740.00112A EW/8–944: Telegram
The Ambassador in Chile ( Bowers ) to the Secretary of State
[Received August 10—11:30 a.m.]
1332. For Swihart from Russell. There are two questions with reference to Department’s 889, August 8, 4 p.m.
[Page 183]First is question of policy with respect to withdrawal of lists which will actually be carried out following close of hostilities in Europe. Second is form of announcement if any to be made at this time.
With respect to first intention to date has been that list of worst offenders in Europe and Argentina should be continued for approximately a year for purpose of inflicting serious economic damage upon firms thru depriving them of Allied markets during vital post war period. Continuation of the lists against these firms for a period of only a few months would not accomplish this purpose. On other hand I do not believe it will be either expedient or necessary to continue the lists for the longer period of time against firms in South America. In all probability great majority of worst times [sic] will have been dealt with by local controls. There would probably be no difficulty in continuing the lists for a “short period” i.e. for a few months but such a period would not accomplish the principal purposes in Europe. Furthermore if the Department desires to apply economic sanctions against Argentina continuance of the lists for Argentina after withdrawal from rest of countries in Western Hemisphere would constitute an effective sanction.
With respect to second question I recommend strongly that any statement which may be made make no specific reference to probable withdrawal of lists for countries in this hemisphere. One of the strong inducements for action by other American Republics to deal with spearhead firms at this time is their desire to come within the terms of the May 4 statement, i.e., withdrawal of the lists for countries far removed from the scene of conflict where spearhead firms have been eliminated.76 Any statement that the lists would be withdrawn regardless of the elimination of spearhead firms would seriously undercut present efforts to bring about such elimination. I believe, however, that this elimination will have proceeded so far by close of European hostilities, in almost all countries except Argentina, that withdrawal of the lists for the Western Hemisphere generally (except Argentina) will be justified. In absence of indication of reason for consensus that it would not be desirable to continue lists for Europe and Argentina while removing them in Western Hemisphere, I recommend that any statement currently to be issued, adopt with respect to countries in Western Hemisphere substantially same language as that used in the May 4 statement. [Russell.]
- This phrase is from the penultimate paragraph of Mr. Russell’s address of May 4, 1944, printed in Department of State Bulletin, May 6, 1944, p. 405.↩