New Instrument

POLICIES & PRINCIPLES

Lend-Lease's dramatic end (see NATIONAL AFFAIRS) brought home to the world as nothing else had the very junior status of Britain in her partnership with the U.S.

Just before the Lend-Lease blow fell, London's New Statesman and Nation (close to the Labor Government) observed: "British policy is limited by two factors--the American control of the technological processes concerned with the production of the atomic bomb and the complete dependence during this transition period of Britain's economy on American financial aid."

What this might mean in Big Power relations became apparent last week when the British speculated on whether their lend-leaseless poverty would force immediate withdrawal of military forces from Europe and the Far East to the detriment of Britain's postwar political position. Also directly involved was Britain's basic economic policy of government-controlled foreign trade and foreign exchange; as the price of U.S. credits, the U.S. might demand that Britain relax trade controls.

Was the U.S. moving toward employment of its enormous lending power as an instrument of foreign policy? One New York banker who commutes to Washington thought such use long overdue. Said he: "If I were permitted to characterize our credits over past years in one four-letter word, I'd use the word 'Gaps.' " He explained that U.S. diplomats dicker, and U.S. credit agencies lend, without much connection between them. Thus the diplomats often find they lack a bargaining weapon suited to everyday use in diplomatic give and take.

Although the U.S. was incomparably the world's strongest power, the world knew that the atomic bomb, for instance, could not be used unless the U.S. public recognized the objectives as genuinely vital to the nation. To achieve limited, non-vital objectives in Europe and Asia (see Col. 5), U.S. economic power seemed the appropriate instrument.

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