Plan Organization Director
Transcript 1 of 16
Narrator: Dr. Khodadad Farmanfarmaian
Date: November 10, 1982
Place: Cambridge, Massachusetts
Interviewer: Habib Ladjevardi
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Q. Dr. Farmanfarmaian, I think it would be helpful if we began these series of interviews by asking you to say a little bit about your family background -- about your father, about your childhood and places where you went to primary school and high school -- and then we can get to the beginning of your career in government in Iran.
A. I was born on May 8, 1928. My mother was Hamdam Khanoum and my father was Prince Abdol Hossein Mirza Farmanfarmaian. My father at the time was retired from politics and because it was after the advent of Reza Shah. You must remember that he was already an old man anyway. He was, if I'm not mistaken, Minister of War back in 1896, 1910 and 1915, Minister of Justice in 1909, Prime Minister in 1916, and generally speaking he was a powerful man of substantial influence in Persian politics for a long time, let us say from around 1890 to 1920. You know in the Qajar tradition, the crown prince was sent to hold his own court in Azarbaijan -- he took my father with him and my father at that time (around 1890) served as his Prime Minister. But of course when Mozaffar ed-Din Shah returned to Tehran after the assassination of Nasser ed-Din Shah, my father was rather young still and he was appointed as Minister of War. It wasn't until later that he became Prime Minister. He was Prime Minister for a very short period of time, owing to certain difficulties, I understand, vis-a-vis the Russian occupying forces during the First World War in Iran. When I was born, Reza Shah had already ascended to the throne for three years. We lived right next door to the King and the royal family. There are stories that...
Q. What part of Tehran was this in?
A. Our house was located on Sepah Avenue, bordering Kakh on the east and Pasteur on the north. This whole property was my father's and I'm told that the land on which the Marble Palace and the Queen's Palace were built was a gift from my father to Reza Shah at the time or shortly after the latter's ascendance to the throne.
Earlier, we had a large compound which included the Kakh and Pasteur Avenue and Institute. Kakh and Pasteur Avenue were cut out of the old compound and the Pasteur Institute was built and endowed by my father at a later date. Well, all of us lived in that compound. My father at the time had seven wives. And we all lived in around an oval-shaped garden; and his mansion was separate from all of us, located on the north side at the top of the garden, dominating the whole of the garden and our individual houses.
We went to school, first to a school called Tarbiyat which was right next door to us. After that school was closed down (reportedly because of its Baha'i connections), we were sent to Sharaf School located in Amiriyeh. The girls were sent to Nobavegan and Anoshiravan Dadgar. A few years later, when Reza Shah decided to take over our compound, we had to go and live in our summer residence in Shemiran. So the whole family moved up to Tajrish in Shemiran where my father had an estate located just to the south of the Tajrish Open Bus Terminal extending south to Kashef Street. This was a lovely large garden which was called Rezvanieh which included separate houses for each of his wives and her children. My father lived in one of the main houses in this compound which was at the time also shared by one of the senior wives.
At that time we were sent to Shapour school at Bagh Ferdows, which was just a grade school. Shortly after my father died we moved to Tehran and I went to Iranshahr High School for about a year and after that to Alborz College. At Alborz College I finished the second year of high school.
On the basis of the will of my father, the guardians, who were Haj Mohtasham Saltaneh Esfandiari, Mohsen Sadr, and Sardar ol-Ashraf, and Mr. Farzin, and my oldest brother, decided to send us abroad for further education. Since this was in 1943 and Europe was at war, a few of us were sent to Beirut, where we were enrolled at the Preparatory School (International College) of the American University of Beirut. I stayed in Beirut a full three years and in 1946 I graduated from high school or the preparatory school of the American University of Beirut.
At that time I returned to Iran and I spent only about two and a half to three months in Tehran and this was the first time I ever visited our villages between Asadabad near Hamedan and Kermanshah. This is the first time I had an impression of a village and rural life in Persia. And at that time, the landlord was the sovereign and the peasants or tenant-cultivator gave a certain share of the product to him. You might remember the distribution of the product between the tenant and the landlord: one share went for ownership, one share went for work, one share went for animal power or tractor, one for water and another for seed. Altogether there were five shares And although this practice differed in various parts of Iran, this was generally the practice that at the time prevailed in the area where we had our villages.
We had ownership of land and water and often provided seeds, but many of the tenants had their own animal power so they could have one share for that and one share for their work, so the product was distributed two-fifths for the tenants and three-fifths for landlord. There were other functions that the landlord provided as well. Now that I look back, certainly after our experience with land reform which I hope I have a chance to talk about. I have some reflections on the circumstances of the tenants at that time as, let's say, compared with after the land reform which should be of some interest.
Anyway, after that the war was over and I could get a visa, I went to England. In England I went to a tutorial school to prepare myself to take my A level exams and enter London University. I had a great tutor. He was an Austrian. He taught me about Marx for the first time, at a very early age. I learned a bit about Marx. And he used to take me to Hampstead Heath and sit on the top of the hill looking down at London. He used to say, "You know, this is where Marx used to sit and contemplate this dark, abysmal urban center and he considered it to be a wonderful place to see the working of the capitalistic society." And he used to beat it into my head that this is where Marx observed the working or the dynamics of the capitalistic society. It's true. Again later on I learned that Marx didn't know much and didn't care much about the agrarian society, the agrarian problem, rural problem -- again I hope I'll have a chance to talk about this as we go along.
In my exams I did rather well in economics and very poorly in English and mathematics. In the second year of high school in Beirut, I was probably the top student in the class in mathematics. But somehow, in the third and fourth year I fell behind in mathematics, probably because my math teacher in the latter years was nowhere near as exciting and dynamic as the second-year teacher. The second-year teacher was very exciting. English was understandable. At that time all the veterans were coming back to school, so the competition was very stiff for London University, Oxford, and other British universities for that matter. I remember when I looked at the English examination, I was really totally appalled by my lack of knowledge and lack of reach to the subject matter. I could speak English at that time. At the American University of Beirut our subjects were all taught in English. I had also studied English literature at some length and with some care because of my love for that subject; but in the examination which included interpretation, analysis of difficult passages from the writers, etc., I did miserably.
After my unsuccessful attempt at entering British universities, I began to think of leaving England for the U.S. One should also remember that London in the years following the war, 1946 and '47, was dark and dismal. You could hardly get a decent meal and we were spoiled by better standards. Everything was rationed. As it were, once in awhile my sister, who was the ambassador at that time, used to ask us over to give us a meal once a week so that at least we got some decent food in our belly occasionally. But generally speaking we lived on starch, potatoes, bread and so on. Very little protein.
I had at that time several brothers and sisters in the United States. I don't know whether I said this or not, but by the way when my father died he was survived by twenty sons and twelve daughters. So when I talk about my brothers and sisters well -- I know you are aware, but perhaps for the record I should say this -- there were all together thirty-two of us when he died. They were dispersed all over the world and in America already I had some of them in my generation, you know brothers and sisters who were generally in the same age group. And I wrote to one of them who was going to Stanford, this is Hafez who is now a professor at Texas University, in Austin.
I asked him to register me at Stanford and send me the proper papers for visa and so on. But the letter reached him during summer vacation. At that time he was chasing a girl in Greeley, Colorado -- a small college, a lovely place -- where the father of the girl he was chasing was a full professor at the time and he had just gone with her to visit and stay for the summer. He received my letter there and he just proceeded to register me there at this little college which was called the Colorado School of Education. It was a teachers training college actually, with a liberal arts program -- a B.A. program. So I went there.
But on my way, I remember, I stopped -- on my way that is after I crossed the Atlantic -- I stopped in New York then I came up to Boston because I wanted to see if I can go to Harvard since I had heard a great deal about it. I went straight to a place which was called the "Littauer Center for Public Administration" and I asked who was in charge, I remember, and they told me there was a man called Edward S. Mason, who is the dean and I should go see him. Finally I was ushered into a big room where I saw a big man sitting behind a big desk looking at me from behind his glasses. I'm sure he was amused by my very presence at that time. He asked me about my background and I explained to him that I wanted to come to Harvard. He said that, "You know you are already late, this is mid-September. You should have applied earlier. However, since you have already gotten an acceptance at this little college, I think that is fortuitous and you ought to go there, because that will familiarize you with the way we do things in this country and that slowly introduces you into our culture, into our civilization, the way of doing things. Later on you can apply to Harvard and come back to Harvard." I said fine and I proceeded to catch the train from New York to travel across the U.S. to Greeley, Colorado. I must tell you an anecdote, which is a part of my bringing up in the United States, part of my experience in the U.S. which happened on that train. You must remember at that time I was relatively young - nineteen and inexperienced.
Q. What year was this?
A. This is September of 1947, I'm talking about. And a boy who hadn't seen much of the world, pampered and, I supposed, spoiled. I caught this train to go west to Colorado. The language I could speak, that was a great advantage, I suppose. Anyway, I was sitting on this train and I thought I had a great deal of money with me. I had something like a thousand British pounds, which was a considerable amount of funds for me to have at that time. Because that is what I needed to pay the tuition, to get started, and to last in the school for nearly a year. I had bought the ticket in New York, but I never thought about having enough U.S. dollars for my meals I would have to pay for from New York to Denver.
After a day on the train, I noticed that I had no more U.S. dollars to pay for my food and I became very concerned about it. I approached the gentleman sitting next to me in the club car and I struck up a conversation with him. I was very polite. I found out that he was a salesman -- he sold, if I remember correctly, laundry machines. He was going to Chicago, and we were going to arrive there on Sunday. Earlier, when I had presented my travelers checks which were in pounds in the train, nobody would accept them as payment. They said you have to go to a bank in Chicago. And we'd be arriving on a Sunday in Chicago and I knew that by the time I get to Denver I'd be starving. So I talked of this problem to the gentleman who was sitting next to me and I showed him my travelers checks. After listening to my predicament and inspecting the checks, he just put his hand in his pocket, and gave me two twenty-dollar bills, which was a considerable amount of money in those days for a man to give to another whom he didn't know at all -- at that a very young fellow who after all had not seen much of the world and could not have been trusted to be, perhaps, a man of his word. And he said, "When you get to school, send me back this money." I was pleasantly shocked, of course, and you must know that when I arrived at the school, the first thing I did, I exchanged some money at the local bank and I mailed two $20 bills with a long letter of thanks to this kind man to his Chicago address. You know that taught me something about Americans -- their openness, their trust and helpfulness. I saw that type of behavior many more times later.
Anyway, I stayed in Greeley, Colorado. I did rather well. To be very honest with you, I was doing extremely well without even going to classes. I found that things were rather elementary for me in several subjects, certainly in economics that I was taking. And soon enough I was able to do other things by just studying two or three nights before the examination and I would still end up with a "C" or a "B". I made no effort, but I was discovering American life and I was so excited. On campus, everybody knew me.
Another interesting story is that when I first entered the college at Greeley, I was told that the first night was the night for students to organize themselves in terms of fraternities and sororities and independent associations. So being what I was, I chose to go to the independent student association gathering. Perhaps I just liked the word "independent," you know. It was very important to me. And I sat right in the front, I was very proud. I wasn't shy at all, I sat right in the front and there must have been, I don't exaggerate, five hundred students in that hall. And so somebody came -- a third- or fourth-year student or a young teacher maybe, I forget who he was -- and the first thing he said was, "All right, one by one introduce yourself." So each person stood up and introduced himself or herself and soon my turn came. I was in the first row and I decided to, you know, sort of make my mark there and then. I got up and said -- and I used my middle names, which are never used really, in Persia, we don't have middle names in the sense that you find here. But I sort of wanted to leave an impact -- so I got up and said, "My name is Khodadad Abdol Hossein Firouz Farmanfarmaian." You must remember Abdol Hossein was my father's name and Firouz is my grandfather's name and I used them both. Once I said this the whole room went into an uproar and somebody in the background screamed, "Why don't we just call him Joe?" And that, believe it or not, that name stuck to me for a long time.
From there on, literally more than half of the student body at the school -- there were only about 2,000 students at that college -- knew me as "Joe" which helped to become very popular. As a result, I was able to become a member of what was otherwise a very closed type of community to which I would not have had such an easy admission. But this business of just "Joe" helped me and everybody knew me as "Joe" until the day I left that college, and all my friends continued to refer to me as "Joe" long after.
I met Joanna there, which is perhaps one of the greatest experiences of my life. This is thirty-four years later and I'm still married to her. We have three children and four grandchildren. Oh, I dated several people before I met Joanna. But you know, I was still a stranger to them, I was a foreigner. Don't forget, Greeley was a farming community and probably most of the people did not even know where Iran was located. They must have thought of me as a "Mexican wetback." After all I was dark, dark-haired and so on. I was strange to them. Moreover, I was rather cavalier in my behavior and I sported around in big cars, a Lincoln Continental at that time, which made them more suspicious of me.
I used to take girls out and after weeks of having courted them, I'd still end up at the end of the night kissing them on the cheek, you know, and not one step further. The first girl that treated me like a normal acceptable human male was Joanna. And I think it took four or five weeks before we got married. Before we were married, however, I left her to go to Stanford because by that time my application had been approved and I felt this college was too small for me and I wanted to go to another university with higher standards, more fame. As you know, names meant so much to us in those days. I said goodbye to Joanna and left. But I couldn't stay in Stanford, I missed her so much. I returned and we were promptly married.
Q. Is this during the academic year?
A. No, during the summer of 1949.
We were married by a judge. Nobody on her side of the family was present at the civil ceremony. The only one who was present from my side of the family was Cyrous, my younger brother, who signed my marriage certificate and the court clerk served as the second witness. After a brief honeymoon in Chicago -- which turned out to be an unhappy occasion for Joanna because of my preference to have my sister and brother present at all the festive occasions and I spent little time alone with her -- we returned to Greeley and I left her there to go to Palo Alto to make arrangements for an apartment. She stayed with her parents. And I went to Stanford where I was assigned a single room in an old army barrack which served as student housing.
At this time I was around twenty or so and the pressure of the heavy academic requirements of Stanford -- the long reading lists of the various courses -- and the fact that I had a wife who was pregnant put me under great pressure. Slowly, the whole thing began to sink in that, my God, for the first time I felt I had such responsibilities and I was facing a big change in my life. Suddenly, I'm married, a child is expected, and I'm facing all these hard studies that I have to carry out.
A few days after I arrived, I was sleeping in this miserable room in the barracks and I was awakened by a severe abdominal pain. I did not know many people and I'd met some Persians and I hardly knew their names. There were only three or four Persians at Stanford. One of them happened to be living in the same dormitory near to me, so in the small hours of the morning I stumbled towards his room and banged at his door. The poor man was sound asleep. He opened the door looking rather disturbed and asked me what I wanted. I said, "I have this great pain and I don't know what to do about it." He said, "You just come and lie down on my bed, I'm going to go call the doctor." And so he went to the phone and called the doctor. The doctor came immediately, examined me and gave me a whole lot of pills to swallow. The rest of the night I slept on his bed. You know who this man was? This was Reza Moghadam who became my closest friend and remains so, and we became such close colleagues later on during our service in the government of Iran.
Well, Stanford was a very exciting place -- my first child, Tanya, was born there, I received my B.A., M.A., and I did a year of Ph.D. work in economics before I left to look for a job because no foreign exchange was forthcoming from Iran during the late Mossadegh's years. This was in 1952. My memories of Stanford revolve around individuals who were great men, great names, who will remain in my mind forever.
The nicest probably, the most sympathetic teacher to me was an old man (who taught us taxation and public finance) called Elmer Fagen. I did extremely well in his courses. He appointed me as his assistant on fiscal policy. Another great name that is known throughout the world was Edward Stone Shaw who taught monetary theory. Still another great name who was one of the most outstanding and interesting and best Marxists in those years was Paul Barran, who liked me very much and often accused me of playing around too much with girls because apparently I didn't do as much reading as he wanted me to and did not satisfy his expectations of me. He had a great sense of humor, a thick Polish accent, and was a sloppy dresser but endowed with a searching and brilliant mind. In any case, I usually did extremely well in his courses also.
Professor Tihoe Skitovsky who in micro and welfare economics, had already established a great name for himself among world economists; and at the time we were at Stanford his famous book on welfare economics was published. Professor Kenneth Arrow, who subsequently became a Nobel prize winner, Professor Abramovitz who was in business cycles, Professor Reader who had done already great contributions in marginalism -- all made for a great department at a great university, which provided me with a rare valuable academic experience never to be forgotten. I principally owe my intellectual training and whatever knowledge of the fundamentals of economics that I have to those years at Stanford.
But Stanford had other aspects also. We couldn't get money from Iran and Joanna had to get a job with the Stanford Research Institute, which was at that time an incipient institution and had just started. She was doing very well because she received a salary which was three times the amount of money that I would receive on a monthly basis from Iran. We lived in the barracks for married students. When Joanna was working and I was going to school Tanya, our fourteen-month old daughter had to be left in a day nursery for working parents; and frankly, neither one of us particularly liked that aspect of our family life.
Anyway, when I received my masters in 1952 and had taken several courses for Ph.D., I began to think in terms of a job somewhere. I took a bus to go around the United States looking for a job. I went to the World Bank, I went to the United Nations to be interviewed by several people. And on my way back, I stopped at the University of Colorado in Boulder to visit my brother Cyrus. Cyrus was taking physics at the University of Colorado. While there I went to the Department of Economics and talked to the chairman and some of the professors and told them that I only have a few more courses to take for my Ph.D. and I need financial support, could I have a job while I finish my residency requirements there? Could I have any job, research, part-time teaching job, whatever was available. After looking at my record, they informed me that they would give me a job, as well as a scholarship to cover the cost of tuition at the university.
There I became a research and teaching assistant and taught a course at the Extension Service of the University of Colorado -- at the time this meant I would travel from Boulder, Colorado to Colorado Springs twice a week to teach the Air Force Academy cadets. You Know the Air Force Academy now is in Colorado Springs, with its well-known campus and buildings designed by the late Frank Lloyd Wright.
I completed my Ph.D. requirements, and I did extremely well. I produced some good pieces of research, especially on a problem of much interest now, but at that time it didn't seem too highly significant. But the professor who was doing it really had a great vision, Professor Morris Garnsey, who was among the early crop of regional and resources economists trained at Harvard. He was doing work on oil shale at that time and he believed the future of the mountain states was to a great extent connected with the oil shale. He had based this on the simple assumption that the U.S. was fast running out of its own oil resources and the U.S. would have to turn to other fuel possibilities and one of these was oil shale. So I did produce a set of preliminary papers on that for the twelve mountain states which was published as a part of his work at a later date.
When I completed my course work and Ph.D. exams successfully, once again, I started looking for a job and I asked Prof. Garnsey to help me. At that time, one of his friends, who was the chairman of the Department of Economics at Brown University, had indicated to him that Brown was looking for a young instructor in economics, had a budget for a young instructor and Prof. Garnsey recommended me for the job. I went for an interview with the chairman, if I'm not mistaken, to someplace in North Dakota. The interview was very informal and took place during a baseball game and I was promptly hired. To this day I do not know whether it was my knowledge of economics or baseball that did it. So in the fall of 1953, I went to Brown University as instructor in economics. I stayed at Brown for two years and in summers I used to go back to the University of Colorado as visiting lecturer. I taught simply intermediate economics, principles of economics, and international trade. And I loved it.
Then I learned about the Harvard Center for Middle Eastern Studies just being opened up at that time. So I wrote to Harvard and said that I want to become a university fellow at the center. I interviewed them. Professor Sir Hamilton Gibb had not yet arrived, but Dick Frye was there. At the time the Harvard Faculty Committee in charge of the center was composed of Prof. Edward Mason, William Langer, Milton Katz and in my case, Prof. Vassily Leontiev also attended. But of course Gibb was later added to it. Anyway the center was operated under the general direction of the Dean of the School of Government, which included economics, politics, and government administration. At the time, Prof. Edward Mason was the dean.
Harvard appointed me as a University Fellow contingent on the completion of my Ph.D. thesis. I hadn't written my Ph.D. dissertation yet. I had fooled around for two years and hadn't finished it. I had finished my course work and final Ph.D. examinations in '53. I just had spent my time reading without direction and focus. I knew I wanted to do something on oil and the question of interdependence of the oil industry with the rest of the Iranian economy, which was always of some interest to me. Belatedly, I had discovered that Leontiev had designed an input-output matrix or system which could be used for my purpose and was deeply enamored of it. I wanted to see if I can use that as a basis to measure or at least talk about the interrelationship of the oil industry to the rest of the Iranian economy. And that brought me close to Professor Leontiev at Harvard.
Unfortunately, my mathematical training had ended in high school and I had to have help. I remember there was a young econometrician here at the time by the name of Dick Caves, who became subsequently a professor at Berkeley and I think he is now back here as a professor. He was very good in mathematics. He helped me a great deal and checked the consistency of my mathematical designs, but God knows we didn't have enough information and statistics from Iran to build up the matrix of inter-industry coefficients for the use of Leontiev's system.
Anyway, in that summer of '55 I came to Harvard and was given a room at No.16 Dunster Street, where the Center for Middle Eastern Studies was located and set out to finish my dissertation. The man who witnessed all of this, more than anyone else, was Firouz Kazemzadeh who was there also on the same basis as myself but in history as a fellow at the center. There was this room they had given us, there was a big table. Firouz used to sit on one side of it and I used to sit on the other side, writing away and asking Firouz about the spelling of words, structure of sentences, and points of fact.
You will never believe that I did it in six weeks, that is, the whole first draft of my dissertation. And of course you will believe, perhaps for good reason, that I haven't read it since the final draft was approved. It was on the subject of the interrelationship between the oil industry and the Iranian economy. My contention was very simple, that the distribution of gains between the investor, which was the foreign investor, or Great Britain and the host country, which was Iran, was inequitable and heavily favored the foreign investor. That in itself was not very difficult to sustain, But my contention went further, that the oil industry partly by its nature and partly because of the deliberate policy of the investor was an insulated industry, and consequently didn't have much of a forward and backward linkage, or secondary and tertiary effects on the rest of the Iranian economy. Thus the benefits of the external economics, pecuniary or non-pecuniary, from the oil industry to the rest of the Iranian economy were grossly overstated. I contended that in fact the oil industry was was little more than an outpost of the British economy. All of this I could sustain. Where I failed was to quantify some of these relationships to be used in the Leontiev input-output model.
Anyway at Harvard we had a great time and after my Ph.D. dissertation was accepted and a degree granted, I wrote and asked Prof. Leontiev to arrange a grant for me to go to Iran to look into the subject of my dissertation deeper to see if I can develop a simple matrix with ten or eleven for Iran. You know, agriculture, industry -- perhaps industry divided into two or three sub-sectors, including oil industry -- services sector, international sector -- imports and exports -- and so on. He did arrange for a grant and I went to Iran. I took Joanna along. That was my first visit after nearly eleven years, 1956.
I went around Iran, talked at length to oil people, tried to collect the data from the Ministry of Industries and Mines. They really didn't have anything. The oil industry had a lot but they wouldn't give it to me and this is true. They only gave cocktail parties for me. Later on, in fact, I faced this once again when I was a high-ranking officer in the government of Iran. I still couldn't get the data that I wanted from them to build up a simple inter-sectoral matrix for Iran, to show quantitatively the relationship between the oil industry and the rest of the Iranian economy.
I returned to Harvard. So the two academic years, '55-'57, I stayed here. I wrote an article which was published in the CExplorations in Entrepreneurial HistoryD, which was at the time edited by Carl Kaysen who had taken over from Professor Cole, a great name at Harvard, a historian. The article was titled "Social Change and Economic Behavior in Iran," which was small but interesting, based on observations of that recent trip to Iran.
Next year I was approached by Prof. Cuyler Young, the Chairman of Near Eastern Studies at Princeton, who offered me a joint appointment with the Department of Economics as a lecturer, and a considerably higher salary than what I was receiving at Harvard. I was told that during the first two years I'd be called lecturer, but after that I could expect to be appointed as tenured associate professor and, I suppose, later on a professor. After interviews and written confirmation, I accepted the offer, left Harvard and started at Princeton the fall of 1957.
It was a place I enjoyed very much indeed but when I was in Iran in the summer of 1957, I had already met a man about whom I had heard much already. He had talked to me about the possibilities of going back to Iran to head a very important office in the Plan Organization of Iran. The man was Abdol Hassan Ebtehaj who became one of the central figures in my life after I first met him. Of course I told him of my problem of having just entered Princeton, and being under contract with Princeton and that I felt I did not want to break that contract unilaterally. It was better if the university approached me and talked to me about it, I would not directly ask the university to release me. He said, "Don't worry about those aspects, I'll fix everything." And secondly, of course, I raised the question of conditions of work with him, which I'll tell you when I come to it.
Anyway I returned to Princeton and I loved it. I remember that by that time we had a second daughter and we lived again in old army barracks, but still maintained rather well by the Princeton administration for faculty housing. They gave us a lovely unit, extremely cheap and the salary they were paying me more than amply covered my cost of living. I was quite happy. I taught at Princeton one course in principles of economics, one course in international trade and one seminar on Middle Eastern economic problems. They were a bunch of very good students and I really enjoyed them very much. I discovered that I myself was learning a great deal while I was teaching those courses. Didn't have much of a chance to do much research in terms of publication because the teaching load that first semester in Princeton claimed all my time.
When I arrived in Iran it was March, March of 1958. Now of course what went in between is an extremely interesting story, which is the beginning of the story of my connection with the Iranian government. One day a man called Robert Goheen who, when I first went to Princeton was still assistant professor but shortly after became the president of the university at a very young age -- and the announcement had made great news because he was so young and he was only an assistant professor of classics when he became the president of Princeton. I'd seen him once or twice during faculty coffee gatherings. Anyway, he was already the president of Princeton when he called me. He told me, "Look, it's up to you. I don't mind it, if you want to go back to Iran. But, basically, it's up to you to decide if you do want to give up this career and go to Iran." He also added that, "I should be more than happy to keep the job open for at least a year after you go so in case you want to go on a trial basis and you want to return to Princeton, your job will be kept open for around a year." I thought this was really a very decent and kind attitude. So I let it be known to Ebtehaj that I would gladly return to Iran and serve in the Plan Organization as what I was then called, the acting chief of the Economic Bureau of the Plan Organization.
Now the beginning of Economic Bureau is a separate story.
Q. You can start with how you met Mr. Ebtehaj.
A. Well, the first time I met Mr. Ebtehaj was in Tehran when I was doing research for Harvard and then later in the summer of 1957.
Q. How were you introduced? What were the circumstances of the meeting?
A. Before the summer of 1957, Mr. Ebtehaj was already in Washington and had somehow asked someone to contact me or he called me himself, I forget now. He wanted to see me. I went to the Hay Adams Hotel in Washington and I had a meeting with him there. There was a gathering of Iranian students to listen to him talk about the second development plan in New York that I presided over and I introduced Mr. Ebtehaj to the student body there. And this was our sort of contact together. Following that I went to Tehran in '57 to meet Mr. Ebtehaj and talk about his offer and of a new job for me.
Q. In his office?
A. We met once or twice in his office, once at a private dinner -- just he and I and his wife -- and another time at a party which he was giving for Ken Iverson, who was at the time representative of the Ford Foundation in the Middle East and Iran. During these times he introduced me to several people as the person he had in mind to start the Economic Bureau. I had not yet accepted and he had not yet formally offered the job to me at that time, because I didn't know the conditions. Then he mentioned that he would give me a home, he would give me a car, he would give me a substantial salary. But he also indicated this problem of salary differential which was a big problem. After all, this was a government agency and if he arranged even to pay me a much higher salary than the usual head of an existing department or chief of a bureau, he would have had a great deal of difficulty. A problem which was subsequently solved, not without inconsiderable unhappy consequences, about which of course I've written quite a bit and it was an important question to the administration of Plan Organization.
Well, later on when I was in Princeton, I simply received Pres. Goheen's telephone call. By the way, Mr. Ebtehaj had been through the White House with a man called Richfield, who was at that time an assistant to Pres. Eisenhower, who knew Mr. Ebtehaj well. And it was Richfield, or someone anyway from the White House that had called Bob Goheen and told him the story, and on that basis Goheen had called me and told me that it was perfectly all right with the university if I wanted to go, that they would keep my job open for me. In between I received a cable from Mr. Ebtehaj saying, what do I think of Pittsburgh University providing an advisory group for economic planning to the Plan Organization of Iran? To which I had a normal reaction, I guess, I said: Without trying to underestimate Pittsburgh University -- which was a very good institution, although I don't believe at the same level as Harvard or Princeton, that it's probably more advisable to approach institutions such as Princeton and Harvard -- for the very good reason that I was familiar with these institutions. I was familiar with the faculty of these institutions. I didn't know anyone at Pittsburgh, to know really if they had the capability of providing the type of top-level advisory people that Iran needed or the Plan Organization required.