611.4131/1698: Telegram
The Ambassador in the United Kingdom (Kennedy) to the Secretary of State
[Received July 26—2:08 p.m.]
678. Department’s 387, July 25, 6 p.m. I saw Oliver Stanley this morning and I have just lunched with the Prime Minister.
I am quite convinced that the Prime Minister is definitely moved by your argument on the broad aspect of the trade agreement and the matter is being taken up at the Cabinet meeting on Wednesday night or Thursday, at which time Stanley will be given authority to close the deal and certain concessions will be made on the subject under dispute.
I am sure there is very little prospect of anything being done on lumber, in line with his memorandum which he says was presented to you personally by Ronald Lindsay, which he feels is an answer that will satisfy you. With reference to tobacco, no concession can be made before 1942 but it may be possible to make some kind of statement that will give us some hope and will prevent other countries from extra planting.
On all the other subjects I think there will be some concessions. Whether they will be satisfactory to you I do not know. I am convinced that Chamberlain will tell the Cabinet he agrees with your policy and they must make a deal if it is humanly possible. I stressed the point that it is not going to do anybody any good to appear to have driven a smart bargain. I therefore think they will honestly make what in their opinion at least are all the concessions they can make. So when it is it [sic] should go forward to you the end of the week.
[Page 45]I think the talks have done a great deal of good and I think Chamberlain had a discussion with Stanley last night on the whole subject and urged him to do everything possible. Now, what he thinks possible and what we think possible is of course liable to be very different.
Stanley will get formal approval of the Cabinet, if an agreement can be reached, to sign it without calling the Cabinet together. The Prime Minister is leaving this week for Scotland in an out-of-the-way place and does not expect to come back until September unless some international situation comes up. Stanley on the other hand will come back whenever it is necessary.
With your approval I am hoping to go away about Tuesday or Wednesday of next week to join my family in Cannes. I have arranged to be able to fly back in 5 hours if situation arises that makes it necessary for me to be in London.
Chamberlain will make statement in Parliament this afternoon saying in substance the agreement is still being negotiated and that he is hopeful that it will be signed.
Anything else I can do?