Foreign Relations of the United States, 1969–1976, Volume XIII, Soviet Union, October 1970–October 1971

242. Memorandum From Ernest Johnston of the National Security Council Staff to the President’s Assistant for National Security Affairs (Kissinger)¹

Washington, May 27, 1971.

• SUBJECT
  • Export of Gleason Machinery to the Soviet Union

Secretary Stans has written to ask that you send him formal notification of the decision to issue an export license to the Gleason Company for the sale of truck manufacturing machinery to the USSR.² This should be done promptly so Commerce can in fact issue the license.

I assume that the decision has already been made by the President, but I have nevertheless drawn up a memorandum to him in case you believe it necessary. I also presume that you see no need for any prior notification to Secretary Laird.

In line with your telephone request,³ Secretary Stans has also proposed that further licenses be authorized for the export to the Soviet Union of $64 million of truck manufacturing equipment for various projects other than the Kama River truck project. He considers these the least strategic of the pending license applications. You had asked him for a proposal for $40 million, but he argues that there is no rational basis for subdividing the $64 million, since the equipment is all so similar and so close to that covered by the Gleason application.

I believe that Secretary Stans’ request is reasonable, but I have nevertheless asked Commerce to come back with some proposal for differentiation within the $64 million, in case you believe that the $40 million is an absolute limit. You could now approve the entire $64 million, or you could await the differentiated package and then decide.

Formal notification on the Gleason case should not wait, however, since Gleason has already lost part of the sales because the Soviets were tired of waiting. An additional reason for moving fast is that the matter will shortly leak. Governor Rockefeller has already called the Gleason Company and claimed some credit for the decision, and he will undoubtedly talk to others.⁴

As a result of your telephone call to Peterson, he now believes that the current decisions fit in well with the small group you and he decided to establish to look at a possible scenario on further relaxation of the trade controls. (See Peterson’s note at Tab IV.)⁵ I am working closely with the group.

Recommendations

1. That you send to the President the memorandum at Tab I, or if that is unnecessary, that you sign the memorandum to Stans at Tab II informing him that he may issue the Gleason license.

2. That you inform Secretary Stans he may issue licenses for $64 million in truck manufacturing equipment, which you may do by signing the memorandum at Tab III (rather than the one at Tab II) approving both the Gleason case as well as the $64 million.⁶

Approve

Disapprove, prefer to await the Commerce breakdown before deciding this issue.

1. Source: National Archives, Nixon Presidential Materials, NSC Files, Kissinger Office Files, Box 66, Country Files, Europe, USSR, The Gleason Case. No classification marking. A copy was sent to Sonnenfeldt. Haig initialed the memorandum, indicating that he had seen it.
2. Attached but not printed is a May 26 memorandum from Stans to Kissinger.
3. See Document 230.
4. Kissinger called Rockefeller at 2:40 p.m. on May 25 to report the approval of the permits for Gleason Gear Company, located in Rochester, New York, to sell trucks to the Soviet Union. The conversation included the following exchange: “K: I thought you might want to call them and take the credit for it. R: Aren’t you nice. K: Could you wait until tomorrow morning? I have told no one here yet. We will tell them this afternoon. I thought maybe you want to call and say because of your intervention this was approved or whatever you want to say. R: You are great. My friend Henry did it again.” (National Archives, Nixon Presidential Materials, Henry Kissinger Telephone Conversation Transcripts, Box 10, Chronological File)
5. Attached but not printed is an undated note from Peterson to Kissinger.
6. Tabs I–III are attached but not printed. Rather than forward the draft to the President, Kissinger approved on his behalf the memorandum to Stans attached at Tab III. The text of the memorandum, dated May 28, is as follows: “The President has reconsidered his previous decision and has now decided to approve the application by the Gleason Company for the export of gear making machines for truck manufacture to the Soviet Union. You may also approve the additional pending applications for export of $64 million of truck manufacturing facilities not related to the Kama River Project.” According to an attached correspondence profile, the memorandum was “temporarily held, but released by Gen. Haig, PM, 1 June & hand carried.” See Document 248.