(The meeting was opened by President Wesley R. Johnson, who presented William P. Vititoe, Chairman of the Board, The Economic Club of Detroit, and President and Chief Executive Officer, Michigan Bell Telephone Company.)

WILLIAM P. VITITOE: Wes, thank you very much.

When Dr. Kissinger left his post as the United States 56th Secretary of State on January 20, 1977, the New York Times wrote: "Henry Kissinger has not been President of the United States for the past eight years; it only seemed that way." (Laughter)

The accolades for Dr. Kissinger have been many. In public service and through the private sector his international legacy is impressive. Currently he is Chairman of Kissinger Associates, Inc., an international consulting firm.

More familiar, however, are his historic efforts toward the achievement of lasting peace. The Dictionary of American Diplomatic History distinguishes Dr. Kissinger as one of the most influential Secretaries of State in the 20th century.

He is the 1973 Nobel Peace Prize winner, the recipient of our nation's highest civilian award, the Presidential Medal of Freedom, as well as the Medal of Liberty.

Dr. Kissinger originated the concept of shuttle diplomacy, and he first enunciated the doctrine of flexible response, arguing that American survival and victory depended not only on our strength but also on our ability to recognize and fight aggression in all its forms.

His philosophy has often earned him the distinction of being hated by both ends of the political spectrum. And, as American Jewish Biography pointed out, it was often Kissinger

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and not Presidents Nixon or Ford of whom many foreign leaders sought advice and to whom, on occasion, assigned the blame for policy failures.

The history books are already emphasizing Kissinger's role in negotiating the Middle East Peace Treaty. He will continue to be credited with ultimately ending the war in Vietnam, to instituting detente with the Soviet Union, for bringing peace to war-torn Chile, and for establishing relations with Mainland China.

And in the present and foreseeable future, he is recognized as THE consultant on global strategy economic analysis.

With an international client list that commands confidentiality, Dr. Kissinger offers sage advice on geofinancial international affairs. It is said that businesses of myriad industries -- finance, automotive, high technology, food and dry goods -- seek his expertise.

And while there are popular rumors as to who some of his clients are, each contract is co-signed with the corporate client containing a clause pledging mutual confidentiality. Neither party is supposed to even acknowledge it has any ties to the other.

Business Week has highlighted his reputation as "adviser to the mighty" and called it staggering. In doing so, the writer underscored his impact as follows: "Kissinger sometimes appears to have no source of power other than the aura of power. It is an aura many will pay dearly to bask in, hoping to grow powerful as well. The power sought is global leadership, regardless of the industry."

-3-

As Kissinger himself was quoted in a New York Times maga-
zine interview: "In the modern world if you don't understand
the relationship between economics and politics, you cannot
be a great statesman. You cannot do it with foreign policy
and security knowledge alone."

I would argue today the same holds true for American
business. The strategy of a great business recognizes the
linkages and builds global opportunities.

Today Dr. Kissinger will offer a geopolitical outlook for
the 90's. Please join me in welcoming Dr. Henry A. Kissing-
er.

(Applause)

DR. HENRY A. KISSINGER: Mr. Chairman, ladies and gentle-
men. This introduction leaves me in the position in which I
once was at a reception where a lady came up to me and said,
"I understand you're a fascinating man. Fascinate me!"
(Laughter) It turned into one of the less successful conver-
sations that I have had.

I also want to point out one accomplishment which your
chairman did not mention. There was a period in which I was
both Secretary of State and Security Advisor. And I can say
without any fear of contradiction that never have relations
between the White House and the State Department been as
close as they were in that period.

Now I must tell you, I am very impressed by the title
that has been given to my speech and I know I have a very
eager assistant who has a great sense of the dramatic.

What I am going to talk about is the current internation-

-5-

bility, no matter what else is wrong with it. And our
economy is tied to that of the rest of the world. So now we
have to conduct a continuing foreign policy. And that means,
when you have exercised foreign policy responsibility, as I
have, and some of your other speakers here have -- there is
one overwhelming reality: Whenever you have settled some-
thing, or you think you have settled something, you know deep
down that this is just the beginning of another set of prob-
lems. And very often when the newspapers were most kind to
me about some diplomatic achievement, I was really not all
that elated because I knew it was an admission ticket for a
whole new set of problems, and that is our destiny now as a
nation and we have to get used to that.

So when we talk about peace, we have to remember that there
will never be a point at which we can say that we live in
total tranquility and in total harmony with the rest of the
world. Every President has an opportunity to improve the
situation, but not to bring an end to it.

This Administration has peculiarly fortunate circum-
stances. The previous Administration reversed the decline in
the perception of America in the world and it built up our
capability. At the same time, the Soviet Union got into
massive difficulties.

And so I want to talk about some of the opportunities
ahead of us. Now, one of the things, however, that we have
to guard against is the idea that one Soviet leader is the
key to our salvation. All over the world, including in this
country, there is tremendous fascination with the personality

-6-

Mikhail
of Gorbachev. He's got so many titles now -- President,
lately, of the Soviet Union; General Secretary of the
Communist Party of the Soviet Union. I've met him five or
six times, the last time two weeks ago. And there's no doubt
that he is one of the more interesting Soviet leaders; now
[that is damning with faint praise.]

Gorbachev
He is interesting, not only compared to other Soviet
leaders, he is the first Soviet leader who went to a univer-
sity. He is educated and intelligent and charming. All of
this is true. But there is a tendency in America to look at
foreign policy based on our national experience. And in
America, human relations are extraordinarily gentle and kind.
Many Americans tend to think of the Soviet leaders as if they
were misunderstood Americans. And time and again I have
heard it said, "If only Gorbachev -- or, before him, Khrush-
chev -- could be shown an American farm or an American swim-
ming pool, all our problems would disappear."

I have a friend who is of the view that there is no such
ting as an English accent. He thinks that the English put
this on to intimidate Americans. (Laughter) And that if you
can catch an Englishman unaware, like waking him up at 4:00
in the morning, he will talk like any other normal human
being. Now this view is held by many Americans about Soviet
leaders. And I would point out that the experiences of Sov-
iet leaders are quite different from ours.

First of all, if you want job security you do not enter
the competition for leadership in the Communist Party of the
Soviet Union. If you lose in that competition, you do not

-7-

get transferred to another job; you become a non-person. No
Soviet leader has ever retired with honor. In fact, no Sov-
iet leader has ever retired, except one. They have all died
in office because it's too dangerous to retire.

There is a species of spider that has always fascinated
me, in which the female eats the male after the act of pro-
creation. And I've always wondered what induces the male to
engage in such a dangerous enterprise. (Laughter) And why
that species continues.

Now in the Soviet Union, when a leader dies the Polit-
buro, equivalent to the Board of Directors, elects among its
members a successor, who then, once anointed, purges all the
members of the Politburo. This is what Gorbachev has done.
There is only one man left on the Politburo who voted for him
when he came into office. I mention all of this simply to
point out that we must not delude ourselves. If you become
the head of the Communist Party of the Soviet Union, you are
not a choir boy. This is not a career for the softhearted.
It is a career for people with a tremendous sense for power.

And, therefore, to rely entirely on one personality is
extremely dangerous. On the other hand, there are a number
of reasons why any Soviet leader -- Gorbachev or anybody else
-- should want to have an easing of international tensions.

First, the Soviet economy is a mess. Any of you who
have visited the Soviet Union would be able to testify to
that. Here is a superpower that has huge resources,
comparable to those of the United States, that used to export
food all over the world, that now has to import large quan-

-8-

[Y]

tities of food; in which there are no consumer goods; in which there are food shortages all over the country. And the reason is that if you try to run an economy by central planning you create total stagnation.

In the Soviet system, a manager is not an entrepreneur, he is a politician. His skill consists of negotiating with the planning mechanisms and the ministries about a quota for his output, which is deliberately put at a level that he should be able to meet because it will bring down everybody if they set too ambitious quotas. There is no incentive whatever for quality improvement because there are no markets. Nobody knows the cost of anything. Prices of about 40 percent of all products in the Soviet Union are subsidized. Subway fares in Moscow, or a pound of potatoes, cost exactly the same this year as they did in 1928. So you know it is obvious that nobody has the foggiest idea as to the real cost of anything. And it was said jokingly in the Soviet Union that the Soviet social contract consists of the fact that managers pretend to pay workers and workers pretend to work. And anybody who has dealt with the Soviet Union will be able to confirm the low productivity of Soviet workers and I cannot understand what possesses American companies to keep rushing for joint ventures into the Soviet Union until the economic system has substantially changed.

So the economic system is a mess. An they will have to decentralize it, And they will have to create incentives, And they will have to create markets in order to know, to get some grip on productivity and costs.

-9-

On the other hand, how do you do that with a managerial
group that has never managed in the Western sense? And how
do you do it with a leadership group that has a vested
interest in the status quo? What does the Communist Party do
when you do away with central planning? They have this
paradox: You cannot run a modern economy by central planning
but you may not be able to run a Communist state without
central planning. That's the most fundamental problem that
Gorbachev has and he is now trying to deal with it by revo-
lutionary methods.

He has appointed himself - or the government has appoin-
ted him -- as President of the Soviet Union. The President
of the Soviet Union never amounted to anything. His primary
job is to go to the airport and greet visiting heads of
state. When Gromyko was President, I asked him what his job
consisted of. He said, "Well, I settle disputes between re-
publics." This was in the old days before one knew there were
any disputes.

So I said, "Okay, give me an example of a dispute be-
tween republics."

Well, he couldn't give me one example, though. And he had all
kinds of time. I had an appointment with him and he kept me
for three hours. He would have kept me longer, he was so
glad that somebody came in to see him. (Laughter)

That is no longer the case. Gorbachev has taken over
the presidency and he's moving functions that used to be in
the Communist Party apparatus and in the military into the
office of the presidency. So then the question is, is he

-11-

security; that the military situation remains more or less
what it was before. And that's correct. They do away with a
categories of arms
few causes of warrant, but they do not solve the fundamental
problems.

Now I think, however, we are in a situation where the
Soviet Union for its own reasons -- not because Gorbachev is
a pleasant fellow or
because his wife wears designer dresses; but
because there are objective reasons -- must want a relaxation
of tensions. One is the economic problem. If the Soviet Union
continues another 20 years the way it's been going, it will
become the most developed of the underdeveloped countries.
Even now if you look at the Soviet
economy, of the Soviet Union, it
acts like an underdeveloped country. It exports commodities.
It does not produce one manufactured article for export. This
superpower cannot compete with Singapore in the export of
manufactured products. That's an untenable situation.

Secondly, the international environment has changed in
at least two ways. One, Communist ideology is dead, except
perhaps in a few isolated countries of Latin America. But in
Eastern Europe, in many parts of the Soviet Union, in Western
Europe, as a general proposition everybody knows that Marxism-
Leninism is not a key to the economic future. The Communist
parties of Italy and France that everybody used to be terri-
fied of, and justifiably as late as the late 70's, are in con-
stant decline. In France, they've gone from 25 percent to
about 8 percent. In Italy, they've gone from 35 percent to
25 percent, and everybody agrees that they'll be lower at the
next election. So they have lost the troops on whom they

-12-

could count in many of these countries.

Secondly, all the surrounding countries are growing faster than the Soviet Union. China, Western Europe, Japan, even India. So if present trends continue, the Soviet Union will be contained -- which has been one of the major objectives of Western policy. The only hope that the Soviet Union has to continue its previous policies is to demoralize primarily Western Europe. They cannot do it in Asia because the Chinese and the Japanese are tough in assessing their national interests. You cannot impress the Chinese or the Japanese by a change of tone.

A few weeks ago I was in Moscow with former Prime Minister Nakasone. After the most eloquent statements from the Soviets about their desire for peace, he would usually say, "Yes, but what are you going to do about the four islands which you took from us at the end of the war? And until we get those four islands back, we're not all that interested."

But in Western Europe there is a possibility that the Soviets can create the impression that simply by a change of tone all our problems are solved. And many of the Soviet policies can be interpreted as an attempt to reduce the American influence in Western Europe, to break the ties of the NATO alliance, and to turn Western Europe into a kind of economic arsenal for the Soviet Union, while reducing its military potential.

That is what the Soviets may want to do. But if the West keeps its head, it cannot do it because there is one

-13-

[Y]

other factor that is of great consequence. That is, by any analysis, the unity of Eastern Europe (and the cohesion of Eastern Europe is dissolving faster than anything the Soviets ought to be able to do to Western Europe.

Today the leaders of Solidarity in Poland are meeting with the so-called Communist Government, which in turn has a military government rather than a Communist Government. If you consider that the Communist Parties regard themselves as the representatives of the working classes, for them to sit down with a labor union and negotiate with it as an equal is already an unbelievable change in the situation.

In Hungary they're introducing a multiparty system, so that the real discussion that ought to take place now is not over who has what weapons where, which is technical and which is so complicated that you can say about it what was to be said about a 19th century diplomatic problem about which the British Foreign Secretary, Lord Palmiston, remarked: "Only three people have ever understood this. One is dead, the second is in a lunatic asylum, I'm the third, and I've forgotten it."

(Laughter)

So these arms control negotiations can go on and they will do some good. But the fundamental problem now is to see what happens to Europe, whether it is possible to bring Europe back to its more traditional pattern. Now the Soviets have said, there should be a Europe from the Urals to the Atlantic -- an absolute absurdity. Two-thirds of the Soviet Union is beyond the Urals and that nicely excludes the United States

-14-

and includes the Soviet Union. The historic Europe begins at the Soviet-Polish frontier, and it should include the countries of Eastern Europe, and the negotiations should concern how one can give the Soviets reasonable security guarantees and give the people of Eastern Europe freedom. That is now a possibility. And that is now a challenge before our foreign policy. And I believe progress toward it can be made during the Bush Administration -- which is one historic opportunity.

The second is to get back to my original point, Americans have to understand that we are not living in a world in which one can say that there is a clearcut terminal point. In the 1930s Winston Churchill wrote the following about British foreign policy. I'll summarize it:

"For 400 years the foreign policy of England has been to oppose the strongest, most aggressive, most dominating power on the Continent. It would have been easy and must have been tempting to join with the stronger and share the fruits of the conquered. However, we always took the other course, joined with the less strong, made an accommodation among them, and frustrated the tryant whoever he was, whatever nation he led. The question is not whether it is Spain or the French monarchy or the French empire or the German empire or the Hitler regime or Philip II of Spain or Hitler of Germany. It has nothing to do with rulers or nations. It is concerned solely with maintaining a balance against a potential tyrant. It is in this manner that we preserve the liberties of Europe."

-15-

Now in a strict sense this is the mission of the United
States today. We cannot be the principal at the front line
of every confrontation that takes place in the world. But
what we can do is to prevent one nation from attempting to
achieve world domination. Therefore, we have to have some
understanding of where the threats come from and what con-
structive relationships can be built.

We will see now in Afghanistan, in Angola, in Cambodia,
in the conflicts that are being settled whole new sets of
problems emerging. And after the Soviets have left
Afghanistan, what is the American interest in Afghanistan
other than the withdrawal of Soviet troops? In Cambodia, if
we don't want the murderous Pol Pot regime to come back, what
can be done by others, and to some limited sense by us, to
create a combination to prevent the return of people who
killed two million of their own population in a period of
three years.

Those are some of the practical problems that are before
us. But even in a deeper sense, in a more fundamental sense,
we will see the emergence of a united Europe, at least in the
economic field. Japan is already a major competitor. China
will grow. What is our idea of an international economic and
political system in which these units can cooperate and do
not engage in conflicts? My own personal view is that we
have to create in the Western Hemisphere -- as we have
already done with Canada, maybe including Mexico -- some
trading bloc with which we can negotiate on the basis of
greater equality both with the East Asian bloc and with Euro-

-16-

peans.

But whatever it is, we need some concept of the future
before we can build that future. With respect to the Soviet
Union, the overwhelming problem is whether it can be so
the first time in 400 years, live in equilibrium with its
neighbors? Russia for that period has been expanding from
being a small duchy around Moscow to the center of Europe at
the Elbe and to the Pacific at Vladivostok. They have never
lived in equilibrium with their neighbors. And to ask them
to live in equilibrium, in a country of 11 time zones, in
which Vladivostok is closer to Seattle than it is to Lenin-
grad, and Leningrad is closer to New York than it is to
Vladivostok, would suggest that they should not suffer from
claustrophobia if they stay within their own territory.

That is our challenge. I actually also believe that
it's our opportunity. I have a Chinese acquaintance who
claims that there exists the following Chinese proverb. I
say "claims" because there cannot be as many Chinese proverbs
as they say there are. But that proverb allegedly goes like
this: "When there is turmoil under the heavens, little prob-
lems are dealt with as if they were big problems. And big
problems are not dealt with at all. When there is order
under the heavens, big problems are reduced to little prob-
lems, and little problems should not upset us."

We actually have a great opportunity now not to produce
a static condition in which there is no longer any tension,
but we do have an opportunity to reduce big problems to
little problems and thereby contribute to what the Chinese

-17-

say is order under the heavens.

Thank you very much, and I'll be glad to answer any
questions.

(Applause)

QUESTION: "What do you see as the major challenge for the Bush Administration in the first two years?"

ANSWER: Well, I talked about the foreign policy area. We have, first of all, the challenge that I mentioned before: It is to induce the Soviets to get off the technical issue of arms control alone and to talk about the political future of the world, or certainly the political future of Europe. Because that will determine the long-term possibility of preventing some sudden explosion that we cannot control.

Secondly, we have to deal with the relationships of the industrial democracies among each other. We cannot continue unrestrained economic competition, without some idea of the obligations of each of the participants to have some view of what the developing world -- some of which I've described -- is going to mean for the economies and the political relationships when the United States is no longer as dominant as it was in the 1940s. And these other countries are so much stronger that they can assume greater responsibilities.

And third, we have a special relationship in the Western Hemisphere, which has two parts: One, the problem of Central America. And, secondly, the problem of the major Latin American democracies. With respect to the major Latin American democracies, if they should become anti-markets,

-18-

radically anti-U.S., then most of the attention of the United
States would be focused on the Rio Grande rather than on
where we have had to focus it in the last 40 years. And all
of these countries have new governments, major economic
crises and a big international debt problem, which has made
them exporters of capital as underdeveloped nations; which,
in turn, has meant a $40 billion shift in our trade balance
with Latin America alone. So that in a way our manufacturers
have paid banks for the debts. I think this debt issue has
to be resolved within the next two years before the situa-
tions in Latin America disintegrate completely.

In Central America we have to make up our mind what we
want. There is no painless way of prevailing against guer-
rilas. There is the temptation that you can, on the one hand,
have diplomacy and, on the other hand, absence of pressure --
that will not work. And I think the Administration has to
decide
make up its mind whether Central America is so unimportant
that we don't risk much if it goes Communist; and if it
doesn't want that, it has to develop a plausible strategy
which brings these conflicts to a conclusion in a measurable
period of time. Otherwise we're going to repeat the
nightmares of the Indo-China conflict in which we do just
enough to be engaged and not enough to prevail.

QUESTION: "How should President Bush best utilize Vice
President Quayle?"

ANSWER: The vice presidency is not a glorious job. No
Vice President has ever been given permanent responsibilities
because he is the one member of the entourage of the

-19-

President you cannot fire. And therefore as a practical pro-
position, every Vice President that I've ever known has been
given commissions, ad hoc assignments, anything that ends in
a measurable period of time, and that does not enable him to
get into continuing operations.

So the best thing I think can be done with the Vice Pre-
sident's office is more or less what President Reagan did and
what President Bush seems to be doing; that is to say, let
the Vice President sit in on all important meetings and
thereby let him learn what the thinking of the Administration
is. And that is not an unimportant role because that means
that he is the only senior member of the Administration who
can sit there and observe and think, and is not driven by the
immediate requirement of managing a bureaucracy.

Secondly, obviously he can be sent, as Vice President
Quayle was, as other Vice Presidents have, to inaugurations,
funerals and events at which he can meet other world leaders
and bring certain messages.

Third, he can be given occasional missions like a com-
mission against drugs and so forth.

I think that Vice President Bush, having served under
President Reagan and been treated in that manner, will sub-
stantially treat Vice President Quayle in the same way. And
since the major constitutional role of the Vice President is
really to replace the President in case of a disaster, that
is in my view the best use of him. And actually, I must say,
I know Vice President Quayle. I knew him as a Senator. I
think that the media presentation of him has been an absolute

-20-

caricature. I think he will perform his role with ability
and dignity. (Applause)

QUESTION: "Is our trade deficit a serious handicap to a strong foreign policy?"

ANSWER: Well, in any one year our trade deficit is not a decisive handicap, but cumulatively over an extended period of time I think a permanent trade deficit makes us financially more and more dependent on outside borrowings. Therefore, I think reducing the trade deficit is in many ways even more important than reducing the budget deficit because the budget deficit is shrinking anyway as a percentage of the Gross National Product. But the trade deficit is the one that puts us in permanent hock to the outside world and may, at some point, produce a financial crisis if foreigners are no longer prepared to lend us money.

QUESTION: "With the new role of the European Economic Community, do you think that the U.S. can insist that they bear the major cost for NATO?"

ANSWER: I believe that the Europeans must assume a greater responsibility for the defense of Europe. But I don't think that can be done within the present structure of NATO. In the present structure of NATO, the defense policy of the defense of Europe is largely in American hands. We design the concepts; we design most of the weapons; we furnish the commander; and under those conditions when you go to the European parliaments and ask them to pay more money, it is to pay more money for an American burden. That is a very difficult thing to put across and it's also not a very

-21-

sensible thing since Europe has a larger population than the
Soviet Union and a much larger Gross National Product.

So I believe that as the European Community forms itself
economically, it should also create a political and, above
all, a military community. I believe that in the next decade
the NATO commander should be European and not American, you
can have an American deputy for nuclear matters. And once
defense policy becomes designed by Europeans, so that it is
their policy and not our policy, then the question of
burden-sharing is not the issue of whether they share our
burden, but how much they're willing to pay for their own
burden -- which is the way that it should be. And I think
that if it is conceived in that manner, even though it will
create some inconveniences for us in an interim period as we
shift to the new system, this is the direction in
which we ought to go.

QUESTIONS: "What steps should be taken in our relationships with the Peoples Republic of China? Should we back out or reduce our support to Taiwan?"

ANSWER: To take the second question first, I do not think we should reduce our support for Taiwan. The United States cannot be known around the world as abandoning over a period of time every friend we have had. On the other hand, I have a great personal commitment to better relations with the Peoples Republic of China. And again I would say with respect to the Chinese, whom I genuinely like, ~~I would never~~ say we have to approach them in the same manner that I described earlier with the Soviet Union. Nations cooperate

-22-

not on the basis of personal friendship but on the basis of
self-interest. The Chinese relationship with us was estab-
lished not because the Chinese missed contact with Americans.
They had lived without contact with Americans for 2,000 years
and would have been happy with another 2,000 years of no con-
tact with us, except that the international environ-
ment was getting extremely dangerous. At their northern
border they have the Soviet Union at a 4,000-mile frontier,
and a history in the last century of constant Russian expan-
sion across Asia.

On the other side they have Japan, about which they are
extremely worried. And it has always been Chinese foreign
policy to use the distant barbarians against the close-by
barbarians. And therefore, the relationship with the United
States is based on the proposition that, in the Chinese eyes,
we are needed for a world balance of power, and we are less
dangerous because we are so far away that there is nothing
physical we can want in China. That is the basis of our
relationship with China. Therefore, the best way to deal
with the Chinese is not to pretend that we can charm them.
They have seen foreigners come and go in Beijing for 3,000
years of recorded history. They're not going to be charmed
by us. The best thing we can do for our relations with them
is to explain to them exactly how we understand the inter-
national environment, what we think is needed and what the
possibilities are. Then they'll make their own judgment.

Now Gorbachev is going to go to Beijing. He isn't going
to charm them either. I think Americans should stay very

-23-

cool. We should not ask for reassurance from the Chinese
because words by themselves don't mean anything. We should
rely on the realities that I have described which are that it
is too dangerous for the Chinese to put themselves entirely
into the hands of the Soviets. Therefore, they will not be
antagonistic to the United States. They will try to improve
their relations with the Soviets somewhat, but they will also
try to maintain their relations with the United States. And
therefore I think a measured approach to the Chinese is the
right one.

Secondly, we ought to keep in mind that of the two big
Communist countries, the Chinese prospects for economic
success are much greater than for the Soviet Union. The
Chinese are culturally homogeneous. They are not like the
Soviet Union, a collection of nationalities. The Chinese
have an entrepreneurial tradition which the Soviet Union does
not have. The Chinese have Taiwan, Hong Kong, Singapore and
overseas Chinese from whom they can learn about a market
economy. None of this the Soviet Union has. And when you
visit China with all the troubles that they have and with all
the ups and downs, the fact is wherever you go you see new
buildings going up and you see a lot of activity. So I think
that over a period of 20 years economic relations between
China and the United States can improve considerably and I'm
quite optimistic about our relationship. But we shouldn't
let ourselves get stampeded by the Gorbachev visit to
Beijing. That's their problem and the more nervousness we
show, the weaker our bargaining position will be.

-24-

QUESTION: "Are you secretly running the Bush foreign policy team?"

ANSWER: Two close friends of mine have been appointed to very responsible positions in the Bush Administration. They were appointed on merit, not because I recommended them. In fact, as painful as it may be for me to admit, I wasn't asked ahead of time what I thought of them. (Laughter) Anyone who survives with me for 25 years has to be a person of wild individualism and strong personality. These people are tremendous assets to the Bush Administration. But if I want to make a suggestion to the Bush Administration, I will make it to the President or the Secretary of State, not through surrogates. And the foreign policy of the Bush Administration will be run obviously by Pres. Bush and Baker, and I must say they have done very well for the last two weeks. (Laughter) I don't want to commit myself beyond that point because I want to tell you what I said to President Bush the other day. I said, "You've taken two key people out of Kissinger Associates. Now my other source of activity is to write a column. Please keep in mind that I have to write 1,500 words every time I write a column and 'I agree with George Bush' is only five words. So if you conduct a foreign policy I can agree with, you ruin me."

(Laughter and applause)

WILLIAM P. VITITOE: Dr. Kissinger, we thank you so very much for taking time to share your thoughts with us today. You were more than successful in discussing the geopolitical outlook for the 90's. Thank you. We are adjourned.