PART I: 1971--THE WATERSHED YEAR--AN OVERVIEW PART I: 1971--THE WATERSHED YEAR--AN OVERVIEW This is the third Report of this kind which I have made to the Congress. It comes after a year of dramatic developments. The earlier Reports set forth fully this Administration's analysis of the world situation. They expressed the conviction that new conditions required fundamental changes in America's world role. They expounded our conception of what that role should be. In short, they foreshadowed a transformation of American foreign relations with both our friends and our adversaries. For three years, our policies have been designed to move steadily, and with increasing momentum, toward that transformation. 1971 was the watershed year. The foundation laid and the cumulative effect of the actions taken earlier enabled us to achieve, during the past year, changes in our foreign policy of historic scope and significance: This Report is addressed to those and other developments. It is, however, a companion piece to the two earlier Reports, for without an understanding of the philosophical conception upon which specific actions were based, the actions themselves can neither be adequately understood nor fairly judged. This account of a year of intense action, therefore, properly begins with a brief review of the intellectual foundation on which those actions rest.
--An opening to the People's Republic of China;
--The beginning of a new relationship with the Soviet Union;
--The laying of a foundation for a healthier and more sustainable relationship with our European allies and Japan;
--The creation of a new environment for the world's monetary and trade activities.