561.311F1 Advisory Committee/1066: Telegram

The Ambassador in the United Kingdom ( Winant ) to the Secretary of State

6255. For the Secretary and Assistant Secretary Acheson. Please read in connection with my message No. 6174, December 22, 6 p.m.13 I have had further discussions with the Foreign Office on the Wheat Meeting and am now in a position to give you further information on the British attitude.

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As a result of three series of interventions on my part with the Foreign Office in the last 3 months the Wheat Meeting has been the subject of detailed consideration by Cabinet committees on three separate occasions which have examined it not only from an agricultural viewpoint but also from the point of view of its relation to other economic policies and to political questions concerned with the entire war effort and the peace that will follow.

It has been made clear to me in the last week that the Foreign Office feels that the issues in the present wheat discussions have not received close consideration by an equally authoritative and representative Government group in Washington. The British feel that these issues have been left for the most part to those concerned with them primarily or exclusively from an agricultural point of view and that they have not been examined in a sufficiently comprehensive manner with consideration for all their ramifications with respect to war policy and post-war economic policy of the two countries as a whole. I am not supporting this position but merely relating it.

Next the Foreign Office takes exception to the statement in my memorandum of November 11 to the Foreign Secretary that “the United Kingdom delegation lacks authority to discuss price.” This statement was based on following passage from page 6 of the Department’s telegram 5738, December 6, midnight:

“The difficulty, however, in discussing prices with the United Kingdom delegation is that they have no authority under their present instructions to discuss the matter and have refused so far to recognize the necessity … of an agreement in regard to prices.”

Commenting on this, Richard Law, Under Secretary of State, says that “while it is the case that the United Kingdom delegates were not authorized to discuss a price formula for publication now there was very full discussion of the price question in general. And I think that the terms of the note which you left here were perhaps a little harsh towards us in this respect.”

The Foreign Office has also expressed some dissatisfaction with the treatment of the price question on the ground that while a new price formula was telegraphed to them by Salter at the end of November, it has not been made clear to them how far that formula has the formal support and approval of the Governments of the four exporting countries.

The Foreign Office is still concerned over the position of non-signatory countries and especially Russia. It does not consider that governments in exile can be brought into the agreement usefully particularly because it is too early yet to determine what postwar economic boundaries will be decided on by the countries of central and eastern Europe. One Foreign Office spokesman referred also to postwar [Page 556] France and Germany and expressed the view that the cooperation of these countries would be important in the long run to the successful working of a wheat agreement and might be prejudiced if arrangements were reached now which might after the war be interpreted by them as an attempt to impose conditions on them.

The Foreign Office is not opposed to the principle of policing imports in accordance with quotas agreed on by the exporting countries, and will definitely engage to do so in the case of countries represented now and those which may enter at a later stage. Its central argument is that it is one thing to police quotas agreed to in a conference after mutual consultation between the exporting countries participating on an equal basis and another thing to fix percentage quotas for countries which cannot be represented now and place an advance obligation on Britain to police such quotas.

On the question of import barriers and artificial measures to foster wheat growing, the Foreign Office spokesman said that Britain had no intention of raising import barriers. After further discussion they implied informally that Britain might not be averse to a general declaration in favor of reducing import barriers and of discouraging artificial fostering of domestic wheat production by other methods provided a qualification were inserted in regard to wheat which was thought necessary for purposes of maintaining a rotation system. It seems that further progress might be made on this point.

I have had some informal private discussions with the Australian Government representatives in London. They are not at all enthusiastic about the price formula or any method of rigid linking of price changes to an index number. They said that Government economists and others most opposed to the Hudson policies in Agriculture had expressed regret to them that they were forced into the Hudson camp in opposition to a wheat agreement because of the dislike of these price formulas. But the Australian Government representatives here are cooperative and anxious to help to obtain agreement. They do not consider that wheat is necessary in the rotation system referred to and seem to think that some compromise might be tried on quotas of nonsignatory countries.

Finally, I am assured that the British Government is prepared to sign the agreement on a relief pool of wheat proposed in revised article 7 of the provisional draft wheat agreement.

I will send you some further suggestions and information on this subject the first of the week but I wanted you and Mr. Acheson to know some of the thinking and reactions here on the proposed wheat agreement. As I understand it the next Conference meeting will not be called until January 7.

  1. Not printed.