560.AL/5–446
Memorandum by the Department of State to President Truman
Last December the United States invited fifteen countries to negotiate reciprocal reductions of tariffs and other trade barriers under the Trade Agreements Act.
This invitation was an essential part of the broad trade arrangements in our Proposals for Expansion of World Trade and Employment, for which we obtained British support during the negotiation of the Financial Agreement.
We have now reached the point in our discussions and preparations where a definite date must be set for the opening of the international meeting at which trade-agreement negotiations will be conducted.
It is proposed that this meeting be held at London and that it begin on September 15. This date would be subject to change only if Congress fails to approve the Financial Agreement or unduly delays action on the agreement.
When Congress has approved the Financial Agreement, we would issue formal public notice of intention to conduct trade-agreement negotiations with the countries concerned. This notice, which is required under the Trade Agreements Act, should be issued not later than June 15 in order that there will be ample time to complete our preparations for the September meeting.
The notice would be accompanied by a list of products on which tariff concessions would be considered and the usual public hearings held. This list will be submitted to you for consideration before publication.
Experience has shown that once this list is published, minority interests will put strong pressure on the Administration for commitments that particular tariff rates will not be cut.
The dangers in this situation are very real. Commitments not to reduce the tariff on particular items, on which concessions are considered essential by the other countries concerned, might easily defeat the objectives of the Trade Agreements Act, wreck the pending negotiations, and bring to nothing our Proposals for Expansion of World Trade and Employment.
These dangers can be guarded against if all those concerned are prepared to meet them. It is suggested, therefore, that you may wish to warn all interested members of the Cabinet and to indicate to them the only safe procedure to be followed in dealing with representations of the kind described. The main points are as follows:
- 1.
- Because of the number of countries involved, the list of products will necessarily be long and will include many items likely to arouse vigorous opposition by special interests. Cabinet members are therefore [Page 1308] likely to be approached by persons seeking commitments against action on particular rates of duty. It is of vital importance that no such commitments be given.
- 2.
- Under trade-agreements procedures, no decisions can be made until after all interested parties have had an opportunity to present views at the public hearings and until the interested agencies of the Government have been fully consulted as provided by law. The mechanism for this consultation is the Interdepartmental Trade Agreements Committee.
- 3.
- It should be explained to persons protesting possible tariff cuts that the Administration must consider all United States interests before reaching a decision on a particular rate of duty, and must so weigh the various interests as to serve the national interest as a whole. Such persons can be assured that their interests will be given the most careful consideration.
- 4.
- Whatever the concessions eventually made, the United States will insist upon including in the prospective trade arrangements an adequate “escape clause” which will permit this country to take prompt and effective action in any emergency. This should go far to allay reasonable fears of injury to established industries.
- In this connection it may be useful to refer to your letter of May 25, 1945 to Speaker Rayburn, in which you said “I have had drawn to my attention statements to the effect that this increased authority [under the Trade Agreements Act] might be used in such a way as to endanger or ‘trade out’ segments of American industry, American agriculture, or American labor. No such action was taken under President Roosevelt and Cordell Hull, and no such action will take place under my presidency.”
- 5.
- The actual concessions to be granted and received will not become known until the negotiations are completed and the resulting agreement published. This will probably not be until the end of this year and possibly not until early next year.
If you approve, it is proposed to inform the other interested governments that September 15 is a satisfactory date for the opening of the trade meeting, it being understood that our formal public notice and accompanying list of products will be issued not later than June 15, barring unforeseen developments in connection with the Financial Agreement.56
- It cannot be determined precisely when this memorandum was sent to President Truman; it occurred in the week between April 5 and April 12.↩