Coll 28/97 ‘Persia. Diaries. Tehran Intelligence Summaries’ [‎200r] (399/749)

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THIS DOCUMENT IS THE PROPERTY OF HIS BRITANNIC MAJESTY’S GOYfeRN^fNV
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j ^PERSIA.
July 18, 1944.
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SECRET.
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Section 2.
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5zV R. Bullard to Mr. Eden.—(Received XSth July.)
Copy No.
125
(No. 286.)
h HIS Majesty’s representative presents his edihpliments to His Majesty’s
^ Principal Secretary of State for Foreign Affairs, and has the honour to transmit
&-A). herewith a copy of Intelligence Summary No. 27 for the period the 3rd to
9th July, 1944, compiled by the military attache to this legation.
^ Tehran, IQth July, 1944.
(Secret.)
V
Enclosure.
Military Attache's Intelligence Summary No. 27 for the Period
?>rd to §th July, 1944.
Political. Persian Affairs.
IN spite of the Prime Minister’s insistence that the powers of
Dr. Millspaugh must be modified in such a manner as to recognise the full
responsibility of the Government for the financial and economic affairs of the
country, and in spite of the fact that he originally had the support of a majority
of the Deputies for this attitude, in the end it was agreed that Dr. Millspaugh
should carry on for an undefined period of <c three or four ” months with
undiminished powers. At the end of that period the matter should again be
reviewed. Dr. Millspaugh has agreed that he will consult the Minister of
Finance on important financial matters and before issuing regulations, and will
keep him informed of the course of affairs so that he can reply to questions in
the Majlis; that he will collaborate with the Prime Minister in the formation of
a committee, which would include a Cabinet Minister, to conduct negotiations •
with the Allied authorities concerning current problems connected with import
quotas, navigation, transport and the feeding of the country; that he will appoint
two Deputies to himself from among the American advisers, one of whom would
be concerned solely with finance, the other with economic questions, with a view
to accelerating decisions. The Prime Minister, in accepting the arrangement,
points out, however, that it does not accord with the view of the Government
and the Majlis that the Minister of Finance should control the economic and
financial affairs of the country.
2. The conversion of the Deputies to support of the retention of
Dr. Millspaugh on his own terms was due in part to the fear that assailed them
on considering the possible economic calamities that might follow on the
departure of the American mission and in part to the knowledge that his
departure was ardently desired by the Russians and the Shah. That considera
tion alone was sufficient to dispose a number of Deputies in his favour. The
annoyance of the Russians at his retention has been clearly shown in the Tudeh
press, and Dr. Musaddiq, one of the Shah’s spokesmen on these matters in the
Majlis, has attacked the Government for yielding, and has argued that
Dr. Millspaugh’s powers are incompatible with the Constitution, since the
Minister of Finance is deprived of all responsibility and is reduced to the
position of an adviser.
3. Saed’s Government may not fall immediately, but by having had to
abandon the position he had apparently firmly taken up as regards the abroga
tion of Dr. Millspaugh’s powers, he has lost much ground. The Cabinet was
divided on the question, and that is likely to increase already existing
dissensions. The Prime Minister, the Cabinet and the Deputies/especially
Seyyid Zia, who played an important part in turning Majlis opinion against
forcing Dr. Millspaugh’s resignation, will all have earned the displeasure of
the Shah.