Senator HAWKES. Can any other countries do the same thing to us because of that thing that A did not like. I thought they could, as I read the charter.

Mr. WILCOX. I am not sure that I get your point, Senator.

Senator HAWKES. What I am trying to find out is, under this charter, is there any way in which a group of nations could band together so that if Nation "A" did not like something we had done they would withdraw equivalent concessions from us and they could be joined by X, Y, and Z, so as to put extra pressure on us? Mr. WILCOX. I believe the answer to that is "yes," is it not? Senator HAWKES. My recollection is, yes.

Mr. WILCOX. I think under article 35 of this draft, it would be true that the organization could permit more than one member to withdraw a concession if more than one member were affected, but in that case, assuming it were the United States in question, the United States could then withdraw from the organization within 60 days; or any other country in a similar position could do so.

Senator HAWKES. Do we withdraw within 60 days prior to 3 years? Mr. WILCOX. Yes, at any time that sanction is applied.

Senator HAWKES. Then, in other words, if there is anything that happens in there, of a nature that any one does not like, they can withdraw with 60 days' notice?

Mr. WILCOX. If a retaliatory action has been taken against them, they can then withdraw, yes.

Senator HAWKES. That is the only way in which they can withdraw prior to 3 years?

Mr. WILCOX. I think that is right.

The CHAIRMAN. With reference to article 35, I am reading the last sentence of it:

The Organization, if it considers the case serious enough to justify such action, may authorize a Member or Members to suspend the application to any other Member or Members of such specified obligations or concessions under this Chapter as may be appropriate in the circumstances. If such obligations or concessions are in fact suspended, any affected Member shall then be free, not later than 60 days after such action is taken, to withdraw from the Organization upon the expiraion of 60 days from the day on which written notice of such withdrawal is received by the Organization.

Senator HAWKES. That is what I had in mind.

The CHAIRMAN. Under chapter I, paragraph 3, appears the language

as follows:

To encourage and assist the industrial and general economic deveolpment of Member countries, particularly of those still in the early stages of industrial development.

That is dealt with in detail later on?

Mr. WILCOX. Chapter IV.

The CHAIRMAN. There is no reason why we should go into that now. My question goes to this: Did you change chapter IV substantially at New York City?

Mr. WILCOX. There have been some changes but not important changes in substance.

The CHAIRMAN. Is chapter II a complete text of the New York draft?

Mr. WILCOX. Yes, sir.

The CHAIRMAN. Would you mind reading it, Doctor?

Mr. WILCOX (reading):

CHAPTER II. MEMBERSHIP

ARTICLE 2

The original Members of the Organization shall be those countries represented at the United Nations Conference on Trade and Employment whose Governments accept this charter by 194 or, in the event that this charter has not entered into force by that date, those countries whose Governments agree to bring this charter into force, pursuant to the proviso to paragraph 3 of Article 88.

The CHAIRMAN. Perhaps we had better refer to that.

Mr. WILCOX. Article 88.

Senator GEORGE. What page is that on, Doctor?
Mr. WILCOX. Page 52 [reading]:

Provided that, if this Charter shall not have entered into force by

194 ↑ any of the governments which have made effective the General Agreement on Tariffs and Trade dated 194, together with any other governments represented at the United Nations Conference on Trade and Employment, may agree to bring this Charter into force among themselves in accordance with arrangements which they may agree upon.

The CHAIRMAN. What page of the New York draft?

Mr. WILCOX. Page 52. It is at the bottom of the first column and goes over to the top of the second column. [Reading:]

Any instrument of acceptance deposited with the Secretary-General of the United Nations shall be taken as covering both procedures for bringing this Charter into force, unless it expressly provides to the contrary or is withdrawn.

To return to chapter II, paragraph 2 of article 2, it reads as follows: Subject to the approval of the Conference, membership in the Organization shall be open to other countries whose Governments accept this charter.

3. The Conference shall establish procedures which will open a membership in the Organization to the United Nations on behalf of the Trust Territories for which the United Nations is the administering authority.

The CHAIRMAN. Referring to paragraph 2 that you have just read, what will be the standard for approval or rejection of applying members?

Mr. WILCOX. I suppose that is to be developed by the Conference. I do not think it is laid down in the document.

The CHAIRMAN. Do you think there is any point in putting it in the document?

Mr. WILCOX. No, I think it might be left open to the members of the organization to determine after the organization is set up.

The CHAIRMAN. With reference to paragraph 3, whether or not a trust territory comes under your organization will primarily be a matter of concern for the United Nations Organization, will it not? Mr. WILCOX. Yes; I should think so.

The CHAIRMAN. In other words, you are not setting up any separate body of law in respect to trust territories inconsistent with the provisions of Charter of the United Nations relative to the subject?

Mr. WILCOX. The point is that there might be a territory which would otherwise be excluded from membership that might by this device be accorded representation.

The CHAIRMAN. Is the New York draft on chapter III a complete text?

Mr. WILCOX. Yes, sir; it is a complete text.

The CHAIRMAN. We will not have to refer back to the London draft?

Mr. WILCOX. No.

Senator, the New York draft is complete; there is no article left out of it.

The CHAIRMAN. I see. Well, that simplifies it.

Go ahead, sir.

Mr. WILCOX (reading):

CHAPTER III. EMPLOYMENT, EFFECTIVE DEMAND AND ECONOMIC ACTIVITY

ARTICLE 3. IMPORTANCE OF EMPLOYMENT IN RELATION TO THE PURPOSES OF THIS CHARTER

1. The Members recognize that the avoidance of unemployment or underemployment through the achievement and maintenance in each country of useful employment opportunities for those able and willing to work, and of a high and steadily rising effective demand for goods and services is not of domestic concern alone, but is a necessary condition for the expansion of international trade, for the well-being of other countries, and in general for the realization of the purposes of this Charter.

Senator HAWKES. May I ask you, Dr. Wilcox, why do we say "for those able and willing to work"?

Mr. WILCOX. Because we took that wording from the Employment Act of 1946 which was passed by the Congress of the United States. Senator HAWKES. Do you think that is a good clause to be in there? I think that everybody that is able to work ought to have to work. I mean this very seriously. I think if we are going to try to fix this world up so that only those who are willing to work are compelled to work, that we are just going into a complete 100 percent socialization of the whole world. We are going to be a mongrel part of a mongrel world. I think that is an aim that is far too great for any of us to seek at the present time. That belongs to the millennium.

I am serious about this, Mr. Chairman. I would like to say that I do not understand why we use the words "those able and willing to work."

Do you not feel that you should work?

The CHAIRMAN. I would not compel any man to work.

Senator HAWKES. Would you hand him as much as the next fellow? The CHAIRMAN. Oh, no; there is a vast difference between the two. Mr. WILCOX. I continue [reading]:

2. Members agree that, while the achievement and maintenance of effective demand and employment must depend primarily on domestic measures, such measures should be assisted by the regular exchange of information and views among Members and, so far as possible, should be supplemented by international action sponsored by the Economic and Social Council of the United Nations and carried out in collaboration with the appropriate intergovernmental organizations acting within their respective spheres and consistently with the terms and purposes of their basic instruments.

ARTICLE 4. MAINTENANCE OF DOMESTIC EMPLOYMENT

Each Member shall take action designed to achieve and maintain full and productive employment and high and stable levels of effective demand within its own jurisdiction through measures appropriate to its political, economic, and social institutions.

2. Measures to sustain employment and demand shall be consistent with the other purposes and provisions of this charter and in the choice of such measures each Member shall seek to avoid creating balance-of-payments difficulties for other Members.

ARTICLE 5. FAIR LABOUR STANDARDS

Each Member, recognizing that all countries have a common interest in the maintenance of fair labour standards, related to national productivity, shall take whatever action may be appropriate and feasible to eliminate substandard conditions of labour in production for export and generally throughout its jurisdiction.

ARTICLE 6. THE REMOVAL OF MALADJUSTMENTS IN THE BALANCE OF PAYMENTS Members agree that, in case of a fundamental disequilibrium in their balance of payments involving other countries in persistent balance-of-payments difficulties, which handicap them in maintaining employment, they will make their full contribution to action designed to correct the maladjustment.

ARTICLE 7. SAFEGUARDS FOR MEMBERS SUBJECT TO EXTERNAL DEFLATIONARY PRESSURE

The Organization shall have regard, in the exercise of its functions as defined elsewhere in this charter, to the need of Members to take action within the provisions of this charter to safeguard their economies against deflationary pressure in the event of a serious or abrupt decline in the effective demand of other countries.

ARTICLE 8. CONSULTATION AND EXCHANGE OF INFORMATION ON MATTERS RELATING TO EMPLOYMENT

The Members and the Organization shall participate in arrangements made or sponsored by the Economic and Social Council of the United Nations, including arrangements with appropriate intergovernmental organizations:

(a) For the systematic collection, analysis, and exchange of information on domestic employment problems, trends, and policies, including as far as possible information relating to national income, demand, and the balance of payments; (b) For consultation with a view to concerted action on the part of governments and intergovernmental organizations in the field of employment policies. That next to the last line there should come out because that is misprinted.

The CHAIRMAN. Does that complete that chapter?

Mr. WILCOX. That completes that chapter, I think.

The CHAIRMAN. Let us then go back to article 3, paragraph 1.

I believe you will agree that heretofore the matter of domestic employment has been exclusively a matter of domestic concern. Are we in agreement on that?

Mr. WILCOX. That depends on how you define the term "concern." It has been exclusively a matter of domestic authority and it would continue under the charter to be a matter of domestic authority; but the policies of individual States may have international consequences.

The CHAIRMAN. Of course, that is true, but here we are setting up an international organization and we are saying to that international organization that employment which heretofore has been exclusively a matter of domestic concern is now a matter which has to do with the expansion of international trade, it has to do with the well-being of other countries, it has to do with the realization of the purposes of the charter, and, therefore, if there is any sense in it at all, it becomes a matter of concern for this international organization.

Mr. WILCOX. Therefore, it becomes a matter of international con

cern.

The CHAIRMAN. Yes; it becomes a matter of international concern, and that international concern is lodged in this international organization.

Mr. WILCOX. No, sir, it is not.

The CHAIRMAN. Then what is the purpose of the paragraph and what is the purpose of the succeeding paragraphs on the same subject? Mr. WILCOX. The International Trade Organization, as it is envisaged, of itself, performs no function with reference to the maintenance of employment.

The CHAIRMAN. You state here that that would be the concern of the Economic and Social Council?

Mr. WILCOX. That is right.

The CHAIRMAN. You remember yesterday that the functions of that Council are recommendatory and have no force beyond that.

Mr. WILCOX. Yes.

The CHAIRMAN. And do you agree that there is nothing in this charter that is intended to give the Organization, by their set- up, any authority to deal with employment matters with any of the member countries?

Mr. WILCOX. That is right.

The CHAIRMAN. All right; let us proceed to paragraph 2.

Here you have a definite statement that members agree to something. They agree that while the achievement and maintenance of effective demand and employment must depend primarily on domestic measures, such measures should be assisted by the regular exchange of information and views among members and, so far as possible, should be supplemented by international action sponsored by the Economic and Social Council of the United Nations, and so forth.

I believe we have to go at this time for a vote.

We will adjourn at this time until Monday at 10:30 in the morning. (Thereupon, at 3 p. m., the committee adjourned until 10:30 a. m. Monday, March 24, 1947.)