Briefing for Washington

On the eve of the Washington talks, the bullyragging and the bitter recriminations that had passed between the U.S. and Britain faded into an abashed mumble-grumble. On both sides of the Atlantic, hot words cooled off under the growing realization that the British crisis was a crisis for the whole Western world.

The British press, as if a little ashamed of its earlier behavior, paused to recall how much the U.S. had already done for Britain; the U.S. press reminded itself of the harsh fact that, if Britain went down in economic distress, dragging the great sterling bloc of nations with her, the U.S. economy would be sorely shaken, the free world's defenses critically weakened. Dean Acheson in Washington and Ernest Bevin in London argued that the need to maintain U.S.-British unity must influence economic decisions.

In this chastened mood, U.S. and British leaders gathered for the momentous conference which opens in Washington next week.

The Practical Approach. Last week an advance guard of experts was already at work in Washington, examining a preliminary statement of Britain's situation furnished by London. Sir Stafford Cripps, who will be the British delegation chairman, secluded himself in his Gloucestershire home, jotted down neat notes (appropriately in red ink) from a pile of Treasury briefs that mounted during the week from 20 to 42. He was reported, among other things, to be weighing the chances and consequences of a further slash in U.S. imports to slow the alarmingly rapid drain of his country's dollar reserves.

This week, after a cabinet session which approved a final statement of British policy at the conference, Cripps and Bevin headed for Washington. En route, aboard the Mauretania, they would whip their arguments into final shape.

Until Cripps and Bevin arrived, Washington could not be sure of the British position. But it was known that the British were veering toward a practical, circumspect approach. They were inclined to ask for only a little now in the way of special help from the U.S., in the hope of more later. Specifically, they would probably propose a larger British slice of the ECA pie for Europe, which OEEC is currently fighting over (see below); a freer hand in spending their ECA allotment; a cut in U.S. tariff duties on British goods, an easing of U.S. customs red tape, and permission to save dollars by discriminating more freely against certain imports from the U.S. (i.e., buying goods, instead, from America's competitors if they can furnish them more cheaply). Sir Stafford Cripps was still reported stubbornly opposed to devaluation of the pound, but there was growing feeling in Britain that devaluation, while a severe and only incomplete measure, might be a good thing in the long run.

The Three Hearts. The U.S. position was summed up by a waggish Washington newsman as having three hearts--the hard heart, represented by Treasury

Secretary John Snyder; the bleeding heart, carried by State's Dean Acheson; and the beating heart, displayed by ECA Administrator Paul Hoffman.

In top level briefings, on four successive afternoons in a State Department conference room, Acheson and Snyder listened to their experts lecture on the British crisis and all its implications.

State stressed the global problems involved, advised a gentle approach, with all regard for British sensibilities. Treasury was less sympathetic; the British could do more for themselves than they are doing, argued Snyder's men, and besides, State had a reputation as a soft touch.

ECA Chief Paul Hoffman, who will take part in the conference, struck a balance between Snyder and Acheson.

Last week, in the arc-lighted ballroom of London's Claridge's Hotel, before a tough audience of some 200 newshawks and cameramen, the trim, grey-suited American told Britons some harsh truths -- with a chaser of enthusiasm and hope.

The Challenge. Hoffman first deftly disposed of some stock British alibis and delusions. For one thing, he said in answer to newsmen's needling questions, the U.S. does not have to sell goods to Britain or to anyone else in Europe to stay prosperous. For another, he admitted that U.S. tariff policies could stand improvement ("too many [Americans] believe that imports harm rather than enrich their country"), but he pointed out that, within existing U.S. tariff barriers, British exporters still had ample opportunities. The trouble was that the British had not tried hard enough to exploit them. He put an accurate finger on one reason for British woes: British business had preferred to sell its wares to nondollar markets, where demand was high and Britain met only soft competition.

Like a sales manager giving a quiet pep talk, he urged British industry to go out and grab a larger slice of the dollar market. He proposed two "practical, realizable goals"-- a fivefold increase in the number of British firms engaged in exporting to the U.S.; and a threefold increase of British exports to the dollar market (from $600 million to $1.8 billion).

Hoffman pointed out that in 1948 the U.S. had a gross national product of $254 billion. "Just three-tenths of 1% more of that spent on British goods,"he said, "and the dollar gap can be closed . . . First, study carefully what the Americans want. Then make it at prices they are able and willing to pay, and package it to appeal to the American consumer. That is the way to earn dollars...This will take energetic salesmanship as well as cheap production. It is the challenge confronting the business statesmanship of Britain."

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