841.24/440
Memorandum of Conversation, by the Secretary of State
Sir Frederick Phillips10 called at his request. I understood that Secretary Morgenthau had requested him to call to explain to me why the British Government could not put up any collateral, at least any substantial amount, as security for payment in connection with the five and one-quarter billion dollars worth of British orders in this country. Sir Frederick was reticent as to most of the figures I desired. I inquired as to how much cash or its equivalent the British Government expected to pay out in this country for military supplies obtained since the beginning of the war, that is, their estimated total expenditures up to the point where they would cease to make further payment and permit our Government to pay for all British supplies and deliver the same to Great Britain with barter or other arrangements, if any, that might later be entered into in regard to payment in whole or in part. He promptly indicated that he did not know what these figures were, but that they were available somewhere. I made further inquiries about the British financial situation, but with similar scant results.
I then said that this matter has been in the hands of Secretary Morgenthau and the President, and that I had virtually nothing to do with the drafting of the pending bill in Congress to authorize aid to [Page 5] Great Britain; that I had suggested three or four points which I thought would facilitate the passage of the bill and preserve increasingly favorable public opinion in support of the policy of aid to Great Britain; that one of these suggestions was that if the British intend to make any kind of payment during the next twelve months or so for military supplies procured in this country, now is the one accepted time for them to do so in the form of collateral with a minimum of a billion and a half or two billion dollars; that this action would go further to disarm critics and to keep this whole movement on a favorable basis than anything else that might be said or done. I elaborated on this phase. I still got nothing virtually from Sir Frederick in the way of either arguments or facts or figures. I made it clear that my purpose was to help Great Britain most effectively, through the aid furnished by this country, by keeping favorable public opinion behind our Government. I emphasized that every fact and phase of the entire British financial situation would be brought out in the Congressional Committee hearings on the pending bill to aid Great Britain; and I reiterated that the matter was in the hands of Secretary Morgenthau and the President, adding that I was determined to aid Great Britain to the best of my judgment and ability and hence I was making this and certain other suggestions, which were intended to facilitate the passage of the bill and its general support by the country. I made no impression whatever so far as I could see.
[For statements of the Secretary of State in support of the Lend-Lease Bill before the House Foreign Affairs Committee, January 15, 1941, see Department of State Bulletin, January 18, 1941, page 85.]
- Adviser to the British Treasury in the United States.↩