611.5131/999: Telegram
The Secretary of State to the Ambassador in France ( Straus )
419. Your 745, October 12, 5 p.m. We have been approached during the past few days by Laboulaye and Garreau-Dombasle proposing an early initiation of discussions for a reciprocity tariff agreement. Laboulaye told me that his Government was ready to make some real concessions at this time if the United States could take up negotiations at an early date. He added that he did not know what the situation might be 6 months hence. Garreau-Dombasle was more specific with Feis. He said that he had returned from France encouraged with the possibilities and stated that French Government was prepared to proceed with negotiations on a wide front. He thought for example that the French Government would be willing to concede the minimum tariff rates throughout their whole schedule. He implied that the present discriminatory turnover tax could be abolished and that the [Page 180] double taxation treaty would be passed.30 These he said were indications of the French attitude. In return he sketched the nature of the concessions which France would seek, primarily decreases in duties on a small list of commodities of which he enumerated champagne, handsewn gloves, laces.
We have had several conferences in the Department to consider what our next step should be and asked Howell31 to come down from New York and join us. The impression we have had from your telegrams is that by delaying an agreement to negotiate, we could obtain better terms from the French. If Garreau-Dombasle accurately reflects the French Government’s point of view, we feel that they have already reached a state of mind where they are prepared to make satisfactory concessions and that early negotiations would preclude the imposition of new trade barriers.
We eventually worked out a proposed reply to Laboulaye, which Howell believes to be in line with your views.
Laboulaye is coming in to the Department Monday morning. Our suggested approach on which we should like your comments is in brief as follows: (1) Explain to him that we are much interested in possible treaty discussions with France, but that the program of negotiations with other countries, for which we have already accepted commitments, is very heavy and that it would be extremely difficult to undertake exhaustive discussions with the French Government at the present moment.
(2) That however if the French Ambassador were in a position to indicate to us in general the limits towards which the French Government would be prepared to go, and it would seem to us that negotiations of broad and outstanding importance were possible, then we might be warranted in interfering with our present program. In other words, only the prospect of reaching an agreement with France that would clear up many important obstacles to trade between us and lead to a growth of that trade, would justify the disturbance of the present program that would be required.
(3) Without making the passage of the double taxation treaty a sine qua non to the inception of negotiations, we feel that it should be ratified by France at the earliest possible date. The treaty is one which we could not bring into commercial negotiations nor could we admit its use by the French Government to obtain a further quid pro quo. We should remind Laboulaye of the note of July 31, 193432 from the French Minister of Foreign Affairs stating that delay was due merely to an overcrowded agenda of their Parliament.
[Page 181]To sum up; our whole purpose is (a) to make it clearly a matter of record that the initiative has come from the French, and (b) to satisfy ourselves a good deal further that the French are really prepared to make serious and genuine concessions with a view to concluding a treaty.
Please be quite frank in your comments, which however should reach us at the opening of business Monday morning.