From Persia to Iran ••• 241Iran's fiscal administration in the 1920s but failed to attract American in¬
vestors, Reza made the director resign and phased out his subordinates.
The US government did not step in, much to the Iranians' astonishment.
Germany was more active. An able German director built up the National
Bank of Iran in the early 1930s. After Hitler took power, German entrepre¬
neurs and advisers flocked to Iran. Reza and many of his subjects were
flattered by Nazi racial theories, because they viewed Iran as the original
Aryan nation. After World War II began and Nazi forces overran most of
Europe, the British had reason to fear Germany's presence in Iran. In 1941
a group of Arab nationalist officers briefly seized control of neighboring
Iraq. Suspecting them of pro-Nazi sympathies, Britain intervened to in¬
stall a pro-British regime. When Hitler suddenly invaded the USSR that
June, both the British and the Soviets sent troops into Iran. Once again
Iran's independence was violated. Unwilling to rule under a military occu¬
pation that threatened to undo his reforms, Reza abdicated in favor of his
son, Mohammad, went into exile, and died three years later.
Epilogue
When he succeeded his father, Mohammad Reza Shah Pahlavi seemed a
mere Western protégé. The tribes hastened to regain their lost power and
lands. The Majlis asserted its constitutional right to govern. The World War
II Allies treated Iran as a supply line, a source of oil, a convenient meeting
place, and a subordinate ally. Once the war ended, the USSR tried to set up
communist republics in northern Iran but withdrew its troops in 1946 un¬
der pressure from the United Nations. The communists then played on the
rising discontent of the workers in the Anglo-Iranian Oil Company (AIOC).
Iranian nationalists won control of the Majlis, electing Mohammad Mosad-
diq as prime minister. Because it nationalized the AIOC, Mosaddiq's gov¬
ernment became popular at home but was fiercely resented in Britain and
the US, so it was toppled in 1953 by a CIA-backed military coup. For the
next quarter century, Mohammad Reza Shah ruled Iran as a dictator. Sky¬
rocketing oil revenues enabled his government to build up its schools,
industries, and armed forces. The shah's "White Revolution" promised
changes in landownership, rural development, education, and women's
rights beyond his father's wildest dreams. It also alienated the ulama.
The shah inherited his father's authoritarian streak. When his reforms
failed to meet his subjects' expectations, he fell back on propaganda, cen¬
sorship, and his secret police (SAVAK) to stay in power. Though successive
US governments backed him as a bulwark against communism, many
Americans questioned his commitment to human rights. Iranian students