102.1/1518: Telegram

The Ambassador in France ( Sharp ) to the Acting Secretary of State

6272. For McAdoo from Crosby. Number 682. From interview with Klotz,4a following results.

  • First. I stated that if he cared to have his representatives discuss with you matter of maturities of French obligations, you would be glad to do so. His reply in substance is this: that maturities which his Government would consider as desirable and fair to them will depend upon moneys made available to them from Germany as a result of peace terms, the availability in question to cover not merely the total amount, which may be large and stretch over many years, [Page 541] but also that availability within short period during which reconstruction is desired to be urged forward. If Germany is required, and is found able, to deliver large amounts of material to be directly used in France, or which may be converted into exchange in foreign countries, then French Treasury will correspondingly need less or perhaps nothing from the United States and might find itself in position to begin payment of its obligations. He, therefore, concludes that no definite arrangement could wisely be made at this time.
  • Second. In respect to the Inter-Allied Council, while agreeing that there are now few occasions in which its original functions are required to be performed, he would consider it unwise to dissolve it, since at some moment it may be desirable to refer questions to it under the agreement by which it exists.
  • Third. Concerning the amount of money which will be demanded from Germany, no conclusions can be reached until a clearer definition is agreed to between Allies as to the meaning of that clause in the armistice which refers to reparation. He assumes, at present, that if his own interpretations are followed, the amount asked for by all of the Allies will be large enough probably to absorb for many years, say forty or fifty, the annual increase of wealth in Germany before the war, estimated by Doctor Helfering [Helfferich]5 at ten billion marks.
  • Fourth. In view of the fact that Finance Minister a few months ago strongly urged settlement of question of maturity and now prefers delay, we may surmise he has in mind some plan of proposing cancellation or of connecting uncertainty of situation with the amount or method of payment of indemnities.
  1. L. L. Klotz, French Minister of Finance.
  2. Karl Helfferich, German Secretary of State for the Imperial Treasury, January 1915 to June 1916.