[DISCLAIMER: The letters in this post were written at a time when all organizations that actively settled the land of Israel were not religious. Keep in mind that today there are many organizations that work towards the settlement of the land while keeping the Torah Kala KaChamurah]
In a post on Hirurim, in the comments section, It was reported that Rav Kook Zt"l was called a Rasha Gamur C"V for supporting the Keren HaYesod (an organization at the time that raised money for the settlement of Jews in the land of Israel). Here is an exchange of letter between several Chasidishe Rabbanim in Europe and Rav Kook on this exact matter (from An Angel Among Men, pg 495-499):
With G-d's help Mar-Cheshvan, 5686, Warsaw
To our dear friend, the famous gaon, outstanding scholar etc., our glorious teacher and master, R. Avraham Yitzchak HaKohen Kook shlita, Chief Rabbi of the Holy City of Jerusalem, may it be rebuilt and established speedily in our days, Amen.
We heard that Your Brilliant Honor has denounced the fact that we do not encourage [our followers] to support Keren Kayemet LeYisrael and Keren HaYesod, and that we actually warn them not to contribute to these funds. We hereby wish to inform Your Honor of our opinion [on the matter]. We believe that we have an obligation to settle Jews in our Holy Land on the foundation of our holy Torah and religion. Now, the vast majority of people who donate to these funds, even the freethinkers, want the sacred Yishuv in the Holy Land to rest on the foundation of our holy Torah and the restoration of our religion. Thus, since the money collected by these funds helps support sinners and public desecrators of our religion (as is well known), and since G-d fearing Jews do not head these organizations to make sure that the assistance goes only to the families of observant Jews - craftsmen and laborers who follow the Torah - we cannot support those who desecrate all that is holy to the Children of Israel. Besides which, this is considered stealing from the public [because the money does not reach the intended recipients].
Therefore, we ask Your Honor, as well, to stand in the breach and help repair this vital fence. We ask you to arouse [the heads of these funds] to [accept] our words - uttered in truth from the depths of our heart - and [convince them] to assist only religious, Torah-observant settlers of our Holy Land, in order to increase the glory of Heaven and the glory of Israel. We are sure that, with God's help, the merit of the Torah and its commandments will stand by us, the children will return to their borders, and we will be privileged to see the Temple in its rebuilt state and our Holy City of Jerusalem in its beauty, speedily in our days. Amen.
Rav Avraham Mordechai Alter (Gerrer Rebbe)
Rav Meir Yechiel HaLevi of Ostrovtza
Rav Mordechai Yesef Elazar Leiner
Alter Yisrael Shimon of Minsk
Rav Kook's response was as follows:
With G-d's help The Holy City of Jerusalem, 21 Kislev, 5686
To my beloved friends, the brilliant and pious rabbis, heads of the thousands of Israel, our holy teachers and masters, R. Avraham Mordechai Alter, R. Meir Yechiel HaLevi, R. Yosef Elazar, and R. Alter Yisrael Shimon, shlita,
I received your holy letter in proper [time], and I wish to tell Your Holy and Brilliant Honors (shlita) sincerely that I would never, G-d forbid, denounce the holy traits of the great Torah leaders of our time, the likes of whom I hope will increase in Israel. As for me, I believe that it is a great mitzvah for every Jew to donate to Keren HaKayemet, because redeeming portions of the Holy Land from Gentiles and bringing them under Jewish ownership is undoubtedly a great mitzvah, one that all Jews must support with all their strength. And if more such funds arise, it is a mitzvah to help them all, because - due to our numerous sins - most of our holy soil is in the hands of strangers, and our eyes languish all day long for every cubit and handbreadth that is held captive in the hands of foreigners. Obviously, when it comes time to settle [Jews in the Land], we must strive with all our might to ensure that everything is done according to the ways of Hashem, in keeping with the Torah and its commandments. But as long as we are engaged in transferring the land from foreign hands to Jewish ones, we are obligated to help.
However, regarding Your Brilliant and Holy Honors' request that I, too, issue a statement inspiring others to help only those who follow the Torah and our religion: allow me to explain briefly to Your Exalted Honors why this is a very difficult matter. Firstly, according to the laws of our holy Torah, some of the people who fail to observe the Torah and our religion (due to our numerous sins) are, nonetheless, far from the category of those whom we have no obligation to sustain. They dwell in Eretz Yisrael and work hard to cultivate the soil of Israel and prepare it for settlement. If we withhold their support, they are likely to die of starvation, G-d forbid. How, then, can I say that these people should be denied support?
Secondly, [even if I were to fulfill your request], one would listen. [Our Rabbis'] statement "Even if a Jew sins, he is still a Jew" is so familiar to the masses who donate [to this cause] that they would completely ignore our request to distinguish between one recipient and another, especially when [the pioneers] are engaged in settling the Land, upon which all Jewish eyes focus.
Furthermore, I constantly try to befriend those who are estranged from Judaism, those whom the exile has caused to stray from the path of G-d (due to our numerous sins). Through cords of love and brotherhood, many people come closer to holiness, or at least do not become more rebellious. If I become their enemy now, depriving them of their sustenance, they, too, will become my enemy and drift even further away, G-d forbid. How can we possibly cause so many Jews to stumble with our own hands?
Besides this, we clearly see that the expansion of Jewish settlement in Eretz Yisrael - even though some places are inhabited by people who are far from perfect in our holy Torah - has caused, and continues to cause, religious, G-d fearing Jews to come and settle in the Land, where they keep the Land-related mitzvot in holiness and purity. Moreover, [before the pioneers came] many places were dangerous to traverse because of snakes and scorpions, and because of thieves and highway robbers hid out in desolate locations, waiting to attack passersby. It was also dangerous to dwell in certain places because of the poisonous swamps that developed in the Holy Land during its years of desolation. All of this kept Jews away. But now, thanks to the great work of the pioneers, the snakes and scorpions have been eliminated, the malaria-infested swamps have been turned into healthy, inhabitable areas, the highway robbers no longer have a place [to roam], and whoever travels through Eretz Yisrael does so in safety, thank G-d. Thus, the efforts of these inferior people have greatly benefited proper, Torah-observant Jews, allowing them to settle in the Land of Israel. How, then, can we arise and oppress those who have caused, and continue to cause, so much good for the entire Yishuv, when they are building the foundations upon which the settlement of proper, G-d fearing Jews rests?
Therefore, I tend to think that we are not permitted to discourage any Jew from engaging in the great mitzvah of settling and building the Land Of Israel. Rather, we must do much more to encourage faithful Jews to come quickly to the Holy Land with their wealth and possessions, to settle and build the Land. At the same time, we must treat the other settlers in a pleasant manner and guide them with words of peace, so that they may come closer to Torah and fear of G-d. This will truly increase the glory of Heaven and the glory of Israel, as Your Holy Honors (shlita) desire with all your pure hearts and souls.
I sign with a blessing, anticipating imminent redemption and salvation, in accordance with your exalted desire and the intense desire of your friend [myself]. Best wishes to Your Holy Torah Personages from the holy mountain of Jerusalem,
Avraham Yitzchak HaKohen Kook
