Guns and butter, clarified

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Cyrus Vance, recent US secretary of state, has done all of us a service by identifying coolly, lucidly, accurately the reasons for what has been bothering a lot of his fellow citizens about their country's place in the world.

If you have not yet done so, I recommend a careful reading of the speech he made at the Harvard graduation ceremonies this spring. The full text was printed in the New York Times June 6.

For example, there is a decline in US ability to influence events around the world. Why? Mr. Vance notes two major reasons:

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* ". . . by 1985 world demand for oil is likely to outstrip global oil production by two million barrels a day."

* "Productivity in the United States declined in every quarter of 1979 after the rate of increase in our productivity had steadily slowed over the previous two decades."

In other words, US economic vitality has been slowing down for a long time, indeed for 20 years.

One result of declining productivity has been a trade deficit. In spite of that deficit the US has continued to be the world's heaviest importer and user of oil, thus hastening the day when there will be a shortage of oil for everyone. Continued importation of oil plus the continuing trade deficit has fueled the inflation which in turn further damages the US economy. The weakening of the economy undermines US influence with other countries, particularly with the allies who are all threatened with oil shortage by the high rate of US consumption.

Inflation and declining productivity also make it more expensive to try to keep up with the Soviets in military weapons.

Right now there is a rising demand, particularly on the election year hustings, for regaining US military superiority over the Soviets. Mr. Vance calls this ". . . a pervasive fallacy that America could have the power to order the world just the way we want it to be. It assumes, for example, that we could dominate the Soviet Union -- that we could prevent it from being a superpower -- if we chose to do so."

That fallacy, he says, has "more to do with nostalgia than with present-day reality." Why?

Because, says Mr. Vance, "it is naive to believe that they [the Soviets] -- any more than we -- would willingly accept a position of second best in military strength."

In other words, in the years ahead there will be two global superpowers, the US and the USSR, of roughly equal strength and range of influence. "We must preserve and manage a position of essential equivalence with the Soviet Union." But if the US cannot convert equivalence into superiority then what is to be done?

Mr. Vance's answer is that the US must direct its long-term efforts toward achieving "a strong American economy in a strong international economy." That means heavy emphasis on improving relations with the allies. This in turn depends on curing the inflation, curbing excess use of oil, "a higher rate of capital investment," "a willingness to shift from obsolete industries instead of propping them up with protectionist trade barriers."

This world, says Mr. Vance, is no longer in the "good old days" when the US was the only true global power. "The international diffusion of power" is the new fact which will not go away. The US must learn to come to terms with this new and diffuse world. It will require, he says, more than just keeping up with the Soviets in military power. There must also be a return to diplomacy in order to "limit the costs, and to increase our safety." Mr. Vance wants SALT II ratified because "without this treaty both sides will have more nuclear weapons than with it. In particular the Soviet Union will have thousands of additional warheads."

But above all, according to Mr. Vance, the US must regain its economic health in cooperation with its allies in order to build "a strong American economy in a strong international economy."

Obviously, this speech is the distillation of Mr. Vance's three years as head of the State Department. It explains why he resigned over the unsuccessful resort to military power in Iran. It is written partly because, in his opinion, "it is far too easy, in an election year, to let what may seem smart politics produce bad policies." But it ends on an optimistic note.

"If we are prepared to accept the implications of a world of diffuse power, and work with others where we cannot succeed alone, there need be no insurmountable barriers to our progress."

In my opinion it is the finest, most balanced, and most perceptive discussion of US foreign policy since the great days of Acheson and Dulles.

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