Foreign Relations of the United States, 1951, National Security Affairs; Foreign Economic Policy, Volume I

S/S–NSC Files, Lot 63 D 351, NSC 111–Kem Amendment

Memorandum by the Deputy Assistant Secretary of State for Economic Affairs (Linder) to the Acting Secretary of State ¹

secret

[Washington,] November 21, 1951.

Subject: Dissolution of the Special Committee on East-West Trade

Problem

The Executive Secretary of the National Security Council has transmitted a memorandum dated November 16² on dissolution of the Special Committee on East-West Trade together with a memorandum form on the subject to be completed by the Department member of the National Security Council.

Discussion

The Senior NSC Staff on November 15 agreed to adopt a memorandum to the Council recommending the dissolution of the Special Committee on East-West Trade. Although the Department had previously at the Senior Staff meeting of October 30 favored the continuation of the Special Committee on East-West Trade on the grounds that it might continue to serve as a forum for discussing matters meriting NSC attention arising under the Battle Act or in connection with other aspects of economic defense, the Department representative at the Senior Staff meeting concurred in the proposal for dissolution of the Special Committee. This change of position was based on the following considerations:

1. The President’s letter of November 6³ formally distinguished the Secretary of State’s responsibilities under NSC 104/2 from those of the Director for Mutual Security under the Mutual Defense Assistance Control Act.

2. The Director for Mutual Security on November 1⁴ announced the establishment of a Mutual Trade Security Advisory Committee to advise him upon matters relating to Public Law 213 (the Battle Act).

3. The Department is now of the opinion that as a result of these two actions it would be preferable for an interdepartmental committee to be established for the purpose of advising the Department with respect to its responsibilities for coordinating economic defense activities under NSC 104/2 other than those covered by the Battle Act. This arrangement would be more satisfactory than the present series of ad hoc interdepartmental arrangements for handling various aspects of NSC 104/2.

In expressing concurrence with the proposal for dissolution of the Special Committee on East-West Trade, the Department’s representative in the meeting of November 15 stated that the Department would work out with the Mutual Security Administrator arrangements for coordinating those functions assigned to the Department under NSC 104/2 which are not affected by the Battle Act. The Department also stated at the November 15 meeting that it had under consideration the establishment of a Committee to advise it on the matters for which it has coordinating responsibilities but that for the immediate future the existing ad hoc arrangements for inter-agency consultation would be continued. No exception was taken to these statements by any agency represented in the Senior Staff.

Recommendation

It is recommended that the Acting Secretary indicate approval of the recommendation contained in paragraph 3 of the memorandum of November 16. In order to formalize the reservation which was noted by the Department in the Senior Staff meeting of November 15, it is recommended that the memorandum form on which the Department’s approval will be noted also contain in the space provided under “Comments” the following statement:

The Department has under consideration the method which will be followed to fulfill its coordinating responsibilities under NSC 104/2 and will advise with the Mutual Security Administrator as to the most satisfactory arrangements to assure the effective accomplishment of these duties insofar as they relate to the duties assigned to the Mutual Security Administrator under Public Law 213.⁵

1. Drafted by Wright and cleared with Vernon, Walmsley, Camp, Hinman, and Stanley D. Metzger of the Office of the Legal Adviser for Economic Affairs.
2. Not printed; it recommended that in light of the President’s signing of the Mutual Defense Assistance Control Act of 1951 the work of the Special Committee on East-West Trade was completed and therefore the Committee should be dissolved. (S/S–NSC Files, Lot 63 D 351, NSC 111-Kem Amendment)
3. Supra.
4. Ante, p. 1213.
5. By memorandum action as of December 8, the National Security Council approved the dissolution of the Special Committee on East-West Trade as recommended in Lay’s memorandum of November 16 (see footnote 2, above). (NSC Record of Action 590, December 8; S/S–NSC Files, Lot 66 D 95, Record of Actions–1951).