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G.P. 323
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action (or indeed pr.vent it): this would have to be done through the legislative branch.
29.
Mr. Katz then took up a point made earlier by Sir John on the virus of infection leading to restrictive action in other fields. He pointed out that had it not been for Wilbur Mills, the Hollings bill would have been passed, and other protectionist legislation (for example, in the electronics field and footwear) would have got through as well. The textiles issue was critical in the dynamics of Congress. The textiles lobby commanded enough votes to carry a restrictive bill through. But if the need for legislation in the textiles field could be avoided, then other restrictive legislation would not get through. Sir John pointed out that these could only be assurances, not guarantees. Mr. Stans said he held commitments from key congressmen that they would oppose other restrictionist legislation if the textiles problem was solved and these were reinforced by the President's own commitment to freer trade. Sir John
enquired whether President Nixon could not exercise his powers of veto to prevent any restrictionist legislation being passed by Congress. Mr. Stans replied that the textile lobby commanded a sufficient number of votes to provide the necessary two-third majority to override a veto.
30.
Sir John explained that by the virus of infection of protectionism spreading he had meant that it would spread to other countries, not within the United States. He went on to enquire what sort of reaction Mr. Stans had received from the other countries he had visited.
31.
Mr. Stans replied that concern and sympathy for the American position had been generally expressed, although they had not been received with open arms.
In three cases, Government representatives had indicated a willingness to help and support the American stand. He could not, however, reveal which the three countries were.
32.
Mr. Stans went on to say that his visits were only preliminary to state the facts, and that the dialogue would be continued through diplomatic channels. His appeal to Hong Kong was not to let the situation get to the point where import restrictions would have to be imposed. The problem faced by the United States was as much social and political as an economic one. The political mind did not always work by logical reasoning.
33.
situation:
tion
Mr. Blackman said there were two factors in the
(a) The legislative factor:
an amendment to
the Fair Labour Standards Act designed to limit imports of goods produced under sub- standard working conditions had only just been held back, but it was primarily aimed at the lower-wago countries in Asia; this type of legislation was being introduced into Congress continually.
CONFIDENTIAL