I.L.O. Report 32.

1. In order to give fair warning of the statement I intended to
make and make sure that the matter had been considered on the
highest levels I asked Sir Owen Dixon to act in Washington. [2]
The matter was considered by Hull as well as others. The reasons
given for rejection is draft too inclusive and I.L.O. not wholly
appropriate.

2. The Committee met in the evening and the United States
introduced our agreed draft [3] amended [4] so as to exclude
anything which would suggest the employment agreement [5] thus
leaving themselves and the Committee free to vote for our
resolution of further conference. [6] 3. Nevertheless I made the
statement tracing the history of the negotiations and regretting
that Australia and the United States Government could not reach
agreement.

'This Committee should know that this is more than a mere
difference of view between the two Governments. The disagreement
between our two Governments has revealed a fundamental weakness
which is likely to threaten the whole future of the United Nations
economic collaboration.'
Later I stated-
'The Delegates will know that at the present time negotiations are
in progress regarding monetary policy and the United Nations have
under discussion other matters of economic collaboration such as
commercial policy. It is our attitude and it must be the attitude
of every country greatly dependent upon overseas trade that we
cannot possibly restrict our freedom of action with regard to
monetary and commercial policy without some assurance that high
levels of employment and consumption will be maintained
particularly in the main consuming areas. We considered that it
was not too much to ask the nations to undertake to maintain high
levels of employment, to undertake certain action if employment
fell off and to undertake to discuss employment policies at an
International conference if unemployment threatened. Apparently
these are undertakings the United States Government is not
prepared to consider at this monetary conference'.

In elaboration I stated-
'Speaking for a country greatly dependent upon world conditions I
have to say that if the United States Government is unwilling to
undertake some employment obligations we must hesitate before
entering into discussion on other aspects of International
economic collaboration and we could not be ourselves obliged to
undertake any commitments which limited our freedom of action to
protect our economy against depressed conditions overseas.'
4. Miss Perkins from the chair and other United States delegates
privately thanked us for the fair and clear presentation of our
case. This I took to mean confirmation of previous statements that
they now understood and appreciated our point.

5. We objected to the procedure and had the vote taken first on
our amendment to the United States draft which we submitted
originally, that is agreed London text. [7] We did this to test
the meeting rather than hope to get support as the United Kingdom
had already condemned it and supported the United States. However,
we lost only 22 to 17, South Africa and Canada not being with us.

We then voted on the present American draft and, though we could
not object to any of it, we objected on the grounds that it was
avoiding important issues. New Zealand and the progressive South
Africa employer [8] were only votes with us. The vote then taken
on our original proposal for further conference [9] and passed 27
to nil. Canada did not vote as they do not want I.L.O. to be used.

Employers did not vote. All through the workers and small
countries were behind us and with a little more education on this
line we can get overwhelming small country support. It must be
realised that this is one of several matters at this Conference
and while we have never missed an opportunity the education
process is not complete. The plenary session is still to meet to
receive reports of the Committees and we shall raise the issue
again. [10]

6. In summing up we have made our Article 7 position crystal clear
and yet in such a way as to make the United States on the
defensive as being the main party holding up Article 7. We have
also prepared ground for an employment conference. We shall not
take any steps re conference in Canberra until we can obtain
United States support as transport and other difficulties would
have to be overcome. As they have started a strong appeasement
campaign and the State Department has already taken steps to see
that we do not leave the country without further discussions the
whole outlook seems improved.

7. Have just seen Dominions Office 107 [11] and Dixon 414. [12] I
would interpret paragraph 4 of Dominions Office 107 as meaning
support on Employment Draft. But United Kingdom Delegation opposed
us. This together with the known activity of the Embassy in the
last few days and Dixon's experience outlined in his 4,4 makes me
suggest that the Embassy here is out of sympathy with our approach
and out of step with the somewhat changed attitude of the United
Kingdom officials in London.