1953: No US Coup in Iran – We Ally Instead

In STEEPS categorization, this is a Political/Policy counterfactual. It also has implications for the rest of the STEEPS domains, especially Environment (Energy, Resources), Society (Modernization, Rights) and Economics (Entrepreneurship, Capitalism).

The first postwar coup the US instigated against another country, in 1953 in Iran, is particularly helpful for seeing how the clandestine arms of our political system work. It was the first big foreign operation for the newly created CIA, founded in 1947. We were so new in our attempts at social engineering then that most of the story eventually got out in the open, so we can look at it with transparent hindsight today, and find useful lessons for our future.

In 1951, Iran’s parliament elected a powerful, Western-oriented nationalist and populist, Mohammed Mossadegh. He was such an exceptional character for his age, and had so much promise to improve conditions in the Middle East, that Time Magazine chose him as Man of the Year in 1951, a well-deserved honor. Like any good leader, his focus was on modernizing and educating his country, and improving the abysmal living conditions for the vast majority in Iran.

Mossadegh’s populism pitted him against the declining power of Iran’s royal family, headed at the time by the Shah Reza Pahlavi, and the ascending power of the British multinationals that had captured Iran’s oil assets a few decades earlier. British entrepreneurs had developed and sold Iranian oil since 1909. Though they ostensibly offered 16% of the proceeds to Iran, the books were not auditable by Iranians, so nationals had no way of knowing what was going on. Iranians were largely ignorant of technical matters when the first development occurred, and the British assumed that ignorance gave them a free hand. The contracts were put in place in 1923 by the Anglo-Persian Oil Company (APOC), a British multinational, and they had a 70 year term, far too long to be reasonable, and presumably a long enough to drain the fields. Renegotiating those contracts over that ridiculously long time span was never an option for Iran, either in spirit or in letter of the law. It is an irony of history that a young Winston Churchill worked as as a paid consultant on that original and obviously exploitative deal, lobbying the British government in the 1920s to give APOC exclusive rights to Persian oil.

Once elected, Mossadegh didn’t mess around. He nationalized Iran’s oil resources in his first year in office. He then offered APOC a renegotiation of the oil deals, with 50% of the proceeds going to Iran and public auditing of the books. APOC of course flipped their lid. They had a huge political asset in then-Prime Minister Churchill, who did everything he could to fight for both APOC and Britain on the world stage. Nationalization of course does not usually mean socialism, and it would not have been socialism in this case. Many states, especially those in need of technical help, as Iran was at the time, contract with private companies to develop and sell their resources. But when the state takes control over ownership, and then offers back production to private firms under renewable contracts, plutocrats inevitably lose some power.

Churchill took his “Iran problem” to the UN Security Council, but Mossadegh took the shrewd and unexpected step of flying personally to the UN in New York in 1951 to plead his case. He also toured the East Coast on that trip, met President Truman, and Supreme Court Justice William Douglas, then stopped in Cairo, Egypt on his way home, where he was greeted by millions of supporters. He cut an impressive figure with his message of fairer development, and the security council punted on supporting the Brits. On a mix of legal and moral grounds, they wouldn’t give Britain a resolution to denationalize. Churchill then sued Iran in the World Court, but again, Mossadegh flew to Europe to make his case, and he won there as well. Moving on to other tactics, the British embassy in Iran then started to buy off parliament members to build an anti-Mossadegh coalition and throw him out, but Mossadegh got wind of it and closed the embassy, sending the British diplomats home.

Mossadegh’s cleverness left Churchill with few other options, so he turned to President Truman and asked him to help get Mossadegh out. Truman said no thanks, he was too ethical a character to get involved in such shenanigans. Truman instead appointed a diplomatic envoy, the respected entrepreneur Averill Harriman, who flew to Britain and Iran to try to broker a renegotiation of the oil deals. Neither side would shift their position after several meetings, and that’s all Truman would commit to do. He had no interest in meddling in Iran’s internal politics.

Fortunately for Britain, but unfortunately for Iran’s future, Dwight Eisenhower came into office in Jan 1953, and he appointed two powerful brothers, John Foster Dulles as Secretary of State, and Alan Dulles as Director of the CIA. Churchill approached John Foster Dulles with his request that the Americans remove Mossadegh, and the Dulles brothers, far more sympathetic to plutocratic interests than Truman, sold the idea to Eisenhower.

Eisenhower came to office at the tail end of McCarthyism, the anticommunist panic that senator Joe McCarthy stoked across the US in 1950-1954. The Dulles played on these fears, telling Eisenhower that there was a communist party in Iran, and reminding him that Russia was to Iran’s immediate north. They said that unless America had a politician in there that we could trust, Iran might eventually turn communist, or be subverted into communism.

Eisenhower had a deep aversion to war, so much so that he mistakenly imagined a coup strategy would be a reliable way to “get a win” in the Cold War without loss of American lives. Under this advice, Eisenhower gave Mossadegh the cold shoulder in his cables, denying him emergency aid to lessen his financial crisis (Mossadegh couldn’t sell any oil on the world markets, due to British Navy blockade), or any further diplomatic efforts to help resolve the stalemate.

Meanwhile, Alan Dulles charged a CIA operative, Kermit Roosevelt, the grandson of President Teddy Roosevelt, to conduct a complex, well-funded operation to bring down Mossadegh from within the US Embassy in Iran. The details of how Roosevelt pulled off the 1953 Iranian Coup, succeeding in a second try, four days after his first failure, after which he was advised to flee Iran, are a riveting story. See Joe Ayella’s documentary American Coup (2010, 52 min, Amazon Prime) for a great account.

After the coup, the nationalization was immediately reversed, APOC became British Petroleum, and the oil deals were renegotiated to give 50% of the profits, on paper at least, to the Iranians. William Engdahl’s Myths, Lies, and Oil Wars, 2012, describes how post-coup profits were redistributed among the non-Iranian interests: ““A quid pro quo for the CIA helping their British cousins, Washington extracted a heavy price on behalf of the Rockefeller oil group. What had been in the sole domain of British oil since 1908 now had to be shared with the American Rockefeller companies. British Petroleum, as the company was renamed after the coup, would henceforth get a mere 40% share of Iran’s oil.  Each of the five Rockefeller-linked US sisters got 8% or a total of 40%, and Shell got 14%, while the weaker French CFP got 6%.” Clearly, Western and US interests would never have gotten as good a deal without the coup. But was it worth it?

For one deep take, read veteran foreign correspondent Stephen Kinzer’s bestseller, All the Shah’s Men: An American Coup and the Roots of Middle East Terror, 2008. This book should convince you that it was a major mistake to bring down Mossadegh and re-install the weak, ineffective, and easily controllable Shah as a leader who would carry out American and plutocratic interests. Iran already had a very capable and popular leader that was a serious modernizer and friendly to American interests. He was willing to work with the plutocrats too, he just wanted a better deal and control of oil production, like the Saudis had. We could have let him have that control, if only we could have reigned in plutocratic and corporate interests.

We have been paying dearly for this mistake of foreign policy ever since, in both American lives and our influence in the Middle East, as we’ll briefly see next. The Shah quickly became a puppet of the CIA. With the Shah’s meek personality, he turned out to be ideal in that role. In the ensuing years, the CIA, together with Israel’s Mossad, worked with Iran’s military leaders to set up SAVAK, a brutal and much-hated internal intelligence agency, to maintain civilian control in Iran.

SAVAK, Iran’s Brutal Internal Intelligence Agency (1957-1979)

It may seem obvious in hindsight that the post-coup Iran was a social and political train wreck waiting to happen. Persia (Iran) is a traditionally conservative country, with a 3,000 year history of self-governance. In comes a government that is clearly serving Western plutocrats, using systematic repression to stay in power. To top it all off, in perhaps the greatest lack of strategic foresight, Western interests allowed the Shah to engage in deeply divisive, offensive, and breakneck speed oil-money fueled social modernization–ignoring centuries of Islamic norms and culture.

Iran Hostage Crisis, US Embassy 1979

This situation was ripe for conservative Islamic clerics in Iran to start demonizing America, Israel, and the multinationals, and to exploit the public’s increasing distaste for all the rapid modernization, the new sexual mores and objectification of women on TV and advertisements that were suddenly occurring everywhere. See my post God Fights Back: The Return of Religious Fundamentalism (2012) for more on that little-told story. See also my friend Raymond Matison’s two-part post on the history of Iran (2017), which independently reached the same conclusion that ousting Mossadegh may have been America’s biggest Middle East foreign policy mistake, among many in recent decades.

A government that was increasingly out of touch, was viewed as foreign-controlled, that ruled with escalating repression, and that was making rapid reforms offensive to its public would eventually be brought down in the Iranian Revolution of 1979, and the student-led Iran Hostage Crisis at the US Embassy in Tehran. The same thing happened in Cuba in the 1950s, when far too rapid growth of US-led gambling, prostitution, and other forms of commercial exploitation deeply offended Cuban conservative interests, and opened the door for the fundamentalist Castro to overthrow the government.

The Iranians of the 1970s called America the Great Satan. Looking at this history, can you really disagree with them? We took away their democracy, installed a puppet, and took no action to moderate his security arm’s escalating repression, or the corrupting influence of unrestrained capitalism on their culture. As a result, Iran became a fundamentalist basket case and sponsor of global terrorism for thirty years afterward. Our actions in Iran became the root of the story, told by radicals and fundamentalists in all Islamic countries, that America is hostile to their interests and culture.

In hindsight, are these prices that have been worth paying? Most definitely not.

Let us now propose a counterfactual. It’s 1953, and the Dulles brothers are working their strategy on President Eisenhower. He hears their shabby rationale for the coup, recognizes that Mossadegh is a pragmatist, a modernizer, and a potential ally against communism, and asks a question of John Foster Dulles:

Would Mossadegh accept a long-term US base in Iran, to protect them from potential Russian aggression, in return for emergency financial aid and the offer to act as an intermediary in renegotiating the oil deal?

Eisenhower could easily have pulled this off. Mossadegh greatly respected him and sought his help, as their cables make clear. Eisenhower was a General, and he was inclined to put Cold War politics and American interests first, and keep the financial interests of plutocrats in other countries, even allies like Britain, secondary. Negotiating for a base and a security agreement made perfect sense at that moment, as Mossadegh was in dire financial need. It would also have been a major Cold War win, no matter how rapidly it was established.

It is clarifying to remember that Iranians held us in high regard at the time. America stood for democracy, we had fought a war for independence from Britain for it, and we were natural allies. Mossadegh had broken some international laws with his nationalization of Iran’s oil, but they were also bad deals that needed renegotiation. If we’d continued to side with Mossadegh, the way Truman effectively did by staying neutral, and secured a US military base and security treaty in the bargain, we’d have achieved major Cold War aims.

We would have eventually asked Mossadegh to pay for that security of course, and we could also have advised him to do a non-exclusive renegotiation, so American oil companies could start growing in Iran as well. There was a lot of money to be made, and plenty to go around. The US had already helped out the Iranians with their security at the beginning of the Cold War. American pressure on Russia had led to Russia’s withdrawing from occupied northern Iranian territory in the Iran Crisis of 1946. Mossadegh was strongly Western oriented. He feared the communists and loved what our country stood for. He could have tried to sell oil to Russia over land during the British Naval blockade but he didn’t go that route, as he wanted a Western future. He simply wanted to develop better conditions for his people, as any populist and nationalist does.

If we’d supported Mossadegh, and continued to act as intermediaries between him and APOC, as we did under Truman, without pressuring either to come to immediate terms, a deal would have been reached. The British navy weren’t allowing Iran to ship out oil, and we would have continued to support the Brits in that policy, while supporting Mossadegh’s right to renegotiate his deals. Eventually, the pressure on each side to make money would have bought them to an agreement.

If we’d taken something like this course, we would have had a functioning, well-protected, modernized, moderate, and well-funded democratic ally in the oldest civilization in the Middle East, starting in 1953. A modern Iran would have driven modernization and moderation across the rest of the Middle East as well.

Mossadegh and his successors would have very likely listened to their people as they developed Iran, modernizing at a rate their most popular clerics would be comfortable with. Iran would have been a bastion of development, rather than the governance failure and breeding ground for anti-Americanism that it has been since the 1970s. The Iran-Iraq war of the 1980’s wouldn’t have happened, and the entire Middle East would be a very different place today.

Think this story is crazy? You should read what the Dulles Brothers did to Guatemala in 1954. We overthrew a ten-year democracy, at the request of the US conglomerate, the United Fruit Company, who was at war with Guatemala’s democratically elected president over agrarian reform. We installed a series of repressive dictators in service to US corporate interests for the remainder of the twentieth century. To pull this off, our CIA created a fake radio station, Radio Liberación, based in Florida, a fake rebel army, based in Nicaragua, and we wrote a playbook for using fake news. Ironically, that same playbook was used very effectively against us on social media by Russia in our 2016 Presidential elections.

What would Guatemala be like today if the US hadn’t ended their democracy in 1954? Costa Rica. Read the whole amazing tale here, several details of which have only recently been discovered: The (Literally) Unbelievable Story of the Original Fake News Network, Sylvia and Shane Snow, Narratively.com, 8.26.20.

I think we can say it again, foresight matters!

The Future of Intelligence and Special Ops

There is a quote often attributed on the internet to President Truman: “I never would have agreed to the formulation of the Central Intelligence Agency back in forty-seven, if I had known it would become the American Gestapo.” It isn’t clear if this quote is actual Truman or a paraphrase, but on several occasions he said similar things in his memoirs. In 1963 Truman wrote an op-ed where he argued the CIA’s role should be limited to intelligence gathering for the president, not be “a subverting influence in the affairs of other people”. He saw such “cloak and dagger” work a s a way to aid Communist narratives about US imperialism and warmongering.

On a surface level, Truman’s views on limiting the power of the CIA sound like good sense, as we know how quickly blowback can happen against our foreign interventions. But in reality, they were ideas for an earlier and simpler time in our history. There came a point for the US, soon after WW II, as the Cold War escalated, where intelligence and defense agencies that do clandestine foreign operations simply had to emerge. These security functions were developmental, not evolutionary choices. The world just got too dangerous, and other countries own “cloak and dagger” activities just got too advanced. Truman’s views would be supported today by naive libertarians like Ron Paul, but they are indefensible in the modern world, just as are libertarian’s views about unregulated capitalism. What we need today are better run and more accountable intelligence agencies, not weaker agencies. Likewise for all the special operations forces that these agencies and our Department of Defense also need and rely on daily, in service to national security.

Whether we like it or not, Americans, with our democratic history, unique role in the world wars, and great wealth and technical expertise, have taken on the primary responsibility for maintaining global security. We’re now entering an era of superempowered individuals and small groups, entities that are loyal to no state. It would be both impossible and naive to prevent the growth of intelligence and special ops in our modern world with its ever growing potential (yet so far, not actual) danger. Our intelligence agencies work deeply with those of most other countries today, in all kinds of special ops that are intended to make us safer, and usually do. A whole bunch more transparency is going to have to emerge, and a lot more special ops will be needed before we finally build a strong sociotechnical immune system on this planet, one sufficiently robust to cover all the current shortcomings in our current systems.

That doesn’t mean we can’t have more accountability for agency actions however. We could have more laws requiring the publicizing, with redaction, of each agency’s operations after some reasonable period of time, like 25 years, and even less redaction every 25 years after that. If what we do today doesn’t look good in the light of future generations, we can apologize and pay up for it in the course of time. Feedback and eventual transparency are always necessary to improve any complex system. Hopefully we’ll see more reforms moving in that direction in coming years.

We’ll always need to keep lots of national secrets, like how to build nuclear weapons, or superviruses, and the locations and nature of active intelligence and defense assets. But the public also has a right to know increasing amounts about our past actions, and more of those details can be safely revealed over time. A better version of eventual freedom of information processes with respect to our intelligence and defense actions would add stronger checks and balances on all our current systems. It would also make initiatives like Wikileaks, to create transparency without accountability, while endangering current operatives, look like the bad ideas they usually are.