THE PRESIDENT'S DAILY BRIEF 12 JUNE 1975

• Document Type: FOIA
• Collection: President's Daily Brief 1969-1977
• Document Number (FOIA) /ESDN (CREST): 0006014822
• Release Decision: RIPPUB
• Original Classification: T
• Document Page Count: 14
• Document Creation Date: August 14, 2016
• Document Release Date: August 24, 2016
• Publication Date: June 12, 1975

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The President's Daily Brief
? 1 .
June 12, 1975
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Exempt from general
declassification scheduk of E.O. 11652
exemption category, 5341),(2).(3)
declassified only on approval of
the Director of Central Intelligence
; IS
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FOR THE PRESIDENT ONLY
June 12, 1975
Table of Contents
OPEC: The conference in Gabon has adjourned with-
out resolving several key issues. (Page /)
MBFR: The NATO allies reacted favorably yesterday
to the US proposal to end the stalemate at the
force reduction talks by introducing an offer
to withdraw US nuclear warheads. (Page 3)
SPAIN: Prime Minister Arias has made little prog-
ress in developing greater popular participa-
tion in government. (Page 5)
INTERNATIONAL: Initial foreign reactions to the
Rockefeller Commission's report are summarized
on page 7.
NOTES: Cambodia; Vietnam-Cambodia;
(Page 9)
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OPEC
The OPEC conference in Gabon has
adjourned without resolving several key
issues, including the size of the price
increase to be introduced in the fourth
quarter. In what may have been a delib-
erate maneuver, the senior Saudi and
Iranian oil officials--Yamani and Amou-
zegar--did not attend the meeting.
Their absence precluded major deci-
sions at the conference and allows both
countries greater flexibility to tailor
their policies to changing conditions
in the world oil market.
The ministers attending the meeting indicated
general support for price increases to compensate
for inflation, but referred the matter for the
time being to OPEC's economic experts who are to
meet in Vienna next month. This respite will en-
able OPEC better to assess the inflationary trends
and the returning demand for OPEC oil. OPEC of-
ficials have three months to reach a final deci-
sion on the next price increase scheduled for con-
sideration by the ministers at the meeting begin-
ning on September 24.
The conference agreed in principle to shift
the unit of account used in expressing oil prices
from the dollar to the International Monetary
Fund's Special Drawing Rights. It did not make
clear, however, how this change will affect prices
in terms of dollars. Venezuelan Oil Minister
Hernandez says that the effect will depend on the
base period chosen to fix a relationship between
the value of the SDRs and the dollar. The base
period has not yet been selected, but OPEC is con-
sidering July or September 1975 rather than some
earlier date as had been expected. The choice of
such a base period would leave the dollar price of
oil essentially unchanged initially. This result
seemingly conflicts with Hernandez' other state-
ment that the initial increase in the dollar cost
of oil would be around 3 percent. The latter
figure may derive from a calculation made earlier
on the basis of a December 1974 base period.
(continued)
1
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Among other developments at the conference:
--OPEC failed to resolve the complex issue of
oil price indexing and returned the matter to
the economic commission for further study in
July.
--Members apparently accepted none of the
schemes proposed for new oil price differen-
tials.
--Several Arab members rejected the US initia-
tive to resurrect the producer-consumer con-
ference, while some others--reportedly in-
cluding Venezuela--considered the proposal an
adequate basis for resuming discussions.
--Gabon, as expected, was accorded full mem-
bership as the thirteenth state in OPEC.
--The applications for membership by Syria and
three other countries were sent to a special
commission for study--an action indicating
that one or more of the five original members
oppose their admission at this time.
Preliminary data for May reinforce our belief
that OPEC production has bottomed out. Saudi Arab-
ian output averaged 7 million barrels per day, a
gain of 1.1 million barrels per day from April.
The reasons for this increase are unclear, but seem
to involve a variety of temporary factors and a
decision by the companies to stop reducing stocks
rapidly.
The Saudi increase more than offset production
declines in other OPEC countries. Venezuelan out-
put was cut by 80,000 barrels per day in keeping
with the government's program to reduce production
to 2.4 million barrels per day in 1975 as a conser-
vation measure. Output in Ecuador fell by 90,000
barrels per day largely because of Quito's differ-
ences with the operating companies.
2
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MBFR
The NATO allies reacted favorably
yesterday to the US proposal that the
West seek to end the stalemate at the
force reduction talks in Vienna by in-
troducing the so-called Option III--an
offer to withdraw US nuclear warheads and
delivery systems in return for the So-
viet Union's withdrawing armored forces.
The allies have been awaiting the US initiative
for some time, and nearly all agree in principle
that some form of an offer to withdraw nuclear ele-
ments must be made to end the deadlock at the talks.
Exactly what should be sought in return and when
the offer is to be made must still be decided. What
forum the allies should use to discuss these issues
is also undecided.
The British and West Germans have been consult-
ing closely with the US on the possible withdrawal
of some nuclear elements. London and Bonn will not
oppose the nuclear offer, but they have reservations
about certain aspects of the US proposal. The Ital-
ians and Turks are on record as opposing any nuclear
offer, but probably will go along.
Yesterday, the British representative at the
meeting of the North Atlantic Council said London
is prepared to accept the US suggestion that NATO's
senior political committee, reinforced by experts,
discuss the issues involved. He added, however,
that the British are still interested in having a
separate working group examine various aspects of
the nuclear issue. Various British officials have
stated that they believe this group will require two
or three months to make such a review.
Other allies--the West Germans, the Italians,
and probably the Belgians--are likely to support
the British desire to use the working group.
NATO's senior political committee will discuss
the nuclear offer today and will probably meet with
the experts in about ten days.
(continued)
3
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The NATO allies yesterday also discussed the
possibility of press leaks about the nuclear offer
and generally agreed that in the event of one, they
should make only noncommital statements.
the
Soviets expected the US to propose a reduction of
nuclear-armed missiles some time during this round
of talks. Moscow, in any event, anticipates lengthy
talks on the topic and reportedly doubts that any
agreement on reducing nuclear weapons can be con-
cluded by the end of the fall round of the negotia-
tions.
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SPAIN
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SPAIN
An assessment by the US embassy in
Madrid of Prime Minister Arias' perform-
ance after almost 18 months in office
asserts that he has made little progress
toward his goal of developing greater
popular participation in government.
The problem of how to handle rising
terrorism in the northern Basque prov-
inces has become the most urgent of
the various difficulties facing the
government.
Of four specific promises he made, Arias has
made good on only one--a limited statute on polit-
ical associations. This provision for embryonic
political parties has so far failed to encourage
the development of what Arias regards as Spain's
potential for "real pluralism." The illegal Chris-
tian Democratic and Socialist groups do not wish
to tarnish their future prospects by applying for
legal status now, and moderate reformist leaders
have held back because they have not received guar-
antees of freedom to act.
Arias has stressed that the sine qua non for
liberalization of the political system?Ts- the pres-
ervation of internal order. The government has
reacted harshly to those dissenting groups that
the regime believes are a threat to national unity.
These include groups active in labor, the church,
the universities, and the news media, as well as
proponents of regionalism.
Government efforts to control dissent have
been less than successful, and this has exposed
Arias to attacks from the extreme right. As a
consequence, government leaders appear to waver
between support for the general principles of lib-
eralization and a desire to placate right-wing
forces.
The government has ordered a state of emer-
gency in two Basque provinces where a number of
police have been murdered in recent months. On
the grounds that Basque student protesters have
(continued)
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challenged government authority, Madrid has also
closed several universities in the area. A surge
of right-wing terrorism against Basque separatist
sympathizers in the north, at times with the ac-
quiescence of local security forces, has compounded
the security problem.
In trying to cope with problems of regional-
ism in Catalonia and the Basque provinces, the gov-
ernment has followed a carrot-and-stick policy.
While taking a strong position on preservation of
order, the government has decided to allow basic
instruction in the Basque and Catalan languages.
In dealing with labor unrest, Madrid has not
yet kept its promise to permit free labor unions.
A decree granting the right to strike in narrowly
circumscribed situations was approved last month.
In the light of Arias' record, the belief is
now widespread in Spain that political changes
are not feasible as long as Franco lives. Moder-
ate oppositionists and reformers within the gov-
ernment say they believe Arias is sincere in his
intention to liberalize, but that after more than
35 years of authoritarianism, he either does not
know how to proceed or is unable to act decisively.
6
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FOREIGN REACTIONS TO THE ROCKEFELLER
COMMISSION REPORT
Initial reactions from the West
European media generally combine favor-
able comment on your handling of the
Rockefeller Commission's report with
a sober appraisal of the difficulty of
dealing with the problems the report
has disclosed.
Two leading independent West German papers,
for example, both acknowledge the dilemmas in-
herent in any intelligence organization's attempts
to walk the thin line between responsibility in a
democratic society and the achievement of the ob-
jectives of clandestine service. The Frankfurter
Allegemeine Zeitung notes that "The truth must be
told in an open society...dubious actions on be-
half of the government are intolerable. On the
other hand, intelligence services are not welfare
organizations...the CIA has an important mission
operating for the protection of the US and the
West."
The prestigious London Times commented in
similar vein. While praising the "valuable work"
done by the CIA and urging that it be protected
from "indiscriminate criticism," the paper also
calls for "close and regular scrutiny" to minimize
conflicts between CIA's necessary secrecy and
methods of operation and the "values it exists to
protect."
Several of the still relatively few comments
we have noted see the investigation of the CIA as
part of the overall process of self-examination
resulting from the "US loss of political innocence"
in Vietnam and Watergate. A Munich paper that
makes this observation also notes that CIA is
ideally suited to this "self-purge" both because
it has engaged in activities that cannot stand the
glare of publicity and because it cannot defend
itself.
(continued)
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One respected Italian newspaper alludes to
other revelations still to come while another of
more leftist tendency refers to "the anguished
feeling of insecurity caused by such ferociously
bold wielding of power inside and outside the US
borders."
Concerning the CIA's future, the limited com-
ment thus far available combines endorsement of the
Commission's recommendations with some skepticism
that they go far enough. But there is also the
thought that the Agency needs to get out of the
headlines and, under reasonable controls, get on
with its work.
Preliminary Soviet and East European press cov-
erage of the report has relied heavily on critical
Western commentary. Tass replayed the New York
Times editorials of June 11 and added a brief resume
of the Commission's findings, emphasizing the sur-
veillance of mail to and from the USSR. The Soviet
news agency embroidered a bit, however, by saying
that gross violations of constitutional rights have
long been common in US society.
A Hungarian commentator charged that "leading
circles in Washington" are engaging in a "new
cover-up operation," which would forever conceal
CIA "assassination operations." Moscow, however,
has made no mention of the assassination issue and
thus far has avoided labeling the report a cover-up.
*
The only editorial comment we have seen so far
from Asia is in this morning's edition of the
Bangkok Post, an English-language paper that is
widely read by those educated Thai who are attuned
to international affairs. The editorial reflects
the new nationalism evident among Thai leaders. It
is critical of the Commission for "belittling" the
CIA's "crimes," but asserts that the "one good
thing" is that there was an investigation at all
and that the Senate Committee will continue the
probe.
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NOTES
There is a widespread outbreak of cholera in
Cambodia, and the new regime could be faced with an
epidemic, partly of its own making.
Cholera is endemic to Cambodia, and there was
a serious problem in Phnom Penh before the commu-
nist takeover in April. The communists' wholesale
evacuation of the city--including hospital patients--
created textbook conditions for spreading the highly
infectious disease. Intercepted messages indicate
that the new government is having trouble finding
qualified medical personnel and vaccine to treat
the outbreak. Under normal conditions, interna-
tional efforts could quickly control and isolate a
cholera epidemic. The new leaders are fiercely
xenophobic, however, and may be reluctant to accept
the assistance necessary to bring the disease under
control.
Poulo Wai Island, the scene of recent fighting
between Vietnamese and Cambodian communist forces,
has apparently been captured by the Vietnamese.
According to an intercepted message, Cambodian
forces on the island were "wiped out" by the Viet-
namese in an attack on the night of June 10. If
Poulo Wai has indeed been seized by the Vietnamese,
it probably will not mark the end of armed clashes
between the two forces in the Gulf of Thailand.
Cambodian forces have occupied a number of disputed
islands in the Gulf and now probably will be even
more determined to defend their territorial claims.
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Top Secret
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