The Foreign Service Journal - October 2017

42 OCTOBER 2017 | THE FOREIGN SERVICE JOURNAL between British government and private ownership, and refused to increase Iran’s oil royalties at a time when the country was the world’s largest oil exporter. Turbulence took over, and, when the smoke cleared, emotional nationalismwas embodied in the 1951 coalition government and unilateral uncompensated oil nation- alization was its result. The Iranian-British standoff featured a boycott of Iranian oil and deepening financial depression for Iran. To international concern that the deteriorating situation gave fertile scope for communist subversion, Iran’s eccentric elderly prime minister [Mohammad Mosadeq] merely replied, “Too bad for you.” Time magazine thus started 1952 by naming him its man of the year. The caption: “He oiled the wheels of chaos.”The old man was delighted. Iranian politics by 1953 continued to revolve around the twin pillars of nationalism and monarchy. The shah had not disowned the emotional xenophobia arising from the oil crisis. Prime Minis- ter Mosadeq, controlling the Majlis, or parliament, had taken care to govern in the name of the shah and not to challenge openly his popular position as a traditional symbol of stability and, despite his youth, as a father figure. … Oil Politics When Iranian oil nationalization came, the AIOC believed that it had an effective weapon in an oil boycott, supplemented by foreign court challenges if any distributor dared run the gauntlet. This proved true. Meanwhile, other gulf states were raising pro- duction and servicing Iran’s old markets. The desired implication in those halcyon oil surplus days was that the new National Ira- nian Oil Company might have no place to go. For the Americans, however, the oil impasse, embodying Iranian nationalist frustra- tions and Britain’s desperate need for foreign exchange, was too important an economic, no, strategic, question to fester untended. Before the issue exploded, the United States had confined itself to fruitlessly urging the British to be more forthcoming on royalties and other disputed matters, warning of the heavy conse- quences. To starve out the Iranian government and economy was similarly discouraged. When these courses jelled as policies, how- ever, the economists, Americans included, made solemn periodic assessments on when Iran would have to capitulate. Successive crucial dates passed and the National Front, although frayed, was still there. The give in Iran’s underdeveloped economy was consis- tently underrated. There was not much distance to fall. After the death of Foreign Secretary [Ernest] Bevin, the Attlee Labor government was on unsure ground with his successor, the mediocre Herbert Morrison. Whitehall belatedly recognized that the problemwas too serious to be left to the chairman of the AIOC. British embassy personnel also were gradually changed. However, it was not really until the return of the power of [Win- ston] Churchill and [Anthony] Eden that Iran was moved to the political front burner. Along with their economic strategy, the British had to rec- ognize the concerns of their ally and, in hopeful or pessimistic expectations, approve American endeavors as middleman to find a compromise. Washington initially was reluctant to consider the oil issue as anything but an economic problem and resisted the indicators that it was basically a political question. The United States, at any rate, had the confidence of the Iranians, and thus embarked in 1951 on a persistent refuse-to-be-discouraged line, searching for a magic formula. This was punctuated by diverse visitors to Tehran for discussions with Mosadeq and his principal advisers. American senior statesmen, leading financial experts, oil company presidents, politicians, and a variety of scavenging personalities marked the procession. There was, of course, a large Tehran foreign press colony. Shrewd Iranian politician that he was, Mosadeq talked from the intransigently proclaimed oil policies that gave his political base. In short retrospect, it was clear that he wanted to use foreign U.K. IMPERIALWARMUSEUM/KEATING During World War II British troops attacked the island of Aradian on the River Shatt-el-Arab, at the head of the Persian Gulf, to gain control of a large oil refinery belonging to the Anglo-Iranian Oil Company. Indian troops were landed from assault ships from the quayside, and they attacked the Iranian strong points in the refinery. Here, Indian riflemen stand guard at the refinery.