153. Memorandum From the President’s Special Assistant for National Security Affairs (Bundy) to President Johnson1

This folder deals with the tough problem of decisions on export licenses for the Soviet Union which will come before the National Security Council at noon on April 16.2

The administrative heart of this problem is that responsibility is shared by departments which have sharply different views, and that in the last three years no one short of the President has had authority to make clear-cut decisions. The Secretary of Commerce has the immediate statutory responsibility, but the instinct of Luther Hodges was often different from that of others, and it became necessary to appeal individual cases over and over again to President Kennedy. The President in turn preferred to take it case by case, and indeed no blanket instruction could [Page 453]possibly be issued that does not leave individual cases open for individual judgment.

The difficulty is that each sale of nonstrategic items involves a balance of the value of the Soviet Union as against the commercial value to the United States. And each of these estimates in turn is affected by whether one thinks that peaceful trade with the Russians, in and of itself, is a good thing. In any given case, one can always predict the reaction of any individual more from his basic attitudes than from the evidence presented. The close cases are always open to subjective judgment.

Ideally, we ought to have a general review and reach a new basic and solid policy, but this is not the year for that, and nobody really thinks that we can put ourselves in the position to have basic negotiation with the Russians in the next few months. Therefore, the real question is how to handle a relatively small number of controversial items between now and November.

My suggestion is (1) that you listen to argument in the NSC from State, Commerce, Agriculture and Defense, (2) that you then state your own basic attitude, and (3) that you announce that you expect to summarize these basic views in an appropriate memorandum, which will also indicate the procedure which you wish to have followed in meeting these general rules.

McG.B.

P.S. My own judgment, for what it is worth, is that the right way to deal with these cases is to approve industrial licenses much more broadly than Commerce wishes to do. I do not agree with the argument of Agriculture that a few advanced technical tools will solve an otherwise insoluble problem. I do not agree that we can or should try to negotiate political concessions in return for straight commercial deals, and I think our manufacturers should be required to bargain for their own licensing agreements, if necessary (though they won’t get much). Except in the field of strategic goods, there is nearly always an alternative supplier somewhere in the Free World, and I think our restrictive practices hurt us without hurting the Soviet Union. I have heard you speak of your general support for peaceful trade, and I think these are cases in which that principle can safely be allowed to govern.

  1. Source: Johnson Library, National Security File, Subject File, Trade, East-West, Vol. I [2 of 2], Box 49. Secret.
  2. Reference is to four tabs, not attached to the source text but to another copy of the memorandum. They are identified as follows: A. Cabinet Positions; B. Pending Cases; C. Kennedy Position; and D. Eisenhower Policy. (Ibid., Memos to the President, McGeorge Bundy, Vol. 3, Box 1)