Foreign Relations of the United States, 1969–1976, Volume XXIV, Middle East Region and Arabian Peninsula, 1969–1972; Jordan, September 1970

9. Minutes of a Review Group Meeting¹

Washington, September 23, 1969, 2:10–3:15 p.m.

SUBJECT

• Middle East Water

PARTICIPATION

• Chairman—Henry A. Kissinger
• OEP—Haakon Lindjord
• State—William I. Cargo
• USIA—Frank Shakespeare
• —Rodger Davies
• BOB—James Schlesinger
• —Donald McHenry
• OST—Warren A. Hall
• Defense—G. Warren Nutter
• NSC Staff—Harold H. Saunders
• CIA—Edward Proctor
• Jeanne W. Davis
• JCS—LTG F. T. Unger

SUMMARY OF DECISIONS

—Mr. Saunders, in consultation with Mr. Cargo and others, will draft a memorandum for the President setting forth the four options:

• —proceed with the 40 MGD plant;
• —proceed with the 100 MGD plant;
• —cooperate in building a 15–20 MGD plant (both the 20 and 40 MGD plants would require construction of a small $5 million test module either in Israel or in the U.S. to test the new VTE technology);
• —do nothing.

The paper will discuss the pros and cons of each option and will reflect the Review Group discussion.²

Mr. Kissinger opened the meeting, commenting that the paper³ on this subject had grown from a Presidential request related to the Eisenhower–Strauss plan of 1967. However, we now faced an immediate operational problem in the necessity to take an Administration position on legislation now being marked up in the House Foreign Affairs Committee which would authorize up to $40 million in U.S. funds to build a 40 million gallon per day (MGD) desalting plant in Israel.⁴ As an operational problem, it might have been more appropriate for consideration by the Under Secretaries Committee rather than the Review Group, but he and Under Secretary Richardson had agreed to use the RG since they had already been convened for this meeting and because of related preparations for the U.S. visit of Israeli Prime Minister Golda Meir. Mr. Cargo, who was present at the meeting, could represent the State Department’s interests from the point of view of the Under Secretaries Committee.

Mr. Kissinger outlined the four options:

(1) proceed with the 40 MGD plant now before the HFAC;

(2) proceed with a larger (100 MGD) desalting plant studied in1965–68;

(3) offer to cooperate in building a 15–20 MGD desalting prototype plant in Israel using new technology (both the 40 MGD and 20MGD plants would require first testing a small module using new technology at a cost of approximately $5 million);

(4) do nothing.

He asked if it were agreed that we could eliminate the fourth alternative and discuss which of the three plans we should consider.

Mr. Nutter and General Unger demurred at eliminating the fourth alternative.

Mr. Schlesinger commented that the economics of the situation would not justify any of the plans and the research and development gains would be the only asset.

Mr. Cargo commented that State preferred the third alternative, although the foreign policy advantages are minimal since Israel puts a low priority on the desalting plant in relation to other projects. He and Mr. Davies thought any negative domestic reaction could be contained in view of this lower priority.

Mr. Kissinger asked if the 15–20 MGD option did not exist at the time the 40 MGD plant was chosen. He was told that was the case.

Mr. Schlesinger said the 40 MGD option is scaled down from the 100 MGD, Mr. Hall noted that the 15–20 MGD plant would use new technology, and Mr. Davies added that the 15–20 MGD plant would start with the small test module.

Mr. Kissinger asked why we could not get money for the 40 MGD plant when we could get it for the 15–20 MGD plant.

Messrs. Hall and Schlesinger pointed out that in fact we had no money for either project.

Mr. Saunders noted that the 40 MGD plant would be built from older technology and that the 15–20 MGD plant, which would begin with the test module, would be built around new technology with some R&D advantages.

Mr. Kissinger asked if Congress would be more willing to fund for R&D and why.

Mr. Schlesinger thought they would, since R&D had more pizzazz.

Mr. Kissinger asked which plant would be more useful.

Mr. Cargo thought that there would be a quicker R&D return from the smaller plant.

Mr. Saunders noted that we were dealing with semi-proved technology in the larger plant versus new technology in the smaller (15–20 MGD) plant.

Mr. Hall commented that the new technology was probably better technology.

Mr. Kissinger asked if that is what the Israelis want.

Mr. Saunders replied that Eshkol had agreed to the 40 MGD proposal.

Mr. Schlesinger said if it was a gift, Israel would take it. He noted two forces at work which had produced the 40 MGD plan: the Water for Peace program under President Johnson and the Eisenhower–Strauss plan, which President Nixon had supported during his campaign.

Mr. Kissinger asked what the urgency is.

Mr. Saunders replied that Israel faces a serious water problem and they are interested in desalting per se.

Mr. Shakespeare noted that the two items stressed in the exchange of letters between Johnson and Eshkol in January 1969 were desalting and provision of Phantom aircraft.⁵

Mr. Nutter and General Unger said Defense would prefer to defer any construction of any desalting facility for Israel until the Oak Ridge and the joint AID/Interior studies are completed, expected in late 1969.

Mr. Saunders noted that these studies will not contribute to an Israeli desalting activity. They are designed to consider how, if peace came to the Middle East, one could design a water system for the area which could contribute to area development. The only relationship between that and an Israeli facility would be if it were possible to make a large Israeli plant a stepping stone toward a broader area system.

Mr. Kissinger asked how much of a commitment exists.

Mr. Davies referred to the Johnson–Eshkol letters, in which President Johnson explicitly stated that he could not commit a successor Administration, and to the legislation submitted to the Congress embodying the 40 MGD proposal, and the proposed Rosenthal amendment to the Foreign Assistance Act which would authorize a $40 million contribution for building the 40 MGD plant.

Mr. Saunders noted that there had been oral exchanges between the U.S. and Israel prior to the exchange of letters.

Mr. Davies commented that we could explain any delay in the project on the basis of other Israeli priorities.

Mr. Kissinger asked if there was a consensus that if we agree to go ahead we should emphasize the smaller plant, and that any decision should consider three elements: improvement of technology; foreign policy reasons; and the nature of our commitment.

Mr. Saunders noted that technological development will proceed separately from the Middle East question.

Mr. Schlesinger suggested another alternative: that the Interior Department be given $5 million to build the test module in the U.S. He thought Interior would prefer this course but that the funds had not been included in the FY 70 budget.

Mr. Hall noted that this step could be used as a basis for deferral of construction in Israel, with the argument that when the Israeli project is implemented, it should be on the basis of the best technology.

Mr. Kissinger asked how many years this would take.

Mr. Hall thought if the test module were funded in FY 71, we should know in two or three years whether we could do it or not, with emphasis on the new vertical tube evaporator (VTE) technique.

Mr. Shakespeare said that if it was agreed that desalinization was important and we could learn something from building at least the $5 million test module, was it not well worth the relatively minor sum of $5 million?

Mr. Hall said that if we considered this solely in its U.S. context— as a problem to be solved for the U.S.—we should relate the timing of the construction and testing of facilities, hence, the provision of funds, to the expected time of need in the U.S.

Mr. Kissinger noted that the same relation existed if the funds were spent in Israel.

Mr. Hall agreed that if we build the facility in Israel we will certainly get some technical advantage from it. The question was whether it would be worth it in U.S. terms. Was it necessary to proceed now in budgetary terms? He thought it would take three years from the time funds are appropriated to completion of the test module.

He was looking ahead ten years to the areas in which the U.S. might need water produced by desalinization. He could not see such a requirement in ten years at the present time, but he acknowledged that the situation could change rapidly.

Mr. Saunders pointed out that Israel has such a requirement now.

Mr. Schlesinger noted that Israel was unwilling to divert water from agricultural purposes, where the cost of the water as compared to the agricultural yield was in terms of a factor of 4. He said that Israel needed reallocation of its water to urban and industrial purposes.

Mr. Davies asked if Israel could then be expected to obtain its vegetables and other agricultural products from its Arab neighbors.

Mr. Proctor asked if we went ahead with construction of the 20 MGD plant would we be likely to end with a white elephant on our hands?⁶

Mr. Hall noted that with the expenditure of $5 million for testing of the new VTE technique, it might be possible eventually to obtain a 25% or even 50% improvement in the price of desalted water. He briefly traced the development of the new concept of water provision since 1964, compared the use of distilled water to water produced by the reverse osmosis technique, and commented that the relationship of water cost to yield in Israel might be reduced to a factor of 2 or 3. He pointed out that desalted water was an entirely different product from any agricultural water now in use. In general, he agreed with the Budget Bureau on the present situation.

Mr. Kissinger noted that it appeared completion of the big study would not add to solution of the Israeli problem.

Mr. Nutter again raised the question of where the plant should be located, noting Israel’s attacks on the East Ghor Canal. He questioned the symbolic significance of our helping Israel with its water problem while Israel attacks water facilities of its neighbors.

Mr. Kissinger asked if the Israelis are likely to raise the issue of the desalting plant during the Golda Meir visit.⁷

Mr. Saunders replied we didn’t know; that Mrs. Meir has many other things on her mind.

Mr. Davies noted that the emphasis had been on economic questions, including extension of credits, etc.

Mr. Kissinger asked how much pressure is behind the legislation.

Mr. Davies replied that the U.S. was committed in the eyes of many members of the Congress.

Mr. Shakespeare asked where Senator Baker stood on this issue.

Mr. Davies replied that Senator Baker backs the regional approach and opposes the Israeli plant because it is not demonstrably and directly linked to the regional approach.⁸

Mr. Kissinger thought that we should look at the problem on a regional basis and from the point of view of U.S. evenhandedness in the Arab-Israel situation.

Mr. Saunders commented that the proposed plant would meet considerably less than Israel’s requirement, and that the purpose of the larger study was to develop a regional scheme and provide evidence of an evenhanded U.S. policy.

Mr. Davies noted that this could be tied to refugee resettlement, for example.

General Unger asked if the smaller plant would be nuclear.

Mr. Hall replied no, that it would not be economically feasible.

Mr. Kissinger asked if the 15–20 MGD plant would be nuclear.

Mr. Hall replied no, adding that the source of power has nothing to do with when or where the plant is built.

Mr. Kissinger asked if Israel would be aided in solving its problem by completion of the regional study.

Mr. Nutter replied that they would.

General Unger asked if Israel could opt for a nuclear power source.

Mr. Hall replied that they could theoretically, since the source of power was left to the Israelis to decide.

Mr. Schlesinger pointed out, however, that the U.S. would have to finance any nuclear power installation.

Mr. Cargo commented that State would be prepared to go ahead with construction of the 15–20 MGD plant, preceded by the test module. He noted an AID memorandum which opposes the proposed Rosenthal amendment to the Foreign Assistance Act to provide the $40 million grant to Israel to build the 40 MGD plant, and favors authorizing Interior to build the small experimental plant in the U.S., with the collaboration of Israeli and other foreign scientists, and to promise to help Israel in installing the ultimately improved technology there. He thought AID would join State in their willingness to go ahead with the test module in Israel if their concerns about the source of the financing could be met.

Mr. Kissinger summarized the pro arguments for the 40 MGD plant as: (1) the commitment in the Johnson letter; (2) the relationship to other political objectives (which Mr. Cargo commented would be minimal); and (3) improved technology, which could be achieved even more efficiently through construction of the $5 million test module.

Mr. Hall noted that it would still be better if the experimental plant were built in the U.S.

Mr. Kissinger asked what would happen if we should decide to do nothing.

Mr. Saunders replied that we would tell the Israelis that we want to defer further action on this project and would persuade interested Congressmen not to push the proposed legislation.

Mr. Davies noted it would not be too difficult to turn Congress around in view of the relatively low priority which Israel placed on this installation.

Mr. Kissinger thought we should wait and see what Golda Meir says and see how we might relate this issue to a settlement in the Middle East.

Mr. Shakespeare agreed that this should only be done as part of a general settlement, but noted that water had become a highly emotional issue and one that had a good deal of public sex appeal.

Mr. Davies pointed out that the Interior Department considered the water problem of great concern to the U.S.

Mr. Hall noted, however, that Interior had a very restricted budget for water problems and he doubted if they would be willing to take the $5 million required for the test module out of their present budget.

Mr. Hall reviewed the time table: from the time when we perceive the need in the U.S., it will take five years to develop the capability, plus three years on the test module to see whether the new technique will work. The question to be answered is whether we have any spots in the U.S. where we will need to apply such a capability in the next ten years. The alternative would be to push ahead with our research and to try to develop an even better technology.

Mr. Saunders again noted that the need exists in Israel now, and that the proposed activity would advance our research.

Mr. Kissinger asked Mr. Saunders, in consultation with Mr. Cargo and others, to prepare a paper for the President reflecting this discussion. He saw no need to await the results of the general study, since the President would decide how urgent the matter is on the basis of this paper. The paper should discuss the pros and cons of the plan, taking into account the nature of our commitment, the technological assets we would gain, and the things we may ask Israel to do.

Mr. Cargo expressed his view that we should go ahead as fast as possible in advancing our water technology for basic U.S. foreign policy purposes. He cited conditions in Pakistan and elsewhere with hundreds of miles of coast line but with very little or no fresh water.

Mr. Kissinger commented that water technology was likely to be pushed faster in Israel than anywhere else to which Mr. Cargo agreed.

Mr. Schlesinger commented that almost any R&D which would bring down the cost of water would be an advance.

Mr. Proctor compared a five-year program at $5 million to a more expensive program which would take 10–15 years.

Mr. Hall noted the relationship between funds and ideas. He said ideas develop sequentially—one idea suggests the next one. In this context, a large program would be repetitive and might well exceed the threshold of economic feasibility.

Mr. Kissinger closed the meeting with the comment that we needed a U.S. national policy on desalting.

1. Source: National Archives, Nixon Presidential Materials, NSC Files, NSC Institutional Files (H-Files), Box H–111, Senior Review Group, SRG Minutes Originals 1969. Secret; Exdis. The meeting took place in the White House Situation Room. The minutes were reviewed and approved by Kissinger. (Memorandum from Davis to Kissinger, September 25; ibid.) Prior to the Review Group meeting, Saunders prepared Talking Points and a Draft Issues Paper for Kissinger to send to Nixon. Saunders then recommended the Basic Paper, “Desalting in the Middle East,” to Kissinger. (Memorandum from Saunders to Kissinger, September 17; ibid., Box H–039, Review Group Mid-East Water 9/23/69)
2. Printed as Document 12.
3. A reference to “Desalting in the Middle East,” undated, referred to as the Basic Paper. (National Archives, Nixon Presidential Materials, NSC Files, NSC Institutional Files (H-Files), Box H–039, Review Group Mid-East Water 9/23/69) It was a summary of two longer papers: “Proposed 40 Million Gallon Per Day Desalting Plant in Israel” and “The Potential for Large Scale Desalting in the Middle East.” (Ibid.) Sisco, as acting Chairman of the Interdepartmental Group, sent it to Kissinger on September 9 (ibid.) and it was transmitted to members of the SRG from Davis under a September 12 covering memorandum. (Ibid., Box H–141, National Security Study Memoranda, NSSM 30)
4. The issue was raised in a memorandum from Hannah to Kissinger, September 18. (Ibid.)
5. See footnote 3, Document 4.
6. According to a September 18 memorandum, the CIA regarded it as “inconceivable [that] the Arabs and Israelis would cooperate on any desalting projects in the Near East for some time to come.” The CIA therefore thought it was premature to consider large-scale desalting projects in the Eisenhower–Strauss context, but thought it worthwhile to proceed unilaterally with desalting projects for Israel. (Central Intelligence Agency, ORR Files, Job 80–T01315A, Box 19)
7. Israeli Prime Minister Golda Meir made a two-day official visit to Washington September 25 and 26, during which time she met privately with Nixon. The issue of desalination did not come up in conversations between Rabin with either Rogers or Kissinger, nor in Meir’s conversation with Rogers. The September 26 memorandum of conversation and telegram 163837 to Tel Aviv, September 26, are scheduled for publication in Foreign Relations, 1969–1976, volume XXIII, Arab-Israeli Dispute, 1969–1972.
8. See footnote 2, Document 4.