S/S–NSC Files, Lot 63 D 351, NSC 104–Memoranda
Memorandum by the Deputy Assistant Secretary of State for Economic Affairs (Linder) to the Secretary of State 1
Subject: National Security Council Agenda for June 13
Item 2—“NSC Determinations under Section 1302, 3rd Supplemental Appropriations Act of 1951”
The National Security Council agenda for June 13 includes the following items on which comments are provided below:
1. NSC 1112—NSC Determinations Under Section 1302, Third Supplemental Appropriation Act, 1951 (The Kem Amendment)
This document is a proposed Interim General Exception under the Kem Amendment. In view of the impossible time schedule for certification provided in the Kem Amendment, it is necessary for the National Security Council to establish a general exception for all countries receiving United States economic and financial assistance within fifteen days of the enactment of Section 1302. If such a general exception is not made, it will be necessary under the terms of the Kem Amendment to terminate assistance in the absence of certification by each country receiving such assistance that it has not exported or knowingly permitted the exportation to the Soviet Bloc of items appearing on the list of arms and other articles or commodities which may be used in the manufacture of arms, certified by the Secretary of Defense on June 5, 1951. NSC 111 concludes that the National Security Council should determine that it would be to the security interest of the United States to make a general interim exception from the provision of Section 1302 for all countries now receiving economic and financial assistance from the United States. It is provided that this interim exception will be superseded as rapidly as possible by determinations under Section 1302 with respect to specific countries or areas. It is also provided that NSC 111 should be declassified and transmitted to the committees of Congress.
Recommendation:
It is recommended that NSC 111 be approved in its present form and transmitted to the necessary committees of Congress.
2. Annex No. 1 to NSC 1113—Trade Between Austria and the Soviet Bloc; Annex No. 2 to NSC 1114—Trade Between Norway and the Soviet Bloc
These are the first two country evaluations completed in accordance with Section 1302. Similar country evaluations will be prepared for [Page 1108] each of the other sixty-odd countries receiving assistance. These two studies on Austria and Norway conclude that it would be to the security interest of the United States to make an exception from the provision of Section 1302 in the light of the reasons included in the “discussion section” of the document. As is the case with the general exception, it is also intended that these documents should be declassified and submitted to the necessary committees in Congress. It is believed that these two country studies will be illustrative of the varied types of situation covered by the Kem Amendment and will be indicative of the type of problem proposed by most countries receiving United States assistance. This problem is posed by the fact that most countries receiving United States assistance do export to the Soviet Bloc some of the items appearing on the Defense Department list, although the termination of assistance for this reason alone would be contrary to our national interest. The formula followed in these two country studies is to continue the examination of their trade with the Soviet Bloc and to seek measures for diminishing the flow of strategic commodities to the Soviet Bloc, through negotiation or other appropriate measures.
Recommendation:
It is recommended that the country studies be approved as they are contained in the Annexes 1 and 2 to NSC 111, and be transmitted to the necessary committees of Congress.