To his credit, the young shah had tried to mollify the outright plunder of his country’s natural resources after the war by urging the United States and Great Britain to share the profits from selling Iranian oil with Iran. Still just a figurehead leader, he argued that letting his country keep half of the profits would underwrite domestic prosperity and undercut the gathering socialist and nationalist political movements. The idea was rejected out of hand by the powerful Anglo-Iran Oil Company, one of the richest private corporations in the world. Outraged Iranians rallied behind the odd but charismatic Mohammed Mossadeq, a dour, frail, but principled descendant of the family that had ruled Iran for almost two hundred years before the Pahlavi family seized power. Voted prime minister by the Majlis in 1951, Mossadeq immediately did what the shah would never have dared; he defied the great powers by enforcing nationalization of the oil industry. The move was hugely popular at home and so potentially world-altering—a Third World country asserting ownership of its own resources—that Time magazine named Mossadeq its “Man of the Year.” In a speech before the United Nations, Mossadeq said, “The oil resources of Iran, like its soil, its rivers and mountains, are the property of the people of Iran.” While self-evident, the concept proved much too bold. The financial interests of the Anglo-Iran Oil Company and America’s concern that Mossadeq would drift further toward a centralized socialist system and into the Soviet sphere combined to inspire a coup d’état, which was ordered by President Dwight D. Eisenhower and (with perhaps fewer pangs of conscience) by Britain’s most famous diehard colonialist, Prime Minister Winston Churchill.
The young Pahlavi was perfectly situated to legitimize this plot. Through nearly all of its history, reaching back to ancient Persia, the country had been ruled by kings called “shah.” Pahlavi’s father had assumed power after ousting the nearly two-hundred-year-old Qajar dynasty, but assumed the title “shah” only with the approval of Iran’s Congress, the Majlis. In those years, Iran was gradually evolving into a representative democracy, and the ouster of the elder shah during the war had speeded that transition. Mossadeq’s popularity made it appear as though the young shah would remain an honorary figure at best. Roosevelt preyed upon Pahlavi’s vanity and royal presumption by offering him “full” power (Iran would remain, of course, America’s client state). The shah’s support would give an authentic Iranian imprimatur to what was in truth a foreign-backed coup, enabling America to claim it was “rescuing” the government, not overturning it. A more honorable, selfless man would have said no.
Pahlavi said yes. Roosevelt shuttled back and forth to meetings with the shah in 1953, hidden in the backseat of a car under blankets, plotting to dismantle Iran’s elected government and hand full power to him. By then, Mossadeq had been weakened politically by the financial fallout from nationalization; Iran lacked the know-how and resources to profitably operate its oil pumping and refining plants. Its customers found new suppliers, and economic stagnation set in. The affluent upper class that had profited under the old oil arrangements, including military leaders, had grown increasingly impatient with this radical nationalist experiment. Mossadeq turned in vain to the Eisenhower administration for help in brokering a deal with the British that would restart its oil industry under Iranian supervision. Instead, Washington decided to shove the vulnerable old man offstage.
Roosevelt orchestrated street demonstrations and a campaign of false stories in the Iranian press against Mossadeq, and systematically bought off military leaders, who arrested the prime minister on trumped-up charges of treason (he was convicted and after a three-year term in prison remained under house arrest until his death in 1967). During the days of the actual coup, the shah fled to Rome with his wife until it was safe to return—“to avoid bloodshed,” he said, most conspicuously his own—and then assumed the throne offered on a platter by his American friends, adorning himself “Light of the Aryans” and with pomp befitting a position known historically as the “Peacock Throne.” The new regime was offered a far better deal on oil revenues, and the shah promised nothing less than the complete modernization of his country in his lifetime, to make it the financial and cultural equal of Europe. The United States subsidized this Pahlavian fantasy, cynically betraying its democratic principles in the name of containing communism and facilitating the uninterrupted flow of oil. And to some extent it worked, most of all for the United States. The shah’s Iran helped keep the Soviet Bear from Middle East oil supplies and provided a strong guarantee of Western access. Roosevelt’s successful plot became the textbook CIA-engineered coup, and its fame spread well beyond the secret walls of Langley, Virginia. An article by Richard and Gladys Harkness, in the 1954 Saturday Evening Post (widely reprinted in Iran), laid out the whole scheme as a clever American triumph against the creeping Red Menace. It made Roosevelt a legend in the world of clandestine operations. Nearly a quarter of a century later Carter would be toasting the elaborately bedecked, gray-haired shah’s “stability.”
Eventually the shah did wrest billions in oil profits for his nation and presided over several decades of relative prosperity, empowering women and moving his country away from literal adherence to the Koran. His rule became increasingly strict and self-assured as he became more and more self-deceived, believing that God Almighty was behind the squalid machinations that had placed him in power, and that his state decisions, being divinely inspired, were infallible. “My visions were miracles that saved the country,” he boasted to Italian journalist Oriana Fallaci in a series of interviews two decades after the coup. With American help he had blossomed into an openly arrogant monarch, proud of his unflinching willingness to shoot dissidents, convinced of the inherent inferiority of Western-style democracy. He presided over a military large and modern enough to rival Israel’s but wasted billions on ill-conceived economic schemes. Despite his “expert” personal reconstruction of Iran’s economy and culture, the majority of his people stayed poor, and remained devout. Land reforms improved agricultural production, but not fast enough for Iran’s mushrooming urban population, and by the mid-1970s more than 40 percent of its people were undernourished. Oil wealth fed urban enclaves of educated, Westernized, well-connected citizens, loyal to the regime, but the disparity between this small affluent class and the majority of Iranians was vast and growing. By the twentieth year of his reign, the shah was deeply unpopular, reviled by Iran’s educated class as a tyrant and American puppet and by the multitudes of poor and uneducated for his efforts to dismantle their religious traditions. As discontent grew, the usual cycle of repression and rebellion set in. The shah relied more and more on SAVAK, his secret police, to root out and smash rebellion, which spread discontent and turned it into hatred. Dissident mullahs such as the Ayatollah Khomeini, too popular to imprison or kill, were exiled.
Carter’s natural inclination was to knock the shah down a peg by insisting on democratic reforms in Iran, but the country’s geopolitical importance and the uncertain prospect of what might come after the monarchy counseled a warm outward acceptance of the status quo. In private, the shah was pushed to make his country more tolerant and liberal, and he responded with democratic gestures that had the unintended effect of uncapping decades of suppressed anger. As Iranians tasted new freedom to express themselves, the volume of protest grew and the population was further emboldened. Long-simmering economic problems came to a boil. There were crippling strikes and a mounting series of humiliating and threatening street demonstrations that the shah dared not ruthlessly suppress. No one opposition faction had the power to remove him, but together they were unstoppable. By 1978 the Peacock Throne was teetering. Not that American intelligence and military assessments realized it; it was uniformly predicted that the shah would weather the storm.