Memorandum of Conversation, by the Adviser on Political Relations (Hornbeck)

Reference, my memorandum of conversation with Mr. Lamont of January 20.

Having taken up with the Under Secretary, Mr. Welles, the matters covered in my memorandum of January 20, and under instruction from Mr. Welles, I asked for Mr. Lamont on the telephone. Mr. Lamont was away from his office and I spoke with Mr. Arthur Anderson.

I inquired whether Mr. Anderson was familiar with the recent developments and recent communications on the subject of the China Consortium. Mr. Anderson replied that he was. I then referred to the conversation held between Mr. Lamont and myself yesterday and said that I had brought the whole matter again to Mr. Welles’ attention and that I was prepared to give, under instruction, our official opinion, of which I would request that Mr. Anderson inform Mr. Lamont before a certain meeting on Monday: our official opinion is that the present would be an inopportune moment, an especially inopportune moment, for taking steps, which would become a matter more or less of public knowledge, toward dissolution of the Consortium or withdrawal of the membership of the American Group. I said that I had gained the impression from what Mr. Lamont had said yesterday that Mr. Lamont and others who have been especially interested, in the American Group, were not so especially intent upon dissolution of the Consortium or withdrawal of the American Group as upon effecting certain changes in the procedural arrangements between the member Groups.

Mr. Anderson replied that he regretted Mr. Lamont’s absence; he would impart to Mr. Lamont early on Monday morning the message which I had given him; and it was a fact that the members of the American Group had become tired of paying fees when no business was being done and no services rendered.

I called attention to the fact that the information which I had given Mr. Lamont had been given confidentially and for his confidential information, and I expressed the hope that the conversations which we had had would be helpful toward the conservation of the interests of all concerned. Mr. Anderson thanked me and repeated the assurance that he would inform Mr. Lamont before the meeting on Monday.

Stanley K. Hornbeck