Foreign Relations of the United States, 1952–1954, General: Economic and Political Matters, Volume I, Part 1

Eisenhower Library, Eisenhower papers, Whitman file

Minutes of a Cabinet Meeting, Held at the White House, 9:05 a.m., December 10, 1954¹

confidential

White House, 9:05 a.m., December 10, 1954

• The following were present:
• The President
• Vice President Nixon
• Sec. Dulles
• Sec. Humphrey
• Deputy Sec. Robert Anderson (for Sec. Wilson)
• Asst. Attorney General J. Lee Rankin (for Mr. Brownell)
• Mr. Summerfield
• Sec. McKay
• Under Sec. True D. Morse (for Sec. Benson)
• Under Sec. Robert Murray (for Sec. Weeks)
• Sec. Mitchell
• Sec. Hobby, and Under Sec. Nelson Rockefeller
• Director Hughes
• Gov. Stassen
• Dr. Flemming
• Chairman Young
• Dr. Burns
• Mr. Clarence Randall, in part
• Hon. Albert M. Cole, HHFA, and two assistants, in part
• Hon. Roswell Perkins, HEW, and assistants, in part
• Hon. Allen Dulles, CIA, in part
• Adm. Strauss, AEC, in part
• Dr. Scoville, in part
• Gov. Adams
• Mr. Shanley
• Gen. Cutler
• Dr. Hauge
• Mr. Harlow
• Mr. Morgan
• Mr. Martin
• Mr. Rabb
• Mr. Minnich

Secretary Humphrey presented to the President the traditional “Presidential Medal” made by the Treasury Department for each President. He promised that the Treasury would provide each Cabinet member with a replica.

Foreign Economic Policy (CP–4² and CP–5³)—Dr. Randall presented the proposed Executive Order regarding the Buy American Act with a statement that the formula developed at Cabinet last July had been cleared at staff level in the departments and agencies. He stressed the psychological need for adopting it in the very near future. The Director of the Budget called attention to Section 3 (a) which had been inserted for legal reasons by the Attorney General as an “escape clause”. He hoped it would be understood that Cabinet members would not ride off on separate tangents under the authority of this clause, but would instead discuss thoroughly with other interested officials any major exceptions to policy which they proposed to make under it. When asked by the President if the clause would vitiate the effect of the Order, Mr. Randall replied in the negative. Mr. Rankin explained that the clause was deemed necessary because of the existence of the basic Buy American Act and the constitutional delegation to Congress of control over foreign commerce. Sec. Dulles cited the opposite delegation of authority to the President over his Cabinet. Mr. Randall believed the draft effected a good balance between these delegations of authority.

The President suggested inserting the words “of urgent national interest” after “reasons” in the escape clause. Mr. Randall and Mr. Rankin agreed that such would be possible, although Mr. Randall expressed a doubt that it might limit the freedom of department heads to reject a bid because of other reasons such as the irresponsibility of the bidder. Mr. Rankin saw no danger in this because such cases were covered elsewhere in the Order.

Mr. Hughes reiterated the need for understanding that thorough discussion would be arranged for any major exception proposed under Section 3 (a), a matter which should appear in the Record of Action. The President stated his complete agreement.

Mr. Randall briefed his paper on the legislative program concerning foreign economic policy as constituting those parts of the program recommended to Congress last March but not yet achieved. He added his hope that emphasis would be placed on this program in the State of the Union Message⁴ and the special message⁵ to follow, and that it would be given top priority on the Congressional agenda subject only to priority for Treasury needs in regard to excise matters. He indicated that Committee hearings would be top level in quality and he pointed to the extensive growth in sentiment during the past year in favor of these proposals. In running over allied items, he stressed the program for incentives for the flow of investment in foreign lands, the reciprocal 5-year exemption proposal, the International Finance Corporation proposal, continued technical assistance both direct and through the United Nations, the implementation of the Geneva GATT Conference, revision of customs procedures, and finally the Japanese economic program.

The President asked as to the desirability of attempting in the State of the Union Message to paint a picture of the wonderful world which could be had by a free flow of capital. Mr. Randall and Sec. Dulles agreed that it would be desirable.

The Vice President questioned and was reassured that this program would be on the agenda of both legislative meetings next Monday and Tuesday.⁶ Mr. Stassen added a comment on the unrecognized strength of public opinion in favor of this program, and Mr. Dulles commented on the lack of organization among exporters who stood to benefit considerably from this program.

[Here follows discussion of other legislative programs and the defense mobilization question.]

1. Prepared by Minnich.
2. Supra.
3. The reference Cabinet Paper, designated CP–5, containing a draft of Executive Order 10852, is not printed.
4. Reference is to the President’s Annual Message to the Congress on the State of the Union, delivered before a joint session on Jan. 6, 1955; for text, see Public Papers of the Presidents of the United States: Dwight D. Eisenhower, 1955, pp. 7–29.
5. Reference is to the President’s Special Message to the Congress on the Foreign Economic Policy of the United States, delivered on Jan. 10, 1955; for text, see ibid., pp. 32–40.
6. The reference bipartisan legislative leadership meetings took place on Dec. 13 and 14, 1954. For extracts of the notes of the Dec. 13 meeting, see pp. 217 and 809; extracts of the notes of the Dec. 14 meeting are printed infra and p. 811.