841D.51/345: Telegram

The Minister in Ireland (Gray) to the Secretary of State

11. For the Secretary and Under Secretary of State. The Vice Premier,6 who is also Minister of Finance, had lunch with me yesterday. He told me in confidence that England had told the Irish Government it could no longer supply allotments of various sea-borne goods by reason of lack of tonnage nor could they longer supply dollar exchange. Consequently it was necessary to make an American loan for purchase in America of ships, foodstuffs and he hoped, arms. He asked me confidentially if I would unofficially feel out the situation with National City Bank as he did not want to make proposals which would be turned down.

In our opinion, if Great Britain is not defeated, Ireland is a good risk. National debt at present about £35,000,000 with 3,000,000 population. Politically, an American loan would increase our influence here as would procurement for them of ships and other supplies for I believe that the time is ripe for demanding as a condition precedent to granting Irish requests, definite undertaking that in no circumstances whatever would Irish Government take an anti-American attitude.

The present situation is likely to educate Irish opinion as to its essential basic unity of economic and defensive interests with England. The amount of the loan would be under $50,000,000. William Burrill Hoffman, Vice President of the National City Bank, has been the officer in charge of previous Irish loans. I would suggest that he be [Page 217] sounded as to the proposals. It will strengthen our position here if we can get a prompt reply.

The Finance Minister told me that the Premier was glad I had spoken so frankly of the American position in my conversation of January 6 reported in my telegram No. 7, January 7. He hinted that the Premier’s position, as expressed to me, might be subject to change. It is evident that at last the significance of the President’s policy is beginning to be felt in Government circles.

  1. Sean T. O’Kelly.