The Foreign Economic Administrator (Crowley) to the Secretary of State

My Dear Mr. Secretary: Almost since the first landing of our troops in Sicily FEA has been sharing the financing of civilian supplies called for by the War Department for the liberated portion of Italy and FEA funds are now responsible for, a substantial part of the total supply burden there.

The War Department calls for supplies in accordance with a policy laid down by the CCS. This policy, as the Civil Affairs officers concerned have stated, and as FEA officials in Italy and Washington have agreed, while probably adequate for a brief emergency period, is in the long run, extremely limited, with disastrous economic effects for the Italians and dangerous repercussions for the foreign policy of the United States.

On September 26, 1944, the President and the Prime Minister issued a joint statement37 on policies toward Italy, which clearly indicated a [Page 1222] supply policy for Italy broader than that heretofore followed by the CCS and in line with the policy of the United States toward liberated areas as outlined in Secretary Hull’s letter of January 1, 1944 to Secretary Stimson.38 To date, however, except for the inclusion of communication and transportation equipment in the civilian supply program, there has been no alteration of the existing supply policy in accordance with the economic aspects of the principles set forth in the joint statement.

During recent weeks, British representatives have presented to the U. S. side of the CCAC39 a declaration of policy toward Italy, drawn by Mr. Harold Macmillan, which represents the view of the U. K. government and its interpretation of the meaning of the joint statement, for the purpose of redefining the combined policy of both governments toward Italy. In considering this British declaration the War Department has taken a position which instead of representing an improvement of the present standards, except with respect to transportation and communication equipment, would perpetuate the old policy, in the economic field, and which is moreover considerably narrower than the British interpretation of the joint statement.

The FEA has indicated its disapproval of the War Department view. However, at a recent meeting between the British representatives and representatives of the U. S. side of the CCAC, of which the FEA is not a member, on the subject of the British draft, the War Department view was presented as the U. S. position. This government was as a result placed in the position of advocating for Italy a much more restricted and less realistic supply policy than the British.

I feel that it is urgent that an agreement be reached between State Department, FEA and the War Department, which will define the U. S. economic supply policy in regard to Italy, in such a way as to take into account not only the limited and temporary interests of the War Department but the long-range responsibilities and interests of the U. S. as a whole.

Sincerely yours,

Leo T. Crowley
  1. Joint statement by President Roosevelt and British Prime Minister Churchill released to the press following their conversations at Hyde Park, N.Y., September 18 and 19, 1944. For text, see telegram 205, September 27, 1944, to Rome, Foreign Relations, 1944, vol. iii, p. 1153; also printed in Department of State Bulletin, October 1, 1944, p. 338. Documentation regarding these conversations following the Second Quebec Conference, is scheduled for publication in a subsequent volume of Foreign Relations.
  2. For Secretary Hull’s letter to the Secretary of War, Henry L. Stimson, see Foreign Relations, 1944, vol. ii, p. 304.
  3. Combined Civil Affairs Committee.