561.311F1/65: Telegram
The Secretary of State to the Consul at Geneva ( Gilbert )
70. For Morgenthau. The Secretary of Agriculture instructs you as follows:
The report is in general satisfactory.
You may proceed to negotiate on Monday an agreement between the four exporting countries providing for reduction of acreage to begin with the crop planted in the fall of 1933 and the spring of 1934 below the base of acreage actually planted in 1932 or below the average acreage for a short term of previous years. The selection of the base period gives you a bargaining latitude.
An acreage reduction arrangement calling for 12½ per cent reduction from the base year for each of 2 years would be suitable to this Government. If you find, however, this is definitely unacceptable, cable me.
The continuation of the agreement during the second year should be made contingent upon securing satisfactory agreements from the importing countries for relaxation of restriction of wheat imports.
The recommendations of the report as to arrangements with the importing countries, the continuing committee, Danubian agreements, and possible subsequent Russian participation are approved.
The Counselor of the Canadian Legation17 in Washington Friday discussed this subject with myself and Haas. The Canadian Government is uncertain as to whether it can undertake any policy of acreage reduction. I understand from other sources that the present Canadian administration is under pressure from the prairie provinces18 to enter into a reduction arrangement, however, and could not afford to take the blame for making agreement impossible if the three other countries favor acreage reduction.
The President has told me that an agreement along the preceding lines would be a good start for the Economic Conference.
You will of course not finally commit this Government to any agreement without referring back for further instructions and furnishing texts.