145. Telegram From the Department of State to the Embassy in the Soviet Union0

1618. Fourth meeting on lend lease negotiations today turned out to be last. Dispensing with preliminaries Menshikov read oral statement “clarifying” Soviet position in terms virtually identical to initial presentation January 11. Lend lease question would long since have been settled had not US suspended negotiations in 1951 (sic);1USSR war effort constituted benefit far exceeding cost lend lease to US; Article VII explicitly envisioned trade normalization. Khrushchev’s Camp David remarks also cited re necessity for eliminating trade discrimination and giving USSR no less favorable lend lease settlement than that given UK including extension of credits negotiated concurrently. Soviet Govt expressed regret “negative” US response contained in its January 21 statement2 and urged Soviet position (linking lend lease settlement with simultaneous conclusion most favored nation trade agreement and long-term credit) be given favorable consideration.

Bohlen summarized impasse as arising from unwillingness Soviet Govt to discuss lend lease as separate subject and inability US Govt to discuss concurrently two other subjects added to agenda by Soviets. US position identical to that which had been taken since it proposed resumption of negotiations and could not be called negative since it did not differ from our stand at outset as expressed in December 7 note apparently confirmed by Soviet reply of December 22.3 Menshikov reiterated that lend lease inseparably connected with other two subjects and constituted single indivisible whole.

We have issued press release4 adapted from statement given Soviets January 21 (Deptel 1581) and Soviet Embassy will undoubtedly follow suit. Bohlen has given press background briefing.

  1. Source: Department of State, Central Files, 711.56/1–2760. Confidential. Drafted by Isham; cleared in the Bureau of Economic Affairs, the Office of the Legal Adviser, and the Bureau of European Affairs; and approved by Bohlen.
  2. Regarding the suspension of U.S.-Soviet negotiations, see footnote 5, Document 65.
  3. The text of the statement read to Menshikov on January 21 was transmitted in telegram 1581 to Moscow, January 21. (Department of State, Central Files, 711.56/1–2160)
  4. See footnotes 2 and 3, Document 142.
  5. For text of this January 27 press release, see Department of State Bulletin, February 15, 1960, pp. 239–240.