811.04418/99: Telegram
The Minister in Switzerland (Wilson) to the Secretary of State
[Received 5:30 p.m.]
362. Your 507, December 28, 4 p.m. to Paris. My thoughts expressed in general fashion are set forth in the two drafts enclosed in my letter of November 29 to Dunn.9
To summarize, I feel strongly that any legislation beyond that affecting arms and implements of war should be subject to the discretionary power of the President. Finite minds cannot conceive all possible developments and/or provide a wise course in advance. Only a measure of suppleness and wisdom on the part of the Executive can guide and interpret public opinion and prevent an explosion that rigidity of law might bring about.
More specifically: Point 1. An embargo on all export trade to belligerents would cause undue suffering on the part of our people and if the present conflict were extended might cause a diminution of international trade which would bring about an internal economic crisis and arouse widespread discontent among our people. This danger is peculiarly evident when we contemplate the possibility of 50 odd states of the League involved in hostilities arising out of the application of sanctions with one aggressor.
Further, I feel that our economic needs parallel the path of political wisdom and that we should not take a step which, if the conflict were extended, would risk the alienation of our friendly relations with those states with whom we would be unable to maintain such relations.
Point 2. What I have set forth in respect to point 1 is applicable, though in lesser degree, to point 2.
Respecting point 3, under two conditions I believe the establishment of such legislation would be distinctly helpful. The conditions are (a) that it should be discretionary on the part of the President and (b) that your studies have shown that such legislation is practicable from an administrative point of view.
Although I feel that there is something shocking to the public conscience in making abnormal profits out of war, I see no reason why the existence of a war should necessarily cause losses to American business men. Swollen profits would bring about swollen credits and an inflation of which experience has shown us the danger. The continuance of normal business would not, with few exceptions. The states of the League that undertake sanctions do so under their obligations of the Covenant. We are under no such obligations to suffer [Page 173] losses. Our sole objects are to remain neutral to avoid entanglement and independently to formulate a new method of neutrality consonant with present conditions.
I am impressed by a political reason for preventing increases in trade in war key products beyond the normal flow. If we do not do so the states applying sanctions may feel driven to establishing a blockade. In this event they will hold us responsible if bloodshed follows.
Certain additional provisions might be advisable if at the discretion of the President: (a) An authorization to enlarge the category of “key products” to be held down to normal quantities; (b) a prohibition on loans and credits to belligerents; (c) a warning that travel on belligerent ships and trade with belligerents is at the risk of the individual. Such provisions would be helpful both in minimizing the danger of our being involved in some form and preventing an abnormal situation of production which would risk a second financial crash.
Cipher text to London, Paris, Rome, Berlin.
- James C. Dunn, Chief, Division of Western European Affairs; letter not found in Department files.↩