Foreign Relations of the United States, 1958–1960, Western European Integration and Security, Canada, Volume VII, Part 1

70. Memorandum of Conversation⁰

September 29, 1959.

SUBJECT

• European Integration

PARTICIPANTS

• For the Netherlands
  • Dr. Joseph Luns, Foreign Minister¹
  • Dr. J.H. van Roijen, Ambassador
  • Dr. J.C. Kruisheer, Economic Minister
• For the United States
  • The Under Secretary
  • Ambassador Philip Young
  • Mr. Vass—TRC
  • Mr. Chadbourn—WE

The Netherlands Foreign Minister said he had expressed his concern to the Secretary that morning about certain recent developments in the European movement.² Mr. Luns then sought Mr. Dillon’s opinion on one of these developments, the Hallstein Report. Mr. Dillon replied that he had been somewhat surprised to hear from the Secretary at lunch that Mr. Luns was disturbed by this report. Only very recently Mr. Erhard had said that he thought the report would actually facilitate negotiations between the Six and the Seven. Mr. Luns replied emphatically that, quite to the contrary, Mr. Hallstein’s project if carried out, would close the door on negotiations with the Seven. He emphasized the point that the Six must not be permitted to shut themselves in, for this could only lead to the gradual division of Europe.

Mr. Luns then outlined his understanding of United States policy toward the European movement in general: While the United States supports the Common Market, the United States has reservations about a wider association which might have the effect of diluting the original concept of the Six and thereby put a halt to progress toward real European integration. The Dutch subscribe to these positions, he continued, in that they, too, do not want to see a dilution of the institutions of the Six. Nonetheless, the experience of the Benelux within the Six was proof that the institutions of a smaller group were not necessarily weakened when merged into a larger association. Original fears that Benelux institutions would suffer as a result of the absorption of the Benelux into the Six had proven groundless. On the contrary, Benelux was the hard core around which the Six had built their structure and the Benelux institutions would remain intact alongside those of the Six. Once the powers of the larger association were developed to a point where they duplicated those of the Benelux, consideration could be given to permitting the Benelux institutions to wither away. Mr. Luns thought the case would be similar for the Six within a larger association.

Mr. Luns then said that although the United Kingdom may have shown a certain lack of imagination a few years ago, it would now appear that the United Kingdom wants sincerely to come to an understanding with the Six. Nonetheless, if the Seven are able to come to an agreement among themselves this fall, and if no progress in establishing links between the Six and the Seven has been made by that time, both groups will tend to drift further apart. This will eventually result in the political division of Europe.

In Mr. Luns’ opinion, the Hallstein Report was linked to the recent proposal to organize political consultation within the Six in that both projects were aimed at inhibiting further efforts to expand the Six.³ The Netherlands strongly supports political consultation which logically grow out of gradual European integration. On the other hand, they were opposed to organized political consultation as now proposed by the French since it does not represent a genuine step towards real European integration. Mr. Luns also expressed his Government’s unalterable opposition to the idea of organizing a small secretariat in Paris.

Mr. Dillon replied that the various problems connected with the efforts to bridge the gap between the Six and the other countries of Europe were being examined carefully from the point of view of the United States’ interests. One of the United States’ principal concerns for some time has been whether and how a way could be found which, while avoiding the division of Europe, would not at the same time expose the United States, the Commonwealth and Latin American nations to trade discrimination. There were some aspects of the various plans to form a larger association which would not appear to conform to the GATT. The United States, of course, is in favor of a Free Trade Area, or any other such grouping aimed at similar goals, so long as it substantially conformed to GATT and would not lead to trade discrimination. Mr. Luns professed that there was no intention to discriminate against the United States.

Mr. Luns then reverted to the Hallstein Report and said that he had heard through his grapevine that the United States was supporting it. He expressed the hope that the United States would not reach any firm position until all other alternatives had been carefully examined. Mr. Dillon replied that although the United States has not taken a firm position on these proposals as yet, we did look with favor on certain aspects of the report, notably the extension of tariff reduction.

Mr. Dillon again emphasized that the question of potential trade discrimination is a matter of considerable concern to the United States.

Mr. Dillon concurred with Mr. Luns in respect to the dangers inherent in a special political grouping in NATO. This was a grave problem indeed, Mr. Dillon said, but there are various ways of avoiding it.

The conversation ended in a brief but optimistic discussion of French economic strength.

The discussion of other subjects is being reported separately.

0. Source: Department of State, Central Files, 440.002/9–2959. Confidential. Drafted by Chadbourn.
1. Luns was in the United States to attend the 14th Session of the U.N. General Assembly and the annual meeting of the Board of Governors of the International Monetary Fund.
2. In his discussions with Herter, Luns expressed concern that the French-Italian effort to organize consultations among the EEC nations posed a serious threat to the NATO structure. He also pressed for U.S. support for the proposals of the EEC Special Committee on Association which Hallstein presented to the European Parliamentary Assembly during its September 1959 session. The “Second Hallstein Report” offered to extend the EEC’s lower tariffs and increased trade quotas to all OEEC states on a reciprocal basis as of January 1, 1960. The memorandum of this conversation is in Department of State, Central Files, 840.00/9–2959.
3. The suggestion for political consultations within the Six had been made by the French. After initially suggesting three-power (France-Italy-Germany) discussions, the French, at Italian instigation, proposed quarterly meetings of the six Foreign Ministers.