500.C1112/171a: Telegram

The Secretary of State to the Consul at Geneva ( Bucknell )

[Extracts]

164. For Thompson from Grady. The following comments upon the draft declaration concerning commercial access to raw materials43 [Page 824] have been prepared after consultation with the Department and with interested individuals.

The Secretariat should be commended for its draft, particularly for the position taken in chapters 1 and 244 and the forceful observations supporting chapter 2.

. . . . . . . . . . . . . .

Careful study would be required to determine the ability of the United States at the present time to assume the obligations of chapter 2. For your background information the mining laws limit the exploration and purchase of public lands of the United States to citizens and those who have declared their intention to become citizens, and the General Leasing Act45 provides that deposits of coal, phosphate, sodium, oil, oil shale or gas may be disposed to citizens or to corporations organized under the laws of the United States, the states or territories, provided that citizens of countries which do not grant reciprocally like privileges may not hold stock in corporations securing such leases. The limitations of the mining laws have been considerably liberalized by court decisions but the situation is complicated by other provisions of Federal law and by the laws of some states denying or restricting the right of aliens to acquire and hold property.

. . . . . . . . . . . . . .

Although the United States is sympathetic to efforts to organize production and marketing efficiently and on a remunerative basis, it is felt that there is need for much more study and specific consideration of the problems created for consumers in connection with international control schemes. It is the opinion here that it would be unfortunate if chapter 346 should be adopted as at present drafted, countenancing insufficiently safeguarded restrictions on the movement of raw materials by international agreement, restrictions which countries might not impose individually under the declaration.

The full participation of at least the principal consuming countries (as in the international wheat and sugar agreements47) appears to be the only method so far suggested that would assure consumers effective representation. The consumers’ panels invited to tender advice to the International Tin Committee and to the International Rubber Regulation Committee fall short of effective consumer representation, [Page 825] firstly because they have no vote or active participation in the administration of the agreements and secondly because only manufacturers, the first buyers of the raw materials, are represented.

The suggestion has been made that the proposed declaration should include an engagement on the part of governments to afford the Secretariat of the League or some agency full and continuing information regarding the subjects covered by the declaration. Should the Secretariat be prepared to undertake this task, it is felt that it might be of great service in centralizing information regarding and study of actual restrictions upon the export of raw materials and the development of natural resources and that it might follow closely the operations of international control schemes.

The limitation of the effect of the declaration to those countries participating in it is in line with the established policy in the United States to extend certain privileges only to citizens of those countries which extend like privileges to American citizens.

Hull
  1. See telegram No. 367, supra, footnotes 41 and 42.
  2. Chapter I, “Prohibitions, restrictions and duties on the exportation of raw materials”; Chapter II, “Development of natural resources”.
  3. Approved February 25, 1920; 41 Stat. 437.
  4. “International schemes for the regulation of the production and marketing of raw materials”.
  5. Final Act of the Conference of Wheat Exporting and Importing Countries, … signed August 25, 1933; League of Nations Treaty Series, vol. cxli, p. 71. International Sugar Agreement, signed May 6, 1937; Department of State Treaty Series, No. 990, or 59 Stat. 922.