Foreign Relations of the United States, 1952–1954, Western Europe and Canada, Volume VI, Part 1

850.33/4–654

No. 208
The Secretary of State to the Secretary of Defense (Wilson)¹

limited official use

[Washington,] April 6, 1954.

My Dear Mr. Secretary: Since my conversation on April 2 with Deputy Secretary Kyes and you,² I have looked further into the question of the availability of funds for the $100 million loan which we propose to make to the European Coal and Steel Community. I find that the only firm amount on which we can now count is the $50 million which your Department has agreed can be transferred from existing military assistance funds. I am informed that as matters now stand, the Foreign Operations Administration does not have the additional $50 million which is required and that by the end of the fiscal year only very negligible funds are likely to become available which could be used for this purpose.³

From a foreign policy point of view, I attach the greatest importance to an early conclusion of the forthcoming negotiations with M. Monnet. Moreover, I consider that this Government is committed to negotiate with him a loan amounting to $100 million. Given these two requirements of the situation, I feel it necessary that we have the full $100 million available upon the opening of negotiations. I would therefore be grateful if you would reconsider the question of the Department of Defense making the full $100 million available from current military assistance funds.

I hope that you will find it possible to agree to the foregoing arrangement. If not, I believe that it will be necessary to take the matter to the President as he has taken a considerable personal interest. I annex an extract from the White House Communiqué of December 23, 1953.⁴

Since conversations with M. Monnet will begin on April 7, we have not much time.

Sincerely yours,

John Foster Dulles

1. Drafted by Palmer and cleared in substance with Merchant, Corbett, and Rand of the Foreign Operations Administration. A notation in the margin of the source text reads as follows: “Ltr signed by Secy Dulles & given to Wilson 4/6/54.”
2. No record of this meeting was found in Department of State files.
3. Rand informed the Department of State of the lack of such funds in the budget of the Foreign Operations Administration in a telephone conversation with Merchant on Apr. 5; the brief memorandum of this conversation is in file 850.33/4–554.
4. Not printed here. For the text of this communiqué, see Department of State Bulletin, Jan. 4, 1954, p. 7.