312. Telegram From the Embassy in Jordan to the Department of State1

777. Department pass Defense. Re Deptels 735,2 6663 and Embtel 708.4 Conveyed substance reftel Prime Minister Rifai who expressed keen disappointment, said proposed budgetary aid will in effect leave HKJ in position unable meet defense costs last two months of JFY 59. He pointed out British troops cannot remain Jordan much longer, not only because HKJ stated position re UN police force but even more so because domestic/political considerations wherein present regime is accused permitting reoccupation Jordan.

When UK forces depart HKJ must be able maintain internal/external security on its own. Rifai said it was this consideration which prompted King Hussein request expansion Jordan armed forces by two brigades. He said at loss understand how USG could be giving further consideration formation two additional brigades when it had already reached decision tantamount cut back existing troop strength. He said I am sure you appreciate present pro-Western government can only remain in power so long it has sufficient force maintain internal security. If we are compelled reduce below minimum required do job Jordan will be irretrievably lost free world, Western influence will soon be driven from entire ME, [Page 554] I explained that while my government appreciated Jordan courage nevertheless it felt HKJ should be able “prune back” certain expenditures which would enable it live within available US–UK support. Rifai assured me he would do everything possible achieve this and, at same time urgently requested I secure necessary authority provide much needed funds over step [Sept?] expenditures. He said he had meeting with King Hussein this afternoon, would advise him latest US decision but felt certain it would be bitter disappointment.

Comment: The relatively calm manner with which Rifai received bad news re US budgetary support can be interpreted two ways:

He feels confident when time comes USG will not stand idly by while HKJ faces army payless payday, at last moment will come through with enough money keep regime creaking along.
He has come conclusion hand-to-mouth operation no longer has “future”, may intend use current budget support pave way his own exit before aid runs out which on basis current spending will be some time January.

With USG limiting budget support for last seven months JFY 59 to absolute maximum $20 million (Deptel 735) budget situation for remainder JGY appears as follows to country team:

Budget Director will have to cut civil expenditures $5 million; however he says can finance remaining civil budget requirements entirely from domestic revenues plus UK development loan funds and POL counterpart, therefore can last out year (paragraph 9, Embtel 708). (This does not take into account any emergency civil requirements such as expediting desert road construction.) This would leave entire $20 million US budget aid for army.
ARMA believes roughly $4 million can be pared from army budget with no particularly damaging results to present establishment (see ARMA cables on Jordan army budget breakdown).5 However, army budget deficit of $5 million will remain, which can only be covered by cut in present military establishment.
In view necessity army be cut, does not make sense for USG to consider financing concurrent expansion of army by two brigades. Consideration should rather be given to maintaining and improving present military establishment, which rapidly deteriorating equipment-wise, using money to be allocated for additional brigades.
Country team notes by effecting above savings JFY 1959 expenditures will not exceed $77 million, or only $4 million more than last year’s actual budget undertakings. Country team therefore recommends that to satisfy budget requirements, enhance internal security, reaffirm political support for Jordan and effect psychological impact on Hussein and Rifai, USG make counter-proposal to HKJ request for additional brigades by offering $15 million additional budget support for remainder JFY 1959. This $15 million, along with $20 million available per Department telegram 666, would be used entirely for [Page 555] army, to cover maintenance present army establishment, some improvement equipment-wise, small expansion if any money left over. Since UK plan to create two new brigades “barefoot boys with rifles” is estimated to cost $10 million, country team proposal entails only $5 million additional support. Country team believes it would be tragic mistake to give Jordan $56 million, and for lack of another $5 million to court good possibility present government will collapse, allowing Nasser to enter game next spring with $5 million stake and win jackpot.
Above proposal does not take care of $7 million debt for military supplies carried over from last fiscal year. Failure to liquidate this debt has already seriously handicapped normal credit relationships in purchase army supplies. Package still needed by HKJ therefore totals $22 million.

Request authority execute agreement with HKJ committing $42 million budget support September through March 1959, including authority and provision to transfer $12 million immediately to cover $5 million needed for September and $7 million for last year’s unpaid army bills.6

  1. Source: Department of State, Central Files, 785.5–MSP/9–658. Secret; Priority; Limited Distribution.
  2. See footnote 4, Document 309.
  3. Document 301.
  4. Telegram 708 from Amman, August 31, contained an assessment of the Jordanian budget for fiscal year 1958 prepared by USOM, as well as the Embassy’s comments on the assessment. (Department of State, Central Files, 885.10/8–2158)
  5. Not found.
  6. The Department responded on September 12 in telegram 808 to Amman, which authorized the Embassy to obligate and transfer $5 million to Jordan for September, in accordance with prior instructions. The Department added, however, that no additional commitment could be made with respect to the Jordanian army budget. (Department of State, Central Files, 785.5–MSP/9–658) On September 13, Wright reported, in telegram 852 from Amman, that he had conveyed the substance of telegram 808 to Amman to Rifai. Rifai expressed appreciation for the continuing evidence of U.S. support, but noted that without a substantial increase in U.S. budgetary support the government would be without funds to meet army and civilian payrolls in December. (Ibid., 785.5–MSP/9–1358)