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Senate it will not pass the House. If the Senate passes it, arrangements have been made for the conference report to drop it. Secondly, special arrangements have been made to seek passage this week. I haven't mentioned this to the Foreign Minister yet, but I hope he will be able to participate in the ceremony solemnly depositing the instrument of ratification.

Regarding the expenditures, we leave it to your Ambassador to explain to you the personality of our Secretary of Defense. Requests for funds are those already made, but he is justifying them by the SALT agreement. To explain that is a boring domestic issue and this did not require a presidential decision.

Regarding our meetings here, you have been courteous and the meetings have been most productive. We expect at the end of October to conclude a trade agreement including most favored nation status, the extension of export-import credits and also expect the announcement of the beginning of SALT and the preparatory meeting of CES and the exploratory meeting on force reductions. So we can say our relations have had an enormous impetus and have been given concreteness by what we have agreed here. Let me thank you for your courtesies, hospitality and the enormous comforts we have enjoyed during our stay and, as I said yesterday, we are now not only developing relations between our two countries but also very strong personal bonds and I look forward to a very early return to your country.

Mr. Gromyko: And to Leningrad.
Dr. Kissinger: To Leningrad and to see Giselle.

[During the course of translation of Mr. Brezhnev's remarks above the following additional exchange occurred:)

Dr. Kissinger (to the interpreter): You might point out that if you are speaking about the Minister of Defense-on a personal basis—that he will not be long with us, so that situation will change.

Mr. Brezhnev: The absolute figures have increased.

Dr. Kissinger: By about 50 million. There are two things, he submitted a budget in January and then increased it in April and then there was a small increase in June. He justified the April increase with the May treaty. It is a bit strange.

Mr. Brezhnev: So long as the situation doesn't arise where our military people don't start that way before we're back in the old arms race.

Dr. Kissinger: Some Senator told me as a joke that he didn't know how many SALT agreements we could afford before going bankrupt. Also, we have agreed that our new Defense Minister could come here in the new Administration and we would reciprocate; or your Defense Minister could come here first if you wish.

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Mr. Brezhnev: Yes, but we haven't addressed that question yet.

We promise you that. (Referring to Dr. Kissinger's seeing Giselle on his next trip.) And please don't forget to give President Nixon my very best wishes.

Dr. Kissinger: I certainly will.

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The View from the Kremlin Three Months after the Summit

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Without question, the Soviet leadership, and Brezhnev in particular, has not had the best of summers. The crucial questions are how the leadership will respond to problems in key policy areas—both domestic and foreign—and especially how Brezhnev will react if he feels his own position is threatened.

The leadership probably sees little choice but to conduct itself in the measured manner it has adopted when faced with similar problems in the recent past. In foreign policy setbacks such as the ouster from Egypt and in domestic reversals, such as the poor agricultural situation, we expect the Soviet leaders to fight to limit their losses, to attempt to consolidate and play up their "victories” and to avoid the dramatic.

The leadership situation is not likely to alter very much in the immediate future. Brezhnev is more answerable than before for policy failures because of his forward position within the leadership, but our knowledge of how much pressure he is under as a result of current problems is extremely limited. With the power he has acquired, he is better equipped to stave off any challenges. Looking some months ahead, he could find himself under growing pressure if adversity should multiply in foreign and domestic affairs. The vagaries of international affairs and the final reckoning of this year's harvest are unknowns that will influence the political situation in Moscow. The first indication of pressure building against Brezhnev would probably be a

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Source: Central Intelligence Agency, Job 03-02194R, Box 1, Folder 37. Secret; Codeword; No Foreign Dissem. This memorandum was prepared by the Office of Current Intelligence and was coordinated with the Office Economic Research. The Office of National Estimates agrees in general with its findings.

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reappearance in public forums of veiled polemics against his policies. We have not seen this yet.

If Brezhnev should feel his position threatened, some policy adjustments might be required. It is commonly, and probably reasonably, assumed that if Brezhnev is threatened politically, the threat would come from the “left," i.e., from those who say he puts too much trust in the capitalist enemy and not enough in his socialist brethren. The usual manner of coping with such a threat is to move toward the position of the opponents, cutting at least some of the ground from under them. Brezhnev might follow this course a short distance, particularly in rhetorical terms, but he is more likely to defend himself by hardening his position on internal rather than on external affairs. His position is strong enough and his commitment to his policies (particularly on major East-West matters) deep enough for him to seek compensating successes, or at least deals that can be made to look like compensating successes. These he could present to his colleagues on the Politburo and in the party as justification for his continued leadership. Relations with the US

The Soviets evidently believe that the prospects for improved relations with the US are better now than they have been for quite some time. They have said this publicly, even though they have been careful to balance expressions of optimism with statements of continued concern over the uncertainties in the relationship. A prominent Soviet commentator recently summed up what appears to be the current official view. The situation established since the Moscow summit is “quite delicate," he said, and so the seeds of trust and mutual understanding that were planted last May must be carefully cultivated."

Nowhere have the Soviets made greater efforts to promote an atmosphere of accord than in the area of direct bilateral relations. They have maintained, and, in some instances intensified, highly visible contacts with US officials; they continue to point up the new opportunities for expanded trade and other economic dealings; they have been at least circumspect and often cordial in their public treatment of the President and have assessed his prospects for re-election as high; and at times they have muted criticism of US policy at the expense of their clients.

Moscow continues to insist that the USSR be recognized as an equal and treated accordingly. The Soviets have stressed this as one of the major benefits of the summit and of their general policy of pursuing better relations with the US. Any action by the US that leads Moscow to think the US is slipping away from equality is a cause for concern. Moscow's concern has been particularly manifest in recent comments on efforts in the Senate to qualify the SALT agreements.

Apart from emergency imports of US grain necessitated by a serious shortfall in the harvest, the USSR has reason to be pleased with the immediate state of US-Soviet economic relations. The Soviet leadership is doubtless unhappy about the huge trade deficit-possibly as much as a billion dollars—that the USSR will run in 1972 and 1973 as a result of the grain purchases. On the other hand, the Russians have placed orders that should result in imports of much-needed US machinery and equipment worth about $150–200 million in 1972.

The most immediate problem for the Soviets is their grain supply. Because of poor weather this year, the 1972 grain crop will fall far short of requirements. As a result, US exports of grain and soybeans should

a reach $650–700 million in 1972, the exact amount depending on actual shipping dates. Moreover, the delayed ripening of grain in the crucial Virgin Lands of Siberia and Kazakhstan could cause above-normal harvest losses during the coming weeks and generate a need for further imports. Below-average prospects for potatoes and fodder cropsgrain substitutes—make the grain deficit particularly painful for the leadership. The Soviets will not know the full extent of their grain requirements until mid-October, after the harvest.

The Soviet leadership almost certainly realizes that its grain problem is not the result solely of one poor weather year. To support the Brezhnev meat program, substantial imports of grain may be necessary even in normal weather years. There is evidence that the USSR is trying to signal the US and Canada to expand their grain acreage so as to ensure a source of Soviet imports in the future at favorable prices. This implies that the USSR recognizes it may be in the market for significant quantities of US grain in the future.

Negotiations for a comprehensive US-Soviet trade agreement are still stalled, despite the upsurge in US-Soviet trade in 1972 and a continued high level promised for 1973. There is no indication as yet that the Russians are willing to make significant concessions in order to complete a trade agreement. Lack of settlement of these issues does not affect trade prospects. Export controls have become only a minor issue, because most of the needed automotive, petroleum, and consumer goods equipment is available. In addition, US business is proving eager to deal with the USSR, and the Soviets are fanning this interest by holding out prospects for large and seemingly lucrative contracts. The USSR will require long-term credit for equipment purchases in the future, but delay in obtaining US Export-Import Bank credits should not affect trade at present since the USSR seems able to secure adequate financing elsewhere.

In short, the USSR feels no sense of urgency to settle the problems at issue in the current trade agreement negotiations. The Soviet leaders' bargaining position could be less strong, however, if they have to continue large purchases of grain from the US over the next several years.

[Omitted here are Soviet views of various geographic regions.) At Home

The Soviet leadership, in the person of Brezhnev, announced programs of peace and butter at the 24th Party Congress in the spring of 1971. Both planks were put to the test during the next year by President Nixon's trip to Peking, by an upsurge in fighting in South and Southeast Asia, by the five-year plan, and by a critical attitude expressed by some Soviet leaders, particularly Masherov and Shelest. In spite of such problems, Brezhnev, using the Congress programs, succeeded by the eve of the Moscow summit in enhancing his political position and his public role as principal Soviet leader and international statesman.

The trends of the preceding year have continued since the President's trip to Moscow. Soviet foreign policy remains subject to shocks, while many of the fruits of détente remain unpicked and some are in jeopardy. Harvest shortfalls this summer appear to have postponed significant progress toward the regime's already rather uncertain goals for agriculture and the consumer. Nonetheless, the summit and Brezhnev's political moves have practically silenced public questioning of basic policies. Evidence of the steady accretion of Brezhnev's authority continued to the end of July. Although his just-completed tour of the eastern grain and cotton belts testifies to the concern over this year's harvest, it also illustrates again Brezhnev's forward position in the leadership.

Brezhnev emerged from the summit to salvos of official praise. Party meetings were called throughout the country, and the central press repeated reports of approval for the foreign policy activities of not only the Politburo but also of Brezhnev "personally,” the latter a new formulation. When he received Commerce Secretary Peterson on 30 July2 at his Crimean retreat, Brezhnev displayed unusual self-assurance and knowledge on matters of economic relations, and Soviet delegates at the sessions of the joint commercial commission in Moscow invoked his authority on particular questions.

Soviet officials have as much as admitted that serious reservations had to be overcome in going ahead with the summit, and the publicity given the subject afterwards suggests that the leadership continues to feel uneasy about domestic reaction. The party meetings were accompanied by forceful public justifications of the summit by important officials and commentators. For example, Vadim Zagladin, deputy to the

2 See Document 21.

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