287. Memorandum From the President’s Assistant for International Economic Affairs (Peterson) to the President’s Assistant for National Security Affairs (Kissinger)1

    • Economic Items for Use in Dobrynin Discussions

At San Clemente you asked for alternative piecemeal approaches that might be used in your meeting today with Dobrynin.2

1. Kama River

I have pressed very hard again to find a separable item and I think the best possibility we have come up with is the Foundry portion (see Tab A).3

It is a reasonably discrete element of the total Kama River project. One could argue whether a decision on our part to authorize participation of a foundry is similarly discrete in the minds of U.S. business. In other words, U.S. businessmen would probably have trouble understanding why the foundry was cleared but nothing else. It may be that we should even consider at some point saying that it is mixed in with other non-economic considerations and we don’t therefore expect it to make economic sense. I am presuming the Russians know the linkage in any event.

We now have three foundry applications that have an aggregate value of $175 million but there is undoubtedly redundancy here. Thus, in actual practice if all three were accepted, we would probably find the total volume significantly less than this.

Even so, if this kind of number bothers you, you can always try getting some Russian purchases of consumer goods and consumer [Page 841] goods manufacturing equipment. You will remember the argument to them might be that anything that appears to U.S. critics to result in a diminution in defense effort (as consumer goods spending might) helps assuage concerns of segments of U.S. public who might feel the Kama River project by itself has too much potential defense content.

In case you have any time for more reading, I show in Tab B4 the current status of the Kama River inter-agency draft you and I agreed we should try to get done soon, including Defense.

Also, included is the latest Mack Truck wire to the Soviets which went out Friday indicating the particular questions they have but keeping it open (Tab C).5

2. Control Data Computer

The other significant pending application is by Control Data Corporation for a Model 6400 computer (quite advanced) for the Institute of High Energy Physics at Yerevan.

This involves COCOM clearance and if you decided to go ahead with it, I would assume you would want to impose the same kind of safeguards we imposed on the British on their recent computer deal with Russia (ICL computers).

Also, you should know that this is not too far along in the inter-agency process but I suppose this could be speeded up.

This strikes me, Henry, as the kind of item you could offer (a) if you were looking for something quite symbolic in the aftermath of the China move, and/or (b) something you could talk about conditionally (i.e. it would take time for example to work out safeguards) in the event you wanted something positive with stalling potential if later it did not seem appropriate.

I have talked to Ed David about this and he has written a very brief memo in Tab D6 that summarizes the situation. Please read it and note he emphasizes inspection safeguards are required but, on balance, he feels it is a reasonable possibility.

3. Petroleum-Hydro-Cracker Technology

While we have no specific applications on this, we do know there has been general Soviet interest in U.S. technology in this field in the past.

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On your desk somewhere, you will probably find a letter for your signature to the President on similar technology to Poland.7

It might even fit your negotiating plans to offer this to the Russians at the same time or even first, indicating you did not want to appear to be discriminating in favor of the Poles. The difference here, of course, is that the Poles have expressed very specific interest in this technology (to me directly and to Dr. Edward David) whereas the Russian interest has been more general. Thus, its leverage potential with the Russians is conjectural.

I hope one or more of these is helpful to you.

  1. Source: National Archives, Nixon Presidential Materials, NSC Files, Kissinger Office Files, Box 66, Country Files, Europe, USSR, Dobrynin Backup (Talkers) [2 of 3]. Top Secret.
  2. According to his Record of Schedule, Kissinger met Peterson in San Clemente on July 16 from 1:49 to 2 p.m. (Library of Congress, Manuscript Division, Kissinger Papers, Box 438, Miscellany, 1968–76) No record of the conversation has been found.
  3. Tabs A–D are attached but not printed. At Tab A is an undated and unsigned paper entitled “The Kama River Foundry.”
  4. At Tab B is a draft memorandum for the President, dated July 16, entitled “Proposed Exports of Technology and Equipment for the Construction of a Soviet Truck Manufacturing Plant Located on the Kama River.”
  5. Dated July 16.
  6. Dated July 19.
  7. Kissinger signed and forwarded the memorandum and attached letter to the President on August 13; Nixon subsequently approved the issuance of the export licenses to Poland. The memorandum is printed in Foreign Relations, 1969–1972, volume XXIX, Eastern Europe; Eastern Mediterranean, 1969–1972, Document 151.