59. Memorandum of a Discussion at the 281st Meeting of the National Security Council, Washington, April 5, 19561
Present at the 281st Council meeting were the President of the United States, presiding; the Secretary of State; the Secretary of Defense; and the Director, Office of Defense Mobilization. Also present were the Secretary of the Treasury; the Attorney General (for Items 1, 2 and 3); Mr. Amos J. Peaslee for the Special Assistant to the President for Disarmament; the Director, Bureau of the Budget; the Special Assistant to the President for Atomic Energy (for Items 1, 2 and 3); the Director, U. S. Information Agency; Assistant Secretary of State Bowie; the Deputy Secretary of Defense; the Chairman, Joint Chiefs of Staff; the Director of Central Intelligence; the Assistant to the President; Special Assistant to the President Jackson; the White House Staff Secretary; the Executive Secretary, NSC; and the Deputy Executive Secretary, NSC.
There follows a summary of the discussion at the meeting and the main points taken.
[Here follows discussion of agenda items 1–4, “A Net Evaluation Subcommittee,” “Significant World Developments Affecting U.S. Security,” “U.S. Policy Toward Austria,” and “U.S. Policy on Indonesia.”]
5. International Trade, Including Trade Between the Free World and the Soviet Bloc
[Here follows discussion pertaining to East-West trade.] At this point Secretary Dulles once again inquired about the fate of his proposal that we offer the Czechs a large amount of our surplus agricultural commodities. Mr. Allen Dulles replied that this suggestion had not been ignored, but had been considered by the Operations Coordinating Board at a recent meeting. At the time of this consideration the Attorney General had provided an opinion [Page 175] that it would be contrary to the provisions of Public Law 480 for the United States to dispose of agricultural surpluses behind the Iron Curtain.
The President then adverted to the fact that many of the restrictive laws on trade with the Soviet bloc countries had been passed when the country was in a state of hysteria and when the McCarthy problem was at its height. Now that this hysteria had lessened, the President wondered if it would not be sensible to take a fresh look at the wisdom of this restrictive legislation. Secretary Dulles said that he would confine himself to pointing out that it was “ridiculous” for the United States to have a vast pile of economic ammunition, in the shape of surplus food and agricultural products, which we could use against the Soviets but which in fact all we are doing is sitting on. The President expressed emphatic agreement with this observation, and Secretary Dulles went on to point out that the Soviets raise hell with us by their purchase of surpluses from the underdeveloped countries. Why could we not raise hell with the Soviets by offering to dispose of some of our surpluses within the Soviet bloc?
The President then referred once again to his favorite project of making West Berlin a showcase by sending to it a lot of our surplus food, so that the West Berliners would be the sleekest and best-fed people in Europe. The President recalled that somewhere or other he had had a report on this subject, and the report had said that the West Berliners were already very adequately fed.
Dr. Flemming speculated as to whether the time had not come to revive one of the President’s favorite ideas, namely, that the United States should get itself in the position of being able to barter its agricultural surpluses behind the Iron Curtain in return for strategic materials. At the moment, of course, we were completely blocked from this course of action by the provisions in Public Law 480.
Secretary Wilson was inclined to doubt whether the Soviets would barter strategic materials in return for our surplus agricultural products. Admiral Radford warned that if we thus developed trade with the Soviet bloc nations, our allies could well ask us why we were attempting to keep down their own trade with the Soviet bloc.
The President said that in any case he was convinced that the Administration had been much too concerned with what Congress thought about the problem of trade with the Soviet bloc. After all, Congress was primarily moved by political considerations. There was need, therefore, for a new look at the problem of East-West trade generally.
The Executive Secretary suggested that the President might wish to ask the Operations Coordinating Board for a report as to existing [Page 176] legal authority for the United States to trade with Iron Curtain countries and to dispose of agricultural surpluses in these countries. The President replied that he wanted this subject dealt with in the reports from Mr. Dodge and Mr. Dulles scheduled now for the Council meeting on April 19. He wanted all of this put together in one package, together with charts and maps.
Secretary Dulles expressed the wish that the Attorney General review his opinion (referred to earlier) as to the legal authority of the United States to sell or trade its surpluses behind the Iron Curtain.
The National Security Council:2
- a.
- Requested the Director of Central Intelligence, in collaboration with the Departments of State and Commerce, to present a report at the Council meeting scheduled for April 19, showing the pattern of international trade, particularly trade between the free world and the Soviet bloc.
- b.
- Requested the Attorney General to present, at the Council meeting scheduled for April 19, a report on the extent to which the Executive Branch, under existing law, has authority to dispose of surplus agricultural commodities to the Soviet bloc.
- c.
- Noted the President’s request that the Chairman, Council on Foreign Economic Policy, coordinate the presentation of the above reports with the presentation of the forthcoming CFEP report on multilateral controls on trade with Communist China, which is also scheduled for consideration on April 19.
Note: The above actions, as approved by the President, subsequently transmitted to the Director of Central Intelligence, the Secretaries of State and Commerce, the Attorney General, and the Chairman, CFEP.