WILLKIE’S CALL FOR THE “GATES OF PALESTINE” TO BE OPENED TO Jewish refugees reflected the growing strength of the Zionists in the United States. When shortly it was followed by the American landings in northwest Africa and the British victory at El Alamein, the call triggered euphoria in Palestine and then a tremendous sense of urgency that would spread across and destabilize the Middle East.
Even before Churchill advised caution at the Mansion House, in Palestine the leading Zionist David Ben-Gurion had latched onto the feeling that the war would soon be over. He urged the Jewish people to organize themselves because a peace conference, at which the Palestine question would undoubtedly be raised, was in the offing.
Ben-Gurion was head of the Jewish Agency, which represented the Jewish population of Palestine in its dealings with the British, and he had long felt that the Zionists needed to be more demanding. He had been in America when the Struma sank, saw which way the wind was blowing, and encouraged American Zionists to hold the Biltmore Conference, which then proved there had been a sea change in Jewish opinion that favored the Revisionists. Now back in the Mandate, he urged his colleagues on the executive committee of the Jewish Agency to accept the Biltmore Program. Although this was a move that they had previously rejected because they disliked the Revisionists, the shift of Jewish opinion in the Revisionists’ favor was so obvious that they gave in to Ben-Gurion’s demand on November 10, 1942—the same day that Churchill spoke at the Mansion House.
A fortnight later Ben-Gurion announced that the Biltmore Program would form the agency’s “main demand” at the peace conference. To this end, he said, the agency would press for the establishment of a Jewish army and promote Palestine’s ability to accommodate “large masses of Jews.” This prospect caused Arab uproar and British alarm, but Ben-Gurion did not care. “There will be disturbances,” he would acknowledge later. “The weeks and months following the collapse of the Hitler regime will be a time of uncertainty in Europe and even more so in Palestine, and we must exploit this period in order to confront Britain and America with a fait accompli.”1
The Arabs soon reacted to Ben-Gurion’s proposal. Days later, the Iraqi prime minister Nuri al-Said unveiled a plan of his own, which he dubbed the Fertile Crescent Scheme. In it he called on the Allies to reunite Syria, Lebanon, Palestine, and Transjordan and guarantee the Jews only a degree of autonomy in Palestine. This state would then link up with Iraq to form an Arab League, which other Arab states could also later join. It was, he claimed, “the only fair solution… the only hope of securing permanent peace.”2
The British, from Lawrence of Arabia onward, had long encouraged dreams of Arab unity. This was partly to make up for the fact that the territory that the Hashemites had acquired after the previous war—Transjordan and Iraq—fell far short of the much larger empire that the British had promised them in order to secure their help against the Ottomans in the war. Once more, British officials in Cairo ranged themselves behind their old ally Nuri al-Said’s scheme. They feared that Ben-Gurion’s announcements would provoke an Arab backlash in Palestine and destabilize the entire region. For them the Fertile Crescent Scheme represented a way to bolster the moderate Jews who distrusted Ben-Gurion and reconcile the Arabs to a permanent Jewish presence and so prolong Britain’s role in the Middle East long beyond the end of the war.
The man who took on the responsibility of trying to turn this idea into a reality was Lord Moyne. Quiet, slight, and self-effacing, with steel-gray hair and turquoise eyes, Moyne was another old friend of Churchill’s, a millionaire with a distinguished war record who had ditched a career in politics to indulge a love of adventure in the 1930s. “He had a passion for the sea, and for long expeditions to remote places,” a contemporary recorded. “He collected yachts, fish, monkeys and women.” The British foreign secretary Anthony Eden recollected a less frivolous side to the adventurer, which he had witnessed during the Great War. Moyne was, he said, one of those men “who could discipline themselves to be insensitive to danger and who lacked neither brains nor imagination.” It was for precisely that reason that Churchill dragged his old friend back into government in 1940, and then sent him to Cairo in August 1942 to serve as deputy to the top British official in the Middle East, the minister of state. Moyne’s true task was to ensure that, if Rommel broke through, the British followed the prime minister’s order to fight to the last man.3
Moyne was spared this fiery denouement by the decisive victory at El Alamein. Briefly, he felt “definitely under employed,” but the sensation was short-lived. Having served as colonial secretary in Churchill’s government in London, he understood the Palestine question well enough, and he appreciated that the victory would unbottle long-standing tensions that Rommel’s nearness to Palestine had previously stilled. In a series of letters to a friend, he confided “grave anxieties as to the future” as “fears of the Axis die down and animosities revive.” That sense of foreboding would prove to be entirely justified, for Moyne would ultimately be murdered by Zionist extremists.4
TURNING THE FERTILE Crescent Scheme—or Greater Syria, as the British often called it—from a dream into reality was no easy task. Not only could Moyne expect to encounter opposition from Ben-Gurion, but the Arab world was by no means united behind Nuri’s scheme. Moyne soon discovered that the plan’s association with the Hashemites alarmed one man in particular. No sooner had Nuri spoken out than Moyne received an invitation from Ibn Saud, the king of Saudi Arabia, to come to see him. He was to meet the king in the Red Sea port of Jeddah at the very end of 1942.
Ibn Saud had long regarded Nuri’s Hashemite patrons as his main rivals. After capturing the city of Riyadh—where, legend had it, he had thrown the city governor’s severed head into the waiting crowd—he had then forced the Hashemite ruler sharif Hussein out of the holy city of Mecca in 1924. By then, however, thanks to the British, Hussein’s son Feisal had become king of Iraq, while Feisal’s brother Abdullah was emir of Transjordan. What that meant was that Ibn Saud was boxed into the Arabian Peninsula by two neighbors whom he was certain still wanted to avenge their father’s overthrow. They would be more threatening still if, as Nuri al-Said envisaged, they were able to unite.
The Hashemite threat would obsess Ibn Saud for the remaining eleven years of his life. Already by 1942 it was a menace that he felt ill equipped to meet. Though, at over six feet tall, he towered over Moyne, the legendary warrior was a shadow of his terrifying former self. Now in his early sixties, he was half blind from a cataract, and an old war wound meant he could no longer climb the stairs. He tried to quash rumors of his declining virility by descending on the tribe where the gossip was prevalent, selecting a bride, marrying her, and then consummating the marriage behind the woolen walls of the royal tent.
Frailty was one weakness. A desperate shortage of money was another. In 1933 the king had granted exclusive rights to drill for oil within his kingdom to an American firm, the California Arabian Standard Oil Company (CASOC), but the company did not strike oil until 1938. The outbreak of war the following year disrupted the embryonic market for Saudi oil and, more importantly, the pilgrimage, which still provided Ibn Saud with the vast majority of his income, plunging the kingdom into a financial crisis. A drought made matters worse. The crisis had dire implications for the ageing king because he bought the loyalty of his Bedu subjects.
Fearing that his Hashemite rivals would exploit his weakness, Ibn Saud leaned on the British and the oil company for funds. The company feared the British, who had helped him out during the previous war, might try to extract a quid pro quo for their support. And so it rashly promised a $3 million advance against future royalties in early 1941, before asking the U.S. government to reimburse it. When Roosevelt refused—on the grounds that Saudi Arabia seemed “a little too far afield for us”—a compromise was reached whereby the British government funneled both American money it had borrowed and Lend-Lease aid to Ibn Saud. In 1942 the British would pass on £3 million in this way.5
If Moyne hoped that this money might influence Ibn Saud’s reaction to the Fertile Crescent Scheme, he was to be disappointed. “Our talk ranged over many subjects,” he recalled afterward, before the conversation reached the matter he had been summoned six hundred miles to discuss. Speaking in a hoarse whisper, the old warlord used his audience to register his hostility to Nuri’s plans. The king was not averse to closer economic ties among his northern Arab neighbors, but when Moyne raised the prospect of an Arab federation uniting them, “he gave no encouragement to this idea.” It was a disappointing answer from a man the British still regarded as their client, who, they were always glad to see, wore socks with “Pure Wool—Made in England” printed on their soles.6
THE JEDDAH MEETING confirmed Moyne’s suspicion that a more gradual and innocuous approach was needed. It was probably no coincidence that another British ally, the prominent and moderate Zionist Judah Magnes, made just such a proposal the next month. Writing in the American journal Foreign Affairs, Magnes, who was president of the Hebrew University in Jerusalem, proposed the establishment of a binational Palestine within a broader Arab federation, exactly like the one that Nuri al-Said had already described. Since that was “delicate and complicated,” he suggested that the first step was an economic union. “One way of forming this very desirable economic union,” he ventured, “might be to develop the Middle East Supply Center to its full capacity for usefulness.”7
In theory a joint Anglo-American agency but in practice British dominated, the Middle East Supply Centre had been set up in 1941 after the war closed the Mediterranean to merchant shipping, which now had to go round the Cape to reach Egypt. At a time when ships were in very short supply and when the Middle East imported five million tons of food each year, the centre’s task was to keep the local population and the armies that were based there fed, using as little shipping as possible. When its officials quickly realized that the best way to do this was to increase the region’s self-sufficiency, they wrote their organization a license to interfere. They were soon setting import quotas and redistributing American Lend-Lease aid to the countries of the region; by 1943 the centre also controlled all internal transport and advised on agricultural techniques, irrigation, and industry. It even ran an anti-locust unit, which had acquired the right to roam across the Middle East because, as its director was known to say, “the political troubles, when the locusts copulate, are immense.” Although Magnes made the case for using the centre in public, in private Moyne was arguing for exactly the same extension of its powers beyond the war’s end. The centre would form the executive agency of a Middle East Economic Council, comprising representatives of the region’s states and delegates from the United States and Britain naturally, whose task would be to manage a glacially paced transition from war to peace.8
American involvement was crucial for this plan to work. From the battle of El Alamein onward, the British began trying to convince their American counterparts that the Middle East Supply Centre was the answer to the problems that Willkie had identified. After being briefed by the centre’s director, the British weekly The Economist suggested that “a revised MESC, representing the United Nations, could provide the capital, the machinery, the experts, the advisers, the educationalists without which there can be no speedy raising of Middle East living standards, no end to the recurring crises of want, little genuine political cooperation and little hope of the area being withdrawn finally from the struggle for predominant influence between the Great Powers.” It was only in private that Moyne and his colleagues admitted why they were actually so keen to keep the centre going. Britain’s control of this obscure yet powerful bureaucracy offered “one of the most hopeful means of keeping the general initiative in the Middle East in our hands.”9
A LONG-TERM BRITISH strategy was taking shape and might succeed—that was, if the Zionists did not seize the initiative from the British first. By April 1943, the British had enough intelligence to convince them that the Zionists were going to use force to get what they wanted. Ben-Gurion’s Jewish Agency was devoting 15 percent of its annual budget to “internal security,” which, they believed, meant arming the Haganah, an eighty-thousand-strong, illegal paramilitary organization, partly with weaponry it was buying secretly from the French in Syria, partly through well-organized and large-scale theft from British forces based in Palestine. In one month alone, six hundred rifles, twenty machine guns, ammunition, and three tons of explosive disappeared from British depots in the Mandate. A bug or an informer enabled the British to eavesdrop on a meeting at which the head of the Haganah spoke. “We all know that the Zionist problem will have to be solved one day by force of arms,” he said. “It can never be solved by political argument; only by a fight.”10
After seeing an intelligence report that suggested the Haganah was reconciling its differences with more extreme Jewish terrorist groups, Moyne’s boss, the minister resident Richard Casey, decided that it was time to alert London. In April 1943, he warned the British government that Palestine was “heading for the most serious outbreak of disorder and violence which it has yet seen… as soon as the War ends in Europe, or possibly a few months earlier.” There were differences of opinion over exactly what would trigger renewed violence, he admitted, “but of the certainty of the outbreak, unless it can be averted by some action of the British Government, there is no doubt.”11
Casey’s own view was that the most likely cause of war would be a Zionist attempt to engineer Ben-Gurion’s fait accompli, and he now put forward an idea to preempt it. In his view, the Zionists’ noisy public relations campaign was designed to win over, or at least divide, public opinion in the United States and Britain so that the governments of both countries would have to acquiesce when finally the Zionists struck. To disrupt this strategy, Casey proposed that the British and the American governments should both state publicly as soon as possible that they would not tolerate any “forceful changes” to the administration of Palestine and in particular the “forcible establishment of a Jewish State.”12
There was no guarantee that either government would want to make such a statement—both had done their utmost to say as little as possible on the subject. In an attempt to end this silence, Casey and his colleagues had already decided to work on the Americans first of all, using a devious and roundabout approach.
Reckoning that the Americans would pay more attention to secret intelligence they had received from one of their own agents than shrill warnings from London, the British decided to feed what they knew to an American spy in Cairo. Colonel Harold Hoskins of the Office of Strategic Services (OSS) had appeared in the Egyptian capital at the end of 1942, tasked with writing an appraisal of political developments in the Middle East and establishing a base for his organization in the region. The British had never wanted him to come, but after trying and failing to stop him from doing so, they realized that he might have his uses, for Hoskins was extremely well connected, counting President Roosevelt and the number two at the U.S. Department of State, Sumner Welles, among his friends. The son of American missionaries to Syria and a fluent Arabic speaker, he was also no friend of the Revisionists.
Given how the British had strained to stop Hoskins from coming, the access to Cairo’s secret world that they now gave him is striking. Within four days of his arrival, he was introduced by Casey to the heads of MI6’s and Special Operations Executive’s regional operations and the local representatives of the Political Warfare Executive and the Ministry of Information. Casey then gave him a lift to Beirut on his plane.
The upshot of these efforts was that on April 20, 1943, Hoskins informed Welles, in terms that parroted Casey’s own warning to London, that a “renewed outbreak of fighting” in Palestine was likely. To make Roosevelt take notice, he warned that renewed Arab-Jewish conflict in Palestine had important implications for the United States domestically because it might lead to a massacre of Jews living in the neighboring Arab states and militarily because it might destabilize Arab North Africa, threatening the security of Eisenhower’s forces, which were now based there ahead of the invasion of Europe.
Hoskins went on to suggest that the best way to avoid violence in the short run was for the Allies to issue a statement promising that “no final decisions” regarding Palestine would be taken until after the war’s end, and then “only after full consultation with both Arabs and Jews.” As for the longer term, he proposed a solution that was a hybrid of Judah Magnes’s and Nuri al-Said’s schemes: a binational Arab-Jewish state within a broader Levant federation. Hoskins’s recommendations had British fingerprints all over them.13
A few days later, Casey and his top officials met and confirmed their plan to prolong the life span of the Middle East Supply Centre, preferably in concert with the U.S. government, beyond the war’s end. The Americans were not invited to this secret conference, but they knew that it was taking place. Immediately afterward, Casey was buttonholed by the American ambassador to Cairo. He “asked me straight out what we had been discussing,” the minister resident reported. “In the circumstances I could tell him nothing more than generalities.”14
RICHARD CASEY’S EVASIVENESS only fortified American suspicions about British activity in the Middle East. These had been growing since the moment earlier that year when it dawned on the Americans that the British were using Lend-Lease aid to bolster their own standing in the region, at American expense. In January 1943, soon after Ibn Saud was heard observing that while “America can supply nearly everything… if we want anything we go to the British and the King of England sees that we get it,” the American ambassador to Cairo decided that it was time to find out what the Middle East Supply Centre was up to. After a visit to Jeddah, he reported that the United States had “lost considerable prestige in the eyes of Saudi Arabians who have been given increasingly to feel that the British were their only friends in need.”15
While American diplomats fretted about prestige, American oilmen were more worried about money. CASOC’s executives and owners both feared that the king might cancel the company’s concession and award it to the British if he could not afford to pay them back. In February, the president of CASOC and its two shareholders approached the Roosevelt administration with a plan. If the U.S. government picked up the Saudi kingdom’s debt to Britain, the company would give the government oil of an equivalent value.
This idea appealed instantly to the secretary of the interior Harold Ickes, whose concurrent role as petroleum administrator for war made him responsible for husbanding U.S. oil resources. A paternalist who practiced what he preached—he was married to a woman forty years his junior—Ickes had long argued that the United States government should follow Britain’s example in taking strategic stakes in companies with foreign oil concessions because oil was a finite resource and oil production in the U.S. would shortly start to fall. CASOC’s proposal was a significant step in the direction of his own philosophy.
Over lunch with Roosevelt on February 16, 1943, Ickes warned the president that the British, who “never overlooked the opportunity to get in where there was oil,” were “trying to edge their way into” Saudi Arabia, “probably the greatest and richest oil field in the world.” Roosevelt’s in tray already contained a request to extend direct Lend-Lease aid to Saudi Arabia in order to stop British middlemen taking credit for disbursing American generosity, and following the lunch the president promptly signed it off. “I hereby find the defense of Saudi Arabia vital to the defense of the United States,” he declared two days later, a calculation that has underpinned the American relationship with the Saudis ever since.16
With American forces now stationed in North Africa, Roosevelt was suddenly paying much closer attention to the politics of the Arab world. At the end of March, he dispatched another envoy to the region. Patrick Hurley was a Republican who had been Hoover’s secretary of war before becoming an enthusiastic supporter of the New Deal; since the beginning of the war, he had performed a number of diplomatic missions for Roosevelt. On this latest, Hurley would be the president’s personal representative in the Middle East. Following in Willkie’s footsteps, that spring Hurley spent two days in Palestine, ten days in Lebanon and Syria, and then flew on to Baghdad and Tehran. In early May he reported his impressions to the president from Cairo.
Hurley was an Anglophobe, but in Washington his report was taken at face value because it corroborated existing suspicions. On his travels he had heard numerous people say that British officials were encouraging the perception that the Americans were insisting on the establishment of a sovereign Jewish state in Palestine—a “line of propaganda” that, he noted, was “distinctly helpful to British prestige with the Arabs.” Another rumor he had heard was that Churchill, during a private conversation when he was last in Cairo, had said that he was in favor of a Jewish state and that Roosevelt would “accept nothing less.” Hurley’s conclusion was that the British were no longer able to settle this increasingly acrimonious issue on their own: like Hoskins, whose own report had by now reached Roosevelt, he believed that it was time for the United States to intervene.17
ROOSEVELT WAS SOON able to broach the matter face-to-face with Churchill, who arrived in the United States on May 11, 1943, for what would prove an ill-tempered conference on future strategy. A week later, when both men were having breakfast at the presidential retreat at Shangri-La, they saw that the Zionists had paid for another large advertisement in the New York Times. “Mr Churchill DROP THE MANDATE!” it demanded. This gave Roosevelt the opportunity to broach the subject. He also showed Hurley’s report to Churchill. Its comments “make me rub my eyes,” the prime minister is reported to have said.18
Roosevelt favored making a statement along the lines that Hoskins had suggested, but the prime minister had an alternative idea. Encouraged by the president of the Zionist Organization, Chaim Weizmann, who had tried to reach a deal with the Hashemites over Palestine at the end of the Great War, Churchill had long thought that Ibn Saud—to his mind “the greatest living Arab”—might be capable of reaching a grand bargain with the Zionists.19
This idea was a simplistic fantasy, but its appeal grew when, toward the end of May, the president received an unsettling letter from the Saudi king himself. The message turned out to be a bitter complaint about the effect that Zionist propaganda was having in the United States, news of which had clearly reached Riyadh. Even if this campaign succeeded in convincing the Allies to turn Palestine over to the Jews, the king said, it would not solve “the Jewish problem” because the country was not large enough. He called on Roosevelt to help stop the flow of Jewish refugees to Palestine by finding other places for them to go and to ban the sale of land in Palestine to Jews. Given Hurley’s observations, and the fact that the British knew before anybody else that Ibn Saud was writing to the president, Roosevelt must have suspected that it was they who had inspired the king to write. The news that the British were insisting that American Lend-Lease aid should continue to be channeled through the Middle East Supply Centre only reinforced the impression in Washington that they were being deliberately obstructive.20
Ibn Saud’s letter had taken a month to make its way to Washington and caused alarm when it arrived. Roosevelt replied immediately, asking the king to stay quiet before putting the gist of Churchill’s idea to him. If “the interested Arabs and Jews” could reach “a friendly understanding” over Palestine before the war’s end that would be “highly desirable,” the president suggested. He then reassured the king that “no decision altering the basic situation of Palestine should be reached without full consultation with both Arabs and Jews.”21
Roosevelt’s reply would prove to be an important assurance, but it reached Ibn Saud too late to do any immediate good. Although in April the king had promised to say nothing in public that would embarrass Roosevelt, he had since evidently changed his mind. On May 31, 1943, Life magazine ran a cover story about Ibn Saud following an interview with the king. It was a sympathetic portrait, which included a statement by him dismissing the Zionists’ claim to Palestine and, again, calling for a ban on land sales to the Jews. “If the Jews are imperilled to seek a place to live, Europe and America as well as other lands are larger and more fertile than Palestine, and more suitable to their welfare and interests,” Ibn Saud was quoted as saying.22
Hurley flew to see Ibn Saud to try to establish what had caused the king’s change of heart. He found the king particularly exercised about the fact that the British were using Lend-Lease aid to improve their own oil facilities in Iran and Iraq, while CASOC’s on the Gulf coast, denied similar investment, were largely dormant. The report rang alarm bells in Washington because it made it clear that two separate issues—the future of the American oil concession in Saudi Arabia and the Arab-Jewish conflict in Palestine—were, at least in Ibn Saud’s mind, now intertwined. On his return to Cairo, Hurley recommended to Roosevelt that, to ensure investment in the oil concession and to bypass Lend-Lease altogether, the U.S. government now create a military oil reserve in Saudi Arabia and take a direct stake in CASOC. American investment would enable the company to increase output, generating royalties for Ibn Saud, and, most important, reducing the king’s unwelcome dependence on the British.
Ickes had been thinking along similar lines to Hurley since his February lunch with Roosevelt. He now urged the president to back the creation of a state-owned Petroleum Reserves Corporation that would buy up not just CASOC’s oil but also a controlling stake in the company itself. As he told Roosevelt, his aim was to “counteract certain activities of a foreign power which presently are jeopardizing American interests in Arabian oil reserves.” Knowing precisely which power Ickes meant, Roosevelt agreed. That both men were willing to take such an extraordinary, unprecedented step shows just how great a threat they thought they faced from Britain.23
At the same time, the Americans were working to bind the British government into a public statement on Palestine that would stop British officials from claiming that the United States was pursuing a Jewish state—and so pacify Ibn Saud. On June 11, 1943, Roosevelt met Weizmann himself, telling him that, during the prime minister’s recent visit, he had “gotten Mr Churchill to agree to the idea of calling together the Jews and the Arabs”—the idea that had been Weizmann’s in the first place. Roosevelt’s protégé, Sumner Welles, was also present at this meeting. At Welles’s suggestion Roosevelt and Weizmann agreed that Harold Hoskins should be sent to Riyadh to sound out Ibn Saud.24
MORE THAN A month passed before the British answered the American request for a joint statement, mainly because neither Churchill nor Eden wanted to make one. Churchill, a Zionist since his first visit to Palestine in 1921, loathed the restrictions on immigration and land sales imposed by the 1939 White Paper and feared that any announcement about Palestine would only draw attention to his failure to abandon it. Eden, who had read Arabic and Persian at Oxford and was instinctively pro-Arab, worried that it would simply create yet another contentious document that would be parsed by each side and then used by both against the British. Although he acknowledged that they were “witnessing the first, but rapidly developing symptoms of a major nationalistic revival in the Middle East of two contending forces, Arabism and Zionism,” he held Zionist propagandists in the United States responsible for stoking the problem. In his view, it was up to Roosevelt to deal with them, starting with the pro-Zionist members of his cabinet, including Henry Stimson, secretary of war.25
It seems that it was Casey who changed both Churchill’s and Eden’s minds. On a visit from Cairo to London to seek cabinet approval of new Palestine and Middle Eastern strategies, he joined the cabinet for a discussion of Palestine on July 2. New thinking on this issue was urgent to replace the controversial policies established by the 1939 White Paper, which was due to lapse in nine months’ time. At that meeting he ran through a series of proposals that he had come up with to try to keep the peace in the country, while a new cabinet subcommittee devised a new policy for the Mandate. Again, he urged a joint statement with the Americans.
Although Churchill felt that it was “not a good time for statements on long-term policy,” Casey assured him that it was a stopgap. Eden was supportive, seeing how the statement might discourage the Revisionists from seeking to achieve violent change while the British government was groping around for a new policy on Palestine. After Churchill relented and said that he would tolerate an “anodyne Declaration,” provided that there was no further public discussion of the matter until the war had turned more in the Allies’ favor, the cabinet agreed to respond positively to the American overture. It required a further cabinet meeting on July 14 for Churchill and his colleagues to discuss Britain’s broader Middle Eastern strategy.26
“Our only chance of projecting our influence post-war is through the economic side,” Casey declared when he opened the discussion on July 14, before he explained the purpose of the Middle East Supply Centre and the Middle East Economic Council. The centre would be in a position to offer the expert guidance and material help, which were “likely to be more acceptable than political tutelage,” while the council would help integrate the Middle East into whatever “world commodity and monetary control arrangements may be adopted at the peace settlement.”27
This was an obscure but extremely important point for the governors of a country that had incurred vast debts to fight the war. To the great surprise of those who said that empire paid for itself, defending countries like Egypt was enormously expensive: by the end of that year, Britain would owe Egypt alone over a quarter of a billion pounds for goods that British forces had bought from the Egyptians but not yet paid for. By prolonging currency controls and offering guidance, the British hoped to monopolize postwar trade with countries like Egypt in order to repay what they owed. If only the British could get American buy-in to the British-dominated Middle East Supply Centre and the Middle East Economic Council, Casey continued, Britain would be able to encourage her creditors to buy British. Why the Americans might acquiesce to this, he did not say.
Casey also broached the question of oil. He wanted to seek an understanding with Washington to avoid further friction on the issue. Churchill, however, was not convinced. He had only reluctantly agreed to the review of Palestine policy, the Allies had just invaded Sicily, and to his mind the Middle Eastern war was over. “Why open up these wide questions?” he asked during the discussion. “At the peace we’ll know how much each of us counts. We don’t need U.S. help in this area, and aren’t likely to see many of them there from now on.”28
The Palestine statement was scheduled to be issued on both sides of the Atlantic on July 27, 1943, but it never went out. After the U.S. secretary of state Cordell Hull had given the green light for the announcement, he then appears to have got cold feet, perhaps because the British had in the meantime beefed up the wording to include a much clearer warning that neither government was willing to tolerate the Zionists’ use of force. Hull referred the issue to the secretary of war Henry Stimson on the grounds that it had been army officers like Hoskins who had first warned that violence in Palestine was likely. He must have known what this would mean because Stimson openly supported the Zionists, and on July 30, the New York Times reported that a statement was imminent. On August 5, Stimson rang up Hull to tell him that the situation in Palestine was less serious than was previously thought, giving Hull the excuse he needed to abandon the statement. The British ambassador reported afterward that it had been scuttled by Zionist lobbying.
Over six months’ patient work by Casey to tie the Americans in to British policy on Palestine had been for naught. And in Cairo, Harold Hoskins was about to show that Churchill’s complacent assumption that American interest in the Middle East would now die away could not have been more wrong.