In the opinion of the United States Government a settlement of the principal issues of the Israel-Arab dispute is essential if Israel is in the long run to survive. This has become more urgent in view of the apparent intention of the Soviet Government now to seek for its own purposes to implement Arab hostility to Israel.
The United States Government believes that a settlement may be possible if the Governments concerned accept the approach outlined by Secretary Dulles in his August 26th speech, an approach which involves concessions by Arab States as well as by Israel.
It is, however, in our opinion, of the utmost importance that the Governments concerned do everything in their power to maintain calm along the armistice lines, even in the face of provocations. They should cooperate to the fullest with General Burns. Israel, for example, would not seek to compel the settlement of specific issues by force, such as the right of transit in the Gulf of Aqaba.
We believe that it should be recognized that the territorial adjustments referred to in Secretary Dulles’ August 26th speech may have to include concessions in the Negev to provide an Arab area joining Egypt with the rest of the Arab world. These concessions need not, as we see it, involve loss of any appreciably populated land or land of any substantial economic value.
The settlement, outlined by Secretary Dulles’ August 26th speech, would, as there indicated, involve very considerable contributions, both political and economic, by the United States. We believe, however, that it is indispensable that the Governments directly concerned should also be prepared to make contributions. The positive value to Israel of such a settlement, in terms of a prosperous and viable existence, would be incomparably greater than what it is suggested might be required of Israel to procure that settlement.
If the Government of Israel is in accord with the foregoing, it would greatly encourage the United States in its effort to seek a settlement using fully to that end the peaceful influences of which it disposes, and which we believe are not inconsiderable.
SOURCE: FRUS 1955-1957, doc.424