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 | FOREIGN RELATIONS OF THE UNITED STATES 1964-1968, Volume XVIII Arab-Israeli Dispute, 1964-67 Department of State |
 400. Record of Meeting of the Interdepartmental Regional Group for Near East and South Asia/1/ IRG/NEA 67-11 Washington, March 28, 1967. /1/Source: Johnson Library, National Security File, Files of Harold Saunders, Israel-Arms. Secret. Prepared on March 29 by Sidney Sober, Staff Director. In considering our policy on the supply of arms to the Near East, and certain pending requests from the Government of Israel and the Government of Lebanon for the supply of arms, the Group: Recalled our hope that a plateau in Near East arms supply had been reached about a year ago after we had concluded arms sales to certain Near East countries, and our hope that a sustained pause in the further supply of arms to the area could be maintained; noted that meanwhile the Soviet Union had continued to ship arms to certain countries in the Near East, and that soundings we had taken with the Soviet Union on the possibility of an arrangement with it on the control of arms shipments to the Near East had been negative; and agreed that the Soviet Union probably continued to see advantages in its military relationship with certain Near East countries, and that there was no evidence that the Soviet Union would be interested at this time in an understanding with Western suppliers on controlling arms shipments to the area. Noted that our arms policy toward the area is aimed at, and is affected by, not only the Arab-Israeli confrontation but also the relations between the so-called "progressive" Arab states (e.g., UAR, Syria, Iraq) and the more traditional Arab states (e.g., Saudi Arabia, Jordan), as well as the prospects for internal stability in certain of the Arab countries which are friendly to us (e.g., Jordan, Lebanon); noted that urgent considerations arising out of the Israeli attack on Samu in November 1966 had most recently caused us to agree to provide certain additional military equipment to Jordan; noted also that there is a direct relationship between our policy on arms for the Arab states and Israel and our policy on arms for Iran, given the Shah's concern over the threat he sees from Nasser; and noted finally that, when it is consistent with our broad foreign policy objectives, we have a balance-of-payments interest in selling arms to certain buyers. Agreed that our interests would be best served by the maintenance of only such military forces and capabilities in the area as would deter the outbreak of hostilities between the Arab states and Israel, and/or among the Arab states themselves. The Group agreed that a drastic reduction--if not a complete moratorium--on imports of arms into the area would be desirable, not only to help maintain peace but also to permit countries in the region to devote maximum resources to internal economic and social development; and agreed that it remains particularly important to avoid the introduction into the area of sophisticated new types of weapons systems, including nuclear weapons. The Group agreed, furthermore, that Soviet cooperation is essential for effective arms control in the Near East and that we should continue to explore on all appropriate occasions the possibilities of an understanding with the Soviet Union on this subject; and that an effective understanding would also require the cooperation of various other European countries (e.g., the United Kingdom, France, the Federal Republic of Germany, and Italy, as well as Czechoslovakia). The Group agreed that, while working toward our long-run objective of effective arms control for the area, we should continue to exercise maximum restraint in supplying arms to countries in the Near East. Given our current lack of control over other external sources of arms for the area, we must retain the flexibility to supply arms selectively so as to help maintain an equilibrium that may deter an outbreak of hostilities. As regards the Arab-Israeli confrontation, despite Soviet shipments to the Arabs we should avoid becoming involved as the major supplier of arms to Israel and should encourage the Government of Israel to look generally to Western European suppliers for arms needed to maintain an effective defense against Arab forces. The Group also agreed that, within a general policy of maximum restraint, it may also continue to be desirable for us to supply limited quantities and types of arms to help friendly countries in the area to maintain internal security and political stability; but that the supply of arms in such cases should be decided upon only with full consideration of the aim to avoid an escalation of the arms race and to maintain peace in the area. Israel In considering the pending request of the Government of Israel for (1) the grant of 200 armored personnel carriers (APC's--Model M-113 A1) valued at approximately $7.4 million, (2) the grant of tank parts valued at $2 million, and (3) the supply on soft concessional credit terms of follow-on Hawk missile spares and M-48 tank parts valued at $14 million, the Group: Agreed that Israel does not have a valid military requirement at this time for the APC's; that, in any event, the recency of Israel's attack on Samu (Jordan) made it undesirable for us to accede at this time to the supply of new weapons; that the supply of improved new APC's of the M-113 A1 type would tend to escalate the Near East arms race; and that if Israel were adamant about obtaining new APC's, our own interests dictated that the United States should not be directly involved. Reaffirmed that we should maintain our established policy against supplying grant military aid to Israel and that we should reject the Government of Israel's request of grant aid for APC's and tank parts. The Group agreed, furthermore, that we should refuse to sell Israel the M-113 A1's or to agree to the sale of the similar U.S.-licensed, Italian-made Model M-113, for either credit or cash; and should the Government of Israel ask to purchase our APC's, we should encourage it to look to other sources in Western Europe for equipment. The Group also reaffirmed its view that it would set an undesirable precedent to provide credit for Israel for the purchase of follow-on military spares and parts. The Group agreed, however, that if it should be determined that some concession on military supply should be made to Israel, a credit in the range of $7-10 million might be offered at the current going rate (5 1/2% interest, 7 years, 10% down payment) for the purchase of spares and parts. Lebanon On the Lebanese request for M-48 tanks,/2/ the Group: /2/Documentation on U.S.-Lebanese discussions concerning possible U.S. arms sales to Lebanon is in the National Archives and Records Administration, RG 59, Central Files 1964-66 and 1967-69, DEF 12-5 LEB and DEF 19-8 US-LEB. Noted that a Lebanese request for tanks had been made more than a year ago; that we had recently made Lebanon an offer, pursuant to a long-standing request, to supply two Hawk missile batteries on concessional credit terms, and that our offer was now before the Government of Lebanon for decision; and that the prospects of funds for additional military purchases by Lebanon have been adversely affected by Lebanon's commitment to purchase fighter aircraft from France, the probability that no further funds will be available from the United Arab Command, and conflicting budget demands in Lebanon. The Group also noted the importance attached by the Government of Lebanon to the purchase of tanks, the importance of continued support by the Lebanese armed forces to the stability of the moderate government of President Helou, the fact that we have not supplied any military equipment--apart from a few recoilless rifles--to Lebanon for several years, and the desirability of maintaining some U.S. military tie to Lebanon. The Group agreed that, because of the various factors noted above and because of the relatively small size of the proposal in question, that our agreement to supply a limited number of M-48 tanks to Lebanon would not be inconsistent with our broader policy on the supply of arms to the Near East and would not constitute a major factor in accelerating the arms race; and agreed that we could now offer to sell up to 35 M-48 tanks to Lebanon, together with necessary support spares and basic load ammunition. Lead time on delivery of the tanks is estimated at 24 months, and the estimated cost of the entire package is $4.25 million. The Group agreed that no further financial accommodation should be offered to Lebanon beyond the amount of concessional credit already contemplated for the supply of Hawks, and that the burden of any decision on procurement as between Hawks and tanks should be left to the Government of Lebanon; if part of the contemplated credit is not used for the Hawks, it could be applied to the sale of tanks. [Here follows a list of members present, including Acting Executive Chairman Battle, Hoopes, Saunders, Williams of AID, Critchfield of CIA, Brigadier General Sibley of the JCS Staff, and Nevins of USIA. Others present included Handley, Davies, Wolle, Kitchen, Colonel Jordan, and Sober.] SS
401. Memorandum From the President's Special Assistant (Rostow) to President Johnson/1/ Washington, April 7, 1967. /1/Source: Johnson Library, National Security File, Country File, Israel, Israeli Aid, 5/67. Secret; Sensitive. Received at 7:30 p.m. Rostow's handwritten note on the memorandum reads: "Howard & Hal: Hold--but for your guidance. Walt." None of the approval or disapproval lines is checked, but handwritten numbers appear in the margin. A table dated April 18, attached to Document 406, shows the President's initial decisions, which accord with the marginal notations. (Johnson Library, National Security File, Country File, Israel, Vol. VI) For his final decisions, see footnote 6, Document 416. SUBJECT State and Defense now agree on a package./2/ It doesn't give the Israelis everything they asked for and runs lower than last year. However, on all but one item, I think they'd have to admit we've been as responsive as possible given our limitations. /2/An April 4 memorandum from Katzenbach to the President with the recommendations summarized here is attached. Katzenbach recommends about $48 million (Israel's requests total $76 million). We've tried to be as generous as possible in balance of payments type aid because Eshkol faces unemployment after deliberately slowing economic growth to shake out uncompetitive industry, narrow Israel's trade imbalance and get ready for association with the Common Market. The package includes: --$23.5 million in PL 480 (feedgrains, oil, maybe tobacco, no wheat). Agriculture is thinking of 75% dollar sale. Last year dollar sale was only 25%. I'd go only to 50% this year. --$9 million in credit for tank and Hawk missile spares. Defense opposes credit for normal maintenance items, but would make an exception to beef up the package. I recommend this inconspicuous military help. --$5 million in covert aid for Israel's anti-Communist African programs. This is a private request from Eshkol to help with his budget and doubles last year's program. [2 lines of source text not declassified]/3/ /3/A handwritten note, apparently in Johnson's hand, reads: "[less than 1 line of source text not declassified]." --About $10 million in Ex-Im loans. We can't assign an exact price tag yet because we don't have details on the project. But we'd invite the Israelis to submit a fertilizer project to Ex-Im instead of to AID./4/ /4/A handwritten note, apparently in Johnson's hand, reads: "No development loans." --We'd offer to accept Israeli bids on AID off-shore procurement for 12 months. Though the price tag is relatively small, this is important in helping put unemployed Israelis to work. Defense is also increasing procurement in Israel. Eshkol's Finance Minister has made a strong pitch for this. --We'd give the Israelis Hawk missile capability to do all their own maintenance. This costs us nothing but cuts them in on some classified data. The attached charts shows where this would put us in relation to past years. Since last year's plane sale was unusually high, I think we can justify this FY 1967 level. We still have the desalting project to talk out, and to emphasize that I recommend we move quickly in naming Bunker's successor. Katzenbach recommends we turn them down on two items: --They asked for $20 million in Development Loans on top of the $6 million you authorized last fall from an old loan. Israel is doing so well that it ought to be using Ex-Im rather than the softer AID loans. Congress is grumbling about adding Israel to the list when it's trying to limit the number of countries receiving aid. Last year we split their request of $20 million and offered $10 million each from AID and Ex-Im. I think this is the year to get out of AID lending and refer them entirely to Ex-Im. They'll gripe, but this is reasonable. --Far tougher to turn down is their request for 200 Armed Personnel Carriers ($7.4 million). Harman tells us informally that Eshkol is personally interested and that a turndown will trigger a violent reaction from Jerusalem--and by implication from Israel's friends here. I agree with State and Defense that we can't give these via grant. A grant would amount to starting a Military Assistance Program in Israel, since all previous deals have been credit or commercial sales. This would be a major change in our policy not to be a major arms supplier in the Middle East. The real issue is whether to offer a credit sale instead. We understand informally they'd settle for that. Katzenbach earlier recommended that we sell 100. Now he agrees with Defense to recommend against supplying APC's on any terms. The argument: --We ought to keep the brakes on the Middle East arms race. When we completed the Israeli aircraft deal in March 1965, we told Nasser that sale completed a round of escalation. We said we didn't foresee further sales soon unless the Soviets made more. As far as we know, they haven't, and our December sale to Jordan was too small to affect the balance. --We don't want to become Israel's sole military supplier, but Israel is trying to maneuver us into that position. In our aircraft deal, we made them agree they'd continue to look to Europe for most of their equipment. Good APC's--unlike the aircraft--are available in Europe at reasonable prices. Israel has 1,000 old ones, and selling even 100 opens the door to our modernizing the whole line. --We should be tough as long as they play coy on their nuclear position. Eshkol has invited our technicians to visit Dimona on 22 April./5/ It will be more than a year since our last visit. Only when they report will we know whether we should use all our leverage to make them agree to visits every six months. /5/Telegram 3020 from Tel Aviv, March 23, reported the invitation. (National Archives and Records Administration, RG 59, Central Files 1967-69, AE 11-2 ISR) --We don't think Israel needs APC's urgently. The 1,000 in operation are World War II vintage and will have to be replaced in five years or so. But the Israelis do a remarkable job of keeping equipment running, and the JCS feels that immediate modernization is not essential. --We shouldn't compensate the Israelis for our Jordan package since that resulted directly from their attack. They won't take seriously our counsel of restraint if we reward them now. The strongest argument for a turndown in my book is trying to get a grip on the Middle East arms race. The only approach that could work is an understanding with the USSR to stop big shipments. We've probed before, and the Soviets have shown little interest. But in the context of persuading the Israelis to sign the Non-Proliferation Treaty, they might show more. This is a long shot. But if you decide you can stand the heat, a pause in sales might be worth a try. We could stand up to Israel's friends confident that we're not just stalling. If by fall, the NPT has come to naught, then we'd reconsider. I've double-checked with Katzenbach, and he doesn't feel we'd be reneging on a commitment to refuse the APC's. Even so, if you approve a turndown, the way we couch our answer will be important. The spirit of our response should be more "not now" than a flat "no." My suggestion is to have Katzenbach give them our answer. I can background Abe Feinberg, but the official request came through Katzenbach, and I think we ought to try building him as our sympathetic but firm spokesman to the Israelis. The key problem in US-Israeli relations is that the Israelis like to think they have a special relationship with us, while the State and Defense professionals treat them and the Arabs with the same cool even-handedness. Katzenbach should be warmer and more candid, yet still keep this in official channels. Walt Approve your formulation for refusing APC's /6/None of these options is checked.
402. Circular Telegram From the Department of State to Certain Posts/1/ Washington, April 7, 1967, 9:14 p.m. /1/Source: National Archives and Records Administration, RG 59, Central Files 1967-69, POL 32-1 ISR-SYR. Confidential. Drafted by Wolle; cleared by Houghton, Wheelock, and UNP Director Elizabeth Ann Brown; and approved by Davies. Sent to Amman, Baghdad, Beirut, Cairo, Damascus, Jerusalem, USUN, and London and repeated to Secretary Rusk at Punta del Este as Tosec 16. 171366. 1. Following evening reading item on today's Israel-Syria clash sent to President tonight: "A major border clash centering in and around the Southern and Central Demilitarized Zones took place today. The trouble apparently began when an Israeli tractor plowing in the DZ near Haon was fired upon by Syrians. The resulting battle lasted most of the day and involved mortar, artillery and tank fire and several aerial dogfights. Israel claims to have downed seven Syrian MIG-21 aircraft without loss to its own air arm, and claims to have damaged several Syrian ground positions that had fired on Israeli cultivators and settlements. Syria also claims a victory, alleging that five Israeli aircraft were shot down and at least 70 Israelis killed in fighting that came about when Israel `insisted on aggression.' Syria admits losing four MIGs and suffering 5 deaths. "There are no reports yet from UN truce observers. We have no basis for assessing Israel's claim that the plowing that touched off the day's events was being done in a field that had been under regular cultivation by Israel for years. With both sides claiming victory, there is a fairly good chance that fighting will not be resumed tomorrow." 2. Department taking following line with press on "if asked" basis: "We regret the hostilities and loss of life involved. We are continuing to study the situation and will be interested particularly in reports that come out through the United Nations." Katzenbach
403. Telegram From the Department of State to the Embassy in Israel/1/ Washington, April 11, 1967, 8:41 p.m. /1/Source: National Archives and Records Administration, RG 59, Central Files 1967-69, POL 32-1 ISR-SYR. Confidential; Immediate. Drafted by Atherton and Lambrakis; cleared by Houghton, Campbell, and in draft by Gabriel J. Paolozzi of IO/UNP; and approved by Davies. Also sent to Amman and repeated to Beirut, Cairo, Damascus, Jerusalem, USUN, CINCSTRIKE/CINCMEAFSA, and to Secretary Rusk at Punta del Este as Tosec 94. 173186. Deliver to action officers immediately on opening of business April 12. 1. Bunche informed USUN (septel) that he authorized a Bull (Johnson)/2/ letter be sent to Israelis and Syrians today, April 11, urging early resumption ISMAC meetings and suspension of cultivation pending outcome of meetings. This move particularly welcome in view renewed shooting southern DZ this morning and military preparations apparently being made by both sides which might lead to repetition incident of April 7 proportions or worse as early as April 12, should Israeli cultivation probings continue. Although Syrians may have been bloodied on April 7, it seems unlikely they will desist from further responses to Israeli plowing. This threatens in turn to cause serious difficulties for King Hussein in Jordan for whom hostilities between Syria and Israel present serious internal dilemma. We think UNTSO efforts to defuse situation should be reinforced. /2/Acting UNTSO Chief of Staff. 2. Consequently Embassy Tel Aviv authorized approach GOI at highest level necessary as early as feasible on April 12 in order to stress our concern at escalating potentialities and broader area implications of situation and urge GOI resume earlier suspension of cultivation in troubled areas of DZ and elsewhere along border./3/ Without attempting judge merits of cultivation issue or in any way condoning Syrian firing, we believe it essential provide cooling-off period and give both sides chance to respond to Johnson's letter. /3/Telegram 3254 from Tel Aviv, April 12, reported that Barbour discussed this with Eban and Bitan that day. Telegram 174533 to Tel Aviv, April 13, recorded a similar conversation between Davies and Evron. (Both in National Archives and Records Administration, RG 59, Central Files 1967-69, POL 32-1 ISR-SYR) Katzenbach
404. National Intelligence Estimate/1/ NIE 30-67 Washington, April 13, 1967. /1/Source: Central Intelligence Agency, Job 79-R01012A, ODDI Registry of NIE and SNIE Files. Secret; Controlled Dissem. According to a note on the cover sheet, the estimate was submitted by Director of Central Intelligence Richard M. Helms, and concurred in by the U.S. Intelligence Board on April 13. The Central Intelligence Agency, the intelligence organizations of the Departments of State and Defense, and the NSA participated in its preparation. The CIA, State, Defense, NSA, and AEC representatives concurred; the FBI representative abstained, the subject being outside his jurisdiction. THE ARAB-ISRAELI DISPUTE: CURRENT PHASE The Problem To estimate present attitudes and future trends in the Arab-Israeli problem over the next two or three years. Conclusions A. The Arabs and Israelis are no closer to a solution of their fundamental differences than they ever were. B. Rivalries and disputes among the Arabs reduce their chances of doing anything significant about their quarrel with Israel; these rivalries also create some danger of precipitating crises from which large-scale Arab-Israeli hostilities could develop. C. The Israelis seem likely to continue existing policies, including occasional retaliatory action; they would resort to force on a large scale only if they felt their security seriously endangered. D. The Soviet leaders almost certainly view the Arab-Israeli dispute as promoting their interests. But they do not wish to see it develop into armed conflict. While continuing to supply arms to their Arab friends, they probably wish to keep the arms race from getting out of hand. E. If and when the Arabs come to believe that the Israelis are at the point of deploying strategic missiles,/2/ a phase of sharply increased Arab-Israeli tensions will probably arise. This is likely to occur within the next two to three years. In this event, the Egyptians would probably press the Soviets for help. /2/In the context of an Arab-Israeli conflict, strategic missiles would be those capable of striking the major population centers or military installations of the enemy, i.e., missiles with a range roughly between 100 and 500 miles. [Footnote in the source text.] F. To such an appeal the Soviet leaders would probably feel that they had to respond in some way. They would probably pledge to help Egypt or other Arab states if attacked and would probably provide token technical aid on the Egyptian missile program. They might go so far as to provide a missile system, but we believe they would not supply nuclear warheads or assist in the development of a nuclear weapons program. G. Although periods of increased tension in the Arab-Israeli dispute will occur from time to time, both sides appear to appreciate that large-scale military action involves considerable risk and no assurance of leading to a solution. In any event, the chances are good that the threat of great power intervention will prevent an attempt by either side to resolve the problem by military force.
405. Memorandum From Secretary of Defense McNamara to President Johnson/1/ Washington, April 17, 1967. /1/Source: Johnson Library, National Security File, Country File, Israel, Israeli Aid, 5/67. Secret; Exdis. Filed as an attachment to Document 406. SUBJECT I believe you are familiar with the recommendation of the Interdepartmental Regional Group for Near East-South Asia (IRG/NESA) that we should not accede to Israel's request for 200 armored personnel carriers (APCs), on either a grant aid or sales basis./2/ /2/See Document 400. I personally support that recommendation, and believe it would be a serious mistake for us to provide APCs to Israel at this time, either 200 or any lesser number. I recognize our interest in the maintenance by Israel of an adequate deterrent against attack by any of its Arab neighbors, but the present and prospective military balance in the Middle East strongly favors Israel. The Joint Chiefs of Staff have recently confirmed their view that Israel will be militarily unchallengeable by any combination of Arab states at least during the next five years./3/ As presently trained and equipped, the armed forces of Israel are greatly superior in effectiveness and firepower to those of their potential opponents, individually or collectively. /3/See Document 387. Israeli security is also strengthened by the US policy of maintaining a controlled military supply relationship with those Arab states who show moderation toward Israel and who resist opportunities to acquire Soviet equipment; this helps to avoid a polarization of the Arab-Israeli dispute along East-West lines. Our dramatic airlift of equipment to Jordan last winter was necessary to save King Hussein's regime, which had been badly undermined by the unfortunate Israeli raid against Samu in November. Our failure to act could have led to a rapid deterioration in Jordan, involving the introduction of Egyptian armed forces and Soviet advisers and equipment. Provision of additional APCs to Israel at this time could, in my judgment, only serve to undercut the good effect of what we did for Jordan, to "pay twice" for the Israeli miscalculation at Samu, and to agitate a situation that is now relatively quiescent. In the agreement of March 1966 for the purchase of Skyhawk aircraft,/4/ Israel explicitly recognized that that sale did not constitute a precedent for future U.S. action, and further agreed "to continue to look to Europe for the bulk of its military requirements and not to regard the U.S. as a major arms supplier." In making its current request for APCs, the Israelis would appear to be disregarding these conditions which they accepted just over a year ago. In my judgment, our recent supplementary aid to Jordan has not altered the validity of these conditions. /4/See Document 283. I therefore recommend that we turn down the Israeli request for APCs, and suggest that they should look to Western European sources if they consider it necessary to purchase APCs at this time. Robert S. McNamara
406. Memorandum From the President's Special Assistant (Rostow) to President Johnson/1/ Washington, April 18, 1967. /1/Source: Johnson Library, National Security File, Country File, Israel, Israeli Aid, 5/67. Secret; Exdis. Filed with an April 18 covering memorandum from Rostow to the President recommending that he hold the APCs--and if politically feasible, the whole package--until April 28. The covering memorandum bears Johnson's handwritten note: "Put on my desk & have available when Feinberg appt is ready. L." SUBJECT The attached table/2/ reviews where we stand. Three issues remain. You may want to discuss the APC's with Secretaries Rusk and McNamara Thursday/3/ afternoon. Whatever you decide, I recommend you hold them until after 28 April when we'll have a report on this weekend's inspection of the Dimona nuclear plant. /2/Not printed; see footnote 1, Document 401. /3/April 20. I. Armed Personnel Carriers. Secretaries McNamara (Tab A)/4/ and Katzenbach (Tab B)/5/ have reconsidered and still recommend against. Their arguments boil down to: /4/Document 405. /5/Katzenbach's April 17 memorandum to the President is not printed. A. Uneasiness about fueling any arms race. Congress is concerned. Our India-Pak decision tried to restrain that buildup, and we've kept our Middle East programs to the minimum. APC's would not seriously affect the arms balance, but no one wants to start another round of sales. In the context of the Non-Proliferation talks, we may even try for tacit Soviet agreement to hold down arms shipments to the Middle East. This sale wouldn't upset that effort, but our skirts would be cleaner without it. B. Concern over too close a military relationship while Israel's nuclear intentions are in doubt. Our intelligence people suspect--on uncertain evidence--that Israel may be building a separation plant. Our inspection team will visit Dimona this weekend for the first time in over a year. With the NPT ahead of us, we may need a clear expression of Israel's position. We can't bargain with APC's, but we could hold them until we're sure our inspection team gets full cooperation. Our dilemma is that foreign policy interests argue against a sale now, but the Israelis will treat a "no" as a broken promise. Israel could do without APC's this year, but Eshkol believes that we promised something in return for their keeping quiet on our Jordan package last December. If we go ahead, Secretary Katzenbach recommends we minimize repercussions by selling only 100. He suggests stretching delivery through 1970, but after our airlift to Jordan, I'm afraid that won't work. In any case, we must control publicity and timing. Defense tentatively concludes that Israel could set up an assembly line using some US-supplied parts, but Secretary Katzenbach believes this would make our relationship too close. You may want to hear argument before deciding. On foreign policy grounds alone, I would recommend telling the Israelis we can't sell APC's now, but would reconsider next year. But if you want to go ahead, I recommend 75-100 now and promising to discuss assembly in Israel. Hold APC's until after 28 April; go ahead with the rest of the package now /6/The first option is revised in Johnson's handwriting to read: "Hold APC's and package until after 28 April." The second option is checked. II. Amount and terms of PL 480. Secretary Katzenbach recommended $23.5 million because Agriculture judged that Israel will need less than it asked for. Your figure was $28 million--the full Israeli request. One way to avoid rushing more scarce grain than needed would be to negotiate $23.5 million now but say we'll go up to $28 million if Israel needs more. In view of Congressional pressure to tighten terms, Secretary Katzenbach recommended 75% dollar sale at about 4.5% interest (last year 25% at 2.5%). Normally, we would figure on moving to 50% dollar sale at maybe 3.5% as an appropriate transitional step. You initially preferred last year's terms, but you may want to consider slight hardening this year to put us on a better footing with Congress. $23.5 million now; will amend up to $28 million/7/ /7/This option and the "2.5% interest" option are checked. Up to $28 million now 25% dollar sale--2.5% interest III. Moving on Bunker's successor might improve the package. Bob Bowie is a good possibility, but we might ask Douglas Dillon again. See if Dillon is available /8/This option is checked. Walt
407. Memorandum From the President's Special Assistant (Rostow) to President Johnson/1/ Washington, April 20, 1967. /1/Source: Johnson Library, National Security File, Country File, Israel, Vol. VI. Secret; Exdis. SUBJECT /2/The President met with Feinberg from noon to 12:40 p.m. on April 20 prior to the latter's departure for Israel. (Ibid., President's Daily Diary) I have sent you a separate memo on the Israeli aid package./3/ I recommend you not give Abe any answers until you have discussed this with Secretaries Rusk and McNamara. Your options on timing are: /3/Document 406. 1. Hold the whole package until after we get the report on our Dimona inspection about 28 April. 2. Release everything in the package except your decision on APC's until we're sure the Israelis have cooperated fully with our inspection team. 3. Release the whole package now. The main reason for holding off is to demonstrate that you're serious about nuclear non-proliferation. Even this year's whole aid package wouldn't be enough to bargain with on this life-or-death issue (as Israel sees it). However, as we approach the time when we may need to press Israel to sign the NPT, we must consider how much leverage we need to hold in reserve. So far the Israelis have succeeded in keeping this apart from the rest of our relationship. The only counter big enough to sway Eshkol, I suspect, will be the US-Israeli relationship itself. By purely foreign policy standards, we should be drawing back a little now to signal how seriously we take this issue. I realize this creates a domestic dilemma, but I should think the Jewish community itself with its liberal tendencies would be strongly attracted to the NPT. Israel has never leveled with us on its nuclear intent. Our intelligence people have scattered--but as yet unconfirmed--evidence that Israel is quietly but steadily placing itself in a position to produce nuclear weapons on short notice. We also know that Israel is investing large sums in a French built surface-to-surface missile designed to carry a nuclear warhead. I must emphasize that we do not know exactly what Israel is doing or what its position on the NPT will be. But we know enough to be seriously concerned. Therefore, it may be wise to take special care with each step this year. Walt
Attachment/4/ Washington, April 20, 1967, 10:10 a.m. /4/Secret. Mr. President: Hal Saunders and I have staffed out the paper done by Dave Ginsburg./5/ I wanted you to have, as he did them during the night, Hal's direct comments on the paper/6/--including their flavor. Hal is an extremely well-balanced analyst of the Middle East. /5/Reference is evidently to an unsigned and undated memorandum for the President on the subject "1968--American Jewry and Israel," attached but not printed. /6/An April 20 memorandum from Saunders to Rostow with his comments is attached but not printed. I would divide my own comments in two parts: first, the items in David's paper which we had planned already to support or could support; second, our security relations with Israel. 1. This is the position with respect to David's non-military proposals: --Food purchases: already provided for. --Development loans: EX-IM is the proper source, given Israel's level of income and foreign exchange position; but there is no reason why Linder cannot be very generous. --Stimulating Israeli fertilizer exports: provided for in our package. --Repayment in commodities: a new proposal now being staffed out. It seems possible to me, especially if Israel would make the deal proposed by David in the first part of paragraph 16 (p. 17)./7/ /7/The proposal was for Israel to retain from $150 to $250 million of its foreign exchange reserves in the United States in order to ease the U.S. balance-of-payments difficulties. --Exports to the U.S.: DOD is pressing this as hard as it can; perhaps Bob McNamara could press it a little harder. --Desalinization: This should go forward urgently: Jack Valenti would be fine but, as with Eric Johnston, he might need to put himself in the position to approach the Arabs with some kind of parallel project in order not to damage his moving picture interests in the Middle East. Such an approach was not ruled out in the Bunker terms of reference; but it may be more important for Jack than for Ellsworth. Katzenbach proposes Bowie; but Dillon and others are possibilities. --An American University in Israel: Without intimate knowledge, Hal's marginal comment on page 15 seems wise; namely, that it is unlikely we could create a new institution up to high existing Israeli standards; but we might increase our already substantial support for Israeli institutions now in being. Nevertheless, an "American University" in Israel might be looked at afresh. --Visits to Israel by high-level U.S. officials and a visit to the U.S. by Eshkol seem manageable. 2. Security problems. a. In general David's paper does not recognize something which the Israeli government does recognize even if sometimes reluctantly; namely, the U.S. has legitimate interests throughout the Middle East and the maintenance of those interests is, by and large, in the long-run interest of Israel, because, where our influence is strong, we strengthen the hand of Arab moderates. It is odd that as thoughtful a man as David should not have made this point. b. Our critical problem with Israel is that they have wanted the advantage of a U.S. guarantee but have simultaneously wanted to maintain a military establishment which could be effective if the U.S. guarantee did not operate in a crisis. The technical reason for the Israel position is their anxiety about a quick Arab strike against them--from the air or on the ground--which we might be too slow to deal with. It is this ambiguity which has, quite understandably, in some ways led them to build up their military establishment in ways which made it easier for the Russians to have their offers of military aid accepted in the Middle East. The APC question relates to this. Bob McNamara and others think that APC purchases from the U.S. might open up another round of Soviet military credit sales to the Arabs in the Middle East. I am not sure that is necessarily so if the APC's are moved in on a clear replacement basis. There is another problem with certain members of Congress who have resisted our being an active part of the Middle East arms race. c. The nuclear question. This is critical for large U.S. interests. We have been able to live with this ambiguous Israeli defense policy in terms of conventional weapons. Should they wish to have both a national nuclear capability and U.S. guarantees, we would be in an almost impossible position. Moreover, if they insisted on it, it might well destroy the possibilities of a non-proliferation treaty throughout the world. Therefore, we must develop a much deeper understanding with them on the nuclear question if we are to proceed with a policy of being, quite openly and without apology, their friends. Walt
408. Telegram From the Embassy in Lebanon to the Department of State/1/ Beirut, April 20, 1967, 1625Z. /1/Source: National Archives and Records Administration, RG 59, Central Files 1967-69, POL LEB. Confidential. Received at 1:51 p.m. Repeated to Amman, Ankara, Cairo, Damascus, Moscow, and Tehran. 9598. 1. Met with Pres Helou evening April 18. His main themes were (A) deterioration in Lebanese political stability, (B) necessity for GOL commence economic and social development program despite lack of funds, (C) massive Soviet aid offer to Lebanon, and (D) urgent, almost desperate plea for US assistance. 2. Soviet comprehensive assistance package is major new factor in equation. Offer, which buttresses increased Soviet activity in Lebanon in other fields, includes inter alia (A) Soviet purchase large amounts Lebanese apples and citrus fruits in exchange for Lebanese agreement buy equivalent value of commodities in USSR which now being purchased in third countries. (B) Proposal to construct up to twenty (presumably consumer goods) factories in Lebanese private sector with Soviets agreeing purchase total production. (C) Financing and constructing the usual steel plant. (D) Wide-ranging proposals to finance a variety of GOL development projects, particularly in hydro and electricity generating and distribution projects. (E) Financing and technical assistance in road projects as well as a possible subway system. I feel sure offer also included armament sales proposals although Helou skipped several sections in reading to me from very detailed multi-page Soviet proposal. 3. Helou said he had been sitting on Soviet proposal since March 13 and so far had avoided leaks. He was aware, however, that he was sitting on a timebomb and that leftist groups in the country would ultimately expose existence of Soviet offer in order present maximum embarrassment to GOL. Soviets would also be putting on pressure, perhaps during upcoming visit of Soviet Parliamentary delegation. Soviets had stressed in original presentation that they now involved in large-scale aid to Iran and Turkey and had posed specific question to Lebanon as to whether she intended to act more pro-Western than the CENTO powers. This was important propaganda point in Helou's mind. Also, he added, Damascus and Cairo would of course join at appropriate time in applying pressure on Lebanon to accept all or part of the Soviet offer, using their own experience as model. 4. Unfortunately, said Helou, he was not immune to such pressures since he had been unable to make progress in moving the GOL's essential economic and social development schemes off dead center. Despite his determined efforts reduce graft and pare budget, the problem was very simply one of lack of ready funds and ultimately he could not resist attractive offers of external assistance from any sources if there was no other way to respond to the legitimate aspirations of his people. The leftist and radical political forces and leaders within Lebanon were more than ready to take advantage of the government's inability to act. Since they would be espousing legitimate social causes and economic grievances this was not the kind of situation which he could control by muzzling the press or calling in the security forces to suppress leftist agitation. In any case, he also believed that social progress was essential and he could only chide himself for not having started sooner. (He did not take refuge in the genuine excuse that the Intra Bank crisis was a major set-back to his plans.) 5. Helou emphasized that he was not raising the bugaboo of Soviet assistance in Lebanon to apply leverage on the US. But the simple fact was that he had to have untied credits of the kind represented by US grain sales in order to give him a free hand in financing the most urgent projects (e.g., housing, education, public health, roads) without the further long delay which specific and detailed project planning would involve. Proposed credits from international institutions or from such countries as Kuwait and France, although available, required substantial down payments and too much time to implement. He needed action now. In response to my many remonstrations on the dangers of Soviet economic penetration and my comments on the lack of comparability of Soviet proposals for Lebanon (which gave them strong foothold in economic life of country) as contrasted to Iran (exploitation of petroleum resources which had no other ready market), Helou simply responded that he fully agreed. His main objective was to keep the Soviets out of Lebanon. The pitfalls he clearly understood. What he needed was an alternative course of action which would keep the opposition quiet. 6. Helou then made it clear, in a somber and sometimes impassioned presentation, that his only source of help was from the US. The psychological impact of US assistance was as important as the financial. Without visible US support he could not stave off the pent-up pressures for development and social progress which ultimately would present the left with its golden political opportunity, and as well bring in a Soviet presence. He painted a gloomy picture of the future, and said that his successor would indeed have infinitely worse problems than he, unless something were done quickly to stem the leftward drift of the country. The socialist Arab states were of course already at work, nibbling away at confidence in Lebanon's free enterprise system. 7. I took the opportunity to make the point that I had been disturbed about the steady deterioration and leftward trend in Lebanon as represented by such events as Lebanese sponsorship of Afro-Asian Writers Conference; the apparent succumbing to outside pressures to make decisions that obviously were not in Lebanese interest; and the inability of the GOL to restrain propaganda attacks in the local press in such obvious matters of self-interest as Sixth Fleet visits. I noted with concern the growing permissiveness with regard to criticism and attack against the US. Helou accepted the criticism and admitted that much of it was apt. The real problem, he reiterated, was that the GOL had been unable to start its development programs. This had brought about a legitimate focus of unrest and loss of confidence in the government which was seized upon by the radical political elements. As he had reminded me many times before, he thought it was in the self-interest of the US to help him create an environment which would reverse this trend and make it possible for the GOL not only to do that which needed doing to develop the country, but also to emphasize the supporting role of the US. It was up to the US, as the stronger partner, to take the initiative to create the ambiance for closer cooperation between Lebanon and the US in all fields. 8. During the course of the conversation I took the opportunity to describe the US grain credit proposals, as set forth in State 173820./2/ Helou, while unhappy with high cost (particularly bank guarantee) of CCC credits and the small size of the possible PL-480 component, nonetheless expressed substantial interest in considering any US offer which was "acceptable" even if not clearly "advantageous." His problem was to get funds, and any funds generated by our credits would be immediately channelled into development projects. He said he would like as large a program as possible, if we could come to agreement. I informed him that I had just discussed the matter with FonMin Hakim and had given him latest information I had. We agreed I would again see Hakim immediately in order to present to GOL in clear terms the nature and conditions of the US proposal. /2/Telegram 173820 to Beirut, April 12, instructed the Embassy to present a proposal for CCC credits to the Lebanese Government and to explain what Washington officials anticipated discussing in May a prospective P.L. 480 proposal for fiscal year 1968. (Ibid., AID (US) 15-11 LEB) Porter
409. Telegram From the Embassy in Lebanon to the Department of State/1/ Beirut, April 20, 1967, 1631Z. /1/Source: National Archives and Records Administration, RG 59, Central Files 1967-69, DEF 7 LEB-US. Confidential. Received at 2:49 p.m. Repeated to Amman, Baghdad, Cairo, Damascus, Jidda, London, Moscow, CINCSTRIKE, Tel Aviv, CINCUSNAVEUR, CNO, COMSIXTHFLT, COMIDEASTFOR, CTG 60.2, and the Department of Defense. 9599. Subject: US Sixth Fleet. 1. During the course my discussion with President Charles Helou April 18, I raised issue of present propaganda attacks levied upon Sixth Fleet and its presence in Mediterranean. Referred to Eshkol statement/2/ and took basically same line with President as I did with Foreign Minister Hakim April 17 (see Embtel 9452)./3/ Reiterated that unauthorized statement by a leader of a given state does not constitute United States policy. With due recognition to existence free press in Lebanon, expressed distress over unbridled propaganda attacks against United States and against Sixth Fleet visits Lebanon by radical Lebanese papers and few Lebanese politicians. /2/Reference is to a statement made by Eshkol in an interview that appeared in U.S. News and World Report. In response to a question whether he would expect help from the United States if Israel were attacked in force by its neighbors, he stated that Israel would rely primarily on its own army but that he would expect help "especially if I take into consideration all the solemn promises that have been made to Israel. We get these promises when we ask the United States for arms and are told: 'Don't spend your money. We are here. The Sixth Fleet is here.' My reply to this advice is that the Sixth Fleet might not be available fast enough for one reason or another, so Israel must be strong on its own." (U.S. News and World Report (Vol. LXII, No. 16), April 17, 1967, p. 76) /3/Telegram 9452 from Beirut, April 17, reported that in a meeting that day, Hakim urged a public U.S. refutation of the Eshkol statement. Porter told him the United States could not constantly engage in public debate over statements by leaders of other states and assured him that U.S. policy toward the Middle East as stated by President Kennedy and other leaders had not changed. (National Archives and Records Administration, RG 59, Central Files 1967-69, DEF 7 LEB-US) 2. Explained to Helou that purpose Sixth Fleet in Med twofold: (1) oppose Communist aggression, (2) safeguard peace in area. Pointed out raison d'etre Sixth Fleet had to be viewed in this context. Fleet not here to protect any particular state, but to forestall aggression. 3. Helou stated Lebanon played instrumental role in Arab League in avoiding all criticism of presence nuclear weapons in Mediterranean. Helou commented if he could "press a button" to stop attacks of politicians and newspapers against US and Sixth Fleet he would do so immediately. Stated "I am not King Hussein, nor King Feisal, nor President Nasser, I am the Chief of State of Lebanon". Referred to confessional nature Lebanon's society and stated he obliged play much more delicate role in facing various propaganda attacks which emanate from inside and outside of Lebanon. Said he had to take into consideration views of various Lebanese confessional groups and commented "half the population of Lebanon looks to Nasser and Atassi" for leadership. Said he must work within these limitations. 4. Helou asserted US must recognize Prime Minister Karame's position. Explained that Karame, as Sunni leader, facing domestic political opposition which ready take advantage any opportunity to bring pressure to bear against Karame government. Helou said if pressures emanating from Cairo and Damascus added to local pressures Karame faces, Karame would find himself in most difficult situation in maintaining himself in power. Nonetheless, Helou said had discussed question with Karame to try to forestall action which would aggravate problem of future Sixth Fleet visits. 5. I made it clear to Helou that if Syria's so-called "government" able to pressure Lebanon into actions which might mean practical withdrawal Sixth Fleet from Eastern Mediterranean, this would appear have tragic consequences not only for Lebanon but for peace in the area as a whole. 6. Helou said unfortunately no delineated border exists between Lebanon and Syria and as consequence there is not only unauthorized physical passage across borders but also free passage ideas and propaganda. Helou tied issue Sixth Fleet visits to US policy of assistance to Lebanon and said Karame needs help. Explained that if GOL could point to tangible US assistance offer to Lebanon, situation of GOL would be much easier in respect to staving off mounting pressures for cancelling Sixth Fleet visits (see Embtel 9598)./4/ /4/Document 408. 7. I reiterated to Helou that it basically in Lebanon's interest have Fleet visits and only Cairo, Damascus, and other states interested in eliminating US presence in garble would stand to gain if Lebanon refused visits. Comment: Helou has of course always been staunch supporter Sixth Fleet visits, and needs no reminders of significance of Fleet to Lebanon. His inability, for the first time, to give me flat reassurances that visits will continue, is indication of the hard political dilemma with which he (and Lebanon) are faced. 9. Nonetheless, GOL is trying hard keep Sixth Fleet issue from coming to head. Cancellation of general Parliamentary debate April 19 through lack of quorum undoubtedly Karame ploy to avoid taking public position in response to inevitable hostile questioning. He will have take hard line position, against his better judgment, if pressures become too intense, but will probably hold out for a while longer in hope US assistance offer will enable him show tangible evidence US support for GOL's economic and social objectives. 10. This is going to be another typically Lebanese issue where the final decision will be based largely on external influences and only secondarily on rational self-interest of the country./5/ /5/Telegram 10510 from Beirut, May 15, reported that Helou informed Porter that day that area developments and pressures on the Karame government led him to the reluctant decision to postpone a U.S. carrier group visit scheduled for May 26. (National Archives and Records Administration, RG 59, Central Files 1967-69, DEF 7 LEB-US) Porter [Continue with the next documents] Volume XVIII Index | Foreign Relations Online | Historian's Office | Department of State | Secretary of State |