788.00/3–2350: Telegram

The Ambassador in Iran (Wiley) to the Secretary of State


520. Inform Army, Navy, Air. Yesterday Shah told Prime Minister Saed and ministers fight against corruption must be postponed “for reasons of state”.

He then accepted collective resignation of Saed government and a few hours later appointed Ali Mansur to form next government.

This morning Dooher had three hour talk with Prince Abdor Reza, Dr. Taqi Nasr and Prop. Chief Shahrokh.1 Dooher on my instructions endeavored to avert by discreet suggestions abrupt and dangerous reaction on their part. He was successful to following extent:

Prince Abdor Reza will develop diplomatic ailment and withdraw from active participation in economic affairs. He will not however openly oppose Shah or even Mansur.
Dr. Nasr will decline post already offered him in next Cabinet. He will make statement of his reasons for doing so but will not attack Shah. He will not leave Iran for time being.
Shahrokh will remain in post of Prop. Chief. He will, however, develop serious attack of writers cramp and produce no propaganda for new Prime Minister. His function, from Abdor Reza’s standpoint, will be to keep Prince informed of developments in government, including expect misappropriations and possible intrigues with Soviets.

Shahrokh has seen Mansur twice since appointment. Prime Minister had long talk with Shah last night at which it was reportedly agreed [Page 491] Shah would choose half of Cabinet and Mansur remainder. Mansur apparently wants Bader, Ex-Minister Finance and currently head of Meshed Shrine Foundation, as Minister Finance. Bader has unsavory reputation in financial matters and presumably would fit into Mansur’s plans. However, Shah may insist on Golshayan for reasons of AIOC policy.

Nasr expects Ebtehaj now to execute about face on credit policy and pour money into Bazaar in order to give Mansur government economic shot in arm. If this is done, Nasr believes, Ebtehaj, despite background of patriotism and honesty will have hitched his wagon to most corrupt and self-seeking elements in country.

Immediate mass reaction to Shah’s appointment has been one of bitter disappointment and, if possible, deepening of general feeling of frustration. Shah’s reputation as crusader against corruption, tenuous though it was, has been diluted.

Curiously enough strongest reaction against Mansur’s appointment is within court itself.

Sent Department 520, repeated Moscow 58, Dhahran 41 for McGhee, Department pass Moscow.

  1. Bahram Shahrokh, Director General of Propaganda.