Department of State Atomic Energy Files
Memorandum by Mr. Edmund A. Gullion, Special Assistant to
the Under Secretary of State (Lovett), to the
Secretary of State
1
restricted
[Washington,] March 9, 1948.
Memorandum for the Secretary
Subject: Senator McMahon’s2 amendment tot he Economic Cooperation Bill
(S–2202)
Facts Bearing on the Problem
Section 15(b) of S–2202 provides for the conclusion of
a series of bilateral agreements between the United States and participating
countries as a condition precedent to their receiving assistance under the
Act.
Senator McMahon has now offered the following amendment:
“(e) In addition to the provision required by
subsection (b) to be included in agreements
concluded with participating countries under this Act, there shall
be included an undertaking by each such country to prohibit the
exportation other than to the United States from such country of any
commodity of which the exportation from the United States is (1)
determined by the Secretary of State, the Secretary of Defense, and
the Chairman of the Atomic Energy Commission, acting jointly, to be
inconsistent with the national security, and (2) prohibited by or
pursuant to the laws of the United States.”
The Department of State has followed closely the drafting of all the Section
15 provisions in the Act with the object of insuring that they were
reasonable and did not lay us open to the charge of economic imperialism or
of using the Act to further selfish military or atomic designs. The McMahon
amendment has those defects; and is unnecessary for the reasons expressed in
the attached findings (Part A is restricted, Part B is Top Secret).
Recommendations
- A.
- That the Secretary of State, the Secretary of Defense, and the
Chairman of the Atomic Energy Commission consult together with a view to
getting Senator McMahon to withdraw his amendment, for the reasons
expressed in the attached findings.
- B.
- If the amendment is not withdrawn, that these Departments express an
opinion against it, either, (1) before the Foreign Relations
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Committee or the Joint
Committee on Atomic Energy or (2) by parallel letters to Senator McMahon
and the Chairmen of the Committees.
Findings
The amendment proposed by Senator McMahon is undesirable. Some of the
reservations to it may be expressed openly although with appropriate
discretion (Part A); others (Part B3)
involve reference to secret matters, and there is attached a Top Secret note
with reference to these.
Part A
“Open Comments”
The amendment is undesirable because:
- 1.
- It would appear to the ERP
countries to involve an undertaking to surrender a large degree
of control over their foreign trade. Although the amendment aims
only at atomic energy materials, it could be interpreted to mean
that all exports of all ERP
countries were subject to a check imposed by this country. This
seems to be a needless invasion of national sovereignty.
- 2.
- The countries most likely to be in a position to supply atomic
equipment desired by Eastern Europe, other than fissionable
material, would be Sweden and Switzerland. These countries would
be particularly antagonized by such an amendment, conflicting,
as it does, with their neutrality philosophy. Switzerland is
participating in the program almost solely on the basis of
Western unity. She will not receive any assistance under the
Act; therefore, it is not clear that she would be required to
enter into a bilateral agreement containing any conditions.
Accordingly the amendment may not even touch Switzerland. Sweden
derives relatively little benefit from the European Cooperation
Act. It is conceivable that these countries would actually
reject or limit participation in view of this amendment. If this
should happen they would increase rather than diminish their
trade with Eastern Europe.
- 3.
- In the European press and radio the Communists are saying that
the Economic Cooperation Program is in reality a device by which
the U.S. bargains relief of Europe, against a continuation of
our atomic monopoly. Stipulations of the kind envisaged by the
amendment would give powerful corroboration to Communist
propaganda in Europe.
- 4.
- The amendment could be held to apply to a far wider range of
items than those narrowly considered to be military; as drafted
it would appear inconsistent with section 15(b) (3) which provides for
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reducing trade restrictions among
participating countries and other countries in the following
terms:
“(3) cooperating with other participating countries in
facilitating and stimulating an increasing interchange
of goods and services among the participating countries
and with other countries and cooperating to reduce
barriers to trade among themselves and with other
countries;”
- 5.
- The amendment would not produce the effect intended. The only
materials the export of which is currently “prohibited” by law
are fissionable materials within the meaning of the Atomic
Energy Act of 1946; it is probable that the AEC even has authority to export
these materials under certain conditions. There is no export
prohibition in U.S. law on any material whatsoever; there is
only a system of export control under which denial of export
licenses is permissive. Therefore if prohibition of export under
U.S. law is made the test by which exports from participating
countries are to be controlled, then the security produced by
the amendment is illusory. Moreover it makes no provision for
that selective application for which the system in this country
is designed. The latter is flexible: For example, under it
commodities A, B, and C might be shipped to country X; however,
only A and B could go to country Y; and to country Z, possibly
neither A, nor B, nor C could go. The amendment would hinder the
development of a strong, mutually-reinforcing, economic security
bloc of ERP nations.
