The chairman of Dresser Industries, the worldwide energy equipment company at odds with President Reagan over his embargo against the Soviet-West European natural gas pipeline, said today that the administration's policy is wrong and unfair to his company.
"Our position is that we don't take lightly throwing our people out of work on the basis of some gesture that seems important to somebody on the Washington scene--whoever he is," said J.V. James in an interview at Dresser's corporate headquarters in Dallas.
Blaming the dispute on politics, James said, "I think they've been looking to get somebody for political reasons. We feel the company is being used improperly . . . . If someone sets out to make an example of Dresser , I get irritated."
Dresser became an unwilling player in the diplomatic dispute between the United States and its European allies on Monday when the French government ordered Dresser's subsidiary, Dresser France, to ship three compressors to the Soviet Union. The French government also told Dresser France to resume work on 18 additional compressors ordered by the Soviets.
Senior Vice President Edward R. Luter indicated tonight that Dresser would fight back in court if the administration acts against it. Earlier, he said Dresser had decided it would temporarily back away from its legal battle in the hope that Reagan would pull back from stopping U.S. companies or their foreign subsidiaries from participating in the pipeline project.
"We'd like for him to find a nice, easy excuse to get out of this and have it all go away and be forgotten," Luter first said.
When asked last night about reports that Reagan has decided to act against Dresser as soon as shipment of the compressors begins, Luter added, "If it does happen, I'm going to be amazed for several reasons. One, we're not in violation of any U.S. law or order. Secondly, it would be completely ineffective with respect to completion of the pipeline. Thirdly, if you cut off Dresser's exports, or any part of them, you are simply creating more unemployment and more of a deficit in the trade balance."
With the company facing penalties, including the denial of export licenses, James indicated there was no desire among Dresser officials to give in. "We're in a dilemma, there's no doubt about that," he said. "But we don't take these things lying down, and we're not going to on this. We've been known to dig in our heels."
Company officials said the three compressors were likely to be loaded today or Thursday and shipped on Friday. The shipment would defy a presidential order barring use for the pipeline of equipment manufactured by foreign subsidiaries of U.S. companies or foreign companies operating under license to U.S. companies.
Dresser faces blacklisting, the denial of export licenses and other penalties if the compressors are shipped. Dresser does virtually no business with the government, but denial of export licenses could cut into the roughly $1.5 billion in foreign sales recorded by Dresser last year. The company, which had sales of $4.6 billion overall last year, employs about 57,000 workers in 100 countries.
Luter said Dresser has been in "almost constant communication" with State and Commerce department officials and had gotten the impression on Tuesday that by backing away somewhat now, Dresser might make it easier for the administration to find a diplomatic solution to the dispute. He said Dresser officials were heartened by reports that a U.S. delegation would go abroad to attempt to find a diplomatic solution to the dispute.
"I don't think the Europeans will back down," he said. "I think the administration has to find some way, some excuse to back down."
Dresser failed on Tuesday to obtain a temporary restraining order that would have prevented the administration from penalizing the company. U.S. District Court Judge Thomas A. Flannery ruled in Washington that Dresser had not proved it faced "immediate and irreparable harm" if the order were not issued.
"We have not violated" the law, Luter said. "We did everything we could to comply with the order."
He said that when Reagan extended the sanctions in June to include U.S. subsidiaries and licensees, Dresser officials in Dallas sent a letter to the French subsidiary ordering it to shut down work on the compressors, which had been ordered by the Soviet Union in September, 1981, at a value of $18 million-$20 million. "We have not rescinded our order to Dresser France, so we have not violated any U.S. law," Luter said.
He added that the order of the French government to ship the compressors is "apparently" not subject to appeal and violation of it could result in jail sentences and fines for officials of Dresser France.
"Dresser France did not make a choice, it did not say it was going to honor the French government and to hell with the United States," Luter said. "It was presented with an order. . . . There was absolutely no alternative."
"These are sovereign nations," added James. "We can't say, 'Hey, we ignore the laws of the land' " in France. He added, "At this stage, the United States doesn't set the law for the rest of the world."
Luter said the mood at corporate headquarters this week has been one of "frustration" at being caught between the Reagan administration and France. Many company officials are strong supporters of Reagan and Luter called him "the most effective president we've had since FDR."
"Business is business and politics is politics," he said. "Naturally, you like an administration that is doing good for the country and the company. I think generally this one is. Every president makes mistakes . . . . But we wouldn't do anything to embarrass him and his administration. We really like them."
Four years ago, Carter administration officials debated whether to block an order Dresser had won to build a drill bit plant for the Soviets before Dresser was allowed to complete the project. At the time, Bechtel Corp. executive George P. Shultz criticized the Carter administration for "light-switch diplomacy."
Dresser officials hoped that Shultz, now secretary of state, would help them in the current dispute. But earlier this week, Shultz dismissed the analogy as irrelevant, saying he "fully supported" Reagan's action on the Soviet gas pipeline.