422. 1. During [the] last two days I have received various hints, including one from [his] son, [Gholam Hossein] that Mosadeq was ready for me to call. Accordingly, I visited him yesterday evening. Our conversation, which lasted nearly two and half hours, was both exhausting and depressing. As I listened to him I could not but be discouraged at [the] thought that [this] person so lacking in stability and clearly dominated by emotions and prejudices should represent [the] only bulwark left between Iran and communism. As during several previous conversations, I had [the] feeling at times that I was talking with someone not quite sane and that therefore he should be humored rather than reasoned with. On occasions he resorted to such silly exaggerations and extravagances [that] it seemed almost useless to talk further. At one point I almost decided to abandon our conversation when he repeated again and again in monotone that “Iran would never, never want [the] UK and US to have any differences over it. Iran would prefer [to] go Communist than cause any trouble between [the] US and UK”. There were periods during our talk when he seemed lucid and sensible. [The] General impression which he left was however one of deterioration. I have noticed in [the] past that in [the] evenings he is likely to be more tired and to have less control over his emotions. I can only hope his behavior last evening was due to [the] strain of recent events and fatigue and does not indicate serious degeneration.

2. I shall not attempt to outline [our] conversation but will merely touch on those portions which seem to me to be more important and which may enable [the State] Department [to] have [a] better understanding [of] his present frame of mind.

3. He received me in [the] usual friendly manner. I began [the] substantive portion our conversation by saying that during recent days there had been circulated so many defamatory stories regarding US policies in Iran and [in] particular US relations with Qavam that it would be useless for me to try [to] deny all of them. [Ahmad Ghavam] I thought however it might be helpful if, in strictest confidence, I should describe to him briefly what [the] attitude [of the] US Government had been towards Qavam and let him understand [the] character [of] my personal relations with Qavam. I said I had seen Qavam twice before he became Prime Minister; once at dinner at [the] Turkish Embassy and on another occasion at dinner in [the] house [of a] mutual friend. During such talks as I had had with him he had not appealed to [the] US to support him either directly or indirectly. Although some [of] his friends had at times asked [the U.S.] Embassy [to] use its influence on his behalf I never had had any indication that Qavam was aware of these approaches to [the] Embassy. It seemed unnecessary for me to add that [the] Embassy, in pursuance [of] instructions from [the] US Government, had never directly or indirectly endeavored [to] support Qavam or [any] other Iranian as Prime Minister. Stories that Americans had by some sort [of] intrigue brought about [the] resignation [of] Mosadeq and [the] appointment [of] Qavam were so ridiculous that I failed [to] understand how intelligent Iranians, even in this emotional period, could [give] credit [to] them. These stories were being circulated either by people who had completely lost their ability to reason or by enemies of Iran who desired [to] undermine Iran’s independence by impairing relations between Iran and [the] US. I said [on the] day following [the] appointment [of] Qavam as Prime Minister [that] he had sent [a] message to me asking that [the] US give Iran financial aid to enable it to meet outstanding urgent indebtedness, including unpaid government wages and salaries. Qavam in this message asked me [to] see him on [the] following day, July 19. During [the] immediately ensuing conversation with Qavam he had told me that he hoped [to] achieve [an] oil settlement in [the] not distant future on [the] basis [of] which would result in [the] augmentation [of] Iran’s revenues and which would not in any way mean [the] sacrifice [of] Iran’s rights or sovereignty. Pending resumption [of] receipts from [the] oil industry Iran needed financial aid to tide it over [the] present financial crisis. I said I had told Qavam that I did not know whether [the] US had available funds which could be used for giving financial aid to Iran. If such funds [were] not available it would be extremely difficult to render aid for sometime as Congress [is] not in session. I had added that even if funds should be available [the] US in my opinion could render aid only in circumstances in which offense would not be given to public opinion of [the] US, UK and Iran. I had informed Qavam that he should understand that it would not be [in the] interest [of the] free world, including Iran, for differences between [the] UK and US arising from [the] extension [of] US financial aid [to] Iran to weaken [the] world security structure.

Weakening [of] this structure might encourage aggressive action on [the] part [of] international communism against countries which, like Iran, lay under its shadow. I had also told Qavam that [the] US could not undertake for [an] indefinite period to extend budgetary aid to any country and that such aid [of] this character as [the] US might be able [to] give Iran must be limited to several months until Iran could have [the] opportunity [to] set its house in order and balance its budget with [the] help [of] its own resources. Mosadeq asked if I had told Qavam that I would recommend US aid to him. I replied I had told Qavam that in view [of] his assurances that he would make every effort [to] effect [a] settlement in [the] dispute on [a] basis fair to both parties, and in view [of] Iran’s desperate financial situation, I was recommending that limited financial aid be given to Iran but that I had no idea what my government’s attitude regarding such aid would be.

4. Mosadeq thanked me for giving [the] above confidential information to him. He said he could draw several conclusions. [The] First conclusion was that [the] US had brought pressure on Qavam to bow to British demands and to permit [the] return [of] British rule to Iran. I replied [that] such [a] conclusion [was] entirely unjustified; [the] US had never suggested to anyone, including Qavam, that Iran take any step which would in the slightest degree weaken its independence or sovereignty. [The] US has always been of [the] opinion that Iran and Great Britain could come to [a] reasonable and fair solution [of the] oil problem without any sacrifice of Iran’s independence. Furthermore, I had not pressed Qavam to endeavor [to] come to [an] understanding with Great Britain regarding oil. I had merely informed him of [the] circumstances in which in my opinion [that the] US Government might be able to give financial aid to Iran. I had in [the] past, in informal conversations with Mosadeq, expressed myself to him similarly.

5. Mosadeq said [the] second conclusion which he had drawn was that although [the] US had shown [a] willingness [to] give aid to Qavam on [the] latter’s request, it had refused on several occasions to give aid to Mosadeq. [The] US therefore had showed [a] more friendly attitude to Qavam than it had [to] Mosadeq. I told [the] Prime Minister that [the] US Govt had not displayed more friendliness to Qavam than it would have shown to any other Prime Minister in similar circumstances. Without any instructions from Washington, on my own responsibility I had informed Qavam of what I thought [the] attitude of [my] government might be regarding [the] extension [of] financial aid to Iran if funds [were] available. I had also told Qavam that I was of [the] opinion from statements made by him that he was planning [to] take steps which might result in rendering [an] extension of US aid to Iran acceptable to public opinion [of the] US, Iran and UK. I was therefore recommending that if possible such aid be extended on [a] temporary basis. On various occasions I had made it clear to Mosadeq that I [was] personally prepared [to] recommend that [the] US Govt extend to Iran aid on financial basis, provided his government could follow policies which would make it possible for such aid to be given without offending public opinion [of the] US, UK and Iran. I was still prepared [to] make such recommendations to my government, provided I had reason [to] believe [that] Mosadeq intended [to] pursue policies [of] this character.

6. Mosadeq said [the] third conclusion he would draw from what I had told him was that [the] US had given encouragement to Qavam by showing friendliness to him. I replied that during [the] time I talked with Qavam he was Prime Minister. As Ambassador to Iran of [a] country friendly to Iran it was my duty [to] establish friendly relations with [the] Prime Minister who showed [the] desire to have such relations. If [the] performance [of] such [a] duty was [to] be considered as improperly encouraging to Qavam, then those opponents of Mosadeq who in [the] past had severely criticized me for maintaining friendly relations with Mosadeq, had some justification for their criticism. So long as I was Ambassador to Iran I intended [to] continue [to] maintain as friendly relations with [the] Iranian Government in power as may be desired by that government.

7. Mosadeq launched into [a] bitter attack upon US foreign policy. He said [that the] US had no diplomacy. [The] US in [the] Mid-East was merely [an] agent [of the] British. Manifestations of anti-Americans [anti-Americanism] as witnessed during recent days had shown how great had been [the] failure [of] so-called US diplomacy in Iran. [The] US had given [a] billion dollars [in] aid to Turkey and yet when Iran was bankrupt and on [the] verge [of] communism, it had refused financial assistance first because it feared that if Iran should be able [to] operate its own oil industry US oil interests in Saudi Arabia and elsewhere might suffer and, secondly, because it was afraid of British displeasure. I told Mosadeq that American interests in international oil were really of [a] secondary nature and did not govern our policies regarding Iran.

Mosadeq said [that] even certain Britons were charging that [the] US, because of [its] fear of [the] effect of US oil concessions in other countries, did not wish [the] British to compromise in [their] oil dispute with Iran. I again emphasized that [the] effects of [a] possible settlement on US oil concessions in various parts [of the] world did not play [a] major role in our policies regarding Iran. I added that in any event it did not seem likely that countries in which there were American oil concessions would be tempted follow Iran’s example. I had already on various occasions tried to make clear to him [that] it would not be in [the] interest [of the] free world for us to give Iran financial aid in circumstances which might cause British and American public opinion to believe that [the] US was subsidizing Iran’s position regarding [the] oil dispute. At this point Mosadeq began to chant that Iran would prefer to go Communist than for [the] US and UN [sic—UK] to have differences of opinion with regard to it. Eventually, I was able to tell him that [the] US choice was not merely between US–UK friction and Iran going Communist. I stressed that if serious misunderstandings should develop in [the] present world situation between [the] US and UK, Iran would go Communist anyway.

8. Mosadeq resumed his ridicule of American diplomacy. He said that [the] decision [of the] American judge in [the] Hague, which had given great impetus to anti-American feelings [in] Iran, was [a] good example. I said that [the] US did not consider that [the] American judge in [the] International Court was [a] diplomat or that any judgment he might render was of diplomatic character. I was aware it [was] quite useless to [try to] convince him that American judges were not influenced by [the] executive branch [of] government. I doubted that anyone not educated in America could understand [the] depth [of] American feeling regarding [the] independence of [the] judiciary. I had heard that Mosadeq himself was anxious [to] separate [the] Iranian judiciary from [the] executive branch [of] government. If he should succeed, Iranians might in years to come be able [to] believe [that] American judges did not receive instructions from [the] US Government. I said I would appreciate it if Mosadeq would tell me precisely what he thought American diplomacy should do in Iran. Mosadeq again reverted to [the] fact that [the] US had given Iran no financial aid in its time of need.

9. Mosadeq placed great stress on [the] Communist danger facing Iran. He said [that the] Iranian army was no longer [a] stabilizing factor. It was now hated by all Iranians. [The] Iranian army, under [the] orders [of] Qavam, who was [a] British agent, had fired on and killed hundreds [of] Iranians. Iranian people, therefore, considered [the] army as [a] tool [of the] British. I asked Mosadeq if he, as Minister of War, would not be able by certain measures [to] restore [the] prestige [of the] army. He insisted [it was] too late. Nothing could save [the] army now. In fact, [the] army was now [a] danger to [the] country since many officers and men, humiliated at their present unpopularity, might at any moment try to get back into public favor by taking leadership in [a] revolt of Communist character. This revolt might not be fomented gradually. It might break out at any moment.

10. I asked Mosadeq if there was anything he could tell me regarding future military aid and military missions. Various kinds [of] rumors were afloat regarding his attitude on these subjects. He replied he [was] not prepared to talk to me at present. He would take [the] matter up later. Any recommendations which might be circulated had no basis. He had not discussed his intention regarding military missions and aid with anyone. I said Gen. Zimmerman had always maintained friendly relations with [the] Minister of War. [Major General Wayne C. Zimmerman] Now that Mosadeq had [the] war portfolio I assumed it would be appropriate for Gen. Zimmerman to call on him. He said he would always be glad [to] receive Gen. Zimmerman “so long as [the] military mission was here”. It was not clear to me whether he intended that this phrase have special significance.

11. Reverting to [the] oil problem. Mosadeq described briefly [the] suggestion which he had made to Middleton. [British Charge de’Affaires George Middleton] He made no request of me and I stated that I was glad that direct conversation on [the] subject had been opened with [the] British.

12. As I was preparing [to] depart, Mosadeq said he hoped I would not take amiss [the] frankness [of] his comments to me. It had been his practice to talk on [a] personal basis rather than that of [a] Prime Minister addressing [an] Ambassador. He believed his country and government were in great danger and he could not understand why [the] US, which was supposed to be so friendly to Iran should not show friendship by action. I told Mosadeq that [the] US was in many ways trying to help Iran. He laughed and said if we were really trying [to] assist by [anything] other than words, we were certainly succeeding in hiding our helpful activities.

HENDERSON