Foreign Relations of the United States, 1951, National Security Affairs; Foreign Economic Policy, Volume I

800.00–TA/2–2751

Memorandum of Conversation, by the Under Secretary of State (Webb)

[Washington,] February 27, 1951.

Subject: Rockefeller Report¹

Participants:	Mr. Nelson Rockefeller
	Mr. Webb—Under Secretary

At lunch today Mr. Rockefeller and I had a long and friendly talk about his report. He explained to me that he was somewhat concerned at the reactions to the draft which had been sent out,² and that he and his Board were prepared to make substantial modifications in line with advice they had received from several quarters.

Essential points of the conversation were as follows:

(Made by Mr. Rockefeller)

1. That he doubts the long-range feasibility of the ECA program of large-scale grants for public works.

2. That he believes the institute or servicio type of operation is the only satisfactory one that can be maintained over a long period.

3. That he fears our technical assistance missions and experts will draw large-scale plans and elicit interest in foreign countries in them, which is apt to be disappointing by inability to execute the plans.

4. That he believes he can get substantial support from business, labor and other groups, and particularly support in Congress, for his idea of a World Development Corporation with the grants on a matching basis handled under somewhat the same kind of rules as foundations have operated in this country, and that the equity idea, although quite novel, seems to elicit wide interest from even such conservatives as Senator Byrd.

5. That Point IV has been badly understood and sold, and that he believes his Board can do much to help us clear up this situation, particularly if it is merged with the other programs mentioned.

6. That he had not fully understood the relationship between the Point IV program and our negotiation for Treaties of Friendship, Commerce and Navigation, which was thoroughly discussed today.

(Made by Mr. Webb)

1. That Mr. Acheson and I had decided to insist in every way we could on a proper position for the Ambassador in the capital of foreign countries, but were prepared to be more flexible with respect to Washington organizational arrangements, although in the latter we did expect to express our views strongly as the arrangements were discussed.

2. That our efforts to obtain an international legal framework for commerce and trade are intimately related to the handling of the technical assistance program and that I was not prepared to say at this time that this relationship should be broken. In fact, I indicated my belief that the relationship of the Point IV program to the negotiation of Treaties of Friendship, Commerce and Navigation was perhaps more important than its relationship to other technical assistance programs.

3. That the next year or so would provide a real testing period as to the future of ECA and that no one could say at this time what shape or form its organization would take. Therefore, I did not consider it wise to transfer the Point IV program into a receptacle of unknown characteristics, but felt it would be much wiser to keep the Point IV program in the State Department until the outline of the ECA operation of the future became much clearer. I pointed out that we had with great effort gotten the Point IV program going, that it was producing good results, and that it should not be thrown into another agency until the ECA organization itself had settled down into whatever long-range pattern the future held in store.

4. That the central problem to which his report did not address itself was the problem of how the activities of a large number of agencies of the Government were coordinated and brought into line with the generality of over-all foreign policy. I told him that I was perfectly prepared to see ECA operate as an independent agency provided means of coordinating its activities and keeping them in line with over-all foreign policy were worked out, but that I thought it highly dangerous to set up a lot of new agencies reporting directly to the President until this problem of coordination were worked out. I urged him to address his thought to this problem, indicating that we had to look at the over-all handling of foreign policy and could not confine our thoughts to one segment like economics, and that therefore we had to take a slightly different view than did he or others addressing themselves to some specific problem.

[5.] That a great effort had been made by Mr. Acheson and the staff of the State Department to provide in the Department a focal point efficiently organized for the coordination of foreign affairs activities throughout the Government. I pointed out that in two years we had made very great strides along this line, but of course recognized that much more had to be done. I pointed out that it would take about five years to perfect such an organization, but on the foundation of two years’ work the coming year, or third year, would produce very real accomplishments if the whole mechanism were not broken apart prematurely. I pointed out also that the problem of coordination would exist even if it were raised to the Presidential level by having a number of agencies in the foreign policy field reporting directly to the President.

[6.] That, in the main, what Mr. Acheson and I were concerned with was some means of getting it understood that agencies and people dealing with foreign policy should come to the Secretary of State or the Department first for guidance before taking off on one line or another which they might then expect to pressure the Secretary to adjust himself to.

1. Partners in Progress, Report of the International Development Advisory Board [The Rockefeller Report] (Washington, March 1951), prepared under the chairmanship of Nelson A. Rockefeller, former Assistant Secretary of State for American Republic Affairs (1944–1945).
2. The draft has not been identified.