Memorandum, State Department Summary of Telegrams

NLT(Naval Aidel 279 OFFICE OF THE SECRETARY OF STATE DECLASSIFIED WASHINGTON E.O. 12065, Sec. 3-402 State Dept. Guidelines, March 6, 1982 November 13, 1951 By DEB NLT, Date 9-5-85 E SUMMARY OF TELEGRAMS IRAN The Secretary reports from Paris that in the light of his discussions with the British on Iran he does not see any purpose in his attempting to get counter-proposals out of Eden before Mosadeq leaves the US for Tehran. Mr. Acheson analyzes the present attitude of the British Government as follows: Britain stands on the verge of bankruptcy and the re- - tention of her overseas interests and the invisible items in her balance of payments are of overwhelming importance to her. She can stand the loss of the AIOC properties and concessions, but she cannot recover from the course of action which would destroy the last vestige of confidence in British power and in the pound. They argue that if it should be believed abroad that Britain would acquiesce in the despoliation of Iran and even co- operate to make this profitable to the Iranians, she would have no properties left within a few months, and that the same thing would happen to all West- ern investments. For this reason it is Secretary Acheson's opinion that the cardinal purpose of British policy is not to prevent Iran from going Communist, but to preserve what they believe to be the last remaining bulwark of British solvency; that is, their overseas investment and prop- erty position. Therefore, they will accept no settlement: a) by which it cannot be shown plainly to everyone that Mosadeq has not profited over rulers who abide by their contracts; or b) by which Britain is humiliated and discriminated against. It is for this reason that it is impossible to induce the British to accept the exclusion of British companies and British citizens in favor of a Dutch operation, and that they attach so much importance to the suggestion that American interests should participate in some solution. The latter is based upon two points: 1) that American participation in any settlement would raise the prestige of the settlement and the participants; and 2) that introduction of an American company into the situation would prevent any action being taken except what our and the British oil companies would regard as in their interest. rOERET