51. Memorandum From the President's Assistant for National Security Affairs (Kissinger) to President Nixon, Washington, November 12, 1971.¹1. Source: National Archives, Nixon Presidential Materials, NSC Files, Box 814, Name Files, Senator Finch. Confidential. Sent for action. Kissinger approved both recommendations for Nixon. Attached but not published at Tab I is the November 10 memorandum from Finch and Peterson to Nixon.

MEMORANDUM
THE WHITE HOUSE
WASHINGTON
ACTION

MEMORANDUM FOR: THE PRESIDENT
FROM: HENRY A. KISSINGER [HK initialed]
SUBJECT: Finch Trip to Latin America

Bob Finch and Pete Peterson have sent you the attached memorandum (Tab I) concerning economic issues which Bob plans to discuss with the Latin Americans. They asked for your approval on two points:

1. Tariff Preferences: Bob proposes to tell the Latin Americans that we will introduce generalized tariff preferences legislation as part of a comprehensive trade package when the climate is right, and that he would like their input. Finch and Peterson note that the Latins will be quite skeptical, but believe this may be the best we can do at this time. They suggest that a new trade package will probably have to wait until after the NEP negotiations are completed and a better unemployment situation prevails. In view of your personal plans, we will have to submit generalized preferences legislation--or possibly as a fallback hemispheric preferences--sooner than that, even if there has to be an understanding that Congress will not act upon it quickly. In the meantime, I recommend that you approve the line that Bob Finch proposes to take with the Latins.

Approve [HK checked for President] Disapprove

2. Expropriation Policy Announcement: Treasury has agreed that no public announcement of expropriation policy should be made until after Finch returns from Latin America. However, Treasury feels it is important to give the House Banking and Currency Committee a commitment that a public announcement will be made within 10 days after the Inter-American Bank legislation is reported out of the Committee. Finch and Peterson recommend that we authorize Treasury to give the Committee such a commitment, but that when the expropriation announcement is made, it should be put in the context of some positive foreign assistance action, such as passage of a new aid bill. I have no objection to this proposal, but will assure that the text and timing of the expropriation policy statement are cleared by you to assure that we minimize any adverse impact on your Latin American plans. I, therefore, recommend your approval of the Finch/Peterson proposal.

Approve [HK checked for President] Disapprove

The Finch/Peterson memo also notes that lifting the surcharge for Latin America is essential to restoring relations. They are concerned, however, that Secretary Connally wants to negotiate trade concessions from each Latin American country in return for lifting the surcharge. I strongly support their view that seeking to negotiate trade concessions from the Latins--with whom we have a huge trade surplus--as a quid pro quo for lifting the surcharge would only add insult to injury and would have far greater political costs than any possible economic benefits we could derive from this approach. We are staffing for you separately the question of how to lift the surcharge for Latin America and will have some recommendations shortly.

The memo concludes by noting that Bob will be consulting with the Latin Americans on the effects of the surcharge, attitudes toward economic aid issues, expropriation policy, and military sales.

Attachment: 11/10/71 memo fm Finch/Peterson