soviet threats and
maneuvers for at least ten years, the United States is well aware
that the Soviet Union will adopt any means available to frustrate
the efforts of free nations to seek strength in mutual cooperation.
Many other free nations have resisted such threats and false
inducements for many years and the fact of their steadfast devotion
to the concept of mutual cooperation coupled with the strength
generated by this policy have enabled them to retain their
independence and improve their situation despite the actions of the
USSR.
At the same time, I cannot agree with your statement that in its aid
programs the United States appears to favor certain countries in
direct proportion to the degree to which they have condemned the
United States or approached the Soviet Union. Although I know that
such generalizations have been heard from time to time, I was
surprised
[Page 827]
to know that the
plain facts of the case apparently are not in your possession. There
has been discussion of this point in Tehran between our Embassy and
the Iranian Government.
I believe that the following facts will disclose that in its aid
programs the United States has demonstrated a clear and unequivocal
policy of supporting its friends. A review of United States
non-military aid to non-Communist Asian countries from Japan to
Turkey during the United States fiscal year 1956 shows that such aid
to countries aligned openly in mutual defense systems was
approximately seven times larger than aid to countries which have
chosen to adopt a neutral position. The same figures, when
apportioned on a per capita basis in the countries concerned, show
that non-military aid in those countries formally allied in mutual
defense was about twelve times larger than in the neutral countries.
Over the period from 1950 to 1956 non-military aid to Iran was more
that twice the equivalent aid to all of the Middle East Arab
countries combined. When military aid provided to the countries
associated with collective security arrangements and not provided to
the so-called uncommitted countries is added, the comparison of the
degree of American support is far more striking.
We recognize the desirability of strengthening and improving the
armed forces of Iran and appreciate the burdens this creates. Iran
has been making progress in this direction and we are hopeful it
will continue. We also recognize the need for United States
assistance in this field. I need not relate to you the considerable
size and scope of military aid already provided to Iran. The
intention of the United States to continue and increase military aid
to Iran was confirmed to His Imperial Majesty by our Ambassador on
July 19, 1955, and sizable increases already have been programmed.
It is our plan that such aid in the forthcoming United States fiscal
year will, subject of course to favorable Congressional action on
the related appropriation bill, be provided in significant
quantities.
As for the secondary burden that increased military aid imposed on
Iran, this is a matter of importance since the ability of Iran
usefully to employ additional military aid obviously is a major
factor in determining the extent and timing of military aid
programs. I understand that of the currently estimated deficit of
approximately $53 million in the Iranian budget for the present
year, somewhat less than half is attributable to increased defense
costs. As you will recall, last February the United States
Government, in response to requests for aid additional to the
regular program, made available $20 million to assist the Iranian
Government in meeting its total ordinary deficit.
With regard to His Imperial Majesty’s visit to Moscow, I believe that
he has discussed this matter with our Ambassador, as well as with
the British Ambassador. It is my understanding that he intends to
conduct his visit entirely along lines appropriate for a State
visit,
[Page 828]
deferring any
substantive matters raised by the Soviet leaders for consideration
in consultation with the Government after his return to Tehran. I
believe there is much wisdom in this decision of His Majesty since
this will provide ample opportunity to assess carefully and
deliberately any suggestions which the Soviet leaders may make. In
advance of firm information regarding proposals made by the Soviet
leaders it would be difficult for Iran to plan its next steps or for
the Department to comment on them.
I am quite confident that His Imperial Majesty’s devotion to freedom
and constant support of regional cooperation will be in no wise
influenced by false blandishments any more than by coarse threats. I
believe this so firmly that I should not even have mentioned it had
you not commented on the matter in your letter.
I know that I need not assure you that the United States continues to
regard the independence and integrity of Iran as cardinal points in
its foreign policy and will continue, within the limits of available
funds and its world-wide commitments, to give aid and
assistance.
Sincerely yours,
