611.6231/388
Memorandum by the Assistant Economic Adviser (Livesey)
Dr. Meyer26 brought in the Associated Press despatch in the Washington Evening Star of August 1, purporting to report the disclosure by an authoritative source that political and economic questions have eliminated Great Britain, Germany, Soviet Russia, Canada, Argentina and Austria from immediate consideration in negotiations for new reciprocal trade agreements.
The paragraph dealing with Germany is as follows:
“Germany—Despite the fact Dr. Hans Luther, German Ambassador, has made several overtures to the State Department, officials here believe the unsettled political and economic situation in Germany is not conducive to successful negotiations with the Hitler government at the present time.”
Dr. Meyer said that this press despatch would greatly disturb Berlin. If it had not been for the death of President Von Hindenburg, and the visit of the Secretary of State to the Embassy in connection therewith, Dr. Leitner27 would have taken the matter up directly with the Secretary to be able to inform Berlin. The Embassy here has been dissuading the Foreign Office from impatience regarding reciprocity negotiations. If Berlin concluded that no negotiations could be had for a considerable time, the German Government might take decisions on its debt and economic policy on that basis.
After pointing out that it was inconceivable that the statements in the article could have any official basis, I obtained from Mr. Hickerson28 a statement of fact that the article was merely a speculative concoction of the reporter. I then introduced Dr. Meyer to Mr. Grady.29
Mr. Grady repeated the denial and said that the Embassy knew the Secretary of State’s position with reference to negotiations with Germany. The Secretary evidently attached great importance to questions of principle such as non-discrimination in respect of trade and of debts. Mr. Grady had not discussed with the Secretary the definitive determination as to countries for negotiation but had touched on the matter in discussion with him. Many questions had to be considered in determining the program, there was an immense amount of work to be done, but it was hoped soon to determine the possibilities of negotiation with countries and to announce countries.
[Page 435]Dr. Meyer went into a considerable disquisition on the German position, stating that preferential bilateral agreements were clearly not in the interest of Germany, but that it was forced to conform to the policy of other countries. It could not sacrifice its trade with Great Britain, France, the Netherlands, and Switzerland. All its creditors had been willing to negotiate except the United States, which had been offered an equal opportunity to negotiate.
Dr. Meyer mentioned that it was important to reach some conclusions by October 1, which is the date for taking some decision as to the continuation of the commercial treaty between the two countries. Mr. Grady said he hoped to have an opportunity to discuss the country program soon with the Secretary of State but he did not know when this would be.