Foreign Relations of the United States, 1961–1963, Volume XIII, Western Europe and Canada

54. Memorandum of Conversation⁰

Washington, November 27, 1962, 10:30 a.m.

SUBJECT

• European Economic Problems

PARTICIPANTS

• United States
  • The Secretary
  • Ambassador Douglas MacArthur
  • Mr. Edmund S. Glenn (LS)
• Belgium
  • Foreign Minister Paul Henri Spaak¹

The Secretary said that there were some questions other than that of the Congo which he wished to discuss with the Foreign Minister. The first one of these affects the future of the Atlantic Community and the Common Market since it involves the whole question of future trade between the European Economic Community and the United States. Secondly, the momentum gained through the partial resolution of the Cuban crisis has undoubtedly provided the Atlantic Community with many opportunities; if such opportunities are not exploited there will result a malaise which will please only Moscow.

The Secretary would also be interested in the Foreign Minister’s interpretation of such questions as the recent French elections, from the point of view of their influence on the Common Market and of the future of trade relations between Europe and the United States. The Secretary is somewhat concerned with these questions and would like to know if there is anything that the Foreign Minister could suggest for US action. The United States has tried to avoid any direct participation in the negotiations between its friends in Europe, since European economic and political integration is primarily a matter for the Europeans themselves and intervention on our part could be misunderstood. Nevertheless, such questions as the entry of the United Kingdom into the Common Market and the question of Common Market agricultural policy, which is protectionist [and] could lead to a possible future trade war between the United States and Europe, are of utmost importance and require attention if serious differences of policy within the Atlantic Community are not to occur.

The Foreign Minister said that he had not yet had an opportunity to congratulate the Secretary on the outcome of the Cuban crisis, where the United States has had a spectacular success. Our policy of acting with firmness but restraint had greatly strengthened the Free World. The Secretary replied we had tried to handle Cuba in a way to avoid having “a wounded bear” on our hands because wounded bears could be very dangerous.

The Foreign Minister is also concerned about the influence of the French elections on the European idea. In regard to future developments he is afraid that, if the UK joins the Common Market, General de Gaulle will no longer be truly interested in the development of the political unification of Europe and furthermore will do nothing to bring life and vigor to the various economic communities. The negotiations on the question of UK participation have reached a crucial point. Recently the questions faced by the negotiators were primarily at the level of technicalities and not those of basic principle. Now, however, a genuine question of principle is being raised in regard to agricultural policy. The Foreign Minister finds it difficult to see how the UK could agree to the proposals put forward by the Six regarding agriculture. He believes that the UK position is right and what the Six ask for is not reasonable. We will see this coming week what the position of France will be. France is, however, in a strong tactical position because she can say that she is merely asking for the implementation of decisions already agreed to by the Six last January. It was in order to achieve such a state of affairs that France has insisted that the agricultural question be resolved before serious negotiations began with the UK. At present the French can say that an agreement on agriculture was reached only a year earlier and that it is impossible to have exceptions for the UK. If the French insist on this approach, the British government will be faced with an exceedingly difficult position, because what the Six are forced to ask is not wise.

The UK has an agricultural system different from that of the Community, and the Community is saying now that the British system must be abrogated to be replaced for the next four years by a different, but still provisional system, which would then be adapted step by step to the practices of the Community. The British answer is that it is absurd that they should replace their present system by another one which would be only temporary; they ask instead to be given four or five years to align their system with that of the Community. This is reasonable, but it is doubtful whether the French would accept it. All the French seek is to obtain immediately all the immediate advantages which can accrue to them from the Common Market in the field of agriculture.

As a matter of fact, it is doubtful whether the very policy which they seek is a wise one from the point of view of agricultural management.

The Secretary remarked that the policy in question is likely to result in the repetition on the part of the Community of all the mistakes which had been made earlier by the United States in its agriculture with overexpansion of uneconomic production.

The Foreign Minister said that the situation is different in the negotiations with the UK from what it was at the time of the negotiation of the Rome Treaty. At that time the Six had the will to succeed. At the present moment it is not certain whether the French really want the negotiations with the UK to succeed. In this light, even the United States policy might have to be reconsidered. U.S. policy has always been that the United States is willing to accept certain economic drawbacks resulting from European integration because of the advantages that flow from the political integration of Europe. At the present moment there exists a distinct possibility of seeing an economic community in which the British, the Danes, the Norwegians and the Irish would participate without any degree of political integration.

The Secretary said that it is quite true that the United States was and is ready to accept certain economic discomforts for the sake of the accrued strength which would be gained by the free world through European political integration. However, the United States is not willing to accept deep economic injury, such as might result from a loss of several hundreds of millions of dollars a year of agricultural sales to Europe. Such a loss would have very serious consequences unless it were overcome first of all by a successful European integration, and then by successful trade negotiations between the United States and Europe. If the hopes of such economic solutions were to be dashed, the result would be not simply a return to an earlier state of affairs but rather a deep injury to the entire Atlantic Community.

The Foreign Minister said that he is also concerned by the possibility of such developments. It was a great mistake to place the negotiations on agricultural policy in the hands of agricultural experts without subordinating it to an integrated overall policy of the European community at world level. The experts arrived at the solution which is always put forward by agricultural experts, that is to say a protectionist system. The Six let them do it because they were so full of admiration for the fact that they had been able to agree on a coordinated agricultural policy, and they did not think sufficiently about the consequences. At present it is necessary for the Six to reconsider their position and to see where they stand not only in regard to the admission of the UK but also in regard to their entire policy. Unfortunately there are deep divergencies of opinion among the Six.

The Secretary asked whether the United States itself should not be doing more to influence the outcome. So far, the United States has always tried to refrain from trying to exercise a direct influence on affairs in which its European friends are more directly concerned than itself. The United States does not wish to be presumptuous by trying to exercise leadership in questions of a more direct concern to Europe. We have sensed a certain reassertion of Europe, which basically we favor; nevertheless we will be prepared to exercise more leadership unless we thought that this might be counter-productive. So far, whenever we tried to exercise such leadership in questions in which we were very directly concerned, such as that of armaments, of Berlin, or of disarmament, we were very conscious of an empty chair, that of France. What, under such circumstances, should be our attitude?

The Foreign Minister said that to conclude the agricultural question he wanted to add that he and Ambassador MacArthur had discussed this on a number of occasions recently. He had requested Ambassador MacArthur to write him a letter on the United States’ preoccupations with regard to this question.² He had received this letter on the eve of his departure for New York and has circulated copies among his colleagues. There were possibilities of action in this area and he would take this matter up with the other members of the Common Market. However, we should make approaches in other European capitals similar to that which Ambassador MacArthur had made to him.

0. Source: Department of State, Secretary’s Memoranda of Conversation: Lot 65 D 330. Secret. Drafted by Glenn and approved in S on December 5. A shorter memorandum of Spaak’s conversation with the President on this topic at 4 p.m. is ibid., Presidential Memoranda of Conversation: Lot 66 D 149.
1. Spaak was in the United States to attend discussions on the Congo at the United Nations.
2. MacArthur transmitted a copy of this letter in telegram 743 from Brussels, November 24. (Ibid., Central Files, 785.820/11–2462)