Foreign Relations of the United States, 1955–1957, American Republics: Multilateral; Mexico; Caribbean, Volume VI

137. Memorandum of a Conversation, Department of the Treasury, Washington, May 23, 1957¹

Washington, May 23, 1957

SUBJECT

• Buenos Aires Economic Conference

PARTICIPANTS

• Under Secretary Randolph Burgess, Department of Treasury
• W—Deputy Under Secretary Dillon
• ARA—Mr. Rubottom
• Assistant Secretary McClellan, Department of Commerce
• Mr. Poirier, Department of Commerce
• Mr. George Willis, Department of Treasury
• Mr. Elting Arnold, Department of Treasury

On the initiative of the Treasury Department, Deputy Under Secretary Dillon and I attended this meeting in Under Secretary of Treasury Burgess’ office for the purpose of orienting U.S. thinking in respect to the upcoming Buenos Aires economic conference and especially the first item on the agenda which has already been approved, viz., Inter-American Economic Agreement.² Mr. Willis, in telephone conversations with me, had made it clear that Mr. Burgess was somewhat reluctant to have the representatives of the Treasury Department enter into detailed discussions of the text of the agreement until such time as this meeting had taken place.

At Mr. Burgess’ request, I briefly outlined the positions taken by the United States at international conferences over the past few years, especially the one at Caracas in March 1954, followed by the Rio Economic Conference in November of that year, in which we had, along with the Latin American governments, agreed to have prepared a systematized compilation of various economic declarations, resolutions and recommendations approved by the Inter-American Conferences with the understanding that this compilation should be used as the basis for the draft text of a general economic agreement. I also read specifically from the text of the resolution³ adopted with our approval at the Rio Conference placing responsibility on the Inter-American Economic and Social Council to make this draft text with the understanding that it would be considered at a meeting of plenipotentiaries such as the one coming up in Buenos Aires in August of this year.

Mr. Burgess expressed his understanding of the background which had led up to our present situation and recalled the discussions as well as the ultimate resolution approved at the Rio Conference. However, it was evident from the statements made by Under Secretary Burgess and Messrs. Willis and Arnold, that the Treasury Department still has very serious doubts as to whether we should undertake to negotiate with the Latin American governments on a text of the kind drafted by the Secretariat of the Pan American Union at the request of the Inter-American Economic and Social Council. I made clear repeatedly that we recognized that the draft text included language which goes far beyond that which the United States has ever agreed to in the past or conceivably could agree to in the next meeting, but that this was generally the case and that we should not hesitate to decide our position and then negotiate it as strongly and as effectively as possible. We should, of course, always bear in mind the possibility that we would have to take a stand which might be considerable at variance with our Latin American friends.

The Treasury representatives were very much concerned over the possibility of having to submit such an agreement, assuming that we are successful in negotiating one, to the Congress. They feel that the present mood of Congress is such that there is very little chance of success in getting any type of agreement ratified. The Commerce Department representatives echoed this sentiment on the basis of their recent experience in support of OTC.

It was agreed by all that it would be far easier from the U.S. point of view if any agreement could take the form of a Declaration rather than a treaty or executive agreement. However, I pointed out the real doubt that the Latin American countries would be satisfied with another Declaration or that it would fulfill our commitment to negotiate for an agreement. I agreed to consult within the Department to determine our preference as between an executive agreement and a treaty.

It was also agreed by all present that I should immediately discuss this subject with the President’s Counsel, Mr. Gerald Morgan, and possibly have preliminary talks with the staff, at least, of the Senate Foreign Relations Committee in order to apprize them of the present U.S. posture on this subject. I said that I would undertake to do this as quickly as possible.

Mr. Willis inquired about the procedures to be followed in submitting the text of such an agreement to the Senate for ratification. I said that this was a routine matter which probably would involve obtaining the comments of the various interested government agencies and that the State Department presumably would take the initiative in sending it over to the Foreign Relations Committee. This seemed to satisfy the Treasury representatives who, I gathered, had no particular interest in handling the agreement in the event it emerged from the BA Conference.

The Treasury representatives voiced their already known doubts about the order of the Agenda, stating that the agreement should really be the last item rather than the first item on the Agenda since the subsequent items were all included in the agreement text as chapters or subordinate headings. On the other hand, they as well as the others present recognized that the various Agenda items would be assigned to working committees at the Conference and the net effect would be to have all of the subjects discussed simultaneously.

All of those present are aware of the need for giving this matter urgent consideration and I said that I would call a meeting of the CFEP Sub-Committee for sometime next week.

I made it clear that the United States had already committed itself to take part in negotiations looking toward an agreement in some form and that we intended to approach the upcoming BA Conference with the most positive frame of mind and most constructive program possible, otherwise there was no point in attending the Conference. I also indicated awareness of strong resistance in some branches of the Executive to this, or any other type of agreement with the/Latin American governments while, at the same time, we were not objecting to the European common market and other regional approaches to problems which were just as severe for Latin America as they were for any other area of the world. Therefore, the United States could not adopt a completely negative attitude with respect to discussing, at least, the subject matter included in this draft agreement. Mr. Dillon expressed his agreement with this line, as did Under Secretary Burgess and Assistant Secretary McClellan.

1. Source: Department of State, Central Files, 365/5–2357. Official Use Only. Drafted by Rubottom.
2. The IA–ECOSOC approved the final version of the agenda for the Buenos Aires Conference on February 14. It consisted of five main parts: I. General Economic Agreement, II. Economic Development, III. Foreign Trade, IV. Technical Cooperation, and V. Transportation. For text, see Economic Conference: USDel Report, p. 19.
3. Reference is to Resolution 39/54, which instructed the IA–ECOSOC to prepare a draft of a General Economic Agreement, on the basis of the compilation contained in document ESSE–10/54, the recommendations, declarations, and resolutions adopted at the Rio Economic Conference, and all decisions of an economic nature adopted up to the time when the draft text would be presented to the Buenos Aires Economic Conference. Document ESSE–10/54 was revised and updated by the Secretariat of the OAS and presented to the Buenos Aires Economic Conference as document 13/57, entitled “Compilation of Treaties, Conventions, Resolutions and Recommendations on Economic Topics Adopted by the American Republics since 1889”, which was current to June 1957.