93. Memorandum of Conversation1

SUBJECT

  • EEC Crisis

PARTICIPANTS

  • United States
    • Under Secretary Ball
    • Mr. David H. PopperRPM
    • Mr. Walker GivanWE
  • Italy
    • Sergio Fenoaltea, Ambassador, Embassy of Italy
    • Mr. Rinaldo Petrignani, Counselor, Embassy of Italy

The Ambassador thought Mr. Ball might be interested in a telegram he had received from Rome giving an “objective evaluation” of the EEC crisis. According to the message as read by the Ambassador, all institutions of the EEC, and all member governments except the French, had agreed on the package proposal of the Commission re: CAP, financing through a common external tariff and increased powers for the European Parliament. All had held fast to that position except Spaak who said Belgium could not accept new commitments as long as they had a caretaker government. A revised transitional arrangement proposed by Italy was supported by the Germans and Dutch but rejected by the French. It was true that the EEC Council had failed to meet the June 30 deadline as the French had wished, but this date had no “final value.”

Nevertheless, according to the Foreign Office telegram, despite the pessimistic atmosphere created by the French, the Brussels discussions had been useful and had provided a basis for continuing activities in the Commission and the Council. The GOI wishes to continue these activities and all the more so since Italy has succeeded to the chairmanship of the Council. The GOI therefore hopes the other members will act according to a European line of conduct.

Commenting that the telegram provided a “less dramatic” interpretation than did the press of events in Brussels, the Ambassador asked what the Under Secretary thought of French intentions. Mr. Ball replied that he assumed the French intended to forestall any supra-national elements [Page 226]from developing in the EEC.2 Confronted with the January 1 deadline for a weighted-majority voting system, the French wanted leverage and calculated that this was as good a way as any to get it. In response to the question whether he thought the French were prepared to destroy the Common Market, Mr. Ball said the matter had now reached the poker game stage. It would seem that the French are counting on the other five to draw back. The Ambassador said he agreed and, speaking personally, he thought the French had the easier position. They can threaten to destroy the Common Market, which Italy and Germany are not free to do.3

  1. Source: Department of State, Central Files, ECIN 6 EEC. Confidential. Drafted by Givan on July 19, cleared by Popper and RPE, and approved in U on July 22. The meeting was held at the Department of State. The source text is labeled “Part II of II.”
  2. In a memorandum for the Secretary of State’s staff meeting on July 7 Leddy reported:

    “The current crisis in EEC relations came to a head over a technical agriculture question but the real issue is supranationalism. When the EEC Commission interjected the latter issue into the forum, the French seized it for their own purposes.

    “The current internal EEC struggle is likely to last through this year withthe end result of De Gaulle getting about what he wants. Meanwhile the outlook for the Kennedy Round has been adversely affected by this development because of the inability of the EEC to proceed with its planned agricultural offers.

    “We are maintaining a public posture of non-involvement in this dispute.” (Ibid., ORG S)

    In a 1-page memorandum to President Johnson for his evening reading on July 7, Rusk gave the same summation and indicated that the Department of State was “sticking to a ’no comment’ line.” (Ibid., S/S Files: Lot 74 D 164)

  3. On July 8, French Ambassador Alphand informed Secretary Rusk that the EEC crisis was serious and that since France had made concessions in the agricultural and industrial policy areas, it could not accept new and unanticipated conditions giving control of funds to the commission and supervisory authority to a parliament that represented no government. France would not seek to undo the progress that had been achieved up to June 30, but would freeze everything as it was, and Alphand offered no timetable on how long it might take to resolve the crisis. Rusk did not comment on the crisis except to say that press reports that it had been manufactured by the United States and the United Kingdom were “absolute nonsense.” (Telegram 147 to Paris, July 9; ibid., Central Files, ECIN 3 EEC)