Caught in A Trap

December 15, 1951 — Marquis Childs

The Mossadegh Project | September 29, 2023                        

United Features syndicated columnist Marquis Childs on the British dilemma in Iran.

Washington Calling
Importance of Colonialism
To Britain Now Assessed

Marquis Childs (1903-1990)

LONDON, Dec. 14—This nation today finds itself in a particularly cruel kind of trap. The nature of that trap helps to explain much of the trouble in which the British are era now so unhappily tangled.

The colonialism of a vanished era relied on gunboat diplomacy. A show of force, as the quaint phrase was, sufficed to keep “native” populations in order. A few gunboats flying the Union Jack steamed into the harbor or up the estuary and any threat of trouble usually evaporated.

That colonialism in many areas produced huge rewards for British investors. The riches of the earth were taken out in the form of tin, gold, and rubber, and very little was put back. How great a prop this was to the financial structure of the homeland had scarcely been realized until the prop was reduced to a mere fraction of what it once was, and a shaky fraction at that.

To hang onto this colonialism in the new era when gunboat diplomacy is no longer possible is to invite the kind of explosion in process in Iran and Egypt. But while that is clearly understood by many in Britain, they also know that to liquidate it is to cut off sources of dollar earnings desperately needed. That is the character of the trap that pinches so cruelly, and whether there is a reasonable way out of it short of disaster no one can say with assurance.

THIS HELPS to explain why the British Labor government, and in particular Herbert Morrison as foreign minister, blundered so badly in the Iranian crisis. After a long delay the figures on the profits of the Anglo-Iranian Oil Company for 1950 have been released.

They show gross profits before taxes of about $346,500,000. This figure is deceptive, since part of the revenue comes from oil taken from the Island of Kuwait in the Persian Gulf and part of it from other operations of Anglo-Iranian. But by far the largest share was derived from the oil of Iran and the operations of the world’s largest refinery at Abadan.

The Iranian share under the old contract was about $48,000,000, with perhaps another $18,000,000 in customs and other revenues. An additional 48,000,000 would have gone to Iran under a new contract offered during the negotiations.

THE LOSS of the Iranian revenue since the refinery closed has meant a worsening of the British financial picture. It has been necessary to buy oil with dollars when dollars are needed for so many other things.

But the desire to cling to every penny of revenue from the outside is not the sole explanation of why the Iranian matter was so tragically muffed. Another reason is an inherent provincialism coloring the attitude of many Laborites to the rest of the world. They have been so anxious to better the lot of the British working-class family that they have conveniently ignored the base on which this betterment was built.

Obviously, the first step toward a more rational relationship was to see that Iran got a larger share of the revenue. Some members of the Labor Party were acutely aware of this and of the peril of simply drifting with the old colonial tide.

When they urged a new policy of reallocation on Morrison, they were met with objections somewhat indignantly expressed. What, said Morrison, do you mean—that we should turn more money over to the corrupt upper class in Iran? Isn’t it perfectly clear that they will keep it and that none of it will go to benefit the poor, landless peasants living in squalor and misery?

ALL THAT was perfectly true. But, so far as Britain’s position was concerned, it was irrelevant since the basic trouble lay in the great disproportion between what Britain was getting and what Iran was getting. Not until some Iranians got a larger share of this revenue could any internal improvement be even potentially possible.

With the able assistance of Foreign Minister Anthony Eden a plan is being developed to put the Iranian oil operation under control, for the time being, of the World Bank, which is a United Nations agency. It is possible that this last chance may retrieve a situation deteriorating with evermore explosive violence.

But in still another part of the world the same dilemma confronts the British in an even more aggravated form. That dollars earned in Malaya take on an added importance in view of losses elsewhere. [Malaysia] But to hold Malaya at all, in the face of a really determined Communist drive, may well be beyond British capacities.

Richard Stokes’ Second Thoughts on Iranian Oil (1951 Letter)
Richard Stokes' Letter to Clement Attlee, Aga Khan Concurs (1951)


Related links:

George W. Perkins: British Attitude on Iran Concerns Us | Oct. 3, 1951

Where It Is Hard To Be Cool | The Evening Sun, July 16, 1951

Iran ... Inflammable | The Hawaii Times, June 28, 1951

MOSSADEGH t-shirts — “If I sit silently, I have sinned”

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