851.5151/969: Telegram

The Chargé in France (Wilson) to the Secretary of State

884. For Secretary of the Treasury from Cochran. At 7:15 this evening in the presence of Baumgartner, Rueff, and Monick, Minister of Finance Auriol handed me for transmission to you the French draft of the proposed text of a joint declaration. There follows my English translation of this document which translation has been approved by Rueff.

[Page 549]

“1. The Governments of the United States of America, of Great Britain, and of France, equally anxious to safeguard peace and liberty and desirous of establishing as quickly as possible the best conditions for the return to international order have decided to make simultaneously the following declaration:

The undersigned Governments affirm their common will to pursue a policy tending to the development of prosperity in the world and to the improvement of the standard of living of all social classes.

They deem that the best means to accomplish this is to put an end to unilateral monetary manipulations which always risk leading to new adjustments and which provoke sudden movements of funds from one market to another detrimental to the equilibrium of national economies. They also desire to lighten and even to suppress progressively the restrictions and restraints of all sorts which paralyze trade and which create an atmosphere of general insecurity and uneasiness involving the gravest dangers to peace.

They are convinced that in order to maintain the maximum of liberty for international trade the maximum of stability must be assured for the principal currencies, the final objective being the complete return to the international gold standard when the conditions necessary are fully realized.

2. With a view to such cooperation toward the economic and monetary peace desired by the nations, the Governments declare that their monetary policy is dominated by the two following principles:

On the one hand, the maintenance, by each country, of the greatest possible stability in its monetary relations with foreign countries.

On the other, careful consideration at all times to the effects of its decisions in this field upon the economy of other countries, common collaboration being necessary to the realization of these principles.

3. Such stability, moreover, cannot be assured unless a lasting compromise among the various economies on the very basis of world prices is previously reestablished.

For this purpose the French Government has decided to proceed to the adjustment of its currency on the basis of these prices. The Governments of the United States and of Great Britain assure it of their close collaboration in order that this decision may constitute the starting point for a confident and constant cooperation among the three countries in the direction indicated by the present declaration and that it may benefit the entire world and peace.

4. With a view to this common action, it is decided that the Treasuries and the banks of issue of the three countries shall consult and unite their efforts to maintain the maximum of stability in international monetary relations, in order to reach the final object which consists of the complete return to the international gold standard.

The three Governments, moreover, shall consult whenever it is necessary in order to maintain or restore monetary stability and shall endeavor to regulate, if necessary by common negotiation, the difficulties which might compromise this stability in case of exceptional circumstances due to the conditions of their internal marked influence or of the general situation.

They declare also that immediate action shall be taken with a view to general resumption of trade and international transactions.

They hope that other nations will collaborate in this policy and thus strive for maintenance and organization of peace.”

[Page 550]

Before handing the document to me the Minister of Finance delivered a really beseeching plea for our acceptance of this declaration and asked me to do what I could to hasten the matter. While it is understood that we or the British may wish to suggest minor amendments, he hopes that they will not involve serious changes in the form or sense of the declaration.

The Minister thinks a joint declaration much better evidence of cooperation and more effective than three simultaneous but somewhat different declarations. He said that a joint declaration over the names of President Roosevelt, Secretary Morgenthau, Premier Baldwin, Chancellor Chamberlain, and Premier Blum would give the world the first real evidence since the war that the three great powers are genuinely cooperating. He thinks a monetary peace on this foundation will be the basis for working toward economic peace and finally achieving political world peace. Other countries should quickly follow to join in this declaration.

The Minister said that he was yielding on two points that the French had urgently desired. He reminded me how dear to a Frenchman is a signed contract but he said he was willing to trust in the loyal cooperation of the Americans and British without insisting upon the more formal arrangement which he had originally proposed.

The other point was in regard to fixed limits for pre-stabilization fluctuations of currencies. The Minister reminded me that France had devalued once since the war and that this operation had not been followed by success of long duration. France has been opposed to a second devaluation fearing illusory results and also fearful lest a whole series of devaluations constituting a downward race might ensue. It is to overcome such objections and fears that the Minister has sought as definite an arrangement as might be found possible.

Although they told me at the Ministry that the Lille strike had been settled this evening, they were all anxious for speed in this matter. They endeavored to prepare a draft which would in a sense give a practical response to the President’s Chautauqua address22 and would embody the main points set forth in the replies of the American and British Treasuries to the original French proposal.

After going over the translation with me Rueff said that the idea would be for France to get the adherence of Switzerland, the Netherlands, and Belgium after the joint declaration may be agreed to by the three major countries.23 He said that the Government’s political [Page 551] advisers thought that Parliament would accept devaluation if clothed in this proposed international arrangement but if it will be published as an isolated and unilateral act devaluation would not be voted.

One draft of the proposed declaration was delivered to the British Treasury in London this evening and another copy handed to Leith-Ross24 who is remaining here until Saturday. If agreement is finally reached our translation should be of course checked with the British. [Cochran.]

  1. Telegram in seven sections.
  2. August 14, 1936; for text, see Department of State, Press Releases, August 22, 1936, p. 163.
  3. For adherences of the three countries under reference to the joint declaration, see Annual Report of the Secretary of the Treasury, 1937, Exhibit 24, p. 259 (Belgium, September 26, 1936); ibid., Exhibit 27, p. 260 (the Netherlands, November 21, 1936); and ibid., Exhibit 28, p. 261 (Switzerland, November 21, 1936).
  4. Sir Frederick Leith-Ross, British Chief Economic Adviser.