File No. 841.51/874
The British Ambassador ( Spring Rice) to the Secretary of the Treasury ( McAdoo)
Sir: Adverting to my letter of the 24th [23d] ultimo with reference to the loan of $200,000,000 made by the United States Government to the British Treasury, I now have the honour to apply for a further advance of an equal amount on similar terms to cover the obligations of my Government falling due in the United States of America during the month of May.
In accordance with the suggestion made in the conference of yesterday it is proposed that the advance should be made in three parts, as follows: $50,000,000 on the 5th instant, $75,000,000 on the 15th instant and the balance of $75,000,000 on the 25th instant.
I take this opportunity of stating that the requirements of my Government for the next six months in the United States of America are estimated to amount to $1,500,000,000.
This figure may conveniently be divided into two sums. The first covers the existing open account in which the British Government are indebted to the extent of $400,000,000. A large proportion of this debt has been contracted on behalf of our allies, both by direct advances [Page 526] to them and by indirect payment on their behalf made over the London exchange in New York. It is hoped that this may be regarded as a first charge on the credits to be advanced by the United States Government.
The balance of $1,100,000,000 has been arrived at after a careful scrutiny of our requirements and effort to curtail them to the bare necessary minimum. It is based both on experience of the rate of our expenditure in the past, and on the actual present commitments of British War Department, which now amount to $650,000,000.
I beg to emphasize that in estimating our requirements at the above figure of $1,500,000,000 it is assumed that all the expenses of our Allies in the United States of America including their expenses for exchange so far as that is required in connexion with American transactions, and including existing commitments on their behalf for munitions for which we are at present responsible to the extent of $190,000,000 are disposed of by direct advances by the United States Government to those Allies individually.
I have [etc.]