"Mr. Welles will serve as chairman and Mr. Hugh Wilson 19 as vice chairman of this committee." 20

The full membership of the Committee finally included, beside the members already named, James C. Dunn, Political Adviser, and Breckinridge Long, Assistant Secretary, Norman H. Davis, former chief delegate to the disarmament conferences in London and Geneva, and George Rublee, then director of the Intergovernmental Committee on Political Refugees. Consequently the Advisory Committee was not only departmental in authorization and in function but was almost entirely departmental in its membership of fifteen.

21

Its three subcommittees were composed wholly of members of the Committee. George Rublee was chairman of the Subcommittee on Political Problems, the remaining members of which were Messrs. Welles, Berle, Long, Hornbeck, and Hackworth, with the other chairmen also attending its meetings. The Subcommittee on Limitation and Reduction of Armaments was composed of Judge Moore, chairman, and Messrs. Messersmith, Davis, Dunn, and Moffat. The members of the Subcommittee on Economic Problems were Messrs. Pasvolsky, chairman, Berle, Grady, and Feis. Mr. Wilson, as vice chairman of the Advisory Committee, also performed such executivesecretary duties as were required.

Composed of high-ranking officers who were carrying fatiguing burdens of detail as well as of major responsibility in a small Department, dealing with the intricate problems of neutrality and the grave complexities of deteriorating international relations, meeting without agenda or minutes or preparatory studies in the absence of a qualified staff, and subject to hourly interruptions to meet needs for current action, two of the Subcommittees were yet able for a short period, lasting into the spring, to meet with some frequency and to make a degree of progress. Any papers presented were of necessity individual views hurriedly written-sometimes improvised-by one or another member, and not always circulated before meetings. When discussion had developed a general consensus on a matter for early action, a recommendation would be prepared. For the most part, however, the work was exploratory. The Subcommittee on Limitation and Reduction of Armaments met once, but thereafter did not function separately from the Subcommittee on Political Problems. Under the prevailing circumstances, the Committee itself became primarily an instrument of current policy and, with most of its members active in the two main Subcommittees, met only infrequently. Review of agreed subcommittee views was accomplished through the regular Departmental channels to the Secretary rather than through the Committee as such.

" At that time Special Assistant to the Secretary of State.

20 Department of State Bulletin, II, 19.

21 Owing to Mr. Rublee's illness, from the beginning of work Mr. Welles served as Chairman.

O

CHAPTER II

Program of Preparation, 1940

RGANIZED preparation for the postwar period began against the background of the President's address to the Congress, January 3, 1940, in which he stated that "we can strive with other nations to encourage the kind of peace that will lighten the troubles of the world. The President emphasized on this occasion "the leadership which this Nation can take when the time comes for a renewal of world peace," and expressed the hope that all Americans "will work out for themselves the several alternatives which lie before world civilization.

." In preparation for this Nation's role in the re-establishment of peace as envisaged by the President, the main purposes of policy consideration by the Advisory Committee on Problems of Foreign Relations were, accordingly, to limit and to end the war if possible, to clarify the requisite bases for a future peaceful world order, and, more immediately, to strengthen the defense of the Western Hemisphere. These purposes were interwoven.

SUBCOMMITTEE WORK AND DIPLOMATIC SOUNDINGS

THE SUBCOMMITTEE on Economic Problems was the first to organize. On January 3 it set out to prepare for possible American participation in some early conference at which economic problems would be dealt with and in the reconstruction efforts that might possibly follow. It was thought that the common interests of nations were more generally recognized in the economic than in the political field. The experiences of the interwar period had focused attention on the effects of economic policies on international relations-both directly as an important source of friction between nations and indirectly as a basic factor contributing to stability or instability within states. Extensive consideration had been given by this Government in the thirties to these effects, so that by 1940 the general goals of our economic policy could be more clearly defined than could our objectives in the political and territorial fields. This Government had already taken steps toward these goals

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through the Trade Agreements Act and through the various economic policies and arrangements agreed upon with the twenty other American republics. Many of those taking part in the Department's early preparatory work thought that public opinion in this country would go further in support of United States participation in international economic cooperation than in international political arrangements, which the national interest in peace seemed increasingly to require, and that the way might best be paved for the latter through the former. In the light of these considerations it was decided to approach the V problem of the restoration of peace first from the economic standpoint.

The Subcommittee on Economic Problems considered on January 3, 1940, a program of work covering the five principal fields of commercial policy and relations, monetary policy and relations, credit and investment relations, production trends, and price trends.2 The program projected the analysis and appraisal both of interwar economic experience and of current developments affecting the postwar situation, preparatory to an effort to solve the broad problems of postwar economic policy. The lull in the European war, however, appeared to offer an opportunity for the immediate initiation of action, and within two weeks this general program had developed into a more specific proposal of January 15 outlining the bases for an economic settlement, which might serve as a basis for discussion at a conference of neutrals or at a more general economic conference, or at both.3

This proposal was discussed immediately by the Subcommittee on Economic Problems and the Subcommittee on Political Problems in terms of a possible conference of neutrals. By January 18 thought was clarifying on the scope of such a conference, which, it was considered, might include economic questions arising from the war, postwar economic desiderata, and cooperation in formulating other foundations for future peace. Further consideration was to eliminate current problems from the scope of the proposed conference, and to limit its terms of reference to postwar economic cooperation and the armaments problem. Papers on suggested procedure, proposed agenda, and the basic questions to be considered in the "formulation of a post-war economic program" were prepared by members of the Economic and Political Subcommittees, and the Political Subcommittee formulated on February 2, 1940, a set of considerations that should be discussed before conversations with the neutrals were initiated.

} At the same time that the Subcommittee on Political Problems was occupying itself with the political aspects of the proposed conference of neutrals, first thoughts on the future organization of world order were presented to it by several members. It was appreciated that the problematical course of the war, the many unknown circumstances 'See appendix 2.

See appendix 3.

ahead, United States neutrality, and the uncertainty of public opinion regarding international political cooperation rendered any such views essentially conditional. Therefore the views presented contained many queries or suggested varying possibilities. Should the United States, apart from cooperation with Europe in matters of economic reconstruction, commit itself to any international cooperation on purely political matters? Perhaps in view of the failure of the League of Nations and the success of the inter-American system, a number of regional leagues-each under an individual, rather than a representative of a government, as president and each having a direct relationship to the others should be favored. Still another possibility was that the League of Nations might be continued, with modifications, to represent primarily the states of Europe and Africa; a regional group might be formed for Asia; and a collaborating relationship established between these regional arrangements and the inter-American organization. The subcommittee did not, however, reach the point of discussing this subject concretely until several months later.

During this same period memoranda on limitation of armaments and on possible United States mediation in the European war were also drafted for consideration by the subcommittee.

The subcommittee's preparations for the proposed conference of neutrals had progressed so far that Secretary Hull on February 8-10 initiated diplomatic conversations with the governments of fortyseven neutral states. It was envisaged that if feasible the conversations could later be extended to nations engaged in declared or undeclared hostilities. The Secretary proposed on behalf of the President that views should be exchanged concerning "two basic problems" in establishing lasting world peace on a sound foundation: the bases for a sound international economic system and armament limitation and reduction. These exchanges would not involve any of the "present problems" arising in connection with the existing war situation. The intent was to obtain before any peace conference was held a definite understanding and, so far as practicable, commitments with respect to the basic principles of sound and stable international relationships after the war. The only hope of constructive accomplishment, either at the peace conference when held or during the reconstruction period, appeared to lie in such firm prior acceptance of sound policies by as many nations as possible.

'The forty-seven neutrals were the 20 other American republics and Belgium, Bulgaria, Luxembourg, Egypt, Saudi Arabia, Afghanistan, Denmark, Greece, Hungary, Iran, Iraq, Ireland, Italy, Estonia, Latvia, Liberia, Lithuania, Netherlands, Norway, Portugal, Rumania, Siam, Spain, Sweden, Switzerland, Turkey, and Yugoslavia.

Replies were favorable without important exceptions, although some were merely sympathetic and some were skeptical of positive accomplishment. Thirty of the forty-three replies received by May 23 explicitly or implicitly showed readiness to give full cooperation. The attitude of others was reserved, particularly as to disarmament, or conditional on specific proposals. One preferred the use of usual diplomatic channels to a conference. Many expressed the desire to see the ideas of the United States set forth as a basis for discussion.

Preparations for the proposed conference were pressed vigorously by the Subcommittees on Economic and Political Problems, taking form particularly in an inclusive memorandum presenting the views of this Government on postwar economic relations and disarmament. Aside from the specific program formulated, which was built on the basic economic policies consistently pressed by Secretary Hull throughout the preceding critical years, this memorandum stressed the necessity for parallel action in the interdependent fields of economic reconstruction, international political stability, and disarmament.

The development of the economic program for the conference of neutrals naturally involved matters of direct interest to other Departments, especially Treasury, Commerce, and Agriculture, and to the Tariff Commission and the Export-Import Bank. The evident scope of the specific implementation that would be required under the broad policies enunciated in the program, and of the conference itself when ✓ held, seemed to require organized interdepartmental consultation. A plan for such consultation was prepared February 29, 1940, by the Chairman of the Subcommittee on Economic Problems after discussion with Secretary Hull. It projected a special "Interdepartmental Advisory Committee on Economic Consultations with Neutrals" to work in conjunction with the Executive Committee on Commercial Policy and the Committee on Trade Agreements, which were standing interdepartmental committees. Subcommittees would study individual problems, and technical experts in the various Departments and agencies would prepare materials. Secretary Hull began to confer in March with the Cabinet members concerned. Shortly afterward, however, all these plans were dropped. Although the preparatory papers for the conference of neutrals were completed during April, termination of the lull in the war rendered further action impracticable.

Concurrently with the move for a conference of neutrals, it had been announced by the President on February 9, 1940, that Mr. Welles would undertake conversations with the Governments of the principal belligerents in Europe (Germany, France, Great Britain) and of Italy. The purpose of these conversations was to obtain in Б See appendix 4.