169. Telegram From the Department of State to the Embassy in Germany 1
149439. Please deliver soonest following personal message from the President to His Excellency Willy Brandt:
“Dear Mr. Chancellor:
I am tonight announcing a comprehensive program to curb inflation, increase employment, restore strength and confidence in the United States dollar, and improve the international monetary system. This major action is necessary to preserve confidence in the dollar and to maintain an international monetary system which will serve the world’s needs. It was our responsibility to act and we have done so.
I am imposing a 90-day freeze on wages and prices in the United States. I am cutting certain taxes to stimulate consumption and employment and I am sharply curtailing US Government expenditures. I am also levying temporary surcharge on all dutiable imports not already subject to quantitative limitations by the United States, and I have directed that the convertibility of the dollar into gold or other reserve assets be suspended.
I recognize that these actions will be of concern to Germany as they are vital to us.
What we need now is an early agreement on improvements in the international monetary and trading system. I have asked Treasury Secretary Connally immediately to get in touch with your Finance Minister to consult on how we can bring about these improvements.
I am sure you will find that what we have done will contribute to economic expansion in a world at peace.
I look forward to continuing to work with you on these matters of such concern to both of our countries as well as to the rest of the world. Sincerely, Richard Nixon.”
FYI. Under Secretary of Treasury Volcker is proceeding immediately tonight to London and hopes to have a meeting tomorrow at 1500 [Page 469]London time with financial authorities of France, Italy, Germany, Canada, and Japan.2 Arrangements are being made through Treasury-Ministry of Finance channels.
- Source: National Archives, Nixon Presidential Materials, NSC Files, Country Files—Europe, Box 685, Germany, Volume IX 4-8/71. Confidential; Exdis. Drafted and approved by U. Alexis Johnson. Identical cables with this message from President Nixon to certain other heads of government were also sent on the evening of August 15. (Ibid.) The originals of the typed messages sent to the Department of State for transmission are in the National Archives, RG 59, Central Files 1970-73, E 1 US. Circular telegram 149446 to all diplomatic and consular posts, August 16, transmitted a summary of Under Secretary Volcker’s briefing of the Washington diplomatic corps at 10 p.m. on August 15. (Ibid.) The full transcript of Volcker’s briefing was sent to all posts in telegram 156086, August 25. (Ibid.)↩
- See Document 170.↩