World War II had hastened the collapse of Colonialism in the world, with Marxism finding very fertile ground. The Republicans didn't want to lose territory to the Communists, as they had accused Truman of "Losing China" in 1949 . . . but there were limits to American influence and power, as the Korean War was showing. Eisenhower thought he had found a solution to the dilemma with the Central Intelligence Agency (CIA), and its first chance to show what it could do occurred five months after Ike took office in June 1953 in Iran. On 22 June 1953, the final meeting at the State Department concerning regime change in Iran occurred. The meeting in-and-of-itself was merely a formality, since the decision had already been made that the current leader of Iran, Prime Minister Mohammed Mossedegh, had to be removed.
At the meeting as well was Walter Bedell
(Beetle) Smith, the Under Secretary of State. Smith, since WW II, had become one of Ike's most trusted-and-relied-upon men; no one admired Ike more than Smith. It was Smith's job to be Ike's "S.O.B.", and had become a true hard liner against the USSR after being the US Ambassador to Moscow from 1947-50. At the meeting, Smith was Ike's proxy. Kermit ("Kim") Roosevelt's plan was simple, in that if the Iranian people had to choose between Mossadegh and the Shah of Iran, Kim believed they would choose their traditional historic leader, the Shah.
The stakes were high, given the oil in Iran as well as its strategic location bordering the USSR. The cost of the covert op would be $200k, at least half of which was for the "rental mob" to be used to protest against Mossadegh, who had been labeled an unstable maniac by the Eisenhower administration. Kim Roosevelt was TR's grandson, and he was very well-connected in D.C.; it had bee "Wild Bill" Donovan that brought Kim on board in the Office of Strategic Services (the forerunner of the CIA) during WW II. After the war, Kim's specialty had become the Middle East. Kim had become an expert on the relations between Iran and Great Britain; since the first successful oil strike in 1909, Great Britain had treated Iranian oil like it was their own.
During October 1951, Mossadegh ordered all British oil employees out the nation, and then had Iranian troops occupy a huge refinery. A Western boycott on Iranian oil followed, and Mossadegh broke off diplomatic relations with Britain. It was during these developments that the U.S. government under President Truman thought Mossadegh was moving towards Communism. During November 1952, Britain sought out Kermit Roosevelt, who still had access to his high-level contacts in Iran, about a coup against Mossadegh. Kim held off Britain, since he knew Truman would be at best lukewarm to the proposal.
Kim had predicted that the Republicans would like the plan, and he was proven right when "Beetle" Smith, once apprised of the plan, wanted to get going immediately. The key of the covert operation was the Iranian army; to whom would their loyalties lie, since only a few top generals supported Mossadegh. Both Britain and the U.S. wanted to remove Mossadegh: Britain wanted Iranian oil, while the U.S. wanted the oil but also to contain the USSR.
Kim arrived in Teheran on 19 July 1953 to lead the covert op. Kim needed to move quickly and quietly in order to make all the necessary plans to mobilize-and-activate the pro-Shah mob. Kim even met the Shah in a car, with a blanket over Kim as the Shah got in the car. Kim told the Shah about the coded messages to be broadcast on the radio that were the signal to start the staged protests. By then, Kim had $1 million in Iranian currency, with only $100k earmarked for the mob. The Shah was instructed by Kim to be out of Iran when the coup occurred to not only reduce his visibility and perceived responsibility, but to also keep him safe if things went awry.
On 16 August 1953, the coup started badly, with Mossadegh firing the first shot, claiming that the Shah had tried to fire him as Prime Minister. Mossadegh stated that his only recourse was to take all power in Iran, and for a day or so the pro-Mossadegh forces had control of the streets and the government.
Everyone involved on the U.S. side was delighted, since the coup was done quickly, cleanly, and cheaply. On 23 September 1953, President Eisenhower, in a private ceremony, awarded the National Security Medal to Kermit Roosevelt. In terms of Iranian oil, Britain formed the Anglo-Iranian Charter, which eventually became British Petroleum. Iranian oil was divided up, with the British receiving 40%, while Gulf, Standard, Texaco, and Mobil dividing another 40%.
Mossadegh was imprisoned for two-and-a-half years before being released. As the decades followed, the Shah was seen by his people as a mere pawn of the West, and his government collapsed in 1979, with barely a shot fired in his defense from his own people. Eisenhower and his loyalists were so encouraged by the successful coup in Iran that more covert operations were planned, and the role of the CIA was expanded . . . the seeds for the disaster at the Bay of Pigs were planted . . .