611.5131/1021: Telegram
The Secretary of State to the Ambassador in France (Straus)
491. Your 908, December 6, 11 a.m. Department much appreciates your comments on its proposed aide-mémoire and glad that its main substance is in accord with your ideas. The text was discussed fully with Howell, and seemed to meet his views except in regard to the method of presenting the question of the double taxation treaty.
As for the matter of the double taxation treaty the Department intends in its oral statement to give serious emphasis to the question and to make clear to the French Government that it feels that this Government has already made every concession that might be asked for on that account and that it would deem it unfair of the French Government to use the question of ratification of the treaty as a means of bargaining with us, and that we will not consent to have it enter as an element in the conversations. But my judgment is that it remains wise to avoid making the ratification of this treaty an explicit condition prior to trade negotiation with the French Government provided the trade concessions offered are satisfactory. It is doubtful [Page 188] whether the President’s power to negotiate commercial agreements would justify such a stand.
The Department has decided to use the third paragraph as drafted rather than the briefer and blunter substitute which you suggest. It appears desirable to seek to continue effort to find a ground of agreement with the French Government satisfactory to us and it might assist in doing so if we indicate, as we do in the third paragraph, the general terms which would be satisfactory. This positive indication of what we would seek from the French seems preferable to a completely negative statement.
As for your comment on the proposed oral addition in regard to a possible Modus Vivendi, Department believes your judgment that the French Government would not offer us what we ask is probably correct. But this further indication by us that we will desire in effect most-favored-nation treatment may serve a useful purpose, coupled as it is with an indication that France may not receive the benefit of tariff reductions made by this Government in the course of commercial negotiations with other countries. The reason for this is that our objective throughout our trade agreement program must be to bargain most-favored-nation treatment including generalisation for substantial most-favored-nation treatment, and thereafter trade concessions for trade concessions. I hope you may avail yourself of any opportune occasion to preach this doctrine.