740.00112 European War 1939/5419: Telegram
The Secretary of State to the Ambassador in the United Kingdom (Winant)
Washington, June 8,
1942—4 p.m.
2594. For Riefler from Perkins: With reference to your no. 2428 and 2496 and Embassy’s no. 2455 regarding preemption of Swiss industry, Board of Economic Warfare preliminary views for your guidance in possible discussion with British and Swiss are as follows:
- 1.
- The relative power position of the Axis in Switzerland, both
militarily and economically, is so strong that effective
interference with Axis procurement by means of a United Nations
preemption
[Page 389]
program
seems doubtful. A general preemption program would have to take
up a significant amount of currently unemployed labor and
productive facilities before affecting those employed in Axis
war production. Support of Swiss production envisaged by you
would require large shipments of industrial raw materials which
- A.
- Are strategic and in short supply in the United Nations.
- B.
- Would be dangerous to send from, a blockade point of view.
- C.
- When manufactured could not be exported and would tempt Germany to seize from storage.
- Germany can prevent diversion of Swiss industry from Axis war production by means of its control over Swiss exports and control over all Swiss imports including essential supplies of fuel and other materials from Germany which could not practically be replaced by the United Nations.
- 2.
- Support of Swiss military production depends upon importance
attached to Swiss army by the joint Chiefs of Staff. Latter have
informed Board of Economic Warfare that increased Swiss army
strength need be given little weight in determining export
policy. It is doubtful whether
- A.
- Increased military production would interfere with Axis production.
- B.
- Germany would permit a shift in military balance of power which could be prevented.
- C.
- Military potential of Swiss army could be sufficiently increased by equipment alone to provide any more effective power or will to resist aggression than now exists.
- 3.
- If discussions are held with the Swiss on this subject, our
views are that preemption of specific key plants now working for
Axis would be the most effective. Preemption must deprive Axis
of skilled labor, equipment, etc., now being used or which would
be used in the future. Purchase of free list articles, such as
watches, or non-free list goods, such as machinery for storage,
would not be preemptive.
- A.
- If coming from large stocks on hand.
- B.
- If merely tending to reduce the heavy enemy imports of civilian goods, such as watches, from Switzerland.
- C.
- If purchases caused employment of labor and equipment at present unused and which would not be used for enemy war production.
- Reports from Switzerland indicate that some factories are operating below capacity due to material shortages.
- 4.
- Any agreement as to preemption would require provision for American civilian surveillance of production, storage, and consumption of goods, especially if we supply raw materials. [Perkins.]
Hull