Reciprocal trade agreements negotiated by the United States with State Department memorandum setting forth the authority other than Summary of import license and exchange control regulations in prin- Vandenberg, Hon. A. H., a United States Senator from the State of Page 585 617 351 177 51 294 1 FOOD AND AGRICULTURE ORGANIZATION Created Oct. 1945 by Specialized Agencies to be brought into relationship with United Nations. INTERNATIONAL TRADE ORGANIZATION To be created as a INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT Created Dec. 1945 with present membership of 38 countries and subscribed capital of $7.7 billion. Purpose to make or guarantee long term loans for reconstruction or development of resources of member countries. INTERNATIONAL TRADE ORGANIZATION THURSDAY, MARCH 20, 1947 UNITED STATES SENATE, The committee met at 2:30 p. m., pursuant to notice, in room 310 of the Senate Office Building, Hon. Eugene D. Millikin (chairman) presiding. Present: Senators Millikin (chairman), Bushfield, Hawkes, George, Connally, Johnson, and Lucas. The CHAIRMAN. The hearing will please come to order. The purpose of this hearing is to inquire into the relationship of the trade agreements system and the proposed International Trade Organization Charter. Congress is already in possession of considerable information as to the trade agreements system, but there seems to be very little information as to the proposed International Trade Organization. Therefore, the emphasis will probably be in the main on the International Trade Organization, although obviously the object of our inquiry requires examination into both. I should like to say that we have a letter from Senator Vandenberg, chairman of the Foreign Relations Committee, dated March 12, 1947, which I shall read for the record. The letter is addressed to me as chairman of this committee [reading]: MY DEAR SENATOR MILLIKIN: You have discussed with me from time to time your belief that the proposed Charter of the ITO (the proposed International Trade Organization) should be carefully reviewed ahead of the Geneva Conference so that the State Department may have the advance benefit of congressional suggestions regarding this vitally important matter. I am in complete agreement with you that it is highly advisable to pursue this course. It is a subject which falls particularly within the interest of the Senate Finance Committee. I sincerely hope you will pursue your purpose to have the whole subject matter carefully reviewed at once by your committee. As chairman of the Foreign Relations Committee (which will have primary jurisdiction when the ITO agreements are completed), I would greatly welcome the advance advice of the Senate Finance Committee; and it should be advantageous to the State Department to know your committee's considered view in advance of the negotiations. With warm personal regards and best wishes. Cordially and faithfully, Our first witness will be Secretary Clayton. A. H. VANDENBERG. Mr. Secretary, I assume that you wish to discuss the subject generally, and that later on when you have finished we will discuss the details of the proposed International Trade Organization Charter with Mr. Wilcox. 1 STATEMENT OF WILLIAM L. CLAYTON, UNDER SECRETARY OF STATE FOR ECONOMIC AFFAIRS Mr. CLAYTON. Yes, sir; I would like to do that, Mr. Chairman. Mr. Chairman and members of the committee, I have a short prepared statement which I would like to read for the record, and following that I would be glad to try to answer any questions that might be asked me about this subject. The CHAIRMAN. I should say that this whole hearing has been called on short notice, with the idea of getting ahead with the busi ness for the purposes stated in Senator Vandenberg's letter, and that will account perhaps for the Secretary's failure to have copies of his remarks and will perhaps account for other materials which will be missing for a few days. Mr. CLAYTON. The machinery for international economic cooperation has not yet been completed. The International Bank for Reconstruction and Development and the International Monetary Fund which were created at Bretton Woods are ready for business. But the third and perhaps most essential part of the machinery for economic cooperation is the International Trade Organization which is now being created. The broad purpose of the International Trade Organization is to aid in expanding the volume of international trade which is so essential to the prosperity of this country and other countries. The achievement of this purpose is essential to the successful operation of the Bretton Woods agreements, a fact that was specifically recognized by Congress in the act approving these agreements. Without the Trade Organization, a vital part of the machinery for economic cooperation would be missing. The charter for an International Trade Organization was formulated by the Preparatory Committee for a World Conference on Trade and Employment, this Committee having been established by the Economic and Social Council of the United Nations. The present draft is the product of the first meeting of the Preparatory Committee held in London in October and November of last year. The Government officials who met at London were experts designated to formulate a draft for consideration by their respective governments and peoples. Neither this Government nor any other government is committed to the draft as it now stands. The draft charter formulated at London has been widely studied by interested organizations and persons throughout this country. We recently completed hearings in seven cities in order to get the criticisms, suggestions, and views of those who have studied the draft. We have found that the need for an International Trade Organization is widely recognized and approved. We have received a large number of constructive and useful criticisms which we are now studying. The Congress must eventually determine what part the United States is to play in this critically important field of economic cooperation, and what commitments the United States Government should undertake to this end. I am therefore very glad that the Committee has afforded an opportunity for consultation at this formative stage. |