840.00R/2–1650: Telegram

The Chargé in the United Kingdom (Holmes) to the Secretary of State


911. 1. We have studied Bevin’s message to Secretary of State1 (Deptel London 705, Paris 628, Brussels 200, The Hague 147, Frankfort 1012, Rome 546, February 14)2 and discussed it with Harriman last night.

2. Embassy and ECA inclined accept message on face value as genuine expression of British concern over recent developments. It confirms McNeil’s statement to us (Embtel 534, January 30, repeated Paris 151), that British favor all-embracing payments union and we have had similar indications from Treasury and Foreign Office officials. Moreover, Cripps told Kenney before latter’s departure that problem could be and would be solved, although it would take some time. Finally, our own estimate of British objectives leads us believe they will suggest some way out of present impasse.

3. We think, and have some reason to believe, that Bevin sent message following his return to London in effort redeem situation which Cripps handled so maladroitly in Paris. Foreign Office and Bevin far more sensitive than Cripps to serious political complications which will arise over Germany, not only between Britain and US, but within Europe, if limited payments union is established. Finally, Bevin is naturally always concerned to keep Britain in step with US insofar as possible.

4. We do not think much progress can or will be made in near future establishing limited payments union and Harriman confirms this view. First, OEEC countries will be reluctant to go ahead without UK. [Page 631] Second, relation of Germany to payments union very complex and OEEC countries will be divided. Finally, Britain will no doubt exert additional pressure on OEEC countries to defer consideration of limited union until Britain has had chance to study problem further.

5. The affirmative position taken by Bevin in paragraph 3 of his message offers an excellent opportunity to press British again to give matter their most urgent attention.

Sent Department 911 repeated Paris 264 Brussels 46 The Hague 37 Frankfort 68 Rome 80.

  1. Message dated February 11, p. 627.
  2. Telegram 705 to London, not printed, transmitted the text of the February 11 message (840.00R/2–1450).