Memorandum by the Assistant Secretary of State for Economic Affairs (Thorp) to the Secretary of State


Subject: Need to Persuade France to Support our Proposed Waiver of GATT Obligations to Czechoslovakia

Recently we sent you a paper regarding the need to obtain French support at the forthcoming GATT session for our request for the dissolution of obligations between the United States and Czechoslovakia under the General Agreement.1 It is understood that you wished to be briefed further on the arguments you may have to meet.

The French have made a decision at a fairly high level that they will not support our request for the following principal reasons:

French interests in Czechoslovakia are likely to be jeopardized. Czechoslovakia owes France a large debt, French citizens have been jailed, rolling stock taken. They fear reprisals.
France questions the particular procedure we have chosen but has no alternative to suggest. France feels that decisions under the GATT, such as our proposal for a waiver, should be taken on the basis of whether a country has adhered to the GATT’s provisions, not on any collateral issue such as our political dispute.

In reply to these arguments and in support of our position you may wish to point out the following to Mr. Schuman:

The waiver we are seeking from the Contracting Parties would provide for a dissolution of obligations both for the United States and Czechoslovakia. It would be a reciprocal, not a one-sided, termination or suspension of commitments.
The proposed waiver has been drawn and will be presented in such a way as to avoid the necessity on the part of countries voting for it to rule on the merits of the issues as between Czechoslovakia and the United States. Voting for the proposed waiver would simply recognize that the state of relations between the two countries is such as to make impossible the continuance of the obligations between them.
As regards the second point of the French, we agree that decisions under the GATT should be taken on the basis of adherence to the provisions of the Agreement and not on the basis of collateral [Page 1406] political issues. The difficulty in this instance, however, is that the gravity of the political issues between the United States and Czechoslovakia is such as to make an economic agreement between them meaningless. In the circumstances the only sensible solution is to terminate or suspend the Agreement between ourselves and the Czechs.
It will be difficult for our people to understand why France cannot support a proposal which simply amounts to a dissolution of a contract between the United States and Czechoslovakia, particularly when France is not being asked to take a position on the merits of the dispute. American people and American interests have taken sufficient abuse from Czechoslovakia that they will consider themselves entitled to the support of other friendly nations in breaking off an economic contract.

While the British have given greater indications of support for our position, they have as yet not definitely committed themselves to vote in favor of the waiver. It would be helpful if you could express your satisfaction to Mr. Morrison for such favorable indications of support as have thus far been forthcoming from his government, emphasize that the support of his government is essential in obtaining a favorable decision from the Contracting Parties on the matter, and suggest that we would appreciate their active assistance in obtaining the earliest possible approval of the waiver from the Contracting Parties.

To: The Secretary
From: H. F. Linder2

Possibly the strangest [strongest?] argument in support of our position is that, irrespective of how the matter now comes out of GATT, we are under a legislative mandate to terminate our tariff concessions to the Czechs. Thus, if the GATT conference fails to approve bi-lateral termination, and we act, the Czechs will in all probability appeal to the GATT. In that event, our friends will be in the more embarrassing position of having to pass judgment on action which we shall have perforce taken unilaterally—with all the public relations implications.

  1. See footnote 2, supra.
  2. The Deputy Assistant Secretary of State for Economic Affairs.