462.00R296/4015a: Telegram

The Secretary of State to the Ambassador in Germany (Sackett)


81. The views of Congressmen are being sounded out by the President with a view to sending a proposal to the different countries in Europe. This would suspend all obligations and claims between governments for 12 months and would embrace all except private debts and all annuities arising out of reparations. The President is hopeful that, by so taking the initiative, he will grant time to hard-pressed debtors and also alter the distrustful and panicky feeling on account of which the German gold reserves have been undergoing withdrawal and repercussions are threatened in Central Europe as well as disaster in Germany. As the most effective means of helping Germany and other countries and as the most practicable appeal to public opinion in this country, the decision has been made in favor of this suggestion. Remarkable success has already attended the President’s efforts to secure the support of Congressmen; but, if he could have in his possession and ready to be published when necessary, a statement of what the German situation actually is and what its dangers are to Germany and the rest of the world—a statement that would come from the highest official source possible, it would assist him in strengthening the support which he has already and in securing further support. Proof that the situation is urgent is required, something along the lines of a moratorium declaration under the Young Plan but without involving the technical results and dangers that would follow such a moratorium. The average American has no tangible evidence at the present time of such a critical situation, and he is inclined to think that the bankers, for their own purposes, have raised a mere scare.

Nearest to what we have in mind would be a statement sent to President Hoover by President von Hindenburg which would indicate that the present situation in Germany is grave for the whole world as well as for Germany. This statement could well point out the present economic difficulties of the German people and also the sacrifices already made by them; and it might indicate the psychological and material advantages that would accrue to them if the discharge of their obligations could be somewhat deferred. The statement might express a hope for the rehabilitation of the people of Germany if this aid were granted them. It might also indicate faith in the German people.

Please discuss this question at once with the German Government.

[Page 33]

Such a statement should be in our hands by tomorrow, as the President will probably have to act by that time. This will confirm the message I sent over the telephone.38 The President feels very strongly, and asks me to inform you of his feeling, that, rattier than coming from any other source, such a statement should come from President von Hindenburg personally in order that it may have the effect which is desired.

  1. No record of this telephone conversation found in Department files; see the Ambassador’s telegram No. 86, June 20, 11 p.m., p. 35; also his despatch No. 990, June 24, p. 39.