Attached is a paper that I have put together from the contributions of the
Tuesday morning North-South group (cluster plus Deal, Mathews,
Denend, Platt and Albright). It probably reflects nobody’s view completely,
but it is probably as close to a consensus as we could come—and we would all
agree that it is the most viable consensus.
Attachment
Paper Prepared by Thomas
Thornton of the National Security Council
Staff3
NORTH-SOUTH AFFAIRS: THE OUTLOOK
While the impulse of the North-South relationship is political, its
content continues to be economic and is usually defined in terms of the
agenda set forth by the G–77 and in
UNCTAD. By its nature, this
agenda is loaded against us—at least in terms of our short and mid-range
ability to respond effectively. The LDCs look to a different
distribution of the world’s resources and power—we find difficulties
here not only because we perceive ourselves to be pretty short of
resources at this time but also because we lack a strong base of public
and Congressional support for policies that affect international power
relationships or cost money. Also, many believe that the demands being
put forth by the LDCs make little economic sense.
There are, however, bright spots in the picture. We have improved our
performance in some of the areas of concern to the LDCs. We came out
well on the aid budget this year; we will have a generally reasonable
posture in the next round of Common Fund negotiations; we have pulled
back from a potentially bitter confrontation over the COW mechanism, and we have been
forthcoming in a number of other specific areas. Movement in these
areas, however, has not been sufficient to offset growing LDC perceptions in the framework of the
N/S dialogue that the United States has not altered its stance on NIEO issues.
But there are more bright spots when we move away from the “G–77 agenda” items.
—On the political front, our actions in Southern Africa, the Middle East
and on the Panama Canal have been well received and bought us a lot of
support.
—In bilateral relationships we have made some significant steps forward,
especially in dealing with the emerging middle powers. While this
progress has been mainly in the political/psychological realm, it has
also been economic.
Unfortunately, there is relatively little feed-back among these realms,
except to the extent that the broad atmosphere of trust and confidence
generated by the Carter
Administration on political issues has
[Page 1014]
probably reduced somewhat the kind of bitterness
our economic “shortcomings” would otherwise have evoked.
The good will is wearing thin, however, and we will be confronting a new
range of challenges from the G–77 in
the coming year.
In addition, continued budgetary stringencies in the US plus run-up to an
election year in 1980 will make it very difficult for us to meet our own
targets, let alone the G–77 demands. We
could also encounter some very heavy political weather in the coming
months, especially in Southern Africa, that would dispel much of the
good will that we have gained by our past policies. Also, we are once
again increasingly isolated in the UN on
such issues as racism and mass media. Thus, we expect things to get
harder rather than easier.
Given the predictable distractions at home plus steady pressure from the
G–77, we generally agree that our
North-South policies in the multilateral economic area should be pursued
cautiously and with limited involvement by the President—probably until
after the next election. Although there was some sentiment for the
proposition that domestic political capital could be found in an
aggressive approach to North-South matters, this was a minority
view.
In our domestic public relations effort, we should continue to work hard
on long-term building of public and congressional attitudes and mount
major or dramatic programs only to meet particular legislative goals;
namely the final MTN package and
perhaps foreign assistance.
We will have to assess very carefully what our capabilities are, and
carefully focus our rhetoric and actions in those areas that are (a)
most likely to produce results, (b) most likely to obtain effective
domestic support, or (c) salient in terms of the negotiating agenda. We
have not generally indulged in excessive rhetoric in the past, but an
even more cautious approach is indicated. There will be pressure for
retrenchment of explicit and implicit administration goals—e.g. growth
in aid levels—and we will have to give this a serious hearing.
In 1979, trade and commodities, including continuing negotiations on a
Common Fund, are the areas on which we will have to focus. There will be
important negotiations in these fields; they are probably the most
promising in terms of stimulating development; and they should be
saleable domestically since they can produce measurable benefits for our
economy. Of course, since they cause dislocations, they also gore some
specific oxen in a way that aid—paid for out of the general revenue—does
not. (Tactically, this suggests that we should key our public relations
efforts to groups that have a positive interest in our
programs—especially consumers.)
These, however, are not the only issues that we will be facing.
Macro-economic performance, monetary and financial issues, energy, our
IFI arrearages, technology
transfer, WARC and Law of the Seas
[Page 1015]
issues will all need
attention at the negotiating table and possibly action by Congress. Our
strategy, while concentrating on trade and commodities, must also
include these. The entire agenda should be presented to the public and
to Congress with special attention to matters that will require
Congressional support in the next session. We should probably avoid
setting public priorities for as long as possible in developing our
legislative programs and rationales; we will, however, need to have our
priorities clearly set in our own minds as we elaborate a strategy for
the remainder of the session.
Putting across our policy, with all of its limitations, is going to be
hard. We will find it difficult to participate in any North-South debate
without either raising undue expectations or returning to the
confrontations of previous years. We will have especially heavy going at
UNCTAD for failure to respond to
the broad range of G–77 demands. Under
these circumstances, it will be a challenge to keep our rhetoric in
line.
There is an argument to be made that we should downgrade our
representation there (and in similar fora) as a symbol of our refusal to
accept them as the proper place for serious negotiation. This would
provide a certain cover for our inability to do much and, it is hoped,
force the LDCs to deal with us more bilaterally. This probably
overestimates our ability to define the scope and content of the
North-South debate, and given this Administration’s commitment to the
UN and North-South debate, most of
us do not support such a step.
We will, however, need to focus much more attention on the problem of
getting economic discussion more into channels where we have strong
cards to play.
The proper vehicle to get this off the ground will be a major speech by
an Administration official in the U.S. to an American audience. The
speech should set out our approach to relations with LDCs (shared
responsibilities), our accomplishments thus far, our objectives for the
future (both political and developmental), and the means with which we
intend to accomplish them. Vance
is the likely candidate. It will have to be very well advanced if it is
to have an impact. By way of introduction, there should be some
reference to key North-South issues in the State of the Union
message.
Overall then, the prospect on the North-South economic front is for
concentration on things that we do best and/or are most important. We
continue to discuss among ourselves how we might be able to make some
gains on the political front, either through dealings with the NAM or by shifting position slightly on
some key UN-related issues. Any such
gains will, however, affect our overall position only marginally.
