<--PREV Doc #1018  |  Memorial Commission Home Page  |  First Term Table of Contents  |  Presidential Papers Home Page  |  Doc#  |  NEXT--> Doc #1020 Document #1019; August 12, 1954 To John Foster Dulles Series: EM, AWF, Dulles-Herter Series ; Category: Confidential The Papers of Dwight David Eisenhower, Volume XV - The Presidency: The Middle Way Part V: Maintaining "a united defense"; April 1954 to August 1954 Chapter 11: The "men in the Kremlin are not to be trusted"   Memorandum for the Secretary of State: With further reference to our conversation on lead and zinc–1 I send you herewith a letter I have just this moment received from Senator Watkins.2 The letter is not for publication, but I think that it does indicate a great urgency in the attempt to secure some kind of gentleman's agreement with the principal foreign suppliers of these metals, so that we may undertake some kind of ameliorating efforts here at home that will not be defeated by increased imports.3 Please return this letter to my files. I have already acknowledged its receipt.4 1 Eisenhower had met with Dulles this same morning. On May 21 the U.S. Tariff Commission had reported that "marginal lead and zinc mines" had suffered "serious distress" due to a sharp decline of prices since the end of the Korean War. The Commission's recommendation, based on the escape clause of the Trade Agreements Extension Act (see no. 914), was to increase duties on lead and zinc by 1.5 cents and 1.4 cents per pound respectively (State, Foreign Relations, 1952-1954, vol. I, General: Economic and Political Matters, pt. 1, p. 201). On June 7 Dulles had urged Eisenhower to reject the Commission's decision. Not only would an increase not solve the problem, he said, but such a rise would, in fact, severely damage U.S. relations with the eleven zinc and lead producing countries in the world. "Serious repercussions" would result particularly in Latin America, Dulles argued, where every government is concentrating on the import policies of the United States. Increased tariffs were not necessary, he said, since Eisenhower had recently approved a recommendation of the Minerals Policy Committee to expand stockpiles of these minerals (Dulles to Eisenhower, June 7, 1954, WHCF/CF: Trade Agreements and Tariffs--Lead and Zinc; see also Legislative Leadership meeting, Mar. 22, 1954, AWF/D; Dulles to Eisenhower, June 29, 1954, AWF/D-H; and Dulles to Eisenhower, Aug. 17, 1954, WHCF/CF: Trade Agreements and Tariffs--Lead and Zinc; for background see State, Foreign Relations, 1952-1954, vol. I, General: Economic and Political Matters, pt. 2, pp. 1116, 1145-47, 1257-58; and Alfred E. Eckes, Jr., The United States and the Global Struggle for Minerals [Austin, 1979], pp. 210-13). On July 1 Eisenhower had discussed with Dulles the efforts being made to avoid hurting "our friends" in the lead and zinc issue (Telephone conversation, AWF/D). He asked the Secretary to tell the five or six countries that were principal suppliers to "take voluntary action in lowering the export rate to us. . . . If they don't," Eisenhower said, "we will be forced to let our price down here, which would result in [a] bad market all over the world." Dulles had reiterated his position on July 12. "I realize that this is from a domestic political standpoint a `nettle.' I feel however that I should let you know that from the standpoint of hemispheric relations, Canada, Mexico, and several South American countries, this subject is of transcendent importance and that to increase the duty would be interpreted as an unwillingness to trade, which I fear would have grave consequences in terms of the hemispheric solidarity which is becoming increasingly important to us" (Dulles to Eisenhower, AWF/D-H; see also Eckes, The United States and the Global Struggle for Minerals, p. 213, and Kaufman, Trade and Aid, pp. 38-39). In his conversation with Dulles on this day Eisenhower had asked the Secretary to present his views fully to the other Cabinet members of the Minerals Policy Committee (Memorandum, Aug. 12, 1954, AWF/D-H). Dulles would report that the members of the committee had agreed, "with a dissent from George Humphrey for the record," that accelerated stockpile buying of these minerals was preferable to increased duties or subsidies (Dulles to Eisenhower, Aug. 12, 1954, ibid.; see also Flemming to Eisenhower, Aug. 17, 1954, WHCF/CF: Trade Agreements and Tariffs--Lead and Zinc). The State Department would, Dulles added, "point out to other countries the effort we are making and ask their cooperation in avoiding a stimulation of exports which would nullify our stockpile effort." 2 Utah Senator Arthur Watkins, who was a member of the Senate Judiciary Committee, had written Eisenhower concerning the hardships faced by the lead and zinc producing states (Aug. 6, 1954, AWF/D-H). He described the "human factors" that free-trade advocates do not have to confront directly. "Perhaps," he wrote, "if your trade advisors had to personally tell these 1500 families in Utah, and countless more in other areas, that their means of livelihood had been sacrificed to foreign miners, working at peon's wages, they would obtain a little different picture of this problem." 3 Watkins's concern for the mining communities was "one side of the picture," Dulles would acknowledge. "Another side," he said, "is that there are in this country smelters and smelting towns which depend upon imported ore which would close down if imports were blocked out and the misery in these towns would replace the misery in Watkins' towns. There is, I fear, no painless solution" (Dulles to Eisenhower, Aug. 13, 1954, ibid.). "We are moving immediately ahead in talks with the Ambassadors of the principal foreign suppliers," Dulles added, "in the hope that they will take voluntary action which, coupled with increased stockpile buying will steady and improve the market." 4 Eisenhower had responded to Watkins on August 11, assuring the Senator that his recommendations would receive "the most careful consideration" (AWF/D-H). On August 20, citing the "adverse consequences that would follow for our international relations," Eisenhower would reject the Tariff Commission's recommendation for higher lead and zinc duties and call for an expanded stockpile of those metals (U.S. Department of State Bulletin 31, no. 793 [September 6, 1954], 339). ODM Director Flemming would report to Eisenhower on September 22 that both the domestic and world market prices of lead and zinc had shown a "healthy increase" since the announcement (WHCF/CF: Trade Agreements and Tariffs--Lead and Zinc). Bibliographic reference to this document: Eisenhower, Dwight D. Confidential To John Foster Dulles, 12 August 1954. In The Papers of Dwight David Eisenhower, ed. L. Galambos and D. van Ee, doc. 1019. World Wide Web facsimile by The Dwight D. Eisenhower Memorial Commission of the print edition; Baltimore, MD: The Johns Hopkins University Press, 1996, http://www.eisenhowermemorial.org/presidential-papers/first-term/documents/1019.cfm <--PREV Doc #1018  |  Memorial Commission Home Page  |  First Term Table of Contents  |  Presidential Papers Home Page  |  Doc#  |  NEXT--> Doc #1020

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