Foreign Relations of the United States, 1964–1968, Volume XVIII, Arab-Israeli Dispute, 1964–1967

58. Memorandum of Conversation¹

Jerusalem, May 17, 1964.

SUBJECT

• Tanks

PARTICIPANTS

• Levi Eshkol, Prime Minister
• Mrs. Golda Meir, Foreign Minister
• Shimon Peres, Deputy Minister of Defense
• Shimshon Arad, Director, US Department, Ministry for Foreign Affairs
• Uri Lubrani, Political Secretary to the Prime Minister
• Col. Itzhak Nesiahu, Military Secretary to the Prime Minister
• Myer Feldman, Deputy Special Counsel to the President
• Frank Sloan, Deputy Assistant Secretary of Defense
• Walworth Barbour, Ambassador
• Stephen E. Palmer, Jr., First Secretary of Embassy

Note: The meeting took place at the Prime Minister’s residence in Jerusalem the evening of May 17. The Prime Minister could not receive us Monday morning, May 18, the regular weekly cabinet meeting having been deferred until then because May 17 was an Israeli national holiday.

Mr. Feldman outlined the points in the President’s instructions, reiterating a number of observations for emphasis. Inter alia, he explained that the President had been thinking of replying to the Prime Minister’s last communication with another letter, but had decided it would be preferable to send Messrs. Feldman and Sloan to talk with Mr. Eshkol. The President sent warm greetings and asked Mr. Feldman to reaffirm the President’s firm adherence to the commitment of his predecessors to the security of Israel. The Israeli request for tanks had been very thoroughly considered at the highest level of the USG. An important factor in these considerations was how the US could best maintain and expand its influence in the Arab world. We realize there is some difference of view between the USG and the GOI regarding US relations with the Arab states. We feel it is in our mutual best interests that the US retain as much influence as possible with the Arabs. The President has concluded that if the US were to become a major supplier of arms to Israel, especially at this time of particular stress, the situation would polarize dangerously. For instance, such an act could have very negative effects on the Jordan waters situation. In this connection, the President wishes to reaffirm our support for Israel’s utilization of Jordan Basin waters within the Unified Plan. The supply of arms by the US to Israel would severely set back efforts to achieve better de facto relations with Jordan generally. The Arabs would undoubtedly turn to the Soviets for more military assistance. The USG has considered this matter and its ramifications in great depth. We simply could not come to any conclusion other than that we could not be a source of tanks for Israel.

However, Mr. Feldman continued, we recognize Israel’s need for tanks and therefore we have looked into the matter much further. We sent a team, consisting of Mr. Sloan and another expert, to the UK and Germany in order to ascertain how those countries might help. Foremost in our minds were two considerations: (1) Israel’s need for tanks, and (2) the desirability of Israel’s obtaining these tanks at the best possible price.

Mr. Eshkol wryly interjected that Israel would like to receive the tanks free of charge.

Mr. Feldman recalled that when he was last here the Prime Minister and he had discussed the missile problem as well as tanks. He stressed there was no relationship between missiles and the decision we have made about tanks. The USG is prepared to assist in two important ways: (1) we shall assist in every way we can to help Israel get the tanks it needs from the UK and Germany, and (2) in this effort we are willing to supply to the Germans the engines and guns for converting M–48 tanks to M–48A3 models. Although we have no definite assurances either from the British or Germans, we feel almost certain that the UK will supply Centurions on a fairly quick delivery schedule, and that Israel probably can also obtain Chieftains from the British.

Mr. Feldman urged the GOI to go to the Germans as soon as possible regarding M–48s. We are talking to the Germans and will continue to do so. They would have a number of problems in such a deal as we envisage. The need for absolute secrecy in this whole matter is paramount, Mr. Feldman emphasized. It is extremely important that it not appear that the British and Germans have been forced by the US to supply tanks to Israel. Therefore, all discussions about the possible arrangements should be held very closely.

Noting that the implementation of this plan would result in meeting Israel’s tank requirements, Mr. Feldman said that we would like this present talk to serve as a substitution for Mr. Eshkol’s discussing tanks with President Johnson. Chancellor Erhard will be visiting Washington about a week after the Prime Minister leaves the US. If the German government has not responded to the Israeli request for tanks before Erhard arrives in the US, we will put this topic high on the agenda of our talks with him. Mr. Feldman stressed that the projected arrangement was the best possible, and that it would result in Israel’s securing tanks much more cheaply than it could from the US.

The Prime Minister asked what would happen if the German answer were negative. Mr. Feldman said we would prefer not to speculate on that question now. He reiterated the importance of secrecy. He told the Prime Minister that Israel’s friends in the US are being requested not to ask questions about Israel’s arms requirements during the forthcoming delicate period. The Prime Minister should instruct his Embassy to do likewise. If this plan were to become public, its implementation would be rendered impossible. Mr. Feldman urged that the GOI immediately approach the British and the Germans.

Mr. Eshkol asked about financing the purchase and conversion of the British and German tanks. Emphasizing that his figures were necessarily only estimates, Mr. Sloan said M–48s converted to M–48A3s might run somewhere between $120,000 and $135,000 per unit. In his discussions with the British, they indicated they could refit the Centurions for approximately the same figure, although they made no definite commitment on price. The British appeared to be very interested in the possibility of selling Chieftains to Israel, and therefore they will probably be inclined to offer to refit the Centurions for a reasonable price. Mr. Sloan said that the Chieftains would probably sell at about $300,000 per unit, about the same as the German Leopard.

Stressing that what he was about to say should in no way be taken as any kind of a commitment, Mr. Feldman commented that the USG was aware of Israel’s limited resources. We expect Israel to talk more with us about the problem of financing its security needs. However, we cannot furnish the tanks under the military assistance program, on a grant basis. When the GOI has firm prices from the UK and Germany, it can come to the USG for a further discussion of cost. The feeling in Washington seems to be that Israel’s resources are adequate to cover the purchase of the 300 older tanks, but that when it comes to acquiring newer models, we shall be willing to take another look.

Mr. Sloan discussed various technical aspects relating to the German part of the plan. If the Germans can be persuaded to provide M–48 chassis, the cost would probably be less than that which we would have to ask. We would furnish the guns and engines at our lowest book price. The retrofitting would be done in Israel, where labor costs are lower.

Continuing, Mr. Sloan said that leaving aside the political questions, the picture appears to be as follows. The British seem ready to deliver Centurions almost immediately and at a more rapid pace than they indicated in their previous discussions with the Israelis. Further, UK probably would like to sell Chieftains to Israel. It is our hope that the Germans can be persuaded to make up the balance of approximately 300 with M–48s.

In response to a question by the Prime Minister, Mr. Sloan commented further on the cost estimates on the components. In the ensuing discussion, in which Mr. Peres participated, it was noted that if the Germans supplied Israel with M–48s or M–48A1s, they would have to replace these with M–48A2s at greater cost. Mr. Sloan noted that entirely apart from the political problems involved, there simply are no M–48A3s available. In reply to a question by Mr. Peres, Mr. Sloan said the US had discussed tanks for Israel both with the Defense and the Foreign Ministry people in Germany. He too stressed that perhaps the primary problem is that of keeping this whole matter secure. The Germans and the British are extremely concerned about the possibility of leaks.

Mr. Peres and Mr. Sloan discussed additional factors relating to cost and delivery schedules of components. Mr. Peres asked if Israel could not negotiate better prices on the US guns. Mr. Sloan said these prices cannot be reduced; they are our cost prices. If we were to assist Israel on financing, it would have to be done in some other way than changing the item prices. Mr. Peres asked about spares. Mr. Sloan said that both we and the Germans have spares; they present no problem.

Mr. Peres noted that Germany’s problem would not be just a question of money. The Government would have to put it before a Parliamentary committee; maintaining secrecy would be very difficult. He suggested that the US give the Germans a tank for a tank at no extra expense; after all, the M–48 is a dying tank. Mr. Sloan said this would present problems for us. Preliminarily, the Germans seemed willing to exchange models even if this involved extra expense for them. Meanwhile, the US will be cooperative.

In response to a further question from Mr. Peres, Mr. Sloan said we have indicated to both the British and the Germans that Israel’s immediate problem is acquiring a minimum of 300 tanks over the next two or three [years]. We also told them Israel has a total figure of 500 in mind. Both the British and Germans, each of whom is aware that the other was approached, understand that together the problem is to meet the 300 requirement. Mr. Peres said the provision of the conversion kits normally would take a year. Couldn’t we do better than that? Mr. Sloan thought probably we could not, but we would look into it.

The Prime Minister observed there are many “ifs.” Moreover, as far as the Chieftains are concerned, they are extremely expensive. He said he would postpone consideration of the Chieftains for the later tranche of 200; Israel must find cheaper tanks to make up the first 300. Mr. Eshkol asked about the credit terms which the UK might offer. Mr. Peres said they would probably offer three to five years at five and one-quarter percent. The Prime Minister asked if the GOI should approach the Germans; what was the bridge? Mr. Sloan said that while we are quite sure Israel will get a positive response from the British, we are not as sure about the Germans. Israel should approach the Germans now. Mr. Feldman also urged that the GOI immediately approach the Germans.

The Prime Minister said he would like to sum up. The USG has decided that it cannot give tanks to Israel. It is suggesting that Israel go to the UK and Germany. He thought the US part of this arrangement should be to come up with some assistance on financing. Mr. Feldman suggested that the GOI first find out what the prices will be, then ascertain what resources are available, then come to the USG and we will talk further. Mr. Sloan reiterated that in our judgement the provision of 300 units at approximately $125,000 per unit, on reasonable credit terms, is something with which Israel could cope out of its regular budget.

The Prime Minister said it would be a mistake to assume that Israel could afford such a burden. A deal involving some $60 million, even if payments were stretched over ten-fifteen years, is not something Israel could easily bear. Israel’s deficit in foreign currency (sic) is running at $400 million; next year it will be $420 or even $450 million. Israel is having to pay dollars for the Mirages. Mr. Eshkol said he “confessed” that Israel would mortgage everything in order to ensure its security, “but this is a very heavy burden for you to impose on us.” Mr. Feldman suggested taking one step at a time. The first step is to secure the British and German commitments to provide tanks; the Germans will need a lot of persuasion.

Mr. Peres said the IDF is not happy about Centurions. They are inferior to the Soviet tanks which the UAR has. This was the reason Israel did not press the British on the Centurions. The M–48s are far preferable. Mr. Peres suggested that the US supply the conversion packages at a greatly reduced cost, on a surplus basis. Mr. Sloan noted that this would run into serious statutory difficulties.

The Prime Minister expressed appreciation that Messrs. Feldman and Sloan had come to Israel. Mr. Feldman again emphasized the need for keeping this whole matter completely confidential. The Prime Minister said, “I agree.” Mr. Feldman commented that Ambassador Harman has been cooperating in preventing speculation; it would be a good idea if the Prime Mininster requested his Embassy in Washington to continue these efforts, especially while negotiations are going on. If the German Government has taken no decision by the time Chancellor Erhard leaves the US, the USG and the GOI will reconsider the situation in Washington.

Mr. Feldman said that he would like to review his instructions in order to be certain he had left nothing out. He read out the section on the missile problem and the following sentence re tanks: “We intend to see that a comparable alternative is worked out, provided the matter is closely held.”

Mr. Peres suggested that we closely coordinate our efforts vis-a-vis the UK and Germany. He and Mr. Sloan made arrangements to meet May 18th.

The Prime Minister said it was good to know where we stood.

Mr. Peres commented that Israel was very much concerned about the Khrushchev visit to the UAR. Contrary to the USG estimate, Israel is convinced that the UAR missiles are being rapidly improved. Israel is really worried about missiles with conventional warheads, and has reason to fear that the Egyptians are working on chemical warheads. The difference in our respective judgements about UAR missiles is very great, Peres said. Furthermore, Israel would like to take up with the US the problem of its air strength. It needs “a few score” planes that are heavier than the Mirage. The Egyptians are building airfields further and further away from Cairo. If Israel could acquire some light attack bombers, like the Douglas Skyhawks and P–5’s, the Israeli missile program could be “correspondingly limited.” Mr. Feldman said he was not prepared to react on this point.

Mr. Sloan said he hoped it would be possible for Secretary McNamara to give the Prime Minister a thorough briefing on our reaction time and capabilities to come to Israel’s assistance if it were attacked. Perhaps there could be an increased exchange of information of a nature which would help allay Israel’s concerns. The US is confident of its ability to respond to an emergency very quickly. Some quiet exchanges of pertinent information might be very helpful. Israel would find it impossible adequately to face all possible threats by itself.

The Ambassador recalled that he and the Prime Minister had discussed this subject on several occasions. He noted that Secretary Rusk, in a recent speech in Brussels, had stressed the impossibility of any country’s being completely secure on its own.

The Prime Minister remarked that this was all very good. Israel does not doubt US capabilities. What it does doubt is whether, due to world-wide political responsibilities borne by the US, Israel can count on timely US intervention in all contingencies. Mr. Eshkol said that even though the US is the most poweful country in the world, it feels that it cannot even sell Israel some tanks. There ensued a further general exchange on this question, with Mr. Eshkol contending that only after a country becomes militarily very strong does it take up the theme of the inter-dependence of security.

As another group was waiting to see the Prime Minister, the meeting broke up after two hours. Mr. Eshkol again expressed gratification that Messrs. Feldman and Sloan had come to talk to him about this vital problem.

At the meeting the following day between Messrs. Peres, Feldman and Sloan, Feldman stressed again the need for restraint in any public discussion of Israeli security needs in the United States. He said it was his understanding, and he asked that Mr. Peres confirm this with the Prime Minister, that every effort would be made to restrain persons following the Israeli security problems from discussing these problems. He referred specifically to public figures who might be unaware of the delicacy of the negotiations. Mr. Peres said he was sure the Israel Embassy would do its part in cautioning against any discussion during the negotiations.

1. Source: Johnson Library, National Security File, Country File, Israel, Tanks, Vol. I. Confidential; Limit Distribution. Drafted by Palmer on May 18.