76: Chapter 73 Chips and Counter-Chips

The day after the hostage crisis erupted, Ayatollah Khomeini publicly announced his support for the students' actions, transforming the event from an "unofficial student movement" into a "semi-official national stance." U.S. President Carter immediately announced the freezing of Iran's assets, a halt to oil imports from Iran, and began preparing for military retaliation.

On the streets of Tehran, anti-American protests reached a historic scale, estimated to exceed one million people.

Reza, through Karimi's channels, participated in the emergency consultations of the Tehran power group—not directly, but by using Najjari and Bakhtiar as intermediaries to convey his voice to the center of power.

The core message he conveyed was simple: "Khuzestan Province fully supports the stance of the Iran government, and the oil workers in Khuzestan are prepared to ensure that oil production will not be affected by this crisis under any circumstances."

This attitude was crucial because, under the pressure of the hostage crisis, what Iran feared most was internal division—if Khuzestan, the largest oil-producing region, was unstable, the country's economic lifeline would be choked off. By adopting this stance, Reza was effectively saying to the power center in Tehran: "Go ahead and confront the United States; the logistics are not an issue."

This commitment received an immediate response—the message Ayatollah Khomeini conveyed through Bakhtiar was: "Iran needs a strong local administrator to ensure the stability of the national lifeline. If Prince Reza is willing to formally assume the highest administrative power in Khuzestan Province, that is not a problem."

This was what Reza had been waiting for—nominal power.

It was not that he lacked power, but everything he had done in the past was from the position of "Governor," which, while having real power, had limited authority. Now, what Ayatollah Khomeini was willing to give him was supreme power, legitimized under the framework of the hostage crisis and "for the sake of national stability."

Reza did not hesitate and accepted immediately.

On November 10, 1979, the Iran interim government officially issued a document appointing Reza Pahlavi as the Chief Administrator of Khuzestan Province, with authority including all civil, military, and economic affairs in the region.

On the same day, he issued his first official administrative order from Ahvaz:

First, all oil fields in Khuzestan would undergo comprehensive modernization starting immediately, with the goal of increasing daily production by 30% within six months.

Second, the recruitment and training of a local oil field security guard in Khuzestan would be completely separated from the original Iran National Oil Company system and would be directly under the command of the provincial government.

Third, establish the "Khuzestan National Defense Mobilization Committee" to coordinate the military activities of all militia organizations in the province and incorporate them into a unified command system.

These three orders appeared to be in response to the pressure of the hostage crisis, but in reality, each one was laying the legal foundation for his comprehensive control over Khuzestan.

In mid-November, Fatima sent a message through Karimi's secret channel: The second batch of Persian-1 Type B had completed final assembly, and eight of them were already deployed and ready for combat use at any time.

When Reza saw this information, he marked the word "Launch" on his notebook and then sent a reply to Fatima: "Initiate the third batch; target production to double. At the same time, begin the blueprint conversion work for the Persia-2 Missile; the timeline is two months."

Persia-2 Missile was a design Reza derived by simplifying the Soviet Union Scud Missile—the range was extended from the 250 kilometers of the Persia-1 Type to 550 kilometers, and the warhead was increased from half a ton to one ton. Crucially, its accuracy would be significantly improved because Fatima had already completed the prototype improvement of the fire control system based on the Persia-1 Type.

After receiving this instruction, Fatima's first reaction was not to ask "why," but to ask "how much lead time is needed"—she was a true engineer, not asking political questions, only about the timeline.

Reza's reply was: "No lead time needed; follow the plan, but ensure the samples are ready within two months."

During the same period, Reza's move in Tehran was to formally absorb Rafsanjani into his advisory group.

Rafsanjani was a smart man who saw the situation clearly when the hostage crisis broke out—U.S.-Iran relations were irreparable from that moment on, and what Iran needed was a system that could survive long-term confrontation, not a short-term victory supported by radical policies.

He found Reza and said: "I believe your understanding of Iran is clearer than most people's."

Reza replied: "Your understanding of power is not bad either."

The two began their cooperation just like that—no oaths, no alliance ceremonies, just practical cooperation after two smart men recognized each other.

What Rafsanjani did in Tehran was to help Reza establish a communication channel within the power group, allowing Reza not only to understand the thoughts of the decision-makers but also to influence the direction of decisions at critical moments.

The first result of this cooperation came after the hostage crisis had lasted for one month.

December 2, 1979, Tehran.

The Iran interim government held a secret National Defense Committee meeting. Attendees included Ayatollah Khomeini, several key religious leaders, core military generals, and several advisors, including Rafsanjani.

The topic of the meeting was: How to respond to the potential military action the United States was about to take.

According to intelligence, the United States was preparing "Operation Eagle Claw"—a planned commando rescue mission attempting to save the hostages still being held in the embassy.

For most of the meeting, the parties argued over one issue: What posture should Iran take to respond to this potential military action—should they hold the embassy, or release some hostages first to alleviate the pressure?

Rafsanjani conveyed Reza's position at the meeting:

"The Chief Administrator of Khuzestan Province believes that this issue should not be viewed from the perspective of the hostages, but from a strategic perspective. If we hold onto the hostages, the United States will intervene militarily because of it; if we release the hostages, the United States will despise us even more because of it. Neither choice is optimal."

"Then what is the optimal choice?" someone asked.

"Let the United States see that even if they intervene militarily, they cannot afford the price," Rafsanjani said. "This requires a clear military deterrence signal—not just talk, but real, verifiable military capability."

The atmosphere of the meeting changed at this moment.

Previous discussions had revolved around "how to deal with U.S. pressure," but now it suddenly changed to "what capabilities do we have to pressure the United States?"

Ayatollah Khomeini asked a question at this time: "Do we have such capability now?"

"Not entirely," Rafsanjani said, "but Khuzestan Province has demonstrated some noteworthy military capabilities in recent tests. If the Iran government needs it, these capabilities can be officially incorporated into the national defense system."

This was an extremely subtle phrasing—it neither stated exactly what the capability was, nor where the tests were conducted, but it implied that there was something ready to be used.

The final resolution of the meeting was to authorize the Chief Administrator of Khuzestan Province to take "any measures necessary to ensure national defense security" at critical moments.

This was equivalent to giving Reza an almost unlimited grant of power.