Memoranda from James S. Lay to the National Security Council, with Attached Proposed Natonal Security Council Intelligence Directive Number 7

NET/PSF/NSC) 308 TOP SECRET NATIONAL SECURITY COUNCIL WASHINGTON February 9, 1948 MEMORANDUM FOR THE NATIONAL SECURITY COUNCIL SUBJECT: Provision of U. S. Equipment to the Italian Armed Forces REFERENCES: a. NSC 1 st: NSC Action No. 9 At its second meeting the National Security Council, in considering NSC 1, agreed that the possibility of furnishing equipment to the Italian armed for- ces should be further investigated. The Secretary of the Army subsequently submitted a report by the U. S. Army Survey Group to Italy, which concluded that the Italian armed forces are not presently equipped so as to be capable of performing their missions within peace treaty limitations. The State- Army-Navy-Air Force Coordinating Committee was subsequently requested to study this Army report and submit its comments and recommendations on this subject to the National Securiti Council. As an interim response to the above request, the enclosed report (SANACC 390/1) is submitted herewith for consideration by the National Security Council. The enclosed report concludes that the National Security Council should recom- mend that the President, despite the lack of specific legislative authority, direct the transfer to Italy of U. S. Armed Forces equipment and supplies, sub- ject to reimbursement to the forces concerned. SANACC then concludes that no transfers of Armed Forces equipment to Italy should take place until a feasible method of reimbursement to the services concerned is established. Since the enclosed report was written, the Department of State has been advised that the Italian Government considers this problem to be of the utmost urgency and is apparently prepared to provide reimbursement and pay the handling charges for at least a portion of the required equipment and supplies. Therefore, if the President issues the directive proposed in 13-e of SANACO 390/1, the Depart- ment of State plans to implement this directive by arranging for the necessary reimbursement to the forces concerned from the Italian Government. The National Security Council Staff therefore recommends that the National Se- curity Council approve the conclusion in paragraph 13-e of SANACC 390/1 and submit the proposed recommendation to the President for his consideration. DECLASSIPIED Gg* ARCHIVES TRUMAN "ANTIONAL AKD REGORDS E.O. 12958, Sec. JAMES S. LAY, JR. s of Bay DJM Date 5/29/98 Assistant Executive Secretary Enclosure : Copy No. of SANACC 390/1 TOP SECRET