[Marxism] How a Chase Bank Chairman Helped the Deposed Shah of Iran Enter the U.S.

Louis Proyect lnp3 at panix.com
Sun Dec 29 10:04:09 MST 2019

NY Times, Dec. 29, 2019
How a Chase Bank Chairman Helped the Deposed Shah of Iran Enter the U.S.
By David D. Kirkpatrick

One late fall evening 40 years ago, a worn-out white Gulfstream II jet 
descended over Fort Lauderdale, Fla., carrying a regal but sickly 
passenger almost no one was expecting.

Crowded aboard were a Republican political operative, a retinue of 
Iranian military officers, four smelly and hyperactive dogs and Mohammed 
Reza Pahlavi, the newly deposed shah of Iran.

Yet as the jet touched down, the only one waiting to receive the deposed 
monarch was a senior executive of Chase Manhattan Bank, which had not 
only lobbied the White House to admit the former shah but had arranged 
visas for his entourage, searched out private schools and mansions for 
his family and helped arrange the Gulfstream to deliver him.

“The Eagle has landed,” Joseph V. Reed Jr., the chief of staff to the 
bank’s chairman, David Rockefeller, declared in a celebratory meeting at 
the bank the next morning.

Less than two weeks later, on Nov. 4, 1979, vowing revenge for the 
admission of the shah to the United States, revolutionary Iranian 
students seized the American Embassy in Tehran and then held more than 
50 Americans — and Washington — hostage for 444 days.

The shah, Washington’s closest ally in the Persian Gulf, had fled Tehran 
in January 1979 in the face of a burgeoning uprising against his 38 
years of iron-fisted rule. Liberals, leftists and religious 
conservatives were rallying against him. Strikes and demonstrations had 
shut down Tehran, and his security forces were losing control.

The shah sought refuge in America. But President Jimmy Carter, hoping to 
forge ties to the new government rising out of the chaos and concerned 
about the security of the United States Embassy in Tehran, refused him 
entry for the first 10 months of his exile. Even then, the White House 
only begrudgingly let him in for medical treatment.

Now, a newly disclosed secret history from the offices of Mr. 
Rockefeller shows in vivid detail how Chase Manhattan Bank and its 
well-connected chairman worked behind the scenes to persuade the Carter 
administration to admit the shah, one of the bank’s most profitable clients.

For Mr. Carter, for the United States and for the Middle East it was an 
incendiary decision.

The ensuing hostage crisis enabled Ayatollah Ruhollah Khomeini to 
consolidate his theocratic rule, started a four-decade conflict between 
Washington and Tehran that is still roiling the region and helped Ronald 
Reagan take the White House. To American policymakers, Iran became a 
parable about the political perils in the fall of a friendly strongman.

Although Mr. Carter complained publicly at the time about the pressure 
campaign, the full, behind-the-scenes story — laid out in the recently 
disclosed documents — has never been told.

Mr. Rockefeller’s team called the campaign Project Eagle, after the code 
name used for the shah. Exploiting clubby networks of power stretching 
deep into the White House, Mr. Rockefeller mobilized a phalanx of elder 

They included Henry A. Kissinger, the former secretary of state and the 
chairman of a Chase advisory board; John J. McCloy, the former 
commissioner of occupied Germany after World War II and an adviser to 
eight presidents as well as a future Chase chairman; a Chase executive 
and former C.I.A. agent, Archibald B. Roosevelt Jr., whose cousin, the 
C.I.A. agent Kermit Roosevelt Jr., had orchestrated a 1953 coup to keep 
the shah in power; and Richard M. Helms, a former director of the C.I.A. 
and former ambassador to Iran.

Charles Francis, a veteran of corporate public affairs who worked for 
Chase at the time, brought the documents to the attention of The Times.

“Today’s corporate campaigns are demolition derbies compared to this 
operation,” he said. “It was smooth, smooth, smooth and almost entirely 

Records of Project Eagle were donated to Yale by Mr. Reed, the 
campaign’s director. But he deemed the material so potentially 
embarrassing to his patron that Mr. Reed, who died in 2016, stipulated 
that the records remain sealed until Mr. Rockefeller’s death. Mr. 
Rockefeller died in 2017 at the age of 101.

Some of the information may embarrass others as well. Hawkish critics 
have often faulted Mr. Carter as worrying too much about human rights 
and thus failing to prop up the shah.

But the papers reveal that the president’s special envoy to Iran had 
actually urged the country’s generals to use as much deadly force as 
needed to suppress the revolt, advising them about how to carry out a 
military takeover to keep the shah in power.

A spokeswoman for Mr. Carter did not respond to requests for comment. A 
spokesman for Mr. Carter at the time of the crisis was not immediately 

After the hostages were taken, the Carter administration worked 
desperately to try to free the captives, and on April 24, 1980, 
authorized a rescue mission that collapsed in disaster: A helicopter 
crash in the desert killed eight service members, whose charred bodies 
were gleefully exhibited by Iranian officials.

The hostage crisis doomed Mr. Carter’s presidency. And the team around 
Mr. Rockefeller, a lifelong Republican with a dim view of Mr. Carter’s 
dovish foreign policy, collaborated closely with the Reagan campaign in 
its efforts to pre-empt and discourage what it derisively labeled an 
“October surprise” — a pre-election release of the American hostages, 
the papers show.

The Chase team helped the Reagan campaign gather and spread rumors about 
possible payoffs to win the release, a propaganda effort that Carter 
administration officials have said impeded talks to free the captives.

“I had given my all” to thwarting any effort by the Carter officials “to 
pull off the long-suspected ‘October surprise,’” Mr. Reed wrote in a 
letter to his family after the election, apparently referring to the 
Chase effort to track and discourage a hostage release deal. He was 
later named Mr. Reagan’s ambassador to Morocco.

Mr. Rockefeller then personally lobbied the incoming administration to 
ensure that its Iran policies protected the bank’s financial interests.

The records indicate that Mr. Rockefeller hoped for the restoration of a 
version of the deposed government.

At the start of the Iranian upheaval, the papers show, Mr. Kissinger 
advised Mr. Rockefeller that the probable conclusion would be “a sort of 
Bonapartist counterrevolution that rallies the pro-Western elements 
together with what was left of the army.”

Mr. Kissinger, in a recent email, acknowledged that the prediction 
“reflects my thinking at the time” but said “it was a judgment, not a 
policy proposal.”

But Mr. Rockefeller evidently continued to advocate for some form of 
restoration long after the shah fled Tehran.

As late as December 1980, Mr. Rockefeller personally urged the incoming 
Reagan administration to encourage a counterrevolution by stopping “rug 
merchant type bargaining” for the hostages and instead taking military 
action to punish Iran if the hostages were not released. He suggested 
occupying three Iranian-controlled islands in the Persian Gulf.

“The most likely outcome of this situation is an eventual replacement of 
the present fanatic Shiite Muslim government, either by a military one 
or a combination of the military with the civilian democratic leaders,” 
Mr. Rockefeller argued, according to his talking points for meetings 
with the Reagan transition team.

An heir to his family’s oil fortune, Mr. Rockefeller styled himself a 
corporate statesman and personally knew many White House officials, 
including Mr. Carter. He had known the shah since 1962, socializing with 
him in New York, Tehran and St. Moritz, Switzerland.

As Tehran’s coffers swelled with oil revenues in the 1970s, Chase formed 
a joint venture with an Iranian state bank and earned big fees advising 
the national oil company.

By 1979, the bank had syndicated more than $1.7 billion in loans for 
Iranian public projects (the equivalent of about $5.8 billion today). 
The Chase balance sheet held more than $360 million in loans to Iran and 
more than $500 million in Iranian deposits.

Mr. Rockefeller often insisted that his concern for the shah was purely 
about Washington’s “prestige and credibility.” It was about “the 
abandonment of a friend when he needed us most,” he wrote in his memoirs.

His only advocacy for the shah, Mr. Rockefeller wrote, had been in a 
brief aside to Mr. Carter during an unrelated White House meeting in 
April 1979.

“I did nothing more, publicly or privately, to influence the 
administration’s thinking.”

Yet the Project Eagle papers show that Mr. Rockefeller received detailed 
updates on the risks to Chase’s holdings, and that even his aside to Mr. 
Carter in April had been planned out the previous day with Mr. Reed, Mr. 
McCloy and Mr. Kissinger.

Over lunch at the Knickerbocker Club in New York, Mr. Carter’s special 
envoy to Tehran, Gen. Robert E. Huyser, told the Project Eagle team that 
he had urged Iran’s top military leaders to kill as many demonstrators 
as necessary to keep the shah in power.

If shooting over the heads of demonstrators failed to disperse them, 
“move to focusing on the chests,” General Huyser said he told the 
Iranian generals, according to minutes of the lunch. “I got stern and 
noisy with the military,” he added, but in the end, the top general was 

Mr. Rockefeller had his own special envoy to try to help the shah: 
Robert F. Armao, a Republican operative and public relations consultant 
who had worked for Mr. Rockefeller’s brother Nelson, the former governor 
of New York and former vice president.

Mr. Armao became one of the shah’s closest advisers, and after Nelson 
Rockefeller died at the start of 1979, he reported to the Project Eagle 
team at Chase nearly every day for more than two years.

“Everybody had the hope that there would be a repeat of the 1953 
events,” Mr. Armao recalled recently, referring to the American-backed 
coup that restored the shah the first time he fled.

When the shah’s rule became untenable at the start of 1979, the State 
Department first turned to David Rockefeller for help relocating the 
Iranian monarch in the United States.

“Not large enough for my very special client,” Mr. Reed wrote to a 
Greenwich, Conn., broker who had offered two estates priced at around $2 
million each — about $7.4 million today.

But while the shah tarried in Egypt and Morocco, an Iranian mob briefly 
seized the American Embassy in February. Diplomats warned that admitting 
the shah risked another assault, and Mr. Carter changed his mind about 
offering haven.

Mr. Rockefeller refused to deliver this bad news to the shah, afraid 
that it would hurt the bank by alienating a prized client.

“The risks were too high relating to the CMB position in Iran,” he 
responded, referring to Chase Manhattan Bank, according to the records.

Instead, Mr. Rockefeller scrambled to find accommodations elsewhere — 
first in the Bahamas, and then in Mexico — while strategizing with Mr. 
Kissinger, Mr. McCloy and others about how to persuade the White House 
to let in the shah.

During a three-day push in April, Mr. Kissinger made a personal appeal 
to the national security adviser, Zbigniew Brzezinski, and a follow-up 
phone call to Mr. Carter. Mr. Rockefeller buttonholed the president at 
the White House.

And in a speech, Mr. Kissinger publicly accused the Carter 
administration of forcing a loyal ally to sail the world in search of 
refuge, “like a flying Dutchman looking for a port of call” — the seed 
of what became a “who lost Iran” campaign theme for the Republicans.

Mr. McCloy flooded the White House with lengthy letters to senior 
officials, often arguing about the danger of demoralizing other 
“friendly sovereigns.” “Dear Zbig,” he addressed his old friend Mr. 

Finally, in October, Mr. Reed sent his personal doctor to Cuernavaca, 
Mexico, “to take a ‘look-see’” at the shah.

He had been hiding a cancer diagnosis. The doctor, Benjamin H. Kean, 
determined that the shah needed sophisticated treatment within a few 
weeks — in Mexico, if necessary, Dr. Kean later said he had concluded.

But when Mr. Reed put the doctor in touch with State Department 
officials, they came away with a different prognosis: that the shah was 
“at the point of death” and that only a New York hospital “was capable 
of possibly saving his life,” as Mr. Carter described it at the time to 
The Times.

With that opening, the Chase team began preparing the flight to Fort 

“When I told the Customs man who the principal was, he almost fainted,” 
the waiting executive, Eugene Swanzey, reported the next morning.

The plane’s bathroom was malfunctioning. The shah and his wife hunted in 
vain for a missing videocassette to finish a movie. And their four dogs 
— a poodle, a collie, a cocker spaniel and a Great Dane — jumped on 
everyone. The Great Dane “hadn’t been washed in weeks,” Mr. Swanzey 
said. “The aroma was just terrible.”

When Mr. Reed met the plane on its final arrival in New York, he 
recalled the next day, the shah seemed to be thinking, “‘At last I am 
getting into competent hands.’”

But as he checked the shah into New York Hospital, Mr. Reed was circumspect.

“I am the unidentified American,” he told the inquisitive staff.

Mr. Reed, Mr. Rockefeller and Mr. Kissinger met again three days after 
the hostages were taken.

“Noted was the feeling of indignation as being high and nothing useful 
to say,” read the minutes.

The White House said the shah had to depart as soon as possible, but 
Project Eagle continued.

“The ideal place for the Eagle to land,” Mr. Reed wrote to Mr. Armao on 
Nov. 9, forwarding a brochure for a 350-acre Hudson Valley estate.

A week later, Mr. Rockefeller personally urged Mr. Carter in a phone 
call to direct the secretary of state to meet with the shah about “the 
current situation.” Mr. Carter did not and the shah soon departed, for 
Panama, then Egypt.

Only after the death of the shah, on July 27, 1980, nine months after 
his landing in Fort Lauderdale, did the Project Eagle team shift to new 
objectives. One was protecting Mr. Rockefeller from blame for the crisis.

Over roast loin of veal and vintage wine at the exclusive River Club in 
New York, Mr. Rockefeller and nine others on the team gathered on Aug. 
19. Amid discussion of a laudatory biography of the shah by a Berkeley 
professor that the team had commissioned, some warned that a Rockefeller 
link to the embassy seizure would be hard to escape.

Why was the shah admitted? “Medical treatment/DR recommended,” one said, 
using Mr. Rockefeller’s initials, according to minutes of the dinner. 
“This association cannot be ignored.”

But Mr. Kissinger was reassuring. Congress would never hold an 
investigation during an election campaign.

“I don’t think we are in trouble any more, David,” Mr. Kissinger told him.

The hostages were released on Inauguration Day, Jan. 20, 1981, and a few 
days later Mr. Carter’s departing White House counsel called Mr. 
Rockefeller to inquire about how the release deal affected Chase bank.

“Worked out very well,” Mr. Rockefeller told him, according to his 
records. “Far better than we had feared.”

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