CONFIDENTIAL
would prefer multilaterial textile restraints, or bilateral
greements with individual Asian countries; the attitudo of sono European Goverments ond of the CAÎT Secretariat had led sune" people to argue that bil toral agreements would be more acceptable. I said that to the U.K. textile restraints in any form wold be unwelcome, and that we had not taken a view on the hypothetical choice which Mr. Borgston had raised.
5.
I asked what would happen if foreign countrise continued to feel that the wider implications of agrecing to tortile restraints were too damaging, and maintained their resistance to U.8. proposels, Would the U.S. really teke unilateral action and face up to the possible violation of GATE? Dr. Bergston questioned me closely about the options available to the United States under Articles XIX and XIV; He also expressed interest in the possibility of compensation by the United States (assuming that Congress gave statutory powers) for quantitative restrictions on textilos. In the last analysis the question was: would į Mr. Mills lot textile quota logislation through, and if he did would the Fresident uco his veto? Mr. Borgston was sure that Ir. Nizon and Mr. Mills would hope nevoz to be faced with such decisions, but he agreed that neither would wish to put the United States in breach of GALT obligations if this could be avoided. The decision, if it arose, would however tu very much on wider political considerations at the time.
5.
The decision on whether to send up trade legislation (covering A.S.P., limited tariff modification powers, adjustment assistance and escape clause action) would not Do taken until after Iv. Stéño' Asian vicit, It was in any cuse very uncertain at the moment how soon the Ways and Means Committee would be clear of tax and budget probleng and would have time to deal with it. The prospecte for legislation must be affected by the Administration's cuccess or failure in getting textile restraints, but it was possible that the textile lobby, and its political bockers, could bo bought off by other means, including perhaps some limited arrangements to deal with the sectors of genuine difficulty from textile imports. Mr. Dergeton caphasised that the Administration were thinking towards trade proposals in the longer run going well beyond the limited logislative packeg0 in immediate prospect; thero wore "exciting possibilits! The longer term prospects also depended to some extent on dealing with the textile problem, just as the cotton L.T.A. had got the Kennedy Round legislation off the ground in 1961,
77.
I had the impression that I, Borgaton welcomed one tolk, and that in particular he was getting fron 16 some ideas and arguments for use in the National Security Council tomorrow.
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P. 7. Ridley 6 May, 1969
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