Office of the Historian

226. Memorandum From Robert W. Komer of the National Security Council Staff to President Johnson1

Washington, July 2, 1965, 3:30 p.m.

Despite the Javits speech, Congress and the press reacted with restraint on the whole to the $37 million food for the UAR. There was relatively little other adverse comment, though Gruening, Farbstein, Pelly, Michel and Horton said the expected. The returns aren’t all in, and we hear that Michaels may try to amend the appropriation to block all aid to the UAR. But the telling argument was willingness to honor a commitment, not sympathy for Nasser.

We moved just in time to spoil partly a big Soviet propaganda coup. In desperation Nasser got Moscow to divert 300,000 tons of its own purchases from Canada and Australia, which he doubtless planned to announce with fanfare once he decided there was no hope from us. Nasser also apparently got some wheat on credit from Mexico and Argentina. All this, plus the UAR’s own crop, will fill Egyptian needs through the winter. So it relieves pressure on us, and gives us time to sort out our relations with Nasser.

There’s a rumor that you feel we led you astray on the UAR by painting a grim picture of its inability to get food. I don’t believe this, [Page 476] because we put the case on straight political grounds of preventing a real bust-up between the US and UAR. Our chief hope was to forestall total UAR dependence on the Soviets for wheat as well as arms. We’re still in this ballgame if we choose.

New Problem. Releasing the $37 million has led to growing pressure on Agriculture from the trade and its Hill friends to resume CCC credit sales. We’ve been sitting on about $30 million worth of applications for wheat, tobacco, barley, etc. Agriculture is pressing to release these because they earn dollars and help meet PL 480 usual marketings. It’s also odd that we would give wheat under Title I but not sell it for dollars.

In fact, however, the UAR is so low on foreign exchange and its credit so poor that it cannot get the needed US bank guarantees to permit many (if any) dollar sales unless the EXIM Bank will reinsure these guarantees. Thus by authorizing CCC sales, but not allowing EXIM reinsurance, we can have our cake and eat it too—avoid trade and Hill criticism but still keep the UAR on a short rein. I’d add that these small dollar sales generate no adverse publicity. Is this OK?2

R. W. Komer 3
  1. Source: Johnson Library, National Security File, Memos to the President, McGeorge Bundy, Vol. 12. Confidential.↩
  2. Johnson wrote at the bottom of the memorandum: “See me. L.” A note in Bundy’s handwritting follows: “BOB: I think you should do this.”↩
  3. Bundy initialed below Komer’s signature.↩