128. Memorandum From the President’s Special Assistant (Rostow) to President Johnson1

The Shah answered your last letter2 almost immediately. He obviously wants to assure you that he is not neglecting his economic revolution in pressing for more arms. He details his achievements—combating illiteracy, improving rural life and public health, bringing new land under modern cultivation, development of a fertilizer industry. Then he explains how growing oil earnings should put Iran on its feet by 1970. Between now and then, however, he will need help in building an effective military while continuing to devote most of his resources to development.

We’re walking a tightrope between bowing to his intention to be master in his own house and keeping his military spending within reason. [Page 229] JCS is now reviewing our recent survey of the Shah’s military requirements. You will have a crack at the final package (much of it will be credit sale), and we will thrash it out with him in our annual military-economic review.

The attached reply, for signature if you approve,3 reassures him that we will not dismiss his security needs lightly but it does not prejudice your final decision.

  1. Source: Johnson Library, National Security File, Memos to the President, Walt W. Rostow, Vol. 1, 4/2–5/26/66.Secret.
  2. Documents 124 and 126.
  3. An unsigned copy of the letter sent on April 11 is attached; see Document 129.