139. Telegram From the Department of State to Secretary of State Kissinger 1

Tosec 80313/183077. Subject: Proposed Assignment of Defense Representative to Tehran. For the Secretary from Ingersoll, Maw and Eagleburger.

1. Summary. You will recall discussion here two weeks ago with Dick Helms on DOD proposal to establish new top management position in Tehran, to be called U.S. Defense representative, Iran (DefRepIran).2 Your initial reaction to this proposal was negative.3 After a long discussion with senior Pentagon officials and with Department’s Deputy Inspector General for Foreign Assistance, we believe the case merits your reconsideration.4 We are persuaded that mushrooming De[Page 416]fense programs in Iran are not under control and have potential for becoming major Congressional and foreign policy headache, and that Helms needs top management assistance to avoid this. Approval of DOD proposal would put us in position to say to Congress that Executive branch had recognized problem and was already taking steps on its own to deal with it. We believe Shah would welcome this move, but we would of course have Helms discuss it with him before moving ahead. We will want to discuss this with you, as will Schlesinger when you return. Purpose of this message is to give you a chance to reflect on proposal in advance. End summary.

2. At DOD request, General Counsel Marty Hoffman and DSAA Chief General Fish met at Department July 30 with the Acting Secretary and several other Department officers including Maw, Eagleburger, Atherton, Vest, Leigh and Constandy (Deputy IG of Foreign Assistance). They laid out in greater detail than we had heard before the problems of managing the DOD operation in Iran and the reasons why they want to assign a super manager to Tehran. The principal problems are (A) the tremendous expansion of FMS programs in Iran, now totalling over $9 billion in orders with over $7 billion on delivery; (B) proliferation of DOD units in Iran, now including about 25 operational entities (e.g., Gendarmerie Advisory Mission, various intelligence detachments, Armed Forces Radio/Television, Defense Mapping Agency, USAF Weather Wing, etc.), which do not fall under command of the major unit, ARMISH–MAAG; (C) division of ARMISH–MAAG itself along service lines with resulting difficulties of competition and gaps in coordination; (D) increased need to monitor activities of private U.S. defense suppliers who are crowding in on Tehran in search of contracts; (E) emerging evidence that some major U.S. defense suppliers have paid unapproved agent fees;5 (F) increasing Congressional concern over the expansion of our arms sales to Iran, with prospects of further efforts at Congressional oversight.

3. Constandy recently headed a small, informal security assistance inspection team to Iran. He came up with indications of slack management and possible outright irregularities pointing to current need for full-fledged formal inspection. We have agreed that such inspection should be undertaken without delay and will be getting in touch with Helms as a first step. Meanwhile, Constandy has independently come to conclusion that there needs to be tighter top DOD management in Tehran along lines of current DOD proposal.

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4. Although theoretically the senior DOD rep now in Iran (Chief of ARMISH–MAAG) could be given such greater responsibilities as Pentagon now proposes for new DefRepIran, Pentagon maintains that two-star rank is not enough. One possibility would be to go to Congress for authorization to assign a three-star General. Pentagon argues that it is strongly preferable, in current situation, to assign a senior civilian as DefRepIran to insure stronger civilian control and overcome inter-service rivalries. Individual the Pentagon has in mind is Eric Von Marbod, current Principal Deputy Assistant Secretary of Defense (Controller). As you may recall, he played effective coordinating role in our security assistance program to Vietnam. Several of us in Department are acquainted with Von Marbod and have very high regard for him. Assuming DefRepIran is assigned, proposal is that Chief of ARMISH–MAAG, a USAF Major General, will be designated as his deputy. Current Chief of ARMISH–MAAG is scheduled to depart in near future and his replacement would arrive to take his place under the new management system if DefRepIran position is established soon. Von Marbod has worked well in past in Country Team situations.

5. Terms of Reference. DefRepIran would be member of the Country Team under the direction of, and reporting to, the Ambassador. His principal mission would be to supervise and coordinate all DOD activities in Iran (excluding Defense Attaché and Marine guards which remain under direct Embassy supervision). He would be responsible for formulating, coordinating and presenting DOD positions in Iran within framework of overall USG policy, and monitoring security assistance activities. He would report to Sec Def through CINCEUR, CJCS and ISA/DSAA in accordance with established guidelines, under overall local direction of the Ambassador and keeping the Ambassador fully informed of all aspects of his work. DefRepIran would be authorized an additional staff of up to eight military and civilian personnel, but major staff and legal support would be provided by ARMISH–MAAG.

6. We are acutely sensitive to risks of creating new two-headed (civilian plus military) monster over our Defense activities in Iran. Dick Helms expressed concern that establishment of new top Defense position could tend to undermine his own position as the President’s representative and the single U.S. official in charge of all our activities in Iran.6 The Pentagon knows of this concern and has taken pains to emphasize that DefRepIran would be member of the Ambassador’s team and serve under his policy guidance and supervision. (He would be [Page 418] provided with explicit written instructions on this point, subject to State’s review and approval.) They maintain that having better top-level Defense management will enable the Ambassador to carry out more effectively his own role as the senior U.S. official in country. They have also emphasized that Von Marbod has proved his ability to work effectively with our Ambassadors abroad. (Phil Habib is a strong supporter of Von Marbod from his work in Southeast Asia.)

7. Schlesinger intends to call you after your return, to solicit your support for the DefRepIran proposal. We are told that DOD proposal also has support of General Brown.

8. If you agree, we would plan to get in touch with Helms and ask his own reconsideration and agreement to the DefRepIran proposal, based on the considerations outlined above. If he agrees, we will then wish him to check the idea out with the Shah before we move ahead any further.

9. This message is concurred in by Atherton, Vest and Leigh. Sisco is not in town and has not seen this message, but he has expressed support for the DefRepIran concept.7

  1. Source: Library of Congress, Manuscript Division, Kissinger Papers, Box CL–153, Iran, Chronological Files, 1 August–26 September, 1975. Secret; Immediate; Nodis. Kissinger accompanied President Ford to Europe July 26–August 4.
  2. Helms was in Washington July 15–19 to testify before the Senate Select Committee to Study Governmental Operations with Respect to Intelligence Activities, known as the Church Committee after its chairman, Senator Frank Church. The committee was investigating covert assassination attempts against foreign leaders and domestic spying conducted by the Central Intelligence Agency under Helms’s tenure as Director of Central Intelligence. The discussion of Iran has not been found.
  3. Kissinger initially opposed the proposal for a civilian Defense representative in backchannel message 3648 to Tehran, July 15. (Ford Library, National Security Adviser, Backchannel Messages, Box 4, Mideast/Africa, Outgoing 7/75)
  4. In telegram Tosec 80306/183065, August 2, Eagleburger explained to Kissinger that there was a “major scandal brewing” among U.S. Defense representatives, military contractors, and the Iranian Government: “Management of our FMS program and other military sales programs in Iran is, at best, a mess. At worst, there are major illegalities.” He assured Kissinger that the Department of State could reach agreeable terms of reference for the position with Defense. (Ibid.)
  5. The Iranian Government had prohibited the use of agents appointed by military contractors to secure government contracts in exchange for fees, thereby raising the cost of arms purchases. The rules were clarified in telegram 4807 from Tehran, May 21. (National Archives, RG 59, Central Foreign Policy Files, D750180–0923)
  6. Helms expressed this concern to Scowcroft in backchannel message 169 from Tehran, July 13. (Ford Library, National Security Adviser, Backchannel Messages, Box 4, Mideast/Africa, Incoming 7/75)
  7. Telegram Secto 8126 from Belgrade, August 3, conveyed Kissinger’s continued opposition to the proposal. (National Archives, RG 59, Central Foreign Policy Files, [no film number]) However, in telegram 198172 to Tehran, August 20, Eagleburger advised Helms that the Secretary had agreed with the Defense Department to establish a Defense Representative in Iran, fully responsible to the Ambassador, for one year. (Library of Congress, Manuscript Division, Kissinger Papers, Box CL–153, Iran, Chronological Files, 1 August–26 September, 1975) Telegram 8361 from Tehran, August 27, notified Eagleburger that the Shah accepted the assignment of Von Marbod as the Defense Representative in Iran. (National Archives, RG 59, Central Foreign Policy Files, D750297–0067)