Foreign Relations of the United States, 1977–1980, Volume IX, Arab-Israeli Dispute, August 1978–December 1980, Second, Revised Edition

252. Memorandum From William B. Quandt of the National Security Council Staff to the President’s Assistant for National Security Affairs (Brzezinski)¹

Washington, May 9, 1979

SUBJECT

• Middle East Initiatives (U)

You asked me to think of steps that might be taken to assert our commitment to the Egypt-Israel treaty and to the next stage of negotiations. It seems to me that we need to be clear concerning the target of our efforts. If we are trying to influence the Saudis, then public statements may be the wrong way to proceed. If we create an anti-Saudi mood in Congress, we may find that we have tied our own hands. If instead we are addressing a domestic audience, a different strategy is called for. (S)

Possible actions:

—If the Saudis are adamant in their refusal to fund the F–5Es for Egypt, we could publicly state the facts of the situation and request that Congress appropriate an additional $52.5 million to guarantee $525 million in FMS credits to cover the costs of the F–5E program. Simultaneously, to preempt negative Congressional action, we could say that the F–15 program is under review.

—Approach both the Saudis and Egyptians privately for a frank review of the dangers of letting their quarrel go further. Rather than taking sides, we would do our best to get them talking again.

—Background briefings attributed to “high Administration officials” that are critical of the Saudis and which are strongly supportive of Egypt, Israel, and the next phase of peace talks. Alternatively, an inspired Reston² column.

—Tell the Saudis to withdraw one of their diplomats [1 line not declassified].

—Public statements by the State Department spokesman, Secretary Vance, or the President. These have high visibility, but tend to reduce our flexibility.

—The Saudis are asking us to begin paying interest on the very large account they maintain with DOD. This is now being examined. There are several other areas in tax policy and other economic issues where the Saudis would like us to take positions favorable to them. It might be helpful for Mike Blumenthal or others to let the Saudis know quietly that we are simply unable to move on these issues in the present climate.³

—It might be possible to persuade some of Saudi Arabia’s newly found friends in Congress to talk to them privately or to write senior Saudis expressing their concern and indicating the high cost of maintaining a confrontational position. A campaign directed at Fred Dutton ⁴ might not hurt.⁵ (S)

RECOMMENDATION:

I see no merit in getting into a public argument with the Saudis. We can say things in private that would be counter-productive if said in public. After all, Sadat brought some of this on himself and we do not want our policy toward Saudi Arabia to be set by Egypt. (S)

If the Saudis refuse to pay for the F–5Es, I would consider the idea of seeking FMS credits to cover the cost (using the 10 percent guarantee route) and placing the F–15 program “under review.” I would then say nothing more in public about US-Saudi relations for a couple of months. (S)

1. Source: Carter Library, National Security Affairs, Brzezinski Material, Country File, Box 51, Middle East: 3–6/79. Secret. Sent for information. The top of the memorandum bears the stamped notation: “ZB has seen.” A copy of the memorandum was sent to Hoskinson.
2. Reference is to New York Times columnist James “Scotty” Reston.
3. Brzezinski placed a check-mark in the right-hand margin next to this paragraph.
4. Frederick G. Dutton, Assistant Secretary of State for Legislative Affairs from 1961 until 1964, served as a consultant to the Saudi Government. In telegram 3096 from Jidda, April 24, 1978, the Embassy reported that the Israeli newspaper Ma’ariv detailed that Dutton “recently admitted that he receives an annual salary of $200,000 from the Saudi Arabian Government. By his own admission, his sole task is to provide the Saudi Arabians with ‘evaluation’ of what is happening in Washington.” The Embassy added that “Dutton is active in the Treasury Department, as well as in other branches of the government, in trying to prevent legislation that would harm the oil companies or otherwise harm Saudi Arabia.” (National Archives, RG 59, Central Foreign Policy File, D780174–0346)
5. Brzezinski placed a check-mark in the right-hand margin next to this paragraph.