841.24/1093b Suppl.: Telegram

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

358. Department’s 5789, December 9, 7 p.m., and 5790, December 9, 8 p.m.2 Preoccupation with urgent military matters and with coordination of the British and American war effort in the fields of [Page 526]strategy and supply has until now prevented further progress being made with the interim Lend-Lease Agreement. The President now feels strongly, however, that an agreement ought to be concluded without further delay and hopes strongly that the present draft modified by minor verbal changes to accord with the existence of a state of war (see first whereas clause and Article II3) will be accepted promptly by the British Government. The President carefully considered whether, if the British Government continued to find difficulty with the discrimination clause in Article VII,4 which difficulty he believed to be unwarranted by the text, this Government should be prepared to strike out Article VII in entirety and provide only for the continuation of conversations through representatives authorized for this purpose to agree both upon matters of immediate importance arising under the agreement and upon the economic considerations, entering into the final terms and conditions. The President felt that such an agreement would not provide any indication of the general nature of the final arrangements, and would therefore be unsatisfactory to us and would leave the British in a much more uncertain and difficult future economic situation. For this reason the President strongly hopes that the present draft will be accepted. It is clear that further attempts to refine the language of Article VII would be wholly unprofitable and time-consuming. The foregoing was communicated orally to Lord Halifax5 yesterday and he has telegraphed London.

You are requested to discuss this matter with Mr. Eden,6 the Chancellor of the Exchequer7 and in your discretion with the Prime Minister.8 For your confidential information the President raised this matter with the Prime Minister but found him unprepared to discuss it and preoccupied with other matters; If necessary, in your discussions please stress the points made in our 5790 of January [December] 9, as there appears to be persistent misunderstanding of Article VII in London.

The Department has been requested to be prepared about the middle of next week to testify before the appropriation committee of the House on the status of Lend-Lease agreements. It is most important that the Department’s representative be in a position to make a definite statement regarding the British negotiations.

It is also important that arrangements be made as soon as possible relating to the articles and facilities which the British Government [Page 527]and the Dominion Governments may furnish the United States in connection with expeditionary forces, naval forces or otherwise. Such arrangements will be subsidiary agreements within the framework of the Lend-Lease agreement.

Some confusion appears to have been created by a recent discussion in the press and elsewhere suggesting that the lend-lease basis of dealing with these matters as between the United States and Great Britain has been displaced by a new concept relating to pooling of resources, et cetera. The confusion seems to arise by not keeping clearly in mind the difference between (a) a policy which will guide the two Governments, as allies in the war, in the disposition of their resources, and (b) the actual legislative basis and terms of settlement for the transfers of materials and services made back and forth between them. The only present legislation establishing authority in this Government to furnish aid to our Allies and to carry out a policy of “pooling resources” is the Lend-Lease Act;9 and that Act is flexible enough to achieve our purpose and policy. It is essential that the provisions of this Act be followed and that the agreements contemplated and required by it be promptly made.

Hull
  1. Ibid., pp. 46 and 47.
  2. See draft, Foreign Relations, 1941, vol. iii, p. 13.
  3. See revised draft of article VII in telegram No. 5637, December 3, 1941, midnight, to the Ambassador in the United Kingdom, ibid., p. 45.
  4. British Ambassador in the United States.
  5. Anthony Eden, British Secretary of State for Foreign Affairs.
  6. Sir Kingsley Wood.
  7. Winston Churchill.
  8. Approved March 11, 1941; 55 Stat. 31.