500.A15A4/1241: Telegram
The Acting Chairman of the American Delegation (Gibson) to the Secretary of State
[Received July 5—8:55 p.m.]
305. Your 168, July 2, 9 p.m., section 2, point F. While no mention of limitation of expenditure was made in the President’s plan it was included in my opening statement as point 9 of our proposals as follows:
“9. We are prepared to consider a limitation of expenditure on material [matériel] as a complementary method to direct limitation, feeling [that] it may prove useful to prevent a qualitative race if and when quantitative limitation has been made effective”.29
In meeting of the Bureau this afternoon (see my 304, July 5, 10 p.m.) British, French and other speakers referred to a limitation of expenditure as one of the accomplishments of a Conference. From all our conversations we are convinced that some form of global expenditure limitation will be one of the points on which other states can unite and which other states will insist on including in any resolution such as outlined in our 296. For example: The French tell us they favor a 10 percent global expenditure reduction.
In private conversations we have ascertained that it is generally considered that a reduction on expenditure is envisaged as applying to budgets of past years or of the past year, in other words, that the reduction to be agreed upon should reflect the reductions already made in most budgets for the coming year due to the force of circumstances. Furthermore in our discussions with the British and French they both understood and individualize Senator Swanson’s position that exception must be made for the right of a state to build up to that level which is accorded that state by international treaty.
In view of this situation and in order to avoid putting the United States in the position of vetoing a measure of arms limitation in which the rest of the world can acquiesce we most respectfully request that you will give further consideration to your decision.
We submit below a possible text of a paragraph for the proposed resolution upon which we might take our stand:
“The Conference is in agreement that the savings effected by the reductions in, or abolitions of, various types of armament material should be reflected in reduced expenditure on the part of the various [Page 269] powers in order to prevent qualitative competition when reductions have been effected.”
Urgent reply requested since discussion of the draft resolution will begin tomorrow.