362. Draft Memorandum From Secretary of Commerce Stans to President Nixon 1

SUBJECT

  • Proposal to Realign Economic/Commercial Functions of the Departments of State and Commerce

As discussed with you on April 22 and pursuant to your comments on this subject at the August 12 Cabinet Committee on Economic Affairs meeting in San Clemente, I have been examining the question of State/Commerce operating responsibilities in foreign economic/commercial activities.

My conclusions combined with (1) your experience and expressed wishes in this matter, (2) indications from the business community that a change is desirable, and (3) similar indications from Congressional leaders, lead me to recommend that we proceed with plans to implement Option “A” as described in detail in the attached paper.3 This provides for transfer from State to Commerce of all Washington and overseas economic/commercial functions related to the Commerce [Page 788]Department’s activities (U.S. trade and investment, insurance, business practices, export finance, patents and industrial products and technology) while leaving in the State Department those international economic/commercial functions which relate to the activities of other departments of Government (e.g., Agriculture, Treasury, Transportation).

I am sure you appreciate that this is a controversial matter between State and Commerce and between their respective supporters in Congress and the public. As you also know, there have been a series of proposals, discussions, and representations on this subject—over the past ten years—between the Executive Branch and Congress and between the Federal Government and the business community. I am convinced that action, as recommended, to put our country’s international activities on a more business-like basis would now be in the national interest.

I stand ready to provide any supporting detail that would be helpful in your consideration of this proposal.

Secretary of Commerce4

  1. Source: National Archives, Nixon Presidential Materials, NSC Files, Agency Files, Box 213, Dept of Commerce, Vol. I, 1970. Official Use Only. Stans forwarded the unsigned draft memorandum to Kissinger under cover of an April 14 memorandum in which he noted that Nixon asked him to submit the proposal through Kissinger. Stans sent a copy of the proposal to Rogers the same day, explaining in his covering memorandum that he was considering recommending the changes and had forwarded the draft proposal to Kissinger. (Ibid., RG 59, Central Files 1970–73, ORG 1 COM–STATE)
  2. Stans met with Kissinger from 11:03 a.m. to 12:02 p.m. on April 2. Haig and Under Secretary of Commerce Rocco Siciliano joined them for all but the last 2 minutes of the meeting. (Ibid., Nixon Presidential Materials, White House Central Files, President’s Daily Diary)
  3. Attached but not printed is a 10-page paper entitled “Proposal to Realign Economic/Commercial Functions of the Departments of State and Commerce.” It consists of four parts: I. “The Present Situation”; II. “History of Commerce Overseas Representation”; III. “The Problem”; and IV. “Options”.
  4. Printed from an unsigned copy.