Memorandum by the Under Secretary of State (Phillips) of a Conversation With the Canadian Minister (Herridge)

The Canadian Minister talked to me at length today in regard to the necessity of doing something to stimulate trade relations between Canada and the United States; he referred to Prime Minister Bennett’s visit to Washington last spring and to the public statements made along these lines; he said it was high time to move forward in this respect; he had not pressed the matter because he was well aware of the emergency program undertaken by the N. R. A.12 and felt that Canada should not interfere with the remedies which the American people were putting into effect to find a solution for their own economic difficulties; he felt, however, [Page 52] that a point had been reached where there was now a parting of the ways—if the American tariffs against Canadian imports were raised further; that there was bound to be further retaliation in Canada against the United States; in these circumstances it was essential to make an effort now to work out an exchange of commodities on a reciprocal basis which would turn the tide away from a complete stoppage on the Canadian border; he had not in mind a reciprocal trade agreement, necessitating submission to the Senate, but rather the selection of a few items which, by an exchange of notes, could be facilitated entrance. The Minister asked that we consider the idea of asking the Tariff Commission to study the 50% reduction of tariffs on potatoes, lumber, cattle and fish and in return he could promise facilitating the entry into Canada of American vegetables and fruits, farm machinery and other manufactured articles. He felt sure that the Tariff Commission would consent to a 50% reduction because of the similarity in the costs of production in both countries; Mr. Herridge felt the need of creating some machinery which would start trade moving; it need not be very important; it might well be limited to three or four items from Canada; the point which he had in mind was to make a start in the right direction and, once reciprocity was established, other items would normally be added.

W[illiam] P[hillips]
  1. National Recovery Administration.