[Enclosure]
The Ambassador in the Soviet Union
(Harriman) to the
Secretary of State
Moscow, January 6, 1945—10 a. m.
[Received January 6—11:30 p. m.]
61. Now that I have recovered from my surprise at Molotov’s strange procedure in
initiating discussions regarding a post-war credit in such a
detailed aide-mémoire, I believe the
Department will be interested in receiving my reactions. (ReEmbs 29, January 4, 2 p.
m.)
One. I feel we should entirely disregard the unconventional
character of the document and the unreasonableness of its terms
and chalk it up to ignorance of normal business procedures and
the strange ideas of the Russians on how to get the best trade.
From our experience it has become increasingly my impression
that Mikoyan has not
divorced himself from his Armenian background. He starts
negotiations on the basis of “twice as much for half the price”
and then gives in bit by bit expecting in the process to wear us
out.
Two. Molotov made it very
plain that the Soviet Government placed high importance on a
large postwar credit as a basis for the development of
“Soviet-American relations”. From his statement I sensed an
implication that the development of our friendly relations would
depend upon a generous credit. It is of course my very strong
and earnest opinion that the question of the credit should be
tied into our overall diplomatic relations with the Soviet Union
and at the appropriate time the Russians should be given to
understand that our willingness to cooperate wholeheartedly with
them in their vast reconstruction problems will depend upon
their behavior in international matters. I feel, too, that the
eventual Lend-Lease settlement should also be borne in mind in
this connection.
Three. It would seem probable that the timing of the delivery of
this note had in mind the prospects of “a meeting”. I interpret
it therefore to indicate that should there be a meeting the
Russians would expect this subject to be discussed.
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Four. It would seem that the time had arrived when our
government’s policy should be crystallized and a decision
reached on what we are prepared to do provided other aspects of
our relations develop satisfactorily.
Five. It is my basic conviction that we should do everything we
can to assist the Soviet Union through credits in developing a
sound economy. I feel strongly that the sooner the Soviet Union
can develop a decent life for its people the more tolerant they
will become. One has to live in Russia a considerable period of
time to appreciate fully the unbelievably low standards which
prevail among the Russian people and the extent to which this
affects their outlook. The Soviet Government has proved in this
war that it can organize production effectively, and I am
satisfied that the great urge of Stalin and his associates is to provide a better
physical life for the Russian people, although they will retain
a substantial military establishment.
Six. I believe that the United States Government should retain
control of any credits granted in order that the political
advantages may be retained and that we may be satisfied the
equipment purchased is for purposes that meet our general
approval.
Seven. I notice in the note1 recently delivered to the Department by
Gromyko accepting the
Fourth Protocol the request by the Soviet Government that we
should put into production industrial equipment “which the
Soviet Government agrees to pay for under the terms of the long
term credit”. No reference, however, is made to the terms of
this credit and I assume therefore that the Soviet Government
refers to the terms proposed in the aide-mémoire handed me. If this is correct, it would
seem that the Soviet Government is attempting to improve our
proposals for the three C credit under Lend-Lease2 in this new proposal for combining the
Lend-Lease and postwar credits.
Eight. Quite apart from the question of the postwar credits, I
recommend that the Department inform the Soviet Government
promptly, either through Gromyko or through me to Molotov, or both: A/ that the
credit under Lend-Lease must be segregated from the
consideration of postwar credits; B/ that the Department has
already given its final term for the credit under three C; C/
that agreement must be reached on the terms of this Lend-Lease
credit before any further long range industrial equipment can be
put into production. From the experience we have observed in the
length of time the Russians are taking to erect the tire plant
and oil refineries there is little likelihood that equipment for
long range projects now put into production will have a direct
influence on the war, and unless the Soviet Government is
willing to accept the generous terms of our
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offer of financing it would not
appear that the equipment for these projects is urgently needed
at this time.
