Foreign Relations of the United States, 1977–1980, Volume XXVII, Western Europe

98. Memorandum of Conversation¹

Washington, July 13, 1977, 11 a.m.–12:25 p.m.

PARTICIPANTS

• The President
• The Vice President
• Secretary of State Cyrus Vance
• Assistant to the President for National Security Affairs Dr. Zbigniew Brzezinski
• Ambassador Walter Stoessel
• Ambassador Gerard Smith
• Assistant Secretary of State for European Affairs George Vest
• Gregory F. Treverton, NSC Staff Member, Notetaker
• Chancellor Helmut Schmidt
• Foreign Minister Hans Dietrich Genscher
• Ambassador Berndt von Staden
• State Secretary Manfred Schueler
• State Secretary Klaus Boelling
• Assistant Secretary for Political Affairs Juergen Ruhfus
• Assistant Secretary Dieter Hiss
• Interpreter for Minister Genscher, Mrs. Gisela Niederste-Ostholt

After opening pleasantries, the President suggested that the meeting be devoted to East–West issues, with economic questions and perhaps MBFR discussed the next day. He indicated that he or Vance would be happy to brief the Germans on the Middle East.

The President then reviewed various East–West issues:

SALT

The United States wants to strengthen its relations with the Soviet Union. At the same time, it wants to deal with East–West issues that have been postponed—for instance the U.S. seeks not just to ratify higher limits on nuclear weapons but to freeze and then begin to reduce those levels. The President said he would provide details on SALT. The U.S. presented two options: (1) ratifying the Vladivostok formula, or (2) moving directly to SALT 3 by reducing overall levels to 1800 and MIRV totals to 1100, by constraining heavy missiles and cruise missiles and by imposing a total freeze on new weapons. So far, the United States had not been successful, but Vance would meet with Gromyko in September.

Comprehensive Test Ban

Progress on CTB had been better. The U.S. is prepared to stop all testing of nuclear devices, even so-called peaceful nuclear explosions (pne’s). The Soviet Union is reluctant to forego pne’s, but the U.S. had been generally pleased with the Soviet response. The U.S. is prepared to let France and China remain outside the test ban, though with the hope that they will eventually join. The Soviets had at first insisted that China must be a party, but later dropped that insistence. They want a treaty for 18 months, the U.S. desires a longer period.

Indian Ocean

The United States wants to freeze military activity in the Indian Ocean, make provision for prior notification of movements in the area and then begin reductions. The small nations in the region do not want to see great power activity increased, and the Soviets have responded to U.S. initiatives.

Other Arms Control Issues

The United States has also proposed treaties banning chemical and radiological warfare; those appear to have good prospects. The U.S. has proposed that both sides give prior notification of missile tests. Soviet–American study groups are looking at all the questions the President mentioned. The U.S. is also concerned about anti-satellite capabilities and has proposed a ban on such systems. The Soviets are testing them, and the U.S. feels that is dangerous. The Chancellor asked if the Soviet Union has an edge in anti-satellite capabilities. The President responded that the Soviets have conducted seven tests, with two successes. The U.S. is discussing ways to limit those systems; given the role of satellites in monitoring arms control, the issue is clearly important.

The President noted that the U.S. and the Soviet Union had renewed treaties for cooperation in space. Kirillin was in Washington the week before to discuss cooperation in science and technology, and the U.S. airlifted a large experimental magnet to the Soviet Union as part of that cooperation.

Soviet Attitude Toward the U.S.

The last and most difficult area, the President indicated, is the Soviet comprehension of U.S. attitudes. The U.S. wants peace and a diminution of tensions. The Soviets are concerned—as the Chancellor had indicated—about human rights. The President believed the U.S. and German positions at Belgrade are compatible; the U.S. has no desire for polemics. The Chancellor asked if the President agreed that Western cooperation with the Soviets at Belgrade had been good. The President did agree, and Vance called the latest proposal by the non-aligned nations a good one.

The President said that Brezhnev had emphasized the negative, not the positive. When Vance met Gromyko, there was progress. But then Brezhnev or Gromyko would decry the lack of progress and suggest that the U.S. wanted a return to the Cold War. It is hard to know Brezhnev’s motives. The Soviets had had some success in the media—perhaps even with the Chancellor—in arguing that the U.S. did not want progress. The President had asked Brezhnev for his proposals, had offered to meet in Washington or in Alaska, but there was no response. The President stressed his desire to meet with Brezhnev and to convince him of the U.S. good faith.

On the whole, the President said, the U.S. has met with reasonable success in its dealings with Moscow. Moving into new areas was bound to be hard—and the U.S. had proposed, simultaneously, reductions on missiles and on deployments in the Indian Ocean, a ban on anti-satellite capabilities, and prior notification of missile tests. Yet the President remained hopeful. He felt that the Soviet Union has economic problems, and has made no progress in relations with China. Stability in Eastern Europe remains adequate from the Soviet point of view—although the President said he would defer to the Chancellor’s judgment on that point. The President indicated that the U.S. wants to treat all three baskets at Belgrade, not bias the conference towards one. The U.S. wants progress, not embarrassment for any nation.

Schmidt’s View of Brezhnev

After thanking the President for his presentation, the Chancellor presented his view of Brezhnev’s position. He said it was important to remember that Brezhnev is not as powerful, institutionally, as an American President or even as a German chancellor. “Showing off” in Eastern Europe may be in part a compensation for Brezhnev’s “lack of sovereign power of decision” in most areas. He is dependent on others, especially now that his health is failing. There is no decision he can take by himself. He of course has great influence; he can sum up meetings and issues for decision, but he must use “tricks” to make his desires prevail in the Politburo.

At the same time, Brezhnev, the Chancellor suggested, is perhaps the most forthcoming of the Soviet elite; Tito had told the Chancellor that Brezhnev was “obsessed” with detente. Some of that same feeling had run through the Chancellor’s conversations with Kadar of Hungary, though Kadar was cautious and most of what he said was between the lines (what he actually said could have been read in Moscow without harm to Kadar). The moderates in Eastern Europe—Gierek, Kadar, Tito—are all genuinely concerned about a return to the Cold War.

The Chancellor believed the West should ask: should we try to give Brezhnev an edge, in information at least, over his associates. For instance, the President’s B–1 decision² was surely hard for the Soviets to read. While Brezhnev tried to make up his mind what it meant, others in the elite were spreading a hard line on it. Giving Brezhnev forty-eight hours of warning would have been useful.

The President asked the Chancellor if he saw Brezhnev as the West’s best hope.

The Chancellor said yes, calling Brezhnev “our best man” with whom to pursue “your” relaxation of tensions. The Chancellor feared Brezhnev’s incapacitation and the accompanying uncertainty; he believed that since Czechoslovakia Brezhnev had given Eastern Europe some breathing room. Brezhnev has three abiding motives. The first is his obsessions with China; the second is his preoccupation with structural economic difficulties. But the third is his belief that detente is his life task.

The President responded that we want to see him realize his goal. There is nothing to gain from an unfriendly attitude. Perhaps we have moved too fast in too many areas; the Soviet government is old and cautious. We will try to reassure them in every way we can; we will not respond to expressions of animosity on their part. In private, except for SALT, progress has been encouraging. We would like to bring them into Middle Eastern discussions; none of the parties want them deeply engaged at present, but we keep them informed. The Soviets have an inclination to deal bilaterally, while the President said he preferred multilateral discussions. The Soviets have responded slowly when we have talked with them about, for instance, non-proliferation or arms transfers.

The Chancellor remarked that the Germans had heard reverberations of Soviet–American discussions of non-proliferation.

The Chancellor turned to Foreign Minister Genscher, noting that the latter’s impressions of Brezhnev were quite different from Giscard’s.

Foreign Minister Genscher said he met with Brezhnev for two hours on the day before he was elected President. He seemed in full command, despite the stress he must have been under and despite the fact that he looked noticeably older than when Genscher had seen him a year and a half before. He showed Genscher papers that he had dictated himself.

The President commented that Genscher’s impression was indeed very different from Giscard’s, and asked if Genscher had not indicated to Vance in Geneva that Brezhnev agreed there had been progress in relations with the United States.³

Foreign Minister Genscher said that Brezhnev seemed optimistic, though he attributed his optimism to a change in the U.S. Administration’s actions.

The President remarked that in Paris Brezhnev said there had been no progress; he must go up and down.

Foreign Minister Genscher said he believed a personal meeting between the President and Brezhnev would be good, and indicated he had told Brezhnev so.

The Chancellor noted that it would be hard to bring about such a meeting. Neither Brezhnev nor the rest of the leadership is prepared to hold one until there is something concrete to show the world. It is a shame there is nothing in the offing like the Helsinki meeting, which would permit the two men to meet without great public expectations.

The Chancellor referred to the President’s indication that he wanted to “suck” the Soviets into international negotiations, perhaps in the Middle East. He agreed and suggested that the Allies follow up privately their proposal at the London summit for Soviet involvement in North–South discussions. He referred also to the three Soviet CSCE proposals and said the West should accept the one dealing with energy. That might include nuclear non-proliferation and should encompass natural gas and East–West cooperation of the sort reflected in the FRG’s triangular deal with the Soviet Union and Iran. That would make the Soviets more conscious of the international economic fabric.

The President said he had no objection to accepting such a proposal and wondered if the West had not already done so.

Secretary Vance said it would be done at Belgrade in the fall.

The Chancellor noted that in return the Soviets would have to accept the invitation to become involved in North–South deliberations.

The President noted that the UN will deal with disarmament this fall but said he thought energy was a good subject of cooperation. Environmental questions are less international. And too big nationally, commented the Chancellor.

Situation in the Middle East

The President said there is a glimmer of hope that progress might be made this year. The U.S. was surprised by Begin’s election and by some of his initial statements. Since then he has sounded more moderate—saying he is prepared to go to Geneva without condition, that everything is negotiable—although in private he has continued to refer to the West Bank as liberated, not occupied. The President said he had held good talks with Hussein, Asad and Sadat; he had outlined the three-point American framework to them all. He felt that none of the Arabs except perhaps the Saudis wanted an independent Palestine; all feared Soviet influence in such a state and preferred some form of federation with Jordan. A settlement will be hard for both sides: Israel will have to withdraw and the Arabs will have to accept normal trade and diplomatic relations with Israel. But the existing situation is a terrible drain on them all. We will not impose terms; at present the Arabs are more eager for a specific U.S. proposal than are the Israelis.

Secretary Vance indicated that the EC statement on the Middle East⁴ had been helpful.

The Chancellor said he had read that there was a difference between it and the State Department statement,⁵ but Vance replied that the only difference was that our statement did not mention the PLO since we do not recognize it.

The President added that until the PLO accepts UN resolutions 242⁶ and 338,⁷ the U.S. will not negotiate with it.

The Chancellor asked if the Arabs would not demand some PLO participation at Geneva, and the President responded that it might be part of the Jordanian or some combined Arab delegation. Will Sadat accept the latter? the Chancellor asked.

Secretary Vance responded that Sadat wants national delegations, while Asad wants a single Arab delegation since he does not trust Sadat, but he might change if the others agree.

The President suggested that there might be some combination of national and united Arab delegations. We have no contact with the PLO but get messages to them indirectly. The PLO wants an independent state, and the Saudis occasionally back it, while the others do not.

The President repeated that we seek an overall settlement agreement; that agreement could then be implemented in steps depending on the good faith of both sides. With regard to boundaries, Golan is not a great problem, but the West Bank and Gaza are harder. If both sides agree to peace, the boundary question should be more manageable.

The Chancellor understood that the United States would not return to the Kissinger step-by-step approach, but he said that without some secret U.S. scheme there would be little chance of progress.

The President indicated that the Geneva conference should not be re-convened until there is a good chance of success. Prime Minister Begin apparently is coming to Washington with proposals that Rabin would not even discuss. Then Vance will return to the area.

Dr. Brzezinski said that perhaps a pre-Geneva meeting could be held in Washington, ostensibly on procedural matters, but affording the opportunity to “smuggle” in substantive issues.

Secretary Vance added that general agreement was necessary before the parties arrived in Geneva, and the Chancellor said that otherwise the conference would fail.

The President agreed. He said that the specifics—drawing lines through Jerusalem, for example—were extremely difficult. Both sides had taken hard and specific positions. It was worthwhile to just loosen up the discussion.

U.S. Withdrawal from ILO

Chancellor Schmidt raised the issue of American withdrawal from the ILO⁸ and expressed his concern and that of the Europeans generally. He said he understood that AFL–CIO President George Meany had taken a strong position on this issue, but felt that withdrawal would only weaken the West’s position. The Chancellor said he would convey these sentiments to Meany but that Meany would not listen.

The President said Meany wouldn’t listen to him either. According to the ILO charter, business, labor and government must all agree. There is, at the moment, no government position. There was, however, Secretary Kissinger’s announcement two years ago, which still stands. The President said that the last session was very bad and that the issue now was whether to carry out the U.S. ultimatum.

The Chancellor said that non-communist labor organizations were deeply worried about the prospect of U.S. withdrawal. He felt that we must find a way that we can remain without abandoning the previous administration’s position.

The President assured the Chancellor that no decision had been made.

Chancellor Schmidt commented on labor developments in the south and southwest of Germany. He noted that the German labor situation is often overlooked.

The President asked if the ILO was a constructive force in the FRG.

Chancellor Schmidt replied that while it was not now constructive, it might become destructive, both in Germany and by supporting communists in France and Italy.

Secretary Vance asked if there was any way in which the ILO can become less political in its decision-making process.

The Chancellor said that we could pursue this issue later; he had merely wished to convey his concern to the President. Perhaps, the FRG could put forward some proposals.

The President welcomed this; he said that the current U.S. view is that the influence of the ILO is not constructive and that therefore we do not want to be associated with it.

The Chancellor said that the U.S. can disagree with the majority, but if it leaves the ILO the influence of the Communists will rise, which would be destructive.

Foreign Minister Genscher added that all the EC foreign ministers had agreed to request that the U.S. remain.

The President told Vance to have the State Department draw up an assessment of the impact of U.S. withdrawal upon France, Italy, Spain and Portugal. He noted that Meany might accept an anti-communist argument.

The Chancellor said that the real problem was that this issue could not be discussed in public.

The Vice President said that while he liked Meany, he agreed with the Chancellor’s assessment that Meany will not change his views.

The President said that he might and Vance added that Kirkland was more flexible.

MTN

The President raised the issue of MTN. He said Strauss had told him that there was progress and he felt a commitment to move quickly. This was important because, absent rapid movement in MTN, he would feel pressure and so, perhaps, would the Chancellor.

Chancellor Schmidt noted that the London Summit had helped.

The President said France was the problem. If Schmidt could help overcome French reluctance, it would be appreciated.

The Chancellor said that French uneasiness with free trade was deeply rooted in history and in the great French schools; Giscard was a product of this educational system.

The President asked if Schmidt was discouraged.

The Chancellor said that there was a specific obstacle: the difficulties encountered by North American and European economies in penetrating the Japanese market. We can negotiate tariff reductions and eliminate non-tariff barriers, but intangible barriers remain. This contributes to the cooling of relations. He said the FRG was committed to free trade. He said that he’d heard from Brussels that the EC was pleased with the way the negotiations were going.

The President said that Strauss was pleased also and asked the Chancellor whether there was any specific difficulties with Japan.

The Chancellor said there were two: steel and shipbuilding. He said one could not really blame them where they are more efficient, but that when they do other things on top of that, it is trying. Ninety percent of the ship construction is being done in Japan. That is difficult for the Chancellor, as he is from a shipbuilding constituency.

Chancellor Schmidt said that steel is an even harder problem as more people are involved. The slump in the industry was a result of the end of the Vietnam war and the onset of recession.

The President asked about steel prices in the FRG.

Chancellor Schmidt replied that it was bad for sellers.

Non-Proliferation

The President asked about the fuel cycle study. He said that Giscard was concerned after the first meeting of the experts⁹ that they had received unclear instructions.

Chancellor Schmidt said that Giscard had the feeling that the experts were straying from the terms of reference; that the U.S. representatives were not as concerned as they should be with all aspects of the problem and with the interests of other countries.

The President asked Gerard Smith for his assessment.

Ambassador Smith said that after the last meeting the French had seemed more relaxed. The next meeting will be held on July 26.

Chancellor Schmidt agreed that the last meeting was more relaxed.

The President suggested that Smith might go to Bonn, and the Chancellor agreed.¹⁰

The President said that he wanted to understand Schmidt’s problems. Perhaps we did not in the past. The Chancellor’s visit would help.

The President did not see why it should take two years to complete the study. He said there were deep feelings on this issue in the U.S. The U.S. will build a new centrifuge plant to insure supplies for the Germans and others. Progress was essential.

The Chancellor reminded the President of the FRG’s statement of June 17.¹¹

The President said that it was received with great rejoicing here.

The Chancellor said that it was always easier to act without pressure from the New York Times. He mentioned Canada’s decision to resume supplies to Euratom.¹² He said the basic question in the studies was how to implement the political goals they shared. He felt that the answer was to develop the IAEA. He admitted that this might produce new suspicions but stressed that the arrangement must be global, including the Soviets. An amendment to the NPT might be useful but will take time. The basic analysis could be completed within one year.

The President said that if we can identify the problems, we can address them. Brazilian President Geisel had told Mrs. Carter that Argentina was building a reprocessing plant and he implied that Brazil would not if Argentina did not.¹³

Neither country has signed the Tlatelolco Treaty. The President felt that if we can assure autonomous fuel supply arrangements, then progress can be made. The U.S. was unsuccessful in getting Argentina to sign the Tlatelolco Treaty. Brazil is not a party to the NPT. Brazil has signed the Tlatelolco Treaty, but it is not yet in force. The U.S. signed; it will not introduce nuclear weapons in Puerto Rico or the Canal Zone. We are pressing the Soviets and the French to sign.

The Chancellor said that the FRG’s view was that cooperation must be based upon equal status. He felt an amendment to the NPT would be difficult to achieve. It was better to work within the IAEA (which he labelled, jokingly, “a modern American four-letter word”).

The President said that the concern with non-proliferation had predated his administration. The previous administration had faced the issue with regard to Taiwan. He suggested that the next day’s discussion center on economic issues, where he sought the Chancellor’s help, on MBFR and Eurocommunism. He indicated that he and the Chancellor would meet privately that evening.

The Chancellor added that the Berlin problems had abated. He said the London statement had been very helpful.¹⁴ He commented that the new Mayor of West Berlin was an able and reliable fellow and asked the President to meet with him during his upcoming trip to the United States.

The President said he would.¹⁵ He said that he was pleased with the results of the London statement; the Soviets and East Germans saw that the West was resolved.

Chancellor Schmidt commented that relations with the GDR were uncertain; two months ago, prospects looked favorable for negotiations on human movements, but now they were uncertain. He felt the GDR did not want to stick its neck out until the trends in East–West relations were clarified.

The President noted the recent news reports of the GDR’s interest in better relations with the U.S.

Chancellor Schmidt said that if Vance went to East Berlin, they’d throw out three red carpets.

The President asked whether Vance should go.

Chancellor Schmidt said Vance should come to West Berlin instead.

The President said that we had already sent our best statesman [the Vice President].¹⁶

1. Source: Carter Library, National Security Affairs, Brzezinski Material, Subject File, Box 35, Memcons: President: 7/77. Secret; Sensitive. Prepared by Traverton. The meeting took place in the Cabinet Room. Schmidt visited Washington from July 13 to 15 for talks with Carter, Vance, Blumenthal, and Brown. A record of Vance’s July 13 meeting with Schmidt is in Department of State, Stoessel Papers, Lot 82D307, Box 3, Ambassador, Chron: Memos for the Record, 1976–77; a record of Blumenthal’s July 13 meeting with Schmidt is ibid.; a record of Brown’s July 14 meeting with Schmidt is in Memorandum for the Record, July 21; Department of Defense, Accession 330–80–0017, Box 67, Germany 092.112 (Jan–Dec) 1977.
2. Reference is to Carter’s June 30 announcement of his decision to cancel the development of the B–1 bomber; see “The President’s News Conference of June 30, 1977,” Public Papers: Carter, 1977, pp. 1197–1206.
3. Apparent reference to Genscher’s comments to Vance during their June 24 breakfast meeting in Geneva, which was reported in telegram secto 7015 from Vance, June 24. (National Archives, RG 59, Central Foreign Policy File, D770227–0347)
4. Reference is to the statement on the Middle East issued by the European Council on June 29 (the first day of a two-day meeting held in London). (“Common Market Leaders End London Meeting,” New York Times, July 1, 1977, p. 4)
5. For the Department’s June 27 statement on the Middle East, see “U.S. Statement on the Middle East,” New York Times, June 28, 1977, p. 6.
6. UN Security Council Resolution 242 is printed in Foreign Relations, 1964–1968, Volume XIX, Arab-Israeli Crisis and War, 1967, Document 542.
7. UN Security Council Resolution 338 is printed in Department of State, The Quest for Peace: Principal United States Public Statements and Documents Relating to the Arab-Israeli Peace Process, Department of State Publication 9373 (Washington: Department of State, 1983), p. 40.
8. Reference is to Kissinger’s November 6, 1975, announcement that the United States would withdraw from the ILO because it “appears to be turning away from its original objective” and that the United States was prepared to remain a member if the organization “returns to its basic principles.” (“U.S. Informs I.L.O. of Intent to Quit,” New York Times, November 7, 1975, p. 7)
9. Reference is to the first meeting of the Expert Group on Nuclear Energy and Non-Proliferation, which occurred on June 8–9 in Paris.
10. On October 25, Smith met with Schmidt in Bonn to discuss U.S. concerns that Brazil’s construction of a reprocessing plant might have spurred Argentina to build its own reprocessing plant, which would be capable of producing plutonium for weapons and which might be operated without safeguards. According to a report on the talks: “The Chancellor expressed his understanding of the seriousness of the potential reprocessing competition in Latin America. He made clear that the US should not expect German participation or help in pursuing the matter with the Brazilian Government.” (Telegram 257624 to Brasilia, October 27; National Archives, RG 59, Central Foreign Policy File, D770395–0555)
11. On June 17, the FRG Government stated that West Germany would not issue any more export licenses for nuclear fuel reprocessing plants or technology; existing contracts would remain in force. (AAPBD 1977, Document 160, note 4)
12. On January 1, Canada embargoed uranium shipments to Euratom countries in response to French and German refusal to adopt safeguards that would prevent production of plutonium which could be used to make nuclear weapons. On July 12, Schmidt and Trudeau agreed to negotiate an arrangement under which Canada would resume deliveries of uranium to Euratom countries for two years, until the completion of the INFCE study. (Robert Trumbull, “Canada is Expected to Resume Sending Uranium to Europe,” New York Times, July 13, 1977, p. B2)
13. Reference is to Rosalynn Carter’s June 7 meeting with Geisel, which was reported in telegram 4709 from Brasilia, June 10. (National Archives, RG 59, Central Foreign Policy File, D770207–0971)
14. Reference to the Four-Power Declaration on Berlin, May 9. See Document 7.
15. Stobbe visited Washington from August 20 to 23. On August 22, Carter met Stobbe in the Cabinet Room from 1:05 to 1:25 p.m. (Carter Library, President’s Daily Diary) No memorandum of conversation for that meeting has been found.
16. Brackets are in the original. Reference to Mondale’s January 26 visit to West Berlin. For a record of Mondale’s speech on that occasion, see “Speech at City Hall, Berlin,” Department of State Bulletin, March 7, 1977, pp. 186–187. On July 13, Carter hosted a State dinner for Schmidt from 8:10 to 10:20 p.m., and Carter and his wife met alone with Schmidt and his wife in the White House residence from 11:15 p.m. until 12:10 a.m. on July 14. (Carter Library, President’s Daily Diary, July 13, 1977) On July 14, Carter met again with Schmidt in the Cabinet Room from 10 to 11:35 a.m. (Memorandum of Conversation, July 14; Carter Library, National Security Affairs, Brzezinski Material, Subject File, Box 35, Memcons: President: 7/77)