800.51W89 Great Britain/365

Memorandum by the Secretary of State of a Conversation With the British Ambassador (Lindsay), December 11, 1932

Yesterday afternoon, shortly after two o’clock, the British Ambassador came to Woodley. As he entered the room he said he was bringing in his pouch 95 million dollars in gold. He then produced a note, which is attached hereto.7 I read the note carefully, and at once noticed the statements in paragraphs 5 and 6 and questioned the Ambassador in regard to his Government’s purpose in making those statements, particularly the statement that they proposed to treat the payment as a capital payment of which account should be taken in any final settlement. I pointed out to the Ambassador that the Secretary of the Treasury, being a ministerial officer, would have no power to accept the payment except as a payment made under [Page 776]the debt agreement of 1923;8 that he had no power to vary it either by expression or implication; and I told the Ambassador I foresaw that there were likely to be very acrimonious debate and public statements in the United States as a result of this note. The Ambassador said that his Government had resolved to ask for no favors. He pointed out they could not give us notice in very explicit terms that they were not going to make any further payments in June without adversely affecting their credit now just as if they had defaulted. He also told me that this note was probably now in the hands of the British press because he had heard that his Government intended to give it to the press that afternoon by London time and that time had now arrived. I pointed out that this provoked a rather critical situation in which there was no time to discuss with his Government the dangers which I had pointed out. He replied that there was some constraining pressure upon his own Government to make this note public on account of the French, the nature of which constraint he did not fully understand. In my talk with him I had gone over the situation in very careful and meticulous detail, in an attempt to show him how impossible it was for the Secretary of the Treasury to accept a conditional payment, or himself to make any binding agreement as to future payments for our Government.

I also took this occasion to see whether the British Ambassador fully understood that we were willing to waive the notice on the principal payment of 30 million dollars. I explained to him that at one time we had had a little question as to whether we could do that without going to Congress, and we had decided we could do it. He said he fully understood that and had so reported to his Government.

H[enry] L. S[timson]
  1. Infra.
  2. Combined Annual Reports of the World War Foreign Debt Commission, 1922–1926, pp. 106–111.