Memorandum, State Department Summary of Telegrams

NLT/NAVAL AIDE) 304 OFFICE OF THE SECRETARY OF STATE DECLASSIFIED WASHINGTON E.O. 12065, Sec. 3-402 State Dept. Guidelines, March 6, 4-6-55 1982 December 28, 1951 By DEB NLT his TOP SECRET SECURITY INFORMATION SUMMARY OF TELEGRAMS HUNGARY In their discussion yesterday of the case of the American flyers held by the Hungarians our Charge in Budapest, Mr. Abbott, was told by Foreign Office Under Secretary Berei that our previous note and inquiries had been communicated to the competent Hungarian authorities and that no decision had as yet been made. Upon Abbott's reference to the press statement regarding release of the flyers made by the Hungarian Minister in Washington, Berei seemed astonished and finally said that the Hungarian Legation had not been authorized to make such a statement. With regard to Abbott's remark that he was ready to pay the money, Berei said this was not quite correct and that it would be necessary for the Minister of Finance to examine carefully the proposed method of payment. When asked if he could not give some indication as to when a decision could be expected Berei said he had no idea but would let Abbott know as soon as he had information from the competent authorities. Berei refused to answer questions regarding the place and manner of release, travel documents for the journey to Vienna, and the like. Abbott comments that many possibilities exist which may explain the continuing delay in re- lease of the flyers, such as awaiting instructions from Moscow or considera- tion of demanding payment in free US dollars. IRAN Ambassador Henderson reports that in a conversation with the Shah last weekend he found the Shah apparently frustrated, discouraged and fatalistically inclined. The Shah said that if events should so conspire as to make it impossible for the US to continue to extend financial, economic or military aid to Iran, he hoped some way could be found of explaining the matter to the Iranian public, so that the reaction would not be too violent. When Henderson suggested that they should not be thinking about what to do in case US aid should cease but rather about what to do to prevent it from terminating, the Shah replied that he did not know what he could do in face of the combination of US laws and Mosadeg's apparent determination to take no steps which would render Iran eligible for aid. The Shah said he had given some thought to replacement of Mosadeq by another Prime Minister but that he could not find a suitable person. Furthermore, since there was no organized effective opposition TOP SECRET SECURITY INFORMATION