35. Memorandum From Secretary of State Vance to President Carter 1

SUBJECT

  • International Financial Institutions Authorization Bill

Summary

The Senate Foreign Relations Committee will mark-up the international financial institutions (“IFI’s”) authorization bill on April 19. The issue for your decision is whether we should (a) vigorously support the human rights language reported by Senator Humphrey’s Subcommittee on Foreign Assistance and (b) oppose the Badillo Amendment which requires the U.S. to vote against any loan to countries where human rights are violated. I recommend that we do so, and make your views known through a letter to Humphrey (draft at Tab 1).2 The recommended approach has been approved by Humphrey.

Background

On April 2, 1977, you wrote Congressman Henry Reuss a letter applauding his Committee’s action in adding a human rights title to legislation authorizing U.S. participation in the IFI’s.3 As you will recall, the Reuss approach provided broader discretion than the restrictive Harkin Amendment. On April 4 the House adopted two Badillo Amendments (Tab 2)4 to the Committee language. The first (Section 601 (e)) severely restricts U.S. discretion by requiring that we vote against any loan to a country where human rights are violated unless such assistance is directed specifically to programs which serve the basic [Page 104] human needs of the citizens of the country in question. A second, and potentially useful, Badillo Amendment (Section 602) requires the Secretaries of State and Treasury to initiate international consultations “to develop a viable standard for meeting basic human needs and the protection of human rights,” and a mechanism to reward those who seek to achieve those standards.

Meanwhile, on the Senate side, Humphrey’s Subcommittee has reported Reuss-type language (Tab 3)5 to the full Senate Foreign Relations Committee which will mark-up on April 19. Our latest indication is that Humphrey will go all out for passage of this language, provided the Administration supports him.6 The full Committee is likely to adopt Humphrey’s language. Prospects on the floor are uncertain, however. There is a substantial possibility that a coalition of liberals and anti-IFI conservatives will succeed in attaching Badillo-type language to the bill.

I think the Humphrey language represents a positive approach which permits us to maximize our influence for human rights within the banks and with the recipient governments. By contrast, I believe the Badillo language represents too wooden an approach to the problems it addresses and that the Administration should not support it. Although the Badillo Amendment contains an exception for assistance specifically directed to basic human needs, we believe that the practical difficulties of interpreting and applying that exception on a case-by-case basis would be enormous and the exception would ultimately prove counter-productive. An elaboration of the arguments against the Badillo Amendment is set forth in a Treasury paper under Tab 4.7

Your strong support of Humphrey’s language and explicit opposition to Badillo-type amendments will not necessarily guarantee success [Page 105] on the Senate floor. However, I think that this is the right position and that, even if we fight and lose, our human rights commitment will look stronger than if we stand aside.

I believe that endorsement of the second Badillo Amendment providing for consultation may improve the prospects of winning, and I so recommend. Senator Humphrey agrees, and this point is incorporated in the draft letter to him.

I think the most effective means of presenting your position will be a letter to Senator Humphrey, copies of which will go to the full Committee. I also urge that your position be presented to the leadership at breakfast on Tuesday, April 19.

Recommendation

That you send to Senator Humphrey the letter attached under Tab 1, copies of which would be sent to all the members of the Senate Foreign Relations Committee as well as to the Speaker.8

That you state your position at the leadership breakfast next Tuesday.9

  1. Source: National Archives, RG 59, Office of the Deputy Secretary: Records of Warren Christopher, 1977–1980, Lot 81D113, Box 7, Memoranda to the Secretary—1977. No classification marking. A handwritten notation on the memorandum reads: “The final version.”
  2. Not attached. A copy of the draft letter to Humphrey is attached to an undated draft Presidential form letter, along with an undated paper outlining the administration’s position on the Badillo and Humphrey human rights amendments and a copy of an April 2 letter to Reuss, in which Carter expressed his hope that “H.R. 5262 will be passed by the House of Representatives as soon as possible.” These materials were collated in D in advance of an April 14 interagency meeting on human rights. (National Archives, RG 59, Office of the Deputy Secretary: Records of Warren Christopher, 1977–1980, Lot 81D113, Box 17, Human Rights Interagency Group I)
  3. The President’s April 2 letter to Reuss is attached to an April 13 memorandum from Lamb to Christopher transmitting materials for the April 14 interagency meeting. In his letter, Carter communicated his support for Reuss’ bill and the flexibility it embodied. (Ibid.)
  4. Not found attached. See Document 33 and footnotes 2 and 5 thereto.
  5. Not found attached. See Document 33 and footnote 4 thereto.
  6. Katz, in an April 7 briefing memorandum to Vance, reported on a conversation he had with Humphrey that afternoon concerning agricultural policy. When Katz inquired about the Badillo amendment, Humphrey indicated that he “intended to fight” for his amendment, which contained similar language to the Reuss bill, during the impending SFRC markup session. Humphrey added that he “expected to be criticized as anti-human rights for his sponsorship of the Harkin repeal, but he was prepared to take the heat.” Katz then commented, “I understand that supporters of the Harkin amendment are preparing a major lobbying effort in the Senate. If Senator Humphrey is going to battle them, it seems to me that the Administration must take an unequivocal position on the issue and throw its weight squarely behind him. We should not leave him exposed on this controversial and emotional issue.” (National Archives, RG 59, Office of the Deputy Secretary: Records of Warren Christopher, 1977–1980, Lot 81D113, Box 17, Human Rights Interagency Group I)
  7. Not found attached. According to an April 19 memorandum from Christopher to Vance (see Document 37), the Department of the Treasury had prepared a memorandum subsequent to the one Bergsten transmitted to Bennet (see Tab A, Document 33), presumably the one to which Vance is referring.
  8. Although there is no indication that the President approved or disapproved this recommendation, Carter sent Humphrey a letter on April 18, outlining his support for Humphrey’s approach. (Graham Hovey, “Senate Committee Backs President On Aid to Nations Observing Rights,” The New York Times, April 20, 1977, p. A–5) A signed copy of this letter, which Brzezinski and Moore sent to Carter under an April 16 covering memorandum recommending that he sign the letter, indicates that it was hand-delivered to Humphrey on April 18. (Carter Library, Staff Secretary, Presidential File, Handwriting File, Box 18, 4/18/77 [5])
  9. There is no indication whether the President approved or disapproved this recommendation. On April 19, the Senate Foreign Relations Committee rejected the Badillo-Harkin language in favor of language directing the United States to use its “voice and vote” in the IFIs. (Graham Hovey, “Senate Committee Backs President on Aid to Nations Observing Rights,” The New York Times, April 20, 1977, p. A–5)