665.1115/11: Telegram
The Secretary of State to the Ambassador in Italy (Long)
17. Your 42, February 1; 46, February 3, and 49, February 5.14 I am greatly interested in doing whatever is possible to further an agreement which will result in increased trade with Italy.
I do not feel fully informed regarding the facts involved in the cotton proposal; my understanding is that Italy proposed to take annually 500,000 bales of American cotton and we in return annually to take 200,000 metric tons of raw silk at a fixed price, presumably above the market price. I am prepared to consider any plan that appears feasible, but the nature and details of the plan would be all [Page 521] important. If the arrangement carried definite obligation to purchase up to a given quantity of raw silk, irrespective of whether the market absorbed it naturally, I suppose that some agency of the American Government would have to engage to buy this silk and to distribute it. Any such arrangement, as you know, would present difficulties not easily met. Again, in the terms of such arrangement we would have to guard carefully against sacrificing our market for raw cotton in Japan in order to assure it in Italy. The proposal involves approximately doubling imports of raw silk from Italy over imports made in 1933. Our principal purchases of raw silk are made in Japan from which we buy over 20 times as much silk as that bought from Italy. Japan is the largest market for American cotton and there will be nothing gained if the Italian arrangement resulted in a curtailment of Japanese purchases. For these reasons, very careful study would have to be given to all phases of a possible arrangement.
I am very anxious also to increase the volume of trade between the United States and Italy at the earliest possible date by means of a general trade agreement and the sooner an effective agreement can be concluded the better I will be pleased. We have already commenced detailed studies with regard to Italian-American trade and hope to complete them at the earliest possible moment. As you know, under the law it is impossible to sign a trade agreement until after public hearings are held at which time American interests will be given an opportunity to present their views and position. Public hearings have already been announced for March 11, and briefs must be presented before March 4. Such public hearings must be held irrespective of whether the agreement may be limited to only a few commodities or be of a comprehensive nature embracing trade in general between the two countries. As you can readily understand, it would be embarrassing if commitments, even of an informal kind, were made in advance of such hearings since we would be open to the charge of not having given American interests an opportunity to be heard and the opposition of the protectionist element in this country cannot be lightly disregarded.
In view of the whole situation I desire to have your own views and your concrete ideas as to how we should proceed in the light of the foregoing in order to come to an effective agreement for increasing trade between the two countries at the earliest possible moment. I also think it would be most useful if you will endeavor to secure from Mussolini or his officials their own ideas or suggestions as to what can be done.
[Page 522]I think you will readily realize that our situation here is such that no publicity should be given to your discussion in Rome. Please keep me fully informed in the matter.
- No. 49, February 5, not printed.↩