204. Telegram From the Embassy in the United Arab Republic to the Department of State1

2746.

[Here follow sections A and B in which Hare presented general observations on the situation in the Middle East and the situation in the UAR.]

C. Policy recommendations. As regards policy which we should follow in this situation, I am in essential agreement with thoughtful analysis of Ambassador Yost in his valedictory despatch No. 379 of March 20, 1958,2 substance of which, in fact, we discussed together when Ambassador visited Cairo a short time before. In short, Ambassador Yost suggested that four alternatives of trying to, bring Nasser down, keeping him in deep-freeze, giving him all-out support or following policy of live and let live, the last, although far from ideal, would seem be best bet at present time. Also, it would seem to be in general agreement with proposals set forth in Deptel 2602, March 25,3 for progressive steps toward normalizing our relations with UAR, and to harmonize with suggestions which I endeavored set forth in first part of this telegram. It is also, I believe, best policy position from which to be able maneuver regardless of such turns as events may take.

Assuming, therefore, that there seems to be a basic concensus regarding policy line which we are prepared to take in respect of UAR, following are certain observations concerning factors which might be considered in its implementation:

1.
We should realize from start that, by virtue of Arab revolution being what it is, we may be able to reduce distance between US and its leaders but we will never really get together except on specific points for limited periods. We just are not tuned to same wave-lengths and should not be surprised if our efforts at rapprochement result in continuing misunderstanding, perhaps at very times we are doing our best be helpful.
2.
We should avoid over-formalizing what is essentially a pragmatic approach. In first place, to attempt do so would be to ignore unstable fabric of material with which we have to work and also instinctive Arab aversion to legalistic engagements as contrasted with informal and unpublicized agreements which are quite congruous with [Page 442]their mental processes. In second place, it would be contrary to mentality of Arabs who are essentially bazaar traders, not big businessmen. If you are going to try to sell a big idea to an Arab, you have to do so bit by bit; he has little concept of large-scale forward planning.
3.

It follows from foregoing that we should not be squeamish about making deals, or to use a naughty phrase “to attach strings.” It isn’t strings per se that worry Arabs but merely pressures which would put them in vulnerable position in respect of nationalist movement, world power struggle and Israel. It’s vulnerability, not strings, that bother them.

Corollary of this is that gratitude is not an Arab characteristic. There is no point whatsoever in acts of generosity for generosity’s sake in anticipation of grateful recognition.

4.

If gratitude is not an Arab quality, this does not mean that they do not have psychological susceptibilities to be exploited and first among these is receptivity to deference to their ego. Nasser himself is a good example. He frankly admits that he has complexes and frequent recurrence of word “dignity”, in his speeches is an indication that he feels this is also a mass phenomenon. When he tells his people that “we now have dignity”, he is playing what he believes, and rightly, to be his trump card.

The problem here, of course, is how to massage his ego and not over-inflate it. One way is to do what we already have in mind by removing restrictions on normal intercourse. Next step would, hopefully, be to find means to unfreeze Egypt’s frozen balances which are unquestionably greatest generators of bad blood in our current relations, not because of economic importance but precisely because freezing regarded as denigration of Egypt’s dignity.

As regards positive measures along this line, expedient of confidential consultation could be very effective and also it is to be hoped that relations might be brought to a point where senior officials of USG might again include Cairo on trips to area since it is, of course, no secret that obvious (and intentional) way in which Cairo has been bypassed during past several years has rankled here. Equally indicative has been cordial reception accorded such persons as Eugene Black, General Wheeler and Congressmen who have come this way. Ideally, of course, ultimate objective would be visit by Nasser to US and this is idea which should be kept constantly in mind despite obvious factors militating against so doing at present.

5.

Although policy of return to normalcy in relations with UAR would foreseeably involve certain expenditures or funds, it need not follow that actual price tag in terms of dollars and cents would necessarily be very high. What Egyptians would really prefer is not be given direct assistance but rather to sell their cotton and meet their needs [Page 443]with proceeds. This is formula which Russians have used successfully. Naturally there are limitations on what we can do by way of cotton purchase but I believe we could, if we would, make a great contribution if we would make difficult decision of fixing our cotton export and import policy more in accord with our over-all national interest than is now the case. If we could do something along that line, our relations with Egypt could be transformed over night. Similarly, I imagine that Egyptians would be interested in any action which we might sponsor or support to regularize world cotton market by some form of international agreement such as has been done in past for other commodities.

However, there is no gainsaying fact that cotton will probably remain a headache and that we shall have to seek elsewhere for more effective expedients. These do exist in form of low interest loans from such sources as IBRD, Export-Import Bank and Development Loan fund (where we should be competitors with Russians but have more latitude than in cotton); private investment (an open field that only needs reestablished confidence to stimulate); encouragement of tourism (we could make real killing if we could make public gesture in this field); maintenance of present assets such as American educational institutions, TWA, Ford, Hilton Hotels, American Export, Namru, et cetera. (That Egyptians want very much see these maintained was recently evidenced in providing foreign exchange to both TWA and Hilton despite their exchange stringency.)

I wish repeat that it is important bear in mind that “dignity” in Egyptian eyes has economic as well as political implications and that best form of economic “aid” would be one in which we could deal with them as equals in mutually profitable enterprises rather than putting emphasis on grant aid and technical assistance. There are, however, several notable exceptions to this generalization, i.e. PL 480 wheat (which has especial appeal because of shortage of foreign exchange but which, if given, should best be treated, as in case of Poland, as sale rather than aid) CARE (which, although act of charity, seems be acceptable because of being regarded as a means of assisting Government in its up-hill task of alleviating lot of people); EARIS (because of its bearing on all-important overpopulation problem). Also despite unhappy memories of Aswan Dam, we should continue bear in mind that some form of Nile Valley development remains essential and that there may still be some way in which we may be able associate ourselves appropriately with it, as was in fact adumbrated by Secretary in his July 19, 1956 statement.4

[Page 444]

Incidentally, one of greatest feathers that could be put on the American hat here would be if the Sahara Petroleum Company could have good fortune to hit oil on western desert. It would be better than millions in grant aid.

6.
Another field in which we can and should develop our relations is the cultural. For some reason, Egyptians seem feel that there is some sort of dividing line between political and related informational activity and cultural activity, such as exhibits, libraries (our USIS library did land office business during darkest days here), exchange of persons, athletic competitions, entertainment, etc.
7.
Statements by responsible persons, especially highly placed officials, which are calculated to fall on receptive ears in given circumstances are very useful if properly timed and phrased. In particular, it should be emphasized that it is not enough to make a statement on a given subject and then just stand on it. Repetition is necessary and it should be remembered that it isn’t often so important exactly what is said as it is to say something at a particular moment.
8.
As regards economic aid itself, I would be inclined, except for CARE, EARIS and PL 480 wheat as previously mentioned and road building machinery as mentioned in Deptel 2602, to keep it more or less in background as sort of reserve force rather than using as principal element in first phases of the campaign because, strange as it may seem to us, Nasser and those thinking like him (including Fawzi; probably one of few subjects on which they are in agreement) tend to be repelled by idea of grant economic aid in principle and one of things about which they are especially proud in their Sovier relationship is that they are paying their own way. What we should always remember is that the most effective coin here is one which meets the requirements of “dignity”. That is why loans, private investment (particularly of joint venture or management type), removal of trade barriers and similar action is recommended in preference to overt aid. However, in certain circumstances aid can play role and, aside from items mentioned above, it is capability to be maintained and used as found appropriate. Unfortunate example of the Aswan Dam is nevertheless good example of aid of type which need was felt, although I am not at all sure that in that case very low or non-interest bearing loan of long term would not have been preferable to outright grant. In fact, if I may digress for moment, I have never understood why we have not been able satisfactorily to bridge gap between fairly high interest loans and outright giving. Why not give interest and keep principal? Of course, it may cost us just about as much in end, but psychologically I believe that it is still better to lend than give, with due allowance, of course, for exceptions in given circumstances.
9.
Soviet bloc now has such monopoly on supply of military equipment to both Egyptian and Syrian elements of UAR that it is difficult see much opportunity for our getting into that field even if there were possibility of favorable political determination to that effect. However, to extent that it has importance, I see no reason for continuing to withhold spare parts for such things as American Jeeps and transport aircraft or to furnishing non-lethal military items, especially for transport purposes. I should also suggest that we would be well advised to consider receiving certain number of UAR officers in US in event that there is UAR interest. It seems doubtful that demand would be great because, as was to be expected supplying of Soviet bloc arms has led to large-scale training in their use and also in Soviet military organization. However, it is conceivable that UAR might wish to have few officers trained in US if for no other reason than for comparative training intelligence and, if they do, we might well be receptive. In fact, we have received nibbles to that effect as late as April 3 from acting Chief of Staff of UAR Army following previous approaches from Navy.
10.
As regards counteracting Soviet bloc penetration, my suggestion is that we should “compete without competing.” By this I mean that we should primarily direct our attention to fields where we have capabilities which Soviets and their satellites would find it difficult to match and steer clear of fields where they have advantage, and in this connection I would especially invite attention to fact that, despite strides which state economic socialism has made in Egypt, private enterprise still remains deeply rooted and is even viewed with sort of schizophrenic favor by government. However, in suggesting that emphasis should be placed on these non-competitive types of endeavor, I would not in any sense wish to imply that we should abandon more competitive fields entirely to Soviet bloc. In cases where we are able to meet them on more or less equal terms, we should not hesitate to move in energetically. What we should avoid is appearing to compete in areas where we would cut comparatively sorry figure.
11.
In same way that we seek assistance of allies in basic East-West conflict, we should do same in Middle East but perhaps with somewhat modified approach. British are, of course, old stalwarts in this connection. West Germans are more or less newcomers but carry quite a punch. French are best forgotten. Italians can help some; Greeks less. Of Baghdad Pact countries, Turks would be potentially most helpful with Pakistanis rather poor second. Some of independent African countries could assist to limited degree and in certain areas Yugoslavs could lend hand despite their addiction to neutralism. Indians are real force here and, aside from neutralism and anti-pactomania, have many interests in common with US in both UAR and Middle East which could and should be more purposefully coordinated [Page 446]Japanese are active but it is still difficult assess their ultimate objectives aside from fostering trade. Given different political complexions of countries mentioned, it is obvious that any over-all plan for collaboration would be impractical but consciously pursued ad hoc approach could have very measurable constructive results.

[Numbered paragraph 12 (15 lines of source text) not declassified]

[7 lines of source text not declassified] I would have no thought of protecting Nasser and UAR from valid criticism nor of refraining from resort to legitimate defense when Cairo press or voice of Arabs on rampage. In such circumstances there should be prompt and vigorous counteraction, but what I do feel to be ill-advised is resort to snide attacks or ineffectual half-measures which only stimulate already rabid nationalism to greater excesses.

[Here follows section D in which Hare summarized his views.]5

Hare
  1. Source: Department of State, Central Files, 786.00/4–1658. Secret. Repeated to London, Moscow, Amman, Ankara, Baghdad, Beirut, Damascus, Jidda, Khartoum, Paris, Rome, and Tripoli.
  2. Not printed.
  3. Document 202.
  4. Presumably a reference to Press Release No. 401. For text, see Department of State Bulletin, July 30, 1956, p. 188.
  5. On April 19, the Department of State replied that Hare’s views fit in “well” with its own views and the analysis set forth in Section C would be kept clearly in mind. (Telegram 2888 to Cairo; Department of State, Central Files, 786.00/6–1658)