Attacking an embassy and taking diplomatic staff hostage is an act of war by definition, and we pretty much blew that shit off because (a) President Carter was an incompetent pussy, and (b) he still felt terribly guilty about the US role in helping our British allies put Iranian Prime Minister Mossadeq out of a job in 1953.
Mossadeq got in the British crosshairs by nationalizing the assets of the Anglo-Persian Oil Company (the forerunner of British Petroleum), the company that discovered Iranian oil fields, built the refineries, and commercialized production. Nationalization — well, expropriation, really — is a very popular tool in the communist toolbox, and commies weren't particularly well-regarded by democracies in the early '50s. Mossadeq was basically his era's Hugo Chavez, popular among the working poor, and a folk hero for humiliating the vile imperialist running dogs who had the temerity to profit from the very industries they discovered, created, and built.
Q: Why accept a 50/50 profit split when you can steal the industry outright and take 100%?
A: Because the previous owners tend to take that personally.
That answer came as a huge surprise to Iranians. Look, I'm not saying the British company invariably comported itself fairly and honorably, but I am saying that if Iran's principal bitch is that they're not getting a fair deal compared to the one the US gave the Saudis, when they did finally get that offer, they shoulda taken it. You don't just steal shit and expect the everybody to be cool with that because your homies think you're the shizz.
Among the politically "edgy," it's considered prima facie evidence of American hypocrisy to point out that Mossadeq was elected democratically, as if his rise to power applies a permagloss of democracy to all his subsequent acts. They casually ignore the fact that once in power Mossadeq used his popularity to force the legislature to grant him dictatorial powers, which he then used to dissolve the legislature. [I'll resist the urge to self-Godwin here.]
So anyway, Iran still holds a grudge against the US over our role in assisting the British trashing of anti-Western Iranian folk-hero Mohammed Mossadeq going back to 1953, and we have since officially apologized for our part. Iran, however, never apologized for committing an act of war against the US in 1979, so...I guess I'm still holding a grudge.
The '79 Revolution was a revolt against the Shah, who the clergy regarded as progressive and pro-Western. They were right. The Shah, while hardly a leader beyond reproach, nonetheless modernized Iran through his "White Revolution" by promoting women's rights including the vote and allowing women and non-Moslems to hold office, reducing the political influence of the Islamic clergy and increased the secularization of the government, he de-feudalized agriculture with massive land reform, de-nationalized some industries and established worker's profit-sharing, was the first Moslem leader to recognize Israel, and he preferred the US over the Soviet Union during the Cold War. His policies dramatically improved the people's standard of living, healthcare, and education. This is all good, although naturally not all progress was without incident. However, as the Shah aged, he became more autocratic.
Still, he was nowhere near as autocratic as his replacement, Ayatollah Khomeini, who not coincidentally got his first taste of fame opposing the White Revolution reforms. In fact, I can't think of a more autocratic position than Khomeini's famous proclamations, "I appoint the government," which he called "God's own government" defiance being tantamount to "a revolt against God." He cautioned dissidents, "I repeat for the last time: abstain from holding meetings, from blathering, from holding protests — otherwise, I will break your teeth." Lovely. This asshole was regarded as the messiah — the promised Madhi, and he took the title Imam, placing himself among a tiny constellation of morally infallible Islamic legends.
Khomeini extended the principle of wilayah faqih (clergy's legal guardianship over the legally incompetent, such as orphaned children and the insane) to make every Iranian the legal ward of the clergy, [and here's the important part:] displacing the traditional role of secular leadership entirely.
That's totally weird and unprecedented in Persia's estimably lengthy history — but hey, Iranians officially replaced their progressive constitutional monarchy with Khomeini's retrograde brand of theocracy by a vote of 98% in favor.
Now they're having buyer's remorse? I don't think so.
Mousavi is neither a reformer nor an outsider. He stands for everything we hate. He speaks of the '79 hostage crisis with approval. He called Israel a "cancerous tumor" and refuses to recognize its right to exist. He endorses the Khomeini's fatwa against author Salman Rushdie and in his capacity as prime minister, Mousavi formally severed Iran's ties with the UK for their refusal to surrender Mr. Rushdie to Iranian prosecution and certain death. Also as prime minister, Mousavi was involved in the purchase of nuclear centrifuges from AQ Khan's Islamic Bomb Mart that enrich uranium for the Iranian nuclear weapons program. Mousavi has promised not to suspend uranium enrichment. He was appointed by Khomeini to the leadership council of Hizb'allah — probably the world's most dangerous terrorist group — at it's formation. He called for a return to "Khomeini's fundamental values" because he genuinely admires Khomeini, his political patron. Et cetera.
So I look at what's going on in Iran and I think...meh.
Given Iran's longstanding penchant for blaming my country, "the Great Satan," for every self-inflicted wound, they hardly deserve more. Anyway, whichever mullah-picked candidate wins the election, he won't alter Iranian foreign or domestic policy precisely because in Iran there is no actual role for secular leadership. Why get your head cracked in over a farce? When Iranians figure out that their problem isn't America, or Ahmadinejad, but is their fucked up theocracy, I'm sure I'll regard things differently. However, their current rallying chant of Allah O Akbar! is the slogan of the '79 Revolution, and green is the color of Islam.
That hardly indicates they've actually cracked that code.