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The government of Iran is overthrown by Iranian rebels and the CIA in a coup codenamed Operation Ajax. The coup was planned by CIA operative Kermit Roosevelt after receiving the blessings of the US and British governments. Muhammad Mosaddeq is deposed and the CIA promptly reinstates Shah Mohammad Reza Pahlavi on the throne. The Shah’s secret police, SAVAK, trained by the CIA and Israel’s Mossad, are widely perceived as being as brutal and terrifying as the Nazi Gestapo in World War II. British oil interests in Iran, partially nationalized under previous governments, are returned to British control. American oil interests are retained by 8 private oil companies, who are awarded 40% of the Iranian oil industry. US General Norman Schwarzkopf, Sr. (father of the general with the same name in the 1991 Gulf War) helps the Shah develop the fearsome SAVAK secret police. (Shalom 12/12/2001; Tanzer 2/28/2002) Author Stephen Kinzer will say in 2003, "The result of that coup was that the Shah was placed back on his throne. He ruled for 25 years in an increasingly brutal and repressive fashion. His tyranny resulted in an explosion of revolution in 1979 the event that we call the Islamic revolution. That brought to power a group of fanatically anti-Western clerics who turned Iran into a center for anti-Americanism and, in particular, anti-American terrorism. The Islamic regime in Iran also inspired religious fanatics in many other countries, including those who went on to form the Taliban in Afghanistan and give refuge to terrorists who went on to attack the United States. The anger against the United States that flooded out of Iran following the 1979 revolution has its roots in the American role in crushing Iranian democracy in 1953. Therefore, I think it’s not an exaggeration to say that you can draw a line from the American sponsorship of the 1953 coup in Iran, through the Shah’s repressive regime, to the Islamic revolution of 1979 and the spread of militant religious fundamentalism that produced waves of anti-Western terrorism." (Stephen Kinzer 7/29/2003)
In December 1978, President Carter’s National Security Adviser Zbigniew Brzezinski says, “An arc of crisis stretches along the shores of the Indian Ocean, with fragile social and political structures in a region of vital importance to us threatened with fragmentation. The resulting political chaos could well be filled by elements hostile to our values and sympathetic to our adversaries.” (Time 1/8/1979) There is widespread discontent and rioting in Iran at the time. State Department official Henry Precht will later recall that Brzezinski had the idea “that Islamic forces could be used against the Soviet Union. The theory was, there was an arc of crisis, and so an arc of Islam could be mobilized to contain the Soviets.” (Scott 2007, pp. 67) In November 1978, President Carter appointed George Ball head of a special White House Iran task force under Brzezinski. Ball recommends the US should drop support for the Shah of Iran and support the radical Islamist opposition of Ayatollah Khomeini. This idea is based on ideas from British Islamic expert Dr. Bernard Lewis, who advocates the balkanization of the entire Muslim Near East along tribal and religious lines. The chaos would spread in what he also calls an “arc of crisis” and ultimately destabilize the Muslim regions of the Soviet Union. The Shah will later comment in exile, “I did not know it then, perhaps I did not want to know? But it is clear to me now that the Americans wanted me out. Clearly this is what the human rights advocates in the State Department wanted. What was I to make of the Administration’s sudden decision to call former Under Secretary of State George Ball to the White House as an adviser on Iran? Ball was among those Americans who wanted to abandon me and ultimately my country.” (Engdahl 1992) While there is later debate about US policy towards Iran actually is at this time, it will be noted that the Carter administration had “no clear policy” due to internal divisions and confusion. (Keddie 2003) The Shah abdicates on January 16, 1979, and Ayatollah Khomeini returns from exile to Iran on February 1, 1979, taking over the government. Brzezinski will attempt to create a de facto alliance with Khomeini’s new fundamentalist government, but his efforts will come to a half with the Iranian hostage crisis in November 1979 (see February-November 4, 1979).
After the Shah Mohammad Reza Pahlavi is deposed in Iran and Ayatollah Khomeini takes over as Iran’s new leader in February 1979, the US is interested in continuing to work with the Iranian government. At first the US is taken aback by the new fundamentalist Islamic government, and National Security Adviser Zbigniew Brzezinski contemplates fomenting a military coup to stop Khomeini. But Khomeini is fiercely anti-communist, and Brzezinski soon decides that Iran’s new government can become part of an effective anti-Soviet alliance he calls the “arc of crisis’ (see November 1978-February 1979). The US embassy in Teheran, Iran, remains open, and more US officials come to Iran and begin tentative talks there. (Dreyfuss 2005, pp. 236-243) The CIA in particular begins secretly collaborating with Iranian intelligence, providing information about the Soviet Union, Afghanistan, and Iraq. The CIA and Iran both covertly work to destabilize the pro-Soviet government in Afghanistan. (Dreyfuss 2005, pp. 264-265) In early November 1979, Brzezinski secretly meets with Iranian Prime Minister Mehdi Bazargan, as well as Iran’s foreign minister and defense minister, in Algiers, Algeria. But shortly before the meeting, the US agrees to allow the Shah, dying with cancer, to come to the US for medical treatment. Khomeini is enraged, and on November 4, just three days after the Algeria meeting begins, Khomeini arranges for students to take over the US embassy in Teheran and seize hostages. This realigns political forces in Iran and allows Khomeini to sideline Bazargan and other others meeting in Algeria, rendering the negotiations there moot. Brzezinski’s attempts to create a de facto alliance with Iran collapse. The US hostages will be held for over a year before finally being freed. (Dreyfuss 2005, pp. 240-243)