Foreign Relations of the United States, 1961–1963, Volumes VII, VIII, IX, Arms Control; National Security Policy; Foreign Economic Policy, Microfiche Supplement

477. Memorandum from Feldman to President Kennedy, October 15¹

October 15, 1963

SUBJECT

• Wool trade

I

I have just returned from a meeting of the National Association of Wool Manufacturers. While there, I met with Senators Pastore and Kennedy, Mr. Nicholas Schilling, who is the wool industry representative from the Common Market nations, Mr. Douglas Hood, who is the wool industry representative from EFTA, and industry leaders.

Mr. Schilling and Mr. Hood both told me, in confidence, that they felt that the wool industry of the nations they represent is very anxious to enter into a multilateral agreement like the cotton agreement. Mr. Schilling went farther. He said that the Common Market governments also supported the industry. If the Common Market did not succeed in negotiating a multilateral agreement with quantitative limitations on wool trade, they would probably take action themselves, unilaterally.

It seems to me that we should be prepared to meet with the Common Market and EFTA to develop a position on this question. In the meantime, the American industry would discuss these questions with their counterparts in Japan. Then, sometime toward the end of January 1964, we might have a meeting of all wool producing and consuming nations. This would be of benefit to every nation. The Common Market, which now excludes Japanese wool textiles, would be willing to take some. EFTA would also be willing to reduce its barriers to Japan in exchange for assurances from the United States of a portion of our market. Our wool industry would get the stability that it has sought. With wool textile imports approaching 25 percent of consumption, I believe this is a feasible proposal.

If we do not cooperate in some such procedure, wool textile trade will be a source of friction during the GATT negotiations next year.

II

There was considerable discussion at the meeting about the United Nations conference in March to discuss trade relationships. I believe someone should watch the planning for this very carefully. It has the following potentialities for trouble:

1. If the United Nations takes over some of the GATT responsibilities, we will have a less receptive organization. GATT has no Soviet veto and is less unwieldy.

2. The officials organizing the conference are predominantly from non-industrial nations. The Secretary General is from Argentina, one committee head is from Czechoslovakia, etc. It is not too early to make sure that the interests of industrial nations are protected.

3. If this is a Soviet Union initiative to give them a base from which they can discuss world trade, and an organization in which they can seek economic advantages, we should make certain we have some degree of control over it.

Myer Feldman

Attachment

October 16, 1963

Attached is a copy of a memorandum I gave the President. Item I is very highly confidential. Everyone involved understands that this must not get into the public press. However, we should be prepared to meet with the Common Market and EFTA representatives at the appropriate time. I will mention this to George Ball, and I will continue to follow the progress of the proposal.

Item II has very serious implications. The President asked that a letter be prepared for his signature to Dean Rusk, asking that we develop a policy toward the proposed United Nations organization.

I discussed this with Grif Johnson and with Ken Hansen. We had agreed that the leadership should lie in the Department of State, and Grif Johnson informs me that they are already working on the many problems involved.

I assume, from our conversation, that you will undertake the responsibility for seeing that an appropriate letter to Dean Rusk from the President is sent.

Myer Feldman

1. Wool trade and a multilateral agreement. No classification marking. 3 pp. Kennedy Library, National Security Files, Subjects Series, Trade, General, 10/11/63–11/7/63, Box 309.