We came back with less hope in that respect than we had when we went over, primarily because of the intensity of the dispute between Egypt and the British with respect to the Suez business. That is a very critical situation, indeed, and at the time we got there the conversations between the two governments had been broken off

The CHAIRMAN. How about the pistol, was it a good pistol?

Secretary DULLES. And, there was no prospect of resumption, and the British and Egyptians were recruiting-well, the Egyptians were recruiting forces to operate a guerilla force against the base, and the British were making plans in turn which might even have led to a reoccupation of Cairo and Alexandria, which would in turn set the whole Arab world aflame.

Senator SPARKMAN. A few days after you left, Mr. Secretary, after you left Egypt the newspapers carried a story that seemed to carry a little hope on that settlement over there.

I would like to have your comments on that. I am sorry I don't remember the details now, but it seemed that Egypt had expressed a willingness to cooperate with England in the removal of the British forces from the Suez area, and to agree to some kind of an international setup and control of the canal.

Do you know what I am referring to?

Secretary DULLES. I think I know what you are referring to but it has no substance.

Senator SPARKMAN. No substance?

Secretary DULLES. NO.

Senator SPARKMAN. Do you mean it is without fact?

BRITISH BASES

Secretary DULLES. The story has no basis in fact, except to this extent: I talked for 2 or 3 days with Naguib and with a little group of revolutionary leaders who were the real power in Egypt, several colonels and majors, who were the power behind Naguib, and tried to explain to them the fact that that base had a great international importance and could not be looked upon purely as an Egyptian asset, but I didn't get very far.

I flew over the base area, which extends all the way along the Suez Canal area, to a considerable width. There are a series of air strips, big depots of ammunition, vehicles of one kind and another, and there are supposed to be about a billion dollars of military equipment in one or another of these depots, and from them they route that equipment from those bases, the British fly them to their positions in Jordan where they have an Arab League army, and their position in Cyprus, and from which, if there was a general war, in the advanced position along the frontier with Soviet Russia, they would be supplied from there.

Also there is one field which our air people attach much importance to, a base for a strategic operation against Russia. It has been agreed that the British troops will go out. You can't take them out at one time, there are 81,000 of them, or were when I was there, and there are probably more than that now.

Then the question of who is going to operate and manage and supervise the base, and maintain it in a state of readiness in the event of war, that question enters into the matter, and that relates to not only the Suez area, by any means, but to the entire Eastern Mediterranean and the Middle East area, and that requires competent people who know what the stuff is, and how to use it, and who can handle and route spare parts and things that come in, and the Egyptians are not able to take that phase of it over. They think they are, but they are not, and I think everybody will agree to that.

OUTLOOK FOR A SETTLEMENT

The problem of giving this base some kind of an international status is an extremely difficult one. I think probably it can be done. I worked out a formula while I was there which might be mutually acceptable, and I got General Naguib and his followers to agree that they would not start any guerilla operations against the British forces in the Suez until I had gotten back home and had a further exchange with the British to see if we could get the talks going again.

That is one of the urgent matters still to be dealt with, and they are working on that urgently at the Department now. It is tremendously important to find a solution for that.

Churchill has taken a pretty stiff position in relation to it, and his negotiators in Cairo are under very strong instructions not to make any concessions. Churchill is leaning on the theory, maybe rightly or wrongly, that the best way to deal with these people is to be tough, and if they say, "Take your troops out," he sends more

in.

Pending a final agreement, they are concentrating quite a lot of their strength in that area at the present time.

We found in Libya they sent a large part of their airborne troops, and some advance air warning groups, and so forth, which recently had been transported from Libya into the Suez base, and General Roberts, who was there, thinks if things go on this way, it will mean war. We may not call it war, but that is what it will be.

Naguib and his followers are intensely nationalistic and do not have any understanding of the international implications of the Suez base. They are so narrow-minded that we are doubtful as to whether they would ever take a very broad view of these international problems, and also the problem of the British bases is such that even if you find a formula for solution, it would take 2 or 3 years to operate.

There is a strong feeling in that area, and agitation upon us not to give the British anything, not to give any help to the British. They want what we can supply, but do not want us to supply anything to the British, and of course the British feel exactly the reverse about that, they do not want us to give anything to the Egyptians.

I do not think that can be solved in a clean-cut way at the present time by bringing up Egypt in an economic and military way, as we had hoped, and we thought they might be a cornerstone of some kind of a Middle East defense organization.

72-194-77-vol. V-29

REAL DIRECTING FORCE LIES BEHIND NAGUIB

Senator FULBRIGHT. What is your impression of Naguib? Is he a really competent leader?

Secretary DULLES. Naguib is somewhat more of a popular figure than a real power in the government. He is a tremendously attractive man who has a great popular following. He makes great speeches and arouses the masses.

The present government of Egypt depends upon him to get the popular support, yet behind him is a little committee of four who pretty much run things, but they don't have the popular following. Basically, they have the decision and wield the power, they are a combination, they are the revolutionary committee and they could not get the following that Naguib has, because they have not got the popular appeal. Conversely Naguib could not get along without them because he doesn't have the administrative ability or capacity to make decisions which are called for, so it is a combination. Naguib is not single-handedly the strong fellow which he is sometimes represented over here to be.

Senator SMITH. He is bitterly anti-British?
Secretary DULLES. Oh, yes.

Senator SMITH. He has closed his mind?

Secretary DULLES. The whole place is aflame with anti-British sentiment, and the British have quietly been getting most of the women and children out of Cairo and Alexandria, and it is going to take a good deal of skill and undoubtedly some luck to prevent that situation from getting to be pretty bad.

IS THE SOVIET BLOC SUPPLYING ARMS ?

Senator LANGER. Are the Soviets supplying the Egyptians with arms, do you think?

Secretary DULLES. No. There are a number of Germans there, technicians and military advisers, but our information is that that does not indicate that the Germans are in any sense playing politics in the area. They just occur there in a professional capacity. I do not think there is any evidence-do you think there is anything being brought in by the Soviets?

Mr. BYROADE. I am sure not.

Secretary DULLES. They are trying to deal here and there in various places in Europe, but it was found that they were trying to get arms and ammunition but the NATO people have blocked their ability to get arms by preempting them for use of the NATO organization.

We found in Greece that they had been trying to let a contract there for some ammunition.

Senator HICKENLOOPER. Are they trying to get arms from Czechoslovakia?

Secretary DULLES. I don't think so.

Mr. BYROADE. Not that we know of, sir.

FORMULA FOR A SETTLEMENT

Senator SMITH. Could you give us the general nature of the formula that you are working on, or would that be

Secretary DULLES. Well, it is a formula which would, or under which the British troops would effect a staged withdrawal, leaving only nonmilitary personnel there. Then they would attempt to train the Egyptians to handle some of the more technical aspects of this matter, but-that would be the superintendents of the entire organization, including the orders-as to what should be done with the equipment and how the technicians would operate would remain still in British civilian hands, who would get their orders from London, which, however, would go through the British Embassy and military attache there, and would be communicated at the same time to the Egyptian Government, so the Egyptian Government would at all times know what was going on.

One of the points of dispute is whether or not all authority over these technicians would pass through the Egyptian Government. The British take the position, with some reason I think, that if you didn't have any direct way of communicating with these superintendents and technicians, and the only one would be through the Egyptian Government, the chances are that the orders would never get there, not necessarily because of bad faith, but because of lack of competent administration in the Egyptian Government, and they insist that their direct authority over these technicians should con

tinue.

Our own military people attach great importance to the maintenance of the base in such condition as it could be put to immediate efficient use in event of general war, and are rather sympathetic to the British position, although they do not think it is necessary to hold out for the full terms which Churchill at the present time is holding out for. They feel that some modification along the line I described ought to be acceptable.

ISRAEL

Senator HICKENLOOPER. Is there a feeling against the British-is that feeling translated against us, as far as the people are concerned? Secretary DULLES. To some extent, yes. That, however, is primarily due to our supposed position in reference to Israeli more than in reference to the base position.

Most of the animosity with reference to the base is against the British, and most against us is more related to Israel matters than the base matter.

I will go on now to Israel and the surrounding Arab states. Israel has done an amazing job there. They have tried to do a great deal pretty fast, and in the process they have got themselves into economic troubles, and have got a lot of short-term bills outstanding which runs up to roughly $100 million, as I recall, in short-term bills maturing within the next few months. They want somebody to bail them out of that one.

We suggested the best way was to try to make some arrangements with the banks and the exporters who had extended the credit, and maybe they could work out some sort of standstill, without necessarily coming to the U.S. Government, which they would prefer to, to get the loan, where they could fund these maturing bills.

I have a feeling if we start doing that we will find it a continuing process and perhaps their creditors, who have extended too much credit, ought to be compelled, themselves, to sweat this one out.

Senator FULBRIGHT. Who are some of the people. Give us a few examples of who it is that extended this credit, and who they owe

now.

Secretary DULLES. I couldn't give you that. We asked for a sched ule of just who extended this credit, and whether they were banks or whether they were exporters themselves. I don't know whether we ever got that or not.

Mr. BYROADE. We were supposed to get it in a couple of days, but one of them being oil companies

Senator FULBRIGHT. Our own oil companies?

Mr. BYROADE. Yes, sir, some in New York that I know of. Secretary DULLES. Israel is under an economic boycott by the Arab states and that is burdening their economy very considerably. That applies particularly to the inability to use the Haifa refinery, so they can't get oil through the pipeline, and also the movement of goods through the Suez Canal is being blocked by the Arabs.

The leaders of Israel are extremely anxious to get a peace with the Arabs, but I think they realize, which we think is correct, that it is not possible to get such a peace quickly as an over-all proposition. You probably will have to solve these problems bit by bit, rather than doing it all at once.

ARABS BITTER AND FEARFUL

The feeling in the Arab countries is extremely bitter, due to a number of things. First, they are very much afraid of Israel, and think of Israel as an expanding state, and that under the influence of expansion of Zionism they are going to keep bringing more and more Jews in, and they will have to expand.

The military strength of Israel is very great in relation to that of the Arab states, and they can undoubtedly defeat today the combined forces that the Arab states can bring against them.

Their army could march in a few days to Damascus, and there would be practically nothing to stop them.

Now, we are trying to allay that fear through the reaffirmation of the declaration 1 which President Truman made in 1950, in conjunction with the British and French, in which it was said that we would take a very serious view indeed of the situation if any of the states of that area attempted to violate armistice boundaries.

The statement at the time did not have much reassuring weight with the Arab countries, because they felt, rightfully or wrongfully, that actually the influence of the Zionists in this country was so strong politically that in fact anything they did would be con

doned.

I think we may have perhaps created a situation where they will take more seriously a reaffirmation of that attitude by the present administration, and that may help to eliminate the fear that is felt in the Arab countries.

I might state also that there is a reciprocal fear on the part of Israel that if they do not maintain a strong military establishment, the Arab states will gang up and finally organize enough strength to put them out in the sea.

So, it is important to allay those fears on both sides.

1 The Tripartite Declaration regarding security in the Middle East, issued by the United States, Great Britain, and France on May 25, 1950.