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Germany (FRG) - Chancellor Schmidt (2)
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Germany (FRG) - Chancellor Schmidt (2)
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Presidential Correspondence with Foreign Leaders (Ford Administration)
Presidential Correspondence with Foreign Leaders
subjects
Germany (West)
North Atlantic Treaty Organization. (4/4/1949 - )
Economics
Gold
Petroleum
Summit meetings
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1555807
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1976-03-31
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3
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1976
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1975-05-01
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5
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1975
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The original documents are located in Box 2, folder "Germany (FRG) - Chancellor
Schmidt (2)" of the National Security Adviser's Presidential Correspondence with
Foreign Leaders Collection at the Gerald R. Ford Presidential Library.
Copyright Notice
The copyright law of the United States (Title 17, United States Code) governs the making of
photocopies or other reproductions of copyrighted material. Gerald Ford donated to the United
States of America his copyrights in all of his unpublished writings in National Archives
collections. Works prepared by U.S. Government employees as part of their official duties are
in the public domain. The copyrights to materials written by other individuals or organizations
are presumed to remain with them. If you think any of the information displayed in the PDF is
subject to a valid copyright claim, please contact the Gerald R. Ford Presidential Library.
THE WHITE HOUSE
WASHINGTON
May 3, 1975
Dear Mr. Chancellor:
The current balance of payments offset agreement between
the Federal Republic of Germany and the United States of
America will expire on June 30th of this year.
Recent years have brought major developments in the inter-
national economic arena, some of which have significance
for our arrangements to offset the balance-of-payments
cost the United States incurs through the deployment of
American forces in the Federal Republic. However, while
much has changed since our two countries concluded the
first bilateral offset agreement in 1961, the most important
considerations have remained constant:
-- Like my predecessors I remain committed to the
maintenance of U.S. forces in Europe at present levels,
subject only to such mutual and balanced reductions as may
result from negotiations now underway between members of
the Atlantic Alliance and the Warsaw Pact. Given the con-
tinuing buildup of Warsaw Pact forces and the grave uncer-
tainties now confronting NATO throughout the Mediterranean
region, I believe that the U.S. military presence in Europe
is as vital today for the security of the Alliance as at any
previous time. As you know, we are taking steps to render
our commitment more effective through the substitution of
additional combat forces for a certain number of supporting
troops.
Through the years we have found burdensharing
arrangements such as balance of payments offset effective
and in fact essential to ensure sufficient political support
in the United States for our policy to continue the American
military presence in NATO Europe. The cost of maintaining
this presence is substantial both in absolute terms and rela-
tive to the size of the U.S. economy.
FORD
&
GERALD
Digitized from Box 2 of the NSA Presidential Correspondence with Foreign Leaders Collection at the Gerald R. Ford Presidential Library
An extensive and thoughtful review of all factors bearing
on this subject has led me to conclude that a continuation
of our bilateral offset arrangement serves the vital inter-
est of both our countries and that such arrangements re-
main warranted by economic and political considerations.
Hence I would like to propose to you that we appoint and
instruct negotiators to meet as soon as practicable to dis-
cuss the parameters, time span and composition of a
realistic new offset agreement which would take effect on
July 1, 1975. It is my hope that negotiations leading to
conclusion of such a new agreement could be completed
prior to that date, but in any case well before the end of
this year. I look forward to receiving your response to
this proposal.
With best personal
Heard regards, R. Ford
His Excellency
Helmut Schmidt
Chancellor of the Federal Republic of Germany
Bonn
SEINER EXZELLENZ
DEM AUSSENMINISTER DER
VEREINIGTEN STAATEN VON AMERIKA
DR. HENRY A. KISSINGER
WASHINGTON, D.C.
BONN, DEN 9. MAI 1975
LIEBER HENRY,
SIE HABEN MIR IN EINEM BRIEF, DER AM 29. APRIL IM
BUNDESKANZLERAMT EINGING, UEBER IHRE BESORGNISSE WEGEN DER
FRANZOESISCHEN HALTUNG ZUR BETEILIGUNG AN DER NATO-
GIPFELKONFERENZ IN BRUESSEL GESCHRIEBEN.
ICH VERSTEHE UND TEILE IHRE BESORGNISSE. DER BUNDESMINISTER
DES AUSWAERTIGEN HAT SCHON AM 21. APRIL IN EINEM VIER-AUGEN-
GESPRAECH DEM FRANZOESISCHEN STAATSPRAESIDENTEN UNSERE
BESORGNISSE DARGELEGT UND EINE BETEILIGUNG FRANKREICHS AUF
HOECHSTER EBENE BEFUERWORTET.
DAS GLEICHE HABE ICH JETZT IN EINEM TELEFONGESPRAECH MIT
GISCARD D'ESTAING GETAN. ICH HABE IHM FUER DEN FALL, DASS ER
SELBST NICHT NACH BRUESSEL REISEN KOENNE, DRINGEND GERATEN,
PREMIERMINISTER CHIRAC MIT SEINER VERTRETUNG ZU BEAUFTRAGEN.
DER PRAESIDENT HAT SICH IN BEIDEN FAELLEN AUSWEICHEND GEAEUSSERT.
ER SAGTE, ER NEHME UNSERE BEDENKEN ERNST, MUESSE ABER NOCH
UEBERLEGEN UND WERDE UNS SO BALD WIE MOEGLICH SEINE
ENTSCHEIDUNG MITTEILEN.
BEI MEINEM GESPRAECH HATTE ICH DEN EINDRUCK, DASS LEIDER EINE
GEWISSE VERHAERTUNG IM FRANZOESISCH-AMERIKANISCHEN VERHAELTNIS
EINGETRETEN IST UND DASS DAS RELATIV GUENSTIGE KLIMA NACH
MARTINIQUE UNTER DEM MISSERFOLG DER PARISER VORKONFERENZ
GELITTEN HAT.
ICH HOFFE SEHR, DASS ES GELINGT, WENIGSTENS EINE VERTRETUNG
FRANKREICHS DURCH HERRN CHIRAC IN BRUESSEL ZU ERREICHEN. DAFUER
WERDE ICH MICH WEITER EINSETZEN.
MIT DEN BESTEN GRUESSEN
IHR
HELMUT SCHMIDT
BUNDESREPUBLIK DEUTSCHLAND
DER BUNDESKANZLER
OUNQUOTE.
SECRELIMDIS
XGDS1
BT
DECLASSIFIED
E.O. 12958, SEC. 3.5
STATE DEPT, GUIDELINES State Review 9/16/03
BY labr
NARA DATE 3/5/04
NNNN
1. PLS PASS FOLLOWING TO WHITE HOUSE DUTY OFFICER:
A
- THIS IS TO CONFIRM TELCON BETWEEN WHITE HOUSE DUTY OFFICER AND
CAPT WEISHAR, 1345Z 7 JUN. CHANCELLOR SCHMIDT, MINISTER APEL,
AND PRESIDENT KLASEN ARE ALL AT THEIR RESPECTIVE HOMES IN
HAMBURG. THE LETTER FROM PRES FORD WAS DELIVERED TO DR LEISTER
(LEITER DES BUEROS DES BUNDESKANZLERS) WHO, EXCEPT FOR THE
CHANCELLOR'S PRIVATE SECY, IS MY ONLY AUTHORIZED CONTACT. I WAS
INFORMED THAT THE CHANCELLOR HAD SCHEDULED A SPECIAL CABINET
MEETING AT GYMNICH (NEAR BONN) FOR 1000 ON MON 3 JUN TO DISCUSS
PETROLEUM AND OTHER COMMODITIES AS WELL AS CERTAIN EFFECTS ON
THIRD WORLD COUNTRIES. THE CHANCELLOR WAS SCHEDULED TO DEPART
HAMBURG AT 0815 MONDAY ARRIAINGHBONN AT 0915 AND DEPARTING FOR
THE CABINET MEETING AT 0930. UPON BEING NOTIFIED OF PRES
FORD INVITATION TO HAVE SECY SIMON TRAVEL TO BONN, THE CHANCELLOR
MOVED UP HIS DEPARTURE FM HAMBURG AS WELL AS POSTPONED THE HOUR FOR
THE CABINET MEETING IN ORDER TO HAVE AN HOUR FREE TO MEET WITH SECY
SIMON ON MONDAY MORNING. THE MEETING IS SCHEDULED FOR 0900 TO 1000
AT THE PALAIS SCHAUMBURG. MINISTER APEL WILL BE IN ATTENDANCE AT
THE 1933 MEETING. MINISTER APEL IS NOT EXPECTED TO ATTEND THE SPECIAL
CABINET MEETING SO HE WILL BE FREE TO CONTINUE BEYOND 1000 IN
DISCUSSION WITH SECY SIMON AND WILL THEN ACCOMPANY SECY SIMON
TO PARIS.
WE HAVE NOT YET BEEN ABLE TO CONTACT PRES KLASEN IN HAMBURG. AS SOON
AS HE IS CONTACTED, DR LEISTER WILL PHONE ME IN FRANKFURT AND I
SHALL PASS THE WORD TO THE DUTY OFFICER AT THE WHITE HOUSE. WE
EXPECT TO BE IN CONTACT WITH PRES KLASEN SOMETIME THIS EVENING.
XGDS1
BT
DECLASSIFIED
E.O. 12958, SEC. 3.5
STATE DEPT, GUIDELINES
BY
NARA DATE 3/5/04
LIBRARY
NNNN
SECRET
3B
THE WHITE HOUSE
WASHINGTON
June 6, 1975
Dear Mr. Chancellor:
The Ministerial Meeting of the IMF Interim Committee next
week presents an important opportunity to move the inter-
national monetary system forward. At the same time it is
an opportunity for a responsible reaction to the current
needs of a number of seriously affected less developed
countries. It is my understanding that our Ministers of
Finance may be close to agreement on a comprehensive
package achieving these ends, but I am informed that dis-
agreement on one aspect of future rules concerning gold
could stand in the way of such an agreement.
For our part we have tried very hard to modify our position
so as to facilitate an agreement. In recognition of pos-
sible political concerns of the French government we have
this week reluctantly indicated that we will withdraw our
previous insistence that no individual government in the
future should increase its holdings of gold if that con-
cession will suffice to reach an over-all agreement. On
the other hand, we--and I believe a number of other coun-
tries--do feel strongly that some safeguards are necessary
to ensure that a tendency does not develop to place gold
back in the center of the system. We must ensure that
there is no opportunity for governments to begin active
trading in gold among themselves with the purpose of cre-
ating a gold bloc or reinstating reliance on gold as the
principal international monètary medium. In view of the
world-wide inflation problem, we must also guard against
any further large increase of international liquidity. If
governments were entirely free to trade with one another at
market-related prices, we would add to our own common infla-
tion problem.
Of course, we must ensure at the same time that gold is not
immobilized. Any government faced with an extreme finan-
cial need must be able to sell its gold to another govern-
FORD
ment. We propose, therefore, that the 10 major countries
&
GERALO
LIBRARY
2
agree that no one of them will purchase gold from another
government unless the selling government is faced with
needs arising from an extreme financial position. In my
judgment that rule would give ample flexibility for all
legitimate future trading of gold, while giving a reasonable
protection against abuse of the newly established freedom
for governments to buy gold.
I would urge you to give this important matter your personal
attention in the hope that your representative at these
meetings could be in a position to agree to arrangements
along this line. If you are available to meet with Secretary
Simon on Monday morning, June 9, I would be glad to have him
visit you and Minister Ape1 at that time for further dis-
cussion of the matter. If you would like to have President
Klasen present, Chairman Burns would also be prepared to fly
up from Basle to join the meeting. They would, however, have
to leave Bonn in time to reach the scheduled meeting of the
G 5 Ministers in Paris at 1:00 p.m. Secretary Simon would,
of course, be delighted to have Minister Apel, President
Klasen and other members of the German delegation join him
for the flight to Paris.
Sincerely,
Herald R. 3nd
His Excellency
Helmut Schmidt
Chancellor of the Federal Republic of Germany
Bonn
]
30
THE WHITE HOUSE
LDX
WASHINGTON
CONF IDENTIAL
EYES ONLY
June 6, 1975
FOR:
LARRY EAGLEBURGER
OM:
BRENT SCOWCROFT
The attached is a draft outcome of the Gold
Meeting yesterday for the President's
approval.
HAK should see it right away!
Attachment
DECLARCIFIED
E.O. 12958, SEC. 3.5
NSC MEMO, 11/24/98, STATE DEPT. GUIDELINES
BY Non
, NARA, DATE 3/5/04
CONFIDENTIAL / EYES ONLY
THE WHITE HOUSE
WASHINGTON
Dear Mr. Chancellor:
The Ministerial Meeting of the IMF Interim Committee next
week presents an important opportunity to move the inter-
national monetary system forward. At the same time it is
an opportunity for a responsible reaction to the current
needs of a number of seriously affected less developed
countries. It is my understanding that cur Ministers of
Finance may be close to agreement on a comprehensive
package achieving these ends, but I am informed that dis-
agreement on one aspect of future rules concerning gold
could stand in the way of such an agreement.
For our part we have tried very hard to modify our position
so as to facilitate an agreement. In recognition of pos-
sible political concerns of the French government we have
this week reluctantly indicated that we will withdraw our
previous insistence that no individual government in the
future should increase its holdings of gold if that con-
cession will suffice to reach an over-all agreement. On
the other hand, we--and I believe a number of other coun-
tries--do feel strongly that some safeguards are necessary
to ensure that a tendency does not develop to place gold
back in the center of the system. We must ensure that
there is no opportunity for governments to begin active
trading in gold among themselves with the purpose of cre-
ating a gold bloc or reinstating reliance on gold as the
principal international monetary medium. In view of the
world-wide inflation problem, we must also guard against
any further large increase of international liquidity. If
governments were entirely free to trade with one another at
market-related prices, we would add to our own common infla-
tion problem.
Of course, we must ensure at the same time that gold is not
immobilized. Any government faced with an extreme finan-
FORD
cial need must be able to sell its gold to another govern-
R
ment. We propose, therefore, that the 10 major countries
GEHALD
2
agree that no one of them will purchase gold from another
government unless the selling government is faced with
needs arising from an extreme financial position. In my
judgment that rule would give ample flexibility for all
legitimate future trading of gold, while giving a reasonable
protection against abuse of the newly established freedom
for governments to buy gold.
I would urge you to give this important matter your personal
attention in the hope that your representative at these
meetings could be in a position to agree to arrangements
along this line. If you are available to meet with Secretary
Simon on Monday morning, June 9, I would be glad to have him
visit you and Minister Ape1 at that time for further dis-
cussion of the matter. If you would like to have President
Klasen present, Chairman Burns would also be prepared to fly
up from Basle to join the meeting. They would, however, have
to leave Bonn in time to reach the scheduled meeting of the
G 5 Ministers in Paris at 1:00 p.m. Secretary Simon would,
of course, be delighted to have Minister Apel, President
Klasen and other members of the German delegation join him
for the flight to Paris.
Sincerely,
His Excellency
Helmut Schmidt
Chancellor of the Federal Republic of Germany
Bonn
3E
THE WHITE HOUSE SITUATION ROOM
TIME SENT:
RECEIVED:
'75 JUN 6-AM 11:43
DX NR: 654
PAGES: 3
IA
DIA/G
DESCRIPTION/CONMENT
TATE X
DIA/H
IMCC
TREAS
NMCC
NPIC
SA
ERDA
Eyes ONly
ROM: GeN. Seoweroft
O: Larry Eagleburger
staffing
Cy to HAK
EMBASSY
OF THE
FEDERAL REPUBLIC OF GERMANY
WASHINGTON, D.C.
May 13, 1975
My dear Mr. President,
Chancellor Helmut Schmidt has asked me to transmit to you
the following telegram:
"
Bundesrepublik Deutschland
Bonn, den 12. Mai 1975
Der Bundeskanzler
Seiner Exzellenz
dem Präsidenten der Vereinigten
Staaten von Amerika
Herrn Gerald Ford
Washington
Sehr geehrter Herr Präsident,
ich danke Ihnen für Ihre schnelle und positive Antwort
auf mein Schreiben vom 21. April zur Frage der privaten
Treffen von Sachverständigen für Erdöl -und Finanzierungs-
fragen. Mir scheint es in unserem gemeinsamen Interesse
zu liegen, wenn wir möglichst bald ein Treffen von priva-
ten Experten aus Produzenten -und Verbraucherländern
zustandebringen, Da sich unsere Experten bereits zweimal
getroffen haben, zweifle ich nicht, dass diese Gruppe
die Gespräche mit Experten aus den Produzentenländern
von einer gemeinsamen Basis aus führen wird. Andererseits
halte ich es für wichtig, dass jeder Teilnehmer die ihn
interessierenden Themen zur Diskussion stellen kann. Ge-
rade darin besteht ja der Unterschied zu Konferenzen
offizieller Regierungsvertreter, bei denen schon die Eini-
gung über die Tagesordnung ein erhebliches Problem dar-
stellt.
FORD
The President
The White House
Washington, D.C.
DECLASSIFIED
E.O. 12958, SEC. 3.5
STATE DEPT, GUIDELINES State Review 9/16/03
BY
NARA DATE
3/5/04
-2-
In zwei Gesprächen, die ich inzwischen mit dem Iranischen
Wirtschaftsminister geführt habe, habe ich ihm erklärt,
dass die Schwierigkeiten, die einem gemischten Experten-
treffen auf unserer Seite bisher entgegenstanden, jetzt
überwunden sind, Bisher hätten zwei Treffen von Experten
aus funi Verbraucherländern stattgefunden. Die Regierungen
dieser Länder hätten sich vcn der Nützlichkeit solcher
Treffen überzeugt. Die Zeit sei jetzt reif, um ein Treffen
mit Experten aus dem Iran, Saudi Arabien, Algerien und
Venezuela zu arrangieren.
Herr Ansary hat mir mitgeteilt, dass der Schah private Ex-
pertentreffen noch immer für nützlich hält. Er möchte aber,
anders als im März, nicht selbst s die Initiative gegenüber
den Produzentenländern ergreifen. Offenbar will er sich
nicht dem Vorwurf aussetzen, er breche die Solidarität der
Produzentenländer nach der Pariser Vorkonferenz. Aus dem
gleichen Grund ist er an strengste Vertraulichkeit interes-
siert.
Ich habe Herrn Ansary gesagt, dass ich Sie bitten werde,
sich an Präsident Perez von Venezuela zu wenden und ihn auf-
zufordern, einen Sachverständigen seines Landes zu benennen.
Der Schah hat in Caracas -wie Herr Ansary mir sagte- nur
in allgemeiner Form sein Interesse bekundet, alle Möglich-
keiten zu nutzen, um eine Annäherung zwischen den Auf-
fassungen der Erzeuger -und der Verbraucherländer zu er-
reichen.
Zunächst muss aber wohl sichergestellt werden, dass auch
Algerien sich an einem Expertentreffen beteiligt. Ich habe
Präsident Giscard d'Estaing gebeten, die Initiative gegen-
über Algerien zu übernehmen. Er hat Zweifel, ob Präsident
Boumedienne zustimmen wird. Das Ergebnis seiner Bemühungen
bleibt abzuwarten.
Wenn die Beteiligung Venezuelas und Algeriens gesichert ist,
werden wir unseren Botschafter anweisen, mit dem Kronprinzen
-3-
von Saudi Arabien Verbindung aufzunehmen. Er wird ihn
unter Bezug auf das von Minister Genscher in Djidda
geführte Gespräch um die Benennung eines saudischen
Experten bitten.
Der wichtigste Punkt für Herrn Ansary war, dass jeder
Teilnehmer an dem Treffen jedes Thema zur Diskussion
stellen kann. Die Experten sollen weder Auflagen ihrer
Regierungen haben, noch ihre Regierungen binden können.
Ich habe ihm bestätigt, dass dieses Prinzip auch für
die bisherigen Treffen gegolten und sich bewährt hat.
Das erste Treffen der gemischten Gruppe könnte auf Ein-
ladung des deutschen Teilnehmers in der Nähe von Frank-
furt stattfinden und ein bis zwei Tage dauern. Verhand-
lungssprache würde Englisch sein. Danach berichten die
Experten an die Regierungen ihrer Länder, eventuell ver-
bunden mit dem Vorschlag, weitere Treffen abzuhalten.
Ich werde Sie unterrichten, ob Präsident Boumedienne
auf die französische Anfrage positiv reagiert. Ihnen wäre
ich dankbar, wenn Sie dann möglichst bald an Präsident
Perez herantreten wollten.
Mit freundlichen Grüssen
Ihr
Helmut Schmidt "
A courtesy translation reads as follows:
11 Federal Republic of Germany
Bonn, May 12, 1975
The Chancellor
His Excellency
the President of the United States
of America
Mr. Gerald Ford
Washington
Dear Mr. President,
thank you for your early and favourable reply to my
letter of 21 April concerning a private meeting of
experts on oil and financing questions. It would seem
to be in our mutual interest for a private meeting of
experts from producer and consumer countries to be
held as soon as possible. As our experts have already
met twice, I have no doubt that this group will conduct
their talks with experts from the producer countries
on a common basis. On the other hand, I think it is
important that each participant should be able to put
forward for discussions the points that are of interest to
him. This is precisely where such a meeting differs from
conferences of official government representatives where
even reaching agreement on the agenda is a considerable
problem.
In two discussions I have meanwhile had with the Iranian
Minister of Economics, I told him that the problems that
had from our point of view stood in the way of a mixed
meeting of experts had been overcome, that up to then
two meetings had taken place between experts from five
consumer countries, and that the governments of those
countries were convinced of the value of such meetings.
I informed him that the time was now ripe for a meeting
with experts from Iran, Saudi Arabia, Algeria and Venezuela.
Mr. Ansary informed me that the Shah still felt private
meetings of experts were valuable but did not wish, as
in March, himself to take the initiative vis-a-vis the
producer countries. Apparently he is anxious not to leave
himself open to the charge of breaking the solidarity of
the producer countries following the preparatory con-
ference in Paris. For the same reason he wants the matter
to be kept strictly confidential.
I told Mr. Ansary that I would request you to approach
President Perez of Venezuela with a view to his naming
a venezuelan expert. According to Mr. Ansary, the Shah,
whilst in Caracas, spoke in only general terms about
wanting to use all possible means of approximating the
views of producer and consumer countries.
-5-
It seems, however, that the first step should be to make
sure that Algeria will also participate in the meeting
of experts. I have asked President Giscard d'Estaing to
take the initiative with Algeria, but he doubts whether
President Boumedienne will agree, so we shall have to
await the outcome of his efforts.
Once we can be certain that Venezuela and Algeria will be
represented we shall advise our Ambassador to make con-
tact with the Crown Prince of Saudi Arabia. He will re-
fer to Foreign Minister Genscher's talks in Jidda and
ask him to nominate a Saudi expert.
The most important point in Mr. Ansary's view was that
each participant should have the right to raise any
matter for discussion. He wants the experts to be neither
under instructions from their governments nor to be able
to enter into binding commitments on their behalf. I
confirmed that this principle has been observed in
previous meetings and has proved to be a good one.
The first meeting of the mixed group could take place at
the invitation of the German participant somewhere near
Frankfurt and last one or two days. The experts would
hold their discussions in English and afterwards report
back to their governments and possibly suggest further
meetings.
I shall inform you whether President Boumedienne has
replied favourably to the French inquiry. I would be
grateful if you would then approach President Perez as
soon as possible.
With warm regards,
Sincerely,
sgd. Helmut Schmidt"
Respectfully yours
VIA SPECIAL NAVY CHANNEL
SECRET/EYES ONLY
May 23, 1975
FOR:
Chancellor Helmut Schmidt
FROM:
Secretary Henry A. Kissinger 10
1.
As you will recall, on the occasion of our breakfast on
Wednesday, we discussed the nature of your remarks and those of
President Ford at the NATO summit.
2.
I am pleased to enclose the current draft of the President's
speech, which, of course, remains subject to revision. As I know
you will appreciate, this is being sent solely for your personal informa-
tion. With regard to your own remarks to the NATO summit, I would
hope you will, indeed, address the economic issues facing all of us.
Warm regards. Text of Speech follows:
BEGIN TEXT - QUOTE
DECLASSIFIED
E.O. 12958, SEC. 3.5
NSC MEMO, 11/24/98, STATE DEPT. GUIDELINES
SECRET / EYES ONLY
BY WA
, NARA, DATE 3/5/04
DEPARTMENT OF STATE
BRIEFING PAPER
SM
QUOTE
DRAFT PRESIDENTIAL STATEMENT
In 1949, President Truman transmitted the text
of the North Atlantic Treaty to the Congress of
the United States with his assessment of its
importance. "Events of this century," he wrote,
"have taught us that we cannot achieve peace in-
dependently. The world has grown too small." He
described the interdependence of the North Atantic
nations in a way that is as accurate today as it
was then: "The security and welfare of each member
of this community depends on the security and wel-
fare of all. None of us alone can achieve economic
prosperity or military security. None of us alone
can assure the continuance of freedom."
A year ago, on the 25th anniversary of the
signing of the North Atlantic Treaty, NATO leaders
met here in Brussels to celebrate an Alliance that
had fulfilled its promise by providing for the
security, promoting the welfare and maintaining
the freedom of its members.
We are here today to renew our commitment to
the Alliance, to remind our citizens in the fifteen
SECRET
GDS
&
3/5/04.
SECRET
-2-
member nations by our presence of the strength and
stability of the transatlantic ties that bind us, and
to restate our pledge to collective self-defense. We
are also here to address the serious problems we face
in this complex and volatile world, and to review the
steps we must take to deal with them.
Since a renewal of our commitment to the Alliance
is the most important of these purposes, let me begin
by stating unconditionally and unequivocally that the
United States will remain true to the commitments
undertaken when we signed the North Atlantic Treaty,
including the obligation in Article 5 to come to the
assistance of any NATO nation subjected to armed
attack. As treaties are the supreme law of our land,
these commitments are juridically binding in the
United States. I consider them also to be strategically
and politically essential and morally justified. They
enjoy broad Congressional and popular support in America
as well. They thus remain a firm foundation, as they
have been for twenty-six years, on which our relation-
ship can rest -- a foundation that has served the pur-
poses for which it was created and that can continue to
serve these purposes in the face of new difficulties
as long as we who built it wish it to do SO.
SECRET
SECRET
-3-
In the treaty we signed twenty-six years ago,
and from which we drew confidence and courage, we
pledged:
-- To live in peace with all peoples and all
governments.
-- To safeguard the freedom, common heritage
and civilization of our peoples founded on the
principles of democracy, individual liberty and the
rule of law.
-- TO promote stability and well-being in the
North Atlantic area.
-- To settle any international dispute in
which any of us may be involved by peaceful means.
-- To eliminate conflict in international
economic policies and encourage economic collaboration.
-- To maintain and develop our individual and
collective capacity to resist armed attack, by means
of continuous and effective self-help and mutual aid.
-- To consult together when any one of us is
threatened.
-- To consider an armed attack against one as
an armed attack against all.
SECRET
FORD
&
GERALD
AND
SECRET
-4-
I doubt that any of us could improve on that
statement of principles and purposes which is as
valid today as it was then. It is, however, worth
reminding ourselves of these pledges as we turn our
attention and energies to the problems we face today
both outside and within the Alliance -- problems
very different from those we faced twenty-six years
ago. No purpose would be served by not acknowledging
the problems confronting us. Had we not done so
twenty-six years ago, had we hidden our heads in
the sand of oblivion, we obviously would not have
succeeded in achieving the purposes of this Alliance.
We have a duty to ourselves to be equally frank
today, and so I will cite a number of problems that
concern me:
-- In the Middle East, there remains a possi-
bility of a new war, a war that could not only
involve the countries in the area but also SOW seeds
of discord beyond the Middle East itself, perhaps
even within our Alliance.
-- In Indochina, the events of recent months
have resulted in enormous human suffering for the
people of Cambodia and Viet-Nam, suffering that
SECRET
SECRET
-5-
touches all our hearts. Because of our long involve-
ment in Indochina, these events have led some to
question our strength and reliability. I believe
that our strength speaks for itself -- our economy
is recovering rapidly from last year's recession,
our military power remains -- and will continue to
remain -- second to none, and our political system
has, I believe, emerged from the shocks of the past
year stronger for the way in which it met the severe
tests it has undergone. I trust that my statement
earlier in these remarks will erase some of the
doubts about our reliability. I am confident that
our actions in the future will surely erase the
remainder.
-- In the field of energy, we are still not
immune from the political pressures that could
result from a heavy dependence on foreign sources
of energy, although we have made considerable
progress in offsetting the effect of the action
taken last year by the major oil producing countries.
We have far more to do, however.
-- Within the Alliance, two of our Allies have
clashed in the past year and one of them has been
cut off by another from an established source of
SECRET
SECRET
-6-
military support; one Ally has qualified its military
relationship with NATO; and in another there has been
talk of nonalignment. Finally, there are problems
that relate directly to our defense capabililites.
Some Allies have felt compelled to reduce their
military commitments to NATO despite the fact that
the forces potentially hostile to us have grown
stronger in quantity and quality. We also face
basic problems of effectiveness. A generation
after its creation, our Alliance loses billions
of dollars each year and pays a high price in
military effectiveness because, in some cases, we
have not standardized weapons and, in other cases,
we have not agreed among ourselves on a division
of responsibility regarding equipment development
or production.
This is a formidable array of problems. But
they are no more serious than those we have faced
before, and some of them are the same. Let us
address them with all the courage, conviction and
cohesion of which the members of this Alliance are
capable.
SECRET
SECRET
-7-
I propose that we pledge ourselves to six tasks
in the year ahead:
-- First, let us maintain a strong and credible
defense. This must be the first task of the
Alliance, for if we fail in this task, the others
will be irrelevant. A society that does not have
the vigor and dedication necessary to defend itself
cannot, by definition, survive. Neither can an
Alliance. For my part, as President, I will not
engage in any unilateral reduction of US forces
committed to NATO. We must take steps toward a
more effective use of our defense resources.
Let us strive for common procedures and equipment.
We should make our research and development efforts
much more than the sum of individual parts. Let us
move in the direction of being truly one Alliance
in our defense efforts. Reductions in defense
budgets cannot be turned to our advantage. But
efficiency can be.
-- Second, let us preserve the quality and
integrity of this Alliance on the basis of un-
qualified participation, not on the basis of
partial membership or special arrangements. The
SECRET
SECRET
- -8-
commitment to collective defense must be complete
if it is to be credible. It must be reciprocal
if it is to be- reliable.
-- Third, let us improve the process of political
consultation. We have done well but there is room for
improvement by all parties if we are to maintain our
solidarity as we seek to reduce the tensions that
have existed with the Soviet Union and its allies
for more than a quarter of a century. More than
simply informing one another of our views and
intentions, we should cultivate the habit of dis-
cussing our approaches to those matters which touch
the interests of us all so that we can develop
common policies to deal with common problems.
-- Fourth, let us cooperate in developing an
imaginative, productive and realistic agenda for
detente -- an agenda that serves our interests and
not just those of others who do not share our values
and who may seek to exploit any weakness they perceive
among us. One item on that agenda should be to
insure that the promises made in the Coference on
Security and Cooperation in Europe are translated
into action to advance freedom and human dignity
STCRET
SECRET
-9-
for all Europeans. Only by such realistic steps can
we keep CSCE in perspective, whatever euphoric or
inflated emphasis the USSR or other participants
may wish to give it. Another item on that agenda
should be the negotiations on mutual and balanced
force reductions in Europe. We in NATO should be
prepared to make new proposals in these negotiations.
But the Soviet Union and its allies should also be
prepared to respond in good faith for the common
objectives surely both sides should want --
undiminished security -- for all but at a lower
level of forces. What better way could there be
to commemorate the thirtieth anniversary year of
the end of World War II.
--- Fifth, let us look to the future of the West
itself. We must strengthen our own democratic
institutions, not by yielding to slogans or the
temptations of collaboration with totalitarian
parties, but by encouraging the growth of democratic
institutions. Let us also look beyond our Alliance
as it stands today. I believe we should begin now
to consider how to integrate Spain more fully into
Western society and how to associate it more closely
FORD
SECRET
GERALD
LIBRARY
SECRET
-10-
with Western defense. Spain has already made, and
continues to make, an important contribution to
Western military security as a result of its bi-
lateral relationship with the United States. The
Alliance could provide a framework for an even more
effective Spanish military contribution and closer
political ties.
-- Sixth, let us rededicate ourselves to the
Alliance as a joint great enterprise, as a commitment
to follow common approaches to shared aspirations
covering a broad range of human activity. We must
build on the valuable contribution our Alliance
already makes in helping to cope with the environ-
mental problems that afflict industrialized
societies. We should address the problems of
population, food and raw materials. We must find
ways to strengthen the world trading and monetary
system, and to meet the imperatives of energy
development and conservation. With our wealth and
technological skills, we can make a valuable
contribution towards solving these problems and
thus improving the standard of life in all of our
countries. But we can do so most effectively only
if we work together.
ORD
SECRET
LIBRARY
SECRET
-11-
These six tasks of the Alliance illustrate how
complex the world has become and how much more
difficult it ïs to manage the Alliance than was the
case a generation ago. Then, our problems were
relatively simple to define, and it was consequently
easier to agree on common solutions behind which to
unite. Today the problem of definition is more
complicated, and in many of our countries there has
been a fragmentation of public and parliamentary
opinion which has made it more difficult for
governments to mobilize support for courses of
action they wish to follow. Then, there was a
certain common appreciation among our citizens as
to their goals as individuals and the goals they
wished for their nations. Today, there is less
certainty and greater diversity within our bodies
politic.
But there are constants as well, and they
are --- in the final analysis -- more important
than the variables. Together we constitute the
greatest reservoir of economic and military
strength in the world. Let us use that strength
to attack the grave problems that confront us
SECRET.
FORD
LIBRARY
SECRET
-12-
now. Together we share and represent the same
common traditions, purposes and values. Let us
use these common bonds to mobilize our energies
and will at this difficult time.
We have every reason to be proud of NATO's
past. We have every reason to be confident of
the Alliance's future. END. END QUOTE
NATO
May 1975
SECRET
MEMORANDUM
4453
NATIONAL SECURITY COUNCIL
ACTION
July 7, 1975
OBE
OBE
MEMORANDUM FOR:
GENERAL SCOWCROFT
FROM:
ROBERT HORMATS
OUH
SUBJECT:
Letter from West German Chancellor Schmidt
Chancellor Schmidt's letter (Tab A) thanks the President for sending
Simon and Burns to meet with him in Bonn in early June and, among
other things, expresses appreciation for the close cooperation he and
the President enjoy in the field of economic policy. Further, Schmidt
expresses satisfaction at the growing confidence in the US that the
American economy has already reached its low point, and indicates
that he would be relieved if there were an economic upswing in the US
in the second half of 1975.
Your memorandum for the President (Tab 1) summarizes Schmidt's
letter and gives a brief synopsis of Schmidt's latest press conference,
concluding that Schmidt's major objective is to point out the adverse
impact of international developments on the German economy to convince
Germans that he should not be blamed for the country's economic problems.
RECOMMENDATION:
That you sign the memorandum for the President at Tab I. Denis Clift
concurs.
MEMORANDUM
4453
60
THE WHITE HOUSE
WASHINGTON
CONFIDENTIAL
INFORMATION
MEMORANDUM FOR:
THE PRESIDENT
FROM:
BRENT SCOWCROFT
SUBJECT:
West German Chancellor Schmidt's
Economic Views
Chancellor Schmidt's letter (Tab A) thanks you for sending Simon and
Burns to meet with him in Bonn early in June, expresses his satisfaction
at the growing confidence in the US that the American economy has
already reached its low point, indicates that it would be a relief to
him if there were an upswing in the US in the second half of 1975, and
expresses appreciation for the close cooperation you and he enjoy in
the field of economic policy and the spirit of confidence, which also
characterizes contacts between German and US central banks and
their presidents.
Schmidt, as you know, sees the current world recession (which has
contributed to historically high levels of unemployment in post-war
Germany) as the major danger for the West. In a June 24 press
interview he said that synchronized inflationary and deflationary
pressures will be a permanent characteristic of the world economic
future. In the present cycle, Schmidt says that the quadrupling oil
prices, inflation, and the destabilizing effect on trade of discontinuing
fixed exchange rates have been mutually intensified by their coincidence.
This analysis leads him to emphasize international cooperation and
coordination of economic policies as the key to overcoming problems.
He feels cooperation and coordination with the US has been sufficient
but criticizes Japan, Italy, and the UK. He regards recovery in the
US, because of its economic effects, as well as its psychological and
political impact in dispelling pessimism, as a key factor in stimulating
recovery in Germany and elsewhere.
In a subsequent press conference on June 25, Schmidt stated that the
pronounced downswing of a world recession is likely to be followed by
a "mutually propellant" upswing, suggesting that he foresees the danger
of possible excesses and an attendant increase in inflation. He concluded
that both the US and FRG governments are aware that an upturn in the
world economy is hardly conceivable without a strong economic recovery
in the US.
CONFIDENTIAL - GDS
3/5/04
CONFIDENTIAL
2
The sum of Schmidt's remarks pointing out the adverse impact of
international developments on the German economy--which Schmidt
had predicted would turn upward by early summer but which shows
no signs of doing so--is to make Germans aware that external forces
have worked against Germany and that he should not be blamed for the
country's economic problems.
CONFIDENTIAL - GDS
6
4453
EMBASSY
OF THE
FEDERAL REPUBLIC OF GERMANY
WASHINGTON, D.C.
June 26, 1975
My dear Mr. President:
The Chancellor of the Federal Republic of Germany has
asked me to transmit to you the following telegram:
"Sehr geehrter Herr Präsident,
Es war mir ein grosses Vergnügen, am Montag, den
9. Juni, Gelegenheit zu einer Unterhaltung mit Herrn
William Simon, Secretary of the Treasury, und Herrn
Arthur Burns, Chairman of the Federal Reserve Board,
zu haben.
Ich bedanke mich sehr für Ihre Botschaft vom 6. Juni,
mit der Sie diese Begegnung veranlaßt haben.
Leider war die Zeit für eine vertiefte Erörterung aller
angeschnittenen Fragen wegen einer seit längerem anbe-
raumten Kabinettsitzung außerhalb Bonns etwas knapp. Ich
habe jedoch mit großer Befriedigung vernommen, wie sehr
die Zuversicht in Ihrem Lande gewachsen ist, dass die
amerikanische Wirtschaft den konjunkturellen Tiefpunkt
erreicht oder schon durchschritten hat. Ich wäre sehr
erleichtert, wenn sich die Annahme eines im zweiten Halb-
jahr 1975 beginnenden Aufschwungs demnächst bestätigen
würde. Mit höchster Aufmerksamkeit verfolge ich alle aus
den USA eintreffenden Wirtschaftsnachrichten und -daten.
Die weitere Entwicklung der amerikanischen Wirtschaft
ist aufgrund ihres großen tatsächlichen und psychologi-
schen Einflusses entscheidend für das weltweite Konjunk-
turklima.
2 -
His Excellency
the President of the
United States of America
Mr. Gerald R. Ford
The White House
Washington, D.C.
- 2 -
Ich freue mich, daß die wirtschaftspolitische Koopera-
tion zwischen uns eng und vertrauensvoll ist und dass
dies auch für den engen Kontakt zwischen unseren Noten-
banken und besonders deren Präsidenten gilt.
Mit freundlichen Grüßen
stets Ihr
gez. Helmut Schmidt
"
A translation reads as follows:
"Dear Mr. President,
I was very pleased to meet Mr. William Simon, Secretary
of the Treasury, and Mr. Arthur Burns, Chairman of the
Federal Reserve Board, for talks on 9 June in Bonn.
I should like to thank you for your message of 6 June
in which you proposed that meeting.
Unfortunately, time was somewhat short for a discussion
in depth of all the problems we touched on, due to a
cabinet meeting outside Bonn which has been scheduled
for some time. However, I learnt with great satisfaction
of the growing confidence in your country that the American
economy has now reached the lowest point of the down-turn
or is, indeed, already past it. It would be a considerable
relief to me if the up-swing expected in the second half
of 1975 is confirmed in the near future. I am following
closely all the economic news and information from the
United States. The continued development of the American
economy is, in view of its great material and psychological
influence, decisive for a healthy world-wide economic
climate.
I greatly appreciate the close cooperation we enjoy in
the field of economic policy and the spirit of confidence,
which also characterizes the close contacts between our
central banks and their presidents.
With kind regards,
yours sincerely,
sgd. Helmut Schmidt
"
Respectfully,
Chargé d'Affaires a.i.
DOC
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LOG NBR
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Schmidt, FROM: KISSINGER,
MO
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)
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PROGRAM ANALYSIS
DUE DATE:
7-4
NSC PLANNING
COMMENTS: (INCLUDING SPECIAL INSTRUCTIONS)
CONGRESSIONAL
OCEANS POLICY
INTELLIGENCE
DATE
FROM
TO
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SUBSEQUENT ACTION REQUIRED (OR TAKEN):
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SPECIAL DISPOSITION:
CRT ID:
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NBC-74-21
575-600
THE WHITE HOUSE
WASHINGTON
August 31, 1975
Dear Mr. Chancellor:
Our representatives are meeting this weekend in
Washington, along with those of other countries,
to discuss some crucial issues in the international
monetary area. Resolution of these questions will
help assure the continued viability of the liberal
trade and payments system which is so essential
to world prosperity in the coming years. Sound
agreements on gold and exchange rates are clearly
important to every country. In addition, less
developed nations will particularly benefit from
the planned IMF quota increase and measures to
mobilize IMF gold.
For these reasons, I place great importance on
progress at the upcoming meetings of the Bank
and the Fund. I am, therefore, authorizing
Secretary Simon to exercise further flexibility
on the gold issue.
I hope this flexibility from the United States on
gold will pave the way for agreement on a full
package of amendments to the IMF Articles as
well as the quota increase. Obviously, the
French approach to the exchange regime issue
will be critical to working out a package. I
have, therefore, written to President Giscard
d'Estaing to urge reconsideration of the French
position.
FORD
8
OF
LIBRARY
- 2 -
Your influence will be critical in finding a common
ground on which we can all agree. I would
appreciate any efforts you feel you can appropri-
ately make to this end.
Sincerely,
Hand R.7rd
His Excellency
Helmut Schmidt
Chancellor of the Federal
Republic of Germany
Bonn
to
Gen
scowent,
EMBASSY
OF THE
FEDERAL REPUBLIC OF GERMANY
WASHINGTON, D.C.
September 4th, 1975
Confidential
My dear Mr. President,
Federal Chancellor Helmut Schmidt has asked me to transmit
to you the following telegram:
" Lieber Herr Präsident;
herzlichen Dank für Ihre beiden Botschaften vom 29. August
und .September 1975.
Das Entgegenkommen Ihrer Regierung in der Goldfrage hat
entscheidend dazu beigetragen, dass im Interimsausschuss
erfreuliche Fortschritte bei der Verteilung der aufzu-
See Gold File aignals
stockenden IWF-Quoten, der Verwendung eines Teils des
IWF-Goldes zugunsten der armen Entwicklungsländer und bei
der vorgesehenen Übereinkunft über Goldtransaktionen
zwischen den Zentralbanken erzielt werden konnten. Die
baldige Umsetzung dieser weitgehenden Einigung in die
währungspolitische Praxis sollte nicht dadurch gehemmt
werden, dass zwischen einigen Staaten -erfreulicherweise
kaum zwischen unseren beiden Regierungen- noch erhebliche
Unterschiede in der Beurteilung des künftig anzustrebenden
Wechselkurssystems bestehen. Mir erscheint der Meinungs-
streit teilweise etwas zu theoretisch, um nicht zu sagen:
dogmatisch. Deshalb erwarte ich eine Annäherung der bis-
lang unterschiedlichen Standpunkte. Eine unnötig ver-
härtete Diskussion über das künftige Währungssystem
könnte unseren gegenwärtigen Bemühungen um Wiederbele-
bung der wirtschaftlichen Aktivität, Abbau der Arbeits-
losigkeit, Bekämpfung von Inflation und Zahlungsbilanz-
ungleichgewichten leicht zuwiderlaufen.
The President
The White House
Washington, D.C.
DECLASSIFIED
E.O. 12958, SEC. 3.5
STATE DEPT, GUIDELINES
BY
NARA DATE 3/5/04
Darum werde ich alles in meinen Kräften stehende tun, um hier
undogmatisch zu vermitteln.
8B
Ich freue mich auf den Besuch von George Shultz in Bonn und
schlage als Termin für das Gespräch den 13. September 1975,
nachmittags, vor.
Mit herzlichen Grüssen
stets Ihr
Helmut Schmidt "
A courtesy translation reads as follows:
11 Dear Mr. President,
thank you very much for your two messages on 28 August and
1 September 1975.
The accomodating approach shown by your government over
the gold question was decisive in paving the way for the
gratifying progress made in the Interim Committee on the
distribution of the increase in IMF membership quotas,
the use of part of the IMF gold to benefit the poor devel-
oping countries as well as the planned agreement concerning
gold transactions between the central banks. The process
of putting the large measure of agreement achieved into
practive in terms of monetary policy should not be impaired
by the fact that between some countries -happily hardly
between our two governments- there are still considerable
differences of opinion over the future change rate system.
I feel that in a sense this conflict of views is rather
too theoretical, one might almost say dogmatic. I expect
therefore that the gap between the differing standpoints
will be narrowed. An unnecessarily tough discussion on the
future monetary system could easily damage our present
efforts to stimulate economic activity, reduce unemployment,
and fight inflation and payments imbalances. For this reason
I will do all in my power in an undogmatic spirit to play
a mediating role.
I am looking forward to the visit of George Shultz to Bonn
and suggest the afternoon of 13 September 1975 as a date for
our talks.
With warm regards
Helmut Schmidt"
Respectfully yours,
81
MEMORANDUM
THE PRESIDENT HAS SEEN
5977-6402
THE WHITE HOUSE
WASHINGTON
INFORMATION
SECRET
October 13, 1975
MEMORANDUM FOR:
THE PRESIDENT
B
grey
FROM:
BRENT SCOWCROFT
SUBJECT:
Responses from Wilson, Schmidt, and
Moro to your Letters on Gold
Prime Minister Wilson, Chancellor Schmidt, and Prime Minister Moro
have. responded to your messages of September 1 conveying a more
flexible US position on gold. In the Interim Committee, agreement was
reached on new IMF quotas, on reducing the vote required for a veto
from 20% to 15%, abolition of an official price for gold, elimination of
the obligation to use gold in transactions with the IMF, sale of one-sixth
of the Fund's gold (25 million ounces) for benefit of the developing countries,
and restitution of the same amount to its original owners.
Wilson (Tab A) believes that your additional flexibility was an important
element in the overall results of the meeting of the Interim Committee.
He hopes and believes that it will now be possible to complete in coming
months a comprehensive agreement covering, in particular, outstanding
issues relating to exchange rates.
Schmidt (Tab B) also believes that US flexibility was a significant factor
in paving the way for progress in the Interim Committee. He states that
future progress toward broader agreement should not be impaired by
differences of opinion over the future exchange rate system (viz. France
vs. the US). He expects that the gap between the different views will be
narrowed, and warns that an unnecessarily tough discussion could damage
present efforts to stimulate economic activity, reduce inflation and fight
inflation and payments imbalances. He indicates that he will do all in
his power "in an undogmatic spirit" to play a mediating role.
Moro (Tab C) states that the positive results obtained in gold and IMF
quotas were testimony of the goodwill of the US and the European Community
in dealing with world monetary problems. He affirms that Italy intends to
SEGRET/GDS
bh 3/5/04
SECRET
2
pursue discussion concerning exchange rates in the same constructive
spirit, with the goal of reaching a formula that will reconcile existing
differences. He underlines the point, made to you in Helsinki, that
Italy's ability to play a constructive role on these matters will be made
more difficult if major financial issues are discussed in meetings limited
to five countries, i.e., excluding Italy. Constructive action by Italy
"presupposes Italy's participation in all of the forums in which international
policies in the economic and monetary areas are elaborated and agreed upon."
I do not believe that replies to the three heads of government are required.
SECRET/GDS
8A
MEMORANDUM
5977-6402
NATIONAL SECURITY COUNCIL
THBI fudto Ti
10.13
is
ACTION
SECRET
October 7, 1975
MEMORANDUM FOR:
GENERAL A SCOWCROFT
FROM:
ROBERT HORMATS
ORM
SUBJECT:
Responses from Wilson, Schmidt
and Moro to President's Letters on Gold
The above noted leaders responded to the President's messages of
September 1 conveying a more flexible US position on gold. All
believe that this flexibility was an important element in the successful
meeting of the IMF Interim Committee. Should you wish to send these
to the President, a memorandum is attached at Tab 1.
RECOMMENDATION:
That you sign the memorandum to the President at Tab 1.
SECRET/GDS
do 3/5/04
- Ed File
THE PRESIDENT HAS SEEN
per 9-24-15 show 9'
seen pm
THE WHITE HOUSE
WASHINGTON
September 24, 1975
Mr. President:
Chancellor Schmidt wishes to call you
simply to express his feelings about the
recent attacks on your life. It is a purely
personal call.
He will try to place the call between 12:00
and 12:30 p.m.
B
Brent Scowcroft
Express concern + gratatude
GIRF
vis - q-vio w calf.
\
OF STATE
Department of State
of STATES UNITED THE AMERICA
TELEGRAM
CONFIDENTIAL 0784
PAGE 01 STATE 267049
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ORIGIN SS-25
INFO OCT-01 ISC-00 SSO-00 NSCE-00 CCO-00 1026 R
DRAFTED BY EB: TOENDERS
APPROVED BY S: HAKISSINGER
C: HSONNENFELDT
TREAS: GPARSKY
S/S MR. ORTIZ
S: PEBARBIAN
WH:BSCROWCROFT
DESIRED DISTRIBUTION
S,D,E, C, S/S, EB, EUR, EA, WH(SCOWCROFT), AND TREAS (SIMON) ONLY
095459
(s)
Z 1121477 NOV 75 ZFF4
AFR/UN
FM SECSTATE WASHOC
LOR/CAN
TO AMEMBASSY TOKYO FLASH
FE 1+B
AMEMBASSY ROME FLASH
LA
AMEMBASSY LONDON FLASH
NEA/SA
AMEMBASSY BONN FLASH
PRC
C ONFIDENTIAL STATE 267049
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TAGS:
EFIN
CONGR
SUBJECT: ECONOMIC SUMMIT
FOR THE AMBASSADOR
1. PLEASE DELIVER THE FOLLOWING LETTER FROM THE PRESIDENT
WITH APPROPRIATE SALUTATION TO CHANCELLOR SCHMIDT, AND
FORD
PRIME MINISTERS MIKI, MORO AND WILSON.
2. I AM WRITING TO SHARE MY THOUGHTS WITH YOU AS WE
GERALD
LIBRARY
PREPARE FOR THE MEETING AT RAMBOUILLET. ALTHOUGH WE HAVE
BEEN CAREFUL NOT TO LEAD PUBLIC OPINION TO EXPECT DRAMATIC
RESULTS, I AM CONVINCED THAT WE MUST USE THIS UNPRECEDENTED
OPPORTUNITY TO BEGIN TO LAY THE FOUNDATIONS FOR A PROLONGED
NOT TO BE REPRODUCED WITHOUT THE AUTHORIZATION OF THE EXECUTIVE SECRETARY
We 3/5/04
FORM
DEPARTMENT OF STATE
UNITED OF ?
Department of State
TELEGRAM
STATES
CONF IDENTIAL
PAGE 02 STATE 267049
PERIOD OF SHARED PROSPERITY. ON REFLECTION, IT SEEMS TO ME
THAT OUR PUBLICS AND OUR PARLIAMENTS WILL EXPECT NOTHING
LESS AND THAT WE CAN, IN FACT, ACHIEVE SUBSTANTIAL PROGRESS.
3. OUR FIRST TASK AT RAMBOUILLET WILL BE TO BUILD CONFI-
DENCE IN THE ECONOMIC RECOVERY UNDERWAY IN THE UNITED
STATES AND JAPAN AND WHICH IS BEGINNING IN EUROPE. HERE,
I BELIEVE, A CAREFUL PRESENTATION OF THE MOST RECENT
TRENDS WILL BE CONVINCING.
4. NEXT, WE NEED TO DEMONSTRATE TO OUR PUBLICS OUR INTEN-
TION TO DIRECT THE COURSE OF THE RECOVERY SO AS TO
MAINTAIN STABLE ECONOMIC GROWTH TN THE FUTURE. IN THIS
CONNECTION, WE MIGHT CONSIDER WHETHER CLOSER COOPERATION
AMONG OUR OFFICIALS RESPONSIBLE FOR ECONOMIC POLICY,
COUPLED WITH THE ARTICULATION OF JOINT GOALS FOR THE
MAJOR INDUSTRIALIZED ECONOMIES, WOULD NOT BE DESIRABLE.
THESE GOALS MIGHT BE:
--TO GENERALIZE THE RECOVERY DURING 1976 AMONG THE MAJOR
INDUSTRIAL COUNTRIES.
--TO SEEK TO RESTORE SUSTAINED VIGOROUS ECONOMIC EXPAN-
SION AND HIGH LEVELS OF EMPLOYMENT BY 1977.
--TO REDUCE INFLATION AND DISPARITIES AMONG NATIONAL
INFLATION RATES.
--TO RESTORE VIGOROUS GROWTH IN TRADE.
5. THIRD, OUR MEETING MUST COME TO GRIPS WITH THE
SPECIFIC PROBLEMS OF TRADE, MONEY AND ENERGY.
6. TRADE IS CLEARLY CRITICAL. WE SHOULD, I BELIEVE,
PROVIDE NEEDED IMPETUS TO THE MULTILATERAL TRADE NEGOTIA-
TIONS UNDERWAY IN GENEVA, SETTING 1977 AS THE DEADLINE
FOR THEIR COMPLETION AND IDENTIFYING AS OUR GOALS:
--A MAJOR CUT IN TARIFFS (NO LESS THAN THAT ACHIEVED IN
THE KENNEDY ROUND);
OT TO BE REPRODUCED WITHOUT THE AUTHORIZATION OF THE EXECUTIVE SECRETARY
PRANTMENT OF STATE
2)
Department of State
TELEGRAM
STATE
OF
CONF IDENT IAL
PAGE 03 STATE 267049
-REDUCTION OF NON-TARIFF MEASURES BY NEGOTIATION OF
CODES;
--SIGNIFICANT IMPROVEMENT IN AGRICULTURAL TRADE; AND
-ELIMINATION OF TARIFFS IN GIVEN COMMODITY AREAS.
7. WE SHOULD ALSO REAFFIRM OUR OECD PLEDGE NOT TO TAKE
RESTRICTIVE ACTION.
8. ON MONETARY ISSUES, THE DIVERGENT POSITIONS OF A
YEAR AGO HAVE NARROWED CONSIDERABLY. THESE PAST WEEKS OUR
REPRESENTATIVE, TREASURY UNDER SECRETARY YEO, HAS BEEN
MAKING AN INTENSIVE EFFORT TO RESOLVE REMAINING DIFFER-
ENCES. IF THESE DISCUSSIONS SHOULD SUCCEED, CHANCES WILL
BE COOD or GETTING THE WHOLE NEW MONETARY STRUCTURE IN
PLACE BY THE JANUARY MEETING OF THE IMF. IN THIS AREA AS
IN OTHERS, I DO NOT THINK THAT WE SHOULD OURSELVES ATTEMPT
TO NEGOTIATE OUTSTANDING ISSUES AT THE SUMMIT. THE TIME
IS TOO SHORT THE ISSUES ARE OFTEN TECHNICAL: AND IT
WOULD BE WRONG TO DIVERT OUR EFFORTS FROM WHAT ONLY WE
CAN DO -- SET FUNDAMENTAL POLICY DIRECTIONS -- TO WHAT
MINISTERS CAN DO.
9. ON ENERGY, A FRANK DISCUSSION OF THE POSITION OF OUR
COUNTRIES AS WE EMERGE FROM THE RECESSION AND ENTER THE
ECONOMIC DIALOGUE WITH THE DEVELOPING COUNTRIES AND KEY
OPEC MEMBERS IS CLEARLY IN ORDER. OUR VIEW WILL BE THAT
THE IEA COUNTRIES MUST HOLD TO THEIR DECEMBER 1 DEADLINE
IN THE LONG-TERM PROGRAM, INCLUDING THE MINIMUM SAFE-
GUARD PRICE. WE ALSO OUGHT TO ALLOW FOR SOME WAY FOR
FRANCE TO ASSOCIATE INTO THAT PROGRAM ONCE IT IS COMPLETED.
WE WILL WANT "TO ADDRESS THE QUESTION OF ACCESS TO ENERGY
SUPPLY AND INVESTMENT WITHIN THE IEA. AND WE SHOULD TALK
ABOUT WHAT WE CAN AND CANNOT DO IN ENERGY IN THE DIALOGUE,
10. FINALLY, WITH THE DIALOGUE IMMINENT AND IN THE WAKE
OF THE SEVENTH SPECIAL SESSION OF THE UNITED NATIONS, IT
WOULD BE BOTH APPROPRIATE AND POLITIC PUBLICLY TO
NOT TO BE REPRODUCED WITHOUT CONF THE AUTHORIZATION OF THE EXECUTIVE SECRETARY
FORM no 1652
DEPARTMENT or STATE
Department of State
of I AMERICA
TELEGRAM
CONFIDENTIAL
PAGE 04 STATE 267049
ACKNOWLEDGE THE RELATIONSHIP OF OUR DELIBERATIONS TO THE
ASPIRATIONS OF THE DEVELOPING WORLD AND TO RESTATE OUR
COMMITMENT TO A TRANSFORMATION OF THE RELATIONS BETWEEN
THE INDUSTRIALIZED AND DEVELOPING WORLD.
:
11. AS I NOW SEE IT, IN ORDER FOR OUR MEETING TO HAVE
THE DESIRED RESULTS, WE SHOULD PREPARE AND ISSUE A JOINT
STATEMENT EMBODYING OUR CONCLUSIONS. WE ARE ALL FIRMLY
IN AGREEMENT THAT OUR MEETING SHOULD NOT CONCERN ITSELF
UNDULY WITH THE PREPARATION OF A TEXT. THAT TASK CAN BE
LARGELY CONFIDED TO THE OFFICIALS THAT WILL ACCOMPANY US.
12. TO PROVIDE YOU AND YOUR ASSOCIATES WITH A FURTHER
INDICATION -- AND SOME SPECIFICS -- OF WHAT WE BELIEVE WE
MIGHT SAY IN SUCH A JOINT STATEMENT, GEORGE SHULTZ, OUR
REPRESENTATIVE AT THE NOVEMBER 11 MEETING IN LONDON IS
PROPOSING A TEXT WHICH EMBODIES OUR THINKING ON THE ISSUES
TO BE ADDRESSED AND OUR SUGGESTIONS ON WHAT SHOULD BE SAID
PUBLICLY ABOUT THEM.
13. I AM SENDING SIMILAR LETTERS TO EACH OF THE LEADERS
WHO WILL JOIN US AT RAMBOUILLET. I LOOK FORWARD TO SEEING
YOU THERE. GERALD R. FORD INGERSOLL
EXP-01
NOT TO BE REPRODUCED WITHOU 1SHTE AUTHORIZ ATION OF THE EXECUTIVE SECRETARY
FORM
FORM
Handed rev to Umb
Von St, in 3/27 11:00
am
THE WHITE HOUSE
WASHINGTON
SECRET
March 25, 1976
Dear Mr. Chancellor:
I very much welcomed your letter of February 11, 1976
addressing defense issues of importance not only to the
Federal Republic and the United States but also to the
entire North Atlantic Alliance. You have raised some
very important questions, and I want to share with you
my views and stay in close contact with you in the weeks
preceding your visit.
On the relocation of a U.S. combat brigade to the
NORTHAG area, I was pleased to note that you do not
wish to delay preparations, and I wish to express my
personal support for the proposed relocation. At the
time the United States first suggested this relocation,
we also agreed to increase our commitment of Army
divisions to Europe by designating the NORTHAG bri-
gade as the advance element of a three-division U.S.
corps to be moved to Europe to reinforce NATO's
northern defenses in the event of hostilities. It is my
judgment that, taken together, these two initiatives
will represent a significant improvement in NATO's
military posture and offer fresh evidence of the firm
U.S. commitment to the defense of Europe.
I know that discussions are now underway between our
two governments concerning a successor arrangement
to the expired offset agreement, including the financial
aspects of the brigade's relocation. I would consider a
significant one-time contribution by the Federal German
Government to the restationing costs a major element in
SECRET
DECLASSIFIED
E.O. 12958, SEC. 3.5
NSC MEMO, 11/24/98, STATE DEPT. GUIDELINES state liview 9/16/03
BY
, NARA, DATE 3/5/04
SECRET
- 2 -
whatever arrangement can be worked out. Without such
a German contribution, it is difficult for me to see how
the U.S. could proceed with the movement of the new bri-
gade into northern Germany. Solving the problem of the
relocation costs in conjunction with the successor arrange-
ment would be of advantage to both of us in presenting our
common defense efforts to our respective publics in the
best possible light. I am therefore hopeful that an early
settlement of this particular problem can be reached.
You have raised a valid question about the defense efforts
of our other NATO Allies. I feel strongly that the intro-
duction of the U.S. brigade into the northern area must
not be interpreted by our other Allies as meaning that the
U.S. intends to take on responsibility with the Federal
Republic of Germany for the defense of the north in such
a way as to permit other Allies to reduce their contribu-
tions. I therefore propose that, as preparations for the
brigade's relocation become more concrete, our respective
representatives in NATO work out a joint approach to the
North Atlantic Council. We would direct our representa-
tives to state frankly that the brigade is designed to en-
hance the flexibility of our defenses in a critical area,
that we expect our other Allies to keep up their own
efforts in the northern area, and that all of the Allies
should take the occasion of the relocation to consider
ways in which their military presence in the area can
be made more effective in the interests of our common
defense. I believe that a firm exposition of our views
will encourage our Allies to keep up their commitments.
Indeed, I am increasingly concerned about the steady
increase in Soviet and Warsaw Pact military capabilities
at the very time of growing political uncertainties in the
West. We are studying whether this improvement should
be considered a new trend or simply the continuation of
an historic pattern. I have made a major effort with our
Congress this year to impress on them the vital necessity
SECRET
SECRET
- 3 -
of halting the erosion in our defense spending and adopting
a long term strategy to meet our strategic as well as con-
ventional force requirements. Without engaging in alarmism,
I think it especially important in the Alliance that we consider
how each of us individually, as well as collectively, intend to
proceed over the next several years in the face of Soviet
determination to maintain their own capabilities.
As far as I am concerned the U.S. and West Germany must
remain in the closest contact on all subjects of mutual
concern, including of course security issues. I hope we
can go more deeply into these areas during your visit this
July.
In this regard, I want to respond to your query about our
coordination on the use of American FRG-based troops
and equipment outside the NATO area. I cannot commit
the U.S. Government never to use part of its forces in
the FRG elsewhere in the world. The U.S. defense estab-
lishment is a unified one: there is not a separate force
structure for NATO and another one for the rest of the
world. The American public and Congress would simply
and rightly not support two defense establishments. I
am sure that you understand this point. But, having said
that, I wish to assure you that I will make every effort
to ensure that NATO and FRG interests are taken full
account of in any contemplation by the U.S. of possible
movements of U.S. troops or materiel out of the Federal
Republic.
I fully understand, of course, the sensitivity of this
particular issue for you and your Government. I will
instruct the Secretaries of State and Defense to work
out procedures for full and timely consultation with
their West German counterparts to cover instances
where substantial numbers of U.S. troops or amounts
of equipment are to be deployed outside the NATO area.
In cases of real emergency, where time is of the essence,
I will endeavor myself to be in touch with you directly.
SEGRET
SECRET
- 4 -
Let us, as close friends and Allies, continue to stay in
touch on these most sensitive matters. Only by full and
frank exchanges can we truly insure that we understand
each other. After all, our purposes in this area are
identical -- to preserve the security and viability of the
Western Alliance.
Sincerely yours,
Heald R. 7nd
His Excellency
Helmut Schmidt
Chancellor of the Federal
Republic of Germany
Bonn
SECRET
FORD LIBRARY
LIBRARY
ERALD
è
FORD
Handed to Hen Scowcroft by
amb won Stadem at 410 pm,
C.
Thurs, 2/18/76
EMBASSY
OF THE
FEDERAL REPUBLIC OF GERMANY
WASHINGTON, D.C.
February 18, 1976
My dear Mr. President,
The Chancellor of the Federal Republic of Germany
Helmut Schmidt has asked me to transmit to you
the following letter:
" Bundesrepublik Deutschland
- Geheim-
Der Bundeskanzler
Bonn, den 11. Februar 1976
Sehr geehrter Herr Präsident,
ich möchte zurückkommen auf unser Gespräch in Washington
am 3. Oktober 1975, in dem ich mich nach Ihrer Meinung er-
kundigte über die von Secretary Schlesinger verfolgten
Pläne für die Stationierung einer zusätzlichen US-Brigade
in der Bundesrepublik Deutschland. Am gleichen Tage hatte
ich ein Gespräch mit Schlesinger, das mir den Eindruck
vermittelte, als seien die diesbezüglichen Pläne inner-
halb der amerikanischen Regierung noch nicht voll abge-
stimmt.
Ich bin jetzt darüber informiert, dass Secretary Rumsfeld
die Pläne seines Vorgängers weiterverfolgt. Minister
Leber steht dem Vorhaben aufgeschlossen gegenüber. Die
finanziellen Aspekte sind bisher nicht geklärt, aber
darüber will ich jetzt nicht sprechen. Ich habe nicht die
Absicht, die vorbereitenden Arbeiten zu verzögern.
The President
The White House
Washington, D.C.
Secret
DECLASSIFIED
E.O. 12958, SEC. 3.5
NSC MEMO, 11/24/98, STATE DEPT. GUIDELINES state Review 9/16/03
BY ad
, NARA, DATE 3/5/04
Unabhlingig von der Stationierung der zusätzlichen US-Brigade
möchte ich zwei Fragen aufwerfen, über die ich mir seit
einiger Zeit Gedanken mache:
Wie können wir, dic USA und die Bundesrepublik Deutsch-
land, noch stärker als bisher darauf hinwirken, dass
unsere übrigen Bündnispartner, insbesondere die euro-
päischen, in ihren Verteidigungsanstrengungen nicht
weiter nachlassen und vor allem ihre konventionellen
Beiträge zur Abschreckung und zum Bündnis leisten?
Wie können wir uns noch besser als bisher abstimmen, wenn
die amerikanische Regierung beabsichtigt, in der Bundes-
republik Deutschland stationierte amerikanische Streit-
kräfte oder in der Bundesrepublik Deutschland gelagerte
amerikanische Ausrüstung für Einsätze ausserhalb des
NATO-Gebiets zu benutzen? Dabei geht es einmal um das
Problem, dass die Kampfkraft der NATO nicht geschwächt
werden darf, zum anderen darum, dass die aussenpoliti-
schen Interessen der Bundesrepublik Deutschland aus-
reichend berücksichtigt werden. Auch unsere Innnenpolitik
darf dabei nicht ganz ausser acht gelassen werden.
Ich fände es gut, wenn wir hierzu ein Konsultationsverfahren
entwickeln könnten.
Ich bin mir darüber im klaren, dass der zweite Punkt
einen sehr sensitiven Bereich betrifft, der sich für eine
Behandlung auf der Arbeitsebene kaum eignet.
Als Partner und Freund wäre ich Ihnen sehr dankbar, wenn
wir über diese Thematik in einen Meinungsaustausch ein-
treten könnten.
Mit freundlichen Grüssen
stets Ihr ergebener
Helmut Schmidt II
A courtesy translation reads as follows:
"Federal Republic of Germany
Bonn, 11 February 1976
The Federal Chancellor
-Secret-
Mr. President,
I should like to refer to our discussion in Washington
on 3 October 1975 when I asked your opinion on Secretary
FORD
R
GERALD
LIBRARY
S
Schlesinger's plans for the stationing of an additional US-
brigade in the Federal Republic of Germany. I met Mr.
Schlesinger on the same day and gained the impression that
the American Administration had not yet finally decided
the matter.
I have now been informed that Secretary Rumsfeld is pursuing
his predecessor's plans. Our Minister of Defense, Herr Leber,
is favourably disposed to them. The financial aspects have
not yet been clarified but I will not go into that just now.
It is not my intention to delay the preparations.
Irrespective of the stationing of the additional brigade,
there are two other questions which have been occupying my
thoughts for some time:
- how can we, the United States and the Federal Republic
of Germany, increase our efforts to ensure that our
partners in the alliance, ,in particular the Europeans,
do not relax their defence efforts any further, and above
all continue to render their conventional conributions
to deterrence and to the alliance?
- how can we improve our co-ordination whenever the United
States Administration intends to use American Forces
or equipment in the Federal Republic of Germany for
assignments outside the NATO area? Here it is a case
of not weakening the combat efficiency of NATO and of
giving adequate consideration to the foreign policy
interests of the Federal Republic of Germany. Nor must
our domestic situation be entirely disregarded.
I think it would be a good thing if we could develop
some kind of consultation procedure for this matter.
I realize that the second point touches a highly sensitive
area which is hardly suitable for discussion at working
level. As a partner and friend, therefore, I would greatly
appreciate it if we could enter into an exchange of views
on this subject.
Sincercly yours,
sgnd Helmut Schmidt"
FORD
&
Respectfully
MEMORANDUM
THE WHITE HOUSE
WASHINGTON
SECRET/XGDS
ACTION
March 25, 1976
MEMORANDUM FOR THE PRESIDENT
FROM:
Brent Scowcroft
B
SUBJECT:
Message from Chancellor Schmidt on NORTHAG
Brigade and Other Defense Issues
FRG Chancellor Helmut Schmidt has sent you the message at Tab B
reviewing three defense issues of current importance to him:
-- the relocation of a US brigade to northern Germany,
-- the need to ensure that NATO members other than the United States
and the Federal Republic do not relax their defense efforts, and
-- his hope, for both domestic and foreign policy reasons, that it will
be possible for you to develop an advance consultation procedure
with him should the United States plan to use U.S. forces or
equipment in Germany for assignments outside the NATO area.
Chancellor Schmidt's message comes at a time when, in addition to the
brigade relocation issue, we are still in the process of negotiating successor
arrangements to the Offset agreement with the FRG, when we are encouraging
the FRG to buy the Airborne Warning and Control System (AWACS) aircraft,
and when US and FRG tanks are about to enter into a stiff competition which
will be instrumental in the awarding of the multi-billion-dollar US tank
contract. Accordingly, I believe that Schmidt wants to ensure that he is
aware of your personal views on the relative importance of the brigade as
he sorts his several defense priorities. Of greater importance, Schmidt
is very sensitive to the political implications of an additional U.S. brigade
on German soil at a time when other members of the Alliance are looking
for ways to quietly cut back on their conventional strength.
Addressing still another of his defense concerns (going back to the 1973
FRG domestic problems when the U.S. resupplied Israel with U.S. equipment
from the FRG during the Yom Kippur war) Schmidt raises the issue of con-
sultations. The prospect of the NORTHAG brigade renews his worries that
the United States might at some point in the future draw on this manpoweroll
DECLASSIFIED
SECRET/XGDS
E.O. 12958, SEC. 3.5
NSC MEMO, 11/24/98, STATE DEPT. GUIDELINES state Review 9/16/03
GERALD
BY
4
, NARA, DATE 3/5/104
SECRET/XGDS
- 2 -
and equipment for an out-of-theater mission. Accordingly, to enable him
to deal as effectively as possible with his domestic and international situation
should this need arise, he would like your assurances that you will consult
in advance. Each of these issues is reviewed in greater detail below.
NORTHAG Brigade
For the past several months we have been exploring with the FRG the
desirability and practicality of relocating to the Northern Army Group
(NORTHAG) area of NATO one of the two new Army brigades resulting
from the Nunn Amendment. Former Secretary Schlesinger proposed this
to FRG Defense Minister Leber last September; Secretary Rumsfeld
continued the discussions with Leber last December. General Haig
strongly supports the proposal, part of a larger plan under which the
United States would increase our overall commitment of divisions to
Europe by designating the NORTHAG brigade as the advance element
of a three-division U.S. corps to be moved to Europe to reinforce NATO's
northern defenses in the event of hostilities.
The principal impediment to early relocation of the brigade has been that
of obtaining a guarantee that the FRG would defray the initial construction
and rehabilitation costs involved in relocation. We have been discussing
NORTHAG in the context of US-FRG talks on a successor arrangementto
Offset, suggesting that the NORTHAG costs be counted as part of the FRG
offset expenditure. There would seem to be the possibility that Schmidt
has concluded incorrectly that NORTHAG -- with the FRG offsetting
funding -- is not high on the list of U.S. priorities. The proposed response
to the Chancellor at Tab A informs him that the NORTHAG relocation
proposal has your personal support and it encourages him to proceed
with the offsetting relocation funding.
NATO Conventional Force Levels
Responding to the Chancellor's question on how the United States and the
FRG can work to ensure that conventional force levels are maintained by
the other members of the Alliance, your message would state your complete
agreement that U.S. and FRG efforts should not be a substitute for
responsible action by the rest of the Alliance. Your response advises
that the United States will continue to take a strong stand on the need for
adequate conventional force levels.
Consultations on Out-of-Theater Use of U.S. Forces
In response to what is, perhaps, Chancellor Schmidt's greatest concern,
your reply would express understanding with the considerations which have
SECRET/XGDS
SECRET/XGDS
- 3 -
caused him to propose direct, advance consultations relating to
the possibility that U.S. troops and equipment in the FRG might
be required to be used outside the NATO area. Your reply explains
the need for relying at times for NATO assigned troops for out-of-
NATO contingencies and proposes the working out of procedures
for full and timely consultation.
Secretaries Kissinger and Rumsfeld concur in the proposed letter.
Bob Hartmann's office has approved the draft.
RECOMMENDATION
That you sign the letter to Chancellor Schmidt at Tab A.
SECRET / XGDS
FORD LIBRAR & 07
760319
THE WHITE HOUSE
"f
WASHINGTON
Peter - ?
Kathy - >
GERALD & LIBRARY FORD
WORKING COPY
1. This draft letter is a real disappointment. In the first place
because it completely overlooks the big picture and Schmidt's key role in
the big picture, and in the second place because the letter is actually off
base on a couple of small but important technical points.
2. Technically, there should be
reference to the Chancellor's
forthcoming visit to Washington (scheduled for late July). This reference
should include the proposition that the two men will at that time have an
opportunity to explore in detail some of the wider implications of the
specific matters raised in the Chancellor's letter.
3. And, still on the technical level, the proposed treatment of the
Chancellor's concern about the defense efforts of our other NATO allies is
so narrowly linked to the effects of the NORTHAG brigade as to be seriously
deficient in a
diplomatic sense.
This whole section of the President's letter should be placed un-
ambiguously with the discussion of the NORTHAG brigade and a whole new
section drafted which would address the serious issue of Western Europe's
defense manpower and real budget spending trends (in comparison with
Soviet or Warsaw Pact trends).
4. In effect, Schmidt is telling us the West Europeans are gradually
giving in to unilateral disarmament, parliamentary democracy is gradually
losing its capability to cope with its own social and economic problems,
West Germany seems to be a working exception to these trends, and the West
Germans would be ready to work more closely with us against adverse trends
-- assuming we are interested or concerned.
FORD
&
DECLASSIFIED
E.O. 12958, SEC. 3.5
leview
9/16/03
STATE DEPT, GUIDELINES
state
WORKING
COPY]
GERREO
BY
NARA DATE 3/5/04
But, he is telling us in his letter of February 18, we should work
together more as allies and less as mercenary military guarantor and syco-
phantic dependent.
5. The Presidential reply doesn't need to go into all these matters,
but should convey a tone of alertness to the larger problems, of appre-
ciation for the understanding displayed in the Schmidt letter, and of
2
readiness to explore a changing distribution of responsibilities within
the overall context of European-American relationships and directions.
WORKING COPY]
WORKING
The letter raises three concrete problems, in the form of specific questions.
But these matters arise, and can only be dealt with, in the context of several
deeper and murkier problems.
The West Germans are very much beginning to feel (to an extent they have
not felt since World War II) the pulls and tugs of the main currents of
modern history. What is their role, their destiny, in Europe? Knowing
they are deeply and integrally "of" the West, don't they still have both
role and destiny to the East? Russia, primarily; but what of their brothers
and cousins in the GDR?
And in the West: what shall be Germany's part from now on? Britain is down.
France's currency is terribly weak, and France's communists are strong.
Then there is Italy, and there is Spain. As for Germany: her gold and
foreign exchange reserves are nearly three times those of the United States,
and her society is coherent and ready for movement, if not presently imbued
with a sense of purpose. The Federal Republic is not prepared to go on
being "an economic giant and a political dwarf." She is fully ready, if
not fully determined yet, to play a larger and more decisive role in the
Western European Community.
And what of America? The American connection is key but what does it mean?
Does it just mean a military guarantee (and presence) which is to continue
to be mercenarized, bought and paid for?
These are the deeper and murkier matters from which spring Schmidt's more
concrete and specific questions.
Somewhat off to one side, but still in the picture, is the related question
of the role of Helmut Schmidt himself. He is clearly a man of unusual per-
ception and ability. I think his instincts and attitudes are constructive,
but he is also a politician with an immediate political problem. That is
to say, he has mastered his left wing in preparation for this autumn's
elections, and probably has mastered his domestic economy too, but he has
not mastered his coalition partner. Schmidt is strong in the SPD, and in
the country; he himself is stronger than his party; the CDU/CSU is gaining
strength in the country (i.e., in Land elections) but it's leader, Kohl, is
weak; the SPD under Schmidt will probably beat the CDU/CSU under Kohl this
fall. But it is not at all clear whether the FDP will stay with the SPD
as a governing coalition, or will switch to the CDU/CSU.
If Washington makes Schmidt look good over the summer, that would help
Schmidt, but probably not decisively. On the other hand, if we don't find
ways to make him look good, that in itself makes him look bad and could
hurt him decisively.
DECLASSIFIED
E.O. 12958, SEC. 3.5
STATE DEPT, GUIDELINES, state 9/16/03
BY
NARA. DATE 3/5/04
DERALO
WORKING PAPERS
I would hope that the reply to his letter would take all these factors fully
into account. It is my judgment that the long term interests of our own
nation should be the determining considerations in composing a response
to Schmidt's letter. The collateral effects on the domestic West German
political situation should be considered as strictly secondary.
1
The bottom line is that I think a preliminary reply to the Schmidt letter
should have a relatively favorable tone, and that concrete ideas should
be ready for discussion between the President and the Chancellor when the
Chancellor comes here later in the spring.
WORKING PAPERS
TOP SECRET
(attached)
THE WHITE HOUSE
WASHINGTON
March 20, 1976
MEMORANDUM FOR ADMIRAL HOLCOMBL
FROM:
BILL HYLAND went
Attached is a draft Presidential reply to the letter of February 18,
from Chancellor Schmidt. Would you please obtain Secretary
Rumsfeld's comments and concurrence? We wish to send it to
the President as soon as possible (by Monday COB). It has been
agreed to by Secretary Kissinger
DECLARGIFIED
E.O. 12958, SEC. 3.5
SECDEF and oth,
NSC MEMO, 11/24/98, STATE DEPT. GUIDELINES
BY. lob
, NARA, DATE 3/5/04
may
has will prepare
Bab a copy Staver Il
TOP SECRET
(attached)
TOP SEGRET/SENSITIVE
SUGGESTED REPLY
Dear Mr. Chancellor:
Let me thank you for your thoughtful letter of February 11 concerning
certain questions related to US troops in Europe. I welcome the opportunity
to exchange views on these sensitive subjects and hope that we can continue
to keep in direct contact on them.
The stationing of a US combat brigade in northern Germany is, I
know, one of great interest to your government, as it is to mine. Our
respective defense authorities have been discussing aspects of the re-
location for some months. Our aim in proposing the move of this brigade
into the northern plain is to bolster NATO defensive forces in an area where,
as Western defense experts have long agreed, the topography offers a ready-
made invasion route to an aggressor. At the time the United States
first suggested this relocation, we also agreed to increase our commit-
ment of Army divisions to Europe by designating the NORTHAG brigade
as the advance element of a three-division U.S. corps to be moved to
Europe to reinforce NATO's northern defense in the event of hostilities.
It is my judgment that, taken together, these two initiatives will
represent a significant improvement in NATO's military posture
and offer fresh evidence of the firm U.S. commitment to the defense
of Europe
DECLASSIFIED
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NSC MEMO, 11/24/98, STATE DEPT. GUIDELINES state Deview 9/16/03
E.O. 12958, SEC. 3.5
BY
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I know that discussions are now underway between
our two governments concerning a successor arrangement
to the expired offset agreement, including the financial
aspects of the brigade's relocation. I would consider a
significant one-time contribution by the Federal German
Government to the restationing costs a major element in
whatever arrangement can be worked out. Without such a
German contribution, it is difficult for me to see how
the US could proceed with the movement of the new brigade
into northern Germany. Solving the problem of the
relocation costs in conjunction with the successor
arrangement would be of advantage to both of us in pre-
senting our common defense efforts to our respective
publics in the best possible light. I am therefore
hopeful that an early settlement of this particular
problem can be reached.
You have raised a valid question about the defense
efforts of our other NATO Allies. I feel strongly that
the introduction of the US brigade into the northern
area must not be interpreted by our other Allies as
meaning that the US intends to take on responsibility
with the Federal Republic of Germany for the defense of
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the north, in such a way as to permit other Allies to
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reduce their contributions. I therefore propose that,
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as preparations for the brigade's relocation become more
concrete, our respective representatives in NATO work out
a joint approach to the North Atlantic Council. We would
direct our representatives to state frankly that the
brigade is designed to enhance the flexibility of our
defenses in a critical area, that we expect our other
Allies to keep up their own efforts in the northern area,
and that all of the Allies should take the occasion of
the relocation to consider ways in which their military
presence in the area can be made more effective in the
interests of our common defense. I believe that a firm
exposition of our views will help our Allies keep up
their commitment.
Let me respond to your query about our coordination
on the use of American FRG-based troops and equipment
outside the NATO area. I cannot commit the US Government
never to use part of its forces in the FRG elsewhere in
the world. The US defense establishment is a unified
one: there is not a separate force structure for NATO
and another one for the rest of the world. The American
public and congress would simply and rightly not support
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two defense establishments. I am sure that you understand
this point. But, having said that, I wish to assure you
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that I will make every effort to ensure that NATO and FRG
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interests are taken full account of in any contemplation
by the US of possible movements of US troops or materiel
out of the Federal Republic.
I fully understand, of course, the sensitivity of
this particular issue for you and your Government. I
will instruct the Secretaries of State and Defense to
work out procedures for full and timely consultation
with their West German counterparts to cover instances
where substantial numbers of US troops or amounts of
equipment are to be deployed outside the NATO area. In
cases of real emergency, where time is of the essence,
I will endeavor myself to be in touch with you directly.
Let us, as close friends and allies, continue to
stay in touch on these most sensitive matters. Only
by full and frank exchanges can we avoid misunderstand-
ings. After all, our purposes in this area are identical--
to preserve the security and viability of the Western
Alliance.
Sincerely yours,
Gerald Ford
His Excellency
Helmut Schmidt,
GERRAN
LIDRARY
Chancellor of the Federal Republic
of Germany,
Bonn.