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As 5,000 striking teachers menacingly massed in front of the Parliament building in Teheran fortnight ago, the Shah personally cautioned his tough police to proceed gently. "One martyred student or teacher is all the Communists require to start a revolution," he said gloomily--a tacit admission of the explosive state of his nation. But in the scuffling down on Parliament square a police major lost his head, pulled his revolver, killed one teacher and wounded three others. There was no revolution. Yet students and teachers rioted bloodily in Teheran, fought hand-to-hand skirmishes with police, paraded the dead man's coffin through the streets, and forced the resignation of Premier Jaffar Sharif-Imami. The Shah hastily installed a new Premier with orders to take drastic measures.

The new man was Ali Amini, 53, a wealthy, French-educated (University of Grenoble) landowner with liberal political views who privately believes that Iran's 200,000-man army is too costly, its Development Plan too small, and the Shah too deeply involved in politics for his own good. After taking stock, Amini made a sobering report to the nation. "There is no life left in the economic and financial agencies of the government," he declared. To the striking teachers, he confessed: "The treasury is empty, and the nation faces a crisis--I dare not speak more openly lest I create a panic." Then he went to the Shah, had Parliament dissolved, and got power to rule by decree. Teheranis demonstrated joyously and danced in the streets.

The Curse. Trouble with Iran is that though it has a $280 million income in oil revenues, its army (larger than the armies of either West Germany or Japan) and its vast police force gobble up $200 million a year, the Development Plan $150 million more. Prices are rising at the alarming clip of 10% yearly, and a pound of meat in Teheran was a staggering $1.15. Wages have not kept pace; the striking teachers on the average earned scarcely $25 a month. Then there is, as always, widespread graft and corruption which Amini frankly called "the curse of Iran."

The Shah seems aware that something must be done. In the wake of two elections so blatantly rigged that he was forced to cancel them, he fired three key men of his immediate entourage. One of the first to go was Secret Police Chief General Teymour Bakhtiar, 48, who had built himself an ostentatious mansion near the Shah's own palace. Then there was General Ali Kia, 53, chief of army intelligence, who built a block of luxury apartments that Teheranis had taken to calling the Where-Did-You-Get-It-From Building. Purged also was Minister of the Interior General Alevi Moghadan, 57; last week eight Majlis Deputies broke all the windows of his home in their rage over the fact that after they had paid the customary fee to General Moghadan to win election, Parliament had been dissolved before they had a chance to recoup their investment.

Gone Girls. Premier Amini moved briskly, ordered prices of onions, a staple of the Iranian diet, cut from 20-c- to 5-c- a pound, meat to 70-c-. He gave the striking teachers a raise, vowed to prosecute all the grafters in government "and with the money derived from such prosecutions to solve some of our problems." As a start, he clapped Generals Ali Kia and Alevi Moghadan in jail. Also rounded up were three other generals who had political office, among them General Ruhullan Novisi, who as Director of Fisheries had charge of the government's lucrative monopoly of caviar exports. Amini also promised a regime of austerity, made a start by announcing he will oust 1,000 foreign cabaret girls who entertain Iran's richer politicians and grafters in Teheran's nightclubs.

More importantly, he ordered plans for a sweeping land reform to benefit Iran's 16 million woefully poor peasants and to end a state of affairs summed up in the tale of two landowners who sit down to a game of chess. When one of them asks what the stakes are, the other replies laconically: "Villages."

For both the Shah and Amini had noted that in his recent chat with U.S. Columnist Walter Lippmann, Nikita Khrushchev had happily listed Laos and Cuba as the latest examples of countries where revolutionary movements were triumphing.

Next on the list, added Khrushchev, was Iran.

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