Foreign Relations of the United States, 1969–1976, Volume XXXI, Foreign Economic Policy, 1973–1976

36. Backchannel Message From Helmut Sonnenfeldt of the National Security Council Staff to the President’s Deputy Assistant for National Security Affairs (Scowcroft)¹

London, March 17, 1973, 2100Z.

1528. 1. Following is a summary account of meeting with Pompidou, March 16 which Shultz would like to have brought to the President’s attention.² You may want to use only highlights.

2. We gather Henry was in close touch with Bill Simon on monetary decisions and reported to President. We therefore will not report further on that subject until we return.

A. I transmitted to Pompidou the President’s high esteem and his admonition that, should I have the privilege of a meeting with Pompidou, I listen carefully to his views on monetary matters since the President admires Pompidou not only as a leader of France but as a leading thinker in this general area.

B. Pompidou expressed his admiration for President Nixon and his desire for strong bonds of friendship between France and the United States. He went on to express his concern about statements in the press regarding conflict between the United States and Europe on trade matters and the general thrust in the press that a “victory” over Europe was needed. He raised questions about monetary matters, trade matters, including the general notion of a surcharge, and ended with a question about my visit to the USSR.³ He expressed great concern that President Nixon be careful not to unleash inward-looking and protectionist forces throughout the world, let alone in the U.S.

C. I expressed the general spirit of cooperation to solve a mutual problem that was characteristic of our monetary discussions and my feeling that this general approach had been reciprocated by our friends in Europe.

D. I explained the general objective of the trade bill: to obtain negotiating authority from the Congress so that the President would be prepared for multilateral negotiations. I also explained the general nature of the safeguard system and its relationship to the politics of support for a lowering of trade barriers and for an enlarged trading community. I also reminded him of our approach to monetary problems as expressed at the annual meeting of the International Monetary Fund⁴ and to the relationship of the surcharge to a reformed monetary system, as we proposed it. I referred especially to our problems with the Japanese. He commented that the Japanese were very clever and knew how to negate the effects of changes in exchange rates.

E. I noted the warm attitude of the Russians, particularly Brezhnev’s evident desire that patterns of cooperative relationships develop between the U.S. and the USSR. I characterized my discussions with the Russians as constructive and candid. I told him of our desire for timely information on prospective Russian purchases of agricultural commodities, our efforts to obtain MFN treatment for the Russians and our desire to explore the problems and potentialities of the development of Russian gas and its export to the United States. I expressed our concern about what would be sent to us for U.S. products should a gas deal be impossible to develop. I told him that the President had told me to speak candidly to him in the knowledge that whatever I said would be treated in confidence. This seemed to please him, and he advised me that the confidence would be observed.

F. Pompidou talked at length about the general importance of the United States’ responsibility, not only to look out for its own interest but the interests of the free world. He said that France’s view was the same as he urged on the United States but that France did not have the same power as the U.S.

G. Pompidou went out of his way to make it clear to me that he knew that I had told Giscard on Friday of last week⁵ before the French election that we would have nothing to say about gold on that occasion. I told him that our position had not changed and we expected the subject would come up before long.

H. He asked about discussions with the Russians about gold, and I told him there had been none, except that one member of our delegation had asked one of the Russians how much gold they produced in a year—and he had been told that this information was not available. Pompidou laughed.

I. Pompidou returned several times to his desire for a monetary system based on par values and referred to the unpublished memoir of the Azores meeting.⁶ He characterized his view of a good international monetary system as one providing for “stability without rigidity.” I mentioned our position taken at the IMF, which supported the general idea of a par value system with flexibility in the adjustment process and emphasized the importance of reform in the international monetary system.

J. The conversation was friendly and probing throughout. He expressed repeatedly his admiration for President Nixon and his desire for cooperative relationships between France and the United States and between Europe and the United States. End of notes

1. Source: National Archives, Nixon Presidential Materials, NSC Files, Box 424, Backchannel Files, Backchannel Messages—Europe—1973. Secret; Immediate.
2. On March 19, Scowcroft sent the President a memorandum reporting on Shultz’s meeting with President Pompidou. (Ibid., Box 953, VIP Visits, George P. Shultz (Europe & USSR), March 8–22, 1973 [& September–October])
3. Shultz was in Moscow March 11–14.
4. See Document 1.
5. March 9.
6. President Nixon and President Pompidou met in the Azores on December 13 and 14, 1971, where they discussed international monetary policy. See Foreign Relations, 1969–1976, volume III, Foreign Economic Policy, 1969–1972; International Monetary Policy, 1969–1972, Document 219. The “unpublished memoir of the Azores meeting” is apparently a reference to the undated paper agreed by President Nixon and President Pompidou at the end of their meeting, entitled “Framework for Monetary and Trade Settlement.” See ibid., Document 220.