The Ambassador in the United Kingdom (Winant) to the Secretary of State
[Received March 10—5:40 a.m.]
2440. From Judge Rosenman.60 A discussion was held yesterday with Lord Keynes, Sir Wilfrid Eady and Mr. Harmer of the British Treasury on the British post-war Department and Phelps of State Department.61
It was agreed that this discussion was to be completely off the record and not for publication in any way; that it [represented personal?] views rather than the official views of the Government.
I stated briefly that the main objective of the mission was to investigate supply matters for the liberated areas but that you also wished me to speak informally with high officials about reconstruction and post-war financial problems so that some background might be secured for our own thinking on these topics.
Lord Keynes replied that their chief interest and attention had been focused on the Phase II agreement including the renewal of the Lend-Lease Act,62 and the request for appropriation. He stated that further discussions might be scheduled for early summer or soon after the end of hostilities in Europe. At that time the most important immediate problem would concern: (1) arrangements for the transitional period immediately following the cessation of hostilities in the Pacific during which military expenditures will continue; (2) the time and the arrangements under which Lend-Lease and mutual aid deliveries [Page 29] will be terminated including materials in the pipeline. Apparently the British feel that the lack of decisions on these matters and certain imponderables, including (a) the duration of the war in the Pacific, (b) the rate of growth of sterling balances, (c) the rapidity of reconversion and the increase in exports achieved after V–E Day, and (d) the results of a general election if one be held, make it impossible to evaluate accurately the British post-war financial position at this time. Lord Keynes stated it as his personal opinion that neither lend-lease nor credit arrangements under section 3c63 would be acceptable to the British after hostilities in the Pacific had ceased.
Lord Keynes noted that British will be the only United Nation which will emerge from the war with a seriously impaired external financial position and stated that some way must be found to improve this position if an effective world economic structure of the type desired both by the United States and Britain is to be attained. In this discussion Lord Keynes said that bilateralism and regional preferential systems were considered by the present Government as poor alternatives to full international collaboration on a non-preferential basis. It was his belief that if a workable economic system could be established these alternatives would not appear as significant nor as attractive to British officials as might be inferred from present discussions, A further conference on this general topic will be arranged with Sir John Anderson, Chancellor of the Exchequer.64 [Rosenman.]
Judge Rosenman requests the above message be delivered to the President.
- Samuel I. Rosenman, Special Counsel to President Roosevelt, was on a special mission to the countries of northwest Europe as the President’s personal representative to inquire into the problem of civilian supplies for liberated areas; for documentation on the subject, see vol. ii, pp. 1059 ff.↩
- Apparent garble. Presumably the sentence was intended to read: “A discussion was held yesterday with Lord Keynes, Sir Wilfrid Eady and Mr. Harmer of the British Treasury and Phelps of State Department on the British post-war financial outlook.” Frederic E. Harmer was Temporary Assistant Secretary, British Treasury; Dudley M. Phelps, Chief of the Division of Foreign Economic Development, was accompanying Judge Rosenman.↩
- Approved March 11, 1941; 55 Stat. 31.↩
- Section 3c was substantially altered when the Lend-Lease Act was renewed, April 16, 1945; 59 Stat. 52.↩
- No record of such a conference has been found in Department files.↩