800.8890/752
Memorandum by Mr. Alger Hiss, Assistant to the Adviser on Political Relations ( Hornbeck )88
Memorandum for Mr. Hornbeck
Subject: Relationship of shipping provisions in the Neutrality Act89 to suggested replacement of British merchant vessels in the Pacific by United States vessels—possible effect of such replacement upon Chinese imports of arms and other munitions.
The press has recently suggested the possibility that American merchant vessels might take over the Pacific routes now maintained by British lines, thus freeing British tonnage for Atlantic shipping needs. If this proposal is to be given serious consideration—especially if British-controlled shipping (i. e., Norwegian, Dutch, Belgian, Greek, et cetera) is to be included in the shipping to be “replaced”—thought should be given to its possible effect upon Chinese imports of [Page 593] arms, ammunition, and implements of war. This problem will be discussed in the remainder of this memorandum.
Section 2 (a) of the Neutrality Act of 1939 provides that it shall be unlawful for any American vessel to carry any passengers or any articles or materials to any state named as a belligerent in any proclamation issued under Section 1 (a). Burma is included within the proclamations by virtue of the naming of the United Kingdom in the applicable proclamations. Section 2 (g) provides in effect that section 2 (a) shall not apply to transportation to any port on the Pacific or Indian Oceans by American vessels of any materials except arms, ammunition or implements of war. Under these provisions no American vessel may transport any arms, ammunition or implements of war to Rangoon, the only seaport through which China can now receive supplies from the outside world.
It follows from the above situation that so long as Section 2 (g) remains unamended, each American vessel which may replace a non-American vessel in the Pacific area will ipso facto eliminate a potential or actual carrier of arms to China. Care should, therefore, be taken, in connection with any replacement of British Pacific shipping with American vessels that may develop, to see that sufficient non-American shipping is left available for the transportation of arms to China from China’s various suppliers of such goods.