7. Briefing Memorandum From the Director of the Policy Planning Staff (Lord) to Secretary of State Kissinger1
Strategies for the Oil Crisis and the Scenario for September 28 Meeting
You asked for our views on the overall strategy for the Camp David Meeting September 28. We have developed the attached paper2 which assesses the situation, delineates two alternate strategies, and lays out the scenario for pursuing whichever you select.
The first strategy is essentially that in the paper Tom Enders gave you (Tab A);3 the second is a variant developed in S/P to give you an alternative to consider. Both strategies are predicated on the belief that the oil situation warrants a hard effort to pull the consumers together and to build a firm line with the producers; both call for special consumer conservation and financial solidarity measures like those Enders proposes; and both seek to get the consumers to develop specific economic countermeasures against the producers. The strategies differ essentially on the issue of seeking arrangements with the producers: the first makes no provision for doing so; the second makes preparation for a dialogue with the producers a major element.
It is not, in my view, an easy choice between the two. I am impressed with the seriousness of the situation and the need to avoid faint-hearted stabs at the problem: as to the whole future framework for dealing with resources and like issues in an interdependent world. Moreover, the major consumers must be brought to see these stakes and we cannot let them avoid facing up to the serious choices they impose. But unless your contacts with the Europeans and Japanese to prepare the September 28 meeting argue to the contrary, I am not optimistic about how much stomach they will have for the firm measures we think need to be taken.
For this reason, I lean marginally toward the second strategy as giving us a better chance with the Europeans and Japanese. It offers them the prospect of a dialogue with the producers and presents the development of economic countermeasures as building consumer strength and some negotiating sticks to accompany this. I also think the prospect of a dialogue with the producers would put us in a somewhat [Page 27] better position in dealing with Arab reactions to our strategy and in coping with the Middle East situation this autumn.
I take this view realizing that it somewhat coats the pill for the consumers and risks permitting them to hold on to false hopes and half measures; and it takes some of the edge off our message to the producers. There is also the question, as always, of what we would talk to the producers about in any dialogue, though here I think the attached paper gives a good first answer. I would try to handle these problems by tightly linking the actual convening of any consumer-producer meeting to prior solid agreement among the consumers on conservation and financial solidarity measures, a specific set of proposals to be put to the producers, and a panoply of economic countermeasures, some of which should be implemented before the dialogue with the producers begins.
Turning to the scenario for the September 28 meeting, the chief point I would stress is our proposal that you open the meeting with an analysis of the political context. This will give you the chance to impress upon the attendees the seriousness of the situation and the need for action that faces up to it. The major message that you should seek to convey is that however difficult and dangerous our choices may be now, they are nothing like what they will be if we allow the situation to drift. If nothing is done soon, the temptation to consider military options may gain ground.