398.2544/1–2554
Memorandum of Conversation, by Francis G. Jarvis of the Office of Philippine and Southeast Asian Affairs
- Subject:
- Tin
- Participants:
- Director of Foreign Operations Administration Stassen
- Secretary of Treasury Humphrey
- Mr. Dudley W. Figgis, Chairman of the U.S. Tin Delegation to Geneva Tin Conference
- Assistant Secretary of Interior, Mr. F. Wormser
- Mr. A. Flemming, Director, Office Defense Mobilization
- Mr. Samuel Waugh, Assistant Secretary of State Representatives of the Departments of Commerce, RFC, State and Other Agencies
Mr. Humphrey asked Mr. Figgis to open. Mr. Figgis spoke in complimentary terms regarding the assistance afforded him at the Geneva Tin Conference1 by Mr. Nichols of the Department of State. Mr. Figgis proceeded to review developments on international stabilization of tin since 1946 to the present. Mr. Figgis noted that while he did not like commodity agreements, he is inclined to support a tin stabilization arrangement to benefit the tin producing countries which the U.S. is temporarily attempting to assist. Sale by the United States of the 35 to 40 thousand tons of tin which the U.S. presently holds above the stockpile goal would be devastating to them. Mr. Figgis noted that in his opinion the Randall Commission Report2 does not rule against U.S. participation in all commodity agreements. (As Mr. Figgis continued it became apparent that he is not opposed to U.S. participation in a tin commodity [Page 1072] agreement.) He then mentioned declining U.S. requirements for tin; titanium will soon be a competitor of tin in the U.S., developing an even more difficult situation for the tin producing countries.
Mr. Humphrey discussed the present U.S. position on tin. He said that the U.S. now holds 40 thousand tons above the stockpile goal for which there is no immediate or foreseeable U.S. need. He continued that the U.S. is also obligated to make a “good faith” offering to Indonesia on a third year contract for 20,000 tons. Mr. Humphrey queried, “What is a good faith offer?” “What does the U.S. do with the sixty thousand tons of tin when acquired?” “What effect, if any, does the sixty thousand ton U.S. surplus have on the ‘pool arrangement’?” “What should U.S. policy be on a tin agreement?” “Should we revise the stockpile goal upwards and add the sixty thousand tons of tin to the stockpile?”
Messrs. Waugh and Nichols stated that the political factors would have to be taken fully into account in any decision which the U.S. takes on tin.
A discussion of about an hour took place on all aspects of the U.S. tin situation and U.S. participation in a tin agreement.
The Department of Commerce representative stated that the Department of Commerce is opposed to U.S. participation in an international tin stabilization arrangement; he disagreed with Mr. Figgis’ interpretation of the Randall Commission Report. The Department of Commerce representative interpreted the Randall Commission Report as opposed to U.S. participation in international commodity agreements.
Governor Stassen then suggested that it appeared to him that the U.S. had three alternatives available to it in tin: (1) to sign the draft agreement, (2) not sign, (3) encourage other countries to go ahead with a producer form of agreement and at the same time ask them to limit tin production. It appeared to be the opinion of the group, that at the same time the U.S. could not give the producer nations assurance that the sixty thousand tons of tin excess to the stockpile goal would be insulated by the U.S.
Mr. Humphrey then suggested that the group take a decision on three points: (1) that the U.S. pursue its present tin policy of smelting the balance of the 40,000 tons; shut down the Texas City Smelter, and then hold the tin metal off the market, (2) authorize the appropriate agencies to offer the Indonesians a fair price for the third year of the Indonesian contract; hold that tin metal off the market, (3) recommend that the U.S. refrain from participating in the “cartel arrangement” developed at Geneva or take no position at this time with respect to the draft tin agreement.
Mr. Stassen again asked the group to consider the alternatives earlier advanced by him.
[Page 1073]It was then decided, at Mr. Humphrey’s suggestion, to adopt the courses of action suggested by him in Items numbered (1) and (2) above and to take no position at this meeting with regard to U.S. participation in a tin stabilization arrangement. On this note the meeting ended.
Comment: As a result of this meeting, Mr. McKinnon of the RFC extended the period of negotiation with Indonesia to the end of February, during which time it is expected he will make the Indonesians an offer. Mr. McKinnon needs a written authority from high levels before he can implement the decision on the Indonesian contract. We expect this authority will be given the RFC as soon as the White House can arrange it, perhaps next week.