561.311F1/156: Telegram
The Acting Secretary of State to the Chairman of the American Delegation to the Monetary and Economic Conference (Hull)
147. For Morgenthau from Wallace. Your 134, July 15, 9 a.m.25 and 135, July 15, 10 a.m.
As to Australia: to prevent uncertainty, I repeat that the Australian proposal to limit their exports and not accumulate stocks is acceptable to us.
As to Danubian countries: we will accept whatever agreement seems reasonable to you and which Bruce will accept. The figures you mention for Danubian exports are quite satisfactory.
As to Russia: We feel it would be wise to include Russia if any plan can be devised which seems reasonable to you and which is acceptable to the other exporting countries. Would a Russian quota of not to exceed 50,000,000 any year, but with the right to store excess from year to year, be attractive to her? You might point out to the Russians that they would receive more total income from 50,000,000 bushels sold on a sustained international market than they would receive from 90,000,000 forced on a demoralized market, and that if this acreage reduction agreement for other exporters can be worked out, they will share in the benefits of a stabilized world market.
Finally, I repeat the suggestion as to including some provision as to world level of prices in the export quota agreements. Perhaps it could be arranged for the Advisory Committee to revise all quotas downward if world prices should fall below some stated figure, or upward if they should rise above some designated price. Will advise you later as to whether for purposes of this conference you should abandon acreage reduction agreements entirely in favor of export quotas. [Wallace.]
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