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60. Memorandum From the Special Representative for Economic Summits (Owen) to President Carter 1

SUBJECT

  • Letter from Chancellor Schmidt

Attached is a letter to you from Chancellor Schmidt and an attachment, which describe the new German economic program and indicate that it was taken to fulfill Summit commitments. (Tab B)2

I also attach a brief Treasury evaluation of the German program, which suggests that it will result in growth of about 4% next year, as contrasted with 3.5–4% this year. (Tab C)3 German officials expect somewhat better results. The German Summit growth target was 4.5%–5%.

We should compliment Schmidt, without implying that we believe he has fully met the need, since other measures may well be needed. I attach a proposed letter in this sense. (Tab A) It has been cleared with State (Dick Cooper) and Treasury (Tony Solomon).

Tab A

Letter From President Carter to West German Chancellor Schmidt 4

Dear Mr. Chancellor,

Thank you for your letter of September 14. I am glad that you have taken decisions to expand German economic activity. The countries that pledged at the Downing Street Summit to continue effective stabilization programs are largely fulfilling their commitments. The countries with stronger economies have, as you note, a special responsibility [Page 208]for world economic recovery and development. The United States expects to meet its growth target in 1977; given the sharp movement in the U.S. external account, partly as a result of our growth, we think it particularly important that others in a strong position take firm steps to meet their targets. I have just received from Prime Minister Fukuda a statement outlining the measures that Japan will be taking.5

If our nations can concert effective growth policies, prospects for non-inflationary world recovery will be enhanced. I hope that you and I can continue to share our thoughts about actions to this end.

Sincerely,

Jimmy Carter
  1. Source: Carter Library, National Security Affairs, Brzezinski Material, Brzezinski Office File, Country Chron File, Box 13, Germany F R: 7–9/77. No classification marking. Sent for action.
  2. Tab B, attached but not printed, is a courtesy translation of an undated letter from Schmidt to Carter, as well as a translation of a September 14 paper entitled “Decisions of the Federal Government to promote economic growth and employment.”
  3. Tab C, attached but not printed, is an undated paper entitled “German Program for Stimulating the Economy.”
  4. No classification marking.
  5. See Document 59.