462.00R296/4045: Telegram

The Ambassador in France (Edge) to the Secretary of State

[Paraphrase]

334. Reference to your No. 262 of June 20, 8 p.m.52 I saw Berthelot at the Foreign Office this morning and in the absence of Briand presented him with the official text of the President’s statement. The substance of Claudel’s communications was given to me by Berthelot, particularly the draft for the French reply to the President’s statement. The Cabinet Council will consider this tomorrow. The important point of it is that the French Government agrees to the principle of according a delay in debt payments and is anxious as soon as possible to work out the details. The French would in all probability, Berthelot indicated, make a reservation on the subject of the unconditional reparations payments. In response to my statement that I was sure that my Government had no such differentiation in mind he said that for psychological reasons France did not feel that she could give up these payments, which might be very difficult to have resumed and the remission of which would meet with tremendous opposition in the French Parliament. Berthelot said that while the payments as such should continue there might be some arrangement for balancing them so that although France would not get the benefit of them she would nevertheless receive the payments. He said when closely questioned that he did not know what the method could be by which such an offset might be brought about. He refused to commit himself on either the possibility of a credit or of a loan.

Berthelot said that the French fully realized that they had been kept absolutely an courant and that, with reference to the reaction in the French press this morning, the statement that the French [Page 48] Government had not been properly informed was complete nonsense. While a visit from Mr. Mellon to Paris would not be needed from the point of view of the French Government it might be useful for the effect it would have in the press. Berthelot realized that Mr. Mellon had not come to England to negotiate on this subject but had taken advantage of the opportunity to talk over the matter. The French have had, according to Berthelot, a very quick calculation made of the relative importance of the debt situation which showed that the sacrifice of the United States would be at least double that of France; that the French sacrifice would be second; that of England approximately one-tenth that of France; Belgium’s slightly more than England’s; and Italy’s about the same. The sacrifice of the United States according to this calculation would be about 6% of its budget. It would be 4% of the French budget and a very inconsiderable portion of the British budget. Public opinion in France, he felt, would surely question why so great a sacrifice should be imposed on France in comparison with her neighbors, and some adjustment on this point might be demanded by them.

No compensation with respect to its sacrifice, I pointed out, had been asked for by the United States. I also pointed out that the question came down to whether the countries of the world would not be willing to make a temporary sacrifice for one year in order to improve the world financial situation, thus making payments more probable next year and thus producing better results.

The French Government, Berthelot said, fully understood this point of view and realized that some international action had become absolutely necessary because of the withdrawals of gold from the Reichsbank. This action was necessary in the interests of Germany and through Germany to the financial establishments of the world.

It was suggested at the conclusion of the conversation that Briand might desire to see me upon his return late this afternoon. In reply to my question as to whether there was anyone else I could usefully see it was suggested that I see Prime Minister Laval. Laval is returning to town tomorrow morning for the meeting of the Cabinet. As soon as possible tomorrow I shall endeavor to see him.

Edge
  1. Ante, p. 33.