PR #481-A

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nuclear war would be an extraordinary calamity.
Therefore, we are attempting to create a situation
where we will not give up our vital interests, but where
we will also not unnecessarily run the risk of confrontation;
where we give an opportunity to the Soviet Union to pursue
a more moderate course but where, when challenged, we act
with great firmness, as we did at the time of the building
of a submarine base in Cuba, as we did during the Jordan
crisis of 1970, as we did during the Middle East alert
of 1973.

We must have a military strength which does not
tempt aggression. Without that, no policy of coexistence,
relaxation, is possible. But, beyond that, we must have a
diplomacy that gives an opportunity for settling disputes
by peaceful means. And we have the problem of balancing
incentives and penalties for the Soviet Union in the
correct way.

Now, there are endless disputes of what the correct
balance of incentives and penalties is. I, for example, do not
believe that economic relations should be conducted for their
own sake. I have always believed that they should be linked
to progress on foreign policy issues.

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Now, on the Helsinki Declaration, there was
a great deal of -- there were many misconceptions. One,
for example: It was not primarily an American show.
It was agreed to by 34 heads of
government, or 34 governments; and, in fact, the United
States did not play the dominant role in shaping it.

Secondly, the Helsinki Declaration recognized
nothing that had not already been accepted in previous
international conferences to which we were a part.

Thirdly, insofar as there was anything new
in the Helsinki Declaration, it was in the area of human
rights and human contacts-- not as far as you would wish it
but, nevertheless, there were formal declarations.

Now, our view with respect to human rights has
been this: We have believed that we could be more effective
by quiet, undramatic representations than by turning them
into tests of prestige. And I think our experience with
Jewish emigration proves this. We had increased the
emigration from 400 in 1969 to 38,000 in 1973, when by making
it a formal test it dropped again to 10,000. But this is
a question of tactics; this is not a question of objectives
or purpose. And our test over the next decade is whether

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we have the strength to pursue both a policy of
relaxation of tension and keep up our military defenses
whether we are prepared to be flexible in our diplomacy
and yet firm in our purposes and avoid oscillating between
extremes of intransigence and extremes of conciliation --
which had been the case in previous periods.

This is what I would define to be the basic
problem.

GOVERNOR MANDEL: Governor Wallace of Alabama.

GOVERNOR WALLACE: Mr. Secretary, after the
unfortunate conclusion of the matter of Indochina, do you
feel that the United States now can afford to give up
control of the Panama Canal?

SECRETARY KISSINGER: On the issue of the Panama
Canal, the question is, what is meant by control of the
Panama Canal and how we define our vital interests in
relation to the Panama Canal.

The United States must maintain the right,
unilaterally, to defend the Panama Canal for an indefinite
future, or for a long future. On the other hand, the United
States can ease some of the other conditions in the Canal
Zone.

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Our problem with respect to the Panama Canal
is this: how do we best defend our defense requirements
that are vital in the Panama Canal area? Do we do it
most effectively by digging in; turning Panama into a
potential area of guerrilla conflict, backed by all of
Latin America; and turning it into an issue of permanent
confrontation between all of Latin America and the United
States in which military force may have to be used for an
indefinite period. Or is it possible to make arrangements
in which our defense interests can be maintained for
many decades and our operating interest can also be maintained
for several decades and thereby defuse the immediate
situation?

Nobody is in favor of turning over our defense
of the Panama Canal, and nobody is in favor of turning
over the essential operating requirements. What we are
talking about is whether we can develop a status for the
Panama Canal--and we're not sure yet that this can be
done--that meets our essential defense requirements and
avoids a situation in which we may have a Viet-Nam type
situation in Central America for the indefinite future
backed by all of Latin America.

If we can find an honorable way of doing it, we

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would like to explore it. As we explore it, we will
consult closely with the interested members of the
Congress; and there will not be any secret negotiations
that are sprung on people unexpectedly. This is really
the issue. We are in the process of exploring it, and I do not
know whether it is possible to achieve what I've described.
If it isn't, then there can be no agreement.

GOVERNOR MANDEL: Governor Godwin of Virginia?

GOVERNOR GODWIN: Mr. Secretary, I was wondering if you could comment — if it would be appropriate for you to make any comment—on what impact, short-termwise or longer, that the Soviet-American negotiations, in reference to our export of wheat and their making available to us oil, would have on our energy situation.

SECRETARY KISSINGER: I would like to stress
that the negotiations on grain and oil are technically
separate negotiations; they are not organically linked,
though there is a conceptual connection between the two.

Our interest in a long-term agreement on grain
is to prevent these fluctuations in Soviet demand, which
can have a profound effect on our prices and in which the Soviet
Union enters our market only in periods of severe

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shortage in the Soviet Union.

So we would like -- and we are in the process of negotiating -- a longer-term agreement, which would at one and the same time stabilize prices in the United States by giving our farmers an opportunity for long-term planning and put a ceiling on what can be bought in periods of difficulty in the Soviet Union.

With respect to what is available in terms of energy from the Soviet Union, I do not think it would have a decisive impact on our energy situation but it would have a symbolic impact. And, therefore, we are pursuing the negotiations.

GOVERNOR MANDEL: Governor Edwards, South Carolina?

GOVERNOR EDWARDS: Mr. Secretary, just prior to your speech, Admiral Zumwalt said that the Russians were using economic factors to their benefit and that they had participated in urging the unity of the OPEC nations -- that they had urged the embargo and had urged the OPEC nations to quadruple prices and raise prices a second time and promise them help, military aid in case of need, and urge the OPEC nations to remove their

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assets from free world banks. Could you comment on the
part that you feel the Soviet Union played in our energy
crisis with OPEC?

SECRETARY KISSINGER: Well, I don't want to disagree with the Admiral, with whom I was associated for many years in Washington. I have stated that I recognize that the Soviet Union is impelled by ideological hostility. I do not doubt that Radio Moscow from time to time makes the claims that were mentioned. At the same time, in terms of systematic policy, I am not aware that the Soviet Union has formally or systematically made the suggestion. I am aware of occasional radio broadcasts from Moscow to selected Arab audiences that use some of these arguments, but so far the Soviet Union has benefited from the OPEC increase; but I think we should not exaggerate the Soviet influence by saying that they have engineered it.

What has happened has been to the advantage of the
Soviet Union, but it has not been the result of Soviet
policies. It is much more due to practice organic to the
Middle East and, therefore, more manageable within the
context of our relationship to the Middle East than as
an aspect of East-West relations.

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GOVERNOR MANDEL: Governor Blanton, Tennessee.

GOVERNOR BLANTON: Mr. Secretary, I want to express my appreciation for your attending this Conference. And I would like to ask you: In the recent peace agreement between Israel and Egypt, besides the technicians, how much money did it cost us; and how is it split between the two?

SECRETARY KISSINGER: Well, with respect to the agreement between Egypt and Israel, first of all, if implemented -- and if we can ever keep everybody quiet for a few weeks, it may even get implemented (laughter) it will represent the most significant step towards peace that has been taken in the history of the Arab-Israeli conflict. And our own obligations with respect to it should be seen in that context.

Now, with respect to what it costs us: since we had not computed exactly what we would have given without the agreement, I cannot give you an absolute figure. But I think it is important to keep in mind that substantial aid for Israel has been a part of annual appropriations, quite independent of this agreement.

For example, last year something like 2.5 billion

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dollars were appropriated for Israel -- partly
to pay for the cost of the 1973 war, and partly to
pay for their other necessities.

Secondly, prior to the agreement, 76 Senators
wrote a letter to the President pointing out that the
assistance to Israel should be computed on the basis of
Israel's needs and not on the basis of any political
considerations; and Israel had submitted a request of
2.59 billion dollars before the agreement.

Now, we have not yet settled the exact figures that
will be submitted to the Congress, but it will be below
$2.59 billion. It will be in the area of $2.2 billion, $2.3 billion.
And, therefore, on that level, you could not prove that there
was any additional sum that has been given as a result of
the agreement, though I assume this is simply very hard to
compute, but we're talking about modest sums.

With respect to Egypt, here is the most significant
Arab country; a country that was substantially close
to the Soviet Union in 1972 and '73; that has now
put more of its reliance on the West. It has chosen the
path of moderation and peace. And, therefore, we feel that
it is symbolically of great importance that the United States

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contribute to an opportunity of economic -- not
military -- development of Egypt.

There again, we have not made a formal agreement
with Egypt. We had planned to increase our economic
aid to Egypt, in any event -- even without the agreement.
And there, too, it may involve a slight
increase over what we had planned. But if you are asking
about the additional sums that the agreement cost us, we
are talking of a few hundred million dollars; we are not
talking about huge sums.

GOVERNOR MANDEL: Any other questions?

Governor Bond of Missouri.

GOVERNOR BOND: Mr. Secretary, what would you
say are the long-term and intermediate-term prospects for
our agricultural exports -- particularly with the OPEC
nations -- or should we be looking to this --

SECRETARY KISSINGER: I didn't hear the beginning
of the question.

GOVERNOR BOND: I'm concerned about our agricultural
exports. Several of the states here represented are very
heavily involved in agriculture. We're interested in knowing
what the potential would be for expanding America's export of