784A.00/6–1151
Memorandum of Conversation, by the Assistant Secretary of State for Near Eastern, South Asian, and African Affairs (McGhee)1
Subject: Visit of Mr. Jacob Blaustein, President, American Jewish Committee and the American Oil Company.
| Participants: | Mr. Blaustein |
| Mr. McGhee—NEA | |
| Mr. Lewis Jones—NE | |
| Mr. Waldo—NE | |
| Mr. Stabler—NE | |
| Mr. Blaustein called on me at his request to discuss his recent interview with the Egyptian Ambassador to the US, as well as certain other items. |
[Here follows a discussion of the situation in Morocco.]
2. Israel: Mr. Blaustein agreed that grant-aid for the Near East should be provided on a regional basis, provided that Israel received enough. He suggested it might be desirable for him to discuss the matter with the Bureau of the Budget and Mr. Foster of ECA with this in mind. I told Mr. Blaustein that under the President’s program Israel was scheduled to receive $23.5 million, and that any greater sum under present budgeting would certainly be considered by the Arabs as proof of a complete lack of impartiality. Mr. Blaustein said that Israel could be counted upon as an ally and that, therefore, it should get the same aid as the European countries. I said that it was not possible to increase the amount; the President had already set forth the US position in his message to the Congress.2 We also felt that $50 million for the refugees was equally of benefit to Israel.
Mr. Blaustein inquired whether the Arabs had agreed to resettlement. I said that these funds were not for the payment of compensation, but were to provide for feeding under the UN and for projects leading to resettlement. I told Mr. Blaustein that two years ago it was clear to me that the refugees would have to be resettled in the Arab states and, if these states agreed, resettlement should be forthcoming soon.
Mr. Blaustein then raised the question of the SC Resolution of May 18, and expressed disappointment in it. He said it might endanger Ben-Gurion’s chances in the forthcoming elections in Israel and make the Arabs more difficult to deal with. He admitted, however, that Israel had gone along with the UN decision and that everything I had told him would occur had happened. I said that the resolution had reestablished respect for the UN in the area. We now believed that General Riley should be permitted to have a free hand under the resolution.
3. Discussion with Egyptian Ambassador:
Mr. Blaustein then turned to a discussion of his meeting with the Egyptian Ambassador. He had told the Egyptian Ambassador that he was a non-Zionist, but not an anti-Zionist. He was not a member of any Zionist organization nor a supporter of the more radical aspects of Zionism. He was eager for peace in the Near East area and hoped that the ECA aid could be extended to the area in order to fight Communism. Egypt was the only country south of Turkey which had the necessary industrial capacity to raise the standard of living for the masses.
Mr. Jones said that it was difficult to convince the workers of Egypt and Iraq of the miserable lot of Communist workers. Their own condition [Page 709] was bad enough. They could also claim that the West had given to the Arab world Israel and the refugees. Mr. Blaustein said he understood from the Ambassador that the Syrians had turned down Point IV.3 Mr. Jones replied that that was indeed the case. There were several factors which had a bearing on the matter: (1) Israel slowness in complying with SC resolution of May 18 and (2) Syrian discouragement because we had allocated $23.5 million for Israel and only $23.5 million for all the Arab states. These facts, plus a weak Syrian government, had resulted in the rejection of Point IV. Mr. Blaustein said it was his view that the feudal landowners didn’t want Point IV and the French business groups were also afraid of it. He had told the Egyptian Ambassador that nations were like individuals. There were times when you had to be realistic. Britain had made mistakes by moving too slowly in the area, and Egypt should profit by the example and do something to make peace. He told the Ambassador that if Israel were going to collapse, the Egyptian policy of watchful waiting was sufficient, but Israel was not going to collapse. The fact that certain American senators and representatives were getting behind a bill for grant-aid to Israel showed that Israel is supported by American public opinion—not only by American Jews. The Egyptian Ambassador said that Communism was a great menace, and inquired whether Israel would be willing to join an Arab bloc against Communism, Mr. Blaustein said he didn’t know, but it was a good idea.
I said that I thought Israel would cooperate with the West, as well as with the Arabs. Mr. Blaustein inquired whether such cooperation would be within the framework of the Atlantic Pact. I said I didn’t think so, but that we would be happy to encourage any regional grouping of this sort.
Mr. Blaustein said he had suggested that the Egyptian Ambassador meet Ambassador Eban at his (Blaustein’s) home in Baltimore. The Egyptian Ambassador, however, had replied that he would have to get the approval of his government for such a meeting. Mr. Blaustein had also told the Egyptian Ambassador that there were basically no problems between Israel and Egypt. The Ambassador said that Egypt wanted peace, and Mr. Blaustein requested the Ambassador to talk to his government about the matter.
I said that if this would work it would be a good thing, but that we had had previous experience in this problem: In 1949, we had acted as intermediary between Egypt and Israel in connection with the Gaza Strip. We had thought it would be an extremely constructive step if Israel could have taken over the Gaza Strip and at the same time assume full responsibility for the inhabitants and refugees there. However, the Egyptians had refused to negotiate on the subject. While we are not trying to impose peace, we want it nonetheless. [Page 710] However, we do not think any Egyptian government would make peace at this time. The Arabs feel that they would not get anything from Israel, so they do not understand why they should make peace and give up their policy of noncooperation and no trade. Mr. Blaustein said that Ben-Gurion had told him that arrangements could be worked out with the Egyptians to save face all around. I said that a small offer at this juncture, but one outside the context of a final settlement, to give up territory, take back refugees, or release blocked Arab accounts might be helpful in bringing about the final objective. Mr. Blaustein wondered whether it really would be helpful, and referred to the Israel offer to take back 100,000 refugees. I said that when the offer was made we had urged the Arabs to consider it.
Mr. Blaustein said that the Egyptian Ambassador had told him to tell Eban to stop border incidents. I said that we didn’t wish to say who was to blame, but the Israelis had refused to accept the rulings of the head UN man in Palestine and most of the incidents on the Syrian border had taken place after that. I said that Eban had taken the entire Huleh incident too hard and too personally, and had really made things more difficult by his insistence and subjectivity.
Mr. Blaustein said that he would ask the Egyptian Ambassador over to his house in a couple weeks, and suggested that I come along too. I told him that this would put the matter in an entirely different light so far as the Ambassador was concerned; that it would be better if Mr. Blaustein saw the Ambassador by himself.
Mr. Blaustein then mentioned the problem of the Iraqi Jews, particularly of Iraqi Jews who were abroad and who had property in Iraq. He felt that these men were treated unfairly if their assets were frozen or confiscated. I said I thought this was being cleared up. I mentioned, with regard to the immigration into Israel, that Mr. Kaplan, Minister of Finance, had mentioned the possibility of mass emigration from Iran. I said it was one thing to take Jews from all over the world who were in distress, but it was another matter entirely to attempt to create circumstances which would stimulate immigration of Jews from areas where they were living in peace. Mr. Blaustein agreed with me in this, and said that Ben-Gurion’s reference to a 4,000,000 population in Israel was fantastically large.