36. Memorandum of Conversation1

[Omitted here is a discussion of unrelated matters.]

Economic Situation

President Nixon said that he did not wish to impose on the President’s time but he would like to say a few words about the international monetary situation. He was not an expert in this field as President Pompidou was. As he had told him the previous evening,2 he would hope that there would be close communication between our finance ministers and central bankers on a confidential basis to work out a more stable situation than the one we presently have. On his part he could assure President Pompidou that through an austerity budget we were doing everything we could to cool the U.S. economy so that our inflation would not be a factor of instability which it is at present.

President Pompidou said that he and Secretary Kennedy had talked about this.3

President Nixon said that he had great respect for Mr. Volcker, the Under Secretary, but the man with the most influence in this matter would be Mr. Burns who thinks in more imaginative terms regarding the need for new approaches. He did not know what these approaches should be but Burns had new ideas.

President Pompidou said that if Burns were in Paris in the next few months he would like to see him alone. He had not wished the previous day to speak before all of the Treasury people.

President Nixon said that one must know Burns to appreciate him. He talks slowly but thinks fast. President Pompidou could talk frankly to him as Burns was most discreet. President Pompidou knew that a [Page 92]bureaucracy does not engender new ideas. They generally defend the status quo and try and patch it up. Burns as a top economic and financial expert thinks in innovative terms now although in a few years he will be part of the bureaucracy and therefore we should take advantage of this opportunity.

Europe

President Pompidou said he would like to ask the President to say a few words about Europe. He wanted to know what importance he should give to the statements by Ambassador Schaetzel concerning the fears and even opposition to the European Common Market by the United States.4

President Nixon replied, “None.” In his view it was very important for the European Common Market to develop in its own way. It will be increasingly competitive with the U.S. as the U.K. comes in and it may become a rather serious problem for us in an economic sense. But the President said he took the long view that a strong productive European Community including the United Kingdom is in the interest of world peace and stability. The U.S. would have to pay some costs for achieving this bigger goal and the President did not agree with those who rejected this point.

President Pompidou said he had spoken about this to the Congressional leaders he had received the previous day.4 It was certain that as the European Community developed it may cause economic rivalry. The French would do all they could to insure that it would be open and as liberal as possible so that economic tensions would not become awkward. One should not be too impressed by political figures in France and in the U.S. who are sensitive to the worries of their constituents. Many protested against the French agricultural system which did have many faults, but he could say that the sales of U.S. agricultural surpluses to Europe had doubled since 1958.

President Nixon said that as President Pompidou had said at dinner, if we could only get agricultural subsidies off our books we would be able to give all sorts of assistance to the underdeveloped countries, and added, “some day we must bite that bullet.”

[Omitted here is discussion of Vietnam, military matters, and miscellaneous subjects (scientific and technical cooperation).]

  1. Source: National Archives, Nixon Presidential Materials, NSC Files, Presidential/HAK Memcons, Box 1023, President/Pompidou February 24 and 26, 1970. Top Secret; Sensitive; Nodis. Presidents Nixon and Pompidou met in the Oval Office from 10:40 a.m. to 12:37 p.m. (Ibid., White House Central Files, President’s Daily Diary) President Pompidou visited the United States February 23-March 3. He met with President Nixon in the Oval Office on February 24 and 26; a memorandum of the February 24 conversation is ibid., NSC Files, Presidential/HAK Memcons, Box 1023, President/Pompidou February 24 and 26, 1970. Following his Washington program President Pompidou traveled to Cape Kennedy, San Francisco, Chicago, and New York.
  2. President Nixon gave a dinner at the White House in honor of President Pompidou on February 24, and in turn attended a dinner hosted by the French on February 25. (Ibid., White House Central Files, President’s Daily Diary)
  3. President Pompidou met with Secretary Kennedy at Blair House at 10 a.m. on February 25; see Document 37.
  4. Not further identified.
  5. Not further identified.