Critical Issues Before the Democracy


Robert S. McNamara, 1985

Robert S. McNamara is former President of the Ford Motor Company, Secretary of Defense in the administrations of Presidents John F. Kennedy and Lyndon B. Johnson, and for fourteen years, President of the World Bank. Among the many honors bestowed upon him are the Legion of Merit, the Presidential Medal of Freedom, and the Albert Einstein Foundation Peace Prize. In this interview Mr. McNamara focuses on ways to increase the prospects for a more enduring peace in an increasingly interdependent world.

Whiteley: Mr. McNamara, a theme that has run throughout your writings both as President of the World Bank and as Secretary of Defense are steps to a safer world now and for the 21st Century. Where do you want your fellow citizens to begin their thinking?

McNamara: Well, first I would ask them to recognize that we live in an increasingly interdependent world. That may seem obvious, but if it is, we don’t act as though we recognize that point. What it means to me is that our actions that we may think affect us only locally, have ripple effects that affect the other four and a half-billion people in this world. And if our actions are affecting those four and a half-billion people we should recognize that, and we should ask ourselves what it is we want for not only ourselves and our families and our fellow U.S. citizens, but what we want for the other four and a half-billion people. And what I want for them is to advance their welfare in the most fundamental of terms, to advance their dignity as human beings. That’s my objective. How we get there perhaps, we should focus on that.

Whiteley: Okay, let’s try to break it down and first talk about the relationship with the Soviet Union. You’ve had extensive contact with them over three decades. What do they think of us?

McNamara: They fear us.

Whiteley: Why?

McNamara: They’re deathly afraid of us. Well, let me just give you an illustration. I recall the figures of strategic nuclear warheads in 1960; it was at the time that the presidential campaign was being in part focused on the so-called "missile gap." But at that time we had 6000 strategic nuclear warheads - now that includes bombs as well as missiles - The Soviets had 200. and we were claiming in the campaign - as a matter of fact it was the Democratic candidate to whom I later served as Secretary of Defense - who claimed that there was a "missile gap", that we were falling behind, that the Soviets clearly had a superior force, and undoubtedly would plan to use it either militarily or for political blackmail. Now he claimed that with the best of intentions on the best available knowledge. It happened to be erroneous knowledge, and I mention this only to say that we are constantly exaggerating the strength of the Soviets, we are constantly attributing to them aggressive tendencies. More recently we have attributed to them evil actions, evil intentions. And yet at the same time they see us with this immense power today, literally today, measured in terms of strategic warheads, and that’s a very simplistic measure, I realize that. But measured in terms of strategic warheads we have superiority: 11,500 to their roughly 8500. Now I say superiority in numbers. It does not give us superior military power, but they see us constantly moving in ways to build up force which they fear we will utilize against them to their disadvantage. So that’s the first thought they had was fear.

Whiteley: They also have argued historically that they will bury us, they’ve argued for an expansionist doctrine, they’ve taken Marxism and Leninism and quoted that they want world domination.

McNamara: They introduced missiles into Cuba in October ‘62. Everything you said is true. And what would you do if you felt inferior and fearful?

Whiteley: I would build and prepare.

McNamara: And that’s what they’re doing. And don’t misunderstand me, I’m not naive about the Soviets. I was Secretary of Defense when they sought to take Berlin; I was Secretary of Defense when they introduced missiles into Cuba. And in each case we came very close to going to war because in the interest of the West, we could not tolerate their aggressiveness. But I submit to you they were driven to it in their minds by a feeling of weakness and by a belief that we were building the superior power which we then had to use in aggressive ways against their society. They have never forgotten Hitler’s surprise attack on them and the fact that it cost them twenty million dead.

Whiteley: Given the fact they have been invaded in two wars, we have also joined in two wars with them to try to make the world safer from a totalitarian despot. What has to happen to change their thinking?

McNamara: We must deal with them more consistently. We must have a consistently firm, but still flexible policy of dealing with the Soviets. We have not done so. We’ve been very very volatile in our relationship. One day we’re kissing them as friends, and the next day we’re treating them as enemies. That does not build the kind of a relationship that will lead to long-term peace between our societies. We must deal with them firmly, but we must deal with them flexibly. And when I say firmly I mean we must maintain a position of strength. I don’t believe that the Soviets wish large scale war with the West. I’m certain they don’t. And God knows we have no intention of attacking the East. But I do believe they will probe for weakness. We’ve seen much evidence of that in the last quarter century. I think they’ll continue to do it in the next quarter century. So the first requirement is firmness. But the second requirement is flexibility: engagement, dialogue on trade, on political relationships, on security matters.

Whiteley: In talking about an interdependent world we began with the Soviet Union. Let’s move now to our allies. Our principal allies in the present time include some of our adversaries in World War I and World War II, but this has been a pattern of relationship that has existed since World War II. What are our necessary actions with our allies...

McNamara: Again, to recognize common interest, and to treat them as equals. We would be much better off if Europe was stronger politically and economically vis-à-vis the United States. They have come a long way. We together, the North Americans and the Europeans, and I would say Japan as well, have come a long way in the last two or three years to recognize our common interests, and to address them in a way that is advantageous to all of us. It is a plus-sum game as are so many of these international situations. We benefit economically if Western Europe advances. The Marshall Plan is a perfect illustration of that. Think how much better off we are today that Europe is strong economically, and that our trade with them is as large as it is, and that together we are able to take advantage of our technological advances. All of this has brought us tremendous increases in material wealth. Think how much better off we are that we have NATO, a security pact, that unites the West in its position of firmness vis-à-vis the East. So I would suggest that the number one objective with respect to our allies must be unity of purpose and unity of action in support of that common objective.

Whiteley: You spent nearly eighteen years as President of The World Bank where your responsibilities moved into another part of the interdependent world, namely to developing nations. What are your insights about the path to peace based on that experience?

McNamara: Well, first let me say that it’s commonly accepted in the United States that security is a function of the defense budget. I don’t believe that. Security is a function of much more than military hardware or, for that matter, total dollars spent on the defense budget. Security is a function of what we think of ourselves for one thing, confidence in our society. It’s a function of our economic strength, it’s a function of the unity of the West, and it’s a function of stability or instability in the developing world. I recall as Secretary of Defense testifying in support of what was known as the Military Assistance Program, which is a program of providing financial aid to countries in the Third World in order for them to protect themselves. And at that same time before the same committee, other parts of our government were arguing for economic assistance to those developing countries.

At that particular time in the 60s military assistance was a much more popular program than was economic assistance. But I said to the committee Chairman, and to the members of the committee, at the margin we would buy more security for this country by transferring a dollar from military assistance to economic assistance. I said that because I believe that economic advance, social advance is a necessary foundation for political stability in these developing countries. And I don’t wish to suggest that so long as economic and social advance occurs there will be political stability, but I do want to suggest that if there is not economic advance, and there is not social advance, there will be political instability in the Third World. And political instability in the Third World has ripple effects that involve us, and if our audience doesn’t believe it I just direct their attention today to Central America and Nicaragua.

Whiteley: Be specific. What is that relationship? Take Central America ...

McNamara: Well, take Central America. It’s a very interesting case to me because today we are in effect describing the cause of the disorder in Central America, and God knows there is ample disorder in Nicaragua and Salvador and some of the other countries there. We’re ascribing it to Soviet and Cuban intervention. And they are involved, there’s no question of that. But the basic cause, the underlying cause, the reason why we are in difficulty in Central America is that the leaders of particularly those countries that are in the news, Nicaragua most notably today, for decades the leaders of Nicaragua were insensitive to the interests, the needs, the welfare of the mass of their people. And finally that insensitivity led to a coup, led to them being overthrown, and as is typical under such circumstances, political disorder developed and at that point the Soviets and the Cubans took advantage of the, in a sense the vacuum of order, and introduced their own forces and their own instruments of power into that vacuum.

But the Kissinger Commission was I think quite right when it pointed out that the initial problem was a failure of the elites of those societies to govern in the interest of the mass of their people. It’s in our interest to help these nations govern themselves in such a way as to advance the social and economic welfare of all of their people. If that is not the case, political disorder will develop. We’ve seen it in Africa - we’ve seen much more of it in Africa; we’ve seen it in Central America - we’ll see much more there. And political disorder in one part of the world, given the interdependence that exists today, is very likely to have ripple effects that affect other parts including our own.

Whiteley: What are the responsible steps our democracy can take to assist? Let’s go back to Central America.

McNamara: Well, the first point I would make is you can’t help those who won’t help themselves, and if a nation is unwilling to introduce the macro-economic polices and the political and economic institutions that are necessary to help itself then no amount of outside assistance, technical or financial, will be of value.

Whiteley: What are those - before we leave it - what are those institutions?

McNamara: Well, there must be a sensitivity to the welfare of all of the people, and not a set of institutions that simply advance the privileged position of a small number of people. But there are still many countries in the world where the governments are protecting an elite at the cost of advancement of welfare of the mass of the people. If a government persists in that course of action, there is very little that we or any other Western power can do in provision of technical assistance or financial assistance, do to help that society. But I want to emphasize that the great majority of the governments in the Third World, the great majority of the nations in which exists some three and a half-million people today - a great majority of those governments are moving in ways to enhance the welfare of the mass of their people. They need our help. They need our technical help and they need our financial assistance.

Whiteley: Okay, what are the forms of technical help, and then financial assistance, that make a difference?

McNamara: Well, in many of these countries the most important single thing we can help them do is to expand their production of food. Now that is not simply a matter of applying agricultural science because one must have an economic environment that is conducive to maximizing food production, and that means appropriate incentives, it means proper relationships between the price the farmer receives for his product and the cost of his seeds and his fertilizer and his water, and whatever else he needs to produce it. And if that cost/price relationship is not what I’ll call appropriate, if it doesn’t provide the farmer proper incentives, no amount of agricultural science will expand food production in that area.

So an appropriate macro-economic policy is absolutely essential. There needs to be proper institutional forums; you need to have what in this country we call agricultural extension services, means of taking down to the small farmers the technology: what seeds to plant, when to plant, what fertilizers, pesticides, water to apply. And then there has to be a means of providing for, I’ll call it collection of the surplus product, and the distribution of that into the cities or into the export markets or in some fashion to compensate the farmer for producing the surplus. But these are actions - I call them technological forms of assistance - which we are fully capable of providing, and which when provided yield amazing results.

Let me illustrate a point. I know many in this country question whether India has advanced. Well, I want to suggest to you, in ways far beyond anything we could have expected, and I’ll give one illustration that relates to just what we were talking about. Between 1967 and 1977, adjusting for differences in weather so we’re dealing with a common weather environment, India more than doubled its cereal grain production from roughly 70 million tons in ‘67 or ‘68, to something on the order of 150 million tons in 1983-84. That is a tremendous advance. It expanded its cereal grain production more rapidly than its population increased, and therefore, grain production, food production per capita increased. And in a society where tens of millions, if not hundreds of millions of people are living literally on the margin of life, there is nothing more fundamental than increasing food production per capita. India accomplished it. Now she did it primarily through her own initiatives. By establishing macro-economic policies, institutional forums that contributed to that. But external financial assistance, relatively modest, was absolutely essential. Without that external financial assistance she would not have been able to accomplish that tremendous economic advance.

Whiteley: A concern you’ve written about extensively in the last decade has been the need for population controls. How is that related to the long term needs for peace?

McNamara: Well, let me speak of a specific country and try to address your question in terms of that country. This country in terms of population and the relationship of population growth to the growth of food production, for example, is typical of really all of sub-Saharan Africa, in which live about 350 million people. The country is Kenya. And I mention Kenya because I happen to recall the figures. In 1980 its population was 17 million. It was growing at a rate at something in excess of 4%. The average female during her reproductive years had more than eight children. A growth rate of 4% resulted. That meant the population would double every 17 years, and therefore, Kenya’s population of 17 million in 1980 will within the next 40 years, the lifetime of many of us and certainly of our children, will quintuple; it will grow from 17 million to 80 million, and it will not level off even under optimistic assumptions about future reductions in fertility, will not level off below about 150 million. Now, in 1980, at 17 million, there was an imbalance between population and arable land, between population and food production. True, the productivity of the arable land could be increased, but there could be very little addition to the land under cultivation, and to increase the productivity would be difficult. And almost certainly, it will not increase as rapidly as the population will increase.

As a matter of fact, in sub-Saharan Africa as a whole, between 1970 and 1980 (in that decade) per capita food production fell 1.1% per year. Now that was because of an imbalance between population growth on the one hand, and cereal grain production on the other. Now what was the result? Well in Kenya, as we all know, two years ago there was an attempted coup; it didn’t succeed but it indicated the degree of unrest. Now I don’t want to suggest that every example of political disorder or social unrest in the world is a function of lack of economic advancement, and certainly not in every case a function of excessive rates of population growth. But excessive rates of population growth, and I say Kenya’s an illustration, and I return to Central America to make the same point there, excessive rates of population growth do contribute to social and political disorder.

Whiteley: In asking you to reflect on steps to a more peaceful world, you began with an analysis of our interdependence. You talked about the need for technological assistance, you’ve talked about the need for financial assistance, you’ve talked about the need for population control, providing the country has in place, what you call, the macro-economic system that would put that to work. On a nation-by-nation basis we still operate in a worldwide system of independent nation states, albeit some brought together in loose alliances. What are the viable means of world relationship over the future?

McNamara: We must move toward a greater degree of integration of our economic and political decisions. Today we’re operating with Western Europe, and more broadly with other nations of the world - there are roughly 150 countries in the world - we’re operating as though, or in an analogous way to what we’d have in this country if we had fifty states, each with their own money supply, each with their own central bank, each with their own set of trading barriers and trading rules; with no federal reserve system establishing a common fiscal policy, no federal reserve system adjusting interest rates, no ability to maximize employment in the society as a whole. We must move over the next several decades, not toward a one-world government (we’re not going to have that any time in the lifetime of our children, grandchildren, or great grandchildren, I’m sure; nor would I suggest that it’s even desirable), but we must move toward greater integration of our economic policies.

What is going on today is insane. We in the United States, the richest nation in the world, because of our mismanagement of our finances, are penalizing other nations. We are borrowing from the other nations. The richest nation in the world is borrowing at the rate of roughly 120 billion dollars per year to finance our consumption and our investment. That can’t continue indefinitely. It’s not only uneconomic in the very real sense, it’s immoral. And when we develop macroeconomic policies, in this case this huge fiscal deficit which drives up interest rates, causes the dollar to be overvalued, draws in imports, penalizes our exports, the only way that can be sustained is by concurrently borrowing from the rest of the world to pay for these imports that are exceeding exports by something on the order of 120 or 150 billion dollars per year. As I suggest, that cannot continue indefinitely. It shows on our part a total insensitivity to the need to integrate our macro-economic policies into the policies being followed by the other nations of the world, particularly the developed countries of the world.

Whiteley: Given the fact that in your analysis we’re not going to have a more peaceful interdependent world until some of these problems are solved, and world government isn’t realistic ...

McNamara: It certainly is not.

Whiteley: Then we come back to the need to take sensible steps as a democracy to work toward a more interdependent world and solve some of these problems.

McNamara: A more interdependent world, yes.

Whiteley: What are the mechanisms that will work?

McNamara: Well, I think - well, I may have sounded pessimistic. I don’t wish to leave you with that impression. I think we’re making progress. In the first place, in the last three to four years there has been a tremendous increase in, I was going to say the power, and perhaps I should say the function and the influence of the international monetary association. And I think that is very much to the good. The International Monetary Fund is, as you know, an organization of which roughly 150 governments are members, and it seeks to finance imbalances in balance of payments, and at the same time to monitor macro-economic policies of both developing and developed countries. It has not yet developed a really effective means of monitoring the policies and forcing change in the policies of some of the major powers, for example the U.S. But it has certainly prevented bankruptcy in the last three or four years of many of the very large developing countries, including many in Latin America.

And when you recognize, and this I want to indicate is another measure of the interdependence that exists in the world, when you recognize that the nine major money center banks in the United States - the City Banks, the Chase, the Bank of Americas, etc. - the nine major money center banks have loans outstanding to five of the Latin American governments equal to 150% of their capital. Now imagine what would happen to our banking system in this country if these five major Latin American countries were unable to service those loans. Our financing system would freeze up; not only would we be able to loan to foreign governments, we’d be unable to loan for domestic purposes. So it was absolutely essential that the solvency of these, in this case these five Latin American countries, be assured. The International Monetary Fund was the agency that stepped up to the problem.

Whiteley: Mr. McNamara, thank you for sharing with us today your insights into the relationship of the interdependence of the world to the long-term search for peace.