601 



ports of raw materials. But technology transfer on a long-term basis 

 must also be assessed in terms of political costs and benefits. An inter- 

 esting aspect of both the grain sales and the natural gas negotiations 

 is the suggestion that the Soviet Union may now be receiving prefer- 

 ential treatment in U.S. foreign trade policy. The Soviets purchased 

 U.S. grain at a price that was lower than warranted by the world 

 market situation, and the price which has been mentioned for U.S. 

 purchases of Soviet natural gas seems high. Is preferential treatment 

 for the Soviet Union justified by potential diplomatic gains for the 

 United States? . 



The following are among the political costs of the new commercial 

 relationships: 



1. The risks involved in the unreliability of the Soviet Union as a 

 supplier of important raw materials. Reliance on the Soviet Union as 

 a source for vitally needed energy resources appears to be a particu- 

 larly risky undertaking. 



2. Contributions to the Soviet fund of technical knowledge that 

 could be translated into security programs or which could result in 

 the release of resources for military programs. 



3. Potential leverage to the Soviet Union that could result from So- 

 viet control over U.S. investments and personnel — a possible source 

 of economic blackmail, or an economic hostage system. 



The following are some of the political benefits : 



1. Soviet reliance on the United States as a source of supply and ex- 

 pertise. Soviet dependence on U.S. agricultural products and ad- 

 vanced technology, for example, is a potential source of U.S. political 

 leverage. 



2. Encouragement to the Soviet Union to reorder priorities between 

 military and civilian programs. Expanded commercial relations may 

 serve as an economic reinforcement of the arms control and other 

 agreements between the two countries. 



3. Encouragement of domestic change in the Soviet Union. The 

 presence of many American citizens in the Soviet Union with some 

 decisionmaking power and a wider exchange of ideas may in the long 

 run contribute to a moderation of the Soviet political control system 

 and command economy. 



In summary, expanded economic relations which facilitate massive 

 technology transfer from the United States to the U.S.S.R. may create 

 new, potentially dangerous dimensions in U.S. diplomacy. On the 

 other hand there is at least a possibility that the process of integrating 

 the centrally planned Soviet economy into the market economy of 

 the United States and the rest of the non-Communist world might un- 

 leash irreversible forces of constructive change which could, in turn, 

 contribute to international interdependence and stability. 



Concluding Observations 



POLITICAL, GAINS LIKELY TO OUTWEIGH ECONOMIC BENEFITS TO 



UNITED STATES 



The volume of Soviet trade with the United States by any projec- 

 tion is not likely to represent a large share of U.S. trade or GNP. 

 Economic advantages to the United States are likely to be centered 

 on such specific sectors as imports of petroleum and natural gas, and 



