811.24 Raw Materials/88

Memorandum of Conversation, by the Adviser on International Economic Affairs (Feis) to the Assistant Secretary of State (Sayre)

Baron de Gruben18 came in this morning. The visit was undoubtedly induced by the extensive stories in the press regarding the Byrnes project19 for exchanging surplus stocks of wheat and cotton for reserve stocks of strategic raw materials. It will be remembered that when the Prince de Ligne was in this country, the possibility was discussed with him and formed one of the items of the exchange of correspondence which took place between the Secretary of State and the Belgian Ambassador (in fact my belief is the consultation held with Secretary Wallace20 at that time to ascertain whether the Department of Agriculture had the legal authority to dispose of its wheat and cotton surpluses in this way was the origin of the whole project).

Baron de Gruben in his usual systematic fashion went over the various pieces of legislation now in Congress having to do with the acquisition by purchase of strategic raw materials. He then reviewed the newspaper accounts of the Byrnes project. I gave him such background as seemed useful and suitable, and acquainted him fully with the statement that had been put out by the Department. I emphasized to him the fact that the contemplated exchanges had to do solely with the accumulations of permanent reserves and in no way affected ordinary commercial dealings on the trade agreements program.

He then asked whether the discussion of the subject held with the Prince de Ligne could be regarded as the beginning of an interchange [Page 441] with his Government. I replied that such was the underlying intention and that the form in which the matter was expressed in the memorandum which the Prince de Ligne had taken with him21 was responsive to our present ideas. I stated that we had not pressed the discussions further because we were waiting to give the Prince de Ligne time to consult other interested branches of his Government, and also for the present confusion of the atmosphere to become less.

However, I said I am sure the Secretary of State would be glad if he could see his way clear to cable to his Government and convey the general background which we had just reviewed and to ascertain whether the matter, as expressed in the memorandum which the Prince de Ligne had taken with him, was of interest to his Government. He said he would do so.

I informed him in response to his further inquiry that we had not undertaken discussions with any other Government up to the present.

H[erbert] F[eis]
  1. Baron Hervé de Gruben, Counselor of the Belgian Embassy.
  2. James P. Byrnes, Senator from South Carolina; for text of Senator Byrnes’ proposal, see Department of State, Press Releases, April 15, 1939, p. 297.
  3. Henry Wallace, Secretary of Agriculture.
  4. Not printed.