Office of the Historian

288. Memorandum From the Under Secretary of State for Economic Affairs (Dillon) to Secretary of State Dulles0

December 12, 1958.

SUBJECT

  • Oil Imports

Mr. Mann had a relatively successful talk with the Venezuelan and Canadian representatives here in Washington regarding the imposition of mandatory country import quotas. Both the Venezuelan and Canadian representatives said they would recommend our proposal to their governments, but both of them said no final decision could be had for internal political reasons until some time in the New Year. Therefore, it was decided to go ahead and make a modified version of [Page 580] the present system mandatory on a temporary basis as of the first of the year, and allow State a reasonable period of time to reach agreement with the Canadian and Venezuelan governments on the permanent solution involving country import quotas.

Late yesterday Secretary Strauss informed Governor Herter that he had had second thoughts about this and felt that there should be no more conversations with Venezuela and Canada, and that after issuing a temporary mandatory order as of the first of January the whole matter should be thrown into the laps of the Congress for their decision. Secretary Strauss indicated he still favored the solution of a cost compensating import excise tax which would equalize the cost of foreign oil at American ports with a heavier tax on the cheaper oils from the Middle East. If he has not already done so I assume that he will be talking to the President along these lines some time in the near future.

It would be most helpful if you could say a word to the President about the extreme difficulties which would be posed by the adoption of this principle, i.e., the drive to extend the same principle to Japanese imports.1

  1. Source: Eisenhower Library, Dulles Papers, Memoranda with the President. Confidential; Personal and Private.↩

  2. According to a memorandum from Dillon to Mann, also December 12, Dulles and Dillon spoke to the President about the oil import problem as follows:

    “The President indicated that while taking no decision at this time, he was in full accord with the Secretary’s thinking about the inadvisability of turning this subject over to the Congress for decision.” (Department of State, Central Files, 811.2553/12–1258)

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