Islamic Revolution
The Islamic Revolution (1978-1979) ousted the Shah and replaced him with the anti-American Supreme Leader Ayatollah Ruhollah Khomeini.[73] The United States government State Department and intelligence services "consistently underestimated the magnitude and long-term implications of this unrest".[74] Six months before the revolution culminated, the CIA had produced a report stating that "Iran is not in a revolutionary or even a 'prerevolutionary' situation."[75][76]
Revolutionary students feared the power of the United States, particularly the CIA, to overthrow a
new Iranian government. One source of this concern was a book by CIA agent Kermit Roosevelt Jr.
titled Countercoup: The Struggle for Control of Iran. Many students had read excerpts from the book and thought that the CIA would attempt to implement this countercoup strategy.[77]
Khomeini referred to America as the "Great Satan"[78] and instantly got rid of the Shah's prime minister, replacing him with politician Mehdi Bazargan. Until this point, the Carter administration was still hoping for normal relationships with Iran, sending its National Security Adviser Zbigniew Brzezinski.
The Islamic revolutionaries wished to extradite and execute the ousted Shah, and Carter refused to give him any further support or help return him to power. The Shah, suffering from terminal cancer, requested entry into the United States for treatment. The American embassy in Tehran opposed the request, as they were intent on stabilizing relations between the new interim revolutionary government of Iran and the United States.[66] However, President Carter agreed to let the Shah in, after pressure from Henry Kissinger, Nelson Rockefeller and other pro-Shah political figures.
Iranians' suspicion that the Shah was actually trying to conspire against the Iranian Revolution grew; thus, this incident was often used by the Iranian revolutionaries to justify their claims that the former monarch was an American puppet, and this led to the storming of the American embassy by radical students allied with Khomeini.[66]
The hostage crisis
Vice President George H. W. Bush and other VIPs wait to welcome the former hostages to Iran home
On 4 November 1979, the revolutionary group Muslim Student Followers of the Imam's Line,
angered that the Shah had been allowed into the United States, occupied the American embassy in Tehran and took American diplomats hostage with the advance approval of the leader of Iran,
Ayatollah Ruhollah Khomeini.[79] The interim government of Prime Minister Mehdi Bazargan, who
opposed the hostage taking, resigned soon after. The 52 American diplomats were held hostage for 444 days.
In Iran, the incident was seen by hardliners as a blow against American influence. Some Iranians were concerned that the United States may have been plotting another coup from the American embassy.[80] In the United States, the hostage-taking was seen as a violation of a principle of international law that granted diplomats immunity from arrest and diplomatic compounds
sovereignty in the territory of the host country they occupy.[81]
Six Americans evaded capture at the start of the crisis and were sheltered by British and Canadian diplomats until a covert operation, Canadian Caper, executed jointly by Canada and the CIA was able to rescue them. A fake film crew was created, using Canadian passports, to extract the diplomats from Iran. On January 27, 1980, the group successfully escaped through Tehran's airport. The
operation is the basis of the 2012 film, Argo.[82][83]
The United States military attempted a rescue operation, Operation Eagle Claw, on April 24, 1980, which resulted in an aborted mission and the deaths of eight American military men. The crisis
ended with the signing of the Algiers Accords in Algeria on January 19, 1981. On January 20, 1981, the hostages were released. The Iran-United States Claims Tribunal was established for handling claims of American nationals against Iran and Iranian nationals against the United States. The crisis led to lasting economic and diplomatic damage.
On 7 April 1980, Carter severed diplomatic relations between Iran and the United States and they have been frozen ever since.[84] Since 21 May 1980, Switzerland has been the protecting power for
the United States in Iran. Contrary to usual practice, the American Embassy, Tehran was not given into the charge of the Swiss Embassy. Instead, parts of the embassy complex were turned into an anti-American museum, while other parts became offices for student organizations.[85] Iranian interests in the US were initially represented by the Algerian Embassy. However, Algeria refused to continue being Iran's protecting power in 1992 resulting in Pakistan representing Iran's interests in the United States.[86]
Economic consequences of the Iran hostage crisis
Families wait for the former hostages to disembark the plane
Before the Revolution, the United States was Iran's foremost economic, technical and military partner. This facilitated the modernization of Iran's infrastructure and industry, with as many as
30,000 American expatriates residing in the country in a technical, consulting, or teaching capacity.
Some analysts argue that the transformation may have been too rapid, fueling unrest and discontent among an important part of the population in the country and leading to the Revolution in 1979.
After the 1979 seizure of the American Embassy, Carter's Executive Order 12170 froze about
$12 billion in Iranian assets, including bank deposits, gold and other properties. According to
American officials, most of those were released in 1981 as part of the Algiers Accords to release the hostages. Some assets remain frozen-Iranian officials say $10 billion, but US officials say much less-pending resolution of legal claims arising from the Revolution.
Commercial relations between Iran and the United States are restricted by American sanctions and consist mainly of Iranian purchases of food, spare parts, and medical products, as well as American purchases of carpets and food. Sanctions imposed in 1995 by President Bill Clinton were renewed by President Bush, who cited the "unusual and extraordinary threat" to American national security
posed by Iran. The 1995 executive orders prohibit American companies and their foreign subsidiaries from conducting business with Iran, while banning any "contract for the financing of the development of petroleum resources located in Iran". In addition, the Iran and Libya Sanctions Act
of 1996 (ILSA) imposed mandatory and discretionary sanctions on non-American companies investing more than $20 million annually in the Iranian oil and natural gas sectors.
The ILSA was renewed for five more years in 2001. Congressional bills in 2006 extended and added provisions to the act; on September 30, 2006, the act was renamed the Iran Sanctions Act (ISA) as it no longer applied to Libya. On December 1, 2016, ISA was extended for a further ten years.[87]
1981-1989: Reagan administration
Iran-Iraq War
American intelligence and logistical support played a crucial role in arming Iraq in the Iran-Iraq War. However, Bob Woodward states that the United States gave information to both sides, hoping "to engineer a stalemate".[88] In search for a new set or order in this region, Washington adopted a
policy designed to contain both sides economically and militarily.[89] During the second half of the Iran-Iraq War, the Reagan administration pursued several sanction bills against Iran; on the other hand, it established full diplomatic relations with Saddam Hussein's Ba'athist government in Iraq by removing it from the US list of State Sponsors of Terrorism in 1984.[89] According to the U.S. Senate Banking Committee, the administrations of Presidents Reagan and George H. W. Bush authorized the sale to Iraq of numerous dual-use items, including poisonous chemicals and deadly biological viruses, such as anthrax and bubonic plague.[90] The Iran-Iraq War ended with both agreeing to a ceasefire in 1988.
1983: Hezbollah bombings
Hezbollah, a Shi'ite Islamist organization and client of Iran, has been involved in several anti-
American terrorist attacks. These include the April 1983 United States Embassy bombing on the
American Embassy in Beirut which killed 63 people including17 Americans, the 1983 Beirut barracks bombing which killed 241 US Marines, and the 1996 Khobar Towers bombing.
In 2003, United States District Court Judge Royce C. Lamberth declared that the Islamic Republic of Iran was responsible for the 1983 attack in a 2003 case brought by the victims' families. Lamberth concluded that Hezbollah was formed under the auspices of the Iranian government, was
completely reliant on Iran in 1983, and assisted Iranian Ministry of Information and Security agents in carrying out the operation.[91] An American federal court also found that the Khobar Towers
bombing was authorized by Ali Khamenei, then ayatollah of Iran.[92]
1983: Anti-communist purge
According to the Tower Commission report:
In 1983, the U.S. helped bring to the attention of Tehran the threat
inherent in the extensive infiltration of the government by the communist Tudeh Party and Soviet or pro-Soviet cadres in the country. Using this information, the Khomeini government took measures, including mass executions, that virtually eliminated the pro-Soviet infrastructure in Iran.[93]
Iran-Contra Affair
To evade congressional rules regarding an arms embargo, officials in President Ronald Reagan's
administration arranged in the mid-1980s to sell arms to Iran in an attempt to improve relations and obtain their influence in the release of hostages held in Lebanon. Oliver North of the National
Security Council diverted proceeds from the arms sale to fund anti-Marxist Contra rebels in
Nicaragua.[94][95] In November 1986, Reagan issued a statement denying the arms sales.[96] One
week later, he confirmed that weapons had been transferred to Iran, but denied that they were part of an exchange for hostages.[95] Later investigations by Congress and an independent counsel
disclosed details of both operations and noted that documents relating to the affair were destroyed or withheld from investigators by Reagan administration officials on national security grounds.[97][98]
United States attack of 1988
In 1988, the United States launched Operation Praying Mantis in retaliation for Iran's mining parts of the Persian Gulf during the Iran-Iraq War. The attack followed Operation Nimble Archer. The attack was the largest American naval combat operation since World War II.[99] American action began with coordinated strikes by two surface groups that neutralized the Sassan oil platform and the Sirri oil platform of Iran. Iran lost one major warship and a smaller gunboat. Damage to the oil platforms was eventually repaired.[100] Iran sued for reparations at the International Court of Justice, stating that the United States breached the 1955 Treaty of Amity. The court dismissed the claim.[101] The
American attack helped pressure Iran to agree to a ceasefire with Iraq later that summer.[102]
1988: Iran Air Flight 655
On July 3, 1988, near the end of the Iran-Iraq War, the US Navy guided missile cruiser USS Vincennes, in the Persian Gulf as part of Operation Earnest Will, accidentally shot down an Iranian Airbus A300B2 during a scheduled commercial flight in Iranian airspace over the Strait of
Hormuz.[103] There were 290 civilian casualties from six nations.[104] The United States initially stated that flight 655 was a warplane, that it was outside the civilian air corridor, and did not
respond to radio calls.[105][106] Despite a formal investigation concluding that the downing was an accident in a combat environment, the Iranian government claimed the attack was
intentional.[107][108] Iran rejected mistaken identification, arguing that this constituted gross negligence and recklessness amounting to an international crime.[109] Iran sued the United States in the International Court of Justice leading to a settlement with the United States paying tens of millions in compensation to the victims' families.[110] The United States has expressed regret for the loss of innocent life with the military describing it as "a tragic and regrettable accident".[111][110]
The men of the Vincennes were all awarded Combat Action Ribbons for completion of their tours in a combat zone. The air-warfare coordinator received the Navy Commendation Medal. The medal
citation noted his ability to "quickly and precisely complete the firing procedure."[112] In 1990, Rogers
was awarded the Legion of Merit for his service as the Commanding Officer of the Vincennes, and the citation made no mention of the downing of Iran Air 655.[113]
1989-1993: Bush administration
Newly elected U.S. president George H. W. Bush announced a "goodwill begets goodwill" gesture in his inaugural speech on 20 January 1989. The Bush administration urged Rafsanjani to use Iran's influence in Lebanon to obtain the release of the remaining US hostages held by Hezbollah. Bush
indicated there would be a reciprocal gesture toward Iran by the United States.[114] Bush's national security advisor Brent Scowcroft said in 1991 it might be possible to take Iran off the terrorist list, reduce economic sanctions, and further compensate Iranians for shooting down an Iranian civilian Airbus. However, the Bush administration did not respond to Iran's gesture, even after the last hostage was released in December 1991.