Historical Documents - Office of the Historian

1.

The prolonged and bitter conflict between Israel and the Arab states profoundly influences Israel’s relations with the outside [Page 1276] world and many aspects of its internal situation. The Arab-Israeli dispute has seriously damaged the US security position in the Middle East.

2.

There appears to be no prospect of a full peace settlement between Israel and the Arab states for many years, though certain specific Arab-Israeli problems might be resolved.

3.

In the present highly charged atmosphere, war could break out betweenen Israel and the Arab states as the result of accident. However, an early renewal of hostilities is unlikely as long as there is a near equilibrium of Israeli and Arab military strength and the US, the UK, and France exert a restraining influence on both sides.

4.

Israel fears a build-up of Arab military strength by the Western Powers and will make every effort either to prevent such a build-up or to maintain the present power relationship by obtaining equal aid for Israel.

5.

Israel has sought good relations with both the US and the USSR. It has also sought to gain a bargaining advantage from the East-West struggle. We believe that Israel will probably endeavor to remain neutral in the East-West struggle as long as possible, but is, under present circumstances, more favorably disposed toward the West. In time of war, however, Israel will follow the course that it deems most expedient in the light of the pressures and inducements existing at the time.

6.

Because of Israel’s strategic position and communication facilities, wartime access to Israeli territory is highly desirable for the defense of the Middle East by the Western Powers. However, peacetime arrangements for the use by the West of Israeli territory are unlikely and would almost certainly provoke bitter Arab ill-will.

7.

Israel is now politically stable under a coalition government which is dominated by Israel’s strongest political party, the moderate socialist Mapai. Israel will probably continue to be governed by moderates who will be able to control the country without departing from the established democratic system. Under crisis conditions, however, the government would probably take effective measures to maintain control.

8.

Israel’s economic position is precarious. Israel is not self-supporting economically and even under the most favorable circumstances is unlikely to become so for many years. Israel’s scanty resources are wholly inadequate to provide for the settlement of Jewish immigrants, maintain armed forces capable of defending the country against concerted Arab attack, and support the standard of living to which the government is committed. Israel has given a higher priority to the task of taking in Jewish immigrants [Page 1277] and refugees and to the huge burden of military defense of the state’s existence than to the development of a balanced national economy.

9.

Israel has been and will continue to be heavily dependent on public and private foreign aid. Israel can probably maintain precarious solvency if substantial foreign aid continues to be available. Sharp curtailment of foreign aid would require further downward revision of the investment program and/or downward revision of military preparedness expenditure; failure to make such cuts in expenditure would result in graver financial difficulties and a lowered standard of living. Israel would probably choose a slower rate of development or a lowered standard of living in preference to reduced military security. Renewed mass immigration or outright warfare with the Arab states would require increased funds from foreign sources to prevent economic collapse.

10.

Israel has an importance out of proportion to its size, population, and resources because: (a) it is one of the key factors in the current instability in the Arab states, and (b) it has the political and financial support of the Zionist movement and of many influential groups and persons in the Western nations, particularly the US.

11.

Beginning in the last decade of the nineteenth century, the Zionist movement encouraged Jewish immigration into Palestine with the object of founding a Jewish state. Immigration was stimulated by the intensification of anti-semitism associated with Hitler’s accession to power, and the Jewish population of Palestine grew from about 200,000 in 1932 to about 650,000 in 1948. Persistent efforts by the British Mandate Government and by the UN to reconcile conflicting Jewish and Arab aims failed to stay the increasingly violent conflict between the two groups. A UN plan to partition Palestine between Jews and Arabs was rejected by the Arabs in 1947. The proposed Jewish state of some 900,000 persons would have included about 400,000 Arabs and the proposed Arab state of some 735,000 persons would have included about 10,000 Jews. Immediately after passage of the partition resolution, strife between Jews and Arabs increased throughout the area. Irregular but hard fighting broke out in December 1947, and by May 1948 a few hundred thousand Arabs had been driven from their homes. The British Government gave notice that it would terminate the Mandate on 15 May 1948; the Mandate under which Palestine had been ruled since 1923 came to an end at midnight on 14 May 1948; and the situation was left to the UN and to the conflicting parties. Immediately following the withdrawal of the British, Jewish leaders [Page 1278] proclaimed the new state of Israel, and the armies of the surrounding Arab countries entered Palestine for the avowed purpose of helping the Arab population and bringing about the fall of Israel.

12.

Conflicts of national and personal interest and policy disorganized the efforts of the Arab states, and their armies proved inferior to the skillful and determined Israeli forces. The decisive military defeat of the Arab effort led to the signing of armistice agreements between Israel and the Arab states of Egypt, Syria, Jordan, and Lebanon between February and July 1949. Armistice lines were agreed to on the basis of troop dispositions at the end of hostilities. Israel accordingly retained about 30 percent more territory than was allotted to it in the UN Partition Plan of 1947, including most of the New City of Jerusalem and a wide corridor leading to it. A large segment of central Palestine on the west bank of the Jordan River, including a small but highly strategic part of the New City of Jerusalem and all of the Old City and the Holy Places, went to Jordan. The Arab state provided for by the Partition Plan never came into existence, its territory having been appropriated by Israel and Jordan. The flight of Arab refugees during the period of the civil war and the Arab states-Israeli war which followed the departure of the British reduced the Arab population in what is now Israel from about 1,000,000 to about 175,000. Immigration has since increased the Jewish population of Israel from about 650,000 to almost 1,350,000.

13.

Efforts by the UN and individual states to bring about a peace settlement have been fruitless. The armistice lines between Israel and the four contiguous Arab states are supervised by four Mixed Armistice Commissions under a UN Truce Supervision Organization. The Israeli-Jordanian armistice line is the scene of frequent incidents. UN resolutions in 1948 and 1949 favoring the internationalization of Jerusalem and the right of about 800,000 Palestinian Arab refugees to return to their homes and property or to receive compensation have not been enforced. Israel is involved in a cold war with the Arab states which has a profound influence upon its political and economic life and its relations with other states.

14.

A unique historical experience has produced in Israel a people imbued with a sense of the righteousness of their cause and bitterly hostile to those who oppose them. Their leaders are skilled and ruthless and are not disinclined to use force to gain their ends. Both people and leaders appear convinced that there is a special moral justification for any action that helps Israel. . . .

15.

The people of Israel have come together from many parts of the world but the majority is united by: (a) the ideal of the Jewish homeland and the shared experience of building a new state; (b) widespread acceptance of a European social-democratic political ideology; and (c) a relatively high level of education and political activity. These provide the foundation for a political system on a European democratic model.

16.

The integration of groups of various backgrounds into a national structure still constitutes a problem for Israel, however, and some religious, ethnic, and political minorities are still unassimilated. The greatest single problem of integration is posed by the backward “oriental” Jews who have immigrated from African and Asiatic countries since the Palestine war and now make up about 21 percent of the population.

17.

The government is a parliamentary republican democracy of the Western type which has proved to be basically sound in spite of the tendency of Israel’s numerous political parties frequently to divide and regroup. Israel was able to set up an effective government in May 1948 without delay because institutions inside and outside Palestine had for many years performed many of the functions of government for the Jews of Palestine. Although Israel is, in a sense, an outgrowth of the World Zionist Organization and the Jewish Agency and still depends upon them for financial support, Jewish leaders in Palestine assumed political control of Israel when the state was established and have made it a self-governing state in full control of its own policy.

18.

The greatest concentration of political power is in the moderate socialist Mapai party, which has the advantage of the astute and experienced leadership of Prime Minister David Ben-Gurion and the support of most of the collective agricultural settlements. It also draws strength from its dominant position in the Histadrut, a unique labor organization which not only represents the majority of Israeli laborers but, as the sponsor of numerous collective development enterprises, is also the largest entrepreneur and employer of labor in the country. Mapai, however, has never held a majority of the seats in the unicameral parliament (Knesset) and so has had to resort to coalition government. Mapai has had difficulty in forming a stable coalition with any of the other large political parties. Its secular policies clash with the religious tenets of the United Religious Front; its socialistic economic policies conflict with the conservative economic views of the General Zionist party; and its policies toward the West have in the past been unacceptable to the more radical left-wing Mapam party.

19.

In the most recent general election (July 1951) Mapai won 45 and the General Zionists 20 out of 120 seats in the Parliament. The [Page 1280] present Mapai–General Zionist coalition was formed on 23 December 1952 after the breakup of the Mapai–United Religious Front coalition. Mapai and the General Zionists have had difficulties in reconciling their divergent economic views and their attitudes toward the extreme left. However, they have in general managed to agree on policies of favoring immigration of Jews of European background (while professing to support the principle of unrestricted immigration), of toughness towards the Arabs, and of noninvolvement in East-West issues. No basic change in the political situation in Israel is in prospect, and Mapai will probably continue to be the strongest party.

20.

Israel is the only Middle Eastern state in which the Communist Party is not illegal.* Communist strength has declined in Israel since 1949, and the revival of Soviet anti-Zionism in 1952 and early 1953 has further decreased Communist influence. It is possible that a shift of Soviet tactics, such as abandonment of the anti-Zionist campaign and the renewal of Soviet-Israeli diplomatic relations in July 1953, might regain some of the lost ground, though it is unlikely that Israeli distrust of Soviet policy could quickly be overcome. The Communist Party has an estimated membership of about 4,000, 25 percent of which are Arabs, mostly Christian, and is supported by several “front” groups affiliated with international Communist organizations. It has 5 seats in parliament. The Israeli Communist Party also provides counsel, direction, and propaganda to Communists in Jordan, particularly among Arab refugee groups. Communist strength, like that of other opposition parties, would probably be increased by any serious economic or political crisis which discredited the government or caused widespread privation.

21.

The strength and appeal of other extremist political parties of both the right and the left have decreased since 1951. Left-wing influence may, however, rise again as a result of improved Israeli-Soviet relations. The extreme left-wing Mapam party has some labor support and is still influential in some of the collective settlements. However, Mapam has been split and its strength in parliament reduced from 15 to 11 seats as a result of a conflict over policy toward the Soviet Union. Mapam’s pro-Soviet wing has seceded and formed the Left Socialist party, which has two seats in parliament, but is not expected to exert as great an influence as it did as part of Mapam. The right-wing Herut party, which is the political heir of the terrorists of the Mandate period and expresses a latent popular view in its dedication to Israel’s expansion, has only 8 seats in parliament and is not now politically important.

22.

Military policy is dominated by Prime Minister David Ben-Gurion, who is also Minister of Defense. Military personnel in Israel do not take part in partisan politics, and the armed forces are likely to remain under civilian control. The influence of military considerations on the political and economic life of Israel is, however, considerable because of extreme security consciousness in the country.

23.

Israel is now politically stable and will probably continue to be governed by moderates who will be able to control the country without departing from the established democratic system. In the event of extreme economic or political crisis, however, latent tendencies to violence, which showed themselves in the terrorist activities of the Mandate period and during the Palestine war, might be reasserted. In such an event the government would probably take effective measures to maintain control.

24.

Israel’s economic situation is precarious. Neither the country nor its government has been self-supporting, and despite real progress in the direction of improved production and increased revenues the gap between Israel’s means and Israel’s expenditures remains large. After 5 years of national existence, Israel’s exports pay for only 15 percent of its imports, and the country imports half its food. From the beginning, Israel has depended upon the financial help of the World Zionist Organization and upon other public and private grants and loans. Since 1948, outside aid has totaled more than one billion dollars. Israel has received almost $800 million in grants, loans, and gifts from the US, about two-thirds of which has come from private sources.

25.

Israel has endeavored to move in the direction of greater self-sufficiency with regard to both increased national production and increased government revenues. Despite considerable progress in these directions, major state objectives have received government precedence overriding the attainment of a balanced economy. These overriding objectives are the “ingathering of the exiles” and the security of the State.

a.: Immigrant Settlement. The cost of caring for and settling about 700,000 immigrants since 1948 has caused Israel to neglect and delay the development of its productive facilities. Between 1948 and 1952 about one-third of Israel’s gross national expenditure was invested. A large proportion of this investment went into immigrant settlement projects, but it is estimated that twice as much investment would have been required to integrate the immigrants into the economy. In the past year immigration has fallen off sharply.
b.: Security. The demand for the maintenance of armed forces and equipment capable of defending the country against the combined forces of the Arab states has also been a large drain on Israel’s resources. Israel’s defense costs are currently over 40 percent of the ordinary budget and almost 30 percent of total receipts (including foreign public and private aid) allocated for all purposes, including development.

26.

Certain other factors have contributed to Israel’s failure to raise productivity sufficiently to reduce its dependence upon foreign aid. These factors have to do with national and human resources and with customary living standards, and have a continuing long-range importance with respect to the possible future ability of the Israeli economy to become self-supporting.

a.: Scarcity of Natural Resources. Israel is deficient in native raw materials and energy sources, and Israeli industry is heavily dependent upon imported materials, machinery, and fuel. In 1952, foreign exchange stringency and other causes brought about a raw materials shortage which forced Israeli industry to operate at only 50 percent of capacity. The cultivated area can be substantially increased only through costly irrigation works to fully utilize scarce water resources.
b.: Nature of Labor Force. The skills possessed by the immigrants from European or other industrialized states have not in the main been well suited to the needs of Israel, and for a country so desperately in need of development, an excessive proportion of the working population is engaged in commercial and service work. There is a shortage of technically skilled labor of the kind needed to increase industrial production, and there are not enough scientific technicians presently available or in training to meet the country’s needs. The low productivity of Israeli labor makes it difficult for Israeli industry to compete effectively in the export market. Israeli labor has shown little inclination for agricultural work, except in highly developed areas, and the government has found it extremely difficult to persuade people to work the marginal hill farms formerly tilled by the Arabs. The “oriental” Jews have been almost a dead weight on the economy.
c.: Standard of Living. The European background of most of its population and the socialist labor outlook of its top leadership have led Israel to provide social services and maintain a general level of consumption and a wage scale beyond Israel’s present capacity to support from its own resources. While Israel’s standard of living is austere in comparison with the US, it is far above that of the neighboring Arab states and higher than that of Italy and Yugoslavia.
d.: Reliance on Foreign Aid. The Israeli Government and people assume that world Jewry and the US have an obligation to continue subsidizing them. This attitude has not only reinforced their reluctance to undertake measures of austerity necessary to make Israeli self-supporting at an early date, but has also encouraged an irresponsible accumulation of short-term debts.

27.

The various economic forces thus at work in Israel have produced a strong inflationary trend. This has been slowed down by a series of government measures: (a) credit has been greatly restricted; (b) the government has pledged itself not to issue more land bonds or treasury bills; (c) subsidies on consumption goods have been removed or reduced; and (d) some surplus purchasing power has been siphoned off by a variety of administrative devices. On the other hand, these measures have contributed to increased unemployment and the slowing down of privately financed economic expansion. The government has completed an agreement with West Germany for the payment of about $750 million over the next 12 years in German goods as reparation for Nazi damages against Jewry. This agreement will bring some improvement in Israel’s difficult foreign exchange position.

28.

While it has been assumed by both Israelis and Arabs that the Arab boycott and blockade constitutes an important obstacle to Israel’s becoming self-supporting, it is unlikely that Arab abandonment of these measures would result in a very significant change in Israel’s economic situation. Even without current Arab economic warfare measures, Israel’s prospects for extensive trade with the Near East would probably be limited. The Arabs can produce many consumer goods more cheaply than Israel, and it is unlikely that Israeli industry can compete in the Arab market with the industries of the US, Europe, and Japan. The principal advantages to Israel that would follow cessation of the Arab boycott and blockade would be to reduce petroleum costs and enable the Haifa refinery to earn some foreign exchange. Israel could also expect lower prices for some imported foods. Thus, while relaxation of the boycott might bring some alleviation of economic difficulties, it would not solve the fundamental problems of the Israeli economy. Only a full peace settlement would bring substantial economic benefits to Israel, by making possible a reduction in defense expenditures.

29.

It is unlikely that even under the most favorable circumstances Israel will become economically self-supporting for many years. The country will probably face successive economic crises like the prospective default on short-term government debts in the autumn of 1953 and spring of 1954. The country’s long-term problems will continue to be low productivity in relation to consumption and development requirements, and the continued imbalance of exports and imports. The government’s economic policies, if maintained, will continue to discourage private foreign investors who see neither chance of profit nor opportunity for secure investment in Israel.

30.

Israel can probably maintain precarious solvency if substantial foreign aid continues to be available. Sharp curtailment of foreign [Page 1284] aid would require further downward revision of the investment program and/or downward revision of military preparedness expenditure; failure to make such cuts in expenditure would result in graver financial difficulties and stronger inflationary trends which would affect the standard of living. Israel, however, regards national survival as its major problem and would be more inclined to accept a slower rate of development or a reduced standard of living than to reduce its military expenditure. Since crisis tends to stimulate outside assistance, Israel might deliberately provoke incidents with its neighbors in order to maintain the flow of funds. Renewed mass immigration or outright warfare with the Arab states would require increased funds from foreign sources to prevent economic collapse.

31.

Scientists and scientific institutions make an important contribution to the development of the Israeli economy and maintain high scientific research standards. Israel has an adequate number of research scientists and teachers, but suffers from a shortage of trained technologists.

32.

The Israeli Army is estimated to number about 50,000. Like the Arab armies, it is equipped with heterogeneous and obsolescent weapons. Israel also has about 145,000 trained reservists. From these, it could probably, in a period of national crisis, augment its organized forces to about 100,000 and provide many irregulars for local defense of cities and rural settlements. It could probably not support an army larger than 60,000 men for more than a few weeks without a substantial increase of outside financial and matériel support. Israel claims a mobilization potential of four infantry divisions, which would be built up from the four existing regional commands, and an armored division. In order to raise such a force, Israel would have to mobilize about one-third of all male Israelis between 15 and 49, with serious effects upon the economy. Futhermore, Israel is probably not capable at the present time of equipping more than three divisions, and those only partially.

33.

The Israeli Air Force has a total personnel strength of about 2,600, including approximately 250 pilots, plus another 1,500 persons assigned to the Air Defense Force and to anti-aircraft artillery units. The Air Force has a heterogeneous collection of about 450 World War II-type aircraft of Western manufacture of which about half are in long-time storage. Less than half of the total are combat types. Fifteen Meteor jet fighters are on order from the UK, of which two have arrived in Israel. The airfield system in Israel is capable of supporting limited combat operations. There are twenty airfields, only one of which is capable of supporting sustained [Page 1285] combat operations by jet aircraft. Four are potential bases for heavy and medium bombers, and seven additional airfields are readily adaptable for jet fighter operations. Significant expansion of the Israeli Air Force would be possible only with outside help.

34.

The Israeli Navy has a personnel strength of about 3,000 and a collection of 30 World War II craft of varied origin, the most important of which are three frigates. Basic seamanship and shiphandling are of a high order, but there is a lack of modern equipment. Israel is at present incapable of significantly expanding and developing its Navy.

35.

The Israeli Army is presently capable of repelling attack by any or all the armies of the Arab states and of maintaining internal security. The Israeli Air Force could carry out its mission of defense against an attack by a coalition of the Arab states and could bomb the Arab capitals. The Israeli Navy could dispose of the Egyptian Navy, which is the only Arab naval force likely to come against it. The Israeli armed forces probably could not win a war of conquest against a coalition of the Arab states, though they could win local tactical advantages if they could attack the Arab armies separately. Quantities of arms, ammunition, and equipment are believed to be more than sufficient for immediate defense purposes, but not for a long war. Outside military and economic aid would be a major factor in determining the outcome of a war between Israel and the Arab states.

36.

Morale in the armed forces is generally good. There are a few Communists in the Israeli armed forces, but they are believed to be under control. Neither members of Mapam nor the survivors of the Irgun and Stern Gang terrorist organizations are believed to have an important influence.

37.

The Israeli Army performs an important function in integrating new immigrants and members of minority groups into the community through the universal military training program, which includes indoctrination in citizenship and hygiene as well as military training.

38.

Israel has a small but expanding munitions industry which produces small arms and ammunition and certain other items. Its current output is equal to or greater than the total output of the Arab states, and its capacity is in excess of Israel’s current needs. Israel has sufficient repair and maintenance facilities to take care of the needs of the army and air force at present operational levels. Israel has expressed an interest in US offshore procurement orders, but the Israeli munitions industry is probably not capable of satisfactorily executing such orders for technical as well as economic reasons.

39.

The prolonged and bitter conflict between Israel and the Arab states profoundly influences Israel’s relations with the outside world and many aspects of its internal situation. Conflict with the Arabs has come to seem a normal factor in Israel’s existence, and in adjusting themselves to this situation the Israelis have come to regard a tough policy toward the Arabs as a practical necessity. The Israelis believe that Israel is theirs by moral right, by right of conquest, and by virtue of the fact that they have retrieved it from centuries of neglect by a backward people. They would like to reduce defense expenditures and to see an end to the Arab boycott and blockade. However, because of intransigeance on both sides, virtually no progress has been made toward a settlement of the three outstanding issues: the Arab refugees, the establishment of permanent borders, and the status of Jerusalem.

40.

To the Arabs, Israel is a creation of “Western Imperialism” and a symbol of Arab defeat and humiliation. It is the favorite grievance of almost all Arabs and a talking point for the most extreme nationalists. The Arab states have refused to discuss a peace settlement with Israel and have supported the Arab League boycott and blockade, hoping to weaken Israel and bring about an eventual increase of Arab strength relative to Israel’s. Some Arab leaders may have begun to believe that compromise with Israel is now their most realistic course of action, but none has been willing to propose it publicly.

41.

Of the three principal Arab-Israeli issues, the disposition of the Arab refugees presents by far the most substantial problem. 800,000–900,000 Palestinian Arabs fled or were driven from their homes in Israel into the surrounding Arab states. Almost all of them are dependent upon rations supplied by the UN, and about one-third occupy camps which are centers of unrest and targets of extremist propaganda ranging from that of the ex-Mufti to that of the Communists. The refugees themselves demand repatriation. Any inclination on their part to accept resettlement in the Arab states has been dissipated by the reactions of the Arab governments and of Arab extremist leaders of the left and right. The Arab states take the position that, in accordance with the UN resolution of December 1948, the refugees should be allowed, should they so desire, to return to their homes and property, or in the alternative to receive compensation from the Israeli Government. Israel is firmly opposed to the principle of repatriation, arguing that a mass return of Arabs would threaten the security of the Jewish state and would disrupt its economy. In this impasse, the burden of supporting the refugees has been almost wholly assumed [Page 1287] by the United Nations. The Arab governments have taken almost no effective steps to resettle the refugees, probably preferring to exploit this issue as a means of influencing international public opinion. Syria and Egypt have signed agreements with the UN on resettlement plans, but nothing has yet been accomplished. It is probable that the vast majority of these refugees will ultimately have to be resettled in the Arab states because of their unsuitability for emigration to non-Arab countries.

42.

A major current problem growing out of the failure to establish permanent borders is that of incidents along the armistice-line borders. Arabs from Jordan, many of them refugees, frequently cross the line to smuggle, steal, or visit their former homes and fields in Israel, and acts of violence frequently result. However, the Israeli policy of “active defense,” pursuit of infiltrators into Jordan territory, and reprisal raids is probably responsible for the majority of serious incidents along the border. Strong representations to Israel and Jordan by the US and UK in May 1953 temporarily improved the situation, but incidents continue to recur. The armistice lines between Israel and Syria, Lebanon, and Egypt have been relatively free of such incidents since: (a) there is a lower concentration of refugees along lines close to their former homes; (b) the lines largely follow previous international boundaries; (c) the length of line and difficulty of terrain is less than in the Jordan-Israeli line. The Arabs now demand a return to the 1947 Partition Plan boundaries, which the Israelis reject as obsolete.

43.

The Israelis have established their capital in the New City of Jerusalem. This violates UN resolutions and is regarded by the Arabs as evidence of Israeli willingness to defy international opinion and of Israeli ability to do so successfully. Though the Jordanians, who presently occupy the Old City and a small but highly strategic part of the New City, would probably accept the present arrangment, officials in all the Arab states insist upon the internationalization of the city.

44.

Both Arabs and Israelis are psychologically capable of taking aggressive action, and in the present highly charged atmosphere, war could break out between them as the result of accident. However, we believe that an early renewal of full-scale hostilities is unlikely because, though Israel is strong enough to defend itself against Arab attack, it probably believes that it could not substantially expand its territory by an aggressive attack on the Arab states. Furthermore, Israel is restrained from aggression against the Arab states by fear of jeopardizing Western, especially US, support and by the possibility that an attack on Jordan might bring into effect the guarantees of the Anglo-Jordanian Treaty of Alliance, and the UK, French, US Tripartite Declaration of May 1950.

45.

The Tripartite Declaration, in which the US, the UK, and France promised to prevent violation of the armistice lines, has probably had a restraining influence on both sides. A reaffirmation of the Declaration might further reduce the possibility of renewed hostilities, but probably only if it were restated so as to provide for specific punitive military action and economic sanctions as guarantees against Israeli or Arab aggression.

46.

There appears to be no prospect of a full peace settlement between Israel and the Arab states for many years. Israel will almost certainly not change its position on the territorial, refugee, and Jerusalem issues. The Arabs will almost certainly refuse a general settlement that does not provide for boundary adjustment, refugee repatriation, and the internationalization of Jerusalem. They feel that the UN resolutions support their position on these issues, and that ultimately Israel will be forced to accept terms favorable to the Arabs. Furthermore, the Arabs will be reluctant to enter into normal relations with the state of Israel because they fear Israeli economic penetration and political intrigue.

47.

It is, however, possible that certain specific Arab-Israeli problems will be resolved. Both Arabs and Israelis have shown a willingness to discuss better arrangements for the control of the armistice lines. Israel has expressed readiness to release a portion of the blocked Arab accounts. There have been indications that Israel might be willing to agree to slight modifications of its de facto borders, free port facilities in Haifa for Jordan, and a lump sum compensation for Arab property. In return, however, Israel would probably demand: reciprocal boundary rectifications, abolition of the economic boycott, and implementation of the UN Security Council Resolution of 1951 calling on Egypt to cease restrictions on shipping through the Suez Canal. In the present state of public opinion, Arab leaders will find it difficult to make such concessions. However, the Revolutionary Command Council government of Egypt, if successful in other fields, might take the lead in formulating a more conciliatory Arab policy toward Israel. The willingness of both sides to compromise and negotiate might be affected by a persistent Western policy of pressure and inducement, although neither Arab nor Israeli dispositions have thus far been significantly affected by limited Western efforts to achieve a compromise settlement.

48.

Israel has no ideological reason for being unequivocally on one side or the other in the East-West struggle. The influential socialist-labor movement in Israel takes the position that the East-West conflict is one between the extremes of capitalism and Communism, [Page 1289] and that the middle-ground of socialism is superior to both. In order to insure the continuance of US aid and to keep the way open for the emigration of Jews from the Soviet Bloc, Israel has sought good relations with both the US and the USSR. It has also sought to gain a bargaining advantage from the East-West power struggle. We believe that Israel will probably endeavor to remain neutral in the East-West struggle as long as possible, but is, under present circumstances, more favorably disposed toward the West. Israelis are aware of the extent of their economic dependence upon the West. They are, moreover, suspicious of Russia, with its long record of anti-semitism and anti-Zionism and its totalitarian form of government, and probably also doubt the likelihood of getting any substantial number of emigrants from the Soviet Bloc. In time of war, however, Israel will follow the course that it deems most expedient in the light of the pressures and inducements existing at the time.

49.

The USSR controls the only pool of probable future immigrants to Israel. The USSR is fully aware of this and of the potential which it gives them for throwing the Near East into turmoil. If the Soviet Bloc were to remove barriers to the emigration of its two and one-half million Jews, Arab fears of Israeli expansion would be increased, since they would be fully conscious of the pressures of a greatly expanded Israeli population for more land and resources. The “ingathering” of any considerable portion of the Soviet Bloc Jews would swamp Israel’s already precarious economy and would require greatly increased financial and material assistance. However, a decision to permit the wholesale immigration of Soviet Bloc Jews to Israel would constitute a reversal of long established policies toward Soviet peoples, Jews or otherwise.

50.

One of Israel’s most difficult foreign policy problems stems from the conflict between Western interest in the defense of the Middle East against Soviet aggression and Israel’s interest in security from attack by the Arab states. Israel fears a build-up of Arab military strength by the Western Powers and will make every effort either to prevent such a build-up or to maintain the present power relationship by obtaining equal aid for Israel. To maintain this relationship, Israel will almost certainly bring increased pressure to bear on the Western Powers, including the creation of border incidents, in order to support the argument that the Arabs are not to be trusted with additional arms.

51.

Israel in the past has expressed a desire to join a regional defense organization for the Middle East under the sponsorship of the Western Powers. Its principal object was probably to participate in any rearmament program that develops, and to be in a position to observe and protest measures which would increase Arab strength [Page 1290] relative to its own. In re-establishing diplomatic relations with the USSR on 20 July 1953, Israel promised not to join any “aggressive alliance directed against the USSR.” This undertaking is in line with Israeli policy of not aligning itself with either the West or the USSR until forced to do so. It would not, however, be regarded by the Israelis as inhibiting their participation in defense arrangements for the Middle East if it seemed advantageous.

52.

The Arab-Israeli dispute has seriously damaged the US security position in the Middle East by increasing area instability, by adding to the difficulty of organizing area defense, and by posing a continuing threat of armed conflict. The Arabs belief that the US favors Israeli interests over their own has been chiefly responsible for the decline of US prestige and influence in the Arab world.

53.

Because of Israel’s strategic position and communication facilities, wartime access to Israeli territory is highly desirable for the defense of the Middle East by the Western Powers. However, in the present state of Arab-Israeli relations, peacetime arrangements for the use by the West of Israel’s position and facilities would almost certainly provoke bitter Arab ill-will and jeopardize Western use of facilities in Arab countries. Moreover, Israel would demand an exorbitant price for any such peacetime arrangements, and has already indicated firm opposition to the stationing of foreign troops in its territory prior to the outbreak of war. Even in the event of hostilities, Israeli troops could probably not be used in combined operations with Arab forces, and Israel would be unlikely to send its own troops outside the country for fear of Arab attack. Israel would, however, fight tenaciously in defense of its own territory.

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

No. 649
National Intelligence Estimate1

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

No. 649National Intelligence Estimate1

No. 649
National Intelligence Estimate1