460.509/3–2954: Telegram

The Ambassador in the United Kingdom (Aldrich) to the Department of State

top secret
priority

4201. Eyes only Dulles and President. From Aldrich and Stassen.1 Thorough and fruitful after dinner conversation tonight East-West trade issues at Chequers with Churchill, Thorneycroft, Reading, Cherwell. Churchill developed his theme (his letter2 to President) that expanded trade directed toward consumer interests of Soviet area peoples should be contemplated specifically indicating that he considered and rejected “stringent economic discontent approach” and favored affirmative “better life if you accept it” approach. Also indicated he realized trade and contact with German people under Hitler had not prevented World War II but stated he believed Russian people were different because of their long grim experience. He inquired as to US strategic appraisal. Stassen responded [Page 1135] with analysis of high significance of inability today of Soviet to deliver massive comprehensive air and missile attacks, inability to prevent our massive retaliation, and significance of retarding entire field of Soviet mass air and missile capability and electronic and telecommunication field offensively and defensively. Stassen also stressed basic importance of UK and US standing together and taking time necessary to resolve narrowed issues at high level if necessary. Further commented on undesirable aspects of permitting divergencies of UK–US position to be voted on by other nations in COCOM. Churchill expressed general agreement with Stassen’s analysis and asked that issues be narrowed by discussions next two days and indicated remaining differences if any might be referred to him and President rather than to vote of Western European nations, concurring in this respect with Stassen comment. He did press for decontrol copper and stated he would trade nickel on list for copper off list. Stassen indicated both should continue under control.

Churchill further emphasized that his one hand approach of a better life for Soviet people not meant to decrease other hand policy of powerful relative military strength. Churchill agreed that credit should not be extended to Soviet and that total volume trade would not be large without credit. He did comment however that Butler would continue to be glad to get gold as their reserves were better but not adequate.

Churchill volunteered that he was being pressed to ask US to call off further hydrogen bomb tests and that he would firmly refuse anticipated questions Commons Tuesday making such request.

All British present indicated appreciation Eisenhower administration policies which had helped strengthen sterling position and minimized effect of economic adjustment in US. Aldrich described US economic position and policies.

Believe excellent basis laid for resolving portion of issues in talks Monday and reserving any remainder issues for further high level review without public split. Also fair prospect of tightened transaction controls by UK on a shorter list of strategic trade.

It will be necessary to indicate yielding on tractors, rubber, and a few other lower priority items.

UK bilateral set Monday morning, French trilateral Monday afternoon.

Aldrich
  1. In response to Prime Minister Churchill’s invitation for a team to visit the United Kingdom to discuss the East-West trade issue, a group headed by Governor Stassen had arrived in London on the afternoon of Mar. 27.
  2. Transmitted in telegram 5011, supra .