677. Memorandum From the President’s Deputy Assistant for National Security Affairs (Haig) to President Nixon, Washington, July 5, 1971.1 2

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MEMORANDUM
THE WHITE HOUSE
WASHINGTON
ACTION

MEMORANDUM FOR: THE PRESIDENT
FROM: AL HAIG [AH initialed]
SUBJECT: Venezuelan President Caldera’s Request to Purchase F–4 Phantom Jets

President Caldera has made a personal appeal to you for a favorable response to Venezuela’s request to purchase about ten F–4’s. This would be a cash sale and no credit is requested. The Venezuelans are also considering the purchase of 5 F–5’s and other U.S. aircraft. President Caldera indicated that the F–4’s would help reduce restiveness within his military and allow the Air Force to use solely American equipment. He also emphasized that the F–4’s would only be used for defensive purposes. (Tab B)

Secretary Rogers, with the concurrence of DOD and OMB1, recommends that you not accede to President Caldera’s request (Tab C). He notes that a decision to sell F–4’s to a Latin American country would constitute a major policy shift, with serious foreign policy and Congressional consequences. Secretary Stans, with the concurrence of Treasury, however, favors the sale in order to achieve the commercial benefits for the U.S. (Tab D).

Secretary Rogers’ principal arguments against the sale are:

-- Congressional and press reaction would be negative. Consultations on the Hill last year indicated that there was strong opposition to F–4 sales in Latin America. Congressional sensitivity over a possible “arms race” in Latin America was evident in the negative reaction of some Congressmen to the recent waiver of the $75 million FMS ceiling for Latin America.

-- Colombia, whose relations with Venezuela are currently strained over a border dispute, would react sharply to the sale of F–4’s to Venezuela. They would view the sale as favoritism, particularly since we told them last year that we would sell them planes of the F–5/A–4 generation only. Despite President Caldera’s emphasis on the defensive nature of the F–4, it does have the capability to bomb Bogota.

-- It would be extremely awkward to explain to other Latin countries, such as Brazil and Argentina, why we are making an exception for Venezuela when we turned down their requests for F–4’s previously.

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Secretary Rogers also notes that we have been responsive to Venezuela’s request for military equipment by offering to sell F–5’s equipped with sidewinders, and by providing $7.4 million in credits for other military equipment.

The arguments made by Secretary Stans and Treasury for the sale are:

-- We cannot afford to risk losing a sale of about $110 million, which is the magnitude of the total aircraft package the Venezuelans are seeking.

-- Legislation is presently before the Venezuelan Congress which may adversely affect U.S. oil interests, and turning Venezuela down on F–4’s may complicate this problem. (Secretary Rogers, however, does not believe the sale of F–4’s would have a significant effect on the oil legislation, and in fact argues that a positive response would probably be misunderstood by the U.S. oil firms who are presently under pressure from the GOV.)

A strong argument can be made for revising our policy on arms sales for Latin America. Our restrictions have not prevented the Latins from buying sophisticated equipment elsewhere. This is a subject the Senior Review Group is scheduled to consider shortly in its review of our overall Latin American policy. However, I do not think we have laid the groundwork for a major shift in policy on sale of F–4’s to Latin America. Responding to a single country’s request for F–4’s without prior consultations with the Congress could jeopardize our entire military assistance program in Latin America. In addition, other friendly governments in the region would be resentful if we were to alter our policy on F–4’s for Venezuela without a compelling rationale, after we were unwilling to do so for them.

In fact, Venezuela appears to be a poor case on which to make this major policy shift. Selling F–4’s to Venezuela while it is engaged in a border dispute with Colombia will subject us to particularly severe criticism for contributing to an arms race and destabilization in the area. It will also be particularly difficult to explain favorable treatment for Venezuela while it is putting intense pressure on our oil companies. Moreover, we are already being quite forthcoming with Venezuela on arms sales -- our offer to sell F–5’s with sidewinders is the first time we have done so in Latin America -- and it is not at all clear that we would lose the entire $110 million sale by not providing the F–4’s. (The GOV would probably buy Mirages or similar European aircraft if we do not sell F–4’s, but there is some evidence that Venezuela would go ahead with purchase of helicopters and other aircraft (about $50 million) even if we turn down the F–4 sale. Whether it would buy the F–5’s without F–4’s is more uncertain.)

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On balance, I think we must review our arms sales policy to Latin America in the SRG, and undertake consultations with the Congress and other countries before making a major policy shift on the sale of F–4’s. In the interim, I recommend that you approve the State/DOD/OMB position that we not accede to Venezuela’s request for F–4’s at this time. A draft cable instructing our Ambassador in Caracas to tactfully inform President Caldera of your decision to this effect has been submitted by Secretary Rogers and is at Tab A for your approval.

RECOMMENDATION:

That you approve the draft cable at Tab A to Caracas informing President Caldera that we cannot sell F–4’s to Venezuela at this time.

Approve [Haig signed for Kissinger for President] Disapprove

Attachments:

Tab A -- Draft Cable to Caracas (for clearance)
Tab B -- Caracas 3471 and 3621 (Caldera’s request)
Tab C -- Secretary Rogers’ Memo to President dtd 7–2–71
Tab D -- Acting Secretary Charls E. Walker’s Memo to President dtd 7–1–71; Secretary Stans’ memo
to Dr. Kissinger dtd 6–25–71

  1. Source: National Archives, Nixon Presidential Materials, NSC Files, Box 796, Country Files, Latin America, Venezuela, Vol. 1, 1969–1971. Secret; Nodis. Sent for action. Haig initialed for Kissinger who approved for the President. Attached but not published are Tabs A, B, C, and D. Tab A is an undated draft of telegram 126467 from the Department of State to Caracas; Tab B is telegrams 3471 and 3621 from the Embassy in Caracas, dated June 23 and July 1, respectively; Tab C is a July 2 memorandum from Rogers to Nixon; and Tab D is a July 1 memorandum from Walker to Nixon and a June 25 memorandum from Stans to Kissinger.
  2. President’s Deputy Assistant for National Security Affairs Haig informed President Nixon that the Departments of State and Defense, and Office of Management and Budget (OMB) all argued against selling F–4s to Venezuela. The Departments of Commerce and Treasury advocated the sale. Haig recommended Nixon not make the sale.