493.119/11–2950
Memorandum by Mr. Max W. Bishop to the Ambassador at Large (Jessup)1
Subject: Trade Embargo on China
Bill Martin of Treasury2 has just telephoned and asked me to pass on this message to you:
The Treasury feels that if we were to place a trade embargo on China that they would want to act simultaneously in the financial field and to block accounts, financial transactions, etc. He said that it would place us in a unfavorable light, if we were to put on a trade embargo and follow it in a few days with a “financial blocking”. I asked whether the President had all the authority that we need for financial blocking. He replied that all legislative authority was in being and that actually Treasury had orders and all the necessary papers drafted and ready to go; but that they, of course, did not want to act without clearing it with the President or with the National Security Council; and certainly would want to act in coordination with any trade embargo or similar economic measure.
Bill Martin said that he thought that you would want to know about Treasury’s attitude in considering the question of trade embargo. I agreed heartily with him that it would affect consideration of a trade embargo.
I shall inform Livy Merchant of this conversation as soon as I can get through to him.