The Chargé in Iran ( Ford ) to the Secretary of State
[Received May 23—4:05 p.m.]
359. Prime Minister summoned me today to lengthy conference attended by Hajir,2 Forouhar,3 Adle,4 Bayat,5 and later Millspaugh. Gist of Prime Minister’s long discourse was that present economic situation in Iran was intolerable and that Millspaugh system was incapable of handling both financial and economic matters. To solve this crisis and to relieve Millspaugh of a load he was no longer able to carry Saed suggested the creation of a Ministry of Economy under Mosharref Naficy to absorb all economic departments of financial mission as well as some of the divisions of Ministry of Commerce and Industry, with present American economic personnel being transferred to new ministry. Millspaugh was of course unalterably opposed to this suggestion which he said would completely wreck the economic structure he has slowly built up and which is only just now beginning to show results.
At the outset of conversation I informed Prime Minister that I did not believe the adviser in general and Millspaugh in particular were receiving the cooperation to which they were entitled and which they sorely needed. Saed vigorously denied this assertion and endeavored to point to many instances of his support. I agreed that he himself had been a tower of strength but that unfortunately this had not been the case in most other instances. Saed stated that he does not wish the advisers to go (including Millspaugh) and looks forward to American assistance to Iran both during and after the war. I informed the assembled Ministers that I trusted they were not permitting themselves to be stampeded into any hasty action by the present press [Page 406] and Majlis campaigns against the advisers, which was also denied, as was a suggestion I made that this project was a device artificially concocted to ease Millspaugh out of the country with a minimum of embarrassment.
Department will recall that this move, also involving Naficy, was tried shortly before Millspaugh’s arrival in Iran (Legation’s No. 76, January 22, 19436) but was blocked at that time. The present interjection of Naficy into the picture may be a bid to enlist British support in the campaign against Millspaugh or may possibly indicate British opposition to our adviser program despite Bullard’s reiterated reassurances to the contrary.
No conclusions were reached at this meeting, Prime Minister requesting me to talk matter over with Millspaugh and let him know our recommendations. After consultation with Millspaugh this evening I shall probably see Saed again tomorrow or Wednesday for further discussion.