741.5/12–351: Telegram
The Economic Cooperation Administrator (Bissell) to the Embassy in France 1
Torep 9124. Reference: Paris to State 3210, Nov 29.2 Batt concurs. This joint State-ECA-DMS cable. For Harriman.
1. Rickett British Embassy has presented document as basis for negotiations on FY’52 aid.3 It confirms British request for $600 million, states British have been informed in Paris of possibility securing $300 million, and discusses ways and means of providing the other $300 million.
2. At meeting on Monday, Bissell, Batt, and Reps of State, Defense, and DMS will have preliminary discussion with British. Expect that initial US line will be that, while seriousness of British position is acknowledged, aid discussions should be occasion for general review of UK defense expenditure and whole short-term [Page 990] economic position, including review of balance of payments prospects for sterling area. Discussions will continue in London when Batt returns there December 10. Rickett going to London at same time.
3. In line with Paris Embtel 3210, we would hope that firm decision could be reached on level of FY’52 aid during December, at conclusion of this quick but intensive review of British economic position.
4. It is further hoped that it will be possible about same time to achieve firm understanding on levels steel allocation and on other commodity matters now under review here.
5. Timing announcement aid decision (as distinct from making decision) should be considered in relation Churchill visit, that is, might following further study implications be announced (a) before visit, (b) as part communiqué reporting result visit, or (c) independent of visit as aftermath TCC report.4
6. Informal interagency group here will be considering long term outlook and measures that might be taken in connection with US-Sterling Area economic relations, to put them on something better than ad hoc basis. While there might profitably be some informal high-level discussion this subject during Churchill visit, our present view is US Govt needs few weeks for internal considerations of far-reaching problems involved and early official level discussions with Brit wd therefore be impossible. Our idea under discussion here is that communiqué at conclusion of Churchill visit might announce establishment of joint Anglo-American committee or panel to consider long-term economic and financial relations between dollar and sterling and make recommendations for measures leading to solution of persistent problems which produce recurring crises.
- Drafted by Woodbridge and Cleveland and cleared by Batt (who was in Washington for consultations), Schelling, Ohly, Martin, and Bissell.↩
- Harriman reported in telegram 3210 that the British would submit a memorandum concerning their aid problem for fiscal year 1952. Harriman believed the negotiations on aid to the United Kingdom should be carried on in Washington and should not be delayed pending completion of the TCC report. (740.5–MAP/11–2951)↩
- A copy of the British memorandum, transmitted to Bissell as an enclosure to a letter dated November 29, is in file 741.5/12–351, together with a memorandum of Rickett’s conversation with U.S. officials at the time he presented the memorandum.↩
- For documentation on the work of the Temporary Council Committee (TCC), see vol. iii, Part 1, pp. 1 ff.↩