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Nuclear Policy Review: September 3-6, 1976
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Nuclear Policy Review: September 3-6, 1976
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Issue Decision Papers for the President
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The original documents are located in Box 5, folder "Nuclear Policy Review: September 3-
6, 1976" of the White House Special Files Unit Files 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States of America his copyrights in all of his unpublished writings in National Archives collections.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.
Trudy, per our telecon, here are the
Agency recommendations for inclusion in the Pres
report.
Thanks.
I
Lore tta
43723
9/10 checked with Hlenn
he has capies of all of
this x
SoL
FORU
Digitized from Box 5 of the White House Special Files Unit Files at the Gerald R. Ford Presidential Library
CONFIDENTIAL
4973
UNITED STATES ARMS CONTROL AND DISARMAMENT AGENCY
WASHINGTON
September 3, 1976
OFFICE OF
THE DIRECTOR
MEMORANDUM TO THE PRESIDENT
SUBJECT: ACDA Position on Nuclear Policy Review
I strongly recommend the domestic and international
Option 2:
-- defer and discourage reprocessing;
-- provide for storage of spent fuel; and
-- vigorously pursue alternative technologies
for recovering the energy value in such
fuel without separating the plutonium.
You are well aware of the intense public and
Congressional concern over reprocessing. A major
thrust of your Administration's nonproliferation
efforts has been to head off reprocessing in countries
such as Korea, Pakistan, Israel, Egypt and the Republic
of China.
This is because reprocessing reduces plutonium
to a form highly vulnerable to theft or seizure and
quickly usable in nuclear explosives, as we saw in
India. The output of one commercial size reprocessing
plant would furnish enough nuclear explosive material
for several thousand atomic bombs per year. There
is no reliable way to prevent plutonium from being
captured by a government willing to violate its
safeguards agreements, and then being converted into
nuclear weapons in a time shorter than we could
probably react.
In these circumstances, a decision now to assist
and accelerate reprocessing in the United States by
DECLASGIFIED
E.O. 12958 Se
CONFIDENTIAL
MR 98-16,*11; ALDA letter 1/20/98
By let NARA, Date 4/13/98.
CONFIDENTIAL
-2-
a $1/2 billion Federal investment to permit operation
of a reprocessing plant constructed by Allied Chemical,
Gulf, and Royal Dutch Shell, could have obvious domestic
political repercussions. This would be especially true
since the current public proceedings by the Nuclear
Regulatory Commission on whether or not to permit the
use of reprocessed plutonium in US reactors will not
be concluded for at least another year.
More importantly, such a decision would seriously
undercut our efforts to head off reprocessing in other
countries, who look more to what we do than what we say.
The option I am recommending would avoid this risk and
directly support our international efforts, including
our call on the London Suppliers' Group to examine
alternatives to national reprocessing.
Such alternative technologies exist, but require
further development and demonstration. While we are
working on them, we can well afford to postpone the
recovery of the potential energy value in spent reactor
fuel. The report makes it clear that the economic
benefits to reprocessing -- if any -- are small and
uncertain. There is no question that we have sufficient
uranium to fuel all US reactors likely to be built in
the next 15-20 years. By providing spent fuel storage
facilities (which are considerably less costly than
reprocessing facilities) we would both be setting an
example for other countries and relieving our own
utilities of their most immediate problem -- the need
to remove the accumulated spent fuel from their reactor
sites.
You, Mr. President, should be the first to establish
the principle of proliferation safety -- that commercial
technologies can and must avoid access to weapons-usable
material. You can direct our superior technological
capabilities to this end and remove a major security
risk from the nuclear energy picture. And, with the
force of a powerful American example, you can lead the
world in the same direction.
Comments on other issues are attached.
Fed C. The
Fred C. Ikle
COMPIDENTIAL
CONFIDENTIAL
ATTACHMENT
ACDA Position on Other Issues and Recommendations
in Nuclear Policy Review
In keeping with our recommendations about reprocessing,
we attach very high priority to the recommendation that you
support, through approaches at the highest level of other
supplier governments, our efforts to secure a two-year mora-
torium by such suppliers on transfers of sensitive technology.
The other central issue in the Review is how we should
tighten our nuclear export controls, which is also the prin-
cipal subject of the legislative proposals in this field
currently being discussed with Congress. We consider the
restraints proposed on page 13 of the Review as desirable,
except that we oppose any formulation that would accelerate
reprocessing or provide reprocessing services involving the
return of separated plutonium or mixed oxide fuel to third
countries, since these products are too readily convertible
to use in nuclear weapons. We endorse the recommendations
on sanctions, and generally prefer the "strong initiative on
retroactivity" described at pages 17-18 to unilateral insist-
ence on retroactivity, but believe judicious use of licensing
leverage can also further our objectives.
With respect to the incentives discussed at page 22, we
disagree with the recommendations which would encourage co-
operation in establishing early additional reprocessing
facilities in Europe or Japan.
We are in general accord with the recommendations on
Material Storage (although the stress should be on spent fuel
storage, and you might wish to study further the wisdom and
scope of the suggested U.S. voluntary offer), Safeguards and
Physical Security, Sanctions, Waste Management, Other Initia-
tives, and Next Steps. With respect to the organizational
recommendation on organization of Executive Branch supervision
of nuclear policy matters, we recognize that other arrange-
ments would also be workable, SO long as they gave an appro-
priate voice to this Agency on matters affecting our non-
proliferation efforts. We believe the question of whether
the UN General Assembly would be a good forum for announcing
your international decisions would be highly dependent upon
DECLASSIFIED
CONFIDENTRAL
E.O. 12958 Sec. 3.6
Alst ALOA letter 1/20/98
By ut NARA, Date 4/13/98
CONFIDENTIAL
- 2 -
the nature of your decisions and the extent to which they
may appear coercive and discriminatory rather than cooperative
and self-restraining.
Finally, while the report rightly focusses on the partic-
ularly pressing problems of reprocessing and plutonium,
nuclear weapons can also be made with highly enriched uranium.
Since most power reactors use only slightly enriched uranium
(2-3%), the related nonproliferation problem is primarily one
of controlling the spread of enrichment facilities and tech-
nology (which could also produce highly enriched uranium),
and of meeting foreign fuel needs through enrichment services,
involving low enrichment. For this purpose, we well as for
providing fresh fuel as an alternative to reprocessing and
avoiding waste of our uranium resources, the prompt expansion
of uranium enrichment capacity in the United States is indis-
pensable, and we endorse the recommendations on this subject
on page 23. We also recommend a separate review of our policy
on the export of highly enriched uranium itself, and intensified
diplomatic efforts to prevent the spread of enrichment technology.
We have not commented on the annex to the report, which we
have not seen in the final form.
CONFIDENTIAL
THE SECRETARY OF STATE
WASHINGTON
CONFIDENTIAL
September 6, 1976
EXDIS
MEMORANDUM FOR: THE PRESIDENT
From:
Henry A. Kissinger
F
Subject:
Nuclear Policy Review and
Non-Proliferation Initiatives
I wish to take this opportunity not only to
transmit my Department's response to the nuclear
policy report, but also to offer my personal
recommendations on the international aspects of
your policy choices, their public presentation,
and their diplomatic implementation. The State
Department has participated actively in the
formulation of the foreign policy elements of this
study. I strongly concur in the review group's
emphasis on the international basis for your
nuclear policy, and I believe it of central impor-
tance both that we maintain consistency between
their expression and execution and that we ensure
broad multilateral support for the positions you
take.
Attached are the specific State Department
positions, which I fully endorse, on the proposals
and options prepared by your interagency group.
I concur in the report's recommendations for
effective diplomatic consultations and action, in
which we played an active role in developing and
which we are prepared to undertake as soon as you
give your approval. I need hardly emphasize that
the more advance notice of proposed policies and
statements we give our nuclear partners and allies,
the more likely they will be to provide the support
so necessary for the success of our non-proliferation
policies. Therefore, this memorandum specifically
seeks your early authorization for proposed diplomatic
approaches, on the basis of which you could refine
DECLASSIFIED
E.O. 12958 Sec. 3.8
CONFIDENTIAL
MR 98-17, State Hr.2/11/99
By KBH NARA, Date 7/7/00
CONFIDENTIAL
- 2 -
the international policy elements of your eventual
public statement.
Non-Proliferation Objectives
In reviewing and developing further our nuclear
policies, it is essential for the US to:
1. Ensure that our non-proliferation policies
are cast in the framework of our overall foreign
policy interests and close relationships with nuclear
partners and allies.
2. Retain multilateral support for our non-
proliferation policies, without which our political
relationships will be set back and our non-proliferation
efforts will be rendered ineffective.
3. Develop a policy which marries the restraints
which we require with the incentives we can offer.
4. Prevent our non-proliferation efforts from
being distorted by international commercial competition.
5. Make domestic decisions which will effectively
support, rather than undercut, the primary objective
of deterring nuclear proliferation.
Meeting Policy Objectives
This Administration can justly claim credit for
the concerted and productive US efforts to develop
strengthened and uniform nuclear safeguards and
controls, through bilateral discussions with such key
suppliers and consumers as France and Iran and multi-
lateral consultations in the London meetings of major
nuclear suppliers. The US has achieved significant
non-proliferation results through high-level,
confidential diplomacy, consistent with our broad
foreign policy interests and relationships. At the
same time, we have openly advocated strengthened
nuclear safeguards and controls, in public statements
and testimony to the Congress. But domestic pressures
have substantially increased for fuller public
expressions of what we have pursued privately and for
visible improvement and strengthening of our policies.
CONFIDENTIAL
CONFIDENTIAL
- 3 -
It therefore continues to be necessary to make
choices as to what balance is to be struck between
diplomatic imperatives and public perceptions of a
vigorous, coherent nuclear policy. We should make
no apologies for past performance, but we should
also not hesitate to stake out new territory.
The fundamental need to meet the non-proliferation
objectives set our above leads, in my view, to the
following policy choices and presentational require-
ments which are consistent with but often carry further
the group's recommendations:
1. New conditions of nuclear supply, however
desirable, should not be imposed by the US unilaterally,
but rather pursued and adopted multilaterally. I must
stress that a unilateral approach will damage us
politically, with our allies and partners, and will lead
the US to lose both commercially and in non-proliferation
terms, as other less committed nations pre-empt the
nuclear market. It should be recognized that if the
suppliers, many of whom are also our allies, do not wish
to follow a US initiative voluntarily, then we will
either have to coerce them or jeopardize our non-
proliferation policy. Clearly, we should not select a
strategy which could so easily trap us in such a dilemma.
At the same time, we should continue to make best
diplomatic efforts to make non-proliferation gains, as
I believe we have in our proposed nuclear agreements
with Egypt and Israel and in our current negotiations
with Iran. I believe that a strong public statement
could be built around the crucial importance of multi-
lateral consensus in nuclear safeguards and controls,
the need for this country not to isolate itself and
lose its non-proliferation influence, and your
determination to pursue a responsible nuclear export
policy while obtaining strong international support for
our non-proliferation efforts.
2. It is essential to offer non-proliferation
inducements in the areas of fuel buy-back and exchange,
working in concert with other suppliers. Nuclear
consumers, particularly those of proliferation concern
who already enjoy less constrained agreements, will
not voluntarily accept new restraints unless it is
CONFIDENTIAL
INFIDENTIAL
- 4 -
demonstrably in their interest to do so. I therefore
strongly endorse the review group's recommendations
for assured and equitable front-end fuel services in
exchange for spent fuel, which is at the heart of our
current negotiating approach with Iran.
3. Nuclear consumers will become less disposed
to relying on the US if we arbitrarily impose more
stringent conditions on nuclear agreements after their
terms have been mutually agreed. We must therefore
ensure that the NRC licensing procedures are responsive
to national policy as executed by the President, within
legislative requirements. Nuclear export licenses
should not be used as a lever for obtaining new
constraints from countries which live up to their
obligations to us. NRC procedures should be perceived
instead as a means of predictably implementing our
policies of providing inducements, such as guaranteed
reactor fuel supply, for countries accepting effective
non-proliferation constraints.
4. We should move to engage other major nuclear
suppliers in intensified and multilateral efforts to
ensure that uranium enrichment and reprocessing
facilities are located in supplier nations. To achieve
this, it is necessary to prevent commercial competition
from leading to proliferation of such sensitive nuclear
facilities. While I support the review group's
important recommendations for joint supplier fuel-service
support for reactor sales, I recommend that you set a
long-term framework for effective supplier coordination
of fuel assurances, by calling for an examination by
interested nations of an "international nuclear fuel
bank" concept, as described in the second section of
my Department's position paper, which would combine fuel
storage and supply arrangements under international
guarantees. With your approval, I will ask my deputies
to work with Bob Fri in integrating this new element
into your nuclear policy statement.
5. In this essential multilateral context, I
conclude that a limited domestic reprocessing decision
would serve our non-proliferation and foreign policy
objectives. In so doing, however, it would be desir-
able to provide for appropriate foreign participation
and essential to identify the proposed program as an
CONFIDENTIAL
CONFIDENTIAL
- 5 -
"experiment," without prejudging its outcome. I can
support the demonstration project associated with the
"assist reprocessing option" presented by the review
group, subject to what I believe are necessary
presentational and policy precautions elaborated in
the attached position paper, designed to reinforce
our overriding non-proliferation interests.
6. I agree that you should seize the opportunity
to press for rapid Congressional approval of the
Nuclear Fuel Assurances Act, as a crucial means for
expanding US enriched uranium capacity needed to
provide credible non-proliferation inducements. In
addition to providing greater US enriched uranium
capacity to meet foreign needs in the near-term, we
should redouble our efforts to develop more efficient
and controllable forms of enrichment technology which
could very substantially reduce the cost of enriched
uranium and expand available supplies. This would
permit us to shape an international system which could
offer a combination of the "carrot and stick" required
to bring about a regime which might dramatically slow
the spread of national reprocessing in non-supplier
states.
7. Nuclear policy message and management. Your
review group has suggested the UNGA as a possible forum
for your nuclear policy statement. I believe that the
UNGA would be an inappropriate forum for you to discuss
our new non-proliferation policies which will inevitably
convey a tougher approach toward constraints. Even if
tempered by offers of inducements, such a message would
likely be viewed by the majority of your audience as
restrictive, discriminatory, and targetted against the
countries they represent. Nevertheless, if you choose
to address the General Assembly on this subject, I
would urge that you focus on the cooperative elements
of these policies, such as the recommended international
spent fuel and plutonium regime and our interest in
exploring an international nuclear fuel bank concept.
I believe that, in any event, you should reserve for a
receptive US audience (or in a message to the Congress)
the stronger aspects of our policies, as well as any
decision to proceed with domestic reprocessing. As a
subsidiary consideration, I am not convinced that a new
bureaucratic layer -- the proposed Nuclear Policy Council
-- will enhance management effectiveness. You
CONF IDENTIAL
CONFIDENTIAL
- 6 -
might consider using instead existing interagency
committees, such as the specially constituted Under
Secretaries Committee described in the attachment,
to coordinate US nuclear policies.
Proposed Diplomatic Approaches
Your review group has identified the important
need for diplomatic consultations prior to, and
actions following, your nuclear policy statements.
I believe that your statement will afford a signifi-
cant opportunity to catalyze multilateral support
for the safeguards, physical security, restraints,
incentives and sanctions components of our nuclear
policies. Pursuant to the review group's recom-
mendations for next steps, I propose that you
authorize:
1. Rapid, advance consultations with the IAEA
and my counterparts in Canada, France, the FRG, Japan,
UK and USSR on the broad nuclear policy initiatives
you desire to announce; and incorporation into your
nuclear policy message of the results of these advance
consultations by the NSC and the Department, working
with the Domestic Council.
2. Exploration of your new nuclear policy
proposals (including, if you approve, our recommendations
for fuel pooling and an international nuclear fuel
bank concept) with other supplier and consumer states,
prior to my development of the comprehensive negotiating
plan suggested by your review group.
3. Active pursuit of our standing proposals for
an export moratorium on reprocessing facilities and
technology, use of supplier-based reprocessing services,
and international plutonium management, in the framework
of the London nuclear suppliers' meetings, consistent
with your nuclear policy decisions.
4. Accelerated interagency review of technological,
economic and commercial alternatives for maximizing
use of enriched uranium incentives, under effective
controls, to support policies of greater non-proliferation
restraint.
CONFIDENTIAL
CONFIDENTIAL
- 7 -
Recommendations:
1. That you authorize the diplomatic approaches
and follow-on actions proposed above.
Approve
Disapprove
2. That you direct incorporation in the Presidential
message of the international nuclear policy elements I
have described above, consistent with your decisions on
the recommendations of the nuclear policy review group.
Approve
Disapprove
Attachment:
State Department Positions on Nuclear Policy Report
CONFIDENTIAL
CONFIDENTIAL
STATE DEPARTMENT POSITIONS ON
NUCLEAR POLICY REPORT TO THE PRESIDENT
1. Non-Proliferation Restraints. The Department
generally supports a firmer policy on restraints in US
nuclear cooperation which stresses cooperation with NPT
parties or countries accepting full safeguards and with
countries prepared to forego or restructure their re-
processing options. We also support an approach which
makes a clear distinction between (1) cooperation under
new and amended agreements and (2) cooperation under
existing agreements. For both categories of recipients,
we would underscore the general need for a multilateral
approach. US leadership in non-proliferation is important
and consistent with our past policies and recent
initiatives in forming the London Suppliers' Group. But
excessively stringent or rigid unilateral US policies
will at best have limited benefits, since we no longer
dominate the international nuclear market and will not be
able to obtain new restraints without concerted supplier
actions.
On the more specific restraint recommendations:
-- For negotiating new or amended US nuclear co-
operation agreements, we strongly support the recom-
mendation that the US apply these restraints as non-
binding criteria for engaging in new or expanded nuclear
cooperation. We should recognize, however, the importance
of gaining common supplier policies on these restraints,
and be prepared to state that we will apply them as
conditions as soon as other suppliers agree to do the
same. The President's public statement would make this
basic approach explicit. We support the Review Group's
conclusion that new restraints should not be mandatory
requirements in the absence of multilateral agreement.
(In this connection, the options on "retroactive
sanctions" must be seen as possible elements of a
legislative strategy that must be accomplished in co-
ordination with the Congress.) Even with a Presidential
override, such a unilateral policy could impair our
flexibility in pursuing non-proliferation objectives
with specific suppliers and recipients.
-- For cooperation under existing agreements, we
strongly endorse the proposal to use diplomacy and a
strategy of inducements to persuade the many key target
DECLASSIFIED
CONFIDENTIAL
E.O. 12958 Sec. 3.6
MR 98-17, #14 State Hr. 2/11/99
By KBH NARA, Date 7/7/00
CONF IDENTIAL
- 2 -
countries in this category to voluntarily renegotiate
existing agreements with new restraints. In addition,
in connection with our attempts to f:.nd an acceptable
compromise with the JCAE on its Nuclear Export Bill, we
see merit in the recommendation that NRC use the agreed
London Supplier Guidelines as criteria in granting
export licenses under existing agreements. But even
with the proposed Presidential overrade, we are concerned
that such an approach could be viewed as an attempt by
the US to impose these guidelines retroactively, to the
detriment of our relations with a number of major allies
and our overall credibility as a supplier. Finally, we
oppose the imposition of new restraints as a condition
of further US supply until common supplier agreement is
achieved on this point. Even then, such a course of
action would contravene the legal terms of our inter-
national agreements, thereby risking adverse legal, foreign
policy, and even non-proliferation consequences.
As a fundamental point for recipients in both
categories, we would emphasize the vital link between
gaining new restraints and offering attractive inducements
through fuel buy-back and exchange, and possible leasing.
All such inducements should be coordinated with other
suppliers, since uncoordinated inducements may look to
other suppliers as a US attempt to preempt a larger share
of nuclear fuel and realted reactor markets. In parti-
cular, the more attractive and reliable we make our en-
riched uranium supply using existing and planned facilities
within the broad framework of the Nuclear Fuel Assurances.
Act, the more success we will have in obtaining effective
restraints on reprocessing. The President's public state-
ment should relate inducements to restraints to the degree
of specificity judged feasible in light of our ability to
consider offering new fuel supply or service arrangements.
These issues are discussed further below in the context of
our recommendations regarding alternatives to national
reprocessing.
In general, nuclear consumers will become less disposed
to relying on the US if we arbitrarily impose more stringent
conditions on nuclear agreements after their terms have
been mutually agreed. We must therefore ensure that the
NRC licensing procedures are responsive to national policy
as executed by the President, within legislative require-
ments. Nuclear export licenses should not be used as a
lever for obtaining new constraints from countries which
CONFIDENTIAL
CONFIDENTIAL
- 3 -
live up to their obligations to us. NRC procedures
should be perceived instead as a means of predictably
implementing our policies of providing inducements,
such as guaranteed reactor fuel supply, for countries
accepting effective non-proliferation constraints.
2. Alternatives to National Reprocessing. The
Department supports the first option, "contain the
spread of national reprocessing." We share the Review
Group's recognition of the need for strong and specific
US initiatives to achieve an international fuel-exchange
regime based upon:
-- inducements for recipients, in the form of
assured and equitable front-end fuel services in exchange
for their spent fuel; and
-- inducements for suppliers, in the form of joint
fuel-service support for reactor sales in non-nuclear
weapon states, in exchange for withholding sensitive
nuclear technology from further spread under national
control.
The Department supports the steps recommended to
further these objectives. However, we further recommend
that the President call for the exploration by interested
nations of an "international nuclear fuel bank" concept,
through which the potential benefits of plutonium recycle
would be shared under international controls, while the
reprocessing activities incidental to achieving those
benefits would be confined, initially to a few major
supplier countries, but eventually include a few carefully
sited multinational plants. The Department has developed
further proposals for making significant forward movement
in establishing an effective fuel exchange regime. These
proposals are consistent with but go further than the
review group's recommendations in relating restraint re-
quirements to fuel inducements. With the President's
approval, the following approaches would be integrated into
the fuel-exchange elements already presented in the nuclear
policy report:
-- As a matter of national policy, the President
would express:
CONFIDENTIAL
CONF IDENTIAL
- 4 -
(i) For recipients accepting our tightest non-
proliferation restraints, notably no national reprocessing
and enrichment facilities, US willingress to acquire some
or all spent fuel of US origin, at the customer's option,
in exchange for fresh enriched uranium under attractive
terms (i.e., guaranteed feed and enrichemnt services).
(ii) For recipients who do not agree to renounce
national reprocessing and enrichment facilities but are
not constructing such facilities now and are prepared to
place all spent fuel under international storage, future
enrichment guarantees at market rates but repurchase of
spent fuel only at US option.
(iii) For recipients unwilling to accept our
restraints in new or amended agreements, including
storage under international auspices, US insistence on
a purchase or exchange option for US supplied or derived
spent fuel. All suppliers would be urged to offer such
options.
-- To lend multilateral impetus to the foregoing
arrangements, the President would express publicly US
readiness to explore with interested supplier nations
possible arrangements for pooling fuel-exchange capa-
bilities through such means as tie-in fuel sales, cross-
investment in enrichment and reprocessing facilities,
joint enrichment and reprocessing facilities, joint
enrichment guarantees, spent fuel storage as needed to
support such arrangements, and an eventual international
fuel bank.
Finally, the Department supports the Review Group's
recommendations for strengthened fuel assurances, in-
creased enrichment capacity which could support fuel
exchange arrangements, and an appeal for passage of the
NFAA as an essential ingredient in our non-proliferation
strategy. It strongly supports strengthened high-level
diplomatic approaches to other supplier governments, on
a confidential basis in the first instance, seeking a
one-to-two year moratorium on exports of sensitive
facilities and pursuing possible fuel pooling arrange-
ments as a means of minimizing commercial competition
in fuel cycle services.
CONFIDENTIAL
CONFIDENTIAL
- 5 -
3. Domestic Reprocessing Options. The Department
is not in a position to make a comprehensive judgment
on the domestic benefits of the various reprocessing
options presented in the report. As the report notes,
the economic benefits of domestic reprocessing are
uncertain and possibly marginal.
From the point of view of our international and non-
proliferation interests, domestic decisions on reprocessing
and recycle may have an important impact in two respects:
-- A perception internationally that the US has taken
a decisive step toward plutonium recycle may make national
reprocessing appear both more respectable and more
economically attractive. We could argue that such a step
is justified because of the size of the US nuclear program,
but it is not clear whether this would overcome such perceptions,
particularly when announced as a Presidential initiative.
-- The possession or lack of a US reprocessing
capability may have an important effect on our ability
to negotiate workable joint fuel-exchange arrangements
with other suppliers.
Negative international perceptions could probably
be reduced to an acceptable level if the US were to
begin a limited program, but only if its size, sub-
stance, and rationale were consistent with a larger US
non-proliferation program which received general
international credence. In sum, our domestic and inter-
national choices must be part of an integrated whole.
Provided that an international policy along the
lines we have recommended is also adopted, the Depart-
ment can support adoption of Option 1, to "assist
industry to gain experience with reprocessing, with
certain modifications, along the following lines:
-- The program should be identified from the out-
set as experimental in nature without prejudging its
outcome, and its content should justify this description;
CONFIDENTIAL
CONFIDENTIAL
- 6 -
-- We do not object to a demonstration project as
proposed, consisting of Government support for the AGNS
plant plus design of a larger plant with no near-term
commitment to construct this second facility;
-- The possibility of substantial Government involve-
ment in any second plant should, however, be held open;
-- There should be aggressive pursuit of alternative
technologies to reprocessing and recycle as an element
of the program;
-- The program should explicitly allow for financial
participation by other nations (both suppliers and con-
sumers) and joint exploration of service arrangements,
but should specifically exclude service commitments or
technology transfers except as part of agreed arrangements
among suppliers.
-- The program should be presented as an integral
part of our overall strategy, with emphasis upon its
potential role in improving safeguards, supporting joint
fuel-exchange arrangements, developing alternative
technologies, and possibly as a future element of an
international fuel bank.
--- The program should be reviewed at the end of
two years to assess the economic and technological
benefits of reprocessing in the light of what has been
learned, and the advisability of proceeding with con-
struction of a plant beyond AGNS, in the light of pro-
gress made toward an international fuel-exchange regime.
4. Strengthened Sanctions. We support a publicly
articulated sanctions policy along the lines proposed
as a means of balancing our non-proliferation and over-
all foreign policy objectives. The proposed approach
includes at least automatic cut-off of US nuclear supply
if our safeguards are clearly breached, reaffirms the
seriousness with which the US would view any safeguards
violations, and stresses the need for consultations
among suppliers and consumers to determine what collective
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actions should be taken. We do not believe that a US
policy should go further than these steps, either in
terms of incorporating explicit non-nuclear responses
or in terms of adopting more rigid unilateral policies.
The Department will consult in advance of a public
statement with other countries, and in particular seek
to elicit comparable statements from other key suppliers.
We will also pursue diplomatic efforts to gain multi-
lateral supplier support for IAEA-related initiatives
in this area and seek supplier agreement to curtail
nuclear cooperation with any non-nuclear weapons state
hereafter testing a nuclear device, regardless of whether
safeguards obligations are violated (recognizing that
it is unlikely that France would agree).
5. IAEA Storage Regime: We support promotion of
this concept, with particular near-term emphasis on
storage arrangements for spent reactor fuel. A Presi-
dential statement endorsing this concept and expressing
a willingness of the US to participate, can provide
impetus to our on-going diplomatic efforts in the context
of the London Suppliers' Group and in the IAEA to trans-
late the international storage objective into reality.
We will consult in advance of such a statement with key
suppliers and the IAEA Director General. In both public
statements and private consultations, when discussing
the role of such a storage regime for separated plutonium,
we should be wary of appearing to condone national
reprocessing.
6. Strengthened IAEA Safeguards. We support the
proposed program to sponsor safeguards demonstrations
for sensitive facilities, offer an ERDA laboratory to
support development of new techniques, and explore
possibilities for greater US contributions to improving
agency capabilities. The Department is prepared to seek
cooperation from other suppliers and recipients in rein-
forcing our initiatives, and believes that a public
statement surfacing these proposals would be useful in
this connection.
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7. Strengthened Physical Security. We support a
policy of strengthening and standardizing physical
security over nuclear materials. We have made significant
progress in establishing physical security guidelines
for suppliers to follow as result of the London Suppliers'
understandings. Before going beyond these agreed standards,
the US should first seek to bring its own national stan-
dards up to these levels. The concept of an international
convention -- which has been proposed internationally in
1974 and again in 1975 in the UNGA and explored diplomatically
with other suppliers and in the IAEA context -- could be
mentioned as part of an overall nuclear policy statement.
But it should be recognized that the prospects for strong
mandatory provisions as well as early negotiation of such
a convention are limited.
8. Waste Management. We support the review group's
recommendations on waste management, but further recommend
that the US publicly propose the pursuit of international
R&D initiatives in this field. We also propose that specific
attention be given to the question of whether the US could
accept foreign waste, if we ever entered into an inter-
national reprocessing service program.
9. Non-Nuclear Technologies. The Department supports
these proposals and will work with ERDA in studying pos-
sibilities. However, we do not see substantial opportunities
emerging which could provide an effective near-term deter-
rent to smaller countries desiring to obtain nuclear power
plants. In the proper context, on the other hand, initiatives
in non-nuclear energy cooperation may be helpful in dis-
suading certain countries from acquiring sensitive
nuclear facilities, such as reprocessing plants. In
formulating and implementing any such program, we should
draw upon the efforts we are making in the IEA and in
CIEC to cooperate with LDCs in the energy field. Of
particular importance might be the US proposal for an
International Energy Institute which we are discussing
within the IEA and CIEC, following up the various pro-
posals we made at the UN Seventh Special Session.
10. US Safeguards Effectiveness. We support the
proposals for assuring the effectiveness of US safe-
guards, with the understanding that upgraded intel-
ligence efforts should be responsive to our broader
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non-proliferation policy needs and not injurious to the
IAEA. We would also seek other supplier support for
fall-back bilateral safeguards and work with them to
gain timelier access to IAEA safeguards information.
11. Public Statement. The Department does not
believe that the UNGA would be an appropriate forum
to discuss new non-proliferation policies emphasizing
tougher constraints. While the drama and worldwide
scope of a Presidential UNGA address are positive
factors, such a message would likely be attacked as
restrictive and discriminatory by the less developed
countries, even if balanced by offers of inducements.
On the other hand, a domestic message, perhaps to the
Congress, would present an opportunity to underline
both the safeguards and constraints inherent in our
nuclear policies and the experimental character of
any domestic reprocessing program. If the President
nonetheless selects the UNGA as the forum for a state-
ment on nuclear policy, the Department would recommend
that he emphasize the cooperative aspects of our non-
proliferation policy.
12. Nuclear Policy Organization. Rather than
the proposed Nuclear Policy Council including State,
ERDA and ACDA, we believe that consideration should be
given to continuation of the existing NSC/VPWG mechanism
or a specially constituted Under Secretaries Committee
reporting to the President through the NSC and the
Domestic Council. Instead of establishing another
bureaucratic layer, the Department favors the option
of an Under Secretaries Committee as the most flexible
and coherent means of effectively representing the
interests of the domestic and foreign policy agencies.
Whatever the institutional arrangement, the Department
of course welcomes the review group's support of its
lead responsibility (in coordination with other
relevant agencies) in the diplomatic and foreign policy
elements of US nuclear policies.
September 4, 1976
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