560.AL/9–2347: Telegram
The Acting Secretary of State to the Embassy in the United Kingdom
4187. Following is gist of a statement (reurtel 5126, Sept. 23, 5 p.m.) which Brit Amb informs he is making to SEC today. He is also furnishing him copy of Clayton’s aide-mémoire1 and Brit reply:
“I have been kept fully informed of the crisis which has arisen over the Geneva Tariff negotiations. I know from the telegrams which I have received that the Foreign Secretary and his colleagues are disturbed at the possibility of a breakdown, both because it may spell the end of Anglo-American cooperation in the I.T.O. project just at the moment when it is coming to fruition and because of the wider political repercussions on Anglo-American relations and on their respective foreign policies.
[Page 1004]Nevertheless, for reasons which have been communicated fully to Mr. Clayton, we cannot accept the latest American demands for the gradual elimination of preferences any more than we can countenance Mr. Clayton’s quite unjustifiable accusation that we are dishonouring our obligations. Our offers communicated to the United States negotiators in Geneva on 9th September2 in response to their demands of 27th August2 are in our view extremely forthcoming and amply fulfil our obligations. In any case no useful purpose would be served by offering to sacrifice our economic interests in this matter in order to meet the Americans, since political opinions here would unite to reject such an arrangement when it was presented to the House of Commons.
Mr. Bevin hopes that Mr. Marshall, after studying our offers and in the light of the wider considerations mentioned above, will see his way to avoid a breakdown. If however, there is a danger that the United States Administration may nevertheless decide to break off negotiations, Mr. Bevin would be grateful if Mr. Marshall would give me the opportunity before any final decision is taken to present his own and his colleagues’ views on the situation which has arisen and the wider repercussions which might ensue.”