891.00/1937: Telegram

The Minister in Iran ( Dreyfus ) to the Secretary of State

362. My 359, November 4. British Legation has again altered attitude toward food declaration and now takes view that [in] view [of] serious deterioration of situation in Iran, the declaration should be made only against greater concessions and assurances on part Iranians. They believe it is useless to obtain satisfaction on currency matter alone only to be presented later with new problems and demands which will require concessions and negotiations. They consider now is time set stage for complete Iranian cooperation. British Minister is therefore telegraphing London recommending British and American[s] (if United States agreement can be obtained) are prepared support Qavam or any other Iranian Government only in following circumstances:

Iran Government must be prepared support war effort and to give assurances that hoarding laws will be enforced, rials guaranteed, price control instituted, press controlled and security maintained.
To enable Government carry out these engagements Government should seek full powers from Majlis for 6 months or year.
Allies may call on Prime Minister to modify Cabinet as they see fit.
Food declaration will be given only against Iranian acceptance above condition.

British Minister in his cable admits this course of action may lead to fall of Government and even necessity of use of force but states that alternative is political and economic chaos. He also states he is now considering composition of alternative governments.

Seems to me certain that Majlis will not grant these full powers nor even those outlined in my 350, October 30. Result of attempts to obtain their compliance will be fall of Qavam either through resignation or no confidence vote. In this event British must be prepared (1) to install alternative government which will close Majlis, throttle press and generally do Allied bidding or (2) occupy Tehran and set up Quisling government.

It would appear that British have determined on policy of presenting Iranians with demand that could not possibly be accepted with ultimate intention of occupying Tehran and setting up puppet government. Their reasons for this are not clear but may include (1) honest belief that present confused and unsatisfactory situation can only thus be remedied or (2) intention of getting Iranian situation under control (see my 361, November 6 as to Fifth Column plot) in view of possibility of German threat toward Iran this winter.

I am in agreement with British that Government should seek full powers from Majlis and have gone so far as to suggest this course informally to Prime Minister. This is necessary to eliminate destructive influence of Majlis, to be able to control irresponsible press and to accomplish anything substantial. However, I am not convinced that the British have chosen the proper method of accomplishing this aim and I cannot conscientiously recommend that we support these new British demands. I am hopeful that the same thing can be accomplished by the use of informal and friendly, but firm, pressure on Government.

I am anxiously awaiting Department’s reply to my 350 in order to inform Qavam who has been summoned to Majlis session Sunday for interpellation on food situation. I fear the new British move reported above will so confuse the situation that Qavam’s position will become untenable.