Foreign Relations of the United States, 1952–1954, Western Europe and Canada, Volume VI, Part 2

U/MSC files, lot 59 D 449, “MAP—Italy (FY 1952–1954)”

No. 736
The Director for Mutual Security (Harriman) to the Deputy Secretary of Defense (Foster)¹

secret

[Washington,] December 23, 1952.

Dear Bill: I refer to my letter of December 1, 1952² on the subject of offshore procurement in Italy, in which I requested that special attention be given to the problem of effecting early and substantial procurement in Italy in view of the extreme importance attached by responsible U.S. agencies to the favorable effect that such procurement activity could have on the outcome of the forthcoming national elections in Italy. I greatly appreciate the careful and thoughtful attention which you and your staff immediately gave to this question.

The prospects for early contract placement in Italy have been discussed in detail between our representatives, and with those of the military services. On the basis of these discussions, I now believe it would be desirable to establish a firm target for the placement of such contracts.

While I recognize that accelerated contract placement in Italy may result in somewhat higher prices for some items than might be the case if time permitted full application of competitive bidding processes, I think the risk of such increased cost, if kept within reasonable bounds, must be accepted in view of the importance of U.S. objectives in Italy. Considering the costly and extraordinary measures taken by this Government in connection with the 1948 Italian elections, the possibility of being required to pay somewhat higher costs on a number of offshore procurement contracts seems a small price to pay for measures that may contribute so directly to political stability in Italy.

In view of the foregoing, I request that the Department of Defense take whatever steps are necessary to assure the placement of contracts in Italy by March 1, 1953, to a total value of $150 million out of FY 1953 funds, exclusive of contracts under the special completed aircraft procurement program. I believe this target is feasible within the Defense Department’s overall plan for end-item procurement, and I am given to understand that it can be implemented without sacrifice as regards quality, acceptable types, or delivery schedules. At the same time, as I have indicated above, I am aware that reaching this target may require the placement of some contracts at less satisfactory prices than would be obtainable, in the judgment of the procurement officers, if speed were not so important. I accept this possibility, while of course urging that every effort consistent with fulfillment of this target should be made to minimize the cost to MDAP funds of accelerated procurement action.

In setting the foregoing target for March 1, 1953, I hope that the total for this Fiscal Year will in fact be substantially above this figure.

I will appreciate it if you will keep me currently informed of the steps which are taken to meet this target and of procurement action which is initiated or completed.³

Sincerely yours,

W. A. Harriman

1. Copies were sent to the Secretary of State, Wood of MSA, Martin of State, and Berger, Ohly, Schelling, and Wiggins of DMS.
2. Document 734.
3. For a summary of Foster’s reply, see footnote 4, infra.