By 1969 the United States was looking for assistance in carrying out its military commitments in the Third World based, primarily, on Britain’s decision to withdraw military forces from all ports east of the Suez Canal, including the Persian Gulf. (Formal confirmation of the withdrawal occurred on March 1, 1971.)
Washington believed that Britain’s departure would leave a dangerous strategic vacuum in the region and, therefore, expanded allied responsibility, announcing that the US would send arms rather than troops to critical areas.
The Nixon Doctrine, announced in 1969, provided supporters with a new justification to buy arms that would be used in the Western interest, a policy which would also allow American defense contractors to extract huge profits.
Given a green light by the Americans, the shah of Iran began to purchase a range of weapons and support systems that he expected would meet both regional contingencies and support US military objectives.
The shah was basically given military carte blanche based on the perceived American need to have a trusted local power protect US interests in the Persian Gulf. Nixon and Secretary of State Henry Kissinger believed that as America’s foreign surrogate, Iran deserved to receive whatever military goods it deemed necessary to carry out its new responsibilities.
Nixon and Kissinger thought that American and Iranian interests overlapped. In Kissinger’s words:
On all major international issues, the policies of the United States and the policies of Iran have been parallel and therefore mutually reinforcing.
From Kissinger’s perspective the shah was
… that rarest of leaders, an unconditional ally, and one whose understanding of the world situation enhance our own.
Facilitated in the 1970s by ever growing oil revenues, the Iranian government spent more money on US weapons and military support than any other non-European country.
Iran did, however, insist on a quid pro quo, insisting that the US provide covert military assistance to Kurdish rebels. The Kurds were used as proxies, serving Iranian, American, and Israeli interests until 1975 when Iran and Iraq reached an agreement favorable to Iran, moving Iraq’s border from the Iranian shore of the Shatt-al-Arab waterway to the middle of the deepest shipping channel. Iran then cut off aid to the Kurds who were subsequently overwhelmed.
Despite this occurrence, the Iran-Iraq agreement did serve to stabilize the region by encouraging Iraq to move to a more non-aligned position and increasing American opportunities to reestablish influence in the country.