Foreign Relations of the United States, 1969–1976, Volume XXIX, Eastern Europe; Eastern Mediterranean, 1969–1972

108. Memorandum of Conversation¹

Budapest, June 26, 1969, 11 a.m.

SUBJECT

• Meeting with Deputy Foreign Minister Bela Szilagyi

PARTICIPANTS

• Deputy Foreign Minister Bela Szilagyi
• American Desk Officer Jozsef Kerekes (part of the time)
• Ambassador Alfred Puhan

REFERENCE

• Budapest 871, 872 and 873²

Minister Szilagyi met me promptly at 11:00 a.m., June 26. I expressed regret that he had been ill but was glad to see him back in his office. He told me that he had had several very severe attacks of asthma which had incapacitated him for work. He felt better now but would have to watch himself.

I told him that I was very pleased to be in Budapest, to assume a relationship with him which my predecessor had enjoyed. He made the remark, “several of your predecessors.” I told him that, as he probably knew, I had been present at the meeting with Ambassador Nagy on May 23 in the Department.³ As he knew, also, the Acting Secretary had welcomed the Hungarian initiative. He was also undoubtedly aware that Assistant Secretary Hillenbrand had handed over a reply to Ambassador Nagy on June 23.⁴ I asked him if he had a copy of the American note. He replied that he did but it was only in Hungarian, whereupon I presented him with a copy of the note in English for which he was grateful. I went on to say that I had indicated my Governmentʼs and my intentions in my accreditation speech to work toward the objective of improving our relations.

I was sure he had noted that he, Minister Szilagyi, would always be welcome in Washington. This was meant sincerely. I could assure him that Assistant Secretary Hillenbrand would be delighted to see him and that he would find a positive reception in the Department of State. I did not regard any talks that we might have as a substitute for an eventual meeting between him and Mr. Hillenbrand. He nodded appreciatively.

Mr. Szilagyi took the initiative at this point and asked me if it would be agreeable to have Mr. Kerekes come in and join us. He said that he thought that in the discussions which we would have we each should have a note-taker. He said he was aware of this practice in the Department of State. He thought that it would be helpful in keeping the record.

I agreed and said that for my next meeting with him I would bring along a note-taker, someone who was a member of my staff, both to take notes and to participate in the discussion if required.

Szilagyi turned next to what he called lack of continuity in the American Embassy. He said he hoped that I would remain here at least three years. He said just as he got to know Owen Jones,⁵ the latter fell ill and was effectively removed from further discussions. Elim OʼShaughnessy had suffered an untimely death⁶ and my immediate predecessor, Mr. Hillenbrand, had been here too short a time. I told the Minister that my stay in Budapest was of course at the pleasure of the President, but I had this morning sent off a telegram accepting an offer to rent my house in Washington for three years.

Szilagyi said he wanted to return to my remarks regarding a possible meeting in Washington. He thought it was too early to make a decision on any possible change of venue, but was agreeable to leaving open the possibility that at some stage of the game Mr. Hillenbrand could journey to Budapest or he to Washington.

Szilagyi said next that he would ask me to keep the discussions we would have as strictly confidential. He said he had had some bad experiences on this point. He said that without blaming anyone it had come to his attention that journalists were occasionally filled in on conversations with him. He spoke of the pressure which journalists can exert on officials of governments. He said that specifically when I arrived in Budapest RFE in announcing my arrival had given a rather specific list of the issues which I proposed to discuss with the Hungarian Government. I assured him that such information had not come from me and he in turn assured me that he recognized that. I told him that insofar as this was possible, the discussions between him and me would be kept confidential. Obviously, he would have to realize that in order for these discussions to be useful I would have to report them to my Government. While I was sure the confidence would be respected, I could not be totally responsible for what happened after they left my Embassy. He seemed satisfied. He added that the talks which he had had with State Secretary Lahr of the German Foreign Office had been impaired by German inability to keep their mouths shut.

Szilagyi said he had learned that US diplomats were frank and direct. He wanted to talk with me in a free, frank way and hoped I would do the same with him. I told him that I could agree to that and that I would not hesitate to tell him the unpleasant as well as the pleasant if that was necessary.

Szilagyi asked me about a remark he said I had made during my Credentials presentation talk concerning model relations. I said I did not use that expression in my formal remarks but had said in a conversation between myself, President Losonczi and Acting Foreign Minister Puja that I saw no compelling reasons why we could not have better relations with Hungary. Indeed, why we could not have model relations with Hungary so far as the United States and Eastern European states were concerned.

Szilagyi next suggested that we should prepare an agenda of all the items which each side believes ought to be discussed in upcoming meetings. He called these lists “non-committing lists.” He thought that at the first meeting we should compare them and reach agreement on what we were going to discuss in future meetings. I agreed to this procedure.

Szilagyi said he thought it would be impossible for the two of us to deal with every aspect of all questions, political, economic and cultural. He thought there might arise a need for expert advice. He thought we ought not to exclude the possibility of meetings between experts. He mentioned Reti in this connection and said he thought I might want to have Mr. Meehan or Mr. Wilgis meet with Reti but that was only a suggestion. He thought that we would want such experts to report back to him and me. I said we did not need to exclude the possibility of meetings between experts.

Szilagyi said the solution of our problems could be a slow and long procedure. There were problems that had been neglected or had remained unsolved for a long time. He did recognize that possibly five or six issues, without identifying them, could be solved by autumn but some would take much longer.

I took this occasion to call to his attention the fact that our note of June 23 had urged upon the Hungarian Government no further delay in the solution of the amortization of the Surplus Property debt. I said I was under instructions from my Government on this point to raise it with him and I was doing so.

Szilagyi looked at me and asked why the United States Government attached such great importance to this issue. I told him there were at least two good reasons: one was that our case was just; and two, that there had been a great deal of discussion of this matter and it seemed to us there wasnʼt much need to have much more. I added that he would agree that to be successful in the solution of other problems we would have to have some movement early to produce the climate conducive to the solution of other problems. This was one problem which could be solved quickly and could produce motion on others.

He said that this had been originally part of the bigger claims issue. Without pursuing this point, however, he promised to take note of our views and to study the problem earliest.

Szilagyi thought that we were in agreement on procedure. I told him he could name the date for the next meeting. He said he had another question to ask. He wanted my opinion on Hungaryʼs chances of improving her trade relations with the United States. In this connection he referred to an alleged statement by the President two weeks ago, saying that the President was against East-West trade. I said I was unaware of such a statement: could he identify it for me? Kerekes said that he didnʼt think it was the President who had made that statement. I said I would be greatly surprised if this were an accurate statement but if he could supply further identification I would try to get him the correct version. I referred him to some testimony on the Export Control Act⁷ where the Administration had decided to proceed with the Act as it now stood. He asked about a report of a Banking Committee. I told him I had seen a report of a Subcommittee of the Banking Committee of the US Senate, favoring some changes in the Act.⁸ He asked me why the Administration took the position it did. I told the Minister that what I was about to say was my personal observation because much of what had happened on this subject had transpired while I was enroute to Budapest. I felt, however, that the question was one first of all whether the Act served our purposes at this time and the Administration felt that it did. I felt also that the question of trade with Eastern Europe depended somewhat upon the general international picture. In other words, if international tensions eased the prospects for changes in this area would improve.

Szilagyi said he thought it would take a long time before Hungary could improve her trade with the United States. I said that I did not wish to be optimistic in this regard for a variety of reasons. One reason was that Hungary did not have too many products in demand in the United States. I felt that although we had noted some progress had been made in trade that it would be wrong to predict an early upturn. Szilagyi said that even if the Hungarians settled the US claims issue he was doubtful that Hungary would get MFN. I told him that I could certainly not assure him that Hungary would get MFN in that case, but Hungary would never get MFN without settling the claims issue. He agreed. Szilagyi said it was a long, uphill struggle but he felt that we ought to work at it if nothing more than to lay the groundwork for an improvement in this field.

Szilagyi ended the conversation by assuring me of Hungaryʼs cooperation and willingness to examine all questions.

When leaving I asked him when he wanted to meet in our first official session. He said that perhaps next week or the week after, but that he was inviting me to lunch next Wednesday and would set the date at that time.⁹

1. Source: National Archives, RG 59, Central Files 1967–69, POL HUNG–US. Confidential. Drafted by Puhan on June 27 and approved by Tihany (EUR/EE). The meeting was held at the Foreign Ministry.
2. Telegrams 871 and 873 from Budapest, June 27, are ibid. Telegram 872, June 27, is ibid., FT 1 HUNG–US.
3. See footnote 2, Document 107.
4. See footnote 3, Document 107.
5. Chargé dʼAffaires, December 1962–July 1964.
6. Chargé dʼAffaires, November 1964–September 1966.
7. The Nixon administrationʼs request for wider authority to set trade policy toward Communist states resulted in P.L. 91–184, the Export Administration Act of 1969. For text of the law, approved December 30, 1969, see 83 Stat. 841. For hearings, see Export Expansion and Regulation. Hearings Before the Subcommittee on International Finance, Committee on Banking and Commerce, United States Senate, 91st Congress, 1st session (Washington D.C.: Government Printing Office, 1969).
8. Not found.
9. Their next formal meeting took place on July 25 when the two men exchanged lists of issues to be discussed. A memorandum of their conversation is in the National Archives, RG 59, Central Files 1967–69, POL HUNG–US. In telegram 947 from Budapest, July 11, Puhan commented that he was “not dissatisfied with the progress we have made thus far,” but noted Szilagyiʼs reputation as a hard bargainer who would demand “value” in return for concessions. (Ibid.)