Foreign Relations of the United States, 1981–1988, Volume III, Soviet Union, January 1981–January 1983

206. Memorandum From the Director of Policy Planning (Wolfowitz) to Secretary of State Shultz¹

Washington, August 27, 1982

SUBJECT

• Soviet Strategy Seminar

You opened Saturday’s meeting by asking the participants’ view of the Soviet Union and of the relationship we should seek with it. The discussion that followed brought to light three fundamentally different approaches to Soviet-American relations, with disagreements among them centering on whether and how the two sides’ competition can be moderated. There was the familiar disagreement between the view that it can be moderated only by the break-up of the Soviet Union, and alternately, the view that it can be adequately moderated by the right bargaining approach on issues that affect Soviet interests. A third analysis, which emphasized the importance of blocking Soviet opportunities, assumed no fundamental moderation is possible.

Not every participant, of course, fits neatly into the following description of these views. This is sometimes due to shadings in their view, sometimes to outright contradiction.

Three Outlooks

1. For the bargainers, the key to a satisfactory relationship lies in positioning ourselves to maximize our bilateral leverage. There is a potential for mutual accommodation, created by the vulnerabilities of the Soviet system (and resultant Soviet caution). Yet to exploit this potential several steps are needed: trade must increase substantially, the U.S. government must acquire the legal power and flexibility to control trade, and we must earn European confidence and cooperation by setting out a balanced strategy for using this leverage. To further strengthen this cooperation, we must also assign the highest priority, not only to conducting arms talks, but to the early conclusion of an agreement, even though its impact on the overall balance is expected to be negligible. The bargainers favor other agreements as well, and express confidence that the use of rewards and penalties will facilitate “rules of the game” for competition in the Third World. Although based on a picture of Soviet weakness, this view foresees an enduring relationship even as the weakness passes: our task is to limit the Soviet Union’s misbehavior, and this will be possible even as it prospers.

2. For the proponents of breaking the Soviet Union up, the West’s only choice is between a Soviet demise and the “Finlandization” of Europe. With no basis left for a stable relationship, contacts must be kept to a minimum. Arms control merely unravels our defense efforts, and trade merely creates reverse leverage against the West; in this way, the Soviets have exploited Western internal weakness in the past. Now, however, the application of economic pressures is the key to Western success: the Soviet Union’s internal weakness (above all, its economic crisis) is great enough to bring it down, if—and only if—the US squeezes. To do so requires the same government control over economic relations that the bargainers desire. On the basis of such an all-out struggle, the problem of managing Western public opinion can also be solved: our leaders, rather than offer a complex and multi-faceted relationship with the enemy, can now hold out victory. (They do not, however, have to scare our people: the pressure tactics of the break-up school are “risk-free.”)

3. Those who focus on blocking Soviet misbehavior spell out the implications of concluding that the competition cannot be fundamentally moderated: first, that overturning the Soviet system requires more leverage than we have; second, that bargaining directly with the Soviets—on trade or arms control—gives us less leverage than we need. Effective leverage comes instead from creating an environment in which Soviet opportunities are limited, and Soviet advances can be resisted—through an improved military balance, cooperation with like-minded states, and promotion of political and economic stability. Trade and arms control are not incompatible with this approach, but the marginal benefits they yield must be strictly weighed against the confusing signals they send our own public. Economic pressures are also not incompatible, but because they too yield only marginal benefits these have to be weighed against the damage done to our efforts to promote cooperation and unity with other states.

Assessment

All three of these outlooks are found in the Administration, and obviously have some ground in common. In particular, all emphasize the importance of pursuing a policy that can sustain public support over the long term. You heard some sophisticated advice from all sides about managing this difficult problem:

—The bargaining partisans point out that a showy openness to negotiation is not enough. To command the public and allied support that will strengthen our negotiating hand, we need a convincing strategy that promises results, that can get from here to there.

—The break-up advocates would sustain public support by stating our differences with the Soviets in maximum terms, in principled, ideological rhetoric.

Yet both of these analyses expect to put the Soviet-American relationship on a new basis, and for this reason they may compromise sustainability for other goals. For example:

—The bargainers set an extremely stiff test for showing that our policy is realistic and effective: in this way an early arms agreement becomes a top priority. The paradoxical conclusion is that the only way to sustain a long-term competitive posture is to satisfy the public’s desire for an end to competition. In practice, this may be simply self-defeating.

—The bargainers’ view of economic leverage makes the same compromise. To strengthen our hand in the long run, we have to increase the US share of East-West trade; in the short run, this is not likely to convince our allies to practice restraint. If it does not, our leverage will not increase.

—The break-up school similarly compromises its long-term prospects for a massive effort in the short run. Our allies and our publics will demand early results, which may prove unattainable.

Implications

The problem of sustainability, by contrast, looks most acute to those who envision continuing Soviet opportunities throughout (and beyond) this decade. The blocking strategy you heard at the meeting rejected our bilateral leverage toward the Soviets as marginal. In this view, there is less to be gained and more to be lost by nuanced use of rewards and penalties. The key word here is “simplicity.” The economic, diplomatic and security dimensions of our policy must be consistent.

This seemed to me a very powerful line of argument. The Soviet Union retains considerable flexibility and our policy must serve us whether the Soviets hunker down for a few years or take a more confrontational line. One difficult problem is left unresolved, however: our approach to negotiation. The public wants consistency but it also wants all means for resolving conflicts explored. And those who have least hope of moderating the competition for good are always suspected of negotiating half-heartedly.

If we are not to be whip-sawed by these conflicting pressures, we need a fuller negotiating strategy, particularly for arms control, but extending to other areas as well. We run risks whether we stand indefinitely by radical proposals or fall back to positions that seem to call the competition off. To resolve this problem, we need to see the fundamental difference between agreements that put the competition on a new, qualitatively safer basis and those that affect it marginally at best. In the right circumstances, either one can be acceptable as long as we know—and the public knows—which is which. If we are settling for second-best, it should be clear that we are settling, and that the broader competition goes on. An innovative approach (botched in the follow-up) to solving this problem was the Carter Administration’s March 1977 double offer on SALT: letting the Soviets choose between major and marginal change. Our problems are a bit different now, but this may not be a bad model for our relationship as a whole.

1. Source: Reagan Library, Richard Files, CHRON 09/15/1982–09/19/1982. Secret; Sensitive. Printed from an uninitialed copy. Under a September 9 covering letter, Shultz forwarded Wolfowitz’s memorandum to Clark. (Ibid.) An unsigned and undated letter from Clark to Shultz reads: “Dear George: Thank you for the report on your August 21 seminar on U.S.-Soviet relations which was read here with great interest. The distinction between the three approaches which surfaced at the meeting seems well to reflect the dominant currents of public opinion in this country as well as the options available to us. It will be very useful in the drafting of the NSDD on this same subject which is now in progress.” (Ibid.) For another account of the August 21 meeting, see Document 205.