Coll McCail

Coll McCail

Operation Ajax: When Britain & the US Toppled Democracy in Iran

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Seventy years ago, Britain and the US moved to stop the Iranian people from taking charge of their country. Today, we know more about the coup than ever. It is a window into the western powers’ secret war on democracy, writes Coll McCail.

“I owe my throne to God, my people, my army – and to you,” the Shah of Iran told Kermit Roosevelt after reasserting his grip as monarch in 1953. Kermit Roosevelt was Theodor’s grandson and the CIA agent tasked with the overthrow of Iran’s first democratically elected Prime Minister. “By ‘you’”, Roosevelt recalled in his memoir, “the Shah means me and the two countries – Great Britain and the United States – I was representing. We were all heroes.” Over four days, between the 15th and 19th of August 1953, these “heroes” conspired to crush the popular government of Mohammad Mossadegh.

The 1953 coup marked the first peacetime use of covert action by the US to overthrow a foreign government. However, having devised a template for regime change, the CIA waited less than 12 months before removing Jacobo Arbenz from power in Guatemala. Indeed, Washington considered Kermit Roosvelt’s work in the Iran good enough to offer him the chance to lead ‘Operation PBSuccess’ in the Central American nation. Threatened by Arbenz’s sovereigntist agenda, the United Fruit Company demanded intervention in Guatemala. In Iran, US operatives were acting to preserve the extractive monopoly of the Anglo-Iranian Oil Company (AIOC). The idea for intervention, however, came from London.

In 1908, William Knox D’arcy struck oil in Persia (now Iran). It was the first major discovery in the Middle East and British capital pounced on the region’s potential for oil production immediately by establishing the APOC (which became BP in 1951). For the next two decades, the APOC exclusively drilled Persia’s reserves and reaped profits — paying the Persian government only 16% of the tens of millions generated in revenue. In fact, APOC paid more to the British government in tax than it did to the Persians. By the early 1930s, Persia was the world’s 5th largest producer of oil, yielding some 6,000,000 tonnes in 1932 alone.

Persia was swept by famine between 1917 and 1919. More than 2 million people died. Despite its neutrality, Persia’s lands were occupied by the British, Russians, and Ottomans during the Great War as modern-day Iran became the main battleground of the Middle East. What little food remained had to be shared with the occupying forces, exacerbating the plight of the people. Controlling not only oil but customs revenue and, in some areas, tax collection, the invaders deprived Persia of the income which would have mitigated the impact of the famine.

The underdevelopment of Persia was a great success for the ruling class in London. The Chairman of APOC, Sir Charles Greenway, celebrated the fruits of Britain’s neocolonial plunder by comparing D’Arcy to Cecil Rhodes. The British businessmen certainly heeded Rhodes’ advice that “to avoid civil war, you must become an imperialist.” As Britain’s largest and most profitable overseas investment, there is little doubt that APOC’s revenue aided the British state in managing domestic discontent during the early part of the 20th century.

After the end of the Second World War, the Soviet Union sought an oil concession in Iran’s northern provinces. Profits and distribution would be shared equally. The British Minister of Fuel was blunt in his warning to the Foreign Office about the consequences of such an arrangement. “If Persia began to develop her own oil in the north, it might not be very long before she wanted to do this in the south also,” he wrote.

In 1948, the Iranian government invited the British to renegotiate their archaic oil settlement. Given the Soviet’s offer and the profit-sharing agreement recently reached between the US and Venezuela, the Iranians proposed a 50/50 split. Behind closed doors, British ministers considered it “absurd” that the Iranians should dare ask for such an “astronomical” share of their own resources. The proposal was refused and the British ambassador accused the Iranian government of being “greedy.”

In 1949, the National Front Party, led by Mohammad Mossadegh, was elected to the Majles – the Iranian Parliament – on a promise to nationalise the oil industry. With swelling public support for resource sovereignty and news of another US profit-sharing agreement, this time with Saudi Arabia, the British government capitulated. It was too late. On 15 March 1951, following Mossadegh’s proposal, the Majles called for nationalisation.

One week later, AIOC (now the Anglo Iranian Oil Company) workers walked out on strike in Southwest Iran. They were joined by thousands across the country and the world’s largest oil refinery at Abadan was temporarily shut down. Rallying behind the slogan ‘Down with Britain!’, the workers demanded that the benefits of nationalisation were enjoyed by the Iranian people. The strike ended one month later just days before the Majles unanimously approved the nationalisation decision and recommended Mossadegh for Prime Minister.

From the moment the nationlisation bill was signed into law and an Iranian national oil company established, the British worked to destabilise Mossadegh’s regime. The new Prime Minister had dealt a humiliating blow to the crumbling British empire by freeing Iran from the yoke of imperialism. London had to retaliate. Paratroopers were dispatched in the region and HMS Mauritius arrived in the Persian Gulf, not far from Abadan.

In September, the British announced plans to starve Iran back to the negotiating table with economic sanctions. “When the Iranians need money,” said the British Ambassador in Tehran, “they will come crawling to us on their bellies”. Iran’s London assets were frozen. US oil companies were easily persuaded not to buy from Mossadegh – the British ambassador had already reported to AIOC that they feared “probable repercussions [of nationalisation] in their areas.” Attempts to break this embargo were intercepted by the RAF.

In addition to the blockade, Anthony Eden sent the spy Robert Zaehner to sow discontent in Tehran in 1951. Norman Darbyshire, the head of Iran’s MI6 station, recalled that “vast sums of money were being spent” to topple the regime. Zaehner “used to carry biscuit tins with damn great notes. I think he spent well over a million and a half pounds,” he said.

Having failed to prevent nationalisation and fearing the prospect of post-colonial Iran, by July 1952 the British government realised that a coup was the only way to restrain Iran’s ambitions. Winston Churchill once said that control of Iranian oil “brought us a prize from fairyland beyond our brightest hopes.” Now his Government enlisted the help of the US to take it back.

Washington did not need much persuasion to join the British plotters. Since coming to power, Mossadegh had rejected the Truman administration’s overtures and now President Eisenhower feared Iran would follow the path of Communist China. In the summer of 1952, Churchill telegraphed President Truman to warn that “limitless supplies of oil would remove the greatest deterrent upon a major Russian aggression.” Mossadegh was no communist, however. He had opposed the Soviet’s attempts to gain an oil concession after WWII and struggled to build a united front with Tudeh, the Iranian Communist Party. Nonetheless, the fear of a nation that cast off its shackles and threatened foreign capital was reason enough for intervention. Indeed, British diplomats in Washington reported to the Foreign Office on the new president’s wish for “some quick success against communism.”

On 17th June, Secretary of State John Foster Dulles convened a meeting with Kermit Roosevelt to discuss ‘Operation Ajax’. With the intervention approved by Churchill, Mossadegh was overthrown two months later. Although a first coup attempt against Mossadegh, on 15 August 1953, was foiled by loyalist army officers, the US and UK intelligence services eventually managed to remove Iran’s Prime Minister at a second attempt less than a week later. CIA actors systematically seized control of Iranian institutions to undermine Mossadegh’s rule. The Iranian press was bribed to spread anti-government propaganda, the clergy was won over and the Shah’s support gained. Mossadegh was tried and placed under house arrest until his death in 1967. The leaders of the Tudeh were executed.

After August 1953, the management of the Iranian oil industry was handed back to a cabal of British and American capitalists. The Anglo-Iranian Company kept a 40% share and more than $500 million worth of compensation. For their part in the operation, the five US oil giants also received 40%. Ultimately, however, Washington gained far more than oil. The Shah took up his place as a puppet of US imperialism and Iran quickly became a bulwark of anti-communism. In 1957, the CIA oversaw the creation of Savak, the notorious Iranian secret police that tortured and surveilled the Shah’s political opponents on a mass scale, especially members of Communist parties.

“Out of the black cloud white rain has descended… His Majesty the Shah and Prime Minister Zahedi are producing sweet remedies… Zahedi’s advent to power is a repudiation of the sterile negative policies of the past,” said Henry Byroade, the US Assistant Secretary of State, having crushed the popular aspirations of the Iranian people.

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