852.75 National Telephone Co./257: Telegram

The Chargé in Spain (Matthews) to the Secretary of State

55. My telegram No. 47, May 11 and Department’s telegram No. 11, May 16, 6 p.m. At his request I called on Under Secretary Barcenas on Wednesday en route to Madrid. He said that he had not answered [Page 825] my letter concerning Colonel Behn because of the reference therein to his confidential statement to me that the question of his entry into Spain was to come before a Cabinet meeting. (He confirmed that it had been discussed therein.) Inasmuch as this statement had been made personally and off the record he did not feel that he could make a reply in writing. He went on to say in friendly fashion that he personally would do all he could to facilitate the entry into Spain of Colonel Behn and hoped for support in this from Ambassador Cardenas on his early return here on a visit. For the present however he could only strongly counsel patience on the part of Colonel Behn and urge the company to cease its efforts through many sources to force the issue. He emphasized the feelings in some quarters (he was not specific) that while Colonel Behn had visited Republican Spain several times during the war he had never once come near the Nationalist side; that if he had waited this long to get in touch with this Government there would seem to be no reason for urgency in his coming to Spain now. Barcenas then referred to the newly authorized visa procedure (my telegram No. 53, May 16, noon4) and read me extracts from confidential instructions to Spanish consulates to refuse visas to “officials, executives and technicians” of companies with interests in Spain which during the war had cooperated with the Republican Government “particularly if these executives and technicians had made no effort to get in touch with or cooperate with” the Nationalist Government. Barcenas said that in spite of these instructions Colonel Behn might of course inadvertently be granted a visa and be permitted to enter Spain; that in such case the situation “might become embarrassing” and he felt that Colonel Behn would in any case wish to enter Spain “by the front door”.

I pointed out that Behn as president of a concern with very important investments in Spain was naturally desirous of giving these his personal attention and that if permitted to come in he could presumably satisfactorily explain the position which his company had taken during the war. Barcenas replied that the company was well represented here by Mr. Caldwell and others of its American staff who could deal with such questions as might arise and reiterated the un-wisdom of pressing the matter now. I inquired whether some other high official of the company would be permitted to enter Spain in the interim (Colonel Behn had mentioned to me the possibility of sending Mr. Stockton if it appeared that the existent animosity was against him rather than against the company) and Barcenas advised that no such request should be made.

I asked what in addition to what he had told me really lay behind Colonel Behn’s exclusion. He said “Frankly I do not know. If I did I would tell you.”

[Page 826]

I am still convinced that the motives behind and sources of the opposition to Colonel Behn’s admittance are as set forth in my telegram 47 (Barcenas would not admit—he may not know that any plans of Government policy vis-à-vis the company are in progress). Whatever the propriety and legality of the International Telephone and Telegraph Company’s position in Spain during the war the fact remains that there is much bitterness against them here for their cooperation with the Republican Government and their failure to do more to help the “cause of Nationalist Spain”. I believe that the full force of this bitterness is not yet fully realized by Colonel Behn or his officials here. Caldwell has now for the first time learned from Mestre, present head of the Telefonica under Government administration, that during the latter’s conversation with General Franco several weeks ago in which he claimed to have pleaded for Behn’s entry the General replied “it cannot be permitted” and himself added that during continuation of “the state of war” the Telephone Company must remain in the hands of the Government. I also learned that a fortnight ago from two separate sources, namely General Jordana as Vice President of the Council of Ministers and the Minister of Finance, the Government asked the company for copies of the contracts between the Compania Telefonica Nacional de Espana and the International Telephone and Telegraph Company de Espana as well as those between the former and the Government. The company has confirmation that these are being carefully studied. Furthermore by a law published on May 12 through appointive powers on the boards of directors of three Spanish privately owned railways the Government has assumed control thereof pending preparation of “a permanent statute”.

While those railways have owed the Government large sums of money since the 1920’s and their case is not therefore parallel to that of the International Telephone and Telegraph Company, this action might well be considered a straw in the wind indicating the trend of future governmental policy with respect to public service corporations. (I wish respectfully to refer to the last sentence of the penultimate paragraph of my telegram No. 47.)

There is a question in my mind (and apparently Caldwell is beginning to feel somewhat the same way) whether unless the Department wishes to make a serious issue of this question it would not better serve the company’s interests as well as our own to exercise considerable patience as suggested by Barcenas on the logical wisdom of Behn’s entry into Spain. I believe that it would certainly be advisable for the company to cease its “pressure activities” on various fronts and I am so informing both Behn and Caldwell.

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In specific reply to the second paragraph of the Department’s telegram No. 11, with the exception of Colonel Behn I believe Americans of the Telephone Company are receiving and will continue to receive the same treatment accorded others as regards entry into the country. (As previously reported they are permitted to take no part in the company’s administration during continuance of “the state of war”.) I believe that the difficulties and delays in obtaining permission to enter Spain previously reported have continued with respect to all nationalities; the action taken by other governments on behalf of their nationals has been similar to that which I have followed, though the French went so far as to threaten at one time to exclude all Spaniards from France and the British to impose rigid visa requirements if the situation was not remedied. Unquestionably the continued pressure from governments has been largely responsible for the adoption of the new visa procedure reported in my telegram 53, May 16, noon. It remains to be seen how this new procedure will work out in practice.

Copy to Paris.

  1. Not printed.