If you want to understand why Iran and the United States have been enemies for decades, start here. Not with the 1979 revolution. Not with the hostage crisis. Start in 1953, when the United States and Britain overthrew Iran's democratically elected leader because he tried to use Iran's oil wealth to benefit Iranian citizens.
The Background: British Oil, Iranian Poverty
By the early 1950s, the Anglo-Iranian Oil Company (AIOC) — later renamed BP (British Petroleum) — controlled Iran's vast oil reserves under terms that were extraordinary even by colonial-era standards. Iran received roughly 16% of oil profits. Britain received the rest. Iranian oil workers lived in extreme poverty while British executives enjoyed luxury compounds.
The AIOC was Iran's largest employer, largest taxpayer, and most powerful institution — yet it was a British company, operating on British terms, generating wealth primarily for Britain.
Mossadegh's Democratic Solution
Mohammad Mossadegh was elected Prime Minister in 1951 on a popular mandate to nationalize Iran's oil industry. His argument was straightforward: Iran's oil belonged to Iran. The revenues should benefit Iranian citizens — fund schools, hospitals, infrastructure — not flow to London.
On March 15, 1951, the Iranian parliament (Majlis) voted unanimously to nationalize the oil industry. The National Iranian Oil Company (NIOC) was established. Mossadegh became a national hero. Time magazine named him Man of the Year in 1951.
"Our long years of negotiations with foreign countries... have yielded no results this far. With the oil revenues we could meet our entire budget and combat poverty, disease, and backwardness among our people." — Mohammad Mossadegh, 1951
Britain's Response: Economic Warfare
Britain refused to negotiate a reasonable arrangement. Instead, it:
- Imposed a global embargo on Iranian oil
- Froze Iranian assets in British banks
- Deployed the Royal Navy to the Persian Gulf to intercept tankers
- Took Iran to the International Court of Justice (and lost)
- Began planning regime change
Operation Ajax: The CIA/MI6 Coup
Britain couldn't overthrow Mossadegh alone. It turned to the United States. The Eisenhower administration, fresh from inauguration in January 1953, was receptive — particularly when the British framed the issue not as oil profits, but as Cold War anti-communism.
The CIA operation, codenamed TPAJAX (Operation Ajax), was led by CIA officer Kermit Roosevelt Jr. (grandson of Theodore Roosevelt). The plan:
- Bribe Iranian military officers, politicians, and religious leaders
- Pay gangs to stage pro-Shah riots
- Spread propaganda through paid journalists
- Organize a military coup
The first attempt on August 15, 1953 failed — Mossadegh learned of the plot and arrested the coup plotters. The Shah fled to Baghdad, then Rome.
But on August 19, 1953, a second wave succeeded. Paid mobs, working with military units, overwhelmed Mossadegh's forces. He was arrested at his home. The Shah returned to Tehran.
The Aftermath: Dictatorship
The Shah, now firmly in power with US backing, established an increasingly authoritarian regime:
- Created SAVAK, a secret police trained by the CIA, notorious for torture
- Banned political opposition
- Gave oil concessions back to Western companies (now including American firms — the real prize)
- Used oil wealth to modernize infrastructure while suppressing democratic institutions
Mossadegh was tried in a military court, sentenced to three years in prison, then placed under house arrest until his death in 1967.
Why This Matters Now
The 1953 coup is not ancient history in Iran. It is living memory — a foundational national trauma. Every Iranian school child learns about it. When Iranian leaders refer to American interference, this is ground zero.
The coup established a pattern that has repeated: the United States prioritizing strategic and economic interests over the democratic aspirations of Iranian citizens. This pattern — and Iran's awareness of it — is essential context for understanding everything that followed: the 1979 revolution, the hostage crisis, the nuclear dispute, and the current conflict.
The CIA itself has acknowledged the coup. In 2013, declassified CIA documents confirmed the agency's central role. In 2000, Secretary of State Madeleine Albright acknowledged it as a "setback for Iran's political development."
"In 1953 the United States played a significant role in orchestrating the overthrow of Iran's popular Prime Minister, Mohammed Mossadegh. The coup was clearly a setback for Iran's political development. And it is easy to see now why many Iranians continue to resent this intervention by America in their internal affairs." — Secretary of State Madeleine Albright, March 2000
No formal US apology has ever been issued.
Sources
CIA declassified documents, National Security Archive at George Washington University, Ervand Abrahamian "The Coup: 1953, the CIA, and the Roots of Modern U.S.-Iranian Relations" (2013), Kinzer "All the Shah's Men" (2003), Time Magazine archives