199 McDougall to Hodgson
FOOD AND AGRICULTURE
Now that the Interim Commission  is approaching the completion
of its task on the constitution of the F.A.O., it may be useful if
I return to a subject touched upon in several of my memoranda,
namely, the importance of the early establishment of the F.A.O.
This issue can be viewed from a number of angles including (1) the
standpoint of world welfare, (2) its bearing upon the Australian
view of international economic policy, (3) its relation to
Australian commercial interests.
2. Australian International Economic Policy
The Australian view regarding international economic affairs is
based upon the assumption that what may be described as Part I of
Article VII of the Mutual Aid Agreement (i.e., increase in
production, employment, exchange and consumption of goods) is a
prerequisite to successful international action concerning
I believe this view to be based on valid political, economic and
Vigorous international action in the field of food and agriculture
can make a large contribution towards the fulfilment of this Part
I of Article VII. It is by no means certain that agreement will be
reached in the near future on questions of commercial policy or on
the other points of the Article VII discussions. if, however, the
F.A.0. can be launched upon its duties at a moment when the world
is especially food conscious, it may well set a pattern towards an
expansive economy. While the general acceptance of policies of
'full employment' by the industrialized nations may prove of the
greatest importance, the advocacy of employment policies needs to
be kept closely related to progressive improvements in living
standards. Food and agriculture is a relatively non-controversial
approach to improvements in living standards.
Australia has played a leading role in bringing the economics of
welfare on to the international stage, i.e., Food and Agriculture,
and Full Employment. The early establishment of the F.A.0. and
vigorous international action to secure that as many nations as
possible take action to put into effect the recommendations of the
Hot Springs Conference is therefore entirely in harmony with
Australian international economic policy.
3. Australian Commercial Interests
The policies adopted by other countries regarding the production
and consumption of agricultural products are obviously of great
interest to Australia.
If the nations, and in particular U.K., U.S.A., and Western Europe
really give the nutritional needs of their own peoples full
consideration in the framing of policies, the results should be
substantially to increase world demand for many food products.
As a recent paper  by Professor Scott Watson  (forwarded to
External Affairs) has shown, a continuance after the war of war-
time measures to ensure adequate milk for the women and children
of the U.K., together with a return to pre-war consumption by the
normal consumers, would require a 30% increase in British dairy
herds. A somewhat similar position would occur in Western Europe.
Sound nutritional policies should also result in the United States
devoting more land to dairying and probably less to wheat.
The consequence of such policies upon world import demand for
wheat might be of the order of Some 200-300 million bushels. Wheat
imports into continental Europe (i.e., excluding the U.K.) for the
period 1925-29 were around 300 million bushels and from 1935-39
nearer to 150 million.
If milk consumption is substantially increased to meet nutritional
needs, import demands for butter and cheese should continue to be
World import demands for meat during the first five years
following the peace will depend upon importing countries having
means of payment.
The present trend of nutritional research is emphasising the value
of high quality proteins to disease resistance and this may be
reflected in new standards of adequacy for such foods as meat,
fish and cheese.
World demand for wool and other agricultural textiles is likely to
depend upon whether the nations put levels of employment with
rising standards of living in the forefront of their economic
social policies. Here, however, the competition of synthetic
fibres will have to be reckoned with.
F. L. MCDOUGALL