Foreign Relations of the United States, 1964–1968, Volume IX, International Development and Economic Defense Policy; Commodities

187. Letter From the Secretary of the Treasury’s Assistant for National Security Affairs (Albright) to the Deputy Assistant Secretary of State for International Trade Policy (Greenwald)¹

Washington, March 14, 1967.

Dear Mr. Greenwald:

This is in reply to your letter of February 15, 1967 in which you suggest that Treasury now issue a general license to U.S. subsidiaries in COCOM participating countries and to their U.S. officers and directors.² You further indicate the desirability of an early favorable Treasury decision so that State’s reply to an inquiry from the United Kingdom can take into account such decision.

While the Treasury Department has no objection in principle to the issuance of such a general license, you will recall that Secretary Fowler’s letter of December 22, 1966 emphasized the desirability of interagency work looking toward achievement of an agreed U.S. position on the reduction of the items of limited strategic or economic significance which would be controlled with respect to the USSR and Eastern Europe. Our intention was to proceed with Treasury actions only within the framework of a broader policy approach. In the absence of this broader framework, we believe that the limited step of issuing a general license at this time, with its necessary publication, could easily be misconstrued by the public and the Congress beyond its real substance. We should have very much in mind the effects of individual actions or broader new policies on the legislative program now before the Congress relating to East-West trade and other “Bridge-Building” matters.

Further, Secretary Rusk’s letter of December 4, 1966³ and your letter to me of February 15, 1967 indicate that the general license could be useful in advancing U.S. objectives in negotiations with other countries. If this is so, there is some advantage in including this license decision as a part of an over-all package for negotiation with the COCOM governments in which we will be seeking certain understandings from them.

For these reasons we would prefer not to issue the general license at this time. We would be prepared, however, to issue the general license at such time as the legislative sensitivity has declined and a more comprehensive U.S. negotiating position toward our allies has been delineated and the decisions have been made to more ahead.

I am sending a copy of this letter to Mr. McQuade at the Department of Commerce and Mr. Barber at the Department of Defense.⁴

Sincerely yours,

Raymond J. Albright

1. Source: Department of State, Central Files, STR 13–1. Confidential.
2. Not found. However, a memorandum from Robert B. Wright (E/ITP/EWT) to Greenwald, February 21, indicates that Greenwald’s February 15 letter was written out of concern for the Department of Defense’s decision not to take a position on Treasury Transaction Control cases. But because the Department of State doubted whether in practice Treasury would approve cases without the positive assent of Defense, the result of Defense’s “no position” might be bureaucratic inertia and growing impatience among applicants. (Ibid.)
3. Not found.
4. Next to this paragraph is a line drawn to the bottom of the letter where the following comment was written in an unidentified hand: “I think we have to meet with Albright, Barber and McQuade plus someone from W[hite] H[ouse]—Bator? or his office. Let’s talk about an agenda & paper.”