Memorandum by the Assistant Secretary of State (Rogers)
The German Ambassador47 brought in the attached memorandum regarding the coal import excise.
He said orally that if the position they expressed was not accepted by this Government, they would feel free to proceed with their own domestic legislation in a way now forbidden by the treaty in view of the fact that they considered the levying of the coal tariff against them a breach of Article 7. He said their shipments of coal were very small, that one shipment had recently landed and another was on the way, and that he assumed that the question of law would be promptly taken up by the American importers and tried in the courts.
I told the Ambassador we had not informed him of the Attorney General’s ruling48 as we knew they had learned of it from the newspapers and we had not planned to write until the action of the Treasury had been announced pursuant to the Attorney General’s ruling. We did not yet know what the action of the Treasury was but assumed it would in some form reinstate the prior ruling admitting German coal free of the tax. I explained that the Attorney General’s ruling did not reach the [Page 505]merits of the case but was merely procedural. I said that we and the Treasury had both taken the position that on the merits German coal was to be admitted but this now was taken out of our hands entirely and must be left to the courts. He asked again if we would respond to his memorandum and I promised to do so as soon as we knew the Treasury ruling but not necessarily before.
The Ambassador talked generally about conditions in Germany saying they were politically quieter for the time being, that the next issue would be when the Reichstag assembled, and that the continuance of the Government depended on the Nazi vote. If they abstained, a vote of non-confidence could not be passed. He said economically there was some improvement in Germany and he understood in Great Britain. In Germany it was chiefly in heavy industries. The von Schleicher Government was talking very little, busying itself with meeting the domestic unemployment problem, and confidence was rising as the previous constant machine gun fire of political discussion was superseded by a calmer governmental movement. He said the equality claims in the Disarmament Conference remained a critical element in German domestic politics.