America and Iran a History


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Shite vs Sunni


by Shaul Bakhash

The U. S. has had relations with Iran ever since the last
quarter of the nineteenth century. American missionaries
have been in Iran even longer than that. But the United
States' real engagement with Iran dates only from WWII. The
relationship has generally been close, but it has been
punctuated first by the involvement of the CIA in the coup
of 1953 which overthrew a popular prime minister, Mohammed
Mossadegh, and then by the Islamic Revolution of 1979, which
led to a breach in relations that has not yet been repaired.
Indeed, two countries that were once close friends and
allies now see each other, respectively, as the "Great
Satan" and a member of an "Axis of Evil."

Looking at how some of the leading historians and analysts
of the U. S.-Iranian relationship have dealt with this issue,
it's interesting to note this constant sense of loss, of
what might have been. Barry Rubin entitled his work on the
relationship Paved with Good Intentions; James Bill
subtitled his Eagle and the Lion with "The Tragedy of
Iranian-American Relations." Gary Sick, a former member of
the National Security Council, subtitles his "America's
Tragic Encounter with Iran." A recent book by journalist
Barbara Slavin plays on this idea of a relationship that
might have been much better than it is, entitling her book
Bitter Friends, Bosom Enemies.

Between 1945-79, the U. S.-Iranian relationship was in some
ways similar to the U. S.-Saudi relationship, where the U. S.
dealt with one ruling family. In the case of Iran, the U. S.
dealt with one ruler, Mohammad Reza Shah Pahlavi, who came
to the throne in 1941 and continued to rule for almost four
decades. In this period, the relationship was governed by a
number of enduring and persistent features.

First, on the American side, the interest in Iran was due in
large part to the country's strategic location, bordering,
on the one side, the Persian Gulf and on the other, at least
until the collapse of the Soviet Union, sharing a very long
border with America's previous adversary. Iran was also
important because of its oil. During the Cold War, Iran was
both a potential target of Soviet expansionism, against
which it had to be protected, and a potential and often real
ally in the struggle against the Soviet Union. Finally, as
Iran grew wealthier from oil revenues, it became
increasingly a market for U. S. goods, arms, industrial
equipment, technology, investments, and, during the oil boom
years after 1973, the employment of American technicians,
advisers, specialists and the like.

On the Iranian side, first, the U. S. was seen as a potential
protector, initially against the dominance of the two great
powers that Iran had experienced throughout its 19th-century
and early 20th-century history - Russia and Britain; and
then against the Soviet Union. A second persistent feature
of the U. S.-Iranian relationship was Iran's view of the U. S.
not only as a patron and protector, but also as an ally in
advancing what one scholar has called the Shah's dreams of
grandeur; the idea that Iran could and should be a great
power, at least in the region.

Iran's 19th-early 20th century history with Britain and
Russia/the Soviet Union included wars with both these
powers. Iran lost territory to both, principally to Russia.
Both countries were deeply involved in Iran's economy and
trade, and both interfered extensively in Iran's internal
affairs and politics. Beginning in the 19th century, Iran
sought what I call a "third-country policy" - that is,
trying to find a country that could counterbalance these two
great powers. In the 19th century, it was sometimes Germany,
sometimes France. In the 20th century, particularly
beginning in WWII, Iran began to look to the U. S. But this
older history of wariness of great powers has played a role
in Iran's relations with the U. S. as well. A country that
was seen for the most part of the period after 1941 as an
ally, a great power in its own right, could also be seen as
a country playing once again the imperialist role. As we
have seen since the 1979 revolution, it is largely in this
role that Tehran has viewed the U. S in the last three

One can view the U. S.-Iranian relationship since WWII in
four phases. First, from 1941-53, Iran sought a protector
and friend; the Shah actively and determinedly sought to woo
the U. S., to attract it into a closer relationship. Second,
from 1953 to the late 1960s (post-overthrow of Mossadegh),
with the restoration of the Shah, who had fled the country,
to the throne, as the result of a coup engineered in large
part by the CIA and British intelligence, was a period in
which Iran was very dependent on the U. S. - on American
protection, support, and aid. This was not quite a patron-
client relationship, and Iran and the Shah's independence of
the U. S. grew. But nevertheless, it was clear that the U. S.
was the senior partner in the relationship. Third, in the
period 1973-79, the relationship became much more of a
partnership. The shah was much more stable at home,
wealthier, and more adept at handling his foreign relations.
He began to make demands. Fourth and finally, since 1979,
the two countries have been adversaries and have had no
direct political and diplomatic relations at all.

When WWII broke out, Iran declared neutrality. But the
Russians and British invaded Iran in August 1941 anyway.
They did so principally for two reasons. First, Iran had had
very close relations with Germany. The myth that the ruling
monarch of the time was pro-fascist/German has now been
addressed and dismissed. But there was a large German
presence in Iran, and the British feared for the security of
their oil wells in the south, and the Russians for their oil
wells in Baku, across the Iranian border.

Secondly, once Hitler invaded Russia in spring 1941, the
allies needed Iran's land route to supply the Russian army.
This would not have been impossible under a neutral Iran,
and therefore the Russians and British decided to invade
Iran. They got rid of the shah and placed his son on the
throne. This also brought American troops to Iran to
facilitate the supplies that moved from the Persian Gulf
across Iranian territory to the Soviet Union.

The Shah courted the U. S. assiduously in this period as
protection against the two great powers that had occupied
the country. On the whole, the U. S. was willing to be wooed
and seduced. Early on they gave Iran considerable support.
It was the U. S. that persuaded Russia and Britain to sign an
agreement to withdraw their troops from Iran within six
months of the end of hostilities in the war. The Russians'
behavior in Iran was moderated because of the U. S. presence.

When at the end of WWII the Russians insisted on keeping
their troops in Iran and supported a quasi-breakaway
autonomous movement in the Iranian province of Azerbaijan,
the U. S. was very helpful in pressuring the Russians to
withdraw and end this support. Already during the war, a
permanent feature of the U. S.-Iranian relationship had
begun. The Americans sent advisors to assist in building up
the Iranian army, police, and gendarmerie force and to
assist in other areas of Iranian administration such as

The shah, who was always ambitious to build up a large army,
already began in this period what became a perennial theme
in the relationship, which is to urge the Americans to
supply his army with more advanced armaments.

This honeymoon period in the U. S.-Iranian relationship faced
a crisis in 1951, during the movement to nationalize the
Iranian oil industry. Iran's oil industry was the most
important industry in the country. It was the principle
source of foreign exchange revenues. It was the largest
employer in the country. But it was British controlled.
Iranians had no say in the management of the company, or
production, or setting oil prices. For years, the British
government had derived from the Iranian oil operation far
more income than the Iranian government itself. In the late
1940s and then genuinely in 1951, there began a movement to
nationalize the oil industry. This movement was led by
Mossadegh, who became Prime Minister. The oil industry was
in fact nationalized in March 1951. Then there began a two-
year struggle between Iran and Britain over this act.

During the Truman administration, the U. S. government was
supportive of Iran. The US was suspicious of the old
imperial powers, and supported nationalist movements, which
it thought were a good barrier to the spread of communism.
There was genuine sympathy with the plight of the Iranians
and their desire for more control of their oil industry. The
Truman administration was often in the position of urging
the British to be more forthcoming in meeting Iranian

The British from the beginning were very unsympathetic to
nationalization and decided that Mossadegh was not a
reasonable man with whom they could deal. They sought to
have him removed from office. They tried to persuade the
U. S. to join them in a plot to overthrow him. Truman was not
willing to go along with this idea, but as soon as the
Eisenhower administration came in, it was very receptive.
Both President Eisenhower's secretary of state, John Foster
Dulles, and his brother Allen, the head of the CIA, were
Cold Warriors. JFD believed that neutrality in the Cold War
between the Soviet bloc and the U. S. was immoral. They
joined the British in a plot which, after some wavering and
uncertainty, did succeed in overthrowing Mossadegh in August

This was a seminal event in the modern history of Iran. The
involvement of the CIA and British intelligence in a coup
that overthrew a properly elected and very popular PM has
remained seared into the Iranian historical imagination and
has colored the relationship U. S.-Iranian relationship.

There were a number of other important repercussions of this
U. S. involvement in the overthrow of Mossadegh. The Shah,
who almost lost his throne over the affair, returned to Iran
in August 1953 determined that this should never happen to
him again. After 1953, there was increasing royal autocracy
and intolerance for criticism, dissent, independent
political parties, an independent press or an independent

Second, the shah's dependence on U. S. support was
intensified and entrenched. In fact, having brought the shah
back to power, the U. S. had a deep interest in seeing that
his regime was stable and that he remained on the throne.
Therefore, he was given not only moral and diplomatic
support, but financial and other forms of aid as well.

In the minds of the Iranian political class, the impact of
this U. S. involvement was two-fold. On the one hand, the
idea that America was different from the older imperial
powers persisted. The opposition, including Mossadegh's own
party, the National Front, continued to believe that just as
America had helped Iran against the imperialists in the
past, it would come back to its senses and help them again.

On the other hand, the U. S., which had been seen as
supportive of Iran's national interests, was now seen in
another light. Both these trends of thinking persisted among
the Iranian political class pretty much down to the time of
the 1979 revolution, although the close alliance of the shah
and the U. S. in these years, particularly in the late 1960s
and 70s, these years of growing royal autocracy, clearly
brought the Iranian belief in America's commitment to
democracy, to put it mildly, under great strain.

These were also years in which the shah, both in terms of
what he considered Iranian national interests and also
because of his reliance on U. S. support, when Iran's foreign
policy was very closely aligned with America's foreign
policy. As a result, tensions with the USSR increased, and
Iran was quick to join the Baghdad Pact, which saw Iran,
Turkey, Pakistan and Britain allied together in a defense
pact with the U. S. an informal partner.

This close U. S.-Iran alignment on foreign policy issues in
the 1950s and the early 1960s was occurring at a time when
elsewhere in the Middle East and Asia we saw the rise of
nationalists governments. In the Middle East in particular,
monarchies seemed to be falling like flies. Revolutionary
officer regimes were coming to power in Egypt, Iraq and
Syria. The great nations of Asia, India, China, and
Indonesia, were leading a non-aligned movement. Therefore
the shah, in terms of the broader trends in the Middle East
and the region, seemed isolated. All this did not go very
well with the younger generation in Iran, and broadly
speaking, with the educated middle classes. The shah was
pursuing a foreign policy, however sensible, one might
argue, that went against the grain of the dominant political
mood in the country.

The shah also developed, in this period, very close
relations with Israel - not because of the U. S., but because
of his own calculations of where Iran's interest lay. He saw
all around him Arab regimes that were radical, increasingly
allied to the Soviet Union, republics rather than
monarchies. It made sense then, that the enemy of your enemy
was your friend, and Iran's relations with Israel grew
increasingly in this period. Not among all, but among a
significant element in the population, it was unpopular.

The events surrounding what became known as the Status of
Forces bill (1964) - the U. S. just signed a similar
agreement with Iraq, SOFA - also proved controversial. These
SOFA agreements the U. S. has with many countries where it
stations troops are intended to protect American troops or
military advisors in other countries from the "terrible"
local courts. It in effect extends diplomatic immunity to
military personnel serving in a foreign country. In 1964,
the U. S. pressured a reluctant shah and a very reluctant
parliament and reluctant government cabinet to sign a SOFA
to cover American military personnel in Iran. The agreement
immediately aroused memories of so-called capitulations
which were very common in the region in the 19th century and
which also exempted European nationals from the jurisdiction
of native courts, Iranian courts in the case of Iran,
Ottoman courts in the case of the Ottoman empire, Egyptian
courts in the case of Egypt. In fact, Ayatollah Khomeini,
who 15 years later was to lead an Islamic revolution in
Iran, was expelled from the country for opposing very
publicly the status of forces bill, which he called an
agreement for the enslavement of Iran.

These were all ways in which the U. S.-Iranian relationship
soured in the 1960s-70s. But the fact that the press,
parliament, and political activity was controlled meant that
the pros and cons of this close relationship the shah had
reached with the U. S. were never openly discussed and public
opinion was never openly articulated.

At the same time, the shah was never really a client of the
U. S. In fact, he always chafed at having to do America's
will and sought to escape this tutelage as quickly as he
could. As his regime grew more stable, especially as Iran's
oil revenues increased, he tried to shake the U. S. off. He
did so increasingly successfully. The U. S. was preoccupied
with Vietnam, the Nixon doctrine which led to the twin-
pillars policy, the idea that regional powers allied with
the U. S. should take responsibility for regional security,
and that Iran and Saudi Arabia should shoulder more
responsibility for Persian Gulf security, meant the U. S.
relied more and more on the shah and more on him than on
Saudi Arabia, which lacked Iran's size, population, or
military clout. The Shah welcomed this, partly because it
enhanced his own role and importance, and partly because he
wanted to escape U. S. tutelage.

Then as oil prices exploded in 1973-74, Iran's oil revenues
quadrupled overnight. The shah became not a debtor to the
U. S. or the countries of Europe but a creditor. Iran not
only gained enormous economic clout, but also offered the
U. S. in a period of financial stringency and high oil prices
a huge market for arms, industrial equipment, technology,
and employment.

In this period the U. S. did make a number of serious errors
in Iran, in addition to doing a number of things correctly.
Aside from a brief period under President Kennedy's
administration, when Kennedy pressured the shah to begin
some reforms in Iran, particularly to break up the landed
estates and give a greater share in land ownership to the
peasantry, there was very little pressure in this entire
period on the shah in the political sphere. The U. S. was
pleased to see Iran stable and developing. It was developing
spectacularly. The U. S. was pleased to have a large market
for American goods. And as long as there was very little
internal unrest, it seemed that everything was under
control. The U. S. in this period, when it had weight and
influence in Iran, missed opportunities to guide the shah
politically, internally, in another direction.

Second, the U. S. was so pleased with the close alliance and
with the apparent stability of the shah's regime that it
began less and less to study closely the internal political
situation. We know now that a time was reached when at the
shah's insistence, the CIA agreed that it would not do its
own intelligence work in Iran, but would rely on the shah's
sources. When the boom in oil prices occurred and the shah
decided to use this huge revenue, less wisely than other
Gulf states, to try and catapult Iran into economic
advancement and industrialization, the result was huge
dislocations in the economy. Not only the U. S. but all the
European countries were complicit in an economic policy that
proved in the end very destabilizing to the shah's regime.
The attempt to inject into the economy a significant amount
of money in a very short period of time caused huge
dislocations, and explains in part the discontent that
helped fuel the 1979 Islamic revolution.

When that revolution took place, U.S. -Iranian diplomatic
relations were broken and have not been restored since. The
Islamic movement itself had from the beginning an anti-
American component. Khomeini's revolution was against the
shah, rooted primarily in internal problems. But it was also
against the shah's close relations with the U. S. This
stemmed from two very obvious factors. First, after all, the
Americans had supported the shah, and the opposition
therefore saw the U. S. as complicit in the shah's autocracy.
One also cannot forget that Khomeini was exiled from his own
country and spent 14 years initially in Iraq and then
briefly in France as a result of opposing the SOFA.

Second, Khomeini both in leading the revolution and then in
stabilizing it once the monarchy had been overthrown, played
very adeptly on anti-American sentiment. The themes of anti-
Americanism, of America as the shah's supporter, became
themes not only of the revolutionary campaign but of post-
revolutionary Iran as well.

Third, the seizure of the American embassy by student
radicals and the taking of American diplomats as hostages
had an enormous impact. Some 50 Americans remained hostages
in Iran for 444 days, from November 1979 until the
inauguration of President Reagan in 1981. This has left a
deep impact on the American political imagination and also
on the Iranian one. For the Americans, this was a searing
experience; for the Iranians, it was a moment of triumph.
The students who seized the embassy became overnight heroes.

Fourth, there was the U. S. position during the Iran-Iraq
war. When the war broke out, the U. S. formally at least
adopted a position of neutrality and did not supply arms to
either side. America hoped the two sides would wear out and
exhaust each other. But once Iran looked as if it might
actually win the war and bring Saddam down, the U. S. began
to support Saddam, not only diplomatically, but with
intelligence. The U. S. also remained virtually silent when
Saddam used chemical weapons against Iranian troops.

Finally, there has been the problem on the Iranian side of
the U. S. attempt to sanction, isolate and demonize Iran and
to view Iran as pursuing policies in Lebanon, on the Arab-
Israeli conflict, and elsewhere, hostile to American

It's not as if during these years there was no U. S. attempt
to reach out to the Iranians or vice versa. The first
president Bush, in his inaugural address, referring to U. S.
hostages held in Lebanon by Iranian protÇgÇs, used the
phrase "good will breeds good will." The Iranians did then
help secure the release of these remaining U. S. hostages,
but no good will came in reciprocation. Early in the Clinton
administration, the president of Iran offered a U. S.
company, Conoco, a large oil deal, but Clinton prevented the
deal from going through. President Clinton himself,
especially in his second term, attempted on a number of
occasions to reach out to the Iranians without success.

So there were attempts in these years to repair relations.
Why didn't they succeed? First, there was the legacy of the
hostilities of the past on both sides. Second, there are
concrete issues dividing the two countries. In any Iran-US
rapprochement, Iran would want to see an end to U. S.
sanctions against Iran, and an end to America's attempts to
isolate Iran and deny it technology, trade, and credits. The
U. S. would expect Iran to change its posture on Israel, to
stop attempting to be a spoiler in the Palestinian-Israeli
peace process, and to end its support for groups like
Hezbollah in Lebanon and Hamas in the Gaza strip hostile to
Israel. Also, for the U. S. there's the issue of Iran's
nuclear program.

In addition, some forms of Iranian foreign policy behavior
to which the U. S. particularly takes exception have become
very entrenched. Iran's hostility to Israel has become a
pillar of its foreign policy; its investment in Hezbollah in
Lebanon is a long-standing policy. Iran and the U. S. are now
competitors for influence in the Persian Gulf and the Middle
East. Iran may be a small and weak country compared to the
U. S., but it does have its visions of grandeur. It sees
itself as the great power of the Persian Gulf region. It
believes the U. S. must make space for it at the table in
deciding the future of Iraq or Afghanistan. One can see how
much at odds the Iranian position is from America's.

The events in Iran surrounding the June 23 elections will
make it much more difficult for President Obama, who has
tried to open a new page in U. S.-Iran relations, to allow
his senior officials to sit at the table with Iran. But even
had these events not taken place, U.S. -Iran relations would
remain fraught with difficulties and obstacles.
Of Related Interest

The †Future †of †Iran, †by †Kenneth †Pollack, †FPRI †Enotes,
September 2008

An Israeli View of the Iranian Nuclear Challenge, †by Efraim
Inbar, FPRI †Enotes, April 2008

The Making of the Modern Middle East, a 10-volume series for
middle and †high school students from Mason Crest Publishers
in cooperation with FPRI

Copyright † † Foreign † † †Policy † † Research † † Institute

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