RA files,
lot 58 D 374, “CSC Loan
Negotiations”
No. 191
The Director of the Foreign Operations
Administration (Stassen) to the Secretary of
State
Washington, January 5, 1954.
Dear Foster: You will recall the background of the
President’s conference with Jean
Monnet of the European Coal and Steel Community on June
3, 1953, and his subsequent letter of June 15.1
The follow-up conferences with Mr. Monnet in Paris during the NATO meetings2 lead me to make the recommendation reflected
in the attached memorandum.
I would appreciate your preliminary comments prior to firming up the
proposal for the President’s action.
Sincerely,
[Enclosure 1]
Draft Memorandum to the President From the
Director of the Foreign Operations Administration (Stassen)
You will recall your conference with Mr. Jean Monnet of the European
Coal and Steel Community of June 3, 1953, and your subsequent letter
of June 15, and the favorable response of the Congressional
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committees in the matter
of a loan to the Coal and Steel Community.
Subsequent conferences were held in Paris with Mr. Monnet during the period of the
NATO meetings by the Secretary
of State, the Secretary of the Treasury, and myself.
There is legal authority under the present legislation for making
such a loan and I estimate that we will have a sufficient amount of
local European currencies to fund a loan of $100 million.
The total request for the Coal and Steel Community was for $400
million over a period of four years, but I do not believe this large
a loan will be needed or should be made.
It is my judgment that this will be a good loan and that it should
have the security of the assignment of the subsidiary loans to
individual coal mines and other facilities.
The funds will be used for the improvement of coal mines, power
plants, and coke plants, all of which will strengthen the base of
the Western European economy, improve its capability to finance its
own defense, and the entire project will encourage the essential
move toward European integration, which is highly desirable as a
part of your basic policy.
This recommendation is concurred in by the Secretary of State, the
Secretary of the Treasury, the Secretary of Defense, and the
Director of the Bureau of the Budget.
[Enclosure 2]
Draft Memorandum for the Director of the Foreign
Operations Administration (Stassen)
Upon the recommendation of the Secretary of State, the Secretary of
the Treasury, the Secretary of Defense, and the Director of the
Bureau of the Budget, in addition to your own recommendation, you
are directed to proceed with the necessary arrangements to make a
loan to the European Coal and Steel Community in the amount of $100
million.
The loan is to be long-term and is to be made in European currencies
held by the United States with the transfer of the appropriate
number of dollars from the obligational authority of the Mutual
Security Program to the Treasury of the United States.
The terms of the loan and the provision for re-payment in European
currencies are to be approved by the Secretary of the Treasury.
You will also proceed to analyze the question of additional extension
of credit in the next three years and upon the concurrence of
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the Secretary of State,
the Secretary of the Treasury, the Secretary of Defense, and the
Director of the Bureau of the Budget, you will take up the question
of such additional extensions of credit with the Congress during
this session.
You will notify the Secretary of State, the Secretary of the
Treasury, the Secretary of Defense, and the Director of the Bureau
of the Budget, of this decision.
