651.113/131: Telegram

The Acting Secretary of State to the Ambassador in France (Straus)

210. Your 332, July 20. The French market is so thoroughly blocked off by quotas, exorbitant quota license fees, high duties, sales and turnover taxes and discriminations against American commerce, as to make appear highly improbable that there has been any appreciable influx of American goods into the French market because of the depreciation of the dollar. Furthermore general American commodity price levels have increased in a proportion greater than the depreciation of the dollar. Is there anything to indicate that an unreasonable influx of American goods has taken place or is likely to take place?

I feel that unless it can be factually proven that the depreciation of the dollar has brought about an unreasonable influx into the French market of American goods the imposition of an exchange surtax by France will be without justification, and can only be looked upon as unreasonable added tariff protection against American commerce.

I do not take seriously the suggestion that the imposition of such surtax is necessary because of any British protests. The British protested this surtax long before the depreciation of the dollar and maintained at that time that the mere levying of this surtax was a discrimination against British trade.

Unless you feel that it would be unwise, I suggest that you make clear to the French either orally or in writing our position in this matter.