306. Memorandum From the President’s Special Assistant (Rostow) to President Johnson1
SUBJECT
- The Shah’s Visit—Follow-up Actions
You will recall that the Shah put six specific questions to you. Attached are (1) a letter for the Shah answering these questions and (2) instructions for Armin Meyer to use in explaining your answers.2 We have been relatively responsive, but we have not been able to do everything the Shah has asked us to do. Therefore, the letter is straightforward in saying what we can and cannot do. Following is the reasoning behind each of our answers, arranged in the same order as they are mentioned in your letter:
[Page 544]1. What assurance can we give the Shah so he can plan on obtaining arms on good financial terms from the US for his five-year program?
It is still not possible for us to give the Shah any categorical assurance that he can depend on USG credit in the future since we do not know what authority Congress will give us to sell arms on credit. We believe the best offer to make right now is for you to promise the Shah to speak to your successor about your relationship with him and the importance of our continuing cooperation. We have already given him a general assurance that the Executive Branch will urge Congress to fund a continued program, but your personal offer to intervene with your successor might be a sufficiently attractive new element to make him feel that we are doing everything possible.
2. Can the US provide USAF technicians to help Iran learn to maintain the F–4 aircraft it is buying?
We are prepared to send fifty supervisory-level personnel for a one-year period to begin with if the Iranian Government will pay for them. We had already planned to send three USAF mobile training teams for a shorter period to help Iran handle its first F–4’s this fall, but we could send a mission for longer. However, with limited military aid funds and our balance of payments problem, it would be hard to justify to Congress our paying for these extra people over a period longer than that required for familiarization with the new equipment.
3. What is the best military way of protecting the entrance in the Persian Gulf against the Soviet fleet?
JCS does not like the Shah’s proposal to station land-based missiles at the entrance to the Gulf because they are too expensive, too uncertain, and too vulnerable to attack. JCS would rather see the Shah rely on a combination of his Air Force and some good missile gun boats. We would give the Shah this preliminary JCS reaction and offer to study the question further with him if he wishes.
4. How can we speed up planning and construction of the Shah’s radar and military communications systems?
Both of these projects still require decisions by the Shah’s Government. We have already turned over several preliminary engineering studies. We do have proposals for helping the Shah decide exactly what he wants and for speeding completion. But your best response to his question, rather than get into these details, is to offer full discussion of these alternatives by our Ambassador and military chief in Iran.
5. What role can the Northrop 530 aircraft play in the development of Iran’s Air Force?
We would keep the door open for Iran’s possible participation in this plane’s development. But since it is still in the design stages and is [Page 545] not planned for production before 1975, we would suggest that the Shah move cautiously before committing much money.
6. Can the U.S. buy more oil from Iran?
This is the toughest. The best we can tell the Shah is that the Defense Department would buy more refined products at competitive prices if such products are available. This would not amount to too much because we already have a long-term contract with ARAMCO to buy Saudi products through the refinery on Bahrain. What the Shah really wants is for us to increase purchases of crude oil from the National Iranian Oil Company. Theoretically, we could do this by giving Iran a special import quota or by bartering Iranian oil for US exports. The main problem with both methods is that we would have to change our whole import quota system and would thereby open ourselves to requests for similar treatment from our other oil-producing friends, upset Venezuela and stir up a domestic hornet’s nest. He will be disappointed, but we suspect he will be prepared for this answer.
I believe the Agencies have given these questions a fair look. The answers are not entirely what the Shah might hope for. But they are reasonably responsive and he should recognize this. The attached letter is for your signature if you approve, and beneath it are more detailed instructions for Armin Meyer.
- Source: Johnson Library, National Security File, Special Head of State Correspondence File, Iran, 7/1/68–10/31/68. Secret.↩
- See Document 307.↩
- This option is checked on the source text, and a handwritten note indicates the Department of State was informed that the President signed the letter on July 25.↩