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Notice Numbers appearing in square brackets (ex. [45]) within the transcript indicate the pagination in the original, hardcopy version of the oral history interview. RESTRICTIONS Opened September, 1981 [Top of the Page | Notices and Restrictions | Interview Transcript | List of Subjects Discussed]
Oral History Interview with
July 6, 1970 By Theodore A. Wilson
WILSON: You've had an extremely interesting career from the historian's point of view in particular, because you've been in so many areas that apply, or have application, to the subject. I might just ask generally how you might sum up that period. MARTIN: Well, as I've thought back on it, one of the things that I have come to believe, that I haven't seen mentioned elsewhere, is that in many ways the occupied area experience, which was my first in the State Department, was a rather unique and interesting prelude to foreign assistance.
In effect, we were trying to restore shattered economies, within certain political limits, but still we wanted to stop having to feed them. So we were trying to put them back on their feet economically, and we were trying to make them accept changes which we thought were more in accord with a modern democratic society. In some cases I think that this was successful; in other cases it's a little hard to see so much evidence. However, as of now, a short time historically, both Germany and Japan are different countries in many ways from what they were before the defeat and occupation. Certainly in Japan the agrarian reform, for example, has been a major factor in Japan's future development. I think some of the other measures in the fields of education and corporate split-up, called the Zaibatsu program, have had an impact. So that I think anybody wanting to write a history of foreign-aid experience of the United States really has to start with some of the things that were learned in that period, by people who were later involved in the aid business.
WILSON: That's very interesting, yes. MARTIN: I first got involved in July 1947, when I had been about two years working in charge of Japanese and Korean economic policy. I had started work on occupation policy at OSS under Ed Mason who then went to State and then left. At that time I had never been outside the United States which was characteristic of too much of the U.S. foreign policy of the period. I had a couple trips planned in OSS but none of them materialized. Charlie [Charles P.] Kindleberger, who had been head of German and Austrian economic affairs, was taken over in the summer of 1947 to work on the planning of the Marshall plan. So I was given Germany and Austria as well, and these countries were related to the Marshall plan programs so that I got in on the planning. My first participation was a series of meetings, of which you perhaps have heard, which were held in July and August of '47, under the chairmanship of Willard Thorp, at that time Assistant Secretary for Economic Affairs. As I recall it, we met on
Tuesday and Thursday evenings from 7:30 to 9:30. There were about 15 to 20 people from the State Department and from the Department of the Treasury, and one or two other agencies. Secretary Marshall had made a speech; the question was, what do we do about it? And that was our problem -- how do we carry out the intent that was announced? It was a very hot summer as I recall. We spent our evenings on this; that was the only opportunity for uninterrupted discussion of fundamental questions. We were all groping as to what was to be the reality behind it, and... WILSON: Did you have much information while these meetings were going on about what was going on here? With the OEEC? MARTIN: Well, not much was going on yet here. We were, of course, informed, but not much was going on because nothing had been established here. One of the problems was what do you establish in Europe. WILSON: Yes, that's right. Well, in September then they...
MARTIN: That's right, because this was July-August. I guess it may have run a bit into September. Toward the end of August I went to London for tripartite talks on the level of German coal and steel industries. Ambassador [Lewis W.] Douglas was the U.S. representative and I was sent from the Sate Department as his State Department advisor. At the end of those talks he went over to Paris to meet with Will Clayton, who was there at the time, having talks about what to set up. I had a rather amusing experience in that on the morning that he was to come back, he called me on the phone, and said, "My plane is coming over to pick you up this afternoon. I want you to come over so that you can sit in on a talk we're having with Clayton and a couple other people here and get the feel for how things are developing and you'll have this to take back to Washington; then about dinner time we'll both fly back to London." So, I went, flew straight from the Embassy. In the course of the afternoon a major problem developed with Mr.
Pesche, who was Minister of Finance, on how to go ahead with this. And we were there three days, very hot days, with no fresh shirts, not a toothbrush, because I had come with the expectation I would be back that afternoon. But they were in the midst then of threshing out how to proceed with this whole program and what the European counterpart should be. I would say that that's the only distinct recollection I have of that part of the operation at that stage. Subsequently, I was pretty heavily involved with the Council of Foreign Ministers meeting in December, to which I came, and which broke up on reparations, which was one of my issues, so to speak. Then I was over for six weeks at the six-power talks, which set up the Ruhr Authority in February and early March. And after those, I made a brief visit to Austria and Germany, the first time I was ever there. Then in the spring of '48, I took another job as deputy director of the Office of International Trade Policy, which Paul Nitze had just left to become
Deputy Assistant Secretary of Economic Affairs, and my jobs there were primarily security-related in a sense. The boss was Win [Winthrop] Brown who handled trade, the ITO negotiations, GATT and all of those matters. He was an expert; I knew nothing about them and didn't want to. The major European interest was in East-West trade policy. I had participated as the chairman of an internal state working party the year before, in the first formulation of the U.S. position on this. I came over to Europe that fall – 1948 -- to set up COCOM -- the Coordinating Committee here, in talks with the various countries. Also I got involved in another aspect. I don't know how much you're interested in this, but I was seconded from the E area to help with the development of the Military Assistance Program, which started, as I recall, in the fall of '48. So I was half-time assistant director, or something, of the military assistance operations, supposedly to advise on economic aspects. They were shorthanded and we all worked together. I guess Ernie [Ernest] Gross
was the first head, and then Walt [Walter] Surrey served. Walt had worked for me back in 1947 on enemy assets problems. So I was heavily involved in that and drafted the cable that went out to the Europeans CWEU) saying this is the way to ask us, and this is the time schedule, so we can present it to the Congress. I remember the hot Saturday afternoon going over to Fort McNair to get [Major General L.L.] Lemnitzer’s clearance on the final text of that cable. That was a very interesting experience, with some very able people from the Pentagon; Tick [Colonel C.H.] Bonesteel, who is now a commander in Korea, was sort of my opposite number under Lemnitzer. WILSON: He served here under Harriman, or with Harriman. MARTIN: Yes, that's right. He's been on a NATO group that I got involved with later. There again we were developing from scratch. There were some who had Turkey experience on military assistance but it wasn't really too relevant to the broader European operation. It involved us in the problem of how we can go about
this, and how we can get the Europeans to ask us in a way which will permit us to respond with proper congressional support. I don't remember any Truman aspects of this, or Presidential aspects, at all. There was one little human interest angle that I thought was amusing. When they set up the office, they didn't want it to look all military. There was a small group in the Office of European Affairs that had been following Marshall plan matters for the State Department. Its head was Harry [Henry] Labouisse, as I remember. They were sort of merged in, and it was called the Coordinator of Foreign Assistance. It was put under the Under Secretary. In accordance with the State Department procedure, that meant that its initials were U/CFA. A little later somebody pronounced it who knew pig Latin. As soon as Ernie Gross left, they changed it to place it under the Secretary without really changing the responsibility, so it would be S/CFA instead of U/CFA. WILSON: That's very good. That's about as humorous as the first
acronym of Admiral King's appointment, when it was CINCUS. MARTIN: That's right. I had one other interesting experience in the period of international trade policy, which involved the President -- although it's interesting only from my personal stand point I suppose. Between midnight and 1 o'clock one night in August I took my wife to the doctor, in a blanket, to the hospital with a temperature of 106 degrees. They started doing spinal taps, thinking she probably had spinal meningitis, although our doctor knew that she had had mumps and thought it was mumps encephalitis, probably. The next morning I was there with her things, about 6 o'clock, and then I had to take care of two young children who had some medical problems, and arranged for a neighbor to keep track of them while I went to the office. So when I left the hospital in the morning there was an argument whether she had infantile paralysis or spinal meningitis or mumps encephalitis, so I was a rather shattered person, with no sleep to
speak of. Then about 11:15 my secretary called me; we were in one of the annexes then and rather low down in the Department. She was all aflutter, and said, "Secretary Marshall is on the phone." This was unprecedented; he didn't operate this way. Anyway, he said, "I'm seeing the President at 12 o'clock and I want some talking notes, not memoranda, on what I should say about our differences with the Secretary of Commerce on East-West trade." Marshall's best expression that I heard him make of his position was that more battles had been lost in worrying about the enemy's strength, rather than your own, than from any other cause. So he thought that the emphasis on trade controls was excessive. Congress was being very difficult at this point. The working committee, which I attended (I usually attended the senior one also for Nitze who didn't bother too much with it) was chaired by Bill [William] Remington, who later on had trouble for reasons quite contrary to his role in this particular activity in which he had followed a very tough line.
So, I dictated talking points to the typewriter, because I had to clear them with the European Affairs, Soviet relations people, before I could give them to the Secretary. I think about a quarter till 12 a final draft was just out of the typewriter, and was on its way when Carl Hummelsine, Marshall's Executive Assistant, called to say, "Where is it?" It was the kind of a rush job that I would have liked to have had more time for. WILSON: Yes. MARTIN: It couldn't have come at a worse time for me. But it worked out satisfactorily and the President gave us some support and help. I think the next thing that I have any real recollection of is that in August of '49 I had been also representing the E area on an intradepartmental group chaired by George Kennan on what to do about NATO. He didn't have much interest in the subject, so I wasn't too active in this one, but I sat in on the discussions, what there were. There was
basically, as I recall it, an argument between the "dumbbell" theory and the "unified" theory. George, as I remember, was a dumbbell man; wanting the U.S. and Canada on the one hand and the European members on the other each to have their own organization for military cooperation; my instincts were otherwise. In the summer of 1949 it was decided to set up an Office of European Regional Affairs. George Perkins came in at that time as Assistant Secretary, but Tommy [Llewellyn E., Jr.] Thompson was the one who asked me if I would come over from the E area and help set it up. I did so. We had responsibility initially for the backstopping of NATO; we took over the political guidance of the Marshall plan and some of the staff working on that; we backstopped OEEC relations, the COCOM operations, and Military Assistance [Program] to the European countries. On that subject I served for a year or so with two hats because there was still a top structure under the Secretary that was coordinator in effect, of
Military Assistance, which was occupied by a series of people. It seems to me that after Walt Surrey there was Tom Cabot, of the Boston Cabot Corporation, who had just recently been president of United Fruit. He was a very nice man, but not really up to the job. And then there was James Bruce, who was our Ambassador to Argentina; he didn't take it too seriously. Next was Lloyd Birkson, I think his name was, who subsequently was head of Brookhaven Laboratory. He was in nuclear energy -- a nuclear physicist -- with, I think, the Carnegie Foundation. He was known locally as a Boy Scout, an Eagle Scout, a very energetic Eagle Scout type. They all saved me a lot of bureaucratic difficulties by permitting me to serve as head of their European section. In addition, I was the Bureau of European Affairs man responsible, so I dealt with myself. That made a little heavy workload now and then, let's face it. They also initially put into this particular office everything in the Bureau that wasn't country-oriented, like shipping policy, aviation policy, the
public affairs division, the labor man, etc. After a year or so this was proven to be too much, and these staff functions were put up where they belong with the staff organization of the Assistant Secretary for Europe, and we had just the operating roles. In this capacity we worked very closely, of course, with Dick [Richard M.] Bissell and Harlan Cleveland of the Marshall plan on ECA organization, not so much on the specific aid issues, although we did represent the country desks on country issues when some problems arose, but on the larger issues of European integration and things like that. It involved the broader things, the European Defense Community, that sort of thing, although that came a little later actually, and the European Payments Union. I remember going over to the meeting of the Interdepartmental Monetary Council the Treasury had. The Treasury took the view that the European Payments Union was a violation of Bretton Woods and everything should be global and anything regional was out; we had to argue against this dogma.
WILSON: You did as the State Department? MARTIN: Yes. WILSON: Cordell Hull must have turned over in his... MARTIN: Well, he was someplace else. But the only way to get to the global phase -- we were not there -- was step by step; get the Europeans strong enough to accept the global, and that was the way to do it. That was the argument. But we also had provided guidance to the Pentagon with respect to the Military Assistance Program, and the general NATO framework. Now, during this period, particularly when I was in this position, and it may have started a little earlier, there was another informal institution that in my judgment was absolutely invaluable to make the machine work. I don't know whether you've heard about this one. This was the Thursday lunch. WILSON: No, I don't think so. MARTIN: This was every Thursday at the Metropolitan Club,
which has very good food, and it was in the name of Paul Nitze because he was the only member, but we all paid him for our lunches. At this lunch there would be anywhere from 10 to 20 people; I would say 12 to 15 more normally. There was "Jebel' Halaby from the Pentagon, and maybe one other, and Frank Nash, who succeeded Jebe, from ISA (International Security Affairs) and was working on military assistance from that side. Others included Harlan Cleveland and Dick Bissell from ECA, Jack Ohly, who I think was in the Pentagon and then in Marshall plan, I'm not sure which order, and one or two others; Willard Thorp and myself and Paul Nitze, of course, from State. They were the primary ones as I remember them. Of course, when Linc [Lincoln] Gordon came back from Europe to be Harriman's sort of deputy in Mutual Security affairs, he sat in regularly. If people like him came in from out of town, they could participate. We were able in this group to talk out the interdepartmental squabbles. We were all good friends; we had similar technocratic,
shall we say, points of view. I mean it was flavored with politics, but still we were trying to do a job as officials. We were not fighting for political position. There were lots of problems that could have arisen, and there were lots of difficulties with bosses; I mean Louis Johnson, Secretary of Defense, was a very difficult character. And there were potential difficulties between State and ECA on many issues and points of view. But at the level just below the political, this group, I think, performed for three to four years an almost invaluable service. WILSON: Now this is absolutely fascinating because one inevitably gets, going over the paper that's left, a sense that much of the time could have been, seemed to be, taken up with the intradepartmental business. MARTIN: Always. WILSON: Yes. And that's one of the questions that I in a way have been asking Europeans -- did you have
difficulty meeting with Treasury and such. I was talking with Ambassador Christidis this morning and he was talking about the tobacco problem that came up in regard to Agriculture. What you're saying here is that informal relations or arrangements were made, at least on this case, that eased, shall we say... MARTIN: Ty [C. Tyler] Wood was another person who sat in. WILSON: Yes. MARTIN: I don't remember now that there was any Treasury person, or any Agriculture person, who sat in; I'm just not sure. I don't remember. Paul Nitze ought to have a list someplace in his records; he had a secretary for a great many years, who paid our bill. He must have a record of who was attending those meetings. That would be a good source. WILSON: Yes. Yes, I'm going to try to approach him. MARTIN: But he's one of those people that will remember,
I'm sure. We looked at the current problems, but we took longer looks from time to time and we generally met from 1 to 2:30 or 3 so there was time to talk. We had a private room and had a real chance to know each other well. WILSON: Where by that time was the Policy Planning Staff in the Department? Had it lapsed again? MARTIN: It existed, but wasn't really working on our issues. George Kennan was interested in East-West issues basically and this was not our primary concern. We were strengthening the West, and I don't recall any policy planning people participating in this sort of an exercise. The common saying around the Department at the time was that George was not only in an ivory tower, but the fog had closed in so he couldn't see the ground. WILSON: Only looking over the long distances? MARTIN: That's right. Anyway, as I say, I think this was a very important, informal instrument, that did
a great deal to keep things together. When Harriman came back to head up the Mutual Security Administration, the move involved a reorganization and I participated in all the talks about it, and its setup, as well as several others since. I've been unimpressed by where you put the organization; it doesn't matter all that much. The question is who are the people, what kind of cooperation do they have, and what kind of direction is there from the top. The replacement of ECA with the Mutual Security Administration of Harriman was not a difficult measure at all. Fortunately for me, my main contact was Gordon. I had known Harriman when working out the East-West trade business. I'd seen him in Paris frequently on trips over there on various problems. And Gordon I'd known from the War Production Board; I worked with him very closely the last six months I was there, and we were personal friends. I stayed with him when I went to Paris. So that this was a very easy relationship between State and them. Defense was much more difficult. When [Brigadier]
General [George H.] Olmstead became head of military assistance in Defense, I think State Department views usually became heavily discounted in principle before they were heard. This was much more of a problem than it had been. Frank Nash was no problem, and Halaby had been no problem, at the level which I would operate. And Bonesteel was no problem on that side of things, but Olmstead was really quite difficult. Then I was State Department observer, or advisor I guess it was, on the "Wise Men's exercise," which Harriman conducted, on how to bring together the cost of the forces the NATO military wanted and the resources the NATO countries were ready to devote to this purpose. Linc Gordon was his deputy on this; and so I went over and stayed for a few weeks, but not through the whole exercise. Then I did go back to London and to the Lisbon meeting in which we finalized the operation. This I thought was a superb example of Harriman's special talents for meeting with one or two or three or four people and taking them along. It was a superb job, given the
seriousness of the economic problems and the strength of the military role in this field. But the military were in the end realistic and this was a very successful operation. I had some connection in this period also with a military production supply board that was set up under NATO in London, which never worked effectively. I went over and visited once or twice; there was a chap whose name I've forgotten who subsequently became dean of the school of business at New York University. He was our head man in that, but it never operated effectively. I don't recall in any of this period specific guidance or direction or contact with the White House. I would see George Perkins, and to some extent, the Secretary in this period, but basically George Perkins and Thompson. I found myself spending most of my time on NATO matters, and not very much on Marshall plan-related matters, except in one area. Linc Gordon and I, I guess by different routes, were both fairly reserved about European integration
as the solution for all problems. I felt that Dick Bissell, in particular, in ECA where this was a major issue, was a very stubborn, arrogant man. The issue was being overplayed and would succeed better if it didn't have quite as much a U.S. label. It involved political levels of cooperation which would take a long time to create, and there were some dangers in trying to destroy national loyalties until something else had been put in their place as unifying, mobilizing engines., so to speak. It was a difficult period in our policies. So there was always a certain amount of tension with the all-out proponents. That includes Henry Byroade on the German side; he thought the German problem was the only problem. I gather from Mr. Acheson's book he felt the same way; I didn't get quite the same feeling at the time. WILSON: It isn't quite fair to say that this was basically State, against ECA? MARTIN: No, no. I was saying this was Linc Gordon and myself.
WILSON: Yes, that's interesting. MARTIN: There's a certain amount of us against the field but at a working level. There were differences with in State, but I think that on the whole -- where we got in was more on the tactical level -- and how much do you push the American interest up front, and how much you make it a condition of aid sort of issue which we felt was putting too much on it. So there was a fair amount of trading on this at that time, and that was continued to some extent. Then in May '52, I believe it was, they asked me to succeed Myron Cowen as special assistant to the Secretary for Mutual Security Affairs. Cowan had it for less than a year and I guess Livie [Livingston T.] Merchant for about a year before that. The job there was to represent the State Department with a staff of about 10 professionals, in dealing with Mutual Security Affairs, and with Stan [Stanley] Andrews on Point IV, to give State Department policy guidance on the military aid and
on technical assistance. This was titled, Special Assistant to the Secretary; I really worked with the Under Secretary, who was Dave [David A.] Bruce. I sat in on Acheson's staff meetings, but it was a rather technical, special sort of thing, and we dealt with the regional bureaus basically without too much top level involvement. WILSON: Did you get involved in the matter of the transition from the Truman to the Eisenhower administration? Planning for what would be... MARTIN: To some extent, yes. But I don't really remember very much about that actually, that is, specific things, although I'm sure we did do things. My recollection of my feeling of a major contribution being made was with the Point IV administration, which was new and green, and had no idea of how to deal with the Congress. We did a great deal of work with a man, it seems to me, who had been in Agriculture. He was sort of a program man, preparing presentations and he didn't have the vaguest idea how to go about
it, so we did a lot of their work. And we did a lot for the people that appeared on behalf of the State Department. WILSON: That's another time when there was a great squabble about where Point IV should be, but you would tend to play it down as being minor because you… MARTIN: Actually, Point IV was supposed to be autonomous within the State Department and Mutual Security was outside. WILSON: Yes. MARTIN: I had much more difficulty establishing satisfactory relationships with Andrews' Point IV people than with the Mutual Security people. I was invited to their staff meetings and never to Andrews'. It seemed that Andrews was an academic who was going to run his own show, and leave the State Department trying to keep up with him. He was a rough and ready farm type.
WILSON: As had been his predecessor. MARTIN: Yes. They were much more receptive. I finally found this fellow who was the chief program officer, who was really handling the ball, but realizing he needed help. We had a lot of experience with Marshall plan and Military Assistance presentations, and I'd had to prepare justifications worth being listened to. So we were able to help him. WILSON: Would you say that empire-building then was a function mostly of the people who came in, new at it, and not the people who had been around for awhile? MARTIN: No, not exclusively. I wouldn't say that. It's the individual and how he plays. I think it is true of the Government generally that one often finds somebody who has been top dog outside, whether in academics or in business, who finds it impossible almost to fit into the bureaucracy in which there is only one top dog, the President. And he's a
couple of steps removed from that. I spent four years in the War Production Board, and about 50 percent of the businessmen learned, and 50 percent never could. This is not unique in the case of Andrews, or anybody else, and I think it's a matter of personal work habits and attitudes rather than the fact they're new. Some of them fitted in very well. This is still going on; some of the people brought in might have experience with it, and some don't. We've got one in the State Department now that hasn't fit. Yes, he used to be the Wise Man in his area, whom people came to for advice, and he gave them very good advice. His advice is still very good, but in Washington nobody comes to you for advice. You've got to go out and fight for your views. WILSON: Yes. Yes. MARTIN: And live and learn -- how to wage the battle. WILSON: That's very interesting. But a person such as Acheson did?
MARTIN: Oh, yes. WILSON: He's a very impressive person. MARTIN: The Western lawyer type who's used to the advocacy-confrontation method. Of course, he came up through it, and did extremely well. WILSON: So he had his... MARTIN: He had his bumps. WILSON: Yes. MARTIN: Sure, but learned from them. Well, all I would say about the transition is that it was a very unpleasant time for me. I sat in on Mr. Dulles' staff meetings. Bedell Smith seemed to want to pretend I didn't exist, and when he had to recognize that I existed, he showed no interest at all in any of my views or experience. So after two or three months I went to Doc [H. Freeman] Matthews and said that I was still a civil servant at this point, not a Foreign Service officer. I
thought maybe it would be a good thing if I had some field experience for a couple of years, and got an appointment outside of Washington. General Smith and I were just never going to get along. I had gone over to Paris with [William T.] Draper as he took with him, to help him get started, the team from the various agencies set up in Washington to brief him. He worked us all half to death both before and after. So, I had gone over for two weeks, I guess to help him there. Then the new administration replaced him and said they wanted to cut the staff in half; they forewarned him. They picked as a replacement for head of USRO a New York gentleman named John Hughes, who had been chairman of the Executive Committee of Radio Free Europe and very active in entertaining U.N. personalities. He was a textile broker, and a major in charge of social activities on Pershing's staff in Paris in World War I. So I got the job as his deputy to do the cutting in half, which we
did in about six months. As I say, he was a charming, delightful boss, who realized where and when he needed help and knew what it was all about. After two years he was succeeded by George Perkins who was considered persona non grata for two years, because he worked for Truman. However, his first job out of Princeton was to head the office staff of Will Hays, a Republican Postmaster General. One of his family was a Morgan partner and so forth. Nevertheless, he had to go in purgatory for two years and he was a little unhappy about this. WILSON: I'm a bit baffled about Dulles' role in this period. When he comes in as Secretary of State, he takes this very strong line in a number of ways, including the political way, and yet he was involved in many ways, in Truman... MARTIN: Oh, he was. As Acheson points out in his book, the minute the campaign started, Dulles switched and started attacking the State Department. I had the feeling with him that there was an extremely
strong view that everything possible must be changed -- policy, method of organization, etc. Of course, Acheson points out that Eisenhower made a sharp break, too. WILSON: Yes. MARTIN: And the transition was made exceedingly difficult by this decision that the evidence of change must be completely dominant. Bedell Smith was in the same spirit, but very rough. I recall one meeting in which Bedell called into his office, four or five of us, who were in the top staff, including Paul Nitze, who was head of the Policy Planning Staff. The meeting concerned staff services for the Secretary, and handling problems that came up, in the course of which Paul made an observation, on what I don't know, to which Bedell replied very roughly and dogmatically, that he knew more about staff work in his little finger than Paul would ever learn all his life. Well, now, this was not the atmosphere which I had hoped
for, and so I was very happy in the middle of July to get to Paris for four years. We had the delegations to the NATO meetings regularly, and I came back and dealt with them. Things went reasonably well, although there were some interesting incidents. I remember in '46, I guess it was, when I went back to help work on the Dulles statement to the Ministerial meeting in December -- the three Ministers, the big meeting. He was going to stress the Common Market integration point, and we met Saturday morning and again on Saturday afternoon, and on each occasion in connection with the point of his speech, he went to the bookshelf and pulled out The Federalist for quotations. Well, I had heard this from some European-Atlantic "Federalist" types and others, but this was just the sort of thing that I thought was wholly unrealistic -- to apply that principle to the European situation. This was one of my problems with the integrationist types -- that they were thinking in what I thought were over simplistic terms
on the European scene. WILSON: We haven't been able yet to decide how much of that is rhetoric, and the rhetoric of course is rather coy -- the "United States of Europe," just do it sort of idea -- and how much of it was serious, or sincere. MARTIN: The other thing that I had a problem with, which was also one of Dulles' principal themes -- but his predecessors in this area were working on such a basis too -- Dulles was always fond of recalling that he made a commentary on the Atlantic Charter in '43, I guess, when he was asked to do so on behalf of the World Council of Churches in which he stressed European integration... WILSON: Yes, I read that. MARTIN: ...in order to bury the hatchet that had cost so many American lives between Germany and Austria and France. I had some doubts as to whether that was the best argument to use with the Europeans; and
also, particularly as the fifties developed, whether that was a still factor of importance. I was then suspicious of tendencies of people to fight wars and diplomatic battles, looking backwards instead of forward. My feeling now, to some extent, is that NATO was the most important thing there was at the time. I think that time is past, and I'm very happy that I am now involved in the future, the development problem, and even where the Soviet-American tension tends to be most critical as evidenced by the Middle East and Vietnam. WILSON: You've raised so many questions and gone over so many of the questions that I have, that I'd like to expand. MARTIN: Yes. WILSON: Well, just to pick up the last thread, if you were writing in this book, how much emphasis would you give to Point IV? Did people look forward to it at the time; or was it a spur of the moment...
MARTIN: I assume you've seen the article in the Foreign Service Journal on the origin of Point IV. WILSON: Yes. I have, yes. MARTIN: So, I think it was a spur of the moment suggestion like some others, some of which have survived and some haven't -- wherein the President wanted to say something new. I think it was a significant initiative. I think its impact at the time was not particularly great, and this was for a reason that made it one of the great battles within Congress and within the Government. Mainly, the Point IV people insisted and I shared their view, that without an appreciable amount of capital assistance to show how to do things, they couldn't just talk about it. So you needed money for investment on top of the technical assistance, and I think its limited effectiveness was, to a considerable extent, because this was not realized. I think also it had a limited effectiveness because there was inadequate appreciation, which is still growing and
has a way to go, of how different we do things from the way they need to be done in other parts of the world, for reasons of standards of living, cultural habits, etc. There is still a lot going on that shouldn't be done, but I think in Point IV we were just learning this, and we still are. In this Department we started the learning process. I remember one incident in which we sent a lot of technicians with electric pumps out from our Utah-Nevada area to Pakistan, the dry areas, to help them with irrigation. Well, they found too late that the pumps had to go to Karachi to be repaired. They learned a lesson and got a couple of engineers to try to design a pump that, apart from a major breakdown, the farmer could repair and keep up. Well, this was the beginning of learning and we had a lot to learn. But I think it made an important contribution. Now, what we didn't realize, and I thought people were learning at the time, for example, was that our agricultural seeds were no good anyplace else. Our boys were in the process of
learning this in Mexico at this time, that they had to develop a completely new form of seeds to be used in Mexico. WILSON: The ultimate result is the Philippine rice strain. MARTIN: The rice strain, and the rice people were able to pick up on this and not have to relearn; that's why the Philippine operation was such a success. So I think that there has been a growing benefit from this. It was the start, of course, of getting the universities interested in overseas activities. Stan [Stanley Andrews] was pretty good at this. It was his background, and, of course, Hanna's background too. This was important; it was used, or misused, as time went on, and fashions have changed, but we started then. So I think that in many ways it was completely different from the Marshall plan. There were some similar things, e.g. the productivity teams, which were very important in the Marshall plan, and we had
a little bit of this sort of a thing. But in terms of individual experts and so forth, this was really a primary invention that got us off the ground. WILSON: What about the political aspect of Point IV? That is, some of the work was to be done in areas which were part of the colonial empires, but there was this effort of ECA to increase production, partly in strategic materials, from the colonial areas. Were there difficulties with that as a limitation on Point IV? Don't do certain things in Point IV which would cause the natives to... MARTIN: I don't remember. WILSON: Yes. MARTIN: I just don't remember these specific instances in either case, although I do have an impression that the British and the French were quite insistent that we work through them and not make a move without telling Paris and London first. But this was not a wholly unreasonable position at this point in
time. Operationally, you almost had to. There were some enthusiasts who wanted to do otherwise, but this was almost an operational requirement. WILSON: Taking a slightly different tack from this, one of the themes, perhaps the chief theme that a historian derives from Acheson's book, is the tremendous emphasis on Europe in the period. The question I suppose I wish to ask is: Is it correct to think that it was almost exclusively Europe oriented, that... MARTIN: At the top levels, yes. I would think that is probably right. There's another comment that Willard Thorp had to make. He was here just ten days ago. He was my predecessor in this job. He said that you would have thought there were no economic problems, by reading the book. WILSON: Yes, that's true. MARTIN: I said that it was my impression, from what I had
seen of Acheson, particularly in the period in which I sat in the staff meetings, that despite his record in the Treasury and as Assistant Secretary of Economic Affairs he just wasn't really interested in economic policy. This didn't arouse his intellectual capacities. He did what was necessary, but economic issues weren't things that interested him. He almost gave the impression of not really understanding economics, which I think is probably not true, but one got this impression very definitely, that this was really a second-rate show as far as he was concerned. Of course, a number of his colleagues of the time were in the same position. Even Eden and Churchill had the same reputation, and I don't know so much about Truman, but certainly Roosevelt was not an economic genius. WILSON: Yes. Well, I think that is true. MARTIN: And Eisenhower was even less so. Acheson does have an interesting economic story that you may or may not have heard, about the Bretton
Woods Conference. He was telling once at a staff meeting -- right at the end -- of how he earned the Pulitzer Prize for someone else. He had gotten acquainted sometime earlier with a Philadelphia newspaperman named Carl McCardle, and at the end of the first day of serious discussion at Bretton Woods, Carl dropped into his room and said, "Can I come in?" He said, "Sure." Carl said, "I've got to write a story for my paper, and I don't understand a thing that was said today. This was way over my head. What went on?" So Acheson explained to him the principal issues that had developed, and this happened each day, and Carl got a Pulitzer Prize for his work on Bretton Woods. He didn't put this in his book. Carl, of course, was coming in and pretending ignorance to some extent which is a good tactic for a press man. A very interesting story at the time. WILSON: I have the impression also that Averell Harriman was not at all that interested in economic matters either.
MARTIN: Not really; he was interested in the political side of economic matters, but not really economics per se. Here at the OEEC he showed a great political sense for seeing people and attending meetings when there was a political issue. He was aloof; he was the man to appeal to in the last resort on the basic political problems. It was a skillful operation from that standpoint, but he did hold himself in; I think he can get into the details and understand them but this isn't the most fun for him. I think this is true; I've worked with him quite a lot of places. One of the interesting byproducts of all of this is that in 1963 there was a meeting of the Inter-American Economic and Social Council which is part of the OAS system and not the U.N. system, in Sao Paulo, and Harriman was named as the chief of the U.S. delegation. I was then Assistant Secretary for Latin America and Linc Gordon was then Ambassador to Brazil, so that he and I were his two principal advisors. That is when we got agreement from the Latin Americans on the Inter-American Committee for
the Alliance of Progress, which reviewed a country's economic programs. It was clearly modeled on the OEEC annual review, and the NATO military annual review which we set up in Lisbon. I came over from Washington first and then when I moved to Paris in '53, sat as a U.S. member for the first three years of the NATO review. So Linc and I and Harriman transferred that piece of Marshall plan and NATO experience to Latin America, and it's the only region in which there is this degree of cooperation. President Nixon has just agreed that the U.S. program on Latin America can be examined, in addition to the U.S. domestic economic policies which previous administrations had refused, Johnson's in particular. There was an interesting carryover in that sense of the... WILSON: I've been very much impressed by the continuation in Europe of the experience so many Europeans had in OEEC, and particularly their continued interest and involvement in that.
MARTIN: We tried to abandon some of the things that were started in OEEC. I represented the U.S. at the official level back in '61 when we converted the OEEC to the OECD, and as part of this operation we tried to get a lot of the things that were Marshall plan carryovers, like a lot of industry committees, dropped. But even our own Department of Commerce wouldn't support it; the businessmen thought it was useful. So we had great difficulty adjusting the organization by dropping things started on the Marshall plan, and to take up more immediate problems like development and environment and so forth. That momentum carries forward, and sometimes too strongly. WILSON: One aspect of the question which you've alluded to and the matters you've alluded to -- that is, East-West trade, the problems of European contribution to military support -- how would you characterize the role of Congress in that? Were things done because it was known that Congress would not go... MARTIN: On East-West trade, that was entirely an executive
branch initiative. WILSON: You had the Battle Act. MARTIN: The State Department started this well before the Battle Act. WILSON: Oh, I see. MARTIN: In the State Department, in August '67, Ty Wood, who was then Deputy Secretary of Economic Affairs and Tommy Thompson who was Deputy of Economic Affairs, asked if I, as a sideline to having the four occupied areas affairs, would chair an intradepartmental committee on economic relations with the Soviet bloc. I think the breakup was definitive by then, and we had to relook at things. Among the leading issues was aviation relations. There were some shipping problems and the trade question almost came later. So when I got back from London in September we had a series of meetings and toward the end of November, just before going to the Foreign Minister's meeting, we submitted a report on
the policies that we recommended. At the same time Harriman had a group working in the Commerce Department on this question. And the two approaches were married in the early part of '48. The Battle Act was subsequent to that so this was an executive initiative. Now, the Battle Act put tighter straightjackets than we probably would have liked, and we had some trouble with the Commerce Department under Harriman's successors in there. It continued on down the years, and I was still having it in '61 and '62. The Joint Chiefs -- in Defense -- were the worst. I can recall one case in which they wanted to reject an application to import an enamel into Czechoslovakia to paint refrigerators because they said it can also be used to paint tanks. There was a case in which we shouldn't export wool to Poland because it could be made into uniforms. Well, maybe that's a good idea. I mean, this was the kind of an issue that one ran into, and it was very difficult to take a reasonable U.S. position as far as the Europeans were concerned, for whom this was much more important.
WILSON: Yes. MARTIN: And to get a common position with them was a very tough negotiating problem. I spent a lot of time back and forth at meetings in Washington and at meetings in Europe on this. I recall I chaired one in Paris and one in London, meetings of all economic counselors in Europe. A good part of our time was spent on how to get a unified position on this question, because this was a State Department, as distinct from an ECA issue, really. But this was a very difficult one to handle properly. It also took a technical expertise which was difficult for the State Department to match against Defense and Commerce that had resources for it -- technical judgments about whether a product was of military significance, was unique, or wasn't. In a good part of this, Harriman had an independent view which never prevailed, which he didn't press hard, but raised to be looked at from time to time; namely, that for at least some products, the more dependent they were on imports from us the weaker they were. In other
words, if we could export things to them, which they could not make themselves, then in the case of crisis we could cut them off and they were in trouble. WILSON: DeGaulle's argument on dependence on U.S. industry. MARTIN: Yes. The opposite of this was that they would be, as fast as possible, building their own capacity for any crucial item. And as long as they could get the things from us, it released resources, technical and investment resources, to build up the replacement capacity. So these were the two basic arguments that were in conflict on how to deal with the problem. WILSON: The last question I will subject you to goes back to your earlier experience. There's almost no information in the Truman Library about the occupations -- some about Germany, but, of course, absolutely none about Japan. I think I know some of the reasons for this, but can it be concluded that there were two empires in a sense, Germany under OMGUS, and...
MARTIN: Well, it was quite separate in operations; it was quite separate as far as Washington was concerned. I mean, there was a single unit in the Pentagon, and subsequently the State Department set up an Assistant Secretary who came over from the Pentagon. For a period the German unit and the economic unit for Japan and Korea had a single office director. Don Wallace was director for awhile; [J. Kenneth] Galbraith was director for a period, until he got into a fight with Clayton on cotton policy in Germany, on which Clayton had some views, being a cotton man, and Galbraith quit. But each was very much an independent type of show. The Japan occupation was, as you were saying, of much less interest generally, than the German-Austrian one. Germany was the power to be concerned about. Of course, [General Douglas] MacArthur in Japan had always operated much more independently, although in the end Clay, I would say, was about as independent and difficult as MacArthur. I have had Clay offer me his resignation a couple of times,
which was his standard tactic if you made a suggestion he didn't like. He'd say, "I'll resign; you take over if you like." But it's also true, of course, that Morgenthau and the Treasury people were only really interested in Germany. The political forces were German-oriented, not much Japanese. Actually, MacArthur was very observant of directives from Washington. He did insist on seeing them before they came out, and there was a colonel on the Joint Chiefs who went over all directives for phraseology to be sure they would not irritate MacArthur's sensibilities. He, of course, never let OSS into his theater. He let a State Department man come over, after some argument, but he played a very subordinate role as compared to Murphy in Germany. But the Washington directives with respect to agrarian reform and the Zaibatsu, he complied with them. He always played a military role in complying with the directives received from Washington. And his comments back on drafts, to my
recollection, were not major in the sense of trying to call the shots. There were often disputes in Washington, in the State Department, with some of the older line political people. In terms of one of them who was in his late seventies, they always referred to them as the "poor, dear Japanese" which didn't go down well with some of the people at that particular point in time. My impression was that if one got to MacArthur, and things got to his attention, you got sensible responses and compliance. It was the 200 percenters around him that were the problem; they had been with him for a number of years. Whether they had Presidential ambitions for him or not I don't know, but they were much more rigid, much more difficult; they over-protected him. I felt he had been a big shot for so long that he didn't know how to break through his immediate entourage anymore. And this was where the problems lay. When Joe Dodge, president of a big Detroit bank, went over to sell devaluation, he was able to deal with MacArthur and there was
excellent cooperation and action. He was picked with this in mind. From what I saw, I thought the problems were in getting through to him, not in his reactions -- from what I saw and heard from others in this respect. I wrote a short book, * and Bob Fearey wrote a longer supplement** to it. It was done on weekends and nights; it is certainly imperfect. Of course, there are, I'm sure, lots of documents around the State Department. I do not have my files for that period; they seem to have disappeared. But there are one or two people who were in the State Department mission at the time. Atcheson was killed; he was head of the mission. But there's a fellow named Charlie Hodge in Washington who was there. WILSON: Is that the George Atcheson who had been in China, and had some difficulty? MARTIN: I'd think so. WILSON: Well, I should ask, as the final, final question, on instructions from the Director of the Truman *Edwin M. Martin, The Allied Occupation of Japan (American Institute of Pacific Relations, 1948). **Robert A. Fearey, The Occupation of Japan, Second Phase: 1948-50 (New York: Macmillan, 1950).
Library, whether you've made any commitments about your papers. MARTIN: No, I have made none. I've been solicited by the Johnson Library, and by the Kennedy Library, and I've done nothing. WILSON: Yes, well, I'm not the proper person to make a solicitation, but I'm sure they would be... MARTIN: I haven't kept a great many things back too far, and I suspect I would not have any interest in supplying the Johnson Library. I was in Argentina essentially all that time, and a secondary person in the administration. I had a much more intimate connection with Kennedy, as Assistant Secretary for Latin American interests, and if I did anything on Presidential libraries, I would be tempted there. I've made no decisions. I have not been approached by the Eisenhower Library, and would not expect to be. WILSON: I'm sure you have been told this -- and I'm only
indirectly connected -- all these people while they are in a sense competing for papers, are most concerned that the papers go somewhere. And they believe, I think quite correctly, that it's much more practical to put them in one place, as the Kennedy Library; all your papers are... MARTIN: I would think that that makes sense. I think that's right, but I've made no decision at all. [Top of the Page | Notices and Restrictions | Interview Transcript | List of Subjects Discussed]
Acheson, Dean, 29-30
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