My dear Prime Minister,

I regret that, in writing to you about the work of the Economic
Consultative Committee, I omitted to refer to one point, namely
the recommendation made by the Economic Consultative Committee to
the Economic Organisation of the League that consideration should
be given to the idea of summoning a conference of business men,
including both producing and consuming interests, to study the
possibility of the increase of world trade in certain definite
groups of commodities and the further suggestion that the
commodity chosen should, if possible, be one of equal interest
both to industry and to agriculture and the consequent suggestion
that agricultural machinery might be the subject chosen.

This recommendation was the result of a strong initiative taken by
the British Delegation. You will remember that last year it was
decided to recommend to the Economic Organisation that studies
should be made of certain definite commodities with the object of
seeing to what extent it was possible to arrange for nations to
take unilateral action so far as these commodities were concerned.

The Economic Organisation decided to select for study cement and
aluminium. They then proceeded informally to consult certain
Governments as to the willingness of these Governments to take
part in a conference on the subject. The results of these
consultations were unsatisfactory.

Sir Sydney Chapman [1] strongly expressed the view that two
mistakes in policy had been made. Firstly, in attempting to induce
Governments to be formally represented in a conference of this
sort and, secondly, that a discussion on a single commodity was
quite unpromising and that better results might be achieved
through the study of a group of commodities.

The whole British Delegation were quite solid on the desirability
of avoiding direct approach to Governments by the League and
substituting therefor a conference of business people definitely
concerned with a group of commodities. They were also strongly of
opinion that agricultural interests should be brought into the
picture.

At the meeting of the British Empire representatives, I very
strongly urged that if this proposal was put forward, it should be
based not on the idea of summoning a Conference of business people
to discuss the reduction of tariffs but to discuss the
possibilities for the improvement of world trade in the group of
commodities selected.

W. T. Layton [2] and Mr. Pugh [3], the Trade Union Representative,
were rather opposed to this line of thought but Sir Sydney Chapman
and Mr. Mitchell [4], the President of the Association of British
Chambers of Commerce, supported me. I also urged that no definite
reference should be made to agricultural machinery. In this,
however, I could get no support. When I came to study the draft
report, I found that the way in which the suggestion was actually
drafted was sufficiently ambiguous and harmless to render public
opposition on my part unnecessary and, I think, undesirable. I
therefore made no comment when that section of the report was
under discussion.

The section of the report to which I refer is the first paragraph
on page 22 of the draft report forwarded to you. [5]

Yours sincerely,
F. L. MCDOUGALL