462.00R296/4795: Telegram
The Ambassador in Great Britain (Dawes) to the Acting Secretary of State
[Received 8:25 p.m.]
291. My 289, August 3, 11 a.m.7 Following is the text of an undated and unsigned statement sent the Committee August 1st when delegations refused to take any action on an oral statement. The Secretariat circulated it as “memorandum by the American Delegation”. On first presentation of the matter it had been especially decided to treat it as strictly confidential so far as the Committee was concerned.
“London Committee of Experts 1931.
Memorandum by the American Delegation. The German-American Agreement of June 23, 1930.
- 1.
- The Agreement of June 23rd, 1930, provides for the payment by Germany of 12,650,000 marks on September 30th, 1931, and of the same amount on March 31st, 1932, on account of the costs of the United States Army of Occupation. The Government of the United States contemplates that these payments be postponed on the terms of repayment to be established by American legislation for putting into effect the President’s proposal of June 20th, 1931.
- 2.
- The Agreement also provides for payment of 20,400,000 reichsmarks on September 30th, 1931, and of the same amount on March 31st, 1932, a total of 40,800,000 reichsmarks which are payable in satisfaction of the awards of the German-American Mixed Claims Commission. These payments are affected by special conditions which make it desirable in the interest of the general situation that they be not postponed and the Government of the United States proposes that they be not postponed. The payments are deposited, together with sums appropriated from the United States budget and other funds of the United States Treasury, in a special deposit account for disbursal to German and American nationals pursuant to categories of priorities established by the United States Settlement of War Claims Act.8 The surpluses which would become payable to the German economy from this fund in the year beginning July 1, 1931, are nearly twice the sum of 40,800,000 reichsmarks payable by Germany into the fund during the same year.
In connection with the German exchange crisis the Government of the United States has examined into the possibility of making payments from this fund immediately available to the German economy and has assured itself that it would be technically possible to mobilize immediately in the most effective manner such a payment in the amount of about $18,000,000 while there is a contingent possibility that an additional sum of approximately $13,000,000 may within a few months become available.
[Page 283]The budget of the United States receives no benefits from the 40,800,000 reichsmarks payable by Germany in the year beginning July 1, 1931, which are disbursed to private individuals in payment of the awards of an international tribunal. A minor fact of practical importance incident to these awards is that they bear interest at the rate of 5 percent in favor of the individual claimants and that postponement of receipts of the deposit fund would result in the accrual of interest changes [charges] in favor of American nationals having priority over later payments to be made to German nationals under the priorities established by the pertinent legislation.
For these reasons of a practical nature substantially promoting the economic purpose of the President’s proposal of June 20, the Government of the United States regards it as obviously undesirable that the movement of these payments be interrupted. However, before expediting the payment of $18,000,000 from its own resources to German nationals for the benefit of the German economy the Government of the United States desires to bring the foregoing statement of facts to the attention of the experts now meeting in London assuming that they will agree that these and the corresponding German payments should be continued.”
From Livesey.9