462.00R296/4468c: Telegram
The Acting Secretary of State to the Ambassador in Great Britain (Dawes)
214. For Gibson.2 The German Government is obligated to pay the United States during this year $6,000,000 on account of the Army of Occupation. It is clear that this payment falls clearly within the President’s proposal for postponement.3 The American Debt Agreement seems to fall under a different category. Under this agreement the German Government is obligated to pay to the United States during the fiscal year 1932, on account of awards of the Mixed Claims Commission, approximately $9,700,000, one-half on September 30, 1931 and the other half on March 31, 1932. It appears certain that the War Claims Arbiter will complete his work on account of the claims of German nationals against the United States for ships, patents, and a radio station by September 1, 1931. In this case there becomes immediately available to the German claimants one-half the amount of such awards less the $50,000,000 appropriated in 1928. It has been estimated that the total amount of these awards will approximate $86,000,000, of which there remains $36,000,000 in claims which form the basis of further payments. One-half this sum, or $18,000,000, will be immediately paid to the German nations [nationals], this being almost twice the amount which Germany is called upon to pay to the United States under the German-American Debt Agreement. In addition there is a possibility that if the Mixed Claims Commission sustains its decision [Page 281] in denying Germany’s liability in connection with the sabotage claims, a further sum of approximately $13,000,000 will be available to German nationals. This, of course, depends entirely on the final decision of the Commission.
The Treasury feels that in principle there is no difference between the character of claims covered by the payments received from Germany under the debt agreement and the payments made by the United States to German nationals on account of the awards of the Arbiter. They are both claims of private individuals and it is felt that they do not come within the provisions of the President’s moratorium proposal. In view of the foregoing and the further fact that the amount which the United States in any event will pay to German nationals is far in excess of the amount which the United States will receive on behalf of its nationals under the German debt agreement, it is felt that there should be no objection offered on the part of the creditor governments to the continuation of these two classes of payments.
At the appropriate time you should bring this matter to the attention of the Committee of Experts, with a view to obtaining their consent to the continuance of the payments during the next year on the conditions above outlined.
- Hugh S. Gibson, Ambassador to Belgium, was in London as American observer at the London Conference of Experts, held July 17–August 11, 1931; for correspondence concerning this Conference, see vol. i, pp. 164 ff.↩
- For correspondence concerning President Hoover’s moratorium proposal, see vol. i, pp. 1 ff.; for text of the proposal, see telegram No. 262, June 20, 8 p.m., to the Ambassador in France, ibid., p. 33.↩