841.4061 Motion Pictures/189: Telegram

The Secretary of State to the Ambassador in the United Kingdom ( Kennedy )

1232. Your 2023, October 13, 3 p.m. The matter has been discussed with Hays who has expressed gratification with the manner in which you are handling the situation. I am in full accord with the position you have taken with Stanley, and you may be assured of my full support in your continued vigorous representations. You may say to Stanley that we have every confidence that he appreciates the importance of a fair decision which is much more than an exchange [Page 222] question and will actually have numerous ramifications here. It would seem important not to cause adverse repercussions in circles which are now most cooperative with British interests. So far as I can judge, our American companies are quite prepared to go half way in recognizing Britain’s problem, and they are prepared to make sacrifices, but I fully agree in their view that the British should endeavor to understand the potential disaster confronting the American industry.

With reference to your inquiry whether the British could confiscate all American pictures now in the United Kingdom and pay in sterling, I am afraid that they could do this unless British law itself would afford protection to the American interests concerned. It seems advisable to stress policy on this point. I cannot believe the British would go that far. It would certainly be a shortsighted policy because the American companies would surely be forced to cut off future supplies, and the exhibition branch of the industry in Britain would soon be in difficulty.

I agree with your suggestions in respect of fulfilling the quota requirements, although I think the British would do well to abandon this quota set-up. It is bad enough for them to force American companies to produce in the United Kingdom in peacetime. Under present circumstances it is impossible.