Foreign Relations of the United States, 1955–1957, Suez Crisis, July 26–December 31, 1956, Volume XVI

68. Memorandum From the Secretary of Defense (Wilson) to the Executive Secretary of the National Security Council(Lay)¹

Washington, August 7, 1956.

SUBJECT

• Nationalization of the Suez Canal; Consequences and Possible Related Reactions

REFERENCE

• Memo for the Executive Secretary, NSC, from the Deputy Secretary of Defense, subject: “Nationalization of the Suez Maritime Canal Company by the Egyptian Government”, dated 2 August 1956²

1. Forwarded herewith for the information of the members of the National Security Council are certain views of the Joint Chiefs of Staff regarding the above subject additional to those transmitted by the reference memorandum. I believe these views can be helpful in connection with the discussion of the item at the Council meeting on Thursday, 9 August 1956.

2. I am requesting the Chairman of the Joint Chiefs of Staff to be prepared to give the Council on Thursday the benefit of any additional information which may be developed by that time as a result of the study being made by the JCS, as indicated in paragraph 6 of their memorandum.

C. E. Wilson³

[Attachment]

Memorandum From the Joint Chiefs of Staff to the Secretary of Defense (Wilson)⁴

Washington, August 3, 1956

SUBJECT

• Nationalization of the Suez Canal; Consequences and Possible Related Reactions

1. In furtherance of the views expressed by the Joint Chiefs of Staff in their memorandum for you dated 31 July 1956 concerning the expropriation of the Suez Canal by Nasser, the Joint Chiefs of Staff are becoming increasingly concerned about the possible future consequences to the United States should Nasser’s venture be successful.

2. At first examination the nationalization of the Suez Canal might appear to be a matter of primary and vital importance to the United Kingdom and France, but only of secondary and indirect importance to the United States. However, in the opinion of the Joint Chiefs of Staff, if Nasser’s expropriation and nationalization of the Suez Canal are permitted to stand, related reactions may well develop which will jeopardize U.S. military, political and economic interests throughout the world.

3. The following are among the possibilities which can be anticipated:

a. That Nasser would become so strong a spokesman and symbol of Arab nationalism that he would be able completely to unite and dominate the Arab world from Morocco to Iraq.

b. Nasser’s influence as leader of the Arab world, if unchecked, could react in a manner inimical to U.S. interests in all Moslem countries and in neutralist and under-developed countries throughout the world.

c. Nasser would be in an improved position to play off the West against the USSR, and in so doing probably could not avoid entering into relationships with the Soviet Union which would substantially enhance the position of the USSR in the Middle East, Asia, and Africa. An ancillary result of these developments would be to increase the likelihood of open Arab-Israeli hostilities.

d. As Nasser’s influence spreads it may be anticipated that other Arab States initially, and subsequently other nations, will use his successful act of nationalization as justification for themselves expropriating and nationalizing U.S. and Western enterprises, with little fear of the possible consequences of their acts. Additional steps in the field of nationalization/expropriation may include the following, each of which could have major military implications:

(1) Syria, Lebanon, Jordan—pipelines.

(2) Iraq, Saudi Arabia—all POL facilities.

(3) Persian Gulf and Trucial Coast States—all POL facilities.

(4) Persian Gulf and Trucial Coast States—complete rejection (and ejection) of U.K. control, guidance and influence.

In connection with above, it should be noted that concessions to the USSR on the part of the nations concerned would be a logical corollary to the acts of expropriation. Were these granted, the result would be an acceleration of Soviet expansion and a consolidation of Soviet power throughout the Middle East.

4. The resultant decrease in Western prestige, should the foregoing occur, could result in the loss of U.S. bases in the Middle East and North Africa and ultimately in other areas such as Iceland, the Phillipine Republic, Spain, and the Azores.

5. Without at this time suggesting a specific solution to the problem posed above, the Joint Chiefs of Staff wish to bring to the attention of the Secretary of Defense the possible and even probable repercussions which could result from permitting the ascendancy of Nasser as a “champion of Arab nationalism”. The Joint Chiefs of Staff also desire to point out that if Nasser’s action is profitable to him or to Egypt and if subsequent events of similar nature occur, the United States will find it necessary to take active steps to change the course of events. By such time the cumulative problem could be vastly greater than today.

6. The Joint Chiefs of Staff are presently making a study of the problems arising from the nationalization of the Suez Maritime Canal Company. This study will include an analysis of possible military courses of action and their consequences in the event that political and economic measures fail to achieve a timely and acceptable solution. Although a copy of this study will be forwarded to the Secretary of Defense upon completion, this memorandum is considered of sufficient importance to warrant prior submission.

7. The Chairman, Joint Chiefs of Staff, did not participate in the action of the Joint Chiefs of Staff outlined in this memorandum.

For the Joint Chiefs of Staff:

Maxwell D. Taylor⁵
General, United States Army Chief of Staff

1. Source: Department of State, S/S–NSC (Miscellaneous) Files: Lot 66 D 95, Suez Canal Situation. Top Secret. Lay transmitted the memorandum and its attachment to members of the National Security Council for their information under cover of a memorandum dated August 7, not printed. (Ibid.)
2. Document 50.
3. Printed from a copy that bears this typed signature.

4. Top Secret. On August 8, during a telephone conversation between Dillon Anderson and Secretary Dulles, the following exchange took place regarding this memorandum:

   “A. said in briefing the Pres. for tomorrow he brought in the JCS letter of the 3rd which Gray showed the Sec. Saturday [August 4]. The Sec. thought it was the same as the other. A. said it goes into political considerations—and would not be so, he does not think, if Radford were here. A. told the Pres. it seemed to go far. The Pres. said in the Council he welcomes any thought anybody has, but in the main he looks to the Sec. for judgment in political matters and to the military for various consequences.” (Memorandum of telephone conversation by Bernau, 10:27 a.m., August 8; Eisenhower Library, Dulles Papers, White House Telephone Conversations)

5. Printed from a copy that bears this typed signature.