5. Memorandum of Conversation Between Secretary of State Dulles and Vice President Nixon0
[Here follows discussion of possible foreign trips by the Vice President.]
(2) We discussed at some length the project for a study of economic warfare. We agreed that there were two aspects; one, the possibility that within the next two to five years the Soviet Union might develop a capability and purpose to wage economic warfare against our free enterprise system by getting control of raw materials and by disrupting free world markets through dumping of raw materials and/or manufactured goods. There might be a real question as to whether our classical free trade methods based upon profits by private enterprise could survive that kind of a struggle.
Then there was the second phase already with us of handling effectively our own economic aid programs and meeting Soviet bloc competition in the less developed countries.
With respect to the first matter, I suggested that an unpublicized study by some experienced person such as Sydney Weinberg,2 drawing upon government and private persons for advice, would be the best way to handle this matter. The Vice President said he was inclined to agree to this approach.
With respect to the more efficient handling of our own foreign aid, including the Export-Import Bank and the new Development Loan Fund, the Vice President felt the strong need of a more authoritative and unified direction. He wondered whether the status of Dillon might be increased by making him an Under Secretary of State rather than [Page 9] Deputy Under Secretary and then giving him a certain directive authority covering the entire field.3
I said I doubted that a mere change in title would accomplish the result. He could be given added authority by the President and myself, but the problem would be how, for example, to bring the Exim Bank and Development Loan Fund into a single, cohesive, policy performing agency, since there were built-in statutory provisions and Congressional backing of different kinds. It would, I thought, be necessary to have some clear understanding with the manager and directors of the Exim Bank. I did not think that this could be achieved merely by a slight change in Dillon’s title. The problem was much more fundamental than that. The Vice President indicated that he was disposed to agree and that the problem of how to proceed required perhaps some further thought. He felt, however, very strongly, as did I, that greater unity and efficiency were required in this field of foreign aid, particularly to less developed countries.