The Assistant Chief of the Division of Eastern European Affairs (Packer) to the Special Assistant to the Secretary of State (Bullitt)
Mr. Bullitt: In connection with our conversation of last evening, I am sending you herewith a copy of a memorandum12 which Mr. Kelley prepared last July at Mr. Payer’s13 request, entitled “Problems pertaining to Russian-American Relations which, in the Interest of Friendly Relations between the United States and Russia, should be settled Prior to the Recognition of the Soviet Government.” A copy of this memorandum was handed by Mr. Phillips14 to the President on July 27, 1933.
With respect to the matter of American claims mentioned therein, it is of interest to note that the Department has been urged by committees claiming to represent “a large majority” of the holders of Imperial Russian Government bonds and credit certificates totalling $75,000,000 not to recognize the Soviet régime unless it recognizes its obligations to pay such bonds and credit certificates. A substantially similar position has been taken by what appears to be an independent group of holders of such securities.
With respect to the intergovernmental debt, the attorneys for the National City Bank of New York, with which some of the funds loaned by this Government were deposited, have written the Department in order to urge that recognition, if it is accorded the Soviet régime, have no retroactive effect, so that the financial transactions of Ambassador Bakhmeteff with the Bank might not be invalidated thereby.
Particular attention is invited to the table of American claims against Russia appended to the attached memorandum.
I am not sending a copy of the attached memorandum to the Secretary as I assume you will bring it to his attention.