Economic Union

The U.S. and the United Kingdom joined hands this week in a Declaration of Principles which may well be the foundation stone of future economic relations between the two countries. The agreement moves to exorcise the specter of post-war debts; to break down tariff barriers on a scale undreamed of; to cement a post-war economic union. In Washington Acting Secretary of State Sumner Welles and Britain's Ambassador Lord Halifax signed the agreement.

By the agreement's terms, the President is given power to set the value of Lend-Lease aid at any figure he pleases. Against these debts, the President will balance the value of Britain's services by: 1) fighting the war virtually alone for a year and a half; 2) continuing to supply men & materials now. And in the final peace settlement the U.S. and Britain are bound to break down the imperial preferences and the Smoot-Hawley Tariff.

A statement was issued at the same moment in Washington and London: "Its [the agreement's] aims will be ... to expand production, employment, and the exchange and consumption of goods which ... are the material foundations of liberty and the welfare of our peoples."

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