Created: 8/25/1958

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' . si*ets ft* stability of lhe present regime in Iran.

SUV-VARY brutal overfiiiO'v of thein Iraq shockedrighter.ed the Shah of Iran and almost certainly caused bird to reappraise the future of his personal position and his program Ih Iran. There is basic and widespread dia-sat^faction wilh his regime, both inyn the urban populationIf he were to take dramatic and effective steps to reform the corruptpolitical, and economic sji'om. he inhjht be atle to maintain his position for some) time to tome. We believe,, lhat hlacharceler and situation orethat he is unlikely to take suchctions

s believe that the present political situationian is unlikely to last very' lon.j. The mos? prcbacl; developmentyivilliL'mdesiring liberal refoims, to force the Cliah back Into the role of amonarch. Tn lis initial stages al least,ovement would almostnot aim at the overthrow of the monarchy, nor would it teIn character. Although thiswould probably effect significantreforms, it Is doubtful whether il would be much more effective than the Shall in satisfying the expectations of the people for broader economic and social reforms Its leaders would probablyno oaslc changes 'n Iranianpolicy. It might cause the Shah to flee theven though it was not intended to have that effect

3 The possibilityoup to overthrow the monarchy cannot be disregarded On the whole, we thinkoup unlikely In lhe immediate future, because wethat tbe army does not now desire it. Dut if ir tbe reasonably near future there are no substantial reforms of the Iranian political, economic, and social structure, we think that the overthrow of theikely.

e rait twor iiis ii:cce*rted in ccnwiiriciinc all powor.its :vraonald toO-iy heeven the day-to-day lunctiens oit tlie same tims, his personal prestige ha-eclined.riticised forontinuance of near-feodji economic and social conditions in the country In spite ofelMntenlioneJ public pronouncements eoncerrunj social arid economic reforms, there is todayelief in the country that hisev-ill bring ;ueh rcfoims.

aJc of repiesentativehas been preserved it is regardedast majority of politically conscious Iraniansarce, flecttcns aren'iodi'd. dsrfc-av in the Matlis is limited, and

yiiand ctMivrihlp . capcniibili'y hew <ifCMirid over ihe past two years.

ti. At the same times roounled as the tctal wealthunlrv bast isithai the .lour.iry'save gone mutrjynrien tne ruling class. Actuallysir-able proportionthese revenues itas gone into the Plan Or-goiii-ation, but the results, although nothove fallen so far short of the Oit'imlS'.lC expectations of thee re' poli'ical imoact has been adverse. Wealth is concentratedhe handsmall group. Too growing expectations nf the urban masses formprovement In their standard ofwhich are not being met, constitute an source of discontent, flagrant conupiicn and nepotism continues through-ou: tlie government, and the predatory -co-nrraic activities of the royal familyhe Ci/urt circle evoke widespiead resentment ar.d


n thisajority of theU? ai-tiCJlote population of Iran has little fal*ii in Ce. Including some oiir-ervatlve militaryd nv*ftiixrs of tftis. feel thai the 3hah has been1nd has shv.7r. himseif incapijla of miring thek-ntly. Some feci that tlu Institution oi the monarchyv-ned andrsnt foimoveuiment is needed to makeynamic ans progressive country.

3 Although itlear lhat there is widespread disaffection, we have only limited knowledge of the organization, ship, and militaryof existing oppesttion groups. Former Prime Minister Mosiedeqymbol of naticnalut opposition, although he is not new polilkally active end is unhkeJy again toa position of real leadership. Several di.Tertnt natiooaUst groups are knownTt and to have been in LNsan from time to time. Wo do not knoar of any group of any political completion whichw capible ofuccessful coup. Yet it is entirely possible thatrcup crisis, especially in the military.

illegal Tudeh (Communist) Party,Arabrdish minorities willpotential sources of trouble forgovernment. Theakered since the fall ofactive. It couldoil opeiations In the Abadan arts ifsupported by radical ArabPan-Arab sentiments In th?areaevived KurdishIn tlie northwest couldto chaos tn Iran Ifontrol of the situation.

of fie .Viftfory. The stability ofgovernment depends, inthe loyalty of the array andrisis. We belfete that theresenior officers who would be wininga movement reducing th*fand many *ho would support suchif it gave promise oftrong man togovernment of Iran. As for thethe existence inervices oftyperuption and favoritism as

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o is fee tin- Siian too the rcij of xrisu.ulicnal monarch. We do nut believe that lac leadersovee monarchy.e.'inpl:sh snnii-u. political .vfoims. ihaughouot-whciher thay wcuia be muc. iw>kihan the Shah in satisfying th* rtpecla-tions ol th* people for broaderand social Kforju. Tie movement would not bo ulua-notionalist; lis alms wcu'd not be the same as those of Mossedeq. Is-wouldnot changegenerally pro-Wutcin alignment c! Iran, though its foreign policiestend to be more independent clInfluence than those of the Shah. We bellev* that any of the ?arlous military "coups" which have lately been rumored would piobaJly be of this nature. Theit. canric* be disregarded, bo*ever, that ainitially model ate In Its ,ipciiclci. might In lh* course ofmpelledore extreme courses, inciud. ir% en itttr.ipt to eliminate the Shah.

nother possible development, ulilcli we cunsKleehat ihe Shahv-iiil and

,Vit inn?d Ioim uiiw begm-iini* of: piiticipttlon Hi ;he government. If this xere to occur, there wouidair chance of orderly political evolution. But the cliai acler of the Shah Is such thaiculd beor him lo rellinulsn absolute

ihe goveirur.ent and to give po1ltic.ilie thinks of as enemies.

, he would have toiroujhvhich vould damage the specialot the royslhe Court, end thethe Sl-ah will btve-mtiy reluctant leuch actions and wcuiti te Jseiy to do so, if at all. only under heavy and continuing pi-ssure from the t'S.

he possibilityoup ta overthrow thehy cannot be dUregarcod. Oniole. w*oup ur.tliteiy In the Imucdial* future, bocsus* we believe that the amy dees not now dtslr* It But If in the reasonably near future there are noreforms of the Iianlan political, economic, and sociale tlilrJc that lh* over-thru* of tlw monarchy is likely.

K AMasslnation o( the Shah remains ar. ever present possibility. H* bas es'ablishfd no clear succession to the throne. If he should die. ae believe thererobablyhaotic struggle for power which Moulda period of unrest ond Iin the country until some group or Individual could establish doruinance.

ift Roic ofi<to?mtny The wtalih of Iran should grewxi fewil Mv^iues increase and other developmentowever, ue do not believe thai this growth *IM much Improve Hi* Shah's capabilities for rwtiainin* In poie-r. If current social condit.ons remanfl. And as lwg as thereenera! belle? that the benefits c* economicand ror-lgn aid are going principally to theiUsi, th*whlcb accrue to tbe majority of ths population will b* looked upon as less than their rightful due. In this situation US economiciopgap Ir. f. ptttod of financial crisiswould hove little effect upon the basic stability of the political situation.

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