CONTIDENTIAL
4.
We deployed the arguments in Washington telegram No. 297, emphasising particularly that, despite Mr. Hixon's fair words, the world would be likely to take his action on textiles (where the domestic industry's difficulties appeared to be more political than real) as indicative of his general position. Ellsworth said that considerations such as those which we had advanced would be taken fully into account. He would not take us up on our contention that the problem was primarily political in character, but we should not take his silence as implying assent. We (and by inference the representatives of other textile exporting countries) could expect to hear from him fairly soon.
5.
We also had a brief discussion on protectionism generally. Ellsworth suggested that other protectionist lobbies would not get very for if the textile industry were neutralised. When I said that the voluntary agreement on steel had not so far led to any visible relaxation of pressure for steel quotas, State Buy Americanism or countervailing duties he implied that this should perhaps not be taken at its face value.
In the upshot we are still left guessing.
Ellsworth's
6. general assertion of President Nixon's liberal trade philosophy carries some reassurance. On the other hand it looks very much as if the textile exporting countries will be approached fairly soon about the possibility of restraining textile exports; it seems possible, from questions that Hoffman asked about U.K. difficulties with low-cost imports, that an attempt may be made to gang up with other developed countries. In the light of Mr. Nixon's campaign assurances (in public he said he would "promptly take the steps necessary to extend the concept of international trade agreements to all other textile articles involving wool, man-made fibers and blends", and there is some reason to think that he was more explicit in private) it would be difficult for him to do less. fr. Mills's speech (Washington telegram No. 249) also leaves him little option. What is much less certain is whether the Administration would press such approaches to the limit for positive results (and” in default would opt for quotas), or would be content in the last resort to say that they had done their best. For the time being it seems obvious that the posture of the U.K. and other exporting countries should continue to be one of giving the Americans no encouragement whatever to expect results and to play things as long as possible.
7。
As an immediate step it would seem desirable for the main exporting countries to lose no time in bringing home to the new Administration that they could not expect a proposal for negotiations to meet with an easy response.
President Nixon's proposed visits to London and other European capitals would provide the best possible opportunity for doing so. It would gain time, and possibly strengthen the impact, if we notified the Americans without delay that we intended to raise the subject during the visit.
-2- CONFIDENTIAL
P. W. Ridley
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