Foreign Relations of the United States, 1955–1957, Western Europe and Canada, Volume XXVII

360. Letter from Prime Minister St. Laurent to President Eisenhower ¹

Ottawa, January 11, 1957.

Dear Mr. President: I have such happy recollections of that pleasant half-day you were kind enough to let me have with you in Augusta a few weeks ago² that I am venturing to write you this personal letter about a matter that has been giving me much concern.

I came away with the impression that you felt as I did, that the prosperity of your great country was quite intimately linked with that of our much less prosperous but rapidly-developing Canada. Though we are, of course, much more dependent upon what happens in the United States than your people are upon what happens up here, we nevertheless, on both sides of the line, have a better economic climate ourselves when that of the other country is also good.

It is natural and perhaps inevitable that certain things are done in some branches of our respective administrations that you and I do not always know about personally and do not always fit in with our ideas of what might be best for both countries. I am so grateful to you for what you have done in the past that I am venturing to bring to your attention a situation which I hope will prove an occasion for further gratitude.

For several months now there has been growing concern in Canada about the impact of United States surplus disposal activities upon the position of our western wheat producers.

You may recall that, when the present surplus disposal programme was launched, you gave certain assurances that this programme would be administered in such a way as to avoid damage to the interests of friendly countries. These assurances were repeated from time to time by other United States officials and I believe that some of the laws relating to the matter contain safeguarding provisions along these lines. Nevertheless, in many cases the surplus disposal activities of the United States are causing definite and serious injury to Canadian wheat producers.

This matter was raised by Mr. C.D. Howe, Minister of Trade and Commerce, at the last meeting of the Joint United States–Canada Committee on Trade and Economic Affairs held in September 1955.³ As a result of what was said by Mr. Howe, Mr. Benson arranged for officials of our two Governments to meet from time to time. These meetings have provided for useful exchange of views and there were occasions, I am told, when the policies of our respective countries were reconsidered in the light of what was said. The record, however, shows that the pace of U.S. surplus disposal of wheat has been stepped up rather than moderated since Mr. Howe first raised the matter with Mr. Benson.

The result is that the Canadian wheat producer, who is not subsidized, feels that he is being steadily squeezed out of markets by U.S. surpluses which are heavily subsidized or sold on non-commercial terms at the expense of your Treasury.

I know that the farm surplus problem is an extremely difficult one for you and your Administration, as it is for us. I know too that you are endeavoring to find a permanent solution that will avoid the recurrence of embarrassing surpluses. I am taking the liberty, therefore, of bringing to your attention what I am sure is an unintended result of the present activities of some of the United States agencies.

The main reason for this injury is the magnitude of the U.S. surplus disposal programme for wheat. In one way or another, through subsidy, through sales for local currency, through tied-sales guaranteeing a proportion of future wheat markets to the United States, through barter arrangements and otherwise, your wheat is being made so attractive to importing countries that they reduce their purchases from Canada and other exporting countries, which cannot afford to subsidize on such a tremendous scale.

As an indication of the extending scope of these surplus disposal activities, your people are now, I am informed, negotiating a most extraordinary contract involving the sale of United States wheat connected in some way with the payment for certain defense installations in France. Just the other day an announcement was made that the United States is prepared to subsidize sales of agricultural products to Poland.⁴ These extensions of your surplus disposal activities, when added to the already large programme of government-assisted sales, are bound to produce an even more difficult situation for our wheat producers.

I would not ask you personally to look into the details of these operations but perhaps, if you had Mr. Gabriel Hauge ⁵ do so, he could give you an accurate picture of their probable repercussions. If you then felt that my concern is not unwarranted, perhaps a word from the White House to your side of the United States-Canada Committee of officials, who discuss together trade and economic affairs, would assist in avoiding consequences which, I am sure, are not intended and could be quite harmful to our common prosperity.

With renewed thanks for your kind hospitality to my son and daughter and me in Augusta and warmest personal regards,

Yours most sincerely,⁶

1. Source: Department of State, Presidential Correspondence: Lot 64 D 174. Personal.
2. Eisenhower had invited St. Laurent for an informal visit to Augusta, Georgia. The visit took place on December 11, 1956, when the President and the Prime Minister had lunch and played golf. (Eisenhower Library, President’s Daily Appointments) They discussed the imbalance of trade between the United States and Canada, and Eisenhower informed St. Laurent that he had rejected a recommendation to increase the tariff on Canadian ground fish filets. (Despatch 573 from Ottawa, January 18; Department of State, Central Files, 742.00(W)/1–1857)
3. See Document 348.
4. See Document 366.
5. Gabriel Hauge, administrative assistant to the President and member of the Advisory Council on Economic Growth and Stability.
6. Printed from an unsigned copy.