William Fulbright, Former U.S Senator, Arkansas
Landon Lecture
February 13, 1975
Energy and the Middle East: Interest and Illusions
There is a profoundly important difference between our current deep involvement in the Middle East and our lingering half-involvement in the wars of southeast Asia. The difference is that American interests are at stake in the Middle East access to oil, the survival of Israel, and the avoidance of conflict with the Soviet Union making our involvement important, if not indeed inevitable. In Vietnam and Cambodia, by contrast, nothing of surpassing consequence for the United States is or ever was at stake, and for that simple but compelling reason our involvement has been, and remains, a mistake, rooted in illusions about our national interest.
The term "national interest" is an imprecise one, and it begs the question to invoke it as a guide to policy unless we have a fairly clear conception of what an "interest" is and what it is not. I would suggest the following distinctions:
A "vital interest" is anything which pertains directly to our national survival, or short of that, something materially and discernibly pertinent to the security and well-being of the American people. Most of us would agree that the avoidance of nuclear war, which is the object of detente with the Communist powers the NATO alliance and alliance with Japan, and access to oil and other essential resources belong in this category. I personally would put the development and strengthening of the United Nations in the "vital" category at the top of the list, but I am painfully aware of being in the minority on this matter.
We also have interests which are less than vital not really matters of life and death for our society, but matters of strong preference to many or most Americans, whether for reasons of idealism, humanitarianism, or ethnic or religious affiliation. I would place in this category such objectives as the development of India, democracy in Latin America, and the survival and prosperity of Israel. The distinguishing characteristic of these goals is that they are things which we want very much, and would make certain sacrifices for, but which are necessarily secondary to our vital interests.
Although there may be gradations on the way, we come at last to the category of illusions, or infatuations about the national interest, or if you like, the "arrogance of power." Here we are dealing with matters of national prestige, imperial presumption, or the vanity of leaders who do not care to admit that they have made a mistake. The distinguishing characteristics of our many national enterprises of this kind are that they usually involve great cost, great risk and no discernible benefits to the American people. Honorable mention in this category goes to the $30 billion we might have spent on energy research in the 1%'s but instead spent to put a man on the moon so as to avoid the horrible disgrace of letting the Russians get there first. Even more honorable mention goes to our gigantic defense expenditures for exotic and unnecessary weapons systems, such as the F-111 bomber, the C-5A transport, the Trident nuclear submarine, or most recently, something called the "cannon-launched guided projectile," an artillery shell whose course can be changed in mid-flight like a guided missile. Like politicians experimenting with ideas in their speeches, the military experiment with weapons systems, not because we need them for our defense but just to see if they will work. The difference of course is the cost: a politician's oratory may be superfluous but it is usually provided free of charge, or at least at moderate price: missiles and bombers may be equally superfluous, but at a cost of billions.
The gold star in this category of foreign policy illusions goes of course to the war in Indochina. It is not my purpose here to revive the old arguments about Vietnam but only to point out that there is no more justification for our continuing heavy expenditures to sustain the regimes in South Vietnam and Cambodia than there was for our own direct military involvement. Our security is not threatened; there are no essential resources involved; the cost is exorbitant. And from a humanitarian viewpoint, it is exceedingly cruel to subject the Indochinese peoples to endless civil war, perpetuated by our military assistance. Nonetheless, despite high unemployment, still rampant inflation and gigantic budget deficits here at home, the Ford Administration is asking Congress for sizable new military appropriations for Indochina, including $300 million in emergency assistance for South Vietnam, $222 million for Cambodia, and a projected $1.3 billion of military aid to South Vietnam for the fiscal year 1976. Congress, in my opinion, would be well-advised to reject these requests, for reasons of compelling national interest.
I make these observations by way of preface to my major theme for today, which is the Middle East. The point to be borne in mind is that our foreign policy cannot be based across the board on general principles of involvement or non-involvement, idealism or realpolitik. The guiding principle must be the national interest in its various gradations and components, and in the way these relate to each other. The American people do not engage their public servants to conduct foreign crusades or adventures, even idealistic adventures, but rather to advance their own security and welfare. In a report of several years ago the Senate Foreign Relations Committee noted that "Foreign policy is not an end in itself. We do not have a foreign policy because it is interesting or fun, or because it satisfies some basic human need; we conduct foreign policy for a purpose external to itself, the purpose of securing democratic values in our own country."
The Middle East
There is nothing illusory about our interest in the Middle East, but we do suffer from certain illusions about the character of our interests, and the way in which they relate to each other.
The catalyst, if not the cause, of our current, mounting difficulties was the Middle East war of October 1973. Like the assassination at Sarajevo in 1914, the October war set loose a chain reaction of events. The war precipitated the oil embargo, and the embargo, combined with Arab military successes, gave the Arabs a whole new sense of their own power and capacity. The oil-producing countries, non-Arab as well as Arab, became suddenly and belatedly aware of the power they held in their hands. United in OPEC (the Organization of Petroleum Exporting Countries), they set out to redress the imbalance between cheap oil and costly imports, and also, in a psychological sense, to redress centuries of colonialism and exploitation.
They did this through huge and precipitous increases in the price of oil. In the long run, as the finite supply of fossil fuels in the world runs down, the price of oil was bound to rise anyway. It is true too that until 1973 oil was artificially low in price owing to unbalanced terms of trade between raw materials and manufactured products. And it is also true that oil price increases are by no means the sole cause, or even the major cause, of current high inflation rates in the industrial countries. Nevertheless, the suddenness and extent of the oil price increases, more than four-fold in a single year, have had a devastating effect upon the economies of the consumer countries, especially in their international payments. In 1974 the United States had a trade deficit of $3.07 billion, the second largest deficit of this century; but if oil imports had cost the same as in 1973, we would have had a trade surplus of $14 billion. The World Bank estimates that by 1980 the oil producing countries will hold $600 billion in unused monetary reserves. If producer country imports continue at their current unexpectedly high level, the imbalance will be reduced, but not sufficiently to eliminate the threat of the collapse of the world monetary system. If that is to be prevented, a great deal more will have to be done.
First and most urgently we must take steps to save the international monetary system. That means that ways must be devised to keep the money which is flowing into the oil-producing countries flowing back as well; which is to say, it must be "recycled." That is the first requirement, regardless of what else is done, now or later, to bring down the price of oil. The most populous oil-producing countries Iran, Venezuela, Nigeria and Indonesia are already recycling most of their earnings, by spending them on foreign goods and machinery for their national development programs. Some too, especially Iran, are spending large amounts of money on foreign arms. Though unevenly distributed, money spent for foreign manufactured products enables the recipients of these funds to finance their oil imports.
The problem arises with respect to the underpopulated oil producers Saudi Arabia, Kuwait, Libya and the United Arab Emirates. With their small populations there is only so much these countries can usefully buy from abroad, with the result that huge money surpluses accumulate and are in effect put out of circulation. With no way to earn their money back, the industrial countries are threatened with international bankruptcy and domestic depression. To correct this dangerous imbalance, I would propose that urgent steps be taken, both by government and by private groups, to induce large-scale oil-country investment in the United States and other oil-importing countries. Just putting their money in our banks as demand deposits does no good, the money can be taken out at any time and is therefore unavailable for income-producing investments. Perhaps a high-level committee of private citizens who are expert in banking and investment, and who also have the confidence of the oil-exporting countries, could be formed to advise and assist these countries in channeling their funds into safe, profitable and productive long-term investments in the importing countries.
At present there is widespread fear of "Arab takeovers" of our industries if we allow them to invest heavily. Aside from the ill-grace of such complaints coming after two decades of heavy American investment in European industry, the fear of Arab investment is rooted in both prejudice and unspoken political assumptions. The prejudice is against the Arabs as people it is the old stereotype of the Arabs as not quite civilized desert riders who ought not to be trusted, like Europeans, with serious responsibilities like the management of money. The unspoken political assumption, which one detects in the atmosphere, is that extensive new economic ties with the Arab countries will undercut our commitment to Israel, all the more if these ties are in fact mutually rewarding.
For these reasons we are urged against initiatives which are clearly in the national interest. We are urged to erect obstacles to the inflow of funds which we badly need to overcome our foreign payments deficits. The prejudice against the Arabs is as ignorant as it is cruel Americans who have done business in the Arab world almost always find their counterparts cordial, knowledgeable and reliable. The connection of Arab investment with our commitment to Israel points up two facts: first, that the issues are indeed connected and must be dealt with in relation to each other; second, that when two national interests seem to conflict, the task of leadership is to reconcile them, not to pretend that the conflict does not exist, or to devise rationalizations for sacrificing the greater interest to the lesser.
In addition to "recycling" we must conserve energy. Conservation will not only lower our total oil bill; it may induce lower prices by lowering overall demand in relation to the supply. And, for reasons to which I will return, energy conservation may be a boon to the quality of life in our society.
The amount and means by which we shall have to cut back our oil imports is currently in hot debate. At present we consume 17 million barrels of oil a day, of which 7 million barrels a day are imported. The Ford Adminstration says we must reduce imports by 2 million barrels a day by the end of 1977. Others say the cutback must be much greater on our part and also on the part of other oil, importing countries, if overall demand is to be reduced sufficiently to bring about a lowering of prices. Still others contend that with discoveries of oil in the North Sea, Alaska, and off our own east coast there will soon be a glut on the world market, which will knock prices down, and that therefore the current alarm is unwarranted.
Nor is there any more consensus as to the means of cutting imports and consumption. The Administration proposes a program of tariffs combined with the decontrol of our domestic oil and natural gas prices. Some members of Congress deplore this approach as inflationary, preferring import quotas and either a stiff increase in gasoline prices or outright gasoline rationing. At the same time, with unemployment at 8.2 per cent, the highest since the end of the Great Depression in 1941, certain reputable economists are contending that we should postpone cutbacks on oil imports and consumption lest we further deepen the already deep recession.
With these observations I hope that I have clarified for you exactly what must be done to solve the energy crisis and end the recession. More likely I have merely added to your confusion, in which event you have joined company with our leaders and with the experts. The trouble with economics so appropriately termed the "dismal science" is that it is replete with propositions which, though equally plausible, are quite contradictory. I do not wish to be unduly alarmist or pessimistic, but one gets a picture these days of a government, and of experts, in confusion and conflict with one another. It would seem almost as if the Marxian prediction of breakdown resulting from the "contradictions" of capitalism were about to become a reality. Mr. Brezhnev himself said in a speech last fall that inflation and economic crisis were "speeding up the disintegration of the political machinery of capitalist rule," and that this indeed was "unavoidable" because it stemmed from the "very nature of capitalism."
My own belief is that things are bad but not that bad. I feel reasonably hopeful that through tax cuts and other means of "pump-priming" we will gradually pull out of the current recession although probably at the cost of rekindling inflation. I also believe that we should not allow either the recession or the prospect of new oil strikes to deter us from a stringent program of energy conservation. I have no great objection to the President's proposal for reducing imports through tariffs, although the same result could be achieved quickly and effectively by import quotas. Similarly, I think that the decontrol of domestic oil and natural gas prices makes long-term economic sense if we are to bring demand into balance with supply and also create incentive for new explorations and drillings.
We must also proceed with a carefully balanced but sizable national program for the development of new energy sources. This would include offshore oil drilling, with all possible care being taken to prevent pollution of the sea, and the development of improved technologies for mining coal and for its liquification and gasification at manageable cost. We must also proceed with research and development of the exotic new energy possibilities, including nuclear fusion and solar and geothermal energy. To encourage this it will be necessary, despite our desire to bring oil prices down, to keep them from coming down too much. The reason for this is that if oil prices were to drop, say, to their 1973 level, we would lose our incentive to conserve, while industry would lose its incentive to invest in the new energy sources which we are absolutely certain to need within the next decade or so. To deal with this problem Secretary Kissinger has suggested that the major oil importers agree to use tariffs or other means to maintain a "common floor price" on oil imports, considerably lower, we would hope, than the current price, but high enough to encourage the development of alternate energy sources.
Devising the best means of conservation at home requires us to go beyond immediate economic considerations and take into account the long-term necessities of our society and environment. I would suggest, therefore, that we focus our conservation measures on that most energy-wasteful, environmentally destructive, and socially obsolete feature of American life, the heavy, over-powered private automobile. Here on the broad plains of Kansas the pressures of over-crowding and urban pollution may seem remote, but they are real and pressing in the great urban centers. At the same time we have come into a period, at least for the next decade or so, of costly energy. Both of these factors combine to make the big private automobile a kind of dinosaur in modern America. In our urban areas we are going to have to rely increasingly on mass public transport. And both in and out of the cities we are going to have to trade in our gas-guzzling limousines and sports-cars for smaller, lighter vehicles which can go 25 to 30 miles or more on a gallon of gasoline. To encourage this I would recommend the following: an excise tax on new automobiles steeply graduated according to fuel efficiency; a legally imposed limit on automobile horsepower; and an increase in the federal gasoline tax of whatever amount is necessary to curb consumption substantially, with a system of rebates for individuals whose livelihoods depend upon their car or trucks or tractors.
As I suggested earlier, energy conservation could bring unexpected benefits to our society and life-style. With our current, energy-intensive life-style we Americans are not only living beyond our economic means; we are living beyond our environmental means as well, depleting not only the world's fossil fuels but also many other renewable raw materials. We are also consuming renewable resources such as fish faster than the earth's natural processes can replace them, and fouling the rivers and oceans beyond their natural capacity for cleansing themselves.
We have fallen into what may be called a "technological illusion" about the good life. The more machines and gadgets we possess, and the more energy we therefore consume, the better we think our lives are as if living affluently were the same as living well. In fact they are not the same. Living well requires a certain harmony with nature, a sense of pace about time, the taking of pleasure in simple things the view of a mountain or the sea, a fine day, the company of family and friends.
The average American today consumes twice the energy he consumed thirty years ago, twice as much as is now consumed by a European, and perhaps 50 times as much energy as a Chinese. Do you suppose for a moment that the average American is now twice as happy as he used to be, or twice as happy as the average German or Frenchman, or fifty times as happy as a Chinese farmer? There is certainly no visible relationship between our greatly increased energy consumption of recent years and, say, the quality of our architecture, or of our literature, or of urban life in general. The thought arises that such improvements in our civilization might be encouraged by diminished energy consumption. The philosopher and microbiologist Rene Dubos suggests that intensive use of industrial energy frees us of the necessity to make creative and adaptive responses to environmental challenges. It "makes for an easier life," he writes, "but it impoverishes our experience." It may be, therefore, that the end, or interruption, of the age of cheap energy may give us incentive to redirect our creative powers from growth and gadgetry to a renewed concern with the quality of life and culture and the environment, freeing us from the illusion that technology is progress.
The Arab-Israel Conflict
There is another whole aspect to the energy crisis, and that is its close relationship to the Arab-Israel conflict. Our efforts to deal with both have been blunted, in large part indeed thwarted, by the illusion, or pretense, that they have nothing to do with each other. In fact, as I suggested earlier, they have a great deal to do with each other, not only because the oil price revolution was precipitated by the war of October 1973, but because the principal Arab oil producers, notably Saudi Arabia, perceive and act upon two issues, oil and Israel in relation to each other.
As I also suggested earlier, I believe that access to oil is the greater of our interests in the Middle East, a vital interest, whereas our commitment to Israel is a less-than-vital interest. I believe too that the all-out supporters of current Israeli policy in Congress and elsewhere are well aware of this priority of interests, and precisely because they do recognize it, contend that the two issues are unrelated. Only by denying the connection can support of Israeli policy be given precedence over our national energy requirements. The issue is further obfuscated by the invocation of "idealism" on Israel's behalf. To this I would suggest that there are other ideals involved besides Israel's democracy and vitality impressive though these are including the ideal of self-determination for the Palestinian people. But even more I would stress again that our Government is not an eleemosynary institution: its first obligation is to the security and welfare of the American people, not perhaps to the extent of exclusiveness but certainly to the extent of primacy.
In practice I do not believe it is necessary to sacrifice oil to Israel, or Israel to oil. Indeed, I believe it to be perfectly feasible to achieve both an equitable settlement which will assure the survival and security of Israel and also solidify our good political and economic relations with the Arab countries. In order to do this, however, it is necessary to appreciate the convergence of the two issues, oil and Israel, and also to appreciate the central importance of Saudi Arabia in this linkage:
Within OPEC the countries most insistent on repeated price increases have not been the Arab states, but two of the principal non-Arab producers, Iran and Venezuela. The largest oil exporter with the largest reserves, Saudi Arabia, has shown a keen awareness of the dangerous disruptions threatened by the four-to-five-fold increase in the price of oil, and Saudi officials have made known, both publicly and privately in unmistakable terms, their strong desire to lower prices and to work out long-term supply arrangements for the industrial nations, especially the United States. The Saudis are motivated by strong feelings of friendship and also of reliance upon the United States. Greatly fearing communism and Soviet and Chinese influence in the Arabian peninsula, Saudi Arabia looks to the United States as its mainstay against communism in the Middle East.
But the Saudis are caught in a dilemma. It is exceedingly difficult, if not impossible, for them to accommodate the United States while the United States provides the money and arms which enable Israel to occupy Arab lands. Further, and this is the heart of the matter, King Faisal feels a special responsibility, indeed a stewardship, for the holy places of Islam. Second only to Mecca in sanctity to Muslims is Jerusalem, where the Dome of the Rock is located, scarcely a hundred yards from the Wailing Wall, which is Judaism's holiest site, and within a half-mile of the Christian shrine, the Church of the Holy Sepulchre.
As a city sacred to three religions, Jerusalem warrants a special status. Exactly what the status is is less important than that it be acceptable to all parties. It might be feasible to re-partition the city between the "old" Arab sector and the "new" Israeli city as before 1967, but providing for free access to all the religious shrines, and perhaps redrawing the boundary to include the Wailing Wall within the Jewish sector. Or, as has often been suggested, Jerusalem could be internationalized in accordance with the original United Nations partition plan of 1947.
Equally as important as Jerusalem for a just and durable settlement is the provision for self-determination by the Palestinian people. Forcibly expelled from their homes and country, and subjected for over a quarter-century to the harsh privation of refugee camps, the Palestinian people are deserving of restitution just as the Jewish people were deserving of restitution after World War II. They have as much right to a homeland as do the Jewish people, and they have shown, moreover, that they can and will persist in their guerrilla warfare until they get one. Accordingly, a reasonable settlement must allow of a Palestinian state being established in the territories now occupied by Israel on the West Bank of the Jordan River and the Gaza strip. Alternately, the Palestinians might form a confederation with the Kingdom of Jordan, but the choice must be theirs and, by all current indications, that would not be their choice.
Far from "selling out" Israel, a settlement based on Israeli withdrawal to the approximate borders of 1967, along with explicit great power guarantees, would call upon Israel to do nothing more than she ought to do anyway, even if there were not a drop of oil in the Middle East. Indeed it would be to Israel's advantage-probably her salvation because there can be no lasting security for that small, beleaguered community without a settlement, and there can be no settlement without withdrawal. For the United States the occasion, if we rise to it, is one of those rare and happy ones in which justice and self-interest coincide.
Five years ago, in a remarkable but little-noted article, the President of the World Jewish Congress, Dr. Nahum Coldmann, raised the question of whether an Israel armed to the teeth and repeatedly at war could fulfill the Zionist ideal of a homeland for Jewish culture and religion. Noting too that the long-term balance of power would inevitably swing to the Arabs with their vastly greater numbers, their oil wealth, and their growing technological capacity, Dr. Goldmann concluded that Israel should seek to become a neutralized state, somewhat like Switzerland, guaranteed by the nations of the world, including the Arab nations. "I was always a political Zionist," Dr. Goldmann wrote at that time, "in the sense that I believed that Jews must have a state of their own to secure their identity and civilization. More and more, however, I am coming to the conclusion that Israel cannot be one of the more than a hundred so-called sovereign national states as they exist today and that, instead of relying primarily and exclusively on its military and political strength, it should be not merely accepted but guaranteed, de jure and de facto, by all the peoples of the world, including the Arabs, and put under the permanent protection of the whole of mankind."
Is such an arrangement remotely feasible from the Arab point of view? "Whoever knows the Arabs," Dr. Coldmann also wrote, "their history and character, agrees that pride is one of their most excessive virtues. But an appeal to the generosity of the Arabs, to be guarantors with the rest of the world for a Jewish state in a tiny part of the tremendous territories at their disposal, however unrealistic it may sound at the moment may be more effective in the long run for an Arab-Israeli co-existence than one Israeli victory after another.
How, as a practical matter, should American and other statesmen proceed toward the achievement of so desirable an arrangement? I would suggest two essential changes of approach: we must accept the Russians as full partners in the making and guarantee of a Middle East peace; and the Israelis must accept the Palestinians, represented by the Palestinian Liberation Organization, as negotiating partners with a right to form a state of their own.
Although Secretary Kissinger has made admirable progress with his disengagement agreements, and may on his current trip secure another Sinai disengagement, there are limits to the progress that can be made through the current "step-by-step" approach. Welcome and impressive as the withdrawals in Sinai and the Golan Heights have been, they do not deal with the central, crucial issues of Jerusalem and the West Bank. As the noted Egyptian journalist Mohammed Heykal notes, this is a policy of "pacification" rather than of "seeking a solution," and it is insufficient because "You cannot pacify forever."
Nor can the Soviets be expected to acquiesce in a process, or a settlement, from which they have been excluded. If and when peace is finally made, the guarantee of the Soviet Union will be hardly less important than our own. One hopes that American diplomats will not succumb once again to what Mr. Heykal calls their "hunter's instinct," the old geopolitical impulse to "expel" Soviet influence from the Middle East while detaching Egypt from the other Arab countries.
We should, therefore, proceed as quickly as possible after Mr. Kissinger's current mission to convene the Geneva conference under the co-chairmanship of the Soviet Union and the United States, and to negotiate through that forum a general settlement based on Israeli withdrawal to the 1967 borders, self-determination for the Palestinian people, and a special status for Jerusalem, all under the guarantee of the great powers as members of the Security Council of the United Nations. I would also hope that consideration might be given to Dr. Nahum Coldmann's proposal for a neutralized Israel. And as I have suggested on numerous occasions for the last five years, I would think it appropriate for the United States to re-enforce the general guarantee of Israel with an explicit, bilateral American guarantee through a treaty ratified by the Senate.
Through these means we can, I believe, reconcile our three major interests in the Middle East access to oil, the security of Israel, and the avoidance of confrontation with the Soviet Union. An Arab-Israel settlement will not solve our energy crisis or assure the reduction of oil prices. It would, however, eliminate the major irritant in relations between the United States and the Arab states, especially Saudi Arabia, and in so doing create a much improved environment for negotiations on oil supply and prices. A settlement making just provision for the old city of Jerusalem and for the other occupied territories would greatly increase the political influence of Saudi Arabia, and therefore its weight as a force for moderation within OPEC. Saudi Arabia would be liberated, in effect, to do what King Faisal and his ministers want very much to do: cooperate to keep the West, and especially the United States on which Saudi Arabia relies, prosperous and strong.
There is not now, nor has there ever been any basic incompatibility among our interests in the Middle East. Our difficulty in reconciling them has been the result of our own illusions about the priority of those interests in relation to each other. These illusions of course are not entirely accidental; they have been fostered and promoted by ardent and skillful lobbying. Of late, I note with satisfaction, some serious reassessment seems to have been taking place. The new Chairman of the Senate Foreign Relations Committee, Senator Sparkman, recently expressed his support for a Palestinian state and for a settlement guaranteed by the Soviet Union and the United States in cooperation with the United Nations Security Council. Similarly, Senator Percy of Illinois, a sincere friend of Israel, gained a new impression of the Palestinians in the course of a recent visit to the Middle East, stating upon his return that the PLO leader, Mr. Arafat, is "relatively speaking, a moderate." Senator Percy also advocated Israel's withdrawal to the approximate borders of 1967 and suggested, most sensibly, that "we cannot support Israel indiscriminately."
Interests, it appears, are being recognized, and illusions dispelled slowly and belatedly to be sure, but that is the way of statecraft. "Common sense," as Voltaire noted, "is not so common." By contrast with our prodigies of technology, we do not seem to advance very quickly when it comes to the running of nations, the reconciling of interests, or the sensible conduct in general of human affairs. But we do sometimes manage it, and in that we can take hope. As Dr. Johnson said of the dog walking on his hind legs, "It is not done well; but you are surprised to find it done at all."