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United States Department of State / Foreign relations of the United States diplomatic papers, 1937. The British Commonwealth, Europe, Near East and Africa

United Kingdom ,   pp. 1-135 PDF (51.1 MB)

Page 45

between Great Britain and the United States. In spite of this the
Canadians took the position at the Imperial Conference that they
would need compensation from us if they are to give the British what
they need. Nevertheless Brown thought that something could be
done on apples. He said lumber is more difficult both because of
Canada and of the Scandinavian countries repeating the arguments
they have already given us.
  5. As regards Australia, Brown said that their principal preoccupa-
tion at the present time is to keep Lyons from committing himself
irrevocably on the subject of preferences. A statement is now being
worked out at the Board of Trade which Lyons might make in the
election campaign and which would still make it possible to do some-
thing in the event of his victory at the polls.
  6. In view of all this I asked Brown why at the beginning of our
conversation he was not more optimistic. He replied that it was partly
the result of his general feeling, the frank discussion of which with
me he thought was- very helpful, and partly because he was frightfully
tired after weeks of bickering with the Dominion representatives.
He then added "never mind all that. Please believe me that we are
trying and will continue to try our best." He asked me to be sure to
get in touch with him when I return to London in September on my
way home. He wants to have another discussion in the light of what
might transpire in the meantime.
  7. My general impression, more perhaps from what was hinted
than said, is that while the British are extremely anxious to have an
agreement they are going to make another attempt to get us to bargain
directly with the Dominions. I think we ought to maintain our posi-
tion in this respect. I doubt that we can get our whole must list and
will have to recede substantially, especially on dried and canned
fruits. But I doubt equally that we can get much more by paying the
Dominions directly. I think we can get the removal of preference
on wheat. I did not discuss the matter with Brown but I gather
from conversations with an Australian and a Canadian friend that
there is not likely to be great opposition in their countries. The fact
that we did not ask for wheat originally should make it relatively
easy for us to indicate it as compensation for some recession. I think
we ought to stick to our tobacco request. I understand that the Treas-
ury is questioning the idea of increasing revenue from tobacco by
increasing the duty on Empire tobacco and thus narrowing the margin
of preferences against us. There is going to be a great deal of bicker-
ing on individual commodities but I think the chances for an agree-
ment are very good. The atmosphere in London is extremely
favorable in this sense and the Government is likely to come in for a
good deal of unpleasant criticisms if they have to admit failure.

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