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

Bruce Mission files, lot 57 M 38, “Agricultural Pool”: Circular airgram

No. 246
The United States Special Representative in Europe (Draper) to Certain Mutual Security Agency Officials¹

confidential

Paris, November 11, 1952.

A–187. Subj: Recent Developments in European Agricultural Integration.

1. French Cabinet has selected January 20 as opening date for next Paris conference on the organization of European markets for agricultural products. One of the major considerations was date at which tasks of Interim Working Party will be completed and necessity allowing time for study of resulting documents.

2. The Interim Working Party has completed an impressive volume of documentation. Some 15 reports on commodities or commodity groups will be completed by December 15 when the full Working Party will meet. At that time the commodities will probably be ranked in order of priority and perhaps criteria for including commodities within an agricultural integration plan will be proposed as provided in the Working Party’s terms of references. A general report describing the agricultural economy and structure of the various countries, farm income and expenditures, and government measures affecting agricultural production is also being prepared.

3. A group of European agricultural economists has recently been called to Paris for consultation on this report and to consider the problem of inter-country comparisons of farm costs. The group included such outstanding men as Prof. Herring, Dir. of the Dutch Agricultural Economics Research Institute; Prof. Miehaus, Dir. of the Institute for Agricultural Policies and Marketing of the University of Bonn; Mr. Ridder, Dir. of the Danish Institute of Farm Accounting; and Prof. Harraem, Dir. of the Institute of Farm Economics of the University of Gotingen. This meeting was quite an important innovation as European professional leaders in this field had never been brought together before.

4. The Working Party has adhered closely to its terms of reference. The various reports on commodities, “general problems,” and institutions do not draw any conclusions concerning the specific problems of organizing a common market. The documentation will, however, provide useful background material. The participants in the work have acquired a better appreciation of the conditions and problems in countries other than their own and, in a number of instances, have developed a more favorable attitude toward the project.

5. The September 10 resolution of the CSC Council of Ministers² relative to a European Political Community and related economic questions has caused the agricultural leaders of the six CSC countries to intensify their activities with respect to agricultural integration. The phrase “moral obligation to move ahead” or some close equivalent is frequently being used.

6. On the other hand, the decision at the March Preparatory Conference³ on the Organization of Markets for Agricultural Projects to the effect that the entire group of countries there represented would proceed together in the consideration of the problem tends to inhibit action in agriculture by the six countries alone.

7. An exchange of visits by the Ministers of Agriculture of the six countries is currently in progress. The purpose is to reach some agreement as to a procedure which will be consistent with both of the above agreements. Some type of six country meeting prior to the January agricultural conference seems probable. Viewpoints differ as to whether this should be confined to Ministers of Agriculture or should be a meeting of Foreign Ministers attended by Ministers of Agriculture and possibly Ministers of Finance or economics as well. The purpose would be to reach agreement on the type of action to be proposed at January conference taking pains to maintain understanding that the six countries only wish facilitate work of the 16 with no intent create exclusive block or make secret commitments to one another. Kind of plan contemplated for presentation at January conference is procedure for drafting treaty for agricultural community or common market with statement of broad principles or conditions to be satisfied by the plan as a guide for the drafting group.

8. There is a considerable range of opinions among the Schuman six regarding their role among the 16 countries. Dutch view is that six must go ahead in any event, keeping door open to other potential participants but not delaying progress or making compromises which would result in weaker action in order to increase number of participants. At opposite extreme Belgians, while agreeing that the six should provide guidance for the 16, place the emphasis on efforts to find a formula under which all 16 can participate. The Italians are about midway between these extremes.

9. There appears predominance of thinking that agricultural community should not be coterminous with CSC, but larger. It is pointed out that six countries do not form natural unit in which agricultural production is largely concentrated as in the case of coal and steel. This accounts for importance attached by the six countries to avoidance any risk of discouraging wider participation.

10. Prior to March conference, non-governmental interest in agricultural integration largely was confined to farm organization. In recent months labor and industrial groups have begun to give attention to the proposed common market for agriculture and the present attitude of such groups seems to reflect the view that some action toward agricultural integration is going to be taken and that it is time for them to try to exert influence to shape the program according to their respective interests. Allied Mission Labor Officers have encouraged labor interest in the project because of the potential advantages to workers as consumers which would result from a constructive integration program.

At the initiative of the European Regional Organization of the ICFTU, a conference was held in Brussels in late October attended by representatives of two trade union internationals and eight national organizations. The conference unanimously agreed that the free trade union movement in Western Europe should support the creation of a European agricultural community and that trade unions should participate in efforts to attain this goal. A five-man committee has been set up to follow Green Pool developments and to encourage labor participation at the January conference.

11. Individual country positions. The following summary of individual country positions is based on conversations held in Paris and the other capitals visited by SRE representatives as well as upon information received from Embassies and MSA missions. Comments and further information are invited.

The Netherlands continues to be the most ardent proponent of rapid progress toward full integration, and interprets the Luxembourg Resolution as a firm commitment among the six to push ahead in the agricultural sector as an essential part and logical next stage in the broad political and economic unification movement proposed or implied in the resolution. Dutch have also done most analytical work including development of specific proposals, but are waiting for more appropriate time to reveal results.

Italy is also favorably disposed toward full integration under six country leadership, but advocates proceeding much more cautiously and with more attention to broadening participation beyond six countries. Relatively little analytical work has been done on the problem by the Government. The minister has left this largely to Prof. Papi who has no staff assistance, many other duties, and above all, a most cautious and conservative attitude. Considerable interest and support is developing among influential agricultural leaders outside the Ministry.

While the French have not renewed active leadership since Mr. Pflimlin was shifted to his present cabinet post, the official position continues to be an affirmative one. The Minister of Agriculture is being continuously subjected to the prodding of his assistant Mr. Cabot, who is Chairman of the Interim Working Party, and whose enthusiasm for the project has grown as the documentation job has gone forward in a generally favorable atmosphere.

In Germany the official position is favorable, and Dr. Hermes, the Head of the Farmers Union, has been designated to the role of leadership exercised by Ministers of Agriculture in other countries. In view of the strong protectionist elements in German agriculture, Mr. Hermes is in a somewhat precarious position in presenting the official Government position in Paris without weakening his personal standing with the members of the farm organizations which he heads. There are indications that industrial groups favor making industrial integration a condition of Germany’s acceptance of agricultural integration.

Belgium has now taken a formal position in favor of establishing a common market. Socialist Party pressure following successes in recent municipal elections appears to be a factor. But whether this formal support is based on a genuine desire for a common market or merely on tactical considerations is open to question in the light of the strong opposition known to exist in the country. Belgium may well consider that as a member of the CSC she cannot logically or successfully oppose the common market principle, but can insist on such broad country participation as to preclude agreement on anything more than a very weak version of the common market idea.

Outside the Schuman six, Greece and Turkey strongly supported the idea of a common market at the Preparatory Conference in March. As exporters of certain agricultural products they are interested in access to European markets on more favorable terms, but have not indicated the nature of these terms. Denmark has become increasingly interested and is probably prepared to participate fully in the development of a common market plan if convinced that there is a reasonable chance of adoption of a truly liberal plan with satisfactory provisions for trade with third parties. If Denmark participates actively, Norway may decide that it is to her advantage to do so as well. Austria has shown considerable interest, pressing especially for the inclusion of forest products. The U.S. continues an active interest while maintaining that her special position with the Commonwealth rules out U.S. participation in any plan involving surrender of national authority to an international institution. Other participants, with the exception of Ireland and Sweden, have made a serious effort to supply all of the data requested, but have otherwise evidenced only mild interest.

Draper

1. Sent to all MSA Missions (except Belgrade, Madrid, and Reykjavik) and to the Agency in Washington with instructions to pass to the Departments of State and Agriculture.
2. For the text of the “Luxembourg Resolution,” see Document 103.
3. For information concerning the Green Pool meeting in Paris in March, see Document 243.