800.51W89 U.S.S.R./23: Telegram
The Secretary of State to the Ambassador in the Soviet Union (Bullitt)
15. Your 20, March 18, 6 p.m. Johnson bill has passed Senate and will probably pass House April 2d.7 It prohibits the purchase or sale in the United States of obligations hereafter issued by any Government in debt default to our Government except in connection with the Export-Import Bank credit transactions. But by resolution of the Bank there can be no such transactions with the Soviet Union until debt agreement acceptable to the President is concluded. It follows that enactment of Johnson bill coupled with failure to reach agreement would prevent the Soviet Government and its agent Amtorg8 from making any purchases in the United States otherwise than for cash certainly where the sellers expect to dispose of the obligations. This stresses the importance of both countries speeding agreement relative to debts. Prior to enactment of Johnson bill existing situation with regard to ordinary commercial credits unchanged.