The Acting Secretary of State to President Roosevelt96

My Deak Mr. President: In connection with our program of promoting the closest possible economic relations with the other American republics, we are proposing, if you approve, to renew trade-agreement negotiations with Chile.

Copper is one of the principal products on which we might grant a concession to Chile. You will recall that in October 1939 a public notice was issued of intention to negotiate a trade agreement with Chile, followed by an announcement in December of that year withdrawing copper from the negotiations; and that this announcement was decided upon as a result of vigorous protests from the smaller domestic producers and their representatives in Congress. The negotiations with Chile have since been inactive.

The copper situation today differs radically from that existing a year or more ago. Defense and normal civilian needs now far exceed domestic production, and we are importing as much as possible from Chile and other American countries. I understand also that it is proposed to subsidize production in high-cost domestic mines. However, even under present conditions, it may be anticipated that there would be political opposition to a reduction in the copper tax.

The Secretary believes that you will probably wish to pass particularly on the political aspects of a new public notice of intention to negotiate a trade agreement with Chile involving the possibility of a reduction in the copper tax. He suggests also that you may wish to consult with the Federal Loan Administrator and others who are familiar with various aspects of the present copper situation. As the matter is one that the Secretary feels will require tactful and forceful handling, he wishes to be assured of your active support of any action which may be taken.

Faithfully yours,

Sumner Welles
  1. The original was returned to the Department with the notation: “S. W. OK but talk with J. Jones. FDR.”