PRESS
DEPARTMENT OF STATE

[LC]

May 2, 1975

No. 229

SECRETARY OF STATE HENRY A. KISSINGER TO VISIT ST. LOUIS - KANSAS CITY, MISSOURI, MAY 12-13, 1975

On May 12 and 13 Secretary of State Henry A. Kissinger will visit St. Louis and Kansas City, Missouri. In St. Louis on May 12 he will deliver an address at a dinner sponsored by the St. Louis World Affairs Council and local civic organizations. The following day the Secretary will fly to Kansas City, where he will speak at a luncheon meeting hosted by the Kansas City International Relations Council. While in Kansas City, the Secretary will also hold a press conference.

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For further information contact:

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INTERVIEW OF

THE HONORABLE HENRY A. KISSINGER
SECRETARY OF STATE

WITH

BARBARA WALTERS
NBC-TV "TODAY" SHOW

Monday, May 5, 1975

PART I

**MISS WALTERS:** Mr. Secretary, we are about to celebrate our bicentennial. Is Viet-Nam our first defeat in 200 years?

**SECRETARY KISSINGER:** When a nation is engaged in a major effort for 10 years and then doesn't achieve its basic objectives, you have to say it is a significant setback, yes.

**MISS WALTERS:** Is Viet-Nam our first defeat in 200 years?

**SECRETARY KISSINGER:** Well, it depends how you assess the war of 1812 and other events. It is a significant setback.

**MISS WALTERS:** You are responsible for the airlift of more than 100,000 Viet-Nam refugees. How do you answer the American people who are worried about further economic deprivation and are resisting the arrival of these refugees?

**SECRETARY KISSINGER:** It has been the American tradition to take refugees throughout our history even from countries to which we had no special obligation. We took 675,000 Cuban refugees. We took I think over 150,000 Hungarian refugees. Here is a country in which for 15 years we were engaged in a major effort in which hundreds of thousands of people cooperated with us in the belief that the United States would see this effort through. The least we owe these people, those who were most seriously endangered, is that we make an effort to evacuate them.

I think when the American people reflect about our obligation they will recognize that we could not decently do anything else. The number is about 120,000. It is one of the things that we can be proud of having achieved. I think it is a national duty to help them. Moreover, I believe that the impact in any one locality is going to be absolutely minimal.

**MISS WALTERS:** Mr. Secretary, right now at this point of our history how do you see the fundamentals of our foreign policy and are they being re-defined since the fall of Viet-Nam?

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**SECRETARY KISSINGER:** The fundamental goal of our foreign policy has to remain to preserve peace and to achieve progress — economically, humanly and politically — in the world.

Now there is a curious situation in which many people say there is no domino effect, but we have to redo all our foreign policy. Both propositions cannot be true.

I believe that the major objectives which the United States has set itself are dictated by our history, by our values, by our geography. They are unaffected by what has happened in Viet-Nam. They are more difficult as a result of our setback, but we can master them and we will master them.

While Americans have some reason to be unhappy for various reasons about the outcome of Viet-Nam, if we look at the whole post-war record, we have preserved the global peace. Almost every great initiative in the post-war period has either been initiated by America or has been carried out with our strong support. If we want to avoid a world of chaos, if we want to achieve a world of progress, the American role is absolutely imperative. I repeat, it is our goal to maintain it and, based on our recent experience, to strengthen it in a more mature way.

With respect to Indochina, it is important to remember that we found 550,000 Americans in Indochina when we came into office. We didn't put them there. In fact, we withdrew them.

Our attempt has been to gear American commitments to American capabilities and necessities.

**MISS WALTERS:** I would like to divide our foreign policy questions now into different parts of the globe, starting with the Far East, to Viet-Nam. At the time of the Paris peace treaty many people felt, perhaps cynically, that it was only a matter of time before North Viet-Nam took over all of Viet-Nam and that the withdrawal of our troops was our way of getting out and saving face.

These people wonder why you didn't know this and have some alternate plan should Viet-Nam push south.

**SECRETARY KISSINGER:** First of all, if so many people knew it, they managed to keep it rather quiet. I don't remember any very vocal statements at the time that pointed out what you have just said.

Secondly, when you say why didn't we have an alternative plan, I would have to know what sort of a plan do people have in mind, what could we have done?

**MISS WALTERS:** Let me make a suggestion — not to run your foreign policy. But for example, one alternative is, after Congress had the arms cutoff, we might have gone to President Thieu and told him, "Look, it is a new world and you had better negotiate unless you want defeat."

**SECRETARY KISSINGER:** Let me first go back to where we were in January 1973 and where we wound up in April of '75. In January '73 we did not foresee that Watergate would sap the Executive authority of the United States to such a degree that flexibility of Executive action inherently would be circumscribed. We did not foresee that the Congress would pass a law which prohibited us from enforcing the Paris Agreement; and while we probably might have done nothing anyway, it makes a lot of difference

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for Hanoi whether it thinks the United States probably will not or whether it thinks that we certainly cannot.

I do not believe that Hanoi would have sent 19 of its 20 divisions south if these two things hadn't happened, nor did we foresee that aid to Viet-Nam would be cut in successive years by 50 percent each year at a time when inflation quadrupled the oil prices and inflation increased the cost of everything.

So that after May 1974 no new equipment of any kind was sent to Viet-Nam and not even spare parts in any substantial quantities reached Viet-Nam, so that ammunition had to be rationed for the Vietnamese forces. Maybe the South Vietnamese army was not ever one of the better armies in the world, but even a good army would have been demoralized by these successive cuts.

None of this was predictable. After it became clearer that a gradual erosion of morale was occurring we tried very hard to get negotiations started and President Thieu, whatever you may think of him, on a number of occasions made proposals to get these talks started unconditionally.

But once the North Vietnamese realized what the trends were, they blocked all negotiations and went for a military solution.

**MISS WALTERS:** So that you feel there was no other possibility?

**SECRETARY KISSINGER:** There was no other possibility.

**MISS WALTERS:** It is now known that President Nixon wrote a letter to President Thieu in January of 1973 promising that the United States would move full force to punish any violations of the Paris Peace Agreement. You obviously knew of the context of this letter.

**SECRETARY KISSINGER:** Of course.

**MISS WALTERS:** Why didn't you reveal to Congress in the past months the contents of that letter, especially when Senator Jackson raised this question?

**SECRETARY KISSINGER:** It is a very important question of the conduct of foreign policy. Presidents have been writing letters to foreign heads of state since the founding of the Republic. During the difficult months when we were trying to convince President Thieu to accept the Paris Accords, many letters were written — just as every President, including President Ford, is writing, has been writing letters to foreign heads of government.

If we begin revealing the contents of letters simply because a Senator, on top of it a Presidential candidate, but quite apart from this a Senator alleges that there is something in these letters, then Presidential correspondence will lose its private character.

Moreover in this particular case, President Ford announced that the substance of these letters had been made public, not ascribed to correspondence, but in fact had been made public.

The reason President Ford decided to not release these letters was to maintain the principle of confidentiality of Presidential correspondence.

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We do have an obligation to tell the Congress about obligations which the country has undertaken. That was done in many public statements in 1973 and they were made moot by Congressional actions and after that it was not an issue.

**MISS WALTERS:** Mr. Secretary, this brings up one of the criticisms about you today. That is, people say Henry Kissinger deals in excessive secrecy. There are other letters and other deals perhaps being made at other conferences and other summits that perhaps the Congress doesn't know about.

How does one resolve that and how do you answer that criticism?

**SECRETARY KISSINGER:** Once certain stereotypes develop, it is very difficult to deal with them. I am certain that if I read top secret documents in front of the Washington Monument to a public assembly I would still be accused of conducting foreign policy too secretly. One has to separate it into two parts.

The first is: Secrecy in negotiations is absolutely essential because it enables each side to state views and explanations which could be extremely embarrassing if they became public. It is absolutely required for the foreign leaders who deal with us to know that they can talk to us frankly.

Therefore, the secrecy of the negotiating process must be preserved.

Charles Evans Hughes said in 1923 that open diplomacy can only refer to results, not to the process.

The second point is: Are there secret agreements that people don't know about and that have been kept from the public? Well, so far, with all the allegations that have been made, nobody has yet produced any secret agreement that has not been made public. At one time there was an allegation that we had made some secret agreement about 70 missiles. That turned out to be an absurdity, but it is so complicated to explain that I don't want to go into it now.

At any rate, that was an absurdity.

The second argument that has been made is that we did not reveal a Gromyko letter about Jewish emigration. It is true that we did not reveal the letter, but the substance of that letter was fully disclosed to the Senate in the testimony before the Senate Finance Committee on December 3, 1974.

The third charge has to do with the war in Viet-Nam, with the end of the war in Viet-Nam. There, too, the substance was fully explained. There are no secret agreements. No one has as yet produced any secret agreements. All they have produced are limited statements that were fully revealed to the public.

**MISS WALTERS:** Mr. Secretary, do you see our Government recognizing the North Vietnamese Government?

**SECRETARY KISSINGER:** Well, we now have to see what the conduct of this Government is internationally and partially domestically. For example, we know that in Cambodia very tragic and inhuman and barbarous things are going on. We don't regret not having recognized Cambodia immediately.

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We want to observe the conduct of the Vietnamese Government for a while
before we make this decision.

**MISS WALTERS:** Can you tell us what part the Soviet Union played diplomatically, militarilly, during the waining days of the South Viet-Nam collapse?

**SECRETARY KISSINGER:** The Soviet Union played, in the last two weeks, a moderately constructive role in enabling us to understand the possibilities there were for evacuation, both of Americans and South Vietnamese, and for the possibilities that might exist for a political evolution.

On the other hand, I do not want to give the Soviet Union excessive credit
for moderating the consequences that its arms brought about.

Therefore, we have to see it in perspective.

**MISS WALTERS:** Did the Soviet Union tell you that there would be no possibility of a negotiated settlement, that it was going to end in a takeover of the city?

**SECRETARY KISSINGER:** That was not clear to me from the exchanges.

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PART II

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INTERVIEW OF
THE HONORABLE HENRY A. KISSINGER
SECRETARY OF STATE
with
BARBARA WALTERS
NBC-TV "TODAY" SHOW

Tuesday, May 6, 1975

PART II

**MISS WALTERS:** We talk of detente with the Soviet Union, but how do we reconcile detente with the country that aids the collapse of an ally we are committed to defend?

**SECRETARY KISSINGER:** We have to understand what detente represents. The Soviet Union is a country that we recognize as ideologically hostile. The Soviet Union is a great power that is in many parts of the world operating competitively with us. The Soviet Union is also a country that possesses an enormous nuclear arsenal and with which we have certain interests in common such as the prevention of general nuclear war, such as limiting conflict in areas where both of us could get directly involved.

In those areas detente has worked reasonably well. What we cannot ask the Soviet Union to do is to keep itself from taking advantage of situations in which, for whatever reasons, we do not do what is required to maintain the balance.

It is true that Soviet arms made the conquest of South Viet-Nam possible. It is also true that the refusal of American arms made the conquest of South Viet-Nam inevitable.

Therefore, while the Soviet Union does have a heavy responsibility, we cannot expect the Soviet Union to police the world for us and we have to be mature enough to recognize that we have to co-exist, even in a competitive world, and perhaps hopefully be able to moderate over a period of years the competition in peripheral areas.

Now eventually the Soviet Union must realize that it is responsible for the consequences of its actions even in peripheral areas.

But as a basic relationship detente has never meant the absence of competition.

**MISS WALTERS:** Where does China stand now as a result of the fall of Saigon?

**SECRETARY KISSINGER:** Well, China now has 40 million Vietnamese on its frontiers who do not exactly suffer from a lack of confidence in themselves. I think China will look at the international situation from the point of view of the overall balance of power, from the point of view of its own national interests. I think it will conclude that the

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policy that led it to undertake normalization of relations with the United States remains the best course for it, just as we believe that the normalization of relations with the People's Republic of China is an important objective of American policy which will be maintained.

**MISS WALTERS:** Mr. Secretary, Thailand's Foreign Minister has said all American soldiers will be totally gone from that country within one year. What does that mean to us?

**SECRETARY KISSINGER:** Basically, as we assess our policy around the world, it is important to understand that the United States does not do favors to other countries by being in an alliance with them, nor do other countries do us favors by being our allies. If other countries want us to withdraw our troops, we will of course withdraw them.

Our security can be protected in many ways. What it means, however, is that for the Thai leaders the last few months have been a traumatic experience. Thailand supported our efforts in Viet-Nam and in Indonesia because it believed its own security was intimately connected with it. And it is well known that we used Thai bases for many of the operations of the Indochina war. So naturally the Thai leaders are concerned about what this means, what our withdrawal from Cambodia and Viet-Nam means, about our general attitude in foreign policy. And I think they will find that we are going to stick by our commitments.

If they want us to reduce our forces, and they have indicated that they do, and if they want us to withdraw them, we are prepared to discuss this with them and of course we will accede by their wishes.

**MISS WALTERS:** Senate Majority Leader Mike Mansfield has said that we should withdraw our troops from South Korea, probably the next target of Communist pressure. Do you think we should? Has South Korea asked us to?

**SECRETARY KISSINGER:** South Korea has not asked us to. In South Korea there can be no ambiguity about our commitment because we have a defense treaty ratified by the Congress. If we abandon this treaty, it would have drastic consequences in Japan and all over Asia because that would be interpreted as our final withdrawal from Asia and our final withdrawal from our whole post-war foreign policy.

**MISS WALTERS:** Is there a redefinition of the domino theory in light of the internal rebellions going on in such countries as Thailand, the Philippines and Malaysia and, as part of that, have we as a result of Viet-Nam stopped trying to persuade governments to resist Communism?

**SECRETARY KISSINGER:** There are two aspects to the domino theory. The first is: Is there a domino effect to foreign policy action? The second is: Can we, as a country, do something about every domino effect that may occur in the world?

**MISS WALTERS:** I like your questions much better than mine. They are more understandable. They are clearer.

LC

PART II

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**SECRETARY KISSINGER:** With respect to my first question, there is in almost every major event a domino effect that is produced either by the change in the balance of forces, or by the perception of other countries of the actions of the various participants, or by the general psychological climate that is created in the world as to who is advancing and who is withdrawing. That is inevitable.

What the United States can do about it is another matter. For example, with respect to Indochina we now receive cables from places as far away as Latin America and Africa, that have no geographic interest in Southeast Asia, simply questioning what this means about the American purpose.

Now, does it mean that the United States is no longer urging countries to resist internal subversion?

The first decision whether to resist internal subversion must come from the countries concerned. We probably made a mistake in Viet-Nam to turn Viet-Nam into a test case for our policy and not for the Vietnamese policy back in 1962 and 1963 when we first got ourselves involved there.

So our general attitude would be that the basic decision of how to react to internal subversion depends on the countries concerned.

**MISS WALTERS:** Let me go back to that. Does that mean we should have realized that the trend was towards Communism and said we will stay out?

**SECRETARY KISSINGER:** No, but we perhaps might have perceived it more in Vietnamese terms rather than as the outward thrust of a global conspiracy.

**MISS WALTERS:** Okay.

**SECRETARY KISSINGER:** Then if there is a decision to resist internal subversion, I would think that the introduction of American military forces is the worst way of dealing with it because that introduces a foreign element. If we want to be helpful we would be much better off strengthening the government's ability to resist and giving it assistance rather than introducing American military forces.

But as a general rule, one would really have to look at that country by country. We don't have a blanket policy in this respect that applies to every country in the world.

**MISS WALTERS:** Mr. Secretary, can we talk of the Middle East? President Ford and you are due to meet President Sadat in Austria next month and later with Prime Minister Rabin in Washington. What possible avenues for new negotiations do you see?

**SECRETARY KISSINGER:** We do not have a plan that we want to present to these two governments now. But we do have the conviction that a prolonged stalemate in the Middle East involves a high risk of another Middle East war with major consequences for the possibility of a

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conflict with the Soviet Union and with a major impact on the economies of all of the industrialized nations, including us. This is a danger that we are determined to avoid. We believe that it is also in the interest of all of the participants, all of the parties in the Middle East, including especially Israel.

So we will talk to President Sadat and, when we meet, Prime Minister Rabin and other leaders about their ideas of how the Middle East can be moved to a solution. And after that we will formalize a precise American policy.

**MISS WALTERS:** It has been widely noted that you and the President criticized Israel for not being more flexible. What was the purpose of this private criticism?

**SECRETARY KISSINGER:** You know, Barbara, there are so many myths that go around. The President made a public criticism, not a private criticism, when he referred to inflexibility.

In terms of the long-term consequences, I have expressed the view that a strategy which on the whole had been agreed to with the Israeli Government did not succeed.

The purpose has been not of criticism, but the purpose of making clear the general American perception of the problem was to make clear that new decisions had to be taken by all of the parties and that the progress towards peace in the Middle East cannot be stopped.

**MISS WALTERS:** But when you publicly or privately criticized Israel, didn't this release President Sadat from re-examining his policy?

**SECRETARY KISSINGER:** We have asked all parties to look at their policies and the allegation of private criticism of Israel comes mostly from people who think they are helping Israel but who in my view are not helping Israel by making these allegations.

Our view is that all parties on both sides have an obligation to examine what they can do to produce peace.

On the Israeli side this is a question of what territory they are prepared to give up.

On the Arab side it is a question of what concrete commitments to peace they are prepared to make.

**MISS WALTERS:** Almost six weeks ago, President Ford asked for a reassessment of our policy in the Middle East. I know you have not finished the reassessment. They say it will take another week or so. But can you tell us anything of what has emerged?

**SECRETARY KISSINGER:** First of all, when President Ford announced this and set a tentative deadline, it was before events in Indochina took a great deal of our attention.

(lc)

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Secondly, it is a mistake to believe that there will be some clear
terminal date at which one can say from now on the assessment is com-
pleted. But I believe that on the whole the decisions, the final
decision, will not be made until President Ford has had an opportunity
to meet with the leaders of the countries principally concerned.

But the conclusion to which we have come is certainly to continue a
major American effort to produce progress toward peace in the Middle
East and not to permit a long period of stagnation.

**MISS WALTERS:** What assurances do Israel and our other allies have that we will keep our commitments to them? As soon as Israelis hear "reassessment," and other allies too, it seems to strike great fear that it could mean abandonment or great change. What assurances do they have?

**SECRETARY KISSINGER:** The President has, on several occasions, made clear — and so have I — that we will stand by our existing commitments.

**MISS WALTERS:** Could Congress change this?

**SECRETARY KISSINGER:** Certainly Congress can change our commitments, as it did in Viet-Nam — not our commitments, our implied obligations.

But the situation in Viet-Nam was quite different from the situation
in other parts of the world. In Viet-Nam the situation was extremely
controversial. It has not been that with respect to Israel or with
respect to Western Europe and most of our other alliances. But
Congress can certainly change any commitment we have.

**MISS WALTERS:** But do you feel that Israel and these other allies have good reason to be assured that the basic policy will not change?

**SECRETARY KISSINGER:** Assurances are not achieved with words alone. It depends on our conduct as a people. In terms of the foreign policy of this Administration, our allies and friends have no reason to fear that we will abandon them.

In terms of our overall performance as a country, it is crucial that we restore a sense of unity between the Executive and Legislative branches and that we perform in such a manner that other countries know that we are dealing with them as a united people.

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PART III

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INTERVIEW OF

SECRETARY OF STATE

WITH

BARBARA WALTERS

NBC-TV "TODAY" SHOW

Wednesday, May 7, 1975

PART III

**MISS WALTERS:** If we turn now to Europe, our base in the Portuguese Azores was essential to the military airlift of aid to Israel in the October War. Portugal has said she may not allow this to happen again.

**SECRETARY KISSINGER:** She said she will not allow it.

**MISS WALTERS:** Do we have alternate plans?

**SECRETARY KISSINGER:** We have alternate possibilities, but they are much more complicated and involve a much longer route.

**MISS WALTERS:** Are you very concerned about this?

**SECRETARY KISSINGER:** It is an additional problem in case there is a Middle East war.

**MISS WALTERS:** What are our relations now with Portugal? What do you see happening with this?

**SECRETARY KISSINGER:** The situation in Portugal is in a state of evolution. There recently were elections which indicated gratifyingly that a majority of the Portuguese people favored the democratic parties. It is also a fact that the Government has a very heavy Communist influence, out of proportion to the numerical strength that the party represents. So we have to assess what the foreign policy of Portugal will be before we can make any final decisions.

**MISS WALTERS:** You will be visiting and trying to reassess our relations with NATO, our participation in NATO. Do you expect Turkey and Greece to remain in NATO? Realistically, as things are now?

**SECRETARY KISSINGER:** I hope very much that Greece and Turkey will stay in NATO. I think it is in their self-interest to stay in NATO, but the national passions are very great. They are now negotiating in Vienna — the Greek and Turkish community in Cyprus are negotiating in Vienna. We hope that during the NATO summit the President and

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others will have an opportunity to exchange views with the Greek and Turkish leaders, and we hope that we can play a role in moving things towards a negotiated outcome.

**MISS WALTERS:** But you have expressed yourself as being very gloomy about what you see as the decline and erosion of the free world.

**SECRETARY KISSINGER:** No, it has been alleged.

**MISS WALTERS:** It has been alleged. All right. Are you?

**SECRETARY KISSINGER:** It is not always true.

**MISS WALTERS:** It has been alleged that you are gloomy about what you see as the decline and erosion of the free world. Is this true that you feel this way?

**SECRETARY KISSINGER:** As a matter of fact, it is; it is partly true. It is not so much erosion of the free world. I think if we look around the world today that in many countries Marxist ideologies and perceptions of the world which are contrary to our values are gaining in strength and that therefore we have in the world both a political problem and a philosophical problem; that is, a problem of the degree to which we appear relevant to other countries.

In Europe, in some European countries, the left is gaining in strength. I am stating this clinically, as a fact. I am not stating that necessarily the United States can do a great deal about it. It is something to be noted.

**MISS WALTERS:** If it happens, if it kept growing little by little, will it reach us? Has it reached us?

**SECRETARY KISSINGER:** Will it? The United States cannot be an island in this world any longer. We are tied to the rest of the world through the necessities of security, increasingly by the imperatives of economics and inevitably by the modern means of communications.

So I would suppose that the intellectual and philosophical currents in the world will sooner or later affect the United States and then it is a question of what other currents exist here to deal with them.

**MISS WALTERS:** As a historian, do you see us going more to the left or more towards the right? How do you see the trends?

**SECRETARY KISSINGER:** I don't think we are becoming socialistic in this country. This is not at all a trend. But we have had a very sharp division in this country which formerly centered around Viet-Nam, but for which Viet-Nam was really a symbol between a more radical trend and a more conservative trend. And for one of the rare occasions in our history the contest was fought out in almost — it sometimes took extra-legal forms on both sides.

Now I think it is too early to tell in which direction it goes in this country because in this country the traditional element is very strong. It is a country that has very great faith in its existing

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values. So it could really go in either direction. But the major point that I would like to make is that we have the great advantage over many other countries that our divisions are not yet unbridgeable and that people on both sides of political dividing lines can still talk to each other.

I think we must preserve this and try to develop common positions rather than become, as so many other countries, divided into ideological blocs.

**MISS WALTERS:** Mr. Secretary, is there any difference between the foreign policy of President Nixon and President Ford and, if so, how do they differ?

**SECRETARY KISSINGER:** The foreign policy of a great country cannot be changed at the whim of individuals; and if it is perceived that every President starts an entirely new foreign policy, that in itself will create an element of instability in the world.

So if you look at the entire American post-war foreign policy, you will find that the changes in the major directions of the foreign policy haven't been all that significant.

What is different between various Presidents is the style, the method of doing business and when new problems come up they must make their own decisions.

**MISS WALTERS:** Is there anything significantly different between these two men that you can see in the way that they handle foreign policy that influences you, that changes the direction?

**SECRETARY KISSINGER:** Well, I would think that in the conduct of shaping, that in shaping a domestic consensus, President Ford would, on the whole, be more conciliatory.

**MISS WALTERS:** Well, it is considered in general that he is weaker in foreign policy than President Nixon. In his last speech there was a good deal of feeling that President Ford was going to put his own implant on foreign policy, but what he did was to put Henry Kissinger's impact. You read the papers, so you know what I am saying.

**SECRETARY KISSINGER:** This is the sort of gossip that comes out of every White House.

President Ford worked on this speech for many weeks. He spent days and nights on that speech, with many advisors.

Now if advisors choose to put out that there were different points of view which were never apparent in the room and that one advisor prevailed, this makes a dramatic story; but it is not true. This speech reflected the convictions of President Ford.

**MISS WALTERS:** You did not go in the last few days and —

**SECRETARY KISSINGER:** That is nonsense.

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**MISS WALTERS:** — keep yourself in the White House and make the final impact and implant?

**SECRETARY KISSINGER:** That is nonsense. There was only one draft of the speech. I never heard any philosophical disagreements stated while I was in the room, nor did I change anything that already existed. It was predominantly a speech by President Ford which various of his advisors helped to draft.

**MISS WALTERS:** Is he as knowledgeable about foreign policy as President Nixon?

**SECRETARY KISSINGER:** I think he would be the first to admit that when he came into office he was not as knowledgeable about foreign policy. On the other hand, he spends an enormous amount of his time on foreign policy. He moves with great deliberation, great care and great thoroughness; and he masters the subjects of foreign policy with extraordinary attention and skill.

**MISS WALTERS:** I am going to be visiting Cuba as this interview is aired. I will be going with Senator McGovern and some other reporters. This week the Organization of American States meets here in Washington and high on their list is a reassessment of the economic blockade of Cuba. It is suspected if Latin America does this we will go along. What would you want Cuba to do to establish normalcy and if I do see Premier Castro, is there anything that I can ask him for you, for us?

**SECRETARY KISSINGER:** Castro is without any question a remarkable man. I think it is important for Americans to understand that individuals who go into the mountains to lead a revolution are not motivated by economic considerations. If they were, they would be bank presidents and not revolutionaries.

We have made clear to Cuba that we are prepared to improve our relations. We have made certain gestures to Cuba, so far not reciprocated. We are prepared to discuss with the other countries of the Organization of American States the question of blockade, the economic blockade, and to enable them to express their majority view on this subject.

But I think, Barbara, that Castro knows how to get in touch with us. I don't want to make it too tempting for him by using you as an intermediary.

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Thursday, May 8, 1975

PART IV

**MISS WALTERS:** Mr. Secretary, let's talk about you and the criticism that is all around you at this point.

**SECRETARY KISSINGER:** All unjustified. That is my position, and I will maintain it.

**MISS WALTERS:** Well, let's start. It has been said that by your holding two positions — Secretary of State and National Security advisor — the President doesn't have the benefit of hearing diverse views on foreign policy. That is a legitimate point of view.

**SECRETARY KISSINGER:** Leaving aside now the question of whether a man should hold two positions and addressing the question of does the President get diverse advice on foreign policy, the whole purpose of the national security system as it exists is to make sure that the President gets every significant point of view that exists in the bureaucracy. Typically when a major decision has to be made, there will be first a paper in which every agency expresses its view, after which there will be a meeting of the National Security Council at which every agency is represented. So the possibility of keeping anything from the President does not exist and, moreover, any person who has been in a senior position for any length of time knows that it is essential for the President to make sure that the President has heard conflicting points of view, because if he doesn't and anything goes wrong for a reason which you didn't tell the President, his whole confidence in the policy will be undermined.

**MISS WALTERS:** All right. Now you have often said when we have talked in the past about how you present things, how you presented things to President Nixon, that you outlined all the possibilities but you also made recommendations. You are wearing two hats. Should you be? If you were standing out there somewhere looking at this one man holding two jobs, do you really think it is best that he hold both of them?

**SECRETARY KISSINGER:** First of all, I want to make clear that the Secretary of Defense, the Director of the Central Intelligence Agency and any other official who believes he has something relevant to say has very easy access to this President. It is not being blocked.

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-16-

Secondly, the decisions are made at meetings at which everybody is pre-
sent. If the President wants to ask for my recommendations, he doesn't
ask in what capacity he is asking it. Therefore, the question cannot
be answered in the abstract.

I agree with what the President said. If there is an individual who
can handle both jobs and has the confidence of the President, the
President should have the option of combining it. He should not be
forced to either combine it or to separate it. He should have that
option.

MISS WALTERS: Would you resign if either of these jobs were taken away from you?

SECRETARY KISSINGER: I think this is not a time to talk about my resigning.

MISS WALTERS: I am going to have to because other people are, Mr. Secretary. Senator Frank Church, the leading Democrat in the Foreign Relations Committee, has called for your resignation as has the former Secretary of Defense, Clark Clifford. How do you react to men of this stature saying the country would be better off without you? I would like to know how you react as the Secretary of State and how you react as Henry Kissinger when you walk out of the room.

SECRETARY KISSINGER: Senator Church, as I understand it, didn't ask for my resignation. He said we should change our policies or I should resign. I think that whether I resign or not depends on two factors: One, on the President's views as to my utility; and secondly, on my assessment of whether I am serving the country.

After one has been in Washington for six and a half years as I have,
under extremely difficult and sometimes passionate circumstances,
holding a job does not in itself hold any particular attraction. What
I have to consider is the impact internationally if successively the
President, Vice President and the Secretary of State resign, and for
what reason — what reasons are used to bring this about.

MISS WALTERS: This interview is going to run over a several day period. I don't want to miss anything. Can I be assured that you will not resign between now and the end of the airing of this interview. Would you like to say something about it?

SECRETARY KISSINGER: I save my resignations for visits to Salzburg.

MISS WALTERS: You only resign in Austria, is that it?

SECRETARY KISSINGER: That is right.

MISS WALTERS: Mr. Secretary, let's talk a little bit about you on a personal level now. You have been married now, it is over a year, isn't it?

SECRETARY KISSINGER: Over a year, yes.

MISS WALTERS: What has marriage brought you besides a very lovely wife?

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PR #231

-17-

**SECRETARY KISSINGER:** I am very close to my wife. I think it has enormously contributed to my peace of mind and to my ability to deal with temporary adversity.

**MISS WALTERS:** Is there any particular criticism that you feel is particularly unfair and that is prevalent and that you would like to answer?

**SECRETARY KISSINGER:** I don't — I haven't really thought about this.

**MISS WALTERS:** Perhaps the major one is that it has been personal diplomacy, that it is Henry Kissinger's personal one-to-one diplomacy and that hasn't worked.

**SECRETARY KISSINGER:** Well, first of all, to say it has not worked is probably —

**MISS WALTERS:** That is what your critics say.

**SECRETARY KISSINGER:** That is probably an overstatement. If you look at what has been done over the last six and one half years with China, with the Soviet Union, in energy, in food, in getting our troops out of Viet-Nam and our prisoners back, and in starting the process toward peace in the Middle East, I don't think it is correct to say that our foreign policy hasn't worked. I don't want to identify our foreign policy with me personally.

**MISS WALTERS:** Everyone does.

**SECRETARY KISSINGER:** But I do not think Americans should accept the proposition that their foreign policy hasn't worked because it has worked. We have had some setbacks, but nobody is batting 1000. Most of our setbacks, many of our setbacks, have been caused by domestic problems. But on personal diplomacy, all diplomacy is to some extent personal.

Finally, the thing that probably will last longest, one of the aspects that will last longest is to get into the key positions of the Department of State the ablest younger people in the Department so that I think now the Department of State has the most tough-minded and most forward-looking group it has had in 20 years. I am not working alone. I am working very closely with my associates.

**MISS WALTERS:** How is your staff going to feel when they hear you complimenting them? Aren't they going to get the bends just from the change?

**SECRETARY KISSINGER:** I will make it up in private meetings.

**MISS WALTERS:** In days past —

**SECRETARY KISSINGER:** One of my associates has said the highest praise they can get from me is the absence of abuse.

**MISS WALTERS:** Are you really that tough?

PART IV

PR #231

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**SECRETARY KISSINGER:** I am a perfectionist. I like to try to make people do things that they didn't think they could do. But most of my close associates also become close personal friends.

**MISS WALTERS:** Mr. Secretary, in days past you used to say — when we had conversations sometimes as well — that you wanted to leave office in a sense while you were ahead to avoid the kind of controversy and pain, for example, that a man like Dean Rusk went through. Having said that in the past, do you feel sometimes, do you wish, you could have left sooner?

**SECRETARY KISSINGER:** For me selfishly it would have been better if I had left sooner. But I think, if I may say so, that was at a perhaps more immature period of my life because I should look at this not from the point of view of what may be better for me but for what is better for the country. Right now in these circumstances to leave in a period of turmoil, when people are looking for a sense of direction and when foreign nations are watching us, I think it would not be a service to the country if I left as long as the President has confidence in me and asks for me to stay.

If I ever questions that, I would leave very quickly and without any difficulty.

**MISS WALTERS:** Mr. Secretary, you are a historian as well as a statesman. If you were writing the text, what was Henry Kissinger's greatest contribution and what was his greatest failure?

**SECRETARY KISSINGER:** I am sure there are several things that I wish I had done differently, but when you are in the middle of it I think it is dangerous to claim successes and premature to insist on failures. But there are, I suppose, several things I might have done differently. But the main lines of the policy — this I want to repeat — the main lines of the policy, if I had to do it over again, I would do again, substantially the same way, which may make me unreconstructed and may be one reason why I am at peace with myself.

**MISS WALTERS:** Thank you, Mr. Secretary.

END

[LC]

DEPARTMENT OF STATE

May 9, 1975

No. 245

TOAST BY
THE HONORABLE HENRY A. KISSINGER
SECRETARY OF STATE
AT HIS LUNCHEON FOR THE
LATIN AMERICAN FOREIGN MINISTERS

MAY 9, 1975

I am pleased to be able to welcome you here personally. As friends and neighbors, you are always welcome. But I am especially pleased today, for the 12 months since the OAS General Assembly last met in Atlanta have encompassed enough dramatic world events to upset the best-laid plans — including, regrettably, some in which we were involved together.

This is not the time to go into the details of the issues we are discussing this week. But I want to reaffirm to you now the determination of the US Government to move ahead positively on our hemispheric agenda.

President Ford and I have reviewed US efforts to adapt our traditional friendship to the needs of the times. We agree with you that the historic international principles pioneered in this hemisphere — principles of non-intervention, the sovereign equality of nations, and mutual respect among partners — must not only be reaffirmed, but supplemented by strengthened cooperation for the national development and economic security of our peoples.

In Houston last March I said that the ways in which we of the Americas — North and South — approached these issues would have a profound impact on one of the central dilemmas of our times: the relations between the developing countries and the industrialized nations.

I would like to take a moment now to review with you the impact of recent events on our common search for new progress in the hemisphere and new equilibrium in the world.

We meet at a time of wrenching changes in Southeast Asia and of simmering conflict in the Middle East. Throughout the world, economic difficulties have struck so many countries, and occur against such a generalized backdrop of political uncertainty, that the need for a new set of international economic relationships is ever more apparent.

We would be shortsighted to let the inevitable growing pains and adjustments distract us from the immense potential of this historic period — and from the opportunities we have to realize that potential.

It has been clear for some time that the international system had entered a period of redefinition and that significant adjustments would be required of all countries, large and small.

-2-

The problems of improving political participation, and eliminating poverty are critical to the quality of life on earth. We must give them growing priority. But we must simultaneously seek to assure life by avoiding nuclear catastrophe.

To meet this double challenge of development and security, the United States has developed a foreign policy designed to meet the requirements of the future by building on the gains of the past.

This approach requires broadened cooperation with our traditional friends — in this hemisphere and elsewhere. And, despite ideological antagonisms with our adversaries, it also requires the practical cooperation in certain limited spheres that has come to be known as detente.

The past year has shown that progress toward a new structure of international relations which promotes cooperation rather than force can be very uneven.

But it has not affected the soundness of the objective nor altered its essential framework.

Since we last met as a group, we in the United States have reaffirmed our domestic democracy and the vitality of our institutions. This should not surprise you. You know us well, and you know from your own experience that what may seem turmoil to outsiders frequently conceals inner strength.

It is also true, of course, that the past month has brought a serious reversal for the United States in Southeast Asia. The tragic collapse of the Government of South Viet-Nam has moved us deeply. But it must be understood clearly that the end of the war in Viet-Nam will not mean a withdrawal by the American people from international commitment. We remain committed to strengthening a peaceful world community based on self-determination and fulfillment of all peoples. We will stand by our friends and our commitments. Indeed, with the end of the war in Viet-Nam, we will be redoubling our attention to the great tasks of constructing a new international system.

In this effort, all of us are venturing onto new ground, where there has been little opportunity for ideas to mature or consensus to emerge. The great issues of global cooperation in agriculture, food, energy, and commodities have only begun to be defined. Yet the global agenda of interdependence gives us an opportunity to transcend traditional patterns of thought and action. The United States remains determined to continue to make a major contribution to this agenda.

To achieve our aspirations, the imperative for us all is one of restraint and cooperation. Our priorities and yours coincide in many ways. Our effort to contain the East-West struggle is a strategic imperative. At the same time, the dampening of the Cold War has provided a better opportunity for the expression of your political and economic concerns. Strategic security enables change in the less developed countries to be separated from the East-West struggle.

In the months ahead, the United States will continue to strive for a stable structure of world peace. We will enter a new phase of SALT

-3-

negotiations with the Soviet Union. We will strengthen our alliances in Europe. And we will work with the nations of the Middle East to develop a solution that will prevent the current stalemate from deteriorating into war.

This background of global security will enable the dialogue between industrial countries and the less developed to move increasingly to the center stage. Like detente, it is too important to be overshadowed by temporary setbacks. The recent Paris conference between energy producers and consumers did not reach agreement — but it began an essential process of consultation.

US initiatives to enhance world food production, and our continuing search for an equitable and viable energy relationship mark the path we have decided to take. Our approach will be to seek functional producer-consumer action on concrete issues in support of mutually defensible goals. We will work hard to achieve a new International Coffee Agreement. We are giving careful study to the problem of raw materials.

In a general sense, the past year has demonstrated that the international structure we seek requires broad political participation, both domestically and internationally. It has shown that economic growth cannot be taken for granted, that productivity, whether of raw materials or of manufactures, requires a fair return, and that development is indivisible, requiring common effort on many fronts.

These general lessons apply directly to this hemisphere.

Trade, commodities, multinational corporations, technology are intrinsically global problems. They cannot be dealt with as if we were isolated from the global arena.

But these problems acquire a special dimension in this hemisphere. The relations among our countries are intense and deeply rooted in our particular cultures and national histories. As in the past, our cooperation can make important contributions to improving the equilibrium between industrial and developing countries. And, as in the past, our cooperation can be a symbol of a larger world relationship. The United States will make a major effort to give new vitality to its Western Hemisphere relationships but this can succeed only as a cooperative enterprise.

As we now move ahead on vital issues of trade and development, the lessons of the past year are important.

We have understood that we must move forward on a broad front which includes the settlement of outstanding political issues such as the Panama Canal, as well as economic progress.

We have learned that progress requires the serenity to overcome temporary conflicts and misunderstandings.

The constructive atmosphere of this Assembly clearly demonstrates that we have learned to confront our problems with more perseverance than rhetoric, more humility than anger.

-4-

For we have learned that dialogue in itself does not bring instant change. Interdependence affects the entire fabric of our societies: its complexity will require special efforts from us all.

We must now broaden these efforts and support them with institutional structures that will enable us to translate our growing understanding into action.

I am confident that we will do so together:

- We have almost completed the modernization of the Rio Treaty, thereby strengthening our collective security.

- This General Assembly already reflects the new flexibility required to deal effectively with the challenges of development; we must now proceed to make the equally necessary changes in OAS structure and operations.

As I suggested in my Houston address, we can use our strengthened regional institutions to search for answers in this Hemisphere to the challenges posed by development and interdependence.

I am convinced, for example, that the Western Hemisphere can show the way to the rest of the world in meeting the critical need for increased food production. The Inter-American Development Bank has already begun work to establish the Hemisphere Agriculture Consultative Group I suggested at Houston.

The Inter-American Development Bank is our most important regional development institution. The Administration will seek a substantial US contribution to the capital replenishment to be considered soon.

All of us must examine how we can improve access of the poorer countries of the region to the Bank's concessional funds, while simultaneously broadening alternative sources of capital, management, and technology for all countries.

Above all, we must foster the humane vision of the future that has always marked the Americas. If we can fuse the insights of our artists and poets with the productive skills of our professionals and technicians, we will once again transform the American continent into a vast crucible of ideas and progress worthy of our new attitudes and our special place in the world.

Friends, I invite you to join me in a toast to the health of our presidents, to the self-reliance of our peoples, and to the success of our mutual efforts to bring them together.

*****

The Secretary
of State

Speech

May 12, 1975

St. Louis, Mo.

Bureau of Public Affairs

Office of Media Services

THE CHALLENGE OF PEACE

*Secretary Henry A. Kissinger before the St. Louis World Affairs Council.*

America and the World

We meet here in the aftermath of the tragedy of Viet-Nam. It will be years before it is possible to make a dispassionate analysis of a conflict which we entered so innocently a decade and a half ago, which divided our country more than any event since our Civil War, and which ended so swiftly and painfully.

But the consequences are with us today. Around the world people are asking what recent events mean about our strength, our wisdom, and our constancy. And Americans now ask questions which go to the very heart of our foreign policy: What are our interests in the world? What should be our commitments? Where do we go from here?

Let me begin by stating a profound conviction: The fact that we failed in one endeavor does not invalidate all others. If, in the aftermath of Viet-Nam, we flee from responsibility as uncritically as we rushed into commitment a decade ago, we will surely soon find ourselves in a period of chaos and peril that will dwarf all previous experience. Global peace and America's security, global progress and America's prosperity depend decisively on how we act in the months and years to come.

Americans have every reason to take pride in what their country has achieved in foreign policy. In the 30 years since World War II the United States has done more to preserve peace and promote progress than any other nation in the world. The recovery of Western Europe and Japan, the formation and constant revitalization of our peacetime alliances, the shaping and flourishing of the global trade and monetary system, the economic

advance of the newer and poorer nations, the measures to control the nuclear arms race, the development of a new agenda of global cooperation—these are enduring achievements of American leadership.

We undertook these efforts not as charity but in our enlightened self-interest. For a generation we have understood that without this country global peace could not be maintained. For a generation it has been clear that American prosperity is inseparable from and dependent upon a thriving world economy. Our international effort saved American lives and preserved American jobs.

And these goals have been pursued by every Administration—Democrat or Republican—since the war. They have reflected a consensus of the public, the Congress, and national leaders across the country, in and out of government.

This national unity was our most priceless resource. It was the foundation of our achievements. It must be restored.

If frustration, despair, or a desire for novelty alter the American perception of our international responsibilities and cause us to dismantle our accomplishments, we will produce instability in the world and create untold dangers for our country.

The debate over our international commitment must be placed in this perspective. No doubt we must weigh carefully—as we failed to do in the early sixties—the long-term consequences of new engagements. We must not overextend ourselves, promising what is not either in our interest or within our capability. But we cannot shed our existing responsibilities without straining the fabric of international peace. When people speak of redefining our existing commitments, which ones do they consider expendable? To take just one ex-

PR 247

2

ample: Have they considered how abandonment of South Korea or the Philippines would affect the future of Japan and therefore the future of the entire Pacific area? Any ally that prefers alternative arrangements will not find us insistent on the status quo. But by the same token any ally that prefers existing arrangements will not find us irresolute.

In any event our obligations cannot be use-
fully debated in the abstract. A nation's commit-
ments do not derive simply from legal documents
or legislative undertakings. They are not merely
preferences to be altered at will. If properly con-
ceived they rest on self-interest, based on the ne-
cessities of geography and history and national
values. They are reflected in the sum total of a
country's past policies and actions, the expecta-
tions it has created, the whole texture and record
of its international conduct.

Thus we should not treat issues of prestige or
credibility too lightly or too ironically. A nation's
credibility—the value of its word—enables it to in-
fluence events without having to turn every issue
into a test of strength. When a country's prestige
declines, others will be reluctant to stake their
future on its assurances; it will be increasingly
tested by overt challenges. Given our central role, a
loss in our credibility invites international chaos.
There is no question that the trauma America has
undergone in the last decade—from the assassina-
tion of one President to the resignation of
another—has raised many doubts.

We must work hard to maintain our position.
And we shall.

The leadership role we have exercised for a
generation has never been more vital. The world of
the 1970's is less predictable, more fluid, than the
world of 10 years ago. America's strength is less
dominant, our margins for error narrower, our
choices more complex and ambiguous. New centers
of power and influence have emerged and over a
hundred new nations have come into being since
the Second World War. What we once considered a
monolithic Communist bloc has been fractured by
profound divisions. Our alliances have taken on
new balance and are adjusting to new conditions.
Developing countries are pressing their claims with
fresh urgency and unity. Economic interdepen-
dence has become a fact of life. While the cold war
structure of international relations has come apart,
a new stable international order has yet to be
formed.

A changing world places new demands on our
leadership. Inevitably our policy must be more
flexible, more complicated, more subtle, and more
imaginative than in the early postwar period. But
the link between our international performance
and our national destiny remains fundamental. It
has become, if anything, more crucial.

* Never before in history have the elements of national military power been so vast, so ready, so dangerous—and so ill-suited to political objectives. An upsetting of the strategic equation could doom us; a spiraling arms race could produce a nuclear holocaust. We must prevent both dangers from arising.

* The contemporary world has many centers of power and initiative and many other dimensions of international concern besides military threats to security. In military power the world is still essentially bipolar. In economic power there are several poles—Western Europe, Japan, China, the producers of energy and key raw materials—in addition to North America and the Soviet Union. Political, military, and economic power are no longer necessarily commensurate with each other. Only the United States is strong in all categories. Our responsibilities are therefore inescapable. Our performance has profound consequences whether we act or fail to act.

* Regional and local conflicts still abound. The absence of world war for a generation has made the world too complacent about local wars. But if not contained or resolved through diplomacy, these wars pose grave dangers. A war in the Middle East, for example, carries with it profound risks of global economic depression and confrontation among the major powers. We must do our utmost to prevent this.

* The Indian nuclear explosion of a year ago raises anew the specter of an era of plentiful nuclear weapons in which any local conflict risks exploding into a nuclear holocaust. As nuclear weapons proliferate, nuclear catastrophe looms more plausible—whether through design or miscalculation, accident, theft, or blackmail. The withdrawal or weakening of the American security mantle would accelerate this process. It would give an additional incentive to many countries to seek their security in the development of nuclear weapons.

* The advanced industrial nations and the de-
  developing nations are part of a single global econom-

3

ic system whose stability and growth is a vital American interest. The health of the dollar; the expansion of our trade; the free flow of investment; and the supply and price of energy, food, and other vital raw materials are all essential for our own prosperity. Whether we can accommodate the interest of consumers and producers, rich and poor, will determine whether our children inherit a world of tranquillity or of constant conflict.

* The future of the oceans will be shaped in the next few years. At stake are the reach of our navies, the safety of shipping lanes, the rights to vast economic resources, and the choice between chaos and the rule of law across three-quarters of this Earth.

In short, as technology expands man's reach, the planet continues to shrink. Global communications make us acutely aware of each other. Human aspirations and destinies increasingly are intertwined.

We thus face a vast agenda. It is time for us to stop tormenting ourselves and get to work.

For Americans our own destiny has always gone beyond material or physical well-being. To be true to ourselves we have always been aware of what we mean to others, not only technically but morally. Our Revolution was conceived as vindication of universal truths and of the rights of man. Through the decades of our involvement in international affairs, we have drawn strength from the conviction that our goals of economic and social advance and political freedom were the goals of all peoples; the inspiration for our own achievements lay in the vision of progress we presented to all. This conviction must continue to inspire us.

We cannot abandon values which are inseparable from America. Though we are no longer predominant, we are inescapably a leader. Though we cannot impose our solutions, few solutions are possible without us. There is no other country so endowed to help build a better future. If we sit back, there will be no hope for stability, no resistance to aggression, no effective mediation of disputes, no progress in the world economy. When force becomes the arbiter of conflicts, the standards of restraint in international conduct will erode sooner or later, instability and chaos will become the order of the day with inevitable and tragic consequences for us as well as for others. If there is no accommodation of conflicting economic interests among the industrial nations, or

between the industrial and the developing nations, we will face increasing economic strife, of which the oil price rise and embargo will be only the beginning.

So today we face these questions: Will the world be consumed in anarchy—in economic warfare, proliferating weapons of destruction, and regional conflagrations? Or will a new pattern of stable international relations be established, bequeathing a prospect of lasting peace to succeeding generations? Will Americans be so discouraged that we pull away the essential pillar of stability and progress that we have maintained for 30 years? Or will we continue to recognize that our contribution is essential to peace and progress?

We know too much depends on this country to allow us the luxury of retreat. If the United States responds to the challenge of building a peaceful and growing new world with imagination and perseverance, if we make clear to the world that we know where we are going and that we are on course, we have ahead of us a new era of great achievement for all of mankind. That is our deepest obligation and our most important commitment.

## The Design of Peace

In our effort to build a better and safer world, we start from the bedrock of our Nation's physical strength—the vitality of our economy, already beginning to recover from recession; our technological supremacy; our military forces second to none. All of these have been indispensable to our security and progress. They remain so.

All foreign policy begins with security. No great nation can afford to entrust its destiny to the whim of others. Any stable international system therefore requires a certain equilibrium of power. Our security and that of our allies rest ultimately on deterrence of possible challenges, on ensuring that others have no choice but to exercise restraint.

Therefore it is our national and international duty to maintain our military strength, in categories relevant to the political dangers we face. An assault on our defense budget would give a dangerous impression of the trend of American policy, particularly at this moment. Of similar importance is the economic health of this Nation—the recovery of full employment, production, and prosperity. For this is the foundation of our strength and that of all the industrial democracies.

But the more profound challenge is to anchor

4

[LW]

stability not in the negative restraint of deterrence but in the positive reconciliation of interests. The values and intangibles that motivate men and nations have profound weight in the international balance. A stable peace requires a shared stake in its preservation; it must be considered just.

Power without purpose is sterile; strength without direction leads to incoherence and inconsistency. To achieve peace and progress we must understand the contemporary historical trends and have a design of our own to shape them. The achievement of peace requires a vision of peace.

And this vision must be broadly based. Our people must understand the full complexity of our task; why we must maintain alliances even while striving to ease tensions with adversaries; why we need a design for cooperation between the rich and the poor nations even while many developing countries engage in the rhetoric and often the practice of confrontation. It must have scope to include both the new problems of interdependence and the persistent traditional issues of politics and security.

**Allies and Friends.** America's alliances—particularly with the industrial democracies of Western Europe, Canada, and Japan—have been the cornerstone of world stability and progress. We share common conceptions of the dignity of man, a common conviction of a linked destiny, and a common interest in peace and prosperity. This truth has been reinforced, not weakened, by changing global conditions. This is why this Administration considers our allies and friends our first priority. This is why the President will visit Western Europe 2 weeks from now to reaffirm our solidarity at a summit meeting of the leaders of the North Atlantic alliance. This will be the theme of our conversations with the Prime Minister of Japan in early August—and with every other ally.

We will stress that the cement of our relationship should not be verbal reassurances but joint great enterprises. We face a vast agenda: Our alliances were formed when the world was divided into two blocs and the United States was preponderant in the West; today we must harmonize the policies of strong independent states under conditions of eased international tensions. Our alliances represented initially a response to a military threat; today, we must base our unity on shared efforts across a broad range of human activity. A whole spectrum of challenges calls the industrialized

nations to joint action; the need for an equitable and stable world trading and monetary system; the imperative for cooperation in energy development and conservation and in dealing with the energy producers. We are beckoned by the entire agenda of interdependence in food, in raw materials, and in giving meaning and significance to life in modern industrialized societies.

Thus, far from being gloomy about the prospects of our alliance, we shall call our friends to joint enterprises equally important and perhaps more exciting than the earlier quest for security. None of us can deal with this agenda alone. We are inseparably linked to each other—by interdependent economies and human aspirations, by instant communications and nuclear peril. Whether our alliances thrive today depends not on reiterating verbal pledges but on our ability to make our collaboration equal to our opportunity. It is with the conviction that our greatest period of creativity is ahead of us that the President will travel abroad in 2 weeks.

**Detente.** One of the legacies of a simpler period of American history is the conviction that we can pursue only one strand of policy at one time—either strength or conciliation, either relations with our allies or improving relations with our adversaries.

But the fact is that we do not have such a choice. In a complicated world in transition it is important to recognize that if we do not pursue all these strands, we shall not be able to pursue any of them. Our people expect their government to work for stability and peace, not to seek out confrontation. If we are faced with a crisis the American people must know that it was forced upon us. Our alliances can be vital only if they are sustained by the conviction that their purpose is not to produce tension but to provide incentives for an ultimate settlement.

It is in this context that we must judge the contrast between the state of United States-Soviet relations today and 15 years ago. The world is no longer continually shaken by direct and bitter confrontations. There is a general understanding that tensions, when they occur, are not the result of U.S. intransigence and this has enhanced our influence. It would be dangerous to take these achievements for granted; undoubtedly a world neatly divided between black and white was

5

psychologically easier to handle but it was also
infinitely more dangerous.

We therefore should beware of the siren song
that detente is a trap, a one-way street of American
unilateral concession.

In this Administration it will never be. In pursuing detente we will be guided by the following principles:

* We are not neutral in the struggle between freedom and tyranny. We know that we are dealing with countries of opposed ideology and values.

* But we owe our people and mankind an untiring effort to avoid nuclear holocaust. In the thermonuclear age, when the survival of civilization is at stake, we cannot defend peace by militant rhetoric.

* We must outgrow the notion that every setback is a Soviet gain or every problem is caused by Soviet action. In Portugal, the Middle East, even in Indochina, difficulties have resulted as much from local conditions or inadequate U.S. responses as from Soviet intervention.

* We cannot use detente as a substitute for our own effort and determination. Where a vacuum exists, it will be exploited. We have not yet reached the stage where vigilance can be relaxed.

These principles enable us to judge the state of our relations with the Soviet Union. These relations occur on many levels. The first order of business is the imperative of avoiding thermonuclear war. Both superpowers face a problem unprecedented in history; each possesses armaments capable of destroying civilized life. Therefore, however competitive we are and however ideologically opposed neither can attempt to impose its will on the other without an intolerable risk of mutual annihilation. A President has no higher responsibility of sparing our people the dangers of general nuclear war. He can have no greater goal than to put a permanent end to a spiraling arms race which uncontrolled can jeopardize the peace.

The agreement in principal reached last November at Vladivostok between President Ford and General Secretary Brezhnev on a long-term agreement limiting strategic offensive weapons is a major step in this direction. When this negotiation is completed later this year a ceiling will have been placed on the qualitative, as well as quantitative, expansion of strategic forces for the first time in

history. The momentum of military deployments will have been slowed; military planning will no longer be driven by fear of the unknown; a baseline will have been established from which reductions can be negotiated soon thereafter.

Direct communication and consultation between the United States and the Soviet Union and institutionalized cooperation in economic, scientific, and cultural fields constitute the second level of our relationship. The extent of these links is now unprecedented. Naturally there are benefits for the Soviet Union or else the Soviet Union would not participate in them. But they also serve our interest or we would not conclude them. These agreements serve the additional purpose of engaging the Soviet Union at many levels in contacts with the outside world so as to provide incentives for restraint. And they occur in an environment where failure to proceed on our part only opens the door to other industrialized countries perhaps less able than we to withstand the political use of economic relationships—as happened after the failure of our trade agreement with the Soviet Union.

A third level of U.S.-Soviet relations involves the easing of tensions in areas where our vital interests impinge on each other. The Berlin agreement of 1971 was both important and symbolic; it was a practical negotiated solution of a chronic dispute that, on at least three occasions in 20 years, had brought the world to the brink of war. The achievement of a stable political and military balance in Europe has always been a vital American interest, which we have pursued by resisting pressures where necessary and by negotiations when possible. In this spirit we are now engaged in broader negotiations dealing with mutual and balanced force reductions in central Europe and with an agreement regarding European security and cooperation.

These achievements of detente must be balanced against the record of the fourth level of U.S.-Soviet relations; the quest for stability in areas peripheral to the vital interests of the two so-called superpowers. Here the progress achieved in other fields of our relations has not been equalled. The expansion of Soviet military power and its extension around the world is a serious concern to us. The willingness of the Soviet Union to exploit strategic opportunities—even though some of these opportunities presented themselves more or less spontaneously and not as a result of Soviet

6

(L/C)

action—constitutes a heavy mortgage on detente. If detente turns into a formula for more selective exploitation of opportunities, the new trends in U.S.-Soviet relations will be in jeopardy. If our contention in peripheral areas persists, even more of it becomes exacerbated, the progress achieved in other areas of detente will ultimately be undermined. The United States is determined to maintain the hopeful new trends in United States-Soviet relations on the basis of realism and reciprocity. But it is equally determined to resist pressures or the exploitation of local conflict.

Our new relationship with the People's Republic of China is another priority in the design of American policy. Stability in Asia and the world requires our constructive relations with one-quarter of the human race. We remain committed to the goals of the Shanghai communique. President Ford will visit China later this year to reaffirm these interests and goals and work for the continuing improvement of our relations.

## The Developing World

The five-fold oil price increase decided upon in 1973 by OPEC [Organization of Petroleum Exporting Countries] dramatized another dimension of American foreign policy—our relations with the developing world. For years it has been apparent that Asia, Africa, and Latin America have become major participants in the international system and that a new range of issues was upon us—not those between East and West but between North and South. Ideological and economic differences have come to dominate international forums, such as the United Nations or the recent preparatory conference in Paris between oil consumers and producers.

The American people have supported the aspirations of developing countries since the post-war years of decolonization. Their economic development has been an objective of American policy for decades. Their genuine nonalignment and interdependence remain an American interest.

Without question the new nations will have our sympathy and our help as, shaped by their own histories, they seek their own future. Our policy is based on the conviction that our policies are essentially complementary and that our destinies are shaped by interdependence. At the same time all nations have a basic choice to make: They can pursue confrontation or they can pursue solutions; they can deal in rhetoric or they can deal with

reality. They cannot do both. A policy of confrontation will ultimately work to the disadvantage of the weaker. The United States, for its part, is prepared for cooperation in every area of common concern, on the basis of mutual benefit and of mutual respect. Therefore:

* On energy we will continue our efforts for solidarity among the consumers, and we look forward to an early, constructive dialogue with the producers.

* On the broader question of raw materials we understand the interest of the producers in equitable prices. We in turn seek reliable supplies. We are prepared to discuss these questions in appropriate forums.

* On the law of the sea we shall press for a successful outcome in the interest of security, prosperity, and peace.

* On food policy the United States will strive to eliminate the scourge of hunger from the world and to turn this effort into a model of cooperation for the other global issues of an interdependent world.

We shall soon make specific proposals in all these fields.

## The Domestic Dimension

We thus face a great opportunity. Only rarely in history does a people have the possibility to shape its international environment. We are at such a juncture. And the greatest obstacle-paradoxically—is not resistance abroad but division within our country.

Thirty years ago last week the greatest war ever fought by man came to a close in Europe. It took the lives of more than 16 million human beings, left millions more homeless and destitute, and virtually destroyed the institutional fabric of victor and vanquished alike. Had it not been for the farsighted involvement of the United States in the aftermath of that struggle, it is doubtful that democracy or prosperity would yet have returned to Western Europe. But we gave mightily of our substance in the hope that the generations to come would never again have to live through the agony and torment inflicted on the world in that struggle.

A later generation of Americans learned of the limits to what even we can accomplish; that not every struggle anywhere in the world is necessarily one in which the United States must

7

involve itself; that not every injustice man inflicts
upon his neighbor is something that America must
or can seek to remedy.

There are lessons to be learned from both
experiences. The question is whether we will learn
from both or take our most recent experience too
literally and, in the process, forget what the agony
of a generation ago taught us unmistakably.

We came out of World War II a united people,
secure in our belief that our cause was just, our
purposes benign. We have come out of Viet-Nam a
divided nation, full of distrust—and sometimes
even malice—for our fellow countrymen and lack-
ing confidence in the goodness of our design.

It is time—indeed it is more than time—for us
to put a stop to this self-doubt and self-
punishment.

It is time to remind ourselves that we still live
in the greatest nation on Earth; that nowhere has
any nation come so close to the ideals of liberty;
that others throughout the world still look to us
and depend upon us to lead them to a better, freer,
and more secure life.

It is a time to recognize that we cannot exist
apart from the world around us, no matter how
much we may wish it. A world imperiled by
nuclear weapons forbids it; the reality of an inter-
dependent world renders it self-destructive. We
cannot compensate for a cult of action for its own
sake by indulging in a cult of withdrawal for its
own sake. Withdrawal in any event will give us no
respite; it will be an invitation to new burdens.

So it is time that the Executive and Legislative Branches of the Government put an end to the divisiveness and distrust that has come to characterize their relationship.

We do not ask that the Congress rubberstamp
everything the Executive puts before it—the advice
and consent of the Congress is essential for any
sustained policy. We have started new procedures
of consultation and are prepared for new
approaches to obtain advice. And we recognize
that many difficulties have resulted from previous
excesses by the Executive Branch. Nevertheless a
delineation of responsibilities is now in the interest
of both branches. If the Congress moves from
supervision to implementation, if it goes from the
setting of guidelines to the insistence on tactics, if

the legislative process is turned into a series of pre-
scriptions of individual moves, our foreign policy
will eventually be deprived of consistency,
direction, strength, and flexibility.

The constitutional separation of powers is a
concept that has served us well for almost 200
years. But our Government can work and our
Nation can act only when each branch is prepared
to exercise restraint. Without this cooperation,
stagnation is inevitable. It is no exaggeration to say
that a possible paralysis of leadership in America is
the greatest fear today of all those who look to us
for international leadership around the world.

We can have no higher national priority than
to restore our unity. If we are mired in cynicism,
recrimination, and immobility we will add to the
doubts of our friends and to the temptations of
our adversaries to take chances with the peace of
the world.

In the months ahead we must demonstrate
that we still are confident of our purposes; that we
remain a strong, energetic, and united people; that
we continue to be dedicated to helping other
nations help themselves; that we remain faithful to
our treaty commitments; that we are concerned for
the future of the world because we know it will
determine our own future.

Let us never forget that by any measurement,
we have given more in the last 30 years than any
other nation in history. We have successfully re-
sisted serious threats to world order from those
who wished to change it in ways that would have
involved unacceptable consequences for demo-
cratic governments. We have provided more
economic assistance to others than any other coun-
try. We have contributed more food, educated
more people from other lands, and welcomed more
immigrants. We have done so not only out of a
generous spirit—though we should not apologize
for this trait—but above all because the American
people, after more than a century of isolation, had
learned that assistance to others is not a gift to be
given but a service to be rendered for international
stability and our own self-interest.

For our own sake and that of the rest of man-
kind let us now make sure that this lesson does not
have to be learned again. And in that case we will
usher in a period of progress and peace for which
future generations will be grateful.

The Secretary
of State

DEPARTMENT OF STATE
UNITED STATES OF AMERICA

[LC]

Speech

May 13, 1975

Kansas City, Mo.

## STRENGTHENING THE WORLD ECONOMIC STRUCTURE

*Secretary Henry A. Kissinger before the Kansas City International Relations Council.*

Yesterday [in St. Louis] I spoke of the political challenges facing us in foreign policy—that we have a vast agenda ahead of us, that the world is poised on the brink of a new era of achievement or one of chaos, that America's role will be vital.

Our challenges in the economic field are no less urgent and important. Today I will discuss the international economic system and set forth a comprehensive American approach to the major issues at hand.

The paramount necessity of our time is the preservation of peace. But history has shown that international political stability requires international economic stability. Order cannot survive if economic arrangements are constantly buffeted by crisis or if they fail to meet the aspirations of nations and peoples for progress.

The United States cannot be isolated—and never has been isolated—from the international economy. We export 23 percent of our farm output and 8 percent of our manufactures. We import far more raw materials than we export; oil from abroad is critical to our welfare. American enterprise overseas constitutes an economy the size of Japan's. America's prosperity could not continue in a chaotic world economy.

Conversely, what the United States does—or fails to do—has an enormous impact on the rest of the world. With one-third of the output of the non-Communist world, the American economy is still the great engine of world prosperity. Our technology, our food, our resources, our managerial genius and financial expertise, our experience of

leadership are unmatched. Without us there is no prospect of solution. When we are in recession, it spreads; without American expansion, the world economy tends to stagnate.

For 30 years the modern economic system created at the Bretton Woods conference in 1944 has served us well. Its basic goals—open, equitable, and expanding trade, the stability and orderly adjustment of currencies, coordination in combating inflation and recession—have largely been achieved. World growth has surpassed any prior period of history.

But the system is now under serious stress. It faces shortages and disputes over new issues such as energy, raw materials, and food. And many of its fundamental premises are challenged by the nations of the developing world.

Obvious crises are the easiest to meet; the deepest challenges to men are those that emerge imperceptibly, that derive from fundamental changes which, if not addressed, portend upheavals in the future. These contemporary challenges to the world economic structure must be overcome, or we face not only an end to the growth of the last 30 years but the shattering of the hopes of all of mankind for a better future. Our economic strength is unmistakable. But what is tested now is our vision and our will—and that of the other nations of the world.

## The Existing System

The international economic system has been built on these central elements:

* Open and expanding trade;

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* Free movement of investment capital and technology;

* Readily available supplies of raw materials; and

* Institutions and practices of international cooperation.

Within this framework, over the past quarter century, the industrialized countries have maintained an almost continuous record of economic growth. The developing countries have made unprecedented advances, though their progress has been uneven.

After the experience of the 1930's the postwar system was designed—with the United States playing a leading role—to separate economic issues from political conflict and to subject them as much as possible to agreed multilateral procedures. The rules were designed to restrain unilateral actions that could cause economic injury to others.

The world's economic growth within this framework has been simultaneously the cause and the result of growing interdependence among nations. Revolutions in communication and transportation have shrunk the planet. The global mobility of capital, management and technology, and materials has facilitated the growth of industry. World trade has encouraged specialization and the efficient division of labor, which in turn have stimulated further expansion. The recession and inflation of the last few years—which spread around the world—have reminded us that nations thrive or suffer together. No country—not even the United States—can solve its economic problems in isolation.

Consciousness of interdependence has been most successfully implemented among the industrialized countries. When the energy crisis first hit us the industrial countries agreed that they would not resort to unilateral, restrictive trade measures to make up the payments deficits caused by high oil prices. That pledge was respected and will be renewed this year. And last fall, as the recession worsened, the President held a series of conversations with German, Japanese, British, and French leaders to devise a coordinated strategy for economic recovery. These policies have begun to bear fruit. The advanced industrialized countries have understood the imperative of coordinating their economic policies.

As our economies now turn toward expansion we must ensure that our policies remain coordinat-

ed, particularly for the control of inflation with its economic costs and attendant social dangers.

Against this background of cohesion the industrial countries can act with renewed confidence across the entire range of political, economic, and security issues. The annual ministerial meeting later this month of the Organization for Economic Cooperation and Development [OECD] is therefore of great significance. This body—composed of the industrialized countries of North America, Europe, and Asia—will assess where we stand and discuss even closer coordination and joint actions in economic policies. Secretary [of the Treasury William E.] Simon and I will represent the United States.

## The Challenge From The Developing World

Global interdependence is a reality. There is no alternative to international collaboration if growth is to be sustained. But the world economic structure is under increasing challenge from many countries which believe that it does not fairly meet their needs.

The challenge finds its most acute and articulate expression in the program advanced in the name of the so-called Third World. This calls for a totally new economic order, founded on ideology and national self-interest. It is stimulated by resentments over past exploitation, and it is sustained by the view that the current system is loaded against the interests of the developing countries. One of the central proposals is that the prices of primary products should be set by international agreements at new high levels and then pegged to an index of world inflation. The objective, as with the oil price increases, is a massive redistribution of the world's wealth.

This challenge has many aspects. At one level it is an effort to make the availability of vital natural resources depend on political decision, particularly with respect to energy, but increasingly involving other materials as well. More fundamentally it is a result of the new dispersion of economic power among developed and developing countries that springs from the unprecedented global economic expansion of the last 30 years.

The United States is prepared to study these views attentively, but we are convinced that the present economic system has generally served the world well. We are prepared to consider realistic proposals, but we are convinced that poorer nations benefit most from an expanding world economy. History has proved the prosperity of

3

each nation requires expansion of global prosperity. This should be the focus of our efforts.

The United States is convinced that an international system overshadowed by the rivalry of nations or blocs will produce instability and confrontation. This will prove disastrous to every nation—but above all to the weakest and the poorest.

The United States therefore is committed to a cooperative approach. We recognize that an international order will be durable only if its members truly accept it. And while the participation of developing countries has increased, it is clear that the energy producers and the emerging nations in Latin America, Asia, and Africa have believed themselves to be outside the system. We have a duty to warn against, and to resist, confrontation. But we are prepared to strengthen and expand the international economic system.

A serious concern must be the needs of the poorest. They have been the most grievously affected by the food and energy crises of the past 2 years. Their fate affects us morally as well as materially. Their prosperity would contribute to ours. And their participation in the global economy is required so that all nations, and not only the richest, have a stake in the world which we are building.

Let me now turn to the three most urgent challenges on the economic agenda—energy, primary commodities, and food.

## Energy

It is in energy that the challenge to the economic system has been the most effective and has had the most severe impact.

For years the United States and other industrial countries built their prosperity on ever-increasing imports of inexpensive foreign oil. Now we see that both the price and availability of those supplies can be determined by decisions over which we have no influence. Our jobs, our output, our future prosperity are at risk.

In response, at United States initiative, 18 major industrial countries created the International Energy Agency [IEA] to coordinate our efforts in a common strategy.

Our first responsibility was to protect ourselves against emergencies. We have to be prepared to deter the use of oil or petrodollars as political weapons or to defend ourselves if we are given no choice. To this end we and our partners have developed a comprehensive plan to build up oil stocks,

coordinate conservation measures, and share available supplies in the event of a new embargo. We have also agreed on a $25 billion "financial safety net" to protect against the stresses of large oil deficits and possible financial manipulation.

The second objective of the strategy is to bring pressure on the oil price through the market. If we act decisively to reduce the consumption of imported oil and develop alternative sources, we will sharply reduce demand. The producers can restrict production to maintain high prices and allocate the cuts among them, but at some point the severe decrease in demand will become a burden on those countries who seek maximum revenue for development.

Accordingly we and our partners first set joint conservation goals. We then reached preliminary agreement on a plan to stimulate alternative sources. The plan calls for cooperation in research and development and a common minimum price mechanism to protect domestic alternative energy sources from competition from imported oil. The ministers of the International Energy Agency meet later this month to accelerate the common effort. We shall propose ways to exploit our greatest asset—our technological capability and skill, particularly in the development of alternative energy sources.

In the end the key to the international effort will be what America does. We use fully half of the industrial world's energy. If we bring our consumption under control, so will other industrial countries. Indeed other countries are already ahead of us in adopting new taxes and other programs to curb energy use. But if we do not act now, while recession is holding down demand for oil, our vulnerability will grow again when our recovery gains momentum.

The choice is clear: Either we pass now an effective program of energy conservation and energy development or we become dependent on foreign sources for half our oil within a few years and correspondingly vulnerable to political pressures or manipulation.

The Congress has before it President Ford's energy program. Its decision is therefore critical to our future well-being and that of the international community.

Ultimately producers and consumers of energy must develop a new and balanced relationship. A first attempt at dialogue at the preparatory meeting called by [French] President Giscard

4

d'Estaing in April did not succeed.

The United States wants to say now that it is prepared to attend a new preparatory meeting. We believe that the meeting should be prepared through bilateral contacts between the consumers and producers. The United States will initiate such contacts with its partners in the IEA, with the Government of France, and with the producers. Our own thinking on the issue of raw materials, and the manner in which it can be addressed internationally, has moved forward. We can thus resume the dialogue in a new atmosphere. Let me now turn to the issue of raw materials.

## Commodities

The threat to our national security from a disruption in supplies of most raw materials is limited. We depend on imported raw materials for only 15 percent of our total needs; only 3 percent of our raw materials are imported from developing countries.

But we do have a concern for a flourishing world economy. In raw materials interdependence is as real as in energy. There exist common interests in a reliable and flourishing trade on mutually beneficial terms. It is in our interest, because the growth of the industrial nations will increasingly depend on raw material imports and because our growth depends on a healthy world economy. It is in the interest of developing countries, because their exports are often the principal source of development financing. It is in the interest of the world community, because the poorer countries can gain a sense of responsibility and participation only from the sense that their concerns are taken seriously.

The United States is aware of the dependence of many countries on their earnings from a single commodity. It is legitimate and reasonable that they should seek a reliable, long-term stable source of earned income for their development.

However, we do not believe that tying commodity prices to a world index of inflation is the best solution.

First, price indexing would strengthen those least in need of help because most raw materials production still takes place in the industrial countries, and price indexing would harm those most in need of help because the poorest, most populous states are net importers of raw materials. Finally,

such a scheme would introduce artificial rigidities which is likely to result in misallocation of resources and scarce capital and underutilization of needed productive capacity in many parts of the world.

We are prepared to discuss these issues in a cooperative spirit. We understand that development of many mineral resources is becoming increasingly dependent on heavy capital investment. The efficient development of lower-grade ores now depends on sophisticated technology and very large-scale operations. We recognize that excessive swings in commodity markets entail heavy, perhaps growing, costs. In periods of slack demand substantial excess capacity often appears. In periods of tight demand skyrocketing prices force costly adjustments in manufacturing processes and pricing. We realize that the role of private capital, which traditionally has been responsible for development of most overseas minerals, is being increasingly challenged on political grounds. To deal with these issues the United States will adopt the following approach.

* First, since both producers and consumers want a more reliable basis to do business, we will propose that the Multilateral Trade Negotiations now under way in Geneva develop new rules and procedures on such questions as freer access to supplies and markets, promotion of mining and processing industries, and settlement of disputes.

* Secondly, we are prepared to discuss new arrangements in individual commodities on a case-by-case basis as circumstances warrant.

* Thirdly, we will propose that the World Bank [International Bank for Reconstruction and Development] explore new ways of financing raw material investment in producing countries. We are particularly interested in exploring new ways of mobilizing capital and bringing it together with outside management and skills.

It is clear that both producers and consumers have much to gain from the settlement of the disputes over raw materials.

It is also clear that these issues are becoming of fundamental importance to the world's economic—and political—future. They have been brought to the center stage of world diplomacy. They represent an area of potential division. But

5

they also contain the possibility of a new and
challenging area of international cooperation.

An important first step will be to consider our
approach together with other industrial countries.
Other industrialized countries, the United
Kingdom in particular, have advanced a number of
proposals to this end. Raw material policy will be a
primary focus of the upcoming OECD ministerial,
and we expect the OECD to undertake a major
study of the issue.

The United States is prepared to deal with the
raw materials question with economic realism,
political imagination, and understanding for the
concerns of the developing world.

Food

Let me turn now to another issue on which
international action has already begun—and must
now be accelerated. This is the problem of food.

Last November the World Food Conference
was convened in Rome at American initiative. On
behalf of President Ford I announced a proposal
for a long-term international effort to eliminate the
scourge of hunger. For we regard our good fortune
and strength in the field of food as a global trust.
We recognize the responsibilities we bear by virtue
of our extraordinary productivity, our advanced
technology, and our tradition of assistance. And
we are convinced that the global response will have
an important influence on the nature of the world
that our children inherit.

The Rome conference reached basic agree-
ment on a comprehensive program in basic areas-
expanding the food production of the major
producers, accelerating production in the develop-
ing countries, improving the means of food
distribution and financing, enhancing the nutri-
tional quality of food production, and developing a
system of reserves to ensure against food emergen-
cies. A framework for international cooperation
was established.

Fortunately good crops this year will ease
food supply problems. But we cannot let this lull
us into complacency about the longer term. We
cannot escape the reality that the world's total re-
quirements for food are growing dramatically, not
easing. The current gap between what developing
countries produce themselves and what they need
is about 25 million tons; at present rates of growth,
the gap is expected to double or triple 10 years

from now. There is no escape from the world's
duty to deal with the problem of hunger with
urgency.

To maintain the momentum begun at Rome
action is needed now in three areas.

* First, for the short term, until a major expansion of world production is brought about, food aid will continue to be vital. The United States sees this as a responsibility not only of major food producers but of all financially capable nations. The United States has provided more than 4 million tons of food aid in all but one of the 20 years of our food aid program. We will do our utmost to maintain this standard of performance.

* Secondly, food aid can only be a stopgap measure. The long-term solution will require that food production be increased to its full potential. Food production in the developing countries can draw on a great deal of underutilized land resources. American assistance will henceforth place primary emphasis on research, fertilizers, better storage, transport, and pest control. We shall concentrate our aid capital in this sector of economic development.

* Third, we must meet emergency shortages
and protect world supplies in the face of crop fail-
ures and other catastrophes. To do so we have pro-
posed an international system of nationally held
grain reserves. We must start now to build them.

Let me discuss this issue of reserves more
fully.

Before 1972 the world had come to depend upon a few major producers—particularly the United States—to maintain the necessary grain reserves. Now after 3 years of shortages and emergencies, adequate reserves no longer exist. The United States has therefore removed all governmental restraints on production. Our farmers have gone all-out to maximize their output. The world must take advantage of better crops this year to reconstitute stocks. But this is not enough.

In meetings later this month the United States
will formally propose a comprehensive inter-
national system of reserves, based on the following
principles.

* Total world reserves must be large enough to meet potential shortfalls in food grains production.

* Grain exporters and importers should agree

6

on a fair allocation of reserve holdings taking into
account wealth, grain productive capacity, and
trade.

* There should be agreed international rules or guidelines to encourage members to build up reserves in times of good harvest.

* Each participating country should be free to determine how its reserves will be maintained and what incentives to provide for their buildup, holding, and draw-downs.

* Rules or guidelines should be agreed in advance for the draw-down of reserves, triggered by shortfalls in world production. There must be a clear presumption that all members would make reserves available when needed and, conversely, that reserves would not be released prematurely or excessively and thus unnecessarily depress market prices.

* In times of shortage the system must assure access to supplies for countries that participate in it, and there must be special provision to meet the needs of the poorest developing countries.

* Finally the system must encourage expanded and liberalized trade in grains.

The United States is prepared to hold an important part of an agreed level of world reserves. If others join us in negotiating such a system, the outline of international reserves agreement can be completed before the end of the year.

## Conclusion

These are the problems of the economic structure. They represent, in their scope and implications, a basic challenge to the economic system of the past generation and a basic test of the world's political future. They have become one of the central concerns of our diplomacy.

The present international economic system

has served the world well. Future prosperity in this United States and throughout the globe depends on its continued good performance. We are prepared to engage in a constructive dialogue and to work cooperatively on the great economic issues. We cannot accept unrealistic proposals. But we must act to strengthen the system in areas where it does not function well.

These issues are not technical; they go to the heart of the problem of international order-whether the major industrial nations and the developing nations can resolve their problems cooperatively or whether we are headed for an era in which economic problems and political challenges are solved by tests of strength. Will the world face up to the imperative of interdependence? Or will it be engulfed in contests of nations or blocs?

The role which the United States takes will be crucial. Will we fulfill our responsibility of leadership? If we know our own interest we will.

For the United States still represents the single greatest concentration of economic wealth and power to be found on the planet. But what is asked of us now most of all is not our resources but our vision and will.

The American people have always believed in a world of cooperation rather than force, of negotiation rather than confrontation, and of fulfillment of the aspirations of peoples for progress and justice. Such a world will never come about without our active contribution. The opportunities open to us are immense, if we have the courage and faith to seize them.

We have a stake in the world's success. It will be our own success. If we respond to the challenge with the vision and determination that the world has come to expect from America, our children will look back upon this period as the beginning of America's greatest triumphs.

The Secretary
of State

Press Conference

MAJOR TOPIC: Mayaguez Rescue

SECRETARY KISSINGER: I thought that in view of the events of this week and prior to my going to Europe, we might meet here. I don't have any statement.

Q: Mr. Secretary, there have been public complaints from Thailand about our landing of Marines. Was there a violation of Thai sovereignty in this caper? And secondly, can you tell us if there was any concern in the strafing of Cambodian gunboats that since we weren't too sure where our own men were, that we might—the crew was—that we might have hit the American crew?

A: Well first of all, of course, I have to reject the description of what happened this week as a "caper." It was a serious situation in which we were trying to save a group of Americans and recover a ship.

With respect to Thailand we have, of course, a treaty relationship with Thailand in SEATO [Southeast Asia Treaty Organization]. And we have had a series of base arrangements with them which, over the period of years, had led to a degree of cooperation in events in Indochina which were in the mutual interest and in which we have greatly appreciated the assistance that Thailand has given us.

In the course of this decade, it may be that a pattern of action has developed that made us assume that our latitude in using these bases was greater than the current situation in Southeast Asia would permit to the Thai Government. And therefore, insofar as we have caused any embarrassment to the Thai Government, we regret those actions.

At the same time it is clear that any relationship between us and another country must be based on mutual interest. And we, I believe, have a reason—or have a right—to expect that those coun-

tries that have an alliance relationship with us look with some sympathy at matters that concern the United States profoundly.

If conditions in the area change, we are prepared to adjust our relationship to new conditions and to have discussions on that subject in a spirit of cooperation.

Q: Mr. Secretary, that was kind of a double-barreled question.

A: What was the second question?

Q: Since we were not so certain—

A: Oh, on the gunboats. One of the most difficult and anguishing decisions we had to make was the risk to Americans in taking these gunboats under attack.

Now we had to balance this, in our view, against the risk as we then saw it—of their being taken to the mainland—and we wanted to avoid a situation in which the United States might have to negotiate, over a very extended period of time, over a group of merchant seamen who had no connection whatever with any governmental activity.

There was one incident in which our pilots were told to determine, insofar as one can under those conditions, whether any Americans were likely to have been on the boat. There was one incident where a pilot, beginning to take a boat under attack, saw a group of individuals that looked to him as if they might have been Americans huddled on the boat, asked for instructions, and was told not to proceed with the attack. And that was one gunboat that reached Kompong Som. So we tried to take it into account, and fortunately it seems there was no injury to anybody.

Q: Mr. Secretary, in light of the Thai Prime Minister's [M.R. Khukrit Pramot] recall of his

May 16, 1975
Washington, D.C.

PR 265/55

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Ambassador [to the U.S. Anan Panyarachun] and his announcement of a complete review of all treaties and agreements between the two countries, could you give us your assessment of the diplomatic strains now developing? Also, have you had any communication as yet from the Thai Ambassador?

A: We have not had any formal communication from the Thai Ambassador. But I am assuming that the story is correct.

The Thai Government finds itself, in general, in a complicated position after the events of Indonesia, quite independent of this recent operation.

We had, prior to this recent operation, made it clear that we are prepared to discuss with the Thai Government its conception of its requirements, or of the necessary adjustment in the present period. We are still prepared to do this, and we recognize that the Thai Government is under some strains and under some public necessities. And they have to understand, however, that we, too, have our necessities.

Q: Mr. Secretary, was there at any time in this crisis, any chance to resolve it diplomatically?

A: There was no chance during this crisis to resolve it diplomatically. That is to say, we never received a communication-proposition-that would have enabled us to explore a diplomatic solution, and it was-when-by Wednesday evening we had not yet received any reply that the President ordered the military operations to begin.

Q: I would like to clear up one mystifying aspect of this: Why did the Chinese return the note 24 hours later? And did they indicate at the time that it had gotten through to the Cambodian authorities?

A: In this matter the Government of the People's Republic was not responsible for the content of the note. But I am assuming the Chinese Xerox machines can reproduce it within 24 hours.

Q: What was the significance of their returning it, Mr. Secretary?

A: Well, a degree of disassociation from the diplomatic process-a formal disassociation. I don't want to speculate on this, but I wouldn't be surprised.

Q: Mr. Secretary, in view of the attempts at detente with the People's Republic of China, are you dissatisfied with their apparent-or with the way they handled themselves in this situation?

A: The requirements of relationships with some of our potential adversaries have to be seen in a more complicated framework than is often stated.

Both the Chinese and we have certain common interests which have been laid down in

the Shanghai communique, which we have re-affirmed, and which we consider remain valid.

At the same time we do have different perceptions in different areas, and there we will maintain our differences.

Thirdly, one has to keep in mind, in asking other countries to play a role, what their real possibilities are in any given situation.

And finally, one has to leave it to those countries to play their role, either publicly or privately-if they choose to-that they consider appropriate. So on the whole, I don't believe that this is a useful area for me to comment on.

Q: Mr. Secretary, in view of the earlier incidents involving a Panamanian freighter being detained and a South Korean freighter being fired upon, why was there no effort by this Government, earlier on-before the MAYAGUEZ seizure-to warn U.S. vessels to stay out of that area?

A: Well, my understanding is that insurance companies had been notified and that it had been assumed that they would get in touch with these ships. So we were, frankly, not aware that there were any American ships in that area. And when the matter came to our attention-this was not a matter that had ever reached high levels of the Government. It had been dealt with routinely by notification of the insurance companies, which are presumed to have the greatest interest in the preservation of these ships.

Q: I would like to go back to the Thailand question. Why was it, given the known sensitivities of the Thais to this situation in that area, that an effort was not made to at least consult with their Government prior to the sending of the Marines?

A: Well, the assumption was that we were in an emergency situation in which, on occasion, we have acted without having had a full opportunity for consultation, and it was therefore thought that within the traditional relationship it would be a measure that would be understood. In any event, it would have presented massive problems either way.

Q: Mr. Secretary, one of the effects of this incident appears to be a restoration of American credibility and, to some extent, morale. My question is: To what extent was that a consideration in the American operation?

A: The thrust of our discussions concerned the recovery of the ship and the rescue of the men. If there were any byproducts-that can be considered a bonus to the operation, but it was not the principal impetus behind the operation.

We believed that we had to draw a line against illegal actions and, secondly, against situations

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where the United States might be forced into a humiliating discussion about the ransom of innocent merchant seamen.

If it had these byproducts—I think to some extent it did have this effect. But this was not the primary motivation behind the action.

**Q:** Mr. Secretary, the Cambodian Minister of Information and Propaganda [Hou Min] has charged that our planes began systematically strafing and bombing the ship about 12 hours after it was seized—the area around the ship, Can you respond to that, please? This would be dawn on the morning of the 13th.

**A:** I would have to review the actual events. I don't have the log right here.

My recollection would be that it may have started somewhat later, but in any event, the decision was made. It was probably later than 12 hours afterward, but I don't want to tie myself to the time.

A decision was made to try to prevent ships from the mainland from reaching the ship—or ships from the island from reaching the mainland. That, I think probably happened sometime during our night on Monday night. So the timing could be roughly correct, but there must be some Defense Department statement of when the actual strafing started which would be correct.

**Q:** I just wondered how long we waited for the diplomacy to work before force was used.

**A:** The methods that were used were not strafing at first. The methods that were used were to try to force ships back to the island.

**Q:** Mr. Secretary, the only basic criticism that has been directed at the Administration's actions this week is that perhaps the Administration moved much too quickly militarily and did not give diplomacy a chance to work.

**A:** Come on, Marvin [Kalb, CBS News]—break down. Maybe we did something right. [Laughter] Statistically we are bound to do it sometimes. [Laughter]

**Q:** Well, in that spirit, could you tell us, or respond to that kind of criticism?

**A:** Well, when you say diplomacy was given no chance to work—if any communication had been received back, either from Cambodia or from any other source, then we would have had a subject matter for diplomacy on which to act. On the other hand, when this did not happen and when we had received no communication whatsoever, we had to balance the risks that would occur if they tried to move the ship. Since we didn't know whether any of the crew was left on the ship or

whether a Cambodian crew might have been put on the ship, we had to balance the risks if they tried to move the ship; the pressures we were under in neighboring countries; the difficulties that could arise. We therefore decided, after some 60 hours of diplomatic efforts, to try to seize the ship.

It was a balance that had to be struck. We thought the risks of waiting another 24 to 48 hours in the absence of any communication whatsoever from any government were greater than the risks of going ahead.

**Q:** When the Cambodians did say that they would release the ship, why was it, as I understand it, that the bulk of the military action followed the Phnom Penh radio broadcast that they would release the ship?

**A:** The Phnom Penh radio broadcast was received in Washington—it was received in the White House at about 8:16 that evening. At that time we had 150 Marines pinned down on the island, and we had the HOLT approaching the ship. At that point, to stop all operations on the basis of a radio broadcast that had not been confirmed, whose precise text we did not at that moment have—all we had was a one-page summary of what it said—a broadcast, moreover, that did not say anything about the crew and referred only to the ship, it seemed to us it was too dangerous for the troops that had already been landed to stop the operation. We therefore took rather drastic measures—drastic communications measures—of informing the Cambodian Government of the fact that we would stop all military operations as soon as the crew was released. And in order to make doubly sure, we released the statement that we had broadcast into Cambodia. We also released that statement to the press—it was verbatim, the same statement—on the theory that perhaps they would read the news tickers faster than they could pick up the other means of communication that we were using.

About 2½ hours after that the crew was released. And after that we stopped all military operations except those which we judged necessary for the saving of Americans that were still on the island.

**Q:** Mr. Secretary, on that point, questions have been raised in Congress this morning as to whether there was a punitive intent by the United States; and secondly, in relation to that, wasn't there also a hazard that the bombing of the mainland could have hit the crewmen, because there were at least two circumstances where the crewmen could have been hit by American fire—while they were on the ship and while they were on the mainland?

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A: Well, when you say "punitive intent"—the intent of the operation was as I described it: To rescue the men and to recover the ship. Obviously any damage that is done in the process has a punitive effect, whatever the intention is. We tried to gear the action as closely to the objective as was possible.

Now, as it turned out, there seems to have been some relationship between the release of the crew and the attacks on the mainland. That is to say, some members of the crew were told that they should tell the WILSON—or the officers on the WILSON—that they were being released on the assumption that this would end the bombing attacks. And when we received this word, around midnight—I mean this additional word, shortly after midnight—then all actions except those that were judged to be immediately necessary for the military operations were stopped.

There was some risk. It was clear that either the attack on the island or the attack on the mainland could lead to American casualties if the Cambodians deliberately moved the prisoners into an area where they would be exposed to attack.

On the other hand, we tried to confine our attack to clearly military objectives so that there would have had to be a very provocative intent on the part of the Cambodians. But it was one of the balances that had to be struck.

Q: Mr. Secretary, when you referred to 60 hours of diplomacy, actually I am told there was fighting which ran through this whole sequence—that there was fighting the night of the 12th, there was some shooting at American vessels the night of the 12th. The Cambodians say that we began strafing at dawn on the 13th. So there was, by both sides' accounts—even though they don't match—there seemed to have been a considerable amount of shooting all during the period when the diplomacy was being attempted. Could we have a better breakdown on that, possibly?

A: For about 60 hours we made no attempt to seize the ship. We made it very clear from the very beginning—the President in his statement, the communications that were sent to whoever we thought might have a possibility of reaching the Cambodians, and in a number of statements that I made on Monday and Tuesday—we made it absolutely clear that we insisted on the release of the ship and the men.

Then we took collateral actions to make it more difficult for them to move the men and to speed up the pace of their deliberations.

Q: Are you satisfied, Mr. Secretary, that the American message reached the Cambodians? And if you are satisfied, what gives you that—

A: Well, I am positive that our message reached the Cambodians because we delivered it to the Cambodian Embassy in Peking, in addition to everything else.

Q: A technical question for a moment. In response to one before, did you say there was no full consultation with Thailand or no consultation with Thailand?

A: Well, after the troops got into—

Q: Before.

A: Before, there was no consultation.

Q: At all?

A: No.

Q: Mr. Secretary, in Palm Springs you said the United States would face a time of testing, what with events in Indochina. Now, granted that was a private conversation, but much of that conversation has since gone public anyway. I would like to ask you if you think this was indeed a time of international testing of the U.S. resolve; and also what useful purpose was served—that is what has the world learned from the U.S. action regarding the MAYAGUEZ?

A: I have said not only in private conversations, I have stated publicly that events in Indonesia would have international consequences. And that they would affect other countries' perception of their position and of our own. I have also said that I believe those consequences were manageable if we were prepared to face them.

Now, this event could well have resulted from an isolated act of a local commander. I am not inclined to believe that this was a carefully planned operation on the part of the Cambodian authorities. Nevertheless, the impact on us was the same—and could have been the same as if it had been carefully planned—if we had been drawn through irresolution into a negotiation over a period of months over the release of people that they had no right to seize to begin with.

What the impact of this may be internationally—I don't want to transform it into an apocalyptic event. The impact ought to be to make clear that there are limits beyond which the United States cannot be pushed and that the United States is prepared to defend those interests and that it can get public support and congressional support for those actions. But we are not going around looking for opportunities to prove our manhood.

We will judge actions in the light of our interests and the extent of the provocation.

Q: Mr. Secretary, do you have any reason to anticipate a severance of relations with the United States by Thailand, or that Thailand may move up the date by which we must remove our troops in that country, which I think is 1 year?

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A: I do not personally anticipate a severance of relations with Thailand. I believe that relations with other countries must always be based on a mutuality of interest. We are doing other countries no favor when we have a well-considered alliance relationship, because it must be in the mutual interest. Other countries are doing us no favor by having diplomatic relations with us if it doesn't serve their interests. And, therefore, I am assuming that the Thai Government will look at its long-term interests as we will. We are prepared to discuss all issues with the Thai Government in a spirit of appreciation for what Thailand has done over several decades and with a cooperative attitude.

But, as I said the other day, we will not insist on arrangements that other countries no longer consider in their interests.

Q: Mr. Secretary, you spoke earlier about certain public necessities in Thailand. Are you implying to us that possibly the Thai Government is more interested in continuing a long-term relationship with the United States than some of its public statements might now suggest?

A: Well, I don't want to speculate about the interests of the Thai Government. There is this reality—that sooner or later the private views and the public views of a government must be brought into relationship with each other. And we can, over a long period of time, only act on those things that a government is able or willing to avow publicly.

I repeat: We are prepared to discuss in a spirit of friendship and cooperation all the concerns that the Thai Government has, and we do regret any embarrassment we may have caused them.

Q: May I just follow up on that, Mr. Secretary? When you say that the public and private views must be brought into balance, that suggests again that there is a discrepancy between the public and private views.

A: I don't know. I was trying to respond to your question in which you said maybe there was a discrepancy. And I would say that, even granting there was a discrepancy, then they would have to be brought into balance.

Q: Is there a discrepancy?

A: I don't want to speculate on that.

Q: Well, I mean without speculation, Mr. Secretary, in their private views, were the Thais as forceful as they have been publicly over the past few days?

A: I just don't want to comment on private views that individuals in the Thai Government might have. We take the Thai Government by its word, and we are acting on the basis of the official communications we've received.

Q: Are we witnessing in Thailand, Mr. Secretary, an example of the domino theory at work—

A: Yes.

Q: —a theory which you said was not invalid not so long ago?

A: I think we are seeing an effect of the domino theory at work. But it is almost self-evident that any major international event has consequences. The issue isn't whether there's a domino effect but what we can do about the domino effect, or whether we should do anything about the domino effect.

It is clear that a country that was peripherally involved in events in Indochina, but in a rather heavy way, must reassess its position in the light of Indochina events. So in that sense both Laos and Thailand indicate a certain domino effect.

Q: Mr. Secretary, would you clarify for us the American communications with the Cambodians? Did we specify a deadline as to a specific time when we wanted the ship and the prisoners to be returned? And could you clarify why the Marines landed on an island where obviously the prisoners were not being held? How does that whole sequence work there?

A: We did not give a time limit. We were considering at various times whether we should give a time limit. Every time we considered it we came to the conclusion that the risk of giving it to any military operation that might be contemplated and to the crew members were greater than the benefits to be achieved by giving a specific time limit, since most of those benefits were really domestic, so that we could say that we had given warning.

So by constantly increasing the severity of our requests we tried to convey an increasing sense of urgency, and, therefore, we approached the Secretary General [of the United Nations]. First of all, a number of public statements were made. Secondly, we approached—on Wednesday—the Secretary General of the United Nations with a letter, which was made public, indicating very clearly that we were going to invoke Article 51 of the United Nations Charter—the right of self defense of the United Nations Charter. And, therefore, we felt we had, in effect, given an ultimatum, without giving a specific time.

We had, in fact, drafted something with a specific time as an alternative, but we felt the risks were too great.

Now, with respect to landing on an island on which the prisoners were not. Almost anything we did would in retrospect be subject to this sort of question. We did not know whether the prisoners were on the ship, whether the prisoners were on the island, or whether the prisoners were on the

6

mainland. We tried to design an operation where we would, as close to simultaneously as possible, bring maximum pressure on the authorities in each place, so that if they were on the mainland there was some reason for the mainland authorities to release them, that if they were on the island we could seize them, and if they were on the ship that would, of course, have been the happiest event of all.

We genuinely thought-or at least we suspected-that a number of them might have been brought to the mainland. We thought that a substantial number of them would probably be on the island. Had we not thought this, there was no reason to land on the island. As it turned out the results achieved tend to justify what was attempted. There's no question that if it hadn't worked many of your questions would now be asked in a different atmosphere.

Q: Mr. Secretary, could one reasonably infer from several of your comments this morning that the United States would look with very great sympathy should the Thais decide to reconsider their involvement with SEATO and indeed conclude that it's in their best interests to withdraw from SEATO?

A: These are decisions which the Thai Government must make. We are in an existing relationship with the Thai Government. We have no reason on our side to change it. It is up to the Thai Government to decide what its interests require. And we will discuss the Thai concerns with the interest and sympathy that an old friend deserves. We are not suggesting to the Thai Government what position it should take.

Q: Mr. Secretary, let's get to something that might appear to be an inconsistency. I think you said that for 60 hours you waited before taking military action. Later on you said that we had to drive our point home with increasing severity. Did you mean that from the very beginning of this operation there was American military action taken to support existing diplomatic action?

A: No. What I meant by increasing severity-meant increasing severity of public statements. I did not mean increasing severity of military action. The military actions that were taken on Tuesday our time were exclusively designed at that point to freeze the status quo as much as possible to keep them from moving the ship and keep them from moving the crewmen. They were not designed as such to bring diplomatic pressure, although they obviously had that result.

Q: Could I ask a question about the disen-

gagement from the operation once the objective of releasing the men had been accomplished? Did some of the heaviest attacks actually occur after the men had been released?

A: I would have to check that. Some attacks occurred after the men had been released. At that point our biggest problem was that we had several hundred Marines on the island who were under very heavy attack. There were also 2,400 Communist forces on the mainland, and we wanted to absorb their energies in other things than attempting to intervene with our disengagement efforts on the island. That was the general concept of the operation.

Q: What are the latest figures on American casualties?

A: I think the Defense Department is putting them together and will release them today, or it may have done it already.

Q: Two other Asian matters. One, the PRG [Provisional Revolutionary Government] has been very insistent in trying to get the United States to accept, I gather, their sovereignty by turning over the Saigon Embassy to the Algerian Government. And secondly, do you have any personal comment on the revelation today that a major oil company gave $4 million to the ruling party in South Korea?

A: Well, on the first, we are studying that question, and we have not yet reached a conclusion.

With respect to the second problem, we oppose illegal actions of American corporations abroad. This action, to the best of our understanding, is not illegal by American law, but it is a matter that we would hope that American companies would take-the propriety of which American companies would take into account-if they should be tempted in the future to engage in political activities abroad.

Q: Dr. Kissinger, Gulf Oil has testified that it was forced to make $4 million in payments to stay in business in Korea. What is our attitude toward Governments which practice this kind of extorction? And why should we continue to give foreign aid to Governments which conduct this kind of thing?

A: Let me separate two things. One, if this is true-which I am not in a personal position to confirm-then we would regret such an action by a foreign Government toward an American company.

Secondly, what I said about Thailand applies-or what I said about our general attitude toward alliances applies, too. When we have a

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security relationship with a country, it is based not primarily on approbation of the governmental structure; it must be based on our belief that there is a mutual interest that both countries have in that security. If that mutual interest does not exist, then the arrangement cannot withstand any significant strain.

We believe that the defense of Korea and the security of Korea is important for the security of the whole northeast Pacific, and it is very important for our-northeast Asia-and it is extremely important for our relationship with Japan, and that is the primary reason we have.

Q: Mr. Secretary, to follow that up, if I may, just for a moment. Isn't there a lesson to be learned from what happened to this Government in Indochina where, for security reasons, we allowed ourselves to become involved with Governments which we might not approve of in terms of our own perception of what a government should be? And are we not in danger now of getting into exactly the same kind of situation in South Korea?

A: It is also a lesson to be learned from the consequences of the collapse in Indochina in terms of international affairs.

I would not make this analogy. The history of our involvement in Indochina was quite different from the history of our involvement in Korea. And to answer this question in detail, I would have to go into a long analysis of the similarities and differences which we can reserve, I think, for another occasion.

Q: Have you had a chance yet to reassess the decision to supply Jordan with Hawk missiles in light of the reports that Syria has promised to supply Jordan with air cover in an exchange for a Jordanian pledge-commitment-to participate in the next war with Israel? And also in light of the reports that there are suspicious Jordanian troop movements along the Jordan River?

A: We have seen no confirmation of either of these reports. And it is, of course, precisely to enable Jordan not to have to participate in defense arrangements with other neighbors that we agreed to continue the discussions on air defense which go back for nearly a year.

Q: Mr. Secretary, would it be in the interests of the United States now to have a diplomatic presence in Saigon?

A: The whole question of our attitude toward the new authorities in Saigon is now being studied.

Q: Mr. Secretary, in your St. Louis speech [May 12] you cautioned the Soviet Union against trying to exploit what they may perceive as Ameri-

ca's weakness, warning that this might put a heavy mortgage on detente. Have the Soviets toughened their position on either CSCE [Conference on Security and Cooperation in Europe] or on the SALT [Strategic Arms Limitation Talks] negotiations?

A: I did not use the words "American weakness" in my remarks. I want to point out that I said there are four areas that are involved in detente in which three were making reasonable progress. And the fourth-that is, conflict in peripheral areas-was less satisfactory. I think both of these must be stressed and not just the part that was less satisfactory.

Secondly, we do not find that the Soviet Union has toughened its position at the European Security Conference.

With respect to SALT, we are at the exploratory technical phase, and it is now at a point where a political decision will have to be made by both sides to move the negotiations forward and to break some of the deadlocks.

Q: Mr. Secretary, you spoke about the diplomatic results of the Cambodian operation as a bonus. Are you glad this happened?

A: Nobody can be glad to be put into a position where the lives of Americans are at stake. And the anguish of these operations for those who have the responsibility is very grave, because the consequences of failure are very serious, and the loss of life is never one that is easy to contemplate. We would far have preferred if this had not happened.

Our problem was that we could not choose our involvement. We were forced into this. And then when the incident had occurred, we had to act on the basis of what we thought would most save lives and was most in the interests of the United States. But we were not looking for an opportunity.

Q: Mr. Secretary, the last raid on the airfield near Sihanoukville was made a half an hour after the crew members were released, after the Cambodians had met the requirements for cessation of hostilities that the President laid down in his last public statement-that is, the ship was taken and the prisoners were released. Why was this raid not stopped?

A: Because we had some 200 Marines on the island. And we were trying to extricate them, and we were trying to keep the military forces on the mainland from interfering with what could have been an extremely tricky and difficult operation.

THE PRESS: Thank you, Mr. Secretary.

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Q Your former colleague, Stanley Hoffman, has the idea that we're entering onto an increasingly unmanageable world. Now, to the extent that he is right, and leaving aside your own possible shortcomings, what effect has that had on the conduct of American foreign policy?

SECRETARY KISSINGER: Well, I think Stanlty has a point; looked at as an outsider, the world is getting more and more difficult to manage. On the other hand, when you are in a position of responsibility you must attempt to manage it. That is the responsibility of the Secretary of State and of the President. So I would say things have become more difficult for a variety of reasons -- changes all over the world, changes in this country. I think they must be managed, and I think we will succeed in managing them.

Q Now, you have taken on an awful lot of this on your own shoulders, and, indeed, have been criticized for trying to do too much yourself. What about that?

SECRETARY KISSINGER: I think that there is something in it but less than is generally felt. For example, one of the efforts that I have made in the

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I am a rather forceful personality, but I look for strong personalities to work with me, because only that way can I be sure that I hear different points of view. I don't think it is the responsibility of somebody in a top job simply to register a consensus. I do try to shape it. I think foreign policy, however, must reflect the views and the interests of a country and cannot be personal in the ultimate sense.

RETAKE

Q In retrospect and looking at the untidy end of Viet-Nam, do you feel that the negotiations that ended were dragged on too long?

SECRETARY KISSINGER: When one looks at foreign policy in retrospect, one usually forgets the real choices that were available.

When we came into office, we found 550,000 troops engaged in combat. We had to disengage them. We had to bring about the return of our prisoners, and we wanted to preserve those South Vietnamese who had been our allies and whom we had supported for ten years.

We achieved the first two objectives.

We did not quite succeed in the third objective because after the Agreement was made, partly as a result of the domestic situation in this country, partly as a result of the inability of the Saigon Government to elicit sufficient domestic support, the disintegration came very rapidly.

But even under those conditions, it was a better -- than if the situation in South Viet-Nam had disintegrated while tens of thousands of Americans were still in the country and would have had to be evacuated under extremely complex circumstances.

Q Well now domestically in the United States --
I suppose you mean Watergate. Now --

SECRETARY KISSINGER: Watergate, and the resultant
decline of executive authority, vis-a-vis the Congress.

Q How much did Watergate hurt you in your
personal reputation and in your custodianship of American
policy?

SECRETARY KISSINGER: I don't think Watergate
has hurt me personally, in my reputation.

In the custodianship of foreign policy, Watergate

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was a tragedy, because at the beginning of 1973, we had our
foreign policy in a position where I foresaw a period of great
creativity.

The result of Watergate was that from "building"
we had to shift essentially to "maintaining" and you
cannot --. as I said during this period -- you cannot
conduct the foreign policy of a great country while its
central authority is constantly under attack.

Q Your most -- latest, and most strenuous efforts
to get another step in the Middle East broke down.
Do you now think that your original approach was the
right one? And is it really Israeli intransigence
which caused this -- or which side was at fault?

SECRETARY KISSINGER: Basic approach we have
pursued since the end of the Arab-Israeli War, was in my
judgement, the correct one and major elements of it can
still be continued.

We attempted to enable the parties to deal with

individual problems one at a time -- and we sought to
diffuse the situation in which there was an oil embargo,
economic recession in Western Europe and Japan as a
result of the conditions in the Middle East -- and the danger
of a military confrontation with the Soviet Union.

As a result, for two years we have managed to
keep the area relatively calm, and we are in a position
where further steps are possible.

As for the past, I don't see any point in trying
to assess blame.

I have said publicly, that both parties negotiated
in good faith, and we would like to put our energies now
in moving things forward -- and I believe possibilities
for forward movement exist -- all the more so as a
stalemate has consequences that nobody can accept -- that
this government would not accept.

Q Thank you.

Q Well, Mr. Secretary, now that that is over and we are entering a new phase in the world, perhaps, less manageable, it has been suggested in many quarters that perhaps in the reassessment of policy, someone else rather than you should be doing it -- a new mind, a new personality -- what do you think of that?

SECRETARY KISSINGER: I think one should never personalize foreign policy; and in a democracy, nobody is indispensable.

On the other hand, one has to weigh that general argument against the fact that we have had resignations in senior officers in each of the last two years -- so that one should not lightly resign from one of the most responsible offices in our Government.

So I have concluded that as long as the President
has asked me to stay -- as long as it's my impression that
an effective foreign policy is still being conducted --
I see no need to resign, or I think it is in fact, not
in the national interest, under these conditions.

Q. Personally, wouldn't you like a rest, though?

SECRETARY KISSINGER: Personally -- there is
nothing for me, personally, in staying in a job that I have
conducted for several years. But I have to ask now:
What would help the Country and what would help the
objectives -- and I have to take my lead in this respect
from the President.

Q. Do you feel that the foreign policy of the
United States is now set on such a course that it will be
able to maintain the continuity of direction which has
characterized it for so long?

SECRETARY KISSINGER: I believe that the main
lines of American foreign policy are set.

I believe also, that the main lines of our
foreign policy are essentially bipartisan, and have been
conducted by administrations of both major parties since
the war.

10

11

I have, really, no higher objective than to help
bring about a foreign policy that will be continued by
others, because if our foreign policy changes every few
years, we will become a destabilizing influence in the
world.

And therefore, I'm making major efforts and
always have made major efforts, to conduct it on a non-
partisan basis, and to consult as widely as I can.

Q Thank you very much, Mr. Secretary.

Arrival Statement
Berlin Tegel Airport
10:30 a.m. May 21, 1975

Mr. Governing Mayor, Ladies and Gentlemen:

Thank you for your kind welcome. I am happy to
have a chance to renew my acquaintance with this great
city.

As you know, I am stopping here in the course of a
series of meetings and consultations with our friends and
Allies in Europe. I have just come from another pro-
fitable round of conversations with Chancellor Schmidt and
Foreign Minister Genscher on a number of subjects,
including Berlin. In coming days I will be getting
together with the CENTO Allies and will attend
Ministerial meetings of the OECD and IEA, before going
to Brussels for the NATO summit.

I think it especially appropriate that my visit
to Berlin fall during this concentrated round of Western
consultations. It underlines the fact that has always
been uppermost in the mind of my government-- this city
and its people are an integral part of the Western world
in the most fundamental sense. You and we form part
of Western society. There can be no question where
Berlin belongs; our destinies are identical and cannot
be separated.

- 2 -

We in the West are faced with a number of challenging problems in the period ahead. Development of detente-- where Berlin continues to play a special role-- is among the most major of these issues. But the other matters-- such as energy, economic stability and the challenges of the Third World-- are as vital to the interests of Berlin as to any other member of our Western community. I hope to touch on some of these matters in my discussions here today. As a center of learning and research, Berlin has much to contribute to the search for ways of dealing with the challenges of the modern world. Your example was inspiring to us all during the period of East-West confrontation. I am confident that you will continue to be in the forefront in mastering the challenges of detente and in searching for solutions to the new economic and technological problems now facing the West.

PRESS
DEPARTMENT OF STATE

May 21, 1975

No. 276

As Prepared for Delivery

ADDRESS BY
THE HONORABLE HENRY A. KISSINGER
SECRETARY OF STATE
BEFORE THE
BERLIN HOUSE OF REPRESENTATIVES

May 21, 1975

I

Mr. Governing Mayor, Mr. Foreign Minister, Ladies and Gentlemen:

It is an honor to be in this city whose fortitude has preserved the peace and whose devotion has inspired all who love freedom.

The people of West Berlin know better than anyone what freedom means.

They know — and have proven — that peace requires security as well as conciliation, courage as well as hope.

They have experienced that freedom can be preserved only by those who have faith in themselves and in the dignity of man.

I do not come to Berlin to lecture to you on the requirements of peace and freedom in the modern world. It is we who have learned, and you who have taught.

- You have endured and prevailed during the darkest days of confrontation between East and West.

- You have experienced in the cruel division of your own city the consequences of ideological hostility.

- You survived and prospered because the solidarity of the Western allies has buttressed your security and the security of Western Europe.

- And now, in a new era of eased confrontation in Europe, the fate of Berlin will determine the future of the efforts to insure security through negotiation and cooperation. As Berlin was the greatest symbol of the heroism of the immediate post-war period, it is also the acid test of the period we now hope to enter.

Throughout the post-war era, the United States has stood shoulder to shoulder with this city, in times of crisis and in times of hope. The strength of our commitment thus derives not from formal documents alone, but above all from our perception of our own objective interest and of a generation of shared experiences.

PR #276

-2-

The security of West Berlin remains a vital interest of the United
States. For us, much more is at stake here than the security of a
city. To us you symbolize man's unquenchable yearning for freedom:
you represent the capacity of democracy to summon the strength to
defend its values. This is the cement of our tie with you, our
sympathy for you, and our admiration for you.

II

My visit does not come in the midst of crisis; rather it takes place
at a moment when this city is enjoying greater security than at any
time in the last thirty years. But we shall not slacken our resolve
or neglect our security, for we know that it has been our determina-
tion and our strength which have made the present opportunity for
progress possible. By working to make restraint and negotiation the
only realistic option, we have created conditions for a more rational,
hopeful and reliable relationship with the East.

In the thermonuclear age, there is no alternative to peace. In the
general interest — most of all of those whose homes would be the
focal point of crisis — we seek just and reasonable solutions to
outstanding issues. But America will never seek peace by abandoning
principles or sacrificing friends.

In the delicate balance of relations between East and West, Berlin's
position is pivotal. Throughout the period of detente the United
States and its Western allies have shared the conviction that the
hope of wider security and cooperation in Europe had to be vindicated
in Berlin above all. We agreed that efforts to normalize relations
in Central Europe had to begin with normalizing West Berlin's existence
in safety and dignity. Therefore, we pressed for reliable, practical
improvements in the conditions of access to Berlin and in life in this
city; we made a major effort to remove Berlin as an issue is East-West
confrontation. We consider the effectiveness, durability, and
scrupulous observance of the Quadripartite Agreement on Berlin of
September 1971 a crucial test of the process called detente.

Given the complex history of the issue, we cannot expect the Quadripartite
Agreement to work every day without flaw. But no one, East or West,
can deny the practical benefits which have accrued to both sides from
the Agreement and the arrangements which followed.

Before 1972, traffic on the vital access routes between Berlin and
the Federal Republic was vulnerable to harassment on a variety of
pretexts. The relationship between Bonn and West Berlin was subject
to continuing dispute. And cruelly and tragically, the human
connections between the people of West Berlin and their friends and
families in the surrounding area were being stifled by Eastern controls.

Today by contrast:

- Vital surface access routes are guaranteed in an international
agreement; unimpeded and preferential civilian traffic is
enshrined in formally agreed procedures.

PR #276

-3-

- Communications between West Berlin and East Berlin, between West Berlin and the German Democratic Republic have been improved. Direct telephone links now exist. Visits to the East now number in the millions annually, nearly 300,000 during the recent Easter holiday alone.

- The Western allies' rights and responsibilities to safeguard the status of the Western sectors of Berlin have been specifically reaffirmed.

- The Soviet Union has formally accepted that the ties between West Berlin and the Federal Republic "will be maintained and developed." It has agreed that Berlin's interests abroad be represented by the Federal Republic, and that the Federal Republic provide consular protection and representation for Berlin in international organizations. Berlin is also included in the increasingly important web of agreements governing intra-German ties.

While these legal guarantees are not necessarily self-implementing, they represent a significant achievement. We shall never relax our efforts to ensure the strict implementation of the Quadripartite Agreement. We shall deal with challenges with the same determination to resist pressures and with the same spirit of readiness to negotiate that produced the Agreement. Thus only if Berlin flourishes will detente flourish; only if you are secure will Europe be secure. This has been America's attitude for thirty years; it has not changed. On behalf of President Ford and the American people I reaffirm our historic relationship today.

III

Mr. Governing Mayor, Mr. Foreign Minister, distinguished ladies and gentlemen. In this House resides the democratic tradition that gave Berlin the moral strength and resiliency to withstand the hardest trials of the last thirty years. And you embody the democratic ideals which represent Berlin's future.

The tradition of this House began in 1946 with an election which, tragically, remains the only free vote held in all sectors of Berlin since the war. In 1975 you mark the 25th anniversary of the Berlin Constitution which has provided the framework for your growth and progress in freedom.

In the world today, democratic principles are under grave challenge on many continents. Over the next decade we will learn whether, in the face of economic stresses, military peril, and political change, free men have the will and imagination to vindicate the values they believe in. For these values, however vital, do not defend themselves nor do they grow without dedicated effort.

All great achievements were an ideal before they became a reality. What the free societies need above all is the confidence that they can shape their own future. Our material strength is undisputed and unmatched; what is required now is to summon our reserves of faith and dedication. The Atlantic nations have shown in countless endeavors in thirty years the tremendous strength of the free association of free peoples.

PR #276

-4-

At moments of difficulty, it is well to remind ourselves of what we have achieved — the reality of security and progress to which men and nations have aspired throughout history. The preservation of these achievements, and the world's hope for wider sharing, depend crucially on what we do together.

I have come to Berlin to tell you that America remains committed to the building of a just and peaceful, secure and free world. We know our moral compass. We shall be true to the belief in freedom, progress and human dignity which reflects America's best hopes.

This is why this city means so much to us. For thirty years you have symbolized our challenges; but for thirty years also you have recalled us to our duty. You have been an inspiration to all free men.

As we face a new era, with challenges more subtle and complex, Berlin will continue to be a symbol of freedom. We shall stand with you and we are confident that history will record Berlin not merely as a great city, but as a great principle in the story of man's struggle for freedom.

* * * * * *

Informal Remarks To Members of US Mission, Berlin
Following Honors Ceremony, May 21, 1975

Ambassador Hillenbrand, General Walker, members of the staff of the Mission, ladies and gentlemen:

Thank you very much for your warm welcome to Mrs. Kissinger and me. We are pleased to be here today, and appreciate your thoughtfulness in having come here to greet us.

It seems that every time I hear discussions about this Mission I am reminded that it is "Unique" among our foreign service posts. Perhaps this could be said of other Missions as well, but I cannot think of anywhere else that the US Government -- State Department and US Military alike -- has quite the role to play as it does here in Berlin.

I really need not tell you in any detail about the important responsibilities you have to West Berlin and the special relationship you have with West Berliners. But I do think it worth recalling for you that in no other post do Foreign Service Officers and the US Military share as closely with the local government the responsibility for insuring the freedom and viability of a city and its people as you do here. Your work requires a special sensitive awareness of the situation, and a

-2-

special dedication to the goals and aspirations which
we share jointly with Berliners. You must be constantly
alert to problems and potential dangers and be prepared
to respond to them with appropriate speed and decisiveness.
In short your duties require a light touch, yet in
a moment of challenge, firmness, and even toughness.

For years the members of this Mission, military and
civilian alike, have played an important role in our
foreign policy, not only in terms of Europe, but world wide,
because Berlin issues have been Central to the relationships
which developed between East and West following World
War II. During the period of confrontation when this
Mission stood together with West Berlin on the front
line, the excellent reporting and analysis which came
from here contributed significantly to the development
of our policies in the '50's and '60's. It is equally
important that this tradition continue into the '70's.

With the entering into effect of the Quadripartite
Agreement we have begun a new process in Berlin. In
an era of détente, when we seek to lessen tensions
between ourselves and old advisory, we will require
the same type of concise reporting, and careful analysis
of developments in Berlin for which this Mission is famous.
I am sure that I can count on you to meet the challenge.

-3-

To all the members of the Mission, German and American alike, I would like to say "Congratulations and thanks" for the outstanding job you have done.

May I encourage you to continue to work to maintain the high standards which you have established for yourselves and which we both expect and need from you.

PRESS
DEPARTMENT OF STATE

[LC]

May 22, 1975

NO. 286

ADDRESS BY
THE HONORABLE HENRY A. KISSINGER
SECRETARY OF STATE
TO THE AMERICAN COMMUNITY
AT THE UNITED STATES MISSION

BERLIN

May 21, 1975

General Walker, Ladies and Gentlemen:

I would like to tell you first of all how proud I am to be here in Berlin, a city which has been a focal point of American postwar efforts, a city in which Americans have every reason to be proud of their fortitude and of their association with the brave people who have stood for freedom throughout the postwar period. In America, in recent months, we have gone through some difficulties and there are many, or at least there are some, who have questioned the role of America in the postwar period. I think that all of those who doubt what America has stood for should visit Berlin.

We remain committed to a strong foreign policy. We remain committed to defending our principles and our values, and we do not forget that the peace of the world has been preserved through American efforts and American cooperation with our allies and we intend to maintain this.

You here in this city have had a very special role to play throughout the postwar period. The freedom of Berlin has become a test case of American commitments and of American purposes.

We are now in a period in which we are negotiating with the Soviet Union and with other countries of the Communist world. We sincerely attempt to ease tensions. Any responsible leader has an obligation to avoid the dangers of war, and no group has a greater interest in this than the military personnel that will have to bear the brunt of a conflict, or people in a city such as this that would be exposed to changes in international climate. But never in this effort to relax tension will we give up our principles, and never will we sacrifice the values or the interests of our allies.

In this somewhat more complex world that exists, more complex than the early postwar period, we will not forget the city of Berlin and the Americans here in their dedication, their reporting, play a very special role. I want you to know how honored I felt by the ceremony I was privileged to participate in, want you to know how much it means to me to come to this city, where the basic issues do not require so much explanation and where all of you are performing a great task for your country, for the free peoples and indeed for the peace of the whole world.

* * * *

Departure Statement
Berlin Tegel Airport
3:00 p.m. May 21, 1975

I thank the governing Mayor and the people of Berlin
for the warm hospitality and friendship you have shown to
Mrs. Kissinger and me here today. This has been a most
rewarding visit. I have seen a city with a sense of purpose
and a firm idea of how it will meet the future. I have seen
a traditional center of industry and culture, of education
and research and, above all, of dedicated human spirit.

Being with you today has heightened my pride in the
role my country has been able to play in Berlin over the
past thirty years. I am heartened by the improvements made
possible by the Quadripartite Agreement. The spirit with which
Berlin and the Berliners are determined to make their city a
showcase of democracy is an inspiration to us all. I leave
Berlin with no doubt that this city will continue to thrive as
a place where freedom is firmly rooted and where the cause of
international understanding can flourish.

For me, this visit has also provided a chance to renew
old friendships and to see once again a great city and its
people which I have cherished for many years. I am happy to
say that you have never looked better. As I leave, I can
enthusiastically endorse that familiar saying: Berlin is
truly "eine Reise wert."

[L.C.]

PRESS
DEPARTMENT OF STATE

May 22, 1975

No. 289

STATEMENT BY
THE HONORABLE HENRY A. KISSINGER
SECRETARY OF STATE
AT OPENING SESSION OF THE
TWENTY-SECOND SESSION OF THE
COUNCIL OF MINISTERS OF CENTO
ANKARA
MAY 22, 1975

I

Mr. Secretary General, Prime Minister, Your Excellencies, Distinguished
Guests, Delegates, Ladies and Gentlemen:

I am privileged to be here for the first time representing my country at
the 22nd meeting of foreign ministers of the nations of the Central
Treaty Organization.

I would like to take this opportunity to thank the Prime Minister and the
Foreign Minister of Turkey for the characteristically warm reception we
have received and for the excellent arrangements they have made.

We meet at a timely moment when the United States is determined to re-
affirm its ties to its allies. We meet at a moment when this region --
at the crossroads of Europe, the Mediterranean, the Persian Gulf, the
Middle East and South Asia -- has taken on an ever greater strategic,
economic and global importance. We live in an era of rapid economic
change and political turbulence. There have been disturbing tensions in
the Eastern Mediterranean. The Middle East stands poised on the brink
either of new upheaval or of a hopeful process of movement towards peace.
This region reflects, therefore, all the problems and hopes of a new era
of international affairs. If our nations can thrive and maintain our
collaboration, we will achieve much for ourselves, and we will contribute
even more for the resolution of issues far wider in their impact and
implications. We will demonstrate to our peoples -- and set an example
for all peoples -- that even in an era of change, men remain the masters
of their own future. President Ford has repeated before the Congress that
"we will stand by our friends, we will honor our commitments, and we will
uphold our country's principles." The American people have learned,
through experience that is irreversible, that our fate is closely linked
with the rest of the world. The world faces a new agenda -- of economic
progress; of relations between consumers and producers, of relations
between developed and developing countries; of issues such as the law
of the sea -- in which the United States is in a unique position to make
a vital contribution and determined to do so. And, at this moment, after
some months of trial, the American people are perhaps more conscious than
in the recent past of the need to reaffirm our steadfastness, of our
dedication toward international peace, progress and security.

PR # 289

-2-

Central to our foreign policy is the close relationship with our allies in NATO, of which Turkey is such an important member, and in Japan, and with our friends in other treaty relationships. Our relationships are based on considerations beyond security. Next week the Foreign Ministers of the International Energy Agency and the OECD will meet in Paris to underline the importance of economic cooperation and economic progress. At the end of the week President Ford will meet with his colleagues at a summit in Brussels to emphasize America's ties to its friends.

## II

In today's world our associations aim at peace and not confrontation. We seek to engage the communist powers in constructive relations on the basis of our continued strength and security, individual and collective. But as we strive for peace we shall never give up our principles or abandon our friends.

In recent years the United States has attempted to build a more durable and constructive relationship with the Soviet Union, as my colleagues here have similarly done. We have taken historic steps of strategic arms limitation, of bilateral cooperation in various fields, and of resolution of differences in such areas as Berlin -- which I visited yesterday. At the same time we are determined that in areas where our interests are not parallel to the Soviet Union's, there must be a practice of reciprocal restraint and responsibility. We have always insisted and we shall continue to insist that the easing of tensions cannot occur selectively.

The United States, as you know, has also taken historic steps in recent years to end decades of estrangement with the People's Republic of China. This new relationship has served the cause of peace not only in Asia but globally. The development and improvement of this relationship is one of the priorities of American policy.

All the members of this Organization have been similarly outward-looking in their policies. We all have important relationships which have strengthened each of us and thus served a common interest.

## III

Within this region, we face a new era of challenges more complex than those when this Organization was created.

-- Pakistan's economic progress since its trials of three and a half years ago has been extraordinary. The United States takes pride in having been associated with this endeavor.

Prime Minister Bhutto had a highly productive visit to Washington. The territorial integrity of Pakistan remains a principal interest of the United States. At the time the United States strongly supports the promising process of accommodation on the subcontinent which was begun at Simla.

PR #289

-3-

-- The rapidity of Iran's modernization is one of the most impressive demonstrations of national dedication in the world today. The recent Washington visit of His Imperial Majesty was the occasion for deepening American-Iranian friendship and for increasing the already close economic cooperation. Iran's role for peace and stability in the region is vital. We welcome the improvement in its relations with its neighbors, including Iraq.

-- The United States regards Turkey as a valued friend and ally. We will make every effort for further progress in restoring our normal defense relationship with Turkey. The United States strongly supports efforts aimed at ending the disputes between Turkey and Greece, for we consider their relationship important to the security of both countries, to the security of the Mediterranean, and to the security of Europe. We also will continue to do our utmost in the Cyprus dispute to encourage a just and durable solution that promotes the welfare of the people on the island, and maintains the sovereignty territorial integrity and independence of Cyprus.

-- The Arab-Israeli conflict remains a dangerous problem for the entire world. The two disengagement agreements established a momentum toward peace that the United States is committed to sustain. The challenge to diplomacy in the Middle East is to achieve agreement among the parties that will assure the territorial integrity, security, and right to national existence of all the states of the region and that will be seen to take into account the legitimate interests of all its peoples. Since the suspension of negotiations in March, we have reviewed the various approaches of assisting the parties to continue their progress. Our reassessment is still under way. But we are convinced that the present stalemate must not be allowed to continue. The United States has every intention of remaining actively involved; we shall promote practical progress toward a just and durable peace pursuant to Security Council Resolutions 242 and 338. Our challenges -- as previous speakers have pointed out -- are not confined to the political field. Indeed, in an era of interdependence, peace must be built on many pillars.

-- Energy is an area of increasing importance to all of us. This Organization embraces countries which are consumers, others which are producers, and developing nations seriously affected by the recent crisis of shortage and increase in price. The well-being of all our countries is affected in different ways. My government believes that a fair solution can be found serving all our interests -- the consumers in a reliable supply at reasonable price, the producers in reliable long-term income for development, and the poorer nations' need for special consideration. This promise cannot be realized through tactics of confrontation or by taking advantage of temporarily favorable market conditions, such tactics will produce counter organization and by undermining the world economic structure will ultimately hurt producers as well as consumers. The United States will spare no effort to find a cooperative solution. The accomplishments of CENTO in the political, security, and, recently, economic fields are considerable. The cohesion of this Organization, now in its third decade of existence, is a remarkable testimony to the common interests and values of the nations comprising it.

PR #289

-4-

With the wise leadership of our distinguished new Secretary General, and with renewed determination that this alliance shall be a vehicle for close collaboration, in all fields, CENTO can make a fresh contribution to this region's security and economic progress. The President has asked me to underscore the continued commitment of my country to these fundamental aims. The United States is deeply conscious of our responsibility. We know that the future of the world depends very much on our contribution and perseverance. We will remain fully engaged because of our own self-interest, because of the responsibility our wealth and power confer upon us, and because only by standing by our friends can we be true to the values of freedom that have brought progress and hope to our people.

Thank you.

* * * * * * * * *

PRESS
DEPARTMENT OF STATE

[LC]

May 22, 1975

No. 290

RESPONSES BY
THE HONORABLE HENRY A. KISSINGER
SECRETARY OF STATE
TO QUESTIONS BY TED KOPPEL OF ABC-TV
FOLLOWING THE OPENING SESSION OF THE CENTO MINISTERIAL

ANKARA, TURKEY

MAY 22, 1975

**MR. KOPPEL:** (Question unclear, but concerns Syrian renewal of UNDOF)... did this surprise you and does it strengthen your hand?

**SECRETARY KISSINGER:** Well I am pleased by this result and I think it gets us some more time to see weather progress can be made.

**MR. KOPPEL:** Did you know this was going to happen?

**SECRETARY KISSINGER:** I did not know it through the whole period. I think Syria decided this in the last two weeks.

**MR. KOPPEL:** Why do you think the Syrians agreed to go ahead, in effect, of the Egyptians? The Egyptians have given only three months mandate. Now the Syrians mandate will go through until November.

**SECRETARY KISSINGER:** I do not want to speculate on Syrian motives, but I think it is a constructive development which we hope will give us an opportunity to work for progress in a calmer atmosphere.

**MR. KOPPEL:** Does it in any way strengthen your hand unilaterally or would it have to be still within the Geneva context?

**SECRETARY KISSINGER:** Well, we have always maintained the position that we will proceed on whatever course seems most promising, and we do not insist on any particular formula-whichever will work best. I intend to go to Geneva and we are prepared to use other means.

**MR. KOPPEL:** May I ask another question on a different subject? There were reports today that the United States is beginning to evacuate people as of tomorrow, out of Laos. Can you enlighten us on that?

**SECRETARY KISSINGER:** We have been reducing our personnel in Laos to make it conform more with the new political situation that has developed there, and in which, in the light of the harassment of our aid personnel, a reduction of at least Regional Offices is indicated. So there will be a be a very substantial reduction of our presence in Laos.

PR #290

-2-

**MR. KOPPEL:** Is this a complete evacuation?

**SECRETARY KISSINGER:** It is not a complete evacuation at this point.

**MR. KOPPEL:** Thank you very much.

* * * * *

[LC]

PRESS
DEPARTMENT OF STATE

May 24, 1975

No. 297

#56

PRESS CONFERENCE BY
THE HONORABLE HENRY A. KISSINGER
SECRETARY OF STATE

The White House

May 24, 1975

SECRETARY KISSINGER: Let me begin with the trip and deal with the European portion first, and then discuss briefly the meeting with President Sadat, and then we will follow the procedure that Ron outlined, and I will take questions on the trip and on the Sadat portion and then any general questions that you might want to raise.

The basic purpose of the trip was outlined by the President in his speech to the Congress in early April. It was to have an opportunity to exchange views with the other leaders of NATO, to assess the current state of the Alliance, to determine where the Alliance should go in the period ahead, and to use this opportunity as well to discuss a number of special problems that may have arisen.

With respect to the NATO summit, it is obvious that in the post-Indochina period, certain questions have arisen with respect to how the United States will react to accept that and what this means to its other Alliance relationships.

But apart from this special problem, there is also the fact that the President has not had an opportunity to discuss with his colleagues as a group the future of the Western Alliance and that the future of the Western Alliance requires consideration quite apart from whatever special problems may have arisen for the United States.

I would put these in perhaps three categories: The problems that are inseparable from modernizing the original concept of NATO; that is to say, how to bring the defense arrangements of the Western Alliance in line with current realities; the second is to discuss the new issues that have arisen as a result of changing circumstances and of different emphases that must be given as a result of these changing circumstances; and the third is to use this opportunity to discuss a number of special problems that exist together with the relationship with the East European countries and the Soviet Union; that is to say, the relationship between detente and security.

These will be the major issues that the President will address.

With respect to the military issues, they, of course, will have been discussed in some detail by Secretary Schlesinger, with his colleagues in the DPC, and there will be no need for the President to go into the technical details of all of these issues.

PR #297

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But the basic fact is that the Alliance was conceived in a period of American nuclear monopoly, and it has to be adapted to conditions of effective nuclear parity.

The Alliance was developed in a period when the nature of the military threat seemed relatively clear-cut, and it has to be adapted to circumstances when the military threat can take on many more complicated forms.

The Alliance was developed at a period of great American material preponderance, and it has to be adjusted to conditions more in keeping with the realities of the emerging European economic strength and, therefore, the balance that has to be achieved between the two sides of the Atlantic.

I repeat, those issues will have been discussed in specific terms by Secretary Schlesinger, but they will be discussed in their conceptual aspect by President Ford, together with his colleagues, because while security is not enough as a basis for the Western Alliance, without security there is no basis for the Western Alliance at all.

The second set of issues concerns the new problems that have arisen growing out of the interdependence of the world economy and the impossibility of founding cooperation entirely on military measures.

Two years ago, when this was put forward in the proposal for the Year of Europe, it led to rather intense debate. Today, the interrelationship between economic, political and security elements is a fact. In fact, two years ago, there were some who argued that the Western Alliance had no role except in the military field. Today, most of our allies insist on the proposition that the economic policies of the industrialized countries must be brought into some relationship with each other if there is to be any effective future.

It is no accident that the summit is occurring at the end of a week that begins with the meeting of the IEA, goes through a meeting of the OECD, and culminates in the summit.

The IEA — the International Energy Agency, which we consider one of the success stories of the recent period — links together most of the consuming nations into an organization designed to enable the consumers to take some control over their economic destiny by cooperative programs of conservation, alternative sources and financial solidarity.

This will be the first ministerial meeting since the Washington Energy Conference and it will take stock of the past and look into the future.

The OECD, comprising most of the industrial nations of the world, will address the problem of industrial growth and the relationship of the industrial nations to the less developed nations, so that the summit of the Western Alliance is coming at the end of a period in which the Defense Planning Committee has looked at the security side.

The other meetings have addressed the economic and energy aspects so that the leaders of the Western Alliance can look at the whole architecture of their relationship and develop a concept of security transcending the purely military aspect.

The third element that will be discussed at Brussels is the relationship between the Communist and the non-Communist world, or between the Western Alliance and the Communists.

PR #297

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As the Administration has repeatedly pointed out and as the President again emphasized yesterday, we consider the easing of tensions, where it can be honorably done, an essential goal of Western policy and we will make every effort to pursue the same.

We do not believe that the easing of tensions is an alternative to Alliance policy. We think that both of these elements of policy are integrally related to each other. Without the strength of the Alliance there would be no basis for detente that is based on equivalence.

But without demonstrating to our people that serious efforts are being made to improve international conditions that confrontation is not an end in itself, we will also not be able to maintain the strength that is needed for realistic detente.

There are before the West three major areas in which negotiations are at this moment going on: The negotiations on SALT, which concern the Alliance indirectly but which are being conduced primarily between the United States and the Soviet Union; the negotiation on the mutual, balanced force reductions, in which NATO is negotiating with the Warsaw Pact; and the negotiations on European security in which all European nations — NATO, Warsaw Pact, as well as the so-called neutrals — participate.

No doubt, the President will review with his colleagues in plenary sessions and in the bilateral meetings, the status of these negotiations and will discuss how they can best be promoted.

While in Brussels, the President will have a series of bilateral meetings; indeed, after the completion of the Brussels meetings, he will have had bilateral meetings within the month with every leader of the Western Alliance. You will have the schedule of those meetings and therefore I will not go through them.

It is obvious that particular attention will be paid to his meetings with the Greek and Turkish leaders. He will see Prime Minister Karamanlis and Prime Minister Demirel on Thursday morning.

As you know, the United States has played an active role, at the request of the parties, to be helpful in bringing about a solution of the Cyprus dispute as well as of the other issues that exist between Greece and Turkey.

It is a complex set of issues in which a long historic legacy profoundly complicates the solution and in which the domestic situation of the participants does not always facilitate progress, not to speak of our domestic situation.

Nevertheless, we believe that the two sides, both in the communal talks and in the talks that have now begun between the Greek and Turkish foreign ministers, are beginning to grope their way towards positions that may prove to be negotiable and insofar as we can make a contribution to this, we will do so. After all, our international involvement in the post-war period began with the Greek-Turkish aid program. We value our relations with both of these countries.

We believe that their tensions are a tragedy for the Western Alliance and in the long term a tragedy for the countries concerned and we will do our utmost to facilitate a solution. But we must also keep in mind that it is not the United States that can produce a solution. The solution must be produced by negotiations among the parties.

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We can help, we can use whatever influence we have, but we cannot substitute for the parties concerned. But the President will give a considerable amount of attention to that problem.

You know that he will meet with the British Prime Minister and with the German Chancellor. He will also meet with the Prime Minister of Portugal and there will be, as I pointed out, individual appointments with all of the leaders that he has not seen recently as a result of their visits to Washington.

Let me now turn to the visit to Spain. The United States believes that the relationship of Spain to Western Europe and to the Atlantic Alliance is in a sense an anomaly. Spain is one of the principal countries of Western Europe. Its security and its progress is closely linked to that of the rest of the continent and the United States has believed that a relationship ought to be established between Spain and NATO. For a variety of reasons, that has not proved possible.

Therefore, the President thought it desirable to visit Spain to discuss with the Spanish leaders their conception of the future evolution and the relationship of that to Western security and progress. We believe that through such conversations we can participate in what we will hope will be a beneficial evolution for all of the parties concerned.

The President, while in Western Europe, will also visit Italy, a country with which we have close ties and for which we have very special concerns, to exchange views with the leaders of Italy about their many complicated problems and to reaffirm a relationship to which we attach great importance.

Of course, he will see His Holiness, the Pope, for his first meeting with His Holiness, to discuss his general conceptions of how peace can be promoted in this period and the many humanitarian concerns of the Vatican.

Let me say a word about the meeting with President Sadat.

As we have repeatedly pointed out, as indeed we have not been permitted to forget, we are engaged in a reassessment of American policy in the Middle East. This is an effort that is not directed against any country or on behalf of any country.

It was made necessary by the suspension of shuttle diplomacy and of the last attempt to achieve an interim agreement between Israel and Egypt.

In the new circumstances that fact created, with a high probability of the Geneva Conference being reconvened, it has been imperative for the United States to assess its policy in the light of these new conditions.

This process is going on, and in this process, personal meetings between the President and various of the leaders of the area play an essential role.

We intend to discuss with President Sadat, as we shall do later with Prime Minister Rabin, our conception of the alternative routes toward peace as they present themselves to us.

We will be eager to hear President Sadat's view as to what he considers the most effective means of promoting peace in the Middle East.

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After we have completed these discussions, one of two things is likely to happen. Either it will appear that the view of the two parties about method and perhaps about substance is sufficiently close so that negotiations can be encouraged or it will appear that they are still so far apart that it may be necessary for the United States to suggest a procedure or a way to proceed.

In either event, the President has repeatedly stated that the United States believes that a stalemate in the Middle East cannot lead to anything other than a catastrophe for all of the parties concerned, and the United States is determined that diplomatic progress be resumed.

The principal purpose of the reassessment is to devise means and to explore approaches that might facilitate this progress.

This, then, is the basic purpose of the President's trip. It is part of a foreign policy which, whatever recent disappointments, is based on the proposition that a major American role is essential to maintain the peace and to promote progress in the world.

And the United States will play this role both in a general sense and in a particular sense in certain regions.

This is the attitude with which the President is undertaking this trip, and he is hopeful that it will contribute to the objectives that I have outlined here.

Now, if you agree, let us take the questions in the sequence that we suggested: first about the trip, the Western part of the trip, then about the Middle East part of the trip, and then any general questions that you might have.

**QUESTION:** Will the President find, Mr. Secretary, in Western Europe widespread doubts about US will and purpose in the world now as a result of the MAYAGUEZ and the things the President talked about yesterday?

**SECRETARY KISSINGER:** I wouldn't think that as a result of the MAYAGUEZ the President is going to find widespread --

**QUESTION:** No, I mean, will the doubts be dispelled or partly dispelled by that?

**SECRETARY KISSINGER:** I think that there are questions in many West European countries — not necessarily in all, but in many — about the impact on the United States of the events of recent months and about the significance for other areas of the way in which our involvement in Indo-China, and I think these questions exist whether they are formally articulated or not.

They can be removed to some extent by words, and to greater extent by actions, but in this atmosphere it is important for the President to have an opportunity to sketch out a direction in which we can move together.

MAYAGUEZ should not be overdramatized. It was important that the United States demonstrated that there was a point beyond which it could not be pushed, and it was a useful thing to have done. It will not of itself create the conditions that are necessary to deal with the situation that I have described.

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**QUESTION:** Mr. Kissinger, were you able to tell Foreign Minister Antunes last week that he could expect the NATO summit meetings to discuss, among other things, the conditions under which Portugal might have to be excluded from NATO, as the President alluded to yesterday, or were you as surprised as some of your colleagues in the State Department by the firmness of the President's remarks on that subject?

**SECRETARY KISSINGER:** I don't know about my colleagues in the State Department, but if they had been talking to me, which is not always guaranteed, then they could not have been surprised. I share the President's views on this matter, and what the President was pointing out was the anomaly of a Communist-dominated government being part of NATO. He was not saying that the Portuguese Government now is Communist dominated. In what way this particular issue will be discussed in Brussels remains to be seen.

I would expect that it will come up more naturally in bilateral talks between the President and his colleagues at a plenary session, and I might say that I have certainly expressed our concerns to the Portuguese Foreign Minister, and our views on this matter have not been kept secret from anybody.

**QUESTION:** A follow-up on that. Is he going to ask them to discuss conditions under which Portugal should be excluded from the Alliance?

**SECRETARY KISSINGER:** I doubt that this will be put formally before the Alliance. I think the President was pointing out a problem which will not go away simply by being ignored. He did not say that the problem had in fact already arisen.

He was speaking about trends. He, as you know, is meeting with the Portuguese Prime Minister and Foreign Minister and one other member of the Portuguese delegation.

We wish Portugal well. We hope that Portugal will have a democratic evolution in conformity with its own national aspirations, so we are not going to Brussels with the intention of producing a confrontation with Portugal or over Portugal, but we also believe that there are certain trends that will not disappear by being ignored or by assuming the most favorable possible outcome.

**QUESTION:** Mr. Secretary, are you implying that -- you talk about bilateral discussions, that there are certain things that could not be discussed with the Portuguese and, therefore, must be discussed with other countries, such as secrecy in NATO military matters and other matters which are too sensitive to be treated in public.

**SECRETARY KISSINGER:** I am not implying that, but it is a fact that an Alliance, which is designed to prevent a Communist attack on Western Europe, acquires unique features. If it includes in its deliberations a government of which many members are Communist, that is a fact — we are not creating this.

Whether this is the occasion to raise that issue formally I would question, but that it is an issue can also not be questioned, and what the President did yesterday was to call the attention of his colleagues to this problem.

It does not mean that it will be raised at the meeting in any explicit form.

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**QUESTION:** Mr. Secretary, if Portugal goes Communist in the literal sense, would you then recommend that it be removed from NATO?

**SECRETARY KISSINGER:** If Portugal goes Communist, then we have obviously a situation which was not foreseen when NATO was originally formed, and then to pretend that this is something that need not be considered is an absurdity.

What exactly will be done under those circumstances requires the most intense consultation with our European allies, but that it requires intense consultation goes without saying.

**QUESTION:** Mr. Secretary, at what point would you determine that this Government had gone Communist? There is a nebulous situation there, with several parties involved. What I would like to know is, at what point do you decide that this Government is Communist dominated?

**SECRETARY KISSINGER:** When we think it is Communist dominated (Laughter), and I think that there will be sufficient objective indications of that fact.

**QUESTION:** Mr. Secretary, can you say what was the response of the Prime Minister to your observation?

**SECRETARY KISSINGER:** I had a very friendly talk with him, and indeed, as we announced on that occasion, I invited him to visit the United States within the next three months, and he accepted.

**QUESTION:** But did he show a will of his Government to remain in NATO in any case?

**SECRETARY KISSINGER:** Yes, he indicated a desire to stay in NATO.

Can we talk about some other problem except for Portugal?

**QUESTION:** Mr. Secretary, in the broader European questions about the American commitment, did you find in your contacts and in your recent trips that there are doubts about the American President being able to push his foreign policy through the American Congress, and how are you planning to resolve those doubts when you go to Brussels?

**SECRETARY KISSINGER:** I have the impression that the relations between the Executive and the Legislative are of profound concern to many other countries. I found that on this trip; I found it at the OAS meeting previously here in Washington. I say this without assigning blame for this state of affairs. This is a fact.

Now, I believe that this relationship is in the process of improvement, and that many of the conditions that produced the tensions, such as Watergate and the war in Viet-Nam, now being behind us, the possibility for a much more creative cooperation exists.

This would certainly be our attitude. In any event, the President will make clear to his colleagues what the Executive conceives our proper responsibilities to be, and we believe -- and we certainly fervently hope -- that we can obtain the necessary Congressional support.

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**QUESTION:** By all accounts, the European allies are not very enthusiastic about bringing Spain into a closer relationship with NATO. Does the President have any new arguments, new pressures, or do you expect any change in his attitude?

**SECRETARY KISSINGER:** No, we have stated our view on the matter. I don't think that this will be an issue that we need to raise with additional intensity. We have made our view clear over the weeks, and we have made our view clear by the trip that the President is taking to Spain, and this may be a matter that will have to be left to time.

**QUESTION:** What is our Government's attitude towards a new security arrangement with Spain?

**SECRETARY KISSINGER:** We are in the process of negotiating this, of negotiating the extension of the basic agreement, and in the process of these negotiations that will be looked at.

**QUESTION:** Mr. Secretary, is the President going to see any members of the opposition in Madrid?

**SECRETARY KISSINGER:** The President's schedule is not yet finally settled, and we will announce it when it is.

**QUESTION:** Mr. Secretary, wholly apart from the stated intention of the U.S. reassessment of Middle East policy, isn't it true that it has now taken on a life of its own? I mean, isn't it true that it is being largely viewed, particularly by Israel, as a U.S. tool, a U.S. lever, a U.S. pressure device?

**SECRETARY KISSINGER:** Can I set this question aside for one moment? I will answer this as the first question on the Middle East part. Let me see if there are two or three more questions on the European part, and then I will take it.

**QUESTION:** Mr. Secretary, will the President confer with President Giscard, and what about France's role?

**SECRETARY KISSINGER:** President Giscard has agreed to come to the dinner for NATO heads of state, and heads of government that is being given by the King of the Belgians. In connection with the visit of President Giscard for that purpose the President will have a bilateral meeting with the French President, and we look forward to that.

**QUESTION:** Mr. Secretary, in the meeting of NATO in Brussels, could this not be the beginning of the end of NATO as we knew it before, a divergence of interests between the United States and Western Europe in coming years -- the social, political, economic order of things?

**SECRETARY KISSINGER:** I expect the opposite to happen. I expect that this meeting of NATO will stress some new dimensions for NATO and will usher in a period of new creativity.

Let me take one more question on the West European part, and then I will take your question, if I can still remember it. I will remember it.

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**QUESTION:** Mr. Secretary, I would like to question why it is necessary to reassure the NATO allies of the American commitment in view of the fact that that commitment to NATO has been solid since the end of World War II, laying aside Viet-Nam, which was not a formal treaty commitment?

Why is it necessary to reassure the NATO allies when it has been the British which have been cutting back on their troops, the French which pulled out of NATO, the Greeks which pulled out of NATO, and the Turks which want to throw the U.S. military bases out of Turkey?

**SECRETARY KISSINGER:** Not without provocation.

**QUESTION:** Well, that is debatable with the Congress, not me, sir.

I am wondering why we have to go hat in hand to reassure them.

**SECRETARY KISSINGER:** We are not going hat in hand to reassure them, and I did not say we are going to Europe to reassure NATO. If you read the record of what I said, I am sure you will find that I stated three major purposes, that the question of reassurance arose in response to queries that were put to me.

I stated that NATO is in need of adaptation to new circumstances in its original purposes, that NATO is in need of adaptation to new conditions that have arisen due to the interdependence of the modern economy, and that NATO is in need of a formal consideration of the relationship between its security objectives and the attempt to ease tensions with the East.

Those are the three principal purposes. If in the process reassurance results, that is fine, but quite apart from the issue of Indochina, the President's intention was, in any event, to have a meeting with the leaders of Western Europe.

Now, let me take the question --

**QUESTION:** Let me try it again, if you didn't get it the first time.

**SECRETARY KISSINGER:** No, I got the point. Let me see what I remember.

**QUESTION:** Do you expect to pursue the date for European Security Conference?

**QUESTION:** What was the question?

**SECRETARY KISSINGER:** The date for the European Security Conference does not depend on the United States. The date for the European Security Conference will be determined by the negotiations that are now going on in Geneva in which there are a number of issues still outstanding on confidence-building measures, on human contacts and on post-conference machinery.

In each of these, the West has put forward certain initiatives and is either awaiting the responses or analyzing responses that it has just received. The date of the Security conference cannot be settled independent of the progress of the negotiations and the best way to speed that conference would be if the Soviet Union considered carefully some of these considerations that we had put forward.

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Now, to the Middle East. The question, as I understood it, was whether reassessment has developed a life of its own and whether it is not conceived or intended as a pressure upon Israel.

Well, as I have said before, my friend, Abba Eban, used to say that Israel considers objectivity a hundred percent support of its position.

We did not intend this assessment either as pressure or as support for any party. It was made inevitable by the suspension of the negotiations and by the potential collapse of the interim approach. With Geneva becoming a probable outcome, it was imperative for the United States to consider procedures and substance all the more so as it is the view of the Administration, which we have certainly not kept secret for years, that progress towards peace in the Middle East is in the interest of the parties concerned, in the interest of the West and in the interest of the United States.

As such, it is not directed against any country. It is not intended as a pressure upon any country. It is as objective a look as we can get from our best conception of the American and world interest in this matter, of what is required to promote peace, and of course, the United States has been committed to the existence of Israel as part of such a just peace.

**QUESTION:** Mr. Secretary, as I understood you, you said the United States will be willing to put forward new proposals if neither of the principals came up with their own proposals for establishing progress.

**SECRETARY KISSINGER:** At least as to procedures.

**QUESTION:** Well, that was part of the question, actually. Do you mean to suggest that the United States will produce proposals in terms of its bilateral or multilateral relationships with the parties themselves or for Geneva, or in what context?

**SECRETARY KISSINGER:** That depends on which route is chosen. It will be impossible for the United States to be at Geneva without expressing some view on the subject at some time.

**QUESTION:** What are the chances of your renewing shuttle diplomacy, then?

**SECRETARY KISSINGER:** We cannot judge which method will be most appropriate until the President has had an opportunity to talk to some of the parties principally involved.

**QUESTION:** Mr. Secretary, will the letter from the Senators giving the broad base support for Israel have any effect on your dealings with President Sadat or Prime Minister Rabin?

**SECRETARY KISSINGER:** We will take seriously expressions from many quarters. At least some of the statements in that letter contain the ambiguities that have been at the heart of Middle East negotiations for many years and therefore, as we move more deeply into these negotiations, we will have to discuss with the Senate as precisely what meaning is to be given to phrases such as "secure and recognized frontiers," which are also part of Security Council Resolution 242.

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**QUESTION:** Mr. Secretary, why do you believe the Syrians moved to extend the UN mandate for six months, which puts them out of synchronization with the Egyptians, and what will the impact of that action be on the next three to six months?

**SECRETARY KISSINGER:** I will answer that question, but if we could leave non-Egyptian and Israeli questions out until I get through the second part of my answers. But, I will answer that question.

**QUESTION:** On the Egyptians?

**SECRETARY KISSINGER:** The impact is that it gives some more time for a development of peace initiatives less closely geared to imminent deadlines than seemed possible a few weeks ago and, therefore, we welcome this step.

Helen, did you have a question?

**QUESTION:** Yes, I did. On the question of overdramatizing MAYAGUEZ, don't you think that the Administration had a big part in that? Also, you were the one who said it was a bonus and benefits.

**SECRETARY KISSINGER:** That it was what?

**QUESTION:** A bonus and benefits.

**SECRETARY KISSINGER:** No, I said our purpose was to free the ship and the crew, and if there were any collateral benefits, that was a bonus, but not the primary purpose. That is a different thing from saying that that was the exclusive purpose.

**QUESTION:** Don't you think that it is being magnified into a major foreign policy representation?

**SECRETARY KISSINGER:** I believe that it was explained in response to very intense queries. I have stated our view, and what has happened previously. I don't want to --

**QUESTION:** Mr. Secretary, do you believe that the two super powers will inevitably impose a settlement on the sides in the Middle East if both sides will not come with new proposals?

**SECRETARY KISSINGER:** We have not thought it wise to impose a settlement, and our policy has been designed to enable the parties concerned to negotiate the structure of a just and lasting peace.

**QUESTION:** Mr. Secretary, does the President plan mainly to listen during the Sadat and Rabin meeting and, if so, what is your expectation for any new position, new concessions, being made by either man?

The reason I ask the question is that it suggests that the reassessment may hinge on the outcome of those talks.

**SECRETARY KISSINGER:** If I tell you that, maybe President Sadat won't come to the meeting.

I think we are in no position to give answers to final settlement until we have completed the assessment we are now making.

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**QUESTION:** Mr. Secretary, President Sadat has said publicly now several times that he intends to press President Ford for an answer to what the American position is on supporting Israel, either in the present situation or back to the 1967 borders. What will the President say to President Sadat, or what do you think about that question?

**SECRETARY KISSINGER:** If I tell you that, maybe President Sadat won't come to the meeting. (Laughter)

**QUESTION:** Since we have already had no assessment on Mr. Gromyko, can you tell us a little bit of what he indicated to you was the Soviet position on the Middle East?

**SECRETARY KISSINGER:** I think that the Soviet Union realizes that it is one thing to start a conference, it is another to bring it to a conclusion, and I think every party concerned so far has realized that it was less complicated to talk about Geneva than it bring it off.

Now that Geneva has become a very probable outcome, I think it behooves the two co-chairmen to discuss what steps they can take to bring about the best atmosphere for talks and the best possible outcome for such talks, and this is the spirit within which we had our preliminary exchanges.

As you know, Foreign Minister Gromyko and I plan to meet again in July, and I think at that time, after we have substantially completed our assessment, we will be in a position to be more specific.

**QUESTION:** Mr. Secretary, you say Geneva is a probable outcome, but as you also point out, it is a lot of trouble getting it off the ground. First, we thought it was going to meet early in the summer. Now it appears that it may not be until late in the summer, and the Egyptians are saying possibly not until the end of the year.

Do you have any estimate of when Geneva will be?

**SECRETARY KISSINGER:** I think I will be in a better position to answer that question in July, after I meet with Foreign Minister Gromyko, and after the President has met with President Sadat and with Prime Minister Rabin and after we have talked to some of the other interested Arab parties.

**QUESTION:** When you talk about Geneva, are you talking about it in the context we understood it when it first began, that this would be a negotiation or would it simply be a framework within which some variation of shuttle diplomacy might be able to work?

**SECRETARY KISSINGER:** I don't think I can add anything to the three possible options that the President outlined yesterday.

**MR. NESSEN:** Why not take just a couple more minutes, Mr. Secretary? You have been at it for about an hour.

**SECRETARY KISSINGER:** I haven't even gotten started yet. I will take two or three more questions.

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**QUESTION:** How would you define the main stumbling block to an interim settlement between Israel and Egypt? Is it the issue of nonbelligerency?

**SECRETARY KISSINGER:** The issue of the last interim negotiation has taken on the form of the Japanese movie, Rashomon -- there are so many versions of it around now that I don't want to add to the general confusion.

I don't think there is any purpose served by reviewing the last negotiation, which takes on more epic proportions the longer one hears the various accounts. The major problem now is to focus on the future. That requires some stocktaking as to what the parties now conceive to be the essence of the problem as they now see it.

Once we understand that, then we can make some suggestions as to whether or how the deadlock might be broken, rather than go over again the last positions they had at that time, which under the pressure of events may now look somewhat different.

**QUESTION:** Dr. Kissinger, you said that we have not thought it wise to impose a settlement. Do you have any reason to believe that we could impose a settlement that would be accepted unless it was acceptable to both sides?

**SECRETARY KISSINGER:** We believe that a settlement must emerge out of a process of negotiation between the two sides in some form, either directly or indirectly.

**QUESTION:** Mr. Secretary, in your meeting with Gromyko, was there any progress made on what appeared to be some differences on the Vladivostok SALT agreement or is that coming along, and do you expect to have something final this year, yet?

**SECRETARY KISSINGER:** The Vladivostok agreement settled most of the conceptual problems. It left open many of the technical issues in the implementation of the basic concepts. Being technical, these issues become extremely complicated. I believe that we are making progress in clarifying the issues and in narrowing the gap between the two sides.

I believe that the chances of completing the agreement this year are good, but it is a highly technical negotiation in which -- I don't want to disillusion you -- there is an enormous amount of consensus within our Government as to what is required, and we are moving in that direction now.

**QUESTION:** Mr. Secretary --

**SECRETARY KISSINGER:** I think, Bernie, you had a question.

**QUESTION:** The other Bernie.

**MR. NESSEN:** Bernie Kalb.

**SECRETARY KISSINGER:** Oh, Bernie Kalb. I didn't even see him.

**QUESTION:** Mr. Secretary, in this immediate post-Viet-Nam era, do you believe that the firmness of your reiterations to outstanding American

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commitments is matched by an equal firmness of the will of the American people to follow through on those commitments?

SECRETARY KISSINGER: Yes, I believe it is. I believe that the American people will support an American foreign policy designed to preserve global peace and to bring about conditions of progress which reduce international tensions and general tensions.

I think this is a question in part of the leadership of the Administration, which we intend to exercise, and I believe also that with the end of some of the divisive debates which this country has been subjected to in recent years we are in a better position to obtain public support and indeed, we have a very large degree of public support for the kind of foreign policy that we have outlined.

* * * * *

FOR IMMEDIATE RELEASE

MAY 24, 1975

OFFICE OF THE WHITE HOUSE PRESS SECRETARY

THE WHITE HOUSE

PRESS CONFERENCE
OF
HENRY A. KISSINGER
SECRETARY OF STATE

ROOM 450
OLD EXECUTIVE OFFICE BUILDING

2:08 P.M. EDT

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- 2. -

I would put these in perhaps three categories:
The problems that are inseparable from modernizing
the original concept of NATO; that is to say, how to
bring the defense arrangements of the Western Alliance
in line with current realities; the second is to discuss
the new issues that have arisen as a result of changing
circumstances and of different emphases that must be given
as a result of these changing circumstances: and the third
is to use this opportunity to discuss a number of special
problems that exist together with the relationship with
the East European countries and the Soviet Union; that is
to say, the relationship between detente and security.

The Alliance was developed in a period when
the nature of the military threat seemed relatively clear-
cut, and it has to be adapted to circumstances when the
military threat can take on many more complicated forms.

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The second set of issues concerns the new
problems that have arisen growing out of the inter depen-
dence of the world economy and the impossibility on
founding cooperation entirely on military measures.

The IEA -- the International Energy Agency,
which we consider one of the success stories of the
recent period -- links together most of the consuming
nations into an organization designed to enable the
consumers to take some control over their economic
destiny by cooperative programs of conservation,
alternative sources and financial solidarity.

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We do not believe that the easing of tensions is an alternative to Alliance policy. We think that both of these elements of policy are integrally related to each other. Without the strength of the Alliance there would be no basis for detente that is based on equivalence,

There are before the West three major areas in which negotiations are at this moment going on. The negotiations on SALT, which concern the Alliance indirectly but which are being conducted primarily between the United States and the Soviet Union; the negotiation on the mutual balance force reductions, in which NATO is negotiating with the Warsaw Pact; and

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the negotiations on European security in which all
European nations -- NATO, Warsaw Pact, as well as
the so-called neutrals, participate.

While in Brussels, the President will have
a series of bilateral meetings; indeed, after the
completion of the Brussels meetings, he will have
had bilateral meetings within the month with every
leader of the Western Alliance. You will have the
schedule of those meetings and therefore, I will
not go through them.

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We believe that their tensions are a tragedy
for the Western Alliance and in the long-term, a tragedy
for the countries concerned and we will do our utmost
to facilitate a solution. But we must also keep in
mind that it is not the United States that can produce
a solution. The solution must be produced by negotiations
among the parties.

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In the new circumstances that that fact created, with a high probability of the Geneva Conference being reconvened, it has been imperative for the United States to assess its policy in the light of these new conditions.

We intend to discuss with President Sadat, as we shall do later with Prime Minister Rabin, our conception of the alternative routes towards peace as they present themselves to us.

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Now, if you agree, let us take the questions in the sequence that we suggested, first about the trip, the West European part of the trip, then about the Middle East part of the trip, and then any general questions that you might have.

Q Will the President find, Mr. Secretary, in Western Europe widespread doubts about U.S. will and purpose in the world now as a result of the MAYAGUEZ and the things the President talked about yesterday?

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SECRETARY KISSINGER: I wouldn't think that as a result of the MAYAGUEZ the President is going to find widespread --

Q No, I mean, will the doubts be dispelled or partly dispelled by that?

SECRETARY KISSINGER: I think that there are questions in many West European countries -- not necessarily in all, but in many -- about the impact on the United States of the events of recent months and about the significance for other areas of the way in which our involvement in Indochina, and I think these questions exist whether they are formally articulated or not.

They can be removed to some extent by words, and to a greater extent by actions, but in this atmosphere it is important for the President to have an opportunity to sketch out a direction in which we can move together.

Q Mr. Kissinger, were you able to tell Foreign Minister Antunes last week that he could expect the NATO summit meetings to discuss, among other things, the conditions under which Portugal might have to be excluded from NATO, as the President alluded to yesterday, or were you as surprised as some of your colleagues in the State Department by the firmness of the President's remarks on that subject?

SECRETARY KISSINGER: I don't know about my colleagues in the State Department, but if they had been talking to me, which is not always guaranteed, then they could not have been surprised.

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I share the President's views on this matter, and what the President was pointing out was the anomaly of a Communist-dominated Government being part of NATO. He was not saying that the Portuguese Government now is Communist dominated. In what way this particular issue will be discussed in Brussels remains to be seen.

Q A follow up on that. Is he going to ask them to discuss conditions under which Portugal should be excluded from the Alliance?

SECRETARY KISSINGER: I doubt that this will be put formally before the Alliance. I think the President was pointing out a problem which will not go away simply by being ignored. He did not say that the problem had in fact already arisen.

Q Mr. Secretary, are implying that -- you talk about bilateral discussions, that there are certain things that could not be discussed with the Portuguese and, therefore, must be discussed with other countries, such as secrecy in NATO military matters and other matters which are too sensitive to be treated in public.

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- 11 -

SECRETARY KISSINGER: I am not implying that, but it is a fact that an Alliance, which is designed to prevent a Communist attack on Western Europe, acquires unique features. If it includes in its deliberations a Government of which many members are Communist, that is a fact -- we are not creating this.

Q Mr. Secretary, if Portugal goes Communist in the literal sense, would you then recommend that it be removed from NATO?

SECRETARY KISSINGER: If Portugal goes Communist, then we have obviously a situation which was not foreseen when NATO was originally formed, and then to pretend that this is something that need not be considered is an absurdity.

Q Mr. Secretary, at what point would you determine that this Government had gone Communist? There is a nebulous situation there, with several parties involved. What I would like to know is, at what point do you decide that this Government is Communist dominated?

SECRETARY KISSINGER: When we think it is Communist dominated (Laughter), and I think that there will be sufficient objective indications of that fact.

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Q Mr. Secretary, can you say what was the
response of the Prime Minister to your observation?

SECRETARY KISSINGER: I had a very friendly
talk with him, and indeed, as we announced on that
occasion, I invited him to visit the United States
within the next three months, and he accepted.

Q But did he show a will of his Government
to remain in NATO in any case?

SECRETARY KISSINGER: Yes, he indicated a
desire to stay in NATO.

Q Mr. Secretary, in the broader European ques-
tions about the American commitment, did you find in
your contacts and in your recent trips that there are
doubts about the American President being able to push
his foreign policy through the American Congress, and how
are you planning to resolve those doubts when you go to
Brussels?

SECRETARY KISSINGER: I have the impression
that the relations between the Executive and the Legislative
are of profound concern to many other countries. I
found that on this trip; I found it at the OAS meeting
previously here in Washington. I say this without
assigning blame for this state of affairs. This is a fact.

Now, I believe that this relationship
is in the process of improvement, and that many of the
conditions that produced the tensions, such as Watergate
and the war in Vietnam, now being behind us, the
possibility for a much more creative cooperation exists.

This would certainly be our attitude. In
any event, the President will make clear to his
colleagues what the Executive conceives our proper respon-
sibilities to be, and we believe -- and we certainly
fervently hope -- that we can obtain the necessary
Congressional support.

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Q By all accounts, the European allies are not very enthusiastic about bringing Spain into a closer relationship with NATO. Does the President have any new arguments, new pressures, or do you expect any change in his attitude?

SECRETARY KISSINGER: No, we have stated our view on the matter. I don't think that this will be an issue that we need to raise with additional intensity. We have made our view clear over the weeks, and we have made our view clear by the trip that the President is taking to Spain, and this may be a matter that will have to be left to time.

Q What is our Government's attitude towards a new security arrangement with Spain?

SECRETARY KISSINGER: We are in the process of negotiating this, of negotiating the extension of the basic agreement, and in the process of these negotiations that will be looked at.

Q Mr. Secretary, is the President going to see any members of the opposition in Madrid?

SECRETARY KISSINGER: The President's schedule is not yet finally settled, and we will announce it when it is.

Q Mr. Secretary, wholly apart from the stated intention of the U.S. reassessment of Middle East policy, isn't it true that it has now taken on a life of its own? I mean, isn't it true that it is being largely viewed, particularly by Israel, as a U.S. tool, a U.S. lever, a U.S. pressure device?

SECRETARY KISSINGER: Can I set this question aside for one moment? I will answer this as the first question on the Middle East part. Let me see if there are two or three more questions on the European part, and then I will take it.

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Q Mr. Secretary, will the 'President confer with President Gissard, and what about France's role?

SECRETARY KISSINGER: President Gissard has agreed to come to the dinner for NATO heads of state, and heads of government that is being given by the King of the Belgians. In connection with the visit of President Gissard for that purpose the President will have a bilateral meeting with the French President, and we look forward to that.

Q Mr. Secretary, in the meeting of NATO in Brussels, could this not be the beginning of the end of NATO as we knew it before, a divergence of interests between the United States and Western Europe in coming years -- the social, political, economic order of things?

SECRETARY KISSINGER: I expect the opposite to happen. I expect that this meeting of NATO will stress some new dimensions for NATO and will usher in a period of new creativity.

Q Mr. Secretary, I would like to question why it is necessary to reassure the NATO allies of the American commitment in view of the fact that that commitment to NATO has been solid since the end of World War II, laying aside Vietnam, which was not a formal treaty commitment?

SECRETARY KISSINGER: Not without provocation.

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Q Well, that is debatable with the Congress, not me, sir.

SECRETARY KISSINGER: We are not going hat in hand to reassure them, and I did not say we are going to Europe to reassure NATO. If you read the record of what I said, I am sure you will find that I stated three major purposes, that the question of reassurance arose in response to queries that were put to me.

Q Let me try it again, if you didn't get it the first time.

SECRETARY KISSINGER: No, I got the point. Let me see what I remember.

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[10]

- 16 -

Q Do you expect to pursue the date for the
European Security Conference?

Q What was the question?

SECRETARY KISSINGER: The date for the European Security Conference does not depend on the United States. The date for the European Security Conference will be determined by the negotiations that are now going on in Geneva in which there are a number of issues still outstanding on confidence-building measures, on human contacts and on post-conference machinery.

In each of these, the West has put forward certain initiatives and is either awaiting the responses or analyzing responses that it has just received. The date of the Security Conference cannot be settled independent of the progress of the negotiations and the best way to speed that conference would be if the Soviet Union considered carefully some of these considerations that we had put forward.

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Q Mr. Secretary, as I understood you, you
said the United States will be willing to put forward
new proposals if neither of the principals came up with
their own proposals for establishing progress.

SECRETARY KISSINGER: At least as to procedures.

Q Well, that was part of the question,
actually. Do you mean to suggest that the United
States will produce proposals in terms of its bilateral
or multilateral relationships with the parties themselves
or for Geneva, or in what context?

SECRETARY KISSINGER: That depends on which
route is chosen. It will be impossible for the United
States to be at Geneva without expressing some view on
the subject at some time.

Q What are the chances of your renewing
shuttle diplomacy, then?

SECRETARY KISSINGER: We cannot judge which method
will be most appropriate until the President has had an
opportunity to talk to some of the parties principally
involved.

Q Mr. Secretary, will the letter from the
Senators giving the broad base support for Israel have
any effect on your dealings with President Sadat or
Prime Minister Rabin?

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SECRETARY KISSINGER: We will take seriously expressions from many quarters. At least some of the statements in that letter contain the ambiguities that have been at the heart of Middle East negotiations for many years and therefore, as we move more deeply into these negotiations, we will have to discuss with the Senate as precisely what meaning is to be given to phrases such as "secure and recognized frontiers," which are also part of Security Council Resolution 242.

Q If President Sadat brings up this latter, queries what effect it has on you and American policy, what is your answer?

SECRETARY KISSINGER: Our answer will be that we are taking into account the views of many groups and, of course, Congressional views with considerable seriousness, that after we have made a decision, we will discuss it at great length with the Senate and with the whole Congress, and that in the meantime, we have to proceed according to our best judgment of the situation.

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- 19 -

Q Mr. Secretary, why do you believe the
Syrians moved to extend the UN mandate for six months,
which puts them out of synchronization with the
Egyptians, and what will the impact of that action
be on the next three to six months?

SECRETARY KISSINGER: I will answer that question, but if we could leave non-Egyptian and Israeli questions out until I get through the second part of my answers. But, I will answer that question.

Q On the Egyptians?

SECRETARY KISSINGER: The impact is that it gives
some more time for a development of peace initiatives
less closely geared to imminent deadlines than seemed
possible a few weeks ago and, therefore, we welcome
this step.

Q Yes, I did. On the question of over-dramatizing MAYAGUEZ, don't you think that the Administration had a big part in that? Also, you were the one who said it was a bonus and benefits.

SECRETARY KISSINGER: That it was what?

Q A bonus and benefits.

SECRETARY KISSINGER: No, I said our purpose
was to free the ship and the crew, and if there were any
collateral benefits, that was a bonus, but not the
primary purpose. That is a different thing from saying
that that was the exclusive purpose.

Q Don't you think that it is being magnified
into a major foreign policy representation?

SECRETARY KISSINGER: I believe that it was
explained in response to very intense queries. I have
stated our view and what has happened previously. I
don't want to --

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- 20 -

Q Mr. Secretary, do you believe that the two super powers will inevitably impose a settlement on the sides in the Middle East if both sides will not come with new proposals?

SECRETARY KISSINGER: We have not thought it wise to impose a settlement, and our policy has been designed to enable the parties concerned to negotiate the structure of a just and lasting peace.

Q Mr. Secretary, does the President plan mainly to listen during the Sadat and Rabin meeting and, if so, what is your expectation for any new position, new consessions, being made by either man?

SECRETARY KISSINGER: No, I think the President will both talk and listen. He will give to both sides our assessment of the situation, and it will be as close to identical to both sides as we can make it.

He will then obviously ask their views on their assessment of the situation, and our reassessment or at least the conclusions we will draw will depend obviously to an important extent on the answers we receive.

Q Mr. Secretary, President Sadat has said publicly now several times that he intends to press President Ford for an answer to what the American position is on supporting Israel, either in the present situation or back to the 1967 borders. What will the President say to President Sadat, or what do you think about that question?

SECRETARY KISSINGER: If I tell you that, maybe President Sadat won't come to the meeting. (Laughter)

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- 21 -

Q Since we have already had no assessment on Mr. Gromyko, can you tell us a little bit of what he indicated to you was the Soviet position on the Middle East?

SECRETARY KISSINGER: I think that the Soviet Union realizes that it is one thing to start a conference, it is another to bring it to a conclusion, and I think every party concerned so far has realized that it was less complicated to talk about Geneva than to bring it off.

Q Mr. Secretary, you say Geneva is a probable outcome, but as you also point out, it is a lot of trouble getting it off the ground. First, we thought it was going to meet early in the summer. Now it appears that it may not be until late in the summer, and the Egyptians are saying possibly not until the end of the year.

SECRETARY KISSINGER: I think I will be in a better position to answer that question in July, after I meet with Foreign Minister Gromyko, and after the President has met with President Sadat and with Prime Minister Rabin and after we have talked to some of the other interested Arab parties.

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- 22 -

Q When you talk about Geneva, are you talking about it in the context we understood it when it first began, that this would be a negotiation or would it simply be a framework within which some variation of shuttle diplomacy might be able to work?

SECRETARY KISSINGER: I don't think I can add anything to the three possible options that the President outlined yesterday.

MR. NESSEN: Why not take just a couple more minutes, Mr. Secretary? You have been at it for about an hour.

SECRETARY KISSINGER: I haven't even gotten started yet. I will take two or three more questions.

Q How would you define the main stumbling block to an interim settlement between Israel and Egypt? Is it the issue of nonbeligerency?

SECRETARY KISSINGER: The issue of the last interim negotiation has taken on the form of the Japanese movie, Rashomon -- there are so many versions of it around now that I don't want to add to the general confusion.

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- 23 -

Q Dr. Kissinger, you said that we have not thought it wise to impose a settlement. Do you have any reason to believe that we could impose a settlement that would be accepted unless it was acceptable to both sides?

SECRETARY KISSINGER: We believe that a settlement must emerge out of a process of negotiation between the two sides in some form, either directly or indirectly.

Q Mr. Secretary, in your meeting with Gromyko, was there any progress made on what appeared to be some differences on the Vladivostok SALT agreement or is that coming along, and do you expect to have something final this year, yet.

SECRETARY: The Vladivostok agreement settled most of the conceptual problems. It left open many of the technical issues in the implementation of the basic concepts. Being technical, these issues become extremely complicated. I believe that we are making progress in clarifying the issues and in narrowing the gap between the two sides.

Q Mr. Secretary --

SECRETARY KISSINGER: I think, Bernie, you had a question.

Q The other Bernie.

MR. NESSEN: Bernie Kalb.

SECRETARY KISSINGER: Oh, Bernie Kalb. I didn't even see him.

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- 24 -

Q Mr. Secretary, in this immediate post-Vietnam era, do you believe that the firmness of your reiterations to outstanding American commitments is matched by an equal firmness of the will of the American people to follow through on those commitments?

END (AT 3:05 P.M. EDT)

The Secretary
of State

Speech

ENERGY: TOWARD A NEW COOPERATIVE ERA

Secretary Henry A. Kissinger before the Meeting at the Ministerial Level of the International Energy Agency.

Today we begin a week of deliberation on the central problems of the industrial democracies: Energy, economic prosperity, the building of a constructive relationship with the developing nations, and ensuring the security of our own countries.

Of these, no issue is more basic to the future than the challenge of energy. The fundamental achievements of our economies, and the modern civilization they sustain, have been built upon the ready availability of energy at reasonable prices.

The energy crisis of 1973 first brought home to us the full implications of the new reality of global interdependence. Energy stands as the first and most fundamental of these new problems; its magnitude compels us to cooperation. Without that cooperation, we risk a return to nationalistic rivalry and economic decline comparable to the bitter experience of the thirties. Now all nations—rich and poor, industrialized and developing—must decide whether growing interdependence will foster common progress or common disaster.

Our objective must be to construct a world energy system capable of providing, on terms fair to all, the fuels needed to continue and extend the progress of our economies and our societies. The path that the members of this agency have chosen begins with consumer solidarity. But a durable international system must ultimately encompass, and be built by, both the consumers and the producers of the world's energy.

This agency has made remarkable progress since the Washington Energy Conference 15

May 27, 1975

Paris, France

months ago. We recognized at Washington that the energy crisis was the most severe challenge to industrial civilization since the Second World War. For a generation North America, Europe, and Japan increasingly allowed oil imports to replace their own energy production. In 1950 the industrialized world imported 5 percent of its requirements. In 1960 this had grown to 17 percent; by 1972 it had reached 39 percent.

The embargo and price rises of 1973 taught us how vulnerable we had become. We saw that neither the supply nor the price of a central factor in our economies was any longer under our control. Our well-being and progress had become hostage to decisions in which we could not take part. At the Washington Energy Conference we recognized that only collective action could reduce our excessive dependence on imported oil and restore to our Governments mastery over our own economies and foreign policies. Separately we could never create conditions for lower oil prices. Nor could any one of us, except at exorbitant cost, defend against a new embargo. Our security, our economic growth, our role in the world were at risk.

Nothing so vividly demonstrates the cooperative vitality of the industrial democracies as the speed and imagination with which this agency acted on these conclusions. It articulated a realistic strategy for attacking the problems of price and supply and launched a series of major steps which together make up the elements of a comprehensive program.

PR 298

(c)

2

* To safeguard against future energy emergencies we committed ourselves to build stocks of oil and, in the event of an embargo, to cut our consumption by an equal percentage and to share available oil.

* For financial solidarity the nations comprising the OECD [Organization for Economic Cooperation and Development] agreed on a fund of $25 billion to protect against financial disruption from oil deficits or from arbitrary shifts of funds by the producers.

* To prevent an increase in our vulnerability over the next few years we set conservation goals and agreed on procedures to verify their implementation.

* To lessen our long-term vulnerability we agreed on an ambitious policy to develop new energy sources through cooperation on individual development projects and safeguarded by a minimum price mechanism.

* To develop the technology to achieve independence by the end of the century we established a far-reaching program of cooperation in energy research and development.

* Finally, we recognized the reality of the new economic and political conditions in which we are acting. Over the long term a stable world energy economy must have the support and serve the interests of both consumers and producers. Therefore, we in this agency have committed ourselves to seek a long-term cooperative economic relationship with the energy-producing nations. This agency has been the principal forum for our preparation for the dialogue with the producers.

In the short term our objective in this agency has been to restore the balance in the international energy market. Through rigorous conservation and the development of alternative sources, we have sought to create such a surplus of capacity that the flexibility of decision of the producers will be reduced. As our conservation policies gain momentum, our dependence on imported oil can at least be kept constant, while our economies recover from the recent recession. As the proportion of our energy needs from our own production increases, the producers' market will begin to shrink—first relatively and then in absolute terms. The producers will have to distribute ever larger cutbacks among themselves to maintain the high prices, and even larger cutbacks to support an increase. Individual

producers—especially those with ambitious development, defense, and other spending programs—will be under pressure to increase sales or, at least, to refuse further production cuts. Thus at some point, if this process succeeds, the cartel will have lost the exclusive and arbitrary control over prices.

We acknowledged, from the start, that our countries vary widely in energy needs and potential. Some of us have major and as yet untapped oil, gas, and coal reserves. Others must rely almost entirely on nuclear energy and new technology to reduce national dependence on imported oil.

This very diversity gives a strong impetus to our cooperation. Because of our interdependence we all have an interest in each other's success. The action each country takes to reduce its vulnerability reduces the vulnerability of us all. And the decision to work cooperatively assures an equitable sharing of costs and benefits. The sacrifices of one country will not simply be offset by the failure of other nations.

All elements of our strategy are linked. Plans to deal with an emergency will prove empty if we permit our dependence on imported oil to mount year by year. Efforts to develop a new relationship with the producers will be thwarted if we fail to create the objective conditions for a new equilibrium through programs of conservation and the development of alternative supplies.

Many of the basic building blocks of our strategy are in place. But much remains to be done. This first ministerial meeting of the IEA faces the following urgent tasks:

* To impose determined conservation programs before our economies begin to expand again;

* To put into effect strong new incentives for developing alternative sources;

* To accelerate research on long-term development of nonconventional energy supplies; and

* To prepare thoroughly for a dialogue with the producers.

Let me deal with each of these in turn.

## Conservation

The cardinal objective of any energy program must be the limitation of growth of consumption. However much we augment our own energy pro-

3

duction, in the medium term it cannot keep pace
with the extravagant annual consumption increases
of the 1960's.

Conservation will be particularly important
over the next few years. Until North Sea and
Alaskan oil and additional coal and nuclear power
become available in quantity, it is the only means
we have to limit our vulnerability.

In February we agreed that the IEA countries
should save 2 million barrels a day by the end of
this year. The recession has put us ahead of that
target. But the reduction in consumption caused
by the recession has also led to complacency about
the need for a strong conservation policy. This has
delayed—in America and elsewhere—the imposition
of conservation measures that will assure us of
future savings.

We must recognize that most of our current
savings result not from policy decisions but from
the reduction in overall economic activity caused
by the recession. During this spring's decline in
demand for oil, the oil producers have absorbed
the production cuts required to keep supply in line
with demand, leaving the basic price structure
intact. Price rises have been difficult. But as growth
resumes in the industrial economies—and with a
normal or cold winter—our demand for oil will in-
evitably increase. Unless we convert our recession-
induced conservation to policy-induced conserva-
tion, the producers will benefit from a stronger
market. We will become increasingly vulnerable to
price rises and the political manipulation of energy
supply. Indeed, we have already been warned of
new price increases. These would be economically
unjustified, for there is much surplus production
capacity, inflation is slowing, and oil prices are
already at historic highs. Yet the market remains
under the substantial control of the producers; it
will become more so unless we impose upon our-
selves a rigorous energy program and put immedi-
ate impetus behind our conservation efforts.

In January President Ford set a goal for the
United States of saving 2 million barrels a day by
the end of 1977. Later today the President will
announce additional measures to discourage the
consumption of imported oil. Together with
actions already taken this will bring the total esti-
mated U.S. savings to 1.2 million barrels a day by
the end of 1977. The President hopes that the
Congress will join him in common action to bring
about the remaining savings needed to meet our

goal of 2 million barrels. But should this not prove
possible, he is prepared to use the powers available
to him to assure that the United States does its
part in the common conservation effort.

We believe it essential that the IEA develop
conservation goals which will prevent our vulnera-
bility from increasing during 1976 and 1977.
Because the United States is responsible for half
the total oil consumption of IEA members, it
pledges itself to half the savings. If together we can
save 4 million barrels a day by the end of 1977, we
can prevent our collective imports of oil from in-
creasing above present levels even after a period of
economic growth. OPEC's [Organization of Petro-
leum Exporting Countries] ability to raise prices
arbitrarily will have been diminished. And we will
have reduced our oil payments deficit by many
billions of dollars. But should we fail, the cost will
be not only higher prices but also increasing eco-
nomic and political vulnerability.

## Alternative Sources

Over the longer term our dependence on
imported oil will become irreversible unless we
rapidly develop new energy sources—oil, gas, coal,
nuclear power.

This is all the more urgent because the eco-
nomic costs of the current level of high prices will
multiply over time. At present much of the pro-
ducers' surplus revenues are recycled into invest-
ments in the industrialized countries. This is
welcome as a short-term alleviation of the balance-
of-payments drain. But if current prices hold
sooner or later the imports of producers will rise
dramatically. There will occur an increasing drain
of goods and services from our economies.

If we are to lessen our vulnerability, energy
production from alternative sources must, at a min-
imum, substantially reduce current IEA imports of
25 million barrels per day. Three actions are
needed to accomplish this.

* We must remove or modify many of our gov-
ernmental constraints on energy production.
Energy development is encumbered everywhere by
legal, environmental, and regulatory limitations.
Many of these reflect valid social goals; others
could usefully be reviewed or modified or alterna-
tive safeguards could be devised. We should use this
organization as a clearinghouse for ideas to remove
unnecessary obstacles to alternative energy sources.

4

* We must make sure that sufficient financing is available to assure energy development. Enormous amounts of capital will be required—perhaps a thousand billion dollars in the next 10 years. Each country should decide the arrangements best suited to meet this requirement but we should proceed now to establish an IEA framework for project-by-project cooperation, including joint guarantees or other financial assistance to large cooperative projects.

* We must ensure that our energy investments are protected against disruptive competition. For much of the Persian Gulf, production costs are only about 25 cents a barrel. Most of the major continental energy sources—new Alaskan North Slope oil, the U.S. Outer Continental Shelf, North Sea oil, nuclear power everywhere—will be many times more costly to produce. If the cartel decides to undercut alternative sources by temporary, predatory price-cutting, investment in alternative sources may be inhibited or abandoned. The producers' pricing policies could thus keep us in a permanent state of dependence, and we would hardly have assurance that the price would not be raised again once our dependence was confirmed.

This is why we in the IEA have agreed in principle on the safeguard price mechanism. Only if consumers develop massive new energy sources will the oil producers lose their ability to set prices at high, artificial levels. But these sources will not be developed if producers retain the ability to thwart our energy programs by temporary, predatory price cuts. A minimum safeguard price—well below the current world price level—can help ensure that these alternative sources will be developed.

We are obviously not proposing a guaranteed price for OPEC. On the contrary, if our policy succeeds, and as large quantities of new energy become available, OPEC's selling price could fall below the protected level. The minimum safeguard price can be implemented in a variety of ways—through tariffs, quotas, or variable levies. The difference between the world price and the higher domestic price would thus accrue to our Governments in the form of import taxes and levies. These could be used for social programs or rebates or other national programs of our own choosing. In short, the minimum safeguard price is not a device

for maintaining artificially high world oil prices. On the contrary, it is a device for making sure that they come down. And it can be designed to yield the benefits from such reduction to the industrial countries.

The agreed deadline for elaboration of the IEA overall alternative sources program is July 1. We must meet it. President Ford has asked me to emphasize the urgency of this task. Without clear incentives for major new energy investments rapidly put into place, IEA countries can never hope to reduce their current excessive vulnerability.

## Nuclear Power

In the quest for greater energy self-reliance, nuclear power will be critical. By 1985 the European Community hopes that nuclear power will generate about one-quarter of its electricity; Japan a third; the United States perhaps a third. But there are major problems associated with the orderly, safe, and prudent introduction of this important new technology.

In all our countries the growth of nuclear power produces both hope and anxiety. On the one hand we recognize it as the only potential large-scale energy substitute for the inevitable exhaustion of supplies of oil and gas which would occur by the end of this century. On the other hand there are increasing doubts that sufficient nuclear fuel will become available. Enormous amounts of capital will be needed to build reactors, severely straining existing capital markets. And we all know of the questions raised by the public and some legislators regarding the environmental impact of the widespread construction of nuclear facilities.

Thus we must move urgently and decisively within the IEA on the following program:

* We must ensure that needed uranium enrichment facilities are constructed on schedule. In this regard the United States recognizes its responsibility to continue providing nuclear fuel under long-term contract. Our policy is to bring into being—preferably by private industry but by the Federal Government if necessary—additional enrichment capacity which will ensure adequate future supply. Negotiations are now underway with a potential private source. These discussions will proceed quickly, and by June 30 the President will decide which course of action—private or public—is in the

5

best interests of our own country and those abroad who rely on us. We will then be in a position to accept long-term orders.

* We must intensify our joint efforts to map and analyze future demand and supply of fuel, including assessing the availability of uranium resources.

* We should jointly project the capital requirements of the nuclear sector for the next 10 years and consider how our Governments—individually and cooperatively—can assist in meeting those requirements.

* We should evaluate the economic necessity, plant requirements, and safety implications of plutonium reprocessing, recycling, and storage.

* We must undertake intensive efforts to improve the safety and security of nuclear materials, equipment, and operation.

* And finally, we should develop balanced information programs to bring perceptions of the risks and benefits of nuclear energy in line with reality.

Several of the technical issues involved are already being dealt with by the OECD's Nuclear Energy Agency. That work should of course continue.

## Research and Development

Beyond the next decade a central issue will be how to create new, nonconventional energy sources. It is in developing these new sources that IEA's program of cooperation may make its most important and lasting contribution.

For the long-range energy future depends not on the Persian Gulf or the North Sea or Alaska. It does depend on what we do in our laboratories to make better use of conventional newer sources and to develop more exotic sources. The advanced nations have vast scientific and technical capabilities. Over the past year and a half IEA member countries have expanded their national programs in energy research and development. In the United States our new Energy Research and Development Administration will spend more than $2 billion in the fiscal year beginning next month. American industry will invest far more than that.

The U.S. program emphasizes improving the efficiency of energy generation, transportation, and use; improving the recovery of oil and new uses of coal; and converting coal to synthetic oil

and gas. These projects are designed to produce major advances in energy production and use in this century. For the period beyond the year 2000 only three known potential sources of energy have virtually infinite potential for expansion—the breeder reactor, nuclear fusion, and solar energy. These all have a high priority in the U.S. program.

The IEA program in these fields reflects the conviction that technical advance will be accelerated through cooperative efforts and facilitate the flow of information and knowledge. We have decided to link our national programs through coordinated planning, intensified information exchange, and through joint projects which pool our capital, industrial skills, and technology.

The early results are promising. We have moved forward rapidly on nine joint projects ranging from energy conservation to nuclear power. Important programs in coal processing, which involve substantial joint investments of money and manpower, are about to begin.

But a sustained program of cooperation requires much more. We have identified the existing and potential technologies that will have a critical impact on the future. We must now ascertain when these technologies can be implemented, what their production potential is, and which are best suited to large-scale joint projects.

As our cooperation expands projects will increasingly operate at the frontier of technology. We will each have to recognize that we cannot retain the most promising projects solely for our own national purposes. We must establish guidelines which, while taking account of understandable concern over the sharing of information and the possible loss of commercial advantage, give impetus to multilateral cooperation.

Therefore, I propose that our leading research and development officials meet in early autumn at the special session of the Governing Board. Their goal would be to complete the design of a joint energy research and development program that will receive high priority in all of our national planning.

## Relations with Producers

The final element of our energy strategy is the development of a cooperative relationship with producers. We must face the fact that the producers have the ability now and for some time to come to determine the supply and the price of our oil. But the decisions we make now on conservation

6

and alternative sources will determine whether in
the future prices will be set by political decision or
economic competition.

Yet there exists no institution or agreed
framework in which the exercise of the undoubted
powers of both groups can be subject to discussion
and mutual accommodation.

Since its start IEA has been committed to the
search for a new relationship with the producers
which would take into account the needs and aspi-
rations of both sides. The solidarity we have
achieved in IEA is a necessary condition for build-
ing that broader structure.

Before the recent preparatory conference
between producers and consumers, the IEA agreed
on several possible areas for joint action by produc-
ers and consumers. These remain fruitful topics for
dialogue.

First, we should discuss the management of
financial recycling. Both producers and consumers
have an interest in the effective reinvestment of
surplus funds.

Second, we should jointly examine the in-
coming investment policies of the industrialized
countries. The oil producers need attractive outlets
for their revenues; the industrial countries, while
they welcome new investment, will want to retain
control of those sectors of their economies which
they consider critical.

Third, we can examine cooperative efforts to
accelerate the development programs in producer
countries. New industries can be established, com-
bining the technology of the industrialized world
with the energy and capital of the producers. Fer-
tilizer is a promising example.

Fourth, the oil-producing countries and the
industrial consuming countries share responsibility
for easing the plight of the poorest nations. Inter-
national development efforts have been under-
mined by the current economic crisis; high prices
for energy have shattered the hopes of developing
nations for industrialization; high petrochemical
costs have made needed fertilizer prohibitively
expensive and compounded the difficulties of
producing enough food to feed the hungry. Special
efforts must be made on behalf of those most
seriously affected. The newly rich producing na-
tions have an obligation to join us in this effort.

And finally, there is an obvious need for a
forum in which producers and consumers can
discuss the difficult issues of oil prices and security
of supply. This dialogue is not, of course, a substi-
tute for our own efforts on conservation and the
development of new supplies. But while we cannot
protect these vital interests only by discussions
with producers, both consumers and producers can
benefit from a serious dialogue regarding their
respective interests and objectives.

It has become clear—as a result of the April
preparatory meeting—that the dialogue between
the producers and consumers will not progress
unless it is broadened to include the general issue
of the relationship between developing and devel-
oped countries.

We in the IEA have no reason to recoil from a
discussion of all the issues of concern to developing
countries. I recently [May 13, Kansas City] set forth
my country's ideas on raw materials and commodi-
ties problems; I proposed that these now be addres-
sed in the multilateral trade negotiations, in indi-
vidual commodity groups, and in the World Bank
[International Bank for Reconstruction and Devel-
opment]. I shall put forward further proposals at
the OECD tomorrow. I hope that these ideas as
well as proposals put forward by others can help
overcome the impasse in the producer-consumer
dialogue.

The United States is prepared to have the pre-
paratory meeting reconvene in Paris in the same
format as before. In order to carry its work for-
ward commissions should be created to deal with
critical areas such as energy, problems of the most
seriously affected nations, and raw materials. Each
commission would review the range of issues under
its heading: finance, investment, trade, production.
The commissions could meet consecutively or
simultaneously but without an arbitrary deadline
for concluding their work. The commissions on
raw materials and the problems of the most seri-
ously affected nations would not supplant the al-
ready substantial work which is being done else-
where. Rather they would monitor, supplement,
and orient that work and give it needed impetus.
Membership in these commissions should be
limited if they are to be effective. We suggest that
this be decided by objective criteria. In energy, for
example, countries exporting or importing more

7

than a certain volume of energy in the world market should be members. On the commission dealing with the most seriously affected countries, those with the lowest per capita income would participate along with traditional and new aid donors. The commission on commodities could include the principal exporters and importers of food and non-oil raw materials.

We suggest that the IEA discuss these concepts and coordinate our contacts with the countries that attend the April meeting, and especially with France as the convening country to determine when and how the preparatory meeting could be reassembled.

## Conclusion

This agency has already demonstrated what can be accomplished if nations have the vision to

perceive their interest and the will to act upon it. We have set ourselves important goals, including broadening the pattern of cooperation already established here. We are called upon to make concrete progress; this will require the readiness to look beyond our own concerns as industrialized nations to the broader needs of all mankind.

The progress we have made in a short 15 months should give us great hope for the future. Goethe said that "The web of this world is woven of necessity and chance." We stand at a point where those strands intertwine. We must not regard necessity as capricious nor leave change to chance. Necessity impels us to where we are but summons us to choose where we go. Our interdependence will make us thrive together or decline together. We can drift or we can decide. We have no excuse for failure. We have it in our power to build a better future.

Q. What do you expect from the meeting between President Ford and President Sadat?

Secretary Kissinger: As I pointed out before, we would like to learn the precise views of the President of Egypt about how peace in the Middle East can be advanced. We, of course, have been undertaking an assessment of our policy, and we will inform President Sadat of our present tentative thinking which will not be concluded until we have also talked to Prime Minister Rabin [of Israel]. But we will make clear, as we have stated repeatedly publicly, that the United States is not prepared to accept a diplomatic stalemate in the Middle East and that we are convinced that progress toward peace in the Middle East must continue.

The press: Thank you, sir.

STATEMENT BEFORE MINISTERIAL MEETING
OF THE IEA GOVERNING BOARD, MAY 27, 1975

Press release 298 dated May 27

Today we begin a week of deliberation on the central problems of the industrial democracies: energy, economic prosperity, the building of a constructive relationship with the developing nations, and insuring the security of our own countries.

energy system capable of providing, on terms fair to all, the fuels needed to continue and extend the progress of our economies and our societies. The path that the members of this Agency have chosen begins with consumer solidarity. But a durable international system must ultimately encompass, and be built by, both the consumers and the producers of the world's energy.

This Agency has made remarkable progress since the Washington Energy Conference 15 months ago. We recognized at Washington that the energy crisis was the most severe challenge to industrial civilization since the Second World War. For a generation North America, Europe, and Japan increasingly allowed oil imports to replace their own energy production. In 1950 the industrialized world imported 5 percent of its requirements. In 1960, this had grown to 17 percent; by 1972, it had reached 39 percent.

The embargo and price rises of 1973 taught us how vulnerable we had become. We saw that neither the supply nor the price of a central factor in our economies was any longer under our control. Our well-being and progress had become hostage to decisions in which we could not take part. At the Washington Energy Conference we recognized that only collective action could reduce our excessive dependence on imported oil and restore to our governments mastery over our own economies and foreign policies. Separately we could never create conditions for lower oil prices. Nor could any one of us, except at exorbitant cost, defend against a new embargo. Our security, our economic growth, our role in the world, were at risk.

Nothing so vividly demonstrates the cooperative vitality of the industrial democracies as the speed and imagination with which this Agency acted on these conclusions. It articulated a realistic strategy for attacking the problems of price and supply and launched a series of major steps which together make up the elements of a comprehensive program:

- To safeguard against future energy emergencies, we committed ourselves to build

838

Department of State Bulletin

IEA Ministerial

May 27, 1975

[LC]

—For financial solidarity, the nations comprising the OECD agreed on a fund of $25 billion to protect against financial disruption from oil deficits or from arbitrary shifts of funds by the producers.

—To prevent an increase in our vulnerability over the next few years, we set conservation goals and agreed on procedures to verify their implementation.

—To lessen our long-term vulnerability, we agreed on an ambitious policy to develop new energy sources through cooperation on individual development projects and safeguarded by a minimum price mechanism.

—To develop the technology to achieve independence by the end of the century, we established a far-reaching program of cooperation in energy research and development.

—Finally, we recognized the reality of the new economic and political conditions in which we are acting. Over the long term, a stable world energy economy must have the support and serve the interests of both consumers and producers. Therefore we in this Agency have committed ourselves to seek a long-term cooperative economic relationship with the energy-producing nations. This Agency has been the principal forum for our preparation for the dialogue with the producers.

In the short term, our objective in this Agency has been to restore the balance in the international energy market. Through rigorous conservation and the development of alternative sources, we have sought to create such a surplus of capacity that the flexibility of decision of the producers will be reduced. As our conservation policies gain momentum, our dependence on imported oil can at least be kept constant, while our economies recover from the recent recession. As the proportion of our energy needs from our own production increases, the producers' market will begin to shrink, first relatively and then in absolute terms. The producers will have to distribute ever-larger cutbacks among themselves to maintain the high

prices, and even larger cutbacks to support an increase. Individual producers, especially those with ambitious development, defense, and other spending programs, will be under pressure to increase sales or at least to refuse further production cuts. Thus at some point, if this process succeeds, the cartel will have lost the exclusive and arbitrary control over prices.

We acknowledged from the start that our countries vary widely in energy needs and potential. Some of us have major and as yet untapped oil, gas, and coal reserves. Others must rely almost entirely on nuclear energy and new technology to reduce national dependence on imported oil.

This very diversity gives a strong impetus to our cooperation. Because of our interdependence, we all have an interest in each other's success. The action each country takes to reduce its vulnerability reduces the vulnerability of us all. And the decision to work cooperatively assures an equitable sharing of costs and benefits. The sacrifices of one country will not simply be offset by the failure of other nations.

—To impose determined conservation programs before our economies begin to expand again;

—To put into effect strong new incentives for developing alternative sources;

—To accelerate research on long-term development of nonconventional energy supplies; and

—To prepare thoroughly for a dialogue with the producers.

June 23, 1975

839

The cardinal objective of any energy program must be the limitation of growth of consumption. However much we augment our own energy production, in the medium term it cannot keep pace with the extravagant annual consumption increases of the 1960's.

In February, we agreed that the IEA countries should save 2 million barrels a day by the end of this year. The recession has put us ahead of that target. But the reduction in consumption caused by the recession has also led to complacency about the need for a strong conservation policy. This has delayed—in America and elsewhere—the imposition of conservation measures that will assure us of future savings.

We must recognize that most of our current savings result not from policy decisions but from the reduction in overall economic activity caused by the recession. During this spring's decline in demand for oil, the oil producers have absorbed the production cuts required to keep supply in line with demand, leaving the basic price structure intact. Price rises have been difficult. But as growth resumes in the industrial economies, and with a normal or cold winter, our demand for oil will inevitably increase.

Unless we convert our recession-induced conservation to policy-induced conservation, the producers will benefit from a stronger market. We will become increasingly vulnerable to price rises and the political manipulation of energy supply. Indeed, we have already been warned of new price increases. These would be economically unjustified, for there is much surplus production capacity, inflation is slowing, and oil prices are already at historic highs. Yet the market remains under the substantial control of the producers; it will become more so unless we impose upon ourselves a rigorous energy program and put immediate impetus behind our conservation efforts.

In January, President Ford set a goal for the United States of saving 2 million barrels a day by the end of 1977. Later today, the President will announce additional measures to discourage the consumption of imported oil.

Together with actions already taken, this will bring the total estimated U.S. savings to 1.2 million barrels a day by the end of 1977. The President hopes that the Congress will join him in common action to bring about the remaining savings needed to meet our goal of 2 million barrels. But should this not prove possible, he is prepared to use the powers available to him to assure that the United States does its part in the common conservation effort.

We believe it essential that the IEA develop conservation goals which will prevent our vulnerability from increasing during 1976 and 1977. Because the United States is responsible for half the total oil consumption of IEA members, it pledges itself to half the savings. If, together, we can save 4 million barrels a day by the end of 1977, we can prevent our collective imports of oil from increasing above present levels even after a period of economic growth. OPEC's [Organization of Petroleum Exporting Countries] ability to raise prices arbitrarily will have been diminished. And we will have reduced our oil payments deficit by many billions of dollars. But should we fail, the cost will be not only higher prices but also increasing economic and political vulnerability.

## Alternative Sources

Over the longer term, our dependence on imported oil will become irreversible unless we rapidly develop new energy sources—oil, gas, coal, nuclear power. This is all the more urgent because the economic costs of the current level of high prices will multiply over time. At present, much of the producers' surplus revenues are recycled into investments in the industrialized countries. This is welcome as a short-term alleviation of the balance-of-payments drain. But, if current prices hold, sooner or later the im-

840

Department of State Bulletin

If we are to lessen our vulnerability, energy production from alternative sources must, at a minimum, substantially reduce current IEA imports of 25 million barrels per day. Three actions are needed to accomplish this:

- We must remove or modify many of our governmental constraints on energy production. Energy development is encumbered everywhere by legal, environmental, and regulatory limitations. Many of these reflect valid social goals; others could be usefully be reviewed or modified, or alternative safeguards could be devised. We should use this organization as a clearinghouse for ideas to remove unnecessary obstacles to alternative energy sources.

- We must make sure that sufficient financing is available to assure energy development. Enormous amounts of capital will be required—perhaps a thousand billion dollars in the next 10 years. Each country should decide the arrangements best suited to meet this requirement, but we should proceed now to establish an IEA framework for project-by-project cooperation, including joint guarantees or other financial assistance to large cooperative projects.

- We must insure that our energy investments are protected against disruptive competition. For much of the Persian Gulf, production costs are only about 25 cents a barrel. Most of the major continental energy sources—new Alaskan North Slope oil, the U.S. outer continental shelf, North Sea oil, nuclear power everywhere—will be many times more costly to produce. If the cartel decides to undercut alternative sources by temporary, predatory price-cutting, investment in alternative sources may be inhibited or abandoned. The producers' pricing policies could thus keep us in a permanent state of dependence, and we would hardly have assurance that the price would not be raised again once our dependence was confirmed.

Only if consumers develop massive new energy sources will the oil producers lose their ability to set prices at high, artificial levels. But these sources will not be developed if producers retain the ability to thwart our energy programs by temporary, predatory price cuts. A minimum safeguard price—well below the current world price level—can help insure that these alternative sources will be developed.

We are obviously not proposing a guaranteed price for OPEC. On the contrary, if our policy succeeds, and as large quantities of new energy become available, OPEC's selling price could fall below the protected level. The minimum safeguard price can be implemented in a variety of ways—through tariffs, quotas, or variable levies. The difference between the world price and the higher domestic price would thus accrue to our governments in the form of import taxes and levies. These could be used for social programs or rebates or other national programs of our own choosing. In short, the minimum safeguard price is not a device for maintaining artificially high world oil prices. On the contrary, it is a device for making sure that they come down. And it can be designed to yield the benefits from such reduction to the industrial countries.

## Nuclear Power for Energy Production

In the quest for greater energy self-reliance, nuclear power will be critical. By 1985, the European Community hopes that nuclear power will generate about one-quarter of its electricity; Japan, a third; the United States, perhaps a third. But there are major problems associated with the orderly, safe, and prudent introduction of this important new technology.

In all our countries, the growth of nuclear

June 23, 1975

841

clear power produces both hope and anxiety. On the one hand, we recognize it as the only potential large-scale energy substitute for the inevitable exhaustion of supplies of oil and gas which would occur by the end of this century. On the other hand, there are increasing doubts that sufficient nuclear fuel will become available. Enormous amounts of capital will be needed to build reactors, severely straining existing capital markets. And we all know of the questions raised by the public and some legislators regarding the environmental impact of the widespread construction of nuclear facilities.

- We must insure that needed uranium enrichment facilities are constructed on schedule. In this regard, the United States recognizes its responsibility to continue providing nuclear fuel under long-term contract. Our policy is to bring into being—preferably by private industry but by the Federal Government if necessary—additional enrichment capacity which will insure adequate future supply. Negotiations are now underway with a potential private source. These discussions will proceed quickly, and by June 30, the President will decide which course of action, private or public, is in the best interests of our own country and those abroad who rely on us. We will then be in a position to accept long-term orders.

- We must intensify our joint efforts to map and analyze future demand and supply of fuel, including assessing the availability of uranium resources.

- We should jointly project the capital requirements of the nuclear sector for the next 10 years and consider how our governments, individually and cooperatively, can assist in meeting those requirements.

- We should evaluate the economic necessity, plant requirements, and safety implications of plutonium reprocessing, recycling, and storage.

- We must undertake intensive efforts to improve the safety and security of nuclear materials, equipment, and operation.

- And finally, we should develop balanced information programs to bring perceptions

## Research and Development

Beyond the next decade, a central issue will be how to create new nonconventional energy sources. It is in developing these new sources that IEA's program of cooperation may make its most important and lasting contribution.

For the long-range energy future depends not on the Persian Gulf, or the North Sea, or Alaska. It does depend on what we do in our laboratories to make better use of conventional newer sources and to develop more exotic sources.

The advanced nations have vast scientific and technical capabilities. Over the past year and a half, IEA member countries have expanded their national programs in energy research and development. In the United States our new Energy Research and Development Administration will spend more than $2 billion in the fiscal year beginning next month. American industry will invest far more than that.

The U.S. program emphasizes improving the efficiency of energy generation, transportation, and use; improving the recovery of oil and new uses of coal; and converting coal to synthetic oil and gas. These projects are designed to produce major advances in energy production and use in this century. For the period beyond the year 2000, only three known potential sources of energy have virtually infinite potential for expansion: the breeder reactor, nuclear fusion, and solar energy. These all have a high priority in the U.S. program.

842

Department of State Bulletin

(10)

As our cooperation expands, projects will increasingly operate at the frontier of technology. We will each have to recognize that we cannot retain the most promising projects solely for our own national purposes. We must establish guidelines which, while taking account of understandable concern over the sharing of information and the possible loss of commercial advantage, give impetus to multilateral cooperation.

## Relations With Producers

The final element of our energy strategy is the development of a cooperative relationship with producers. We must face the fact that the producers have the ability now and for some time to come to determine the supply and the price of our oil. But the decisions we make now on conservation and alternative sources will determine whether in the future prices will be set by political decision or economic competition.

Since its start, IEA has been committed to the search for a new relationship with the producers which would take into account the needs and aspirations of both sides. The solidarity we have achieved in IEA is a necessary condition for building that broader structure.

Before the recent preparatory conference between producers and consumers, the IEA agreed on several possible areas for joint action by producers and consumers. These remain fruitful topics for dialogue:

- First, we should discuss the management of financial recycling. Both producers and consumers have an interest in the effective reinvestment of surplus funds.

- Second, we should jointly examine the incoming-investment policies of the industrialized countries. The oil producers need attractive outlets for their revenues; the industrial countries, while they welcome new investment, will want to retain control of those sectors of their economies which they consider critical.

- Third, we can examine cooperative efforts to accelerate the development programs in producer countries. New industries can be established, combining the technology of the industrialized world with the energy and capital of the producers. Fertilizer is a promising example.

- Fourth, the oil-producing countries and the industrial consuming countries share responsibility for easing the plight of the poorest nations. International development efforts have been undermined by the current economic crisis; high prices for energy have shattered the hopes of developing nations for industrialization; high petrochemical costs have made needed fertilizer prohibitively expensive and compounded the difficulties of producing enough food to feed the hungry. Special efforts must be made on behalf of those most seriously affected. The newly rich producing nations have an obligation to join us in this effort.

- And finally, there is an obvious need for a forum in which producers and consumers can discuss the difficult issues of oil prices and security of supply. This dialogue

June 23, 1975

843

is not, of course, a substitute for our own
efforts on conservation and the development
of new supplies. But while we cannot pro-
tect these vital interests only by discussions
with producers, both consumers and pro-
ducers can benefit from a serious dialogue
regarding their respective interests and ob-
jectives.

It has become clear—as a result of the
April preparatory meeting—that the dia-
logue between the producers and consumers
will not progress unless it is broadened to
include the general issue of the relationship
between developing and developed countries.

We in the IEA have no reason to recoil
from a discussion of all the issues of concern
to developing countries. I recently set forth
my country's ideas on raw materials and
commodities problems; I proposed that
these now be addressed in the multilateral
trade negotiations, in individual commodity
groups, and in the World Bank. I shall put
forward further proposals at the OECD
tomorrow. I hope that these ideas as well
as proposals put forward by others can help
overcome the impasse in the producer-
consumer dialogue.

The United States is prepared to have the
preparatory meeting reconvene in Paris in
the same format as before. In order to carry
its work forward, commissions should be
created to deal with critical areas such as
energy, problems of the most seriously af-
fected nations, and raw materials. Each
commission would review the range of issues
under its heading: finance, investment, trade,
production. The commissions could meet
consecutively or simultaneously, but without
an arbitrary deadline for concluding their
work. The commissions on raw materials
and the problems of the most seriously
affected nations would not supplant the al-
ready substantial work which is being done
elsewhere. Rather, they would monitor, sup-
plement, and orient that work and give it
needed impetus.

Membership in these commissions should
be limited if they are to be effective. We
suggest that this be decided by objective
criteria. In energy, for example, countries
exporting or importing more than a certain

volume of energy in the world market should
be members. On the commission dealing
with the most seriously affected countries,
those with the lowest per capita income
would participate along with traditional and
new aid donors. The commission on commodi-
ties could include the principal exporters and
importers of food and non-oil raw materials.

We suggest that the IEA discuss these
concepts and coordinate our contacts with
the countries that attended the April meet-
ing, and especially with France as the
convening country, to determine when and
how the preparatory meeting could be re-
assembled.

This Agency has already demonstrated
what can be accomplished if nations have the
vision to perceive their interest and the will
to act upon it. We have set ourselves im-
portant goals including broadening the pat-
tern of cooperation already established here.
We are called upon to make concrete prog-
ress; this will require readiness to look
beyond our own concerns as industrialized
nations to the broader needs of all mankind.

The progress we have made in a short
15 months should give us great hope for
the future. Goethe said that "The web of
this world is woven of necessity and chance."
We stand at a point where those strands
intertwine. We must not regard necessity as
capricious nor leave change to chance. Necess-
sity impels us to where we are but summons
us to choose where we go. Our interdepend-
ence will make us thrive together or decline
together. We can drift, or we can decide. We
have no excuse for failure. We have it in our
power to build a better future.

TEXT OF IEA COMMUNIQUE, MAY 27

PARIS, 27th May, 1975.

The Governing Board of the International Energy Agency met at Ministerial level in Paris on 27th May, 1975, under the Chairmanship of Mr. Renaat van Elslande, Minister for Foreign Affairs of the Kingdom of Belgium.

1. Ministers noted that the events of recent years have highlighted the importance for the world economy of a regular and stable energy supply. Solutions to current economic problems must rest upon the principles of inter-dependence of all coun-

844

Department of State Bulletin

May 28, 1975

No. 304

PC #57

PRESS CONFERENCE
OF
THE HONORABLE HENRY A. KISSINGER
SECRETARY OF STATE
AMERICAN EMBASSY, PARIS

MAY 27, 1975

SECRETARY KISSINGER:

Ladies and Gentlemen:

I will just make a very few remarks. The series of meetings that are taking place this week, at the IEA today, the OECD tomorrow, followed by the NATO Summit represent a kind of architecture of the structure of the world as we can foresee it developing. I will not talk about the NATO Summit today. I will make a few remarks about the IEA and the OECD. We consider the progress that has been made in energy cooperation among the members of the IEA one of the most significant achievements of the recent period. It symbolizes the ability of the industrial democracies to work together on a common problem. They have laid a foundation of major accomplishment in a very brief period of time since the Washington Energy Conference of February 1974. The meeting today and the American position at that meeting was designed to take stock of what has been achieved and to chart the course for the future. It outlined the American proposals, outlined the objectives in the field of conservation, the development of alternative sources, the emphasis on nuclear power, the joint efforts in research and development that we believe can be undertaken by the IEA in the immediate future and that must be undertaken if the objective conditions that produced the energy crisis are to be alleviated and, over a period of time, eliminated. We believe that these objectives are within our capacity to achieve. An important aspect of our view and that of our colleagues in the IEA has to do with producer/consumer relations, and this has to be seen in the context of what we shall do at the OECD tomorrow, mainly to sketch a new and, we hope, constructive approach to the relationship between the industrialized countries and the developing countries. With respect to the consumer/producer dialogue, we have proposed a means by which the stalemate of the last conference can hopefully be overcome, by which it is possible to have discussions on energy which take place concurrently with discussions on raw materials and development in probably different forums that are related to each other, but where each works on its own schedule. Together with the specific proposals that we have made with respect to raw materials previously and that we shall elaborate tomorrow, we hope that the possibility has been created for a constructive dialogue between consumers and producers on energy and between industrialized and developing countries on a local basis. This is the approach that the United States is putting forward, which we believe has the substantial support of our partners, and it offers hope for progress in the field of energy and, we hope, for a constructive dialogue with the developing countries.

TO-#7

(c)

QUESTION: Mr. Secretary, the commissions you proposed today, are they entirely discussion groups and, if not, what else would they do?

SECRETARY KISSINGER: The commissions we proposed - three commissions - although we are open-minded on this - on energy, on raw materials and on development. These commissions are to review the whole range of problems in their fields. In the case of energy the commission should be, in effect, the Energy Conference. In the case of raw materials and development, there are other negotiations going on in other forums, and the role of these commissions would be to pull together the work in these other forums, to (I suppose fora is the correct word) to monitor it, to orient it, and therefore perhaps the emphasis in each group would be somewhat different. But we are not looking at them as simply discussion groups, but as groups that will contribute to the solution of the outstanding problems.

QUESTION: Mr. Secretary, how do you respond to the reactions you are bound to get from some of the producing nations that this merely postpones coming to grips with the issues and that it puts the discussion off into the distant future?

SECRETARY KISSINGER: First of all I do not believe that this is the reaction that we will get from the producing nations because we have had some preliminary talks with at least some producing nations in which that particular view - in which that particular criticism was not raised. Secondly, if it were raised, it would not be a valid criticism because in our government, as is well-known, there was a rather firm objection to discussing the issue of raw materials at all, and therefore the readiness of the United States to discuss raw materials within the framework that we have proposed is a step that was deliberately intended to tell the developing nations that we were listening to their concerns, and that while we may not agree with their solutions, and in many cases do not agree with their solutions, we are willing to listen to their concerns, to discuss them and to try to find equitable answers. The particular procedure that we have proposed is not intended to postpone the solution, but rather to accelerate it. If everything were discussed in one commission or in one conference, it would be incapable of being brought to a point. By discussing it in separate commissions, each of which can then review the work that may already be going on in other forums, but supplement it when that is necessary, we believe we have proposed a procedure that can lead to as rapid a conclusion as the technical complexity of the subject permits. Our intention was not to put it into the distant future, but to come forward with a proposal that is something other than a huge meeting like the special session of the General Assembly and is specific enough to meet the concerns of the developing countries as well as reflect our own interests.

QUESTION: Mr. Secretary, how do you explain the change in opinion since last April (in the U. S. regarding commodities)?

SECRETARY KISSINGER: You have to separate two things. One is the attitude we took at the Producer/Consumer Conference and we are still opposed to discussing energy development and raw materials all in one big meeting. But we are not opposed to discussing them in a way where their relationship is established. So we have not in this respect changed our view totally. With respect to the second, we have had a study in our government looking at the problem of raw materials which has been going on for months and which came to fruition in recent weeks.

-3-

PC #57

(L)

That study had always been pointed toward the time of the OECD meeting and the Special Session of the General Assembly. With respect to this, what the United States wants to do is to show its willingness, as I pointed out, to discuss issues that are of great concern to a major part of mankind. We will not necessarily accept their views on the specific remedies. We, for example, are not in favor of indexation, but we have turned attention to the relationship between the industrial and developing countries. This is not a change and is not sudden. It has been in preparation for months as a result of a series of interdepartmental studies, and it was just brought to a focus at this moment.

QUESTION: Mr. Secretary (inaudible, in substance, asks if Secretary has received support for his approach in bilateral discussions with any major OPEC nation.)

SECRETARY KISSINGER: Yes, we have. I do not want to embarrass any OPEC country, and obviously they are going to make their own decisions, but we have had exploratory talks with a number of OPEC countries, and my impression is that this general approach will find some support. In fact, it has found support among the countries with which it was discussed, which is, however, not all the OPEC countries.

QUESTION: Mr. Secretary, what would be the relationship between various commissions? Would progress in one commission depend on progress in other commissions?

SECRETARY KISSINGER: In our view that is not necessarily the case. As I understand the view of at least some of the OPEC countries, their view was not that all work had to be concluded simultaneously, but that they wanted to make sure that we would not talk only of the commodity that concerned us while all other issues were left for some indeterminate future. Therefore, each commission should set its own pace, and its conclusions should not necessarily be dependent on the conclusions of the other commissions. But no doubt as the work develops there will be opportunities for exchanges of views between the commissions, and I think we should keep an open mind as this work continues. The point I want to make is that the United States is prepared to make a serious effort with good will and a cooperative attitude to deal with these problems, and that we are calling on the developing countries in the energy field and on the producing countries to avoid confrontation and to deal with the practical problems. That will be the theme of my speech at OECD tomorrow.

QUESTION: With respect to the conference in Geneva on the Middle East, what is your expectation about it?

SECRETARY KISSINGER: With respect to the conference at Geneva. As you know President Ford is meeting President Sadat this weekend. He will subsequently be with Prime Minister Rabin. Until those discussions have been completed, it will be difficult for us to make a judgment when the Geneva Conference can be resumed. I have stated publicly that we believe that the Geneva Conference is a probable outcome of the present evolution. I am also planning to meet again with Soviet Foreign Minister Gromyko, probably in July. At that point we will be able to give a clearer view as to when the Geneva Conference is likely to be reassembled.

QUESTION: In what time frame would you put the resumption of the preparatory conference?

SECRETARY KISSINGER: We have had a preliminary talk today with our partners in the IEA and I had the impression, although I do not think any formal decision has yet been taken - that the general approach outlined was favorably received. We will, of course, be in close touch after completing our discussions in the IEA with the Government of France, as the convening country, and we would, of course, expect that France would again act as the convening country. We set no exact time frame, but we have no particular reason for delay either, so sometime over the next few months I believe that the time would be appropriate.

QUESTION: Do you believe that this new American proposal will head off an oil price increase in September?

SECRETARY KISSINGER: Well, the oil price increase, the projected oil price increase, depends of course on many considerations. We cannot gear our negotiations to an attempt to head off an oil price increase. The United States position is that an oil price increase would be economically unjustified; that oil prices are at historic highs, and - as recent studies have shown - that the price of other raw materials has not been out of line. So we would oppose an oil price increase, and we hope that the OPEC countries will reflect further on the impact on the world economy of a continual increase in oil prices.

QUESTION: (Inaudible, in substance asks why Secretary did not mention UNCTAD in his IEA speech, and if he opposes an UNCTAD role in dealing with the commodity problem.)

SECRETARY KISSINGER: With respect to commodities? These are the specific proposals that we have put forward. We are prepared to examine other forums where this might be considered.

QUESTION: Mr. Secretary, you spoke at the outset of developing a kind of architecture to structure the world as we can see it develop. In your talks this morning with the French President did you find him looking at the same structure, or did he have a housing plan of his own?

SECRETARY KISSINGER: Well, I think that France prides itself on its independent foreign policy. Obviously we have no objections to France having an independent foreign policy. On the whole my impression was of a considerable mutuality of approach. There could be occasional differences in tactics. There might be a difference in emphasis, but I thought on the over-all approach that the talks were very satisfactory and were conducted in a very constructive and positive atmosphere.

QUESTION: Mr. Secretary, I notice that there is some change in the time frame, when you spoke this morning, I believe it was a month, and now you are speaking of a few months.

SECRETARY KISSINGER: It could be a question of my accent - that you did not hear the "s". Nothing has changed between what I said this morning and what I said this afternoon. We are prepared to begin discussions immediately. We are in discussions now with our IEA partners. We will be discussing in the near future after conclusions have been reached with the Government of France, and will continue exploratory talks with the producers. We have no reason to hold up the resumption of the preparatory conference. Sometime in the next

-5-

PC #57

(10)

months, with an "s" at the end; and that's what I intended to say
this morning.

QUESTION: Following President Ford's discussion with President Sadat in Salzburg, and Prime Minister Rabin in Washington do you plan to go back to the area for a new shuttle diplomacy?

SECRETARY KISSINGER: Well, the method of the diplomacy is not what is crucial, and it depends, of course, on what progress is made and toward what particular end. The United States has not excluded any particular approach. On the contrary, we are prepared to pursue any approach that makes progress toward peace. We have excluded a stalemate of any duration. So in principle we are prepared to be helpful in whatever direction the parties concerned believe would be most useful to them.

* * * * *

The Secretary
of State

Speech

May 28, 1975

Paris, France

Bureau of Public Affairs

Office of Media Services

THE IMPERATIVE OF GROWTH AND
COOPERATION

*Secretary Henry A. Kissinger before the Ministerial*
*Council of the Organization for Economic*
*Cooperation and Development.*

When free nations join forces for the common good they can achieve great things.

This organization embodies the legacy and
the hope of the Marshall Plan, one of the most
creative achievements of international collabora-
tion. The nations represented here have every
reason to be proud of the advances which they
have achieved for their peoples during the past 30
years. Our progress has fostered global progress.
Our success has demonstrated that hope, prosper-
ity, and human dignity are not utopian dreams;
they can become practical possibilities for all
nations.

But the economic system which we labored so
hard to construct is now under stress. The energy
crisis of 1973 first dramatized the forces of change
which threaten to outrun our capacity for coopera-
tive action. A food crisis, a global recession, and a
rate of inflation unprecedented in the postwar
period have further strained the structure of inter-
national cooperation. At the same time, the poorer
nations have increasingly pressed their demands for
greater benefits and more participation in the inter-
national system.

Economic expansion in the industrial world
and economic cooperation with the less-developed
countries go hand in hand. Only economic growth
can satisfy competing demands for more income
and more opportunity within, and among, coun-

tries. An expanding world economy is essential for
development. It stimulates trade, investment, and
technology; it supports necessary bilateral and mul-
tilateral aid programs; it assures growing markets
for the raw materials, manufactures, and agricul-
tural products of the developing countries; it pro-
vides the best framework for accommodation on
the difficult and potentially divisive issues of food,
energy, raw materials, trade, and investment.

These issues go far beyond economic consider-
erations. Economic stagnation breeds political in-
stability. For the nations of the industrialized
world, the economic crisis has posed a threat to
much more than our national income. It has
threatened the stability of our institutions and the
fabric of our cooperation on the range of political
and security problems. Governments cannot act
with assurance while their economies stagnate and
they confront increasing domestic and interna-
tional pressures over the distribution of economic
benefit. In such conditions, the ability to act with
purpose—to address either our national or interna-
tional problems—will falter. If they are to contrib-
ute to world security and prosperity, the industri-
alized nations must be economically strong and
politically cohesive.

The Organization for Economic Cooperation
and Development [OECD] reminds us of our
strengths. It calls attention to the widsom of our
predecessors who saw that we multiply our effec-
tiveness by our cooperation. This organization was
originally created to promote cooperation among
those few nations which were already most ad-

PR 302

2

vanced. This is still a worthwhile objective, but today's realities demand that we also increasingly base our policies on the recognition that growth in the industrial world is inextricably linked to our relationship with the rest of the world.

We thus face two important challenges:

* First, the challenge to the nations of the industrial world to restore sustained and stable economic growth, so essential to maintain confidence in their institutions.

* A challenge to all nations to improve the system of international economic cooperation, and thus provide greater opportunity for the less-developed countries to share both the benefits and responsibilities of a growing world economy.

## Growth Among the Industrialized Nations

The industrialized nations are now experiencing the most serious economic crisis since the great depression of the thirties. We see it in widespread recession. We encounter it in the inflation that has become the bane of our societies. We note it in the increasing difficulty of governments to manage their economies and even to control their budgets. We observe it in the declining incentives to investment that many of the industrial democracies are willing to offer.

We see now how much all our social and economic objectives depend on the general trend of prosperity. A democratic society thrives on a political and social consensus. The distribution of economic benefit must be broadly accepted as just or as offering opportunity for those who seek it. Otherwise, escalating wage and price demands, lagging work performance, and labor unrest will undermine productivity; and inflation, which destroys growth and shatters hope, will be the arbiter of social priorities. Stagnation magnifies all our difficulties; stable growth enhances our possibilities.

The Finance Ministers, meeting tomorrow, will discuss specific measures to achieve our goal. Secretary [of the Treasury William E.] Simon will then describe in detail the trend of American economic recovery. Today, let me offer some general propositions about our long-term future.

Our first task is to rebuild confidence through decisive, coordinated, and mutually supportive action to promote sustained expansion. We must recognize, especially in the short- and medium-term

management of our economies, that the economic policies of one nation can have a profound impact on others. And the United States, because of the size and impact of its economy, has a particular obligation to recognize the magnitude of its responsibility.

In the past we have kept each other informed on short-term policy measures. In a new departure this past winter, President Ford consulted with Chancellor [of the Federal Republic of Germany Helmut] Schmidt, Prime Minister [of the United Kingdom Harold] Wilson, President [of France Valery] Giscard d'Estaing, and former Prime Minister [of Japan Kakuei] Tanaka on our efforts to combat the recession. The major industrial countries need to do so. It will greatly improve the chances of avoiding the sequence of boom and bust experienced these last 3 years. The United States is prepared to cooperate fully in such efforts.

Second, we must collaborate to sustain the growth of international trade and investment. The great postwar effort to liberalize trade, to lessen barriers to investment, and to maintain free monetary exchanges has nourished our prosperity over a generation. Trade has consistently expanded at a rate twice that of our domestic economy. We must carry this momentum forward in the OECD by renewing our pledge not to resort to restrictive trade measures to cover deficits resulting from current world economic difficulties. And we must take advantage of the multilateral trade negotiations to lower tariffs and nontariff barriers and improve the world trading system.

Third, as I outlined yesterday in the IEA [International Energy Agency], we must collectively adopt strong national and international policies on energy conservation and the development of alternative energy sources. This is indispensable if we are to lower prices and inhibit the political exploitation of a scarce resource. We must end, or at least reduce, the vulnerability of our economies to external economic or political manipulation.

Finally, we must develop longer term growth strategies by systematically addressing some fundamental questions:

* How can the industrial nations bring about the massive capital formation required over the

3

next decade for an adequate rate of growth and for
a new quality of life?

* What policies are needed to restore a non-inflationary environment without which long-term growth cannot occur?

* How can we encourage the research and development necessary to advance the technology vital to growth and to share it with others?

To begin the search for answers to such ques-
tions, I propose that we constitute a special group
of distinguished economists both in and out of gov-
ernment. Their purpose should be to identify
measures that OECD nations can adopt to assure
long-term growth. This group should draw on the
projections now being developed within the
Economic Policy Committee [of the OECD] and
turn them into policy recommendations for the
next ministerial meeting.

The importance of our economic cooperation transcends immediate economic utility; it also fosters our sense of community and common interest. If we are to cooperate in times of political and military crisis, we cannot, in calmer periods, afford to be economically weak or disunited or preoccupied with clashing economic interests. The interrelationship of our political, economic, and security interests—which the United States suggested 2 years ago—is a fact, not a theory.

Moreover, eased relations with the Commu-
nist world presuppose the political unity and
economic vitality of the industrialized countries.
The East's incentive to play a responsible role in
the world economy and to improve political rela-
tionships with the industrialized nations will be en-
hanced as its stake in our economic success grows.
This has been one of the more hopeful trends of
recent years, and it is up to us to assure its
continuation.

Cooperation With the Developing Nations

Let me now turn to another crucial issue—the
relationship between the industrialized nations and
the developing world.

The world's prosperity will depend primarily
on the industrialized nations, since we account for
65 percent of the world's output and 70 percent of
world trade. But our economic well-being depends on
structure of international cooperation in which
the developing countries are, and perceive them-

selves to be, participants. The new problems of our
era—insuring adequate supplies of food, energy,
and raw materials—require a world economy that
accommodates the interests of developing as well
as developed countries.

We in this organization all face the same
challenge, and we must face it together. The
political evolution and economic growth of the last
30 years have brought about a new diffusion of
power. No nation or bloc can dominate any longer.
Economic issues are turning into central political
issues.

Thus it has become a central test of states-
manship to insure the orderly reconciliation of
conflicting interests and to prevent a slide into
political and economic warfare. Misused economic
power—as the past 2 years have borne stark
witness—can reverse the trend of worldwide growth
and retard progress for everyone. An international
system will be stable only so long as its economic
benefits are widely shared and its arrangements are
perceived as just. The United States and, I am sure,
all of us in this room are ready to seek solutions to
the problems of international cooperation with
imagination and compassion.

But it is evident that others must be ready to
follow a similar course. Confrontation and coop-
eration cannot be carried on simultaneously. Inter-
national meetings that exhaust themselves in self-
indulgent rhetoric or self-righteous propaganda
help no one and no cause. We do not consider it
constructive to participate in such exercises; we
have a clear interest in resisting bloc pressure
tactics or attempts to impose solutions through
hostility. Such methods are futile and counter-
productive. If the terribly complex issues before us
are to be resolved through tests of strength, it is
not the advanced industrial powers who will pay
the highest price. Instead, it will be the poorest and
most disadvantaged—those in whose name and for
whose benefit these tactics are purportedly used.

It is time to end the theoretical debate over
whether we are seeking a new order or improving
the existing one. Let us deal in reality, not rheto-
ric. Let us address the practical, common concerns
of all the world's peoples with realism, maturity,
mutual understanding, and common sense. The
United States welcomes a dialogue in that spirit.
We will do all we can to make it succeed.

Simple labels falsify the many real commu-

4

nities of interest which exist—some overlapping, some competitive, some complementary. One of the striking features of the modern world economy is the diversity of its participants. Among the countries formerly classed as "developing," there have emerged in the last decade new economic powers with a growing capacity to export manufactures and raw materials. The most successful have fostered investment and growth at home. To these emerging powers have now been added the oil-rich countries. Any nation with a moral claim to world leadership—we as well as the newly wealthy—must contribute to easing the plight of the poorest countries. For who can deny that every economic problem—stagnation, inflation, high energy prices, food shortages—hits them hardest?

## Areas for Cooperative Efforts

The United States recognizes the responsibility that accompanies its economic power. We are prepared to do our part, in a spirit of equality, mutual respect, and cooperation. Yesterday [in the IEA] I discussed our proposals for achieving a successful multilateral energy dialogue. Today let me turn to food, raw materials, and trade and finance. A breakdown of the system in these areas would foster economic chaos and instability. Successful collaboration could usher in a new era of economic advance and human progress.

**Food.** The global problems in food are a central moral and political challenge. A world order in which tens of millions starve and millions more are undernourished will never be accepted as just. The good harvests expected this year should not make us complacent, for the world's total food requirements continue to grow dramatically. The gap between what developing countries can produce and what they need currently amounts to about 25 million tons. At current rates of production and population growth, that gap is expected to double or triple in 10 years. Unless we act now, the world may face a series of increasingly unmanageable food crises over the next quarter century.

For the short term, food aid will continue to be vital to feed the victims of poverty and natural disaster. It is an international responsibility—to be shared by all financially able countries. The United States has pledged that it will make every effort to provide at least 4 million tons of food aid annually.

But this will not be enough. A long-term solution to the food problem requires that:

* World food production capacity be greatly increased, especially in the developing countries; and

* An international system of grain reserves be created.

Let me turn to the U. S. proposals in these area.

Fortunately, the less-developed nations which are in greatest need also have the greatest potential for increased production. They possess large quantities of unused water and cultivatable land and the greatest possibility for improvement in crop yields. Their success, however, requires vast amounts of capital, new methods of planning and funding, and more effective agricultural policies and practices.

To these ends, the United States supports two new international mechanisms:

* First, the International Fund for Agricultural Development. This fund, proposed by the producing nations, is designed to bring together nations who are prepared to contribute additional resources, over some agreed base year, to agricultural developments. President Ford has asked me to announce that the United States will participate in the creation of such a fund. We believe its resources should total at least $1,000 million a year.

* The link between funding and effective agricultural development strategies should be provided by a second organization, the Consultative Group on Food Production and Investment, which has already been organized as a result of the World Food Conference. This group-sponsored by the World Bank [International Bank for Reconstruction and Development-IBRD], the U. N. Development Fund, and the Food and Agriculture Organization-plans its first meeting in July. It should be the central mechanism for cooperation among traditional donors, new donors, and the developing countries.

A crucial element in a long-term food strategy is grain reserves. Short-term fluctuations in food production, due to weather or natural or other catastrophes, cause sharp swings in price and availability of precious grains and cause plagues of

5

starvation. A system of grain reserves would make it possible to alleviate famine in bad years, as well as reduce pressures on supply and markets.

At the Rome food conference [November 1974] we agreed to negotiate a new international system of nationally held grain reserves. I recently outlined the suggested principles for such a system which the United States is prepared to begin negotiating immediately:

* First, total world reserves must be large enough to meet potential shortfalls in food grains production.

* Second, grain exporters and importers should agree on a fair allocation of reserve holdings, taking into account wealth, productive capacity, and volume of trade.

* Third, there should be agreed international rules or guidelines to encourage members to build up reserves in times of good harvest.

* Fourth, each participating country should be free to determine how its reserves will be maintained and what incentives will be provided for their buildup and maintenance.

* Fifth, rules or guidelines should be agreed for the drawdown of reserves, triggered by shortfalls in world production. There must be a clear presumption that all members will make reserves available when needed and, conversely, that reserves will not be released prematurely or excessively, thereby depressing market prices.

* Sixth, in times of shortage the system must assure access to supplies for participating countries.

* Seventh, there must be special provisions to meet the needs of the poorer countries.

* Finally, the system must encourage expanded and liberalized trade in grains.

The United States is prepared to hold an important part of an agreed level of world reserves. If others join us, agreement on the outlines of a reserve system can be achieved before the end of the year.

**Raw Materials.** A second area of increasing concern is commodities. The time is ripe for a detailed look at problems of commodity trade—for solutions that will benefit producers and consumers alike. The current system is marked by volatile prices, disruption of supplies, investment

disputes, and increasing hostility to the private capital investment which remains indispensable for the transfer of resources and management skills.

Thus consumers as well as producers have an interest in effective arrangements. The consuming nations seek reliable supplies and prices. The producing countries seek reliable and growing export earnings to finance development and an adequate return on investments. All nations share an interest in ending the friction which characterizes the issue of raw materials. The debate is becoming more polarized and has already damaged other efforts for international cooperation. The failure of the preparatory energy conference last month [held April 7-15 in Paris] is but a symptom of the larger problem we now confront. The longer we delay, the more difficult and painful it will be to find solutions.

The United States offers the following suggestions:

* First, we propose that new rules and procedures for access to markets and supplies be negotiated in the multilateral trade negotiations now taking place in Geneva.

* Second, we do not believe that exclusive producers' organizations are the best way to solve the commodity problem. In our view consumers and producers should jointly discuss their problems and possible remedial actions. We are prepared to do so. Specifically we are ready to discuss new arrangements for individual commodities on a case-by-case basis. We have already made proposals for a new International Coffee Agreement. We are ready to discuss other commodities as circumstances warrant.

* Third, I have recently suggested that the World Bank increase its financing of resource investments and explore new ways of combining its financing with private management, skills, technology, and capital.

* Finally, for most less-developed countries the key issue is the need for reliable, long-term stability and growth in export earnings. Proposals have been made to review mechanisms for the stabilization of earnings, notably those of the IMF [International Monetary Fund], to protect the developing countries against excessive fluctuations in their export income. We are prepared to join others in this effort.

6

Others here will have their own views on how to proceed and on new ways of addressing the concerns of the developing nations. Cooperative action among the industrialized nations will multiply the effectiveness of our individual efforts and will insure that we have a clear understanding of common needs. The United States, therefore, strongly supports the OECD recommendation of a high-level group to study proposals on commodities.

**Trade and Finance.** The traditional areas of international economic cooperation—trade and finance—remain central elements of the economic structure. We cannot adequately provide for new areas of cooperation unless we first assure that the trading and monetary system is functioning effectively. While the present system has come through the last few years quite well, two problems stand out:

* First, developing countries with large and growing industrial sectors, particularly in East Asia and Latin America, require expanding markets for their manufactured goods. We urge the developing countries to approach the issue with the same attitude. We must all realize that the actual diversity of parties and interests demands a variety of responses, that no single solution can be adequate, and that cooperation among the parties most concerned is the most effective means of addressing common problems.

* Second, the poorest countries are badly in need of additional financial help. They now bear a double burden of higher prices for imported energy, food, fertilizer, and industrial goods and of reduced export earnings due to worldwide recession. We therefore support the creation by 1976 of a special trust fund of up to $2,000 million under the IMF. We have proposed that gold now held by the IMF be supplemented by other contributions—especially from oil producers—and be used to provide resources for half of this total. I hope that the countries of the OECD could put this proposal forward for action at the meetings of the IMF interim committee and IMF/IBRD Development Committee 2 weeks from now.

In short, we propose to base the relationship between developed and developing nations on a spirit of cooperation and good will. We urge the

developing countries to approach the issue with the same spirit. We must all realize that the actual diversity of parties and interests demands a variety of responses, that no single solution can be adequate, and that cooperation among the parties most concerned is the most effective means of addressing consumer problems.

The United States welcomes the [OECD] Secretary General's proposal for a comprehensive review of our economic relationships with developing countries. We also support the proposal of the Government of Japan for a major study, within the OECD, of the longer run development of the advanced industrial societies in harmony with the less-developed countries.

It is not often in history that a fundamental challenge is so clearly visible and presents such an opportunity to shape our future. We are summoned to seize the possibilities inherent in the new era which the whole world is now entering. We should be confident and not timid; others are seeking to join in what we have built. Our challenge is to encourage progress and not abstract ideological confrontation. With this attitude we can look forward with optimism to the major international deliberations before us, such as the Seventh Special Session of the U. N. General Assembly this fall.

## Conclusion

Politically, as well as economically, our era has been shaped by the Industrial Revolution and the progressive economic growth that it brought. Its impact has been rapid, its results prodigious, its effects remarkable. It has created a new age of well-being and helped rapid economic growth, which was confined to Western Europe and the United States a century ago, expand into many parts of the globe.

At home, this economic progress has been an essential underpinning of our democracies. It is the basis of a stable, progressive, and just political and social environment.

The new nations now striving to industrialize have with our help a similar opportunity. We have every reason to expect similar success in working together with them on the new challenges of food, raw materials, and energy. But progress will happen automatically.

So a great deal depends on our determination

(cc)

line. So we would oppose an oil price in-
crease, and we hope that the OPEC countries
will reflect further on the impact on the
world economy of a continual increase in oil
prices.

Q. [Inaudible. In substance asks why the Secretary did not mention the U.N. Conference on Trade and Development in his IEA speech, and if he opposes an UNCTAD role in dealing with the commodity problem.]

Secretary Kissinger: With respect to com-
modities? These are the specific proposals
that we have put forward. We are prepared
to examine other forums where this might
be considered.

Q. Mr. Secretary, you spoke at the outset of developing a kind of architecture to structure the world as we can see it develop. In your talks this morning with the French President, did you find him looking at the same structure, or did he have a housing plan of his own?

Secretary Kissinger: Well, I think that France prides itself on its independent foreign policy. Obviously, we have no objections to France having an independent foreign policy. On the whole my impression was of a considerable mutuality of approach. There could be occasional differences in tactics. There might be a difference in emphasis, but I thought on the overall approach that the talks were very satisfactory and were conducted in a very constructive and positive atmosphere.

Q. Mr. Secretary, I notice that there is some change in the time frame; when you spoke this morning, I believe it was "a month," and now you are speaking of "a few months."

Secretary Kissinger: It could be a question of my accent—that you did not hear the "s." Nothing has changed between what I said this morning and what I said this afternoon. We are prepared to begin discussions immediately. We are in discussions now with our IEA partners. We will be discussing in the near future after conclusions have been reached with the Government of France and will continue exploratory talks with the

producers. We have no reason to hold up
the resumption of the preparatory confer-
ence. Sometime in the next months, with an
"s" at the end; and that's what I intended
to say this morning.

Q. Following President Ford's discussion with President Sadat in Salzburg and Prime Minister Rabin in Washington, do you plan to go back to the area for a new shuttle diplomacy?

Secretary Kissinger: Well, the method of the diplomacy is not what is crucial, and it depends, of course, on what progress is made and toward what particular end. The United States has not excluded any particular approach. On the contrary, we are prepared to pursue any approach that makes progress toward peace. We have excluded a stalemate of any duration. So in principle we are prepared to be helpful in whatever direction the parties concerned believe would be most useful to them.

STATEMENT BEFORE THE MINISTERIAL
COUNCIL OF THE OECD, MAY 28,

1975

Press release 302 dated May 28

This organization embodies the legacy and
the hope of the Marshall plan, one of the
most creative achievements of international
collaboration. The nations represented here
have every reason to be proud of the ad-
vances which they have achieved for their
peoples during the past 30 years. Our prog-
ress has fostered global progress. Our suc-
cess has demonstrated that hope, prosperity,
and human dignity are not utopian dreams;
they can become practical possibilities for
all nations.

But the economic system which we labored
so hard to construct is now under stress.
The energy crisis of 1973 first dramatized
the forces of change which threaten to out-
run our capacity for cooperative action. A
food crisis, a global recession, and a rate of
inflation unprecedented in the postwar pe-

June 23, 1975

849

riod have further strained the structure of
international cooperation. At the same time,
the poorer nations have increasingly pressed
their demands for greater benefits and more
participation in the international system.

Economic expansion in the industrial
world and economic cooperation with the
less developed countries go hand in hand.
Only economic growth can satisfy competing
demands for more income and more oppor-
tunity within and among countries. An ex-
panding world economy is essential for de-
velopment. It stimulates trade, investment,
and technology; it supports necessary bi-
lateral and multilateral aid programs; it
assures growing markets for the raw ma-
terials, manufactures, and agricultural prod-
ucts of the developing countries; it provides
the best framework for accommodation on
the difficult, potentially divisive issues of
food, energy, raw materials, trade, and in-
vestment.

These issues go far beyond economic con-
siderations. Economic stagnation breeds
political instability. For the nations of the
industrialized world, the economic crisis has
posed a threat to much more than our na-
tional income. It has threatened the stability
of our institutions and the fabric of our
cooperation on the range of political and
security problems. Governments cannot act
with assurance while their economies stag-
nate and they confront increasing domestic
and international pressures over the distri-
bution of economic benefit. In such condi-
tions, the ability to act with purpose—to
address either our national or international
problems—will falter. If they are to con-
tribute to world security and prosperity, the
industrialized nations must be economically
strong and politically cohesive.

The Organization for Economic Coopera-
tion and Development reminds us of our
strengths. It calls attention to the wisdom
of our predecessors, who saw that we multi-
ply our effectiveness by our cooperation.
This organization was originally created to
promote cooperation among those few na-
tions which were already most advanced.
This is still a worthwhile objective, but to-
day's realities demand that we also increas-

ingly base our policies on the recognition
that growth in the industrial world is inex-
tricably linked to our relationship with the
rest of the world.

- First, the challenge to the nations of the industrial world to restore sustained and stable economic growth, so essential to maintain confidence in their institutions.

- A challenge to all nations to improve the system of international economic cooperation, and thus provide greater opportunity for the less developed countries to share both the benefits and responsibilities of a growing world economy.

The industrialized nations are now experi-
encing the most serious economic crisis since
the Great Depression of the thirties. We
see it in widespread recession. We encounter
it in the inflation that has become the bane
of our societies. We note it in the increasing
difficulty of governments to manage their
economies and even to control their budgets.
We observe it in the declining incentives to
investment that many of the industrial de-
mocracies are willing to offer.

We see now how much all our social and
economic objectives depend on the general
trend of prosperity. A democratic society
thrives on a political and social consensus.
The distribution of economic benefit must be
broadly accepted as just or as offering op-
portunity for those who seek it. Otherwise
escalating wage and price demands, lagging
work performance, and labor unrest will un-
dermine productivity; and inflation, which
destroys growth and shatters hope, will be
the arbiter of social priorities. Stagnation
magnifies all our difficulties; stable growth
enhances our possibilities.

The Finance Ministers, meeting tomorrow,
will discuss specific measures to achieve our
goal. Secretary Simon will then describe in
detail the trend of American economic re-
covery. Today, let me offer some general
propositions about our long-term future.

Our first task is to rebuild confidence
through decisive, coordinated, and mutually
supportive action to promote sustained ex-
pansion. We must recognize, especially in

850

Department of State Bulletin

the short- and medium-term management of
our economies, that the economic policies of
one nation can have a profound impact on
others. And the United States, because of
the size and impact of its economy, has a
particular obligation to recognize the mag-
nitude of its responsibility.

In the past we have kept each other in-
formed on short-term policy measures. In
a new departure, this past winter President
Ford consulted with Chancellor Schmidt [of
the Federal Republic of Germany], Prime
Minister Wilson [of the United Kingdom],
President Giscard d'Estaing [of France],
and former Prime Minister Tanaka [of
Japan] on our efforts to combat the reces-
sion. The major industrial countries need to
do so. It will greatly improve the chances
of avoiding the sequence of boom and bust
experienced these last three years. The
United States is prepared to cooperate fully
in such efforts.

Second, we must collaborate to sustain the
growth of international trade and invest-
ment. The great postwar effort to liberalize
trade, to lessen barriers to investment, and
to maintain free monetary exchanges has
nourished our prosperity for over a genera-
tion. Trade has consistently expanded at a
rate twice that of our domestic economy.
We must carry this momentum forward in
the OECD by renewing our pledge not to
resort to restrictive trade measures to cover
deficits resulting from current world eco-
nomic difficulties. And we must take advan-
tage of the multilateral trade negotiations
to lower tariffs and nontariff barriers and
improve the world trading system.

Third, as I outlined yesterday in the IEA,
we must collectively adopt strong national
and international policies on energy conser-
vation and the development of alternative
energy sources. This is indispensable if we
are to lower prices and inhibit the political
exploitation of a scarce resource. We must
end, or at least reduce, the vulnerability of
our economies to external economic or politi-
cal manipulation.

Finally, we must develop longer term
growth strategies by systematically address-
ing some fundamental questions:

- How can the industrial nations bring about the massive capital formation required over the next decade for an adequate rate of growth and for a new quality of life?

- What policies are needed to restore a noninflationary environment, without which long-term growth cannot occur?

- How can we encourage the research and development necessary to advance the technology vital to growth and to share it with others?

To begin the search for answers to such
questions, I propose that we constitute a
special group of distinguished economists
both in and out of government. Their pur-
pose should be to identify measures that
OECD nations can adopt to assure long-
term growth. This group should draw on
the projections now being developed within
the Economic Policy Committee and turn
them into policy recommendations for the
next ministerial meeting.

The importance of our economic coopera-
tion transcends immediate economic utility;
it also fosters our sense of community and
common interest. If we are to cooperate in
times of political and military crisis, we
cannot, in calmer periods, afford to be eco-
nomically weak, or disunited, or preoccupied
with clashing economic interests. The inter-
relationship of our political, economic, and
security interests which the United States
suggested two years ago is a fact, not a
theory.

Moreover, eased relations with the Com-
unist world presuppose the political unity
and economic vitality of the industrialized
countries. The East's incentive to play a re-
sponsible role in the world economy and to
improve political relationships with the in-
dustrialized nations will be enhanced as its
stake in our economic success grows. This
has been one of the more hopeful trends of
recent years and it is up to us to assure its
continuation.

Let me now turn to another crucial issue:
the relationship between the industrialized
nations and the developing world.

June 23, 1975

851

The world's prosperity will depend pri-
marily on the industrialized nations since we
account for 65 percent of the world's output
and 70 percent of its trade. But our eco-
nomic well-being depends on a structure of
international cooperation in which the de-
veloping countries are, and perceive them-
selves to be, participants. The new prob-
lems of our era—insuring adequate supplies
of food, energy, and raw materials—require
a world economy that accommodates the in-
terests of developing as well as developed
countries.

We in this organization all face the same
challenge, and we must face it together.
The political evolution and economic growth
of the last 30 years have brought about a
new diffusion of power. No nation or bloc
can dominate any longer. Economic issues
are turning into central political issues. Thus
it has become a central test of statesman-
ship to insure the orderly reconciliation of
conflicting interests and to prevent a slide
into political and economic warfare. Mis-
used economic power—as the past two years
have borne stark witness—can reverse the
trend of worldwide growth and retard prog-
ress for everyone. An international system
will be stable only so long as its economic
benefits are widely shared and its arrange-
ments are perceived as just. The United
States, and I am sure all of us in this room,
are ready to seek solutions to the problems
of international cooperation with imagina-
tion and compassion.

But it is evident that others must be ready
to follow a similar course. Confrontation
and cooperation cannot be carried on simul-
taneously. International meetings that ex-
haust themselves in self-indulgent rhetoric
or self-righteous propaganda help no one
and no cause. We do not consider it construc-
tive to participate in such exercises; we have
a clear interest in resisting bloc pressure tac-
tics or attempts to impose solutions through
hostility. Such methods are futile and counter-
productive. If the terribly complex issues
before us are to be resolved through tests
of strength, it is not the advanced industrial
powers who will pay the highest price. In-
stead, it will be the poorest and most dis-

It is time to end the theoretical debate
over whether we are seeking a new order or
improving the existing one. Let us deal in
reality, not rhetoric. Let us address the prac-
tical common concerns of all the world's
peoples with realism, maturity, mutual un-
derstanding, and common sense. The United
States welcomes a dialogue in that spirit.
We will do all we can to make it succeed.

Simple labels falsify the many real com-
munities of interest which exist—some over-
lapping, some competitive, some comple-
mentary. One of the striking features of
the modern world economy is the diversity
of its participants. Among the countries
formerly classed as "developing," there have
emerged in the last decade new economic
powers with a growing capacity to export
manufactures and raw materials. The most
successful have fostered investment and
growth at home. To these emerging powers
have now been added the oil-rich countries.
Any nation with a moral claim to world
leadership—we as well as the newly wealthy
—must contribute to easing the plight of
the poorest countries. For who can deny
that every economic problem—stagnation,
inflation, high energy prices, food shortages
—hits them hardest?

The United States recognizes the responsi-
bility that accompanies its economic power.
We are prepared to do our part, in a spirit
of equality, mutual respect, and cooperation.
Yesterday I discussed our proposals for
achieving a successful multilateral energy
dialogue. Today let me turn to food, raw
materials, and trade and finance. A break-
down of the system in these areas would
foster economic chaos and instability. Suc-
cessful collaboration could usher in a new era
of economic advance and human progress.

Food—A Moral and Political Challenge

The global problems in food are a central
moral and political challenge. A world order
in which tens of millions starve and millions
more are undernourished will never be ac-

852

Department of State Bulletin

But this will not be enough. A long-term solution to the food problem requires that world food production capacity be greatly increased, especially in the developing countries, and an international system of grain reserves be created.

Let me turn to the U.S. proposals in these areas.

Fortunately, the less developed nations which are in greatest need also have the greatest potential for increased production. They possess large quantities of unused water and cultivatable land and the greatest possibility for improvement in crop yields. Their success, however, requires vast amounts of capital, new methods of planning and funding, and more effective agricultural policies and practices.

First, the International Fund for Agricultural Development—this Fund, proposed by the oil-producing nations, is designed to bring together all nations who are prepared to contribute additional resources, over some agreed base year, to agricultural development. President Ford has asked me to announce that the United States will participate in the creation of such a fund. We believe its resources should total at least $1,000 million a year.

The link between funding and effective agricultural development strategies should be provided by a second organization, the Consultative Group on Food Production and Investment, which has already been organized as a result of the World Food Conference. This Group, sponsored by the World Bank [International Bank for Reconstruction and Development (IBRD)], the U.N. Development Program, and the Food and Agriculture Organization, plans its first meeting in July. It should be the central mechanism for cooperation among traditional donors, new donors, and the developing countries.

A crucial element in a long-term food strategy is grain reserves. Short-term fluctuations in food production, due to weather or natural or other catastrophes, cause sharp swings in price and availability of precious grains and cause plagues of starvation. A system of grain reserves would make it possible to alleviate famine in bad years as well as reduce pressures on supply and markets.

At the Rome Food Conference we agreed to negotiate a new international system of nationally held grain reserves. I recently outlined the suggested principles for such a system which the United States is prepared to begin negotiating immediately:

- First, total world reserves must be large enough to meet potential shortfalls in food-grains production.

- Second, grain exporters and importers should agree on a fair allocation of reserve holdings, taking into account wealth, productive capacity, and volume of trade.

- Third, there should be agreed international rules or guidelines to encourage members to build up reserves in times of good harvest.

- Fourth, each participating country should be free to determine how its reserves will be maintained and what incentives will be provided for their buildup and maintenance.

- Fifth, rules or guidelines should be agreed for the drawdown of reserves, triggered by shortfalls in world production. There must be a clear presumption that all members will make reserves available when

June 23, 1975

853

—Sixth, in times of shortage the system must assure access to supplies for participating countries.

—Seventh, there must be special provisions to meet the needs of the poorer countries.

—Finally, the system must encourage expanded and liberalized trade in grains.

## Commodity Issues, Trade, and Finance

Thus consumers as well as producers have an interest in effective arrangements. The consuming nations seek reliable supplies and prices. The producing countries seek reliable and growing export earnings to finance development and an adequate return on investments. All nations share an interest in ending the friction which characterizes the issue of raw materials. The debate is becoming more polarized and has already damaged other efforts for international cooperation. The failure of the preparatory energy conference last month is but a symptom of the larger problem we now confront. The longer we delay, the more difficult and painful it will be to find solutions.

—First, we propose that new rules and procedures for access to markets and supplies be negotiated in the multilateral trade nego-

—Second, we do not believe that exclusive producers organizations are the best way to solve the commodity problem. In our view consumers and producers should jointly discuss their problems and possible remedial actions. We are prepared to do so. Specifically we are ready to discuss new arrangements for individual commodities on a case-by-case basis. We have already made proposals for a new International Coffee Agreement. We are ready to discuss other commodities as circumstances warrant.

—Third, I have recently suggested that the World Bank increase its financing of resource investments and explore new ways of combining its financing with private management, skills, technology, and capital.

—Finally, for most less developed countries, the key issue is the need for reliable long-term stability and growth in export earnings. Proposals have been made to review mechanisms for the stabilization of earnings, notably that of the IMF [International Monetary Fund] to protect the developing countries against excessive fluctuations in their export income. We are prepared to join others in this effort.

Others here will have their own views on how to proceed and on new ways of addressing the concerns of the developing nations. Cooperative action among the industrialized nations will multiply the effectiveness of our individual efforts and will insure that we have a clear understanding of common needs. The United States therefore strongly supports the OECD recommendation of a high-level group to study proposals on commodities.

The traditional areas of international economic cooperation, trade and finance, remain central elements of the economic structure. We cannot adequately provide for new areas of cooperation unless we first assure that the trading and monetary system is functioning effectively. While the present system has come through the last few years quite well, two problems stand out:

—First, developing countries with large and growing industrial sectors, particularly in East Asia and Latin America, require

854

Department of State Bulletin

expanding markets for their manufactured goods. The Tokyo Declaration's pledge to provide improved access to industrial world markets for developing countries must be implemented urgently for these countries.² And they should be given an opportunity to participate in the negotiations.

—Second, the poorest countries are badly in need of additional financial help. They now bear a double burden of higher prices for imported energy, food, fertilizer, and industrial goods and of reduced export earnings due to worldwide recession. We therefore support the creation by 1976 of a special trust fund of up to $2,000 million under the IMF. We have proposed that gold now held by the IMF be supplemented by other contributions, especially from oil producers, and be used to provide resources for half of this total. I hope that the countries of the OECD could put this proposal forward for action at the meetings of the IMF Interim Committee and IMF-IBRD Development Committee two weeks from now.

In short, we propose to base the relationship between developed and developing nations on a spirit of cooperation and good will. We urge the developing countries to approach the issue with the same attitude. We must all realize that the actual diversity of parties and interests demands a variety of responses, that no single solution can be adequate, and that cooperation among the parties most concerned is the most effective means of addressing common problems.

The United States welcomes the Secretary General's proposal for a comprehensive review of our economic relationships with developing countries. We also support the proposal of the Government of Japan for a major study within the OECD of the longer run development of the advanced industrial societies in harmony with the less developed countries.

presents such an opportunity to shape our future. We are summoned to seize the possibilities inherent in the new era which the whole world is now entering. We should be confident and not timid; others are seeking to join in what we have built. Our challenge is to encourage progress and not abstract ideological confrontation. With this attitude, we can look forward with optimism to the major international deliberations before us such as the seventh special session of the U.N. General Assembly this fall.

Politically as well as economically, our era has been shaped by the Industrial Revolution and the progressive economic growth that it brought. Its impact has been rapid, its results prodigious, its effects remarkable. It has created a new age of well-being and helped rapid economic growth, which was confined to Western Europe and the United States a century ago, expand into many parts of the globe.

The new nations now striving to industrialize have, with our help, a similar opportunity. We have every reason to expect similar success in working together with them on the new challenges of food, raw materials, and energy. But progress will not happen automatically.

So a great deal depends on our determination and vision. There are no plateaus in the affairs of mankind. What is not a step forward is at best stagnation; more often, it is a pause before retreat. There is no need to be dismayed by the problems we face, for progress implies problems. Circumstances have already provided the nations of the world with a unique perception of their interdependence. The opportunity to write a new and enduring chapter in the story of international cooperation is up to us.

We are prepared to respond to the imperatives we face. We have the awareness, the tools, and the determination. Let us now resolve to build the new era that our times demand.

²For text of the declaration, approved at Tokyo on Sept. 14, 1973, by a ministerial meeting of the Contracting Parties to the General Agreement on Tariffs and Trade (GATT), see BULLETIN of Oct. 8, 1973, p. 450.

June 23, 1975

855

TEXT OF OECD COMMUNIQUE
AND DECLARATION

COMMUNIQUE

PARIS, 29th May, 1975.

1. The Council of the OECD met at Ministerial level on 28th May, under the chairmanship of the Right Honourable James Callaghan, MP, United Kingdom Secretary of State for Foreign and Commonwealth Affairs, and on 29th May, with the Right Honourable Denis Healey, MBE, MP, United Kingdom Chancellor of the Exchequer, in the chair.

The Economic Situation

2. Ministers expressed confidence that the policies of OECD governments will lead to a recovery of demand and employment and that this will be combined with further reductions in the average rate of inflation. They are determined to achieve these goals, and to ensure, by timely adjustments of policies, that the recovery is under-pinned should this prove necessary, and that, once under way, it does not degenerate into a new period of excessive demand pressures and inflationary tendencies. Ministers noted that the substantial international payments deficit on current account of OECD countries as a group, which has recently declined, is nevertheless likely to persist for some years. They also underlined the importance of ensuring that economic policies are such as to secure, among OECD countries, a less unbalanced distribution of current account positions, more compatible with a sustainable pattern of capital flows. Given such policies, Ministers were confident that, backed by official bilateral and multilateral arrangements, the financing of existing and prospective deficits could be continued on an orderly basis; in this connection they welcomed the steps being taken to obtain early ratification of the agreement establishing the OECD Financial Support Fund.

3. Ministers stressed that policy decisions concerned with the immediate future had to be related to the foreseeable medium and longer-term problems of structural change, and to broad strategies for resolving them. Ministers agreed that the OECD should carry forward and accelerate its re-assessment of the prospects for sustained economic growth and the constraints on such growth, particularly those arising from inflation, under the changing circumstances. They noted with interest the proposal made by the United States Government that a number of economists of international repute should be invited, drawing on this work, to examine the policy issues and make recommendations. In a broader and longer run context, Ministers also noted with interest a proposal initiated by the Japanese Government for a study of the future development of advanced industrial societies in harmony with that of developing countries.

Trade

4. Ministers³ decided to renew, for a further period of one year, the Declaration adopted on 30th May, 1974, stating the determination of all OECD governments to avoid recourse to new restrictions on trade and other current account transactions and the artificial stimulation of visible and current invisible exports. In renewing the Declaration, Ministers stressed that the present situation required a high degree of economic co-operation. Noting that there had been a marked difference in the balance-of-payments situations of OECD Member countries, they welcomed the economic measures taken by certain of them; and they reaffirmed that, in the present state of the world economy, it remained of the highest importance to follow an economic policy which combatted inflation but also aimed at maintaining a high level of employment and expansion of world trade. The way in which this policy should be implemented must take account of the respective situations of Member countries.

5. Ministers agreed that, given the importance of the terms of export credits in international competition, an arrangement of a general nature in this respect, between as many as possible of the industrialised countries of the OECD, should be achieved. This would constitute significant progress in international co-operation. They also agreed on the need to continue close consultations on exchange-rate developments in the appropriate bodies. They noted that the problems of the developing Member countries have become more serious in several respects during the past year, and deserve to be considered with special attention within the OECD.

6. Ministers reaffirmed that liberal and expanded trade was of the utmost importance for the further development of the world economy and that, to this end, they would work together for the success of the multilateral trade negotiations now under way.

Energy

7. Ministers stressed the importance they attached to continuing and developing co-operation in the field of energy. A report from the Belgian Foreign Minister, Mr. Renaat van Elslande, Chairman of the Governing Board of the International Energy Agency's meeting at Ministerial level on 27th May, described the progress being made and the new impulse given to energy co-operation within that body.

8. Ministers agreed that increased co-operation between producer and consumer countries was needed in order to ensure equitable and stable conditions in the world energy market.

Commodities

9. Ministers stressed that adequate supplies of commodities at equitable and remunerative prices

³ The Government of Portugal is not, at this stage, in a position to renew the Declaration. [Footnote in original.]

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Department of State Bulletin

are essential to the world economy. They recognised the interdependence and common interest of producers and consumers, both developed and developing countries, particularly in relation to the avoidance of excessive fluctuations in commodity markets, as well as the importance attached by producers to assured access to markets and by consumers to secure supplies. These questions, together with other aspects of the commodity problem, are of special concern to the developing countries in making the best possible use of their natural resources to foster economic development.

10. In responding to the concerns of developing countries in the commodity field and while recognising that circumstances vary greatly between commodities or groups of commodities and that this must be taken into account when working out practical arrangements, Ministers agreed on the need for a more active and broadly based approach to commodity problems aiming in particular, at:

- reducing market instability and promoting a better balance between production and consumption, including, where appropriate, through commodity agreements;

- ensuring adequate levels of investment in production of commodities;

- improving and increasing market outlets and local processing of commodities.

In addition, Ministers indicated their readiness to consider improved international mechanisms to stabilize export earnings of developing producing countries.

11. Ministers stressed the need for progress in the various international discussions on grains. In this context they noted that the better agricultural crops expected this year offered the opportunity to begin rebuilding stocks of essential foodstuffs, notably grains, and to ensure greater world food security. Ministers also re-iterated their readiness to contribute to the efforts needed to increase food production in the developing countries.

12. Ministers agreed that these questions should be pursued actively in all appropriate bodies with a view to reaching concrete solutions based on co-operation between producing and consuming countries. They welcomed the establishment of a high level group in the OECD to further develop Member countries' attitudes both on general aspects of their commodity policies and on specific action concerning particular commodities.

### Relations with Developing Countries

13. Ministers adopted an OECD Declaration on Relations with Developing Countries (annexed to this Communiqué). They further agreed on a review within the OECD of economic relations between Member countries and developing countries, with a view to identifying what new and other constructive approaches could be adopted on selected substantive issues, and to giving support and new

impetus to negotiations in other bodies working on specific problems. Ministers invited the ad hoc high-level Group which has been created for this purpose to begin its work as quickly as possible and to submit a preliminary progress report before the end of July 1975.

14. Ministers agreed on the need to continue the dialogue between developed and developing countries. They recognised that, concurrently with the problems of energy and oil, there are other problems such as commodities, including foodstuffs, development questions and the intensified difficulties of the most seriously affected countries, which will have to be tackled with increased vigour in co-operation with all countries concerned. The need for renewed efforts along these lines was a recurring theme throughout the meeting of the OECD Ministers. Ministers expressed the hope that their deliberations will have provided a basis for the resumption at an early date of the dialogue which was initiated in Paris last April.

## OECD DECLARATION ON RELATIONS WITH DEVELOPING COUNTRIES

PARIS, 28th May, 1975.

1. Ministers of OECD Governments meeting in Paris on 28th May, 1975, discussed relations with developing countries and agreed that, in the present situation, the widest measure of international co-operation is required.

2. They considered that while many developing countries have made major progress in their economic and social development, a large number of them have not been in a position to advance sufficiently and many are still faced with extremely severe problems of poverty.

3. Recalling the contribution which their countries have made to further the economic development of the developing countries, Ministers resolved to intensify their efforts to co-operate with these countries in their endeavours to improve the conditions of life of their people and to participate increasingly in the benefits of an improved and expanding world economy.

4. Given the fact of world economic interdependence, they believed that progress could best be made through practical measures which command wide support among all concerned—developed and developing nations alike.

5. They determined to consider policies aimed at strengthening the position of the developing countries in the world economy and expressed their willingness to discuss with the developing countries the relevant issues, with particular emphasis on food production, energy, commodities and development assistance for the most seriously affected countries.

6. They therefore expressed their firm determination to pursue the dialogue with the developing countries, in all appropriate fora, in particular the

June 23, 1975

857

forthcoming Seventh Special Session of the United Nations General Assembly, and in more restricted fora along the lines suggested by the President of the French Republic, in order to make real progress towards a more balanced and equitable structure of international economic relations.

## REMARKS FOLLOWING MORNING SESSION OF OECD MEETING, MAY 28⁴

**Mr. Koppel:** Could you tell us something about the kind of mood you have found among European leaders? What will the President find on his trip?

**Secretary Kissinger:** I think the President will find a very constructive mood of friends wanting to work together and realizing what the fundamentals are.

**Mr. Koppel:** Now, in your speech today you talked about U.S. desire for cooperation, but you also warn against confrontation. Did you find any mood of confrontation?

**Secretary Kissinger:** Not among our European friends. That warning against confrontation was directed against some countries in larger forums such as the United Nations.

**Mr. Koppel:** Do you sense the same spirit of unity within NATO that existed when the Soviet Union was perceived as more of a threat?

**Secretary Kissinger:** Well, it is a different situation, more complicated, as is shown by the fact that this week we are putting so much emphasis on energy and economic co-operation. But I am very encouraged by the atmosphere in these meetings and by the very serious effort everyone is making to find a new basis for a new period of creativity.

**Mr. Koppel:** What will be the principal issues that the President takes up beginning tomorrow before NATO?

**Secretary Kissinger:** He will take up some of the conventional issues, such as security. He will then take up some of the issues that

have been discussed here, namely, the new problems that we are all facing—energy, economic cooperation, relations with the newly developed countries. And he will take up relations with the East, how détente fits into this whole structure.

**Mr. Koppel:** How about the internal problems of NATO—for example, Portugal, the problems between Turkey and Greece?

**Secretary Kissinger:** As you know, he is spending tomorrow morning with the Greek and Turkish Prime Ministers. These are subjects that will come up more in bilateral meetings than in the formal sessions.

## U.S. Condemns Terrorist Murder of American Officers in Iran

### Department Statement¹

The Department of State was deeply distressed to learn of the murder of two U.S. Air Force officers in Tehran today: Col. Paul R. Schaffer, Jr., and Lt. Col. Jack H. Turner.

We deplore and condemn this terrorist act of calculated brutality against American personnel assigned to duties in a country with which we enjoy close and friendly relations. We extend our deepest sympathy to the families of these two officers.

We are also confident that these murders, evidently carried out by a band of professional assassins, do not represent the sentiments of the Iranian people toward Americans serving there. The strong ties between our two countries, reinforced by the Shah's conversations during his recent state visit, remain.

I understand that the Prime Minister and Chief of the Supreme Commander's staff in Tehran have expressed their condolences for these killings.

We have also been assured that the Iranian authorities are launching an investigation to apprehend the murdersers.

⁴ Made in response to questions by Ted Koppel of ABC-TV (text from press release 304A).

¹ Read to news correspondents on May 21 by Robert L. Funseth, Director, Office of Press Relations.

858

Department of State Bulletin

June 23, 1975

849

850

Department of State Bulletin

- How can we encourage the research and
development necessary to advance the tech-
nology vital to growth and to share it with
others?

Moreover, eased relations with the Com-
munist world presuppose the political unity
and economic vitality of the industrialized
countries. The East's incentive to play a re-
sponsible role in the world economy and to
improve political relationships with the in-
dustrialized nations will be enhanced as its
stake in our economic success grows. This
has been one of the more hopeful trends of
recent years and it is up to us to assure its
continuation.

June 23, 1975

851

The world's prosperity will depend primarily on the industrialized nations since we account for 65 percent of the world's output and 70 percent of its trade. But our economic well-being depends on a structure of international cooperation in which the developing countries are, and perceive themselves to be, participants. The new problems of our era—insuring adequate supplies of food, energy, and raw materials—require a world economy that accommodates the interests of developing as well as developed countries.

We in this organization all face the same challenge, and we must face it together. The political evolution and economic growth of the last 30 years have brought about a new diffusion of power. No nation or bloc can dominate any longer. Economic issues are turning into central political issues. Thus it has become a central test of statesmanship to insure the orderly reconciliation of conflicting interests and to prevent a slide into political and economic warfare. Misused economic power—as the past two years have borne stark witness—can reverse the trend of worldwide growth and retard progress for everyone. An international system will be stable only so long as its economic benefits are widely shared and its arrangements are perceived as just. The United States, and I am sure all of us in this room, are ready to seek solutions to the problems of international cooperation with imagination and compassion.

But it is evident that others must be ready to follow a similar course. Confrontation and cooperation cannot be carried on simultaneously. International meetings that exhaust themselves in self-indulgent rhetoric or self-righteous propaganda help no one and no cause. We do not consider it constructive to participate in such exercises; we have a clear interest in resisting bloc pressure tactics or attempts to impose solutions through hostility. Such methods are futile and counterproductive. If the terribly complex issues before us are to be resolved through tests of strength, it is not the advanced industrial powers who will pay the highest price. Instead, it will be the poorest and most disadvantaged—those in whose name and for whose benefit these tactics are purportedly used.

It is time to end the theoretical debate over whether we are seeking a new order or improving the existing one. Let us deal in reality, not rhetoric. Let us address the practical common concerns of all the world's peoples with realism, maturity, mutual understanding, and common sense. The United States welcomes a dialogue in that spirit. We will do all we can to make it succeed.

Simple labels falsify the many real communities of interest which exist—some overlapping, some competitive, some complementary. One of the striking features of the modern world economy is the diversity of its participants. Among the countries formerly classed as "developing," there have emerged in the last decade new economic powers with a growing capacity to export manufactures and raw materials. The most successful have fostered investment and growth at home. To these emerging powers have now been added the oil-rich countries. Any nation with a moral claim to world leadership—we as well as the newly wealthy must contribute to easing the plight of the poorest countries. For who can deny that every economic problem—stagnation, inflation, high energy prices, food shortages—hits them hardest?

The United States recognizes the responsibility that accompanies its economic power. We are prepared to do our part, in a spirit of equality, mutual respect, and cooperation. Yesterday I discussed our proposals for achieving a successful multilateral energy dialogue. Today let me turn to food, raw materials, and trade and finance. A breakdown of the system in these areas would foster economic chaos and instability. Successful collaboration could usher in a new era of economic advance and human progress.

## Food—A Moral and Political Challenge

852

Department of State Bulletin

June 23, 1975

853

854

Department of State Bulletin

(L)

presents such an opportunity to shape our future. We are summoned to seize the possibilities inherent in the new era which the whole world is now entering. We should be confident and not timid; others are seeking to join in what we have built. Our challenge is to encourage progress and not abstract ideological confrontation. With this attitude we can look forward with optimism to the major international deliberations before us such as the seventh special session of the U.N. General Assembly this fall.

June 23, 1975

855

PRESS
DEPARTMENT OF STATE

[lc]

May 29, 1975

NO. 304A

RESPONSES BY
THE HONORABLE HENRY A. KISSINGER
SECRETARY OF STATE
TO QUESTIONS BY TED KOPPEL OF ABC-TV
FOLLOWING THE MORNING SESSION OF THE
OECD MINISTERIAL MEETING
PARIS

MAY 28, 1975

MR. KOPPEL: Could you tell us something about the kind of mood you have found among European leaders? What will the President find on his trip?

SECRETARY KISSINGER: I think the President will find a very constructive mood of friends wanting to work together and realizing what the fundamentals are.

MR. KOPPEL: Now in your speech today you talked about U.S. desire for cooperation, but you also warn against confrontation. Did you find any mood of confrontation?

SECRETARY KISSINGER: Not among our European friends. That warning against confrontation was directed against some countries in larger forums such as the United Nations.

MR. KOPPEL: Do you sense the same spirit of unity within NATO that existed when the Soviet Union was perceived as more of a threat?

SECRETARY KISSINGER: Well, it is a different situation -- more complicated, as is shown by the fact that this week we are putting so much emphasis on energy and economic cooperation. But I am very encouraged by the atmosphere in these meetings and by the very serious effort everyone is making to find a new basis for a new period of creativity.

MR. KOPPEL: What will be the principal issues that the President takes up beginning tomorrow before NATO?

SECRETARY KISSINGER: He will take up some of the conventional issues, such as security. He will then take up some of the issues that have been discussed here; namely the new problems that we are all facing: energy, economic cooperation, relations with the newly-developed countries. And he will take up relations with the East, how detente fits into this whole structure.

MR. KOPPEL: How about the internal problems of NATO, for example Portugal, the problems between Turkey and Greece?

SECRETARY KISSINGER: As you know, he is spending tomorrow morning with the Greek and Turkish Prime Ministers. These are subjects that will come up more in bilateral meetings than in the formal sessions.

* * * * *

FOR IMMEDIATE RELEASE

MAY 29, 1975

OFFICE OF THE WHITE HOUSE PRESS SECRETARY
(Brussels, Belgium)

THE WHITE HOUSE

PRESS CONFERENCE

OF

HENRY A. KISSINGER

SECRETARY OF STATE

BRUSSELS SHERATON HOTEL

6:43 P.M. (Brussels Time)

SECRETARY KISSINGER: Ladies and gentlemen, I will begin with the President's presentation at the NATO session then I will summarize the bilateral meetings that took place today.

I know you have already been briefed on the ones this morning, but I will sum them up anyway.

On the speech that the President made to the NATO Council, you will have the text and therefore, there is no point in my going through all of the portions.

The President began by summing up the nature of the original American commitment, the purposes that NATO originally had been designed to serve, and stated his conviction that in his view these required no new restatement, that they were as valid today as they were then.

He then discussed a number of problems that he saw before the Alliance, or problems that might affect the Alliance in the field of defense, in the field of disagreements that had arisen between some allies, the field of energy, and with respect to the Middle East.

He then discussed six major areas that in his view required attention.

First, the need for a strong and credible defense. He pointed out that without security no other objectives would make any sense. He called for meeting the longstanding goals for common procedures of equipment, for a more systematic research and development, and reiterated our commitment not to engage in any unilateral withdrawal of American forces.

- 2 -

You can take that as a given of our policy that outside the MBFR framework, the United States will not withdraw any forces from NATO.

The second point he stressed was the need to preserve the quality and integrity of the Alliance on the basis of unqualified participation and not on the basis of partial membership or special arrangements that individual countries might wish to make with the Alliance.

Q Does that mean that France --

SECRETARY KISSINGER: I will answer questions later. Let me just run through this.

The third was a call for an improvement in the process of political consultation. As you know, it has been our position throughout our discussions with our allies that solidarity with respect to defense cannot be maintained for an indefinite period of time unless there is solidarity with respect to political objectives and in our view, increasing them with respect to the new agenda which the President treated separately.

Fourth, the President asked for a joint action in developing a productive and realistic agenda for detente that serves our interest and not the interests of others, an agenda, in other words, that we could do jointly rather than each of the individual members separately.

He related this to the European Security Conference and to the Mutual Balanced Force Reduction.

Fifth, he called attention to the future of the West, itself, calling for the strengthening of our Democratic institutions within the Alliance and encouraging the growth of Democratic processes within the members of the Alliance.

Sixth, he emphasized that the vitality of the Alliance depended on the conception by the members of the Alliance as a great joint enterprise and not simply as a series of individual efforts and not purely as a defense, and he called attention to the agenda which we have been putting forward all week in other forums of energy, of population, of food, and of raw materials in addition to the need for strengthening the world trading and monetary systems, and he called for cooperative action in all of these things.

He expressed his conviction that the United
States had trials over the recent months; it is never-
theless in a strong position -- that we possess the
will power, the technical capability and the spiritual
conviciton to do what is needed to master the agenda what
he outlined.

Now, so much for his presentation at the
NATO Council. He was the only speaker except for a
military briefing by the Chairman of the Military
Committee.

Now, we can proceed in one of two ways: I
can either sum up the bilateral talks and then take
your questions or I can take questions on this and
then -- should I continue?

Q Yes. Sum it up.

SECRETARY KISSINGER: Sum up the bilateral
talks?

Q Yes, that is correct.

SECRETARY KISSINGER: The President met
during the day, as you know, with the Prime Minister
of Luxembourg, with the Prime Ministers of Greece
and Turkey, with the Chancellor of the Federal Republic,
the Prime Minister of Denmark and with the Prime
Minister of Portugal. If I have forgotten somebody, we
are in a major diplomatic problem. (Laughter)

As I understand it, you have already been
briefed about the meetings that took place this
morning.

Let me just add one comment about the discussions
that are taking place with the representatives from
Greece and Turkey.

We are not, as we have repeatedly pointed out,
acting as mediator. What we are attempting to do is, one,
to contribute to a framework in which the negotiations
between the parties would be eased. We are, therefore,
talking to the parties about general principles and
approaches that could be followed in moving toward a
solution of the dispute between them because we believe that
the quarrel between two allies -- both of whom we value --
is against the interests of the Alliance, against their
own interests.

We believe that while these negotiations are going on, neither side should take any military actions or make any military threat or take any steps that could lead to military action, and we have expressed that conviction to the parties concerned.

As you know, the Greek and Turkish Foreign Ministers are going to meet tomorrow, and the Greek and Turkish Prime Ministers are meeting on Saturday.

I will be meeting with the Greek Foreign Minister, maybe the Prime Minister, tomorrow, and I will also meet with the senior Turkish official.

We hope that this process will contribute not only to easing the tensions, but to generating a framework in which a solution to their dispute becomes easier and is ultimately attained, and within these limits which I have described to you, we thought the talks went well.

As for the meeting with the German Chancellor, he is, of course, a very close ally and a very good friend. We reviewed the state of the Alliance, the state of East-West relations. We had a brief discussion on the Middle East, but we spent most of our time on the nature of the economic conditions in the industrial world and the problem of industrial growth as they affected stability, cohesiveness of our societies and of our Alliance, as well as the relationship between the industrial societies and the developing society.

The meeting with the Prime Minister of Denmark dealt with the general problems of the Alliance, and were such common issues as their perception of the Portuguese situation and our joint views on East-West relations.

For the benefit of the fraternity of Foreign Ministers, I want to point out that in each case the Prime Ministers, or Chancellors, were accompanied by their Foreign Ministers, who made a major contribution to the discussion.

Therefore, I hope you will -- yes, the American Foreign Minister also contributed. (Laughter) Just a minute. You don't want to hear about Portugal? (Laughter)

I will be glad to take questions now.

In the meeting with the Portuguese Prime Minister, the discussion was very frank and was conducted in a friendly atmosphere. The President explained his views about the impact on NATO of a Government in which a Communist might play a significant role.

The Portuguese explained to us the nature of their domestic structure, which is, as you all know, unique in the NATO Alliance, and there was a very frank and, I believe, mutual exchange of views.

This is the extent of the bilaterals.

Now, I will take some questions.

Q Mr. Secretary, when you outlined the President's remarks, including the point that special arrangements could not be made, does that mean that if Portugal becomes Communist dominated, there is no way to fit it into NATO? Is that what he was trying to say?

SECRETARY KISSINGER: No, I think that what we were saying, in elliptical diplomatic language, is that the special arrangements that various member nations have already attempted to make cannot become the normal pattern if the Alliance is to survive in its present form.

Q Do you mean Greece pulling out on the military side and Turkey threatening and that kind of thing?

Q Question, sir.

SECRETARY KISSINGER: The question is, in Helen Thomas' precise formulation, Greece pulling out of the Alliance, Turkey threatening or that sort of thing, and the answer is --

Q Military bases.

SECRETARY KISSINGER: The answer is we mean that sort of thing. (Laughter)

Q Dr. Kissinger, you are always so enlightening in your elliptical terms. Thank you. (Laughter)

SECRETARY KISSINGER: That is another sort of thing. (Laughter)

Q Mr. Secretary, did the Turkish Prime Minister, according to one report, tell the President that he would prefer not to have the U.S. act as a mediator or to intervene and leave it to both sides to settle this type of dispute?

(wc)

SECRETARY KISSINGER: No, that did not happen. We have never said that we were acting as mediators. We did not put ourselves forward as mediators, nor did the Turkish Prime Minister tell us what role he wanted us to play, or that he didn't want us to play any role.

The discussions with the Turkish leaders were in the framework that had originally been charted in my two visits to Ankara, and there was no such implication.

It is, of course, clear that the basic negotiation will have to take place between the Greek and Turkish communities on Cyprus, as well as between the Greek and Turkish Governments.

Our role is to facilitate, to help, as we are requested, and perhaps to come up with an occasional idea.

Q Mr. Secretary, the United States having expressed its concern about unqualified membership in NATO, what does it intend to do about it? Were there any specific proposals or does the United States have any specific proposals to carry out this intention?

SECRETARY KISSINGER: No.

Q Question.

SECRETARY KISSINGER: The question is, the United States having expressed its concern about the problem of -- not unqualified support, qualified support -- qualified membership in NATO -- what is the United States going to do about it?

The purpose of the President's speech was to outline the problems he saw before the Alliance and the issues that needed solutions.

As you know, the whole day tomorrow will be devoted to discussion and there will, without any doubt, be additional Presidential intervention as the discussion continues.

This was not an attempt to put forward all of the solutions to all of the problems he outlined.

Q Mr. Secretary, when you, in several different formulations, warned the Turks and the Greeks against taking forceful action, why is it necessary to make that such a strong point?

SECRETARY KISSINGER: The question was, if, in
several formulations I warned the Greeks and the Turks
against forceful action.

It was only in one formulation. I tried
to sum up what our general view is, and our view
happens to be that the use of force and the threat
of force during these negotiations by either side
would not be helpful and that the process of negotia-
tion should have the primary role.

There is no specific threat of force at this
particular moment, but given the potential tenseness
of the situation, we simply wanted to state our
view.

Q Mr. Secretary, excuse me. If I could
just follow up.

Did the President make that same cautionary
remark?

SECRETARY KISSINGER: Of course. I am
reporting about the President's conversation.

Q Mr. Secretary, what did the President
tell the Portuguese Prime Minister he thought the
impact on NATO would be if Portugal were dominated
by Communists?

Q Question.

SECRETARY KISSINGER: The question is, what
did the President point out to the Portuguese Prime
Minister that the impact on NATO would be if Portugal
were dominated by Communists.

MORE

He pointed out that the impact would be
unfortunate and somewhat incompatible with the pur-
poses of NATO.

Q Mr. Secretary, in connection with your
discussion with the Portuguese, did they give any
assurances that it is not the intention of the
Portuguese government to be a Trojan horse in a
NATO structure, that that was not their purpose?
Could you give us some of the language he might have
used?

Q Question.

The question is, did the Portuguese Prime
Minister give us any assurances about Portugal not
being a Trojan horse.

As a matter of fact, that was a phrase that
came up in the discussion. We did not ask for any
assurances. The purpose of this meeting was to make
clear our view and to enable in the first meeting
between the President and the Portuguese leaders --
for them to express their views.

We also made clear that we welcomed a
change in Portugal from its previous system to a
democratic system, and we expressed our good will
towards such efforts.

The view of the Portuguese ministers was
that they did not represent a Communist-dominated
government.

MR. NESSEN: Let's have two more questions.

SECRETARY KISSINGER: You are recognized.

Q During the course of the President's
conversation with the Chancellor, were the subjects
of Spain and Portugal discussed?

SECRETARY KISSINGER: The President pointed
out in his speech, which you will get, our view that
Spain should have a closer relationship to Western
defense. There was some brief discussion about our
views with respect to Spain and on which there was,
perhaps, not complete unanimity and some brief dis-
cussion on Portugal.

We had already, last week when I was in
the Federal Republic, extensive conversations with
both the Chancellor and the Foreign Minister on
Portugal which, of course, the President was fully
familiar with.

MR. NESSEN: The last question right over
here.

Q Sir, was the conversation with the
Portuguese in English or was that through an interpreter?

Q Question.

SECRETARY KISSINGER: We can ask one more
substantive question.

The question was, was the conversation with
the Portuguese in English or through an interpreter.

It was through an interpreter.

MR. NESSEN: Jack?

Q Mr. Secretary, what about the meeting
with d'Estaing tonight and if you could answer that
and tell us how it came about, would you also tell us
what you think about France's special relationship
within the NATO organization.

SECRETARY KISSINGER: I think it is covered
in the point that is made in the President's
speech.

Q Question?

SECRETARY KISSINGER: With respect to the
meeting of the two Presidents. President Giscard
called President Ford about two weeks ago and told
him that he had decided to attend the meeting of the
NATO heads of state, and heads of Government, and on
that occasion suggested, or it was mutually agreed,
that while he attended this meeting a discussion
between the two Presidents seemed appropriate.

We feel very strongly that this is the case,
that a number of topics that we wish to discuss,
including the energy problem, which I have already
had a preliminary discussion with the French President
about, Middle East, Atlantic relations and the usual
agenda of U.S.-French relations, and, as you know, the
two Presidents have a very warm personal relationship.

Q You mentioned energy. You said meeting.
You meant dinner?

SECRETARY KISSINGER: I meant dinner. I am
sorry. He was going to come to the dinner, and in
connection with that dinner, a meeting would be
appropriate.

MORE

MR. NESSEN: We will see you back here at
11:30 or midnight for any report on the Giscard
meeting.

THE PRESS: Thank you.

END (AT 7:08 P.M. Brussels Time)