Office of the Historian

53. Memorandum From the President’s Assistant for National Security Affairs (Brzezinski) to President Carter1

Washington, November 23, 1979

SUBJECT

  • SCC Meeting on Iran (C)

Attached is the Summary of Conclusions of the SCC meeting this morning.2 Two items are of particular note:

—Bani Sadr’s statement that Iran will not honor its financial obligations3 may do more to destroy Iran’s international standing in the economic community than anything we can do. For the moment, we should just monitor the effects. By tomorrow we will give you a recommendation on whether or not the Export-Import Bank should declare Iran in default. They have never declared a nation in default, and this would further dramatize Iran’s precarious economic position. (S)

—A decision will be required in the next week or so about allocation of crude oil stocks and production of gasoline. DOE and Eizenstat’s office are looking at options.4 (C)

  1. Source: Carter Library, National Security Affairs, Staff Material, Office File, Box 17, SCC Meeting #209 held 11/23/79. Secret. Carter initialed “C” in the upper right corner.↩
  2. Not attached. A copy is in Carter Library, National Security Affairs, Staff Material, Office File, Box 17, SCC Meeting #209 held 11/23/79.↩
  3. On Friday, November 23, Bani-Sadr announced that Iran intended to default on all its foreign debts, estimated at more than $15 billion. He later stated he meant only the debts of 28 private banks, not those of the Iranian Government or central bank. The decision affected U.S. banks (Chase Manhattan, Bank of America, Continental Illinois, Citibank, First Boston Co., and Mellon Bank) and European banks, the latter not having access to frozen Iranian assets. Bani-Sadr presented these two decisions as creating the economic independence necessary for a break in relations with the United States. (Jonathan C. Randal, “Iran Says It Won’t Pay World Debts,” Washington Post, November 23, 1979, p. A1)↩
  4. Brzezinski informed Vance, Miller, and Duncan that Carter had approved two other recommendations from the November 23 SCC meeting: There would be no effort to determine the size of the Shah’s assets in the United States, and the United States would not attempt to discourage Japan or others from making oil purchases from Iran. (Memorandum, November 26; Carter Library, Brzezinski Donated Material, Box 13)↩