23. Mr. Reid said that a review had recently been made of Departmental files dealing with the exchange of information with the Soviet Union in an effort to ascertain how the exchanges have worked in the past and whether or not any advantage might be gained by attempting to expand the exchanges in the future. The tentative conclusions set forth in a draft report are as follows:

(1) The Soviet authorities will not agree to supply any information which they consider to have a military significance. If any such exchanges are suggested by us, the Soviet Government will misinterpret our motives and will attempt to take what they can and to give little or nothing of value in return.

(2) The files indicate, however, that the Soviet authorities were anxious in the past to exchange information on non-military subjects of a purely scientific, technical, social or economic nature. Past exchanges in these fields have been, in general, from 33 1/3 to 50 per cent successful. However, it was found that, while many cases of failure could be attributed to the Soviet authorities, theirs was not the exclusive responsibility, for many exchange operations were left incomplete by the responsible Canadian authorities themselves. If the Departmental files give a complete picture of the operation of past exchanges, the conclusion may be drawn that, had these exchanges been dealt with more energetically, much more profit might have been derived from them than was in fact the case.

(3) Provided the present political conditions in general and the Soviet Decree on the Disclosure of State Secrets of June 1947 in particular, have not adversely affected the situation, it may be feasible to attempt to exchange information with the Soviet Union on non-military subjects (scientific, agricultural, etc.) in the future, with some hope of success.

(4) The exchange of cultural material presents a special problem. So far as Soviet material entering Canada is concerned, a distinction should be made between cultural material of a serious nature, which would be of value to Canadian libraries, universities, etc., and "cultural" material of a purely propagandistic character. So far as concerns Canadian cultural material entering the Soviet Union, such material in the past has not been given the publicity, circulation, or publication acknowledgement within the Soviet Union necessary for the exchanges to have proved satisfactory from the Canadian point of view.

24. As the Departmental files were incomplete, and did not indicate, in many instances, whether particular exchange operations had in fact progressed satisfactorily, and had been of real value, it has been decided to circulate the report (based on the Department' s files) to the various Government Departments concerned, and to request the views of each Department on:

(1) The operation of past exchanges, and whether the material supplied by the Soviet authorities in the past had proved of real value;

(2) Whether it would be profitable and feasible to continue and to expand the exchange of material with the Soviet Union in certain specific fields.

25. The ultimate purpose of this enquiry is to formulate a firm policy regarding any future exchanges of information with the Soviet Union, and to ensure that any such exchanges are carried out on a strictly controlled basis, and subjected to periodic review so as to ensure that reciprocity is constantly maintained. (December 23, 1947)