The British Prime Minister (Churchill) to President Roosevelt 94

Number 613. Your 474.

You will remember that we discussed the dollar balances in Cairo on December 8th and that I gave a memorandum to Harry.95 I certainly understood that you felt we ought not to be treated worse than France or Russia in these matters. France has at least two billions and no overseas liabilities against them. So has Russia. These dollar balances are not, as your telegram might suggest, a particular part of our assets which is available in the United States, but our total reserves. Against these reserves we have incurred for the common cause liabilities of at least ten billions on the other side of the account.
Since our talk, Lord Halifax met Mr. Hull and Mr. Morgenthau as recently as January 8th [7th], when the matters mentioned [Page 46] in the first paragraph of your telegram under reply were discussed. Lord Halifax reported to us that Mr. Morgenthau stated to him that it was not at present intended to reduce our dollar balances in any other way, and in reliance on this personal assurance to Lord Halifax, we agreed to the exclusion of the politically difficult item[s] from Lend-Lease.
Will you allow me to say that the suggestion of reducing our dollar balances, which constitute our sole liquid reserve, to one billion dollars would really not be consistent either with equal treatment of Allies or with any conception of equal sacrifice or pooling of resources. We have not shirked our duty or indulged in an easy way of living. We have already spent practically all our convertible foreign investments in the struggle. We alone of the Allies will emerge from the war with great overseas war debts. I do not know what would happen if we were now asked to disperse our last liquid reserves required to meet pressing needs, or how I could put my case to Parliament without it affecting public sentiment in the most painful manner and that at a time when British and American blood will be flowing in broad and equal streams and when the shortening of the war even by a month would far exceed the sums under consideration.
I venture to put these arguments before you in order that you may be fully armed with our case, for my confidence in your sense of justice and, I may add, in that of the American people is unshakable.
But see also my immediately following.
  1. Copy of telegram obtained from the Franklin D. Roosevelt Library, Hyde Park, N.Y.
  2. Reference is to Harry L. Hopkins, Special Assistant to President Roosevelt. For text of the memorandum, see Foreign Relations, The Conferences at Cairo and Tehran, 1943, p. 822.