The Chairman

by Kai Bird

  His message delivered, McCloy went back to Teheran to deal with Allied Chemical’s problems. He told Prime Minister Amir Abbas Hoveyda that Allied was doing its best to keep the chemical-plant project on a sound economic footing. “It [Allied] did not appreciate,” McCloy said, “having its efforts met with charges of bad faith. . . .” Hoveyda accepted these assurances. Confidentially, however, McCloy told the American ambassador that the enterprise was now not $25 million over cost, but as much as $75 million over the original estimate.170 The project would probably never be economical, and critics would later cite it as one of those “white elephants” that drained the country’s resources and contributed to the revolutionary upheavals of the 1970s.

  On the Arabian Peninsula, McCloy continued his mission of private diplomacy. In Bahrein, he assured the ruler, Sheikh Isa, that the shah “had no intention of using force to take Bahrein.”171

  In Riyadh, capital of Saudi Arabia, he had an audience with King Faisal and tried to persuade the Saudi monarch that he could patch up his differences with the shah. He suggested that the shah just needed to be “more fully consulted on future decisions on Gulf” issues. All the parties in the region needed to exercise a little “statesmanship.” Faisal indicated that his real concerns lay not with the Iranians but with the general threat of communism in the region. U.S. policies regarding the Arab-Israeli conflict were only giving the communists greater popular support. McCloy argued with Faisal. Later, he met with Petroleum Minister Zaki Yamani and a number of influential Saudi princes. Breaking with protocol, McCloy refused to allow the American ambassador, Herman Eilts, to sit in on all his meetings with the Saudis. He wanted to be able to speak privately and with the kind of frankness most diplomats avoid. Based on what he later heard from the Saudis, Eilts reported that McCloy’s visit, “even though private, was very useful. From what I hear . . . McCloy stood up strongly and effectively, yet sympathetically, to Saudi critics of U.S. policies. Saudis, including Faisal, welcome such opportunities [to] air their worries to distinguished private Americans.”172

  Actually, Eilts would have been astonished if he had known just how far McCloy had gone in his conversations with Faisal. In his free-wheeling style, McCloy had explored the possibility of a comprehensive settlement of the Arab-Israeli dispute. Subjected to the lawyer’s gentle prodding, the Saudi king had said he could accept a settlement with Israel based on U.N. Resolution 242, which called for a peace settlement based on Israeli withdrawal from the occupied territories and mutual recognition. Significantly, Faisal was willing to compromise on such contentious issues as the continued Israeli occupation of the Golan Heights and the status of Jerusalem. He proposed a complicated formula whereby Jerusalem would remain united, while simultaneously allowing for the creation of a free Islamic sanctuary within the Holy City. McCloy was excited by these proposals and eager to see if he could extract similar concessions from other Arab leaders.

  Over the next ten days, he saw King Hussein of Jordan, the president of Lebanon, and finally Nasser. The latter appointment was fixed only at the last minute, and an official record of his conversation with the mercurial Egyptian leader does not seem to exist. But it is clear from McCloy’s private correspondence that Nasser was eager to have the United States broker a peace settlement. The Egyptian suggested that, since Johnson was no longer a candidate for president, perhaps he would be freed politically to implement a solution to the Arab-Israeli conflict on the basis of an “equitable interpretation” of U.N. Resolution 242. McCloy then carefully extracted from Nasser what he thought would constitute the details of a comprehensive settlement. By the time he left Egypt, he felt he had a “package” peace settlement practically in his pocket.173 “It included,” he later wrote George Ball, “Israeli use of the Canal, Resolution 242 supplemented by demilitarized zones, continued Israeli occupation of the [Golan] Heights with Feisal ready to work out a free Moslem sanctuary in Jerusalem, with Egypt’s recognition of Israel and support by the Western European countries as well as the Soviet Union in the settlement. I really had a package in regard to which I was quite optimistic after my talks with Nasser, Hussein and Feisal.”

  Here was a chance, he thought, to restore American interests in the Arab world. Upon arriving in New York, he immediately called Walt Rostow in the White House and scheduled an appointment with the president. In the meantime, he lined up support from Siegmund Warburg and a few other Jewish leaders who endorsed the broad outlines of the package. One week later, he went to the White House and for forty minutes briefed the president, Dean Rusk, Clark Clifford, and Joseph Sisco, an assistant secretary of state. McCloy tried to make the case for a major change in U.S. policy. Everyone acknowledged that he had brought back dramatic concessions from the Arabs, but Clifford said bluntly that a broad U.S. peace initiative could not be launched in an election year.

  McCloy thought the president was at first eager to pursue the matter, “but he simply faded away after Clifford’s discouragement.” Rusk, as usual, sat in silence. McCloy came away from the meeting thinking he had “failed rather completely” in making his point. Back in New York, he sat down at his desk and drafted a long letter to Rusk. The president, he wrote, seemed to think the only problem at hand was the rupture in diplomatic relations. This was really inconsequential to the main problems: the need to avoid another Arab-Israeli war and the need to “repair our power and influence in what is probably the most strategic area in the world.” Another war might lead to another Arab defeat, but it could just as easily lead to a superpower confrontation. He then predicted:

  Nasser has had his [military] material replenished, but he is not yet ready for another gamble. He intends, I think, to undergo a long period of training with his Soviet technicians before he tries the game again. He doesn’t have the pilots now, but he does think seriously in terms of renewed war as long as Arab territory is occupied by the Israelis, and, in my judgment, it will come some day if steps are not taken during this interim period to avoid it.

  The Soviets were exploiting “our partiality to Israel” in order to achieve their century-old ambition to turn the Mediterranean into a Soviet sea. There was a danger that they would in a few short years replace the British as the hegemonic power in the region, thus outflanking NATO from the south. Seventy percent of all the oil consumed by Western Europe and 80 percent of that consumed by Japan came from the Middle East. He warned that if the United States lost control over the marketing of this oil, America’s already discouraging balance-of-payments picture would be “radically impaired.”

  Things should not be allowed to deteriorate any further. “The simple fact,” he wrote, “is our Israeli policy is not operating in favor of our national interest in the Middle East. . . . We cannot afford to have our national interest overridden by a policy which would preclude us from taking any position opposed to further Zionist ambitions.” Though Israel deserved to have firm international guarantees of her security, she had to be confined to within her pre-June 1967 boundaries. “The issue, in short, is really one of [Israeli] expansion. Moreover, it is, I believe, entirely in the long range interests of Israel that such ambitions be curbed. . . .” The president should appoint someone of experience and stature, some one like former under secretary of state Livingston Merchant, to implement a settlement based on U.N. Resolution 242. To be sure, the Arab states would have to end their attitude of belligerency and recognize Israel. Portions of the Golan Heights, the Sinai, and the West Bank should be demilitarized, and then something would have to be done about the Palestinian refugees. Such a high-level effort at a comprehensive settlement might not succeed, but McCloy concluded that “the situation should not be permitted to drift without a sustained and imaginative effort on our part to anticipate the coming trouble and further loss of United States position in an area vital to us and to our allies.”174

  This was, of course, a succinct exposition of the views held by his oil-company clients. But it was an opinion McCloy had personally held ever since h
e first visited Jerusalem in 1943. The important thing to U.S. national interests in the Middle East was not Israel but oil. In McCloy’s view, the creation of Israel, and Truman’s hasty recognition of it in 1948, had not altered those strategic interests. The Jewish claims on Palestine had been a complication then, and, unfortunately, they were still a complication. The solution, seen from McCloy’s legalistic approach to the problem, was to treat Israel’s cease-fire lines as an internationally recognized boundary. “The whole concept,” he told Rusk, “of the Palestinian homeland, and Israel itself, precluded expansion. It was a limited area carved for outside settlement from an already occupied area.” Now that Israel had expanded beyond those cease-fire lines, she should be asked to exchange the newly occupied territories for a comprehensive peace settlement.

  It would have taken any administration a great deal of political courage, self-confidence, and determination to accept such recommendations. But in April 1968, barely a month after the war in Vietnam had ended Lyndon Johnson’s hopes for a second term, this administration had none of those qualities. McCloy’s letter was knocked around the State Department for three weeks before Rusk finally responded with a short note thanking him for his “thought-provoking comments. . . .” The administration, however, was going to wait and see what became of a new round of U.N. talks. Realizing that McCloy would hardly be satisfied with such a meager response, Rusk agreed to have Luke Battle call up the lawyer and explain the administration’s position in more detail. Battle then had to carry out the awkward job of explaining to McCloy over the phone that the administration felt his proposal was too risky. Failure to make real progress toward a settlement might itself stimulate another war, a Soviet-U.S. confrontation, and “long-term losses to the U.S. position.” The State Department would play it safe.

  McCloy was severely disappointed, and later blamed Clifford, the president’s “white-haired boy at that time,” and Rusk, who “simply failed as usual to seize the initiative.”175 The Johnson administration was, in any case, on its way out. Since the Republicans certainly had a good chance of winning the White House in November, he thought perhaps his advice would be listened to more closely by those who succeeded Johnson.

  BOOK VII

  Elder Statesman 1969–1989

  CHAPTER 27

  The Establishment at Bay: The Nixon-Kissinger Administration

  [McCloy was] “a reliable pilot through treacherous shoals. . . . He was always available. He was ever wise.”

  HENRY KISSINGER

  Though his memories of Richard M. Nixon’s red-baiting during the 1954 congressional campaign had not faded, McCloy still thought of himself as a loyal Republican. As he cast his vote in 1968 for the Republican nominee, he only hoped the “New Nixon” had become a more mature and seasoned politician. When Nixon narrowly won the election, McCloy had no expectations that he would become part of the new administration’s inner circle. The new president was insecure among the men who ranked as elder statesmen in the Eastern Establishment. As Henry Kissinger would later write, these were men whom Nixon “revered and despised, whose approbation he both cherished and scorned.”1 Nixon had not forgotten how some of these Wall Street Republicans had tried to ease him off the ticket in 1956; he was suspicious of them, though his political instincts told him that he needed to be seen seeking their counsel. So, for rather ambivalent reasons on both sides, McCloy found himself on Nixon’s postelection foreign-policy transition team. His presence was mere window-dressing.

  Henry Kissinger was another matter. Here was a man who had all the necessary Establishment credentials—Harvard, the Council on Foreign Relations, and a long-standing relationship with Nelson Rockefeller, who had been Nixon’s only real rival for the nomination. And yet Nixon sensed in Kissinger a kindred spirit, a desperately ambitious man who as an immigrant would always remain an outsider, insecure about his standing with the Establishment. He knew that Kissinger had called his thirty-two-year-old foreign-policy adviser, Richard V. Allen, and offered to keep him informed during the campaign about the Paris peace talks. Kissinger had said their contacts would have to be secret, so as not to close off his access to the Democrats. Allen’s major worry that autumn had been that Johnson’s envoy to Paris, Averell Harriman, might suddenly achieve a breakthrough in the talks and bring home the kind of peace settlement that could throw the election to Hubert Humphrey. So he was more than grateful that Kissinger was willing to use his friendship with Harriman to keep the campaign informed on any last-minute “October surprises.”2 Kissinger served Nixon well, all the while assuring his Democratic friends that he favored Humphrey.3

  McCloy had been unaware of Kissinger’s activities that autumn. He recognized that the younger man had a “fine mind.” But he always thought him a bit too calculating, and occasionally he would complain to friends about “Henry’s opportunism.”4 Years later, when Kissinger brought out his two volumes of memoirs, McCloy judged them “defensive and not good history.”5

  Kissinger went to great lengths to associate himself with men like McCloy, Acheson, Lovett, and Harriman. These were men, he said, who “represented a unique pool of talent—an aristocracy dedicated to the service of this nation on behalf of principles beyond partisanship.” Of all these men, Kissinger wrote, there were none he saw more frequently during the transition period than McCloy, whom he described as “a reliable pilot through treacherous shoals. . . . He was always available. He was ever wise.” Such flattery aside, the truth was that neither during the transition nor afterward did Kissinger very often act upon McCloy’s counsel. He thought McCloy’s “penchant for anecdotes” “time-consuming” and his intelligence was “balanced rather than penetrating.”6

  Early in the Nixon administration, McCloy took David Rockefeller and a number of his oil-company clients in to see the new president. Oil-company executives like Rawleigh Warner of Mobil and Robert Anderson of Arco had contributed heavily to Nixon’s campaign and expected his administration to protect their interests. McCloy briefed the president and Kissinger on his conversations with Nasser, and the oil men urged Nixon to launch a major initiative to achieve a comprehensive Middle East peace settlement before the situation deteriorated further. Nixon seemed sympathetic; he boasted that this was one president who was not indebted to the Jewish vote. But nothing happened, and later Warner complained, “We could always get a hearing, but we felt we might just as well be talking to that wall.”7

  Kissinger had already decided not to stick his neck out on the Middle East. Early in 1969, he did everything he could to block the State Department’s efforts to launch a major peace initiative. When Nasser wrote a personal letter to Nixon, suggesting that diplomatic relations could be restored if only the United States would “break the ice” with some gesture such as holding up the sale of F-4 Phantom jets to Israel, Kissinger persuaded the president to dismiss this overture as nothing more than the machinations of a “Soviet client state.”8 When McCloy heard from his own sources what had happened, he was appalled by Kissinger’s misjudgment of Egyptian intentions. He felt that, if Washington continued to remain aloof from the conflict, another war would result, which would further jeopardize U.S. control of Arab oil. He thought Kissinger shortsighted.

  McCloy’s uneasiness about Kissinger was not mollified by his dealings with the White House aide on arms-control matters. As chairman of the President’s General Advisory Committee on Arms Control and Disarmament—a position he had held since 1961—McCloy was supposed to sign off on any major recommendations to the president concerning arms-control measures. He and his fellow committee members—Dean Rusk, Cyrus R. Vance, Harold Brown, U.S. Air Force General Lauris Norstad, William C. Foster, a former chief of the Arms Control and Disarmament Agency, and William W. Scranton, former governor of Pennsylvania—were given regular top-secret briefings on U.S. and Soviet strategic weapons. By law, McCloy reported directly to the president, and his Committee’s reports had usually been accepted as the consensus in the defense community. But i
n 1969–70, Kissinger systematically deflected the recommendations of what was informally known around Washington as the “McCloy Advisory Committee.”

  In retrospect, many arms-control experts and historians judge that the United States lost an opportunity in these years to place a cap on the arms race. With the opening of the first Strategic Arms Limitation Talks (SALT) in 1969, two critical issues had to be decided by Soviet and American negotiators: whether to ban defensive antiballistic missiles (ABMs) and whether a similar ban should be imposed on the deployment of multiple independently targetable re-entry vehicles (MIRVs). Both questions dealt with the issue of whether the two superpowers could control technologies that threatened to lower the threshold of nuclear war. The Soviets were eager to negotiate an ABM treaty and gave every indication that they would also agree to ban MIRVs. But by the spring of 1969, Kissinger said, he had concluded that a ban on MIRVs was politically unpalatable.9

  On March 10, 1970, the McCloy Advisory Committee strongly recommended a ban on both ABMs and MIRVs. Kissinger was extremely upset, recognizing that McCloy’s conservative credentials would lend considerable support to the arms controllers in the administration. In his memoirs, he suggests that McCloy was merely reflecting the prevailing mood. Actually, McCloy had adopted this position after considerable thought. In part, he was influenced by a January 1969 Council on Foreign Relations report to the president-elect which had concluded that an early arms-control agreement with the Soviets was “imperative.” Significantly, the report recommended a unilateral moratorium on MIRVs. McCloy felt that, though the United States was ahead in MIRV technology, it would only be a matter of years before the Soviets began placing multiple warheads on their missiles. Besides, he knew that MIRV technology had been developed in response to the Soviet deployment of antimissile defense systems. If the Soviets were now ready to limit such systems with an ABM treaty, there was no need to deploy U.S. MIRV missiles. Multiple warheads not only represented a quantum leap in the nuclear-arms race, but also made any future arms-control agreements difficult to monitor. One would not know, from counting missiles, how many independently targetable warheads existed. Worse, in a few years there would be so many multiple warheads that each superpower might be able to threaten the survivability of the other’s land-based ICBMs in a surprise first strike.10 When Paul Nitze argued that the United States should not give up a technology in which it was ahead, McCloy brusquely commented that he was “crazy.”11 There was no doubt in his mind that, if the Soviets were willing, the Nixon administration should jump at the chance to ban the technology.12