788.5/4–2952: Telegram

No. 174
The Secretary of State to the Embassy in the United Kingdom1


5535. Fol for ur use in replying Eden’s comments (re Embtel 48842 rptd Tehran 206).

US announced at time that mil assistance to Iran had been suspended effective Jan 8 as result Iran’s failure comply with provisions Sec 511a MSA. Also announced that communication had been recd from Mosadeq which permitted continuation technical assistance program.3 It was made clear that conversations with IranGov re assurances for mil aid were continuing and that it was hoped satisfactory arrangements wld be worked out. Such conversations were in fact continued between Amb Henderson and IranGov. Brit–Emb here were informed upon this matter. Shah and mil leaders were seriously concerned over suspension mil aid and exerted constant pressure upon Mosadeq to give required statements. Mosadeq [Page 380] and Shah knew from early stages of negots minimum statements which wld be accepted by US, and cld at any time have concluded matter permitting resumption mil aid. Largely if not entirely as result pressure from Shah, Mosadeq decided reluctantly and in opposition extremist elements in Cabinet make required statements which were incorporated in his note of Apr 24. In announcing this action Dept made clear to press Apr 25 that this related solely to mil aid.4

Prior to receipt Embtel and démarche by BritEmb rep Wash,5 Dept recd Tehran’s 41626 reporting that Mosadeq Govt creating false hope US preparing large-scale finan aid to Iran and hinting resumption mil aid only beginning various kinds new assistance from US. Amb Henderson suggested Dept find earliest occasion make clear no new change in US policy re econ and finan aid to Iran.

Completely aside from Brit approach, Dept naturally disturbed at indications IranGov creating erroneous impressions concerning import Apr 24 exchange of notes and will endeavor further clarify matter in press statement today, which will be subj separate tel.7

In discussing matter with Eden suggest you point out (a) Dept assumed Brit knew status of matter and likelihood exchange of notes wld take place at any time; (b) US mil group in Iran was not withdrawn under assumption aid wld be resumed at early date; (c) principal motivating force in exchange of notes was Shah who was earnestly alarmed over possibility losing US mil aid, since he knew that if assurances not given very soon mil aid earmarked for Iran wld have to be transferred to other countries in order permit obligation before June 30; (d) US, having made it clear only impediment to continuing mil aid was lack of assurances, and having made clear from inception of discussions nature of statements required, cld not very well refuse accept them when offered, and (e) development is not entirely to Mosadeq’s polit advantage since for [Page 381] first time he has been forced to retreat from previously announced position under direct pressure from Shah. Polit advantage at best can be temporary and once US position clear, Dept confident no harm will result.

Believe you took proper initial line with Eden and hope above will reassure him. Appropriate legislation Sec 511a of MSA of 1951, not 408.

  1. Repeated priority to Tehran. Drafted by Rountree and approved by Matthews.
  2. In telegram 4884 Ambassador Gifford reported that Foreign Secretary Eden had telephoned him on Apr. 28 to express his disappointment with the apparent failure of the United States to inform the British in advance that a military assistance agreement was being concluded with Iran. Eden also claimed that the United States, by its action, had given Mosadeq a new lease on life, as he was conveying the impression that this agreement represented a U.S. decision to extend financial aid as well to Iran. The Ambassador said he had tried to reassure Eden that the accord contained no new provisions; that Mosadeq simply had complied at last with the requirements of the Mutual Security Act. Eden, however, refused to accept this explanation. He was concerned about the domestic political ramifications of this event, as it created the impression that the United States and United Kingdom were divided over policy vis-à-vis Iran. (788.5/4–2852)
  3. W. Averell Harriman, the Director of Mutual Security, made these actions public on Jan. 22 in letters addressed to the Chairmen of the Senate Foreign Relations, House Foreign Affairs, and House Armed Services Committees. For the text, see Department of State Bulletin, Feb. 11, 1952, p. 238.
  4. See footnote 5, supra.
  5. On Apr. 28 representatives of the British Embassy protested the conclusion of the military aid agreement along the same lines as Eden had to Ambassador Gifford. Department officials responded with the same observations which were sent to London in telegram 5535. (788.5 MSP/4–2852)
  6. In telegram 4162 Ambassador Henderson reported that Mosadeq was suggesting that the military aid accord foreshadowed the granting of large-scale financial aid as well. (888.10/4–2852)
  7. The Department informed Gifford in telegram 5543 that the Department’s statement of Apr. 29 regarding aid programs for Iran would be in that evening’s Wireless Bulletin. (788.5/4–2952) In telegram 2497, May 8, the Department informed the Embassy in Tehran that the Department had given the British Embassy in Washington copies of the news conference transcript as well as a copy of the statement used by the Voice of America. Moreover, the Embassy was informed that the transcript of the news conference was not published by the Department. (788.5/5–752)