462.00 R 29/2396½

Memorandum by the Secretary of State of a Conversation with the British Ambassador (Geddes), January 25, 1923

The Ambassador said that he had called, on behalf of his Government, to ascertain what the Secretary thought with regard to the situation in the Ruhr. The Ambassador referred to the matter as very serious and saying that he had been asked to report as to the state of American opinion, which he thought he clearly understood, but that he would be very glad to have the Secretary state his own impressions, and, if he saw fit, the position of the United States Government.

The Secretary said that opinion in the United States was divided; that there was a considerable body of opinion to the effect that France had been devastated, that she had not been able to recover from Germany the reparations to which she was justly entitled, and that finally she felt compelled to go in and see what she could get for herself, and it was hoped that she would succeed; that those who held this view were quite influential and that this was an important body of opinion. Another view largely held was that of those who looked at the matter from the standpoint of Germany and felt that the action taken by France would make impossible the recuperation of Germany and thus defeat the ostensible object of getting reparations and would lead to economic disaster. Those that took the latter view were demanding some action to stop the French.

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The Secretary said that there were other groups who did not hold either the extreme pro-French or an extreme pro-German view, but were divided with regard to certain principles of action. One group wished this Government to “go in,” as the expression is, that is, to be more intimately related to the European affairs; and the other group demanding that the Government “stay out” and have nothing to do with them. The Secretary said that there were still others who did not take either a pro-French or a pro-German view and were not obsessed with any idea of either going in or staying out but were taking a view of the matter in its relation to the economic rehabilitation of Europe and to the maintenance of peace and the establishment of a basis upon which the nations concerned could have a fair degree of prosperity and stability. The Secretary said that these were much concerned not only with the direct consequences of the action of the French, but with the indirect consequences to which so many were oblivious;—for example, quite apart from the immediate and direct results of the occupation of the Ruhr was the strangulation of German credit. Thus, not only were German industries incommoded at the time for want of coal but no one throughout the world was placing any orders with Germany that it could place elsewhere. This was due to a fear of the prospects of German industry and the absence of German credit and the consequence was that there would be a speedy and extensive impairment of Germany’s capacity to export, upon which the payment of reparations ultimately depends. The Secretary also referred to the fact that Italy was largely dependent upon German coal and so was Switzerland, and that the consequences therefore were very serious with respect to a large part of Europe outside of Germany. The Secretary said that the real question was what could be done which would be really helpful. It was easy to do things but not at all easy to suggest any course which promised any result. The Secretary asked what the British Government thought of the matter.

The Ambassador said that the opinion in England was divided just as it was here; that through the southern part of England there was a very pronounced feeling in favor of the French; that this was true also in the Highlands; that through the Midland counties, especially among the labor people, there was a very decided anti-French opinion; that this division of sentiment made it very difficult for the Government and that they were going to have a serious time. The Ambassador referred to what the Secretary had said about German credit and asked if we had definite corroboration of the fact that Germany was losing orders for industrial products. The Ambassador said that they had noticed the transfer of orders [Page 54] to England and he wondered whether the same was true here. The Secretary said that he did not have specific instances but he had understood that this was the case to some extent. The Ambassador said that the British might have some temporary advantage but it would be very temporary, and, of course, their great interest was the re-establishment of sound economic conditions.

The Secretary asked the Ambassador what his Government thought could be done. The Ambassador said that he did not see what they could do. The Secretary asked whether they had made any protest to the French against the occupation of the Ruhr. The Ambassador said they had not. The Secretary said that he had been informed that Italy had made some effort but had not succeeded, and asked whether the Ambassador was informed as to exactly what had taken place. The Ambassador said that he understood that Italy had made some request, but that there was nothing that his Government could do about it.

The Secretary said that he had understood that the Italian Government had been assured by France that the object was merely to have a civic supervision and that the Italians were very much surprised at the extent of the military movement; that it had been understood that there would be only a few guards necessary to protect the civil representatives in establishing some sort of supervision over payments and deliveries or in taking guarantees, whatever that might mean. The Ambassador said that the British Government had felt at the time of the Paris Conference on January 2nd, and later, that the French were contemplating a military movement. The Secretary said he understood that but he was asking to what extent the French had informed the British Government as to their proposed action. The Secretary said that so far as the American Government was concerned, the inquiry just preceding the actual invasion made no suggestion of any extensive military movement. The Ambassador said that he was quite sure that the French had made the same professions to the British Government, and he agreed with the Secretary that there had been no announcement of the French plan until the French made their statement to Germany on the eve of the movement of their troops.

The Secretary said that the developments were exactly what he had anticipated; that one step required another to justify it, and that it was impossible for a retreat to be made, and that each action of German resistance would be followed by an extension of French operations.

The Secretary asked again whether the British Ambassador thought that the French were in a mood to receive any suggestion. The Ambassador said that he did not think so. The Secretary said [Page 55] that he had felt that there was a growing tenseness on both sides; that the war spirit was reviving; that the French on the one hand were determined to prosecute their undertaking, and that, on the other hand, whatever disposition may have been left among the Germans to make an endeavor to pay was rapidly departing, and now the Germans themselves would be unwilling to have negotiations undertaken which would leave to the French an advantage by reason of their invasion and would insist that nothing should be done until the French had withdrawn. Thus there appeared to be a contest in which neither party was willing to yield.

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The Secretary said that of course the United States Government took the deepest interest in the situation and desired to see some final solution that would be adequate but that he did not feel that at this moment either France or Germany would lend a willing ear to any suggestion; that it was not worth while to do anything unless there was a reasonable prospect of success, and that there could not be a prospect of success unless France was willing to give assent. The Secretary said that any suggestion that might be made would have to be one that was cordially welcomed by France or else one which was of such obvious propriety and merit that it would compel approval. The Secretary said he did not know at this time of any such suggestion that could be made, and asked whether the Ambassador did. The Ambassador said that he felt the same way in the matter and he thought his Government did.

The Secretary said that the developments would be closely examined and the day might come when there would be a better prospect.

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