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

611.42321 SL/6–1854

No. 994
Memorandum by the Counselor of Embassy in Canada (Bliss) to the Officer in Charge of Dominion Affairs (Horsey)

confidential

Ottawa, June 18, 1954.

• Subject: St. Lawrence Seaway Negotiation

My telegram No. 174 of June 17¹ covered the St. Lawrence Seaway discussions of that day as completely as I could have managed to do in a telegram, but I feel that you should have a good deal more background which it is the purpose of this memorandum to provide.

Basically, I am sure you understand, the Canadians are vaguely disappointed over the situation created by the Wiley Bill, which has the effect of bringing the United States into the construction and operation of the Seaway after 30 years or more of holding back on our part. In 1952, thoroughly exasperated by the long delays in starting the Seaway, for which our Congress was clearly responsible, the Canadians found themselves for the first time in a sufficiently strong economic position to undertake the construction of the Seaway themselves. The Government was genuinely astonished at the enthusiastic popular approval which greeted the decision, which we accepted in the 1952 exchange of notes.² It is consequently a bit of a disappointment that the United States, a Johnny-come-lately, must now be let into a project which Canadians had come to regard as their own. I have talked to many Canadians about the political psychology of this and they have unanimously agreed with my analysis.

In such discussions, however, I have invariably expressed the view that it would be a political catastrophe if the Canadians were to try to exclude the United States as a participant in the development of the Seaway. Among other arguments I have pointed out that the Seaway will carry by far more American traffic than that of any other country, that its operation is likely to involve a variety of pressures from American business interests, and that it would prevent such pressures from becoming international in their character if the United States were itself involved in the Seaway. In other words, the United States would take some of the heat off Canada in this connection.

I have encountered no Canadians in official or unofficial circles who have argued seriously that the United States should be kept out of the Seaway, although many of them perhaps privately hope that this could be done and would say so to each other. There are persistent rumors that C.D. Howe prefers an all-Canadian Seaway but the Ambassador observes that he has never mentioned this.

At any rate, the Prime Minister seems to regard himself as committed to collaboration with the United States in the Seaway, the majority of the Cabinet agrees with him, and it is established Government policy to go ahead with us. I doubt that anything likely to happen will cause this policy to be reversed. However, we must recognize the existence of the political background I have outlined above and make some allowance for it. This is no time for us to be arrogant.

The Canadian practical approach to the problem, it seems to me, is to proceed with great caution with a view to establishing a framework for the construction and operation of the Seaway which will recognize its importance to both countries and the necessity of establishing a sound and workable basis which will stand the test of time over the next half century. In their view this means that we shall have to re-examine carefully the arrangements of the last few years, including those of 1941 contemplating joint operation³ and those of 1952 contemplating unilateral operation, which will have to be dealt with in the light of a third variation represented by the Wiley Bill.

The new permanent arrangement, they feel, must be negotiated by Governments and must result in an agreement which binds the United States. They would not be satisfied to negotiate with an American executive agency or deal with it except in a framework established by inter-Government negotiation and agreement which would in effect represent the terms of reference for the executive agencies. In connection with this they may want to do some bargaining on the specific agreements for sharing costs reached in the 1952 exchange of notes, but I do not regard this as more than incidental to the fundamental problem.

[Here follows speculation on the views of various Canadian officials on the questions raised by United States passage of the Wiley Bill.]

Don C. Bliss

1. Supra.
2. Reference is to the June 30, 1952, exchange; see Document 944.
3. See documentation on the Agreement regarding the Great Lakes–St. Lawrence Waterway signed Mar. 19, 1941, in Foreign Relations, 1941, vol. iii, pp. 149 ff.