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In a recent study published by the University of Miami's Center for Advanced International Studies, economist Roger LeRoy Miller concludes reimposition of the Rhodesian embargo would cost at least

* $300,000,000 additional per year for stainless steel consu

mers

* 2,027,000 manhours lost in the labor market per year even if the national stockpile is released. If the stockpile is not released, lost man-hours would increase to 16,700,000.

The only certain effect of the sanctions would be to injure American industry and American workers, while assuring windfall profits to Soviet chromium dealers.

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A bill has been introduced in the US. House of Representatives that seeks to cut America off from 67% of the world's reserves of metallurgical grade chromite ore. We urge the defeat of this piece of legislation (H.R. 1287). We have prepared this pamphlet to give in detail our reasons why.

I. CHROME: A GENERAL DESCRIPTION

Stainless steel is essential to a modern industrial society due to its ability to resist corrosion. Over half the chrome used in America ends up in stainless steel. As the National Materials Advisory Board states:

"It should be emphasized that for its major use - stain less steel-chromium is unique; unlike nickel or molybde num which have alternates to perform the desired function, there is no other element which can be used as a substitute for chromium. Stainless steel cannot be made without chromium.

In terms of chrome the U.S. is a "have-not" nation. Our reserves are so small as to be practically worthless, and as a result we have to import almost 100% of our needs. 2 Of the

chrome used in America 23% ends up in construction, 17% in transportation, 16% in machinery and equipment and 15% in refractory products."

What the Mideast is to oil, southern Africa is to chrome, only more so. The Republic of South Africa has 74% of the world's chrome reserves, followed by Rhodesia with 22%. However, the majority of the world's reserves of metallurgical chrome, the kind most economical for the production of stainless steel, are in Rhodesia with 67%, followed by South Africa with 22% and the Soviet Union with 6% 4 Chrome is more heavily concentrated in one area than any other major mineral on earth

II. THE MORAL FOUNDATIONS OF THE U.N. SANCTIONS

Rhodesia is the only country in the world facing UN. sanctions. Thus, if the UN is to be our moral yardstick, as some in America claim it should be, Rhodesia must be seen as the worst nation on this plaret. Yet is this really the case? Secretary of State Kissinger has stated that the Soviet Union is no closer to democracy than Rhodesia. According to Dr. Andrei Sakharov, the father of the Soviet HBomb, there are 1,700,000 people in Soviet concentration camps today. 6 Alexander Solzhenitsyn has charged that much of the Soviet mining industry, if not all of it, was built by slave labor, and no western observers have been allowed to visit the Soviet chrome mines to verify that this is not the case right now.

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As for South Africa, even the violently anti-Rhodesian Manchester Guardian has stated that "Rhodesia's iniqui"are only a pale reflection of those in South Africa. The London Economist says of black Rhodesians: "They are certainly better off financially than most black Africans south of the Sahara and, except for South African goldminers, they earn more money in real terms than the black South Africans."

So much for the "superior" morality of the other two main sources of chrome in the world A look at the rest of the world is also in order to put the U.N.'s code of morals in clearer perspective.

According to Hal Sheets of the Carnegie Endowment for International Peace General Amin of Uganda has murdered 90,000 of his own citizens since coming to power in 1971 The UN has found nothing wrong with this. In

July "Big Daddy" Amin is scheduled to become Chairman of the Organization of African Unity. 11

On March 14, 1974 columnist Jack Anderson reported that the government of Burundi "over the past two years has engaged in mass genocide on a scale the world has not seen since Adolf Hitler tried to wipe out the Jews in World War II The UN found nothing wrong with this. The UN also found nothing wrong with the fact that the majority of Burundi's citizens, the Hutus, were ruled by another tribe, the Tutsi, which excluded them from the government as well as killing them. In December 1973 the UN General Assembly endorsed a resolution proposed by Burundi which condemned Israel for "racism", 14

In the Mideast the UN has yet to find anything wrong with the atrocities of Arab terrorists. It refused to condemn the massacre of the Israeli athletes in Munich. It refused to condemn the murder of 18 unarmed civilians at Qiryat Shemona. It refused to condemn the cold-blooded slaughter of 16 Israeli schoolchildren at Maalot.

When the UN spoke out on violence in the Mideast it was to condemn the Israelis - not the terrorists. On April 24. 1974 the UN Security Council passed Resolution 347 condemning Israel for raiding camps used by terrorists in Lebanon. Under orders from President Nixon the American ambassador cast an affirmative vote for this proposal. 15

Was Mr. Nixon expressing the wishes of the U.S. Congress in voting as he did? Does Congress now have a "commitment to condemn Israel? Should Congress feel a "com

mitment to the U.N. sanctions against Rhodesia because President Johnson voted for them in 1966?

Shouldn't the U.S. Congress feel free to judge issues on their own merits? Isn't it time the U.N. was made to impose a consistent code of international law? Isn't it time the U.N. was made to honor the principles of its own charter rather than hailing people like Yassir Arafat, who just recently

claimed "credit" for the murder of 16 tourists in a small Tel Aviv hotel? 17

Until the U.N. does live up to its own charter, do we really have to go along with the Security Council Resolutions such as Number 347? Do we really have to punish our own economy by buying chrome from the Soviet Union at inflated prices "because the U.N. says so"?

III. SANCTIONS: AN EFFECTIVE METHOD OF DIPLOMACY?

Sanctions do not have a good record of accomplishing their goals. Napoleon's Continental System failed to break Britain. The League of Nations sanctions against fascist Italy drove Mussolini closer to Hitler rather than out of Ethiopia.

In our time the two best examples of sanctions are Cuba and Rhodesia. In both cases they failed. Castro still rules Cuba. There are no serious elections. Civil liberties are nonexistent as at the beginning of the blockade. Ian Smith still rules Rhodesia. The 200,000 whites who support him are no more inclined toward surrendering their power than they were in 1967. He recently won reelection by a landslide.

In both these cases the "moral" foundations of American policy have been, at best, questionable. We have continued to trade all the while with nations whose internal policies are just as foreign to our concept of democracy as those of Cuba and Rhodesia.

Other nations did not take either sanctions campaign very seriously. According to The Economist of London black African states such as Zaire, Zambia and Botswana continue to trade with Rhodesia. On April 18, 1975 the London Daily Telegraph stated flatly that "Russia entered the international black market for Rhodesian chrome in 1972." 19 Fortune magazine reported in 1971 that even the People's Republic of China was importing large amounts of Rhodesian chrome. 20 A recent U.N. report accuses Japan of importing almost 200,000 tons of Rhodesian chrome in 1972.21 The South African Rand Daily Mail pointed out in December 1974 that Japanese and French cars were cheaper in

Rhodesia than in South Africa. 22 On June 30, 1973 the respected Africa Research Bulletin of London reported evidence of massive sanctions breaking by West Germany. Japan, Austria, Belgium, Israel, Norway and Denmark 25 As for the Cuban sanctions, they were considered such a joke by the international community that even Fascist Spain continued to trade with Castro.

By supporting the sanctions America has hurt its own economy and thus the U.S. consumer. Our refusal to buy chrome from Rhodesia forced us to turn to the Soviet Union The Russians took advantage of this situation to not only raise their prices but to actually lower the quality of their exports. 24 Our refusal to buy sugar from Cuba caused us to buy sugar from the Philippines at a much greater cost.

The repeal of the sanctions against Cuba as called for in Representative Harrington's bill (H.R. 2681) would bring down the present high price of sugar. The repeal of the sanc tions against Rhodesian chrome in 1971 did the same with that material. 25

The use of trade as a weapon has tended to antagonize rather than intimidate those against whom it has been used. We have quite rightly objected to the Arabs use of this tactic in their campaign against Israel. Does it make much sense for us to turn around and use it against Cuba and Rhodesia? Shouldn't American foreign policy be talking about scrapping sanctions against foreign countries rather than imposing them? Can the American consumer really afford to pay for this kind of diplomacy?

IV. IS THE SOVIET UNION A RELIABLE SOURCE OF SUPPLY?

Assuming we are not going to boycott the three major chrome nations because of our differences with their internal policies, it seems logical to examine the chrome question from a practical point of view.

Is the Soviet Union a reliable trading partner? In December 1974 the National Security Council and the Council on International Economic Policy stated that the Soviet Union could not be counted on to maintain a continuous flow of chrome ore to the U.S. 26 According to U.S. News and World Report in 1972, the Soviets had, by that time, broken 24 out of the 25 agreements signed with us during the seven previous summit meetings. 27 In 1973 they broke within months their promise at San Clemente to keep the peace throughout the world. Not only did they fail to warm us of the impending Mideast war but once it began, the Politburo sent out messages urging other Arab states to join in the fray against Israel. 2 Radio Moscow rejoiced at the Arab oil em

bargo and encouraged them to keep it up as long as possi ble 29 The Russians even threatened their own oil embargo against Iceland unless it closed down its vital NATO airbase. Meanwhile, as Newsweek put it, "The only country besides the United States that offered Israel aid was the government of South Africa." 31 Thus, the recent mideast crisis found South Africa and the United States on one side and the Soviet Union on the other. Is it not fair to conclude from their recent behavior that South Africa is a more reliable source for a strategic raw material than the Soviet Union? Does it make sense to regard the Soviet Union as a more reliable trading partner than Rhodesia, a country which offered us material support during our dark days in Vietnam? 32 From a practical point of view wouldn't it make more sense to end chrome imports from the Soviet Union if we are going to implement a boycott?

V. THE CHROME STOCKPILE: CAN WE AFFORD TO DUMP IT?

Backers of H.R. 1287 claim that America can afford to end chrome imports from Rhodesia because we have an overabundance of this mineral in our strategic stockpile right now.

To substantiate this argument they point to Richard Nixon's plan to reduce the US. stockpile of metallurgical grade chromite ore to 445,000 tons. They do not mention that Senator John Sparkman, Chairman of the Joint Con

gressional Committee on Defense Production, called this proposal "an excellent example of the willingness of the Executive branch to rely heavily on foreign sources of supply or unrealistic estimates of domestic production for meeting military and civilian requirements. 33

In 1974 America consumed 894,708 tons of metallurgical grade chromite ore. If the stockpile is reduced according to Mr. Nixon's plans there will not be enough chrome on hand to last half a year at the present rate of consumption.

As of January 1, 1975 there were 1,962,000 tons of usable metallurgical grade chromite ore in the national stockpile. This should be kept. There are no serious natural reserves of chrome on the North American mainland. If we ever ran out of this material during a war it would have to

be imported by sea from countries thousands of miles away. Chrome is vital to the health of a modern industrial economy.

We should also remember that the stockpile has economic as well as strategic significance. It's the best guarantee we have against arbitrary rises in the prices chrome exporters choose to charge us. It gives us the option to refuse to purchase chrome that is not offered at a reasonable price.

The Arab oil embargo and the subsequent price rise by fiat of the OPEC cartel have shown the dangers of not maintaining adequate stockpiles of critical imported materials. In the case of chrome the supporters of HR. 1287 have apparently chosen to ignore these dangers. Can the American people afford to do likewise?

VI. FERROCHROMIUM AND RHODESIA

The main end use of chrome in America is stainless steel. Metallurgical grade chromite ore cannot be turned directly into stainless steel. It must first be turned into ferrochromium.

One of the major economic trends of our time is the move by developing countries to process the raw materials they export, thus generating more foreign exchange. This is apparent in Mideast where the oil exporters are involved in a major refinery building program. 35 It is apparent in Africa and the Caribbean where Guinea 36 and Jamaica have announced plans to build huge plants that will convert bauxite into alumina for export. Rhodesia and South Africa have followed this trend. Both have built major ferrochromium plants.

Needless to say it is cheaper to process a raw material near its source than thousands of miles away. Thus the processing industries of the producing countries will be able to undercut the processing industries of the consuming countries. It is also important to note that it is more profitable to export a semi-finished product than a raw material so the producers are likely to emphasize the export of the former at the expense of the latter in the future. What all

this means is a change in the world economic order. It means more money flowing from the more advanced nations toward the developing world.

The rise of the Rhodesian ferrochromium industry is part of this change. It is not due to "slave labor" as supporters of H.R. 1287 claim. According to the London Economist the black workers of Rhodesia are among the highest paid in Africa. The price difference comes from the low costs of transportation and the cheap hydro-electric power gener ated by the Kariba Dam.

Cutting America off from chrome and ferrochromium from Rhodesia will not save the U.S. ferrochromium industry. South Africa is engaged in a massive expansion of its ferrochromium facilities. It's unlikely the Russians will stay out of such a profitable business for long. Sanctions failed to help the US. ferrochromium industry in the past. While they were in effect, the US. production of ferrochromium fell from 313,793 short tons in 1967 to 244,030 short tons in 1971,39 the last year of the sanctions. The repeal of the sanctions raised U.S. ferrochromium production to 304,952 tons in 1974 40 It's difficult to see how their restoration will be of much help in this area of the economy.

VII. RHODESIAN SANCTIONS AND U.S. UNEMPLOYMENT

While it's unlikely that the passage of H.R. 1287 would do much good for workers in the American ferrochromium industry, there is serious evidence that this bill would be a disaster for workers in the US. stainless steel industry. According to a detailed study of the situation by the Center for Advanced International Studies at the University of Mi

ami, a renewal of U.S. sanctions against Rhodesia would reduce the amount of work in the American stainless steel industry by 2,000,000 manhours.

Thus, it is likely that the passage of HR 1287 would accentuate the worst aspects of the present "stagflation". It would increase both inflation and unemployment

VIII. WILL TRADE WITH SOUTHERN AFRICA LEAD TO EMBARGOES FROM BLACK AFRICA?

This is a possibility but not a very likely one. In the eyes of black Africa the U.S. is not the major violator of the sanctions. At the annual meeting of the Organization of African Unity in 1974 Japan was named as the "most notorious sanctions buster". France was labeled as the second biggest villain. 41 The black African states do not like the fact that in 1971 America joined Switzerland and South Africa in openly repudiating the UN sanctions but they are well aware of who is doing the most sanctions breaking.

The black states have shown little inclination to go beyond rhetoric in punishing western states for their trade with southern Africa. France, for instance, has very good relations with black Africa. French corporations today

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In the case of cobalt large reserves exist in Australia, Canada as well as Zambia and Zaire. 44 It may soon be possible to mine the huge amounts that lie on the sea floor 45 Furthermore, as a special commission of the European Common Market points out, there are many materials that can be substituted for cobalt should the need arise. This is not true in the case of chrome.)

In the case of manganese Gabon's reserves are equalled by those of Brazil and South Africa, and manganese may also soon be mined from the sea floor. Furthermore, there

is a current excess mining capacity among the world's major producers. 49

At present Guinea's large bauxite reserves are not important to us since we do not import much of this material from Guinea Even if we did it is important to keep in mind that Australia has just as much bauxite as Guinea.5

50

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Should the House vote to impose sanctions on Rhodesian chrome, it will be engaging in what The Washington StarNews has quite rightly called an "exercise in selective morality". 60 Can a morality that is selective be much of a morality at all? Does anyone really believe that the Soviet Union is morally superior to Rhodesia?

While we are not only trading with the Russians but also granting them massive low-interest credits and, at one point, even offering to sell them police equipment to help them crush domestic dissent," can we really find a "moral"

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5 Testimony before the Senate Finance Committee 7 March 1974

6 Andre Sakharov Sakhara Speaks Knopf. NY 1974 p 45

7 The Daily Telegraph London: June 1974

The Manchester Guardian Weekly International Edition 22 March 1975

9 The Economist London 16 November 1974

10 The New York Times, 4 August 1974

11 The Washington Post, 18 March 1975

12 Jack Anderson in The New York Post 14 March 1974

13 Roger Morris, Passing By The United States and Genocide in Burundi 1972

The Carnegie Endowment for International Peace 1974

14 The Washington Post 6 July 1974

15 United Nations Office of Public Information UN Monthly Chronicle

May 1974 p 34

16 The New York Times 25 April 1974

17 TIME. 17 March 1975

18 The Economist London 16 November 1974

19 The Daily Telegraph London 18 April 1975

20. Fortune, April 1971

21 The Financial Times London 2 July 1974

22 Th. Rand Daily Mef 10 December 1974

23 The Africe Research Bulletin London 30 June 1971

24 The National Materials Advisory Board op of p 16

25 US Bureau of Mine Minerul Yearbook and Mineral Industry Surveys

26 The National Security Council and the Council or International Economic

Policy Special Repor: Critical Imported Mukeria' December 1974 p 17

27 US News and World Report 29 May 1972

28 The New York Times, 16 October 1973

29 Vitor Zorza in The Wa hington Post 20 November 1973

The New York Time 13 March 1974

30 CBS News 8 February 1974

try as a whole has still not recovered from the ravages of the recent civil war. Nigeria needs all the money it can earn from the sale of its oil. We should also keep in mind that Nigeria does not represent a large percentage of the world's total oil reserves. It has 3 of the world's total supply of petroleum

On the other hand, Rhodesia and South Africa control almost all the chrome in the world - 96% Together they control 89% of the world's reserves of metallurgical chrome, and Rhodesia alone controls 67%. All the black African states together do not control any major mineral so completely. While there are viable alternatives for every major mineral we get from black Africa, there are no long range viable alternatives for the chrome from southern Africa. Thus, if we had to choose between trade with black Africa and trade with southern Africa, the choice would have to be in favor of southern Africa.

Furthermore, we should not allow American policy to be changed by foreign economic blackmail. Rather than dumping raw material stockpiles as Nixonomics decried to cover up a failure to fight inflation, we should build up stockpiles of raw materials we lack at home and institute a strict recycling program to make the most efficient use of what we do import. We should try to diversify our sources of raw materials giving particular preference to those nations who pursue generally friendly policies toward the US Appeasement has never been a very good method of dealing with ag gression - be it military or economic.

argument for not trading with Rhodesia? Is it logical to consider the Soviet Union a reliable source for a strategic raw material when it breaks agreements with us within months of signing them? Is it practical to cut the US. consumer off 67% of the world's reserves of metallurgical chrome? Should we fuel the present high rate of inflation in America by actions which will most surely drive up the price of a commodity we import? We think not. We most strongly urge the House to kill the Rhodesian chrome bill when it reaches the floor.

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49 The National Security Council and the Council and the Council on Internat wha Economic Policy op of p 33

50 US Department of Con merce. Imports Commodity by Country December 19′′

51 US Bureau of Mines. Minerals Year 1971 Volume 11 p 35

52 The Congressional Record 18 December 1973 p. S2115

53 US Department of Commerce op of

54 The Morgan Guarantee Sur March 1974

55 The New York Times. 22 April 1974

56 The Washington Pist 24 October 1974

57 Th. Manchester Guerilian sweekly International Edition 12 October 1974

58 The Oil and Gas Journal 30 Dember 1974

59 US Bureau of Mines Bulletin 650 1920 p 251

60 The Washington Stor Nu 21 December 1973

61 The New York Times 18 July 1974

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