Foreign Relations of the United States, 1952–1954, The Near and Middle East, Volume IX, Part 1

320.2 AA/11–2152: Telegram

No. 524
The Acting Secretary of State to the Embassy in Israel¹

confidential
priority

Washington, November 25, 1952—1:26 p.m.

538. Deptel 517² and Embtel 836.³ Fol is summary Byroade–Eban mtg NY Nov 21.

Byroade stated Dept noted trend on part responsible Arab leaders towards more realistic practical approach to Palestine problem. Pointed out refugee resettlement progress in Syria and Jordan and private admission Arab leaders that large scale repatriation impossible. Though US cld not take initiative proclaiming latter doctrine, it wld be helpful if other countries sharing this belief were to take lead in expressing their views. Emphasized inter-relationship refugee problem—repatriation—compensation. Stated wld be helpful if IG wld consider possibility limited repatriation, e.g. admitting 50,000 to 100,000 Arab farmers who cld contribute Israel economy. More especially, it was his opinion time had come for Israel, having accepted principle compensation, elaborate ways means achieving this and announce its plans. Perhaps IG cld place small percentage annual fon exchange budget in special fund pay compensation or service loan used such purpose. Move this nature very likely produce favorable Arab response and might begin movement toward peaceful settlement. Hopeful that such step by IG wld lead relaxation economic blockade, such as Israel’s use Suez Canal for oil shipments with consequent reduced transportation expenses. Such advantages wld probably go far offset cost compensation. Indicated awareness Israel’s econ financial difficulties but felt time had come when Israel must indicate desire and intention take steps resolve impasse with Arabs.

Eban referred Sharett’s 1951 Knesset statement that while Israel considered Arab states responsible plight refugees and required cooperate their absorption, Israel recognized obligation compensate Arabs. Eban described lack Arab response this and other conciliatory gestures and said he had grave misgivings whether any good wld accrue Israel from sort action suggested by Byroade. Arab reiteration fact they and Israel still in technical state war, their refusal talk to Israelis at international mtgs, and increasingly effective blockade and boycott made it hard for Eban believe conciliatory gestures by Israel wld be considered by Arabs as anything more than sign weakness and provoke further hostile measures by Arabs in hope achieving collapse Israel. Eban described strange situation which wld result from Israel release blocked Arab accts, since Israel wld thus be paying money into countries blockading it and interfering with German restitution payments Israel. Eban stated Israel has counterclaims arising from damage and losses from the war, boycott and blockade and inability Jews Near Eastern countries such as Iraq obtain compensation property left behind. While he aware support some quarters theory ltd nr Arabs cld contribute Israel economy, under present conditions they might constitute serious security problem and he did not feel IG at present cld actively consider matter.

Referring IG’s record past cooperation with PCC re compensation, specifically in problem assessing value land relinquished by refugees, which wld continue, Eban said it wld now be appropriate for IG negot with PCC compensation settlement to be implemented through UN.

Byroade pointed out action by IG such as he had suggested might well lead to conciliatory steps by Arabs; if IG were to wait until it was certain of this matter, movement toward settlement wld never occur. Particularly, he did not believe approach through PCC suggested by Eban adequate. He believed Naguib has earnest desire settle Palestine problem as far as Egypt concerned but wld take no step this direction until IG had done something effective about compensation.

Was pointed out IG’s earmarking of money for compensation fund and announcement that fact wld not necessarily commit Israel continue with plan and carry out program if Arab attitude remained hostile. In short, US view is that steps along lines suggested to Eban wld produce easement tension and relaxation boycott and blockade. Only in such conditions cld Israel reasonably be expected pay large sum money involved in compensation. If Arab response turned out different than what US supposed, IG cld reexamine matter and modify policy accordingly.

Eban concluded mtg saying he considerably attracted by proposal set forth by Byroade. He wld communicate immed with IG in endeavor ascertain how far Israel cld commit itself at present time. He hoped he cld make statement at this GA along lines suggested.

Bruce

1. Repeated by pouch to London, Paris, Ankara, Amman, Beirut, Baghdad, Cairo, Damascus, and Jidda.
2. Document 522.
3. Supra.