Iran Was A Banking Problem All the Way Through
The hostage crisis began over a banking
crisis and it ended when the banking crisis
was resolved by the bankers, not the State
Department. That is a matter of public record.
The bankers did the negotiating. The
State Department sat back and watched the
bankers get their satisfaction and then the
crisis was over. Four hundred and forty-four
days after their capture, the hostages
came home—when the bankers were satisfied
and wanted them released. This is documentable
and not even arguable. I have
letters to the Secretary of State both before
and after the Reagan administration began,
detailing this whole scene. These letters to
Secretary of State Al Haig and to President
Reagan are a matter of public record.
You must remember that I was a senior
member of the Banking Committee at the
time. I was the one who got a study in the
Banking Committee and laid this whole
thing out.
In order to understand why all this happened,
you must understand the background.
When the Shah fell in Iran, they had a
resurgence of religion, not so much because
of any religious fervor but because
of the fact that the Mullah for a long time
had been the substructure of the political
apparatus of Iran. The Mullah was the
bishop or priest of the local area. I think a
person must know the structure of most of
those eastern governments. They are more
of a tribe or a family than they are a government.
They have a religious structure in
the kind of government they have.
When the Shah went down in the fifties,
the CIA came in and gave money to the
Mullahs. This was a payoff to get them to
let the Shah be reinstated. Through paying
off the Mullahs the CIA solicited their cooperation
in reinstating the Shah. The Mullahs
needed money, just like anybody does,
to maintain their position. When money
was made available to them, they were
happy to cooperate and to influence people
to that persuasion. By doing this the CIA
helped to set the mood for the Shah's return
after they had the uprising in the fifties.
The CIA set a trend by paying money
to these people, and this is how they set
the political climate to get the Shah back
in and to maintain the climate.
The Shah was modernistic-minded, and
he was trying to get people off of nonproductive
land and move them to towns. He
did not have much sympathy with subsidies
or briberies in order to maintain a political
structure.
The CIA maintained their presence in
Iran year after year on that basis. This
same action was going on in a number of
other middle eastern countries. The Shah
kept the American financial presence involved
in Iran and other countries.
Some of President Carter's advisers mentioned
to him that this was going on in
Germany, and he bristled at this and said,
"I want it stopped." Someone on his staff
later counseled him that it was going on on
a much grander scale in such places as
Iran, and President Carter remarked that it
is still wrong. His advisers remarked that
there is no hate like the hate of a lover
spurned or like taking candy away from a
baby. At that point the Carter Administration
either cut back or cut out this financial
assistance to the substructure of the
Iranian church government.
Khomeini, who was in exile, was able to
appeal to the Iranian religious substructure
and say, "You put me in and I will be
able to put you back in power. I will give
you the financial resources through a new
religious type government to maintain your
power base." Khomeini, by making promises
that he would have an Islamic revolution
and a resurgence of religion to control
the country, and have the financial resources
to do it, was able to get the support
of the religious groups.
Out went the Shah and in went Khomeini.
He marched in without virtually any
trouble. There were some people who had
been outcast during the Shah's regime,
people like Abol Hassem Bani Sadr, who
were political theoreticians and were in
exile. Bani Sadr came back as a right arm
to Khomeini and Bani Sadr was a socialist.
A nice person, but a socialist. Bani Sadr
came back to establish a new economic
order.
There were also others such as Ghotsbedeh
who played a big part in the early
days of the revolution, but they are now
gone. When Khomeini went in, there were
a lot of elements who went to the forefront,
in particular the young people were
caught up in the radical elements, some of
them being communist.
Our State Department did its typical
thing, as it usually does, and misinterpreted
what was going on. The overthrow of
the Shah was an anti-American move...
not a pro-Soviet move.
The Iranians border the Soviet Union
and have had a distaste for the Russians in
general and communists, over the years.
There is quite a group of Muslims in biorussia
and southern Russia. Most people
do not realize that these people are not
happy and therefore the people around the
border reflect this unhappiness also. These
people distrust the Soviets.
People along the border began calling
America the great Satan and all these ugly
terms. It wasn't because of the Russians
that they did this, but because we had
spurned their Mullahs. It was the Mullahs
who were in control, and if you took
money away from the church or the religion,
of course you would be the Devil.
That is why America became the great
Satan.
Some of the people in our American
government do not have enough religion in
their souls to understand that this was a
religious revolution and had very little to
do with the Soviet Union, but had all to
do with love or hate for the United States.
The Iranians had mixed emotions. Some
loved the United States because so many
people had come here and attended our institutions
and had gotten their military
training here. They loved the American
people. They hated the elements which had
cut them off, which was the government,
the Carter people, the bureaucracy, the
elected officials and the people behind
them, such as the international bankers.
You must understand that Mr. Carter was
very close with the Rockefellers and the
Trilateralists. This contrivance was more
than political, it was a part of the international
financial manipulation.
The Embassy Was Captured
In February of 1979, the embassy was
captured by dissidents for a brief time and
then released. It showed that it could happen
and would happen. The elements were
not bashful about doing it. The United
States had every warning to know that the
Iranians might take over the embassy
again, because they had already done it.
About this time there was a movement
in America to bring our old friend, The Shah,
into this country. The Charge d'affaires,
Bruce Laingen, in Tehran, kept complain-
ing that if you bring the Shah into the
United States, you are going to have a capture
of the embassy again and hostages
taken. We have copies of these wires which
were sent to the Secretary of State and to
the Iranian desk of the State Department.
I don't think the United States has to
kowtow to terrorists and hostage-takers. If
you have warnings that tragedy can happen,
then that ought to be sufficient to
warn people to try to avoid it. One of the
things we could have done was to close the
embassy or phase back so that there was
hardly anybody there until the crisis was
over. But the United States did virtually
nothing.
These telegrams warning Washington
that a takeover of the embassy was a probability
were flying with intensity for the
best part of a year and especially during
July and August before the takeover in
October. None of this was known by the
American public. It was all kept top secret.
I [Congressman George Hansen] ended
up being investigated by the FBI, and so
was President Reagan and his counsel Ed
Meese because of the fact that I passed
those documents to President Reagan when
he was running for election. I wanted to be
sure that he was not sandbagged by the
politics of the problem. Some of the
opposition was trying to say that the Carter
papers were pilfered and were top secret
documents, and that somebody had committed
violations of the Logan Act, which
is interfering with foreign policy or releasing
top secret documents. This was preposterous
because the Iranians had published
this in their newspapers and in European
newspapers, and I decided to put it into
the Congressional Record so that the people
in this country would know. It was a
matter of public documentary record.
However, when you interfere with the establishment,
you get yourself investigated
or possibly prosecuted.
Henry Kissinger and David Rockefeller
allegedly brought the Shah into the United
States for medical treatment, treatment
which was later proven he could have received
in Panama or Egypt or a number of
other places. It did not need to happen in
the United States.
Secondly, if you are going to bring the
Shah in, at least we should have taken precautions
with the embassy so that we did
not leave a great host of Americans hanging
in the wind personally while the Shah
was brought in. There is no need to tempt
them to do something in the face of their
warnings. Precautions should have been
taken at the embassy to protect the
Americans.
Nelson Rockefeller and Henry Kissinger
worked with the Chase Manhattan Bank to
bring the Shah in. Henry Kissinger has previously
been the director of foreign policy
as the national security advisor. Of all people,
they should have known better. It
appeared that they were trying to create a
crisis.
The real truth was that the Khomeini
had gone in and disturbed the financial climate
of Iran. He was creating a socialist
situation. The big thing that he had done
was to interrupt the benefits the Chase
Manhattan Bank was receiving from the
Shah.
The Shah was a good friend with the
Rockefellers and the Chase Bank is very
political. It is involved in politics both at
home and abroad.
The Chase Bank had been on the Federal
Reserve troubled list for years. They
must keep manipulating foreign policy in
order to bail themselves out of big problems.
In this particular case, when Khomeini
came in, the Shah had been giving
the Chase Bank the oil deposits from oil
sales every day. This gave the Chase bank
a float of about $80 million dollars per
day. That is a big cash flow for the Chase
Bank that can help them shore up their
weak base.
When Khomeini came in, he cut out the
favoritism. He chopped off the Chase
Banks oil float. That got them in some
trouble. Chase Bank was saying that Iran
was owing a lot of money to western
banks, but the truth was that they had
contrived some illegal loans. Iran, like
every country, operates on debt, and they
did have about $12 billion dollars of debt
to the big banks, but they had resources to
pay it. They had big oil deposits and they
were paying on time. They were not in
arrears in their debts.
The thing that made the big banks nervous
is that the Chase Bank, which is the
flagship or the lead bank for some of these
bank loans, had contrived some illegal
loans. Normally, when it comes to taking
out a loan like that, they must have some
basis for approval. In Iran, the constitutional
thing to do was that the Shah's proposals
for loans must be approved by the
Iranian parliament. There were several billions
of dollars of loans which had not
been properly confirmed and, hence, were
considered to be illegal loans. This story
was on the front page of the Wall Street
Journal. These loans were hanging out
there, and Khomeini could possibly challenge
them as being illegal, and not pay.
Khomeini Threatens
Chase Manhattan Bank
To this point in the conflict, Khomeini
had not challenged them. The big bankers
were nervous and they knew they had to
act at the proper time. The big bankers
brought the Shah in, aggravated the situation,
and contrived the takeover of the embassy,
then complained that the Iranians
had these big loans and that they were
going into default, and in so doing force
President Carter, or at least get public support,
to freeze the assets. They then had
those assets under their control and would
not release them until there was an agreement
from Iran that would satisfy them as
far as their financial problems were concerned.
It was a big bank scam from the
beginning. The bankers precipitated the
crisis.
Congressman Hansen Went to Iran
I [Hansen] picked up the phone and
called the Iranian embassy in America and
asked the Charge d'affaires, Mr. Ali Aliagah,
if I could come and talk with him for a minute.
I did not want to go to Iran alone and
look like I was engaged in a sellout or
something. I asked the journalist Lee Roderick,
who was the head of the Scripts
news desk, to come along as a fellow witness.
Mr. Roderick currently was the president
of the National Press Club. He is a
very distinguished individual. I told him
this was not just a story, but was serious
business.
I said that I had a problem...Here is
Ramsey Clark, who can illegally get into
North Viet Nam with Jane Fonda, etc.—he
is the emissary of Jimmy Carter to Iran,
and he can't get beyond Turkey, he can't
get into Iran. People over there are shaking
their fist in the air and saying, "People
yes, Carter No!" I thought that was very
interesting. Does it mean that they like the
American people but they don't like the
government or Mr. Carter. Maybe if they
won't let Mr. Ramsey Clark in because he
represents Mr. Carter and the government,
maybe they will let an ordinary citizen
in—like me—because the Iranian people
like the American people but not the government.
Mr. Roderick said that he didn't
know why not. I suggested that I could go
in and he suggested we try.
A couple of days later I received a
phone call saying it was approved for us to
go to Iran, but just don't expect to see
Khomeini. I thought, here it is Thanksgiving,
my family is coming home, and in
Iran Carter has the Navy coming in, there
could be war going on on the doorstep of
the Soviet Union, the Arabs have control
of our oil... should I go over there? One
of my staff members said that it would
look like a grandstand play and could hurt
me politically.
I felt that I must go or I would never
forgive myself, because something might
happen if I didn't try. Of course, by the
time I got there some of the hostages had
been released, such as the minority groups
and part of the women.
When I called the airlines, I found out
that I had four hours to get to the airport
to catch the next plane. Then I called Mr.
Roderick from the Scripts League paper
and said that up until that time he had
only been a witness, but now this might be
a story and did he want to go? He said he
would call his boss. He got permission but
didn't have time to get his press clearance;
he could only go with me. We had to personally
walk our papers through the Iranian
embassy. I picked up a pair of Levis
and we barely made it to the airplane.
When we got to the Tehran airport, we
found that the Associated Press had been
kicked out because they had written something
that the Iranian people didn't like.
As I got off the airplane, the new Associated
Press people were coming in to take
the place of those who had been kicked
out. I rode in the Associated Press car to
the Continental Hotel and we got a place
to stay. That was not a nice place to stay,
under the circumstances, and it was a cold
cloudy year in Tehran. Tehran is high, like
Denver, and cold. I got into the hotel the
day before Thanksgiving.
Next came the job of making contact. I
called the Ayatollah Beheshti, who was the
head of the Revolutionary Council with the
provisional government, under Khomeini.
Beheshti spoke English.
Being an old salesman, I knew not to
ask someone if I could do something, but
rather to ask which can I do... so that
they must make a choice between two and
not turn me down. If they make a choice,
at least you get to do something. So, I
identified myself and said that I was
pleased to be in the country, etc. Then I
asked if I should see him or see the Foreign
Minister, Bani Sadr. Ayatollah Behesti
passed me off and said I should see Bani
Sadr. The next step was to contact Bani
Sadr, who spoke only French and the language
of Iran. I spoke only English and
"Pig Latin."
When I got to Bani Sadr, I told him
that Behesti had told me to talk to him. At
four o'clock on Thanksgiving day I got a
meeting with Bani Sadr. He had a press
conference just before our meeting and the
press conference ran past time, and past
our engagement. As Bani Sadr was leaving
the room I walked up to him and stuck
out my big paw [Congressman Hansen is
at least six feet, six inches tall and has a
hand like a bear.]. I told him that I would
meet with him any time that he had the
time. He turned to his aide and said to
have me come over to the Revolutionary
Council meeting that night at the senate
building.
At the senate building that evening, Bani
Sadr had Khomeini on the hot line. He
had the Revolutionary Council meeting of
sixteen people in the other room, and since
he spoke French, we wondered how we
were going to communicate. Mr. Roderick,
the reporter who was with me, was resourceful
too, because he wanted a story.
He had made friends with Eric Reuleaugh,
who was the dean of the foreign correspondents
from Paris. Eric was a sixteen-year
dinner partner of Bani Sadr in
France. Reuleaugh agreed to be the interpreter.
Reuleaugh wrote some very glowing
accounts of this meeting.
Bani Sadr said they wanted the Shah
back. I told them that they were not going
to get the Shah back. I told them that we
could make a public spectacle out of him,
but that they were not going to get him
back, and I said that our people in America
want those hostages back. Bani Sadr
told me, in so many words, that he would
like to get the hostages out of there, too,
because they constituted a threat to their
stability so long as they were there.
Khomeini, Bani Sadr, and the Revolutionary
Council were all quite anxious to
resolve this issue and to release the hostages,
but they had to find a way to do it
and to "save face" at the same time.
Leaders of any nation have a political base
to protect. If you embarrass them or undercut
them too much, then they can't
maintain power—and they can't cope with
anything like that.
President Carter was bound and determined
that we were going to get the hostages
back... and that was it. I saw that
we had to recognize the circumstances that
were responsible in a thing like this. We
needed to give some room for negotiation
so he could come back to the people of
Iran and save face when he released the
hostages.
Bani Sadr suggested either a congressional
hearing or a hearing before the United
Nations so they could air their complaints.
He then went into the next room and
spoke to the Revolutionary Council about
these two choices and they voted unanimously
that they were acceptable. I was in
no position to negotiate because I had no
credentials. I was only in Iran as an American
citizen.
We agreed that the best thing for us all
to do was for them to do the right thing
and for us to do the right thing. The best
thing for them, of course, was to release
the hostages. The best thing for us to do,
for an old friend, was for us to find out
what was bothering them and what the upheaval
was all about. My main idea was
for us to get the doors open so that the
real qualified negotiators, emissaries of the
President, State Department, etc. could get
in and get doing the job again. All I was
there for was a door opener and possibly
to use that as leverage to bring the hostages
home.
We got along famously and Eric Reuleaugh,
who had the inside track, told the
story very well. The rest of the press were
on the outside and I don't think they really
understood what was going on. Some of
them never did know what was going on.
There was a book written by the Los Angeles
Times regarding their coverage of the
hostage crisis and there was a reporter by
the name of Doyle McManus who was in
with the Libyans to be some kind of a go-between.
It was very interesting that while the
streets in America were clamoring with
people swarming against the Iranians and
the university campuses were all in an uproar,
President Carter had Ramsey Clark
in Turkey trying to get into Iran legally
(the very man that got into Viet Nam illegally,
could not get into Iran legally). With
all this turmoil going on, President Carter's
way of solving it was to have his
brother making deals in the back of the
White House with the Libyans.
Bani Sadr agreed that if we would start
hearings, that he would let me take one-half
of the hostages home with me.
Since I was on the Banking Committee
of the House of Representatives as a senior
member, I contacted the banking chairman,
Henry Royce of Wisconsin. Royce
said he thought hearings would be a good
thing to hold and he agreed to hold
hearings.
When Bani Sadr heard that, he was so
elated that he went on national radio in
Iran at midnight and announced this first
step to releasing the hostages. Iran wanted
a way out of the hostage situation. They
wanted to release them if they could do so
and save face at the same time.
When Jimmy Carter heard that we might
hold hearings, he started screaming publicly,
"No hearings!", and placing a tremendous
amount of pressure on Mr.
Royce. Jimmy Carter, who came straight
from the governor's chair to the White
House, did not understand the congressional
process, that when Congress announces
that they are going to hold hearings, they
do not hold them the next day. It takes a
long time to schedule them. We could have
had the hostages out before the hearings
were started.
Mr. Royce was forced to clarify what he
was doing and said that we are not going
to hold hearings until we get the hostages
out.
When Jimmy Carter said, "No," that
the Iranians had to give first, that created
a big problem for Bani Sadr, and I did not
bring part of the hostages home. The Iranians
would have given first if only it had
been put in a way where it looked like they
were not giving first.
Jimmy Carter, by his lack of understanding
or his politics, ended up botching
the whole thing. Things then started to deteriorate
and the hostages stayed in Iran
444 days.
Things got so bad that the Iranians did
not let those hostages go until five minutes
after Ronald Reagan became President.
After being in Iran for the better part of
a week, we had to come home. Because
Bani Sadr had stuck his neck out and gotten
it cut off, it caused Khomeini to pull
him off the front lines as foreign minister
and to put Ghotsbedeh in.
It was well known that the State Department
was not the prime negotiator in this
whole incident. The big bankers moved in
and did the negotiating with the Iranians.
They decided what the financial stakes had
to be, what banking arrangements had to
be made, what money had to be transferred,
etc., before the hostages could
come home. It was totally a big money
deal. America was held hostage while the
big bankers got their money.
Some Additional Color
The Saturday after Thanksgiving was
their Sabbath. It was on Saturday night
that I received a telephone call, very formal,
from the minister of protocol saying
that "The Ayatollah Khomeini and Foreign
Minister Abol Hassem Bani Sadr invites
you tomorrow morning at eight o'clock to
the American embassy to visit with the students
and see the hostages."
On Sunday morning the American press
were all in bed. That was their day off. I
was afraid if I did any running around to
get them out of bed and created a spectacle,
I would lose my chance, so I let them
sleep. I took Roderick and Reuleaugh with
me and the Iranian newspaper and television
were there. At eight o'clock when I
got there, nobody from the United States
was there.
When I arrived at the gate, a long,
lanky guy about my size, met me. He was
an Iranian reporter. He went and got
somebody who opened the gate. There
were guards walking back and forth along
the front of the embassy. My being an
American politician, I reached out my big
hand and introduced myself. It really was
not all that militant.
That is a mighty lonely feeling when you
go behind those big gates and they clank
closed behind you... and lock.
When I got inside, then things started
happening. A beautiful Iranian woman
who was the anchor woman for Iranian
TV chatted with me for a few minutes.
One of the guards had been educated at
Utah State University, so we talked for
awhile.
The reception room was not heated and
I almost froze as I waited for about an
hour for them to set up.
Finally they allowed the journalist Reuleaugh
to come in and he got to witness
everything. Reuleaugh interpreted for me.
Finally, after talking for awhile, they
agreed that I could see the hostages. I was
blindfolded and put in a van and driven
around the compound just long enough to
thoroughly confuse me. Then I was taken
up some stairs to a small room where three
of the hostages were. About three hostages
were kept in each room. There was a writing
table and a few other items in each
room. The hostages did not have any shoes
on (so they could not run away).
I went through a number of the rooms.
One guy had the measles and he was hoping
I could get him home. Most of the
hostages wanted me to take messages back
home for them.
The State Department was paranoid
about releasing any names, so I deliberately
had to be a little evasive about whom I
had seen.
When I came out of the embassy, there
was a guy up on top of the gate with an
American flag which they were going to
burn. Outside they were chanting, "Yankee,
go home," "Carter, no—people,
yes," etc.
Apparently because I had the courage to
go in and face off with the people in the
embassy, the man who had the American
flag and was about to burn it said, "We
have decided we will not burn the American
flag again, the American people are
our friends." For a long time thereafter
they did not throw garbage at the flag or
burn it. I felt that was an accomplishment
in itself.
When I walked out the gate, I saw thousands
of people in the street chanting and
shaking their fists. I was wishing a helicopter
would fly over about that time and
pick me up.
One Iranian started walking along with
me and poking me in the chest as he said,
"Tell your people what the Shah did to my
brother." Finally I turned to him and said,
"Tell me about it." When they saw I was
willing to listen, hundreds of those people
sat down right there in the middle of the
street to have a rap session. I could only
speak English, so a man stepped forward
and said that he would interpret. We had
about a fifteen or twenty-minute rap session
right there in the middle of the street.
That is quite a feeling to have to walk
into a mob like that in order to get to
your vehicle.
An Iranian journalist grabbed me by the
arm and said, "Come on, Congressman, I
have a taxi waiting for you." He took me
to his newspaper and showed me the proposals
of the revolution, etc. The thing I
thought was quite interesting was when he
told me the story about Kurt Waldheim
when he had come to Tehran to negotiate
for the United Nations. The Iranians took
him to the cemetery because they always
wanted to show how they had been picked
on. When the crowd got a little boisterous,
instead of saying, "Tell me about it," he
jumped into his car and scooted out of
there. The crowd about tipped him over
and threw stones at him. The best thing to
do is face them down instead of trying to
run from the problem.
President Carter was about to call out
the Navy at that time, but when he saw
that an American Congressman could walk
the streets of Iran, it took a lot of the
wind out of his sails. About the only thing
he could do then was that little desert act,
which they fouled up royally and got some
people killed with no hope of really accomplishing
their mission.
The Hostages Sat There Until the Bankers
Struck Their Deal—It Happened in Viet
Nam, Panama, and Nicaragua
This is not the first time this has happened.
Years after the Gulf of Tonkin
Resolution and the Gulf of Tonkin incident
in Viet Nam, we found out that these were
contrived incidents that the politicians in
this country could use to whip up enough
public emotion and sentiment to justify increasing
American troops to whatever level
they want. That is what got us involved in
Viet Nam. President Kennedy had screwed
up royally in causing the CIA to overthrow
President Diem and his brother. They got
deposed and killed in the process. Up to
that time Viet Nam had run their own
country and conducted the war. We were
only there as military advisers. When they
went out, there was a collapse of the Vietnamese
power structure, and the American
military went in to fill the void, and we
ended up to our ears in Viet Nam. It was
all done by American contrivance.
The Panama Canal was also a contrivance
by the international bankers. The
bankers were absolutely beside themselves
with the problem of debt control. They
could not get their money and in some
cases, not even their interest. The same is
true in other South American countries,
such as Brazil, Mexico, and Argentina.
Up to a certain point, they could show
Panama's debt as an asset. So long as the
payments were current on their balance
sheet, everything was fine. All at once
Panama was in arrears, and it became a
liability on their balance sheet. Then such
banks as Chase Manhattan show up on the
Federal Reserve troubled list. Then people
lose confidence in the bank and the bank
could go down.
The first tip of that iceberg was the Panama
debt. They owed about $2 billion
dollars. Nelson Rockefeller had gone to
Panama and set them up with a so-called
free enterprise economy, but what it really
was was an offshore banking system, similar
to the grand Bahamas, Grand Caymans,
etc. Panama gave him a freeport
agreement where the banks could operate
virtually tax-free without controls, where
the banks could wheel and deal in oil, drug
money, and everything else without reporting
through the banking laws of the United
States. For years the "Fed" has encouraged
this branch banking offshore for the
big banks, so they can get out from under
the normal rules under which everybody
else must operate in this country. It is a
double standard and has caused us a lot of
problems. These big banks have gone out
there without regulation and have gotten
themselves into a whale of a lot of trouble.
Then they manipulate foreign policy to get
themselves out, at taxpayers' expense...
either in money or blood.
The preceding was excerpted from Syndrome of Control by Lindsey Williams.