841.796/10–2044
Memorandum of Conversation, by the Assistant Secretary of State (Berle)
Mr. Michael Wright came in to the office at his request and handed me the attached memorandum, not as an aide-mémoire but merely as an indication of what he was thinking about. He said it was clear to him that there was a head-on collision between the British insistence on power in an international body, and the American refusal to accept it, and that being so, a half-way house would have to be found. Though he did not say so, it was evident that someone in the British Foreign Office had cabled him indicating that the mere collision of views accomplished nothing, and that some compromise had to be found. (Note: This is exactly what Lord Beaverbrook told me when he was here, and conforms to the outline of the instructions Prime Minister Churchill gave Lord Beaverbrook in my presence.)
Passing to specific questions, Mr. Wright asked whether we would be prepared to accept a scheme of rate-fixing. I said we would be prepared to discuss a scheme of minimum rates. Mr. Wright then asked what international machinery could fix these rates. I said that our minds were open on this subject but that the most practical method appeared to me to be an operators’ conference analogous to the so-called “conference rates” fixed by ship operators. Mr. Wright thought there might be objection to leaving so much power in private operators, and that Government intervention might be necessary. He thought that possibly an international body or committee might exercise such power. I said I thought that the best we could expect was that it should exercise its good offices—that is, possibly act as a forum in which such a conference could be held. Suppose, said Mr. Wright, they fail to agree. I said I thought the danger was that they would agree on rates that were too high. If ballasted by a general understanding that any country would discipline its lines if they indulged in rate wars, I thought we had power enough to deal with the situation.
He then asked about the limitation of frequencies. I said the American position was in favor of unlimited frequencies; though we would be prepared to discuss some method by which empty planes were not shuttled across the world at huge expense. “Could not an international body regulate these?” asked Mr. Wright. I said I thought not. If an arrangement were dependent on facts—as for instance, given a schedule of frequencies, anyone could increase his frequencies only after his planes ran full for say ninety days—the [Page 564] increase in frequency would depend upon a fact, namely ninety days full loading. A central international organization might be the recipient of traffic reports which would determine these facts, just as the old ICAN97a received traffic reports.
Mr. Wright then raised his third point: equitable distribution of frequencies. I said that this was a point I could not discuss intelligently because no one had remotely suggested what “equitable distribution” might mean. If it meant artificially attempting to shift traffic, we were against it, lock, stock, and barrel. If it meant that matters should be so handled that no one was excluded from the air and there was reasonable opportunity, that would mean something else. Our fear was that, under cover of equitable distribution of frequencies, there would simply be an attempt arbitrarily to divert traffic from the lines by which it wanted to travel to the lines of somebody else who wanted to make some money or serve his national interest by it.
Mr. Wright said he thought there might be some principles worked out. I said I thought so too, and if, instead of talking distribution of frequencies, we tried to talk actual facts, the subject would become less complicated. For instance, it might be agreed—and our theory was—that the routes had to be routes by which the country seeking them connected itself with other centers of traffic—rather than less flown routes by which planes of some country or other undertook to compete for traffic between a couple of other countries, and so forth. Again, when routes were asked from say New York to Athens via London and Paris, the frequencies of that route ought to be adjusted to the whole length of the route, and not stepped up for the sole purpose of permitting that line to gauge its activity by the heavy London-Paris traffic. I said that when these matters were actually worked out, I thought that the so-called equitable division ceased to be as much of a problem as it appeared.
To the question of how small countries were to be protected, I said that we had already stated our intention of making planes available on non-discriminatory terms. Thus no one was precluded from getting into the air by reason of our transient monopoly of planes; though I frankly would not consider this transient monopoly to amount to very much since other countries would certainly move as rapidly as they could.
Mr. Wright left saying that he thought that a little more work along these lines would probably make possible an understanding, and therewith we left it.
It was understood that the foregoing was entirely on a personal and exploratory basis.
[Page 565]Wright said that Magowan of the Embassy would be going out to the Air Conference.
- International Commission for Air Navigation.↩