[Page 998]

334. Memorandum of Conversation1

SUBJECT

  • Meeting between President Nixon and Prime Minister Heath

PARTICIPANTS

  • President Nixon
  • Prime Minister Heath
  • Sir Burke Trend
  • Henry A. Kissinger

After an exchange of pleasantries, the President asked Prime Minister Heath about the recent electricity strike. The Prime Minister said that the strike was broken because the people turned against the electricity workers. They didn’t say what they normally say, i.e, “Stop inflation, but pay more.” Rather, there was a real case of public ostracism of the electricity workers, so that they finally caved.

The President asked what the young people were thinking. The Prime Minister described his economic strategy in relation to the younger voters. He said, “A small cut in income taxes is not impressive enough for them. They are getting so punch-drunk with taxes that nothing but a big cut is enough. This has been compensated for by a slight rise in the cost of social services, especially a rise in the cost of mental hospitals and schools.”

The President suggested that we proceed with the agenda. Prime Minister Heath gave a long exposition in which he said he would like to begin with the European Community. He thereupon presented a highly technical analysis of outstanding economic issues. His strategy was to get Britain into the Common Market first, and to use the argument that Britain would then be able to take our side in the Common Market. At the same time, he made it pretty clear that Britain would not make any concessions to the United States view prior to going into the Common Market, partly because they did not want to appear to be an American Trojan Horse.

Talking about protectionism, the Prime Minister said Britain was in a bad position to raise the issue since the community tariffs were [Page 999]lower than British tariffs. But he couldn’t see the community going protectionist in any case and with Britain in the Common Market, the chances were probably nil. The same was true of agricultural policy. In short, Prime Minister Heath argued, “We can best defend your interests inside the Common Market and should not pay a price to you before we get in. The best reason, though, for our entering the Common Market is political, and this is why you were for it to begin with.”

The President said, “The problem is what price you are going to have to pay to get in.” Prime Minister Heath replied, “This is correct, but this is very hard to quantify.” The President said, “The British have the political and diplomatic skills to make Europe into an entity. There are some in this country who don’t want you to go in because they are afraid of Europe, but Europe is essential for the balance of power. As for protectionism, we have a serious problem here. Many pressure groups in this country are for protectionism. The strongest pressure, of course, comes from agriculture. They have many lobbyists and half of the Senators are from farm states. If the Senate gets the impression that, as a result of the Common Market negotiations, agriculture is disadvantaged, they will turn protectionist, and then we’ll all be in trouble because the agricultural Senators have been the ones who have been carrying the case for a liberal trade policy.”

The President then explained our attitude toward the Trade Bill before the Senate. “What makes the issue so complex for us is the textile issue.” For all these reasons, he urged the Prime Minister to be cautious on agriculture.

Prime Minister Heath said there are two problems—one is UK policy; the second is the later Common Market policy. The present British system substitutes private for public money. The system isn’t important, but the price level is. If we don’t raise the price level, the British farmers won’t increase production and imports then will not suffer. It will be just a substitution of private for public money; this is not a change in the direction of protectionism but a change that enables us to get more easily into the Common Market.

The President then asked Prime Minister Heath about the German situation. The Prime Minister said, “Our last message is that Brandt has written a letter explaining the situation with respect to Ostpolitik.” The President said, “My view, which I’ve often expressed to every German political leader is this: it’s a mistake to risk real friends for new friends. Everything ties into the NATO situation. Our position in a nutshell is this: massive retaliation was viable in the 50’s, but the viability of this policy under conditions of nuclear parity is questionable. A conventional capability is essential to prevent adventures. It is essential for Europeans, therefore, to improve their capabilities. We have taken a strong stand in Congress and before our public that the conventional [Page 1000]forces should be strengthened. I don’t want European dollars to subsidize our forces. We do not encourage Ostpolitik, but we do not oppose it.” He then asked Dr. Kissinger for his comments.

Dr. Kissinger said we have to distinguish between the things that have already happened in Ostpolitik and the longer term danger. What has happened up to now is not dangerous. What the long-term change may be is another matter.

Prime Minister Heath said he was opposed to a Summit Conference on Berlin which had been raised in Brandt’s letter or even to a permanent conference on Berlin. The President said, “We better keep a hand on it. The Russians have a negotiating position now where it is all for them and nothing for us.” The Prime Minister said, “The probing is being stepped up and, until it is stopped, we won’t really know.” The President said, “There are no plans now for a possible Summit Meeting.” He said, “I told Gromyko that at a European Security Conference, they’ll talk about Europe but not about security. We had to reject an ABM agreement only in order to keep pressure on offensive weapons. But we shouldn’t go to the other extreme. There shouldn’t be a period of extreme coolness. I don’t think they have a clear design, but they go back and forth. We reacted strongly to the Cuban thing.2 They react when we react strongly. It is very salutary to take the strong position we want to take on NATO because it will show the Soviets that things are not going their way. The defense budget will be bigger than some anticipate.

The President then turned to Africa. He said, “I want to be quite direct about Africa. We will do nothing to embarrass you, and we will not embarrass the Portuguese either, in those areas.3 We won’t act like demigods about our position. In the political context, whatever decision we make won’t be affected by our domestic politics. On the other hand, we cannot support you. We can only not embarrass you.”

Prime Minister Heath said, “The Soviets seem to have a clear design to achieve strategic superiority and SALT seems to be being used to try to get an advantage.” The Prime Minister then asked, “What if they service submarines from Cuba?” The President said, “There’ll be a confrontation.” The Prime Minister asked, “How about killer submarines?” The President said, “We are obviously unable to say this now.”

Prime Minister Heath next asked about NATO proposals on mutual balanced force reductions. The President said this was under study.

Prime Minister Heath continued, “We should be constructive toward Middle East talks. Jarring is a post-office box. Otherwise, we [Page 1001]will just elicit extreme positions. The difficulty with the Israelis is that internally they can’t agree on what to accept. What we should do is work out options for getting a settlement. The Israelis won’t state what they mean by secure frontiers. There is perhaps a better chance of getting the UAR to be reasonable and I believe that Hussein would be prepared to go quite far in getting a solution. Perhaps Jerusalem is something that can be worked out.”

The President said, “The other side of the coin is—What does anyone else have to offer? Jarring can keep the post-office box open and produce a stalemate. The world ‘impose’ drives the Israelis up a wall, so we are at dead center about specifics. We are fresh out of ideas. Looking down the road, let’s each continue to examine on a private basis where we go.”

  1. Source: National Archives, Nixon Presidential Materials, NSC Files, Box 1023, Presidential/HAK MemCons. Secret; Eyes Only. The meeting took place in the President’s office. An edited version of this memorandum of conversation was provided to the Department of State. It is ibid., RG 59, Central Files 1970–73, POL UK–US. Heath visited Washington December 16–18. For texts of public statements by the President and Prime Minister, see Public Papers: Nixon, 1970, pp. 1142–1143, 1148–1151.
  2. Reference to the Cienfuegos crisis. See footnote 7, Document 329.
  3. Reference to the British decision to sell arms to the Republic of South Africa. Portugal had conducted a raid against Angolan insurgents using Guinea as a safehaven.