856D.6176/229: Telegram
The Secretary of State to the Ambassador in Great Britain (Bingham)
166. Your 204, April 26, 4 p.m.37 The British reply does not substantially lessen the Department’s doubts regarding the rubber restriction plan as outlined. Therefore please in your inquiry Monday put forward again the points conveyed to you in previous instructions, emphasizing particularly the extreme desirability of getting the assurance that would be conveyed by some specific price protection in some form or other (you may make it clear again that this Government is not seeking to bring about any particular arrangement for price protection by merely seeking the assurance of having some definite know-in-advance price protection arrangements), in the absence of which this Department fears speculative price movements and injurious price situations. If the American consumer of rubber has no explicit protection, how can he be expected to feel assured in the face of restrictive arrangements the operation of which is completely [Page 657] at the discretion of a small committee drawn from the producing countries. Emphasize also the fact that the arrangement merely for a panel of consuming interests to tender advice to the committee from time to time seems inadequate both for the purpose of assuring consumers a full knowledge of the plan’s operation and also to carry out the obligations assumed by His Majesty’s Government under section (d). This Government regrets that it must continue this exchange of contentions. If the plan is put through as it stands at present, the British Government must not be surprised if critical opinion forms in this country. This Government would regret such an eventuality and is anxious to avoid it. It appears that the two Governments are in substantial agreement as to the desirable objectives of the rubber plan and this Government hopes some way can be found to reach agreement on those details of the plan which would be of importance in obtaining the objectives.