Since 1979, British and American governments, when confronted with a political crisis within Iran, have invariably spoken of their desire to see more democracy in that country. To say these noises are hypocritical would be an understatement. The last time Iran experienced a multi-party, constitutional democracy was in 1953, when Britain and America planned, funded and implemented a military coup in the country, a coup whose sole aim was the protection of their oil interests. That democracy, however imperfect it may have been, has not returned since.
In 1908 oil was discovered in what was then Persia, one year after an agreement between Britain and Tsarist Russia to partition the country in to two spheres of control, the British holding the south and the Russians the north. The British were quick to appreciate the future use of the oil and organised a group of investors to form the Anglo-Persian Oil Company (APOC, renamed the AIOC in 1936). In 1914, to protect its interest in perpetuity, the British government purchased a 51% controlling share of the company.
In 1919, after a world war that had severely taxed Britain’s economic and military strength, the Anglo-Persian Agreement gave Britain control over Persia’s army, communications, transport and treasury. The British Foreign Secretary Lord Curzon insisted that if Britain was to assume “the mandate for Mesopotamia” it could not allow “a hotbed of misrule” to exist in this strategically vital area. In Curzon’s view the oil reserves of southwest Persia were “great assets” to be “worked for the British Navy”, and thus had to be controlled and protected.
No matter what political and dynastic changes occurred within Iran (as the country was renamed in 1935) over the next thirty years, Britain stuck to this goal.
For much of the period this meant accommodation to the rule of the man who started life as Reza Khan but ended it as Reza Shah. In 1921 Reza led a coup against the corrupt and enfeebled Qajar dynasty. With the British promising him military and financial resources, Reza quickly took Tehran, arrested the Shah’s Cabinet, and sent the Shah himself on a long European holiday. Reza then became Prime Minister. His original ambition was to follow the example of Turkey’s Kemal Ataturk and secularise his country, but after opposition from Iran’s powerful Imams these plans were swiftly dropped.
For a while Reza’s rule was uncertain, but the attempted return of the old Shah in 1926 united both the Imams and the Majlis, the Iranian parliament, behind him. In April 1926 they declared the formal end of the Qajar dynasty and the ascension of Reza as Shah. The Pahlavi dynasty thus began its stormy history.
Reza’s immediate clampdown on the press and trade unions, his jailing and killing of political opponents, did not disturb British policy makers, for whom the only consideration was his subservience to British oil interests, in particular the AIOC and the 1919 Anglo-Persian Agreement. The most radical alternative to Reza, the Iranian Communist Party (ICP), was outlawed in 1930 and most of its leaders imprisoned.
Reza’s fitful attempts to modernise Iranian society were not insignificant, especially in education, but they were driven forward by autocratic fiat and suffered badly from lack of a political base. As a sincere nationalist he made efforts to terminate the AIOC concession negotiated as part of the Anglo-Persian Agreement, and in the late 1920s he tried to re-negotiate the concession on better terms for Iran. The British were adamant that the concessions should remain unaltered. Frustrated at every turn, in November 1932 Reza declared that he was cancelling the concession.
Alarmed, the AIOC’s Chairman Sir John Cadman flew to Tehran to personally negotiate with the Shah. This produced the 1933 Anglo-Iranian Agreement, which in return for relatively minor concessions on the AIOC’s part – increased financial returns to Iran, and a promise that the appalling working conditions at the company’s notorious Abadan plant on the Shatt-al-Arab waterway would be improved – extended the concession for a further thirty-two years. The weakness of the Agreement led to discontent with Reza’s rule across all social classes.
Notwithstanding his unpopularity, with domestic opposition crushed Reza’s rule might have extended for decades if not for the outbreak of the Second World War. During the 1930s Reza had tilted towards open support for Hitler and Mussolini. When war was declared between Germany and Britain he announced Iranian neutrality. This allowed Nazi agents free rein within the country. After the German invasion of Soviet Russia in June 1941 the new allies (Britain and the USSR) feared that Germany might use Iran to launch a further attack on Soviet Russia from the south.
To prevent this possibility British and Soviet troops invaded Iran in August 1941 to secure the border and the country’s oil. The Iranian army, few of whom were willing to fight for Reza, quickly disintegrated. In September 1941 Reza was forced to abdicate and was replaced by his twenty-one-year-old son Mohammed Reza Pahlavi, a weak and pampered playboy whom the British believed they could easily control. Yet a much greater threat to the AIOC now emerged, in the form of the nationalist politician Mohammed Mossadegh.
Mossadegh came from Iran’s social and political elite. His grandfather had played a prominent part in the Constitutional Revolution of 1906, which had forced the old Shah to create an Iranian parliament, the Majlis, for the first time. Elected to the first Majlis in 1906 at the age of twenty-four, Mossadegh left the country in 1919 in protest against the Anglo-Persian Agreement. But Iranian politics were in his blood and he returned a year later to take up the post of the Shah’s Finance Minister, and later Foreign Minister. His granite integrity made him few political friends. The definitive work on his eventual downfall concluded “many rich and influential Iranians considered him a class traitor because of his insistence on judging them by the letter of the law” (Stephen Kinzer, All the Shah’s Men).
1943 saw the first relatively free elections in Iran. Mossadegh, having spent nearly twenty years in retreat at his country estate, stood for a seat in the Majlis. He returned to parliament as one of the most respected politicians in the country, known for long and principled opposition not only to Reza Shah but also to the AIOC.
The real spark of revolt against the AIOC was lit in 1946 when the workforce at Abadan went on strike. Over a quarter of century earlier, in 1919, what has been called “The first major strike of a colonised working class in the Middle East” (Frederic Clairmont, “BP: The Unfinished Crimes and Plunders of Anglo-American Imperialism”) led to the deaths of over thirty refinery workers when the army and AIOC police gunned down striking workers. This led to the formation of the Iranian Communist Party. Within a few years a national campaign led by the trade unions and the ICP for an eight-hour working day forced the government to concede the demand in the Labour Law of 1923. In 1925 trade unions led May Day celebrations across Iran.
This working-class spirit was suppressed by Reza Shah, but not destroyed. The 1946 strike demanded not only better working conditions but enforcement of the terms of the 1933 Agreement that had promised Abadan’s workers the same social infrastructure (e.g. schools, hospitals, roads, running water, etc.) that the AIOC’s British staff and their families enjoyed in their gated and well-guarded section of the city.
The newly elected British Labour government sent two warships to Abadan in support of the AIOC, but although their presence was significant they were ordered not to fire on the strikers. Instead the strike was put down by paid strike breakers from ethnic Arab tribes long at odds with the urbanised work force.
But the political climate in post-war Iran was far more sympathetic to the strikers than in 1919. Central to this was the resurrection of the Iranian Communists, now grouped together in a party known as the Tudeh (“Masses”). Although some of its older militants had been members of the ICP, the Tudeh was not simply a recreation of that party. It was initially “a united front for anti-fascist activities and constitutional rule” (Mazia Behrooz, Rebels With a Cause: The Failure of the Left in Iran) that emerged from the work of “The Fifty-Three”, a collection of left academics, writers and politicians imprisoned together under Reza Shah when war broke out.
By 1945 key positions within the Iranian trade unions were usually held by Tudeh militants. After the war the party moved on to the national scene. It even had three ministers in the 1946 coalition government, driving forward legislation that for the first time gave Iran a minimum wage and maternity leave. Had the Tudeh focused on these reforming initiatives, it might have become the major social democratic grouping in Iran and the bearer of the country’s post-war aspirations for national renewal.
But the pro-Soviet faction in the party saw Iranian developments through the prism of Soviet foreign policy, and following an ill-advised flirtation with revolutionary violence in Iran’s Azerbaijan province in late 1946, the party was once again banned, losing its foothold in government and increasing its isolation from the nationalists. Because of this the Tudeh underestimated the extent to which popular energies were now focused on the fight for control of the nation’s oil reserves.
Others moved to fill the gap. In 1949 Mossadegh and like-minded colleagues created the National Front, a reformist political party whose main aim was to establish a functioning democracy in Iran and gain control of Iranian oil resources by nationalising the AIOC’s operations in the country. Even the British Ambassador, unflinchingly supportive of the AIOC and dismissive of Iranian politicians, admitted that the National Front was “comparatively free from the taint of having amassed wealth and influence through the improper use of official positions”. The impetus for the formation of the National Front arose from a re-negotiation of the 1933 Agreement, which Majlis deputies had threatened to revoke.
Mossadegh led the Front in the 16th Majlis. But the AIOC’s creatures – the Shah and his new Prime Minister General Ali Razmara – ensured that Mossadegh was kept away from the executive. Razmara restored some of the Shah’s authority, not least by spreading huge amounts of bribe money around the Majlis to support the AIOC’s continued hold on Iranian oil. The cash was supplied by Ian Milne, the MI6 Head of Station in Tehran, who ran agents within the Majlis itself.
In February 1951 Mossadegh formally proposed the complete nationalisation of the AIOC. In March Razmara was assassinated. Without Razmara’s bribes the Majlis looked to other interests. Under great external pressure from an aroused populace, it voted to accept Mossadegh’s resolution and to nationalise the AIOC. After this the Shah had little option but to make Mossadegh Prime Minister in April 1951.
Mass support for Mossadegh was evident from the moment he took office. On 1st May a demonstration of 50,000 workers, peasants and members of the armed forces gathered outside the Majlis to support the nationalisation of the AIOC. Mossadegh sensed the national mood and reflected it.
Shortly after the decree was ratified, he declared:
We are nationalising the AIOC because it has systematically over several decades refused to engage in a constructive dialogue with us… Working hand in glove with the British government it has trampled on our national rights. Their conduct was one of unspeakable arrogance. Our battle for the end of the company’s domination has finally arrived and we shall triumph.
This was the beginning of an open confrontation between Iranian democratic nationalists and one of the last great remaining colonialist merchant ventures, the British equivalent of the American United Fruit Company in power, wealth, and ruthless determination to protect its profit margins. The previous year, 1950, the AIOC had made £170 million in profit from Iran, with only 12% going to the Iranian government. It had much to protect, and it was not shy in calling on its friends in the British government for assistance.
Although a hard-line anti-Communist, Britain’s Foreign Secretary Ernest Bevin was sympathetic to Iran’s desire to control its own oil resources. Unlike his more hysterical advisors he did not consider Mossadegh a Communist or a fellow traveller. However, Bevin’s health was failing and in early 1951 he was replaced by the dull political fixer Herbert Morrison. For Morrison, Iran was still “Persia”, an exotic oriental land which needed a firm guiding hand to ward off anarchy. He immediately created a “Persia Working Group” comprised of officials from MI6, the Treasury, the Foreign Office and the Bank of England, to address the problem.
The Persia Working Group drew up a plan for direct British military intervention, codenamed Operation Buccaneer, to secure the Abadan facility. But plans for invasion could not proceed once US President Harry Truman made it clear that the British did not have American support. Truman, sceptical of the ability of the newly formed Central Intelligence Agency (CIA) to make intelligent distinctions between Communism and radical nationalism, held Bevin’s view that Mossadegh was primarily a nationalist. It was clear to him, as the most revealing account of MI6 published to date concedes, that
despite British propaganda, the Mossadegh government was generally democratic, moderate, and seemed likely to succeed in establishing a middle-class hold over the state. (Stephen Dorril, MI6: Fifty Years of Special Operations).
Operation Buccaneer was shelved. For the Persia Working Group this meant that anti-Mossadegh operations had to go underground. This process was driven forward not just by Morrison and MI6 but by an alliance of right-wing “Orientalist” academics and FCO mandarins long accustomed to treating Iran like an imperial satrapy. Prominent amongst these were Professor Ann Lambton, Reader in Persian Studies at the School of Oriental and African Studies in London, previously Press Attaché at the Tehran Embassy during the war. Lambton and FCO Assistant Under-Secretary of State for Economic Affairs Eric Berthoud, who had worked for the AIOC for eight years before moving to Whitehall, agreed that the only way to remove the threat posed by Mossadegh was through “covert means”.
For years the MI6 station in Tehran had cultivated Iranians at all levels within the military and big business. The most useful of these “assets” were Shapoor Reporter, a British-Iranian businessman and close friend of the Shah who fed MI6 gossip from inside the Shah’s palace, and the infamous Rashidian brothers. The Rashidians were plugged into the highest levels of Iranian politics, business and the court. They were violently pro-British, sending their children to English public schools and keeping a permanent suite at the Grosvenor Hotel in London. MI6 paid them £10,000 a month. For this the Rashidians spread disinformation and smears about Mossadegh amongst the bazaar merchants of Tehran, whose leaders had the power to summon violent mobs on to the streets.
The Rashidians worked to the FCO’s Eastern Department and its Permanent Secretary Geoffrey Furlong. The Eastern Department now advanced the coup plan on several fronts – the academics of the Persia Working Group provided the BBC with news stories implying that Iranians were incapable of running the oil industry. The BBC worked closely with the AIOC’s information department, the Central Information Bureau, to disseminate their message within Iran and to suggest that those elements in Iranian society who had profited from the AIOC were about to lose their wealth and power. All strands of the anti-nationalisation operation ran through the AIOC’s Chief Executive in Tehran, Richard Seddon.
In July 1951 Iranian state security raided Seddon’s house and uncovered plans for the destabilisation of Mossadegh and lists of Iranians who were recipients of AIOC and MI6 bribe money. This led to all AIOC executives leaving the country in October 1951. Despite this, Mossadegh still sought a negotiated settlement with the British. But after the Conservatives came to power in October 1951, such a settlement became less and less likely. Faced with mounting evidence of the AIOC’s criminal conspiracy and of official British government collusion in plans for regime change, in October 1952 Mossadegh closed the British Embassy in Tehran.
An informal war against Iran was now declared. The new British Prime Minister, Winston Churchill, had overseen the creation of the AIOC in 1908 and had profited personally from his own shares in the company. His instincts were strongly imperialist. When the Labour government, in its dying days, failed to land British troops at Abadan to disperse striking workers, Churchill had been aghast. In November 1951 he wrote in disgust to the Foreign Secretary, Anthony Eden, that Labour had “scuttled and run from Abadan when a splutter of musketry would have ended the matter”.
Next time, Churchill would not hold back on the musketry.