President Johnson and his top advisors hoped to assist Israel in purchasing tanks from Europe so the U.S. would not have to make the sale and upset the Arab states. They however did not want to arouse suspicion in Congress or among Arab-sympathizers. The discussion also explores tactics to delay any decision and questions are raised regarding Israeli involvement in developing a nuclear arsenal (most notably nuclear-capable missiles).
Memorandum for Record1
Washington, May 16, 1964.
When this item came up Mr. Bundy distributed the draft instructions from the President to Feldman and Sloan for their mission to Israel.
Secretary Rusk queried whether we should say anything about possible economic aid at this time if this seemed necessary to pave the way for Israeli tank purchases in Europe. Feldman thought that this would really be desirable because as he pointed out the Israelis probably did not want secondhand tanks. Their main interest would be in the new British Chieftain. However, this was terribly expensive; hence to steer the Israelis in this direction, we ought to be willing to promise them some indirect help along the line Rusk suggested. Bundy felt this would create a difficult political problem. We had been telling everyone that Israel had done so well economically that it was on the list of those countries which no longer needed US economic aid. Could we say now that it should get more aid, and still carry credibility with the Congress? Rusk thought that the Congress would buy reasonable continued aid to Israel more easily than to any other country. McNamara suggested, as a way out, that we were selling many millions of dollars of equipment to the UK; we could easily knock down the price sufficiently to make up the difference. If the differential between secondhand M-48s or Centurions and new Chieftains was on the order of $150,000, then the total add-on needed might be on the order of $30-40 million.
It was agreed on Bundy's suggestion that this subject should be left for the Eshkol visit itself. However, Feldman could tell the Israelis that if price were a serious problem, we could consider how to help meet it. Feldman thought that if the purpose of his mission was to get tanks off the Eshkol agenda, we must be able to tell the Israelis more than currently seemed feasible. Harman had told him that the Israelis did not want Centurions. The German deal was better, but unfortunately he couldn't tell them at this point that the Germans were signed on. Bundy's view was that we couldn't really take tanks off the Eshkol agenda. We'd have to talk tanks with Eshkol. But we could take them off the "public" agenda if we handled the matter properly.
Feldman asked Secretary McNamara if we could tell the Israelis that we would provide the guns and engines for German M-48 tanks if these were available from Bonn. McNamara seemed to agree, and Rusk pointed out that this would be feasible if we could sell these items through the Germans. Bundy commented that this was the best we could do at the present juncture.
Feldman thought that the best he could come back with under these circumstances was assurance that the Israelis would keep quiet till they could explore tank prospects with the Germans and the UK. Bundy agreed, and felt the Israelis should start on this right now. Feldman warned that the Israelis, if they did not get satisfactory responses, might come back to us about tanks. Again Bundy said we would [have?] to leave this to them. He asked whether the President approved the instructions. The President told Feldman to "get the job done and don't come back without it."
Rusk raised a question about the points on Israeli missiles in the Presidential instruction. Missiles were missiles, even if the UAR variety didn't seem very good; Rusk didn't think the President should tell the Israelis they shouldn't acquire missiles when the UAR had them. He recognized the limited military value of such missiles, but pointed out that they created a major psychological and political problem for Israel. Bundy said the difference was that the Israelis could make nuclear warheads to put on their missiles, while the UAR couldn't. The real issue was whether Israel was going for a nuclear capability. Rusk felt in that case we should focus on the nuclear weapons. This was the risk. Feldman agreed. He mentioned that Eshkol had said he would gladly settle for a 1-2 ratio missiles vis-a-vis the Egyptians. Bundy pointed out that the number of missiles wasn't the issue. The intelligence community thought that Israel's covert program was aimed at a nuclear capability. McCone concurred. The issue, therefore, was one of nuclear proliferation, as Bundy put it.
Feldman suggested he use as a cover story that he was going to Israel to arrange a sale of three million pounds of beef under PL-480, and that he actually sign the agreement while there. This would provide a perfectly legitimate cover. He had also been asked by the Kennedy Library to take BG's recollections for the oral history. This might also provide good cover. The President agreed on the beef story, but felt it inappropriate for a Government official to be going to take oral history interviews. He told Feldman to leave this out.
Sources: Department of State