51. Letter From President Nixon to French President Pompidou 1
Dear Mr. President:
Your letter of June 25 further reviewing the monetary and economic issues we touched on in Reykjavik2 is most welcome. And while we will be giving careful attention to the matters you have raised, I wanted to send you this interim reply as soon as possible.[Page 189]
I, too, believe substantial progress has been made toward reaching a consensus on certain of the basic principles that should underlie the international monetary order. At the same time, much remains to be done in defining those principles more precisely. We need, first, to be sure that the developing consensus reflects substantive agreement and not merely vague verbal formulas, and then proceed to the task of implementing the principles in the most effective way. I am hopeful that we will be entering into this phase of the work promptly. The efforts of the United States will be directed toward that end.
In this connection, I share your concern that the present lack of confidence in the monetary order, and the visible absence of clearly defined monetary rules, could become much more serious should the underlying economic situation in our countries deteriorate. For this reason, I do not underestimate the urgency of the task of reform before us.
At the same time, during this interim period, the emphasis you place on national efforts to deal with inflation—and I would add, on progress toward international balance of payments equilibrium—seems to me entirely right and appropriate. Indeed, I see no other way we can restore stability and confidence to the international monetary order, whatever the specific rules of the system.
Your views on the Soviet Union and its relationship to the monetary system are most interesting. The reconciliation of the practices of a state-trading economy with the market-oriented systems of the Western world presents both practical and conceptual difficulties, but you are quite right in emphasizing the relevance of this problem to our efforts.3
With respect to world agriculture trade, it is of the utmost importance that during the present critical period we understand one another’s problems and not allow short-term difficulties to prevent us from pursuing constructive long-term objectives.
You have also raised a number of important suggestions for a cooperative effort to deal with issues relating to agriculture that will warrant our careful attention. As you know, our traditional view has been one of skepticism toward such agreements, based on the view that they might unduly interfere with world agriculture markets and on the unworkability in times of stress of agreements based solely on price. I believe, however, that while agreements of this type raise a number of questions, it would be very useful to explore in earnest the possibilities of greater cooperation or agreements in areas in which they are to [Page 190]the mutual advantage of producing and consuming nations, including the developing nations. In this respect, I would very much appreciate further details on the types of agreements and cooperation you envisage. I can assure you that these will be studied very carefully by this Government.
In closing, Mr. President, let me emphasize the importance I attach to our personal communications on these matters.
With warm personal regards.
- Source: National Archives, Nixon Presidential Materials, NSC Files, Box 752, Presidential Correspondence 1969–1974, France Pompidou, 1972. No classification marking.↩
- Document 43.↩
- The second, third, fourth, and fifth paragraphs of this letter reflect verbatim the revisions proposed by Shultz, noted in footnote 3, Document 47.↩
- Printed from an unsigned copy of the letter. The NSC correspondence profile indicates that the President signed the letter on August 8 and that it was dispatched the following day. (National Archives, Nixon Presidential Materials, NSC Files, Box 752, Presidential Correspondence 1969–1974, France Pompidou, 1972)↩