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

Conference files, lot 59 D 95, CF 100

No. 329
Memorandum by the Secretary of State of a Dinner Meeting Aboard the S.S. “Williamsburg” on the Evening of January 5, 1952¹

top secret
TCT CONV–1

[Washington,] January 8, 1952.

Participants:

• U.S.

  • The President
  • Secretary of State
  • Secretary of Defense
  • Secretary of Treasury
  • Ambassador Gifford
  • General Bradley

• U.K.

  • Prime Minister
  • Mr. Eden
  • Ambassador Franks
  • Lord Ismay
  • Lord Cherwell
  • Mr. Harriman

[Here follows a table of contents.]

This meeting was most successful. The atmosphere was excellent. Its general effect on Mr. Churchill can be gathered from two remarks; one which he made toward the close of the evening to the President; the other was made to me in private as he was leaving the ship. At the table at the end of the evening he said to the President that of all the meetings which he had attended in his career as Prime Minister with his American colleagues he had never attended one in which he thought the atmosphere was so conducive to close and cordial relations between two countries as the one upon the Williamsburg. To me he said, “Did you feel that around that table this evening there was gathered the governments of the world—not to dominate it, mind you—but to save it?”

The evening fell into four main parts: the discussion before dinner; the discussion at dinner; and two separate discussions after dinner.

Before dinner, the discussion fell into various groups sitting around the aft saloon. At the outset the Prime Minister presented the President with a model of the Mayflower made from the original wood, a book describing the history of the model, and a copy of Mr. Churchill’s latest volume. The President presented the Prime Minister with a set of photographs of the Potsdam Conference and with a set of glasses, one of each type, from the Williamsburg, bearing the Presidential seal.

The discussion then fell into small groups, the President and the Prime Minister talking by themselves.

I talked with Mr. Eden. We mentioned three matters.

The first one was the European Army. He said that they wished to do everything they could to be helpful. He thought that, in spite of Mr. Churchill’s personal opinions, he would play a helpful part. He briefly described to me the meetings in Paris,² the luncheon with Eisenhower,³ and the press communiqué,⁴ which he thought had been useful. I gave him a brief review of the Paris meetings of the six ministers with which he was not at all familiar, pointing out some of the points of difference between the Benelux group and the French and Germans and Italians.⁵ I said that I thought that they would have strong British support for their attitude and that the most immediate and necessary task was to have the British make it clear to them that they should make concessions in the direction of the three larger powers, pointing out that what was at stake here, as Adenauer had said in Paris, was the creation of either a combined European army or of a separate German national army, war ministry, and general staff. The latter would not be tolerated either by the Germans or the French. Mr. Eden assured me that he would be helpful and would wish to discuss this further.

I then brought up the Egyptian matter, saying that we were on dead center. Something new had to be introduced. That something new seemed to us to be concessions revolving around the title of the King of Egypt as the King of Sudan. I thought that the British could concede this without injuring themselves and that this, with some further exploration of the four-power proposals, might break the deadlock. Mr. Eden said that he had no objection to the title. That was not the issue. The problem in the minds of the British Government was whether acceptance of the title involved recognition that the 1899 regime was over and that the regime and constitution contained in the Egyptian statute of abrogation was in effect. In other words, he said, it was the whole basis of the present regime in the Sudan. He said that we would have to study this matter together and see if some solution of it were not possible.

The third matter we discussed was Iran. He was under the impression that the Bank was making progress. I told him that the latest reports showed that the Bank had made no progress; that Mossadeq had returned a clever, insulting, and unhelpful letter to the Bank; that the Bank’s letter seemed to me to be an unwise one and that neither the British Government nor the Bank had yet wrestled with the fundamental and central question, which was the matter of the price of oil. I told him that the Bank’s representatives were returning from Iran and that their own appraisal of their own previous efforts was that these efforts had been highly unrealistic. He asked to see recent communications and wishes to talk about this with us very seriously.

During dinner I sat at the opposite end of the table from the President between Lord Ismay and the British Ambassador. I could not hear the discussion at the President’s end of the table, but I believe that General Bradley and/or Secretary Lovett will make some report upon this.⁶

I brought up during the dinner one matter with Lord Ismay, which is worth reporting. This had to do with problems which the British Government raised for us in our relations with the Commonwealths. I said that on many occasions, the most recent of which were the discussions with the British regarding wider sanctions in Korea should the armistice be broken, we had begun discussion with the British Government on a highly confidential basis only to find that they were taking up with the Dominions the matter under discussion. This immediately produced resentment against us, though not against the British, on the part of some of the Dominions, particularly Canada and Australia. I said that we could not continue to operate in this way. These Dominions were independent, sovereign countries, whose relations with us were of very great importance. We had enough difficult points without adding the wholly unnecessary one of prestige. They resented deeply having us deal with them through London. They also resented the fact that they were not approached at the same time we approached the British Government on questions where they had even more at stake than the British did, as in the present armistice in Korea. The only way I could see to solve the question was to have new and clearly understood ground rules. These would have to be that, if we wished to discuss a matter with the British, we would ask them whether they intended to take the matter up with the Dominions. If they said that they were going to do that, then we would take it up with the Dominions at the same time we took it up with the British. If they said that they were not going to take it up with the Dominions, they must rigidly adhere to this rule. The only alternative was for us to discuss all matters with the Dominions at the same time we discussed them with the British.

Lord Ismay seemed to be utterly dumbfounded by this situation. He thought that the normal way to deal with the Dominions was from Washington to London to the Dominions. Ambassador Franks assured him that this was not the case. He also assured Lord Ismay that it was next to impossible for us to be having any important discussion with the British Government without the Dominions learning of it. Their Embassies in Washington were large, well-staffed, and active. Ambassador Franks thought that this was a major question and required Lord Ismay’s immediate and serious attention. Several times during the later part of the evening Lord Ismay referred to our talk as the disclosure of a vast, new problem, the existence of which was utterly unknown to him.

After dinner the President and the Prime Minister withdrew to the aft saloon on the upper deck. After about twenty minutes they sent for Mr. Eden and me.

When we arrived, the President told us that he had been having the most useful talk with the Prime Minister and that he now wished to raise a matter which had been troubling him greatly. He said that over a period of time beginning in November, 1950, and running to December, 1951, he was informed by his military advisers, 167 British ships had been in trade with communist ports in China. He was not, he said, including in this ships trading with Hong Kong, but ships trading from any port, including Hong Kong, and Chinese communist-held ports. These ships carried about 350,000 tons of cargo a month. The British ships accounted for a little over one-half of all non-communist flag ships trading with Chinese ports. Altogether the British and other non-communist ships imported into China as much as the whole trans-Siberian railroad transported. He thought that this was a contribution to the Chinese military power in Korea and was an indirect way of furnishing the enemy material with which to carry on the war. He asked for the cooperation of the Prime Minister and Mr. Eden in stopping this trade.

They both expressed surprise at the figures given, stated that they had only been in office nine weeks, and did not know of this, and would do their best to look into it immediately and take remedial steps should those be shown to be necessary.

The President directed me to give Mr. Eden the information in whatever detail we had it so that they might check on it. (Admiral Dennison, upon the President’s instruction, has given me the material from which the President’s statement was made, and I am preparing a memorandum for Mr. Eden.⁷)

At this point, I said that I wished to raise a related matter which had to do with bringing our policies vis-à-vis Japan’s relation to Formosa in line. I pointed out the trouble which existed in Tokyo, saying that the Japanese Government wished to make an arrangement with the Nationalist Government relating to the establishment of peaceful, political, and trade relations between Nationalist-held areas and Japan, but that they did not propose to recognize the Nationalist Government as the Government in control of the mainland, or at this time to take any steps regarding Japan’s relations with the mainland of China.

Mr. Churchill said that he had gone along with the Labor Government’s recognition of China, since he was under the impression that we were withdrawing from China and he saw no other practical course. However, he thought that the Labor Government’s policy as they had later pursued it was wrong.

Mr. Eden spoke rather strongly against our view that the Japanese Government could or should enter into relations with Formosa, because he believed that this would prejudice any future relations with the mainland and would inevitably give rise to the view in Japan that we were forcing this attitude and would thereby have a bad reaction against us. He also thought that this violated the agreement with Mr. Morrison.

I pointed out what the nature of the Dulles–Morrison agreement⁸ was; that it related to Japan’s long-run relations with the mainland, with which we were not now dealing, and, in effect, said that those should be left for action after the occupation had ended. I pointed out that at the present time SCAP had withdrawn all control over most of Japan’s foreign affairs and that, with the knowledge and approval of the British, the Japanese were now engaged in making treaties with New Zealand, Australia, Indonesia, and the Philippines. All of these negotiations were for the purpose of easing ratification of the Japanese peace treaty by the Parliaments of those countries. I saw no reason why the Japanese should not be free to enter into the same sort of arrangements with the Nationalist Government which were quite essential for the purpose of getting ratification by our Senate. Mr. Churchill thought that this was more of a point than Mr. Eden appeared to. However, the President and Mr. Churchill instructed Mr. Eden and me to work this thing out and reach a satisfactory solution of it. This we said we would do.

Mr. Churchill then said that he wished to say a word or two about the Middle East. He agreed that we were carrying a great burden in the Pacific and that the British not only should not take steps which made our task more difficult but should do their best to help us. He said that they were, in their turn, carrying a great burden in the Middle East. He thought that we should take steps in this area which could be of great benefit to them by giving them full support. For instance, he said that, if we would put only a brigade of troops into Suez, the British could withdraw a whole division or more. This one step would indicate such solidarity between us that the Egyptians would stop their unlawful conduct and get on with the four-power discussions. Similarly, in Iran, if we undertook to give financial support to the Iranians, the problem would never be solved. Whereas, if we would stand solidly with the British, the Iranians would come to terms in short order.

The President replied that he hoped that Mr. Eden and I would give close attention to Middle Eastern problems. These could be discussed at the larger meetings and he hoped and believed that satisfactory solutions could be reached.

At this point the small meeting broke up, and we rejoined the larger company in the dining saloon, which had been cleared. Here we sat around the table. After a few opening words, the President asked the Prime Minister to give us the benefit of his reflections on the state of the world, with particular reference to the central point of East-West relations; that is, the attitude of the Soviet Union.

The Prime Minister spoke for five or six minutes. He said that he thought the central factor in Soviet policy was fear. He said that they feared our friendship more than our enmity. He hoped that the growing strength of the West would reverse this, so that they would fear our enmity more than our friendship and would be led thereby to seek our friendship.

He discussed the development of American power; mentioned again that the existence of the atomic superiority of the United States was the main guarantee of peace; stressed the necessity for the closest possible alignment of policy between the United States and the United Kingdom; praised the NATO developments and the work of SHAPE; again referred to the need for American support in the Middle East, including a reference to the brigade mentioned above; and said that Far Eastern policy would require the deepest study and united action. He spoke in glowing terms of President Truman’s decision to go into Korea and thought that that had been the turning point in East-West relationships.

The President then asked me to lay what facts I wished to before the meeting.

I said that what I would do would be to express a few views, but chiefly would lay out what I thought were the main problems; and I hoped Mr. Eden, as well as the other members of the British group, would give us their thoughts about them.

I said that so far as the Soviet Union was concerned, it seemed to me that the heart of the matter was the concern of the regime to maintain itself in power, first in the Soviet Union, and then to maintain its influence in the satellite areas. I did not think that our greatest danger lay in the possibility of a mass attack on Western Europe but rather in creeping actions taken through satellites in parts of the world which would exhaust the Western powers, such as was now taking place in Indochina. It seemed to me, therefore, that the main lines of military policy, as laid down in the TCC reports,⁹ for 1952 and 1953 were correct; in other words, not to attempt to create forces beyond the capacity of ourselves and our allies to maintain, but to create sufficient force to make any action by the Soviet Union in Europe too dangerous to be attempted.

So far as Europe was concerned, it seemed to me—and I asked for the views of the British—that the next forty days presented the most critical time, in which we would either take favorable action on three main matters, or would suffer a serious setback. These were:

1. The relations with Germany, where the central points of difficulty revolved around the amount of the German contribution and its use. A second point of difficulty was the French desire, sometimes supported by the British, to impose limitations on production in Germany, which had two very harmful effects: one was to prevent Germany from being received as an equal partner in the defense of the West, and the other was to throw an altogether impossible burden upon American production to furnish items, many of which could be produced through the German industrial organization.

2. The second vital matter was the European Army. Here I briefly outlined the issues as I mentioned them earlier to Mr. Eden.

3. The third matter was the TCC report.

I asked whether there was any doubt in the minds of the British that these three matters must be resolved favorably by the middle of February if we are to maintain forward movement in Europe.

In regard to the Middle East, I said that I thought that here we had a situation which might have been devised by Karl Marx himself. It was right out of his book. Vast masses of people in a state of poverty; practically no middle class—that is, small property owners or businessmen; a small owning and governing class, incompetent and corrupt; and foreign influences, against which agitators could arouse the population, which, after being aroused and destroying foreign influences, could be used to bring about a communist regime. I thought we must jointly devise some way of acting in this situation other than by merely sitting tight. I said that we could have the most perfect mutual support and understanding, but that, if it were reached upon present policies, we would be like two people locked in loving embrace in a rowboat which was about to go over Niagara Falls. I thought we should break the embrace and take to the oars. This amused the Prime Minister.

In the Far East I thought that we had taken energetic steps to get something started in the direction of creating some real power in the Far East. This centered about Japan and our arrangements with New Zealand, Australia, and the Philippines. The operation in Korea had been sound and successful. However, we were faced with the most grave and perplexing problems about China. I thought that we had to analyze the possibilities of Chinese action in South East Asia and make up our minds whether we are going to resist if that was possible or accept the consequences of not resisting if resisting was not possible. I said that the President’s advisers had not come to any conclusions and had not laid any conclusions before him. The matter was open for the fullest discussion, and it would be most helpful to have British views.

The President then asked Mr. Eden for his opinions. Mr. Eden said that he agreed with me about the attitude of the Soviet Union and the correct steps to be taken in Europe. He said that we must understand that historically the Benelux countries had looked to the sea rather than internally into Europe. They were deeply interested in and attached to NATO. They regarded European federations, including the army, as something which was an adjunct to NATO, and which was desirable only as such. They looked with apprehension upon being absorbed into Europe should our interest in Europe wane. He thought that to make progress with them, to induce them to join the European Army, we should make very clear our continuing interest in NATO and in moves to support and strengthen NATO.

In the Middle East he did not add very much to what Mr. Churchill had said. However, he saw some hopeful signs in Egypt. These chiefly were the appointment of the two advisers to the King. He hoped that saner policies would triumph in Egypt, and he thought that American support of the British attitude would greatly help in bringing this about. He said that in Iran he had believed that matters were progressing satisfactorily and was surprised and disturbed to learn from me that I did not agree. He wished to look into this more closely with me.

I believe he did make some observations about the Far East, but I cannot recall them, and think that perhaps General Bradley may have covered this in his notes.

Mr. Snyder, at the President’s invitation, said that he thought that the economic and financial basis of the West required the closest possible attention. He thought that in some of the countries there were signs of persistent and deep-seated malady. He did not believe that applications of ointment and iodine were going to correct these maladies, but that they required real diagnosis and perhaps surgical treatment. He would be glad to consider these in the coming meetings.

Mr. Lovett gave an excellent review of the progress of the American re-armament work, starting with the initial appropriations in 1950 and coming down to our present situation. He pointed out the increasing rates of production and projected these into the future. He pointed out the importance of our creating additional production lines. General Bradley made full notes of Secretary Lovett’s comments, and what the Secretary said was followed with the closest attention by the Prime Minister. General Bradley supplemented some of Mr. Lovett’s observations.

Speaking after Mr. Lovett, Mr. Harriman addressed himself to the subject of the European Army and European integration. He said that Britain had very great influence on the continent. All of the countries looked to Britain either for leadership or for encouragement when they undertook initiatives of their own. He thought that in the past few years since the war British influence had tended to discourage the essential movements toward unity on the continent. He was delighted to see a change in this attitude at the time of Mr. Churchill’s and Mr. Eden’s visit to Paris.

He then spoke of the current discussions in regard to the European Army and said that, regardless of one’s views, about the European Army, it was the only method by which we could now get a German contribution, and he thought it was essential for British influence to be used on the Benelux countries to bring about an agreement.

Lord Cherwell was the last person to speak and directed his observations to the British financial and economic situation. This seemed to him to rest entirely upon the thinnest of the British reserves. Britain was in the position where considerable swings resulting from changes in the terms of trade appeared to him inevitable. If Britain had adequate reserves, this did not produce too serious a problem. In the absence of such reserves, it would produce critical situations. He believed that there was a fruitful field of cooperation in the adjustment of American purchases, prices, stockpiling, etc., in such a way as to assist Britain during times when it was suffering as a result of adverse terms of trade.

This brought the business of the meeting to an end, and after a few moments of general conversation the President’s guests departed.

1. The memorandum also bears the date Jan. 6, presumably the date it was drafted by Secretary Acheson. For another account by Acheson, which closely follows the source text and is probably based on it, see Acheson, Present at the Creation, pp. 597–600; for General Bradley’s account of the meeting, see his notes, infra.
2. Eden is referring to Prime Minister Churchill’s visit to Paris, Dec. 17–18.
3. During the visit to Paris Churchill had lunch with General Eisenhower on Dec. 18; no record of the discussion during the luncheon has been found in Department of State files.
4. For the text of the Anglo-French communiqué, issued on Dec. 18, see the New York Times, Dec. 19, 1951, p. 24.
5. For documentation on the Foreign Ministers meeting of the countries participating in the conference for the organization of a European Defense Community, held at the end of December, see Foreign Relations, 1951, vol. iii, Part 1, pp. 980 ff.
6. General Bradley’s account of this meeting is printed infra.
7. Not further identified.
8. For documentation on the Dulles–Morrison agreement relating to Japan’s future relations with China, made in June 1951, see Foreign Relations, 1951, vol. vi, Part 1, pp. 1039 ff.
9. For documentation on the reports of the Temporary Council Committee (TCC), see vol. v, Part 1, pp. 203 ff.