Foreign Relations of the United States, 1952–1954, General: Economic and Political Matters, Volume I, Part 2

460.509/12–953

Memorandum by the Director of Foreign Operations (Stassen) to the Secretary of State

secret
informal and personal

Washington, December 9, 1953.

• Subject:
• East-West Trade

Supplementing our informal discussion on December 2nd¹ and pursuant to your request, I am submitting informally in memorandum form for your consideration the suggestion regarding East-West trade policy.

1. It is suggested that a very different and far-reaching alternative policy to our present East-West trade control policy is worthy of intense and prompt study. The new policy is not recommended by this memorandum, but the study of it by the Planning Board of the National Security Council is recommended for your consideration.

A. Announce that in a major effort to move the world toward peace, trade would be resumed with the Soviet and with China, and with all Soviet Bloc countries in everything except the direct military and highly strategic mandatory items of the Battle Act, and that all free nations are encouraged to do likewise.

Preliminary consideration gives rise to these thoughts of advantages and disadvantages:

Advantages

1. It would be a dramatic initiative with a large impact on world public opinion.

2. It would multiply the contact through the Iron Curtain and broaden the relationship of Soviet Bloc residents with free nations residents.

3. The voluntary cooperation of the free nations with each other and with the United States would be easier to maintain.

4. The economic ills which arise in the free nations would not be blamed on United States control policy and the Soviet would have greater difficulty in stirring dissension toward the United States.

5. The Soviet may find it more difficult to retain their internal cohesion through coercion in the face of external board multination trade.

6. It may set in motion a chain of events which would finally resolve the grave armed threat now posed by the Soviet Bloc.

Disadvantages

1. If the Soviet commits aggression in the next five years, this broadened interim trade will have somewhat increased its military potential.

2. If the Soviet now has serious internal economic and consumer good difficulties, this new trade would ease their internal problem.

3. The maintenance of an adequate defense posture of the United States and of our associates vis-à-vis the Soviet may become more difficult if free world public opinion eases up as a result of the new trade policy.

4. Competition for trade with the Soviet Bloc may lead to extensions of credit by free nations to the Soviet, and hence a net input of matériel from the West to the Soviet.

5. The integration of Western Europe’s economy may become more difficult to advance.

6. The new policy may seriously divide internal United States opinion.

1. An excerpt of the conversation under reference is in file 460.509/12–453. The pertinent portion of the conversation reads as follows: “Mr. Stassen suggested consideration of the possibility of opening up trade with the Soviet bloc except for actual munitions. We appraised the pros and cons of this and I [Dulles] said I thought it deserved very careful consideration.”