The Minister in Czechoslovakia ( Ratshesky ) to the Acting Secretary of State
[Received July 17.]
Sir: I have the honor to refer to my telegram No. 25 of June 27, 12 noon regarding the attitude of the Czechoslovak Government to President Hoover’s proposal for a postponement of payments for one year on inter-governmental war debts and reparations and to report that the Government has not yet made any official statement in regard to the matter. In my conversation with Dr. Beneš he made it clear that he did not wish to take any precipitate action which might embarrass the allies of Czechoslovakia though he, and it is presumed the Government, heartily approves of the plan. At that time it was evident that he expected the negotiations between France and the United States1 to be terminated very quickly. Now that there has been delay and an apparent inability to reach an immediate agreement as to the method of the execution of the proposal I believe that he will withhold his formal acceptance until France has signified her acceptance. As this country has everything to gain and nothing to lose by the postponement it is obvious that it will accept but it is also evident that the proposal will be accepted on the terms agreeable to Czechoslovakia’s most important ally, France. This attitude is entirely comprehensible as France must bear the largest burden of the postponement and she can at least expect her allies who are not affected to accept on her terms. I do not believe that the French Government has requested Czechoslovakia to withhold her answer but that this policy arises out of Dr. Beneš’ conception of obligations to a friendly country.[Page 202]
President Hoover’s proposal caused great surprise here by its unexpectedness although there had been much speculation in the press ever since the visit of the German ministers to England as to what attitude the United States would take towards the pressing problem of debt payments. It was generally considered that no change would be made in our policy previously announced. The proposal was greeted with general approval particularly in financial circles, though it was stated at once that France and Belgium would probably object. There also seemed some doubt as to how the proposal would affect Czechoslovakia and consequently the Government’s attitude was reserved pending developments. Since that time the French viewpoint has been reflected in the press with sympathetic consideration. I have not pressed the matter and what Dr. Beneš told me was entirely voluntary. I am certain, however, that no official statement can be expected until there is complete agreement between France and the United States.