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Iran: Public Image Versus Historical Reality Part 2. Iran: The Last Century to the Present

Politics / Iran Aug 04, 2017 - 02:17 PM GMT

By: Raymond_Matison


Iran: Part 2. Iran: The Last Century to the Present is a sequel to the first part of this report on Iran. The reading of both parts is necessary for a more complete understanding of how Iran has evolved to its present media perceived status in the world, and how reality diverges from popular perceptions. Part I, traces historical events which have shaped Iran’s evolution and development from its great Persian empire of over two thousand years ago to those taking place in the 20th century.

Democratic expression of people desiring end to foreign exploitation

The approval of a constitution giving power to a parliament and limiting the power of the monarch was revolutionary not only for Iran but for the whole Middle East.  Only Turkey had also tried to modernize its Islamic nation with education, modern script language reform, and establishing secular courts.  In mid-1930s Iran’s then monarch Reza Shah Pahlavi pursued some westernization but as this process raised opposition from clerics, it was the British who kept the Shah in power – who therefore had to accept continued British exploitation of Iran’s oil.

During the WWII years, the amount of oil extracted rose some thirty-fold, while the sales price of oil was ten to thirty times the cost of extraction, making Britain fabulous profits - as resistance to British exploitation of Iran’s most valuable commodity rose proportionately to widespread hatred of British imperialism.  Britain, having built the world’s largest oil refinery on Iran’s Abadan Island supplied as much as 90% of Europe’s petroleum needs, as Iran had become the world’s fourth largest oil exporter.

Originally, Iran was to receive 16% of the venture’s profits.  However, the British never allowed Iranians to examine its books, and eventually it was shown that the British were cheating Iran out of a substantial amount of Iran’s already paltry share.  Also, more recent profit sharing ventures in other countries had been agreed to by oil producers where profits were to be equally shared with a resource nation.  After WWII, Iran tried to renegotiate the fee arrangement, but the Anglo Iranian Oil Company was resolutely against any change.

During this time, a charismatic Iranian politician Mohammad Mossadegh had risen to power who championed constitutional government and sovereign integrity free from foreign influence.  He correctly saw that Iran’s own development as a country was suspended, as the lives of its citizens were sacrificed to those benefiting Britain.  In 1951 under his leadership as prime minister their parliament (Majlis) voted to nationalize Iranian oil, and the Shah signed a document revoking Anglo-Iranian concession and establishing a new National Iranian Oil Company.  This nationalization had many severe unintended consequences for the Iranian people. They could not anticipate the severe and determined effort of the British to stonewall and reverse Iran’s new policy.

No Iranians had been trained in running or maintaining the oil refining facility. The English, before removing their refinery employees, made certain covert adjustments to the oil processing plant, such that it would no longer work properly.  They actively discouraged any foreign oil specialists to work at the plant, removed tankers with which to transport oil, and imposed a Royal Navy blockade on Iranian imports and exports intercepting tankers carrying Iranian oil, and prevented Iran from realizing oil revenues.  Add to this the cost of maintenance of this intentionally orchestrated malfunctioning refinery, the diminishing amount of end product to be sold, the freezing of all Iranian bank accounts in British banks, and suddenly Iran’s greatest natural asset became a huge financial liability severely affecting Iran’s overall economy.  Britain even brought this dispute to the World Court, but to their credit the court did not support Britain’s claim.

Of course, Britain’s resolute opposition to Iran’s sovereignty is understandable in that if Britain could not control or profit from Iran’s oil, its own government deficits would explode and Britain would quickly lose its global power.  In completing its effective, shameless plan Britain warned other nations that it would take action against any country buying oil from Iran.  This comprehensive plan reduced Iran’s de jure constitutionally democratic government to de facto servitude.

Mossadegh, reflecting on Iran’s shared historical experience with the United States, that of having also suffered under the colonial servitude of British rule – which required the revolutionary war of 1776 for the U.S. to become free - had high hopes of getting support and a loan from America.  Mr. Axworthy in his book “The History of Iran” notes that in 1950 America sent its ambassador Mr. Henry Grady to Iran who saw “an impoverished land long exploited by the British, who sucked the country’s lifeblood and treated the pitiful Shah like a servant”.  President Truman sympathized with Iran’s nationalist movement and had contempt for British imperialism.  However, he was at the end of his presidential term, and the newly elected president Eisenhower held somewhat different views and valued different country alliances.  In the end Iran did not get a loan from the United States, but instead the U.S. joined the boycott on Iran’s oil adding to its economic despair and isolation – a country that was quickly racing towards forced bankruptcy.

 Mossadegh broke all diplomatic relations with Britain; in response to which Britain was planning the subversion of Mossadegh’s government, actively lobbied the United States to participate in a political coup, and made plans to militarily occupy Iran.  Playing on the concern that America had about growth of communist influence in Iran and their potential control of a substantial portion of world oil supply, Britain skillfully maneuvered America’s politicians to lead an overthrow of the democratic Mossadegh government.

Installing the Shah

When Mossadegh learned of Britain’s agents conspiring to depose him, the Prime Minister ordered Britain’s embassy to be closed, forcing clandestine agents working within the embassy to leave the country.  Both Prime Minister Winston Churchill and President Dwight Eisenhower had ordered a coup of Prime Minister Mossadegh, but only the U.S. and its CIA remained in a good position to carry out this mission.  Kermit Roosevelt, grandson of President Theodore Roosevelt, an experienced CIA agent with former assignments in the Middle East was given responsibility to carry out the deed.  The code name of this operation was known as Operation Ajax, and Mr. Roosevelt’s cover name was James Lockridge.  The State Department officially has acknowledged U.S. complicity in deposing Prime Minister Mossadegh - an activity which would be forever damned and vilified, perhaps involving militarily retribution if some foreign power were to attempt this against England or America.

Mr. Roosevelt paid off existing operatives, sympathetic military officers, Islamic, political, news media, and other persons of influence to generate a continuing flow of negative press articles, and organized street protests against Prime Minister Mossadegh – painting him as soft on communism, all in order to weaken his public persona and popularity.  He also succeeded in the difficult assignment of convincing monarch Mahammad Reza Shah to sign a decree which would demand the arrest of Mr. Mossadegh, naming an alternate individual (General Zahedi) friendly to British and the U.S. oil interests, a staunch anti-communist, one who would reduce the influence of parliament, while elevating the power of the Shah.  The initial coup attempt failed due to uncontrollable weather circumstances, but Mr. Roosevelt’s perseverance with hundreds of paid public agitators triumphed several days later.  Mr. Mossadegh was imprisoned for three years and committed to house arrest thereafter until his death in 1967.  Many other members of his political party and loyal military people were shot or arrested.  The budding democracy was crushed, and the oil plunder continued.

The CIA had toppled Middle East’s only democracy, installing a monarch who became unpopular, which required increasingly repressive policies in order to stay in power.
Had it not been for the CIA’s project Ajax, a coup of Iran’s democratically elected Mossadegh would likely not have occurred at all, and the country’s future as well as that of the Middle East and the world as a whole would have been completely different.  Their nascent democracy had grown unevenly over the last half- century, but would likely have developed and evolved further towards a well-functioning mature secular Muslim democracy in the next half-century.  Instead, the subversion and coup brought forth in a short twenty five years the complete antithesis of what the United States had desired – an uncompromising Islamic revolutionary take-over which established policies contrary to American interests, promoted terrorism and suppressed the development of a more secular Iranian society.

This coup’s initial success unfortunately prompted the U.S. to repeat the formula for deposing leaders that they did not approve of in other countries - which later also brought undesirable consequences.  In his book “All the Shah’s Men” author Stephen Kinzer notes that

“Later the CIA set out to kill or depose foreign leaders from Cuba and Chile to the Congo and Vietnam.  Each of these operations had profound effects that reverberate to this day.  Some produced immense misery and suffering and turned whole regions of the world bitterly against the United States.” 

From that wider, longer-term perspective we can see that while in the short term Britain and the United States immensely benefited financially from the coup, but also that the world today is paying a staggering price for having extinguished a democracy in the Middle East.

Theocratic Revolution

Resistance to the persisting plunder of Iran’s oil by outside powers meant that the level of hate continued to grow for Britain and was rising against America.  Over time clerics became more powerful such that they could incite and sustain a religious revolution.  The Shah’s increasingly brutal reliance on repression and torture to maintain control of his subjects by the feared SAVAK security police ranked Iran as being one of the worst human rights violators by Amnesty International.  People were demonstrating in the streets against a tyrannical Shah, and by the late 1970s secular constitutionalists and supporters of Mossadegh’s nationalist policies, Muslim fundamentalists and communists both dismissive of monarchy coalesced as a group to overthrow the Shah.  Over one million people were said to have demonstrated in the streets of Tehran, Iran’s capital, and as Muslim clerics spearheaded an Islamic Revolution the Shah was deposed and had to flee Iran in 1979.  Ayatollah Khomeini became Iran’s new Islamic leader.

The Shah had been diagnosed with cancer, and was looking to the United States as the best place for medical intervention.  When President Carter allowed the Shah to enter the United States for treatment, Iranians feared that another attempt would be made to re-install him back as Iran’s monarch.  This was the proximate cause of Iranians seizing the U.S. embassy in Tehran, whereby embassy members were held prisoner for 444 days.  President Carter, near the end of his first presidential term was negotiating with Iran for the release of the prisoners, in order to improve his chances of reelection.  However, unknown to him, presidential contender Reagan had used back channels to offer Iran more benefits if Iran would hold prisoners until Reagan’s election.  President Carter’s inability to release the prisoners caused him to lose the election, and all of the prisoners were released on the day of Reagan’s inauguration.
After WWII, the United States became the undisputed world leader it seemed appropriate that it also needed to control the flow of oil from the Middle East.  Iraq was one of the largest oil producers, and its president Saddam Hussein, had been recruited and trained as a twenty year old CIA asset in 1959.  Hussein was encouraged to attack Iran - which started an eight year war in 1980.  The subsequent bombing reduced oil production of both countries, and generated upward pressure on oil prices. However, what neither Iran nor Iraq knew initially was that according to author of “Myths Lies and Oil Wars” F. William Engdahl,

“Washington had covertly facilitated the arming of Iran. Washington policy was to arm both sides to the hilt and to make certain the war bled both countries over a period of years, while making sure neither side won a decisive advantage or victory.” 

Iran had about one million casualties from the eight year war. When Iran ultimately understood Washington’s duplicitous plan, it did not endear, but further alienated the United States to Iran’s citizenry.  Also, the covert arming of Iran created a huge political crisis in the U.S. called the Iran-Contra scandal.  Government officials arranged for weapons to be sold to Iran while it was under a Congressional arms embargo, as the proceeds of the sale were to fund Contras in Nicaragua to depose the elected government of Nicaragua, which also had been prohibited by Congress.  One might ask, if these government officials can ignore Congressional laws, then who really does run the country, and is it really a democratic republic?

Recent developments

When Iran was sanctioned from selling its oil or trading in dollars, it engineered a $20 billion transaction with Russia in 2014, whereby it would sell this oil on a barter basis for needed products.  Such a move allowed Iran to circumvent these specific U.S. petrodollar sanctions.  To escape sanctions in another instance, Iran used gold as a basis for selling oil to India.  It is important also to understand what precisely the innocuous sounding word “sanctions” really means.  Sanctions are an effective form of war which does not use bullets or explosives, nor does it create visible destruction - but it is a brutal form of war whereby every citizen of a target country becomes injured.  Under such U.S. sanctions Iranian’s major source of revenue, oil, was reduced by more than 50%, and being unable to access its foreign reserve holdings in international banks, its economy was quickly broken.

For years the Iranian economy has suffered greatly because of U.S. imposed sanctions. The Obama administration had been negotiating with Iran to stop nuclear research and development in exchange for the lifting of certain sanctions.  A partial lifting of sanctions allowed its banks to reconnect to the global financial system and helped revitalize the Iranian economy.  The ultimate deal appeared unsatisfactory to many American neo-conservatives as it unfroze over $120 billion in seized Iranian bank funds yet did not strictly prevent Iran from developing nuclear weapons.  Very conveniently, after these funds were released, Iran purchased from the United States a fleet of commercial airlines from Boeing for $80 billion. Coincidence? One could argue that if Iran is as evil as it is made out in our media, we likely should not trade with them at all.
China also has become a significant purchaser of Iranian oil.  To underscore the seriousness of its commitment to this major source of oil, China conducted a joint naval exercise with Iran in the Persian Gulf.  Then, by announcing its support for improved military ties with Syria, China is showing its general support of Iran-Syria-Russia geopolitics in opposition to that of the United States.  Iran, to show its commitment to this alliance, launched a number of missile strikes against terrorist bases in Syria.

Events have been cited which appear to support the argument that Iran is seeking to purchase missile and nuclear technology wherever it can find it.  That really should not be surprising.  Iran, as other countries which have been exploited by imperialist nations for decades, recognize that the only way not to be pushed around is by becoming a nuclear power – which provides the ultimate deterrent to a smaller and weaker nation against usurpation by a larger and stronger one.  However, Iran has also been developing its own missile and nuclear technology, which arguably is the only Middle East nation with such capability – which speaks volumes about the country’s educational system relative to the rest.

Unfortunately, a weaker nation dominated for long periods of time by a stronger imperialist country cannot easily end its oppression.  As all official government institutions are controlled by the colonialist, no large scale official response is possible.  Therefore, small unofficial groups utilize terrorism to bring attention to its plight.  Wise articles in the press, lawsuits, and quiet protests get no acknowledgment – it takes terrorism, despite its heinous results, that gets public attention. So it is arguable that terrorism is a desperate response of oppressed people who have no other means to bring attention to their plight.  

Iran for its part, denies sponsoring terrorism and in turn points to the extremist Sunni sect of Wahabism residing in Saudi Arabia as its real source.  In addition, tiny Qatar in trying to suppress Syria’s quest for sovereignty has been an outsized sponsor.  Qatar, lately recognizes that Russia will unconditionally support Syria and will not allow Syria’s government to be replaced with a U.S. chosen puppet - which would jeopardize Russia’s Gazprom gas pipeline monopoly supplying natural gas to Europe. Accordingly, Qatar may shift its allegiance and reach an agreement with Russia which allows Qatar to send its natural gas through Iran.  This would dramatically reduce the sponsoring of terrorism.  Iran also blames America for sponsoring and practicing terrorism.  Given that President Trump just announced a $100 billion military hardware deal with Saudi Arabia, a recognized supporter of terrorism, one may reasonable ask – is there any truth in this?

One segment of Iran’s population has long been secular, and holds views that strict Islamic law has impeded the overall development of the country and its people.  Accordingly, they would prefer a democratic republic to replace the Islamic regime.  However, Islamic leaders have established laws which explicitly forbid such a transition.  These secular Iranians had hoped that removal of monarch Shah Pahlavi would lead to better, more enlightened governance, but this has been a huge disappointment to a large part of the population as monarchial tyranny has only been replaced by religious fascism.  And Iranians are fully aware that it was the United States, which by installing Shah Pahlavi to replace Prime Minister Mossadegh, was responsible for creating the current oppressive theocracy under which all Iranians are forced to live.  The secular civil-minded reformers recognize that Iranians have long been prisoners alternating between foreign invasion and domestic despotism for well over a century. Unfortunately, substantive change in governance may be now decades away, and could require another bloody revolution to accomplish.

Iran has increased its political visibility and regional influence during a period of time when the United States had expanded its influence, presence and military might in the Middle East.  In fact, it appears that America’s invasion of Iraq has acted as a catalyst to align and unify China’s, Russia’s, and Iran’s regional policies probably to the great consternation of the United States State Department.  In addition, the new Iraq government is dominated by Shiite Muslims, and with Iran having a military presence in Iraq, it is entirely possible that Iraq eventually will join Iran in creating a core of counter Saudi Arabia Sunni influence. Should Qatar pivot to Iran or Russia to better secure its natural gas operations, and China influence Saudi Arabia to sell its oil to China for renmimbi rather than dollars, the world will experience a tectonic shift of power to the East.

What would you do as the supreme leader of Iran?

Let us imagine that you, dear reader, had grown up in Iran, were intensely schooled in its history, sharply aware of Iran’s plight over the last century whereby outside powers inserted themselves in your country and took control from your leaders, plundered the country’s vast oil resources, suppressed the schooling and training of its citizens and its economic development, lived under the long-term British tyranny, read about the invasion of your country during the second world war, your parents witnessed the CIA’s deposing of your democratically elected Prime Minister, and you personally experienced the restrictive living conditions under theocratic extremism, and were exposed to living under U.S. imposed sanctions which has drastically reduced your quality of life. 

Now let us assume that you also are aware that nations which have nuclear weapons do not get pushed around or get exploited.  Suddenly you have been elevated to the position as the Supreme Leader of Iran and head of the Islamic Revolution.  What would you do with regard to the development of a nuclear weapon and an effective delivery system – despite what any critics say?  Would you acquiesce to such demands, or would you follow the counsel implied by your century old harsh experience. 

If that previous question seems too easy to answer, then consider that Iran’s secular populace has recovered its democracy such that Islamic fundamentalism has been evolved to a more tolerant modern form which is now acceptable to most of its citizens.  You have been elected to serve as Prime Minister of democratic Iran.  What would you do with regard to developing a nuclear weapon and ballistic missiles?  Is it really true that you are a terrorist nation which cannot be trusted with a nuclear weapon?  Or is it true that you need a nuclear weapon just to have de facto sovereignty?  These are no longer easy questions to answer, and each individual is likely to have a different viewpoint. However, these are the questions which need to be honestly addressed in order to reduce the intentionally generated Mid-East chaos, war, and clandestine operations.

You also now have the personal experience that your region’s neighboring countries have joined a regional protective association called the Shanghai Cooperation Organization (SCO), similar to that of Europe’s NATO.  You know that China is developing its One Belt One Road economic policy which is building global infrastructure that will facilitate trade among three fourths of the world’s populace.  You are aware that China has formed the Asian Infrastructure Investment Bank which will provide credits whereby constructive loans promoting development is available to your country.  You have experienced a century of oppression by arguably the most advanced, democratic and civilized nations on earth - what would you choose for your country’s future: more of the same past experience or risk the new alliance?

Iran has been a centuries old victim of Muslim Arab invasion, a twentieth century victim of English colonialism, and most recently of American oil imperialism-globalism. Iran has experienced a terrible fate over centuries.  Hopefully, Iran’s people will achieve their aspirations with a maturity such that it will forgive these other countries for its past transgressions – but not forget.  Greatness of a country is best defined by what a country and its people become, rather than what any country may conquer.

Raymond Matison

Mr. Matison is a U.S. patriot who immigrated to this country in 1949. With a B.S. in engineering physics, an M.S. in Actuarial Science, work in the actuarial field, and as a financial analyst at Legg, Mason Inc., Lehman Brothers, and investment banking at Kidder Peabody, and Merrill Lynch provides a diverse background for experience.  First-hand exposure to fascism, socialism, and communism as well as the completion of a U.S. Army military intelligence course in the 1960’s have inspired a continuing interest in selected topics in science, military, and economics.  He can be e-mailed at

Copyright © 2017 Raymond Matison - All Rights Reserved

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