CONFIDENTIAL AND GUARD
the White House actually gets through to the President and what does is coloured by the channel. On textiles, Mr. Nixon is
ikeliest to be listening to Arthur Burns, who, in this respect, stands nearer to Mr. Stans than to the State Department, and only. last week told a deputation of retailers, who were urging upon him a more selective approach, that nothing short of comprehensive restraints would discharge the President's commitment. Finally the Administration regard themselves as bound by the President's indication that they should seek comprehensive bilateral restraints from the principal low-cost suppliers. He was presented last July with three alternatives; the other two were a comprehensive multilateral system and selective bilateral restraints, and charac- teristically he chose the middle one. This is what Stans means when he says that the President is resolved on a settlement in this particular manner. He will not shift his position without another decision by Mr. Nixon.
3.
These were the principal considerations which led us to suggest an attempt to influence the President directly by means of a personal message from the Prime Minister. At the time it looked as if things might come to a head very quickly; Mike Daniels and other representatives of Japanese interests here are convinced that the Japanese Government came within an ace of caving in on a comprehensive bilateral after the fact-finding talks in Washington in September. As it is, the steadfastness of the Japanese and the other countries approached for bilateral agreements has gained more time. It is not at all clear how the Americans intend to tackle Mr. Sato next month. There is little sign of any new thinking. A high level meeting a week ago, under Burns' chairman- ship, simply went over the old ground again. Barring some political deal (which we could attempt to prevent only by persuading the President beforehand of the general damage which unwarranted textile controls would do to international trade) my present guess is that Mr. Nixon himself will try to succeed on a comprehensive bilateral where his subordinates have failed. The recent proposals to Taiwan and South Korea seom to confirm this.
4.
If the Fresident also fails, however, I still think we shall be faced with the issue set out in our telegram No. 2714. Against the background described above, it is difficult to feel confident that anybody within the Administration has the will or the strength to persuade the President to go back on his present inter- pretation of his political commitment. As next year's Congressional elections approach, the political pressures on him will grow. It may be that the Administration's propensity to indecision is such that matters would drag on for some time more in the same fashion as they have done for most of this year. But the problem is not going to solve itself or go away any more than it would have done in 1961 if President Kennedy had not concluded the L.T.A. on cottons. Tom Vail, General Counsel to the Senate Economic Committee, remarked the other day to Philip Ridley, with unconscious cynicism, that the textile lobby might not have a case but they had the political muscle. Sooner or later, therefore, either Congress or the
CONFIDENTIAL AND GUARD