Foreign Relations of the United States, 1955–1957, Arab-Israeli Dispute, January 1–July 26, 1956, Volume XV

386. Memorandum From the Secretary of State’s Special Assistant (Russell) to the Secretary of State¹

Washington, June 5, 1956.

SUBJECT

• Next Steps Toward Settlement of Arab–Israel Dispute

Discussion:

Nasser’s present attitude toward the West and his recent posture toward Israel make it unlikely that the U.S. can serve effectively in the near future as an intermediary in bringing about a settlement between Israel and Egypt. While our first concern now must be the bolstering of the West’s position in the Arab world, we should continue to give thought to the most likely ways of making progress on the Arab–Israel dispute. The impossibility of direct U.S. efforts at intermediation does not mean that the principles enunciated in the Secretary’s August, 1955, speech are invalid but merely that new approaches may have to be sought. The purpose of the present paper is to explore fresh ways of working toward those objectives. If the proposals in the following paragraphs appear to be feasible on general considerations, comments should be sought from the field and from the offices and agencies that would be directly involved. Any concrete action pursuant to the proposals should be checked before it is taken with respect to any possible adverse effect it might have on other objectives we are pursuing in the Middle East.

Proposals:

1. Hammarskjold has indicated in private talks that he believes, if relative calm can be maintained in the area for a period of several months, progress could be made on specific issues such as the Jordan waters and the use of the Suez by Israel. We might indicate to him our desire to support him effectively in any approaches he may find it possible to make and discuss with him ways in which such support could be most effective.

2. In the April 17 statement from Moscow,² in the London communiqué,³ and in the May 31 statement of the Soviet representative on the Security Council,⁴ the Soviet Union expressed its willingness to support continuing “efforts until a lasting and peaceful settlement of the whole Palestine problem has been achieved.” The Soviet position on Syria’s request for amendment of the resolution which the U.K. introduced in Security Council,⁵ to be sure, showed that Soviet support of steps toward a settlement will not be allowed to go so far as to incur any great loss of Arab good will. Ambassador Lodge, in his May 25 telegram,⁶ said that we would in all probability be faced with future proposals for four power sponsorship and that we should be giving consideration to our policy position on the question. While there is doubt about the wisdom of four power sponsorship, we might let the British carry the ball in probing the Soviet position. It would be a normal follow–up to the Soviet–UK discussions in London. Furthermore, the British, as members of the Baghdad Pact, would be in a logical position to give intimations of willingness by the Baghdad Pact powers to give assurances with respect to additional bases in Arab territory and possibly certain other assurances in return for concrete progress on a Palestine settlement and Soviet assurances on such things as arms shipments. In short, the British would probe Soviet willingness to support specific steps by Hammarskjold at such time as Hammarskjold was willing to embark upon a step by step approach to the Palestine issues. This would avoid the “four power” approach which the Soviets appear to be seeking. Needless to say, we should make no commitments with respect to the Baghdad Pact except in return for concrete and completed measures that would constitute an adequate quid pro quo. There are obvious risks in such an approach but these risks must be balanced against the alternative risks arising from the fact that Nasser is still making progress, that the Soviets are in a fair way to share in it and that the extent of our capacity to stem this development is still problematical.

3. It cannot be assumed that the efforts suggested in the preceding paragraphs will provide a solution of any of the Palestine issues. Other measures should, therefore, be simultaneously considered. One such would be a new and indirect effort to secure Arab support for the development of the Jordan waters. There appears to be slight prospect of getting Arab agreement now to the Johnston Plan in its present form and with its predominant U.S. sponsorship. The attached memorandum (Tab A) suggests that we support Lebanese Foreign Minister Lahoud in his proposals for initial separate construction on the Israel and Arab sides of the Jordan which could later be coordinated.

4. As an integral part of this approach, steps should be taken at the next General Assembly to shift the administration of funds for refugee support from UNRWA to the governments in the Arab countries where the refugees are located (Tab A). Henry Labouisse, Director of UNRWA, recommends this step. If it is decided to move in this direction, it could be suggested to him in a discreet way at an early date that he prepare detailed proposals which could be introduced in the Ad Hoc Political Committee of the next General Assembly. This would be resisted by the Arab Governments but, if they were confronted with a possible cessation of refugee aid otherwise, it might be effected. Such a step would tend to bring about the gradual integration of the refugees into the Arab countries. We should endeavor to have the initiative taken at the General Assembly by some other government than the U.S. We should, however, be prepared to indicate U.S. willingness to contribute to development schemes in the Arab countries that would facilitate such integration.

5. Partly for the reason mentioned in the preceding sentence but also because of the intrinsic psychological and political advantages that would accrue, we should move as rapidly as possible to put ourselves in a position to announce a program for making available in the Middle East new methods for purifying saline water (Tab B)⁷ and for additional river development projects. Pilot operations in the purification of saline water are on the point of fruition. The Department of Interior has well advanced projects based on solar evaporation. An ionic membrane process, which might be linked to atomic energy, has been brought to an advanced state of development by a number of firms. The Department of Interior’s program, however, is in danger of being greatly slowed down by the denial of funds in Congressional appropriations. There is patent litigation between American and Dutch firms with respect to the ionic membrane process. If a member of the White House staff were charged with responsibility, he might be able to have alternative funds, which would not have to be large, made available to the Department of Interior by the President. He might also be able to bring the parties to the dispute over the ionic membrane patents to an agreement permitting the use of the process for the purpose suggested herein. It would then be possible for the Secretary or the President to make an announcement at an appropriate time that we would give financial support to utilization of these processes in the Middle East and possibly also assist further in conventional river development, notably in Syria. Such an announcement would help to counter–balance for other Arab countries the recent concentration on the Aswan Dam.

Recommendation:

That, if it is decided that a new approach to the problem of a Palestine settlement should be sought, staff work, including solicitation of views from the field, be undertaken preparatory to:

1. Instructing Ambassador Lodge to inform Hammarskjold in accordance with paragraph 1 above.

2. Arranging for the Secretary to discuss with Ambassador Makins the possibility of proceeding in accordance with paragraph 2 above.

3. Responding to Foreign Minister Lahoud’s proposals in accordance with Tab A.

4. Suggesting to Henry Labouisse that he prepare specific proposals in accordance with paragraph 4 above.

5. Discussions by the Secretary with the White House on steps to carry out the proposals in paragraph 5 above.

[Tab A]

AN ALTERNATIVE TO THE JORDAN VALLEY PLAN⁸

Foreign Minister Lahoud of Lebanon is in secret touch with Ambassador Heath in an effort to find some means of resolving the Jordan River impasse. Beirut’s telegram 1405 of May 5⁹ reports that Lahoud has asked “Ambassador Johnston and his experts” to come up with a plan which he might present to his fellow Arabs. The following is a proposed “Lahoud Plan”, to be put forward as his own brainchild, to which we would agree if he secured sufficient Arab support. Each component of the plan is set forth in the terms Lahoud would probably find advantageous, followed by a brief explanatory comment. While the basic plan contains no new elements, some new ideas are brought to bear which should increase the prospects of success.

1. “The Arab states are capable of planning and working out their own destiny, and they are determined to guide their future with their own hands. This applies to decisions respecting the development of their water resources, as well as to the other decisions facing the Arab world.”

One of the major obstacles to the acceptance of the Jordan Valley Plan has been its sponsorship by the United States, with the consequent fear that it has some hidden pro–Israel motivation. It is doubtful that United Nations sponsorship would produce any better results; the history of the partition of Palestine and the controversies surrounding the Truce Supervision Organization do not augur well. Sponsorship by the U.K. or another nation would be still less effective. Arab sponsorship, taking advantage of growing nationalist sentiment, is, therefore, the most likely solution.

2. “As a first stage in the Arab development of the Jordan River basin, a diversion dam should be constructed at Adasiya, a canal should be built down the West Chor in Jordan, and Lebanon and Syria should speed up the exploitation of the Hasbani and Banyas Rivers, before they flow into Israel.”

The “exploitation of the Hasbani and Banyas Rivers” is window dressing, with little meaning. It is provided for in the Jordan Valley Plan. The division dam at Adasiya is the key to the solution of the Banat Ya’qub question, since both diversion points lie in demilitarized zones. General Burns has made it clear that permission to work on the Adasiya diversion would leave him no alternative but to grant similar permission to the Israelis. For that reason, Syria has in the past refused to cooperate with abortive Jordanian efforts to secure agreement on construction at Adasiya. This cooperation is essential since Syria controls both banks of the Yarmuk at that point, and it is not considered likely that Lahoud’s sponsorship would in itself overcome Syria’s reluctance to provide Israel with a tool for use at Banat Ya’qub. The following techniques are therefore proposed to overcome Syrian opposition:

(a) An arrangement should be worked out with Israel whereby the Israelis would apparently abandon, at least for the present, the proposed diversion at Banat Ya’qub in favor of a diversion north of Lake Huleh, where there is no demilitarized zone and where Israel controls both banks of the Jordan. A diversion at such a point would be difficult from an engineering point of view and would involve costs which would probably make the diversion uneconomic. Nevertheless, with some effort and with the cooperation of Israel (on both counts, the problems are considerable and would justify a separate memorandum, but they are amendable to solution), a convincing showing can be made that Israel is not dependent upon work in the demilitarized zone to carry its own plans through to fruition. Such a showing, properly timed, would take the spotlight off Banat Ya’qub and would greatly ease Lahoud’s task. It would not be necessary to carry the alternative diversion through to completion.

(b) We should make arrangements with Israel and General Burns so that permission for the Israelis to resume work at Banat Ya’qub will not be effective or used until construction is well under way at Adasiya, and the Arabs have tangible evidence of their water development.

(c) Lahoud should be placed in the position of holding out the hope of United States financing for a storage dam on the Yarmuk, suitable for power for Syria, to be built at a later stage. This hope is provided by the remaining elements of the plan, as described below.

3. “The next stage would be the construction of a high dam on the Yarmuk at Maqarin. This dam would store the waters of the Yarmuk on Arab soil, and would provide power for industrial use in Syria and Jordan. When this dam has been built, it will be possible to complete the canal network in the Ghor and irrigate the Jordan Valley clear to the Dead Sea. We would not, however, abandon Arab rights to store water in Lake Tiberias at some later date if it is advantageous to us and is carried out under conditions that are completely suitable to us. But before we will consider any Tiberias storage, we insist that primary storage be constructed first on Arab land.”

This part of the plan involves the U.S. in some financial risk. If we get into a position where we must assist in paying for a “high dam on the Yarmuk” (a 300 MCM reservoir is meant here), but with inadequate assurances that the dam will be tied into an overall program which has a very high cost per acre and on which there will be little refugee resettlement. The political benefits might warrant our proceeding, however, if the following steps are taken to minimize the risk:

(a) In the detailed plan, the assertion of “Arab rights to store water in Lake Tiberias” would be so phrased as to imply a commitment to store water there if the advantages are clearly demonstrated on engineering grounds. The Israelis have already agreed, in effect, to hold storage space available for the Arabs for several years.

(b) In considering the extent of our commitment (see below), we would exclude any help in financing the expensive costs of land preparation, construction of laterals, drainage, etc., except in connection with specific refugee projects.

(c) Most important of all, we must make the decision to insist during the forthcoming meeting of the General Assembly on instituting a progressive transfer of the responsibility for the administration of refugee relief to the individual countries concerned. This transfer will be strongly resisted by the Arab countries and will be very difficult to accomplish. Nevertheless, it is the only way we can protect ourselves from the prospect of an ultimate refusal by the Arabs to use the water conserved by “Lahoud Plan” facilities in resettlement of refugees. The Jordanians, in particular, argue with some logic that the refugees cannot have a prior claim on the best potential farm land in Jordan, and that the refugees are no more in need than many other impoverished Jordanians. A case can be made that the refugee problem can be solved only by general economic development, through which refugees and non–refugees alike would participate in the new opportunities offered. But if UNRWA is not to resettle the refugees in its charge, removing the refugees from its ration rolls one by one as they reach the point of self–support, we must be in a position to make reductions in total relief expenditures in each country which are proportionate to the contribution toward its general development, leaving to each country the adjustment of rations within its borders.

4. “The plan would be financed by a Jordan Valley Development Authority, run by and for the Arabs. This Authority would obtain its funds through capital lent on a no–interest basis by the Arab states, and it would welcome loans from other countries on a similar basis, except that the principle of Arab control would at all times be maintained. Many nations speak much of Arab friendship; the reaction from the world to the financial needs of the Authority would show which countries really have Arab interests and objectives at heart. The Authority would receive income from the sale of electric power and from water fees, which in time would restore the funds expended.”

Contributions from most Arab countries would be nominal, although Iraq, Kuwait and Saudi Arabia might provide significant help. There is a possibility that the Soviet Union or one of the satellites might contribute, though this seems unlikely. If there is no Soviet contribution, of course, we would gain an important public relations advantage. Most of the funds would of necessity come from the U.S., although some help could probably be secured from the U.K. and several of the Commonwealth nations. France is unlikely to make more than a gesture of assistance.

It would not be expected that the Authority would in fact be able to repay the loans which constitute its basic capitalization, but it would be wise to make it as nearly self–liquidating as possible for two reasons: (1) To the extent that it produces an income which can be re–invested within the Valley, it will reduce the pressure for additional aid, and (2) the theory of a self–liquidating operation makes loan assistance, as opposed to grant assistance, more plausible. This is not only preferred by our Congress, but would probably make it technically easier to attach conditions which will keep in our hands a measure of control over the Authority’s dollar funds, despite the Arab control over the Authority as a whole.

Conclusion:

This proposal has a fair, though not better than that, chance of success. The major question is whether we would find it worth the cost and effort, assuming it were to succeed. Certainly, it has a better chance than the Jordan Valley Plan as it now stands.

1. Source: Department of State, Central Files, 684A.86/6–556. Top Secret. Also addressed to Hoover. The source text bears a notation that Dulles saw this memorandum. Another copy of the memorandum is ibid., S/S–NEA Files: Lot 61 D 417, Omega #6.
2. See Document 291.
3. Reference is to a British–Soviet communiqué issued at the conclusion of the Bulganin–Khrushchev visit to the United Kingdom, April 26. The text was transmitted to the Department in telegram 4888 from London, April 26. (Department of State, Central Files, 033.6141/4–2656)
4. For text of Arkadi Aleksandrovich Sobolev’s statement to the Security Council on May 31, see U.N. doc. S/PV.725, pp. 32–34.
5. See Document 376.
6. Reference is to telegram 1030 from USUN, not printed. (Department of State, Central Files, 684A.86/5–2556)
7. Not printed.
8. Secret. Drafted by Troxel on June 5.
9. Not printed. (Department of State, Central Files, 684A.86/5–556)