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101. Memorandum From the Assistant Secretary of State for Near Eastern, South Asian, and African Affairs (Byroade) to Secretary of State Acheson 1

I suggest you read the attached three British messages from Middleton in Tehran. The first one gives an excellent analysis of the situation and Middleton’s conclusions prior to withdrawal by Mosadeq of his arbitration offer. The second message describes how that offer was withdrawn, and the third message gives some indication of thinking of both Henderson and Middleton as to the present situation.2

I have agreed with the British that we would send messages from London and Washington today requesting a joint analysis of the new situation by Middleton and Henderson and their recommendations as to the course of action to be followed immediately by the US and UK, including recommendations as to possible alternatives to Mosadeq, method of bringing such a government into power, and the type of encouragement and support that would be necessary in such circumstances.

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We are considering, in some cases in conjuction with CIA, every possible alternative on our part to save Iran. This includes the probable position of the British and ourselves with the local tribes, which could be a big factor in any coup d’état type of action. Another thing still to consider, and in this probably the British would not agree with us, is whether the US and UK should take the initiative with Mosadeq in offering him a much simplified settlement of the oil issue in return for our immediate assistance.

I am leaving this afternoon for a much overdue appointment with the Doctor (nothing serious). John Jernegan will clear such a cable with Matthews, and if Doc thinks necessary with you. I have informed the British that I will call them if such a cable meets with the approval here in the Department.

  1. Source: National Archives, RG 59, Central Files 1950–1954, 888.2553/7–2952. Secret; Security Information. Drafted by Byroade. A note indicates Acheson saw this memorandum.
  2. The British messages cited by Byroade are not attached and a note indicates they were returned to GTI on August 6. They were apparently copies of cables sent to London from Tehran provided by the British Government. The first referenced message might correspond to a copy of a telegram from Middleton, no earlier than July 28, in which Middleton describes Mosadeq’s arbitration offer. (Ibid., GTI Files, Lot 57 D 155, Box 44)See also footnote 2, Document 99. No message describing Mosadeq’s withdrawal of the offer of arbitration was found. In telegram 416 from Tehran, July 27, Henderson reported some tentative conclusions about the situation in Iran after consultation with Middleton. Henderson wrote that although he agreed with Middleton that Mosadeq was a “particularly unsatisfactory person,” a response to Mosadeq’s offer of arbitration should be made in a conciliatory spirit. “Proposal advanced by Mosadeq to Brit Govt as basic step toward oil settlement shld be considered most seriously as possibly last chance for such an arrangement. If it is not accepted as basis for serious conversations and pressed in good faith, Front extremists may not give Mosadeq another opportunity.” (National Archives, RG 84, Tehran Embassy Files, 1950–1952, classified general records, Box 29)