Memorandum of Conversation, by the Secretary of State

The Italian Ambassador21 called and handed me a memorandum relating to the recent notice to his Government by this Government that countervailing duties would have to be imposed on certain Italian imports unless the Italian Government should see fit to change its policy of subsidizing such exports or pursuing such similar policies as would place the exports under the ban of our countervailing duties law.

The Italian memorandum categorically denied that Italy is subsidizing the exports in question in any way, and expressed surprise at the charges. The memorandum then recited that the Government of Italy would consider it an unfriendly act if these proposed countervailing duties should be imposed; that in addition it would abandon the modus vivendi now existing; that furthermore it would find ways of retaliating by prohibiting American exports to Italy.

When I read the memorandum I remarked that this was a rough statement; that I had brought the matter up in a friendly spirit and urged a friendly settlement of it, to which statement the Ambassador agreed. I said that my proposal had called for a sitting down across the table and the presentation to the officials of each Government of the full facts material to the questions involved, to the end that there might be a frank and friendly determination of the true facts, to the satisfaction probably of each party concerned; that the Italian Government pursues just the opposite course by bluntly denying the charges of subsidizing exports with no proof offered to support the denial; that it then proceeds to announce that this Government will be guilty of an unfriendly act if it does not accept such unsupported denial and withdraw the proposed imposition of countervailing duties; that the Italian Government goes further and threatens to abandon the existing modus vivendi between the two governments; that it goes still further and threatens retaliation generally by prohibiting imports of American goods into Italy. I expressed my surprise at this entirely different spirit from that which I had expected of his Government in reply. I said it would be well for the Ambassador to see whether his Government is disposed to present the facts and evidence in support of its naked denial of subsidizing exports, in order that the two governments might in an amicable way settle, if possible, the question in dispute. He said that he would be glad to take back the memorandum which he had handed me, and it seemed [Page 632] from his statement to contain the substance of despatches from his Government on the subject. I suggested then that he see the Treasury officials and ascertain whether the matter could not be dealt with in a systematic manner rather than by this proposed blunt and gruff method. He said he would communicate with his Government and also confer with the Treasury. I stated to him that I had sent to Ambassador Phillips a copy of the memorandum I read to him some days ago in connection with this matter.

C[ordell] H[ull]
  1. Don Ascanio dei principi Colonna.