The Consul General at Berlin (Jenkins) to the Secretary of State

No. 1491

Sir: I have the honor to report the statement of Reichsbank Direktor Rudolf Brinkmann made to Vice Consul Fox to the effect that the German Government is not now in a position equitably to negotiate a trade agreement with the United States.

The German Government, of course, would welcome an agreement very favorable to them at this time, but in the opinion of Reichsbank Direktor Brinkmann, who, it may be briefly recalled, is a close collaborator of Dr. Schacht’s and one of the three general advisers in the Ministry of Economics, a fair agreement could not yet be entered [Page 330] into between the Government of the United States and the Government of the Reich.

Direktor Brinkmann admitted his recognition of the fact that the United States is not merely desirous of exporting cotton alone to the Reich, as under present conditions. In the informal conversation that ensued between Herr Brinkmann and the drafter of this despatch,23 it was pointed out that the United States, even when solely considering the agricultural point of view, had other interests besides cotton; grains, pork products, and fruits were also items which America would profitably like to deliver to German markets.

Herr Brinkmann agreed on these desires in principle, and said in fact that he was at present working with the agricultural authorities to see if some way could not be found to admit such goods from the United States. He claimed that the recent mal-prognostications of the German Government with regard to the food supply* had weakened the formerly strong position of Argentine born Minister of Agriculture Darre, and had strengthened the hand of those who wished to regularize, in the long run, Germany’s imports of foodstuffs. In this connection, he stated that not too much faith should be placed in the plans of General Goering substantially to increase Germany’s home grown food supply.

The chief cause for the Government’s inability to enter into a trade agreement was the weakness of the German economic position. Reichsbank Direktor Brinkmann affirmed that with the recent amnesty and with other hidden means, the present shortage of grains and foodstuffs could be made good through special imports. This, however, was but a temporary matter and in his opinion, which he claimed was that of other high officials of the Ministry of Economics including Dr. Schacht, the real German crisis would not be reached until the latter part of 1938 (in the absence, of course, of any unforeseen “break”). It was therefore not feasible for the Government to undertake commitments towards the United States in the present state of flux.

Direktor Brinkmann preferred to take the long range point of view when considering trade with the United States. He therefore asserted that the chief aim at present of the German Government should be not to lose contact with officials of the United States. To be sure, stopgaps such as the present cotton barter (which he hoped to expand [Page 331] slowly to include other products) could be discussed and carried on. But it was chiefly essential to maintain governmental contact so that when the position of Germany did resolve itself, more comprehensive matters could be gone into, and a treaty negotiated that would really restore trade on a large scale.

It was with this in mind that he hoped to make a trip to the United States in the fall months of 1937, not basically to negotiate, but rather to keep acquainted with American officials and American conditions. He added that he hoped by this time to have reached some agreement with the Reich Nutrition authorities so that a beginning would have been made toward a program for the import into Germany of fruits and pork products.

In this connection it may be of interest to note that Reichsbank Direktor Dr. Blessing, holding a position in the Government analogous to that of Reichsbank Direktor Brinkmann, recently informed Vice Consul Fox that his views on the trade situation between the two countries were substantially still those which he privately outlined in a former conversation with Mr. Darlington24 of the State Department on the latter’s last trip to Berlin, and that he would be ready at all times to accept a treaty on the basis informally discussed at that time. This is interesting in view of Herr Brinkmann’s statement regarding the ability of the government of the Reich to enter into a fair and worthwhile treaty that would restore trade, from a long range point of view.

Very respectfully yours,

Douglas Jenkins
  1. Vice Consul Hugh C. Fox.
  2. See, for instance, the Consulate General’s report No. 774 of March 9, 1937, entitled Admixture of Corn Meal in Wheat Flour Made Obligatory in Germany as a Measure Against Scarcity. [Footnote in the original; report not printed.]
  3. See the Consulate General’s report No. 794 of April 6, 1937, entitled Announcement of Important Measures Intensifying the Drive To Increase Agricultural Production Under the “Four Year Plan” In Germany. [Footnote In the original; report not printed.]
  4. Charles F. Darlington, Jr., economic analyst in the Division of Trade Agreements.