Soviet Government Cancels Trade Agreement with the U.S.

Key Senate and House members today expressed surprise and most reserved immediate comment on the Soviet government’s repudiation of its 1972 trade agreement with the United States and its refusal to accept conditions based on recently adopted American laws. Senator Henry M. Jackson (D. Wash.), who initiated and led the Senate in imposing restrictions on trade benefits and credits to the Soviet Union unless it modified its emigration practices toward Soviet Jews and others, said he would issue a statement, possibly late today.

Others, like Senator Russell Long (D.La.), chairman of the Senate Finance Committee which heard Secretary of State Henry A. Kissinger say on Dec. 3, that the compromise he had reached with Senators Jackson, Abe Ribicoff (D.Conn.) and Jacob K. Javits (R.NY) was satisfactory to him, indicated through aides that they felt the Soviets also had agreed to the compromise arrangements.

Rep. Charles A. Vanik (D.Ohio), who led the emigration phase of the trade legislation in the House, said that he regretted the Soviet action and hoped the Soviet government would change its mind, “We can in no way force credits or most favored nation treatment on any nation,” Vanik said in a brief statement.

CLOSED DOOR MEETING SET

Senators noted that they would reserve comments since Kissinger, who announced the Soviet nullification of the trade agreement last night, will appear Friday morning before the Senate Foreign Relations Committee behind closed doors. This session originally was booked a week ago to discuss world affairs in general but it now appeared the Soviet act would be high on the agenda.

Some Senators and Representatives advocated caution and no denunciation of the Soviet government, Kissinger or the Congress which virtually was unanimous in adopting both the trade law with its Jackson-Vanik amendment, and the Export-Import Bank law that puts a ceiling of $300 million in credits to the Soviet government over the next four years.

The Soviets had expected to get some $8 billion from the United States to develop its Siberian gas and oil fields. The Export-Import Bank restrictions, plus the 18-month trial period for Soviet emigration practices in the trade bill appeared to be the fundamental basis for the Soviet repudiation, but some felt there was more to it.

KREMLIN POWER STRUGGLE A FACTOR

“We ought to sit back and wait before we talk too much,” one moderate Senator said, asking that his name not be used since he would appear to be violating his own advice. “The Kremlin apparently is engaged in a bitter back yard quarrel. Between Oct. 18 when the Kissinger-Jackson compromise was announced and Dec. 18 when the letter to Kissinger from Soviet Foreign Minister Andrei Gromyko made known strong Soviet displeasure over the legislation, something happened, it seems, within the Kremlin leadership.”

Continuing, the Senator said, “We don’t know if the Soviets are making a change in leadership. If so, the denunciation of the trade agreement may be symptomatic of that since new leaders in the Soviet system always attack the last leadership on some major element. Usually the new leaders go back to the previous position. But it may be that the present leadership acted this way to blunt the opposition’s attack. We should know what is taking place within a few days.”

KISSINGER SEEKS UNIFIED APPROACH

Kissinger himself appeared to wish for a unified approach by Congress and the Administration on the issue with the Soviet government and its bearing on detente. “As far as the Administration is concerned,” Kissinger told reporters, “it will pursue the objectives in a spirit of cooperation with the Congress.” He said he would seek the Senate Foreign Relations Committee’s “advice as to the steps that in their judgement might be desirable in promoting the cause and the purposes which we all share.”

Kissinger cautioned that there is “no point in reviewing the debate of recent months” and that “we want to make clear that there was no disagreement as to objectives.” He also said that “we have no reason to believe that the rejection of the provisions of the trade bill has implications beyond those that have been communicated to us” by the Soviet government, and that “should it herald a period of intensified pressure” then the “United States would resist with great determination and as a united people.”

Kissinger added, “We do not expect that to happen, however, and as far as the United States is concerned, we will continue to pursue the policy of relaxation of tensions, and of improving or seeking to improve relationships, leading towards a stable peace.”

ROLE OF EX-IM BANK CEILING

While the prepared statement Kissinger read to the reporters and of which the Soviet government was aware seemed to stress the Soviet objections to the trade bill and the old objection of “domestic interference,” the Secretary in his responses to reporters’ question put much more emphasis on the money factor in the Soviet considerations.

At one point Kissinger observed that “since the exchange of letters (between him and the three Senators), there have been many public statements that were difficult for the Soviet Union to accept, and the decision with respect to the Export-Import Bank ceiling was undoubtedly an important factor in leading to this turn of events.” In another passage, he said that after the passage of the trade act and the Ex-Im legislation, the Soviet Union “made clear in a number of ways; including public comments, its displeasure with the legislation.”

“I think what may have happened,” Kissinger said near the close of his news conference, “is when the Soviet Union looked at the totality of what it had to gain from this trading relationship as against the intrusions in its domestic affairs, it drew the balance sheet of which we have the result today. But they have never disavowed the assurances or the statements in my letter.”

FUTURE OF JEWISH EMIGRATION

As for the future of Soviet Jewish emigration as a result of the repudiations, Kissinger said, “We have been given no official communication.” He said, “I would not want to speculate” when he was asked if he thought the number of emigrants would decline. “The United States has made clear before that we favored the widest possible emigration, and we did so privately. And, for a time, not ineffectively.”

Kissinger recalled that he had “stated explicitly that if any claim were made that this (the agreement on emigration) was a government to government transaction, and if any assertions were made that assurances had been extended, that those would be repudiated by the Soviet government.” In this connection, Kissinger immediately added that there “were a number of reasons that led to the Soviet decision” and that “the purpose of my remarks was not to put the blame anywhere, but in order to put the debate behind us and to turn us towards the future.”

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