Foreign Relations of the United States, 1952–1954, General: Economic and Political Matters, Volume I, Part 2

Eisenhower Library, Eisenhower papers, Whitman file

Memorandum of Discussion at the 210th Meeting of the National Security Council on Thursday, August 12, 1954¹

top secret
eyes only

August 12, 1954

Present at this meeting were The President of the United States, presiding; the Vice President of the United States; the Secretary of State; the Secretary of Defense; the Director, Foreign Operations Administration; and the Director, Office of Defense Mobilization. Also present were the Acting Secretary of the Treasury; the Secretary of Commerce (for Item 1); the Director, Bureau of the Budget; the Chairman, Atomic Energy Commission (for Item 4); the Secretary of the Army, the Secretary of the Navy, and the Secretary of the Air Force (for Items 5 and 6); General Twining for the Chairman, Joint Chiefs of Staff, the Chief of Staff, U.S. Army, Vice Admiral Gardner for the Chief of Naval Operations, and General Pate for the Commandant, U.S. Marine Corps (for Items 5 and 6); Robert R. Bowie, Department of State (for Items 1, 2 and 3); Marshall Smith, Department of Commerce (for Item 1); Walter S. Delany, Foreign Operations Administration (for Item 1); the Director of Cental Intelligence; the Assistant to the President; Robert Culter, Special Assistant to the President; the Executive Secretary, NSC; and the Coordinator, NSC Planning Board Assistants.

There follows a summary of the discussion at the meeting and the main points taken.

1. Economic Defense Policy: U.S. Export Controls (Progress Report, dated August 2, 1954, by the Secretary of Commerce on NSC 152/3,² pars. 21 and 23)

Mr. Cutler recalled that the Council, on June 17, had amended NSC 152/3 by adopting new paragraphs 21 and 23 (NSC Action No. 1158³). He read new paragraph 21 and summarized paragraph 23. He also recalled that Governor Stassen had orally reported to the Council, on July 22, on the final results of the reexamination of the International Lists (NSC Action No. 1181).⁴ Governor Stassen’s report had indicated that (1) all items considered by the U.S. to be in the highest priority were retained on the Lists; (2) transshipment and transaction controls were agreed; (3) the new Lists would go into effect on August 16; (4) removal from the Lists of certain items such as ball bearings was deferred until December 1954; and (5) the U.S. had yielded to a small extent on tonnage and speed limitations under shipping controls.

Mr. Cutler indicated that since the date of Governor Stassen’s report there had been some slight changes in the number of items on the various lists. The 176 items on the embargo list, as reported by Governor Stassen, had now become 167; the 24 items on the quantitative list had now become 23; and the 55 items on the watch list had become 62.

Mr. Cutler said that the purpose of the Progress Report now before the Council was threefold: First, to indicate the magnitude of the problem; second, to give the Council an opportunity to examine the actions proposed by Commerce in putting the new lists into effect; and third, to determine the nature of a public announcement on the subject.

Revised Attachments 5, 6 and 8 of the reference Progress Report by the Secretary of Commerce were then distributed (copies filed in the minutes of the meeting). Secretary Weeks said that he had presented this Progress Report because he thought the Council would want up-to-date information on the subject. Commerce was now prepared to deny or limit to the Soviet bloc commodities which COCOM agreed should be embargoed, the additional commodities for which U.S. unilateral control would be effective, and other commodities of special political significance in the U.S. Short-supply items or the export of technical data were not covered by the new lists.

Secretary Weeks said the Council might discuss the timing of the public announcement on this subject. Normally this announcement would be issued on August 16, but the Secretary understood that Governor Stassen had some qualms about this date. Governor Stassen said that if FOA appropriations were being debated in Congress on August 16, he would prefer to delay the public announcement on export controls until this debate was over. He feared that the new export control policy might be made the subject of demagogic speeches. Secretary Weeks agreed that the subject was one which easily lent itself to demagogic speeches.

The President agreed that issuance of a public announcement should be timed in the light of Congressional action on the mutual security bill. Referring to the proposed press release by Commerce (revised Attachment 8), the President noted that an important quotation by the Secretary of Commerce, to the effect that the new export control policy would benefit both U.S. business and friendly countries, was buried at the bottom of page 2. The President felt that a succinct but emphatic statement along these lines might become paragraph 1 of the press release. We should say that we have reviewed the International Lists to make certain we are not aiding the Soviet war-making ability and to be sure that we are increasing trade to benefit ourselves and the world. We might also say that stricter enforcement would be possible on the basis of a list of manageable length.

Secretary Dulles noted that the press release on page 2 referred to improving “even further the efficient system of enforcement”. It was a question in his mind whether international enforcement had been effective in the past; therefore, he felt that it would be better to omit any mention of how efficient enforcement might have been.⁵

Secretary Wilson said that the new lists represented a great liberalization of our policy. He noted, however, that we still did not permit the Russians to purchase sabers from us. The President said he would be willing to give them sabers.

The President then remarked that he had never heard the pros and cons of export control policy exhaustively presented on a philosophical basis. He noted that the Russians were always trying to promote more trade.

Secretary Weeks said the Administration had scored a success in obtaining Trade Fair appropriations. The President said he hoped the exhibits for this Fair could be prepared without delay.

Governor Stassen said that he would issue a press release on changes in the Battle Act, and that he would coordinate his press release with the Commerce announcement.⁶

The National Security Council:

a. Noted the reference Progress Report on the subject by the Secretary of Commerce, including revisions of Attachments 5, 6 and 8 distributed at the meeting.

b. Discussed the proposed press release by the Secretary of Commerce in the revised Attachment 8, and agreed that:

(1) It should be revised by the Secretary of Commerce in the light of the discussion at the meeting.

(2) The date of its issuance should be coordinated by the Secretary of Commerce with the Director, Foreign Operations Administration, in relation to Congressional debate on the mutual security bill.

c. Noted that the Director, Foreign Operations Administration, would issue a coordinated press release on the changes in the Battle Act.

Note: The action in b above subsequently transmitted to the Secretary of Commerce, and the actions in b and c above transmitted to the Director, Foreign Operations Administration.

[Here follows discussion concerning a study of the anti-trust laws, significant world developments affecting United States security, cooperation with other nations in the peaceful uses of atomic energy, the redeployment of United States forces in Trieste, a review of United States policy in the Far East, and the National Security Council status of projects.]

1. This memorandum of discussion was prepared on Aug. 13 by Deputy Executive Secretary of the National Security Council Gleason.
2. Not printed; 83 pages in length, it consists of a cover sheet, a letter by Secretary of Commerce Weeks to Cutler recommending that the NSC undertake a review of the implementation by the Department of Commerce of the directives issued in paragraphs 21 and 23 of NSC 152/3, a summary memorandum by Secretary Weeks describing the contents of the attachments, and 8 attachments as follows: (1) the texts of paragraphs 21 and 23 of NSC 152/3; (2) an extract of criteria governing the inclusion of items on the U.S. master export security list; (3) a list of items to be embargoed by the United States by virtue of their inclusion on the International Lists; (4) a list of items to be quantitatively controlled by the United States by virtue of their inclusion on the International Lists; (5) a list of items to be unilaterally embargoed or controlled by the United States on the grounds that the United States was the only producer of them; (6) a list of items to be unilaterally embargoed or controlled by the United States because of special political considerations; (7) a list of deletions from the former U.S. master export security lists; and (8) a draft proposed press release on the new export control program. (S/S–NSC files, lot 63 D 351, NSC 152 Series) For text of NSC 152/3, see p. 1207.
3. NSC Action No. 1158 is the directive issued pursuant to agenda item 2 by the NSC at its meeting of June 17; see the memorandum of discussion, p. 1197.
4. The reference here is to the summary which appears at the end of agenda item 4 of the NSC memorandum of discussion of July 22, supra.
5. For the text of Secretary Weeks’ press release, dated Aug. 26, see the Department of State Bulletin, Sept. 13, 1954, p. 373.
6. For the text of Governor Stassen’s press release, dated Aug. 25, see ibid., pp. 372–377.