File No. 652.119/348
The Ambassador in Spain (Willard) to the Secretary of State
[Received December 24, 12.14 p.m.]
945. Department’s 796, December 21, 5 p.m.2 Embassy made suggestions contained in its 923, December 12, 11 a.m., because the Anglo-Spanish agreement concerning the exchange of coal and iron ore, so important to England, had just been signed, after many months of negotiations; at the personal request of the King; at the request of the Prime Minister and Minister of State; with the approval of the British and French Ambassadors; for the express purpose of combating in advance any chances either of retaliation or [Page 1221] unfriendliness toward Spain; and believing that the release of some of Spain’s many purchases in the United States, without changing our general policy of embargo, would create a good impression here. (Special reference is here made to last clause of Embassy’s 9231 and to Embassy’s 788, September 15, 11 a.m.2). I had also explained at great length to both the King and the Prime Minister and Minister of State that our embargo was not a retaliatory measure but for the protection of ourselves and our cobelligerents; that while we needed all these commodities, especially cotton, oils, and coal, yet if the Spanish Government felt that it was able to respond to the suggestion of ourselves and the Allies relative to a more repressive policy toward Germans interned in Spain and regarding permits to export of purchases made in Spain by Allies and purchases probably to be made by our Army in France, that then it might be possible for my Government to make the necessary sacrifices and to permit the exportation of certain commodities desired by Spain. Embassy’s course seems to have clearly demonstrated its good faith and created good impression since several newspapers now hold Government responsible for Spain’s failure to secure exports from United States, especially cotton.
Embassy has been informed by French Embassy that arrangements between United States and France looking to the purchase of supplies in Spain are now being considered in Paris. France is constantly making such purchases in Spain but French Ambassador is encountering great difficulty in securing permission to export. Embassy was on 20th instant informed of purchases here of dried beans and rice by American Army in France, and at the request of purchasing agent, American Expeditionary Forces, has asked Foreign Office for permission to export. However it is not anticipated that desired permits will be secured unless our embargo is strictly enforced in United States and Embassy instructed to negotiate reciprocal exchanges thereunder directly with Foreign Office. This Ministry is not friendly to the Allies or United States and no concessions can be secured otherwise than upon the basis of an exchange of whatever commodities respectively needed by the Allies and United States and by Spain. If withholding of licenses to export from the United States is discontinued, quoting threat in Department’s 796, then no permits to export purchases made in Spain for American Army in France can now be secured, and it is feared that such policy will materially weaken cobelligerents’ efforts to secure their desired permits to export. Therefore the Embassy feels that it is absolutely necessary to enforce our embargo [Page 1222] (with such modifications from time to time as were suggested in Embassy’s 923) in order to secure supplies for ourselves and allies freely.
Replying to last paragraph, Department’s 796 under consideration, Embassy is not informed as to Department’s policy or wishes in regard to our securing Spanish ship tonnage, although it has general knowledge of England’s desire and efforts to secure such tonnage. While in Paris I discussed Spanish situation freely but informally with McCormick and his associates, yet no lines were agreed upon between us; on the contrary McCormick stated to me that the general situation would be carefully considered and when definite conclusions as to policy were reached this Embassy would be instructed from Washington. Since that time I have received personal letter from McCormick in reply to letter from this Embassy regarding exchange situation here suggesting that I might get in touch with Crosby of Treasury Department now in London. Embassy has however taken no such steps but is anxiously awaiting Department’s definite instructions. Embassy is firmly of opinion that no concessions can be obtained from Spanish, chiefly owing to [omission] under this Ministry except along lines above indicated and as has been repeatedly suggested by this Embassy.