Foreign Relations, 1977–1980, Volume XXIII, Mexico, Cuba, and the Caribbean

149. Memorandum From Robert Pastor of the National Security Council Staff to the President’s Assistant for National Security Affairs (Brzezinski), the President’s Deputy Assistant for National Security Affairs (Aaron), and Henry Owen of the National Security Council Staff¹

Washington, December 1, 1978

SUBJECT

• A Strategy for Handling PRM–41 on U.S.-Mexican Relations

I recommend that you skim the PRM response which is only 18 pages before reading this memo. (Response at Tab A)²

Over the last three months, I have participated in many discussions of the PRM and of U.S.-Mexican relations, and I have discovered that they all follow a frustrating and unproductive pattern. (David has experienced this pattern.) Unless the three of you and Secretary Vance deliberately seek to avoid this pattern, I predict the PRC will repeat it. Let me use this memo, then, for three purposes: (1) to describe the pattern and its pitfalls; (2) to suggest a structure for the discussion which will try to avoid the pitfalls and lead to the most productive discussion; and (3) to suggest one outcome which I believe is worth aiming for.

I. Likely Scenario: What to Avoid?

The discussion passes through four stages:

(1) We have been ignoring our relationship at great risk to our nation’s security. In this stage, Mexico’s importance to the U.S. is highlighted: Mexico has oil and gas on the level of a Saudi Arabia, but it’s next door; 12–19 million Hispanics in U.S.; major population in California and Texas; fifth largest trading partner; underdevelopment and instability in Mexico have a direct impact on the U.S.; bad relations harm our security. Conclusion of this stage: we (speaking of the U.S., but actually meaning the participants in the meeting) have ignored Mexico for so long. It’s time for the U.S. to extend itself and make some concessions as a long-term investment in our relationship.

(2) Issue-by-Issue: It’s Their Fault. In the second stage, the discussion gets into the details of the issues which divide our two countries. Beginning with a desire to find ways to cut through the bureaucracy to make decisions on our future, the participants are soon taught by the specialists of each issue that the U.S. has gone more than half-way; it’s the Mexicans who haven’t responded. On trade, they have many more barriers than we; they still have not yet joined GATT; they have been reluctant to get involved in the MTN. On energy, we warned Lopez Portillo several times that we couldn’t accept a higher price for Mexican gas than for Canadian particularly while the Congress was debating the energy bill, and he didn’t listen. We can’t be blamed for the expiration of the gas agreements. On illegal aliens, they are trying to shovel their social costs of adjustment on us. Mexico is a traditional conservative society in which the distribution of income is probably more inequitable than anywhere else in the world. Why should we take their unemployed when they are unwilling to do anything about it themselves?

As the discussion begins to veer toward hostility, someone stops it and pushes it to the third step.

(3) Return to Status Quo. Everyone is sobered to the stickiness of the issues. Then, someone reminds the group of Mexico’s importance, as per the beginning of the meeting. (If this reminder comes prematurely, he will be accused of being “soft” on the Mexicans.) At this stage, there is the first glimmer of understanding of both the real difficulties of making any progress in U.S.-Mexican relations and why it requires our constant efforts.

(4) New Organizational Mechanism. By this time, the meeting has gone at least 20 minutes longer than anyone has planned. People begin looking toward the exit, but the Chair insists on a conclusion, and since everyone has tacitly concluded that something must be done but no progress on any of the issues is possible, the next best thing is to recommend a “high-level organizational consultative structural mechanism framework”. At least, two of those words will be in the recommendation; the order doesn’t matter.

II. How to Structure the Discussion.

The PRM itself provides an outline for a good discussion. I suggest that you begin with a 10-minute general and conceptual discussion of alternative frameworks from which to visualize the future of U.S.-Mexican relations (pp. 4–6): whether to deal with our problems on an ad hoc basis as we would deal with any other “upper-tier” developing country? or whether we should recognize that our problems are interrelated and should be approached in a systematic way with two possible goals in mind: to try to better manage our increasing interdependence, or to try to move step-by-step towards an economic community or partnership? I think we should choose the latter, and that a decision on this could be very significant, but such a choice at the beginning of a meeting will be difficult and meaningless.

Instead, it’s essential to cut the philosophical discussion short (10 minutes) with the intention of returning to it after a discussion of the issues. This will permit the participants to more fully grasp the implications of each “policy direction” before making a decision.

Energy. Option One: Seek gas purchases primarily as an investment in broader cooperation. Schlesinger will resist this route, but it is the critical piece of the package; and furthermore, it not only makes sense from the perspective of trying to build a more durable long-term relationship with Mexico but also from the perspective of trying to secure long-term energy supplies. This issue will need to be decided by the President. With the PRC’s recommendation, you will also want to transmit some ideas of how we would go about implementing option #1 and how would the President’s visit fit into that scenario. Some discussion of this at the PRC would be useful.

Trade. Somewhere between option 2 and 3. The most important decision we can make in trade is to begin exploring with the Mexicans the possibility of long-term sectoral arrangements, starting with agriculture, but perhaps moving towards light manufacturing goods. The Mexicans have already begun thinking about sectoral arrangements and have even studied the U.S.-Canadian Automotive Agreement, which they concluded was not as desirable as they had thought. I think they will be open to ideas in this area, but we should not press for a Community yet because they are not ready for it.

Migration. On this issue, we have considerable maneuverability between what the President proposes (which could be tough with employer sanctions; or emphasize the soft part, amnesty) and what the Congress is likely to do next session which is probably nothing. They will probably sit it out, waiting for the Commission to issue its report (1980).³ The Mexicans prefer us to do nothing. Their second-order preference is for us to regularize the flow (through a temporary worker program of some sort) at as high a level as possible. I recommend that we re-sensitize the President to the implications of this issue, and suggest a range of possible policies. In his conversation with Lopez Portillo, he can select within that range according to how flexible Lopez Portillo is on the other issues. The domestic agencies (Justice, Labor, Commerce, Stu)⁴ feel strongest about this.

Border. Option One. I don’t think it would hurt to explore option 2—special borderlands agreement—with the Mexicans, but I think it’s unrealistic. The problem with border arrangements is that we like to coordinate such arrangements at the local or state level on the border, and they like to do it from Mexico City. This is changing marginally, but not enough to permit useful coordination yet.

Illustrative Framework. After discussing the issues at some length, it will be necessary to pull the discussion back to the general issue of how to structure our overall relations. I favor Option #3—Partnership. To really implement this, we need to develop it with the Mexicans. I strongly recommend option one on “negotiating structure”, to appoint a high-level Presidential representative to discuss, and perhaps eventually negotiate, the complete set of bilateral issues affecting the U.S. and Mexico with a person of comparable stature appointed by Lopez Portillo. Hopefully, the outcome of the PRC meeting as approved by the President would provide the negotiating parameters. The negotiators seek a “package” agreement.

In addition, Vaky feels strongly of the need for greater coordination within the USG on a continuing basis on U.S.-Mexican relations. He would create a Special Office of U.S.-Mexican relations in State headed by someone of the stature of the special negotiator. I think the idea is good, but impractical. U.S.-Mexican relations impinge on too many domestic and political interests to think that it can be managed like any other foreign policy issue.

Let me emphasize the importance of trying to keep the discussion structured or else it will pass like sand through everyone’s hands. There is a specific outcome which we want to aim for, but that can only be achieved if the discussion is guided by a strong hand.

III. Outcome

Let me review a possible outcome. If you agree this is worth aiming for, I will draft a PD on that basis.⁵ I suggest you speak with Secretary Vance since he has discussed the PRC meeting with Vaky, Cooper and others several times, and possibly has some firm ideas on how he wants to handle the meeting.

We want to aim for a set of policy directions on the major issues in our relationship which will sum to a comprehensive package. This then can be used as a basis for discussions between high-level representatives of both Presidents (with teams of just 3–4 specialists). The premise that underlies this exercise is that our relationship with Mexico will be characterized by increasing interdependence—our societies, politics, and economies will increasingly affect each other—and that we need to find a better way to manage this interdependence to the benefit of people in both countries. We also ought to be moving down a road in which the barriers to trade are reduced, and the U.S. and Mexico can increasingly view each other as a single community.

With regard to specific policy directions:

—A Comprehensive Package. In his conversation with Lopez Portillo, President Carter should begin with the idea articulated by Lopez Portillo (JLP) in their first conversation:⁶ to focus on the interrelationships between the issues and try to put together a comprehensive and long-term package. The President should propose that he and JLP appoint a special high-level negotiator to do that, but that the two Presidents should first sketch out the parameters of such a discussion.

—On Energy, long-term interests of both our countries clearly suggest the need for an arrangement. We should permit the maximum flexibility for our companies to negotiate a deal. That means that we should recognize that the outcome of the deal will have an effect on our long-term relationship as well as on our long-term energy requirements.

—On Trade, we should develop a relationship that builds upon Mexico’s entry into GATT. We should look to ways to gradually reduce the barriers to trade between our two countries and to increase the long-term complementarity of our economies—perhaps starting with the agricultural sector—in a way which will minimize the harmful effects of an adjustment process and maximize the benefits to both economies.

—On Migration, we do not intend to seal the border, nor do we think it possible to eliminate the flow of illegal aliens to the U.S. Still, we think the flow can be reduced, and we seek the cooperation of the Mexican Government to that effect. New legislation should not be introduced into the Congress until after the President has had a good and full opportunity to discuss this with Lopez Portillo.

—Border Arrangements should be one of the subjects considered by the special negotiator. Greater coordination is desirable.

—In summary, we should move towards more of a partnership in our relationship with Mexico.

1. Source: Carter Library, National Security Council, Institutional Files, 1977–1981, Box 51, PRM/NSC–41. Confidential. Copies were sent to Erb and Poats. Prepared in advance of the PRC meeting; see Document 150.
2. Not attached, but see Document 146.
3. Reference is to the Select Commission on Immigration and Refugee Policy established by P.L. 95–412, October 5. The Commission issued its report on March 1, 1981.
4. Stuart Eizenstat was the President’s Assistant for Domestic Affairs and Policy.
5. No Presidential Directive on Mexico was issued during the Carter administration.
6. See Documents 130 and 131. Carter visited Mexico February 14–16, 1979; see Documents 156 and 157.