Arab-israel Peace Remote, Eban Reports at Israel Bond Conference

Israel Ambassador Abba Eban, addressing the National Economic Conference for Israel which opened here last night, indicated that he saw little prospect of peace with the Arabs in the next five years. The three-day conference is sponsored by the organization directing the sale of Israel bonds in the United States.

The Ambassador told the 800 delegates that the Israel Government had decided to call on Henry Morgenthau, Julian Venezky and Henry Montor “to accept the responsibility” for planning and launching a new Israel bond issue in the United States in 1954. Mr. Eban added that Israel’s first bond issue, launched in this country in May 1951, brought $160,000,000 in new capital to the Jewish State.

The Israel diplomat scored what he described as “international indulgence to the Arab policy of regional hostility. ” He said that signs of reduced tension in other sectors of the world are not evident in Arab policy “which finds itself increasingly out of harmony with the conciliatory atmosphere of contemporary international relations.”

Referring to Syrian opposition to Israel’s Jordan River project, Mr. Eban noted that “the Security Council’s ban on blockade practices is defied without evoking protest or pressure, while the same Council’s explicit encouragement of development work, provided land rights are respected, is repudiated at the first clatter of Syrian threat.”

STRESSES IMPORTANCE OF MAKING ISRAEL SECURE

In view of the Arab attitude, Mr. Eban stated, Israel “sees no virtue in entreating its neighbors for a peace settlement, which would redound as much to their advantage as to our own.” He stressed the importance of concentrating Israel’s energies to make the state secure.

“We are just as capable of redoubling our strength in the next five years as we were in the first five, and have many other avenues of political and economic consolidation to occupy our effort and resource in the coming years,” he said. “Having endured two millenia without statehood, we should not lack the patience to endure a mere decade without peace if our neighbors so decree.”

Mr. Eban noted that in some circles “we still read and hear the astonishing theory that Israel, smallest and most beleaguered of states, should consider yielding territory to the vast and voracious Arab empire.”

MORGENTHAU WARNS AGAINST INFLUENCING ISRAEL’S POLICIES

Henry Morgenthau, Jr., former U.S. Treasury Secretary, warned the delegates to refrain from using the “power of the purse” to influence the political or economic policies of the State of Israel. Mr. Morgenthau, who is chairman of the Board of Governors of the Israel Bond Organization, said: “The way in which the State of Israel runs its business is its own affair. Whether the Jews of America or any other country use the power of the purse to pressure the State of Israel into certain actions, the violence to Israel’s sovereignty is unforgivable.”

Reporting that since May 1, 1951, the first Israel Bond Issue enlisted more than 600,000 subscribers with total subscriptions exceeding $160,000,000, Mr. Morgenthau said this represented the largest loan obtained directly from the American public by any foreign government since the end of World War II. He emphasized that despite severe hardships, Israel has not defaulted on a single obligation in the five years since her establishment.

Pointing out that Israel could put 250,000 soldiers “on our side,” he said: “in the fast changing European political scene, 250,000 men, representing first class troops, constitute a striking force which the United States cannot and should not overlook.”

Declaring that he thought more could be done to encourage the entry of private capital into Israel, Mr. Morgenthau said he “would like to see the Histadrut get out of private business. ” This remark provoked a protest on the floor from Meyer Brown, leader of the American Zionist Laborites.

U.S. AND ISRAEL ECONOMISTS ANALYZE ISRAEL’S PROGRESS

Leon H. Keyserling, former chairman of the President’s Council of Economic Advisers, told delegates that Israel’s improving economic position lays the basis for the flotation of a second Israel Bond Issue in the United States. Israel is now in a much better position than ever before to fulfill its economic objectives, he said. He pointed out that the initial absorption of immigrants has virtually been completed and the foundations laid for a well-balanced economy.

David Horowtiz, governor of the Central Bank of Israel and former director general of the Israel Finance Ministry, who arrived in the United States two days ago to report on the Israel economic situation, said that Israel suffers from a scarcity of two commodities “without which integration of new immigrants is impossible–time and capital.”

Stressing the importance of the bond issue, Mr. Horowitz said that funds from that source were used to establish 1,466 new industrial plants now producing a widerange of commodities. The phosphate deposits of the Negev, he said, are already supplying the needs of the country for that kind of fertilizer. He said the exploration of copper and iron deposits was already in full swing.

CONGRESSMAN CELLER URGES U.S. NOT TO SEND ARMS TO ARABS

Rep. Emanuel Celler told delegates that he felt the new Administration would be mistaken to send arms to the Arab states, for such an act “would be a strike against peace.” He told the delegates of the Arabs’ hostile attitude and warned that they might resume hostilities if given heavy American arms supplies. He said that the Arabs, instead of directing their hostility against the Soviet Union, have continuously hammered away at Israel.

Sen. James E. Murray, of Montana, told the delegates that he has long been interested in Israel and had met many Zionist leaders and that one who impressed him as among the greatest was Rabbi Stephen S. Wise. This remark was vigorously applauded because it was interpreted by the audience as an endorsement of the late rabbi whose loyalty was questioned in material recently distributed by the House Committee on Un-American Activities.

Dr. Israel Goldstein, chairman of the New York branch of the bond drive, told how Israel’s physical security and political security cannot be viewed “apart from its economic security.” He called attention to plans which have been made to celebrate the 3,000th anniversary of Jerusalem with a massive rally in New York’s Madison Square Garden. He said proceeds, estimated at $5,000,000, would be a gift to Jerusalem to be used to improve that city’s water supply, electric power and industrial development.

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