Foreign Relations of the United States, 1969–1976, Volume XXXVIII, Part 2, Organization and Management of Foreign Policy; Public Diplomacy, 1973–1976

164. Memorandum From Charles A. Cooper of the National Security Council Staff to the President’s Assistant for National Security Affairs (Kissinger)¹

Washington, August 16, 1973.

SUBJECT

• CIEP Role on Aid

You should be aware that CIEP is trying to establish a central role for itself on aid policy. If the current CIEP game plan is carried out, our ability to use aid flexibly for foreign policy purposes is likely to be seriously undermined.

Having spent its first two years of existence on international monetary policy (now shifted to Treasury) and trade (on which it has done a credible job) Peter Flanigan is now expanding CIEP’s role to try to include aid policy. He has had a consultant, Stephen Enke, do a major report.² The report is poor and its conclusions would be a foreign policy disaster because they stress the development aspects of aid. We need flexibility in our aid programs to support our foreign policy objectives even if that is not the most effective developmental use of funds. Moreover, we hardly want to create a series of foreign policy problems by pressing hard for population limitation programs and other economic reforms as strict conditions of our assistance. I have indicated our concerns with the study to CIEP (Tab A).³

CIEP has recently added an assistant director for aid matters (Ray Sternfeld) and will now proceed to develop some of the Enke report findings further. State is advanced in preparing a general study of our policies toward the developing studies [countries?]—the Casey report. Treasury has completed a study on the international banks.⁴ Peter Flanigan has announced that he will chair a meeting of CIEP principals in mid-September to deal with aid policy on the basis of these three studies.

This year Congressional cuts, the shortage of PL 480 commodities, and increased foreign policy requirements (Indo-China) mean we will be more constrained than ever before in finding sufficient aid funds for foreign policy purposes. We will face difficult trade-offs such as South Vietnam versus Jordan, Indonesia versus Pakistan. This is not the time to be considering major new rhetoric for the development justification of aid. Nor can we afford to have aid policy set in the CIEP forum where Commerce, Agriculture, Treasury and Labor have equal voice with you and State.

There is much that can be done within present general aid policies to improve the effectiveness of the program while maintaining the foreign policy flexibility you need. We would welcome active CIEP efforts in this field. This is a big job and will keep Sternfeld—who is good—fully occupied. Meanwhile major aid decisions should be staffed and forwarded to the President, not decided by Peter Flanigan after meeting with a group of departments with marginal interests at best.

What we need is to reach an understanding with Flanigan and CIEP to proceed incrementally on aid policy with NSC taking the foreign policy issues and CIEP working on improving implementation and development effectiveness. We shall also have to watch for an opportunity to include the Casey study in a more controlled framework. We have a little time to act as the Flanigan aid policy meeting is not scheduled for another month.

Recommendation:

That you authorize Brent Scowcroft and myself to work with Flanigan and his people on a division of responsibility in this field and get his agreement to proceed by resolving individual problems instead of trying to set broad general aid policies that are not appropriate to present funding levels and will substantially reduce foreign policy flexibility.⁵

1. Source: Library of Congress, Manuscript Division, Kissinger Papers, Box CL 38, Chronological File, 11 Aug.–6 Sept. 1973. Confidential. Sent for action. Printed from a copy that Cooper did not initial.
2. On March 13, Flanigan announced the establishment of the Foreign Assistance and Development Project, under Enke’s direction, in a memorandum to the Secretaries of State, Treasury, Defense, and Commerce; the Director of the Office of Management and Budget; the President’s Assistant for National Security Affairs; and the Administrator of the Agency for International Development. In an attached handwritten note to Kissinger, Scowcroft wrote: “Henry—Are you aware of this? I can’t imagine we want Flanigan mucking around in aid and MAP.” Kissinger noted at the bottom, “Get it stopped.” (National Archives, Nixon Presidential Materials, NSC Files, Box 219, Agency Files, Council on International Economic Policy (CIEP), 1973, Vol. II) Documentation related to Enke’s report is ibid.
3. Cooper’s undated draft memorandum critiquing the Enke report is attached but not printed.
4. Neither study has been further identified or found.
5. Kissinger initialed his approval and added the following note to Scowcroft: “Brent, what exactly are you after?”