462.00R296/2908½: Telegram
The Secretary of State to the Chargé in France (Armour)
[Paraphrase]
Washington, May 19, 1929—8
p.m.
165. Reparation No. 74. We have carefully considered your No. 224, May 18, 3 p.m. You may state to Young for communication to Committee of Experts that the President will make following recommendations to Congress:
- (1)
- That the Government of the United States agree to accept 90 percent of its claims, due September 1, 1929, on account of Army costs, provided Governments of France and Great Britain make similar concession. We will accept annuity sufficient to cover this amount in 37 annual payments; interest on all deferred payments, 5½ percent. Treasury estimates that an annuity of about 32,800,000 gold marks will be required.
- (2)
- That the Government of the United States agree to accept a flat annuity of 40,800,000 gold marks on account of mixed claims which is to be paid annually until our claims as covered in Settlement of War Claims Act of 1928 are completely discharged. This will discharge all private claims under that act in approximately 35 years, as nearly as we can estimate, and the claims of this Government in 17 additional years. You may inform Young, however, that, if proposal of a flat annuity should prove so unacceptable to his colleagues as to lead to breakdown of the conference, we believe Congress would probably be willing to accept figures set down in your No. 224; namely, 2¼ percent of amount available for reparations, which you say would represent an average annuity of 40,800,000 gold marks for 37-year period, and, after 37th year, a flat annuity sufficient to discharge balance of this claim in a 15-year period.
- (3)
- That the Government of the United States agrees to place the Army costs payments in the conditional class; but, in view of its [Page 1076] obligations to its own nationals who are being asked to accept postponement of ultimate payments, it must insist that payments on account of mixed claims be placed in unconditional class.
Stimson