File No. 658.119/18

The British Ambassador ( Spring Rice) to the Counselor for the Department of State ( Polk)

My Dear Mr. Counsellor: I am cabling to Mr. Balfour about all the points you raised yesterday.1 I am sure that you do not think that we have intentionally left you in the dark about these points. Our difficulty has rather been that we were uncertain which of the aspects of the problem were preoccupying you and have been concentrating our efforts on informing you as to facts and figures rather than as to forecasts. You have, however, doubtless read the general [Page 1031]survey of the situation in the personal memorandum1 handed to Mr. Woolsey at his request on July 5, which shows that we are fully alive to the considerations you put forward yesterday. I venture-again to urge the importance of some more satisfactory and direct means of obtaining expert information as to the military naval and political situation in Europe, as suggested at the end of that memorandum. We are of course most anxious to continue to furnish you information here where the deliberations of the Exports Council are proceeding, but you will realise that much of the information you require is of the kind which commonly forms the subject of consultations between the Allied Cabinets and General Staffs themselves and that diplomatic discussions on this side of the Atlantic can, in many matters, only convey to you a partial and incomplete-view of plans worked out and contingencies foreseen at London and Paris.

On thinking over our conversation, there is one point which I think merits further immediate consideration. If I may say so, I think you are quite right to exact as clear a forecast as possible from us before you embark on the full execution of a policy towards Norway, Denmark and Holland, even though the broad lines on that policy and the concrete ends we hope to gain are clear enough. Moreover, though all these questions are urgent in view of the present stage of the war, there is a sense in which the question of Danish and Dutch food exports to Germany can be suspended for a week or two without too serious consequences. A month lost in these matters might at worst prolong the war a month. In the case of Swedish exports of ore, however, a month lost now may make all the difference between gravely disturbing Germany’s munitions resources-before the end of the war on the one hand and on the other allowing her to protect herself fully up to the end of the war. As you know, the continuance of Swedish exports of iron ore for the rest of the Baltic shipping season will result in fully protecting German resources up to the end of 1918.

Now, in the case of Sweden, we have to reckon with hardly any of the doubtful factors on which you insisted yesterday.

To take first the military situation. Up to the end of 1916, to give a rough date, we were very apprehensive of pressing Sweden too far. So far as the British Government were concerned, we did not indeed, believe that Sweden would ever throw in her lot with Germany, but the Russian Government represented so strongly the disastrous effects on the military situation of any threat to Russian communications in Finland that we had perforce to adopt a cautious attitude at the behest of our ally. Our preoccupations are pretty [Page 1032]clearly set forth in the enclosed secret memorandum, drawn up in the Foreign Office at the end of last year, which I hope you will regard as very strictly confidential.1

In the first few months of this year, however, our apprehensions diminished and we finally came to the settled conclusion that the possibility of Sweden taking Germany’s part actively might be ruled out of consideration. We have proved this conclusion by practically blockading Sweden this spring and we have wrung from her in this way a most important concession in the form of the release of our merchant ships from the Baltic. We have no longer any fear that Sweden might go to war with us.

Per contra, real attack by Germany on Sweden would be the most serious military adventure she could undertake—so serious that the possibility of it need hardly be entertained. As to naval or air raids, Germany could only lose by such an outrage. The Socialist leader, Herr Branting, has urged in the past that Sweden should stop her exports of iron ore to Germany until Germany abandoned her submarine methods. Any armed raid on Sweden would merely make this policy inevitable for it would assuredly throw the pending election into the hands of the Liberals and Socialists and ruin the chances of the pro-German Conservatives. A Liberal Government carried into power on a wave of popular resentment against Germany could not yield to her pressure but would have no course but to break with her finally.

As regards our agreements, we have practically none with Sweden and have a practically free hand to join with you in any embargo policy, however drastic. We have only three agreements with the Swedish Government, namely, those relating to rations of cotton and lubricants, and that providing for the importation into Sweden of Norwegian and Icelandic herrings. Besides these we have agreements with various oil companies, providing for rations of mineral oils. There are just two other agreements with individual firms, one with the International Harvester Co. of Chicago, and one with the Goodrich Rubber Co. of London. The former of these two agreements and the regulation of all rations of cotton, lubricants and mineral oil are now in practice under the control of the United States Government, and not of the British Government—or will be as soon as the United States Government have prohibited the export of cotton. The agreement with the Goodrich Rubber Co. does not bind His Majesty’s Government to license exports to Sweden, and neither of course does the passage of Icelandic and Norwegian herring into Sweden come under the control of any British licensing authority.

[Page 1033]

There is one further agreement with the Swedish Government dating back to December, 1914, in which the British and French Governments engaged generally to permit Sweden to import from Allied countries materials or goods for the wants of Sweden “in so far as the same materials or goods shall not be absolutely necessary for consumption in Great Britain or in France, and providing also that such goods and the products manufactured therefrom are placed on the Swedish prohibited exports list.” This undertaking is, however, of a very indeterminate nature. Its actual character may be tested by the fact that during the whole of the five months, January to May of this year, during part of which time Swedish imports were being largely cut off, only the following goods were imported into Sweden from the British Empire:

Tons
Fresh fruit 626
Meat 326
Oil seeds, oils and fats 206
Tar and tar products 986
Textiles 1,234
Fibres, hair and bristles 124
Ferro alloys 516
Iron and steel 2,859
Zinc 1,562
China, earthenware and sand 1,153
Coal 220,297
Machinery 284
Miscellaneous 806

or a total of only 10,602 tons,1 excluding coal. In May only 715 tons were imported into Sweden from the British Empire, excluding coal.

I think there is no doubt that most if not all even of these exports could be cut off absolutely during such period as the United States may be pressing demands on Sweden, except two classes of commodities. The first of these commodities is, of course, coal, which for obvious reasons it would be undesirable to cut off, and the second is raw materials or semi-raw materials, exported to Sweden on behalf of the Ministry of Munitions to firms manufacturing for the Allies. An instance of such exports during the first five months of this year is the 1,562 tons of zinc. Some of the above exports have already been embargoed since the beginning of the year: e. g., animal and vegetable oils and fats as from May 29, tar as from May 2, and vegetable fibres as from March 13.

His Majesty’s Government have just offered the Swedish shipowners to supply Sweden with as much coal as she needs in return for the proper employment of Swedish ships.

As regards mineral oils and lubricants His Majesty’s Government, in return for a very recent undertaking by Sweden to enforce the [Page 1034]landing at Swedish ports of all fish caught by Swedish fishing boats, have agreed not to interfere with the resumption of such shipments, which have been for some time interrupted, on the clear understanding, however, that this agreement is entirely subject to the action decided on by the United States Government in connection with their licensing policy.

I think this gives you fairly fully the facts in the case of Sweden. If I were asked to make a suggestion it would be that the more urgent questions relating to Sweden could be taken up at once without waiting for our further reply to the questions raised by you yesterday, and without necessarily involving ourselves in the comprehensive discussion of all our desiderata.

As you know, in our view Sweden should be required to stop all exports to Germany; to maintain exports to the Allies; to employ her shipping fully in agreement with you and us, and to guarantee regular transit across her territory to and from Russia. Germany is no longer supplying Sweden with any important commodities; even her coal exports to Sweden have sunk to insignificance; Great Britain is ready to supply Sweden with coal and if there are any commodities from Germany on which Sweden is in some measure dependent, there is nothing that cannot be supplied to her by the Allies. If, however, the Swedish Government could be induced to prohibit all exports of iron, iron ore, steel, copper, pyrites, ferro-chrome, ferro-manganese and ferro-silicon, sulphate and sulphite pulp, and sulphuric acid from Sweden to Germany directly or indirectly, while maintaining her present rate of exports to the Allies, and if they would agree to make this prohibition effective by the end of August, this immediate concession would be so important that, in exchange for it and without entering into any binding agreement not terminable at any moment when it became advisable, it might be worth while to agree to issue licenses for the export to Sweden of the rations of lubricants and mineral oils already fixed in our agreements with the Swedish Government and the oil companies, and also to issue licenses for the ration of cotton provided for in the modus vivendi between the Swedish Government and the British Government of August, 1916. If Sweden, in response to a demand from the United States, were to accept such a proposal, the United States would still have in hand foodstuffs, copper and other articles for use in the discussions which would follow in regard to Russian transit, shipping, etc., etc., while if Sweden were to refuse, matters would rest where they are at present and we should in no way have compromised our position.

I should add that in order to influence the pending elections in Sweden any demands upon Sweden should, Mr. Balfour thinks, [Page 1035]be coupled with a public assurance that we strongly desire to facilitate the maintenance by Sweden of her neutrality.

I am so impressed with the urgency of the Swedish iron ore position, and also with your arguments yesterday, that I wish to indicate a method by which it would be possible to make important demands immediately without running the risk either of having to recede from such demands once made or of compromising the attainment of any one of the objects we have in view. I should not have ventured to make these suggestions if you had not asked us yesterday to make clear the kind of negotiations we have had in mind in the case of each neutral country.

Believe me [etc.]

Cecil Spring Rice
  1. See telegram to the Ambassador in Great Britain, No. 5236, July 31, ante, p. 912.
  2. Ante, p. 892.
  3. Not printed.
  4. If the items above are correct, this total should be 10,682 tons.