Memorandum, State Department Summary of Telegrams

NLT (Naval Aidc) 223 OFFICE OF THE SECRETARY OF STATE the DECLASSIFIED WASHINGTON E.O. 12065, Sec. 3-402 State Dept. Guidelines, March 6, 1982 July 13, 1951 By DED NLT, Dale9-5-85 TOP SECRE T SUMMARY OF TELEGRAMS IRAN Embassy Tehran reports there are increasing indica- tions that the political position of the Mosadeq Govern- ment has been considerably weakened by developments of the past two weeks. Many deputies now realize that the oil impasse threatens Iran with serious financial difficulties, and they are critical of the government for not in- - forming the country of its plans for avoiding or mitigating the impending economic crisis. Moreover, the increasing confusion and inefficiency in the conduct of ordinary governmental affairs and the lack of confidence in the integrity of Fatemi, the parliamentary under-secretary, who is the active administrator of Mosadeq's office, has led to public criticism. The de- magogic tactics employed by Mosadeq's supporters to maintain nationalistic sentiment at a high pitch have alarmed many deputies; one deputy, a former member of the National Front, made a strong attack in a Majlis session, dubbing the Mosadeq Government the "ballyhoo cabinet" for its demagogy, and his attack was enthusiastically endorsed by some sections of the Tehran press, heretofore neutral. Mosadeq has announced that a group of will submit a report on his physical condition, and our Embassy comments that the purpose of this may possibly be to lay a basis for a graceful exit. SPAIN The Secretary called in the British and French Ambas- - sadors separately yesterday afternoon with regard to their recent representations to us concerning Spain. He said that following their representations he, General Marshall, General Bradley and Admiral Sherman had reviewed the problem with the President and, after carefully weighing all elements, the President had decided that we must proceed with our plans, and to this end a high Defense official will leave for a brief visit to Madrid within a few days. The Secretary referred to the fact that both the British and French representations had been based on political grounds, and he pointed out that we in turn faced serious political problems, which would be made more acute as a result of the current senatorial visit to Madrid. If we should draw back at this time, it would merely deflect political criticism to our British and French allies and would doubtless have a serious effect on the Foreign Aid Program. The Secretary indicated that we will confine TOP SECRET