Middle East

Iran: A Case Study Part 2

The Tripartite Deal – South Africa, Germany & France

Having read the transcript of the meeting in New York, in March 1975, the plan to topple the Shah went into action. To make matters worse, a month later, France and Germany approached the Shah of Iran with a proposed economic deal. It went something like this. The French and Germans were badly affected by the 1973 rise in oil prices. They wanted to secure a long-term supply agreement with an OPEC nation, and they chose Iran.

They proposed a deal whereby Iran supplies these two countries with a long-term oil supply agreement. Payment will be made in francs and marks, not in dollars. In return, both these countries would industrialise Iran with the best, and at a faster rate than either Britain or the US. This idea very much appealed to the Shah.

The Shah did not want to end up with foreign currency that was weak. So he told the Europeans that the only way he, the Shah, would accept their currency in payment for oil, was to make the franc and mark, stronger. And the only way this could be done was to back up these two currencies with gold. And South Africa was the place to get the gold.

So, South Africa was drawn into this tri-partite deal. And the final deal went something like this: France and Germany will supply Iran with advanced industrial goods, in return for a long-term oil supply agreement. In return, Iran will accept the franc and mark as payment for the oil, instead of the dollar. France and Germany will purchase gold from South Africa to give its currencies a stronger gold backing.

And South Africa would also benefit; it would get a better price, along with a long-term oil supply agreement with Iran. And both France and Germany would accelerate a program of supplying South Africa with advanced industrial goods. One of the results of this was the nuclear reactor at Koeberg, in the Cape. This was among many other deals that took place from this tri-partite accord.

In Europe, Germany and France led the European Community (EC) in the formation of the European Monetary System (EMS).  The idea was to marry the EMS to OPEC. And OPEC countries would deposit their surplus funds in select French and German banks, which would then lend them to other countries in the Third world. With those credits, the under-developed countries could begin to gain access to European high-technology exports.

As far as Washington and London were concerned, the Shah was already a dead man.

The 1980 Project – “Controlled Disintegration”

The secret of Khomeini’s revolution does not end with the strategic scenarios of Zbigniew Brzezinski. As the Islamic fundamentalist upsurge was numbering the days of his regime, the Shah was not denouncing the US but Britain, especially the BBC and BP.

By British, we do not mean the government of the United Kingdom – but the ruling families of the British oligarchy, which since the 1600s have ruled Britain, unchallenged, as the command center for the European feudal nobility and its associated financial interests. Policy for the oligarchy is formulated and conducted through such institutions as the Royal Institute of International Affairs, the International Institute of Strategic Studies, and in the US, through such prestigious organizations as the New York Council on Foreign Relations (CFR) and the Aspen Institute, amongst others. Since the era of Charlemagne, when humanity began pulling itself out of the mud of the dark ages that followed the collapse of the Roman Empire, the gravest danger to Europe’s noble families has been posed by the nation-state with a leadership committed to the development of its citizenry and its economy.

The scions of Britain’s oligarchical families think not in terms of months and years, but in terms of decades and even centuries. Passed on from generation to generation, the mind of the British aristocrat – like that of his Italian, Dutch, Hapsburg, and other counterparts – is shaped by the belief in the supreme preferability of the days of the lordly manors and feudal estates, when only the nobility, the clergy, and the serfs existed in hierarchically defined relationships.

For the oligarchy, the Khomeini regime which has leveled the Iranian economy and turned its potential citizens into rampaging mobs is the shape of “things to come”. The destruction of Iran’s cities, the forced reversion of Iran to an agricultural rather than an industrially developing nation, the cancellation of Iran’s German nuclear energy program by Khomeini have been praised by Britain’s ruling class., not only as a model  for the underdeveloped sector but for the western industrial nations as well.

There is no tactic, no geopolitical strategy of the British oligarchy that, in the final analysis, is not subordinated to that long-term goal.

But this project might remain simply the dream of a class of men who had long outlived their usefulness were it not for the fact that this policy was also in line of the US financier elite. That includes the US government. It is the policy that stands behind such slogans as “postindustrial society”, “zero growth”, “environmentalism”, and the “do your own thing” amorality of the mind-destroying drug-rock counterculture.

In 1975, this policy was officially incorporated in the form of the CFR 1980s Project, a 30-volume prospectus for the next decade. The brains behind this was John D Rockefeller 3rd, the eldest brother of David. Participants in the project moved to Washington with the Carter administration in 1977. Carter himself was selected by David Rockefeller as the next US President in 1974, at a Trilateral Commission meeting in Tokyo. The general theme of these papers is “controlled disintegration” of the world economy: the report does not attempt to hide the famine, social chaos, and death this policy will bring upon most of the world’s population.

Not made public until 1979, these papers explained that the world financial and economic system needed a complete overhaul, according to which control of key sectors such as energy, credit allocation, and food would be placed under the direction of a single global administration. Overseeing the apparatus would be a team of corporate managers drawn from the ranks of the Anglo-American oil companies and its sister banks. The object of this project would be the replacement of the nation-state and global supervision by their entities, such as the UN, the IMF, and the World Bank.

Carter’s National Security Advisor was Zbigniew Brzezinski(ZB), a Rockefeller geo-strategist. In Washington, a small number of managers, under ZB, were responsible for the downfall of the Shah. Working under this administrative elite is a stable of Middle East and Iran specialists with long experience in the field. Many officials in Washington were aware that the US was quietly giving support to the forces opposed to the Shah that were then gathering around Khomeini. But only a few knew the strategy behind the ongoing US intelligence contacts with Khomeinis advisors.

The driving force in the Carter administration behind the “Islamic card” against the Soviet Union was ZB. Gradually, his “Islamic card” came to dominate the policy of the US towards the entire Middle East. He issued his famous proclamation that the region was “an arc of crisis” stretching from North and East Africa through the Middle East, Turkey, Iran, and Pakistan.

It would be a mistake to take at face value ZB’s declarations that the primary target of Washington’s alliance with Islamic fundamentalists is the Soviet Union. The primary target is the economies of America’s allies in Western Europe. And that primary weapon is oil.

When London discovered that it could not dissuade France and Germany from the EMS project in 1977, using ordinary deterrents – the green light was given to speed up the destabilization of Iran. The chief countries of Western Europe, along with Japan, are totally dependent on their oil supplies from the Persian Gulf region. By bringing down the Shah and spreading chaos throughout the Middle East, the Anglo-Americans calculated they could knock out Europe with the threat or actuality of an oil cut-off. In October 1979, Business Week made the threat public.

“It may be that an Arab banking system funneling petrodollars through the European Monetary System will replace the current domination of the world’s financial system by American banks. This depends, of course, on OPEC’s willingness to play the power-broker part. If it refuses there is another scenario that many still think unthinkable, open warfare, in which either the industrial West as a group, or the US acting alone, gives up trying to work with OPEC and instead invades the oil fields.”

An invasion would not be calculated to seize the oil supply for the US – but to deny it to Western Europe and Japan.  The body blow to the Western European economies would knock out the EMS.

Until Khomeini took over, Iran was on its way to becoming the premier example of the process of industrialization in the underdeveloped world. The driving force of the country’s industrialization was oil production under the National Iranian Oil Company (NIOC).

In 1978, NIOC was the 2nd largest oil company in the world, after Saudi Aramco. In the year before the revolution, it produced over 6m barrels of oil per day (bpd).

The Shah’s economic advisors were also planning for the future. In 1978, 32 nuclear power plants were either under construction or on the drawing boards, most of them to come on line before 1990. France and West Germany held contracts to construct $30 billion worth of nuclear installations.  Steel was the centerpiece of Iran’s transformation into an industrialized nation. The Sar Chesmesh Copper Mining company had made Iran the 6th largest producer in the world, producing some 142,000 tons of copper annually. Tabriz, Iran’s second city was the site of the huge Tabriz Machine Tool Plant. This multi-billion dollar complex, constructed with French and German input, annually produced 10,000 tons of drills, pumps, lathes, milling machines, compressors, and cutting and stamping presses.

Within 6 months, Khomeini’s revolution had completely reversed the work to pull Iran up out of the Middle Ages. Immediately, $52bn worth of contracts in a dozen different areas were cancelled. This led to depression, as hundreds of other smaller projects went down the tubes as well.

Among the cancelled projects were several nuclear plants that had been in advanced stages of completion, worth at least $15bn; the $1.1bn Teheran airport; the $1.9bn Sar Chesmesh copper works ; the $1.3bn Teheran metro system; the $2.9bn  Bandar Abbas steel works,; a $3.3bn Mitsui Japanese plant for petro-chemicals; a 2nd gas pipeline to the Soviet Union, named Igat 2, worth $3bn, a multi-billion telecommunication system; several entire railway systems, a new port at Bandar Abbas, oil refineries, shipbuilding plants, steel works, and electrification projects.

It would be well to note that Henry Kissinger was heard to mutter, when he heard about these deals. He said:” we are not going to create any new Japans!”

The heartbeat of the Iranian economy, NIOC oil output was shut down after May 1979, with oil production dropping from 6m bpd to 1m bpd.

In industry, the Khomeini regime has managed to destroy nearly everything the previous regime had built. In 1979, the cooling towers of the two German built power stations in Busher were converted into wheat silos!

Many of the nation’s city dwellers have turned to opium, as alcohol is banned. As one Iranian described the situation “the remaining literate and sensible Iranians feel trapped. Their own expectations are dimming and they are left with no alternative but drugs. There was hardly any opium before the revolution; now it is everywhere. It reminds me of what the British did in China in the last century. You look at that population: they just sit there and watch the country being destroyed, and they become politically passive. That is what is happening in Iran.”

The Takedown of the Shah

Were we to select a date for the beginning of the Khomeini revolution, it would be November 1976.  It was in that month that Amnesty International, the worldwide “human rights” organization issued its report; charging brutality and torture of political prisoners by the Shah of Iran. True, the groundwork had been laid, but the AI report was the gunshot that started the war. One of Washington’s staunchest allies had been declared to be expendable. It is fairly common knowledge that Amnesty International is a front for British Intelligence.

The Shah was almost a perfect victim. According to almost every Iranian who had access to the inner circles of the Shah’s court, the Iranian elite was unrivaled in corruption and venality. The 1976 Amnesty International report put an already vulnerable Shah on the defensive.  After Amnesty’s declaration of war, scores of radicals sprang into action against the Shah. In Iran, there was only one organization of any importance to link up to the Muslim Brotherhood, and the clergy.

The other arm of Khomeini’s revolution was the coterie of experienced, western-trained, intelligence agents who clustered around the clergy such as Ghotbzadeh, Bani Sadr, and Ibrahim Yazdi.  Yazdi had been constantly at Khomeini’s side outside Paris at Neauphle-le-Chateau, along with Bani Sadr and Ghotbzadeh – the inner circle of Khomeini’s “Paris advisors”.

It is August 1978. Trouble had been brewing in Iran for a year. The Shah seemed oblivious to the simmering volcano beneath him, and he continued to place his trust entirely in the Savak and the security services. That was his biggest mistake.  Savak’s head was Hossein Fardoust, a childhood friend of the Shah. Fardoust was plotting against the Shah from late 1976.

In early August 1978, Iran was ripped by the worst act of terrorism in history.  Then in September, the Shah instituted martial law. The next day, 500 people were killed in demonstrations.


Without the BBC, there would have been no Khomeini. During 1978, the BBC stationed dozens of correspondents throughout the country. BBC reporters, often part-time stringers for Khomeini, sometimes full-time British nationals in the employ of MI6, worked as the intelligence service for the revolution.

As soon as a small incident occurred in some village, the BBC reporter would relay the news to BBC headquarters in Teheran. Within hours, BBC Persian-language broadcasts would beam exaggerated accounts of the incident to all Iran. Functioning as the national loudspeaker for the mullahs and their sympathizers, each day the BBC would beam into Iran gory accounts of alleged atrocities committed by the Iranian police – often without checking the veracity of the report. The Iranian government was never given a chance to rebut.

Neighboring Iraq, which had watched Khomeini’s opposition to the Shah carefully, took action on 27 September 1978, and placed him under house arrest in Najaf, the Iraqi holy city. A short while later, Khomeini was expelled from Iraq, and went to Paris.

British Petroleum – BP

It had gone unnoticed that during the entire year of 1978, negotiations were proceeding between the government of Iran and the oil consortium represented by BP. Talks on renewing the 25-year contract that began in 1953 after the Anglo-American intelligence coup that restored the Shah to the throne, had started in January 1978 and continued throughout the year. By October they had collapsed.

Iranians on the inside of the negotiations say that the British were blackmailing Iran during the years preceding the contract’s end by refusing to honor an agreement to buy most of Iran’s oil production. Although the BP consortium had the authority to purchase up to 8m bpd from Iran by 1978, and had agreed to a minimum of 5m bpd, they were contracting for only 3 or 4m bpd. This forced Iran to adjust its income expectations, and try to market the oil independently, which they had been successfully doing.

Now, in October 1978, BP rejected NIOC’s demands out of hand, refusing to promise to buy Iranian oil, but demanding the exclusive right to buy that oil should it wish to in the future! The Shah and NIOC flatly rejected BP’s final offer, and it appeared that if the Shah overcame the revolt, then Iran would be free in its oil sales policy in 1979, able to market its own oil to the state companies of France, Spain, Brazil, and many other countries on a state – to –state basis.

Almost simultaneously, the first signs of worker unrest began in the Iranian oil fields. Oil output slowed. In the middle of the Iran-BP negotiations, Iran’s chief asset – its enormous oil reserves – was suddenly eliminated as a chip for bargaining. Iran’s oil workers were organized by a team of radicals sent into Iran by the Bertrand Russell Peace Foundation.

Capital Flight

Almost at the same time, capital began leaving the country – a flight organized through BP channels, and among Iran’s financial elite. This elite represented primarily in certain Bahai cult, Jewish, and other bankers and merchants, had family connections to the British merchants and BP dating back to the 19th century. In October 1978 alone, $700m left Iran through channels controlled by the Iranian Jewish community.

None of this would have occurred without a green light from the British, whose intelligence service watches the goings-on in the Persian Gulf markets with extreme care. For 2 centuries the British have controlled the smuggling and drug trade in the Gulf as a way station between Asia’s Far East Golden triangle and the West. Through these channels, vast amounts of arms and ammunition were smuggled into Iran to feed the rebellion – and money was smuggled out.

In the international domain, conditions were ripe for the Shah to pull a political coup against the British. Many countries were waiting for the Shah to act, and they would have stepped into the breach. But the Shah did not act.

On January 16, 1979, the end came for the Shah. He and his family left Teheran, first for Egypt, then Morocco, and finally to Panama; and then to New York. In the interim, the Shah had appointed a prime minster to run the country.

On February 2, 1979, Khomeini and his entourage land at Teheran’s airport. Khomeini promptly formed a provisional government, headed by one of his people, Mehdi Barzagan.

On February 9, the first organized armed insurrection in Iran began at an air force base outside Teheran.  The army was ordered to put down the rebellion. But the army did not move. Resistance to the army’s decision was met with summary execution. All across Teheran, dozens of other officers were shot by hit teams under General Fardoust’s control. In the next 48 hours, up to 350 officers of the top command were murdered by professional assassination teams. They were senior officers in a command position of logistical control, communications, and mobile units.

Professionals in the military field were amazed at how easily the 350,000 Iranian armed forces were paralysed and disintegrated. Repeatedly, in this connection, one name comes up: General Robert E Huyser of the US Air Force.

Then serving as the no 2 man in the NATO command under Alexandra Haig, Huyser was sent to Iran on January 2. From January 3 to February 4, Gen Huyser met with the leading generals of the armed forces command every day.

On January 16, the Shah left the country on “vacation” – never to return. The army was restive and disoriented.  The Shah went to Egypt and then Morocco, and in both places the military leadership called the Shah and begged him for orders to move against Khomeini. The Shah refused to give the orders. Later, he would say that he was waiting for permission from Washington to confront Khomeini directly, a remark that disgusted many Iranians who took it to mean that the Shah was openly admitting, finally, that he was a puppet of Washington.

Gen Huyser, in constant contact with Brzezinski, told the generals that they must not move militarily against Khomeini, no matter what might happen. If they did, Huyser said, the US military would disown them, halt all supplies of arms and spare parts, and “cut them off at the legs”.

Huyser foiled several attempted coups. His main function was to assure the generals that when the moment came the US would support a military takeover of Iran. Contented with that assurance, many generals simply sat back and waited and did nothing when armed mobs took to the streets. One thing is certain: without General Huyser’s mission, Khomeini would not have come to power so easily. Iran would have faced a bloodbath and civil war. According to former high-ranking Iranian officers, Khomeini would have been instantly assassinated by the army intelligence divisions, and his followers disorganized. That never happened. In the next issue we will discuss the Rockefeller link to this, and the double-cross by Khomeini against his Anglo-American sponsors.

London and New York had succeeded in their plans to topple the Shah of Iran. They also replaced him with Khomeini. And now the fun starts when Khomeini double-crosses his backers. This will be discussed in the next article.

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