Foreign Relations of the United States: Diplomatic Papers, 1944, The Near East, South Asia, and Africa, The Far East, Volume V

891.51A/12–144: Telegram

The Ambassador in Iran (Morris) to the Secretary of State

Tehran, December 1, 1944—4 p.m.
[Received December 2—10:10 p.m.]

890. I visited Prime Minister Bayat⁴² at his request yesterday evening and held a 2–hour conversation with him on the subject of Dr. Millspaugh. Entezam, Minister of Communications, was present at the conversation which was largely conducted between him and me as the Prime Minister’s French is defective.

Let me digress here to say that the British Ambassador told me he was consulted earlier the same day by the Prime Minister in regard to Dr. Millspaugh. Ambassador Bullard said he expressed the opinion that it would be unwise for the Cabinet to bring forward the Millspaugh question at the present time just after sympathetic reaction had apparently been shown by the United States press and public to the problems of Iran. He added that the matter was of course not his concern and that the Prime Minister would no doubt wish to talk to the American Ambassador.

Earlier the same day Dr. Millspaugh visited me and asked whether the Prime Minister had talked to me or sent me any communication concerning Dr. Millspaugh. I told him no and he said that he was quite sure the Prime Minister was going to take up with me the question of his employment. At this meeting I discussed with Dr. Millspaugh the Department’s telegram No. 679 of November 20⁴³ announcing the return of Gresham with the Department’s full support. As was to be expected, this news got a most unfavorable reception from Millspaugh. I am furnishing him the Department’s message in writing as he requested and he will reply.

Prime Minister Bayat asserted, as the Iranian officials always do in conversation with me, their desire to see the Financial Mission maintained and the regret that Dr. Millspaugh does not seem to be the man to carry it on as chief. He said that his Government desired to bring a solution to the Millspaugh matter and stop the endless controversy which continued in the press and in private. He asked whether he could count upon my support in arriving at a decision to terminate Dr. Millspaugh’s service and what the reaction of my Government would be. I told him what I have told previously to his predecessor Saed, to the Shah, to Court Minister Ala and other high officials; namely that the responsibility for action in regard to Dr. Millspaugh belongs to the Iranian Government which employs him: that I would neither take a position officially or personally in the matter. I said that if it were the decision of the Government to terminate the services of Dr. Millspaugh, that it was free to do so and that I would not oppose such action nor would I recommend it or participate in any understanding on the matter. I further said, as I have previously done to Premier Saed (Embassy’s telegram No. 753, October 11) that I felt confident the State Department would not feel irritation if it was the decision of the Iranian Government to dispense with the services of Dr. Millspaugh. I made a strong reserve however that any action on the part of the Government respecting Dr. Millspaugh should be undertaken in a dignified manner compatible with the status of Dr. Millspaugh as a distinguished citizen of the United States and with due respect to fairness of treatment to him in the terms of his discharge and with complete attention paid to Dr. Millspaugh’s personal feelings and comfort.

The Prime Minister asked whether the Embassy or its Government would encourage or look favorably upon other members of the mission resigning in solidarity with Dr. Millspaugh. I told him that we regarded the mission as an entity not dependent upon its chief as a body, but working under his direction only; that if the chief were removed for reasons desired by the Iranian Government, that we would not encourage in any fashion the voluntary separation of other members. I pointed out to him, however, that these American citizens were naturally free to take their own decision and no guarantee could be extended that one or more of them might not desire to depart together with Dr. Millspaugh and that neither the Embassy nor its Government had any means of control over the actions of these individual American citizens. He said he appreciated that and only wished to be told that the Embassy would not encourage them to act in such a fashion.

I then pointed out to the Prime Minister that I felt the mission itself had made substantial progress in its contribution to the improvement of Iranian finance and economy, particularly during the last few months and queried him as to whether a new chief would be able to accomplish more than Millspaugh. He said he felt himself that the mission, whose work he had followed closely, had improved in its functioning despite Millspaugh; that as he saw it the whole trouble lay in the personality of Millspaugh who continuously rubbed everybody the wrong way.

I pointed out to him the possible danger of losing the powers granted to the chief of the Financial Mission by the Majlis which were of a personal nature accorded to Millspaugh. He said he had foreseen that and that his thoughts ran as follows: He would endeavor to get Millspaugh to agree to taking a leave of absence in the US over a period of several months asking Millspaugh to delegate his powers to his two assistants Black and Pixley. Millspaugh apparently has the right to delegate his powers temporarily. Whether he will do so, in my opinion, is a horse of another color. He would put Black in charge of either finance or economics and Pixley in charge of the other branch as temporary chiefs. In the meanwhile he would seek from the Majlis agreement to allow empowering the Government to employ a chief of Financial Mission and authorizing the Government to confer upon this chief the powers, both financial and economic, possessed by Dr. Millspaugh personally at the present time. Thus the Government would be in a position to appoint an advisor without further reference to the Majlis which would have given its general authority to that effect.

He said at present time about 65 to 70 Deputies were opposed to Millspaugh and were demanding from the Prime Minister that he terminate Millspaugh’s services. He felt that if he did not act this block of Deputies would be strong enough to rescind law of Millspaugh’s engagement and would not grant appropriate powers to any new chief of Financial Mission. I told him at this juncture that while my Government did not wish to interfere in operation of mission, that it does feel mission should possess appropriate authority to make its functions effective and I did not personally believe my Government would be willing to recommend any eventual successor to Millspaugh whose position was of a figurehead without real authority. Prime Minister said he thoroughly understood and agreed it was useless to invite a foreign advisor in here in such important work without his possessing necessary authority.

He said if Black and Pixley proved capable in respective fields they might be asked to carry on permanently. If not he hoped American Government would assist him in finding successor to Millspaugh.

[Here follows personal observation by the Ambassador.]

I am not prepared to say whether Prime Minister’s idea of separating responsibilities in financial and economic fields is well based or not. I am inclined to think these duties overlap so closely they should better be under united control of one official; however, it seems to me that is primarily for the Prime Minister and his associates to decide.

The long conversation with the Prime Minister was carried out in a cordial spirit and at the en[d it was evident that Prime Minister and Entezam both understood that I did not intend to take sides or to participate directly with recommendations, suggestions or agreement of any nature in the Millspaugh controversy. I emphasized that I would go no further than making clear the attitude of the Embassy if the Government independently took a decision to terminate Millspaugh’s services. I feel confident that I acted in accordance with the Department’s viewpoint in this respect as explained in the penultimate paragraph of its telegram No. 604, October 5⁴⁴ in which the Department expresses the feeling that Dr. Millspaugh should be informed that if occasion should arise for requesting the Department’s support in connection with his employment the Department would not feel justified in lending this support.

In the conversation yesterday I did not consider it desirable to make any reference to the return of Mr. Gresham. First of all I want to see what Dr. Millspaugh’s reaction is going to be in that particular. Secondly the more I think it over the less it seems to me desirable to tell the Iranian officials that Mr. Gresham is returning here with the full support of the Department. When I arrived here I found that the Iranians from the Shah down were firmly of the belief that Dr. Millspaugh was an agent of the United States Government despite the outward appearances. I have had considerable difficulty in overcoming this belief and endeavoring thereby to remove the considerable resentment which the Iranians felt on this score. If I tell the Iranians that Gresham is coming here with the support of the State Department they will certainly interpret it as meaning he is a United States Government agent. That will immediately throw them into confusion as to what to do about the Financial Mission: Whether to appoint Gresham to please the United States or whether to follow out their plan of appointing Black and Pixley temporarily. Both the Majlis and the press will get a hold of it and some type of controversy will start even if Millspaugh is eliminated. I therefore think it highly desirable to let Gresham come back here and we will see after his arrival what seems to be the best thing to do. It may be that the Iranians will themselves take the initiative in appointing him to succeed Millspaugh if they feel that way about it as some of them have expressed the belief that he might be a proper successor. Personally I do not know. Therefore I think the matter of Gresham can safely ride for the moment except insofar as Millspaugh is concerned who already has knowledge of his prospective return.

While the Prime Minister seemed very confident of himself even in talking about Millspaugh he has yet to receive a vote of confidence from the Majlis for his general program and we must not forget that Millspaugh has Seyid Zia-ed-Din as a supporter together with certain others. In other words I am not at all certain that the Prime Minister will or can take definitive action with respect to Millspaugh. I will of course report further developments as they occur.

If the Department has any comments or suggestions to make in respect to this development I should be glad to hear from it at once.

Morris

42. Morteza Qoli Bayat became Prime Minister November 26, 1944.
43. Not printed; it conveyed a strong endorsement of the return to Iran of Harold Gresham, formerly of the Millspaugh Mission, and requested the Ambassador to inform the proper Iranian authorities and Dr. Millspaugh of this (891.51A/11–2044).
44. Not printed.