467.00 R 29/31: Telegram
The Ambassador in Great Britain (Kellogg) to the Secretary of State
[Received 5:30 p.m.]
442. Your 368, October 21, 6 p.m. and 369, October 21, 7 p.m.63 I had a conference with Sir Eyre Crowe and explained in detail our claims for costs of Army of Occupation and reparations and reasons for our participation in German payments under the Dawes Plan. I said, in view of the attitude of Mr. Snowden at the conference and the statement of Crowe made to me in his note64 that the British Government did not agree with the grounds upon which we based our right to participate, I felt I should have an informal and frank discussion of the whole subject with the Foreign Office. He said he was glad to discuss the matter with me. I think he understood our position perfectly.
He said however he understood there were some legal objections that the Treasury had raised; that under the Versailles Treaty the reparations of the Allied and Associated Powers were made a prior charge on Germany; that the Reparation Commission was the sole body empowered to receive reparations; that the Reparation Commission had notified Germany of the total amount of their claims but did not include ours as we did not ratify the treaty or come into the adjustment and that therefore technically we could not make a separate treaty and make our claims preferred claims over those of the Allies or pari passu with them.
I said I did not think his position well taken. In the first place the United States Government as a participant in the war was entitled on equitable grounds to reparations. In the second place if the Allied Governments agreed to present participation Germany could not object. He said of course this was true and if the Governments agreed it could be adjusted. In the third place I told him that Germany and a part of the Allied and Associated Governments could not agree between themselves that their claims should be a prior charge on the revenues of Germany as against the claims of the United States. He did not claim this objection applied to our Army costs as that was provided for by the Armistice Agreement but he thought the whole matter of our claims was a subject for an agreement as there had been an agreement of the Army costs. He did not commit his Government as to what adjustment they would make but said he would talk the matter over with his Treasury and [Page 69] discuss it further with me. He supposed the experts at Paris would not settle it. It would be settled by the several Governments. He further said that he understood there was a further question about the ships taken from Germany. They were divided among Allies in a certain proportion according to their losses and all ships over a certain amount were paid for by the several Governments to the Reparations Commission; that the United States had not come into this adjustment. He said he was not at all clear about this point. What is your understanding as to this?
In the course of the conversation I mentioned the subject of the Turkish gold, explained the situation and said in that case the Allied Governments had asked our consent for the disposition of the gold to the Allies, thus they had conceded our interest. I did not make this a quid pro quo for the adjustment of our reparations claims but told him I could see no reason why we should consent to turn over this property to the Allied Governments if we were not permitted to participate in the German payments. He did not comment upon this but I think he grasped the point.
On the question of the Mesopotamian mandates he was not posted but said there was no intention of discriminating against American interests nor that monopolies should be granted. He was inclined to think the resolution referred to in your number 369 (which I did not show him) took the place of the original mandate. Article 11 of the treaty of alliance contains a clause against discrimination. He promised to give me full information on this subject.
Will write Logan and keep him fully advised.