Foreign Relations of the United States, 1955–1957, Arab-Israeli Dispute, 1955, Volume XIV

6. Memorandum Prepared in the Bureau of Near Eastern, South Asian, and African Affairs¹

Washington, January 14, 1955.

SUGGESTED MAIN POINTS OF APPROACH TOWARD ISRAEL-ARAB SETTLEMENT

1. Prospects: While the basic obstacles to Israel-Arab peace still exist, there are a number of reasons for believing that special efforts to induce the parties to take steps toward a settlement of their major differences might bear fruit. These include: an improvement during the past two years in the attitude of important segments of the Arab world toward the West and particularly toward the United States; the promises of the Egyptian government to take steps toward a settlement with Israel following the completion of the Suez base negotiations; the intense concern of Israel over its security and its desire for a treaty arrangement with some major Western power; the Turko-Pakistan² and Turko-Iraq agreements;³ and the comparative lull of the past few months.

2. Immediate Context: Regardless of the amount and variety of material inducements provided, they alone may prove insufficient to break the present stalemate without the addition of a psychological trigger. Psychological shocks have been applied to area problems in the past with success, for example, the Tripartite Declaration of May 25, 1950,⁴ and the military assistance agreement with Iraq of April 21, 1954.⁵

The announced intention of Iraq and Turkey to conclude a collective defense agreement against aggression from inside and outside the area could provide the necessary impetus. However, this development involves dangers and should be handled with delicacy. A worried Israel could react by aggressive moves on her borders. She will probably press with renewed insistance for some sort of security commitment or statement from the U.S. Egypt may resent the announcement which she will regard as a threat to her area leadership and as endangering the Arab League. At the same time the development may stimulate Egypt towards an agreement with Turkey during Menderes’ visit in March. In brief, the Turko-Iraq agreement may serve as a catalyst for further developments in the direction of the Alpha objective.

3. Basic Approach: U.S. and U.K. should formulate the elements of a fair settlement. An effort should then be made through various channels, including direct talks where possible, to get the parties to work toward such a settlement or an agreed variation of it. This is suggested in lieu of relying upon direct talks exclusively, and in lieu of a strict following of the Trieste approach. Direct talks may be impossible in some instances and a solution in the present case will require substantial contributions of an economic, political and security nature by outside countries. It is contemplated that different types of approaches would be made with different countries.

4. Principal Elements of Settlement:

a. Permanent recognized boundaries between Israel and neighboring countries after frontier rectifications. The principal boundary provisions would be:

(1) Division of the demilitarized zones between Israel and Syria.

(2) Minor readjustments of the armistice lines between Israel and Jordan to give villages some of the lands formerly belonging to them so that they may be economically self-supporting. In return for this Israel would receive the Latrun salient and a portion of the demilitarized zone in this area, thus placing the old Jerusalem road wholly in Israel.

. . . . . . .

b. Security on the border and cooperation in control of infiltration.

c. Termination of Suez Canal restrictions and of the Arab secondary boycott, recognizing that the primary boycott would be one of the last points of friction to disappear.

d. Agreements on repatriation and resettlement of refugees. This would be accomplished through: (a) agreement with respect to the Gaza strip refugees . . .; (b) resettlement of refugees in the lower Jordan valley under the Jordan River Development Plan; (c) possible resettlement under other similar development plans; (d) turning UNRWA funds over to the governments of Arab states having refugees and placing the responsibility for the refugees upon them. (This would have to be done gradually and with safeguards.)

e. Agreement on compensation of Arab refugees. Israel has declared her willingness to pay compensation but is financially unable to do so without outside assistance. A neutral international body—possibly a “Palestine Refugee Compensation Commission”—could be set up to administer the compensation plan. Israel could issue debentures to the total present evaluation of Palestine refugee real property in Israel (estimated by the PCC at $300 million), the proceeds of which would be utilized to pay the compensation. Working capital in the form of non-interest loans could be provided to Israel by the U.S., U.K., France and other interested governments.

. . . . . . .

g. A free port at Haifa for Jordan and free route across Israel linking Egypt with Jordan.

h. Agreement on the Unified Development of the Jordan Valley.

5. Inducements and Psychological Factors in Security Cooperation. The inducements and psychological factors which can be utilized in securing the cooperation of Israel and the various Arab states are summarized in attachments A through E.

6. Order of approach to Arab countries: Our first approach should be to Egypt, with the realization, however, that if Egypt is to take effective action it must be accompanied or closely followed by action on the part of Jordan. It would be hoped that Lebanon could follow as the third cooperating Arab country. Only after some progress had been made with these three countries would it be worthwhile to make any approach to Syria, Iraq and Saudi Arabia. The nature of such an approach would depend upon the circumstances existing at that time. The approach to Egypt should be in such terms that Egypt does not obtain a veto power over an alternative approach if one becomes necessary.

7. Intra-Area Security: Steps to create a sense of security on the part of Israel could be:

a. Early statement by Secretary Dulles similar to Sir Anthony Eden’s concerning current validity of the Tripartite Declaration.⁶ The Secretary’s statement should follow the Tripartite Declaration more closely than Eden’s did and should not refer to a “balance of arms”.

b. If the British are prepared to do so, a treaty of mutual assistance between Britain and Israel. Israel is at present suffering from a severe feeling of isolation because of the various treaties and agreements between Arab nations and one or more of the great powers while Israel has no such ties (her policy until recently was to avoid such ties). It is unlikely that Israel can be counted upon to engage wholeheartedly in an effort toward area peace in the absence of a treaty with some outside power. The I.G. does not regard a unilateral undertaking by one or more outside powers, to which Israel is not a signatory, as adequate although they would undoubtedly welcome such a commitment if it were supplementary to a treaty arrangement. There appear to be greater objections to a treaty between Israel and the United States, France or Turkey than to one with Britain.⁷

c. If (b) proves impracticable, or if Britain makes a treaty with Israel but desires a supporting arrangement, an agreement in treaty form by the U.S., Britain, France and Turkey that if the integrity of the territory or the sovereignty or political independence of Israel on the one hand or of Egypt, Saudi Arabia, Jordan, Syria, Lebanon and Iraq on the other is threatened by any act of the other it would be considered that it constituted a danger to the security of the participating states. In such an eventuality the signatory states would take effective action both in and outside the United Nations in accordance with their respective constitutional processes to meet the common danger.

It will be noted that (a) above is a “holding operation”. If (b) proves possible but Britain desires some kind of additional supporting agreement from the United States, but it does not appear possible for the U.S. to give the kind of commitment indicated in (c) above, it might be possible to devise some form of supplemental treaty which would take care of Britain’s requirements.

As a further alternative to (b), the United States, the United Kingdom, and possibly France and Turkey might enter into an arrangement with Israel for her defense against extra-area aggression along the lines of the Manila Pact. It is assumed in connection with this suggestion that the Western states would have already entered into this kind of association through a regional defense arrangement including at least one Arab state (Iraq). We might associate ourselves with the Turko-Iraq treaty with a proviso that we would be concerned under it only with external aggression. This type of arrangement would probably be somewhat less attractive to the Israel Government than (b) but with (c) it might meet their psychological needs.⁸

8. Relation between Alpha and Area Security: We should progress simultaneously toward the two major U.S. objectives in the area— area defense and Arab-Israel settlement—adjusting tactics so that progress toward one objective will assist, or at least not unduly impede, progress toward the other. It is assumed that the Northern Tier is our immediate approach to area defense but that we hope to expand the defense plans eventually to include the effective use of the armed forces and facilities of Israel, Egypt and the other Arab states.

9. Arab League: . . our approach is not based upon utilizing the Arab League . . . . At the same time we should bear in mind the desirability of economic cooperation among the Arab states, and the eventual possibility of federation between two or more Arab states.

[Attachment] “A”

ISRAEL

Inducements and Psychological Factors in Securing Cooperation

1. Israel urgently desires assurances that would strengthen her security and position within the area militarily and politically. She would prefer these assurances in a formal treaty with a strong Western power, either the United States or the United Kingdom, although an alternative arrangement as set forth in paragraph 7 of the covering paper might be satisfactory. If the possibility of one of these arrangements should be decided upon, it should be proffered to Israel as a prize to be won through complete cooperation with the United States and the United Kingdom in the negotiations for a general settlement.

2. The plan for the unified development of the Jordan Valley, with all that it offers to Israel economically and in commencing a solution of the Arab refugee problem, should, at an appropriate time be linked into a general settlement. More specifically, U.S. willingness to provide funds for Israel’s water development could be made contingent upon I.G. cooperation.

3. Israel would prize highly assurances from the United States that the economic future of the country is a matter of more than routine interest. We might express to Israel our continued willingness to cooperate with her in striving for economic viability without, however, committing ourselves to any specific level of continuing aid.

4. The point can be made to the Israel Government that there is little prospect of effective Israel-Western collaboration in the field of area defense until a general settlement has been achieved.

5. United States Jewry could, at an appropriate time, play an important role in influencing the I.G. to cooperate. Jewish donors to Israel will be interested in a program which holds promise of reducing the high annual level of their contributions to Israel as a result of peaceful conditions. Moreover, they would probably be responsive to the argument that Israel-Arab tensions, in the absence of a plan to which both sides must make concessions, will be an increasingly disturbing and troublesome obstacle to Free World security in the Middle East.

6. We can point out to the I.G. that the substance of our proposals is not at all unfavorable to Israel, nor, in many respects, much at variance with suggestions the Israelis themselves have made in the past. This is particularly true of our suggestions with respect to such problems as refugees, the Jordan River, the future status of Jerusalem, and Israel’s frontiers, the Suez blockade and the secondary boycott.

7. While in its early stages Operation Alpha must be secret, there will come a time when it must be made public that the United States and the United Kingdom are exerting direct efforts to improve intra-area relationships. At that time a high level United States–United Kingdom statement of the immeasurable advantages of peace to all concerned might be voiced in a way to serve as a lever for moving the Israel public, and perhaps the Arabs, forward.

[Attachment] “B”

EGYPT

Inducements and Psychological Factors in Securing Cooperation

1. The settlement itself provides little attraction to Egypt. We are already committed to continue certain programs in Egypt regardless of her attitude towards Alpha. Specific returns which we now receive include: general support of Western position on world questions; assistance on the Johnston Mission; agreement to the UNRWA-Sinai project.⁹ Because of the relatively limited supply of “carrots” available it will be necessary to space them out avoiding too heavy an expenditure during early stages of negotiations.

2. Egypt is primarily interested in military aid without any commitments, at least in the early stages. At the time of the initial negotiations we might agree to extend credit for the purchase of arms under Section 106(b)¹⁰ (credit for 3 years to be paid back in dollars), possibly in the amount of $20 million. Depending on GOE performance during the negotiations, we could later offer a standard MDAP agreement which would cover the amount of credit extended plus an additional sum. Nasser’s domestic position might permit signature immediately following the first substantial arrivals of U.S. equipment. Alternatively, if the Egyptian domestic situation made it imperative, we could provide grant aid under Section 401,¹¹ consequent to a special determination by the President. (In this connection, it may be noted that Israel’s objections to arms aid to the Arab states have been based largely on the state of war existing between Israel and the Arab countries. If arms aid to an Arab country were offered in connection with a program for negotiations for peace and was to be in whole or in part conditional upon the success of the negotiations, a large part of the Israel case against the arms aid would fall.)

3. We could in any event consider a substantial increase in the number of positions allotted to Egyptian students in U.S. military schools and the assignment of high priority to Egyptian purchases of U.S. military equipment. A start could be made on the present order for 54,000 helmets which Defense informally estimates might be delivered within one month.

4. Special economic aid inducements in addition to current programs might include:

a. Committing the Executive, subject to Congressional appropriations, to allot a specific amount as grant assistance to the High Aswan Dam project as soon as engineering studies are sufficiently advanced to permit useful expenditure of the funds. The amount might be $20 million.

b. Depending on Egyptian performance during negotiations, committing the Executive to provide additional grant sums to assist in subsequent phases of the High Aswan Dam project. The amounts provided by the U.S. might be such as to cover the gap between Egypt’s borrowing capacity as determined by the IBRD and the yearly cost of the project, possibly $20 million per year for five years.

c. Concentration of the Atomic Energy project for the Middle East in Egypt. This would include:

(1) Expanded assistance in establishment of the radioisotope laboratory now underway.

(2) Establishment of, and necessary training for, an atomic reactor.

d. Using U.S. food surpluses to assist Egypt. Wheat is the main requirement.

e. Assisting Egypt in marketing her cotton crop. This would include consideration of the U.S. cotton quota and special attention to the effect on Egyptian markets of disposals of U.S. cotton surpluses.

5. We should participate on a major scale in the international fair planned for January 1956 in Egypt.

6. We could consider steps which might be taken to support Egyptian area aspirations, such as using Egypt as a center for telecommunications, air, or other regional activity, bearing in mind that involved in this matter is Egyptian rivalry with Iraq and the desire of both for area leadership. A security arrangement by which Egypt would be accorded recognition similar to that now given Turkey and Pakistan could have a great effect in this respect.

[Attachment] “C”

JORDAN

Inducements and Psychological Factors in Securing Cooperation

1. The status quo in the Near East is not in Jordan’s interest. Her economy can never be properly developed in the present situation. All Jordan’s neighbor states contain elements which entertain notions as to Jordan’s future which do not coincide with Jordan’s interests. In the absence of a general settlement of the Palestine issue Jordan can only remain as a semi-isolated entity with an uncertain future dependent on external support. Whether Jordan decides that her future lies in continuing as an independent and fully sovereign entity or as a member of a voluntary federation with another Arab state or states, it is to her interest to strengthen herself. Should she wish to enter a federation it should be as an equal partner in fact as well as in name.

2. It could be pointed out to Jordan that she is bearing a heavier burden as a result of the Palestine hostilities than any other Arab state. In the day-to-day life of the area almost the full brunt of sporadic hostilities falls upon Jordan. It is Jordan’s trade and communications with the outside world which has been the most thoroughly damaged. Jordan therefore has the most to gain from a resolution of the Palestine difficulties. It is time for Jordan to look to her own interests and to select a course of action which will benefit her the most. The United States and the United Kingdom could then cooperate with Jordan in persuading other Arab states of the necessity of Jordan’s participating in a just and equitable settlement of the controversy. Past experience has shown that Jordan’s leaving the initiative to the Arab League is a fruitless and dangerous course.

3. In the type of settlement which we have in mind Jordan will receive a great deal of what she has demanded. There will be provisions for territorial adjustments, repatriation of some refugees, rehabilitation of the rest, and arrangements for compensation. The United States would likewise be prepared to support Jordan in obtaining facilities through Israel for communications with other Arab states and the outside world. . . . Jordan is already aware of our active support of the proposition that the HKJ must have her full share of the waters of the entire Jordan–Yarmuk system.

4. The United Kingdom and the United States would express their continued willingness to cooperate with her in striving for economic viability without, however, committing themselves to any specific level of continuing aid.

5. We fully appreciate that any settlement at all, no matter how just and equitable, would arouse considerable opposition among certain extreme elements in Jordan’s population and create a serious internal security situation. To this end we would be prepared to consult with the Jordanians on ways in which we can be of assistance in dealing with this problem during the transition period. We would also be prepared to speak to Israel in the strongest terms of the necessity for a tranquil border situation.

[Attachment] “D”

LEBANON

Inducements and Psychological Factors in Securing Cooperation

1. It will not be possible to induce Lebanon to consider moving toward a firm settlement with Israel unless either Egypt or Jordan has already done so. Indeed it is probable that Lebanon will not make a settlement unless both Egypt and Jordan have already done so. If Egypt and Jordan move toward a settlement, and the Government of Lebanon is aware that this is so, the following inducements would help to persuade the Lebanese to follow the Egyptian and Jordanian lead in undertaking a settlement. Each should be offered to the Lebanese conditional upon their actually following the Egyptians and Jordanians in undertaking a settlement. Irrespective of such positive action as Lebanon might take it is to be foreseen, on the basis of past experience, that the Lebanese would probably be disposed to exert constructive efforts behind the scenes, particularly in respect of Jordan.

2. The Lebanese are most anxious to receive military aid from the U.S., which they desire primarily for internal security and prestige reasons, and as a sign of the recognition by the U.S. of the importance of Lebanon. The cost to the U.S. would be perhaps $5 to $10 million.

3. The Lebanese would like to receive economic aid on a much larger scale than at present (in FY 1954 they received $6 million economic assistance; the figure for FY 1955 will be much smaller). The Lebanese would like us to finance a significant portion of the Litani River development project, and they would like large scale help for example, with their road program. An offer of some $10 million for these or similar purposes, over and above our “normal” technical assistance and economic aid, would be genuine inducement.

4. Like the other Arab states, Lebanon fears that Israel unless held in check may some day attempt to expand at Lebanon’s expense. The Lebanese fear that Israel some day may attempt by force of arms to establish control over the waters of the Litani River for the benefit of Israel. A Western security guarantee of Lebanon against the possibility of an attack by Israel would be most welcome. A quadripartite guarantee of Lebanon’s borders against Israel aggression (and vice versa), as suggested in 7 (c) of the covering paper, conditional upon a Lebanon–Israel peace settlement, would thus constitute an effective inducement.

5. A basis fear of the dominant Christian element in Lebanon is that some day the country may lose its separate identity through absorption into the neighboring Moslem states, particularly Syria. At the time of the Tripartite Declaration, it was stated orally to one or more of the Arab countries, including Saudi Arabia, that the Declaration would be interpreted by the United States as applying to an act of aggression by one of the Arab states against another, as well as to an act of aggression by Israel. A reaffirmation of this to Lebanon would be well received there. In taking such a position, however, we should make it clear that we are not against voluntary federation by two or more of the Arab states.

[Attachment] “E”

SYRIA

Inducements and Psychological Factors in Securing Cooperation

1. Syria, like Iraq and Saudi Arabia, will be far more hesitant than Egypt, Jordan or Lebanon to move toward a settlement with Israel. The mood in Syria at the present time is so negative, so violently anti-Israel, so anti-Western that it is inadvisable to approach Syria regarding a Palestine settlement at least until some time after the approaches to Egypt, Jordan and Lebanon have been made, and have produced results. Under these circumstances, however, Syria might consider moving toward a settlement. Syria has a common boundary with Israel, and certain territorial aims in the demilitarized zones and desires changes in the present armistice line which might be realized in part by a settlement with Israel. Syria has more reason to make a settlement than either Iraq or Saudi Arabia.

2. Under the changed circumstances, the most effective inducements for Syria would be the same as in the case of Lebanon: military aid sufficient to strengthen significantly the Syrian Army; economic aid (for such projects as roads, port development and irrigation work on the Euphrates); and a quadripartite guarantee of Syria against Israel aggression.

1. Source: NEA Files: Lot 59 D 518, Washington Talks, Jan.–Feb. 1955: Memos, etc. preceding actual meetings (Dated 11/15/54 thru 1/27/55). Top Secret; Alpha. Russell forwarded the memorandum to Secretary Dulles and Under Secretary Hoover on January 16 as an attachment to a memorandum which noted the paper “reflects discussions with, and has received the concurrences of, Mr. Hare, Mr. Jernegan. . . .” (Ibid.)
2. On April 2, 1954, Turkey and Pakistan signed an Agreement for Friendly Cooperation, which among other points provided for consultation and cooperation on certain defense matters.
3. On January 12, following discussions between Turkish and Iraqi officials in Baghdad, a joint communiqué was issued stating that Iraq would conclude a military alliance with Turkey which other Middle East states would be invited to join. Text of the communiqué is printed in Noble Frankland (ed.), Documents on International Affairs, 1955 (London, Oxford University Press, 1958), pp. 286–287.
4. For text of the Tripartite Declaration of May 25, 1950, see Department of State Bulletin, June 5, 1950, p. 886.
5. For documentation regarding the negotiation of a military assistance agreement with Iraq on April 21, 1954, see Foreign Relations, 1952–1954, vol. IX, Part 2, p. 2384. For texts of the notes exchanged between representatives of the United States and Iraq, see TIAS 3108; 5 UST (pt. 3) 2496.
6. For text of Eden’s remarks, see Parliamentary Debates, House of Commons, 5th series, vol. 532, cols. 324–335. Further information is in Department of State, Central File 684A.86
7. At a meeting on January 17, Dulles considered the proposals advanced in this memorandum and ordered that the Department officers involved in the forthcoming discussions with Shuckburgh “take care not to appear to propose that the United Kingdom enter into a treaty as suggested under 7b with Israel.” The Secretary had no objection, however, if Russell and his colleagues asked if “the British Government might itself favor entering into such an arrangement.” (Undated and unsigned typewritten memorandum; Department of State, NEA Files: Lot 59 D 518, Washington Talks, Jan.–Feb. 1955: Memos, etc. preceding actual meetings (Dated 11/15/54 thru 1/27/55))
8. At the January 17 meeting, Dulles “inquired whether it might be helpful, if in this connection with paragraph 7c, U.S. in conjunction with the U.K., France, Turkey, Israel and the Arab states enter into a treaty commitment embodying the principles of the Tripartite Declaration of May, 1950. . . . This treaty would be a formal one calling for ratification by the Senate.” (Ibid.)
9. Reference is to an agreement between representatives of UNRWA and the Government of Egypt to search for practical development projects in the Sinai Peninsula as well as in the Gaza Strip to enable Palestinian refugees to become economically self-supporting.
10. Section 106 of the Mutual Security Act of 1954, which became Public Law 665 on August 26, dealt with the sale of military equipment, materials, and services. For text of the act, see 68 Stat, (pt.1) 832.
11. Section 401 of the Mutual Security Act of 1954 authorized the President to extend special grant assistance to individuals or nations when he determined that such assistance would contribute to the defense of the North Atlantic area or to the security of the United States.