The increased jamming of Radio Free Europe and Radio Liberty broadcasts; and The Soviet Union's success in forcing the exclusion of Radio Free Europe reporters from the winter Olympic Games and its current attempts to have them excluded from the Montreal Olympics this summer. This, then, has been a partial catalogue of the USSR's crimes against détente. We hardly need ask ourselves: Have these Soviet actions relaxed international tensions? Do these actions reflect a USSR "accommodation" to the free world or an intention to enlarge a spirit of amity between the Soviet Union and the free world? CONTINUED COLD WAR Of course they do not. Rather than any mythical détente they suggest a continuation of the Cold War by the Soviet Union, even if on a somewhat diminished scale. But even a diminishment is questionable in view of Angola and the Soviet Union's unforgivable arming of the Arab countries for their almost inevitable attempt to destroy Israel. But surely we who have lived with Soviet Communism for more than a halfcentury cannot be astonished at the Soviet Union's making a mockery of Dr. Kissinger's mythical détente. We witnessed, after all, the Soviet Union's rapid opposition to the post World War II Marshall Plan and programmes to rehabilitate war-torn Europe. And we witnessed the building of the Berlin Wall, the ultimate symbol of Soviet Communism's paranoia and fear of contact with the West. And we witnessed the occupations of Hungary and Czechoslovakia and the murder of Vietnam with Russian weapons. Détente, we can now see, was a figment of Dr. Kissinger's imagination rather than a practical, realistic formula for easing tensions and creating friendlier relations between the US and USSR. And Brezhnev has confirmed this in stating that under détente there was no change in Communist objectives either in the Soviet Union or abroad. Was it wishful-thinking that made us forget, temporarily, that the USSR is a Marxist state irrevocably committed to the "class struggle" and to the destruction of capitalism and so-called bourgeois society? A GRAND DELUSION Détente was Dr. Kissinger's "grand delusion," his self-delusion, his confusion of fiction with fact. The tragedy is that his delusion was able, for a time, to mislead many Americans, including much of the intellectual community and the press. One of the riskiest consequences of détente was that it encouraged American businessmen-who should have known better-to exchange their technological secrets for a mess of pottage. They gave away, almost for nothing, the technological and scientific advantages we have traditionally held over the Soviet Union. We are going to live to regret the exchange of those secrets for the right to sell Pepsi-Cola in Murmansk and the transplantation of Alaskan musk-oxen to Siberia. We quickly lived to regret the first big deal under détente. The mammoth sale of grain to the USSR proved, first, not as profitable as originally anticipated; second, highly expensive for American consumers who found themselves paying higher and higher prices for bread and, third, it gave the Soviet Union control of world food surpluses at a profit and without having grown any of those surpluses. But once again in 1976 American businessmen--industrialists and farmersare going to prop up the faltering Soviet economy with American technical knowhow and with America's golden sheaves of grain. Détente failed failed even a myth-for the above and for other reasons. Joseph Kraft, a widely syndicated American newspaper columnist, recently put his finger on another reason for the myth's collapse. ROLE OF KISSINGER "Vietnam alone does not explain the widespread disillusionment with détente”, the columnist wrote. "By no mere accident the term has acquired a bad name just as the stock of the Secretary of State has dropped. "To a large extent the fault lies with Dr. Kissinger himself. For years he has disparaged the role of moral feelings in foreign policy. He has systematically favoured corrupt and repressive governments of the right wing. He has been deceptive with Congress and the country. The fact is that Dr. Kissinger does not satisfy the yearning Americans feel for a foreign policy with moral content. His diplomatic style reinforces the uneasy feeling that détente means trafficking with the Communists to no good end." It should be added that Kissinger's lack of a “foreign policy with moral content" is also sadly and reprehensibly evidenced by his encouragement-through failure to do anything and failure to say anything-of the 200 American business firms that have joined the Arab boycott campaign against Israel. Through a variety of available means Kissinger could have put a halt to this disgraceful participation by American businesses in the Soviet-approved boycott. But Kissinger's desire to appease the Soviet Union is almost obsessive. That is why he came before Congress and asked us to guarantee financial credits to enable the USSR to develop undeveloped resources. Congress did not approve the Kissinger guarantees. Even while the détente bubble was continuing to disintegrate, Kissinger could not bring himself to admit it. Instead he declared in a national broadcast that "politically I think any candidate who says 'abandon détente' will be the loser in the long run". President Ford obviously didn't believe his Secretary of State. A few weeks later he abandoned détente. Thursday, April 22, 1976, Morning SUMMARY OF DISCUSSION SESSION III-DISCUSSION OF A WORKING DOCUMENT ON A DRAFT CODE OF PRINCIPLES ON MULTINATIONAL ENTERPRISES AND GOVERNMENTS (Working Documents: Mr. Gibbons and Mr. Lange, and Mr. Archer) 1 Mr. Gibbons, rapporteur for the American delegation, felt that the internationalization of production was basically to positive phenomenon. There was therefore no question of hostility to the multinational enterprise as such. But there was an obvious need for a number of directives on the activities of enterprises engaged in international operations. It was true that other organizations, in particular the OECD, were preparing relevant directives. The OECD draft 2 relied, however, on voluntary commitments, whereas what the two rapporteurs wanted was a binding agreement. It was certainly not intended that national sovereignty should be affected by the agreement. It was for this reason that the draft contained a provision to the effect that, in the case of disputes, the law of the host country should take priority. The draft was based on the principle of equal treatment for multinational and national enterprises. Mr. Gibbons regretted that publicity about multinationals usually concentrated on their shadier aspects. This would certainly result in an intensified investigation into their activities. BINDING CODE NEEDED Mr. Lange, rapporteur for the European Parliament delegation, felt that the chances of success for the draft had improved now that certain undesirable practices of enterprises operating across national frontiers had recently been the subject of publicity. From what had been revealed it must be obvious that a voluntary code would be quite useless. What was needed was a legally binding set of rules applicable throughout the world. Economic structures had developed more rapidly than political ones. The political sector had to catch up. Many of the activities of international enterprises could no doubt be termed legal in a formal sense, but this did not mean they were acceptable. Such activities had to be made impossible. It was inadmissible that national parliaments should tolerate a situation where large enterprises could lay down the law to the political authority. 1 See pp. 29 and 35, respectively. 2 See p. 71 for OECD proposed code. Efforts to achieve an international agreement on enterprises operating across national frontiers were not something that had just come into fashion. As early as 1947, when GATT came into being, consideration had been given to introducing international regulations. Both delegations should at least be able to reach agreement on the principle of a legally binding agreement by the end of the morning. SERIOUS OBJECTIONS RAISED Mr. Archer stated that he had serious objections to the draft put forward by Mr. Gibbons and Mr. Lange. In his view, intervention by government authorities in the manner proposed in the draft report was not the best way to solve the problems attendant on internationalization of production. The proposals contained in the working document could lead to the creation of an international organization with powers that should be entrusted only to an elected body. Mr. Archer raised the following specific points in connection with the working document: Paragraph 5: the idea of introducing "political control” appeared to conflict with the free enterprise system. Paragraph 10: it is a questionable procedure to say that, in case of disputes, the law of the host country would prevail. Paragraph 11: it was doubtful whether an international secretariat of the kind intended here could provide the most satisfactory solution to the problem. Paragraph 14: this passage required further explanation. Paragraph 17, ff: harmonization of legislation on competition could be useful, although the effect it would have was still uncertain. Paragraph 20: it is asking too much to require enterprises to provide the authorities responsible for competition matters with all the information asked for. FURTHER OBJECTIONS Paragraph 22: the obligation to report all projected investments should not mean that approval by a government authority should be required in advance. Paragraph 24: this gave excessive power to government authorities. Paragraph 26, ff: provisions amplifying existing regulations seemed unnecessary, since a sufficient number of taxation agreements had already been concluded between the industrial countries. Paragraphs 27, 28, 32, 33 and 34 were out of place in the working document. Paragraph 42: this required further explanation. Paragraph 44: There is no reason why residents of the host country had to be allowed to acquire shares. Paragraph 45, ff: labor market policy was best left to the enterprises and trade unions. Mr. Archer felt that it was unnecessary that "at least one host country national should have a seat on the management board." Paragraph 52: this required further explanation. Paragraph 53: this passage should be elaborated further. Recapitulating, Mr. Archer felt that the changes he had proposed would considerably improve the document by Mr. Gibbons and Mr. Lange; however, there were still insufficient guarantees of the fundamental rights of sovereign governments, the owners of multinational enterprises, and their employees. PREVENTING FUTURE ABUSES Mr. Hougardy felt that it was not enough to investigate the scandals such as those that had recently come to light, but that a way had to be found of preventing their recurrence. The draft prepared by Mr. Gibbons and Mr. Lange was aimed at both multinational enterprises and governments, but especially at the former. Care should be taken to ensure that the code was not used as a pretext for restrictive national legislation. Governments must also accept rules of good conduct in this complex area. As regards free access to information on multinational enterprises, Mr. Hougardy felt that the provisions in force in the United States could well serve as a model. It was extremely difficult to lay down comprehensive rules on transfer prices: who was to say what was a fair transfer price, what came just within acceptable limits and what was unacceptable? It was somewhat alarming that so many organizations were occupied with the problem of international production at the same time. It was surely obvious that an attempt should be made to include Japan in this entire effort and also to coordinate efforts with the OECD. Further progress could then be based on what that organization had already achieved and in this way there might also be less scope for nationalistic tendencies within that organization. In conclusion, Mr. Hougardy wondered if the problem of multinational enterprises should not also be raised in the North-South dialogue. A STRONGER CODE NEEDED Mr. Prescott felt that there was no need to discuss further the principle of an international agreement on multinational enterprises; it was obvious that there had to be a binding agreement. There were two points no which he questioned the proposals by Mr. Gibbons and Mr. Lange. It was very doubtful whether competition policy provided the best means of keeping the power of multinational enterprises within limits. The question of investments was more to the point, since this was what determined economic trends. Secondly, it could be dangerous to proceed on the principle that the law of the host country should take precedence in case of disputes. There was always the possibility that certain countries would see the advantage of maintaining or introducing arrangements favourable to multinational enterprises. NEED FOR BETTER INVESTIGATIONS Mr. Prescott finally suggested that the European Parliament ought to make more use of methods of investigation of the kind regularly used in the United States, like public hearings, for example. Mr. Normanton felt that it was hopelessly unrealistic to expect that binding rules could be instituted on a worldwide scale. Integrity was |