611.4731/188a: Telegram
The Acting Secretary of State to the Consul General at Sydney (Moffat)
We contemplate asking Ambassador Bingham25 to hand Mr. Eden a message to be transmitted to the Government of Australia. The draft text of that message is submitted to you below with request for telegraphic suggestions from you as to both text and channel of communication.
“The Government of Australia in communicating to the Government of the United States its reasons for discriminating as between imports from the United States and those from other foreign countries stated in summing up that it was compelled to do so because of [Page 768] conditions which threatened the Australian financial position. Its communications contained also assurances of friendship which transcend economic considerations and expressed the hope that its point of view would be sympathetically understood.
“The Government of the United States has therefore entertained the fullest confidence that the Government of Australia would make its expression of friendship more articulate by more favorable treatment of American commerce when it became evident that the economic crisis which was then apprehended shall have been safely passed.
“Since it had then as always the most implicit confidence in the economic and financial stability of Australia, the American Government is particularly gratified now to be able to point to new conditions which must indeed have already caused the Government of Australia to reconsider its policy.
“First of all the present satisfactory price of wool and the substantial rise in the world price of wheat should have contributed appreciably to security against pressure upon Australia’s balance of international payments.
“In the second place, the Commonwealth budget statement of September 10, 1936, contains gratifying evidence of the healthy condition of Australian national finance. The Government of the United States notes with interest that both the figure for estimated excess of receipts over expenditures and the figure for remission of taxes far exceed the figure of £2,290,000 which appeared to the Australian Government in May to be so vital to Commonwealth finance as to have been the cause of drastic discriminatory action against the commerce of the United States.
“But the most important of all recent developments from the point of view of assurance as to Australia’s economic future is the issuance of the recent statements by the Governments of Great Britain, France and the United States regarding international monetary policies,26 and the rapid succession of adherences to these policies by other nations. No areas in the world stand to benefit relatively more from efforts to place the principal currencies upon a sound and more stable basis than do those devoted to the production of staple raw materials, whose markets are closely affected by world monetary conditions.
“The attention of the Government of Australia is drawn particularly to that part of the British statement which is similar to those of the other governments jointly initiating this move, which urges strongly that action be taken without delay to relax progressively the present system of quotas and exchange controls with a view to their abolition.
“The Government of the United States takes this occasion to express its gratification that the representative of Australia at the League of Nations, in supporting a draft resolution under discussion before the Second Committee on October 6,27 expressed faith in the economic policies and aims of the Government of the United States, and its hope that Mr. Bruce’s declaration represents the present sense of the Government of Australia.”