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5/15/54. Reel 1, Track 2, Page 1 MR. ACHESON: At any rate, trouble began right away. The British began holding out on the negotiation of the new oil contract. They made a perfectly good and very satisfactory arrangement with the Iranians, but they got tangled up on small details so that Razmera was not able to take this thing before the Majlis pet at a time when he could get it accepted, and they dragged on this rather futile debate on minor points until his position was weakened and he felt he couldn't do it. Then we proceeded to get into trouble. had worked out a 25 million doller Ixport-Import Bank loan. Ragmara said that he didn't dare take that before the Mejlis in view of his difficulties with the British; it was too small and they wouldn't think it was adequate. They did's have any plans for the use of any further money, but Grady thought it was a wise idea to raise this loan to 100 million dollars. That seened to me very silly indeed, and I talked with the President about it and he thought it was silly, and I that believe we discussed it in the Cabinet and that vas the general view H if a vell, now man won't take 25 million dollars from you, you say, "All right;here¹ a 100.F You certainly will take that." That seemed to ne to be quite a foolish way to go about the thing. At eny rate, we didn't ão it; add that was, again, a source us of diseppointment to Grady. At this point, Razmara was murdered and Mossedegh cane in; and we cone to the second stage of this. Now at this point, George. I have gone over rather gaily ti] some rather serious questions which you had to vork around. Suppose we take a pause at this time, and you and Paul say anything you want to say on this part of it. MR. MC GHEE: I might just make some general observations, as you have, Dean, and then maybe we can converge on a point that ve can discuss back and forth. I came into the Iranian situation in 1949 and am not as familiar with that preceeding. I had a feeling always that Iran had a basic expectation of getting a hand-out, left over from the occupation during the war; that her whole basic psychology was that the western countries owed her something and that she was going to