President Bush yesterday approved U.S. credit guarantees for Soviet purchases of up to $1 billion in American commodities and proposed giving Moscow medical supplies, expertise in food distribution and other remedies for the collapsing Soviet economy.
Bush said he was attempting "to help the Soviet Union stay the course of democratization and to undertake market reforms" in the face of its deepening economic crisis.
Bush made the announcements in a Rose Garden appearance with Soviet Foreign Minister Eduard Shevardnadze in which the president said they had agreed on a Feb. 11-13 date for the next U.S.-Soviet summit in Moscow. Bush said he was hopeful that a treaty reducing strategic nuclear arms would be ready for signing then.
Shevardnadze expressed appreciation for the aid package, acknowledging a "certain instability" in Soviet society and saying "we are worried about that, that's a fact." But he said the unrest would not lead to civil war and "the Soviet people will cope with our problems."
Secretary of State James A. Baker III, who joined Bush and Shevardnadze in a White House meeting yesterday and met separately this week with the Soviet minister, said "instability in the Soviet Union is very definitely not . . . in the interests of the United States" or the rest of the world.
Senior U.S. officials said they are increasingly worried about the prospect of a shift toward authoritarianism by Soviet President Mikhail Gorbachev. They said the permission for American credit guarantees -- primarily for the purchase of grain -- is an effort to break the sense of rapid deterioration and chaos that has led to massive food hoarding and shortages in Soviet cities.
Bush announced that he had waived the Jackson-Vanik amendment to the 1974 trade act, which limited Soviet access to official U.S. government credit programs because of Moscow's restrictive emigration policies. Bush said he was issuing the waiver because of the recent surge in Soviet emigration, primarily Jews heading for Israel, and "assurances this policy will continue."
The United States has been pushing the Soviet Union to codify its relaxed emigration policy in a new law, but the legislation has been stalled in the Supreme Soviet, or parliament. Although he waived the Jackson-Vanik amendment yesterday, Bush indicated he was not prepared to go so far as to submit the Soviet-American trade agreement to Congress until the Soviet emigration law is passed.
Thus, the Soviet Union will not get a normalized trading relationship with the United States, known as Most-Favored-Nation status, until the Soviet emigration law is passed and the trade agreement submitted to, and approved by, Congress.
The immediate impact of yesterday's decision will be to make the Soviet Union eligible for U.S.-backed bank loans that could be used to buy grain from American farmers. The waiver also will restore Soviet eligibility for Export-Import Bank credits and guarantees for the purchase of American manufactured goods, although such credits remain limited by other U.S. laws.
Bush's waiver will be in effect until next July, and could be extended then.
Baker and Shevardnadze denied suggestions that the aid package unveiled yesterday was a payoff for Soviet help in the Persian Gulf crisis. Shevardnadze noted that U.S.-Soviet cooperation had been accelerating before the gulf crisis began with Iraq's invasion of Kuwait in August, and he hailed "a new relationship" between the two nations.
Reaction to Bush's decision generally was favorable from Congress, Jewish groups and other organizations, but some critics questioned whether the aid might be wasted and whether the United States should be attempting to prop up Gorbachev, whose authority has been waning in struggles with leaders of the Soviet republics and increasingly powerful local entities.
The National Conference on Soviet Jewry and the Union of Councils for Soviet Jews both said that freedom of emigration for Soviet Jews had been significant enough to allow a temporary waiver of the Jackson-Vanik amendment. "While truly free emigration does not yet exist in the Soviet Union . . . we believe that the waiver . . . will be fully consistent" with the goals of promoting emigration, the national conference said.
In Congress, House Majority Leader Richard A. Gephardt (D-Mo.), who was criticized by the White House last summer when he suggested providing aid to the Soviets, praised the move, as did many in the leadership. But Sen. Jesse Helms (R-N.C.) called Gorbachev "the most disliked man in the Soviet Union" and said it was "scarcely a sensible time to give his government credibility and financial support."
Sen. Bill Bradley (D-N.J.) said, "It is a mistake to waive the Jackson-Vanik restrictions in order to allow more subsidies and loan guarantees" because it would not substantially relieve hunger in the Soviet Union.
Israeli Prime Minister Yitzhak Shamir, in Washington this week, said that his government favors suspending Jackson-Vanik "for a year or more" because of the very liberal Soviet policy on emigration. Shamir, who met Shevardnadze last night, told an audience at the American Enterprise Institute, "We think the suspension could be done for a time to help the Soviets with their economy."
In a package of other assistance measures, Bush announced the United States is prepared to send to the Soviet Union this month a special technical assistance team to assess the collapse of the Soviet food distribution system, which many have identified as the major cause of shortages.
He also announced that the United States will propose that Moscow be given a "special association" with the International Monetary Fund and the World Bank, allowing the Kremlin access to the expertise of the global lending institutions. Officials said, however, that this was not meant as a way for the Soviet Union to tap into new lending sources.
Bush also said he would authorize a public-private medical assistance effort to help with immediate Soviet shortages of pharmaceuticals and basic medical supplies.
Officials said Shevardnadze also had extensive talks with Bush and Baker on the strategic arms limitation treaty, which is intended to mandate deep cuts in U.S. and Soviet arsenals of intercontinental nuclear weapons. The treaty, nine years in the making so far, is the major piece of unfinished negotiations on arms control between the superpowers.
Yesterday, Baker said the differences that remain in the negotiations are "very technical" and suggested they include verification, monitoring rocket facilities and missile test data.