871.51/777
The Minister in Rumania (Culbertson) to the Secretary of State
[Received February 24.]
Sir: I have the honor to report concerning the status of Rumanian pre-war bonds, for example, the bonds held by Dulcie Hoffman-Steinhardt and several other American claimants.
Sometime ago I talked with Mr. Titulesco, Minister for Foreign Affairs, concerning the Rumanian Government’s policy towards these bonds. He said that he would settle the few American cases immediately if he were sure that the successful claimants would not talk! This statement sums up the problem which confronts the Rumanian Government with reference to these pre-war issues. If the relatively few American claims are paid, a precedent would be established under which thousands of claimants, Rumanian and foreign, will demand payment on a like basis, and whatever the theoretical justice of these claims may be, the practical result which confronts the Rumanian Government is this: to attempt to pay the service in gold of these pre-war issues at once would mean the financial ruin of the government. I feel sure that the reason for not paying the American claims is not a disrespect for our urgent representations, but an unwillingness to commit financial suicide.
I, however, have continued to press for a satisfactory reply from the Rumanian Government in the cases of pre-war bonds held by American citizens. A few days ago Mr. Victor Badulesco, Secretary General of the Ministry of Finance, stated to me that it is the intention of the Rumanian Government to pay all of the pre-war bond issues and [Page 816] that some plan of paying off these issues gradually is now being developed. It was evident from the figures which he produced that it is financially impossible for the Rumanian Government to meet the entire service of these issues immediately, but now that it is seeking a loan abroad it is confronted with the necessity of reaching some settlement with these pre-war bond holders.
It would seem, therefore, that in time the Rumanian Government will offer some sort of a settlement with respect to the pre-war bonds held by American citizens, but only in connection with a general settlement.
I have [etc.]