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IV. **THE THIRD WORLD: INTERDEPENDENCE**

**The Economic and Political Relationship**

The energy crisis helped prompt the articulation of a U. S. strategy for the Third World. HK's main theme was economic interdependence: Neither "North" nor "South" could achieve its aims without a reasonably cooperative relationship with the others. The United States would set an example with respect to certain Third World needs such as food (see pp. below) as a platform for insisting on a more realistic OPEC policy on oil. On the political plane, the hallmark of US policy was an insistence on reciprocity, mutual respect and serious negotiation. We would resist all attempts to extort by blackmail what we were prepared to do on a serious cooperative basis. The climax was HK's address to the Seventh Special Session of the UN General Assembly, September 1, 1975 (see pp. 153 ff below).

Even before the energy crisis erupted, HK spoke to the UNGA on September 24, 1973 (#2) and told the delegates of our willingness to address the Third World's economic problems on a fair basis. He mentioned Mexican President Echeverria's Charter of the Economic Rights and Duties of States; rather than attack it head on, HK took the position that it would be acceptable *if* it defined the rights and duties in a fair and noncontentious manner:

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4. A world community cannot remain divided between the permanently rich and the permanently poor.

Let us therefore resolve that this Assembly, this year, initiate a search—drawing on the world's best minds—for new and imaginative solutions to the problems of development. Our search must be candid and realistic, but it must also be free of preremptory demands, antagonistic propositions, ideological confrontation, or propagandistic rhetoric—or we will surely fail.

The United States is prepared to join in this new search, providing freely of the experience gained over two decades. We have learned not to exaggerate our capacity to transform nations—but we have also learned much about what progress is possible.

We will participate without preconditions, with a conciliatory attitude and a cooperative commitment. We ask only that others adopt the same approach.

In this spirit the United States is willing to examine seriously the proposal by the distinguished President of Mexico for a Charter of the Economic Rights and Duties of States. Such a document will make a significant and historic contribution if it reflects the true aspirations of all nations; if it is turned into an indictment of one group of countries by another, it will accomplish nothing. To command general support—and to be imple-

mented—the proposed rights and duties must be defined equitably and take into account the concerns of industrialized as well as of developing countries. The United States stands ready to define its responsibilities in a human and cooperative spirit.

* * *

Mr. President, fellow delegates: Are we prepared to accept the imperatives of a global society and infuse our labors with a new vision? Or, shall we content ourselves with a temporary pause in the turmoil that has wracked our century? Shall we proceed with one-sided demands and sterile confrontations? Or shall we proceed in a spirit of compromise produced by a sense of common destiny? We must move from hesitant cooperation born of necessity to genuine collective effort based on common purpose.

It is a choice no country can make alone. We can repeat old slogans or strive for new hope. We can fill the record of our proceedings with acrimony, or we can dedicate ourselves to dealing with man's deepest needs. The ideal of a world community may be decried as unrealistic—but great constructions have always been ideals before they can become realities. Let us dedicate ourselves to this noblest of all possible goals and achieve at last what has so long eluded us: true understanding and tolerance among mankind.

The same themes — firmness and willingness to cooperate—were featured in HK's address on April 15, 1974, to the Sixth Special Session of the UNGA (#13), a conference devoted to the subject of "resources for development." This was a few months after the energy crisis began, HK denounced the confrontational approach as futile and as inconsistent with the reality of interdependence. The "politics of pressure and threats" would undermine the domestic support in the industrial countries for cooperation with the developing world; it would only trigger counteractions:

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We are gathered here in a continuing venture to realize mankind's hopes for a more prosperous, humane, just, and cooperative world.

As members of this organization, we are pledged not only to free the world from the scourge of war but to free mankind from the fear of hunger, poverty, and disease. The quest for justice and dignity—which finds expression in the economic and social articles of the United Nations Charter—has global meaning in an age of instantaneous communication. Improving the quality of human life has become a universal political demand, a technical possibility, and a moral imperative.

We meet here at a moment when the world economy is under severe stress. The energy crisis first dramatized its fragility. But the issues transcend that particular crisis. Each of the problems we face—of combating inflation and stimulating growth, of feeding the hungry and lifting the impoverished, of the scarcity of physical resources and the surplus of despair—is part of an interrelated global problem.

Let us begin by discarding outdated generalities and sterile slogans we have—all of us—lived with for so long. The great issues of development can no longer realistically be perceived in terms of confrontation between the “haves” and “have-nots” or as a struggle over the distribution of static wealth. Whatever our ideological belief or social structure, we are part of a single international economic system on which all of our national economic objectives depend. No nation or bloc of nations can unilaterally determine the shape of the future.

If the strong attempt to impose their views, they will do so at the cost of justice and thus provoke upheaval. If the weak resort to pressure, they will do so at the risk of world prosperity and thus provoke despair.

The organization of one group of countries as a bloc will, sooner or later, produce the organization of potential victims into a counter bloc. The transfer of resources from the developed to the developing nations—essential to all hopes for progress—can only take place with the support of the technologically advanced countries. Politics of pressure and

threats will undermine the domestic base of this support. The danger of economic stagnation stimulates new barriers to trade and to the transfer of resources.

We in this Assembly must come to grips with the fact of our interdependence.

The contemporary world can no longer be encompassed in traditional stereotypes. The notion of the northern rich and the southern poor has been shattered. The world is composed not of two sets of interests but many: developed nations which are energy suppliers and developing nations which are energy consumers, market economies and nonmarket economies, capital providers and capital recipients.

The world economy is a sensitive set of relationships in which actions can easily set off a vicious spiral of counteractions deeply affecting all countries, developing as well as technologically advanced. Global inflation erodes the capacity to import. A reduction in the rate of world growth reduces export prospects. Exorbitantly high prices lower consumption, spur alternative production, and foster development of substitutes.

We are all engaged in a common enterprise. No nation or group of nations can gain by pushing its claims beyond the limits that sustain world economic growth. No one benefits from basing progress on tests of strength.

For the first time in history, mankind has the technical possibility to escape the scourges that used to be considered inevitable. Global communication insures that the thrust of human aspirations becomes universal. Mankind insistently identifies justice with the betterment of the human condition. Thus economics, technology, and the sweep of human values impose a recognition of our interdependence and of the necessity of our collaboration.

Let us therefore resolve to act with both realism and compassion to reach a new understanding of the human condition. On that understanding, let us base a new relationship which evokes the commitment of all nations because it serves the interests of all peoples. We can build a just world only if we work together.

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Matching Physical Needs With Political Vision

All too often, international gatherings end with speeches filed away and with resolutions passed and forgotten. We must not let this happen to the problem of development. The complex and urgent issues at hand will not yield to rhetorical flourishes. Their resolution requires a sustained and determined pursuit in the great family of United Nations and other international organizations that have the broad competence to deal with them.

As President Nixon stated to this Assembly in 1969:

> Surely if one lesson above all rings resoundingly among the many shattered hopes in this world, it is that good words are not a substitute for hard deeds and noble rhetoric is no guarantee of noble results.

This Assembly should strengthen our commitment to find cooperative solutions within the appropriate forums such as the World Bank, the International Monetary Fund, the GATT, and the World Food and Population Conferences. The United States commits itself to a wide-ranging multilateral effort.

Mr. President, Mr. Secretary General, we gather here today because our economic and moral challenges have become political challenges. Our unprecedented agenda for global consultations in 1974 already implies a collective decision to elevate our concern for man's elementary well-being to the highest political level. Our presence implies our recognition that a challenge of this magnitude cannot be solved by a world fragmented into self-contained states or competing blocs.

Our task now is to match our physical needs with our political vision.

President Boumediene cited the Marshall plan of a quarter century ago as an example

of the possibility of mobilizing resources for development ends. But then the driving force was a shared sense of purpose, of values, and of destination. As yet, we lack a comparable sense of purpose with respect to development. This is our first requirement. Development requires, above all, a spirit of cooperation, a belief that with all our differences we are part of a larger community in which wealth is an obligation, resources are a trust, and joint action is a necessity.

We need mutual respect for the aspirations of the developing as well as the concerns of the developed nations. This is why the United States has supported the concept of a Charter of Economic Rights and Duties of States put forward by President Echeverría of Mexico.

The late President Radhakrishnan of India once wrote:

> We are not the helpless tools of determinism. Though humanity renews itself from its past, it is also developing something new and unforeseen. Today we have to make a new start with our minds and hearts.

The effort we make in the years to come is thus a test of the freedom of the human spirit.

Let us affirm today that we are faced with a common challenge and can only meet it jointly. Let us candidly acknowledge our different perspectives and then proceed to build on what unites us. Let us transform the concept of world community from a slogran into an attitude.

In this spirit let us be the masters of our common fate so that history will record that this was the year that mankind at last began to conquer its noblest and most humane challenge.

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HK spoke in a philosophical vein about interdependence in his address to the Conference of Tlatelolco in Mexico City, February 21, 1974 (# 11). Cooperation in Latin America, indeed, was to be a model for North-South relations around the world:

## An Interdependent World

A century ago a U.S. President described to the Congress the difficulties facing the country: "It is a condition which confronts us—not a theory." The condition we confront today is a world where interdependence is a fact, not a choice.

The products of man's technical genius— weapons of incalculable power, a global economic system, instantaneous communications, a technology that consumes finite resources at an ever-expanding rate—have compressed this planet and multiplied our mutual dependence. The problems of peace, of justice, of human dignity, of hunger and inflation and pollution, of the scarcity of physical materials and the surplus of spiritual despair, cannot be resolved on a national basis. All are now caught up in the tides of world events—consumers and producers, the affluent and the poor, the free and the oppressed, the mighty and the weak.

The world and this hemisphere can respond in one of two ways:

There is the path of autarky. Each nation can try to exploit its particular advantages in resources and skills and bargain bilaterally for what it needs. Each nation can try to look after itself and shrug its shoulders at the plight of those less well endowed. But history tells us that this leads to ever more vicious competition, the waste of resources, the stunting of technological advance, and most fundamentally, growing political tensions which unravel the fabric of global stability. If we take this route, we and our children will pay a terrible price.

Or we can take the path of collaboration. Nations can recognize that only in working

with others can they most effectively work for themselves. A cooperative world reflects the imperatives of technical and economic necessity but, above all, the sweep of human aspirations.

The United States is pledged to this second course. We believe that we of the Americas should undertake it together.

This hemisphere is a reflection of mankind. Its diversity reflects the diversity of the globe. It knows the afflictions and frustrations of the impoverished. At the same time many of its members are leaders among modernizing societies. Much has been done to overcome high mortality rates, widespread illiteracy, and grinding poverty. This hemisphere uniquely includes the perceptions of the postindustrial societies, of those who are only beginning to sample the benefits of modernization, and of those who are in mid-passage.

The Americas reach out to other constellations as well. The nations of Latin America and the Caribbean share much of the stirrings of the Third World. The United States is engaged in the maintenance of peace on a global basis. Pursuing our separate ways narrowly, we could drift apart toward different poles. Working together, we can reinforce our well-being and strengthen the prospects for global cooperation.

So let us begin here in this hemisphere. If we here in this room fail to grasp the consequences of interdependence, if we cannot make the multiplicity of our ties a source of unity and strength, then the prospects for success elsewhere are dim indeed. The world community which we seek to build should have a Western Hemisphere community as one of its central pillars.

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HK sounded the same theme of global interdependence at the annual dinner of the Alfred E. Smith Memorial Foundation in New York on October 16, 1974 (#18). We were midway between the nation-state and global community:

But now—indeed, partly because of our success—we experience the birth pangs of a new order. We face a new dimension of challenges, more pervasive and complex, with perils at once more subtle and profound. A new world is emerging—a world whose security, well-being, and moral fulfillment demand interdependence; a world whose peoples are interlinked by technology and global communications, by the common danger of nuclear war, and by the worldwide thrusts of human needs; a world in which traditional structures and tenets of diplomacy are being overwhelmed.

At the midway point between the end of the Second World War and the end of this century, we find ourselves also midway between the nation-state from which we began and the global community which we must fashion if we are ever to live in a lasting peace.

We face a new and fundamental crisis of the international system:

- Inflation is a global phenomenon infecting all societies and clearly beyond the power of any national government to control alone.

- The threat of global famine and mass starvation is an affront to our values and an intolerable threat to our hopes for a better world.

- The abrupt rise of energy costs, and the ensuing threats of monetary crisis and economic stagnation, threaten to undermine the economic system that nourished the world's well-being for over 30 years.

All these problems are dealt with in a clearly inadequate framework. National solutions continue to be pursued when, manifestly, their very futility is the crisis we face.

Inflation eats away the well-being of nations on the verge of development and of

whole classes at the margin of society. Economic stagnation, or recession, will feed the frustration of groups whose expectations for a share in the prosperity they see around them are suddenly and cruelly rebuffed. Starvation will shatter the hopes of developing nations for progress. Thus the economic crisis threatens to magnify the discontent and ungovernability of all societies.

Only cooperative international solutions are equal to the challenge. With respect to energy, consumers must be prepared to share and conserve and provide mutual financial assistance; consumers and producers together must shape a mutually beneficial long-term relationship; there must be a determined and lasting commitment in each country to the conservation and discipline President Ford proposed to the nation a week ago.

The threat of mass starvation, in particular, requires a major commitment. Cardinal Cooke's eloquent appeal for assistance to the drought-ridden Sahel, which he has just visited, deserves our strong support. And at next month's World Food Conference in Rome, the United States plans to launch a new long-term international program of action. To do less would violate moral imperatives as well as practical necessities.

Nor is the current crisis purely economic. After nearly 30 years without general war, the world has become dangerously tolerant of accelerating nuclear proliferation and the purposeless expansion of strategic arsenals. Festering political conflicts, whether in the Middle East or Cyprus or Indochina, ultimately could pose the same threat to general peace as did the more dramatic great-power confrontation of a decade ago.

Thus the requirements of peace and progress demand of all nations a new and unprecedented sense of responsibility to the international system.

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In a speech before the Kansas City International Relations Council in Kansas City on May 13, 1975 (# 28), HK discussed, in historical perspective, the challenge to the international economic system posed by the Third World. The United States was convinced the existing economic system had served the world well; any solution to the present disputes had to be found on the basis of shared prosperity and cooperative efforts, not confrontation:

After the experience of the 1930's, the post-war 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 insure that our policies remain coordinated, 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 Simon [William E. Simon, Secretary of the Treasury] 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

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

The United States is convinced that an in-

ternational 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 two 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.

At the OECD Ministerial in Paris on May 28, 1975 (# 32), HK discussed the relationship between the developed and developing worlds. He warned again against confrontational politics, bloc pressure tactics, and abuse of economic power. It was also time "to end the theoretical debate over whether we are seeking a new order or improving the existing one." It was time to "deal in reality, not rhetoric." He called again for help from the newly-wealthy oil-producing states for the poorest nations, which were hit the hardest of all by the energy crisis:

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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 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.

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In a speech in Atlanta before the Southern Council on
International and Public Affairs and the Atlanta Chamber of
Commerce, on June 23, 1975 (# 34), HK reiterated that the
United States would "not submit to blackmail, bloc pressures,
or ideological rhetoric." We would defend our interests.
However, we were prepared to deal on a cooperative basis
in a number of areas, which he listed:

## The Developing Nations

In recent years, the problems of the new
nations of the developing world have grown
more urgent.

The strength of the dollar, the expansion
of trade, the free flow of investment, the
supply and price of energy, food, and other
vital raw materials all depend on the vitality
of the international economic system. But
no economic system can be stable if scores
of nations consider themselves outside of
and hostile to it. The present global eco-
nomic system is large enough to encom-
pass the well-being of consumers and pro-
ducers, rich and poor. But if it does not,
we face a generation of economic warfare.
The United States is prepared to work, with
understanding and imagination, for change.
But there must be a process of mutual
accommodation that safeguards the interests
of all nations. We will not submit to black-
mail, bloc pressures, or ideological rhetoric.
We will defend our interests. But we will
listen to reasoned debate and consider care-
fully productive suggestions for reform.

The United States has already taken the
lead with new proposals on a range of issues
vital to the developing world:

—To fight the scourge of hunger, this
government, recognizing that America's food
aid cannot provide a long-term solution to
the global food problem, called for the World
Food Conference which met last November
in Rome. At that conference we engaged
other nations in a multilateral commitment
to raise food production, to improve agric-
cultural financing and distribution, and to

establish an international system of national-
ly held grain reserves.

—Some 140 nations are now engaged in
an unprecedented negotiation on a compre-
hensive new law of the sea. At stake are
the reach of territorial sovereignty, the safe-
ty of the shipping lanes, and access to vast
resources. Success in these negotiations
would represent an unprecedented achieve-
ment in international cooperation affecting
three-quarters of the surface of our planet
and enormous mineral and other wealth. The
United States will make a major effort to
bring it to a successful conclusion at the
final session next March.

—On the broader question of raw mate-
rials, the developing countries seek a stable
and fair income from commodities which are
central to their development programs. We
in turn seek reliability of supply for our
industries. The United States has therefore
proposed new international rules and pro-
cedures on access to supplies and markets,
discussions on new arrangements for com-
modity trade on a case-by-case basis, and
new ways of financing commodity develop-
ment in producing countries.

All these issues will be raised at a special
session of the U.N. General Assembly this
September. Working closely with Congress,
we are now preparing concrete, detailed,
and—we hope—creative proposals for that
session. We intend, while fully protecting
our nation's interests, to deal with contro-
versial issues with realism, imagination, and
understanding. We hope that others will
meet us in the same spirit.

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In Milwaukee on July 14, 1975, at a dinner meeting sponsored by the University of Wisconsin Institute of World Affairs and other organizations (# 35), HK spoke on the United Nations and the future of international cooperation. He urged Third World nations to face up to the realities of economic development. The United States was "obliged to speak plainly to the question of what works and what does not." (Pat Moynihan helped with this speech.)

## The Problem of Interdependence

In the last few years the world economy has undergone a series of shocks and strains:

- Nations have suffered both severe inflation and deep recession on a worldwide scale.

- The price of the world's most essential commodity, petroleum, has been precipitously and arbitrarily increased, burdening the economies of all consuming nations and imposing the most serious hardships on the poorest countries.

- The world's food reserves have dwindled alarmingly in only a few short years. Unless massive efforts are mounted, the gap between population growth and food production could reach disastrous proportions.

- The pursuit of economic growth is complicated by the fact of interdependence; it can no longer be pursued by national efforts, but requires coordinated global actions.

This September's special session of the General Assembly will focus on the new global economic concerns. It will be an early and important test: Will the rich nations and poor nations identify common goals and solve problems together, or will they exacerbate their differences? Can we turn our energies from rhetorical battles to practical cooperation? Will nations strive for empty parliamentary victories or concrete progress?

The United States has made its choice. We believe strongly in a cooperative approach. We believe that the time has come to put the

technological and economic genius of mankind into the service of progress for all. We will approach the special session with determination to make progress; we intend to make concrete and constructive proposals for action across a broad spectrum of international economic activities such as trade and commodities, world food production, and international financial measures.

The session will also consider structural changes to improve the U.N.'s capabilities in the field of economic development. A group of experts appointed by Secretary General Waldheim has just completed a study of this subject. We will offer specific comments on these recommendations during the Assembly debate.

In this spirit, let me speak directly to the new nations who have pressed their claims with increasing fervor. We have heard and have begun to understand your concerns. We want to be responsive. We are prepared to undertake joint efforts to alleviate your economic problems. Clearly this requires a posture of cooperation. If nations deal with each other with respect and understanding, the two sessions this fall could mark the beginning of a new era in which the realities of an interdependent world economy generate a global effort to bring about peaceful and substantial change.

At the same time we are obliged to speak plainly to the question of what works and what does not. We believe that economic

151

development is in the first instance an in-
ternal process. Either societies create the
conditions for saving and investment, for in-
novation and ingenuity, and for enterprise
and industry which ultimately lead to self-
sustaining economic growth, or they do not.
There is no magical shortcut and no rhetori-
cal substitute. And to claim otherwise sug-
gests a need for permanent dependence on
others.

In this quest for development, experience
must count for something and ideology is
an unreliable guide. At a minimum, we
know which economies have worked and
which have failed; we have a record of what
societies have progressed economically and
which have stagnated. We know from our
own experience that investment from abroad
can be an important spur to development.
We know also that it is now in short supply.
In the future, as in the past, there will be
competition to attract capital; therefore
those who do not wish investment from
abroad can be confident that they will not
receive it. By the same token those countries
which are eager to industrialize must also
be ready to create the conditions that will
attract large-scale investment.

The voting records of the blocs in the
General Assembly simply do not reflect eco-
nomic reality. The family of less developed
countries includes both producers and con-
sumers of energy, importers and exporters
of raw materials, and nations which can
feed their populations as well as those which
face the specter of famine. These divergent
interests must be accommodated and reflected
in practical measures; they cannot be re-
solved from the unreality of bloc positions.

At the same time, the industrial world
must adapt its own attitudes to the new

reality of scores of new nations. At bottom
the challenge is political, not economic—
whether the interests and weight of the
less developed nations can be accommodated
in the international order. Their political
objectives often represent legitimate claims.
Yet at the same time the new nations must
not expect us to make only political decisions,
with no thought for economic consequences.
If they want truly to serve their peoples,
there must be practical concern for effec-
tive results.

If the industrial world wants to overcome
the attitude of confrontation between na-
tions, it must offer equitable solutions for
the problems of the less fortunate parts of
the world. Just as we are rightly concerned
about the economic impact of exorbitant oil
prices, so we should show understanding for
the concerns of producers of other raw
materials whose incomes fluctuate radically.

As for the operation of our companies
abroad, we consider it in our interest, as well
as in the common interest, to promote an
environment of mutual benefit in which our
international businesses can continue to be
both profitable and beneficial to the countries
in which they operate. We will address this
issue more fully at the special session.

Above all, the industrialized countries
must recognize that many developing coun-
tries have had frustratingly slow rates of
growth. Rather than a comfortable margin
of progress, they face an abundance of ob-
stacles and a surplus of despair. The future
of international politics-over the next gen-
eration—the kind of world our children will
inherit—will be determined by what actions
governments take now on this spectrum of
economic issues.

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Looking ahead to the Seventh Special Session of the UNGA, HK spoke in Birmingham on August 14, 1975, before the Southern Commodity Producers Conference (# 38). The United States would "never accept bloc pressure or blackmail," he said, with reference to the Third World. "Unfortunately, too many nations seek to exact by ideological confrontation what can only be achieved through reasoned cooperative dialogue." Food policy was "a model for cooperative relations:"

The industrial nations account for 65 percent of the world's output and 70 percent of its trade. Thus, the economic well-being of the developing nations, too, depends on broad cooperation with the industrialized world. Unfortunately, too many nations seek to exact by ideological confrontation what can only be achieved through reasoned cooperative dialogue. The United States is prepared for a serious and constructive cooperative dialogue. We are ready to develop equitable economic relations with all nations. But we will never accept bloc pressure or blackmail.

Early next month, a special session of the U.N. General Assembly will convene in New York to deal with the issues of economic interdependence. It will be a fateful occasion because it can determine the nature of the relationship between the developed and the developing countries. On the President's behalf I will present a series of American proposals looking toward a new approach to the relationship between the industrialized countries and those needing their help. We do so because we are convinced that our own economic health will be served by a world economy which is both expanding and perceived as fair. And our own security will be enhanced if we live in a world where frustration and despair give way to cooperation and a sense of our interdependence.

We enter this dialogue with confidence and good will. Our technological innovation, the productivity of our farms and industries, our educated and industrious people, and the blessing of our physical resources have given us the strength and responsibility for leadership.

In no area is this more striking than in the field of food. Our agricultural productivity is admired and desired all over the world. America's farmers and those who process and sell our food can be proud of their contribution to American strength in what is becoming an increasingly important dimension of our foreign policy and world leadership.

America has generously provided food aid to scores of foreign nations. But the gap between consumption and production is growing constantly. While we are prepared to continue food aid, this cannot provide a long-term answer to feeding the world's hungry. Therefore, a World Food Conference was convened in Rome last November at U.S. initiative. Acting on many American proposals, the conference organized a comprehensive international program to expand food production in developing countries and to channel resources—including the new wealth of the oil producers—to improving the financing, production, storage, and distribution of food.

We intend as a matter of principle to make our food policy a model for cooperative relations between producers and consumers of vital and scarce commodities and between developed and developing countries. In this way we serve our own as well as a general interest. America's farmers will benefit from a steady global demand for their product; as world production is expanded, the burden of shortages and higher prices will be lifted from our consumers; our political relations with scores of developing nations will be enhanced, and conditions of order worldwide will be improved.

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The most important philosophical statement on relations with the Third World was HK's address to the Seventh Special Session of the UN General Assembly on September 1, 1975, devoted to economic development. It was read to the UNGA by Pat Moynihan, since HK was in the Middle East completing the Sinai II agreement (signed on the same day). The full text is worth reading, or skimming (# 39). Attached at the same tab in the accompanying book is the relevant chapter from Moynihan's memoir of his service at the UN. It is a good summary of the bureaucratic and international politics that lay behind the speech; Moynihan is justly proud of his role in the formulation of the policy and the speech. In an extraordinary intercontinental procedure of speech drafting, Bob Hormats and Winston Lord in Jerusalem and Chuck Robinson and Tom Enders in Washington played heroic roles in last-minute clearances and interagency coordination. Bill Simon deserves much credit as well, since the proposals had to be worked out with Treasury. (Rodman helped with the speech.)

The speech was an eloquent restatement of the US philosophy toward the Third World: a critique of sterile ideologies, bloc politics, and counterproductive confrontations; a call for recognition of the reality of economic interdependence; a commitment to a cooperative quest for practical solutions. The speech listed specific proposals in five areas: instability of export earnings, capital flows, trade expansion, trade in key commodities, and the needs of the poorest. The speech was well received both in the UN and in the press.

Reproduced here are the philosophical portions of the speech (to which Moynihan made an important contribution). They express well the tone of the US approach: firm but cooperative, without guilt but without rancor:

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Global Consensus and Economic Development

Text of Address by Secretary Kissinger ¹

We assemble here this week with an opportu-
tunity to improve the condition of mankind.
We can let this opportunity slip away, or
we can respond to it with vision and common
sense.

The United States has made its choice. There are no panaceas available—only challenges. The proposals that I shall announce today on behalf of President Ford are a program of practical steps responding to the expressed concerns of developing countries. We have made a major effort to develop an agenda for effective international action; we are prepared in turn to consider the proposals of others. But the United States is committed to a constructive effort.

For some time the technical capacity has
existed to provide a tolerable standard of life
for the world's 4 billion people. But we,
the world community, must shape the politi-
cal will to do so. For man stands not simply
at a plateau of technical ability; he stands at
a point of moral choice. When the ancient
dream of mankind—a world without poverty
—becomes a possibility, our profound moral
convictions make it also our duty. And the
convening of this special session bears wit-
ness that economic progress has become a
central and urgent concern of international
relations.

The global order of colonial power that
lasted through centuries has now disap-
peared; the cold war division of the world
into two rigid blocs has now also broken

down, and major changes have taken place
in the international economy. We now live
in a world of some 150 nations. We live in
an environment of continuing conflicts, pro-
liferating weapons, new ideological divisions
and economic rivalry. The developing na-
tions have stated their claim for a greater
role, for more control over their economic
destiny, and for a just share in global pros-
perity. The economically advanced nations
have stated their claim for reliable supplies
of energy, raw materials, and other products
at a fair price; they seek stable economic re-
lationships and expanding world trade, for
these are important to the well-being of their
own societies.

These economic issues have already be-
come the subject of mounting confrontation
—embargoes, cartels, seizures, countermeas-
ures—and bitter rhetoric. Over the remain-
der of this century, should this trend con-
tinue, the division of the planet between
North and South, between rich and poor,
could become as grim as the darkest days
of the cold war. We would enter an age of
festering resentment, increased resort to eco-
nomic warfare, a hardening of new blocs, the
undermining of cooperation, the erosion of
international institutions—and failed devel-
opment.

Can we reconcile our competing goals?
Can we build a better world, by conscious
purpose, out of the equality and cooperation
of states? Can we turn the energies of all
nations to the tasks of human progress?
These are the challenges of our time.

We profoundly believe that neither the
poor nor the rich nations can achieve their
purposes in isolation. Neither can extort

¹ Read before the seventh special session of the U.N. General Assembly on Sept. 1 by Daniel P. Moynihan, U.S. Representative to the United Nations (text from press release 450).

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them from the other—the developing countries least of all, for they would pay the greater cost of division of the planet, which would cut them off needlessly from sources of capital and markets essential to their own progress.

The reality is that ample incentives exist for cooperation on the basis of mutual respect. It is not necessarily the case that if some grow worse off, others will be worse off. But there is an opposite proposition, which we believe is true: that an economic system thrives if all who take part in it thrive. This is no theory; it is our own experience. And it is an experience that we, a people uniquely drawn from all the other peoples of the world, truly desire and hope to share with others.

Therefore it is time to go beyond the doctrines left over from a previous century: that are made obsolete by modern reality.

History has left us the legacy of strident nationalism—discredited in this century by its brutal excesses a generation ago and by its patent inadequacy for the economic needs of our time. The economy is global. Recessions, inflation, trade relations, monetary stability, gluts and scarcities of products and materials, the growth of transnational enterprises—these are international phenomena and call for international responses.

History has also left us discredited doctrines of economic determinism and struggle. One of the ironies of our time is that systems based on the doctrine of materialism that promised economic justice have lagged in raising economic welfare.

And contrary to the ideologies of despair, many developing countries have been increasing their per capita incomes at far faster rates than obtained historically in Europe and North America in comparable stages of their growth.

It is also ironic that a philosophy of nonalignment, designed to allow new nations to make their national choices free from the pressure of competing blocs, now has produced a bloc of its own. Nations with radi>cally different economic interests and with entirely different political concerns are combined in a kind of solidarity that often clear-

ly sacrifices practical interests. And it is ironic also that the most devastating blow to economic development in this decade came not from "imperialist rapacity" but from an arbitrary, monopolistic price increase by the cartel of oil exporters.

The reality is that the world economy is a single global system of trade and monetary relations on which hinges the development of all our economies. The advanced nations have an interest in the growth of markets and production in the developing world; with equal conviction we state that the developing countries have a stake in the markets, technological innovation, and capital investment of the industrial countries.

Therefore the nations assembled here have a choice: We can offer our people slogans, or we can offer them solutions. We can deal in rhetoric, or we can deal in reality. My government has made its choice.

The United States firmly believes that the economic challenges of our time must unite us, and not divide us.

So let us get down to business. Let us put aside the sterile debate over whether a new economic order is required or whether the old economic order is adequate. Let us look forward and shape the world before us. Change is inherent in what we do and what we seek. But one fact does not change: that without a consensus on the realities and principles of the development effort, we will achieve nothing.

—There must be consensus, first and foremost, on the principle that our common development goals can be achieved only by cooperation, not by the politics of confrontation.

—There must be consensus that acknowledges our respective concerns and our mutual responsibilities. All of us have rights, and all of us have duties.

—The consensus must embrace the broadest possible participation in international decisions. The developing countries must have a role and voice in the international system, especially in decisions that affect them. But those nations who are asked to provide resources and effort to carry out the decisions must be accorded a commensurate voice.

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We have learned from experience that the methods of development assistance of the 1950's and 60's are no longer adequate. Not only did the technical accomplishments of many programs fall short of expectations; the traditional approaches are less acceptable to the industrialized world because they have seemed to become an endless and one-sided financial burden. And they are less acceptable to the developing world because they have seemed to create a relationship of charity and dependency, inconsistent with equality and self-respect.

Therefore we must find new means. The United States offers today concrete proposals for international actions to promote economic development. We believe that an effective development strategy should concentrate on five fundamental areas:

- First, we must apply international co-operation to the problem of insuring basic economic security. The United States proposes steps to safeguard against the economic shocks to which developing countries are particularly vulnerable: sharp declines in their export earnings from the cycle of world supply and demand, food shortages, and natural disasters.

- Second, we must lay the foundations for accelerated growth. The United States proposes steps to improve developing countries' access to capital markets, to focus and adapt new technology to specific development needs, and to reach consensus on the conditions for foreign investment.

- Third, we must improve the basic opportunities of the developing countries in the world trading system so they can make their way by earnings instead of aid.

- Fourth, we must improve the conditions of trade and investment in key commodities on which the economies of many developing countries are dependent, and we must set an example in improving the production and availability of food.

- Fifth, let us address the special needs of the poorest countries, who are the most devastated by current economic conditions, sharing the responsibility among old and newly wealthy donors.

The determination of the developing na-

tions to mobilize their own effort is indispensable. Without it, no outside effort will have effect. Government policies to call forth savings, to institute land reform, to use external aid and capital productively, to manage and allocate national resources wisely, to promote family planning—for these there are no substitutes.

But there must be international as well as national commitment. The United States is prepared to do its part. The senior economic officials of our government have joined with me in developing our approach. Treasury Secretary Simon, with whom I have worked closely on our program, will discuss it tomorrow in relation to the world economy. The large congressional delegation that will attend the session, and the seriousness with which they and the executive branch have collaborated in preparing these proposals, are evidence of my country's commitment.

We ask in return for a serious international dialogue on the responsibilities which confront us all.

* * *

Mr. President [Abdelaziz Bouteflika, Foreign Minister of Algeria], Mr. Secretary General, colleagues, ladies and gentlemen: I began today with the statement that we have, this week, an opportunity to improve the condition of mankind. This fact alone represents an extraordinary change in the human condition. Throughout history, man's imagination has been limited by his circumstances—which have now fundamentally changed. We are no longer confined to what Marx called “the realm of necessity.” And it has always been the case that the wisest realists were those who understood man's power to shape his own reality.

The steps we take now are not limited by our technical possibilities, but only by our political will. If the advanced nations fail to respond to the winds of change, and if the developing countries choose rhetoric over reality, the great goal of economic development will be submerged in our common failure. The speeches made here this week will be placed alongside many other lofty pro-

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nouncements made over decades past in this
organization on this subject, buried in the
archives of oblivion.

But we would not all be here if we did
not believe that progress is possible and that
it is imperative.

The United States has proposed a program
of action. We are prepared to contribute, if
we are met in a spirit of common endeavor.

-We have proposed steps to improve basic economic security—to safeguard the world economy, and particularly the developing countries, against the cruel cycles that undermine their export earnings.

-We have proposed measures to improve developing countries' access to capital, new technology, and management skills to lift themselves from stagnation onto the path of accelerating growth.

-We have proposed structural improvements in the world trading system, to be addressed in the ongoing multilateral trade

negotiations, to enhance developing countries' opportunities to earn their own way through trade.

-We have proposed a new approach to improving market conditions in food and other basic commodities, on which the economies and indeed the lives of hundreds of millions of people depend.

-We have proposed specific ways of giving special help to the development needs of the poorest countries.

My government does not offer these proposals as an act of charity, nor should they be received as if due. We know that the world economy nourishes us all; we know that we live on a shrinking planet. Materially as well as morally, our destinies are intertwined.

There remain enormous things for us to do. We can say once more to the new nations: We have heard your voices. We embrace your hopes. We will join your efforts. We commit ourselves to our common success.

A few weeks later, on September 22, 1975, HK addressed the regular session of the UNGA (# 42). He took note of the successful outcome of the Seventh Special Session and hoped its "spirit of conciliation" would be carried forward into other endeavors:

This century has seen war and cataclysm
on an unprecedented scale. It has witnessed
the breakdown of established patterns of
order and practices of international conduct.
It has suffered global economic depression
and cycles of famine. It has experienced the
birth of thermonuclear weapons and the pro-
liferation of armaments around the planet.
Ours is a world of continuing turmoil and
ideological division.

But this century has also seen the triumph
of the principle of self-determination and
national independence. A truly global com-
munity has begun to evolve, reflected in a
multitude of institutions of international co-
operation. We have shaped new methods of
peaceful settlement, arms limitation, and new
institutions to promote economic develop-
ment and to combat hunger and disease
worldwide. And our very presence here sig-

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nifies the hope of all nations that disputes and conflicts can be resolved by cooperative means.

As we deliberate the future, an event of potentially vast implication has just been achieved in this organization: the unanimous agreement produced by the seventh special session of the General Assembly on measures to improve the economic condition of mankind. Despite differences of ideology and approaches to economic development, the nations assembled here began to move toward the recognition that our interdependence spells either common progress or common disaster, that in our age no nation or group of nations can achieve its aims by pressure or confrontation and that the attempt to do so would damage everyone. They agreed to transcend the stereotypes of the past in the search for a cooperative future. The special session forged a sense of common purpose based on the equality and cooperation of states. Now we must dedicate ourselves to implementing this consensus.

Let us carry forward the spirit of conciliation into the deliberations of this regular session. Let us address the issues of world peace—the foundation of all else we do on this planet—with this same consciousness of our common destiny.

It is our common duty to avoid empty slogans and endless recriminations. We must instead sustain, strengthen, and extend the international environment we and our posterity will require for the maintenance of peace and the furtherance of progress.

Only in a structure of cooperation can disputes be settled and clashes contained. Only in an atmosphere of conciliation can the insecurity of nations, out of which so much conflict arises, be eased and habits of compromise and accommodation be nurtured. Social progress, justice, and human rights can thrive only in an atmosphere of reduced international tension.

The United States stands ready to dedicate itself to cooperative efforts to harmonize the different perspectives of the world community in creating a new sense of security and well-being. We do so not out of fear, for we are better able to sustain ourselves in situations of confrontation than most other nations. Nor do we do so out of a sense of guilt, for we believe that we have on the whole used our power for constructive ends.

We affirm our common destiny because of

our recognition of global interdependence and because global peace requires it. Indeed, there is no realistic alternative to shared responsibility in dealing with the international agenda of peace, security, economic well-being, and justice.

Let me set forth the views of the United States on the work we face in each of these areas.

* * *

## Building Economic Well-Being

In the last two years, the world community has been reminded dramatically to what extent economic relations are an essential foundation of the international order. Economic conditions not only underpin every society's ability to achieve its national goals, but all national economies are sustained by the global economic system. The conduct of our economic affairs will therefore determine to an extraordinary degree whether our political relations will be based on cooperation or conflict.

It would be one of history's most tragic ironies if, at a time when we are putting behind us the tensions of the cold war, we were to enter a new period of conflict between North and South, rich and poor. At the recently concluded special session, the United States called for an end to the sterile confrontation of the past. We stated that when the ancient dream of mankind—a world without poverty—becomes a possibility, our moral convictions also make it a duty. And we emphasized that only cooperation—not extortion—can achieve this goal.

The special session gives us ground for hope that—at least for the immediate future—a choice has been made to turn away from confrontation toward cooperation. The United States is proud to support the final document which is the product of the arduous effort and dedication of so many in this chamber.

The United States considers the achievements of the special session a beginning, not an end. As recommended by the final report, we must now move forward in available forums to give reality and content to the objectives on which we have agreed. In the difficult negotiations ahead, my government will participate energetically in a cooperative and conciliatory spirit.

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On December 16, 1975, HK addressed the Conference on International Economic Cooperation in Paris (# 47). This was the "North-South Dialogue" invoked by Giscard in accordance with the European strategy of engaging the Third World in direct discussions, somewhat in contrast with the American strategy of first trying to organize the industrial democracies. The specifics of his statement will be dealt with in later sections. HK began and closed with a statement of the American philosophy, as follows:

The challenge of our time is to build a stable and just international structure. This task has two principal dimensions. There is the imperative of peace—the more traditional problems of building security, resolving conflicts, easing tensions. These issues dominate the agenda of relations between East and West. No less urgent is the imperative of justice—the compelling requirements of global economic progress and social advance. These are now the major issues in the relationship between North and South. They, too, carry the potential for either conflict or order. Neither the goal of peace nor that of social justice can be achieved in isolation. We must succeed in both quests or we will succeed in neither.

Social justice and economic progress are our concerns at this conference. We meet here to launch the dialogue that has been so often urged and so long awaited. The convening of this meeting should itself be a reason for hope. For we believe it represents a commitment to the path of conciliation. It demonstrates a recognition that consumer and producer, industrial and agricultural, developed and developing, rich and poor, must together address the challenges of the global economy.

The United States will work with dedication and energy for a positive outcome. We will do so in our own self-interest and in the interest of a more just and prosperous community of nations. We will do our utmost to help mobilize the world's resources and the

talents of men and women everywhere in the service of economic progress and common well-being.

In the past two years we have all learned that no nation or group of nations can solve its economic problems in isolation. In a world which is becoming increasingly interdependent, we have witnessed that inflation and recession affect us all. We have seen that no country can achieve redress by exporting its economic difficulties or by exacting an exorbitant economic price from others.

But our deepest challenge is political. Economic distress magnifies the problems of government in all our countries, clouding the prospects of social peace and democratic institutions. We have seen that national economic problems thus become international; they spawn clashes of interest and protectionist pressures that strain the fabric of collaboration even among traditional friends. We have all come to understand that, if unresolved, the competing claims of developed and developing, consumer and producer, will thwart any effort to build a stable and progressive international structure.

Our future depends now not on blind economic forces, but on choices that statesmen make. The world's nations can struggle in national or ideological contention—or they can acknowledge their interdependence and act out of a sense of community. The United States has chosen the path of cooperation.

The United States, as the world's strongest economy, has demonstrated its resilience;

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we are on the road to recovery. We might best survive any new round of economic warfare. But it is my country's conviction that tests of strength benefit no nation. The approach that we took at the seventh special session of the U.N. General Assembly in September reflects our vision of a more positive future.

The special session reached consensus on an impressive range of economic problems. This commitment to cooperation can become a benchmark in human affairs—if its spirit is carried forward. We owe our people solutions, not slogans. So let us set to work. Let us implement the consensus of the special session and take up its unfinished tasks. Let us make this conference a decisive step toward their achievement.

## The Road to This Conference

We are here because two years ago the international structure was gravely tested by a crisis in energy. No problem on the international agenda is more crucial to the world economy. As this conference demonstrates, it has led us to a much broader consideration of the range of related issues.

The unprecedented expansion of the global economy in the decades since World War II relied upon the plentiful supply of energy at reasonable prices. It produced economic growth, fostered industrialization, and encouraged development in every quarter of the globe.

Thus the energy crisis—caused by a combination of the 1973 embargo and the fivefold increase in the price of oil—has dealt a serious blow to global stability and prosperity.

Inflation, recession, and payments balances significantly worsened in all the industrialized world and in those developing nations which had realized substantial progress toward industrialization. The poorest of the developing countries, struggling to make modest steps toward progress, were dealt the cruelest blow of all. Their hopes for growth were, and continue to be, thwarted. Their development planning has been disrupted. Even their agricultural production has been undermined by the increased cost

of petrochemical fertilizers. For the vast majority of the developing world, economic justice was poorly served.

In response to the energy crisis, the United States sought first to reach a consensus among the industrialized nations. We worked together to assure basic security against future arbitrary disruptions in oil supply and against potential oil-induced financial difficulties. We pledged ourselves to long-term cooperation in energy conservation and the development of alternative energy supplies. We agreed not to resort to protectionist measures; and we began unprecedented co-operation in our economic policies, as dramatized by the recent economic summit in Rambouillet.

These actions were not taken in a spirit of confrontation. Most are prudent steps of self-protection which have effect only if confrontation is provoked by others. Others involve an urgent program for the development of alternative sources to the benefit of all.

But the collaboration of the industrial countries has always been conceived as only part of a larger program for economic progress. From the beginning, we have foreseen an effort to develop a constructive dialogue leading to close and mutually beneficial long-term economic ties with oil-producing nations —so that our investment and technical support would contribute to their development and their prosperity would contribute to the worldwide expansion of trade and development. We recognize that the only durable basis for constructive relations is an economic system which fosters the prosperity of all. Each of us has a stake in the progress of others.

Last April, at the invitation of the President of France, we agreed to begin this discussion. The industrial nations wanted to focus on energy. The oil-producing and other developing nations wanted to give equal priority to a wider range of development issues, including prices and markets for other raw materials, and to international financial questions. The industrial nations regarded these issues as too varied and complex to be addressed effectively in a single forum.

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The April preparatory conference failed to reconcile these positions.

To demonstrate its desire for a constructive and cooperative solution the United States worked closely with other participants in developing a mutually satisfactory arrangement: energy, the concerns of the less developed countries about raw materials, development, and related financial matters would be addressed as part of a discussion of global economic problems, while maintaining enough distinction between them for a useful dialogue.

The United States is committed to a serious and wide-ranging program of cooperation with the developing world. My country understands full well, and has shown in its many proposals, that this dialogue must encompass issues of concern to all sides—including the needs of the many nations not in attendance here. For us, this clearly requires a discussion of the effects of energy prices on the world economy. For cooperation depends on mutual respect, mutual understanding, and mutual benefit.

To this end, at the seventh special session of the U.N. General Assembly three months ago, the United States made a series of proposals in several areas:

- To insure the economic security of developing countries against shortfalls in export earnings, food shortages, and natural disasters;

- To accelerate their economic growth by improving their access to capital markets, technology, and foreign investment;

- To better the conditions of trade and investment in key commodities on which many of their economies are dependent and to set an example in the vital area of food;

- To improve the world trading system and make it better serve development goals, and realize through the multilateral trade negotiations a strengthening of developing-country participation; and

- To address the especially urgent needs of the poorest countries devastated by current economic conditions.

The seventh special session ended on a note of conciliation and cooperation. The

spirit of the session was carried forward to the October preparatory conference in Paris, where the declaration laid the basis for our meeting today.

This will be the attitude of the United States here. Progress has been made in many areas, and this conference must move us forward.

## Conclusion

Ladies and gentlemen: The nations and economies of the world are many; our differences are great. But our reasons for pulling together are far greater. Therefore our dialogue here must be candid, but with a positive spirit and cooperative attitude. The prosperity, the progress, and indeed the security of the world may depend upon whether we succeed in finding realistic answers to the kinds of problems before us at this conference. For lasting peace around the globe will depend not only on containing conflict but mounting progress. It requires not merely the preservation of stability but the fulfillment of human aspirations.

The issues we face are often technical, but their implications could not be more profound. They go to the heart of our future. Only rarely in history does mankind consciously swing out from familiar, well-marked paths to move in new directions. Only rarely does humanity comprehend as clearly as we do today that change is imminent and that the direction to be taken is subject to human decision. The nations of the world face such an opportunity now.

We have the possibility of forging international relationships that will govern world affairs for the next several decades. We can bring together developed and developing, producer and consumer, in common endeavors—or we can go our separate ways, with every one of us paying the price for a lack of vision in lower standards of living and increased international tensions. Mutual interest should bring us together; only blindness can keep us apart.

The American people have always believed in a world of conciliation rather than a world

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ruled by intimidation, pressure, or force. My country, in spite of its own strengths and advantages, has chosen the path of cooperation. We will remain committed to that path. But we cannot travel it alone; others will have to join us. All of us here must base our policies on the reality that we have a practical and moral stake in each other's well-being.

I am confident of our cooperation and of our success. The result will be a fair and prosperous world economy of benefit to all nations, and with it new hope, opportunity, and justice for all peoples.

At UNCTAD IV, meeting in Nairobi on May 6, 1976, HK made a number of further proposals (# 64). He summed up the achievements of the previous year, and outlined new ideas particularly in the area of commodities. (These included Chuck Robinson's idea of an International Resources Bank. More about these proposals is on pages 198 ff). HK also made some philosophical observations about the process of economic development:

We begin this conference at a moment of opportunity. The world economy is recovering from a deep recession, my own country perhaps most rapidly. Increasing American demand for products of other countries will make a major contribution to recovery around the world. Many obstacles to sustained economic growth remain; but there are convincing signs that we have surmounted the worst part of the economic crisis and that before us, if we act with wisdom and energy, is the opportunity for a new and prolonged period of prosperity.

This, therefore, may be a decisive moment which offers us a brief, but special, opportunity to reinvigorate and improve the world's international economic system. Now

is the time to free the world from disruptive cycles of boom and bust and to enhance the opportunities of the developing countries.

The United States, better than almost any other nation, could survive a period of economic warfare. We can resist confrontation and rhetorical attacks if other nations choose that path. And we can ignore unrealistic proposals and peremptory demands. But the historic opportunity which is at hand would slip away. It is up to us, as the spokesmen of nations meeting in this world forum, to reach beyond the doubts and temptations of the moment toward the permanent international interests of us all. In so doing, we can take courage from the knowledge that the means exist to achieve a

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brighter future. It lies within our power to
shape a world where all men can live in
dignity and aspire to progress.

Let us therefore hold before us as the
goal of this conference, and of the dialogue
between developed and developing nations,
the motto of the Republic of Kenya:
"Harambee—work together for the good
of all."

Let us begin by building on the positive
accomplishments of the seventh special session
of the U.N. General Assembly last September.
At that meeting the industrial and
developing nations, in an encouraging demonstration
of consensus, put aside ideological
confrontation, declared their common purpose
of moving forward cooperatively, and
adopted an agreed agenda for action.

On behalf of President Ford, I call upon
this conference to accelerate the efforts and
continue the cooperative spirit which began
then. I will introduce new proposals on all
the priority concerns of this conference, to
reflect what we have heard of your ideas
and your aspirations in the Manila Declaration
and in other forums, including the Conference
on International Economic Cooperation
in Paris.²

These proposals represent the contributions of all relevant agencies of the U.S. Government, under the direction of the President. I have worked especially closely with my colleague Treasury Secretary Simon in shaping the program we are presenting.

The strong bipartisan support which our approach enjoys results from weeks of close consultations between the executive and both Houses of our Congress. It is demonstrated by the presence here of two distinguished Senators [Jacob K. Javits and Abraham A. Ribicoff] representing our two political parties. Other Senators and members of the House of Representatives will follow as your work proceeds.

The United States pledges its dedication
and willingness to cooperate over the decades

ahead. We do so with an open mind. We
want to hear your ideas and proposals. We
are here to exchange views and to forge a
fresh consensus.

The State of Our Efforts

Let me first review what our nations to-
gether achieved since last September.

We agreed at the seventh special session
to take measures to help insure basic economic
security against cycles that devastate
export earnings and undermine development.
In January, the International Monetary
Fund (IMF) expanded its compensatory
financing facility, as we had proposed, to
make available several billion dollars to
stabilize export earnings.

In September, we pledged to accelerate
economic growth by improving developing
countries' access to capital and new technology. To these ends, the United States, other industrial countries, and several oil-producing countries have begun to marshal increased capital, technological, and human resources to promote development. Negotiations have been completed to increase World Bank capital by $8 billion; we will contribute our fair share to a $6 billion increase in the resources of the Inter-American Development Bank; we will contribute to an expansion of the African Development Fund; we are actively participating in discussions on replenishment of the Asian Development Fund and Bank.

At the special session, the world community dedicated itself to improving trade and investment in key commodities. International solutions have already been achieved on several key commodity issues, including the successful negotiation of coffee and tin agreements. Progress is also being made in expanding the world's supply of its most vital commodity—food.

And finally, at the special session, the
world community made a commitment to
meet the special needs of the poorest coun-
tries, which have suffered the most from
recent economic dislocations. We have made
significant progress by providing financial
and technical assistance to increase food

²For texts of the Manila Declaration and Program of Action, adopted on Feb. 7, 1976, by the third ministerial meeting of the Group of 77, see U.N. doc. TD/195.

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production and by introducing new measures to help relieve crushing balance-of-payments problems of the poorest nations.

These achievements are only the beginning of the process. We are, this year, in the midst of what may well be the most extensive series of international negotiations on trade, finance, commodities, and development in history—involving more nations, addressing more issues, and affecting more people than ever before. This conference has a major role to play. In particular we can advance our work in four key areas:

First, we must make renewed efforts on commodity issues, including the problems of resource investment and trade. Commodities—energy, food, and other primary products—are the building blocks of growth and prosperity. For many countries, development of resources is the key to industrialization, employment, decent incomes, and healthy diets. All nations need adequate supplies of primary products and fair compensation for their production. Solving the complex of these issues is a critical test of our ability to work together systematically to expand the world's wealth for the benefit of all.

Second, we must design a far-reaching long-term program to accelerate technology transfer. The quantity of capital investment by itself does not assure sustained development. There must be as well continuous improvements in productivity that only new technology and trained local manpower can bring. The subject deserves high priority, and comprehensive efforts will be required.

Third, we must deal with serious balance-of-payments and debt problems which face a number of developing countries. Rising import costs caused in large part by higher oil prices, and reduced export earnings due to recession in industrialized countries, have created unprecedented international payments problems. An improved world economy will automatically ease the problem for many countries. Nevertheless we must continue to seek means of assistance for the particular problems of certain developing countries.

Fourth, we must continue to respond to the special and urgent needs of the poorest countries. Helping these nations will not only demonstrate the capacity of the international economy to serve all countries equitably; it will also reflect our collective sense of responsibility.

## Dimensions of Task of Development

Economic development is a task of many dimensions. Whatever may be our differing perspectives, the United States believes that a number of conclusions stand out clearly:

- Development is a mutually reinforcing endeavor. There is nothing permanent about the distinction between the developed and developing worlds. Developed countries thrive and advance most surely when the international economy grows vigorously and steadily. As the United States sees other nations develop and industrialize, we feel renewed confidence in the world economic system and in our own economic future. Sustained growth and development require that we work together cooperatively.

- Development involves mutual responsibility. International cooperation cannot be one-sided. The strength of the industrial countries must be regarded as a trust for the progress of all; the developing countries only hurt themselves if they weaken that strength through contrived vacancies, cartels, embargoes, or arbitrary seizures of property. At the same time, the developed countries have an obligation to do their utmost to spur development. Our efforts here must take into consideration the concerns and the contributions of all countries, developed and developing, producer and consumer, East and West, North and South.

- Development is a process of change and innovation. It must respond not only to rapidly changing technology but also to the evolution of political attitudes. The old relationships of donor and recipient are increasingly paternalistic and anachronistic to the

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recipient; they may also come to seem a one-
sided burden to those who have long been
donors. We must fashion a new sense of co-
operation that is based on the self-respect
and sovereign equality of all nations. Each
nation must find its own path to develop-
ment which allows it to retain its self-
respect and identity, its culture, and its
ideological preference. But development it-
self is not a function of ideology; it must
unite practical solutions and a philosophy
of international cooperation. It cannot grow
from doctrines of confrontation and the ex-
exploitation of despair.

—Development is a human enterprise. It
is the talents and efforts of individuals
which make development a reality, and it
is they who are its ultimate beneficiaries.
Our first aim is the minimum essentials of
life—food, clothing, shelter—and the relief
of human suffering and monotony and debil-
itating illness and ignorance and demeaning
servitude to others. Then development must
look beyond survival to provide opportunities
for education, greater personal freedom,
and individual dignity and self-respect. Fi-
nally, development must deal with the quality
of life: the dignity of the individual, per-
sonal freedom, and equality of opportunity
regardless of race, religion, sex, or political
belief.

The magnitude of the task before us will
require unprecedented international col-
laboration. No nation alone can surmount—
and only together can all nations master—
what is inescapably a global challenge of
historic proportions.

But we are not confronted by overwhelming
odds or by intractable obstacles. We have
it in our power to achieve in our generation

a rate of economic advance that has no paral-
lel in human experience.

In each age, men and women have striven
for greater prosperity and justice and dig-
nity. Yet always in the past there have been
setbacks; history has recorded a surfeit of
misery and despair. Our age is the first
where we can choose to be different. And
therefore we must.

If we succeed, this decade could be remem-
bered as a turning point in the economic and
political evolution of man. The new institu-
tions and mechanisms we create could be
perceived as building blocks of international
cooperation that strengthened the world's
sense of community. The implications for
world peace, as well as for economic cooper-
ation, are vast.

The United States proceeds from the con-
viction that both morality and practical in-
terest point in the same direction, toward a
dedicated enterprise of cooperation. If we
are met in a cooperative and realistic spirit,
we are prepared to offer our national capac-
ities in support of a historic extension of
the global economy and global development.

So let us get down to business. Let us make
this task a priority of all our foreign poli-
cies. Let us set our sights high, but let us
not make our desire for the ideal block
achievement of the attainable. Let us reach
agreement on practical steps that improve
the lot of our fellow man. We owe our peo-
ple performance, not slogans; results, not
rhetoric.

The United States extends its hand to
those who will travel with us on this road
to a more humane and bountiful future. We
must travel it together, and we must take
another step at this conference,

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One of the main topics discussed at the OECD Ministerial
in Paris on June 21, 1976, was the industrial democracies'
policies toward the Third World. HK's address (# 70) focused
on the question of economic development and how to promote it.
Development, said HK, was a long-term process that depended in
the first instance on the efforts of the developing countries
themselves. It also required coordinated policies among
the industrial nations. HK hoped that the OECD could fulfill
such a coordinating role:

The Relationship Between North and South

One of the most urgent and compelling
challenges that summon our cooperation is
the relationship between the industrial and
the developing nations. The new era of inter-
national cooperation we seek must include
economic relations that offer mutual pros-
perity and widening opportunity for all the
peoples of the world.

Every nation has a stake in global stability
and world peace. But the ultimate good must
be to look beyond the maintenance of peace
to a world which offers its children a hope
of a better future.

The United States has made its commitment. We have demonstrated our determination at the seventh special session of the U.N. General Assembly, at the Conference on International Economic Cooperation in Paris, at Kingston in January, and at the UNCTAD Conference in Nairobi last month.

167

Our efforts begin from the conviction that an effective international system must be founded upon a consensus among all nations and peoples. The world community which is our ultimate aspiration can only be realized if all nations and peoples can pursue their goals with a sense of participation and an awareness that their concerns are heeded. If we are to live in a stable world, the preponderant number of nations must be persuaded that their legitimate concerns are taken seriously.

The poor nations cry out for development. Their objectives are clear: economic progress, a role in international decisions that affect them, and an equitable share of global economic benefits. The objectives of the industrialized nations are equally clear: widening prosperity for all peoples produced by an open world system of trade and investment with expanding markets for North and South. We want to see stable and equitable development of the world's resources of food, energy, and raw materials as the fundamental basis for a prosperous world economy.

Thus, the objectives of the industrial democracies and those of the developing nations should be complementary. The process of building a world community must therefore be shared by nations of both North and South and must address the issue of economic development in the context of growing global prosperity.

But this is not inevitable. Effective cooperation presupposes that both sides face certain realities without illusion.

The most critical of these realities is that development is a long-term process. Sustained economic development cannot possibly result from any one conference or any one set of proposals. It will depend primarily upon the internal effort, the domestic policy, and the national will of the developing countries themselves. In most cases the effort will extend over decades. Often this will require painful short-term sacrifices for longer term gains. Development cannot be created by rhetoric or by parliamentary victories in international forums.

Development further requires the sustained and collective effort of the industrial countries. The role of the industrial democracies is critical, for we possess the largest markets and most of the world's capital and technology. Thus real development presupposes a serious, unemotional, constructive North-South dialogue.

In such a dialogue it is futile for one party to seek to impose solutions to the problems of development on another. An atmosphere of extortion or pressure, unworkable proposals, or excessive reliance on parliamentary maneuvers will ultimately undermine public support in the only countries capable of contributing effectively to development.

We of the industrial democracies have a special responsibility. What we do—or fail to do—is critical to the future of the countries of the Third World. If we substitute competition among ourselves for a dispassionate analysis of the issues, the development process will falter. Our resources will be inefficiently scattered or misallocated; projects will too often prove fruitless for lack of careful analysis or want of wider support. We do no one a favor when we substitute rhetorical concessions for intelligent and realistic proposals that link the interests and concerns of both sides in a prospering global economy. Those who curry short-term favor may mortgage the long-term future.

It is imperative that the North-South dialogue advance in a way which benefits both sides. In the long run, progress, stability, and peace depend upon it.

The United States has done its utmost to be forthcoming in the dialogue. We have strained our domestic processes to develop pragmatic proposals to meet real problems in our relations with the developing world. As our economies improve and as we, together with the developing world, identify new areas for cooperation, we can look forward to widening global cooperation which can serve the interests of all.

The spirit of cooperation necessary between North and South requires first a commitment to cooperation among the industrial nations. This is not a call for confrontation

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with the Third World. It is an indispensable step we must take if we are not to fragment our efforts and fail in our objectives.

The United States believes that this or-
ganization should focus on three areas where
our cooperation is most necessary and would
be most effective:

- We must improve our ability to concert our development efforts in international forums, for it is in these meetings that ideas are launched, compromises are made, and political directions are set.

- We must enhance our collaboration in our bilateral and multilateral aid programs; for our resources are limited, and closer alignment of programs is essential for their effectiveness.

- We must develop a longer term strategy for development which integrates the diverse strands of North-South policy, including for- eign aid, technology transfer, financial policy, and trade. For development is a compre- hensive and never-ending process with impli- cations for every area of the international economic system.

Let me discuss each area in turn.

First, we must improve the coordination
of our positions at major international con-
ferences. Recent unfavorable experiences at
UNCTAD in Nairobi and at other interna-
tional forums should make clear the impor-
tance of this step. We in this organization
have supporting mechanisms for coordina-
tion of positions on energy, commodities,
finance, and development, but their effective-
ness has been frequently less than adequate.
For the remainder of this year we will be
relying on these bodies to continue to sup-
port our work in the Conference on Interna-
tional Economic Cooperation. It is therefore
imperative that we review now our recent
experience with the objective of strengthen-
ing the coordinating role of each OECD sup-
port mechanism as well as the relationship
among them.

The United States recommends that the
Secretary General undertake an immediate
examination of the issues and present recom-
mendations to the Executive Committee in

Special Session on ways in which we may
more closely align our positions.

We suggest as well that this organization
take a more active role in developing views
on key North-South issues than it has in the
past. We believe this could most fruitfully
be done by identifying in advance of inter-
national meetings specific issues of major
concern to industrialized countries and ar-
ranging for consultations to develop mutu-
ally supporting positions. It makes no sense
to work out our differences under the pres-
sure of deadlines and of other participants
at international conferences.

The next several months will be a test of
our ability to work together in a variety of
international settings. The agenda of confer-
ences is full. We will be considering on a
case-by-case basis measures to improve the
functioning of individual commodity mar-
kets, including the reduction of excessive
price fluctuations and methods of buffer
stock financing. We will also be translating
the analysis of the first six months of the
year into concrete results in CIEC. In this
forum, the United States looks forward to
visible and concrete achievements in energy,
raw materials, investment, trade, and meas-
ures to address the problems of the poorest
countries. We will want:

- To explore possibilities for further con-
sultations on energy, including ways to assist
developing nations that have no energy
resources;

- To facilitate progress on commodity dis-
cussions, including ways to improve the
functioning of individual commodity mar-
kets; and

- To begin work on the International Re-
sources Bank proposal, which we see as relat-
ing to the work of all the CIEC commissions,
particularly those dealing with energy and
raw materials.

Second, we must increase the effectiveness
of our bilateral and multilateral aid efforts
in addressing specific problems in the devel-
oping world. The OECD Development Assist-
ance Committee has done important work to
improve and coordinate development assist-

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ance policies. There are, as well, over 20 consultative groups working with regard to specific developing nations. We should review our coordination in all these areas. We may consider streamlining some of those mechanisms and eliminating duplication.

We must seek to enhance the coordination of assistance policies and programs which have a regional or even continental focus. The Club des Amis du Sahel is a recent successful effort to concert our resources to combat the problems of that African subregion. We should explore whether there are other regions, in Africa or elsewhere, where similar approaches are needed. The recent initiative by the President of France for focusing joint attention on specific problems on the African Continent is an example of the kind of effort we must make together in the future.

Third, we must devote a major portion of our efforts to longer range planning for global development. The problem of growth will not go away. No one policy will be decisive; no one conference will devise permanent solutions. We must begin to focus honestly and carefully on the development challenge through the distant future.

A high priority in this effort must be to consider together the various development issues we have been addressing separately. Development policies can be either mutually reinforcing or they can undermine one another. We must find a way to look at development as a comprehensive and integrated whole, harmonizing our long-range planning efforts in trade, aid, investment, and technology. These individual policies need to be placed into a larger coherent plan so that the industrial nations' development efforts can more efficiently respond to the most pressing issues in the developing world.

To achieve a more effective integrated development strategy, the United States proposes that OECD countries decide now to review the entire range of North-South issues which we will be addressing over the remainder of this decade and beyond. Over the next year we should develop a consistent and comprehensive set of objectives and strategies.

At the same time, we should now move to strengthen the institutional arrangements within this organization for handling North-South issues. There should be a central focal point in the OECD for consideration of all such activities. This will give a greater political impetus to our efforts. And it should also stimulate greater consideration for the needs and interests of developing nations in the ongoing work of specialized OECD committees.

The kind of coordination which I have suggested will require attention at the highest levels of our governments. It will, of course, also require compromises on policies and priorities which each of us has developed in the past. But it is our best, perhaps our sole, chance to accelerate the pace of constructive progress in our relations with the Third World while not undermining our relations with each other.

## The Imperative of Cooperative Action

The nations assembled in this room proceed from two main premises: the interdependence among the OECD nations and our common desire to help shape a new era of global economic cooperation among all nations.

The central task before the industrialized democracies of the OECD is to give new focus and purpose to our own cooperative economic action. Economics is only part of that enterprise. The choices before us and the decisions we take will, above all, reflect our perception of ourselves as peoples and as nations. The tasks are long term, and they demand that we extend our line of sight beyond immediate technical issues or political controversies to more distant horizons.

Ours is a time when the centers of global power and influence are many and diverse. And ours, therefore, is a choice between cooperation or chaos. Today more than ever, the industrial democracies require leadership determined not to adapt to reality, but to shape it. Circumstances have provided us with a clear understanding of our interdependence, and our efforts to translate this reality into common progress are well begun.

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HK elaborated thoughtfully on the theme of what develop-
ment required in the Alastair Buchan Memorial Lecture in
London on June 25, 1976 (# 71). Development was an "arduous
long-term enterprise" and required maximum efforts by the
developing countries themselves. It also required coordination
among the democracies:

If the economic strength of the industrial democracies is important to the Socialist countries, it is vital for the developing world. These nations seek to overcome pervasive poverty and to lift the horizons of their peoples. They ask for an equitable share of global economic benefits and a greater role in international decisions that affect them.

The process of development is crucial not only for the poorer nations but for the industrial nations as well. Our own prosperity is closely linked to the raw materials, the markets, and the aspirations of the developing countries. An international order can be stable only if all nations perceive it as fundamentally just and are convinced that they have a stake in it. Over the long term, cooperative North-South relations are thus clearly in the interest of all, and the objectives of industrial and developing countries *should* be complementary.

However, the North-South dialogue has been far from smooth. Tactics of pressure and an emphasis on rhetorical victories at conferences have too often created an atmosphere of confrontation. Such attitudes obscure the fundamental reality that development is an arduous long-term enterprise. It will go forward only if both sides face facts without illusions, shunning both confrontation and sentimentality.

Far more is involved than the mechanical application of technology and capital to poverty. There must be within the developing country a sense of purpose and direction, determined leadership, and perhaps most important, an impulse for change among the people. Development requires national administration, a complex infrastructure, a revised system of education, and many other social reforms. It is a profoundly unsettling process that takes decades.

For many new countries it is in fact even more difficult than similar efforts by the Western countries a century ago, for their

social and geographic conditions reflect the arbitrary subdivisions of colonial rule. Some face obstacles which could not be surmounted even with the greatest exertions on their own. Their progress depends on how well the international community responds to the imperatives of economic interdependence.

It is senseless, therefore, to pretend that development can proceed by quick fixes or one-shot solutions. Artificial majorities at international conferences confuse the issue. Confrontational tactics will in time destroy the domestic support in the industrial countries for the forward-looking policy which the developing countries so desperately need.

The industrial democracies have special responsibilities as well. Development requires their sustained and collective cooperation. They represent the largest markets and most of the world's technology and capital. They have an obligation to show understanding for the plight of the poorest and the striving for progress of all developing nations. But they do the developing countries no favor if they contribute to escapism. If they compete to curry favor over essentially propagandistic issues, contributions will be diluted, resources will go unallocated, and unworkable projects will be encouraged.

The developing countries need from us not a sense of guilt but intelligent and realistic proposals that merge the interests of both sides in an expanding world economy:

- First, we must develop further the mechanisms of our own cooperation. To this end the United States has made a number of concrete proposals at the recently concluded OECD meeting.

- Second, the industrial democracies should coordinate their national aid programs better so that we use our respective areas of experience and technical skill to best advantage. [French] President Giscard d'Estaing's proposal for an integrated Western fund for Africa is an imaginative approach to regional development.

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In HK's last UNGA address, on September 30, 1976 (# 76), there was an additional discussion of US policies toward the developing world and the theme of economic interdependence:

## Economic Development and Progress

The economic division of our planet between the Northern and Southern Hemispheres, between the industrial and developing nations, is a dominant issue of our time. Our mutual dependence for our prosperity is a reality, not a slogan. It should summon our best efforts to make common progress. We must commit ourselves to bring mankind's dreams of a better life to closer reality in our lifetime.

There are many reasons why cooperation has not made greater strides:

- The industrial democracies have sometimes been more willing to pay lip service to the challenge of development than to match rhetoric with real resources.

- The oil-producing nations command great wealth, and some have been generous in their contribution to international development. But the overall performance in putting that wealth to positive uses has been inadequate to the challenge.

- The countries with nonmarket economies are quite prepared to undertake verbal assaults, but their performance is in inverse ratio to their rhetoric. Their real contribution to development assistance has been minimal. Last year, for example, the nonmarket economies provided only about 4 percent of the public aid flowing to the developing nations.

- The developing nations are understandably frustrated and impatient with poverty, illiteracy, and disease. But too often they have made demands for change that are as confrontational as they are unrealistic. They sometimes speak of new economic orders as if growth were a quick fix requiring only that the world's wealth

be properly redistributed through tests of strength instead of a process of self-help over generations. Ultimately such tactics lose more than they gain, for they undermine the popular support in the industrial democracies which is imperative to provide the resources and market access—available nowhere else—to sustain development.

The objectives of the developing nations are clear: a rapid rise in the incomes of their people, a greater role in the international decisions which affect them, and fair access to the world's economic opportunities.

The objectives of the industrial nations are equally plain: an efficient and open system of world trade and investment; expanding opportunities and production for both North and South; the reliable and equitable development of the world's resources of food, energy, and raw materials; a world economy in which prosperity is as close to universal as our imagination and our energies allow.

These goals are complementary; indeed they must be, for neither side can achieve its aims at the expense of the other. They can be realized only through cooperation.

We took a major step forward together a year ago, at the seventh special session of this Assembly. And we have since followed through on many fronts:

- We have taken steps to protect the economic security of developing nations against cyclical financial disaster. The newly expanded compensatory finance facility of the International Monetary Fund (IMF) has disbursed over $2 billion to developing nations this year alone.

173

—An IMF trust fund financed by gold sales has been established for the benefit of the low-income countries.

—Replenishments for the World Bank, the Inter-American Development Bank, and the Asian Development Bank will provide additional resources for development.

—Worldwide food aid has expanded. We have committed ourselves to expand the world supply of food. With a U.S. contribution of $200 million, we have brought the International Fund for Agricultural Development close to operation.

—The major industrial nations have moved to expand trade opportunities for the developing world. We have joined in a solemn pledge to complete by next year the liberalization of world trade through the Tokyo round of multilateral trade negotiations. For its part, the United States has established a system of generalized preferences which has significantly stimulated exports from developing nations to the United States.

The United States continued this process by putting forward a number of new proposals at the fourth ministerial United Nations Conference on Trade and Development in May 1976. We proposed a comprehensive plan to improve the capacity of the developing countries to select, adapt, improve, and manage technology for development. We committed ourselves to improvements in the quality of aid, proposing that a greater proportion of aid to poor countries be on a grant basis and untied to purchases from donor nations. We agreed to a serious effort to improve markets of 18 basic commodities.

These measures undertaken since we met here just a year ago assist—not with rhetoric and promises, but in practical and concrete ways—the peoples of the world who are struggling to throw off the chains of poverty.

Much remains to be done.

First, the application of science and technology is at the very heart of the development process. The United States, conscious of its pioneering role in technology, has put

forward three basic principles, which we will support with funds and talent:

—To train individuals who can identify, select, and manage the future technology of the developing world;

—To build both national and international institutions to create indigenous technology, as well as adapt foreign designs and inventions; and

—To spur the private sector to make its maximum contribution to the development and transfer of technological progress.

To achieve these goals, we are today extending an invitation to the World Conference on Science and Technology for Development, now scheduled for 1979, to meet in this country. In preparation for that meeting, we have asked members of the industrial, academic, and professional scientific communities throughout the United States to meet in Washington in November. They will review the important initiatives this country can take to expand the technological base for development, and they will strive to develop new approaches.

Second, the ministerial meeting of the Conference on International Economic Cooperation in Paris should be given new impetus. We are making several new proposals:

—We will seek to help nations facing severe debt burdens. For acute cases we will propose guidelines for debt renegotiation. For countries facing longer term problems, we will propose systematic examination of remedial measures, including increased aid.

—We will advance new ideas for expanded cooperation in energy including a regular process of information exchange among energy producers and users, and an expanded transfer of energy-related technology to energy-poor developing nations.

Third, the industrial democracies have been far too willing to wait for the demands of the developing countries rather than to advance their own proposals. Now, however, the OECD [Organization for Economic Cooperation and Development] countries, at the suggestion of the United

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States, have agreed to examine long-range
development planning and to develop a
more coherent and comprehensive ap-
proach to global growth and economic jus-
tice.

Fourth, natural disaster each year takes
thousands of lives and costs billions of dol-
lars. It strikes most those who can afford it
the least, the poorest peoples of the world.
Its toll is magnified by a large array of
global issues: overpopulation, food scar-
city, damage to the ecology, and economic
underdevelopment. The United Nations has
a unique capacity to address these global
concerns and thus improve man's odds
against nature. We urge this body to take
the lead in strengthening international co-
operation to prevent and alleviate natural
calamity.

Our dream is that all the children of the
world can live with hope and widening op-
portunity. No nation can accomplish this
alone; no group of nations can achieve it
through confrontation. But together there
is a chance for major progress—and in our
generation.

Finally, HK spoke on November 17, 1976, to a National Meeting on Science, Technology, and Development at the Department of State (# 78). It was a gathering of representatives of industry, universities, foundations, research institutes, private voluntary organizations, and labor unions. HK spoke in a philosophical vein about the problem of world order, and why a concern for economic development was essential to American objectives in foreign policy. At the same time, Third World nations had to bear the major responsibility for development efforts and had to conduct themselves in a spirit of reciprocity and cooperation:

The fundamental problem is how to create
an international system, or to participate in
creating an international system, in which
the principal participants have a sense of be-
longing. That doesn't mean that everybody
has to be satisfied, but it does mean that
everybody, or at least all those countries or
groups that can upset it, feel either that
their basic concerns have been met or that a
mechanism exists by which their concerns
can be met.

If this does not exist, then those who feel

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themselves disadvantaged, unjustly treated, dispossessed, will band together, and they will join any other group that is willing to undermine the existing order. And then international problems will be settled by endless confrontations, by contests of strength; and we will be living in an environment of political, economic, and, occasionally, military conflict.

Now, the United States is the strongest nation in the world. The United States could survive better than most, in fact probably better than any other country, in such an environment. But it is an environment that would tax even our resources. It would be in the long term incompatible with the sort of economy with which we are familiar and under which we have flourished. And above all, it would be inconsistent with the fundamental American values.

We have to live in a world, not where everybody agrees with us, but where our values have some relevance. We do not wish to live in a siege mentality or in a world in which only might makes right. And therefore, while I know that many of you here are hardheaded businessmen, and while I have been told by all of my advisers never to stray from the emphasis on self-interest, I would like to point out that our self-interest is not incompatible with the world interest and that only to the extent that we can make our self-interest relevant to the world interest can we really prosper as a country and survive with our basic institutions intact.

This is the general problem, as I see it, of the relationship of the tasks that all Administrations since the war have faced in one way or another. It has become particularly acute in recent years because of the beginning cartelization of some of the world's economy; because of the organization of some of the developing countries into political units operating more and more as a bloc; because the United States, while still the most powerful country in the world, is no longer the predominant country it was in the fifties and early sixties—nor can it be.

Therefore our foreign policy problem has become, as it has been for most other nations throughout their history, how to contribute

to a world that can be both secure and make progress, how to do this with resources that are finite in relation to all of the objectives we could be pursuing at any one time, and how to build a consensus of like-minded states.

Now, the trends that I have described have resulted in some tendencies which we find very unfortunate. Too many of the developing countries are following a radical rhetoric that is incompatible with their own progress and indeed with the achievement of the goals they profess. Too many of them seek to achieve by confrontation and extortion what can only result, and what can only be significant, through the voluntary cooperation of all nations.

While it is crucial for the United States to take an enlightened and farsighted view about the process of development, while it is foolish and shortsighted for us to be negligently and petty in our approach, it is also true that what we offer cannot appear to be, and indeed cannot be, the result of conditions imposed on us by those who will be the primary beneficiaries of the process of development.

So, we have to steer a course in which we show that we are concerned about the problems of the greater part of humanity, but where we also have a right to ask of those countries that they remember that 90 percent of the transfer of all capital from private and public sources comes from the industrial democracies, that there are no realistic alternative sources, and that the process must be a reciprocal one.

The United States, in my view, has an obligation to respond to some of the fundamental concerns of our times. The developing countries must have an enhanced capability of access to worldwide capital markets, especially private capital markets. The markets for the primary commodities sold by developing countries should be stable and efficient. Special measures will be needed to help developing countries find new markets for the goods and services which they will be increasingly able to produce. And the international community should help the developing countries to develop, transfer, adapt, and

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manage technology appropriate to their needs.

On the other hand, we have a right—indeed an obligation—that the process of development is not something that is handed by one group of nations to another group of nations. In all societies it was a process that extended over decades. And indeed in all other societies it was a process that extended over generations. It needs domestic disciplines. It requires a process of education. In many societies it requires an adaptation of our basic values. There is no substitute for hard effort by the developing countries in their own process of development, and no one should create the illusion that there can be.

Developing countries must find a way to encourage savings, reward initiatives and ability, spread education and training, and expand opportunities for all their people.

It is also clear that a constructive world order must have provisions in which foreign investors can operate in a stable and peaceful environment as long as they may give serious contributions to the social and economic progress of the host country. But they must be free of harassment and unreasonable restraints. And it is indeed one of the curious phenomena of this period that, for some reason, transfer of governmental capital is considered in many countries more acceptable than private capital, even though the capacity of governments to attach restrictive conditions is infinitely greater than the capacity of private capital to attach restrictive conditions.

So, in the process of development we need a sense of obligation on the part of the developed countries and a sense of participation and reciprocity on the part of the developing countries.

* * *

I will talk about the subject that I know something about, which is that if we are going to have an international environment in which our economy can prosper at all—not any one business, but our economy in its present form—then we must be dealing with societies that consider us relevant to their concerns. We cannot abolish the concern for development, nor do we want to abolish it. It is an expression of our entire history. For the United States not to take a leading role in this would be to abdicate from one of the principal currents of our time. It would be to make us irrelevant to the concerns of the major part of humanity. I know that it would undermine the effective conduct of our foreign policy. I must believe that over a period of time it would undermine the effective operation of our economic institutions around the world.

So, in the broad self-interest of the United States, which in this sense is identical with the world interest, development must be one of the increasing concerns of our country.

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## Energy

We have already seen in an earlier section (pp. 37-49) that cooperation among the oil-consuming nations was the central element of HK's energy strategy. This was not inconsistent, he argued, with a serious dialogue and ultimate cooperation with the producers. Even in the Pilgrims speech of December 12, 1973 (# 12), which launched a major push for consumer solidarity, the producers were invited to join "from the very beginning." Some areas of consumer-producer cooperation were suggested:

> The Energy Action Group should not be an exclusive organization of consumers. The producing nations should be invited to join it from the very beginning with respect to any matters of common interest. The problem of finding adequate opportunity for development, and the investment of the proceeds from the sale of energy sources, would appear to be a particularly important area for consumer-producer cooperation.

Energy also featured prominently in the general discussion of economic and political relations with the Third World, as seen in the section just preceding. Other themes related to energy and the Third World included:

- concern for the energy problems of the poorest nations, exacerbated by the oil shocks,

- warnings to the producers that the energy crisis would rebound to their detriment,

- and US willingness to assist the oil producers in diversifying their economies.

Some of these themes of consumer-producer relations were evident in HK's speech to the Washington Energy Conference, February 4, 1974 (# 10):

The threat to the world's poorer nations is even more profound. At present prices the less developed nations will face a current account deficit of $25-$30 billion in 1974, of which more than $10 billion is caused by the increase in oil prices. This deficit is three times the total aid flow of the entire world in recent years. Neither the developing nations nor traditional aid donors can finance such a sum. Even the attempt would destroy two decades of hard-won progress, leaving in its wake a legacy of political tension, social turmoil, and human despair.

Moreover, as a direct result of the oil price hikes the poorer nations' supply of crucial

fertilizer has been severely reduced in recent months. Fertilizer prices have at least doubled, raising the specter of famine. We cannot permit this to happen.

The producing countries themselves will not be spared these consequences. Their unprecedented opportunity for dramatic and rapid economic progress cannot escape the effect of global inflation, mounting restrictions in the world's trading and monetary system, and the political tensions of unbridled competition. A major task before this conference is to begin creating a framework of cooperation that will fulfill both the hopes of the producing and the needs of the consuming nations.

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In his speech to the Sixth Special Session of the UNGA, April 15, 1974 (#13), HK promised the oil-producing countries that the United States would have a forthcoming attitude to assisting them in diversifying and developing the technological level of their economies:

In such a dialogue, the United States will take account of—and take seriously—the concern of the producing countries that the future of their peoples not depend on oil alone. The United States is willing to help broaden the base of their economies and to develop secure and diversified sources of income. We are prepared to facilitate the

transfer of technology and to assist industrialization. We will accept substantial investment of the capital of oil-producing countries in the United States. We will support a greater role for oil producers in international financial organizations as well as an increase in their voting power.

To the Southern Governors Conference in Orlando on September 16, 1975 (#40), HK reiterated that we were prepared for a mutually beneficial relationship with the oil producers; they themselves would be hurt by its absence:

At the same time, we will seek a new relationship with the oil-producing nations. We are natural partners, not adversaries. Consumers must have reliable access to oil supplies at reasonable prices. To invest their new oil wealth, the producers must become major participants in the global financial and economic system. And to convert their new wealth into goods, they must become major importers of our products. We are ready to cooperate with the oil producers in linking our economies on equitable terms. We are prepared to shape new constructive relationships.

But another oil price rise would severely jeopardize these hopes. It could set off a relentless sequence of action and reaction, to the detriment of the entire world community. The expansion of the economies of the industrial countries would be inhibited by

fears of further price rises and permanent inflation. OPEC oil exports would stagnate, leading to demands for even further price hikes. The most seriously affected victims would be the developing countries; their exports would plunge, their energy costs would soar, and their crippling debt burden would mount even higher. All nations have an interest in avoiding this.

Whatever the decision of the oil producers, the United States cannot entrust its political and economic destiny to decisions made elsewhere. Congress and the Administration must cooperate in a determined energy policy so that this country will recapture control over our future. Together with our allies, we will work to reverse the conditions that have enabled oil prices to be set unilaterally. As the largest energy consumer, our leadership is decisive. We will not fail our responsibility.

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At the CIEC conference on December 16, 1975 in Paris (#47), HK summed up the importance of a cooperative North-South policy on energy. The United States had a number of concrete proposals:

## The Work of the Commissions

The four commissions that this conference is establishing have much work before them:

- The Commission on Energy should promote an effective world balance between energy demand and supply. It should work for practical cooperation among industrialized and developing countries to develop new energy supplies. And it should lay the foundations of a mutually beneficial long-term relationship between energy producers and consumers.

* * *

## Energy

First, energy. The application of science and technology to tap the vast energy potential imprisoned beneath the earth, radiated by the sun, generated by the movement of wind and water across the earth's surface, or locked in the core of matter is fundamental to the hopes of millions to pull themselves above a bare struggle for existence. For the expansion of the global economy for both developed and developing countries depends heavily on our harnessing and efficiently employing the world's energy resources.

Some nations are particularly well endowed with these resources; some have the scientific and technological expertise to explore and utilize that potential. The international flow of energy, investment capital required to produce it, and goods produced from fuels have become in effect a global energy system which sustains all our economies. Only through international cooperation can all nations benefit from these processes and can the world economy harness its energy resources most effectively.

The United States is committed to a cooperative approach. We have much to offer. We have produced more energy than any other nation in the history of mankind, our energy science and technology are the most advanced, and we have tremendous potential for future energy development in our country and abroad.

The United States also has much to gain from cooperation. Our energy needs are the world's largest; our ability to raise living standards for all our citizens depends on greater energy production and the more efficient use of energy resources.

This dialogue and this conference have these tasks:

- First, it is time to reach a common evaluation of the relationship between changes in energy prices and the stability and performance of the world economy.

The abrupt and arbitrary increase in the price of oil has been a major factor in rates of inflation and unemployment unprecedented since the 1930's. It has led to serious balance-of-payments deficits, indirectly through global recession and directly through higher priced imports.

By extraordinary effort, the industrial countries, on the whole, put their payments back in balance over the last year, although at a high cost to the well-being of their peoples. Thus the immediate burden of the massive petrodollar deficit is now borne largely by the developing countries which have little or no oil resources.

Developing countries, by definition, tend to have less of a margin to reduce consumption, to restructure energy use, or to shift to alternative sources when the oil price rises. They are the most vulnerable—and the most wounded.

A lower oil price would make possible more rapid economic recovery around the globe. It would assist the developing countries by easing their enormous balance-of-payments burden and their debt burden and increasing foreign demand for their exports. A lower price, along with stability of supply, would also benefit producer nations over the long term by easing the urgency for consuming countries to develop alternative supply sources.

Conversely, any further increase in prices would seriously hamper economic recovery, retard international trade, compound the in-

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ternal difficulties of many countries, weaken
the ability of the advanced nations to assist
the developing, and strain the fabric of inter-
national cooperation.

It is time for a serious discussion of this
issue. We are prepared to make a sustained
effort to achieve understanding.

—Second, we must collaborate to find new
sources of energy and intensify our conser-
vation efforts. All consuming countries, de-
veloped and developing, must use energy
more efficiently and develop more abundant
supplies. Producers need to prepare their
economies for the day when they will have
exhausted their easily accessible oil reserves.

Individually, the industrialized countries
are accelerating the development of their
own energy sources. The United States is de-
veloping its conventional fuels and also new
sources, including nuclear power, to replace
fossil fuels. We have committed massive re-
sources to research and devoted our best
talents to this effort; we expect it to result
in a substantial increase in U.S. energy pro-
duction. In Europe, major efforts have been
launched along the same lines, with the
North Sea as the most dramatic example
of the potential. The development of alterna-
tive energy sources is vital.

In the near future, the industrial countries
will take the first steps toward welding these
national programs into a coherent cooperative
program. These programs are designed to
promote conservation and to accelerate the
development of alternative energy supplies
through large-scale joint projects and coop-
eration in research and development. We will
demonstrate our commitment to the maxi-
mum development of new energy by agree-
ing not to permit imported oil to be sold in
our internal markets below a common mini-
mum safeguard price.

This effort will bring a better balance to
the world energy market. But as it gathers
support, it will bring important benefits to
developing as well as industrial countries.
The programs that the industrial countries
are undertaking, and those that many de-
veloping countries have within their poten-
tial to undertake, can lead to additional and
more secure supplies of energy, which can

be a spur to their prosperity and develop-
ment. All nations will have access to a larger
pool of energy resources, and there will be
less competition for oil. The efforts of de-
veloping countries to increase their own pro-
duction of energy, if supported, can be the
single most important step they take to
secure their development for future genera-
tions.

At the seventh special session of the Gen-
eral Assembly, the United States proposed
an International Energy Institute. Through
such an organization, the developed coun-
tries and OPEC countries [Organization of
Petroleum Exporting Countries] can assist
poorer developing nations to utilize energy
more efficiently, increase their own produc-
tion, and improve allocation and distribution
of existing resources. It could identify cur-
rent or new energy technologies most rele-
vant to their special needs. The institute can
help oil-producing countries to improve the
use of their own energy.

Using the most advanced techniques of
analysis, the institute could help assess all
countries' energy resources and require-
ments. Staffed by experts drawn from gov-
ernment, industry, and academic life in both
industrialized and developing countries, it
could provide training for local and regional
technicians or specialists in energy problems.
It could become a central point of contact
where policymakers and experts could ex-
change ideas on plans and programs.

We see the institute as a first bridge be-
tween the massive effort the industrialized
countries have now launched to develop al-
ternative sources of energy and the effort
which the developing countries must now
undertake.

In addition, the United States has sug-
gested a number of other means by which
the talents and experience of the developed
nations, collectively and individually, can as-
sist developing states to find and exploit new
energy sources and conserve their national
patrimony. We will advance these proposals
in the Energy Commission. We anticipate a
full exchange of views on their scope and
substance.

Oil producers and nations with the tech-

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nology to help develop oil resources share an interest in cooperation on conservation and exploration. But this cooperation will be easier to forge in a stable energy market with a more appropriate structure of energy prices.

—Third, the United States seeks a greater participation and contribution of the oil-producing countries in the international economy. With the extraordinary transfer of wealth that has taken place, it is in the common interest that the oil-producing nations be constructive members, not challengers,

of the world economic system, that investment and the latest technology be made available to them on a reimbursable basis for their development programs, and that the flow of goods and services be enhanced between producing and consuming countries.

We believe that these three issues—a better understanding of the effects of oil price increases on the world economy; cooperation on conservation and new production; and the orderly integration of OPEC economies into the global economy—are priority tasks for the energy forum.

## Food Policy

Even before the energy crisis, the United States intended a major initiative on food. The problem was reaching serious proportions in 1972-74 because of droughts in many parts of the world, devaluation of the dollar (which stimulated demand for US grain), the heavy Soviet purchases, and other factors. In his UNGA speech on September 24, 1973 (#2), HK proposed a UN food conference to address the subject:

### 3. A world community must assure that all its people are fed.

The growing threat to the world's food supply deserves the urgent attention of this Assembly. Since 1969, global consumption of cereals has risen more rapidly than production; stocks are at the lowest levels in years. We now face the prospect that—even with bumper crops—the world may not rebuild its seriously depleted reserves in this decade.

No one country can cope with this problem. The United States therefore proposes:

- That a World Food Conference be organized under United Nations auspices in 1974 to discuss ways to maintain adequate food supplies, and to harness the efforts of all nations to meet the hunger and malnutrition resulting from natural disasters.

- That nations in a position to do so offer technical assistance in the conservation of food. The United States is ready to join with others in providing such assistance.

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After the energy crisis erupted, HK began to treat food policy as a diplomatic counter to OPEC's oil policy. Specifically, we would set an example of cooperative North-South relations in food policy as a positive platform from which to seek similarly cooperative relations on other commodity issues such as energy.

HK sketched the outline of a new US food program in his address on April 15, 1974 to the Sixth Special Session of the UNGA (#13):

## Crisis in Food Production

Third, the global economy must achieve a balance between food production and population growth and must restore the capacity to meet food emergencies. A condition in which 1 billion people suffer from malnutrition is consistent with no concept of justice.

Since 1969, global production of cereals has not kept pace with world demand. As a result, current reserves are at their lowest level in 20 years. A significant crop failure today is likely to produce a major disaster. A protracted imbalance in food and population growth will guarantee massive starvation—a moral catastrophe the world community cannot tolerate.

No nation can deal with this problem alone. The developed nations must commit themselves to significant assistance for food and population programs. The developed nations must reduce the imbalance between population and food which could jeopardize not only their own progress but the stability of the world.

The United States recognizes the responsibility of leadership it bears by virtue of its extraordinary agricultural productivity. We strongly support a global cooperative effort to increase food production. This is why we proposed a World Food Conference at last year's session of the General Assembly.

Looking toward that conference, we have removed all domestic restrictions on production. Our farmers have vastly increased the acreage under cultivation and gathered record harvests in 1973. 1974 promises to be even better. If all nations make a similar effort, we believe the recent rise in food prices will abate this year, as it has in recent weeks.

The United States is determined to take additional steps. Specifically:

- We are prepared to join with other governments in a major worldwide effort to re-

build food reserves. A central objective of the World Food Conference must be to restore the world's capacity to deal with famine.

- We shall assign priority in our aid program to help developing nations substantially raise their agricultural production. We hope to increase our assistance to such programs from $258 million to $675 million this year.

- We shall make a major effort to increase the quantity of food aid over the level we provided last year.

For countries living near the margin of starvation, even a small reduction in yields can produce intolerable consequences. Thus, the shortage of fertilizer and the steep rise in its price is a problem of particular urgency—above all for countries dependent on the new high-yield varieties of grain. The first critical step is for all nations to utilize fully existing capabilities. The United States is now operating its fertilizer industry at near capacity. The United States is ready to provide assistance to other nations in improving the operation of plants and to make more effective use of fertilizers.

But this will not be enough. Existing worldwide capacity is clearly inadequate. The United States would be prepared to offer its technological skills to developing a new fertilizer industry in developing countries and especially in oil-producing countries, using the raw materials and capital they uniquely possess.

We also urge the establishment of an international fertilizer institute as part of a larger effort to focus international action on two specific areas of research: improving the effectiveness of chemical fertilizers, especially in tropical agriculture, and new methods to produce fertilizers from non-petroleum resources. The United States will contribute facilities, technology, and expertise to such an undertaking.

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HK regarded Latin America as a test case for US cooperation with the Third World. Food policy was relevant here, as a fruitful area of US-Latin American cooperation, as HK indicated in his address on April 20, 1974 to the OAS General Assembly hold in Atlanta (#14):

The Western Hemisphere has a special role to play in overcoming the *world food shortage*. This continent, even as it is scarred by malnutrition and hunger, has a vast agricultural potential. President Nixon is asking the Congress to raise our assistance to food production programs in the Americas by 50 percent. We have, as well, lifted our own domestic production restrictions.

The shortage of fertilizer and the steep rise in its price are a problem of particular urgency. The United States will give high priority to linking our technological skills with the raw material and capital of oil-producing countries to encourage the development of new fertilizer capacity.

In a collective effort, I propose that we cooperate in a program to increase food production in this hemisphere substantially by

the end of this decade. This program should encompass research, the application of science and technology, and the intensified application of foreign and domestic resources:

- As an initial step, we should ask the Inter-American Economic and Social Council to help focus our efforts to increase production and productivity. The Working Group on Science and the Transfer of Technology should explore new ways to increase agricultural productivity, especially in the continent's vast tropical zones.

- A comprehensive hemispheric agricultural survey would be an important contribution to the success of the World Food Conference.

- Food processing is another high-priority field for cooperation and innovation.

At the UN General Assembly on September 23, 1974 (#17), HK foreshadowed the major new initiative that the US planned to make at the World Food Conference in Rome in November. The comments about US food policy were juxtaposed with-- and contrasted with--OPEC's policy on oil:

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Unlike food prices, the high cost of oil is not the result of economic factors—of an actual shortage of capacity or of the free play of supply and demand. Rather it is caused by deliberate decisions to restrict production and maintain an artificial price level. We recognize that the producers should have a fair share; the fact remains that the present price level even threatens the economic well-being of producers. Ultimately they depend upon the vitality of the world economy for the security of their markets and their investments. And it cannot be in the interest of any nation to magnify the despair of the least developed, who are uniquely vulnerable to exorbitant prices and who have no recourse but to pay.

What has gone up by political decision can be reduced by political decision.

Last week President Ford called upon the oil producers to join with consumers in defining a strategy which will meet the world's long-term need for both energy and food at reasonable prices. He set forth the principles which should guide such a policy. And he announced to this Assembly America's determination to meet our responsibilities to help alleviate another grim reality: world hunger.

At a time of universal concern for justice and in an age of advanced technology, it is intolerable that millions are starving and hundreds of millions remain undernourished.

The magnitude of the long-term problem is clear. At present rates of population growth, world food production must double by the end of this century to maintain even the present inadequate dietary level. And an adequate diet for all would require that we triple world production. If we are true to our principles, we have an obligation to strive for an

adequate supply of food to every man, woman, and child in the world. This is a technical possibility, a political necessity, and a moral imperative.

The United States is prepared to join with all nations at the World Food Conference in Rome to launch the truly massive effort which is required. We will present a number of specific proposals:

- To help developing nations. They have the lowest yields and the largest amounts of unused land and water; their potential in food production must be made to match their growing need.

- To increase substantially global fertilizer production. We must end once and for all the world's chronic fertilizer shortage.

- To expand international, regional, and national research programs. Scientific and technical resources must be mobilized now to meet the demands of the year 2000 and beyond.

- To rebuild the world's food reserves. Our capacity for dealing with famine must be freed from the vagaries of weather.

- To provide a substantial level of concessionary food aid. The United States will in the coming year increase the value of our own food aid shipments to countries in need. We make this commitment, despite great pressures on our economy and at a time when we are seeking to cut our own government budget, because we realize the dimensions of the tragedy with which we are faced. All of us here have a common obligation to prevent the poorest nations from being overwhelmed and enable them to build the social, economic, and political base for self-sufficiency.

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To the Al Smith Memorial Dinner in New York on October 15, 1974 (# 18), HK eloquently cited the food problem as one of the new global issues that cried out for international cooperation. He again foreshadowed the initiative that we would shortly be making at the World Food Conference:

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The World Food Conference, held in Rome on November 5, 1974, is the subject of a separate book. HK's speech to the conference (#20) highlighted the general theme of interdependence. Again, there was also the explicit contrast with the OPEC policy on oil: the United States was committed to the principle that nations should wield their special advantages as a kind of global trust in an interdependent world, rather than as a weapon. Global cooperation in food should be a model for endeavors in every other field such as energy, inflation, population, protection of the environment:

We meet to address man's most fundamental need. The threat of famine, the fact of hunger, have haunted men and nations throughout history. Our presence here is recognition that this eternal problem has now taken on unprecedented scale and urgency and that it can only be dealt with by concerted worldwide action.

Our challenge goes far deeper than one area of human endeavor or one international conference. We are faced not just with the problem of food but with the accelerating momentum of our interdependence. The world is midway between the end of the Second World War and the beginning of the 21st century. We are stranded between old conceptions of political conduct and a wholly new environment, between the inadequacy of the nation-state and the emerging imperative of global community.

In the past 30 years the world came to assume that a stable economic system and spreading prosperity would continue indefinitely. New nations launched themselves confidently on the path of economic and social development; technical innovation and industrial expansion promised steady improvement in the standard of living of all nations; surpluses of fuel, food, and raw materials were considered a burden rather than a blessing. While poverty and misery still afflicted many parts of the globe, over the long run there was universal hope; the period was fairly characterized as a "revolu tion of rising expectations."

That time has ended. Now there are fundamental questions about our capacity to meet even our most basic needs. In 1972, partly due to bad weather around the globe, world grain production declined for the first time in two decades. We were made omi-

nously conscious of the thin edge between hope and hunger, and of the world's dependence on the surplus production of a few nations. In 1973, first a political embargo and then abruptly raised prices for oil curbed production in the world's factories and farms and sharply accelerated a global inflation that was already at the margin of governments' ability to control. In 1974, the international monetary and trading system continues under mounting stress, not yet able to absorb the accumulated weight of repeated shocks, its institutions still struggling to respond. The same interdependence that brought common advance now threatens us with common decline.

We must act now and we must act together to regain control over our shared destiny. Catastrophe when it cannot be foreseen can be blamed on a failure of vision or on forces beyond our control. But the current trend is obvious, and the remedy is within our power. If we do not act boldly, disaster will result from a failure of will; moral culpability will be inherent in our foreknowledge.

The political challenge is straightforward: Will the nations of the world cooperate to confront a crisis which is both self-evident and global in nature? Or will each nation or region or bloc see its special advantage as a weapon instead of as a contribution? Will we pool our strengths and progress together or test our strengths and sink together?

President Ford has instructed me to declare on behalf of the United States: 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.

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That is why we proposed this conference. That is why a Secretary of State is giving this address. The United States will make a major effort to match its capacity to the magnitude of the challenge. We are convinced that the collective response will have an important influence on the nature of the world that our children inherit.

As we move toward the next century the nations assembled here must begin to fashion a global conception. For we are irreversibly linked to each other—by interdependent economies and human aspirations, by instant communications and nuclear peril. The contemporary agenda of energy, food, and inflation exceeds the capacity of any single government, or even of a few governments together, to resolve.

All nations—East and West, North and South—are linked to a single economic system. Preoccupation with narrow advantage is foredoomed. It is bound to lead to sterile confrontations, undermining the international cooperation upon which achievement of national objectives depends. The poorest and weakest nations will suffer most. Discontent and instabilities will be magnified in all countries. New dangers will be posed to recent progress in reducing international tensions.

But this need not be our future. There is great opportunity as well as grave danger in the present crisis. Recognition of our condition can disenthrall us from outdated conceptions, from institutional inertia, from sterile rivalries. If we comprehend our reality and act upon it, we can usher in a period of unprecedented advance with consequences far transcending the issues before this conference. We will have built an international system worthy of the capacities and aspirations of mankind.

## The Food Challenge

We must begin here with the challenge of food. No social system, ideology, or principle of justice can tolerate a world in which the spiritual and physical potential of hundreds of millions is stunted from elemental hunger or inadequate nutrition. National pride or regional suspicions lose any moral and practical justification if they prevent us from overcoming this scourge.

A generation ago many farmers were self-sufficient; today fuel, fertilizer, capital, and technology are essential for their economic

survival. A generation ago many nations were self-sufficient; today a few food exporters provide the margin between life and death for many millions.

Thus food has become a central element of the international economy. A world of energy shortages, rampant inflation, and a weakening trade and monetary system will be a world of food shortages as well. And food shortages in turn sabotage growth and accelerate inflation.

* * *

Nothing more overwhelms the human spirit, or mocks our values and our dreams, than the desperate struggle for sustenance. No tragedy is more wounding than the look of despair in the eyes of a starving child.

Once famine was considered part of the normal cycle of man's existence, a local or at worst a national tragedy. Now our consciousness is global. Our achievements, our expectations, and our moral convictions have made this issue into a universal political concern.

The profound promise of our era is that for the first time we may have the technical capacity to free mankind from the scourge of hunger. Therefore, today we must proclaim a bold objective—that within a decade no child will go to bed hungry, that no family will fear for its next day's bread, and that no human being's future and capacities will be stunted by malnutrition.

Our responsibility is clear. Let the nations gathered here resolve to confront the challenge, not each other. Let us agree that the scale and severity of the task require a collaborative effort unprecedented in history. And let us make global cooperation in food a model for our response to other challenges of an interdependent world: energy, inflation, population, protection of the environment.

William Faulkner expressed the confidence that "man will not merely endure: he will prevail." We live today in a world so complex that even only to endure, man must prevail. Global community is no longer a sentimental ideal, but a practical necessity. National purposes, international realities, and human needs all summon man to a new test of his capacity and his morality.

We cannot turn back or turn away.

"Human reason," Thomas Mann wrote, "needs only to will more strongly than fate and it is fate."

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In a speech before the Kansas City International Relations Council on May 13, 1975 (#28), HK spoke on the subject of strengthening the world economic structure. Food was a principal topic. HK explained what had happened at, and since, the World Food Conference.

## Action Required on the Food Problem

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 agreement on a comprehensive program in basic areas: Expanding the food production of the major producers; accelerating production in the developing countries; improving the means of food distribution and financing; enhancing the nutritional quality of food production; and developing a system of reserves to insure against food emergencies. 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 requirements for food are growing dramatically, not easing. The current gap between what developing countries pro-

duce 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.

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

(HK went on to discuss in some further detail the problem of establishing national food reserves.)

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HK raised the subject of food at the OECD Ministerial in Paris on May 28, 1975 (# 32). He urged serious consideration of the many proposals which the United States had put on the table:

## 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 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 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.

To these ends, the United States supports two new international mechanisms:

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.

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At the Seventh Special Session of the UNGA on September 1, 1975, HK's speech (# 39), read by Pat Moynihan, offered initiatives in several broad areas in the context of a clearly articulated philosophy of North-South relations. HK spoke of the need for "food security," inter alia, and repeated that global cooperation in this area could be a model for cooperation in other areas:

## Food Security

The most vital commodity in the world is food. The United States is its largest producer and exporter. We recognize our responsibility. We have also sought to make international collaboration in food a model for realistic and cooperative approaches to other international economic issues.

The U.S. policy is now one of maximum production. At home, we want a thriving farm economy and moderate prices for consumers. Internationally, we wish cooperative relations with nations that purchase from us, an open and growing market, and abundant supplies to meet the needs of the hungry through both good times and bad.

For hundreds of millions of people, food security is the single most critical need in their lives; for many it is a question of life itself. But food security means more than emergency relief to deal with crop failures, natural disasters, and pockets of famine. It means reasonable stability in the availability of food in commercial markets so that harvest failures in some parts of the world will not make food impossibly expensive elsewhere. We have seen with dramatic frequency in recent years how the international food market, strained to capacity, can shake the international economy. Its fluctuations have accelerated inflation, devastated development plans, and wreaked havoc with human lives. Yet in good times, the world community has not summoned the will to take obvious corrective steps to stabilize the market structure.

The United States believes that a global approach to food security, which contains elements that can apply to other commodities, should follow these basic principles:

- The problem must be approached globally, comprehensively, and cooperatively, by consultation and negotiation among all significant producers and consumers;

- Producers should recognize the global interest in stability of supply, and consumers should recognize the interest of producers in stability of markets and earnings;

- Special consideration should be given to the needs of developing countries; and

- Where volatile demand is combined with limited ability to make short-term increases in production, buffer stocks may be the best approach to achieving greater security for both consumers and producers.

At the World Food Conference last November, which was convened at our initiative, the United States proposed a comprehensive international cooperative approach to providing food security. We proposed an international system of nationally held grain reserves, to meet emergencies and improve the market. The United States has since then offered specific proposals and begun negotiations. But the international effort lagged when improved harvests seemed to diminish the immediate danger of worldwide shortage.

My government today declares that it is time to create this reserve system. If we do not, future crises are inevitable. Specifically, we propose:

- To meet virtually all potential shortfalls in food grains production, total world reserves must reach at least 30 million tons of wheat and rice. We should consider whether a similar reserve is needed in coarse grains.

- Responsibility for holding reserves should be allocated fairly, taking into account wealth, production, and trade. The United States is prepared to hold a major share.

- Acquisition and release of reserves should be governed by quantitative standards such as anticipated surpluses and shortfalls in production.

- Full participants in the system should receive assured access to supplies. Among major producers, full participation should require complete exchange of information and forecasts.

- Special assistance should be extended to developing countries that participate, to enable them to meet their obligation to hold a portion of global reserves.

The United States is ready to negotiate the creation of such a system. Let us move ahead rapidly.

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Another, more particular initiative on the subject of food was the US proposal for development of the Sahel, announced in HK's speech in Dakar, Senegal, on May 1, 1976 (# 63).

No plans for the future can be secure if they are carried out under the constant threat of economic crisis or natural disaster. Senegal, a nation of the Sahel, knows this as well as any nation. The tragic cycle of recurrent drought and famine which afflicts this area has dramatized to the world that all our efforts at economic progress depend upon our success in master-ing the forces of nature and harnessing them to the service of mankind.

Senegal, along with other countries of the Sahel, has been deeply affected by the deteriorating ecological condition of this region. The recurrent drought of the past few years has made clear that the desert is encroaching on a large scale and that food production capacity in western Africa is seriously threatened.

If present trends continue, in 10 years the Sahel will need to import 1 million tons of grain in a normal year, an amount equal to the largest imports at the height of the drought. In response to this crisis the United States has, since the late 1960's, more than quadrupled our aid to the Sahel nations. And we are gratified that we have been able to provide emergency food assistance which has done so much to save human life.

But traditional aid levels and methods will not be enough. Nor can any one country or any single donor provide the resources necessary to meet the critical long-term needs of the Sahel. What is now needed is a comprehensive international program that, rather than ease the effects of the drought, will help roll back the desert—instead of relief measures, will develop additional water resources, increase crop acreage, and build food storage facilities in order to insure that hard-won progress in economic development will not continue to be wiped out by recurrent natural disaster.

To meet this challenge, the community of concerned nations should organize an international consortium to undertake a systematic and comprehensive attack on the Sahel's development problems to eliminate the problem of the drought rather than ease it. In the long term this could cost far less than endless relief efforts. This will require mobilizing foreign and local investment on a major scale over the next decade, especially through multilateral institutions.

To this end, the United States is prepared to begin discussions with concerned nations aimed at the creation of an international development investment program to be integrated and dedicated to the goal of eventual self-sufficiency for the Sahel. This will mean:

- Initiating the development of major river basins—the Senegal, Gambia, Niger, and Volta, as well as the Lake Chad Basin—to reduce dependence on annual rainfall and promote food production;

- Developing broader and more comprehensive programs for utilization and conservation of ground water;

- Undertaking a major broad-scale effort to improve the use of dryland areas for crops and livestock, particularly until comprehensive water resources development can have an effect;

- Developing distribution systems commensurate with improvements in agriculture;

- Undertaking major reforestation programs;

- Developing basic transportation and communications networks; and

- Mounting a concerted, massive attack on the problems of disease and inadequately trained local manpower.

Such a program would deal with the challenge of development in a methodical and comprehensive strategy. Each element would be planned to contribute to the primary goal: self-sufficiency and self-sustaining growth for the Sahel. Thus, its organization must:

- Provide mechanisms for donors and Africans to set agreed program priorities and select the appropriate technologies they will require;

- Allow African states to participate either on a national basis or through strengthened regional institutions;

- Provide the means to concert the efforts of donors, even though many of their contributions may in fact be made bilaterally; and

- Utilize the planning, organizing, and coordinative capacity of existing multilateral organizations.

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from poor and rich alike cannot be sustained.

And because economic security is a global problem, it is a global challenge:

- The industrial nations must work together more effectively to restore and maintain their noninflationary expansion;

- Nations which supply vital products must avoid actions which disrupt that expansion; and

- The international community must undertake a new approach to reduce drastic fluctuations in the export earnings of the developing countries.

Since the economic health of the industrial countries is central to the health of the global economy, their efforts to avoid the extremes of recession and inflation become an international, as well as a national, responsibility.

In a new departure this past year, the leaders of the United States and its major trading partners have begun closer coordination of their national economic policies. A shared sense of urgency, and the exchange of information about trends and intentions, have already influenced important policy decisions. President Ford intends to continue and intensify consultations of this kind. The successful recovery of the industrial economies will be the engine of international stability and growth.

Global economic security depends, secondly, on the actions of suppliers of vital products.

Thus the United States has believed that the future of the world economy requires discussions on energy and other key issues among oil consuming and producing nations. The Government of France is inviting industrialized, oil-producing, and developing nations to relaunch a dialogue this fall on the problems of energy, development, raw materials, and related financial issues. The United States has supported this proposal and worked hard to establish the basis for successful meetings.

But this dialogue is based on an approach of negotiation and consensus, not the exercise of brute economic power to gain unilateral advantage. The enormous, arbitrary increases in the price of oil of 1973 and 1974

have already exacerbated both inflation and recession worldwide. They have shattered the economic planning and progress of many countries. Another increase would slow down or reverse the recovery and the development of nearly every nation represented in this Assembly. It would erode both the will and the capacity in the industrial world for assistance to developing countries. It would, in short, strike a serious blow at the hopes of hundreds of millions around the world.

The forthcoming dialogue among consumers and producers is a test. For its part, the United States is prepared for cooperation. We will work to make it succeed, in our own self-interest and in the interest of all nations. We hope to be met in that same spirit.

The third basic factor in economic security is the stability of export earnings. The development programs—indeed, the basic survival—of many countries rest heavily on earnings from exports of primary products which are highly vulnerable to fluctuations in worldwide demand. Countries which depend on one product can find their revenues reduced drastically if its price drops or if exports fall precipitously. Most have insufficient reserves to cushion against sharp declines in earnings, and they cannot quickly increase the exports of other products. Facing such economic problems, most cannot borrow to offset the loss or can only do so at extremely high interest rates. In such situations countries are frequently forced to cut back on the imports on which their growth and survival depend. Thus the unpredictability of export earnings can make a mockery of development planning.

The question of stabilization of income from primary products has become central in the dialogue on international economic concerns. Price stabilization is not generally a promising approach. For many commodities it would be difficult to achieve without severe restrictions on production or exports, extremely expensive buffer stocks, or price levels which could stimulate substitutes and thereby work to the long-range disadvantage of producers. Even the most ambitious agenda for addressing individual commodi-

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ties would not result in stabilization arrangements for all of them in the near term. And focusing exclusively on stabilizing commodity prices would not provide sufficient protection to the many developing countries whose earnings also depend on the exports of manufactured goods.

The U.S. Government has recently completed a review of these issues. We have concluded that, because of the wide diversity among countries, commodities, and markets, a new, much more comprehensive approach is required—one which will be helpful to exporters of all commodities and manufactured goods as well.

Let me set forth our proposal. The United States proposes creation in the International Monetary Fund (IMF) of a new development security facility to stabilize overall export earnings.

- The facility would give loans to sustain development programs in the face of export fluctuations; up to $2.5 billion, and possibly more, in a single year and a potential total of $10 billion in outstanding loans.

- Assistance would be available to all developing countries which need to finance shortfalls in export earnings, unless the shortfalls are caused by their own acts of policy.

- The poorest countries would be permitted to convert their loans into grants under prescribed conditions. These grants would be financed by the proceeds of sales of IMF gold channeled through the proposed $2 billion Trust Fund now under negotiation.

- Eligible countries could draw most, or under certain conditions all, of their IMF quotas in addition to their normal drawing rights. Much of that could be drawn in a single year, if necessary; part automatically,

part subject to balance-of-payments conditions, and part reserved for cases of particularly violent swings in commodity earnings.

- Shortfalls would be calculated according to a formula geared to future growth as well as current and past exports. In this way the facility helps countries protect their development plans.

- This facility would replace the IMF's compensatory finance facility; it would not be available for industrial countries.

The United States will present its detailed proposals to the Executive Directors of the International Monetary Fund this month.

This development security facility would provide unprecedented protection against disruptions caused by reductions in earnings —both for countries whose exports consist of a few commodities and for those with diversified and manufactured exports, whose earnings also fluctuate with business cycles. In the great majority of countries, this new facility will cover nearly all the earnings shortfall.

This new source of funds also reinforces our more traditional types of assistance; without the stabilization of earnings, the benefits of concessional aid for developing countries are vitiated. For industrialized countries, it means a more steady export market. For developing countries, it helps assure that development can be pursued without disruption and makes them more desirable prospects in international capital markets. For consumers and producers, rich and poor alike, it buttresses economic security.

Thus the success of our efforts in this area will demonstrate that our interdependence can strengthen the foundations of prosperity for all while promoting progress in the developing countries.

Trade in commodities was a principal concern of developing countries, and various proposals were being discussed: buffer stocks, price indexing, commodity agreements, etc. The United States generally shied away from arrangements which artificially stabilized prices by interfering with market forces. Under HK's prodding, the US government came up with alternative proposals which were consistent with market principles yet were responsive to the needs of the developing countries.

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In his speech to the Sixth Special Session of the UNGA on April 15, 1974 (#13), HK outlined the essentials of the American approach to the commodity problem. Cartelization was a mistake; the only reasonable course was through consumer-producer cooperation:

## Avoiding Imbalances in Raw Materials

Second, a healthy global economy requires that both consumers and producers escape from the cycle of raw material surplus and shortage which threatens all our economies.

The principles which apply to energy apply as well to the general problem of raw materials. It is tempting to think of cartels of raw material producers to negotiate for higher prices. But such a course could have serious consequences for all countries. Large price increases coupled with production restrictions involve potential disaster: global inflation followed by global recession from which no nation could escape.

Moreover, resources are spread unevenly across the globe. Some of the poorest nations have few natural resources to export, and some of the richest nations are major commodity producers.

Commodity producers will discover that they are by no means insulated from the consequences of restrictions on supply or the escalation of prices. A recession in the industrial countries sharply reduces demand. Uneconomical prices for raw materials accelerate the transition to alternatives. And as they pursue industrialization, raw material producers will ultimately pay for exorbitant commodity prices by the increased costs of the goods they must import.

Thus the optimum price is one that can be maintained over the longest period at the level that assures the highest real income. Only through cooperation between consumers and producers can such a price be determined. Such a cooperative effort must include urgent international consideration of restrictions on incentives for the trade in commodities. This issue—dealing with access to supply as well as access to markets—must receive high priority in GATT [General Agreement on Tariffs and Trade] as we seek to revise and modernize the rules and conditions of international trade.

In the long term, our hopes for world prosperity will depend on our ability to discern the long-range patterns of supply and demand and to forecast future imbalances so as to avert dangerous cycles of surplus and shortage.

For the first time in history, it is technically within our grasp to relate the resources of this planet to man's needs. The United States therefore urges that an international group of experts, working closely with the United Nations Division on Resources, be asked to undertake immediately a comprehensive survey of the earth's nonrenewable and renewable resources. This should include the development of a global early warning system to foreshadow impending surpluses and scarcities.

HK spoke at greater length on the American approach to the commodity issue in a speech in Kansas City on May 13, 1975 (#28), before the Kansas City International Relations Council. He rejected such proposals as indexing commodity prices to the level of world inflation. But he suggested such measures as reforms in GATT, case-by-case discussions of arrangements for individual commodities, and promotion of investment:

196

## U.S. Approach to Commodity Issues

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 material 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 underway 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 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 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 material question with economic realism, political imagination, and understanding for the concerns of the developing world.

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As he promised, HK took up the commodities question in his address to the OECD Ministerial in Paris on May 28, 1975 (#32). Again he stated US opposition to cartelization, but the United States was willing to discuss case-by-case arrangements and new ideas to promote investment:

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 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 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.

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HK spoke on the subject of commodities, again in general terms, in the speech to the Seventh Special Session of the UNGA on September 1, 1975 (#39). Cooperation was required, if only because some of the main commodity producers were the industrialized countries:

## Commodity Trade and Production

Exports of primary products—raw materials and other commodities—are crucial to the incomes of developing countries. These earnings can lift living standards above bare subsistence, generate profits to support the first steps of industrialization, and provide tax revenues for education, health, and other social programs for development. The history of the United States—and many other countries—confirms the importance of commodities.

But this path can be precarious in an uncertain global environment. Those developing countries which are not oil exporters rely on primary commodities for nearly two-thirds of their export earnings. Yet their sales of raw materials and agricultural products have not grown as fast as those of industrial countries. Agricultural commodities, particularly, are vulnerable to the whims of weather and swings of worldwide demand. The market in minerals is especially sensitive to the pendulum of boom-and-bust in the industrial countries. The result is a cycle of scarcity and glut, of underinvestment and overcapacity.

Developing countries are hit hard by commodity cycles also as consumers; higher

prices for energy imports, swings in the price and supply of food, and greater costs for other essential raw materials have been devastating blows, soaking up aid funds and the earnings by which they hoped to finance imports. All this can make a mockery of development plans.

But the problems of commodities are not the problems only of developing countries. The industrialized countries are in fact the largest exporters of food and most minerals. Gyrating prices complicate economic decisions in industrial countries. And consumers in industrial countries have painfully learned that high commodity prices leave their inflationary impact long after the commodity market has turned around.

Therefore both industrial and developing countries would benefit from more stable conditions of trade and an expansion of productive capacity in commodities.

Many solutions have been put forward to benefit producers of particular products: cartelization, price indexing, commodity agreements, and other methods. But reality demonstrates the interdependence of all our economies and therefore the necessity for approaches that serve global rather than narrow interests.

The centerpiece of the US approach to commodities was Chuck Robinson's idea of an International Resources Bank to promote investment in raw materials in developing countries. The idea was unveiled in HK's speech to the UNCTAD conference in Nairobi on May 6, 1976 (#64) as part of a comprehensive approach to commodities. The speech also promised to consider the idea of buffer stocks in some cases, as well as to beef up the IMF compensatory financing facility that was created to deal with the problem of swings in the terms of trade:

199

A Comprehensive Approach to Commodities

Commodity exports are critical for devel-
opment. The non-oil developing countries
rely on primary products for nearly two-
thirds of their export earnings. Yet produc-
tion and export of these resources are vul-
nerable to the whims of weather, the swings
of worldwide demand, and new technology.
Cycles of scarcity and glut, of underinvest-
ment and overcapacity, disrupt economic
conditions in both the developing and the
industrial world.

It has become clear in recent years that a piecemeal approach to these issues will not suffice. The UNCTAD Secretariat has made an important contribution to meeting these problems in its integrated commodities program. While the United States cannot accept all of its elements, there are many parts which we are prepared to consider.

At this conference, the United States proposes its own comprehensive approach to commodity issues. It reflects many of the objectives contained in the integrated program and our desire for constructive action on all aspects of the challenge. It contains the following elements:

- Insuring sufficient financing for re-source development and for equitable shar-ing in the benefits by the host nation;

-Improving the conditions of trade and
investment in individual commodities and
moderating excessive price fluctuations;

-Stabilizing the overall export earnings
of developing countries; and

-Improving access to markets for proc-
essed products of developing countries while
assuring consumers reliability of supply.

N]

200

Let me discuss each of these elements in
turn.

## Adequate Investment

Most of the world's raw material produc-
tion in fact takes place in the industrial
countries. But if development is to take
hold, a special effort must be made to ex-
pand the production and exports of primary
products of developing countries. Such a
program must overcome the following
problems.

First, we must deal realistically with the
political and economic problems which are
diverting investments from developing to
developed countries. For, paradoxically, re-
source development is often discouraged by
the very countries which are most in need
of it. Nationalization and forced change in
the terms of concessions in some develop-
ing countries have clouded the general cli-
mate for resource investment in the develop-
ing world. Social and political uncertainties
have further complicated investment pros-
pects. As a result, commercially viable proj-
ects have been postponed, canceled, or re-
located; and capital, management, and tech-
nology have been diverted to production of
higher cost raw materials in the industrial-
ized world.

Second, in the next decade alone the total
requirements for global investment in re-
sources will be massive. Individual projects
will require unprecedented sums of capital
and complex financial arrangements. The
time required between the beginning of a
project and its completion is increasing. All
these factors compound the political un-
certainties and further inhibit rational
investment.

Third, there is no one institution that can
work comprehensively to facilitate resource
development, particularly in energy and min-
erals, or to promote equitable sharing of its
benefits.

If present trends continue, serious mis-
allocations of capital, management, and tech-
nology are inevitable. The costs of raw ma-
terial and agricultural production will esca-
late. Many potential producers will be un-

able to attract adequate capital. All coun-
tries will pay the price in accelerated infla-
tion and retarded growth—with the poorest
countries suffering the most.

To overcome these problems the United
States proposes the establishment of an In-
ternational Resources Bank (IRB). This
new institution would promote more ra-
tional, systematic, and equitable develop-
ment of resources in developing nations. It
would facilitate technological development
and management training in the develop-
ing countries. It would help insure supplies
of raw materials to sustain the expansion of
the global economy and would help moder-
ate commodity price fluctuations.

The International Resources Bank would mobilize capital for sound resource development projects by assisting individual resource projects to secure direct financing and issuing bonds which could be secured by a specific commodity. Alternatively, these bonds could be retired through delivery of a specific commodity. "Commodity bonds" of this type could greatly improve conditions of supply and market access and help developing countries to stabilize export earnings.

To enhance confidence for both host gov-
ernments and investors the International
Resources Bank would begin operations with
a capital fund of $1 billion. It would partici-
pate with foreign investors and the host
government in project agreements specify-
ing the conditions of the investment on a
basis acceptable to all parties. Such an agree-
ment could include a formula for production
sharing and arrangements by investors to
help develop the managerial, technological,
and marketing capabilities of the host coun-
try. The Bank would support guarantees of
both investor and host nation performance
in accordance with conditions established in
the project agreement.

To insure effective coordination with other
public institutions, the International Re-
sources Bank could be associated with the
World Bank Group, in a form to be worked
out by the participating countries. It could
operate in close collaboration with—and ren-
der even more effective—other institutions

661

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such as the World Bank and its associate, the International Finance Corporation, and the Inter-American Development Bank as well as the U.N. revolving fund for mineral exploration.

The IRB proposal offers many advantages and new concepts:

- Its facilitating role as third party with the host country and the foreign investor will encourage conditions for project development consistent with internationally accepted standards of equity.

- The IRB mechanism provides multilateral guarantees of the performance of both the host nation and the foreign investor in accordance with the project agreement—thereby reducing the noncommercial risks. This cannot fail to promote greater flows of investment capital for resource projects on reasonable terms.

- The proposal contemplates production-sharing arrangements under which the foreign investor is assured of an established percentage of total production with disposition of the balance to be controlled by the host nation. This allows the host nation to share in production from the outset, providing it with the basis for further processing of the raw material should this prove to be economically feasible.

- Commodity bonds would be a fruitful new international instrument for forward purchases of commodities. They could contribute to earnings stabilization. They would also provide added assurance of market access for the host country and supply access for the consumer.

- Finally, through the IRB, modern technology would flow into developing nations. The two key elements required for development—management and technology—are provided by the foreign investor directly in a new form of capital investment. The trilateral agreement could include provision for the progressive acquisition of technology by the host country and thus contribute importantly to the process of technology transfer.

We consider the International Resources Bank to be an innovative and significant response to the basic needs of the developing nations and the international community. It will be a major advance in the sharing of benefits and responsibilities between industrialized and developing nations. It will help insure the essential flow of capital, management, and technology into resource development under conditions acceptable to host governments. And it will enhance the predictability that is essential to attract capital investment. We hope other countries will join us during the coming months to design and establish this global institution.

*Improvement of the Conditions of Trade and Investment in Individual Commodities*

We are all conscious of the problems the world economy has faced recently in this area. Within only two years the tight supply and astronomical prices of many critical materials have been followed by a period of declining prices. Many economies have been severely shaken, and several countries have suffered balance-of-payments crises. Drastic price changes affect the developing countries most severely, playing havoc with foreign exchange earnings and development plans. And because raw material production projects require years to develop and involve high risks, volatile prices tend to lead to erratic patterns of investment.

There are a number of ways to improve commodity markets: long-term contractual arrangements, better exchange of market information, improved distribution, more efficient production methods, and better storage and transport facilities.

We agree with the UNCTAD Secretariat that buffer stocks deserve special attention. For those commodities where buffer stocks are feasible, sharp fluctuations in prices can be moderated by building stocks when markets are weak. And adequate supplies at reasonable prices can be assured through releasing stocks when markets are tight.

The United States believes that buffer stocks can be financed from a combination of sources: direct contribution by the participants, export taxes, commercial borrowing

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guaranteed by the countries participating in
the buffer stock, or through the existing
facilities of international institutions.
Should existing sources prove inadequate,
we would also be prepared to consider the
IRB as a supplemental channel for financ-
ing a particular buffer stock. In these ways,
we are convinced that adequate international
financing for buffer stocks can be assured
within the context of the specific commodity
agreement under which the stock is estab-
lished. Clearly, the United States would not
want a buffer stock in which we had agreed
to participate to fail for want of adequate
financing.

The United States has pursued a con-
structive approach to other aspects of the
commodities problem:

—We have joined with producers and con-
sumers of key commodities to agree on
measures to improve and stabilize markets.

—We have signed commodity agreements
on coffee and tin, and we will participate in
negotiations on sugar. We viewed cocoa as
well suited to a buffer stock arrangement but
were disappointed in the agreement nego-
tiated a few months ago, which we believe
is unlikely to improve the functioning of the
cocoa market. If other parties are interested,
we stand ready to renegotiate this agree-
ment.

—The United States recently participated
in the first meeting of producers and con-
sumers of copper. We look forward to the
establishment of a permanent producer-
consumer group.

—Agricultural raw materials need serious
attention as well. Those that face declining
markets from growing competition from
lower cost producers and synthetics can
benefit from market promotion, research to
improve productivity and marketability, or
diversification into other products. We rec-
ommend that producer-consumer forums
dealing with individual commodities focus on
such possibilities. We urge that the World
Bank and the regional development banks
give high priority to funding projects for
these purposes.

Today the United States proposes these
additional measures:

—First, let us reach agreement on a definite
timetable for the study of specific com-
modity problems of interest to developing
countries. We are prepared to initiate con-
certed consideration in producer-consumer
forums this year of measures to improve the
stability, growth, and efficiency of markets
for all key commodity exports of developing
countries. Particular attention should be
given to the formation of groups for bauxite
and iron ore.

—Second, since many of the poorest coun-
tries are dependent on these products for ex-
port earnings, we urge the World Bank and
regional institutions to sponsor projects to
improve production efficiency and markets
for jute, sisal, and other hard fibers or to
facilitate diversification into other products
in order to reduce excessive reliance on
them.

—Finally, any program of resource devel-
opment must emphasize the two most vital
international resources: food and energy.

Forecasts of good harvests must not lull
us into letting the progress begun at the
World Food Conference slip away. At that
conference, nations agreed to work toward
a system of world grain reserves to improve
food security, to increase support for agri-
cultural research, to develop programs for
nutritional improvement, and to increase
agricultural development in low-income
countries. We urge other countries to join
us to make the concept of world food re-
serves a reality, to increase support for agri-
culture development in poorer nations, and
to provide necessary food aid.

In energy we strongly support the efforts
of oil producers and consumers from both
the industrialized and the developing world
to achieve cooperative solutions at the Con-
ference on International Economic Coopera-
tion. We urge that our proposal for an Inter-
national Energy Institute—which would help
developing countries take advantage of their
domestic energy resources—receive priority
attention in the months ahead.

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## Stabilizing Export Earnings of Developing Countries

At the seventh special session, the United States listed as its first priority the need to insure economic security for the developing world. We continue to believe that the world economic system must provide the developing nations greater security from the worst effects of fluctuating prices, recession, inflation, and other economic shocks which they are helpless to prevent or avoid.

We are gratified at the rapid implementation of our proposals to the special session for the far-reaching expansion of the International Monetary Fund. These innovations make available billions of dollars in new financing to offset steep declines in export earnings.

The most significant step forward has been the Fund's agreement to liberalize its compensatory financing facility. As of now, roughly $800 million from this improved facility has been provided. If this rate continues, more money will have been lent this year from the facility than the entire amount provided over the last 12 years.

Another major advance has been the establishment of an IMF trust fund to help meet the balance-of-payments needs of the poorest countries. While many developing countries have received substantial benefits from the compensatory financing facility, low-income countries whose export revenues depend on one or two commodities often need additional financial help to meet balance-of-payments problems. To assist the poorest countries, the United States has proposed that the trust fund provide concessional financing to poorer countries to offset declines in earnings from an agreed list of particularly significant commodities.

Moreover, the United States would be ready to join others in a review of the adequacy of the trust fund's resources, should they prove inadequate to stabilize earnings and provide general balance-of-payments financing for low-income developing nations. We especially urge those oil-producing nations with strong reserves to contribute to the trust fund's lending capacity.

## Expanding Trade in Resources and Processed Goods

Trade has been an engine of growth for all countries; for many developing countries it is the most critical vehicle of development. The United States has taken a number of initiatives to meet the special needs of developing countries. We have reduced global trade barriers, especially those affecting processed goods; provided preferential access to our market for many exports of developing countries; worked in the multilateral trade negotiations (MTN) in Geneva for reduction of barriers in tropical products; and recognized in our general trade policy the special trade needs of developing countries.

We now have these challenges:

- We must maintain the momentum in reducing world trade barriers.

- We must focus especially on reducing barriers against processed goods, which retard developing countries' efforts to industrialize.

- We need additional international arrangements to assure reliability of supply, for the steady flow of new materials is vital to every country.

To maintain momentum in reducing trade barriers, industrial countries of the OECD [Organization for Economic Cooperation and Development], despite the strains on their economies from higher energy costs and recession, have pledged themselves to avoid restrictive trade measures. The United States intends to join with other developed countries in a renewal of that pledge at the next OECD ministerial meeting in June.

In addition, at the multilateral trade negotiations now taking place in Geneva we will pay special attention to the interests of developing countries, particularly in such areas as processed exports, tropical products, and nontariff barriers.

The institution in January of a generalized system of preferences by the United States, combined with the preference systems of other industrial countries, has opened significant trading opportunities for

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developing nations. Our own preference system already covers more than 2,700 items from nearly 100 countries. The annual trade value of these items is roughly $2.5 billion. We are examining the possibility of including additional products.

The United States will give priority support to the U.N. Development Program (UNDP) financing of a joint GATT-UNCTAD [GATT, General Agreement on Tariffs and Trade] program of technical assistance to developing countries. This will help those countries take full advantage of the preference schemes of industrialized countries by finding the most productive areas for new and increased exports and the best techniques of marketing their products.

In addition, intensive negotiation is now underway in the MTN on tariff treatment of tropical products, including processed goods and manufactures, that are of particular interest to developing countries. The United States intends to implement negotiated tariff reductions in this area as soon as possible once the tropical product package is agreed upon.

In keeping with the Tokyo Declaration, the United States believes that the MTN negotiations on rules concerning nontariff barriers must give greater attention to the needs of developing countries.³ For example, the United States believes that a code to govern the use of countervailing duties against export subsidies should recognize the special conditions facing developing countries. We will urge that the special needs of developing nations be taken into account when new international rules pertaining to offsetting action are being developed.

With respect to new rules on safeguard measures against injury from imports, we will consider special treatment for less developed countries which are minor suppliers or possible new entrants into the U.S. market.

³For 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, see BULLETIN of Oct. 8, 1973, p. 450.

We recognize, too, that developing countries have interests in other reforms of the trading system which are not presently under negotiation. We will respond to these views with an open mind. We are confident that with good will on all sides, constructive agreement can be reached on specific reform issues within the time frame of the multilateral trade negotiations.

The reduction of tariffs against the exports of processed raw materials from developing countries is especially important. Lowering these barriers would provide fresh opportunities to expand and diversify exports, particularly in cases where tariffs now escalate with the degree of processing. To this end, the tariff-reduction proposal which the United States has made in the MTN will not only result in significant tariff cuts but also will reduce tariff escalation. We expect that developing countries will regard this as an incentive to positive cooperation in the current negotiations.

If more open market access is one pillar of an expanding international trading system, greater reliability of supply is another. Without reasonable assurance from producer countries that they will not arbitrarily interfere with exports, importers must turn to other sources. Consumers will then bear the cost of less efficient production; unreliable producers, the cost of lost markets and reduced foreign investment.

There is an urgent need to analyze methods to improve reliability of supply. We urge that work begin promptly in the GATT to determine whether an international code on export controls is feasible. Such a code should define more clearly the circumstances under which countries may legitimately apply export controls. It would reduce the uncertainties for consumers and for exporters, and it would mitigate some of the political damage to relations between countries when restrictions are imposed on exports.

The United States will also continue to seek commitments of reliable supply in the context of specific arrangements negotiated for individual commodities.

This four-point program—a new Interna-

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tional Resources Bank, a case-by-case effort to improve conditions of trade and investment in primary products, stabilization of export earnings, and improved market and supply conditions—recognizes that these issues are linked; yet it permits pragmatic and flexible treatment of specific problems. The approach I have described is a major effort by the United States to deal on a comprehensive basis with commodity issues. It is workable; it is achievable; it is a program which meets the needs of developing and developed nations alike. We urge favorable consideration and rapid collective action.

To promote long-term economic growth in the developing world, access to capital markets was a crucial factor. It was one of the subjects included in HK's address to the Seventh Special Session of the UN General Assembly, September 1, 1975 (#39). Steps had to be taken to improve the availability of development funds through the capital markets:

## Access to Capital Markets

First, access to capital markets: The private capital markets are already a major source of development funds, either directly or through intermediaries. The World Bank and the regional development banks borrow extensively to lend to developing nations. The United States urges the expansion of these programs. We are gratified that advanced countries outside of the Western Hemisphere are joining us shortly in a $6 billion expansion of the Inter-American Development Bank. We will participate in negotiations for replenishment of the Asian Development Bank, and we are seeking congressional authority to join the African Development Fund.

But the developing countries that have been most successful and that no longer require concessional aid, especially in Asia and Latin America, have relied heavily on borrowing in the capital markets. Their future access must be assured.

We must now find new ways to enhance the opportunities of developing countries in the competition for capital. And we need to match in new ways potential sources of capital with the investment needs of developing countries.

Several courses of action offer promise.

First, the United States will support a major expansion of the resources of the World Bank's International Finance Corporation, the investment banker with the broadest experience in supporting private enterprise in developing countries. We propose a large increase in the IFC's capital, from the present $100 million to at least $400 million.

Second, the United States proposes creation of an International Investment Trust to mobilize portfolio capital for investment in local enterprises. The trust would attract new capital by offering investors a unique opportunity: participation in a managed broad selection of investments in developing country firms, public, private, and mixed. The International Finance Corporation would manage it and perhaps provide seed capital, but most of its funds would come from government and private investors. Investors would have their exposure to major losses limited by a $200 million loss reserve provided by governments of industrialized, oil-producing, and developing nations. This institution could be a powerful link between the capital markets and the developing world and could provide billions of dollars of essential resources.

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Third, the United States will contribute actively to the work of the IMF-World Bank Development Committee to find ways to assist developing countries in their direct borrowing in the capital markets. It is encouraging that the Latin American countries are considering a regional financial safety net to underpin their access to capital markets by mutual commitments of financial backing.

Finally, we believe that all industrial countries should systematically review the conditions for developing-country access to their national markets to assure that they offer fair and open opportunity. The United States is prepared to provide technical assistance and expertise to developing countries ready to enter long-term capital markets, and we ask others to join us.

The subject of multinational corporations was touched upon in a number of speeches in 1975. This, of course, was another crucial source of development capital. Speaking to the American Bar Association in Montreal on August 11, 1975 (#37), HK noted that multinational enterprises had made an enormous and essential contribution to world economic growth, and particularly to development. The United States was prepared to help work out an "international consensus on the proper role and responsibilities of these enterprises:"

## Multinational Enterprises

The need for new international regulation touches areas as modern as new technology and as old as war. It also reaches our economic institutions, where human ingenuity has created new means for progress, while bringing new problems of social and legal adjustment.

Multinational enterprises have contributed greatly to economic growth in both their industrialized home countries, where they are most active, and in developing countries where they conduct some of their operations. If these organizations are to continue to foster world economic growth, it is in the common interest that international law, not political contests, govern their future.

Some nations feel that multinational enterprises influence their economies in ways unresponsive to their national priorities.

Others are concerned that these enterprises may evade national taxation and regulation through facilities abroad. And recent disclosures of improper financial relationships between these companies and government officials in several countries raise fresh concerns.

But it remains equally true that multinational enterprises can be powerful engines for good. They can marshal and organize the resources of capital, initiative, research, technology, and markets in ways which vastly increase production and growth. If an international consensus on the proper role and responsibilities of these enterprises could be reached, their vital contribution to the world economy could be further expanded.

A multilateral treaty establishing binding rules for multinational enterprises does not seem possible in the near future.

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However, the United States believes an agreed statement of basic principles is achievable. We are prepared to make a major effort and invite the participation of all interested parties.

We are now actively discussing such guidelines and will support the relevant work of the U.N. Commission on Transnational Corporations. We believe that such guidelines must:

- Accord with existing principles of international law governing the treatment of foreigners and their property rights.

- Call upon multinational corporations to take account of national priorities, act in accordance with local law, and employ fair labor practices.

- Cover all multinationals, state owned as well as private.

- Not discriminate in favor of host-country enterprises except under specifically defined and limited circumstances.

- Set forth not only the obligations of the multinationals but also the host country's responsibilities to the foreign enterprises within their borders.

- Acknowledge the responsibility of governments to apply recognized conflict-of-laws principles in reconciling regulations applied by various host nations.

If multinational institutions become an object of economic warfare, it will be an ill omen for the global economic system. We believe that the continued operation of transnational companies, under accepted guidelines, can be reconciled with the claims of national sovereignty. The capacity of nations to deal with this issue constructively will be a test of whether the search for common solutions or the clash of ideologies will dominate our economic future.

The subject of transnational enterprises came up again in the Seventh Special Session speech of September 1, 1975 (#39). HK urged an agreed statement of "standards of conduct," as well as agreed groundrules on governmental policies toward these enterprises:

### Transnational Enterprises

Access to capital markets and special programs to transfer new technology are but two factors of accelerated growth. There is a third—which may well be one of the most effective engines of development—the transnational enterprise.

Transnational enterprises have been powerful instruments of modernization both in the industrial nations—where they conduct most of their operations—and in the developing countries, where there is often no substitute for their ability to marshal capital, management skills, technology, and initiative. Thus the controversy over their role and conduct is itself an obstacle to economic development.

It is time for the world community to deal with the problems, real and perceived, that have arisen. If the nations assembled here cannot reach consensus on the proper role of these enterprises, the developing countries could lose an invaluable asset. Let us make this issue a test of our capacity to accommodate mutual concerns in practical agreement.

For our part, the United States is prepared to meet the proper concerns of governments in whose territories transnational enterprises operate. We affirm that enterprises must act in full accordance with the sovereignty of host governments and take full account of their public policy. Countries are entitled to regulate the operations of transnational enterprises within their borders. But countries wishing the benefits of these enterprises should foster the conditions that attract and maintain their productive operation.

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The United States therefore believes that the time has come for the international community to articulate standards of conduct for both enterprises and governments. The United Nations Commission on Transnational Corporations and other international bodies have begun such an effort. We must reach agreement on balanced principles. These should apply to transnational enterprises in their relations with governments, and to governments in their relations with enterprises and with other governments. They must be fair principles, for failure to reflect the interests of all parties concerned would exacerbate rather than moderate the frictions which have damaged the environment for international investment. Specifically, the United States believes that:

- Transnational enterprises are obliged to obey local law and refrain from unlawful intervention in the domestic affairs of host countries. Their activities should take account of public policy and national development priorities. They should respect local customs. They should employ qualified local personnel, or qualify local people through training.

- Host governments in turn must treat transnational enterprises equitably, without discrimination among them, and in accordance with international law. Host governments should make explicit their development priorities and the standards which transnational enterprises are expected to meet, and maintain them with reasonable consistency.

- Governments and enterprises must both respect the contractual obligations that they freely undertake. Contracts should be negotiated openly, fairly, and with full knowledge of their implications. Greater assurance that contracts will be honored will improve the international commercial environment, increase the flow of investment, and expand economic transactions. Destructive and politically explosive investment disputes, which spoil the climate for large commitments and investment, will occur less frequently.

- Principles established for transnational enterprises should apply equally to domestic enterprises, where relevant. Standards should be addressed not only to privately owned corporations, but also to state-owned and mixed transnational enterprises, which are increasingly important in the world economy.

A statement of principles is not the only or necessarily a sufficient way of resolving many of the problems affecting transnational enterprises. We must develop others:

- Governments must harmonize their tax treatment of these enterprises. Without coordination, host-country and home-country policies may inhibit productive investment.

- Factfinding and arbitral procedures must be promoted as means for settling Investment disputes. The World Bank's International Center for the Settlement of Investment Disputes and other third-party facilities should be employed to settle the important disputes which inevitably arise.

- Laws against restrictive business practices must be developed, better coordinated among countries, and enforced. The United States has long been vigilant against such abuses in domestic trade, mergers, or licensing of technology. We stand by the same principles internationally. We condemn restrictive practices in setting prices or restraining supplies, whether by private or state-owned transnational enterprises or by the collusion of national governments.

- Insurance for foreign private investors should be limited to multilateralized and should include financial participation by developing countries to reflect our mutual stake in encouraging foreign investment in the service of development.

- And there must be more effective bilateral consultation among governments to identify and resolve investment disputes before they become irritants in political relations.

The United States believes that just solutions are achievable—and necessary. If the world community is committed to economic development, it cannot afford to treat transnational enterprises as objects of economic warfare. The capacity of the international community to deal with this issue constructively will be an important test of whether the search for solutions or the clash of ideologies will dominate our economic future. The implications for economic development are profound.

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An agreement on rules of the game with respect to multinational corporations was an important element of a strategy to expand the flow of development capital, as HK pointed out in his address to the CIEC in Paris on December 16, 1975 ($47):

## Investment and Technology for Development

The balance-of-payments deficits of the developing countries will perhaps moderate as the global economy recovers from recession. But sustained economic growth requires the continuous application of capital, technology, and management skills to development needs.

Private investment has always been a major factor in the growth of the global economy. My own country has benefited from foreign investment throughout its history. Today more than ever, the developing countries need this capital in addition to the limited supply of official development assistance.

To make this possible, governments of developing countries need better access to world capital markets. The United States has urged that technical assistance and expertise be provided to developing countries that are ready to enter long-term private capital markets for the first time. We have proposed a major expansion of the resources of the World Bank's International Finance Corporation (IFC) to strengthen the private sector in developing countries and to enhance their international competitiveness for private capital. We have recommended creation of an international investment trust to mobilize private portfolio capital for investment in local enterprises. And we are contributing to the work of the IMF-World Bank Development Committee to assist in removing impediments to developing countries' access to capital markets.

But we also believe that one of the most important vehicles for transferring capital, technology, and management skills to where they are most needed is private enterprise. There simply is not enough governmental capital available. Because of ideological considerations, these private enterprises operate in an investment climate increasingly clouded by unpredictable national legislation and uncertain rules of the game.

In this environment everybody suffers. Host countries are deprived of the capital resources, technology, and management which these enterprises uniquely provide, as well as a source of tax revenue. Home countries are deprived of the overseas markets, investment income, and the new ideas and techniques which come with foreign contact. And the enterprises themselves are squeezed at both ends, making overseas investment less worthwhile for them and reducing their contribution to home and host country alike and to the global product.

The United States has taken an active part in international efforts to facilitate international investment on a basis that serves the interests of all parties. We are willing to explore voluntary guidelines for the behavior of both transnational enterprises and governments. At the United Nations I stated four basic principles that should be included:

- Transnational enterprises must obey local law and refrain from unlawful intervention in the domestic affairs of host countries.

- Host governments must treat these enterprises equitably, without discrimination among them, and in accordance with international law.

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—Both governments and businesses must
respect the contractual obligations they freely
undertake.

—Principles for transnational enterprises
should apply to domestic enterprises where
relevant.

But efforts should not be limited to gen-
eral guidelines for investment. Other re-
medial measures are possible.

Taxation is one such area. Because they
operate in multiple jurisdictions, transna-
tional enterprises may sometimes be subject
to either double taxation or inappropriate
tax incentives. The result in either case is
that investment patterns are distorted. We
must find ways to enable both host and home
countries to coordinate their tax policies and
make them more equitable to each other and
to productive enterprises.

A second area for improvement is inter-
governmental consultation on investment
disputes. This is especially important to de-
veloping countries whose progress is depend-
ent on a climate conducive to an adequate
flow of investment. It is time to develop
generally accepted international rules for the
settlement of investment disputes and the
arbitration of differences and other guide-
lines for dealing with problems arising be-
tween governments and enterprises. The
United States recommends that the World
Bank's International Center for Settlement
of Investment Disputes be given a greater

role in solving important investment contro-
versies.

International assistance for development
must also focus on the advancement, selec-
tion, and application of modern technology.
Many countries in the developing world are
already on the path of industrialization.
They have proved their capacity to take
advantage of the vast storehouse of modern
technology. The United States encourages
this endeavor. We have long been in the fore-
front of the effort to train more managers,
technicians, and researchers in the develop-
ing countries to carry this forward.

Most technology transfer takes place
through international investment and the
operations of transnational enterprises on a
licensing, equity, or contract basis. The
United States understands the concern of
many developing countries not to become the
repository of obsolescent technology. Tech-
nology must be suited to local needs, the
terms and conditions must be mutually ac-
ceptable, and it must be effectively managed
and utilized. Developing countries must be
enabled to make their own informed choices
of foreign or domestic technology, to adapt
it to their own needs and conditions, and to
manage its application skillfully. This tech-
nology transfer requires the development of
human capabilities—the management and
skills that constitute the infrastructure of
technological development.

People—their training and their place-
ment in a country's management systems—
are the key to making technology a produc-
ing resource. International cooperation can
make no greater contribution to develop-
ment than to foster the training of a corps
of specialists in each country competent to
select, bargain for, and manage technologies.
We see this requirement as an important
topic for consideration by the Commission on
Development, and we will make concrete
proposals to this end.

212

The United States invites other nations to join us in an increase of bilateral support for training and technical assistance to help developing countries find and exploit new sources of fossil fuel and other forms of energy.

Methods of discovering and using less accessible or low-grade resources must be fully utilized. So must technology to produce solar and geothermal power. And these techniques must be suited to the conditions of the developing countries.

The United States believes the topic of energy cooperation should be high on the agenda for the forthcoming dialogue between consumers and producers. We will propose, in this dialogue, creation of an International Energy Institute bringing together developed and developing, consumer and producer, on the particular problem of energy development. The International Energy Agency and the International Atomic Energy Agency should both find ways to give technical assistance and support to this institute.

A second critical area for technological innovation is food production and improvement of nutrition.

During the past decade, a number of international agricultural research centers have been established to adapt techniques to local needs and conditions. In 1971 the Consultative Group for International Agricultural Research was formed to coordinate these efforts. The United States is prepared to expand the capacity of these institutions. In collaboration with national research organizations with more skilled manpower and funds, they could grow into a worldwide research network for development of agricultural technology.

We are also supporting legislation in the Congress to enable our universities to expand their technical assistance and research in the agricultural field.

Nonfood agricultural and forestry products are a third strategic area for technological assistance. The export earnings of many of the poorest countries—and the livelihood of many millions of their people—depend on such products as timber, jute, cotton, and natural rubber, some of which have encountered serious problems in the face of synthetics. They urgently need assistance to improve the productivity and competitiveness of these products and to diversify their economies.

The United States therefore proposes creation of an organization to coordinate and finance such assistance. Its task will be to attract manpower and capital for research. The financing of this effort should be a priority task for the new International Fund for Agricultural Development.

But developing countries' need for technology is not only for development of strategic sectors but for the broad promotion of industrialization itself. This requires the broadest application of skills, resources, and information.

This is not an easy task. The storehouse of technology is already huge and is growing geometrically. Developing practical devices to transfer technology beyond those which already exist will require careful thought. We are prepared to join with other nations in examining new initiatives.

To this end the United States supports creation of an International Industrialization Institute to sponsor and conduct research on industrial technology together with the governments, industries, and research facilities of developing countries.

We support creation of an international center for the exchange of technological information, as a clearinghouse for the sharing of ongoing research and new findings relevant to development.

We will expand our bilateral support of industrial technology appropriate to developing country needs.

We will work with others in this organization in preparing guidelines for the transfer of technology and in the planning of a conference on science and technology for development.

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Further proposals for technology transfer were offered in HK's speech to UNCTAD IV in Nairobi on May 5, 1976 (#64). In a comprehensive program, HK proposed new institutions to adapt technology to the needs of developing countries, improving the availability of technical information, new efforts to train technical personnel, promoting technology transfer through private investment, and organizing UN efforts:

## Technology for Development

Let me now turn to another area of major concern: the application of technology for development.

Technology is at the heart of the development process. It enables man to extend his horizons beyond the mere struggle for existence. Technology draws the fullest measure from the finite resources of our globe. It harnesses the intelligence of man and the forces of nature to meet human needs.

For two centuries technological progress has been fundamental to rapid industrial growth. A central challenge of our time is to extend the benefits of technology to all countries.

There are a number of impediments to a rapid and effective technology transfer from industrialized to developing countries.

First, in many cases technology from industrial countries may not fit the real needs of developing countries. By and large, the challenge is not to transfer a carbon copy of existing technology, but to develop new technology and technological institutions that are most relevant to the conditions of individual developing countries.

Second, developing countries often lack adequate information and expertise to identify the technology which best meets their needs.

Third, there is often a shortage of the trained manpower needed to select, adapt, and effectively manage technology.

Fourth, technology often cannot be separated from capital and management. Hence it is one element of the overall investment process. And to be successful, technology must be applied within a framework of government policies which facilitate and nourish the process of technology transfer.

The task therefore is not simply the turn-

over of formulas or blueprints. We must pursue a comprehensive approach which provides a broad range of programs and incentives to transfer both technology and the fundamental skills that will give it root and effectiveness. To promote this, the United States proposes a five-point approach:

First, to adapt technology to the needs of developing countries, the United States supports the establishment of a network of research and development institutions at the local, regional, and international level. We need to strengthen global research capacities for development and to expand intergovernmental cooperation. Therefore we propose the following:

- An International Industrialization Institute should be established to encourage research and development of industrial technology appropriate to developing countries. A founders conference involving all interested countries should be held no later than this fall.

- The Energy Commission of the Conference on International Economic Cooperation should establish an International Energy Institute to facilitate energy research and the application of energy-related technologies to the special needs of developing countries.

- We should extend existing networks for applied research in the fields of agriculture, health, and education. The creation of new institutions must be accompanied by measures to help the process of technology transfer. To improve cooperation between Industrialized and developing countries, the United States proposes new programs in three fields of advanced science, to which we are prepared to make major contributions of knowledge and experience: in satellite technology,

214

in water resources development, and in
oceans technology.

—Satellite technology offers enormous promise as an instrument for development. Remote-sensing satellites can be applied to survey resources, forecast crops, and improve land use in developing countries. They can help to foresee and evaluate natural disasters. Modern communication technologies, including satellites, have large untapped potential to improve education, training, health services, food production, and other activities essential for development. Therefore, from July through October of this year the United States will make available to interested developing countries demonstrations of the various applications for development of the experimental ATS-6 communications satellite, the Landsat remote sensing satellite, and high resolution photography. We are prepared to cooperate with developing countries in establishing centers, training personnel, and where possible, adapting our civilian satellite programs to their needs.

—The United States will play a leading role in applying water resources technology to such objectives as improving the quality and productivity of agriculture and developing new industry. We will play an active role at the U.N. Water Conference to be held in March of next year, putting forward practical measures to share our knowledge and experience.

—The technology necessary to mine the deep seabed, to manage fisheries, and to exploit the vast potential of the oceans is rapidly being developed. The United States has made major advances in this field. We plan to invite scientists, managers, and technicians from different countries to participate in our scientific projects. And we strongly support provisions in the law of the sea treaty which will provide incentives for sharing of deep-seabed technology appropriate to developing-country needs.

—Finally, there is a pressing need to develop new ways to use technology to improve the basic condition of the poor. The United States is increasing the technical

component of its development programs to
provide basic nutrition, health, and educa-
tion services.

The second element of our program is to improve the amount and quality of technological information available to developing countries and to improve their selection of technology relevant to their needs. We will support the efforts of the U.N. International Center for Exchange of Technological Information to provide comprehensive information on the capabilities and facilities of national and regional information services. For its part, the United States will inventory its national technological information resources and make available, both to developing countries and to the U.N. Center, consultants and other services to improve access to our national information facilities. These include the National Library of Medicine, the division of scientific information of the National Science Foundation, the National Agricultural Library, and the Smithsonian information service.

The United States also supports the proposed UNCTAD advisory service to strengthen the ability of developing nations to identify effectively, select, and negotiate for technology most appropriate to their requirements. We support the concept of regional advisory services under UNCTAD auspices, to provide expertise and resources to the technology requirements of particular regions and countries. These regional centers could act as conduits for the activities of other programs and institutions for the application of technology to developing countries.

Third, to nurture new generations of
technologists and technology managers, the
United States proposes a priority effort to
train individuals who can develop, identify,
and apply technology suited to the needs of
developing countries. To this end:

—Training competent managers of future technology should be central objectives of the proposed International Industrialization Institute and the International Energy Institute.

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—For its part, the United States will encourage universities, research institutes, and industrial training schools in the United States to create special institutes and curricula for technology training for the developing countries; we will provide for and assist their sister institutions in developing countries. We invite other developed countries to join us in this effort.

—Finally, the United States proposes that appropriate incentives and measures be devised to curb the emigration of highly trained manpower from developing countries; for the benefits which developing nations derive from trained technology managers are of no consequence if they leave their home countries.

In this connection, the U.S. Government will encourage the formation of a technology corps, which will parallel our executive service corps in organization and operation. This will be a private, nonprofit organization to which corporations and universities will contribute highly skilled personnel experienced in the management of scientific and technical operations. They will work with and help train local manpower in specific development projects.

The fourth element of our approach is to make the process of transferring existing technology more effective and equitable.

New technology in industrialized countries resides primarily in the private sector. Private enterprise is in the best position to provide packages of management, technology, and capital. To enhance that contribution, both industrialized and developing countries must create an environment conducive to technology transfer.

The United States recommends that voluntary guidelines be developed that set forth the conditions and standards of technology transfer which encourage, facilitate, and maximize the orderly transfer of technology.

The proposed International Resources Bank also contains features which can enhance the ability of developing countries to manage technology and thereby encourage its transfer. In the trilateral agreement with the host nation and the International Re-

sources Bank, the foreign investor would generally undertake to provide both management and technology. The investment project could, by mutual agreement, include the obligation to progressively transfer some of the technology to the host nation over the period of the agreement—as well as accelerate the country's capacity to manage such technology.

The flow of technology in the channels of world commerce can be diverted by restrictive practices. Some practices may directly limit the transfer of technology; in addition, where technology is transferred, restrictive provisions on trade in high-technology products can limit its benefits for others. The United States proposes that international attention be focused on the full range of these practices, with a view to their reduction or elimination.

The fifth element of the U.S. program is to set goals for achievement before and during the U.N. Conference on Science and Technology for Development, now proposed for 1979. The United States strongly supports this conference and its objectives. Preparations for it provide a major opportunity for both developed and developing countries to review their responsibilities for the sharing and use of technology.

To speed our preparations, the United States will convene a national conference next year to bring together our best talent from universities, foundations, and private enterprise. They will be asked to consider the broad range of technological issues of concern to the developing world. They will be invited to help mobilize American resources to assist developing countries to meet their research requirements. And they will be encouraged to prepare detailed American proposals for the conferences and institutes I have described.

We recommend also that the OECD nations urgently study the possibilities of a greater contribution by all industrialized nations to overcoming the problems of technology transfer.

This five-point program represents the most comprehensive effort ever put forward

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by the United States to deal with the chal-
lenge of applying technology to development.
We hope that the UNCTAD Conference will
give these initiatives serious consideration.
We invite your ideas and proposals. Work-
ing together, we can see to it that this age
of technology will improve the quality of
the lives of all of our peoples in a manner
undreamed of by previous generations.

HK made new proposals on technology transfer to the Latin Americans at the OAS General Assembly in Santiago on June 9, 1976 (#68).

Technology

Technology is basic to economic develop-
ment. It is technology that enables us to
master the raw gifts of nature and trans-
form them into the products needed for the
well-being of our peoples.

But technology is not evenly distributed.
There are impediments to its development,
to its transfer, and most importantly, to its
effective utilization. The United States be-
lieves that technology should become a prime
subject of hemispheric cooperation. The
countries in this region have reached stages
of development that enable them to adapt
and create modern technologies. Our poten-
tial thus matches the urgency of practical
needs.

At this point, what are the new directions
we should take together? We have three pro-
posals. The United States believes we in the
hemisphere should:

-Take immediate advantage of promising global initiatives. To seek maximum benefit from the U.N. Conference on Science and Development set for 1979, we propose that the nations here today undertake preparatory consultations on that subject in the Economic Commission for Latin America, whose meeting has been prescribed as a regional forum within the conference program. We will enlist the experience and resources of leading U.S. technology institutions in this hemispheric preparatory effort.

-Increase public and private contacts on research, development, and the application of technology. To this end, the United States will:

Open a technology exchange service for Latin America to provide information on U.S. laws and regulations relating to technology flows and to sources of public and private technology;

Explore cooperative ventures in which small and medium-sized U.S. firms would provide practical technologies to individual Latin American firms, along with the management expertise needed to select, adapt, and exploit those technologies; and

Expand and strengthen Latin America's access to the National Technical Information Service and other facilities of the technology information network of the U.S. Government, which covers 90 percent of the technical information that flows from the $20 billion worth of research that the U.S. Government sponsors annually.

-Develop new regional and subregional structures of consultation and cooperation on problems of technology. To this end, the United States proposes:

First, that we establish a consultative group under the OAS to address and provide recommendations on information problems that Latin America faces in acquiring technology.

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Second, that the OAS, in line with the UNCTAD IV consensus, establish a regional center on technology. The center would facilitate cooperative research and development activities, drawing on both public and private sources. It could stimulate exchanges of qualified technical personnel. And it could begin to attack the problem of incentives to the thousands of technologically trained Latin Americans now living abroad to return to and serve with their own countries. In the view of the United States, such a center should be a cooperative enterprise requiring commitment and contributions in funds, technological resources, and personnel from all of the countries that take part. To get us underway, I propose that we convene a group of experts to examine the need, feasibility, characteristics, and role of an inter-American technology center and report to us before the next OAS General Assembly.

HK convened a national meeting on Science, Technology and Development in Washington on November 17, 1976 (#78). It was a gathering of representatives of industry, universities, foundations, research institutes, private voluntary organizations, and labor unions focusing on the question of technology transfer. HK discussed, speaking from notes, the importance of technology to the process of development:

Now, I have believed for a considerable time that this country, representing the most advanced technology in the world, must be able to make a contribution to what is, after all, the principal way in which development will take place; namely, the development of technology around the world.

We have found ourselves restricted by traditional concepts in which the government would focus primarily on certain types of exchange programs and in which private industry was supposed to do its thing entirely on commercial considerations. And we have lacked a coherent strategy by which the benefits of technology that we possess can be made available in a disciplined and farsighted and cooperative manner.

During the last year we have made a number of proposals in international forums. Our initiatives have generally fallen into two categories.

One, national. We have proposed national and international institutes and programs to provide information, research, and training assistance to developing countries in science and technology.

And secondly, we have attempted to take steps to create an international environment in which the private sector, which is the repository of most of our technology, can make its maximum contribution.

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The first category includes information supporting the creation of an international center for the exchange of technological information; proposing the establishment of a technology exchange service for Latin America; proposing an inventory of U.S. national information sources and improved access to U.S. facilities; supporting the concept of regional advisory services under UNCTAD [U.N. Conference on Trade and Development] auspices; and supporting an offer to host the U.N. Conference on Science and Technology for Development in 1979.

The second category is in the area of research and training. We have increased our support for international agricultural research centers; proposed the establishment of an International Energy Institute; urged the establishment of an International Industrialization Institute; supported the creation of an inter-American technology center; and extended existing support for applied research in nutrition, health, and education.

We have encouraged training by the encouragement of formation of a technology corps and by proposing incentives and measures to curb emigration of highly trained manpower from developing countries.

With respect to encouraging the private sector, we have supported a voluntary code of conduct for the transfer of technology in UNCTAD.

We have supported a voluntary code of conduct for transnational enterprises in the United Nations.

We have proposed the establishment of an International Resources Bank. And if I had not mentioned this I would have been shot in the back by the Deputy Secretary. [Laughter.]

We have supported the examination of restrictive business practices and recommended that other OECD [Organization for Economic Cooperation and Development] nations urgently study the possibility of the greater contribution of all industrial nations to the problems of technology transfer.

Now, all of these were useful steps, extended from a recalcitrant bureaucracy with great pain. [Laughter.]

What we need, however, at this moment, is some integrated concept—something in which all sectors of American life address such questions as:

What technology is it in our interest and in the global interest to transfer?

How is that transfer accomplished in a way that the developing countries can benefit from it and the world economy as a whole advance?

What should be the relationship between our educational institutions, our industrial enterprises, and the host countries so that they can build the most creative partnership, not simply in relationship to any one firm but in relationship to the total environment?

Is the establishment, for example, of regional research centers in developing countries, which has led to major breakthroughs in agricultural research, a useful tool in such fields as industrial technology?

How can multinational corporations relate themselves to universities and the host countries in a deliberate strategy which improves the environment in which they operate and at the same time is of benefit to the host countries?

These and many other questions are the purposes behind our calling this conference.

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Finally, the debt problem of developing countries was a subject of concern even then. At the UNCTAD IV conference in Nairobi on May 6, 1976 (#64), HK urged a new approach that was more individualized and less generalized--which reveals dramatically how different the problem was then from the massive problem it later became:

## Debt Problems

Many countries have had to resort to short-term external borrowing to finance their deficits. Debt payment burdens are mounting; a number of countries are experiencing serious problems in meeting their debt obligations.

Generalized rescheduling of debts is not the answer. It would erode the creditworthiness of countries borrowing in private capital markets. By tying financing to debt, it obscures the significant differences among countries and prevents an appropriate focus on those in most urgent need. And it would not be fair to those nations which have taken strong policy measures to reduce their obligations.

The debt problem must be addressed in relation to each country's specific position and needs. The United States stands ready to help countries suffering acute debt service problems with measures appropriate to each case. The procedures must be agreeable to creditor and debtor alike. The device of a creditor club is a flexible instrument for negotiations.

To improve the basis for consideration of balance-of-payments problems of particular developing countries, the United States proposes that the Finance Commission of the Conference on International Economic Cooperation or another mutually acceptable forum examine the economic and acute financing problems of developing countries.

## The United Nations

HK, particularly in his UNGA addresses, supported expansion of UN activities, particularly in such areas as peacekeeping. See, for example, his maiden address to the UNGA on September 24, 1973 (#2):

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1. A world community requires the curb-
ing of conflict.

The United Nations, in its 28-year history,
has not always been idle in this sphere. In
Indonesia, the Indian Subcontinent, the Mid-
dle East, the Congo, and in Cyprus, it has
shown its ability for effective factfinding,
mediation, and peacekeeping missions. This
central aspect of the U.N.'s work must be
strengthened. On a small planet, so bound to-
gether by technology and so interdependent
economically, we can no longer afford the
constant eruption of conflict and the danger
of its spread.

Yet, in recent years we have found our-
selves locked in fruitless debates about the
inauguration of peacekeeping operations and
over the degree of control the Security Coun-
cil would exercise over peacekeeping machin-
ery—an impasse which insured only that
permanent peacekeeping machinery would
not come into being. Each peacekeeping unit
we have formed to cope with an emergency
has been an improvisation growing out of
argument and controversy.

We should delay no longer. The time has
come to agree on peacekeeping guidelines so
that this organization can act swiftly, con-
fidently, and effectively in future crises. To
break the deadlock, the United States is pre-
pared to consider how the Security Council
can play a more central role in the conduct of

peacekeeping operations. If all countries con-
cerned approach this problem with a desire to
achieve a cooperative solution, the United
Nations can achieve a major step forward
during this session.

Mr. President, fellow delegates: Are we
prepared to accept the imperatives of a
global society and infuse our labors with
a new vision? Or shall we content ourselves
with a temporary pause in the turmoil that
has wracked our century? Shall we proceed
with one-sided demands and sterile confron-
tations? Or shall we proceed in a spirit of
compromise produced by a sense of common
destiny? We must move from hesitant co-
operation born of necessity to genuine col-
lective effort based on common purpose.

It is a choice no country can make alone.
We can repeat old slogans or strive for new
hope. We can fill the record of our proceed-
ings with acrimony, or we can dedicate our-
selves to dealing with man's deepest needs.
The ideal of a world community may be de-
cried as unrealistic—but great constructions
have always been ideals before they can be-
come realities. Let us dedicate ourselves to
this noblest of all possible goals and achieve
at last what has so long eluded us: true un-
derstanding and tolerance among mankind.

In his toast to the UN at the Metropolitan Museum of
Art on October 4, 1973 (#3), HK spoke of the world community
in philosophical terms. Mankind's necessity was to over-
come the "iron laws of history" and build a world community:

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A more sober assessment of the United Nations was the hallmark of HK's speech to a dinner meeting sponsored by the University of Wisconsin Institute of World Affairs at Milwaukee on July 14, 1975 (#35). UN Ambassador Moynihan contributed to this speech, which was a forthright critique of Third World "ideological confrontation, bloc voting, and new attempts to manipulate the Charter to achieve unilateral ends." The most solid bloc in the world was, paradoxically, the bloc of the nonaligned. Distortion of the UN's original mandate was alienating the American people:

The scores of new nations that have become independent since the Second World War are now major actors on the world scene. In their quest for their own progress, they present a challenge to the rest of the world —to demonstrate that the international structure can give them a role, a fair share, dignity, and responsibility.

All of us—allies and adversaries, new nations and old, rich and poor—are part of a world community. Our interdependence on this planet is becoming the central fact of our diplomacy. Energy, resources, environment, population, the uses of space and the seas—these are problems whose benefits and burdens transcend national boundaries. They carry the seeds of political conflict over the coming generation; they challenge the capacities of the international community with new requirements for vision and statesmanship.

Much of our current agenda is therefore global in nature and must be dealt with on a global basis. Within a few weeks there will be two major meetings of the most prominent international organization, the

United Nations. A special session of the General Assembly will be devoted to economic issues, and the 30th regular session of the General Assembly will address the broad range of international problems.

Therefore I would like to use this occasion to place before you and our fellow members of the United Nations a candid assessment of how the U.S. Government views the contemporary United Nations—its capacities and its limitations, its promise and the trends which threaten future progress.

## The Record of the United Nations

Thirty years after the founding of the United Nations, its achievements have been substantial, and its promise is great. Most of the world is at peace. Beyond the absence of armed conflict, there has been a transition from a preoccupation with security to a new concern for the economic and social progress of all mankind. Yet, at the very time when interdependence impels international co-operation and when the membership of the

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United Nations is most universal, the international organization is being tested by a new clash of ideologies and interests and by insistent tactics of confrontation. Such tendencies diminish the prospect for further achievement and threaten the very institution itself.

Let me place these tendencies in historical perspective.

The end of the Second World War brought on a period of idealism and hope. Victory in war against tyrannical regimes—by nations united for that purpose—seemed as much a triumph for liberty as for peace. The end of the colonial era was shortly to begin and was clearly in prospect. The awesome power of nuclear weapons, ironically, gave hope that the imperatives of collective security and peaceful settlement of disputes would at last impress themselves on mankind. The League of Nations had failed, but the cost of another failure now seemed so overwhelming that it was possible to hope that the nations of the world would be obliged to make the United Nations succeed.

No nation embraced this hope more genuinely than the United States. No country more seriously looked for the United Nations to replace force and domination with co-operation. No government more earnestly sought to create a world organization with a capacity to act. It is worth recalling that a year after the San Francisco Conference, when the United States was the sole possessor of nuclear weapons, we offered to turn this entire technology over to the United Nations.

Even then American spokesmen were careful to insist that there were realistic limits to the scope of the new organization. Of these limits the most important, even if perhaps the easiest to overlook, is that the United Nations is not a world government; it is an organization of sovereign states. It is not an entity apart from its membership. It reflects the world context in which it operates —its diversity, its imperfections, its many centers of power and initiative, its competing values, its worldly compound of nobility and tragedy.

The founders' hope for peace rested not on

a naive belief in the perfectibility of man but on the hope that the major powers, given a dominant role in the Security Council, would be able to concert together to keep the peace. This hope, of course, proved stillborn when the United Nations became an arena for the confrontations of the cold war.

A generation later, its record in maintaining the peace shows both success and failure. There have been local wars; yet there has been no general war. More than once, small conflicts which could have led in the past to great ones have been contained through the efforts of the United Nations.

Time and again—in the eastern Mediterranean, in the Middle East, in the Congo, in Kashmir—the peacekeeping role of the United Nations has proved indispensable for settlement, guarantees, and prevention of major-power intervention. While a far cry from the concept of collective security originally envisioned, these operations have proven valuable and increasingly indispensable. They represent the most advanced manifestations of international cooperation for security yet achieved.

The United Nations has understood the principle that peace is not the same as the status quo, but must embrace procedures for peaceful change. Whether by special commissions or mediators or through the expanded role of the Secretary General within his broad responsibilities under article 99 of the charter, the United Nations has offered a flexible instrument of pacific settlement on a score of occasions since its founding.

The United Nations has provided a forum for debate and negotiation on regional or global problems and for multilateral efforts for arms control and disarmament. The talks provide a safety valve and a sounding board; in the corridors, quiet progress is often being made.

We found early on that there were limits to U.N. action on behalf of peace and security. Its writ can run no further than the agreement of its members. And on the sweeping issues of war and peace, it is the great powers, by virtue of their size, military strength, economic power, and political in-

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fluence, who bear the principal responsibility for world stability and security. Of late, as the great powers are learning the practices of coexistence, there is hope that the United Nations can find renewed possibilities for effective action in accordance with the vision of its founders.

The United Nations, originally concerned primarily with issues of peace and security, has been the focus of increasing attention to economic and social issues. The U.N. Charter contains a commitment "to employ international machinery for the promotion of the economic and social advancement of all peoples." Today, roughly nine-tenths of expenditures within the U.N. system relate to economic and social cooperation. We welcome this evolution and have contributed generously to it.

Indeed, it is in these fields that the work of the United Nations has been most successful and yet the most unheralded. Its specialized agencies have been effectively involved with countless areas of human and international concern—speeding decolonization; spreading education, science, and technology; organizing global cooperation to combat hunger and disease, to protect the environment, and to limit population growth; regulating international transport and communication and peaceful nuclear power; advancing human rights and expanding international law among nations and in outer space and on the seas; preserving the priceless cultural heritage of mankind. It is striking, and of great importance for the future, that the United Nations has been able to respond creatively to so many of the challenges of the modern age.

Thus the United Nations is of considerable importance for the world's future. It has accommodated our traditional security and political concerns to the new conditions of international diplomacy; it has extended its reach—even before most nations did—toward the new agenda that now confronts the world community. The United Nations is both a symbol of our interdependence and our most universal instrument for common progress.

In this connection, I want to pay tribute

to the outstanding leadership given to the United Nations by its Secretary General, Kurt Waldheim. He is tireless and totally dedicated to peace, fairness, and the future of the United Nations. The rapidity and efficiency with which he organized and dispatched peacekeeping forces to the Middle East in late 1973 was but one example of the many services he has rendered the organization and the international community.

## The United States and the United Nations

Yet with all these achievements, the future of the United Nations is clouded. Much that has transpired at the United Nations in recent years gives us pause. At the very moment when great-power confrontations are waning, troubling trends have appeared in the General Assembly and some of its specialized agencies. Ideological confrontation, bloc voting, and new attempts to manipulate the charter to achieve unilateral ends threaten to turn the United Nations into a weapon of political warfare rather than a healer of political conflict and a promoter of human welfare.

The United Nations naturally mirrors the evolution of its composition. In its first phase it reflected the ideological struggle between the West and East; during that period the United Nations generally followed the American lead. Time and again in those days there were some 50 votes in support of our position and only a handful of Communist-bloc members against.

Ten years later, when membership had grown to more than 80, our dominance in the General Assembly no longer was assured. Neither East nor West was able to prevail. In the Security Council the American position was still sustained, while the Soviet Union was required to cast veto after veto in order to protect what it considered to be its vital interests.

But with the quantum leap to the present membership of 138, the past tendencies of bloc politics have become more pronounced and more serious. The new nations, for understandable reasons, turned to the General

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Assembly, in which they predominated, in
a quest for power that simply does not re-
side there. The Assembly cannot take com-
pulsory legal decisions. Yet numerical ma-
jorities have insisted on their will and
objectives even when in population and
financial contributions they were a small
proportion of the membership.

In the process, a forum for accommoda-
tion has been transformed into a setting
for confrontation. The moral influence which
the General Assembly should exercise has
been jeopardized and could be destroyed if
governments—particularly those who are its
main financial supporters—should lose con-
fidence in the organization because of the
imposition of a mechanical and increasingly
arbitrary will.

It is an irony that at the moment the
United States has accepted nonalignment and
the value of diversity, those nations which
originally chose this stance to preserve their
sovereign independence from powerful mili-
tary alliances are forming a rigid grouping
of their own. The most solid bloc in the
world today is, paradoxically, the alignment
of the nonaligned. This divides the world
into categories of North and South, develop-
ing and developed, imperial and colonial, at
the very moment in history when such
categories have become irrelevant and mis-
leading.

Never before has the world been more in
need of cooperative solutions. Never before
have the industrial nations been more ready
to deal with the problems of development
in a constructive spirit. Yet lopsided, loaded
voting, biased results, and arbitrary tactics
threaten to destroy these possibilities. The
utility of the General Assembly both as a
safety valve and as an instrument of inter-
national cooperation is being undermined.
Tragically, the principal victims will be the
countries who seek to extort what substan-
tially could be theirs if they proceeded co-
operatively.

An equally deplorable development is the
trend in the specialized agencies to focus
on political issues and thereby deflect the
significant work of these agencies. UNESCO
[U.N. Educational, Scientific, and Cultural

Organization], designed for cultural matters,
and the International Labor Organization
have been heavily politicized. An egregious
recent case came in the World Food Council
in Rome, where the very nations who des-
perately need, and would most benefit from,
food assistance threatened to abort its work
by disruptive tactics unworthy of an inter-
national organization. This Council grew
out of the American initiatives at the
World Food Conference last year. It re-
flects our deepest humanitarian concerns;
it represents a serious effort on our part
to eliminate hunger and malnutrition. Abuse
by those whom we are trying to help,
attacks on our motives by the beneficiaries
of our efforts, threaten to undermine the
very fabric of cooperation in a field of cru-
cial long-range importance to mankind.

We realize that those of us who wish to
surmount the current crisis must show some
understanding of its origins. The major
powers have hardly always set a consistent
example of altruistic or benevolent behavior.
The nations which would seek to coerce the
industrialized countries have themselves
been coerced in the past. History haunts us
all. But it is precisely to transcend that his-
tory that the United Nations was founded.
And it is precisely to arrest such trends that
the United States is calling attention to them
today.

The process is surely self-defeating. Ac-
cording to the rules of the General Assem-
bly, the coerced are under no compulsion to
submit. To the contrary, they are given all
too many incentives simply to depart the
scene, to have done with the pretense. Such
incentives are ominously enhanced when the
General Assembly and specialized agencies
expel member nations which for one reason
or another do not meet with their ap-
proval.

Our concern has nothing to do with our
attitude toward the practices or policies of
the particular governments against which
action is being taken. Our position is con-
stitutional. If the United Nations begins to
depart from its charter, where suspension
and expulsion are clearly specified preroga-
tives of the Security Council, we fear for

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the integrity and the survival of the General Assembly itself, and no less for that of the specialized agencies. Those who seek to manipulate U.N. membership by procedural abuse may well inherit an empty shell.

We are determined to oppose tendencies which, in our view, will undermine irreparably the effectiveness of the United Nations. It is the smaller members of the organization who would lose the most. They are more in need of the United Nations than the larger powers such as the United States which can prosper within or outside the institution.

Ways must be found for power and responsibility in the Assembly and in the specialized agencies to be more accurately reflective of the realities of the world. The United States has been by far the largest financial supporter of the United Nations; but the support of the American people, which has been the lifeblood of the organization, will be profoundly alienated unless fair play predominates and the numerical majority respects the views of the minority. The American people are understandably tired of the inflammatory rhetoric against us, the all-or-nothing stance accompanied by demands for our sacrifice which too frequently dominate the meeting halls of the United Nations.

The United States, despite these trends, intends to do everything in our power to support and strengthen the United Nations in its positive endeavors. With all its limitations and imperfections, the world body remains an urgent necessity. We are eager to cooperate, but we are also determined to insist on orderly procedures and adherence to the charter. The United Nations was never intended as an organization of like-minded states but, rather, an arena to accommodate and respect different policies and different interests. The world needs cooperative, not arbitrary, action; joint efforts, not imposed solutions. In this spirit the United States will do what it can to make the United Nations a vital hope for a better future.

## The Central Role of the United Nations

Dag Hammerskjold once predicted that the day would come when people would see the United Nations for what it really is—not the abstract painting of some artist, but a drawing done by the peoples of the world. And so it is—not the perfect institution of the dreamers who saw it as the only true road to world harmony and not the evil instrument of world domination that the isolationists once made it out to be.

Rather it is, like so many human institutions before it, an imperfect instrument—but one of great hope nonetheless. The United States remains dedicated to the principles upon which the United Nations was founded. We continue to believe it can be a mighty and effective vehicle for preserving the peace and bridging the gap between the world's rich and poor. We will do all we can to make it so.

The past decade, and particularly the past several years, have been a difficult time for America. We have known the agony of internal dissension and political turmoil and the bitter costs of a lengthy war. But our nation has come through all this and its most difficult constitutional crisis since the Civil War with our institutions intact and our people resilient. And we have seen that the world still looks to us for leadership in preserving the peace and promoting economic advance for all mankind.

But the past decade has also surely shown that—strong and prosperous as we are—we cannot remake the world alone. Others must do their part and bear their responsibility for building the better world we all seek for the generations that will come after us.

In this endeavor, the United Nations plays a central role. It is there that each nation, large or small, rich or poor, can—if it will—make its contribution to the betterment of all. It is there that nations must realize that restraint is the only principle that can save the world from chaos and that our destinies are truly intertwined on this small planet. It is there that we will see whether men and nations have the wisdom and courage to make a reality of the ideals of the charter and, in the end, to turn the Parliament of Man into a true expression of the conscience of humanity.

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A similarly cautionary tone was evident in HK's last address to the UNGA, September 30, 1976 (#76). The fragmentation of the UN was, of course, a reflection of the divisions of the world. But it would be a tragedy if the current trends continued and dissipated the world's hopes for community:

The United Nations was born of the conviction that peace is both indivisible and more than mere stability, that for peace to be lasting it must fulfill mankind's aspirations for justice, freedom, economic well-being, the rule of law, and the promotion of human rights. But the history of this organization has been in considerable measure the gradual awareness that humanity would not inevitably share a single approach to these goals.

The United Nations has survived—and helped to manage—30 years of vast change in the international system. It has come through the bitterness of the cold war. It has played a vital role in the dismantling of the colonial empires. It has helped moderate conflicts and is manning truce lines in critical parts of the world. It has carried out unprecedented efforts in such areas as public health, development assistance, and technical cooperation.

But the most important challenge of this organization lies still ahead: to vindicate mankind's positive and nobler goals and help nations achieve a new understanding of community.

With modern communications, human endeavor has become a single experience for peoples in every part of the planet. We share the wonders of science and technology, the trials of industrialization and social change, and a constant awareness of the fate and dreams of our fellow men.

The world has shrunk, but the nations of the world have not come closer together. Paradoxically, nationalism has been on the rise at the precise time when the most serious issues we all face can only be resolved through a recognition of our interdependence. The moral and political cohesion of our world may be eroding just when a sense of community has become indispensable.

Fragmentation has affected even this body. Nations have taken decisions on a bloc or regional basis by rigid ideologies, before even listening to the debate in these

229

Let us never forget that the United Na-
tions benefits the smaller and weaker
nations most of all. It is they that would
suffer most from its failure. For without the
rule of law, disputes would be settled as
they have been all too frequently and pain-
fully in history—by test of strength. It is
not the weak that will prevail in the world
of chaos.

The United States believes that this 31st
General Assembly must free itself of the
ideological and confrontational tactics that
marked some of its predecessors and dedi-
cate itself to a program of common action.

The United States comes to the General
Assembly prepared to work on programs
of common action. We will offer concrete
proposals. We will listen to the ideas of
others. We will resist pressure and seek
cooperation.

halls; on many issues positions have been
predetermined by prior conferences con-
taining more than half the membership of
the United Nations. The tendency is wide-
spread to come here for battle rather than
negotiation. If these trends continue, the
hope for world community will dissipate
and the moral influence of this organiza-
tion will progressively diminish.

This would be a tragedy. Members of this
organization are today engaged in a multi-
plicity of endeavors to find just solutions
for complex and explosive problems. There
is a fragile tranquillity, but beneath the
surface it is challenged by fundamental
forces of change—technological, economic,
social. More than ever this is a time for
statecraft and restraint, for persistence but
also daring in the pursuit of peace and
justice. The dogmas of perpetual strife pro-
duce only bloodshed and bitterness; they
unleash the forces of destruction and re-
pression and plant the seeds of future con-
flict. Appeals to hatred—whether on the
basis of race or class or color or nationality
or ideology—will, in the end, rebound
against those who launch them and will not
advance the cause of freedom and justice
in the world.

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## Law of the Sea

One of the specific topics in the general theme of interdependence was the negotiation on Law of the Sea.

HK gave a speech on the subject to the ABA Convention in Montreal on August 11, 1975 (#37). The Law of the Sea negotiation was a test case of the effort to shape a global consensus, to build order out of chaos, and to advance the goals of international law. "Law has an opportunity to civilize us in the early stages of a new competitive activity." Again, HK quoted Kant on the theme of moral principle and practical necessity:

> Justice Holmes said of the common law that it "is not a brooding omnipresence in the sky but the articulate voice of some sovereign or quasi-sovereign that can be identified." But international politics recognizes no sovereign or even quasi-sovereign power beyond the nation-state.

Thus in international affairs the age-old struggle between order and anarchy has a political as well as a legal dimension. When competing national political aims are pressed to the point of unrestrained competition, the precepts of law prove fragile. The unrestrained quest for predominance brooks no legal restraints. In a democratic society law flourishes best amidst pluralistic institutions. Similarly in the international arena stability requires a certain equilibrium of power. Our basic foreign policy objective inevitably must be to shape a stable and cooperative global order out of diverse and contending interests.

But this is not enough. Preoccupation with interests and power is at best sterile and at

worst an invitation to a constant test of strength. The true task of statesmanship is to draw from the balance of power a more positive capacity to better the human condition—to turn stability into creativity, to transform the relaxation of tensions into a strengthening of freedoms, to turn man's preoccupations from self-defense to human progress.

An international order can be neither stable nor just without accepted norms of conduct. International law both provides a means and embodies our ends. It is a repository of our experience and our idealism—a body of principles drawn from the practice of states and an instrument for fashioning new patterns of relations between states. Law is an expression of our own culture and yet a symbol of universal goals. It is the heritage of our past and a means of shaping our future.

The challenge of international order takes on unprecedented urgency in the contempo-

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rary world of interdependence. In an increas-
ing number of areas of central political rele-
vance, the legal process has become of major
concern. Technology has driven us into vast
new areas of human activity and opened up
new prospects of either human progress or
international contention. The use of the
oceans and of outer space, the new excesses
of hijacking, terrorism, and warfare, the ex-
pansion of multinational corporations, will
surely become areas of growing dispute if
they are not regulated by a legal order.

The United States will not seek to impose
a parochial or self-serving view of the law
on others. But neither will we carry the quest
for accommodation to the point of prejudic-
ing our own values and rights. The new
corpus of the law of nations must benefit all
peoples equally; it cannot be the preserve of
any one nation or group of nations.

The United States is convinced in its own
interest that the extension of legal order is
a boon to humanity and a necessity. The tra-
ditional aspiration of Americans takes on a
new relevance and urgency in contemporary
conditions. On a planet marked by interde-
pendence, unilateral action and unrestrained
pursuit of the national advantage inevitably
provoke counteraction and therefore spell fu-
tility and anarchy. In an age of awesome
weapons of war, there must be accommoda-
tion or there will be disaster.

Therefore there must be an expansion of
the legal consensus, in terms both of subject
matter and participation. Many new and im-
portant areas of international activity, such
as new departures in technology and com-
munication, cry out for agreed international
rules. In other areas, juridical concepts have
advanced faster than the political will that is
indispensable to assure their observance—
such as the U.N. Charter provisions govern-
ing the use of force in international relations.
The pace of legal evolution cannot be allowed
to lag behind the headlong pace of change
in the world at large. In a world of 150 na-

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tions and competing ideologies, we cannot afford to wait upon the growth of customary international law. Nor can we be content with the snail's pace of treatymaking as we have known it in recent years in international forums.

We are at a pivotal moment in history. If the world is in flux, we have the capacity and hence the obligation to help shape it. If our goal is a new standard of international restraint and cooperation, then let us fashion the institutions and practices that will bring it about.

This morning I would like to set forth the American view on some of those issues of law and diplomacy whose solution can move us toward a more orderly and lawful world. These issues emphasize the contemporary international challenge—in the oceans, where traditional law has been made obsolete by modern technology; in outer space, where endeavors undreamed of a generation ago impinge upon traditional concerns for security and for sovereignty; in the laws of war, where new practices of barbarism challenge us to develop new social and international restraint; and in international economics, where transnational enterprises conduct their activities beyond the frontier of traditional political and legal regulation.

I shall deal in special detail with the law of the sea in an effort to promote significant and rapid progress in this vitally important negotiation.

## The Law of the Sea

The United States is now engaged with some 140 nations in one of the most comprehensive and critical negotiations in history, an international effort to devise rules to govern the domain of the oceans. No current international negotiation is more vital for the long-term stability and prosperity of our globe.

One need not be a legal scholar to understand what is at stake. The oceans cover 70 percent of the earth's surface. They both unite and divide mankind. The importance of free navigation for the security of nations, including our country, is traditional; the eco-

nomic significance of ocean resources is becoming enormous.

From the 17th century until now, the law of the seas has been founded on a relatively simple precept: freedom of the seas, limited only by a narrow belt of territorial waters generally extending three miles offshore. Today the explosion of technology requires new and more sophisticated solutions.

—In a world desperate for new sources of energy and minerals, vast and largely untapped reserves exist in the oceans.

—In a world that faces widespread famine and malnutrition, fish have become an increasingly vital source of protein.

—In a world clouded by pollution, the environmental integrity of the oceans turns into a critical international problem.

—In a world where 95 percent of international trade is carried on the seas, freedom of navigation is essential.

Unless competitive practices and claims are soon harmonized, the world faces the prospect of mounting conflict. Shipping tonnage is expected to increase fourfold in the next 30 years. Large self-contained factory vessels already circle the globe and dominate fishing areas that were once the province of small coastal boats. The worldwide fish harvest is increasing dramatically, but without due regard to sound management or the legitimate concerns of coastal states. Shifting population patterns will soon place new strains on the ecology of the world's coastlines.

The current negotiation may thus be the world's last chance. Unilateral national claims to fishing zones and territorial seas extending from 50 to 200 miles have already resulted in seizures of fishing vessels and constant disputes over rights to ocean space. The breakdown of the current negotiation, a failure to reach a legal consensus, will lead to unrestrained military and commercial rivalry and mounting political turmoil.

The United States strongly believes that law must govern the oceans. In this spirit, we welcomed the U.N. mandate in 1970 for a multilateral conference to write a comprehensive treaty governing the use of the

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oceans and their resources. We contributed substantially to the progress that was made at Caracas last summer and at Geneva this past spring, which produced a "single negotiating text" of a draft treaty. This will focus the work of the next session, scheduled for March 1976 in New York. The United States intends to intensify its efforts.

The issues in the law of the sea negotiation stretch from the shoreline to the farthest deep seabed. They include:

- The extent of the territorial sea and the related issues of guarantees of free transit through straits;

- The degree of control that a coastal state can exercise in an offshore economic zone beyond its territorial waters; and

- The international system for the exploitation of the resources of the deep seabeds.

If we move outward from the coastline, the first issue is the extent of the territorial sea, the belt of ocean over which the coastal state exercises sovereignty. Historically, it has been recognized as three miles; that has been the long-established U.S. position. Increasingly, other states have claimed 12 miles or even 200.

After years of dispute and contradictory international practice, the Law of the Sea Conference is approaching a consensus on a 12-mile territorial limit. We are prepared to accept this solution, provided that the unimpeded transit rights through and over straits used for international navigation are guaranteed. For without such guarantees, a 12-mile territorial sea would place over 100 straits—including the Straits of Gibraltar, Malacca, and Bab el Mandeb—now free for international sea and air travel under the jurisdictional control of coastal states. This the United States cannot accept. Freedom of international transit through these and other straits is for the benefit of all nations, for trade and for security. We will not join in an agreement which leaves any uncertainty about the right to use world communication routes without interference.

Within 200 miles of the shore are some of

the world's most important fishing grounds as well as substantial deposits of petroleum, natural gas, and minerals. This has led some coastal states to seek full sovereignty over this zone. These claims, too, are unacceptable to the United States. To accept them would bring 30 percent of the oceans under national territorial control—in the very areas through which most of the world's shipping travels.

The United States joins many other countries in urging international agreement on a 200-mile offshore economic zone. Under this proposal, coastal states would be permitted to control fisheries and mineral resources in the economic zone, but freedom of navigation and other rights of the international community would be preserved. Fishing within the zone would be managed by the coastal state, which would have an international duty to apply agreed standards of conservation. If the coastal state could not harvest all the allowed yearly fishing catch, other countries would be permitted to do so. Special arrangements for tuna and salmon, and other fish which migrate over large distances, would be required. We favor also provisions to protect the fishing interests of landlocked and other geographically disadvantaged countries.

In some areas the continental margin extends beyond 200 miles. To resolve disagreements over the use of this area, the United States proposes that the coastal states be given jurisdiction over continental margin resources beyond 200 miles, to a precisely defined limit, and that they share a percentage of financial benefit from mineral exploitation in that area with the international community.

Beyond the territorial sea, the offshore economic zone, and the continental margin lie the deep seabeds. They are our planet's last great unexplored frontier. For more than a century we have known that the deep seabeds hold vast deposits of manganese, nickel, cobalt, copper, and other minerals, but we did not know how to extract them. New modern technology is rapidly advancing the time when their exploration and commercial exploitation will become a reality.

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The United Nations has declared the deep seabeds to be the "common heritage of man-kind."² But this only states the problem. How will the world community manage the clash of national and regional interests or the inequality of technological capability? Will we reconcile unbridled competition with the imperative of political order?

The United States has nothing to fear from competition. Our technology is the most advanced, and our Navy is adequate to protect our interests. Ultimately, unless basic rules regulate exploitation, rivalry will lead to tests of power. A race to carve out exclusive domains of exploitation on the deep seabeds, even without claims of sovereignty, will menace freedom of navigation and in-vite a competition like that of the colonial powers in Africa and Asia in the last cen-tury.

This is not the kind of world we want to see. Law has an opportunity to civilize us in the early stages of a new competitive activity.

We believe that the Law of the Sea Treaty must preserve the right of access presently enjoyed by states and their citizens under international law. Restrictions on free access will retard the development of seabed re-sources. Nor is it feasible, as some develop-ing countries have proposed, to reserve to a new international seabed organization the sole right to exploit the seabeds.

Nevertheless the United States believes strongly that law must regulate interna-tional activity in this area. The world com-munity has a historic opportunity to manage this new wealth cooperatively and to dedicate resources from the exploitation of the deep seabeds to the development of the poorer countries. A cooperative and equitable solu-tion can lead to new patterns of accommoda-tion between the developing and industrial countries. It could give a fresh and concilia-

tory cast to the dialogue between the indus-trialized and so-called Third World. The legal regime we establish for the deep sea-seds can be a milestone in the legal and political development of the world com-munity.

The United States has devoted much thought and consideration to this issue. We offer the following proposals:

- An international organization should be created to set rules for deep seabed mining.

- This international organization must preserve the rights of all countries, and their citizens, directly to exploit deep seabed re-sources.

- It should also insure fair adjudication of conflicting interests and security of in-vestment.

- Countries and their enterprises mining deep seabed resources should pay an agreed portion of their revenues to the international organization, to be used for the benefit of developing countries.

- The management of the organization and its voting procedures must reflect and balance the interests of the participating states. The organization should not have the power to control prices or production rates.

- If these essential U.S. interests are guaranteed, we can agree that this organi-zation will also have the right to conduct mining operations on behalf of the interna-tional community primarily for the benefit of developing countries.

- The new organization should serve as a vehicle for cooperation between the techno-logically advanced and the developing coun-tries. The United States is prepared to explore ways of sharing deep seabed tech-nology with other nations.

- A balanced commission of consumers, seabed producers, and land-based producers could monitor the possible adverse effects of deep seabed mining on the economies of those developing countries which are substantially dependent on the export of minerals also pro-duced from the deep seabeds.

The United States believes that the world community has before it an extraordinary

²For text of the Declaration of Principles Govern-ing the Seabed and the Ocean Floor, and the Subsoil Thereof, Beyond the Limits of National Jurisdiction (A/RES/2749 (XXV), adopted on Dec. 17, 1970), see BULLETIN of Feb. 1, 1971, p. 155.

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opportunity. The regime for the deep sea-
beds can turn interdependence from a slogan
into reality. The sense of community which
mankind has failed to achieve on land could
be realized through a regime for the
oceans.

The United States will continue to make
determined efforts to bring about final prog-
ress when the Law of the Sea Conference
reconvenes in New York next year. But we
must be clear on one point: The United
States cannot indefinitely sacrifice its own
interest in developing an assured supply of
critical resources to an indefinitely prolonged
negotiation. We prefer a generally accept-
able international agreement that provides a
stable legal environment *before* deep seabed
mining actually begins. The responsibility
for achieving an agreement before actual
exploitation begins is shared by all nations.
We cannot defer our own deep seabed mining
for too much longer. In this spirit, we and
other potential seabed producers can con-
sider appropriate steps to protect current
investment and to insure that this invest-
ment is also protected *in the* treaty.

The conference is faced with other impor-
tant issues:

—Ways must be found to encourage ma-
rine scientific research for the benefit of all
mankind while safeguarding the legitimate
interests of coastal states in their economic
zones.

—Steps must be taken to protect the
oceans from pollution. We must establish
uniform international controls on pollution
from ships and insist upon universal respect
for environmental standards for continental
shelf and deep seabed exploitation.

—Access to the sea for landlocked coun-
tries must be assured.

—There must be provisions for compulsory and impartial third-party settlement of disputes. The United States cannot accept unilateral interpretation of a treaty of such scope by individual states or by an international seabed organization.

The pace of technology, the extent of eco-
nomic need, and the claims of ideology and
national ambition threaten to submerge the

difficult process of negotiation. The United
States therefore believes that a just and
beneficial regime for the oceans is essential
to world peace.

For the self-interest of every nation is
heavily engaged. Failure would seriously
impair confidence in global treatymaking and
in the very process of multilateral accom-
modation. The conclusion of a comprehen-
sive Law of the Sea Treaty on the other hand
would mark a major step toward a new
world community.

The urgency of the problem is illustrated
by disturbing developments which continue
to crowd upon us. Most prominent is the
problem of fisheries.

The United States cannot indefinitely accept unregulated and indiscriminate foreign fishing off its coasts. Many fish stocks have been brought close to extinction by foreign overfishing. We have recently concluded agreements with the Soviet Union, Japan, and Poland which will limit their catch; and we have a long and successful history of conservation agreements with Canada. But much more needs to be done.

Many within Congress are urging us to
solve this problem unilaterally. A bill to
establish a 200-mile fishing zone passed the
Senate last year; a new one is currently be-
fore the House.

The Administration shares the concern
which has led to such proposals. But uni-
lateral action is both extremely dangerous
and incompatible with the thrust of the nego-
tiations described here. The United States
has consistently resisted the unilateral
claims of other nations, and others will al-
most certainly resist ours. Unilateral legisla-
tion on our part would almost surely prompt
others to assert extreme claims of their own.
Our ability to negotiate an acceptable inter-
national consensus on the economic zone will
be jeopardized. If every state proclaims its
own rules of law and seeks to impose them
on others, the very basis of international law
will be shaken, ultimately to our own detri-
ment.

We warmly welcome the recent statement
by Prime Minister Trudeau reaffirming the
need for a solution through the Law of the

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Sea Conference rather than through uni-
lateral action. He said:

Canadians at large should realize that we have
very large stakes indeed in the Law of the Sea
Conference and we would be fools to give up those
stakes by an action that would be purely a tem-
porary, paper success.

That attitude will guide our actions as well. To conserve the fish and protect our fishing industry while the treaty is being negotiated, the United States will negotiate interim arrangements with other nations to conserve the fish stocks, to insure effective enforcement, and to protect the livelihood of our coastal fishermen. These agreements will be a transition to the eventual 200-mile zone. We believe it is in the interests of states fishing off our coasts to cooperate with us in this effort. We will support the efforts of other states, including our neighbors, to deal with their problems by similar agreements. We will consult fully with Congress, our states, the public, and foreign governments on arrangements for implementing a 200-mile zone by virtue of agreement at the Law of the Sea Conference.

Unilateral legislation would be a last resort. The world simply cannot afford to let the vital questions before the Law of the Sea Conference be answered by default. We are at one of those rare moments when mankind has come together to devise means of preventing future conflict and shaping its destiny rather than to solve a crisis that has occurred or to deal with the aftermath of war. It is a test of vision and will and of statesmanship. It must succeed. The United States is resolved to help conclude the conference in 1976, before the pressure of events and contention places international consensus irretrievably beyond our grasp.

Since the early days of the Republic,
Americans have seen that their nation's self-
interest could not be separated from a just
and progressive international legal order.
Our Founding Fathers were men of law, of
wisdom, and of political sophistication. The
heritage they left is an inspiration as we
face an expanding array of problems that

are at once central to our national well-being
and soluble only on a global scale.

The challenge of the statesman is to recognize that a just international order cannot be built on power, but only on restraint of power. As Felix Frankfurter said:

Fragile as reason is and limited as law is as the
expression of the institutionalized medium of rea-
son, that's all we have standing between us and the
tyranny of mere will and the cruelty of unbridled,
unprincipled, undisciplined feeling.

If the politics of ideological confrontation and strident nationalism become pervasive, broad and humane international agreement will grow ever more elusive and unilateral actions will dominate. In an environment of widening chaos the stronger will survive and may even prosper temporarily. But the weaker will despair, and the human spirit will suffer.

The American people have always had a higher vision: a community of nations that has discovered the capacity to act according to man's more noble aspirations. The principles and procedures of the Anglo-American legal system have proven their moral and practical worth. They have promoted our national progress and brought benefits to more citizens more equitably than in any society in the history of man. They are a heritage and a trust which we all hold in common. And their greatest contribution to human progress may well lie ahead of us.

The philosopher Kant saw law and freedom, moral principle and practical necessity, as parts of the same reality. He saw law as the inescapable guide to political action. He believed that sooner or later the realities of human interdependence would compel the fulfillment of the moral imperatives of human aspiration.

We have reached that moment in time
where moral and practical imperatives, law,
and pragmatism point toward the same
goals.

The foreign policy of the United States must reflect the universal ideals of the American people. It is no accident that a dedication to international law has always been a central feature of our foreign policy. And so it is today—inescapably—as for the first time in history we have the opportunity and the duty to build a true world community.

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On April 8, 1976, HK spoke to the Foreign Policy Association in New York (#58) on the same subject. The Law of the Sea negotiation was "one of the most important international negotiations that has ever taken place," HK declared. Considerable progress had been made in the multilateral talks. The "most complex and vital" issue remaining was the problem of deep seabed mining, on which HK outlined a new US proposal. It was a "unique moment in history," when mankind could see that it was at a turning point:

I want to speak to you today about one of the most important international negotiations that has ever taken place: the global conference now underway here in New York on the law of the sea. Last summer in Montreal I set forth a comprehensive U.S. program to help bring matters at this year's conference to a rapid and successful conclusion. Today I will offer new proposals which address the remaining important issues before us, so that this great negotiation may lead to a final result this year.

For we live in an age when the accelerating forces of modern life—technological, economic, social, and political—are leading the peoples of the world into unprecedented and interrelated areas of human activity. New prospects are opening before us—fraught with potential for international contention but filled as well with the hope of unparalleled human advancement.

The principal problems which all nations face today are truly global in nature. They transcend geographic and political boundaries. Their complexity eludes the conventional solutions of the past, and their pace outstrips the measured processes of traditional diplomacy.

There is the imperative of peace—the familiar but vastly more urgent requirements of maintaining global stability, resolving conflicts, easing tensions—these issues dominate the agenda of relations

between East and West. And there are the new challenges of the world's economy and of cooperative solutions to such international problems as food, energy, population, trade, and the environment. These are the agenda of the modern period, particularly in the evolving relationship between the developed and the developing nations.

In an international order composed of sovereign states, the precondition of effective policy is security. But security, while essential, is not enough. The American people will never be satisfied with a world whose stability depends on a balance of terror constantly contested.

Therefore, side by side with seeking to maintain the security of free countries, the United States has striven to build a new world based on cooperation. We are convinced that our common progress requires nations to acknowledge their interdependence and act out of a sense of community. Therefore, at the seventh special session of the U.N. General Assembly in September of last year we made a major effort to project our vision of a more positive future. We sought to mobilize collaboration on a global scale on many current issues of economic development. We were gratified by the response to our initiatives. We are prepared to accelerate our effort.

Virtually all major elements of this new age of interdependence are involved in one of the great issues of our time: the question of mankind's use of the oceans. In no area are the challenges more complex or the stakes higher. No other common effort holds so much positive hope for the future of relations

¹ Made before the Foreign Policy Association, the U.S. Council of the International Chamber of Commerce, and the U.N. Association of the U.S.A. at New York, N.Y., on Apr. 8 (text from press release 162).

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ship between rich nations and poor over the
last quarter of this century and beyond.

Today I want to speak to you about the
urgency of this issue. The law of the sea
negotiations now are at a critical stage. There
have been many successes, but they will prove
stillborn unless all the remaining issues are
settled soon. The United States believes that
if the present session does not complete its
work, another—and final—session should be
assembled this summer. If the negotiations
are not completed this year, the world will
have lost its best chance to achieve a treaty
in this generation.

I want to focus today upon the most im-
portant problems remaining before the con-
ference to speed their solution. I shall set
forth proposals which in our view can serve
as the basis for a widely accepted treaty.

The Importance of the Oceans

Most issues in international affairs im-
pinge on our consciousness in the form of
crisis, but many of the most important prob-
lems which crucially affect our future come
up to us far less dramatically. The world is
undergoing fundamental economic, techno-
logical, and social transformations which do
not dominate the daily headlines. Some of
them are even more profound in their con-
sequences than most immediate political
crises. In no area is this more true than the
oceans, a realm which covers 70 percent of
the earth's surface.

Freedom of the seas remains basic to the
security and well-being of most nations.
The seaborne commerce of the globe is ex-
pected to quadruple within a few decades.
The reliance of the world's people upon the
seas to carry food and energy is increasing.
Modern technology has enabled industries to
sweep the seas for fish and to probe the
oceans' floors for vital minerals and
resources. Mankind's growing dependence
on the seas, and the burgeoning world popu-
lation along their shores, are already bur-
dening the ecology of the oceans—a develop-
ment of potentially catastrophic significance,
for the oceans are the very source of life

as we know it, the characteristic distinguish-
ing our world from all other planets.

These developments have brought with
them a vast array of competitive practices
and claims, which—unless they are harmo-
nized—threaten an era of unrestrained com-
mercial rivalry, mounting political turmoil,
and eventually military conflict. We stand in
danger of repeating with respect to the
oceans the bitter rivalries that have pro-
duced endless conflict on land.

A cooperative international regime to
govern the use of the oceans and their
resources is therefore an urgent necessity.
It is, as well, an unprecedented opportunity
for the nations of the world to devise the
first truly global solution to a global prob-
lem. And the opportunity is all the greater
because we start with a clean slate.

Thus the multilateral effort to agree upon
a comprehensive treaty on the law of the
sea has implications beyond the technical
problems of the use of the oceans. It touches
upon basic issues underlying the long-term
stability and prosperity of our globe. The
current negotiation is a milestone in the
struggle to submit man's endeavors to the
constraints of international law.

Let us understand more precisely what
is at stake:

—In a world of growing scarcity, the
oceans hold untapped riches of minerals and
energy. For example, it is estimated that 40
percent of the world's petroleum and
virtually inexhaustible supplies of minerals
lie beneath the sea. Our economic growth
and technological progress will be greatly
affected by the uses made of these resources.

—In a world where the growth of popu-
lation threatens to overwhelm the earth's
capacity to produce food, the fish of the seas
are an increasingly precious—and endan-
gered—source of protein. The well-being and
indeed the very survival of future genera-
tions may well depend upon whether man-
kind can halt the present wanton depletion
of this vast storehouse of nutrition.

—In a world in which the health of the
planet our children will inherit depends upon

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decisions we make today, the environmental integrity of the oceans, which affects the quality of life everywhere, is vital.

—And in a world still buffeted by national conflicts, economic confrontation, and political strife, the free and fair use of the oceans is crucial to future peace and progress.

The oceans are not merely the repository of wealth and promise; they are, as well, the last completely untamed frontier of our planet. As such, their potential—for achievement or for strife—is vast.

In the 19th century, the Industrial Revolution gave birth to improved communications, technological innovations, and new forms of business organization which immeasurably expanded man's capacity to exploit the frontiers and territories of the entire globe. In less than one generation, one-fifth of the land area of the planet and one-tenth of its inhabitants were gathered into the domain of imperial powers in an unrestrained scramble for colonies. The costs—in affronts to human dignity, in material waste and deprivation, and in military conflict and political turbulence—haunt us still.

Like the non-Western lands of a century before, today it is the oceans which suddenly are accessible to new technology and alluring to exploration. Their promise may be even greater than the untapped lands of the century past. So, too, is their potential for conflict. The decision will be ours.

The international community now stands at the threshold of what can easily turn into a new period of unheralded competitive activity. It is our contention that the nations of the world cannot afford to indulge in another round of unrestrained struggle for the wealth of our planet when the globe is already burdened by ideological strife and thermonuclear weapons.

The United States could survive such competition better than other nations; and should it be necessary, we are prepared to defend our interests. Indeed, we could gain a great deal unilaterally in the near term. But we would do so in an environment of constant and mounting conflict. All nations, in-

cluding our own, ultimately would lose under such unpredictable and dangerous conditions.

That is not the kind of world we want to see. Our preference is to help build a rational and cooperative structure of international conduct to usher in a time of peace and progress for all peoples. We see the oceans as a trust which this generation holds —not only for all mankind but for future generations as well.

The legacy of history makes this a difficult task. For centuries, the songs and legends of peoples everywhere have seen the oceans as the very symbol of escape from boundaries, convention, and restraint. The oceans have beckoned mankind to rewards of wealth and power, which awaited those brave and imaginative enough to master the forces of nature.

In the modern era the international law of the sea has been dominated by a simple but fundamental principle: freedom of the seas. Beyond a narrow belt of territorial waters off the shores of coastal states, it has long been established and universally accepted that the seas were free to all for fishing and navigation.

Today the simple rules of the past are challenged. Pressure on available food, fuel, and other resources has heightened awareness of the ocean's potential. The reach of technology and modern communications has tempted nations to seek to exercise control over ocean areas to a degree unimagined in the past. Thus coastal states have begun to assert jurisdictional claims far out to sea. claims which unavoidably conflict with the established law and with the practices of others and which have brought a pattern of almost constant international conflict. Off the shores of nearly every continent, forces of coastal states challenge foreign fishing vessels: the "cod war" between Iceland and Great Britain, tuna boat seizures off South America, Soviet trawling off New England— these are but some examples.

It is evident that there is no alternative to chaos but a new global regime defining an agreed set of rules and procedures. The problem of the oceans is inherently inter-

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national. No unilateral or national solution is
likely to prevail without continual conflict.
The Law of the Sea Conference presents the
nations of the world with their choice and
their opportunity. Failure to agree is certain
to bring further, more intense confrontation,
as the nations of the world, now numbering
some 150, go all out to extend unilateral
claims.

* * *

The Deep Seabeds

The third, and the most complex and vital,
issue remaining before the conference is the
problem of the deep seabeds.

For decades we have known that the deep
seabeds contain great potential resources of
nickel, manganese, cobalt, and copper—
resources whose accessibility could contribute
significantly to global economic growth in the
future. It is only recently that the technology
has been developed which can enable us to
reach those deposits and extract them.

The conference has not yet approached
agreement on the issue of the deep seabeds,

because it has confronted serious philo-
sophical disagreements. Some have argued
that commercial exploitation unrestrained by
international treaty would be in the best in-
terests of the United States. In fact this
country is many years ahead of any other
in the technology of deep sea mining, and
we are in all respects prepared to protect
our interests. If the deep seabeds are not
subject to international agreement, the
United States can and will proceed to explore
and mine on its own.

But while such a course might bring us a
short-term advantage, it poses long-term
dangers. Eventually any one country's
technical skills are bound to be duplicated
by others. A race would then begin to carve
out deep sea domains for exploitation. This
cannot but escalate into economic warfare,
endanger the freedom of navigation, and
ultimately lead to tests of strength and mili-
tary confrontations.

America would not be true to itself, or to
its moral heritage, if it accepted a world in
which might makes right—where power alone
decides the clash of interests. And from a
practical standpoint, no one recognizes more
clearly than American industry that invest-
ment, access, and profit can best be protected

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n an established and predictable environment.

On the other hand, there are those who would place all the deep seabeds' resources under an international authority. Such a proposal would not provide adequate incentives and guarantees for those nations whose technological achievement and entrepreneurial boldness are required if the deep seabeds are to benefit all mankind. It would give control to those who do not have the resources to undertake deep seabed mining.

Let me briefly review the specific issues before us and then set forth the proposals which we believe can form the basis for a new consensus on the deep seabeds.

*First, the decisionmaking machinery for managing the deep seabeds.* There has been considerable debate over the form and the powers of the decisionmaking machinery established under the treaty. The United States is prepared to accept international machinery; but such machinery must be balanced and equitable and insure that the relative economic interests of the countries with important activities in the deep seabeds be protected, even though those countries may be a numerical minority.

*Second, access to the deep seabeds.* The conference has been struggling with the issue of which nations, which firms, and which international authorities will have direct access to, and share in the benefits from, the developing of deep seabed resources.

The United States understands the concern that the riches of the seas not be the exclusive preserve of only the most powerful and technologically advanced nations. We recognize that the world community should share in the benefits of deep seabed exploitation.

What the United States *cannot* accept is that the right of access to seabed minerals be given exclusively to an international authority or be so severely restricted as effectively to deny access to the firms of any individual nation including our own. We are gratified to note an increasing awareness of

the need to avoid such extreme positions and to move now to a genuine accommodation that would permit reasonable assurances to all states and their nationals that their access to these resources will not be denied.

*Third, the effect of seabed mining on land-based producers.* Land-based producers of seabed minerals are concerned that seabed production may adversely affect their national economies. This is an especially serious problem since many of these producers are poor, developing countries. We take these concerns seriously. But at the same time it must be recognized that commercial seabed production of these metals is at least five years away. For many years thereafter, seabed production will amount to only a fraction of total global production. Moreover, global metal markets are expanding and should easily be able to accommodate additional production from the seabeds without adversely affecting revenues of land-based producer countries.

The United States is prepared to make a major effort to resolve these issues equitably and to bring the Law of the Sea Conference to a swift and successful conclusion. In this spirit, the United States offers the following proposals:

*First, to insure an equitable decisionmaking system, the United States continues to believe that the treaty should authorize the formation of an *International Seabed Resource Authority* to supervise exploration and development of the deep seabeds. The Authority would be comprised of four principal organs: An Assembly of all member states, to give general policy guidance; a Council, to serve as the executive, policy-level, and main decisionmaking forum, setting operational and environmental rules for mining and supervising the contracts for deep seabed mining; a Tribunal, to resolve disputes through legal processes; and a Secretariat, to carry out the day-to-day administrative activities of the Authority.*

The United States proposes:

-That the power of the Authority be

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carefully detailed by the treaty in order to
preserve all those rights regarding the uses
of the seas which fall outside the com-
petence of the Authority, and to avoid any
jurisdictional overlap with other international
organizations.

—That the composition and structure of
the Council reflect the producer and consumer
interests of those states most concerned with
seabed mining. All nations whose vital
national economic concerns are affected by
decisions of the Authority must have a voice
and influence in the Council commensurate
with their interests.

—That the proposed permanent seabed
Tribunal adjudicate questions of interpreta-
tion of the treaty and of the powers of the
International Authority raised by parties to
the treaty or by private companies engaged
in seabed mining. Without a Tribunal, un-
resolved contention is a certainty. Such a
body will be necessary if any seabed proposal
is to win wide acceptance.

Second, to insure that all nations, developed
and developing, have adequate access to sea-
bed mining sites:

—The United States proposes that the treaty should guarantee nondiscriminatory access for states and their nationals to deep seabed resources under specified and reasonable conditions. The requirement of guaranteed access will not be met if the treaty contains arbitrary or restrictive limitations on the number of mine sites which any nation might exploit. And such restrictions are unnecessary because deep seabed mining cannot be monopolized; there are many more productive seabed mining sites than conceivably can be mined for centuries to come.

—The United States accepts that an "Enterprise" should be established as part of the International Seabed Resource Authority and given the right to exploit the deep seabeds under the same conditions as apply to all mining.

—The United States could accept as part
of an overall settlement a system in which
prime mining sites are reserved for exclusive
exploitation by the Enterprise or by the
developing countries directly—if this ap-

proach meets with broad support. Under
this system, each individual contractor would
propose two mine sites for exploitation. The
Authority would then select one of these
sites, which would be mined by the Authority
directly or made available to developing
countries at its discretion. The other site
would be mined by the contractor on his
own.

—The United States proposes that the
International Authority should supervise a
system of revenue sharing from mining
activities for the use of the international com-
munity, primarily for the needs of the poorest
countries. These revenues will not only
advance the growth of developing countries;
they will provide tangible evidence that a
fair share in global economic activity can be
achieved by a policy of cooperation. Revenue
sharing could be based either on royalties or
on a system of profit sharing from contract
mining. Such a system would give reality to
the designation of the deep seabeds as the
common heritage of all mankind.

—Finally, the United States is prepared to
make a major effort to enhance the skills
and access of developing countries to ad-
vanced deep seabed mining technology in
order to assist their capabilities in this field.
For example, incentives should be established
for private companies to participate in agree-
ments to share technology and train person-
nel from developing countries.

Third, in response to the legitimate con-
cerns of land-based producers of minerals
found in the deep seabeds, we offer the
following steps as an additional major con-
tribution to the negotiations:

—The United States is prepared to accept a
temporary limitation, for a period fixed in
the treaty, on production of the seabed
minerals tied to the projected growth in the
world nickel market, currently estimated to
be about 6 percent a year. This would in
effect limit production of other minerals con-
tained in deep seabed nodules, including cop-
per. After this period, the seabed production
should be governed by overall market con-
ditions.

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International Seabed Resource Authority have the right to participate in any international agreements on seabed-produced commodities in accordance with the amount of production for which it is directly responsible. The United States is prepared to examine with flexibility the details of arrangements concerning the relationships between the Authority and any eventual commodity agreements.

—The United States proposes that some of the revenues of the Authority be used for adjustment assistance and that the World Bank, regional development banks, and other international institutions assist countries to improve their competitiveness or diversify into other kinds of production if they are seriously injured by production from the deep seabeds. An urgent task of the International Authority, when it is established, will be to devise an adjustment assistance program in collaboration with other international institutions for countries which suffer economic dislocations as a result of deep seabed mining.

These proposals on the issue of deep seabed resources are offered in the spirit of cooperation and compromise that characterized our economic proposals at the seventh special session and that guides our policies toward the developing nations. The United States is examining a range of commodity problems and ways in which they might be fairly resolved. We intend to play an active role at the U.N. Conference on Trade and Development next month in Nairobi and come forward with specific proposals. We look toward a constructive dialogue in the Raw Materials Commission of the Conference on International Economic Cooperation in Paris. And we are actively committed to producer-consumer forums to discuss individual commodities—such as the recent forum on copper.

The United States believes that the world community has before it a grave responsibility. Our country cannot delay in its efforts to develop an assured supply of critical resources through our deep seabed mining projects. We strongly prefer an international

agreement to provide a stable legal environment before such development begins, one that insures that all resources are managed for the good of the global community and that all can participate. But if agreement is not reached this year, it will be increasingly difficult to resist pressure to proceed unilaterally. An agreement on the deep seabed can turn the world's interdependence from a slogan into a reality. A sense of community which nations have striven to achieve on land for centuries could be realized in a regime for the oceans.

## The Possibility and the Promise

The nations of the world now have before them a rare, if not unique, opportunity. If we can look beyond the pressures and the politics of today to envision the requirements of a better tomorrow, then we can understand the true meaning of the task before us.

Let us pause to realize what this treaty can mean—to this generation and to the possible realization of humanity's dream of a progressive ascent toward justice and a good life for all peoples.

If the conference is successful, mankind's rights and responsibilities with regard to the oceans will be clear to all.

This will mean freedom of navigation, preserving the rights of all on the seas.

It will mean a greater flourishing of trade and commerce, bringing the benefits of a freer flow of goods to consumers and producers alike.

It will mean that the oceans, recognized as "the source of all" since Homer's day, can continue to enrich and support our planet's environment.

It will mean that there will be a comprehensive regime for all of the world's oceans embracing not only territorial waters but a new economic zone, the continental margin, and the deep seabeds.

It will mean the realization of the promise of scientific research in the oceans—the further probing of the mysteries of our planet to better the lives and preserve the health of all.

It will mean that the seas' resources of

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nutrition and raw materials can be tapped for the use of the entire human community.

It will mean that an arena of conflict, and one which is becoming increasingly dangerous, will become an area for cooperative progress.

It will mean that the entire international community—the developing as well as developed, landlocked as well as coastal—will share in the uses, the nourishment, the material resources, and the revenues which this great treaty could provide. For the poorer countries in particular, it will mean revenues from the continental margin and the deep seabeds, and the opportunity to participate in deep sea mining through an international organization.

And above all, it will mean the nations of the world have proved that the challenges of the future can be solved cooperatively: that for the first time mankind has been able to surmount traditional enmities and ambitions in the service of a better vision.

These, then, are the stakes; these are the possibilities we hold in our grasp. Will we have the maturity and the judgment to go forward? Will we fulfill the obligation which future historians—without question—will assign to us? I believe we shall. The United States is determined that we shall. The possibility and the promise have never been more clear. Through reason, through responsibility, and by working together, we shall succeed.

With hindsight it is easy to identify the moments in history when humanity broke from old ways and moved in new directions.

But for those living through such times, it is usually difficult to see the true significance even of epoch-making events.

That is why the nations who are engaged in the Law of the Sea Conference have come to a unique moment in history. Only rarely does mankind comprehend the significance of change in the world as we so clearly do today. We share a common perception of:

- The need to contain potential conflict;

- The importance of cooperative solutions to shared problems; and

- The necessity to achieve the full and fair use of the possibilities of our planet, both material and moral.

If a second session is necessary this year to complete the work of the conference, let us make that session the final one. To underline the importance the President attaches to these negotiations, he has asked me to lead the U.S. delegation to that session. It is our hope that other nations will attach similarly high importance to it and be prepared to discuss the remaining issues before us at a decisive political level. This should be a time for determined action, a time to avoid rhetoric and to commit ourselves to decisions and a final agreement.

The United States calls upon all nations deliberating this great treaty to summon the sense of responsibility and urgency which history and this task demand of us. For our part, the United States pledges to work tirelessly to seize this rare chance for decisive progress on one of the great challenges of our time.

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## Nonalignment

In his speeches about the UN or about relations with the Third World, HK had complained about the "bloc of the nonaligned." In a speech in New Delhi before the Indian Council on World Affairs on October 28, 1974 (#19), HK spoke more positively about our acceptance of genuine nonalignment. A world of free, independent sovereign states was decidedly in America's own interest. He made another call for a recognition of global interdependence:

The fundamental reality of our age is that we live in a world inextricably linked by interdependent economies and universal aspirations, by the speed of communications and the specter of nuclear war. The political lesson of our age is that the national interest can no longer be defined or attained in isolation from the global interest, and the moral challenge of our age is to free ourselves from the narrow perception of the nation-state and to shape a conception of global community.

The three years since I was last in New Delhi have seen profound changes in the relationship between India and the United States, in the whole region, and in the world.

On my last trip to South Asia I paid my first visit to Peking. On this trip I have visited Moscow. Moving about among capitals only recently considered hostile is a new pattern for the United States. It signified the transition from a bipolar world locked in confrontation and seemingly destined for some final encounter to the new world of dispersed power and reduced tension.

This changed environment is more complex and therefore, for some, less assuring. Yet we see it as a world of hope. For the process of détente among major powers has not made the world more complex; it merely sig-

nifies that leaders have recognized its complexity. Those who ought always to have known how serious is man's predicament have learned how little benefit confrontation brings and how absolute is the need for cooperation.

This has not been an effortless transition for the American people. Nor is it without difficulties in other nations of the world, for it requires coming to terms with less simple views of right and wrong, of the possible and the ideal, than have permeated political thinking for a generation.

This new American view, it is appropriate to acknowledge, owes much to an old vision of India's national leaders. Jawaharlal Nehru perceived the impermanence of the postwar world—into which India was born—of frozen hostility between the superpowers and their insistent efforts to enlist other nations on one side or the other. Under Nehru and since India sought to deflect, to moderate, and to redirect those forces. This was the origin of the concept of nonalignment.

It is not necessary to debate now whether the United States should have welcomed the concept at that time in order to agree that in the present world it is for nations such as India an altogether understandable and practical position. The United States accepts

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nonalignment. In fact, America sees a world of free, independent, sovereign states as being decidedly in its own national interest. Support of national independence and of the diversity that goes with it has become a central theme of American foreign policy.

Nowhere is this clearer than with respect to South Asia, where a fifth of mankind lives. In testimony before the U.S. Senate Foreign Relations Committee six weeks ago, I stated this principle of American foreign policy in explicit terms:

> We do not look at the subcontinent as being composed of some countries that are clients of China, others that are clients of the Soviet Union, others that should be clients of the United States. We believe that we can have productive relationships with all of them. And we believe also, specifically with respect to India, that our relations are in a stage of dramatic improvement.

The warming of our bilateral relations has been increasingly manifest for some time. It began inevitably as the Simla process began, and it has proceeded and strengthened as that process has proceeded and strengthened. For it was conflict within the subcontinent that brought the involvement of outsiders in the first place. And correspondingly, the region's political capacity to resolve regional conflict has, to a considerable degree, diminished outside involvement. President Ford has asked me to affirm that the United States strongly supports the efforts of peaceful settlement on the subcontinent, free of imposition or pressure or outside interference. We want political stability and economic success for South Asia. That is what we believe South Asians hope for and what the rest of the world should hope for as well.

The statesmanship of all of South Asia's leaders has been at the heart of this process. It has taken great courage to persevere toward the goal agreed upon by Pakistan and India at the Simla Conference in 1972: "The promotion of a friendly and harmonious relationship and the establishment of a durable peace in the Subcontinent."

The size and position of India give it a special role of leadership in South Asian and world affairs. They confer on it at the

same time the special responsibility for accommodation and restraint that strength entails. The United States recognizes both these realities. They are wholly compatible with the close friendships and special bonds we have with all the nations of the region. As we wish South Asia well, we wish India well.

Thus a more mature and durable relationship is emerging between India and the United States—one which leaves behind the peaks and valleys of the past.

Both India and the United States still consider themselves youthful nations. The restlessness, the striving, and the ideals of our people attest to the reality of that image. But a basic quality of youth—enthusiasm unseasoned by experience—often caused us to assume or expect too much. We are two great nations of independent judgment and perspective; often our zeal and moral convictions have led us into disagreements with a passion that might not have been present had we not been conscious of similar ideals.

For a quarter of a century our relations tended to oscillate between high expectation and deep suspicion. The low point occurred in 1971 when a basic disagreement flowed from different political judgments. We faced these differences candidly; that crisis is now behind us. We have surmounted past strains and moved ahead with promise. We can now build our relationship free of past distortions and conscious of the interests and values we share.

From the events of the past—from our experience with the world as well as yours—we have both developed a more balanced view. Both of us independently have come to temper our zeal and understand limitations on our ability to bend the world to our expectations. In parallel with this, in our relations with each other we both stress the basic compatibility of our interests. This promises to provide a durable basis for cooperation and friendship.

For our new relationship to thrive, a great deal depends on our mutual understanding. Nations face different problems and different opportunities; their perspectives and power inevitably vary. Let me therefore briefly

741

sketch America's broader purposes, especial-
ly as they have evolved in recent years in a
changing international environment.

America's Purposes

Around the world today, the new and the old coexist in uneasy equilibrium. The frozen international landscape of the past quarter century has begun to thaw, but we have yet to put a durable structure of cooperation in its place. A new era of stability has begun in Europe and Asia, while chronic disputes in the Middle East and Indochina still endanger regional and global peace. The United States and the Soviet Union have perceived a common interest in avoiding nuclear holocaust, while some potential for conflict persists and the arsenals of the two sides continue to grow. The United States and the People's Republic of China have succeeded in overcoming two decades of estrangement, but important differences in philosophy remain. And as the old blocs among old powers decline, new blocs among new nations threaten to emerge.

The United States sees its central task today as helping the world to shape a new pattern of stability, justice, and international cooperation. We have rejected the old extremes of world policeman and isolation. But we recognize that America's principles, strength, and resources impose upon us a special responsibility.

Our goal is to move toward a world where
blocs and balances are not dominant; where
justice, not stability, can be our overriding
preoccupation; where countries consider co-
operation in the global interest to be in their
national interest. For all that has been
achieved, we must realize that we have taken
only the first hesitant steps on a long and
arduous road.

The United States has three principal
policy objectives.

First, America has sought to foster a new
spirit of responsibility and restraint among
all powers.

The cornerstone of our foreign policy is—
as it has been for a generation—our partner-
ship with our Atlantic allies and Japan. These

bonds have served both the world's peace
and its prosperity. Our cooperation pro-
vided a solid foundation for efforts to reduce
tensions with our adversaries. It has en-
abled us to contribute to world economic
growth. And the nations which provide the
industrial, financial, and technological sinews
of the global economy now share a heavy
collective responsibility to concert their ef-
forts in a time of global economic stress.

In the last five years the United States
has also sought to put its relations with the
Communist powers on a new and steady
basis.

Since the dawn of the nuclear age, man's
fears of holocaust and his hopes for peace
have turned on the relationship between the
United States and the Soviet Union. Never
before have two nations had the physical
ability to annihilate civilization. Never be-
fore has it been so important that the two
nuclear giants maintain close contact with
one another to avoid conflicts which would
menace other nations as much as themselves.

Progress has been achieved in our rela-
tionship with the Soviet Union which would
have been unthinkable a decade ago. We
take the easing of tensions for granted only
at the risk of the return of confrontation. In
my discussions in Moscow I stated yet again
the determination of the American Govern-
ment to maintain the momentum of the
process of détente and was assured by the
Soviet leaders that they shared this inten-
tion. The United States will persevere to
reduce military competition with the Soviet
Union in all its aspects; to insure that our
political competition is guided by principles
of restraint, especially in moments of crisis;
and to move beyond restraint to cooperation
in helping find lasting solutions to chronic
conflicts.

America's relations with the People's Re-
public of China are also of fundamental im-
portance. There cannot be a stable peace in
Asia—or in the world—without a pattern
of peaceful international relationships that
includes this powerful and talented nation.
It was essential to end a generation of mu-
tual isolation and hostility.

Yet rapprochement with the People's Re-

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249

public of China is not sought at the expense
of any other nations; on the contrary, it
attempts to serve a wider purpose. The
principles of the Shanghai communique
commit our two nations to respect the inde-
pendence, sovereignty, and integrity of all
countries as we work to improve our own
relationships.

Our relations with the nonaligned coun-
tries are another pillar of our foreign policy.
No accommodation among countries, how-
ever powerful, can be durable if negotiated
over the heads of others or if an attempt
is made to impose it on others. Our attitude
toward the nonaligned will be based on the
principles of equality, mutual respect, and
shared endeavors and on the premise that
all countries have a stake in a peaceful
world. Condominium, hegemony, spheres of
influence, are historically obsolete and moral-
ly and politically untenable.

It is a corollary of this, however, that
bloc diplomacy of any kind is anachronistic
and self-defeating. We see a danger of new
patterns of alignment that are as artificial,
rigid, and ritualistic as the old ones. The
issues the world faces are so urgent that
they must be considered on their merits, on
the basis of their implications for humanity
and for world peace—rather than on some
abstract notion of ideological or bloc advan-
tage. In a real sense the world is no longer
divided between East and West, North and
South, developed and developing, consumer
and producer. We will solve our problems to-
gether, or we will not solve them at all.

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## Nuclear Nonproliferation

Another theme of HK's speeches on Third World subjects was American efforts to control the proliferation of nuclear weapons and nuclear weapons technology. As described in HK's speech to the UN General Assembly on September 23, 1974 (# 17), it was one of the themes of global interdependence: mankind was facing a stark question: "Will our age of interdependence spur joint progress or common disaster?" It was a problem that became acute in 1974 in the wake of the Indian nuclear explosion. HK outlined the American approach to the problem, which included some new initiatives:

Last year, in my first address as Secretary of State, I spoke to this Assembly about American purposes. I said that the United States seeks a comprehensive, institutionalized peace, not an armistice. I asked other nations to join us in moving the world from détente to cooperation, from coexistence to community.

In the year that has passed, some progress has been made in dealing with particular crises. But many fundamental issues persist, and new issues threaten the very structure of world stability.

Our deepest problem—going far beyond the items on our agenda—is whether our vision can keep pace with our challenges. Will history recall the 20th century as a time of mounting global conflict or as the beginning of a global conception? Will our age of interdependence spur joint progress or common disaster?

The answer is not yet clear. New realities have not yet overcome old patterns of thought and action. Traditional concepts—of national sovereignty, social struggle, and the relation between the old and the new nations—too often guide our course. And so we have managed but not advanced; we have endured but not prospered; and we have continued the luxury of political contention.

This condition has been dramatized in the brief period since last fall's regular session. War has ravaged the Middle East and Cyprus. The technology of nuclear explosives has resumed its dangerous spread. Inflation and the threat of global decline hang over the economies of rich and poor alike.

> We cannot permit this trend to continue. Conflict between nations once devastated continues; the struggle between blocs may destroy humanity. Ideologies and doctrines drawn from the last century do not even address, let alone solve, the unprecedented problems of today. As a result, events challenge habits; a gulf grows between rhetoric and reality.

> The world has dealt with nuclear weapons as if restraint were automatic. Their very awesomeness has chained these weapons for almost three decades; their sophistication and expense have helped to keep constant for a decade the number of states who possess them. Now, as was quite foreseeable, political inhibitions are in danger of crumbling. Nuclear catastrophe looms more plausible—whether through design or miscalculation; accident, theft, or blackmail.

## The Nuclear Dimension

The second new dimension on our agenda concerns the problem of nuclear proliferation.

The world has grown so accustomed to the existence of nuclear weapons that it assumes they will never be used. But today, technology is rapidly expanding the number of nuclear weapons in the hands of major powers and threatens to put nuclear-explosive technology at the disposal of an increasing number of other countries.

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In a world where many nations possess nuclear weapons, dangers would be vastly compounded. It would be infinitely more difficult, if not impossible, to maintain stability among a large number of nuclear powers. Local wars would take on a new dimension. Nuclear weapons would be introduced into regions where political conflict remains intense and the parties consider their vital interests overwhelmingly involved. There would, as well, be a vastly heightened risk of direct involvement of the major nuclear powers.

This problem does not concern one country, one region, or one bloc alone. No nation can be indifferent to the spread of nuclear technology; every nation's security is directly affected.

The challenge before the world is to realize the peaceful benefits of nuclear technology without contributing to the growth of nuclear weapons or to the number of states possessing them.

As a major nuclear power, the United States recognizes its special responsibility. We realize that we cannot expect others to show restraint if we do not ourselves practice restraint. Together with the Soviet Union we are seeking to negotiate new quantitative and qualitative limitations on strategic arms. Last week our delegations reconvened in Geneva, and we intend to pursue these negotiations with the seriousness of purpose they deserve. The United States has no higher priority than controlling and reducing the levels of nuclear arms.

Beyond the relations of the nuclear powers to each other lies the need to curb the spread of nuclear explosives. We must take into account that plutonium is an essential ingredient of nuclear explosives and that in the immediate future the amount of plutonium generated by peaceful nuclear reactors will be multiplied many times. Heretofore the United States and a number of other countries have widely supplied nuclear fuels and other nuclear materials in order to promote the use of nuclear energy for peaceful purposes. This policy cannot continue if it leads to the pro-

liferation of nuclear explosives. Sales of these materials can no longer be treated by anyone as a purely commercial competitive enterprise.

The world community therefore must work urgently toward a system of effective international safeguards against the diversion of plutonium or its byproducts. The United States is prepared to join with others in a comprehensive effort.

Let us together agree on the practical steps which must be taken to assure the benefits of nuclear energy free of its terrors:

- The United States will shortly offer specific proposals to strengthen safeguards to the other principal supplier countries.

- We shall intensify our efforts to gain the broadest possible acceptance of International Atomic Energy Agency (IAEA) safeguards, to establish practical controls on the transfer of nuclear materials, and to insure the effectiveness of these procedures.

- The United States will urge the IAEA to draft an international convention for enhancing physical security against theft or diversion of nuclear material. Such a convention should set forth specific standards and techniques for protecting materials while in use, storage, and transfer.

- The Treaty on the Non-Proliferation of Nuclear Weapons, which this Assembly has endorsed, warrants continuing support. The treaty contains not only a broad commitment to limit the spread of nuclear explosives but specific obligations to accept and implement IAEA safeguards and to control the transfer of nuclear materials.

Mr. President, whatever advantages seem to accrue from the acquisition of nuclear-explosive technology will prove to be ephemeral. When Pandora's box has been opened, no country will be the beneficiary and all mankind will have lost. This is not inevitable. If we act decisively now, we can still control the future.

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HK even raised the topic of nuclear nonproliferation in New Delhi, in his address on October 28, 1974, before the Indian Council on World Affairs (# 19). The United States, he told his Indian audience, was itself negotiating with the Soviet Union in SALT and offering to restrict nuclear exports; the US was therefore not asking others for restraints which it was not prepared to apply to itself.

## Limiting the Dangers of the Atom

Second, America seeks to limit and ultimately to reduce nuclear weapons competition.

The relaxation of international tensions cannot survive an unrestrained arms race by the two strongest nuclear powers. And international stability will be seriously jeopardized by the proliferation of nuclear weapons. This is why the United States has made it a major objective to bring about a more stable nuclear environment.

The Strategic Arms Limitations Talks are among the most crucial negotiations ever conducted. The agreements already signed by the United States and the Soviet Union represent a major step toward strategic stability. They placed a permanent limit on defensive weapons and an interim limit on offensive nuclear weapons. Our task now is to control the qualitative as well as quantitative advance of weapons. We seek a long-term agreement which would establish stable ceilings and other restraints, from which we could begin the long-sought process of arms reductions. Progress in this direction was made during my recent talks in Moscow.

At the same time, a world in which an ever-increasing number of nations possess nuclear weapons vastly magnifies the risks of both regional and global conflict. And proliferation complicates—if it does not inhibit—international cooperation in the peaceful uses of the atom.

Last month at the United Nations I proposed a comprehensive global effort: The United States is of the view that countries capable of exporting nuclear technology should agree to common restraints on a multilateral basis which would further the peaceful, but inhibit the military, uses of nuclear power.

We take seriously India's affirmation that it has no intention to develop nuclear weapons. But India of course has the capability to export nuclear technology; it therefore has an important role in this multilateral endeavor.

Needless to say, the United States does not ask other countries for restraint on the export of nuclear materials and technology which it is not prepared to apply to itself. We will work vigorously with others on the practical steps which should be taken to limit the dangers of the atom while furthering its potential for human good.

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At the UNGA on September 22, 1975 (# 42), HK reiterated the American commitment to achieve some international control over the spread of nuclear weapons technology, even as we sought to foster peaceful uses of nuclear power in an era of energy scarcity:

The world faces a paradox with respect to the proliferation of nuclear energy. Men have fashioned from the atom weapons which can in minutes end the civilization of centuries. Simultaneously, the atom is fast becoming a more and more essential source of energy. It is clear that the cost and eventual scarcity of oil and other fossil fuel will increasingly spread nuclear power around the world in the decades ahead.

But the spreading of nuclear power poses starkly the danger of proliferating nuclear weapons capabilities—and the related risks of the theft of nuclear materials, blackmail by terrorists, accidents, or the injection of the nuclear threat into regional political conflicts. Now is the time to act. If we fail to restrain nuclear proliferation, future generations will live on a planet shadowed by nuclear catastrophe.

Over the past year, the United States has repeatedly urged new efforts among the supplier states to strengthen and standardize safeguards and controls on export of nuclear materials. We must not allow these safeguards to be eroded by commercial competition. We must insure the broad availability of peaceful nuclear energy under safe, economical, and reliable conditions.

The United States has intensified its efforts

within the International Atomic Energy Agency (IAEA) and with other nations to broaden and strengthen international standards and safeguards and has proposed an international convention setting standards to protect the physical security of nuclear materials in use, storage, or transfer.

The United States continues to urge the widest possible adherence to the Nonproliferation Treaty and the associated safeguard measures of the IAEA.

The greatest single danger of unrestrained nuclear proliferation resides in the spread under national control of reprocessing facilities for the atomic materials in nuclear power plants. The United States therefore proposes—as a major step to reinforce all other measures—the establishment of multinational regional nuclear fuel cycle centers. These centers would serve energy needs on a commercially sound basis and encourage regional energy cooperation. Their existence would reduce the incentive for small and inefficient reprocessing facilities, limit the possibility of diverting peaceful nuclear materials to national military use, and create a better framework for applying effective international safeguards.

We urge that groups of nations begin now to explore this concept and that all states support the IAEA's work in this field.

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A more extensive and detailed presentation of US policy on nonproliferation was made before the Senate Committee on Government Operations on March 9, 1976 (# 53). Nonproliferation had long been a US objective, but the problem had become particularly acute in 1973-74 in the wake of the energy crisis and the Indian nuclear explosion. The United States had devised a comprehensive strategy for addressing the problem, involving both multilateral and national action. At the same time, HK at the end made the important point that nonproliferation could only be addressed in its political context: The incentive to acquire nuclear weapons could only be reduced in a climate of international security, cooperation, and peaceful resolution of disputes:

## Nonproliferation Perspectives

Nonproliferation has been a primary foreign policy goal of the United States through six Administrations, with major accomplishments stemming from U.S. initiatives demonstrating the seriousness with which this policy has been pursued. I cite, for example, the adoption of bilateral safeguards and controls in our government-to-government cooperative agreements, the establishment of the International Atomic Energy Agency (IAEA) in Vienna, and the entering into force of the nuclear Nonproliferation Treaty. As a result of these steps, the number of nuclear-weapon states has been substantially limited.

After I assumed the office of Secretary of State, however, it became apparent that changing circumstances warranted a new look at our nonproliferation strategy:

> —Other industrialized states were entering the international nuclear market, thereby challenging our longstanding dominance as a commercial nuclear exporter and threatening to diminish the ultimate effect of our national safeguards and control policies.

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—The oil crisis has stimulated many developing as well as developed states to accelerate their peaceful nuclear power programs, both as a means of lowering the cost of generating electrical energy and reducing their reliance on imported petroleum products.

—The nuclear test by India underscored the fact that additional states, even those not part of the highly industrialized world, were capable of using nuclear technology to construct explosives.

In my speech to the U.N. General Assembly in September of 1974, I underscored our concerns over the rapid spread of nuclear technology with potential explosive implications. I chose this forum to address the pressing problem of proliferation since it is clear that the danger of further nuclear-explosive spread is a problem vital to every nation on this planet. At that time, I warned against complacency by observing that:

> The world has grown so accustomed to the existence of nuclear weapons that it assumes they will never be used. But today, technology is rapidly expanding the number of nuclear weapons in the hands of major powers and threatens to put nuclear-explosive technology at the disposal of an increasing number of other countries.

Let me emphasize that pursuit of a vigorous nonproliferation strategy remains a fundamental dimension of this Administration's overall foreign policy:

—We see the need to reduce the danger of nuclear war as the centerpiece of our policy. If additional states acquired nuclear weapons, global stability would be endangered, and regional conflicts would run the risk of leading to nuclear war, with potentially catastrophic consequences not only for the nations involved but for all major powers.

—We view the peaceful settlement of regional conflicts and a more stable world order as crucial U.S. objectives. Yet a world of many nuclear powers would result in heightened political tensions and increased instabilities flowing from fears that nuclear weapons might be used, whether

deliberately or through miscalculation.

—We support the worldwide goal of finding alternative sources of energy to reduce reliance on oil. Yet a progressive pattern of proliferation could set back, if not cripple entirely, the continued growth of peaceful nuclear energy to serve mankind's needs, as exporters and importers alike came to lose confidence in the ability of the international system to find effective techniques for realizing the peaceful benefits of nuclear energy while eliminating its inherent security risks.

To meet these new dangers, I emphasized in my 1974 U.N. General Assembly speech —and again a year later before the same forum—the importance the United States attaches to nonproliferation. In both addresses, I outlined practical steps we saw as necessary to move forward effectively and comprehensively in this vital field. These included proposals for the major suppliers to strengthen nuclear safeguards; efforts to gain the widest possible support for the international safeguard system and the Nonproliferation Treaty; physical security measures to protect nuclear material against theft or diversion; and steps to prevent the unrestrained spread of sensitive nuclear facilities, such as national reprocessing plants.

I am pleased to take this opportunity to report to this committee on the progress we have made and the problems we still face. There have been solid accomplishments to date, and I will go into the details of these successes in a few moments. But we are far from complacent, and even as we consolidate our gains, we seek to strengthen our nonproliferation strategy.

I do not have to tell this committee how difficult it is to devise a strategy that can guarantee success in preventing the number of nuclear-weapon states from increasing during the coming decades. But I cannot emphasize too strongly our belief that the effort can and must be made to contain nuclear spread, even if we cannot be certain of completely and effectively blocking additional nuclear proliferation.

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It is within the foregoing framework that we have mounted a major effort during the past two years to strengthen the worldwide nonproliferation regime. This strategy has had two reinforcing elements:

- Multilateral actions to move forward with other states in meeting the nonproliferation challenge; and

- National nuclear export policies to ensure that the United States continues to exert responsible leadership in nonproliferation.

Let me now describe in some detail the key elements of our nonproliferation strategy, what has been accomplished during the past two years, and what needs to be done to further advance our position.

Perhaps most fundamentally, we recognize that proliferation is not a problem to be addressed solely through the technical and legal framework of safeguards and export controls—vital as these avenues may be. There is a direct link, as I have stressed, between our efforts in nonproliferation and our broader efforts to construct a more secure international climate.

If countries remain convinced that regional and global tensions can be reduced through cooperation, that disputes can be resolved in a peaceful manner, and that their legitimate security requirements can be met, there will be no need for them to develop nuclear weapons.

To be successful in our nonproliferation endeavors, we must sustain and build upon the multilateral and national policy foundations we have established. As I indicated earlier, this requires constant attention to consultations with other nuclear suppliers, peaceful nuclear cooperation with recipients, and constructive support for international mechanisms which can lend permanence to our nonproliferation policies.

This task warrants the most vigorous U.S. and international efforts. We hope to work constructively with the Congress in continuing to develop and implement a balanced U.S. nonproliferation strategy—balanced in the need to maintain our influence through prudent and reliable national export policies, the importance of pursuing a multilateral as well as a national approach, and the recognition that our overall foreign objectives can reinforce our nonproliferation goals as we work to create a more stable world order.

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## V. THE NEED FOR NATIONAL UNITY
### Executive-Legislative Relations

One of the fundamental themes of HK's speeches throughout his tenure as Secretary of State was the need for national unity. It was a key element, for example, in his confirmation statement prepared for the Senate Foreign Relations Committee on September 7, 1973 (#1). Here, the focus was on the need for more cooperative executive-legislative relations. This reflected the hope that, with the Vietnam controversies behind us and HK now accessible to Congressional committees, the tensions between Congress and the Executive would be eased in the new period. HK hoped for a spirit of bipartisanship and for a recovery of the natural optimism and self-confidence that used to mark the American people's attitude to foreign involvement. Unfortunately, Watergate had by then intruded. HK hoped that the relationship between the Secretary of State and the SFRC could insulate foreign policy to some degree from the rot of Watergate:

> Mr. Chairman, we have come to experience in recent years that peace at home and peace abroad are closely related. How well we perform in foreign policy depends importantly on how purposeful we are at home. America has passed through a decade of domestic turbulence which has deepened divisions and even shaken our national self-confidence in some measure. At the same time, profound changes have occurred in the world around us, a generation after World War II. Our era is marked by both the anxieties of a transitional period and the opportunities of fresh creation.

These challenges, though they appear as practical issues, cannot be solved in technical terms; they closely reflect our view of ourselves. They require a sense of identity and purpose as much as a sense of policy. Throughout our history we have thought of what we did as growing out of deeper moral values. America was not true to itself unless it had a meaning beyond itself. In this spiritual sense, America was never isolationist.

This must remain our attitude.

This is why our international policies must enlist the contributions of our best people regardless of political persuasion. Our task is to define -- together -- the contours of a new world, and to shape America's contribution to it. Our foreign policy cannot be effective if it reflects only the sporadic and esoteric initiatives of a small group of specialists. It must rest on a broad national base and reflect a shared community of values.

***

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This will require mutual effort and mutual understanding. We will
do our part. The President has charged me with helping him to shape
a foreign policy that can endure because it is carried in the hearts as
well as the minds of Americans.

There must be, as well, a closer relationship between the Executive
and Legislative branches. It is the President's objective to make policy
more accessible to the scrutiny and the views of the Congress. This
is the fundamental answer to the question of executive privilege. As
you gentlemen know, over an extended period of time when I was fully
covered by this principle, I met regularly with the members of this
Committee, both individually and as a group, and most frequently with
the Chairman. I did so partly because I valued this association on
personal grounds, but also because of my conviction that this nation
faced no more urgent requirement than to promote mutual respect
where a consensus was unattainable.

This prompts the question, what do we mean by bipartisanship? We
do not ask for rubber stamping and we cannot expect unanimity. Serious
people obviously will continue to have differences. Where profound
disagreements exist, it would be self-defeating to paper them over with
empty formulae. We in turn cannot give up basic principles, nor can
we promise to act only when there is bipartisan agreement, though this
will be our preference. But we shall work to shape a broad consensus
on our national goals and to confine differences to tactical issues. When
our views differ, we shall strive not to press the debate to a point that
tears the overall fabric of the national consensus. We will seek to
maintain a climate of mutual trust so that arguments can center
on methods, not motives. We hope that this restraint will be mutual.
In this manner, our foreign policy debate can avoid the extremes of
civil war and sterile accord for its own sake.

If our foreign policy is to be truly national, we must deepen our
partnership with the American people. This means an open articulation
of our philosophy, our purposes, and our actions. We have sought to
do this in the President's Annual Reports to the Congress on foreign
policy. Equally, we must listen to the hopes and aspirations of our
fellow countrymen. I plan, therefore, on a regular basis, to elicit
the views of America's opinion leaders and to share our perspectives
freely.

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Mr. Chairman, I have sketched an agenda for seeking a more durable peace abroad and a cooperative climate at home. Both objectives point to the urgent need for reconciliation. Americans have recently endured the turmoil of assassinations and riots, racial and generational confrontations, and a bitter, costly war. Just as we were emerging from that conflict, we were plunged into still another ordeal.

These traumatic events have cast lengthening shadows on our traditional optimism and self-esteem. A loss of confidence in our own country would inevitably be mirrored in our international relations. Where once we ran the risk of thinking we were too good for the world, we might now swing to believing we are not good enough. Where once a soaring optimism tempted us to dare too much, a shrinking spirit could lead us to attempt too little. Such an attitude -- and the foreign policy it would produce -- would deal a savage blow to global stability.

But I am hopeful about our prospects. America is resilient. The dynamism of this country is irrepressible. Whatever our divisions, we can rally to the prospects of building a world at peace and responsive to humane aspirations. In so doing, we can replenish our reservoir of faith.

The "other ordeal" referred to was, of course, Watergate, which by September 1973 had already reached serious proportions. Executive-legislative relations did improve, however, with HK as Secretary of State and J. William Fulbright as Chairman of the SFRC, and with Vietnam replaced by the Middle East as the major foreign policy issue.

When Gerald Ford replaced Richard Nixon as President, there was hope for a major improvement in the domestic context of foreign policy. HK made another appeal for both national self-confidence and national unity in his remarks to the annual dinner of the Alfred E. Smith Memorial Foundation in New York, on October 16, 1974 (#18):

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Los Angeles Speech
Jan. 24, 1975

(excerpt)

## The Need for National Unity

The agenda of war and peace, fuel and food, places a great responsibility upon America. The urgency of our challenges, the magnitude of the effort required, and the impact which our actions will have on our entire society all require an exceptional degree of public understanding and the effective participation and support of Congress.

Our foreign policy has been most effective when it reflected broad nonpartisan support. Close collaboration between the executive and legislative branches insured the success of the historic postwar American initiatives and sustained our foreign policy for two decades thereafter. More recently, during the harrowing time of Watergate, the spirit of responsible bipartisanship insulated our foreign policy from the trauma of domestic institutional crisis. For this, the nation owes the Congress a profound debt of gratitude.

A spirit of nonpartisan cooperation is even more essential today. The bitterness that has marked so much of our national dialogue for over a decade no longer has reason or place. Public debate once again must find its ultimate limit in a general recognition that we are engaged in a common enterprise.

To appeal for renewed nonpartisan cooperation in foreign policy reflects not a preference but a national necessity. Foreign nations must deal with our government as an entity, not as a complex of divided institutions. They must be able to count on our maintaining both our national will and our specific undertakings. If they misjudge either, they may be tempted into irresponsibility or grow reluctant to link their destiny

to ours. If our divisions lead to a failure of policy, it is the country which will suffer, not one group or one party or one administration. If our cooperation promotes success, it is the nation which will benefit.

In his first address to Congress, President Ford pledged his administration to the principle of communication, conciliation, compromise, and cooperation. In that spirit, and on behalf of the President, I invite the Congress to a new national partnership in the conduct of our foreign policy. Together with new conceptions of foreign policy, we must define new principles of executive-legislative relations—principles which reconcile the unmistakable claims of congressional supervision and the urgent requirements of purposeful American world leadership.

The administration will make every effort to meet congressional concerns. We will dedicate ourselves to strengthening the mutual sense of trust with the Congress. We do not ask for a blank check. We take seriously the view that over the past decade there often has been a breakdown of communication between the executive and legislative branches.

We have made major efforts to consult the Congress and to keep it informed. As Secretary of State, confirmed by the Senate, I have considered this a principal responsibility of my office. Therefore, in less than 16 months in office, I have testified 37 times before congressional committees and have consulted even more frequently with individual Members and groups.

Nevertheless, we recognize that a new partnership requires a willingness to explore new approaches. Specifically, the administration will strive to evoke the advice and consent of the Congress in its broadest sense. We know that congressional support presupposes that both Houses are kept informed of the administration's premises and purposes as well as of the facts on which its decisions are based. In the process, the administration will seek the views of as many Members of Congress concerned with a particular issue as possible. In short, the administration will strongly support the effort of the Congress to meet its constitutional

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obligations with wisdom and imagination.

Beyond the general requirement of advice and consent, the role of legislation and appropriations in defining the basic directions of policy is traditional. The administration may disagree with a particular decision; we may argue vigorously for a different course, as we have, for example, concerning the necessity of adequate aid to support the self-defense of allies in Indochina. But we welcome the indispensable contribution of Congress to the general direction of national policy.

At the same time, it is important to recognize that the legislative process—deliberation, debate, and statutory law—is much less well-suited to the detailed supervision of the day-to-day conduct of diplomacy. Legal prescriptions, by their very nature, lose sight of the sense of nuance and the feeling for the interrelationship of issues on which foreign policy success or failure so often depends. This is why the conduct of negotiations has always been preeminently an executive responsibility, though the national commitments which a completed agreement entails must necessarily have legislative and public support.

The growing tendency of the Congress to legislate in detail the day-to-day or week-to-week conduct of our foreign affairs raises grave issues. American policy—given the wide range of our interests and responsibilities—must be a coherent and a purposeful whole. The way we act in our relations with one country almost inevitably affects our relationship with others. To single out individual countries for special legislative attention has unintended but inevitable consequences and risks unraveling the entire fabric of our foreign policy.

Paradoxically, the President and the Congress share the same immediate objectives on most of the issues that have recently become sources of dispute. Too often, differences as to tactics have defeated the very purposes that both branches meant to serve, because the legislative sanctions were too public or too drastic or too undiscriminating. Our inability to implement the trade agreement with the Soviet Union is a case

in point; another is the impact of restrictions on aid to Turkey on our efforts both to advance the Cyprus peace negotiations and to safeguard our wider security interests in the eastern Mediterranean; yet another is the damage to our Western Hemisphere relations, specifically in Ecuador and Venezuela, caused by an amendment designed to withhold special tariff preferences from OPEC [Organization of Petroleum Exporting Countries] countries.

In fairness, it must be pointed out that Congressmen and Senators must represent the particular views of their constituencies. All reflect an electorate impatient with foreign turmoil and insistent that international responsibilities be shared more equitably. In a period of domestic recession the case for foreign aid becomes increasingly difficult to make. And yet the reality of interdependence links our destiny ever more closely with the rest of the world.

It is therefore understandable that one of the issues on which the Congress and the executive branch have recently divided is the degree to which foreign aid cutoffs—military or economic—can be used to bring about changes in the policies of other nations. Whether foreign aid should be used as an instrument of pressure depends on the way foreign aid is conceived.

The administration is convinced that foreign aid to be viable must serve American national interests above all, including the broad interest we have in a stable world. If an important American interest is served by the aid relationship, it is a wise investment; if not, our resources are being squandered, even if we have no specific grievances against the recipient.

For moral and practical reasons, we must recognize that a challenge to the recipient's sovereignty tends to generate reactions that far transcend the merit of most of the issues in dispute. Instead of influencing conduct in ways we desire, cutting aid is likely to harden positions. The very leverage we need is almost always lost; our bilateral political relationship is impaired, usually for no compensable benefit; and other friends and allies begin to question whether we under-

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stand our own national interest and whether we can be a reliable longer term partner.

These issues have little to do with the age-
old tension between morality and expediency.
Foreign policy, by its nature, must combine
a desire to achieve the ideal with a recogni-
tion of what is practical. The fact of sover-
eignty implies compromise, and each com-
promise involves an element of pragmatism.
On the other hand, a purely expedient policy
will lack all roots and become the prisoner
of events. The difficult choices are not be-
tween principle and expediency but between
two objectives both of which are good, or
between courses of action both of which are
difficult or dangerous. To achieve a fruitful
balance is the central dilemma of foreign
policy.

The effort to strengthen executive-legis-
lative bonds is complicated by the new char-
acter of the Congress. New principles of
participation and organization are taking
hold. The number of Congressmen and Sen-
ators concerned with foreign policy issues
has expanded beyond the traditional com-
mittees. Traditional procedures—focused as
they are on the congressional leadership and
the committees—may no longer prove ade-
quate to the desires of an increasingly indi-
vidualistic membership.

As the range of consultation expands, the
problem of confidentiality increases. Confi-
dentiality in negotiations facilitates compro-
mise; it must not be considered by the Con-
gress as a cloak of deception; it must not be
used by the executive to avoid its responsi-
bilities to the Congress.

Some of these problems are inherent in
the system of checks and balances by which
we have thrived. The separation of powers
produces a healthy and potentially creative
tension between the executive and the legis-
lative branches of government. Partnership
should not seek to make either branch a
rubber stamp for the other. But if old pat-
terns of executive-legislative relations are in
flux, now is the time for both branches to

concert to fashion new principles and prac-
tices of collaboration. The administration
stands ready to join with the Congress in
devising procedures appropriate to the need
for a truly national and long-range foreign
policy. We would welcome congressional sug-
gestions through whatever device the Con-
gress may choose, and we will respond in
the same spirit.

In the meantime, the administration will
strive to achieve a national consensus
through close consultation, the nonpartisan
conduct of foreign policy, and restraint in
the exercise of executive authority.

The problem of achieving a new national
partnership is difficult. I am confident that,
working together, the executive and the
Congress will solve it and thereby enhance
the vitality of our democratic institutions
and the purposefulness of our foreign policy.

In 1947, when another moment of crisis
summoned us to consensus and creation, a
Member of the Senate recalled Lincoln's
words to the Congress:

The dogmas of the quiet past are inadequate to
the stormy present. The occasion is piled high with
difficulty, and we must rise with the occasion. As
our case is new, so we must think anew and act
anew. We must disenthrall ourselves, and then we
shall save our country.

We have learned more than once that this
century demands much of America. And now
we are challenged once again "to think anew
and act anew" so that we may help ourselves
and the world find the way to a time of
hope. Let us resolve to move forward to-
gether, transforming challenge into oppor-
tunity and opportunity into achievement.

No genuine democracy can or should ob-
tain total unanimity. But we can strive for
a consensus about our national goals and
chart a common course. If we act with large
spirit, history could record this as a time of
great creativity, and the last quarter of this
century could be remembered as that period
when mankind fashioned the first truly
global community.

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In Birmingham, Alabama, on August 14, 1975, before the Southern Commodity Producers Conference (#38), HK addressed more specifically some of the things that had gone wrong in our domestic handling of foreign affairs--energy, Latin America, the Jackson Amendment, Cyprus, etc. We could not continue to conduct our foreign affairs in the same way as we conducted our domestic affairs:

But what this nation can do in the world depends upon how we conduct ourselves at home. For our national strength in every respect rests on our unity as a people.

There is a fundamental difference between the requirements of foreign policy and of domestic policy. In our own society, only some issues are matters of governmental concern; we can address these issues selectively, accommodate the different groups concerned, and legislate a solution that, hopefully, disposes of the problem.

Foreign policy, on the other hand, is the sum total of our nation's action abroad. Our involvement with the world outside is continual. Our action cannot be fragmented into a series of individual compromises except at grave risk. Every decision sets in motion a sequence of events and is in turn perceived by other nations as symbolic of our intentions and capabilities. Though we are a system of separated powers in Washington, to the world we are one government and one nation.

Our democratic system, and the broad participation of all of our people and private and public institutions, present a constant challenge to fashion unity out of diversity. We have done so in moments of crisis in the past; we must do so today in a moment of historic opportunity.

And here the recent controversies between

the two branches of our government give cause for serious concern. The Administration is held responsible for virtually all difficulties around the world—whether or not they resulted from its policies—and then is hamstrung in its capacity to act flexibly and purposefully.

—In energy, the lack of determined action on conservation and alternative sources seriously jeopardizes our efforts with other oil-consuming nations to reduce our vulnerability and to improve our bargaining position toward the producers.

—In Latin America, attempts to give impetus to a new dialogue are impaired by trade restrictions and automatic legislative sanctions that reduce our negotiating flexibility.

—In East-West relations, the leverage required to protect our national interest has been reduced by blanket legislative restrictions which have failed as well to achieve the humanitarian objectives they were meant to serve.

—In the eastern Mediterranean the stalemate over our military relations with Turkey threatens to unhinge the eastern flank of NATO. The President has proposed a compromise to break this congressional deadlock; the Senate, nearly half the House, and the leaders of both parties in both Houses, have

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supported it. When the Congress reconvenes
in September we hope for a rapid, coopera-
tive solution before irreparable damage is
done to our national security.

The country cannot afford the dominance
of *either* branch over the other. This is not
a constitutional or legal dispute. The issue
is how to conduct a single, purposeful
foreign policy in our democratic system. Our
Constitution gives the Congress wide author-
ity in key areas of our foreign and defense
policy. But the President represents the na-
tion abroad; he must have the possibility of
shaping and carrying out a coherent policy.
Accommodating special or parochial inter-
ests through a series of compromises does
not necessarily produce coherence; conten-
tion between the executive and Congress
risks falling between two stools on too many
grave issues.

The two branches of our government have
shown their ability in recent years to work
cooperatively. On many issues honest differ-
ences of opinion were reconciled and a com-
mon position achieved—the Romanian trade
agreement, the basic direction of our Middle
East policy, the preparation for the special
session of the General Assembly, and many
issues in arms control and policy.

Let us build on this. The President is a
man of Congress; he regards its members as
his colleagues, and he has pledged to cooper-
ate with them. The Administration will make
every effort to consult, inform, and work
with the Congress in making foreign policy.
And let me say that the close cooperation be-
tween the chairman of the Foreign Relations
Committee and the Administration has given

strength and impetus to our foreign policy.
When we are divided, when partisanship
produces bitter debates, we can do damage
that outlasts our present emotions; we harm
not only the country's fortunes today but the
hopes of future generations. But when we
are united together there is no force stronger
than the power of free men acting in unity.

Ladies and gentlemen, our nation has gone
through a searing decade. Assassination,
war, and internal turmoil have all left their
mark upon us. We began the 1960's secure
in our belief in the goodness of our purpose,
confident of our power to shape our future,
and proud of our youthful vitality. Yet 15
years later, tested by extraordinary events,
many came to believe that we were powerless
to affect the world and that our boldness had
given way to the weariness and timidity of
old age.

Already we can begin to see that the pessi-
mists, as so often, spoke too soon. Despite a
constitutional crisis unmatched since the
1860's, our government remains strong and
our freedoms stand undiminished. People
the world over have been reminded by our
adversity that their only real hope for a
better life lies in America's continued com-
mitment to a free and peaceful world. The
Administration has responded by making
clear that we will not retreat from our obli-
gations abroad and that we will not be
shaken by divided purpose at home.

Once again, a troubled world needs a
strong and confident America. It offers us no
simple choices but rather what Americans
have always welcomed: a challenge to our
courage, an opportunity to fresh accomplish-
ment, a summons to greatness.

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In The Wake of Indochina

As Indochina headed for its final collapse in April 1975, HK returned to the theme of national unity. HK spoke to the American Society of Newspaper Editors on April 17, 1975 in Washington (#26). Here the focus was on maintaining the national spirit in a time of setback. He pointed to the economic and social demoralization suffered by many of the industrial democracies as a result of the oil shocks; he hoped that the American people would preserve their traditional optimism, self-confidence and buoyancy. Indeed, he told the newspaper editors that his heartland visits restored his confidence that America would not retreat into cynicism or despair:

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ASNE Speech, Apr. 17, 1975 (excerpt)

I am here to sound a note of hope about the future of our foreign policy despite the fact that we are now going through a period of adversity.

A nation facing setbacks can submerge itself in acrimony, looking for scapegoats rather than lessons. It can ignore or gloss over its difficulties and fatuously proceed as if nothing serious had happened.

Or it can examine its situation dispassionately, draw appropriate conclusions, and chart its future with realism and hope.

President Ford has chosen this latter course.

* * *

In all these areas the American role has frequently been decisive. The design still stands; our responsibilities remain. There is every prospect for major progress. There is every reason for confidence.

## The Domestic Dimension

If this be true, what then is the cause of our problem? Why the setbacks? Why the signs of impasse between the executive and the Congress? What must we do to pull ourselves together?

Setbacks are bound to occur in a world which no nation alone can dominate or control. The peculiar aspect of many of our problems is that they are of our own making. Domestic division has either compounded or caused difficulties from the southern flank of NATO to the Pacific, from the eastern Mediterranean to relations between the superpowers.

Paradoxically, herein resides a cause for

optimism. For to the extent that the causes of our difficulties are within ourselves, so are the remedies.

The American people expect an effective foreign policy which preserves the peace and furthers our national interests. They want their leaders to shape the future, not just manage the present. This requires boldness, direction, nuance, and—above all—confidence between the public and the government and between the executive and the legislative branches of the government. But precisely this mutual confidence has been eroding over the past decade.

There are many causes for this state of affairs. Some afflict democracies everywhere; some are unique to America's tradition and recent history. Modern democracies are besieged by social, economic, and political challenges that cut across national boundaries and lie at the margin of governments' ability to control. The energies of leaders are too often consumed by the management of bureaucracy, which turns questions of public purpose into issues for institutional bargaining. Instant communications force the pace of events and of expectations. Persuasion, the essential method of democracy, becomes extraordinarily difficult in an era where issues are complex and outcomes uncertain. A premium is placed on simplification—an invitation to demagogues. Too often, the result is a disaffection that simultaneously debunks government and drains it of the very confidence that a democracy needs to act with conviction.

All of this has compounded the complex problem of executive-legislative relations. In every country, the authority of the modern state seems frustratingly impersonal or remote from those whose lives it increasingly affects; in nearly every democracy, executive authority is challenged by legislators who themselves find it difficult to affect policy except piecemeal or negatively. Issues become so technical that legislative oversight becomes increasingly difficult just as the issues become increasingly vital. The very essence of problem-solving on domestic issues—accommodation of special interests—robs foreign policy of consistency and focus

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when applied to our dealings with other nations.

Statesmen must act, even when premises cannot be proved; they must decide, even when intangibles will determine the outcome. Yet predictions are impossible to prove; consequences avoided are never evident. Skepticism and suspicion thus become a way of life and infect the atmosphere of executive-legislative debate; reasoned arguments are overwhelmed by a series of confrontations on peripheral issues.

America faces as well the problem of its new generation. The gulf between their historical experience and ours is enormous. They have been traumatized by Viet-Nam as we were by Munich. Their nightmare is foreign commitment as ours was abdication from international responsibility. It is possible that both generations learned their lessons too well. The young take for granted the great postwar achievements in restoring Europe, building peacetime alliances, and maintaining global prosperity. An impersonal, technological, bureaucratized world provides them too few incentives for dedication and idealism.

Let us remember that America's commitment to international involvement has always been ambivalent—even while our doubts were being temporarily submerged by the exertions of World War II and the postwar era. The roots of isolationism, nourished by geography and history, go deep in the American tradition. The reluctance to be involved in foreign conflicts, the belief that we somehow defile ourselves if we engage in “power politics” and balances of power, the sense that foreign policy is a form of Old World imperialism, the notion that weapons are the causes of conflict, the belief that humanitarian assistance and participation in the economic order are an adequate substitute for political engagement—all these were familiar characteristics of the American isolationism of the twenties and thirties. We took our power for granted, attributed our successes to virtue, and blamed our failures on the evil of others. We disparaged means. In our foreign involvement we have oscillated between exuberance and exhaustion, be-

tween crusading and retreats into self-doubt.

Following the Second World War a broad spectrum of civic leaders, professional groups, educators, businessmen, clergy, the media, congressional and national leaders of both parties led American public opinion to a new internationalist consensus. Taught by them and experience of the war, the nation understood that we best secured our domestic tranquillity and prosperity by enlightened participation and leadership in world affairs. Assistance to friends and allies was not a price to be paid, but a service to be rendered to international stability and therefore to our self-interest.

But in the last decade, as a consequence of Indochina and other frustrations of global engagement, some of our earlier impulses have reasserted themselves. Leadership opinion has, to an alarming degree, turned sharply against many of the internationalist premises of the postwar period. We now hear, and have for several years, that suffering is prolonged by American involvement, that injustice is perpetuated by American inaction, that defense spending is wasteful at best and produces conflict at worse, that American intelligence activities are immoral, that the necessary confidentiality of diplomacy is a plot to deceive the public, that flexibility is cynical and amoral—and that tranquillity is somehow to be brought about by an abstract purity of motive for which history offers no example.

This has a profound—and inevitable—impact on the national mood and on the national consensus regarding foreign policy. In the nation with the highest standard of living and one of the richest cultures in the world, in the nation that is certainly the most secure in the world, in the nation which has come closest of all to the ideals of civil liberty and pluralist democracy, we find a deep and chronic self-doubt, especially in the large urban centers and among presump- tive leaders.

Will the American people support a responsible and active American foreign policy in these conditions? I deeply believe that they will—if their leaders, in and out of government, give them a sense that they have

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something to be proud of and something important to accomplish.

When one ventures away from Washington into the heart of America, one is struck by the confidence, the buoyancy, and the lack of any corrosive cynicism. We who sit at what my friend Stewart Alsop, a great journalist, once called "the center" tend to dwell too much on our problems; we dissect in overly exquisite detail our difficulties and our disputes.

I find it remarkable that two-thirds of the Americans interviewed in a nationwide poll in December, at a time of severe recession, still thought an active role in the world served their country's interests better than withdrawal. Even as other nations are closely watching the way we act in Washington, I suspect they marvel at the resiliency of our people and our institutions.

There is a great reservoir of confidence within America. We have the values, the means, and we bear the responsibility to strive for a safer and better world. And there is a great reservoir of confidence around the globe in this country's values and strength.

## Where Do We Go From Here?

So, let us learn the right lessons from today's trials.

We shall have to pay the price for our setbacks in Indochina by increasing our exertions. We no longer have the margin of safety. In the era of American predominance, America's preferences held great sway. We could overwhelm our problems with our resources. We had little need to resort to the style of nations conducting foreign policy with limited means: patience, subtlety, flexibility. Today, disarray, abdication of responsibility, or shortsightedness exact a price that may prove beyond our means.

We are still the largest single factor in international affairs, but we are one nation among many. The weight of our influence now depends crucially on our purposefulness, our perseverance, our creativity, our

power, and our perceived reliability. We shall have to work harder to establish the coherence and constancy of our policy—and we shall.

We must give up the illusion that foreign policy can choose between morality and pragmatism. America cannot be true to itself unless it upholds humane values and the dignity of the individual. But equally it cannot realize its values unless it is secure. No nation has a monopoly of justice or virtue, and none has the capacity to enforce its own conceptions globally. In the nuclear age especially, diplomacy—like democracy—often involves the compromise of clashing principles. I need not remind you that there are some 140 nations in the world, of which only a bare handful subscribe to our values.

Abstract moralism can easily turn into retreat from painful choices or endless interference in the domestic affairs of others; strict pragmatism, on the other hand, robs policy of vision and heart. Principles without security spell impotence; security without principles means irrelevance. The American people must never forget that our strength gives force to our principles and our principles give purpose to our strength.

Let us understand, too, the nature of our commitments. We have an obligation of steadfastness simply by virtue of our position as a great power upon which many others depend. Thus our actions and policies over time embody their own commitment whether or not they are enshrined in legal documents. Indeed, our actions and the perception of them by other countries may represent our most important commitments.

At the same time, diplomacy must be permitted a degree of confidentiality, or most serious exchange with other governments is destroyed. To focus the national debate on so-called secret agreements which no party has ever sought to implement and whose alleged subject matter has been prohibited by law for two years is to indulge what Mencken called the "national appetite for bogus revelation." It goes without saying that a commitment involving national action must be known to the Congress or it is meaningless.

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One lesson we must surely learn from Viet-Nam is that new commitments of our nation's honor and prestige must be carefully weighed. As Walter Lippmann observed, "In foreign relations, as in all other relations, a policy has been formed only when commitments and power have been brought into balance." But after our recent experiences we have a special obligation to make certain that commitments we have made will be rigorously kept and that this is understood by all concerned. Let no ally doubt our steadfastness. Let no nation ever believe again that it can tear up with impunity a solemn agreement signed with the United States.

We must continue our policy of seeking to ease tensions. But we shall insist that the easing of tensions cannot occur selectively. We shall not forget who supplied the arms which North Viet-Nam used to make a mockery of its signature on the Paris accords.

Nor can we overlook the melancholy fact that not one of the other signatories of the Paris accords has responded to our repeated requests that they at least point out North Viet-Nam's flagrant violations of these agreements. Such silence can only undermine any meaningful standards of international responsibility.

At home, a great responsibility rests upon all of us in Washington.

Comity between the executive and legislative branches is the only possible basis for national action. The decade-long struggle in this country over executive dominance in foreign affairs is over. The recognition that the Congress is a coequal branch of government is the dominant fact of national politics today.

The executive accepts that the Congress must have both the sense and the reality of participation; foreign policy must be a shared enterprise. The question is whether the Congress will go beyond the setting of guidelines to the conduct of tactics; whether it will deprive the executive of discretion and authority in the conduct of diplomacy while at the same time remaining institutionally incapable of formulating or carrying out a clear national policy of its own.

The effective performance of our constitutional system has always rested on the restrained exercise of the powers and rights conferred by it. At this moment in our history there is a grave national imperative for a spirit of cooperation and humility between the two branches of our government.

Cooperation must be a two-way street. Just as the executive has an obligation to re-examine and then to explain its policies, so the Congress should reconsider the actions which have paralyzed our policies in the eastern Mediterranean, weakened our hand in relations with the U.S.S.R., and inhibited our dialogue in this hemisphere. Foreign policy must have continuity. If it becomes partisan, paralysis results. Problems are passed on to the future under progressively worse conditions.

When other countries look to the United States, they see one nation. When they look to Washington, they see one government. They judge us as a unit—not as a series of unrelated or uncoordinated institutions. If we cannot agree among ourselves, there is little hope that we can negotiate effectively with those abroad.

So one of the most important lessons to be drawn from recent events is the need to restore the civility of our domestic discourse. Over the years of the Viet-Nam debate rational dialogue has yielded to emotion, sweeping far beyond the issues involved. Not only judgments but motives have been called into question. Not only policy but character has been attacked. What began as consensus progressively deteriorated into poisonous contention.

Leaders in government must do their share. The Administration, following the President's example, will strive for moderation and mutual respect in the national dialogue. We know that if we ask for public confidence we must keep faith with the people.

Debate is the essence of democracy. But it can elevate the nation only if conducted with restraint.

The American people yearn for an end to the bitterness and divisiveness of the past

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decade. Our domestic stability requires it.

Our international responsibilities impose it.

You, in this audience, are today in a unique
position to contribute to the healing of the
nation.

HK took the same theme to the heartland, speaking at the St. Louis World Affairs Council on May 12, 1975 (#27). He stressed that Americans should take pride in what their country had achieved in world affairs. American leadership remained vital if the world was to face up to its unprecedented new challenges. We faced great opportunities for new achievement:

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—Democratic, 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 alters the American perception of our international responsibilities and causes us to dismantle our accomplishments, we will produce instability in the world and create untold dangers for our country.

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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.

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 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 many millions of 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 involve itself; that not

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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 lacking 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 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 interdependent 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 have come to characterize their relationship.

We do not ask that the Congress rubber-stamp 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 prescriptions of individual moves, our foreign policy will eventually be deprived of consistency, direction, strength, and flexibility.

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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 measure, we have given more in the last 30 years than any other nation in history. We have successfully resisted serious threats to world order from those who wished to change it in ways that would have involved unacceptable consequences for democratic governments. We have provided more economic assistance to others than any other country. 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 mankind 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.

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HK stressed the same theme in a heartland speech in Atlanta on June 23, 1975 (#34) before the Southern Council on International and Public Affairs and the Atlantic Chamber of Commerce. A "time of testing," he declared, is turning into a "time of renewal." The American people knew that America's progress and the well being of peoples everywhere depended on a strong American role of leadership in the world:

> We meet at a time when America, as so often before in its history, is turning a time of testing into a period of renewal.

Less than three months ago, under the impact of our disappointments in Indochina, some were questioning the very nature of our involvement in world affairs. The executive and the Congress seemed to be heading for a stalemate on foreign policy. But paradoxically, our setbacks have brought home to us —as well as the rest of the world—how essential America is to the peace and prosperity of mankind. And at home the dialogue between our two coequal branches of government is taking place in a more constructive atmosphere.

We have every reason to face our future with confidence. The United States still stands as the greatest democracy the world has ever known. Our institutions have withstood extraordinary turmoil and dissension and have emerged vital and strong. Whatever our disappointments, we have reason for pride in our achievements. If there is peace in the world today, our sacrifice has been decisive; if there is to be progress, our contribution will be essential.

We have learned irrevocably the central fact of the modern world: our security, our well-being, our very existence, are intimately bound up with the kind of international environment we shall succeed in building. If the weakness of free peoples tempts aggression, the lives of Americans will be in danger. If the disunity of free peoples invites economic chaos, the well-being of Americans will be in jeopardy. As the energy crisis surely has taught us, we live in an interdependent world—a world in which words

such as "isolation" and "withdrawal" grow ever more anachronistic.

Thus we are not about to reverse the course of the last 30 years, retreat from our commitments, and leave our friends and allies to fend for themselves in the vacuum our actions would inevitably create. We shall not invite chaos. On the contrary, before us is a new opportunity to achieve peace and progress greater than even in our recent past.

Since the end of World War II, the United States has undertaken a role of world leadership which has had the support of both parties and all Administrations. That policy has preserved peace and freedom; it has sustained global stability and the global economy. Indeed, it is our very accomplishments that have created the new conditions, and problems, which we must now face.

## Challenge at Home

We have before us a vast agenda. The peace and prosperity of future generations depend on decisions we make now. The choice is relatively straightforward: either we use our strength and opportunities for good, or others will surely use their own strength for ends incompatible with our values. The problems we face are of such magnitude, their answers so complex—and the opportunities so far-reaching—that the last quarter of the 20th century will either be remembered as another period of American leadership and creativity or as a time of growing chaos and despair. Therefore it is time to put an end to the self-doubt

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and cynicism which have marked, and marred, American life for so much of the past decade. It is time to remind ourselves that America has accomplished great things in the past and that there are still greater things to be accomplished.

In our pluralistic society, national action depends on the support of citizens everywhere—not only in government but in the professions, in business and labor, in the universities, in the cities and on the farms all over America. These people, in their millions, have supported an enlightened international involvement for more than a

generation; for they knew in their hearts that the greatest nation on earth could no longer remain isolated from the world around it. Again today, at another time of decision, it will be the American people who will decide, as they should, the direction their country will take.

There can be no doubt about the outcome. The American people will decide to keep their country the pillar of stability and the vision of hope that it has been for two centuries. They will support our leadership in the search for a new, lasting, just and peaceful international order.

In Minneapolis on July 15, 1975 (#36), the appeal for domestic unity was sounded again, this time in the context of a speech on morality in foreign policy. The discussion of morality is dealt with in an earlier section. The appeal for unity reflected the theme of earlier speeches such as the ASNE speech: It was time to end our divisive debates on these issues and to come together to address the great challenges the world faced:

We live in a secular age which prides itself on its realism. Modern society is impersonal and bureaucratized. The young, who in every generation crave a sense of purpose, are too often offered cynicism and escapism instead of a faith that truly inspires. All modern democracies are beset by problems beyond the margin of government's ability to control. Debunking of authority further drains democratic government of the ability to address the problems that beset it. A world of turmoil and danger cries out for structure and leadership. The opportunities that we face as a nation to help shape a more just international order depend more than ever on a steady, resolute, and self-assured America.

This requires confidence—the leaders' confidence in their values, the public's confidence in its government, and the nation's collective confidence in the worth of its objectives.

Thus, for this nation to contribute truly to peace in the world it must make peace with

itself. It is time to put aside the cynicism and distrust that have marked—and marred—our political life for the better part of the past decade. It is time to remind ourselves that, while we may disagree about means, as Americans we all have the same ultimate objective—the peace, prosperity, and tranquillity of our country and of the world.

And most of all, it is time we recognized that as the greatest democracy the world has ever known, we are a living reminder that there is an alternative to tyranny and oppression. The revolution that we began 200 years ago goes on, for most of the world still lives without the freedom that has for so long been ours. To them we remain a beacon of hope and an example to be emulated.

So let us come together for the tasks that our time demands. We have before us an opportunity to bring peace to a world that awaits our leadership.

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On September 16, 1975, in a speech in Cincinnati before a dinner meeting sponsored by the Greater Cincinnati Chamber of Commerce and other area organizations (#41), HK returned to the theme of unity in his closing remarks. As the election season began, "we cannot afford a year and a half of partisan warfare:"

## American Leadership and American Unity

Ladies and gentlemen, we Americans have spent the better part of a decade apologizing to ourselves and the world for what we thought we had become. We have spent most of the last three years enmeshed in a national tragedy that caused many to lose sight of what our country has meant, and continues to mean, to the billions abroad who look to the United States as a beacon of freedom and hope.

Today the issues that threatened our unity and confidence are in the process of being put behind us. A world of turmoil, danger, and opportunity cries out for our purposeful leadership. There is no doubt of our physical capacity and technical skill. But we must put them in the service of a common purpose.

After a decade of challenge and crises, we must strive to insure that our government will be united, that our people will have confidence, that our country will be strong, and that our freedoms will flourish. As we enter the year of a political campaign at home— in an era of unprecedented challenge abroad —a spirit of unity and bipartisanship becomes our international as well as national duty. We cannot afford a year and a half of partisan warfare. Our foreign policy must

be a common enterprise of all Americans, for what we do—or fail to do—will inevitably affect events for many years to come.

If the past two years of effort in the Middle East have lessened the dangers of war, and set that part of the world on the road to peace—as I pray they have—it is the United States that has made the difference. It is the United States alone among the world's nations that Israel and its Arab neighbors were prepared to trust. It has been deeply moving for me to observe, after all the travails and self-doubts of the last decade, the confidence that others have in us. The nations of the Middle East have thus done us a service, in reminding us of how in serving our international responsibility we also serve our own highest goals.

In the final analysis it is our own principles and hopes that define our obligation. America has always stood for something beyond our own material success: we have always believed—correctly—that we meant something to others. Our Founding Fathers spoke of the rights and hopes of all men. Our belief in the inalienable rights of man is no less compelling today—no less worthy of sacrifice—than it was 200 years ago when a few dreamers came together in Philadelphia to proclaim history's only truly permanent revolution.

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On February 4, 1976, at the University of Wyoming at Laramie (#50), HK spoke again about the "imperative" of domestic unity, indirectly replying to critics of both left and right. It was time to put an end to the "destructive debate" that had been impeding our foreign policy:

It is good to be here in the West. The people of this land remind me once again that America is not the cynical, confused, and tired nation so many in Washington would have us believe it is. Instead, as I have so often seen in my trips, the American people continue to have pride in their country. They know that America has done more for the world, and for peace, over the past 30 years than any nation in history. They know we have given more of our resources, fed more of the starving, taken in more immigrants, and educated more people from other lands than any other nation before us.

The American people are tired of hearing how evil we are, how terrible are our mistakes, and how misguided our purposes. They know better. And they want better.

It is true that we have passed through a decade and more of tragedy—we have been witness to assassination; we have suffered through a tragic war that shattered our domestic unity; and we have endured our greatest constitutional crisis since the Civil War.

But we have come through these difficult times with our institutions as strong as ever. We remain the world's greatest democracy; we continue to be the bastion to which other nations look for their protection; and we remain the symbol of hope to the millions around the world who live in tyranny and poverty but yearn for freedom and prosperity.

★★★

The structure of our foreign policy is sound and ready to encounter the future.

But America cannot hope to shape the future of the world unless we are a confident and united people.

### America's Imperative: Domestic Unity

For more than three decades America has, despite setbacks and mistakes, conducted

a remarkably effective foreign policy. We have done so because we recognized, even when we disagreed, that what we did beyond our borders was done in the name of the nation as a whole. Partisan interests were channeled into positive accomplishments. We acted as a confident people. We did not doubt ourselves; we did not consume ourselves in self-hatred.

That was the ultimate underpinning for the role of world leadership that was thrust upon us; it was the true measure of our greatness. It is a strength we must not lose.

History has made America the repository and guardian of the best values of mankind, for no other free nation is strong enough to replace us. Without our commitment there can be no progress. We must have the steadieness to oppose military pressures and the vision to work for a more peaceful international order. Moderation has meaning only when practiced by the strong, and strength has purpose only when tempered by conciliation.

These twin strands of firmness and conciliation reflect the permanent interests of our nation. Yet our ability to pursue either course has been, in recent months, increasingly threatened. A strong, coherent, and effective international role is jeopardized by acrimonious controversy which thwarts serious discussion of the great issues and by the growing tendency of too many in the Congress not only to supervise but to legislate the day-to-day conduct of foreign policy.

The slogans of a past we thought we had transcended are suddenly reappearing. We now hear again that suffering is prolonged by American involvement, that injustice is perpetuated by American commitments, that defense spending is wasteful at best and produces conflict at worst, that American intelligence activities are immoral, that the necessary confidentiality of diplomacy is a plot to deceive the public, that flexibility is cynical, and that tranquillity is somehow to be brought about by an abstract purity of

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If these attitudes shape our policies, we will deprive our diplomacy of its essential tools; conciliatory policies and firm measures alike will be undermined by growing doubt about the steadiness of our national will. An atmosphere of suspicion and a lack of even the most elementary confidentiality will make impossible the management of the government and the conduct of negotiation. If a national consensus does not exist, our policy will be driven by narrow interest groups and short-term political considerations.

In an era when the danger of war has been reduced but the rivalry of communism and freedom continues, the gray area between foreign policy and overt conflict continues to be important and, indeed, takes on increasing significance. Yet leaks, sensational investigations, and the demoralization of our intelligence services—at a time when our adversaries are stepping up their own efforts—are systematically depriving our government of the ability to respond.

An effective foreign policy requires a strong national government which can act with assurance and speak with confidence on behalf of all Americans. But when the executive is disavowed repeatedly and publicly, other governments wonder who speaks for America and what an American commitment means. Our government is in danger of progressively losing the ability to shape events, and a great nation that does not shape history eventually becomes its victim.

Too much depends upon a strong and confident America to allow this state of affairs to continue. When America abdicates from shaping the future, when its policy falls prey to the passions of the moment and the play of pressure groups, it disheartens friends, emboldens adversaries, and gives pause to the wavering and thus undermines international order.

We must restore our unity while the essential structure of our foreign policy is still sound and before irreparable damage is done to it. We retain the capacity, if we have the will, to prevent military expansion by

our adversaries. Our alliances with the industrialized nations have never been more solid. A further agreement to limit the strategic arms race is within reach. We are well launched on a durable and improving relationship with the world's most populous nation. The elements for peace in the Middle East exist. A dialogue with the developing world has begun on a hopeful note. The threat of war around the globe has been reduced. The principal danger we face is our domestic divisions.

The American people have a right to demand of their leaders in and out of government an end to the destructive debate that has in recent months come to mark our political process. They know, as the world knows, that the United States is still a great country. And they know how much damage these continuing attacks on their country's institutions have done and will do to undermine America's ability to keep the peace.

We have every obligation to draw the right lessons from our past mistakes and to see that they never happen again. But we have an equally compelling duty. to remember that a faltering of will on the part of a country that has for decades been the principal guarantor of peace and progress can have disastrous consequences for the prospects of a better and safer world.

America now finds itself in a world of proliferating, often competitive, and sometimes threatening power. We must often make choices that will not solve but only manage problems; we must occasionally make compromises that by definition will not produce ideal results. We need confidence in ourselves to master a complicated period in which the United States can no longer overwhelm problems with resources—when it needs purpose, firmness, coherence, flexibility, imagination, and above all, unity.

The formulation and conduct of our foreign policy must of course be the product of consultation and accommodation between the Congress and the President. Neither branch can, alone, determine the course we will pursue abroad. The Congress, entitled by the letter and spirit of the Constitution and by

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the practices of 200 years, must be an equal partner in the process.

But if that partnership is to flourish, each branch must respect the role of the other, and each must recognize the limitations—constitutional and practical—on its authority. The Congress can set broad guidelines and decide basic policies. But the Congress does not have the organization, the information, or the responsibility for deciding the tactical questions that arise daily in the conduct of our foreign relations or for executing a coherent, consistent, comprehensive policy. The President has this responsibility and must be permitted to exercise it on behalf of the entire nation. For in the last analysis, the United States, when it deals with other nations, must speak with one voice.

It is time we recognize that, increasingly, our difficulties abroad are largely of our own making. If America is to be safe, we must cease dismantling and demoralizing our intelligence services. If America is to preserve its values and maintain the global balance of stability, we must have a strong defense. And if America is to help build a world environment in which our citizens can thrive and be free, we cannot deny ourselves the essential tools of policy. Without these our only option is to retreat, to become an isolated fortress island in a hostile and turbulent global sea, awaiting the ultimate confrontation with the only response we will not have denied ourselves—massive retaliation. Our branches of government, special interests, and ordinary citizens must pursue their legitimate concerns with an understanding that there are basic overriding national interests which, if neglected, will render pointless all else we do.

In our age, whose challenges are without precedent, we need once again the wisdom of our Founding Fathers. Our pragmatic tradition must help us understand reality and shape it, rather than be diverted by an obsession with technical detail or method without purpose. Our love of our country must inspire us to persevere with dedication and unity and not to consume our substance in civil strife. Our idealism should remind

us that we remain the beacon of hope for all those who love liberty and that this imposes a heavy responsibility upon us.

Our international role is not a burden; it protects the lives and well-being of our people. It has been a historical success. In our first two centuries we have done great things as a united people. We can accomplish even more in our third century. America remains the strongest nation in the world; our government continues to be the noblest experiment undertaken by man; we still are an inspiration to all the world's millions who are much less fortunate than we. Our past achievements should be but prologue to the exciting future that crowds in upon us. It is, in the final analysis, up to us.

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HK delivered a speech in Boston on March 11, 1976, before the Boston World Affairs Council (#54). It was entitled "America's Permanent Interests." The speech included a sharp reply to critics of both right and left, particularly on the theme of US-Soviet relations. In it, HK declared that "our greatest foreign policy problem is our divisions at home:"

The challenges before us are monumental. But it is not every generation that is given the opportunity to shape a new international order. If the opportunity is missed, we shall live in a world of chaos and danger. If it is realized we will have entered an era of peace and progress and justice.

But we can realize our hopes only as a united people. Our challenge—and its solution—lies in ourselves. Our greatest foreign policy problem is our divisions at home. Our greatest foreign policy need is national cohesion and a return to the awareness that in foreign policy we are all engaged in a common national endeavor.

The world watches with amazement—our adversaries with glee and our friends with growing dismay—how America seems bent on eroding its influence and destroying its achievements in world affairs through an orgy of recrimination.

They see our policies in Africa, the eastern Mediterranean, in Latin America, in East-West relations undermined by arbitrary congressional actions that may take decades to undo.

They see our intelligence system gravely damaged by unremitting, undiscriminating attack.

They see a country virtually incapable of behaving with the discretion that is indispensable for diplomacy.

They see revelations of malfeasance abroad on the part of American firms wreak grave damage on the political structures of friendly nations. Whatever wrongs were

committed—reprehensible as they are—should be dealt with in a manner consistent with our own judicial procedures and with the dignity of allied nations.

They see some critics suddenly pretending that the Soviets are 10 feet tall and that America, despite all the evidence to the contrary, is becoming a second-rate nation. They know these erroneous and reckless allegations to be dangerous, because they may, if continued, persuade allies and adversaries of our weakness, tempting the one to accommodation and the other to adventurism.

They see this Administration—which has been condemned by one set of critics for its vigorous reaction to expansionism in Southeast Asia, in the Middle East, in Africa—simultaneously charged by another group of opponents with permitting unilateral Soviet gains.

They see that the Administration whose defense budgets have been cut some $39 billion by the Congress in the past seven years is simultaneously charged with neglecting American defenses.

The American people see all this, too, and wonder when it will end. They know that we cannot escape either our responsibilities or the geopolitical realities of the world around us. For a great nation that does not manage events will soon be overwhelmed by them.

If one group of critics undermines arms control negotiations and cuts off the prospect of more constructive ties with the Soviet Union while another group cuts away at our defense budgets and intelligence services and

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thwarts American resistance to Soviet ad-
venturism, both combined will—whether
they have intended it or not—end by wreck-
ing the nation's ability to conduct a strong,
creative, moderate, and prudent foreign pol-
icy. The result will be paralysis, no matter
who wins in November. And if America can-
not act, others will, and we and all the free
peoples of the world will pay the price.

So our problem is at once more complex
and simpler than in times past. The chal-
lenges are unprecedented but the remedies
are in our own hands. This Administration
has confidence in the strength, resilience,
and vigor of America. If we summon the
American spirit and restore our unity, we
will have a decisive and positive impact on
a world which, more than ever, affects our
lives and cries out for our leadership.

Those who have faith in America will tell
the American people the truth:

-That we are strong and at peace;

-That there are no easy or final answers
to our problems;

-That we must conduct a long-term and
responsible foreign policy, without escape
and without respite;

-That what is attainable at any one moment

will inevitably fall short of the ideal;

-That the reach of our power and purpose has its limits;

-That nevertheless we have the strength
and determination to defend our interests
and the conviction to uphold our values; and
finally,

-That we have the opportunity to leave
our children a more cooperative, more just,
and more peaceful world than we found.

In this Bicentennial year, we celebrate
ideals which began to take shape around the
shores of Massachusetts Bay some 350 years
ago. We have accomplished great things as
a united people. There is much yet to do.
This country's work in the world is not a
burden but a triumph—and the measure of
greatness yet to come.

Americans have always made history
rather than let history chart our course. We,
the present generation of Americans, will do
no less. So let this year mark the end of our
divisions. Let it usher in an era of national
reconciliation and rededication by all Ameri-
cans to their common destiny. Let us have a
clear vision of what is before us—glory and
danger alike—and go forward together to
meet it.

HK stressed the same themes in a somewhat more conciliatory fashion in his presentation to the so-called "bicentennial hearings" of the SFRC on March 16, 1976 (#55). (These were hearings on "foreign policy choices for the 1970s and 1980s.") "We can accomplish great things," HK declared, "but only as a united people:"

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A heavy responsibility lies with us here in Washington. The Congress and the executive owe the American people an end to the divisions of the past decade. The divisive issues are no longer with us. The tasks ahead of us are not partisan or ideological issues; they are great tasks for America in a new century, in a new world that, more than ever, impinges upon our lives and cries out for our leadership. Even more than our resources, the creative vitality of this nation has been a tremendous force for good and continues to be so.

We can accomplish great things—but we can do so only as a united people. Beyond all the special concerns and special interests lies the national interest. Congress and the executive, Republicans and Democrats, have a common stake in the effectiveness and success of American foreign policy. Most of the major initiatives this government has taken on fundamental issues—with our allies, with the People's Republic of China, with the Soviet Union, with the developing nations, in the Middle East—have had broad and deep support in the Congress and in the country.

Therefore, just as we have the capacity to build a more durable international structure, so we have the capacity and opportunity to rebuild the consensus among the executive and legislative branches and among our

people that will give new impetus to our responsible leadership in the world in our third century. This is the deepest desire of the President and the strongest commitment of all his Administration.

Mr. Chairman, members of the Committee, I hope that this discussion of what we see as the issues of the future will be helpful in the building of such a consensus. The issues are complex; the degree of public understanding required to deal with them is higher than at any time in our historical experience. And even if we can reach a consensus on objectives and priorities, our resources and options are limited and we cannot hope always to prevail or to be right.

These hearings are a wise and welcome step in promoting the understanding and consensus that are required. Our gift as a people is problem-solving and harnessing the capacities of widely diverse groups of people in large-scale common endeavor. This is exactly what is required of us, both in building a new international structure and in developing the public support needed to sustain our participation in it over the long term.

In the last analysis, we must come together because the world needs us, because the horizons that beckon us in the decades to come are as near, or as far, as we have the courage to seek them.

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[y]

In Dallas on March 22, 1976, at a dinner meeting sponsored by Southern Methodist University, the World Affairs Council of Dallas, and other local organizations (#56), HK spoke on the subject of defense, partly in response to right-wing critics. (See pp. 109-115 above.) HK ended the speech with a call to unity, saying that our setbacks had not come about because we were weak but because we were divided:

> Ladies and gentlemen, military strength is crucial to America's security and well-being. But we must take care not to become so obsessed with power alone that we become a "Fortress America" and neglect our ultimate political and moral responsibilities.

Our nation is the beacon of hope to all who love freedom not simply because it is strong, but because it represents mankind's aged dream of dignity and self-respect. Others before us have wielded overwhelming military power and abdicated moral responsibility or engendered fear and hatred. Our resources—military, industrial, technological, economic, and cultural—are beyond challenge; with dedication and effort they shall remain so. But a world of tenuous balance, of a nuclear equilibrium constantly contested, is too barren and perilous and uninspiring. America has always stood for something deeper than throwing its weight around; we shall see to it that we shall never relinquish our moral leadership in the search for a just and lasting peace.

We have gone through a difficult decade not because we were weak, but because we were divided. None of our setbacks has been caused by lack of American power, or even lack of relevant power. The fundamental challenge to America therefore is to generate the wisdom, the creativity, and the will to dedicate ourselves to the peace and progress of humanity.

America's ultimate strength has always been the conviction and basic unity of its people. And despite a decade and more of testing—despite assassination, war, and institutional crisis—we still remain a vital and

optimistic and confident people.

It is time once again for Americans to hold their heads high. It is important to recall once again some fundamental truths:

- We are still the strongest nation on the face of the earth.

- We are the most generous nation in history; we have fed the starving, opened our arms and our hearts to refugees from other lands, and given more of our substance to the poor and downtrodden around the world than any other nation.

- We are needed to maintain the world's security.

- We are essential to any hopes for stability and human progress.

- We remain the bulwark of democracy and the land of promise to millions who yearn for freedom and a better life for themselves and their children.

- We therefore have a responsibility to hold high the banner of freedom and human dignity for all mankind.

Our record of achievements should be but prologue to what this generation of Americans has it within its power to accomplish. For the first time in history, we can work with others to create an era of peace and prosperity for all mankind.

We shall not fail. With faith in the goodness and the promise of America we shall master our future. And those who celebrate America's tricentennial will look back and say that this generation of Americans was worthy of the ideals and the greatness of our history.

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[Y]

In Phoenix, HK spoke on the subject of "a strong foreign policy for a confident America" on April 16, 1976, before a luncheon meeting sponsored by the Downtown Rotary Club (#60). Here he took on the canard that he was an historical pessimist:

I am happy to be here in the great South-west, where the freshness and vitality of the American spirit are so evident.

In recent years we have seen opinion on foreign policy in this country swing back and forth erratically—from peace demonstrations to calls for confrontation, from antimilitarism to concern for a strong defense, from overinvolvement to a new isolationism, from enthusiasm to disillusionment, and back again.

Today some would have Americans believe that the issue is between those who are optimistic and those who are pessimistic about America. But that is *not* the problem before us. The real issue is whether we understand the complexities and the opportunities that are before us.

Winston Churchill once said: "When danger is far off, we may think of our weakness; when it is near, we must not forget our strength." A period of thermonuclear peril and global upheaval is not the moment to forget our successes, our unequaled reserves of military and economic power, or the decisive advantages we enjoy as a free people with a free productive system.

In this Bicentennial year it is time to remind ourselves that an effective foreign policy must reflect the values and permanent interests of our nation, and not the fashionable trends of the moment. These values and interests antedate this election year and must be maintained beyond it.

I am here to tell you that America remains—and will remain—the most powerful nation in the world. I am here to tell you that the President and his Administration have founded their policies on a fundamental faith in America's vast strength and potential for greatness. We see challenging trends, but we are confident that they can be

mastered. We see dangers, but we are certain that they can be overcome.

The optimist is not one who pretends that challenges do not exist; that is escapism. The true optimist has faith in his nation; he believes that challenges are to be mastered, not avoided. He is willing to trust the intelligence of the public, for he knows that Americans can understand and deal with complexity. He knows that Americans have always regarded challenge not as a cause for despair, but as a call to action, a stimulus to achievement, and a priceless chance to shape the future.

The Founding Fathers, the pioneers who opened up this vast land, the men and women who built the greatest and freest and most productive society in history—they were people of confidence and hope. Those of us today who truly have faith in America will live up to that tradition.

To oversimplify, to substitute brittle rhetoric for hard thinking, is not confidence in America. To offer slogans instead of answers is to show little faith in the American people.

The task of foreign policy is to understand our reality, to perceive the challenges to our interests and principles. It is to devise means for meeting those challenges. And it is to persevere toward our goals unafraid and unswayed by the passions of the moment.

Government in a free society has the obligation to tell the people the truth, without sugar-coating or resorting to scare tactics. The real issue before our country now is not between optimists and pessimists, but between those who support a strong American leadership in the world and those who believe that America cannot, or should not, play such a role.

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It is in this spirit that next week I shall go to Africa, where I will carry America's message of hope, social justice, aspiration for human dignity, the rule of the majority, and cooperation. And I shall also warn against foreign intervention, direct or surrogate, that would block all hope for progress.

But we can realize our historic responsibility only as a united and confident people. Our greatest foreign policy need is to end our divisions and self-denigration, to recall that we have permanent interests and values that we must nurture and defend, to recapTURE the sense that we are all engaged in a common enterprise.

We remain the world's strongest nation, but we no longer have the overwhelming global predominance of previous decades. Today we must lead not by our power alone but by our wisdom, boldness, vision, and perseverance. We must be a steadfast friend to those who would be our friend; we must be a determined opponent of those who would be our enemy. We must maintain simultaneously our defenses, our alliances, our principles, and our commitment to a co-operative world. And I have every confidence in our ability to do so.

In this Bicentennial year we honor our Founding Fathers for many things—but most of all for their faith in the American people, on whom the success of the American experiment has always depended. They were dreamers who believed in the future and the nation they had created. They were optimists, because they believed that free men of courage could shape their destiny. And in the end, they were realists, because they were right.

At its foundation America was, because of its promise, the hope of the world. Today it remains, because of what it has become, the best hope of all mankind.

This generation of Americans, like every generation before it, will shape its destiny and in helping the world will help itself. For what we, and the world around us, shall be is in our hands. And like those Americans who have gone before us, we shall not fail.

※

## The American Responsibility

Thus the challenges we face are great and complex. But the record shows that we have responded, with confidence and with success. Ours is not the record of a tired nation, but of a vibrant people for whom frontiers have always denoted a challenge, not a limit. We are not weak; we have no intention of letting others determine our future.

America has the strength, resilience, and purpose to meet the modern era on its own terms. We are determined to help shape an international environment which, more than ever before in history, improves the lives and reflects the values of our people.

So let us stop disparaging our strength, either moral or material; because when we do, friends of America grow uncertain, enemies become bold, and a world yearning for leadership loses hope.

Let us tell our people and the world the truth: America will continue to meet the challenges of its time. America and its allies possess the greatest economic and military power the world has ever seen. We have the courage and the self-confidence to prevent nuclear war. We have the vision and the spirit to help shape a more peaceful, more stable world. We have the resources, the technology, the skill, and the organizing genius to build a world economic system together with all nations, developing and developed alike. And this will fulfill the aspirations of all peoples for dignity and well-being.

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The theme of domestic unity came up again in the context of a speech on the Middle East to the Chizuk Amuno Synagogue in Baltimore on May 9, 1976 (#65). He quoted Maurice Couve de Murville saying that the instability in the world was caused not by an increase in Soviet power but by America's internal crisis:

As America makes progress toward all its broad objectives of global peace and well-being, the world is made safer for all countries that rely on us. But if legislative battles and domestic divisions weaken America's leadership, it will not be America alone which pays the price. Our friends and allies will grievously suffer.

Americans and Israelis must work together creatively and boldly in the challenging period ahead. Diplomacy at its best is a process of creation, not of passive reactions to events. For Americans and Israelis above all, who have always shaped actions out of purposes, there is no excuse for political wrangling that in perilous times makes coherent and purposive action impossible.

America has a special responsibility. Never has there been any question about our physical power. As our economy rebounds from recession, there is every reason for confidence about our long-term—and indeed permanent—superiority in the economic and technological strength that is the basis of our military power as well as of our economic welfare. The challenge to us at this point in our history is whether we can restore the consensus and national confidence that can make this power effective for our goals.

I am optimistic. We are not weak; we are only hesitant. It lies within us to remedy our difficulties.

The former Foreign Minister of France, Maurice Couve de Murville, said on the floor of the French Assembly three days ago:

> The instability in the world is above all a result of the American crisis caused by the defeat in Viet-Nam and the Watergate affair, rather than by the increase in Soviet power...

Americans know that when all is said and done, there cannot be peace for one nation; there must be peace for all nations, or all are in jeopardy.

The world looks to us. This is one fact that I have found, whatever continent I have visited—Africa, Latin America, Asia, or Europe. Although we no longer enjoy the preponderant power we once had, we are still the strongest single country and a nation recognized throughout the world for its honesty, its decency and unselfishness. If we persevere, if we use our great moral and physical influence to maintain the balance of power, promote world prosperity, mediate conflicts, and put our considerable weight on the scales of justice—if, in short, we do as we have always done—we will usher in an unparalleled period of progress and peace.

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[N]

On July 6, 1976, soon after the Bicentennial celebra-
tion, HK was more optimistic. In a luncheon speech in
Chicago before the Chicago Council on Foreign Relations
and the Mid-America Committee (#72), HK warned against
the distorting effect of exuberant campaign rhetoric. He
called for a "new foreign policy consensus." On the whole
the tone was thoughtful and upbeat:

Two days ago this nation joyfully and confidently celebrated its 200th birthday. And in a little less than four months our people will go to the polls to elect a President and begin charting our course through our third century.

No two events more vividly symbolize our
contemporary challenge, its hope and its
promise. For 200 years we struggled to build
a nation from a wilderness, a sanctuary for
the oppressed, and a home for all those who
love liberty and believe in man's right to
govern himself. And during those 200 years,
despite occasional setbacks and mistakes, we
have succeeded in vindicating the dreams of
the great men who came together in Philadelphia to proclaim a new nation. At home, we
have created a society more free, just, and
prosperous than any other on earth. And
abroad, no nation has done more to defend
peace, promote prosperity, feed the hungry,
heal the sick, spread knowledge, welcome
refugees from tyranny, and champion the
rights of man.

The past gives perspective to our en-
deavors, pride in where we are, and hope for
what we may become. But the future, as
always, depends on choices which now are
ours to make.

Much will be said in the months between
now and November about the state of our
nation. Some of it will make sense; some will
not. Some of it will reflect reality; some of
it will not—but rather the desire to create a

temporary mood or to capitalize on it.

Let us recall that four years ago we were
told by some that we had become a nation
of potential war criminals, that our military
establishment had passed the bounds of rea-
son and was out of control, that our foreign
policy aggressively invited conflict, and that
we were neglecting the needs of our people.
That was not true then. It is not true now.

Today we are told that we have let our
military position slip to the point that we are
second rate, that we are being pushed
around, and that our government is resigned
to seeking the best available terms. That
also is not true, and the American people
know it. They know we remain far and away
the strongest nation in the world. They know
that America's dedication to peace and prog-
ress is essential to the world's security and
well-being. They learned painfully long ago
that military conflict abroad threatens
American lives; more recently they have
seen how global economic conflict can
threaten American jobs and well-being.

With our defense shield the core of the
security of free countries, with our economy
representing a third of the gross national
product of the entire free world, our actions
and the confidence of those nations who de-
pend on us are crucial for the prospects of
all free peoples. We must avoid a compla-
cency that is unworthy of our challenges.
But equally we must resist a rhetoric of im-
potence which disquiets friends and em-
boldens adversaries.

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The challenges of peace, prosperity, and justice are unending; there are no easy and no final answers. Good intentions alone do not constitute a foreign policy. We must learn to conduct foreign policy as other nations throughout history have had to conduct it—with persistence, subtlety, flexibility, nuance, and perseverance; with the knowledge that what can be achieved at any one point will always fall short of the ideal but that without ideals the search for the merely practical becomes stultifying. We can no longer afford to oscillate between isolation in preservation of our purity and interventionism in pursuit of objectives whose attainment would permit us to withdraw from the world. Foreign policy must be conducted not as a response to domestic passions, or to international crises, but as a long-term enterprise—engaging our best efforts for as far ahead as we can see—of building a better and safer world.

Our national objectives and ideals, if they are well conceived, cannot change every four years or with every new Administration. To pretend that they do, or even that they can, would make American policy itself a major factor of instability in the world.

Whether we call it "structure" or "architecture," whether the process which produces policy is solitary or done by committee, the nation will have to continue to engage itself in managing the transition from the postwar international order based primarily on defense against aggression to a new international system which adds to security the needs of economic cooperation and political consensus on a global scale.

And we must do so under radically altered psychological conditions at home. The generation that undertook the great initiatives of the postwar period was inspired by the recollection of a conflict whose morality was unquestioned and whose outcome was conclusive. The generation that will have to sustain contemporary foreign policy recalls only

wars that appeared morally ambiguous and whose outcomes were profoundly frustrating. Ours is a period much less confident of the ability of governments to manage the great issues of the era.

And yet too much depends on us to permit our commitment to falter. We have physical strength in abundance. We must marshal the vision to put it into the service of our ideals.

The time has come to build a new foreign policy consensus similar in scope but different in content from that which sustained our previous achievements. Democrats and Republicans, Congress and the executive, government and citizen, must once again conduct the foreign policy debate in the spirit of partnership—recognizing that we are not at war with each other, but engaged in a vital national enterprise affecting our future and the world at large. Our electoral process can do much to strengthen our role in the world —both by healing the wounds of the last decade and by forging the elements of a new nonpartisan consensus in foreign policy. This election, whatever its outcome, should be remembered as the time when the American people rediscovered their unity in the formulation and execution of foreign policy.

Despite the domestic turmoil of recent years, much has already been achieved.

* * *

The United States has faced challenge before. No other people could have celebrated its birthday so joyfully or with such optimism about its future. America has always stood for something beyond its own physical strength. The heritage we have celebrated this week is a vision of mankind's most glorious ideals—the equality of all peoples and individuals; the right to life, liberty, and the pursuit of happiness. Only in our free countries, where these principles are secure, do they sometimes seem platitudes; to a world in which the majority of mankind lives without them, they are the burning issues of our time.

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America's success has come from its blend of pragmatism and idealism. Our pragmatic tradition has helped us confront reality, neither blinded by dogma nor daunted by challenge. Our idealism has given us not only principles to defend but the conviction and courage to defend them. In today's world of complexity, we need more than ever a moral compass to steer by, a sense of conviction that enables us to persevere through the stages of the attainable toward the ideal which will always be beyond.

The world no longer offers us the simplicity of detachment or temporary applications of overwhelming power. In a world of interdependence, of unending challenge, and of diversity, we must recognize our permanent involvement. Nor do we have reason for apology or hesitation. We remain the most powerful nation on earth.

And there is much to accomplish together with the other industrial democracies as long as we offer the leadership for which all free nations long. And other nations will join us in collaborative endeavors if they see us—the world's most powerful nation—offering leadership.

So it is time to put an end to our domestic divisions, for they are the principal obstacle to the full realization of our opportunities. We have consumed too much of our substance in domestic strife; we run the risk that in pursuit of such self-absorption we will lower our sights. All great achievements were dreams before they were realities. The truly creative actions do not grow out of fine calculations of expediency and technical analysis. They require a vision which draws men to far horizons.

## The Press

The appeal for national unity was made also to the ladies and gentleman of the Fourth Estate, on whom a great responsibility rested.

One occasion for such an appeal by HK was his remarks at the presentation of the Edward Weintal Award to Peter Lisagor, at the Georgetown University School of Foreign Service on April 9, 1976 (#59). The press had to show some understanding of the complexities of foreign policy and end its corrosive suspiciousness:

> From the end of the war through the mid-60's the national consensus underlying our foreign policy led many in the press to accept the premise that government was serving the interests of the people. Today such consensus exists. The press and those who govern have grown apart, and government is thought by many to be guilty unless it can prove itself innocent.

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One must inevitably wonder about the future state of the relationship between the government and the press. In discussing that question with you today -- from my perspective -- I must emphasize that I make no claim that I have the answer. I will confine myself to stating some issues that concern me.

First, skepticism and scrutiny of public policies and public men are clearly the business of the press. We have seen over the past few years the tremendous strength that a free press brings to our society. But, as with government or any other profession, is it not possible that the skills so useful in dealing with extraordinary circumstances may prove less creative -- less useful -- when applied to more normal circumstances?

We have passed through a destructive and divisive war, and through this nation's greatest constitutional crisis since the Civil War. Just as armies are demobilized when a war is won, is it not now time to ask whether we can demobilize some of the attitudes, assumptions, and techniques that proved so indispensable during Vietnam and Watergate? Have we perhaps fallen into the malaise of retired generals, endlessly re-fighting the battles of wars long past -- battles whose lessons may still prepare us for future conflicts?

Second, the Government, no less than the press, must share a profound attachment to the First Amendment, for the freedoms guaranteed therein have set our nation apart from any other in the past or current history of the world. And when Government seems to retreat from that commitment, it is the responsibility of the press to remind it of its duty.

But I think it is important to remember that endless scrutiny -- without some minimal element of understanding -- can lead to a massive undermining of public confidence in the very institutions of government. Skepticism is healthy, and condemnation often deserved, but no free nation can long exist if its people lack faith in its essential justice. And in an imperfect world one cannot demand perfection as the price of confidence, and insist on one's disillusionment in the face of inevitable ambiguity. For this is the road to national abdication.

I do not claim that the press can or should create faith in government where there is no reason for that faith. But I believe we must recognize that decisions of public officials, in the real world, are often made in circumstances where the facts at hand are ambiguous -- the pros and cons frequently evenly balanced. Unless there is, at some level in the public debate, some minimal degree of understanding -- yes, and compassion -- of the complexities of the issues and of the uncertainties about projecting the future in decision making, we risk bringing to life Cardinal Richelieu's dictum: "Give me six lines written by an honest man, and I will find something in it with which to hang him."

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hird, I do not pretend to know what a newsman should do when a government official presents him with a classified document, even if he knows the motives of his source to be self-serving. The real ulprit, if there is one, is the government official who, having taken an oath of office, then violates that oath -- no matter what his motives -- by leaking classified information. The person to whom that information is passed, on the other hand, has taken no such oath. In fact, his professional obligations run in quite the opposite direction; his duty is to inform the public, to tell the American people what is going on. But let us not, while lionizing the press for doing its duty, forget that usually the source has failed in the performance of his.

fourth, the trend toward the making of news by leak can have some peculiar and misleading consequences. A little over a month ago I have a speech in San Francisco. It was a major attempt to lay out in detail the conceptual basis for our policy toward the Soviet Union. The speech was the product of careful analysis, and was intended to be the definitive public statement of this Administration's position on the issue. Probably because it was unclassified, it attracted only moderate attention.

And no particular reason to be concerned about the oversight until after that followed the leaks about Hal Sonnenfeldt's informal and off-the-cuff remarks to a Chiefs of Mission meeting in London on the same subject. Presumably because of the fascination that seems to derive from dealing with secrets, Sonnenfeldt's comments -- reported in a cable summarizing his remarks -- were promoted to the status of 'Doctrine,' the context in which they were given ignored, and their meaning and significance distorted.

Then, of course, the report of my own remarks to that same gathering of Ambassadors was also leaked. While it has not, as yet at least, led to the creation of a new "Kissinger Doctrine," it has been given more space in the newspapers of record than the San Francisco speech and it has led to much speculation, though much better unclassified versions are available.

In this connection, we have seen a new and interesting investigative technique emerge in the appearance of memoranda of conversation either submitted to Congressional investigations or leaked.

What is the problem? An individual records his version of a conversation. It is, naturally, one-sided; it is not seen by the other party to the conversation; it reflects the writer's perception and state of mind alone; it contains no description of the author's motives; it is likely to reflect a tendency we sometimes see in the State Department to put down what the writer wished he had said, and what he hoped to hear from the other fellow. As Dean Acheson so often remarked, he never saw a memorandum of conversation in which the author lost the argument.

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I had personal experience of this when a certain candidate for state office claimed to have recorded, in an arcane system of code, both his own words and those supposedly spoken to him. Incidentally, as far as the accuracy of the candidate's coded recollections of what I supposedly said to him is concerned, I am beginning to suspect that he lost the key to the code somewhere along the line.

I raise these points not to argue that the fascination with leaked documents has sometimes led the press to do less than justice to information publicly available -- although I believe that to be the case. I raise it for more fundamental reasons.

If there is to be openness within government, if there is to be debate, and if men and women are to have the courage to say what they think and defend what they believe, then they must be permitted some minimum degree of privacy. If every drafter of a cable must expect that he may be called publicly to account for his views, if he believes that he may have to defend himself later in excruciating detail for what he wrote, if every conversation is suspected of being the subject of a memorandum, then meaningful discussion within government will wither and we will be left with a dull and lifeless bureaucracy unprepared ever to take a chance.

Finally, you are all familiar with the ferocious dedication to news gathering which Ben Hecht portrayed in "The Front Page." Many of the attitudes and techniques Hecht saw in an earlier era are now with us again. Investigative reporting is once again the vogue. I do not object to that fact -- at least not too much -- provided there is also an understanding that investigative reporting proceeds from the assumption that there are substantial, new facts to be discovered and brought to the public's attention.

In foreign policy that is rarely the case.

Effective journalism, in the area of foreign policy at least, is not measured so much by the wealth of information discovered as by the weight of superior analysis.

These "Front Page" techniques, applied in the foreign policy field, may seem to succeed. What appear to be new facts may, indeed, be brought forth as more and more classified documents are leaked. But I would contend that too often these are likely to be new only in appearance, and to add little or nothing to the body of knowledge available to the public. In-depth reporting and analysis, on the other hand, can truly serve to educate the nation on the critical issues of the day. A recent series on SALT carried in a Washington newspaper, for example, represented a first class piece of analytic journalism. It was a deeply insightful series, and yet it unearthed not one new "fact" via the use of leaked classified information. No amount of "Front Page" digging could have produced it. Nor could leaked classified documents have done so -- no single classified document with which I am familiar contains the information, much less the insight, contained in these articles. It was, in short, a work of the mind, and we need more of it.

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After the 1976 election, HK addressed the National Press Club in Washington on January 10, 1977 (#80). HK repeated the theme of the need for a new bipartisan national consensus on foreign policy. He hoped the media would feel a shared sense of responsibility:

It is in the nature of foreign policy that problems of world structure cannot be concluded in one Administration. I believe that we have emerged from one of the most trying decades in our history with new maturity, with the foundations of a long-term policy in place, with the world and America more tranquil than we found them, and with considerable opportunities for constructive achievement before us. We are no longer innocent, but neither have we grown cynical. We have reconfirmed our historic responsibility to contribute to the eternal quest of all peoples to live in security and peace, free from fear, oppression, or foreign domination. We must never forget that no other free nation is strong enough or cohesive enough to replace us. If we falter, no one can step into the breach, and hostile purposes and incompatible values will then shape the future of mankind. Without our commitment there can be no security; without our contribution there can be no progress. This is America's inescapable burden; its incontestable glory.

So, as the Administrations change, let us dedicate ourselves to the task of insuring that our common purposes transcend our differences. No matter how strong the foundations we have laid, the challenges confronting the next Administration will be complex, difficult, and painful. There will continue to be, as there have been in the past, many complicated choices to make. And there will continue to be intense dispute over the wisdom of the choices made and the courses that have been set.

Achievement will inevitably fall short of hope and expectation, as it has in every Administration. The new Administration may avoid some of the mistakes we made; it will surely make some new ones of its own. But all of us owe those who carry the burden of responsibility the benefit of the doubt, a healthy understanding for the magnitude of their problems, and compassion for the narrow range of choices available.

Long before I had any expectation that I would be leaving office, I emphasized, perhaps self-servingly, the vital importance of a nonpartisan

foreign policy. I repeat that plea now with equal fervor. The divisions that have characterized the last decade in this country must finally end. The deeds demanded of America in the decade ahead can only be accomplished by a united people and government acting with boldness, perseverance, and vision.

This is the time to build a new foreign policy consensus similar in scope though different in content than that which sustained the post-World War II generation. Americans must once again conduct their foreign policy debates with a recognition that we are, after all, partners in a vital national endeavor on which depends our future and that of the rest of the world. Let us behave during these years so that we shall remember them as the time when the American people rediscovered their unity. For my own part, I wish my successors well. I will do my best to contribute to an informed, constructive, and supportive public dialogue.

You, ladies and gentlemen of the Fourth Estate, have a stake in this enterprise. If I may make a parting request it is to look upon my successor's challenges with some sympathy; to remember that what appears to an outsider as lack of candor may in reality be the best judgment of serious people grappling with events emerging from a fog of confusing reports and putting forward policies which they believe to be right, but which they cannot know to be right until the time for decision is past.

The profound alterations over the past decade in our perceptions of morality and political propriety have affected every aspect of our public life, and they have had a dramatic impact upon the relationship between the government and the press. The days when statesmen and journalists coexisted in an atmosphere of trust and shared confidences have given way to a state of almost perpetual inquest which, at its worst, can degenerate into a relationship of hunter and hunted, deceiver and dupe.

But in its best sense these new attitudes have been—and will be—centrally important to the health and vitality of our democracy.