And Moscow had seen nothing yet. The first half of 1982 was merely the start of Reagan’s assault on the Communist infrastructure of the USSR. The second half of 1982 would see the economic attack on the Soviets rise to unprecedented levels.
During the summer of 1982, Reagan redoubled his efforts to block the construction of the Siberian pipeline, an endeavor in which he had the support of his NSC, DOD, and the CIA. The Departments of State and, predictably, Commerce, did not want to obstruct it; likewise, Congress faced considerable pressure from American business, which wanted a piece of the action, as a number of companies saw a chance to make big profits by helping to build the project.
Secretary of State Al Haig feared that U.S. allies could not be brought along as participants in the obstruction, and that any attempt to lean on them would only result in alienation. Moreover, he told Reagan that he had spoken with “experts” on the Soviet Union who maintained that it was “crazy” to think the United States could “bust” the USSR through this kind of economic warfare. Sure, said Haig, the USSR was in trouble, but its system would not be changed by economic means.3 Instead, the secretary of state suggested a compromise: the administration could acquiesce to the pipeline in exchange for an agreement to consult with U.S. allies on restricting future technology transfers to the USSR. In other words, America and its allies could (at some point) look for future cooperative means to deprive the Soviets of key technologies.
Haig’s offer did not sit well with Reagan and those united with him in his effort to undermine. Lou Cannon makes clear that it was Reagan himself who was the primary obstacle. Reagan, reported Cannon, was “intransigent,” dedicated to the “quixotic goal” of halting the pipeline, and was “naively convinced that he could talk the allies out of an economic decision they had already made by warning them of the danger of depending on the Soviet Union.”4
In addition to wanting jobs from the pipeline construction, Western Europe also desired the lower natural gas prices that promised to flow from the USSR. As a result, the White House tried to conceive other natural gas options for Western Europe to entice it away from the pipeline. Even Reagan himself went so far as to lay out publicly other natural gas possibilities, saying in an interview that the White House would work with Western Europe to investigate sources of energy closer to home. He pointed to the North Sea, Norway, and the Netherlands. “We would be happy to help them with the development of those,” offered Reagan.5 Later, he added another alternative, saying that his administration was “taking steps domestically to improve our competitiveness in coal exports to Europe.”6
While Reagan used many rationales to combat the pipeline, his main argument was that Western Europeans would assume two principal risks as primary customers of Soviet natural gas: they could become dependent upon the Soviet Union for a precious resource and, by extension, could position themselves to be blackmailed by the USSR at some future point.7 This was no imaginary product of Cold Warrior paranoia. In fact, Western Europe was already highly dependent on Soviet natural-gas supplies, and the successful completion of this project could result in Europe becoming 50 to 70 percent dependent on Soviet supplies within ten years.8 Reagan repeatedly warned Western Europeans that this dependency would leave them vulnerable to Soviet blackmail. Roger Robinson, the NSC staffer who was one of the chief architects of the economic assault, stated: “We feared the USSR would not hesitate to use the spigot to compromise NATO and Europe politically through this subterranean flow of energy.”9
Worse, Reagan felt it was tragically selfish that Western Europeans might proceed with a project that helped themselves but prolonged the captivity of their Eastern European neighbors, which would remain satellites to Moscow as long as the Soviet system existed. The pipeline would nourish the Communist economy and allow it to continue; those Westerners would be selling their Eastern brethren down the river.
And yet, they were undeterred. Western Europe was willing to help the Soviet Union—and thereby boost the Soviet economy—so long as Western European firms could reap profits and citizens could spend less on natural gas. “The consensus in Western Europe was that economic appeasement of the USSR should continue,” said Roger Robinson, who worked round the clock to help Reagan and Bill Clark block the pipeline. “However, we had a president and a national security adviser who weren’t Atlanticists and weren’t playing that détente-oriented game anymore.”10
Reagan applied a favorite parable to this situation. He was fond of the quote in which Lenin had allegedly said that when the time came to hang the capitalists the capitalists would vie with each other to sell the Communists the rope.11 Reagan vowed to be one capitalist who would not sell the rope. One of his oft-told lessons was a story about a large factory known as the Kama River truck plant, which the Russians reportedly could not have built without U.S. financial and technological assistance. Motors made in the Kama plant ended up in Soviet armored personnel carriers and assault vehicles. This was a Reagan fear, made more loathsome when the U.S. bureaucracy was complicit in the malfeasance, as he believed had been the case with the Carter State and Commerce departments in the Kama deal.12 Reagan refused to see his administration, State and Commerce included, complicit in a pipeline deal that helped the Soviets at U.S. expense. Reagan later recounted how he spent 1982 trying to tighten the noose around the pipeline and the Kremlin:
Throughout most of 1982, I tried to persuade our European allies to restrict credit to the Soviets and join us in imposing other sanctions aimed at halting construction of the trans-Siberian natural-gas pipeline. I eventually had a little success. I was unable, however, to persuade them to apply as much economic pressure on the Soviet Union as I thought we should to accelerate the demise of Communism; many of our European allies cared more about their economic relationships… than tightening a knot around the Soviets.13
At the time, Reagan was getting confirmation during NSC briefings of what he long believed: Soviet Communism was on the precipice, and simply needed the right pokes and prods.14 He said as much openly in an interview with the editorial board of the New York Post. “I think the economic signs are there,” he said of the Soviets. “They are in deep trouble, and so are their satellites.” Thus, he explained, it was important that America and its Western allies “curtail” credit to the Soviets “because I think they’ve run out of hard cash and they economically are very vulnerable right at the moment.”15
This was not the prevailing view, and Reagan was belittled for saying such things. Harvard’s Arthur M. Schlesinger, Jr. declared after a 1982 visit to Moscow: “Those in the U.S. who think the Soviet Union is on the verge of economic and social collapse, ready with one small push to go over the brink, are…only kidding themselves.”16
TIME TO “TAKE A STAND”
What really riled Reagan was the willingness of Western Europe to help the Soviets while a crackdown on Solidarity was underway. Lech Walesa, after all, was in prison—a metaphor for the whole of the Communist bloc, a living martyr. As the Poland situation festered, Reagan reviewed his options. He was bucked up by a persuasive, well-timed two-page memo written by Richard Pipes (urged by Norm Bailey) and handed to Reagan by Bill Clark on the morning of May 24, shortly before a definitive NSC meeting.17 That memo seemed to further convince him to hang tough. In his diary later that evening, Reagan wrote of the NSC meeting that day: “We had a session on sanctions [over Poland], limiting Soviet credit and the Versailles [June economic summit] meeting. There was a lot of talk about… our allies. I firmly said to hell with it. It’s time to tell them this is our chance to bring the Soviets into the real world and for them to take a stand with us, shut off credit, etc.”18 The French, in particular, would hear none of this. On June 15, the Washington Post carried an exclusive front-page interview with the French president. The article, pointedly titled “France Refuses to Wage Economic War on Soviets,” began: “France will reject efforts by the Reagan administration to enlist Western Europe in a campaign of economic warfare against the Soviet Union, President Francois Mitterand has declared.” The Post reported that Mitterand was prepared to cooperate with the United States in “defensive measures” against the Soviets, such as, for instance, “to contain their ambitions.” However, he “firmly” rejected an offensive strategy based on trade and financial restrictions intended to “undermine” Soviet strength. “We are not going to wage any kind of war on the Russians,” declared Mitterand. “You have to be serious about such a course. It could lead to a real war. If economic embargo is a first act of war, it risks being caught up by a second. No, it is not the right move.”19