Foreign Relations of the United States, 1961–1963, Volume XVII, Near East, 1961–1962

142. Memorandum From the President’s Deputy Special Counsel (Feldman) to President Kennedy⁰

Washington, November 21, 1961.

At our meeting two weeks ago you asked that I furnish you with information regarding the level of assistance to Israel and the use of ICA funds by Israel.

I. The Level of Assistance to Israel

Excluding Export-Import Bank loans, U.S. economic aid to Israel during the past four years has been as follows:

• 1958—63.5 million
• 1959—50.8 million
• 1960—65.1 million
• 1961—59.4 million (of which 10 million was actually received in fiscal 1962)

This aid was made up of special assistance, P.L. 480, and Development Loan funds. In addition, Export-Import Bank loans, made at irregular intervals, have averaged 12.5 million per year in recent years.

Since special assistance is no longer available, economic aid to Israel during 1962 must take the form of P.L. 480 aid, Development Loan type funds, and Export-Import Bank loans. The Israeli government has indicated that it would prefer to have its Export-Import Bank loans considered solely on their merits as bankable transactions for the assistance of American industries, rather than as assistance to Israel, and therefore excluded from any computation of aid.

The State Department is planning to recommend for 1962 about the same level of aid to Israel as it has received in the past—between 60 and 65 million dollars. It would, however, make up this sum by including P.L. 480 shipments of 26 million, Export-Import Bank loans of approximately 20 million, and only 15 to 20 million in Development Loans. Israel is very disappointed. It does not consider the Export-Import loans as aid of the same nature as the other assistance. Moreover, it argues that Secretary Dillon, under the previous Administration, promised a level of aid 30 million dollars higher than previously advanced to Israel in order to compensate for lack of military assistance. (You will remember that Prime Minister Ben Gurion raised this matter at his meeting with you.) Israel requests 25 to 27 million of P.L. 480 assistance and 35 to 40 million of Development Loans to equal the assistance it received in prior years (excluding the 10 million it received early in July under a continuing resolution which it regards as part of its fiscal 1961 aid). In addition, it has asked for 30 million promised by Secretary Dillon, making a total of about 90 million dollars, for fiscal 1962.

I recommend that Israel receive assistance equal to that of prior years, based on its own computations. That means, basically, that it should get Development Loans of 35 to 40 million dollars in fiscal 1962.

II. CIA [ICA] Relationships¹

We have long recognized that there are benefits to the United States in loans from Israel to the developing nations. Israel has developed the following programs:

1) It trains African and Asian leaders in Israel. There are ten permanent centers for trainees in Israel.

2) It sends Israeli experts and advisors to interested nations. In the first 10 months of 1961, 205 Israeli experts were sent to Africa and Asia, 6 to Latin America. It now has a current request for 65 more.

3) It organizes teams of training facilities in interested nations to train their people. It is currently making preparations to create five centers for training capable of handling 500 trainees in five West African countries.

4) It establishes joint enterprises for training purposes. One joint construction company established by Israel in which the West African company employs about 5,000 local personnel with a total Israeli force of 50 people. Israel now has some form of technical assistance in 52 countries.

Advantages to the United States are as follows:

1) It is much cheaper. It costs approximately $800.00 a month to pay for the living expenses, travel, and books of one trainee in Israel, and approximately $550.00 a month to send one Israeli expert abroad. American costs are double.

2) Israel, because it is a small country, can often be more effective.

3) Israel has a mixed population of which 50% are of Asian or African origin and all are of recent pioneering tradition. This has proved very helpful in orienting the foreign nations properly.

Requests from Israel:

Israel has requested 5 million dollars per year. If she receives this she can continue her present level of operations and possibly expand it into Latin America where she is very anxious to undertake similar measures.

Two recent projects furnish an interesting illustration of how she operates:

1) Central African Republic

In the summer of 1961, Mr. Ehud Avriel, Deputy Director General of the Israel Ministry for Foreign Affairs, visited Bangui for discussions with President David Dako. At that time President Dako had been regarded as veering strongly toward the Soviet Bloc because of (1) his conflict with the French on a number of issues, and (2) the fact that his country had been visited by many delegations from Soviet Bloc countries. The situation was of particular concern in the light of the Central African Republic’s important strategic position between Chad and the Congo. As a result of their discussions, President Dako asked for 15 advisors from Israel, together with 57 Central African Republic trainees to serve as supervisors of the various government programs. In addition, he asked for three people from Israel to serve as personal advisors to himself and nine people to serve as regional development officials. Although without funds, Mr. Avriel considered this so important a break-through, he committed Israel to furnish these people.

In the course of the conversations between the two men, President Dako said his country faced three choices:

1) He could turn to the Soviet-Chinese Bloc, but was sure he would end up under heavy domination by them;

2) He could rely on the Western powers, but he felt that these countries were interested in the maintenance of the existing social structure and this would not permit him sufficient scope for his revolutionary needs;

3) He could base himself on the Israeli model because Israel was a small country without a colonialistic past and with an original social structure.

2) Tanganyika

Between January and October 1961, 91 Tanganyikans were brought to Israel to participate in various projects. Among these were people designated to serve as permanent Secretaries of Ministries and in other similar posts. In October, immediately after his return from Great Britain, Prime Minister Julius Nyerere met with Mr. Avriel. The Prime Minister was discouraged and frustrated. He had been unsuccessful in Great Britain in his search for assistance and talked about turning to Moscow and Peking.

He revealed his intention to create in Tanganyika a revolutionary youth movement that would develop his country in the way China and the Soviet Union had been developed.

Mr. Avriel succeeded in pointing out that Tanganyika was less in need of a leadership that could mouth revolutionary phraseology than it was in the need of a trained youth that could put to use a spirit of dedication. Following the conversations Israel sent to Tanganyika the Director of a rural training institute to help establish a youth leadership and training center. In addition, there are now the following other projects: A joint construction company, a 2-man medical mission, 2 experts to organize the Independence Day Celebration to be held on December 9, 1961, a public health officer to be in charge of public health of the city of Dar-es-Salaam, an advisor to the Minister of Commerce, an advisor for agriculture planning, and an expert in fishing.

Similar stories are available for Kenya, Uganda, Zanzibar, and Nyasaland.²

Myer Feldman³

0. Source: Kennedy Library, President’s Office File, Staff Memoranda, Feldman, Myer. No classification marking.
1. The reference to CIA is apparently a typographical error.
2. The notes of a telephone conversation on December 26 between Secretary of State Rusk and the AID Administrator, Fowler Hamilton, read as follows: “The Sec returned the call. Re aid to Israel: H gathers from Feldman that the Pres has decided unless there is some crushing reason against he wants to see that Israel gets as much as under the previous Administration. H has had a long session going over the economics of it and had a session with Talbot and Gaud and he can’t see anything adverse politically if it were done. Unless the Sec feels otherwise they should go ahead. The Sec said yes—particularly when Nasser is making the noises he is.” (Department of State, Rusk Files: Lot 72 D 192, Telephone Conversations)
3. Printed from a copy that bears this typed signature.