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International Monetary Policy, 1969-1972


109. National Security Study Memorandum 7

Source: National Archives, RG 59, S/S Files: Lot 80 D 212, NSSM 7. Secret. NSSM 7 established what became known as the Volcker Group after its Chairman, Under Secretary of the Treasury for Monetary Affairs Paul A. Volcker. The members were Volcker, Fred Bergsten, Dewey Daane, Henrik Houthakker, and Nathaniel Samuels. The Volcker Group was the successor to the Deming Group in the Johnson administration, chaired by then Under Secretary of the Treasury for Monetary Affairs, Frederick L. Deming. From 1969 to 1974 various U.S. Government, foreign government, IMF, and academic papers were distributed, in several numbered series, to members of the Group for their consideration, often at scheduled meetings. A set of these papers is in the Washington National Records Center, Department of the Treasury, Volcker Group Masters: FRC 56 86 30. A duplicate set of Volcker Group papers, bound into folders and indexed, is ibid., Office of the Assistant Secretary for International Affairs Central Files: FRC 56 86 24, The World/l/555 Volcker Group 1969. The papers were most often distributed under cover of a memorandum from George H. Willis, Deputy to the Assistant Secretary of the Treasury for International Affairs. Willis attended Volcker Group meetings and many international meetings on international monetary issues, such as G-10 and C-20 Deputies meetings. Spiral notebooks with his handwritten notes from some of these meetings are ibid., Deputy to the Assistant Secretary for International Affairs: FRC 56 83 26, Willis Notes.


111. Volcker Group Paper

Source: Washington National Records Center, Department of the Treasury, Volcker Group Masters: FRC 56 86 30, VG/LIM/1-VG/LIM/30. Confidential; Limdis. A January 30 draft indicates the paper was drafted by Willis. (Ibid., Deputy Assistant Secretary of the Treasury for International Affairs, Contingency Planning 1965-1973: FRC 56 83 26) Two other papers, VG/LIM/69-3 (“U.S.-U.K. Arrangements for Joint Contingency Planning,” dated January 31) and VG/LIM/69-4 (“Possibilities for Dealing with Situation Created by ‘Aggressive’ Exchange Rate Action by the French,” dated January 31), are attached. The three papers were to be discussed at the Volcker Group’s February 3 meeting. No record of the discussion was found.


112. Telegram From the Department of State to Selected Posts

Source: National Archives, RG 59, Central Files 1967-69, FN 10 IMF. Limited Official Use. Drafted by Thomas O. Enders (E/IMA) and L.P. Pascoe (Treasury), cleared at Treasury by Volcker and Willis and at the IMF by Dale, and approved by Enders. Sent to all posts except Bathurst, Bujumbura, Gaborone, Kigali, Maseru, Mbabane, and Port Louis.


113. Memorandum From the Deputy to the Assistant Secretary of the Treasury for International Affairs (Willis) to the Under Secretary of the Treasury for Monetary Affairs (Volcker)

Source: Washington National Records Center, Department of the Treasury, Deputy to the Assistant Secretary for International Affairs: FRC 56 83 26, Contingency Planning 1965-1973, Sensitive Documents 1-4/69. Confidential; Limdis. Sent through Assistant Secretary Petty. Copies were sent to Daane at the Federal Reserve, Dale at the IMF, and a number of others in Treasury. The memorandum is marked “For information.”


114. Telegram From the Embassy in France to the Department of State

Source: National Archives, Nixon Presidential Materials,NSC Files, Country Files—Europe, Box 674, France, Volume I 1/20-4/14/69. Confidential; Exdis.


115. Talking Paper Prepared in the Department of the Treasury

Source: Washington National Records Center, Department of the Treasury, Volcker Group Masters: FRC 56 86 30, VG/LIM/1-VG/LIM/30. Confidential; Limdis. An attached cover note from Willis to members of the Volcker Group, dated February 19, indicates that page 1 was a corrected copy. A February 17 draft, labeled “2nd draft,” indicates Willis prepared it. (Ibid., Deputy to the Assistant Secretary for International Affairs: FRC 56 83 26, Current Problems and Contingency Planning 11/68-4/69) President Nixon traveled to Belgium, the United Kingdom, the Federal Republic of Germany, Italy, and France February 23-March 2. See Document 116 for a Talking Paper prepared for the President’s use in France.


116. Talking Paper Prepared in the Department of the Treasury

Source: Washington National Records Center, Department of the Treasury, Volcker Group Masters: FRC 56 86 30, VG/LIM/1-VG/LIM/30. Confidential; Limdis. Presidents Nixon and De Gaulle met in Paris on February 28, March 1, and March 2. International monetary issues reportedly were discussed in an expanded meeting on March 1, but no record of that meeting was found. Regarding their final meeting on March 2, see Document 7.


117. Telegram From the Department of State to the Mission to the OECD

Source: National Archives, RG 59, Central Files 1967-69, FN 17. Unclassified. Drafted by Enders (E/IMA), cleared by Rogers (EUR/RPE) and Widman (Treasury), and approved by Enders. Repeated to Bonn, Brussels, The Hague, London, and Luxembourg.


119. Volcker Group Paper

Source: Washington National Records Center, Department of the Treasury, Volcker Group Masters: FRC 56 86 30, VG/LIM/31-VG/LIM/50. Confidential; Limdis. The paper is marked “Treasury Draft.” Another copy is ibid., Deputy to the Assistant Secretary for International Affairs: FRC 56 83 26, Contingency Planning 1965-1973. This paper was presumably the result of discussion at the March 11 Volcker Group meeting; see Document 118.


120. Telegram From the Embassy in Italy to the Department of State

Source: National Archives, RG 59, Central Files 1967-69, FN 10. Confidential; Limdis; Greenback.


121. Telegram From the Department of State to the Embassies in Belgium, the Netherlands, Italy, Sweden, and Switzerland

Source: National Archives, RG 59, Central Files 1967-69, FN 10 4/l/69. Confidential; Limdis; Greenback. Drafted by William Dale; cleared in Treasury by Widman and Willis (in draft), in the Federal Reserve by R. Wood, in the Council of Economic Advisers by Wonnacott (in substance), and in State by E. Heginbotham (E/IMA); and approved by Robert M. Beaudry (EUR/NSC-IG).


122. Memorandum of Conversation

Source: National Archives, RG 59, Central Files 1967-69, POL UK-US. Confidential; Nodis. Drafted by Bergsten. According to the President’s Daily Diary, the meeting lasted from 10:37 to 11:25 a.m. (National Archives, Nixon Presidential Materials, White House Central Files, President’s Daily Diary) The Diary does not record Ambassador Freeman and Bergsten as attendees, but does list John Harris, an aide to the Chancellor.


123. Action Memorandum From the President’s Assistant for National Security Affairs (Kissinger) to President Nixon

Source: National Archives, Nixon Presidential Materials, NSC Files, Agency Files, Box 289, Treasury, Volume 1. Secret. A stamped notation on the memorandum reads: “The President has seen,” and the President wrote: “Excellent analysis.”


124. Action Memorandum From the President’s Assistant for National Security Affairs (Kissinger) to President Nixon

Source: National Archives, Nixon Presidential Materials, NSC Files, Subject Files, Box 309, Balance of Payments. Secret. Drafted by Bergsten.


126. Memorandum From Secretary of the Treasury Kennedy to President Nixon

Source: National Archives, Nixon Presidential Materials, NSC Files, Subject Files, Box 309, Balance of Payments. Confidential.


128. Telegram From the Department of State to the Embassy in Germany

Source: National Archives, RG 59, Central Files 1967-69, FN 10. Confidential; Priority; Limdis; Greenback. Drafted by Widman (Treasury); cleared by Volcker and Willis (Treasury), Heginbotham (E/OMA), and Kornblum (EUR/GER); and approved by Quinn (S/S-O)


129. Action Memorandum From the President’s Assistant for National Security Affairs (Kissinger) to President Nixon

Source: National Archives, Nixon Presidential Materials, NSC Files, Subject Files, Box 309, Balance of Payments. Secret. Drafted by Bergsten. A stamped notation on the memorandum reads: “The President has seen,” and a handwritten notation indicates that it was returned from the President’s office to Kissinger on June 11. The President wrote on the memorandum: “High priority.”


130. Memorandum From Secretary of the Treasury Kennedy to President Nixon

Source: National Archives, Nixon Presidential Materials, NSC Files, Agency Files, Box 215, Council of Economic Advisers. Confidential. Another copy is attached to Document 131.


131. Action Memorandum From the President’s Assistant for National Security Affairs (Kissinger) to President Nixon

Source: National Archives, Nixon Presidential Materials, NSC Files, Agency Files, Box 215, Council of Economic Advisers. Confidential.


132. Telegram From the Embassy in France to the Department of State

Source: National Archives, RG 59, Central Files 1967-69, FN 10. Confidential; Priority; Limdis; Greenback. Repeated to the Embassies in G-10 capitals (sent to the Treasury representatives in Bonn, London, Rome, Tokyo, and USOECD in Paris) and to USEC.


133. Volcker Group Paper

Source: Washington National Records Center, Department of the Treasury, Volcker Group Masters: FRC 56 86 30, VG/WG II/69-14-VG/WG II/69-35. Confidential. The paper is marked “Willis Draft.” VG/WG II/69-24 was circulated to members of the Volcker Group and Working Group II under cover of a July 17 memorandum from Willis indicating the draft paper would be discussed at a 4:30 p.m. meeting of the Group that day, prior to the meeting of the G-10 Deputies in Paris July 23-24.


134. Telegram From the Embassy in France to the Department of State

Source: National Archives, RG 59, Central Files 1967-69, FN 17. Confidential; Priority. Repeated to Bonn, Brussels, The Hague, London, Rome, and USEC.


135. Telegram From the Embassy in France to the Department of State

Source: National Archives, RG 59, Central Files 1967-69, FN 10. Confidential; Priority; Limdis; Greenback. Repeated to the Embassies in G-10 capitals (sent to the Treasury representatives in Bonn, Rome, Tokyo, and USOECD), and USEC.


137. Memorandum From the Chairman of the Council of Economic Advisers (McCracken) to President Nixon

Source: National Archives, Nixon Presidential Materials, NSC Files, Agency Files, Box 215, Council of Economic Advisers. Confidential. This memorandum was sent to the Treasury Department under cover of a September 9 memorandum from Ken Cole. It is attached to a copy of Secretary Kennedy’s September 19 memorandum to the President (Document 138). A September 8 draft, which forms Tab D to Document 139, is identical to the text printed here but without the final paragraph. (National Archives, Nixon Presidential Materials, NSC Files, Agency Files, Box 215, Council of Economic Advisers)


138. Memorandum From Secretary of the Treasury Kennedy to President Nixon

Source: National Archives, Nixon Presidential Materials, NSC Files, Agency Files, Box 289, Treasury, Volume I. Confidential. An attached September 24 note from Haig to Bergsten requested, “as a matter of urgency, a cover memorandum from Henry to the President,” presumably Document 139, to which a copy of this memorandum is attached as Tab E. Another copy is attached to a copy of the September 8 memorandum from McCracken to the President (Document 137) proposing a more forthcoming approach at the IMF and IBRD annual meeting, and this memorandum by Secretary Kennedy is presumably the Treasury Department reply.