Weinberger Calls On Summiteers To Link Aid To East To Fundamental Change In Soviet Threat

(Washington, D.C.): The Center for Security Policy today released excerpts of a major address to be given by former Secretary of Defense Caspar W. Weinberger on Thursday, 13 July at the Town Hall of California in Los Angeles. In his prepared remarks, Secretary Weinberger urges that the leaders of the major Western democracies use the upcoming Paris Economic Summit to fashion a new approach to economic, financial and technological assistance to the East bloc.

Mr. Weinberger argues: "We should proceed expeditiously…to identify, on an alliance-wide basis, appropriate linkages between Moscow’s need for economic and financial assistance, and concrete actions by the Soviets to reduce the global threat to freedom…." The former Defense Secretary recommends the following as among the needed elements of such a policy approach:

• "A multi-year, proven record of sharply reduced defense spending;"

 

• "Irreversible market-oriented economic reform, including price reform:" and

 

• "A comprehensive agreement on Western lending to Warsaw Pact countries and Soviet client states which phases out government-guaranteed credits, untied loans (including Soviet bonds) and greatly enhances reporting requirements."

Secretary Weinberger cautions: "We have all seen the consequences of undisciplined, government guaranteed loans and bail-outs as we watch the $200 billion-plus S&L crisis, and much of that great burden will be borne by our taxpayers."

Mr. Weinberger also calls upon participants in the Economic Summit in Paris to adopt a policy of vigorous differentiation in Eastern Europe that involves the "stick," as well as the "carrot." He observes that: "While Poland and Hungary are making efforts to reform, East Germany, Czechoslovakia, Romania and Bulgaria are not. East Germany still remains one of very few cash producers for Moscow, and too often funds and helps carry out Soviet ‘dirty work’ throughout the Third World. There is every reason to be especially concerned about the diversion by East Germany of borrowed Western funds for purposes harmful to vital Western interests."

The Center notes that this same point is made in a powerful, hour-long television documentary, entitled "Follow the Money," that will be aired this evening at 10:00 p.m. on Public Broadcasting System stations nationwide. The film offers a detailed look at the adverse implications for Western security interests of undisciplined flows of economic, financial and technological assistance to the Soviet Union and its allies.

The excerpts of Secretary Weinberger’s speech released by the Center today are attached.