THE OUTLOOK IN IRAN

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79T00937A000400020021-3
• Release Decision: RIPPUB
• Original Classification: T
• Document Page Count: 4
• Document Creation Date: December 19, 2016
• Document Release Date: February 8, 1999
• Sequence Number: 21
• Publication Date: September 23, 1955
• Content Type: MEMO

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CENTRAL INTELLIGENCE AGENCY
0"109 F NATIONAL ESTDIATES
23 September 1955
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STAY UM NO. 64-55 NO CH IN CLASS. M
SUfl z TO OVMM IN IRAN CLASS, CHANGED s 0 U
NEXT REVIEW DATE
RUTH: HR 70-2
WER
DATE: REVIE
1. The situation in Iran still conforms rather closely to the
analysis contained in NIB 34-54 (December 195k) and will probably
continue to do so for some time to cow. There has been the eexpecteed
revival of the political bickering, indecision, and general floundering
around which contributed so much to the decline of governmental
effectiveness and prestige in the pre-Mossadeg, era. Progress toward
getting the development program under way bed been sloeed by personal
and political feuding. The Bahai issue has marked the reemergence of
reactionary religious pressures and emotions as an unsettling influence
in the country. Ultranationalist and reformist sentiments remain alive
under the surface. Nevertheless, the situation, at least by Iranian
standards, continues to be remarkably calm. Although the Sbah's
prestige and effectiveness may have suffered to some extent from his
rather inefficient efforts to rule rather than reign, his ultimate
The substance of this memorandum here been discussed with Iranian
socialists in O/CI, DD/P, G??2, and G.'3.
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authority remains unquestiowd. The economic situation has been
gen.ly satisfactory, although some increase in the cost of living
has continued. Oil revenues, amomtlag to about $80 million in the
first eight months of operations, are running on schedule.
2. This state of affairs gives little ground for complacency
about Iran's future and in that reo phasixes the need for strong and
continuing Western pressures on Iranian leaders to make them pout their
house in order. Despite the surface calm, Iran remains a basically
unstable country in which underl7i0g tensions might flare up fairly
rapidly if propitious circumstances arose. And unless the ruling
group takes advantage of its present opportunities to lady the ground-
work for more lasting political, economic,. and social stability,
revolutionary pressures are likely to increase.
3. Nevertheless, we see little ground for alarm of the sort
expressed to US officials
in Tebran and Washington regarding the need for a strengthening of
the Iranian government. There is no immediate threat to the gooveern-
memth authority and none now appears to be in the offing. None of
the potentially disruptive forces in the country--Tadeh, the ultra-
nationalist element, the tribes, the mullahs--are now capable. - of pro-
voking a serious crisis. The dam' is rather that a continuation
of the present drift might Ave rise to opportunities which they
might exploit.
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k. Of greater lumediate importance than the internal stability
proble as such is that of Iran's relationship to the US and US-backed
regional defense plane. In BE 34-54 we ostiniated that the Shah,
despite his active interest in regional defense, would probably not
adhere to the "northern tier" Ong until be was confident that
such at moon would not encounter serious internal opposition and until
the Iranian armed forces had been substantially strengthened. During
the spring and summer of this year there were numerous signs that he
was acting to prepare Iranian public opinion for such a move, and
in the recent Iranian-suggested military talks at Baghdad between
Iran, Ira(, iur e~y, CU-M& aawravvw.
he gave strong proof that he regarded Iranian participation as
essential to effective defense of the area. BaJever, faced With
renew d Soviet counterpressures and with continuing US unwillingness
to give him either a formal security comitment or firm assurances
regarding support of an Iranian military build-vp, the Shah is now
backiM away from the idea of early adherence to the "n hern tier"
grouping. For a variety of military, political, and financial reasons,
the 'US has in effect gambled on securing Iran's adherence to the
"northern tier" grouping vithoutt a specific quid pro quo. That
gamble appears. increasingly to be a losing proposition.
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5. It is still possible that the Shah may decide to join the
"ncmtheern tler" grouping, p icularly sing efforts are now being
made as a result of recent 00 disaussiose to make available some
additjcnai Interim military aid pending an wWmrbM determination
some time next year of the extent to which it is desirable aM
faasable to tmdervrite a sigatfiaaat Iranian military build-up.
Howevier, the US has decided not to press for Iranian adherence to
the "northern tier" grouping at this time. Thus the move to increase
interim military aid appears to be mainly a holding operation,
designed to minimize the tateat dangers that the Shah's disappointment
over his failure to obtain prompt US support for his military plans
might lead to a permsnaat cooling off of the Shah's interest in
Western-backed defense alliances, to lessened Iranian responsiveness
to 1S advice, and to a decline in the Shah's morale and prestige
which night reduce his eeff'ectiveneess in maintaining internal stability.
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