611.4731/205a: Telegram
The Secretary of State to the Consul General at Sydney ( Moffat )
Do you think it would help the Australian Government to find a way out, when it is ready to alter its policy toward the United States, if we should now or soon propose the conclusion of a most-favored-nation arrangement, either a treaty, a modus vivendi, or simply an exchange of notes. Our note would point out that we have such arrangements with 53 nations; that we have witnessed such vindication of the principle of most-favored-nation treatment to all nations, with or without contractual arrangements, that we are desirous of putting the principle on a more formal basis with the remaining few nations with whom we have no contractual arrangement, and that we would be glad to enter into discussions with Australia looking to an arrangement covering inter alia the treatment of commerce and the entry and residence of businessmen.
It seems to us that such a proposal, while carrying no hint that this is a step toward ultimate negotiation of a trade agreement, might drive home the thought that the very first step toward such an end would have to be equal treatment of our commerce. On the other hand, for saving face there, Gullett could rationalize upon the fact that “The United States Government made the first move”. Would the latter eventuality be harmful?