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ments may sometimes be very different from ours,
but events in Africa, the Middle East, and Eastern
Europe teach us never to write off any nation as
lost to the Communists. That is the lesson of our
time. We support the independence of those
newer or weaker states whose history, geography,
economy, or lack of power impels them to remain
outside ''entangling alliances'' — as we did for more
than a century. For the independence of nations

is a bar to the Communists' "grand design" — it is
the basis of our own.

In the past year, for example, we have urged a
neutral and independent Laos, regained there a
common policy with our major allies, and insisted
that a cease-fire precede negotiations. While a
workable formula for supervising its independ-
ence is still to be achieved, both the spread of
war — which might have involved this country
also— and a Communist occupation have thus far
been prevented.

A satisfactory settlement in Laos would also
help to achieve and safeguard the peace in Viet-
Nam, where the foe is increasing his tactics of
terror, where our own efforts have been stepped up,
and where the local government has initiated new
programs and reforms to broaden the base of re-
sistance. The systematic aggression now bleeding
that country is not a "war of liberation," for Viet-
Nam is already free. It is a war of attempted sub-
jugation — and it will be resisted.

The Atlantic Community

Finall}^ the united strength of the Atlantic com-
munity has flourished in the last year under severe
tests. NATO has increased both the number and
the readiness of its air, ground, and naval units —
both its nuclear and nonnuclear capabilities.
Even gi'eater efforts by all its members are still
required. Nevertheless our unity of purpose and
will has been, I believe, immeasurably strength-

The threat to the brave city of Berlin remains.
In these last 6 months the Allies have made it un-
mistakably clear that our presence in Berlin, our
free access thereto, and the freedom of 2 million
W^est Berliners would not be surrendered either to
force or through appeasement — that to maintain
those rights and obligations we are prepared to
talk, when appropriate, and to fight, if necessary.
Every member of NATO stands with us in a com-
mon commitment to preserve this symbol of free
man's will to remain free.

I cannot now predict the course of future nego-
tiations over Berlin. I can only say that we are
sparing no honorable effort to find a peaceful and
mutually acceptable resolution of this problem.
I believe such a resolution can be found and with
it an improvement in our relations with the Soviet
Union, if only the leaders in the Kremlin will rec-
ognize the basic rights and interests involved and
the interest of all mankind in peace.

{January 29, 1962


But the Atlantic community is no longer con-
cerned with purely military aims. As its common
imdertakings grow at an ever-increasing pace,
we are, and increasingly will be, partners in aid,
trade, defense, diplomacy, and monetary affairs.

The emergence of the new Europe is being
matched by the emergence of new ties across the
Atlantic. It is a matter of undramatic daily co-
operation in hundreds of workaday tasks: of cur-
rencies kept in effective relation, of development
loans meshed together, of standardized weapons
and concerted diplomatic positions. The Atlantic
community grows, not like a volcanic mountain,
by one mighty explosion, but like a coral reef,
from the accumulating activity of all.

Thus we in the free world are moving steadily
toward unity and cooperation, in the teeth of that
old Bolshevik prophecy and at the very time when
extraordinary rumbles of discord can be heard
across the Iron Curtain. It is not free societies
which bear within them the seeds of inevitable

Our Balance of Payments

On one special problem, of great concern to our
friends and to us, I am proud to give the Congress
an encouraging report. Our efforts to safeguard
the dollar are progressing. In the 11 months pre-
ceding last February 1, we suffered a net loss of
nearly $2 billion in gold. In the 11 months that
followed, the loss was just over half a billion dol-
lars. And our deficit in our basic transactions
with the rest of the world — trade, defense, for-
eign aid, and capital, excluding volatile short-term
flows — has been reduced from $2 billion for 1960
to about one-third that amount for 19G1. Specu-
lative fever against the dollar is ending, and
confidence in the dollar has been restored.

We did not — and could not — achieve these gains
through import restrictions, troop withdrawals,
exchange controls, dollar devaluation, or choking
off domestic recovei-y. We acted not in panic but
in perspective. But the problem is not yet solved.
Persistently large deficits would endanger our eco-
nomic growth and our militiiry and defense com-
mitments abroad. Our goal must be a reasonable
equilibrium in our balance of payments. With
the cooperation of the Congress, business, labor,
and our major allies, that goal can be reached.

We shall continue to attract foreign tourists

and investments to our shores, to seek increased
military purchases here by our allies, to maximize
foreign-aid procurement from American firms, to
urge increased aid from other fortunate nations to
the less fortunate, to seek tax laws which do not
favor investment in other industrialized nations
or tax havens, and to urge coordination of allied
fiscal and monetary policies so as to discourage
large and disturbing capital movements.


Above all, if we are to pay for our commitments
abroad, we must expand our exports. Our busi-
nessmen must be export-conscious and export-
competitive. Our tax policies must spur moderni-
zation of our plants; our wage and price gains
must be consistent with productivity to hold the
line on prices; our export credit and promotion
campaigns for American industries must continue
to expand.

But the greatest challenge of all is posed by the
growth of the European Common Market. As-
suming the accession of the United Kingdom,
there will arise across the Atlantic a trading
partner behind a single external tariff similar to
ours with an economy which nearly equals our
own. Will we in this country adapt our thinking
to these new prospects and patterns, or will we
wait until events have passed us by ?

This is the year to decide. The Reciprocal Trade
Act is expiring. We need a new law, a wholly
new approach, a bold new instrument of American
trade policy. Our decision could well affect the
unity of the West, the course of the cold war, and
the economic growth of our nation for a genera-
tion to come.

If we move decisively, our factories and farms
can increase their sales to their richest, fastest
growing market. Our exports will increase. Our
balance-of-payments position will improve. And
we will have forged across the Atlantic a trading
partnership with vast resources for freedom.

If, on the other hand, we hang back in deference
to local economic pressures, we will find ourselves
cut off from our major allies. Industries — and I
believe this is most vital — industries will move
their plants and jobs and capital inside the walls
of the Common Market — and jobs therefore will
be lost here in the United States — if they cannot
otherwise compete for its consumers. Our farm
surpluses will pile ujj — and our balance of trade,


Department of State Bulletin

as you all know, to Europe, the Common Market,
in farm products is nearly three or four to one in
our favor, amounting to one of the best earners of
dollars in our balance-of -payments structure — and
without entrance to this market — without the
ability to enter it — our farm surpluses will pile
up in the Middle West, tobacco in the South, and
other commodities, which have gone through
Western Europe for 15 years. Our balance-of-
payments position will worsen. Our consumers
will lack a wider choice of goods at lower prices.
And millions of American Avorkers whose jobs de-
pend on the sale or the transportation or the dis-
tribution of exports or imports, or whose jobs will
be endangered by the movement of our capital to
Europe, or whose jobs can be maintained only in
an expanding economy — these millions of workers
in your home States and mine will see their real
interests sacrificed.

Members of the Congress: The United States
did not rise to greatness by waiting for others to
lead. This nation is the world's foremost manu-
facturer, farmer, banker, consumer, and exporter.
The Common Market is moving ahead at an eco-
nomic growth rate twice ours. The Communist
economic offensive is under way. The opportunity
is ours, the initiative is up to us, and I believe that
1962 is the time.

To seize that initiative, I shall shortly send to
the Congress a new 5-year trade expansion action,
far-reaching in scope but designed with great care
to make certain that its benefits to our people far
outweigh any risks. The bill will permit the
gradual elimination of tariffs here in the United
States and in tlie Common Market on those items
in which we together supply 80 percent of the
world's trade — mostly items in which our own
ability to compete is demonstrated by the fact that
we sell abroad, in these items, substantially more
than we import. This step will make it possible
for our major industries to compete with their
counterparts in Western Europe for access to Eu-
ropean consumers.

On the other hand, the bill will permit a grad-
ual reduction of duties up to 50 percent, permit
bargaining by major categories, and provide for
appropriate and tested fonns of assistance to firms
and employees adjusting to import competition.
We are not neglecting the safeguards provided by
peril points, an escape clause, or the national se-
curity amendment. Nor are we abandoning our

non-European friends or our traditional most-
favored-nation principle. On the contrary, the
bill will provide new encouragement for their sale
of tropical agricultural products, so important to
our friends in Latin America, who have long de-
pended upon the European Common Market, who
now find themselves faced with new cliallenges
which we must join with them in overcoming.

Concessions in this bargaining must of course
be reciprocal, not unilateral. The Common Mar-
ket will not fulfill its own high promise unless
its outside tariff walls are low. The dangers of
restriction or timidity in our own policy have
counterparts for our friends in Europe. For to-
gether we face a common challenge: to enlarge
the prosperity of free men everywhere, to build
in partnership a new trading community in which
all free nations may gain from the productive
energy of free competitive effort.

These various elements in our foreign policy
lead, as I have said, to a single goal — the goal of a
peaceful world of free and independent states.
This is our guide for the present and our vision
for the future: a free community of nations, in-
dependent but interdependent, imiting north and
south, east and west, in one great family of man,
outgi-owing and transcending the hates and fears
that rend our age.

We will not reach that goal today, or tomorrow.
We may not reach it in our own lifetime. But the
quest is the greatest adventure of our century.
We sometimes chafe at the burden of our obli-
gations, the complexity of our decisions, the agony
of our choices. But there is no comfort or se-
curity for us in evasion, no solution in abdication,
no relief in irresponsibility.

A year ago, in assuming the tasks of the Presi-
dency, I said that few generations in all history
had been granted the role of being the great de-
fender of freedom in its hour of maximum dan-
ger. This is our good fortune; and I welcome it
now as I did a year ago. For it is the fate of this
generation — of you in the Congress and of me as
President — to live with a struggle we did not
start, in a world we did not make. But the pres-
sures of life are not always distributed by choice.
And while no nation has ever faced such a chal-
lenge, no nation has ever been so ready to seize
the burden and the glory of freedom.

And in this high endeavor, may God watch
over the United States of America.

January 29, 1962


President Kennedy and Soviet Leaders
Exchange New Year's Messages

Following is an exchange of messages betiveen
President Kennedy and Nikita Khrushchev^
Chairman of the Council of Ministers of the
V.S.S.R., and Leonid Brezhnev, President of the
Presidivmi of the Supreme Soviet of tlie U.S.S.R.

White House press release (Palm Beach, Fla.) dated December 31

President Kennedy to Soviet Leaders

December 31, 1961
Dear President Brezhnev and Chairman
Khrushchev: As the year 1961 approaches its
close I wish to extend to the people of the Soviet
Union and to you and your families my most sin-
cere wishes and those of the American people for
a peaceful and prosperous New Year. The year
which is endinfj has been a troubled one. It is
my earnest hope that the coming year will
strengthen the foundations of world peace and
will bring an improvement in the relations be-
tween our countries, upon which so much depends.
It is our grave responsibility to fulfill that hope.
As President of the United States, I can state
on behalf of the government and the American
people that we will do our best to do so.

John F. Kennedy

Soviet Leaders to President Kennedy

Decembeb 29, 1961

President .Ioiin F. Kennedy
Preaident of the United States
White House
Washington, D.C.

Dear Mb. Pkesitient : In these few last hours of the
expiring 1961 we are sending to the people of the United
States the sincerest wishes for peace and happiness in
the New Year and lilcewise our best wishes of personal
happiness to you and to your entire family. Right now
on the doorstep of the New Tear the nations live with
new hope that the coming year will be such a threshold
in the development of events when there will be uiuler-
talcen eflicient steps in the cause of liquidation of cen-
ters of military danger. There is no doubt that on the
state of affairs in Soviet-American relations depends
very much whether humanity will go towards peace or
war. At the meeting in Vienna the President of the
United States and Chairman of Ministers of the U.S.S.R.
agreed that history imposed a great responsibility on our


peoples for the destinies of the world.' The Soviet peo-
ple regard the future optimistically. They express hopes
that in the coming year our countries will be able to
find ways towards closer cooperation, will be able to find
a basis for concerted actions and efforts for the good
of all humanity.

On the part of the Soviet Union, as before, there will
be no lack of resolution to do everything in its power
in order to ensure durable and lasting peace on our

N. Khrushchev
L. Brezhnev
Kremlin, Moscow

Secretary Rusl( Interviewed
by NBC News

Following is the transcript of an interview with
Secretary Bti~sk hy EUe Abel of NBC News, por-
tions of which were broadcast on the NBC-TV
network program "/. F. K. Report-'' on January

Press release 27 dated January 12

Q. Mr. Secretary, when President Kennedy took
office about a year ago, there xoas a great wave of
hope around the world and in this country — hope
for new ideas, neio initiatives, neio solutions to
some of the old problems. So many of them are
still with us: Berlin, Laos, nuclear testing, arms
control. I grant you the style of American
foreign policy has changed, but how about the
substance? Hovj has that changed?

A. I think if we rememlier President Kennedy's
inaugural last year, he called attention to the fact
that we are in a turbulent world situation, and in
any given year, in a situation of that sort, things
are likely to be a little mixed. But there are many
reasons for encouragement and confidence as we
move into 1962.

For example, in the North Atlantic community
there are far-reaching negotiations now going on
to expand and strengtlien the European Common
Market. In the OECD [Organization for Eco-
nomic Cooperation and Development], of which
we're a member, the governments there liave deter-
mined to set as their goal a r)0-percent increase in
overall gross national product over the next 10
years and to adjust their public policies — their
economic and fiscal policies — to the concept of

' Bulletin of June 26, 1961, p. 991.

Department of State Bulletin

growth.^ In the Development Assistance Group
of tlie North Atlantic community the member gov-
ernments are moving toward a commitment of 1
percent of their gross national product toward
helping the underdeveloped countries get on with
that job. In the militaiy field the Atlantic com-
munity — NATO — is stronger than it has been in
many years. There's much to be done still, but
that strength is making itself felt. I think that
we can take a great encouragement from the vital-
ity and liveliness of this great community. Now,
indeed, some of the so-called disagreements that
trickle out of these discussions with our NATO
allies themselves reflect the vigor of the discussion
that is going on. We no longer are talking about
just those questions in which we know in advance
we already agree. It is a vigorous forum of dis-
cussion of far-reaching political issues that stretch
right around the world.

In the Latin American scene the Alliance for
Progress has given new impetus to economic and
social development. We were able to be helpful
in setting the Dominican Republic on a great step
toward democratic institutions,^ after some 30
years or more of dictatorship and against a back-
ground of violence and hatred and suspicion in
that country. I think it's fair to say that the
hemisphere is becoming increasingly aware of the
dangers of the penetration of this hemisphere by
communism, as reflected in the Cuban situation.^
We'll be meeting in Punta del Este on the 22d of
this month to consult with the foreign ministers
of other hemisphere countries on that particular

On some of the critically dangerous problems
such as Berlin and Southeast Asia, our object there
has been to protect the vital interests of this coun-
try and have the free world without war if pos-
sible. Now, those problems haven't disappeared.
But on the other side, our vital interests are in-
tact, and we still have peace, as far as tliis country
is concerned. But there's much to be done on
those issues.

I think in the last week or 10 days there's been
a considerable improvement in the Congo situa-
tion. There are signs that Mr. [Moise] Tshombe

' For background, see Bulletin of Dec. 18, 1961, p. 1014.

^ For a statement by President Kennedy and an an-
nouncement of the resumption of diplomatic relations
with the Dominican Republic, see ibid., Jan. 22, 1962,
pp. 128 and 129.

" For background, see ibid., p. 129.

and Mr. [Cyrille] Adoula are reaching out toward
a negotiated agreement with respect to constitu-
tional arrangements in that country, and we are
encouraged by that.'' I tliink there are many
reasons for confidence, but the agenda of the
United States still remains a very full one.

May I conclude this remark by pointing out
something about the United States which is unique
in this foreign policy field — where no other gov-
ernment has quite the same problem that we have.
And that is that influence on American foreign
policy is a prunary objective of every other foreign
office in the world. Wlierever a dispute arises,
whether it's in Kashmir, or in West New Guinea,
or wherever it might be, we are drawn in because
the parties to these disputes hope to enlist our
aid and sympathy and interest, sometimes on their
own side of the dispute but also in terms of help
in settling them.

Q. What makes it tricky, of course., Mr. Secre-
tary, is that so often iotk of the disputants are
friends of ours.

A. Yes, and many of these disputes are over
questions which have no direct national interest
to us — over issues wliich we did not invent, where
our primary interest is that friends of ours settle
their disputes between them on a friendly basis.
But we are drawn into them. And, of course,
this gives us a very full agenda throughout the

Q. Mr. Secretary, Pd like to ask a question that
I think is on the minds of a great many Ameri-
cans — following Cuba, Laos, and Berlin. It has
to do with whether President Kennedy, in your
view, understands the uses of national fower in
support of national goals. There has ieen some
doubt raised in this area. The question I wanted
to ash you is — are you, yourself — what is your
testimony? You watched this man close up deal-
ing with issues that — in which the balance between
war and peace was very narrow. Are you, your-
self, satisfied on this score?

A. I think that the American people can be
fully confident that President Kennedy under-
stands not only the burdens and responsibilities
and the necessities of power but also the limita-
tions on power. In a situation such as Berlin,
where the most immediate and direct vital inter-

' For texts of Department statements, see ihid., Jan. 8,
1962, p. 49, and Jan. 15, 1962, p. 95.

January 29, 7962


ests of the United States are involved, there is,
of course, a need to be absolutely determined to
protect that position. And that has been made
clear by the President, not only to the free world
but to others. I think that it is too easy to think
that every problem could be solved if we were
ready at a moment's notice simply to inject Amer-
ican troops into a particular situation.

Q. Yes.

A. That is not (he way to peace. It's not the
way to an orderly world. Nor do I believe that
the American people ought somehow to be trans-
formed into gendarmes for every dispute in any
part of the world — if there's an opportunity to
bring about a peaceful settlement which is con-
sistent not only with our national interests but
with the peace of the world.

The Threat Posed by Cuba

Q. Mr. Secretary, in his speech ' before the
American Society of Newspaper Editors last
April, at the height of the Cuban affair, President
Kennedy said: "T7e intend to profit from this les-
son. We intend to reexamine . . . our forces of
all kinds — our tactics and other institutions here
in this C07n7minity. We intend to intensify our
efforts for a struggle in many ways more difficult
than war. . . ." Can you tell us, sir, looking
back on it now, what lessons this administratio?i
learned from Cuba and how this reexamination
of forces and tactics has gorve?

A. I think one thing that we should remember
is that the struggle for freedom, which has been
going on for centuries, is not determined by one
or two or a third episode. These brave Cubans
who undertook to liberate their own country
failed in that particular effort. But the story of
freedom is a long one, and that story has not come
to its final conclusion. I think that we, at the
present time, are working closely with the other
members of the Organization of American
States — the other governments in this hemi-
sphere — on the basis that the threat posed by Cuba
and the penetration of this hemi.spliore bj' com-
munism is more directly and immediately a threat
to the rest of them than it is to the United States.
Their awareness of the nature of this threat has
been growing very rapidly. And that is the next

• Ihiii., May 8, 1961, p. 059.

chapter, I think, in this problem here in this

Q. But has there been a change, Mr. Secretary,
of the kind that the President ivas talking about
in that speech — mi the sort of internal procedures
of the American Government — to make sure that
a disaster like Cuba will not happen again?

A. We've had a reorganization and some ad-
justment in our procedures. But I would not
think that that would be the more fundamental
aspect of that problem.

The Berlin Wall

Q. Some Americans have argued, Mr. Secre-
tary, that we should have torn down that loall in
Berlin brick by brick — or better still, that we
should have pushed it aside when it was still
barbed loire instead of brick. Was that idea ever
considered in mid-August of last year? And if
so, xuhy did the President decide not to go ahead
and do it?

A. When a question of this sort— a situation
of this sort — comes up, I think it's reasonable to
assume that all contingencies are considered and

Online LibraryUnited States. Dept. of State. Office of Public CoDepartment of State bulletin (Volume v. 46, Jan- Mar 1962) → online text (page 36 of 101)