888.2553/1–552: Telegram

No. 140
The Ambassador in Iran (Henderson) to the Department of State1

top secret


We are disturbed at developments which nearly terminated visit here reps Int Bank. Especially disturbing feature is apparent lack understanding on part bank re sitn here. We have gained impression from discussions reps bank that their principals did not realize kind problem which they wld meet in Iran. Reps seemed to have come here with idea they were to deal with persons who might be swayed by representations of logic and reason. They apparently even thought that it might be possible to prevail on Govt Iran for bank to bring in large number Brit oil experts. We gather that during their initial conversations with Mosadeq and other Iran officials they hopefully used same sound arguments and appeals as have been made repeatedly without effect during recent months by whole series of persuaders.2
We are not critical these two reps. They clearly are able men, qualified to handle themselves creditably in usual and unusual sitns if they know what those sitns are. The manner in which they seem to have been briefed and the basis on which their mission appears to have been founded emphasize, however, the gulf between the type of thinking which they had come out here to express and the realities of the sitn in Iran. We are inclined believe that bank [Page 304] has been enveloped by the unrealistic atmosphere … still seems to be pervading London.…
Experiences of bank strengthened our feeling that time may be at hand for US seriously consider whether it can afford much longer to defer to Brit leadership in this area. We agree rift between Brit and ourselves re ME might well result in frustration policies both countries that area and its eventual loss to international communism. We also realize that there is widespread view in UK that continuance Brit leadership in ME is symbol that Brit is still great world power and that forfeiture this leadership to US might strengthen anti-US feeling in UK and throughout empire with perhaps disastrous results to whole free world. Nevertheless, unless Brit display more constructive interest this area it seems to us we cannot much longer ignore fact that they have lost touch with events; that if we allow ME to deteriorate because of our consideration for Brit sensibilities, consequences can be extremely serious.
Not necessary in this tel try prove Brit have been systematically misjudging Iran sitn for at least last two years. Research analysis of documents in Dept’s files will show that Brit have been stubbornly refusing recognize dynamics sitn here. London still seems of opinion forces of natlism are temporary phenomena which will disappear in due course. There is tendency among Brit officialdom in London to insist their prognosis wld have been correct if US had not upset their plans by attitude from which Iran natlism drew encouragement. They seem to ignore fact that US has gone so far in this endeavor to be loyal to its Brit partner as to create impression in Iran and elsewhere in ME that US is following Brit lead in this area. US may not have openly supported Brit to extent which many Britishers wld have liked. If we had given US all out full support result wld, in our opinion, have been victory not for AIOC, but for internatl communism.

. . . . . . .

We suppose Iran will be one of subjects discussed with Churchill3 and are hopeful that even though this telegram is of superficial character and though it may contain no new ideas, it may serve strengthen resistance to possible pressure on part Churchill that US let UK have free hand in this area, that it at least do nothing of constructive character here unless UK agrees. It would be helpful [Page 305] to free world if Churchill could be brought to understand that even though countries in this area may not be so great and strong as Soviet Russia or Communist China, UK will be making grave error if it takes attitude towards them no less considerate or respectful than it might assume if they were in great power class. Iran like various other countries of ME is in certain respects acting in irresponsible and foolish manner. We do not believe that answer is to heap ridicule or “to let it step [steep] in its own oil”.

We admit it is hard to find just what right answer is but are confident it cannot be found unless we approach problem with at least certain amount of sympathy and great deal of patience. This problem is not one to which standard political or economic formulas or remedies are applicable nor one which we can afford merely to ignore. We sincerely hope that Churchill will be big enough not to permit such considerations as British prestige or profits prevent him from agreeing to reexamination of whole problem with idea of finding new approach, main objective of which would be to start Iran oil flowing to sources where it could be used and to close gap which at present is stretching wider and wider between Iran and free world.

  1. Transmitted in two sections and repeated to London.
  2. On Jan. 10 the Department informed Ambassador Henderson that Garner wished Henderson to know that the principles outlined in his letter of Dec. 28, 1951, to Mosadeq were merely a reiteration of the substance of the Bank’s discussions with Mosadeq in Washington; that Garner had informed Mosadeq while he had been in Washington that the Bank did not envisage the exclusion of all British personnel from the oil installations; and that Bank representatives had in fact suggested to Mosadeq a division of the proceeds of the sale of Iranian oil. Thus, the Bank had no indication that Mosadeq would object to the conditions which Garner set forth in his letter of Dec. 28. (Telegram 1402; 888.2553/1–552)
  3. Prime Minister Churchill and other officials of the British Government, including Foreign Secretary Eden, were in Washington for a series of conversations with their U.S. counterparts, Jan. 5–18. For documentation regarding these talks, see vol. vi, Part 1, pp. 693 ff. Regarding the future course of Anglo-American policy in Iran as discussed in these talks, see Document 142.