CABINET MEETING, FRIDAY, MARCH 26, 1948
10:00 AM
THE PRESIDENT
Asked Commerce & State to discuss export control.
HARRIMAN
Atomic Energy Comm has own controls. State controls munitions National Defense weapons. The list does not include aircraft engines or obsolete commercial planes. Commerce controls balance of commercial trade. The situation is in Congress' lap as the resisted continuing controls of any kind but granted some which are inadequate. Congress wrecked division controlling exports by failing to provide sufficient funds. The shipments to Eastern Europe & Russia are now being screened very carefully at this time. We are to ask Congress for import controls. This will affect imports of manganese, chrome and some other items we get from Russia. We have not shipped any oil - except lubricants - since last July to Russia. We are trying to get our trade with Russia on a Quid Pro Quo basis.
STATE
Do not think we should give to public a list of significant items to be allowed to be shipped to Russia. Distributed to Cabinet statistics on exports to Russia. In trade agreement with Czechoslovakia we are endeavoring to obtain consent from other nations to terminate the agreement. If we can't get consent we will probably take unilateral action and cut off Czechoslovakia agreement. Read proposed statement which may be issued when trade agreement is cancelled.
HARRIMAN
It is important to let some items contracted for and produced to either go forward or have Congress appropriate money to cover losses; e.g., 20 electric locomotives made by General Electric at cost of 5 million dollars.
CONSENSUS
Let them go forward but accept no new orders.
ANDERSON
Suggested limited stockpile of wheat for emergency purposes.
KRUG
Suggested thought be given to stockpiling minerals.
FORRESTAL
Arthur Hill is doing just that.
STATE
In connection with Bogota Conference it is important to get U. S. funds into Latin America but we must protect whatever capital is put into Latin America. It is important that we treat Western Hemisphere a little different than rest of the world. This is important to Western Hemisphere defense. It is a wise decision to make.
FORRESTAL
Says yes.
KRUG
Once artificial barriers are proposed to American capital it will adversely affect world trade development by tax concessions in favor of the Western Hemisphere.
FORRESTAL
Against tax arrangement in principle but for it in light of present world situation.
STATE
Will listen to opinions of economists but will apparently have to make his own decision.
HARRIMAN
In maritime situation we have a shortage of (1) tankers (20 knot type; program 26 per fiscal year). (2) Passenger ships - these are necessary for National Defense. Contemplate 20 keels should be laid. It is important that 350 million dollars be made available - over half to come from private ship operators, balance in form of subsidy. The program will add about 50,000 employees in shipbuilding industry.
11:07