Foreign Relations of the United States, 1961–1963, Volume V, Soviet Union

309. Highlights From the Secretary of Stateʼs Policy Planning Meeting⁰

Washington, March 26, 1963.

SUBJECT

• S/P Paper Entitled: “More on the ‘Khrushchev at Bay’ Thesis”¹

The paper under consideration at the dayʼs meeting was described as an interim product of an S/P project looking toward a post-Khrushchev Russia and the before and after policy implications for the US. The need for an interim review flowed from a series of developments which Embassy Moscow, INR and CIA have been reporting that suggest a quiet but deep crisis is underway in theUSSR and that a sticky and difficult agenda is immediately before the Soviet leadership. The high and growing costs of various Soviet cold war undertakings and commitments, together with prolonged failure to secure worthwhile pay-offs from these, and frictions and conflicts within communist ranks pose serious dilemmas for Khrushchev. He needs badly to score a quick success. If not this, then the leadership will have to make a difficult choice between moderating its policies or girding its loins for a long hard pull, the length and end of which cannot be foreseen.

We can assume that some very basic staff work is being done on an urgency basis in the Kremlin. It consequently behooves us to be unusually alert regarding both dangers and opportunities. The paper emphasizes the importance of our continuing to block communist expansion whether by military or other means in Europe or elsewhere, as well as to counter effectively Soviet efforts to gain significant advantages in the underdeveloped countries. The paper also underscores an earlier concern that the Soviets may be seeking a “quick fix” through an armaments development that would give them, if not a hard military advantage, at least a great psychological boost a la Sputnik. It is of paramount importance that we safeguard fully against this.

Khrushchevʼs great need is not a simple increase in military strength. He has it in his power to get this, despite the costs. But military strength in itself is not the objective. The objective is the attainment of concrete political results. But this raises the question of risk. If Khrushchev wants to move, he must be willing to incur greater risks. The basic issue that faces him is the degree of risk the USSR should run on behalf of communist objectives. If the Kremlin should really “go rough,” we could only conclude a decision had been reached to step up the risk rate. In that case, we had better be set to batten down the hatches.

Conversely, we should recognize the possibility of a move in an entirely different direction. The decision might be to reduce the risks and costs that are bearing down so heavily. For this reason, the paper urges that we keep open lines of communications and take other steps that would lead the leadership to see this alternative course as both feasible and attractive.²

The ensuing discussion centered around the following major points:

1. The importance of periodically reviewing our basic assumptions regarding the Soviet leadership. The timeliness of the S/P paper was generally recognized. We cannot afford, it was said, to lock ourselves into fixed positions as to either the milieu in which the leadership operates or the range of policy choices to which it may be led or forced to resort. We must recognize that the USSR is also subject to change, possibly quite rapid and far-reaching change. No more important matter can be before us than that of discerning and properly appraising the possibility of shifts in the purposes and direction of the leadership. We have been taken by surprise in the past, and often at great costs. We also have doubtless missed some opportunities.

2. The seriousness of the resources pinch. Question was raised as to whether the S/P paper did not exaggerate the significance of the decline in the Soviet economic growth rate. Assumptions of difficulties incident to this were central to the entire thesis of the paper. It should not be forgotten that despite the drop in the percentage rate, a tremendous absolute increase in production is still being effected each year and will certainly continue throughout the foreseeable future. Illustrative is a recently published report on plan fulfillment in Armenia. In every area of economic activity in that republic, extremely impressive gains have been registered in the past year just as they have been in the preceding several years. We need to be cautious when making judgments about the limitations that the slowing down of the growth rate places on the Soviet leaders. Granted economic problems and difficulties exist. These are most serious in agriculture. There have also been exaggerated expectations with regard to automation, something that has led to some important shortfalls in plan fulfillment. But we should not place too great reliance on these adverse factors. The tremendous absolute increases will enable a steady expansion of established programs and the addition of new ones. The way is also open for the regime to shortcut the practices of the US and other western countries in satisfying the demands of the people for a better life for themselves. A case in point is projected development of satellite belts around cities. Here something quite striking—in the eyes of both Russians and foreigners—can be done cheaply.

That Soviet economic expansion continues impressive was generally agreed. It was argued, however, that economic expansion is not inconsistent with a mounting resources pinch. The key factor is that decline in the growth rate is paralleled by an increase in the requirements rate. The resources available to the regime are heavily over-committed. Something has to give somewhere. Quite evidently there are real—and growing—problems of resource allocation. While this is not the only problem facing the regime, it does make all other problems more difficult.

3. How the Soviet leadership may view the situation. According to S/Pʼs analysis, it was pointed out, Khrushchev and his associates have fallen into a “no-win” situation. Can we assume that they see their problems and difficulties as we do? Would it not be a worthwhile exercise to try to draft a defense of Khrushchevʼs policies as he himself might draft it for presentation to his colleagues? What could he say to justify his course, and to still concern over the future? Evidently, he would have to acknowledge that much had gone wrong. The turn in Iraq, for example, would need explaining. What bright spots could he point to? Obviously, he is being confronted by a need to explain and justify in consequence of Chinese communist attacks. There may also be criticism at home. Someone in the Department should attempt to put himself in Khrushchevʼs shoes and draft a reply to his critics. A solid job here could contribute importantly to our understanding.

4. Desirability of the US utilizing communist-generated crises to add to pressures operating on the Soviets. One of the policy recommendations of theS/P paper was that in cases where theUSSR—or communists responsive to theUSSR—were attempting in particular areas to gain advantage at US or allied expense through crisis mongering or some other device, the US should deliberately seek to reverse the tactic and use the situation to put in jeopardy a Soviet-communist interest, or at least to increase steadily the costs of the “crisis operation” for the communist side. The paper made specific reference in this connection to (a) shifting the emphasis in future negotiations on West Berlin to the problem of Berlin as a whole and perhaps to the over-all German problem; (b) countering any increased effort of the communists in Laos and South Viet-Nam, with moves that would threaten North Viet-Nam, and (c) increasing the costs and risks to the USSR of Soviet hegemony over Cuba.

Serious question was raised to practicability and desirability of such a tactic on our part. In the case of Berlin, for example, other considerations than the simple one of increasing pressures on the USSR have to be taken into account. Experience of the last several years has shown little money is to be made from trying to tie Berlin in with an over-all German settlement. In Southeast Asia, we have to face up to what our realistic capabilities are to extend the conflict into the “communist garden.” Unless we are prepared to assume heavy costs to get at North Viet-Nam, we might find it far better to continue to concentrate on containing communist efforts within Laos and South Viet-Nam proper. We need, of course, to study the feasibility of the alternative. But we have to take into account possible reaction and the problems this would present to us. There is also question as to whether an extension of the area of conflict, particularly action aimed at Hanoi, would really be an effective means of getting at the USSR.

5. The problem of safeguarding against a Soviet military breakthrough. Uncertainty was voiced as to whether we are paying sufficient attention to what the Soviets may be able to accomplish in either a strict military sense or psychologically through some sort of weapons advance. This was characterized as perhaps the most important matter raised by the paper. Two possibilities were open: an effective anti-missile missile system, and an impressive space weapon. With regard to the latter, we may have become prisoners of our own thinking. We are fond of saying bombs in space would not be a good first strike weapon. But they would be superb for a second strike. In any event, their psychological impact could be terrific. This whole business needs thinking through again without the hindrance of fixed preconceptions.

A counterview held that military men almost without exception discount the importance of weapons in space. It was nevertheless recognized that close attention should be given this matter. We should look at all possibilities with a completely open mind. It would be well, in particular, if arrangements could be made for a thorough briefing on the subject for those participating in this discussion.

6. The problem of the underdeveloped countries. It was felt that we also have special need to increase our alertness with regard to the underdeveloped countries. The Soviets, as the paper noted, had so far not scored any notable successes. But in several instances—Iraq for example—the decision could have well gone in favor of the communists and we would have been unable to do anything about it. The underdeveloped countries still offer the best opportunity for Soviet gains that would enable a breakout from the bind of the moment. We are far from being on safe ground in this area. India remains marginal as does a number of other countries. We cannot afford to rest on the breaks we have so far enjoyed, as these can easily prove transitory. We must stay on the track and increase rather than decrease emphasis and effort. Much more needs to be said on this subject than is in the paper being considered. The Soviets appear to be working with the long term in mind. In Africa, for example, they are evidently concentrating on developing cadres for long range use. Assume that by the end of the decade they should have several African countries locked up, Latin America on the go, plus India, Burma and Pakistan. Would this not serve to offset any immediate problems and clinch Soviet confidence and resolve re the future? If we are to succeed in holding the Soviets in check, no area of operations is more important than the underdeveloped countries.

7. The problem of influencing desirable policy choices of the Soviet leadership. To frustrate the Soviet leadership in its various designs was recognized as a necessary objective. However, a word of warning was thought needed. Frustration can be a dangerous thing to play with. Under certain circumstances it might produce results the exact opposite of what we want. If the Soviets continue to find their low risk policies leading nowhere but deeper and deeper into a mire of difficulties, they might decide to shift to high risk policies.

For this reason, it was stressed, it is particularly important that we provide an escape hatch that might appeal to the Soviet regime but would still not be inimical to our own interests. We should be sure that our efforts at frustration do not include moves threatening to Soviet national interests. We should continually seek areas of agreement. A test ban treaty, if it can be worked out, would help. So would a “no bombs in space” agreement. We might also seek more systematically to play upon the strong Soviet desire for respectability.

Any agreement between the regime and the US was believed likely to have a strong and favorable impact on the Russian people. The Russian people want above all else to avoid a nuclear war. They have no interest in the spread of communism. They are opposed to expenditures on behalf of underdeveloped countries. Their main concern is an improvement in their own standard of living. They are basically friendly toward the US. Any agreement with the US would be associated in their minds with greater opportunities for a better life for themselves. This means that even an “atmospherics” agreement might yield important dividends in the way of getting the ball rolling in the desired direction. One agreement would generate popular pressures for another, and so on.

Question was raised about a possible change in our trade policy toward theUSSR. Have we really subjected this policy to the type of review it should have in light of existing circumstances? How important are our restrictive measures against the background of a possible nuclear exchange? How effective are they in view of the nearly $4 billion of trade between our European allies and bloc countries? We need to take a hard new look at this whole question.

A point that should especially be taken into account is the impact of our policy on Soviet attitudes. The Soviet leaders have always shown a special sensitivity over our trade restrictions. This goes back to the days of Stalin and extends to our present efforts re wide diameter pipe. We are approaching a deep split with our allies over pipe sales and probably in the end will not be able to keep the Soviets from getting what they want. Meanwhile, we will have given more ammunition to those of the Soviet leaders who would argue the US is “irreconcilably hostile” to the USSR and its interests as a matter of principle.

Soviet sensitivity over US trade restrictions was seen as deriving from several factors: a resentment over the slight to Soviet prestige and respectability; Soviet belief in the superior quality of American products; faith that with increased trade US businessmen would influence the government favorably toward the USSR.

Improvement in trade relations was viewed as one of the best possible means of moving the Soviet regime along the revisionist road. Rapprochement in the Soviet mind is in fact more closely identified with trade than anything else. From our own standpoint, economic advantage would flow from expanded trade, although there would also be disadvantages in consequence of the improvement that would follow for the Soviet competitive position. This last might be especially serious in the case of oil and civil aviation where Soviet competition is already strong and where adverse political consequences can easily be produced. Aside from other factors that should be taken into account in reviewing our restrictive policies, emphasis as placed on the desirability of increasing Soviet economic dependence on the US. This has probably been given too little weight in the past.

Follow up action suggested by the discussion:

a. Preparation of a closed meeting statement by Khrushchev [Kennedy?] evaluating the present Soviet situation and outlook.

b. A briefing review at an early Planning Meeting of possibilities of the Soviets gaining important military and/or political advantages in weapons development or deployment.

c. A comprehensive review of US policies re trade with the USSR and the satellites.

0. Source: Department of State, S/P Files: Lot 70 D 199, Chron. Secret. No drafting information appears on the source text.
1. A copy of this 72-page, double-spaced paper is ibid., Central Files, POL US-USSR. It states that it takes as a point of departure the summary conclusions reached in Document 228.
2. The S/P paper had been discussed at an NSC Planning Group lunch on March 19 where Rostow posed the problem in terms of Khrushchev being either forced “to withdraw into modern revisionism or revert to a Stalinist hard line.” Robert Komer of the NSC Staff, in a March 19 memorandum to Kaysen reported that most of those present at lunch believed it would be a combination of both. Thompson pointed out the Soviet dilemma in the allocation of resources and stated he thought it possible, though not probable, Khrushchev might run another military bluff. ( Kennedy Library, National Security Files, Countries Series, USSR)