US Economic Statecraft for Survival 1933-1991 Part 14

66 Seidman box 53, folder: CIEP 9, G.Weiss via W.F.Gorog to Seidman, 1 July 1976.

67 Mastanduno, Economic Containment, pp. 1889.

68 Malloy, Economic Sanctions, pp. 5862, and Long, US Export Control Policy, p.

56. 69 EAA amendments 1974, PL 93500, 29 Oct. 1974. Seidman box 66, folder: Export Licensing Procedures, p. 119. 70 DoD Appropriations Authorization Act of 1975, PL 93365, 5 August 1974; Seidman box 66, folder: Export Licensing Procedures, p. 119.

71 Yergin, 'Politics and Soviet-American Trade', pp. 51718.

72 McCormick, America's Half Century, p. 200.

73 Dobrynin, In Confidence, p. 386: 'Carter obviously believed he could harmlessly separate his public statements about human rights from the whole package of the US-Soviet problems.' 74 Jimmy Carter, Keeping Faith: Memoirs of a President (Bantam, New York, 1982), p. 143. 75 John Dumbrell, American Foreign Policy: Carter to Clinton (Macmillan, Basingstoke, 1997), p. 5, source National Journal, 19, 1980, Harris Polling.

76 In 1973 David Rockefeller founded the Trilateral Commission to promote better relations between the democratic industrial blocs of North America, Western Europe and j.a.pan. It is a highly exclusive club, to which most of the Carter Administration belonged, including Carter, Brzezinski, Vance, Harold Brown, Michael Blumenthal and Warren Christopher. For an important scholarly study of the Commission, see Stephen Gill, American Hegemony and the Trilateral Commission (Cambridge UP, Cambridge, 1990).

77 Cyrus Vance, Hard Choices: Critical Tears in America's Foreign Policy (Simon & Schuster, New York, 1983), p. 31.

78 Zbigniew Brzezinski, Power and Principle: Memoirs of the National Security Adviser, 19771981 (Farrar, Straus & Giroux, New York, 1985), p. 148. See also: Gerry Argyris Andrianopoulos, Kissinger and Brzezinski: The NSC and the Struggle for Control of US National Security Policy (Macmillan, Basingstoke, 1991), pp. 1834.

79 McCormick, America's Half Century, p. 200. 80 Dobrynin, In Confidence, p. 389. 81 NIE 11- 3/8 -76, 'Soviet Strategic Capabilities and Objectives', report to Congress signed by Bush and Defense Secretary Rumsfeld, 27 Jan. 1977. Garthoff, Detente and Confrontation, pp. 7836. 82 R.C.Thornton, The Carter Tears: Toward A New Global Order (Paragon House, New York, 1991). John Dumbrell's comment on Thornton's thesis is that it 'strains credibility': this author agrees. Dumbrell, American Foreign Policy, p. 42.

83 Andrianopoulos, Kissinger and Brzezinski, pp. 1834.

84 Njolstad argues that it was largely because of the more a.s.sertive Carter Administration policy towards the Soviet Union that caused the breakdown of detente: Olav Njolstad, 'Key of Keys: SALT 2 and the Breakdown of Detente', in Odd Arne Westad (ed.), The Fall of Detente: Soviet-American Relations During the Carter Years (Scandinavian UP, Oslo, 1997). This collection offers other interesting perspectives on this matter.

85 Brzezinski, Power and Principle, p. 461; Andrianopoulos, Kissinger and Brzezinski, p. 181; McCormick, America's Half Century, p. 205.

86 Huntington, 'Trade Technology and Leverage', p. 64.

87 An episode at the Rambouillet summit in 1975, ill.u.s.trates both US att.i.tudes towards arms trade with China and that linkage could be played both ways. The Chinese were interested in buying British vertical-take-off Harrier jets. In response to this Brezhnev 'wrote letters to Carter, Giscard [d'Estaing], Helmut Schmidt and myself [James Callaghan], going so far as to imply that unless the United States pressurised Britain and France not to supply arms to China, the SALT Agreement would be in danger.' The allies agreed that they could not bow to such pressure. In fact, in the end no Harriers were sold. The Chinese claimed that they were too expensive, but a 7year UK-Chinese trade agreement was soon signed. Callaghan, Time and Chance, p. 530. 88 Fred Bucy, 'Technology Transfer and East-West Trade: A Reappraisal', International Security, 5(3), 1980/81, pp. 13251, at p. 137.

89 Ibid., p. 134.

90 Ibid., p. 150; see also Bucy, 'On Strategic Technology Transfer to the Soviet Union', International Security, 1 (4), 1977, pp. 253.

91 Huntington, Trade, Technology, and Leverage, p. 65.

92 Ibid., pp. 67 and 69.

93 As my colleague Dr. Steve Marsh has observed, there is an enormous hinterland of diplomacy and policy involved with the oil industry and US economic statecraft. However, given the fact that the Soviet Union was the world's largest oil-producer, there were definite limitations on oil diplomacy in this context. The main US policy concerned controls on oil industry technology, which is covered here in considerable detail. For a broader perspective readers might wish to consult Daniel Yergin, The Prize: The Epic Quest for Oil, Money, and Power (Simon & Schuster, London, 1991).

94 Huntington, Trade Technology and Leverage, p. 71.

95 Ibid., p. 79.

96 Carter, Keeping Faith, p. 220.

97 Garthoff, Detente and Confrontation, p. 589.

98 'The International Energy Situation, Outlook to 1985', April 1977, and 'Prospects for Soviet Oil Production', ER 7710270, April 1976, released April 1977, both by the CIA, see Steven Elliott, 'The Distribution of Power and the US Politics of East-West Energy Controls', in Bertsch (ed.), Controlling East-West Trade, p. 75; Jentleson, Pipeline Politics, pp. 1512.

99 Huntington, 'Trade Technology and Leverage', p. 70.

100 Adrianopoulos, Kissinger and Brzezinski, p. 204.

101 Carter, Keeping Faith, p. 299.

102 Ibid., p. 194, Diary entry 16 May 1978.

103 See Dobrynin, In Confidence, ch. 5.

104 A few weeks earlier Bergland had returned from Eastern Europe and the Soviet Union, where he reported they were all keen to increase trade. He wanted to follow up various proposals and 'further our agricultural relations generally', Carter Library (hereafter Carter Lib.), WHCF, Subject File box CO 64, folder: CO 167 6/1/78 12/3/78, Bergland to Carter, 16June 1978.

105 Brzezinski, Power and Principle, p. 323.

106 Lisa L. Martin, Coercive Co-operation: Explaining Multilateral Economic Sanctions (Princeton UP, Princeton, 1992), p. 200.

107 Brzezinski, Power and Principle, p. 324; Elliott, in Bertsch (ed.), Controlling East-West Trade, p. 77. Of 476 items subject to licences, 115 were revoked, 54 cancelled and 26 suspended, see Elliott, in Bertsch (ed.), Controlling East-West Trade.

108 Elliott, in Bertsch (ed.), Controlling East-West Trade.

109 Carter Lib., Staff Offices, Counsel Cutler box 74, folder: Export Control 1/79 8/80, Joe to Lloyd, 9 Jan. 1979.

110 Carter Lib., Staff Offices, Lipshutz, box 6, Folder: Jackson-Vanik Amendment, and Washington Post, 23 March 1979.

111 Carter Lib., Special Adviser to the President, Moses box 9, folder: Jackson-Vanik, Washington Post, 17 May 1979; Garthoff, Detente and Confrontation, p. 730.

112 Washington Post, 17 May 1979.

113 Carter, Keeping Faith, p. 250.

114 See Garthoff, Detente and Confrontation, and Brzezinski, Power and Principle.

115 Elliott, in Bertsch (ed.), Controlling East-West Trade.

116 Robert Cullen (ed.), The Post-Containment Handbook: Key Issues in US-Soviet Economic Relations (Westview, Boulder, 1990), p. 19. There were also continuing worries about the anomalies between trade practices with the Soviets and those with the Chinese, see Carter Lib., WHCF, Subject File Foreign Affairs, box FO-46, Javits to Carter, 4 Jan. 1979.

117 Fungiello, US-Soviet Trade, p. 190.

118 Malloy, Economic Sanctions, pp. 64 and 667.

119 1979 Export Administration Act, PL 9672.

120 Mastanduno, Economic Containment, p. 268; Stephen Woolc.o.c.k, Western Policies on East-West Trade (Routledge & Kegan Paul, London, 1982), p. 41.

121 Long, US Export Control Policy, pp. 727; see also Long, 'The Executive, Congress, and Interest Groups in US Export Policies: the National Organization of Power', in Bertsch (ed.), Controlling East-West Trade.

122 Long. US Export Control Policy, p. 77.

123 1979 Export Administration Act, PL-967 2.

124 For a detailed discussion of the implications of the act, written at the time of the Afghanistan crisis, see Carter Lib., Staff Offices, Counsel Cutler, box 74, folder: Export Control 1/798/80, Homer Moyer to Cutler, 6 Jan. 1980, subject, EAA requirements. Another source of legal powers in this field was the 1977 International Economic Emergency Powers Act (IEEPA). This basically took Section 5b of the Trading With The Enemy Act and applied it for peacetime use. In circ.u.mstances of a national emergency the President can use the IEEPA to impose sanctions. In the 1980s Reagan used the IEEPA when Congress failed to renew the EEA and for sanctions, for example against Libya and Nicaragua; see Malloy, Economic Sanctions, pp. 13959; and Carter, International Economic Sanctions, p. 184.

125 David D.Newsom, The Soviet Brigade in Cuba: A Study in Political Diplomacy (Indiana UP, Bloomington, 1987).

126 Brezhnev-Honecker conversation, 4 Oct. 1979, DDR Bundesarchiv DY30 JIV 2/201/1342, quoted from Westad (ed.), Fall of Detente, pp. 31314.

127 Boyle, American-Soviet Relations, p. 196.

128 The Soviets had set up a special group to track events in and decide on policy for Afghanistan. It consisted of Dimitri Ustinov, Defence Minister, Andrei Gromyko, Foreign Minister, Yuri Andropov, KGB Chairman, and Boris Ponomarev, head of the Central Committee International Department.

10 Through the second Gold War to liberation 1 Carter, Keeping Faith, p. 473.

2 Ronald Reagan, An American Life (Pocket Books, New York, 1992), p. 589.

3 Lundborg, Economics of Export Embargoes, p. 29.

4 Congressional Quarterly Weekly Report, 26 January 1980, p. 201; see also Hufbauer and Schott, Economic Sanctions Reconsidered, for chronology of key events, pp. 6557.

5 Carter, Keeping Faith, p. 473, diary entry 3 Jan. 1980.

6 Mastanduno, Economic Containment, pp. 2234, deduces similar a.n.a.lytical categories from the Carter Administration's range of responses, but the consequences he draws from them are somewhat different to those claimed here. It should also be noted that there was a new emphasis on naval power, which had important implications for the US strategic position in the Middle East.

7 Carter, Keeping Faith, p. 474.

8 Robert L.Paarlberg, in Nincic and Wallensteen (eds), Dilemmas of Economic Coercion, pp. 13155, at p. 135; see also Paarlberg, 'Lessons of the Grain Embargo', Foreign Affairs, 59 (1), 1980, pp. 14462. Paarlberg was the Chief Economist, US Department of Agriculture.

9 Scholars and writers such as Baldwin and Renwick, have rightly pointed out that sanctions do have effects, often more than they are given credit for, and that they should be regarded as a valuable, if limited, form of statecraft. Their value, in part, is that they are forms of coercion that fall short of outright military violence. What such writers tend to understate, and even Baldwin I think does so, is the economically non-instrumental aspects of sanctions: Baldwin, Economic Statecraft; Robin Renwick, Economic Sanctions, (Centre for International Affairs, Harvard University, Cambridge MA, 1981).

10 All these points are clearly reflected in Brzezinski's account in Power and Principle, p. 430; see also, P.L.Falkenstein, 'Post Afghanistan Sanctions', in D.Leyton-Brown (ed.), The Utility of Economic Sanctions (Groom Helm, London, 1985).

11 Brzezinski to Carter, 26 Dec. 1979, Brzezinski doc.u.ments, Carter/Brezhnev Collection, National Security Archive, quoted from Westad (ed.), Fall of Detente, pp. 32932, at p. 329.

12 Ibid., p. 331.

13 Ibid.

14 Carter, Keeping Faith, p. 472. See also Carter Lib., Staff Offices Counsel, Cutler, box 74, folder: Export Control 1/798/80, Acting Secretary of Agriculture James Williams statement on support for farmers and points for briefing Congress, 8 Jan. 1980, and ibid., Chief of Staff Jordan, box 56, folder: USSR/Afghanistan Embargo, Richard Moe, Office of the Vice President to Jordan et al., 8 Jan. 1980, which also reveal thinking of the Administration.

15 Bertsch and Elliott, in Bertsch (ed.), Controlling East-West Trade, p. 213, describes British support as 'lukewarm'; Mastanduno, Economic Containment, is rather uncharacteristically ambiguous, in that he claims that the USA failed to engage allied support for the new economic defence policy that it wished to deploy and yet was willing to 'bolster the strategic embargo', p. 230. There is further discussion of this below. Martin, Coercive Cooperation, pp. 194203, on the other hand, makes a rather unconvincing contrast between allied unresponsiveness to US measures aimed at retaliation for ill-treatment of Shcharansky and others in 1978 and 'bandwagoning' in 1980, as the allies followed the US lead because it was clear that the USA was prepared to shoulder costs and set a worthy example. She makes little of the fact that the allies perceived the Afghan invasion in much more serious political and strategic terms than mistreatment of Soviet dissidents.

16 Margaret Thatcher, The Downing Street Years (HarperCollins, London, 1993), p.

88. 17 Brzezinski, Power and Principle, p. 431. 18 The job of the Iowa caucus of Democratic Party activists was to choose delegates for the Democratic Party National Convention, which later in the year would choose the party's presidential candidate. If the delegates chosen were not Carter supporters, this would not only lose him votes from Iowa, its effect on public opinion would also damage his re-election campaign in general.

19 Garthoff, Detente and Confrontation, p. 951. While Garthoff is right to emphasise the importance of domestic factors, I do not think that they were as decisive as Carter's fears about possible further Soviet aggression and the need to convey effectively US resolve and moral outrage at the Soviet invasion of Afghanistan.

20 Brzezinski, Power and Principle, p. 431. 21 NSC meeting on Afghanistan, chaired by Carter, 2 Jan. 1980, Vance doc.u.ments, Carter-Brezhnev Collection, National Security Archive, quoted from Westad (ed.) Collapse of Detente, p. 350.

22 Ibid., p. 339.

23 Ibid., p. 342.

24 Ibid., p. 343.

25 Ibid., p. 348.

26 Ibid., p. 350.

27 Carter Lib, Staff Offices Counsel: Cutler box 74, folder: Export Control 1/798/80, Joe Onek, Deputy Counsel to the President to Lloyd Cutler, 4 Jan. 1980.

28 Ibid, box 76, folder: Grain, Eizenstat to Carter, 3 Jan. 1980.

29 Ibid.

30 Brzezinski, Power and Principle, pp. 4312.

31 Carter, Keeping Faith, pp. 4756, Diary 4 Jan. 1980.

32 Carter Lib, Chief of Staff Jordan box 56, Folder: USSR/Afghanistan Embargo, Jordan to Carter, 5 Jan. 1980.

33 Carter Lib, Staff Offices Counsel: Cutler, box 74, folder: Export Control 1/798/80, Benjamin Civiletti to Cutler 10 and 17 Jan. 1980; and ibid, box 76, folder: Grain- Cutler notes 13/80, Onek to Cutler 11 Jan. 1980.

34 Carter, International Economic Sanctions, p. 71; Long, US Export Control Policy, p. 78; and K.Abbott, 'Linking Trade to Political Goals: Foreign Policy Export Controls in the 1970s and 1980s', Minnesota Law Review, 65, pp. 73956, 1981. 35 Carter Lib, Staff Offices Counsel: Cutler, box 76, folder: Grain-Cutler notes I 3/80, Cutler memo Subject: Report to Congress under EAA 1979.

36 Ibid, folder: Grain memos 1/1731/80, Cutler to Carter, 18 Jan. 1980.

37 There were bipartisan proposals for the repeal of the embargo in both houses of Congress in the summer of 1980, but they came to nothing, Long, US Export Control Policy, p. 79.

38 At the end of September 1980 US farm prices were higher than in January, Carter Lib, Staff Offices: Domestic Policy Staff Eizenstat, box 112, folder: Grain Suspension 11/12/80, Eizenstat to Senator Pressler, 12 Nov. 1980.

39 Paarlberg, in Nincic and Wallensteen (eds), Dilemmas of Economic Coercion, p.

147. Paarlberg points out that the embargo was thus not the disaster for US farmers that some of its critics claimed. Fungiello, US-Soviet Trade, appears to go along with the conventional wisdom that the embargo hurt US farmers: 'No wonder Senator Edward Zorinski of Nebraska commented: "With the embargo, this country pointed a gun at Russia and shot the US farmer in the foot'", p. 193. He also offers some rather confusing figures concerning the amounts actually shipped. Cyrus Vance, for his part, suggests in his memoirs that the grain embargo really hurt economically: 'No other measure was as costly to the Soviet Union', which is another aspect of the conventional wisdom that is suspect (Vance, Hard Choices, pp. 38990).

40 Brzezinski, Power and Principle, p. 431. 41 Carter Lib, WHCF, Subject File box CO 65, folder: CO 167 1/1/801/20/81, Brzezinski to UK Amba.s.sador Henderson, 11 Feb. 1980. 42 Ibid, Staff Offices Counsel Cutler, box 77, folder: Grain Memos 3/80, memo for Carter, 25 March 1980. The decision not to control intra-Western trade distin guished the Carter Administration from Reagan's. The latter tried to restrict oil and gas industry technology and penalised its allies when they did not toe the line.

43 Ibid., folder: Grain Memos 410/80, Eizenstat and Lynn to Carter, 5 June 1980.

44 Ibid., folder: Grain Statements 110/80, Agreement with China 22 Oct. 1980; Paarlberg, in Nincic and Wallensteen (eds), Dilemmas of Economic Coercion, p.

137. 45 Carter Lib., Staff Offices Counsel Cutler, box 77, folder: Grain Memos 410/80, Eizenstat and Lynn to Carter, 5 June 1980.

46 Ibid., Staff Offices: Domestic Policy Staff Eizenstat, box 112, folder: Grain Suspension 11/12/80, Eizenstat to Senator Pressler, 12 Nov. 1980. In 1981 it became clear that the embargo had only been marginally effective in economic terms, see subcommittee on Europe and the Middle East of the House Committee on Foreign Affairs, 'An a.s.sessment of the Afghanistan Sanctions: Implications for Trade and Diplomacy in the 1980s', Report by Congressional Reference Services, 1981.

47 Hanson, Western Economic Statecraft, p. 43.