611.84A/8–2653: Telegram

No. 653
The Chargé in Israel (Russell) to the Department of State


261. Teddie Kollek, Director General Prime Minister’s office, called on me at his request ostensibly to raise again (Embtels 1181 [Page 1295] and 2302) US attitude toward Israel default but obviously also obtain impression general US policies toward Israel. I repeated I knew no US policy that Israel default would be favorable development; on contrary US is deeply involved in effort build sound Israel economy and default would be retrogressive symbol aside from factors he mentioned. I said US aid was dual objectives of advancing general human economic levels and promoting security of free world; we necessarily survey each situation periodically to determine whether our programs in fact working toward those ends. Said we had been concerned over:

Israel’s unusual degree of secrecy regarding military information, reprisals policy, deprecation MAC’s, “over our dead bodies” attitude toward negotiation outstanding issues with Arabs, sudden removal of Foreign Ministry to Jerusalem in midst of efforts to secure solution of Jerusalem problem that would be equitable to all; growing indications of impatience with US desire to devote economic aid to goals of sound economy of which Ekukol outburst was only culmination; and Eban’s high-handed disregard of plight of half million American boys in Korea. Said I was aware Israel leaders concerned over possibility of American military aid to Arab countries but that vacuum which existed from Turkey to sub-continent of India was open invitation to Soviet activity of kind which Soviet had thus far been unable to refuse; theory of defense of this area which is larger than whole United States by pouring military aid into Israel which is one-tenth size of Utah was unrealistic; effective strength of Israel could be destroyed by one planeful of bombs. Said Israel could have no legitimate fear re American policy of building strength in area since: (1) We had not contributed 300 million dollars to Israel only to have it pushed into sea, (2) our goal in area is peace and breaking out of war between Arab States and Israel would be negation of that, (3) Israel has as much to gain from policy of filling Near East security vacuum as any [Page 1296] country since if Soviet bombs were to drop in area, the first would be against Israel.

Kollek commented he thought structure I had built of Israel noncooperation was more imposing than facts indicated; that he would pass along my views.

  1. Not printed.
  2. In telegram 230, Aug. 20, Chargé Russell reported on a conversation with Oscar Gass, Chairman of the Economic Advisory staff attached to the Prime Minister’s office. Gass inquired about rumors that advisers to the U.S. Government in Washington were recommending default by the Israeli Government as a desirable measure. Gass said his own view was that Israel would be dependent on new loans, the refinancing of old loans, and capital investment for a long period to come, and in this light default would be most damaging. Russell replied that he knew of no U.S. Government policy favoring an Israeli Government default; that indeed for the reasons Gass mentioned and for other reasons, the United States believed default would have unfortunate consequences. Russell pointed out that U.S. financial aid to Israel was for the purpose of achieving economic objectives which had been made known to the Israeli Government; that, as Stassen had pointed out during his visit, economic aid would be related to free world objectives; and that it followed that the Israeli Government could not anticipate that the United States would under all circumstances guarantee the Israeli Government against default. (884A.10/8–2053)