Nixon, Jackson & Friedman on Middle East and Energy Policy

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Oh, thank you.

Hi, how are you?

Oh, it's very good to see you.

How did you do?

I had a great time.

Yeah, it was very interesting.

I really enjoyed your speech.

It was fascinating.

Yeah, well, we divided this into two parts.

I was down in the Middle East, and I was doing that.

Mrs. Meyer, and I gave her a call, you know, give her your best.

She's quite a gal, put it mildly.

And she's tough, you know, and yet she's very patient.

She's going to run again.

I like her much better.

Oh, Mrs. Meyer.

They're the super-righteous types.

The end of them drive me right up.

The ninth of all myths.

God and everything that is.

We're a bunch of, you know, we just show everybody.

I never forget the dinner at the gate.

We were just here just before they frankly invaded East Pakistan, and they damn well did.

They were responsible for it.

I paid her a very high tribute.

She was a great personality.

We also sat there and did so on her.

She got up and made the most of it.

i mean totally you and i agree on the percent biggest pony

Plain phony.

Well, anyway, I had a good chat with the Shaw.

Of course, I conveyed your best wishes to him.

He is, you know, completely pro-Western, of course.

God knows what happens when the Shaw goes.

I think that place has got more trouble inside as president than Shaw lets on.

Well, the Shaw keeps talking.

home than the Iraqis with the Russians in it.

And the urban guerrillas being financed, you know, by the Russians.

But my scuttlebutt is that there's just a lot of work that needs to be done in the country.

He's done quite a bit.

Yeah.

I think he's spending more on defense than he needs to.

And, of course, this worries the Saudis and so on.

and uh he might play a great power role there which is really not hateful yes sir he feels uh he has a german program of 800 million dollars for helicopters he's bought three concords he's a fly boy and he wants to fly he's gonna put helicopters on destroyers and it's kind of comical in many ways but anyway what i want to make a comment or two on this

I think a day and a half with the Saudis, that's a bad situation.

They're all for us, but that area's right for a coup.

Something's going to, frankly, happen.

Would you do me a favor, John?

Well, that's all right.

I'll just...

If you have tea, I'll...

I prefer tea.

Tea and sugar, that's all.

I don't know...

Right.

Just tell them to buy a lot of air, and Conley can lay an income.

So you do it.

Tell John that you and I were talking, that I asked you to call.

Right.

To give you your options.

Now you tell me.

Well, let me just, as I mentioned, we're in the middle, as you know, not in the middle, but we're... Let me tell you a word about the energy thing.

I know you're talking about it.

Yeah, I had lunch this morning.

We have taken...

and scoop the whole energy thing.

You see everybody's fighting over in the government.

The Interior Department naturally want to handle it.

The Commerce Department want to handle it, the breweries.

The Atomic Energy Commission thought they were the people who do it.

The Defense Department has a hell of an image in it.

The State Department, of course, because of the inter-NASA law and so on and so on.

I finally decided that the energy, the whole energy, because it cut across so much of government.

This is one of the few that were cutting the White House staff way down.

This is one thing, which had to be, had to be handled with an ad hoc, directly from the White House to keep all these war people

so that it doesn't become a policy which is too much for too much for conversion of you know all right

That, for example, would involve East-West relations, you know, this huge deal with the Russians.

That's involved in this thing.

It's a real deal that the energy people might be all for it, and the oil people might be all for it, but we may want to grab our feet a bit about that because of the foreign policy.

So I would like to, I want to tell you that at this point, part of my discussion here, I know you're interested in it.

I saw some of your observations directly to Erdogan.

on the organizational end of it because we will have it in place perhaps in a matter of two or three weeks

has, I would say, he's a good back guy.

You see, we need a creative guy who is not thinking just of one part of it.

We've got to send him a whole man business.

We've got to send him a very complex guy.

and those they carry out there.

If you would have a talk with John.

No, I will.

I would like to address on your thoughts on the energy thing before we get it in place.

All right.

So I'm not going to throw it out here because I can't because of that one of the departments.

There's not one that I'm aware of.

But you've got 64 agencies in it.

Well, yeah, I'm really worried about that.

I'm worried about the Persian Gulf.

See, what the Russians have done is really moved over to Iraq.

Now, Iraq has the second largest oil reserves in the world, which surprised me.

Those are the classified figures.

This is classified.

The Saudis, the published figures are 150 billion barrels reserved.

Ours is 40 in the United States.

The true figure is 300 billion barrels.

300 billion.

They've got more oil than all the world together, Mr. President.

Who do you mean?

The Saudis.

The Saudis and this Department of Health States?

Yes, sir.

300 billion barrels of oil.

They have more oil than the rest put together.

But there are only five million Saudis, and over two and a half million are nomads.

So they can only account for a couple million.

But what I'm trying to say is, I guess, that as I see this picture up there,

The whole Persian Gulf area is right, because in the Persian Gulf, you've got it.

I mean, the oil of the world.

And the Russians are moving now, not to put a communist government as I see it, but they are moving to influence the economics, you see, so that they can shut the spigot off.

And if they shut the spigot off, they can really raise hell.

Now, one thing— It's all the air we can eat, so let's face it.

The Russians are getting much more intelligent this way.

That's right.

Exactly.

They want to influence the situation in Western Europe, Japan, to be able to, you know, put the shoes on.

Now, one recommendation that I would make is that, I don't know, you know, it's an impossible task, but I think a

The State Department ought to make the maximum effort to try to frame, and it's hard, the Shah and the Saudis together.

They're the key.

All right, I'll tell him.

This is the key.

The Shah hates the Saudis, and the Saudis...

It's racial.

It's ethnic.

You know, the Iranians are proud of 2,500 years.

The Arabs, it's an ethnic thing.

Now, I think we have to get some kind of a cooperative arrangement in the Gulf because Kuwait, in my judgment, which is a sitting duck, over half the people there are non-Kuwaitis.

And

the Saudis are sitting ducks.

And I'm afraid of some kind of a coup.

They've tempted one, you know, before, but with all this film in front of it.

Let me give you a figure.

By 1980, the take, the annual take of the Saudis will be over $20 billion a year.

And in the Gulf, it will run $60 billion a year, just in revenues.

And our balance of payments deficit by 1980 will be between $17 and $20 billion.

You know, I don't want to... What was that?

I just want to, you know, mention one word on energy, and then I'll mention a word about Central Europe.

Before you leave that, let me say one other thing.

We have to face it.

I have supported the Israeli position that the Israeli-Arab conflict is one that causes the very vitals of any viable policy we can have in that area, and that at some time,

we have got to some way uh work something out now what the hell we can do i don't know fortunately the shah is the most i guess he still is he's the most understanding of the israeli position he is crying these are absolutely nuts oh well but you know you know this is a problem you know because he has algerians and crazy algerians and needless to say

The Algerians, the Syrians, the whole rest are out there.

They surround us.

Here's Israel in the middle.

I know.

Well, the Saudis are not bad.

They're very good.

Yeah.

And they...

He's agreed to take Iran.

Oh, he's agreed to do that one?

He's agreed to do Iran.

I have another idea for another assignment for him.

He's a good man.

He's a very old guy.

Very old guy, but he's got something for you.

Yeah.

But I think that Dick, with his experience and the rest of it, will be a hell of an asset in that area of business.

And he could be very good through that whole Gulf area.

I was thinking that he could kind of give him some daughter.

I'd love for you to have a talk with him.

With Dick?

Yes, sir.

I think it's a hell of a good thing for him.

It's a great challenge for him.

Mr. President, ask...

Mr. Akins, who's over here with Flanagan, to give you those.

I'd like for you to have those classified figures.

Akins, A-I-K-E-N.

Yes, A-I-K-E-N.

He's with Flanagan, working with Flanagan.

I think you'd be, you know, I was shocked by these classified figures.

They're just devastating.

Well, a word on, let me just throw out to you a few quick basic points on the

on what I think there ought to be on the energy.

Let's assume we work out the organization.

I think we have to posture ourselves in such a way that we don't allow the Arabs to just, you know, shove the price way onto the road.

And they're going to keep it in the ground.

They told me very candidly, and the Shah is in this way, but the Saudis will just keep it in the ground.

So why the hell should we turn around?

What better investment is there to keep the oil in the ground?

There are about six things, I think, that need

to be done on a very large basis, which will help to influence the situation.

Because they do respect American science and technology.

I'm talking now about a very large R&D effort in the fall.

Gasification of coal.

We've got a trillion tons of coal.

Liquefaction.

Reduce it to petroleum.

Now, this is all R&D.

Oil shale.

This thing has been kicking around.

We've got a

trillion barrels.

You know that.

It's all screwed up.

Yeah, part of it.

Yeah, well, we've all, the truth is that the oil companies have lagged on all this stuff.

They're just, they're living in a dream world.

I know, I know.

That's right.

they're going to be national now they're running they're running big uh big ads about you know energy and all this and then the other thing but they better get off their butts they've been dragging their asses right here third thing is geothermal energy-wise and uh fourth is nuclear power uh fifth are incentives this is an old old fight to step up drilling and sixth is canada

jesus canada's sitting up there they got these huge gas reserves and that gets into the lng thing i think you ought to go real slow on that lng business uh from russia and from i know russians don't have anything else really to sell and uh i know what the game is but you know imagine with the dependence we had see we're getting 27 of our oil now abroad 1980 it'll be uh

It'll be 50% by 1980 that we'll be bringing into the country.

And then if we're going to get our natural gas from Algeria, it's actually about as defendable as yesterday, and if the Russians are going to be a source, it seems to be a mistake.

But those are six quick little points that I would make on that.

One quick word about, we were in, we met with Tito and all the heads of state in Yugoslavia, Bulgaria, Romania, and Czechoslovakia

Tito has got real ethnic problems.

He's struggling with, he's a Croat.

He's got the Serbs and the Slovenes, you know, and they decentralize.

Well, they're getting tight control.

No one knows.

Everyone, you know, asks what happened when Tito goes.

Tito, you know, he's eight years of age, and God, he's tougher now, and he's 70.

Yeah, and he's very friendly to you, and God, at 10 o'clock in the morning, he was

pwned down the brandy anyway he says look at me I'm healthy don't worry about succession you know immortal but there's a I think a real I asked him about Brezhnev and the Brezhnev doctrine he says Brezhnev is flexible he wouldn't answer the question that's right he's scared to death and the moment the Russians are going to play that orchestrate that thing Tito dies there's

no real leadership are taken, they're going to move.

In my judgment, I may be wrong.

He, impliedly, is aware of it.

The Bulgarians are more Russian than the Russians.

I never, never noticed that.

Oh, it's just, just, uh... Hello.

Yeah.

Well, actually, who this is, is the, uh, you might ask us.

You see, check out that card.

It's supposed to show us a bit of information at the end of all.

This is Milton Friedman.

He used to have an early heart surgery.

The mail is one that you can reread.

Play that on Thursday at 507-282-2581.

Oh, it is a professional.

Yeah, it's a professor.

I'm trying to talk to him, but he's called a doctor.

Okay, he's not a doctor.

He's a professor.

Okay.

And he's a... Well, to sum up, the three countries, or the four countries, exclude Czechoslovakia.

They really don't have anything to sell us as president.

No, no, no.

Except Czechoslovakia.

Yeah, some things...

The Russians have got all that.

My advice would be two things.

One, I would make a real effort to provide technical assistance, exchanges.

I'd do it with the Bulgarians.

I'd do it with the Czechs.

They want doctors.

And have them come over here.

I think this is, you know...

say, look, what the hell, you need managerial help.

That's what they need.

They need managerial help.

Their enterprises are just in a mess in all of those countries.

I would, I wouldn't put it quite this way, but I would give special consideration to the Romanians.

And spent two hours with Charles Chesky.

Oh, yeah.

And he runs that country, you know, it's more communist than Russia, internally.

But, of course, there again, he is basically very friendly to us.

He's friendly to us, and I think there's a relationship, too.

Right.

I think there ought to be a few extra goodies to him so that the others learn by example.

The Bulgarians are hopeless.

I mean, as I say, they're more Russian than the Russians.

They're Slavs.

You can't do a damn thing with them.

The Czechs, I think we can do something with.

People, and likewise with Romet, they really need technical help.

And the interesting thing is that they all agreed on one point, that we lead the world in science and technology and economic output.

And they're in this, and they want help.

And I think it's people.

I wouldn't get bogged down in a big, you know, phony, because it is phony.

They don't have anything really to say.

people will help us more ideologically too because they want to see the United States and the more the old old story the more the freedom the better one last thing uh of course is our our situation on the on defense and arms control I just like to make a couple of general comments I would like to see uh

I hope this Richardson thing will work out.

What I'm worried about is that Elliot is going to bring in Jonathan Moore.

And I'm on the Institute of Politics, Kennedy School of Government.

And it's Jonathan Moore who's one of the fellows up there.

He's bad news.

And it's that Jerry Wiesner syndrome.

It's like Bill Miller that got in with Cooper.

Uh, I'm gonna see, uh, uh, Elliot tomorrow.

He wants to talk to me.

And, uh, I'm gonna be very blunt with him, you know, because, uh, Elliot is, uh, is just... You see, Jonathan Moore and the other fellow we had that was with one of our bright guys here... Yeah.

...who left here to go to Cambodia.

Yeah.

And, uh, and, uh, frankly, uh, I have told him, I, you know, quite frankly, I absolutely don't know him.

Spunky could find them over there at ADW where they're supposed to be self-headed.

But the hell with it in defense.

I'm not going to ask... Well, but they're not loyal.

They're not loyal.

They're not supporting our policy on the Capitol.

They're not loyal to you, Mr. President.

Well, they're not loyal to me, and basically, they just, and they will not take the line.

Now, Elliot is not a soft man.

Elliot himself does come from that community, unfortunately, and he, he, he doesn't, but, but he, but, but we've got to be sure that he isn't surrounded by people.

That's what I worry about cutting the hell out of us.

And we've got your, uh,

but i would talk quite candidly with him now the uh the second fall is uh will be strong yeah well john tower uh came by the office and talked to him and i'm going to meet with clements and i'll talk to you talk to clements in very frank terms and so forth now let me see he has some ideas which are very very good about uh we've got to shake up defense like everything else there are no sacred cows around here

uh uh

and really believe beginning by one point.

Yeah, that's because when the chips are down, they preserve them.

That's right.

They'll cut their throat.

All the other crises.

Suppose, for example, we get to a hell of a crisis over salt.

That's right.

We may have one.

And now, there, your Secretary of Defense has got to be on your side and on the side of the hard line rather than the soft line, see?

Because the state guy will be on the soft line.

And there, fortunately, you see that we have no problem there.

Blair did a good job.

Blair killed it to the right.

Blair killed it to the left.

Sure, sure.

But you see, Elio, he's a very intelligent man.

Oh, he's certainly bright.

All foreign policy has been...

Once he got the word, told him, well, now the point is that he'll be a good manager, all the rest of it.

But we put Clements in through, not for the purpose of watching, basically there'll be a balance, but Clements is a hardliner, and that's good.

The only thing I worry about is that Elliott brings in a lot of these soft carry guys, and subconsciously they'll influence him.

We've all watched that in the arms control.

That's the only thing I worry about.

You've given all your names that we're working on.

Yeah.

What's going to happen?

Well, those guys are...

I talked to Al Hayden before he came here.

Today?

Yeah, just now, and gave him a little rundown.

One thing...

Yeah, but you can cut that staff down.

Just get a first-rate guy in there running it.

Bill Rogers called me about Alec Johnson as a chief negotiator.

I get it.

I think Alec's fine.

He's not...

He's an operator who'll carry out instructions.

He'll carry out instructions.

And we found this.

Alex didn't agree with Amboy and he didn't agree with May, but he carried it out.

Yeah.

He's loyal.

He's a loyal man.

He's honest and he's rare.

You know, rare.

That's why he's a fine foreign service officer.

But on actives, let me tell you,

After our talk the other day, I stirred the pot on that.

We are working, we're separating two jobs.

But I want somebody in charge of acting to go cut the hell out of that span.

That's a poison or something.

That's right.

They just, they're some bad guys.

We've got all the names, and we won't, we don't need to worry about it now.

But they're disloyal.

What my point is is that they're disloyal to you.

They're part of this syndrome, you know, that really they're, Governor Knight's the whole guy.

Oh, oh, yeah.

Governor Knight, Wiesner.

Sure.

And they've got a tie-in, and the moment you send something over to them, they have it up at MIT, and that whole crowd of...

American Association of Scientists, Federation of Scientists, and that whole crew.

Well, I talked to Al Haig, too, about Ed Rowney, and he's the general, yeah.

He's the, you know, the genius, and I swear to God.

Now, just frankly, Henry indicated to me that he, Abraham, didn't like him much, but I want you to know about that.

Who's Abraham?

Abrams, the chief of staff in the Army.

All right, I'll get that.

Abrams, very, you know, he is not, Ed Brown, he's a Ph.D.

He got his access.

Abrams is a good field commander.

That's right, that's right.

But this job ought to be elevated to a four-star spot with a staff backup as president.

So...

I'm talking about being on the delegation taking... That's right.

But that ought to be... That ought to be upgraded.

For sure, that's done.

That ought to be upgraded to a four-star spot.

Oh.

But ask Haig.

Haig says he is the brightest man in the Army.

Let me just give you a quick.

He got his B.S.

from John Topshin at 19.

He graduated from the academy right after that with his B.S.

degree.

He got a double master's from Yale, one in engineering, one in political science, and he has his Ph.D. in public administration.

He's a three-star general.

He's 55.

And he ought to be a four-star.

But he's just too smart for the damn people.

That's right, and they don't take him.

one last thing ken blue now john stennis and on the field that uh ken blue he's under secretary but you need you're going you know we're going to have a worse fight in the senate than we did before because we've had a net national security loss in it in the senate i'm afraid you can't uh well the democrats that came in are all none of them uh well uh they

maybe yeah some of the southerners all right but these the others are going to be bad and i'm afraid and you better add me i don't half the way will follow uh musty so there's four that's right

And then it's offset by...

It's offset, of course.

Of course, you'll have improvement.

I don't know how long you'll have a...

It'll be over... You'll have improvements, actually, in Kentucky.

Oh, we have a...Huddleston is a plus.

He'll be better than John Turner.

That's right.

You'll obviously...you'll have a stronger... Scott will be for the right.

Yeah.

But you won't have any trouble out of Georgia, North Carolina.

Helms is very far right.

One other last thing.

Yeah, go ahead.

I just learned from George Shultz that you were going up to Mayo for an operation.

And I wanted to know, we just wish you the best.

And I said, what are they operating on?

I said, you're operating on this heart.

He says, fine, that's okay.

I said, just don't operate on your brain.

So, because we need you.

And, well, I'll tell you, I know these things that must be quite an experience to go through, but they tell me they're the best in the world up there and that, uh,

And also, you're a very tough fellow, you know.

I am.

Right.

And I just wish you the very best, and we'll be expecting to see you back with a good heart in the same brain.

Okay.

Well, that was very kind of you.

Good to talk to you.

Bye.

as a constructive suggestion I would utilize John Sherman Cooper in some capacity maybe ambassador at large as a bridge to the fuzzy wuzzy world he would be good on NATO no Bill Miller Bill Miller is his you know the guy but John is excellent on troops for Europe NATO but you could

give him a title of ambassador at large, and use him with the funsies.

Now, John is loyal.

He's a funny guy.

Oh, I know.

I know.

He's a wonderful man.

John has become, made a few years of becoming a guru.

I know what it is.

John is a wonderful man.

But he'd be loyal if you'd give him the instruction.

I think he could help you.

You know, John can talk to the Fuzzies on our side, and on the Republican side, we've got him on both sides.

He's good for three or four votes in a crunch.

He is.

Yeah.

I mean, I'm suggesting this as an assist to you, because, you know, I've had my bitterest fights with John over the ADM, and I fought him, you know, he fought me on my amendment on the Paris rule, so, but, uh,

That Bill Miller, like, he's a, he's no good.

I don't know him, but I don't like that advice.

You've got to shock him, you know, and give him a business.

You know something, I wonder if it's that really the problem with too many of our friends in the Senate.

The damn stats are too big.

And they've got staff members on there that are, frankly, got more time to study the issues than they are, and they just leave these people.

They're just weak.

They just turn it over to their staff, and the staffs are being influenced by some very bad groups.

It's a console for a little bit of the world.

I know the whole... You know yourself having served in the Senate in any position.

that you have to rely on staff.

I mean, you know how that person who gets in there, your administrative assistant, or your legislators, and now they've got so damn many, they've got bigger staffs, but they'll get in there and they'll talk to you, and they'll see what mail comes to your attention, and they'll see what calls come to your attention, you know what I mean?

That's right.

That is a hell of an effect on the Senator.

And the real, the bad guys are logging these sentries, you see that?

Yeah.

That's sufficient.

Well, I just want to help you, because I think we've got a real...

uh battle in the senate uh obviously as i told you four years ago they were going to you know give you any uh leeway and i uh i noticed teddy kennedy's a little friendlier but uh that's massive no no i they're gonna be uh petty and vicious and uh all that stuff

these days, all the presidential stuff starts so early.

But I want to help you on all that as best we can.

But think about Ken Blue.

I don't know what's going to happen on that secretaryship over there, but I think you'll make Stennis very happy.

Stennis, I mean, Blue can help you on a hill.

I think that he won't

uh, guy who's worked with the Democrats previously.

Ken has never had any political affiliation.

No.

He, uh, is, you know, he was...

He's sort of Harlow's great friend, but that's not all.

Yeah, Ken, Ken, uh, was regular Army, and he got retired.

You know, he had his, uh, foot shot off in, uh, in Korea.

And, uh, he came up, uh...

He's a real nice guy.

Yeah, he's a real nice guy, and he is loyal, and he knows the Army.

He was a full colonel in the Army.

Okay.

And he has good contacts on the Hill, and he can be damn helpful.

God knows the Defense Department can meet him.

And I would strongly recommend you seriously consider him.

And I think Al Haig feels that way, too.

He knows it.

And, of course, Hokey is there.

If there is to be a change, I think Ken will be loyal to you.

That's all I want to say.

I have no time for these guys that...

Well, you know, they really should be watching.

It's just sort of a strange thing that has developed these days, that the people that really are supposed to get ahead are those that go ahead and chop the man down.

You know, there's a little boy, I think there's going to be a hell of a lot less of him this time and later.

But really, it's from the Iliad or the Odyssey, he pulled a beam on the gates that tells you that one thing is far better than another.

And there's a lot of these sons, one thing...

Hateful to me, even under the gates of hell, is he that hideth one thing in his heart and uttereth another.

That's Rod of the Iliad, my little classic, and it's a good one.

Hateful to me, even under the gates of hell, is he that hideth one thing in his heart and uttereth another.

And then there's just too many of them.

And the story of the, you know, the act of some of these other... Oh, I know what they did to him.

I'll get in touch with John Conway and also with... What's his name?

John Conway.

And John Conway.

And, yeah, that.

I mean, I know her.

You want to keep in touch with Al Haney and Henry or... That was the best.

He's terrific, by the way.

I hate to lose him.

I really do.

Well, you ought to have him in that house.

Thank you very much.

Nixon, Jackson & Friedman on Middle East and Energy Policy

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