412. Memorandum of Discussion at the 289th Meeting of the National Security Council, Washington, June 28, 19561
Present at the 289th Council meeting were the following: The Vice President of the United States, presiding; the Secretary of State; the Acting Secretary of Defense; and the Director, Office of Defense Mobilization. Also present were the Secretary of the Treasury; the Attorney General (for Items 1, 2 and 3); the Secretary of Commerce (for Items 2 and 3); the Special Assistant to the President for Disarmament; the Director, Bureau of the Budget; the Director, International Cooperation Administration (for Item 2); the Director, U.S. Information Agency; the Chairman, Civil Aeronautics Board (for Item 3); the Chairmen, Interdepartmental Intelligence Conference and Interdepartmental Committee on Internal Security (for Item 2); the Under Secretary of State; Assistant Secretary of State Bowie; Mr. Victor Cooley, Office of Defense Mobilization (for Items 2, 3 and 4); the Chairman, Joint Chiefs of Staff; the Director of Central Intelligence; Special Assistants to the President Anderson and Jackson; the White House Staff Secretary; the Executive Secretary, NSC; and the Deputy Executive Secretary, NSC.
There follows a summary of the discussion at the meeting and the main points taken.
1. Significant World Developments Affecting U.S. Security
[Here follows an oral briefing by the Director of Central Intelligence on significant world developments with specific references to reaction outside the Soviet bloc to the publication of Khrushchev’s secret speech at the Twentieth Party Congress and to the subsequent de–Stalinization campaign.]
[Page 755]Mr. Allen Dulles said that, owing to the length of the previous discussion, he would shorten the remainder of his intelligence briefing. He did wish, however, to mention a few developments. There was a report … that when the new Soviet Foreign Minister, Shepilov, visited Cairo he had offered to assist the Egyptians to build the High Aswan dam. Allegedly the offer consisted of a loan of 400 million for 60 years, with no interest. The report states that Shepilov also offered to cancel in toto the Egyptian debt for all bloc arms acquired by Egypt up to this time. Lastly, he had offered to take all of Egypt’s cotton crop and to build a steel mill at very low interest rates.
Secretary Humphrey said he was glad to hear of the Soviet offer to build the High Aswan dam, and be hoped the Egyptians would accept it, since that was the best possible thing that could happen for the United States.
With respect to the Russians taking over the High Aswan dam project, Secretary Dulles commented that the immediate results would be bad for the United States, but that the long–term results might be very good. Whatever nation undertakes to carry through this project was bound to end up by being very unpopular with the Egyptians. The building of the dam was bound to place a heavy burden on the Egyptian economy and standard of living, and the Egyptians would blame the austerities they suffered on the nation which was undertaking this great project. Moreover, the Egyptians would continuously ask for further financial assistance from this nation. In short, the project of building the dam would prove a terrific headache to any nation that undertook it.
Secretary Humphrey again commented that he hoped that the United States would not be saddled with this undertaking. Governor Stassen inquired as to whether the immediate reaction would be bad if the United States actually withdrew its current offer to assist Egypt in building the High Aswan dam. Secretary Humphrey replied that he did not care how we did it, but if there were any way for the United States to back out of the offer, he desperately hoped that we would seize upon it.
Continuing his briefing on the Soviet Foreign Minister’s tour of the Middle East, Mr. Allen Dulles said that in Syria2 the Syrian Prime Minister had attempted to get a strong anti–Israeli statement out of Shepilov.3 He had failed to do so, and the results had been bad for Shepilov ever since then, as was shown by the critical [Page 756] statement on Shepilov issued by the Government of the Lebanon.4 In Egypt, Colonel Nasser had apparently been very cautious in his dealings with Shepilov, and Mr. Dulles said he doubted if, on balance, Shepilov’s visit had significantly changed the situation in Egypt.
[Here follows discussion of the situation in Iceland and in Guatemala.]
The National Security Council:5
Noted and discussed an oral briefing by the Director of Central Intelligence on the subject, with specific reference to reaction outside the Soviet bloc to the publication of Khrushchev’s secret speech at the Twentieth Party Congress and to the subsequent de–Stalinization campaign; the behavior of Soviet leaders at the Kremlin reception for visiting Air Force delegations; the Soviet Foreign Minister’s trip to the Middle East; and the situations in Iceland and in Guatemala.
[Here follows discussion of East–West exchanges, United States civil aviation policy toward the Soviet Union and its satellites, and United States policies toward the Near East.]
- Source: Eisenhower Library, Whitman File, NSC Records. Top Secret; Eyes Only. Drafted by Gleason on June 29.↩
- Soviet Foreign Minister Shepilov visited Syria June 22–25.↩
- The Syrian Prime Minister tried to get such a statement of support for the Arab cause from Shepilov on June 23.↩
- Shepilov visited Lebanon June 25–28.↩
- The following paragraph constitutes NSC Action No. 1576. (Record of Actions by the National Security Council at its 289th Meeting, June 28, and approved by the President on June 29; Department of State, S/S–NSC (Miscellaneous) Files: Lot 66 D 95, NSC Records of Action)↩