Office of the Historian

184. Memorandum From the Chairman of the Council on Foreign Economic Policy (Randall) to the Council1

CFEP 539/1
Washington, August 9, 1956.

SUBJECT

  • CFEP 539—Effect of Regional Economic Integration on U.S. Trade and Other Economic Interests
1.
It has been suggested to the Council that the effect of economic integration of Western Europe and other regions on U.S. trade and other domestic economic and foreign policy interests be reviewed.
2.
It is the policy of the United States to support the economic integration of Western Europe. A number of international organizations have been established to facilitate achievement of this objective and proposals for a further reduction of trade barriers and the establishment of a common market are receiving serious attention. Such activities may have far-reaching implications for the U.S. economy and for the trade and other economic interests of the rest of the world.
3.

A review of the effects of the activities and accomplishments of these organizations on U.S. trade and other domestic economic and foreign policy interests, together with a study of the possible impact of the development of a common market in Western Europe, [Page 461] will provide a basis for charting future U.S. policy more intelligently.2

4.
It is recommended that the Council undertake this review and that a Council subcommittee, chaired by a member of the Council of Economic Advisers and including high level representatives of the Departments of State, Commerce, Treasury, and Agriculture and the International Cooperation Administration, be appointed to prepare a report and recommendations on the subject for consideration by the Council.
5.
The Subcommittee should submit to the Chairman, CFEP by August 31 an outline of the study it contemplates. The final report and recommendations should be submitted to the CFEP by December 1, 1956 and the Subcommittee should submit biweekly progress reports to the Chairman, CFEP.3
Clarence B. Randall
  1. Source: Department of State, E–CFEP Files: Lot 61 D 282A, CFEP 539. For Official Use Only.↩

  2. In a memorandum of February 9 to Joseph Dodge, Gabriel Hauge recommended this idea. “I wonder” his memorandum noted, “if we ought not to set up a CFEP agenda item that would seek to explore the implications for the U.S. of genuine progress toward economic integration in Europe. I have a feeling that a lot of people in government plug this line actively without having thought through very much what it means in terms of discrimination against our trade, etc.” (Eisenhower Library, CFEP Records)

    In a memorandum of May 1 to Dodge, Paul Cullen noted Hauge’s suggestion and recommended that an agenda item be established on this subject for the CFEP. (Ibid.)

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  3. At the 46th meeting of the CFEP on August 14, the Council made the following decision on this matter:

    “The Council approved the recommendation of the Chairman (CFEP 539/1) that a CFEP Subcommittee be established to review the effect of regional economic integration on U.S. trade and other economic interests as proposed in CFEP 539/1 dated August 9, 1956. The Council agreed this Subcommittee would be chaired by a member of the Council of Economic Advisers and include high-level representatives of the Departments of State, Commerce, Treasury, and Agriculture, and the International Cooperation Administration. The Council requested the Subcommittee to submit its final report and recommendations to the Council by December 1, 1956, and to submit to the Chairman, CFEP, an outline of its study by August 31 and bi-weekly progress reports thereafter.” (Ibid.)

    In a memorandum to the CFEP dated September 5, Cullen noted that the membership of the CFEP Subcommittee on Regional Economic Integration was as follows: Joseph S. Davis of the Council of Economic Advisers (Chairman); Thorsten Kalijarvi; Marshall M. Smith, Deputy Assistant Secretary of Commerce; George H. Willis, Director of the Office of International Finance, Department of the Treasury; Earl L. Butz, Assistant Secretary of Agriculture; and Stuart H. van Dyke, Regional Director of the Office of European Operations, ICA. (Department of State, E–CFEP Files: Lot 61 D 282A, CFEP 539) All of the progress reports of the Subcommittee are in both Eisenhower Library, CFEP Records; and Department of State, E–CFEP Files: Lot 61 D 282A, CFEP 539.

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