Foreign Relations of the United States, 1948, The Near East, South Asia, and Africa, Volume V, Part 1

891.00/9–3048

Memorandum of Conversation, by the Assistant Chief of the Division of Greek, Turkish, and Iranian Affairs (Dunn)

secret

[Washington,] September 30, 1948.

During the course of a conversation with Ambassador Ala today—at the Embassy, in view of his continued illness—the following points of interest emerged:

(1) The Ambassador stated that he wished to convey to me informally the purpose of the conference presently planned for Monday, October 4, between Mr. Ebtehaj and himself for the Iranian Embassy and Mr. Satterthwaite and other officers for the Department. I was informed that Mr. Ebtehaj will wish to discuss political and military, as well as economic, aspects of U.S.-Iranian relations; in particular Mr. Ebtehaj and Ambassador Ala will inform the Department that the Government of Iran wishes to clarify its foreign policy, making clear its disposition no longer to placate the Russians or to pursue a policy of balance but to commit itself definitely to the cause of the western powers. In taking this new, positive position, Iran would, according to Ambassador Ala, be following the example of Turkey. Ambassador Ala explained that he had for long recommended this course of action to His Majesty the Shah and that Mr. Ebtehaj has also shared these views. It appears that the Shah and Prime Minister Hajir are now prepared to act affirmatively on these recommendations. It was understood that Iran’s new policy of commitment to the western democracies would soon be confirmed officially in Tehran by publicly announced requests for U.S. assistance to meet Soviet threats, “like Turkey”.

(2) Against a background analysis of Iran’s important strategic position, which was considered similar to that of Turkey, the Ambassador said that his government was about to make specific requests of the U.S. In the military line, Iran would request more U.S. officers “to reform the Iranian Army”, apparently by detailing U.S. military personnel to the divisional level. It is the hope of the Iranian Government that Iran might be so equipped as to offer effective delaying action to the Soviet Union in the event of hostilities.

(3) Overall political assistance will be sought through the medium of a regional pact which Ambassador Ala envisaged as comprising Iran and eastern Mediterranean states. The Ambassador has had several talks with the Turkish Ambassador in Washington and at least one conversation with the Greeks and Egyptians. The purpose of such regional arrangement, in effect an extension of the Saadabad Pact, would be mutual defense. Its effectiveness would depend upon the extension of the Marshall Plan aid. The Ambassador referred to recent press reports of Ambassador Griffis’ statement in Cairo.

(4) Economic assistance through established media will be sought from the International Bank, with which Mr. Ebtehaj has already been in conversation; the Eximbank, covering credits for agricultural machinery; Smith–Mundt Act arrangements for the detail of U.S. Government and other technicians; and U.S. private investment in local Iranian enterprise under Iranian Government guidance. The Ambassador stated that he would like the Department’s views concerning the Prime Minister’s request to Mr. Wiley with regard to possible credits up to $80 million covering consumer goods for the purpose of reducing the cost of living in Iran. I referred to the observations which Ambassador Wiley had made to the Prime Minister in Tehran, together with considerations of our financial experts in Washington which recommended against the economic validity of such a means for achieving the admittedly worthwhile objective.

(5) In view of the prospect of Mr. Ebtehaj and Ambassador Ala making elaborate requests for U.S. assistance along the above lines, I reminded the Ambassador that American resources were not unlimited; that we appreciated the desire of other free nations to associate themselves with the western democracies in opposing the spread of Communist totalitarianism; that this government was disposed to share its resources, insofar as possible, with foreign governments pursuing a similar policy; that this government, in the final analysis, had to take responsibility for deciding where and when its assistance might best be accorded; that the wisdom of its decisions had been demonstrated by situations which have developed and are emerging abroad at the present time; that U.S. assistance in all events was premised upon the conscientious effort of recipient countries to make every contribution to their defense possible within their own competence; and that, in the case of Iran, we were conscious of our commitment under the Tehran Declaration.

(6) Concerning the Shah’s expressed desire to visit the U.S., the Ambassador stated that His Majesty wishes to come in the spring, but that Ambassador Wiley has suggested next September as more advisable. When asked the Department’s views in this connection, I told the Ambassador that we had long been of the opinion that the mutual interests of our two countries would be well served by a visit from the Shah at the earliest appropriate opportunity and that we had been thinking in terms of next spring. On the Ambassador’s insistence, I promised him a more definitive answer on Monday concerning the Department’s present views as to the most auspicious time for His Majesty’s visit to the U.S.

[Here follow numbered paragraphs 7 through 10, dealing with matters of lesser importance.]