THE PRESIDENT'S DAILY BRIEF 14 FEBRUARY 1974

• Document Type: FOIA
• Collection: President's Daily Brief 1969-1977
• Document Number (FOIA) /ESDN (CREST): 0006007674
• Release Decision: RIPPUB
• Original Classification: T
• Document Page Count: 13
• Document Creation Date: August 14, 2016
• Document Release Date: August 24, 2016
• Publication Date: February 14, 1974

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The President's Daily Brief
February 14, 1974
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,Exempt from general
declassification schedule of E.O. 11652
exemption category 58(1),(4(3/
declassified only on approval of
the Director of Central Intelligence
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THE PRESIDENT'S DAILY BRIEF
February 14, 1974
PRINCIPAL DEVELOPMENTS
An intercepted message indicates that the Khmer
Communists will attempt a major push in the Phnom
Penh area later this month. (Page 1)
Mrs. Meir's Labor Alignment appears to have reached
an impasse in efforts to induce the National Reli-
gious Party to join a coalition government. (Page 2)
The Washington energy conference showed some shifts
in power relationships within the EC. (Page 3)
?The governors of EC central banks have discussed
coordinating intervention to keep the EC's major
floating currencies at rates that will avoid major
shifts in trade patterns in the EC. (Page 4)
The bitter propaganda exchange between Seoul and
Pyongyang appears to have ended prospects for any
meaningful North-South accords for the present.
(Page 5)
Border fighting last weekend between Iran and Iraq
may have been caused by Iranian road-building in a
disputed border area. (Page 7)
The second of four Soviet space probes launched
last summer arrived in the vicinity of Mars on
February 12 and is now orbiting the planet. (Page 8)
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Phnom Penh
,
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Statute Miles
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CAMBODIA
The Khmer Communists apparently have decided to
attempt another major push in the Phnom Penh area
later this month. An intercept of February 11 indi-
cates that the standing committee of the Khmer Com-
munist Party reached the decision at a meeting last
week, and instructions are now going out to battle-
field commanders.
The overall strategy outlined in the message
calls for coordinated attacks on several fronts
around Phnom Penh. The only detailed tactical plans
contained in the message were for units southeast of
the capital. Three Communist regiments there are
scheduled to participate in a push up Route 1. The
Communists evidently expect to begin the attacks
around February 25.
How the Communists carry out these latest plans
will be governed largely by whether they can over-
come their shortcomings in command and control. In
addition, many Communist units in the capital region
have been in combat for almost two months and may
need an extended period of rest and refitting. Such
factors could delay, increased Communist pressure
against Phnom Penh until next month.
In any case, the Communists evidently intend to
keep up their periodic shellings of the capital. An
intercepted message yesterday indicated that insur-
gent gunners south of Phnom Penh have been ordered
to try to hit new targets within the city.
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_
ISRAEL
Israeli Prime Minister Meir's Labor Alignment
appears to have reached an impasse in efforts to
induce the conservative National Religious Party
to join a coalition government. Press reports from
Tel Aviv indicate that the National Religious Party
has at least temporarily withdrawn from coalition
talks.
Faced with this predicament, Prime Minister
Meir might form a narrow coalition excluding the
National Religious Party. Foreign Minister Eban
told Ambassador Keating on February 12 that unless
the religious party softened its terms for participa-
tion, the Alignment would form a coalition with only
the Independent Liberal Party and the new Civil
Rights Party. ?Eban added that two cabinet seats ,
would be held open for the National ReligiOus Party.
This, he contended, would entice it to rejoin the
government eventually.
A coalition without the National Religious
Party would give Mrs. Meir a one-vote margin in the
120-member Knesset--a margin Eban admitted would
be "uncomfortable." He said that the Alignment had
secured the tacit agreement of the Agudat Religious
Front to throw its five votes to the government on
national security issues and on votes of confidence.
The Communists, he thought, would also support the
government against the right on Middle East peace
issues.
It remains doubtful whether the Alignment will
carry through on its threat to go ahead without the
National Religious Party. Mrs. Meir probably still
thinks that participation by the National Religious
Party, with its ten Knesset seats, is needed if she
is to govern effectively.
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EUROPE
The Washington ?energy conference not only left
France in isolation, but showed some shifts in the
power relationships within the EC.
The decision of the conference to approve a
call for "direct preparations of a conference of
consumer and producer countries" contradicted the
position paper that all the EC governments had ac-
cepted prior to the meeting. Although ostensibly
a procedural matter, the French saw this point as
raising the broad question of Europe's future rela-
tions with the US. They choose to stick to the
view that acceptance of even a coordinating group
composed of conference participants amounted to an-
other European capitulation to "domination" by Wash-
ington--a charge to which many Europeans are on oc-
casion syMpathetic.
In this instance, the French were unable to carry
the other EC members with them. Their failure stemmed
in part from the Europeans' lack of confidence in
their ability -be) cope with the energy crisis without
US cooperation. It was also one of the first indica-
tions that, with the EC's enlargement, Paris cannot
in every instance call the tune. The Germans, who
are in a strong position because they hold the presi-
dency of the EC Council, were not prepared to go
along with the French, particularly since Bonn had
the support of the British.
The immediate problems the community faces are
no doubt difficult. The EC governments have post-
poned a meeting of foreign ministers scheduled for
today at which the European-US declaration of prin-
ciples was to have been discussed. The governments
had also planned to announce after the meeting a
wide-ranging offer of cooperation with the Arab
states.
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EC
The governors of EC central banks met' on Tues-
day and discussed the possibility of coordinating
intervention to keep the EC's major floating cur-
rencies--the pound, lira, and French franc--at
rates.that will not cause major shifts in trade
patterns within the EC. On Monday, French Finance
Minister Giscard d'Estaing had announced that the
EC was considering "joint monetary action" and that
the French hope to offer concrete suggestions when
community finance ministers meet on February 18 to
discuss the possibility of joint intervention.
Despite the willingness of EC members to talk
about rules of conduct for their floating currencies,
an effective agreement.to maintain exchange rate
patterns through intervention would be very diffi-
cult to achieve. On the contrary, uncertainties
over exchange rates caused by the rise in oil prices,
coupled with the recent easing of capital controls
in several EC countries, will probably lead to sig-
nificant currency adjustments this year. These
could only be prevented by heavy intervention, if
at all.
The recent French decision to float the franc
independently, as well as the earlier British and
Italian decisions to float the pound and the lira,
was made largely out of fear of massive reserve
losses similar to those they sustained while trying
to maintain fixed rates. Thus, it is highly un-
likely they would agree to use their reserves for
heavy intervention, particularly since they will
need those reserves to finance balance-of-payments
deficits resulting from higher oil prices.
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?
KOREA
The bitter propaganda exchange between Seoul
and Pyongyang appears to have ended, at least for
the time being, prospects for any meaningful North-
South Accords. The immediate background of the ex-
change is the dispute over South Korean access to
islands off, the Korean west coast, but other factors
are feeding the deterioration in relations.
Seoul has magnified the territorial sea dispute
in order to claim that the North Korean military and
subversive threat has increased and thereby to jus.-
tify its own crack-down on domestic political unrest.
Seoul supports its case by pointing to recent bellig-
erent statements from North Korean leaders.
Pyongyang's statements are indeed strong--the
harshest since North Korea began the dialogue with
the South in 1971.- The North Koreans accuse the
Pak government not only of repression but also of
hostility to the commonly accepted goal of Korean
national unification. They emphasize what they
call Seoul's provocative naval activity in the area
of the western islands and stress that North Korea'
is willing to meet, any hostile move by the South.'
Pyongyang intends these statements to exacerbate
what it sees as a gradually crumbling political sit-
uation in South Korea,.and wants to avoid any move
that might help Pak improve his domestic position.
This accounts for the relatively low military posture
that the North has adopted on the territorial seas
dispute. There has been no significant harassment
for over a month, and there have been no clashes or
incidents that Pak could use to rally support.
Pyongyang has also worked to prevent even an appear-
ance of progress in the ongoing North-South dialogue;
it has rejected Seoul's concept of a nonaggression
pact and rebuffed other ROK efforts to generate some
forward movement in their talks.
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SOUTH VIETNAM
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IRAN-IRAQ
The border fighting last weekend between Iran
and Iraq may have been caused by Iranian road-building
in a disputed border area.
an Iranian construction crew
ignored repeated warnings from Iraqi border guards
to cease work on a road that the Iraqis claimed was
being built on their side of the border. On February
4, the Iraqis opened fire but were driven back. The
Iranians later seized a strategic hill overlooking
the construction site, but on February 10 the Iraqis
recaptured it using artillery and armor. The Iranians
again counterattacked and pushed several miles inside
Iraq.
The Shah's instructions to his troops to hold
the territory they have gained may have prompted Iraq
to call for a Security Council meeting, rather than
make another attempt to retake the area by force.'
Iran's military moves in the area also undoubtedly
account for its opposition to Security Council involve-
ment. Consultations are continuing at the UN in an
effort to avert the formal Security Council session
now scheduled for Friday morning. Secretary General
Waldheim has informally offered to send an observer
to the Iran-Iraq border area.
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USSR
? Mars 5, the second of four Soviet space probes
launched last summer, arrived in the vicinity of Mars
on February 12 and is now orbiting the planet.
Two days earlier, Mars 4 passed within about 900
miles of the planet. In a rare disclosure of failure,
the Soviets announced yesterday that Mars 4 was also
intended to orbit the planet but failed. There is
a possibility that Mars 4 released an instrument
package to obtain data and pictures from the planet's
surface.
The two other space probes--Mars 6 and 7--should
arrive in early March.
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Top Secret
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