435. Memorandum From the Director of the Office of Emergency Preparedness (Lincoln) to President Nixon1
- Resumption of Commercial Sales of Stockpile Tin
- Secretary Rogers’ memorandum to you, same subject, dated August 20, 1970
Secretary Rogers has proposed a further delay of up to 90 days in sales of excess stockpile tin, during which time he proposes that we work out arrangements and proceed with the sales.2
Having been charged by you to proceed with actions to obtain receipts of $750 million from the stockpile in FY 1971,3 I offer the following comment on this proposal:
- With all due respect for the concern of the Department of State and Ambassador Siracusa about the situation in Bolivia, I am not fully persuaded of the need for appreciable further delay. Since the beginning of this Administration, we have deferred tin disposals in April and September 1969 and in April 1970 because of unstable situations in Bolivia. After reducing the proposed commercial sales from $54 million to $23 million, we obtained on June 5, 1970, the agreement of the Bolivian Government not to make more than pro forma objections to our sales. Although the political situation in Bolivia is unstable, I am inclined to question whether it is sufficiently serious to preclude our sales, and whether it is likely to become appreciably more stable in the foreseeable future.
- I believe 90 days is too long a delay, in view of current tin prices and of the approaching Tin Council meeting in October. The price of tin, probably as a result of speculation based on our evident delay in selling tin, has again risen on the London Metals Exchange, to $1.69 a pound. A Tin Council meeting in October is expected to try to establish the present high price as the normal price, which would be costly to the United States and inflationary. If we do not sell beforehand, under these circumstances, we probably will receive complaints from industry, and perhaps from [Page 1071] Congress. It should be noted that a 90 day delay would also extend beyond the Congressional elections.
- The delay on tin disposals because of Bolivia—now known in the trade as the “Bolivian freeze”—is impairing other stockpile disposals. In the July meeting of the UNCTAD Commodities Committee in Geneva,4 Bolivia taunted the rubber-producing countries, especially Malaysia, for weakly accepting US disposals. Malaysia has subsequently raised questions about US rubber disposals, and has cited the Bolivian case. In recent weeks, a number of other countries have also protested US stockpile disposals. Although this is not unusual, it may be due in part to the holdup in tin disposals because of Bolivia.
For the reasons given above, I recommend that we proceed with the tin disposals as soon as possible, and in any event no later than October 1.
- Source: National Archives, Nixon Presidential Materials, NSC Files, Subject Files, Box 396, Stockpile. Secret. Copies were sent to Kissinger, Flanigan, Trezise, Meyer, and Shultz.↩
- Document 434.↩
- See Document 422 and footnote 1 thereto.↩
- Not further identified.↩
- Printed from a copy that indicates Lincoln signed the original.↩