The Secretary of State to the Embassy in the United Kingdom
2163. Eyes only for Douglas from Acheson. Following message received today from Bevin:1
“Following our conversation in Paris on June 20th I talked with the Prime Minister2 and the Chancellor of the Exchequer. I find that our dollar position is more serious than I supposed and that prompt action is essential to put things straight. We are considering what measures to take, and urgent consultation with the United States Government will be necessary. In the meantime we have given the United States Ambassador in London a memorandum of the facts,3 which it is understood Mr. Douglas is sending to the State Department.
I hope that it will be possible for Mr. Snyder4 to pay a very early visit to this country to discuss matters with Sir Stafford Cripps and that he will bring advisers from the State Department and ECA, as well as from the Treasury. We shall appoint officials on our side from the Treasury, the Foreign Office, and the Board of Trade to take part in the talks. We also propose that a Canadian Minister and officials should take part. We should like these meetings to begin on July eighth or ninth, before the meeting of members of the Commonwealth which we are trying to arrange for July eleventh.
I hope that you may have an early opportunity of discussing the situation with the President. I hope, too, that it may be possible for the United States Administration to take suitable action by the making of appropriate statements, etc., to damp down public agitation about [Page 791] a recession, as well as discussion of the position of sterling. In this way confidence would be restored.
Unless firm action is taken I fear that much of our work on Western Union and the Atlantic Pact will be undermined, and our progress in the cold war will be halted. It is because the political consequences may be so serious that I hope that Mr. Snyder may be accompanied by political, as well as financial advisers.
We naturally hope that publicity would be reduced to a minimum and this object might be helped by the fact that Mr. Snyder’s visit to Europe has already been announced. But if necessary we should be ready to say frankly that the discussions concern the dollar crisis.”
Harriman’s Repto 635,5 paragraph 3, indicates Cripps hopes obtain approval new austerity program prior publication figures July 5, which seems inconsistent with above message, particularly reference urgent consultation in first paragraph and later reference meetings to begin July eighth and ninth. My impression is that meetings July eighth and ninth immediately following release of figures on July fifth and simultaneous announcement new austerity program would leave little for consultation.
Snyder has agreed to advancing date his departure to 29th or 30th and remain available in Paris for discussions with you and Harriman for day or two. If your discussions with Snyder and Harriman indicate desirable, am certain Snyder would agree have Cripps come Paris for discussions over weekend or possibly Snyder might accompany you London for discussions with Bevin, Cripps and others. This would make available four days Snyder’s time and still permit him to depart morning July 5 to follow previously arranged itinerary. It has advantage of consultations prior to decisions to be announced July 5. Minimum publicity would be involved and I feel sure you, Harriman and your staff members could supply all assistance which Snyder would need.
Planning conference with Hoffman6 and Snyder Monday afternoon and will proceed with above plan unless you suggest modification.
Discussions with Snyder indicate he has no feeling that devaluation is necessarily best answer but wishes know what British, you and Harriman really think would be effective.
- Foreign Secretary Bevin’s message was sent in a letter from Sir Frederick Hover Millar, British Minister in the United States, to Secretary Acheson on June 22, not printed (841.51/6–2249). In another letter on the same day, not printed, Hoyer Millar indicated that the urgency of the British financial situation was increased by the fact that Sir Stafford Cripps had to go into a nursing home for two months’ treatment not later than July 17. (841.51/6–2249)↩
- Clement R. Attlee.↩
- The memorandum under reference was transmitted in telegram 2407, June 22, from London, not printed (841.5151/6–2249).↩
- John W. Snyder, Secretary of the Treasury.↩
- Not found in Department of State files.↩
- Paul G. Hoffman, Administrator for Economic Cooperation.↩