Foreign Relations of the United States, 1964–1968, Volume XXXIV, Energy Diplomacy and Global Issues

2. Telegram From the Department of State to Secretary of State Rusk in Belgium¹

Washington, June 6, 1966, 1:01 p.m.

Tosec 92. For the Secretary from the Acting Secretary. I recognize the problem of the technological gap between the United States and Europe, but until our ideas on this question have been thoroughly digested I would suggest we play it in a low key.² The technological gap exists primarily because European industrial enterprises have failed to organize themselves on an adequate scale of size and have not developed the practice of investing a sufficient proportion of their sales dollars in research. The Europeans now have a big common market and European firms should be encouraged to consolidate to meet the requirements of that market. At the same time, they should modernize their practices and increase their research budgets.

For us to assist this process by a technological subsidy would, I think, be doubtful wisdom, since it might serve to perpetuate bad European practices. Moreover, a substantial part of our favorable trade balance with the world depends upon our technological superiority and we should not give it away for nothing.

My views on this question are not fully developed and I would not wish to prejudice the evolution of some progress in this field, but I feel that we should be quite restrained in suggesting such a program before we have thoroughly thought it through.³

Ball

1. Source: National Archives and Records Administration, RG 59, Records of the Department of State, Central Files, 1964–66, SCI 1–1 EURW–US. Secret; Nodis. Drafted by Under Secretary Ball on June 6, cleared by John Walsh (S/S), and approved by Ball. Secretary Rusk was in Brussels attending a NATO meeting. After stopping briefly in Bonn and London, he returned to Washington on June 10.
2. Rusk had raised the idea of a “Marshall Plan for Technology” with Italian Foreign Minister Amintore Fanfani on June 5. (Telegram 309 from Brussels, June 5; ibid., SCI 1–1 NATO)
3. Although Rusk made no further offer during this meeting, Fanfani initiated discussions within the Italian Foreign Ministry on June 21. (Telegram 3198 from Rome, June 21; ibid.) See Tab A to Document 4.