Volume 827, March 10 - March 13, 1945

RECISION TRADE MARK MICROSTAT NO. 1. PAIL OFF. MICROFILM BOLL NO. NO. A Book Page American Bankers Association See also Post-War Planning: Bretton Woods Conference General position with respect to all monetary legislation over the past five decades - 3/10/45 627 13 a - Barth, Alfred V. See Foreign Funds Control: Chase National Bank Baruch. Bernard M. See Post-Var Planning: Germany Business Conditions Hass memorandum on situation. week ending March 10. 1945 - 3/12/45. 115 Byrnes, James 1. See Post-Var Planning: Germany - o - Chass National Bank DIART See Foreign Punde Control China Gold situation (current) reviewed by Adler - 3/11/45 53 Book 827 Chrysler Export Corporation-Treasury correspondence concerning Kunming operation contract - 3/13/45 261 (See also Book 828- page 366 - 3/16/45) March 10-13, 1945 Financial situation reviewed in Adler cable - 3/13/45 308 United Clearing Board: Sale of negotiable checks in China reviewed in Adler memorandum - 3/13/45 313 Chrysler Export Corporation See China - 7 - Financing, Government Var Savings Bonds: 7th Var Loan Drive 106Jr's speech is Minnempolis: See Speeches by 10Wr Foreign Funds Control Chase National Bank Barth (Alfred V.)-State-Treasury correspondence concerning connection with Paris branch - 3/13/45 296 (See also Book 814: Book 828. page 132) Niedermann (in charge of Paris office during German occupation) discharged by Chase - 3/14/45: See Book un. page 130 France See also Lend-Lease French Private Assets in U.S. - inquiry concerning by United Kingdom anovered by Treasury - 3/13/45 236 a) Brand's office acknowledges - 3/14/45: See Book 020. page 205 Regraded Unclassified PRECISION TRADE MARK MICROSTAT/ 156. v. $. PAT. OFF, MICROFILM ROLL NO. - a - P - Book Page Book Page Germany Post-War Planning See Post-Var Planning Bretton Woods Conference Gold American Bankers Association See China for general position on monetary legislation ... American Jankers Association Chancellor of Exchequer disapproves American Bankers E - Association stand - 3/6/45 627 276 Germany Hungary See also Post-War Flanning (Talta Conference) See Var Refuges Board Draft Directive for the treatment of Germany se OK'd by FDR and Stettinius . 3/10/45 1 daruch's visit to Ingland discussed by Treasury group - : - 160 3/13/45 a) Byrnes' attitude toward Committee recommended India by Baruch to FDR discussed 162 See Lend-Lease b) White House asked If Treasury naterial should be given Baruch . 3/16/45: See Book 628- pages 344,345,348 - J - e) DuBots-Lubell (Assistant to Baruch) luncheon conversation reported by MMJr - 3/16/45: JCS 1067 See Post-Var Planning Germany Book 822- page 232 4) Lubell asks that Baruch be above copy of directive as signed by FDR on March 23 - 1, - - 3/24/45: Book B32. page k Exports from Occupied Germany during period of military operation - policy explained in Com memorandum - Lend-Lease 171 France: Documents comprising Agreement sent to RWz 2/13/45 by State Department - 3/13/45 827 197 Financial Directive. Appendix B. of JCS 1067 - revised draft approved by Treasury - 3/13/45 181 India: Use of Lend-Lease silver discussed is Senstor McCarran-Voreign Economic Aiministration-Tremeury Draft Directive as OK'd by FIR and Stattinius correspondence - 3/18/45 190 March 10. 1945 discussed by HWr. Stattinius, and United Kingdom - Phase 2: "Take-outs" of British-owned Grev: conversation reported to Treasury group capital facilities discussed in Brand (Daited Kingdom)- 3/15/45: Book 121. page 233 Treasury-War correspondence - 3/13/45 194 a) Strong disapproval registered by INJr a) Var Department to review entire matter - Land-Lease D& b) Document covers a great deal more than 1067 3/21/45: See Book 630. page 181 Charchill latter to and reparations: really goes into fundamental Lubell, San (Assistant to Bernard Baruch) FDR ne partive - policy* - DoBois: Book 820- page 236 Sea Post-Var Planning: Germany 2/19/45 MBC e) McCloy strongly disapproves: Var Department did not see although Stettinius so reported to FDR - 3/15/45: Book 626, page 209 M McCloy-HMJr conversation - 3/17/45: Book 822. page 2 a) HMJr tells KeCloy of above talk with Stettinius Minnempolis. Minnesota b) Treasury preparing report showing difference See Speeches for HWr between this interpretation of the Protocol and the original 1067 e) Stimeon's talk with FIR reported by McCloy N - 4) Var Department conference also described by McCloy Niedermann, Mr. e) Hiddleberger and Dupres (State/ responsible See Foreign Funda Control: Chase National Jank for changes Regraded Unclassified PRECISION TRADS MARE MICROSTAT/ us. PAZ. OFF. MICROFILM ROLL NO. - P . (Continued) - V - (Continued) Book Page Book Page Var Refuges Board (Continued) Post-War Planning (Continued) Switzerland Talta Conference: Decisions on Germany as reported See also Book 0.24 by Matthews (State) to Eleenbower's Chief of Staff - Coe memorandum - 3/12/45 827 64 UNHRA-War Refuges Board conference - 3/10/45 627 25 a) UNREA decides to regard interness, cace they are a) McSherry nemorandum to Chief of Staff: in Switzerland, as their wards - 3/14/45: "Military Government Problems Requiring Immediate 67 See Book 128. page 99 Agreement with Bussians' - 3/3/45 Rabbie Kalmanowits, Kotler, Korff. and Mr. Bunia b) Stettinius asked by HMJr to see political part of discussions at Talta - 3/16/45: See Book 828. confer with HKJr. 0'Dwyer, and Miss Model - 3/13/45 237 a) Memorandum presented by Rabbie 241 Trade 1 Rules the international trade page 350 169.A - HMA letter to FDR, sirsity not unt 1) Discussion by O'Dwyer, Grew, and McCloy's 144.8 representative reported - 3/20/45: to Charchill - FDR wastes 9 I Article a Land Law. 164.8 Book 032. page 125 Var Sevings Bonds See Financing. Government Silver See Lond-Lease: India Speeches by EWr - T - 7th Var Loan Drive Minnempolis Club (first of two luncheon meetings to Talta Conference inform top management of plan for sale of Bonds in See Post-War Planning industrial plants). March 12. 1945 Breakfast guests. 84 Acceptances for luncheon 76 Cocktail party guests 83 EMir's schedule in Minnespolis 81 Minnempolis Civie and Commerce Association and Draft 2 14 Foreign Policy Association Deaft 3 101-6 Draft 1 of speech. 66 Reading copy. 249A W, 250 Letters of thanks - 3/14/45: See Book 628. page 192 Sweden See Var Refugee Board Switzerland See Var Refuges Board U - United Clearing Board See China United Kingdom See France - Lend-Lease (Phase 2) United Nations Relief and Rehabilitation Administration See Var Refuges Board - Y . Var Refuges Board Swedish achievements is Hungary - report from Olsen, Special Attache in Stockholm - 3/12/45 59,103 Regraded Unclassified MICKOPILM NO 2" March 10, 1945 TOP SECRET ERSH on MEMORANDUM FUB This PRESIDENT Subject: Germany Draft Directive for the Treatment of HR Your memorandum of February 20 directed me to assume the responsibility for carrying, forward the conclusions you reached nt the Crimen Conference. In pursuance ereof, I an attaching for your approval n. auggested directive on the treatment of Germany which I believe conforms to the Yalta discussions and decisions. I believe that such n. directive is urgently necessary to implement the Talte decisions and continue the formulation and development of United States policy to be concerted vith our Allies. If you a, rove of the attached directive, I suggest the establishment of an informal policy committee on Germany under the chair- manship of the Department of State and including re- presentatives of War, Davy, Treasury and tito Foreign Leonomic Administration. This committee would serve as the central source of policy guidance for American officials both civilien and military on questions relating to the treatment of Germany and its proceedings would be based on the attached directive. Enclosure: Suggested directive. TOP SECRET March 10, 1945 Draft Directive For The Treatment of Germany I. MILITARY GOVERNMENT 1. The inter-allied military government envisaged Medings in the international agreement on control machinery X for Jermany shell take the place, and assume the functions, of a central government of Germany. 2. The authority of the Control Council shall be paramount throughout Germany. The zones of occupation shall be areas for the enforcement of the Council's decisions rather than regions in which the zone commanders possess a wide Intitude of autonomous power. 3. German administrative machinery must be purged at set forth below. It shell be used in 80 far 88 it can surve the purposes of this directive and does not permit Mazi abuses. II. INDIATE SMERITI LEASURES 1. The German armed forces, including para-military organizations, shall be promptly demobilized and disbunded. 2. All PRECISION TRADE MARK MICROSTAT NO. U.S. PAT. OH, MICROFILM BOLL NO. 12" 10P SECRET TOP SECRET -2- -3- 2. All military and para-ullitary agencies, including social services of these organizations no are deemed tice Conoral Staff, partly militer, and quasi- Ter-irable may be transferred to other agencies. military organizations, the Reserve Corps, and 2. 2021 lowd which provided the legal basis of the Hitler militer, academics, together with all associa- regime and which catablished discriminations on tions service to keep alive the military tradition grounde of race, creed, and political opinion in Ger-rity shall Le immediately lissolved and shall be abolished. thereafter prohibited. D. All Hasi public institutions (such as the People's D. All German erea. ammition and includenta of war Courts and Labor Front) which were set up na instru- ahell be reloved or lestroyed. ments of Party domination shall be abolished. - Vilitary archives and military research facilities 4. Active Mazia and supporters of Maxima and other shall be confiscated. individuals hostile to Allied purposes, shall be 5. The and the importation of arms, not eliminated from public and quasi-public office and manition and involuments of was shall de probizited. from positions of importance in private enterprise. C. The Ger.en airor-ft is lustry shall is dicentled Active mazia shell DO defined na those approximately and the furjher menufacture of aircraft and come two million members of the Party who have been ponent parts shall Le Lenceforth prohibited. lenders at all levela, from local to national, in 237. I.M.DIA. POLITICAL y ADDRES the Porty and its aubordinate organizations. 1. The lazi Party and its affilisted and supervised 2. Ensi politionl malefactors and all war criminale organizations shall be dissolved and their revival shall be arrested and punished. in any form shall be pronibited. Such non-political 6, Germans social RECISION TRADE MARK MICROSTAT REG. PAT. OFF, MICROFILM sou NO. 2" TOP SECRET TOP SECRET 6. Gensans taken abroad for labor reparation shall be January 1, 1938,with the exception of Sast Prussia drawn primarily from the ranks of the active Insia and Uppor Silesia, shall be administered and control- and of Kazi organizations, notably from the SS and led as an economic unit. the Gentapo. 2. The economy of Germany shall be directed, controlled This procedure will serve the double purpose of elimi- and administered in such a way 8.0 to nating many of the worst carriers of Resi influence from (a) Provide facilities for, and contribute to Germany and of compelling the guilty to expinte their the maintenance of the occupying forces and crimes and to repair some of the damage they have done. occupying authorities. 7. Under the direction and supervision of the Control (b) Stop the production, acquisition and develop- Council there whell be established throughout ment of implements of war and their specialized Germany a mified system of control over mil meens parts and components. of disseminating public information. (c) Provide n. minimum standard of living for the 15. There shall be established a uniform system of con- German people including such food, shelter, trol over German education designed completely to clothing and medical supplies na are required eliminate Lesi doctrimes and to make possible the to prevent disorder and disonse on a scale that development of democratic ideas. would make the task of occupation and the col- IV. CUSTROL lection of reparation substantially more 1. Pending definite decision on revision of boundaries difficult. and partitioning occurary 0.0 it oxisted - (d) Provide quel. goods and services to Allied January 1, com ries for relief, restitution and reparation NO will be in excess of the requirements of the occupation Regraded Unclassified PRECISION TRADE MARK MICROSTAT REG. M. 1. PAT. OFF. MICROFILM ROLL NO. 12" TOP SECRET TOP SECRET -7- occupation forces and the minitori of manypower and urmaportation. living. 2x : La recognized that the prevention of uncontrol- (a) Conform to such minsures for the reduction lvd inflation is in the interest of the United and control of Gergeny's wer potential Actions. The Control Council shall strive to in- no the Allivi - prescribe. auro was appropriate controls, both financial and 1, to 10, inclusive.) direct, NEW unletained or revived. It in recognized West a substantial 10 of COMP -. The Control Jouicil shall util se centrolized in- tralized financial and con rel atrumentalities for the execution end implementa- to the dischar o of the under dontioned in arregraph Lion 01 its policies and directives to the maximum 2. The Con rol Council shall Invo overal responsi- goonible subject to supervision and scrutiny bility for insurin Livit all consures necessary to we a DI Lice accurrin forces. Whenever central German and are taken. is uncies or administrative services which are +. In particular, the Control Council shall ou enjoyed is eded for the adoquato performance of such tasks to formilate, within the of oxisting not Love consed CO function May shall be revived or future directives, unsio policies govern (-) replaced a regioly na possible. public finance; money and credit, (-) prices and 7. TAX Lefore utilizing Germen B. encies military govern- vrgon, (c) 18 doning, (d) inland transportation and more authorities must carry through enazification (4) (f) internal in accordance with use principles act forth couserce, () foreign BALL international JAY- nieve, musts, (ii) restitution and reporation, (1) treat- (6) verms: nationale deprived of their positions ment and movement or displaced persons, new (3) because of previous affiliations with or support allocation of plant and equipment, matorials, of the Mazi party or because of disloyalty to empower the PRECISION TRADE MARK MICROSTAT NO. V. 5. PAL OFF. MICROFILM ROLL NO. 2" TOP SECRET TOP SECRET the military government authorities shall De objecte of unique cultural and artistic value replaced ná far as possible by other German whenever looted property falling within these nationale. In recruiting replacements mili- categories cannot be found and restored. tary goverment officers shall rely aa each 11. Germany must make substantial reparation for damage as practicable on the londers and personnel of to, or lonses of, non-military property caused by froely organized Inbor unions and professional or incident to hostilities. Such reparation shall associations and of such anti-Nazi political tako the form of (a) confiscation of all German croupings and parties 0.0 may ariso in versiny. property, claims and interesta abroad, (b) deli- D. Military government siall eliminate active Ensis and veries from existing German nesets, particularly supporters of the Nazi regime and other individuals capital equipment (c) deliveries from future German hostile to Allied purposes, from dominent positions output, and (a) German labor services in devastated in industry, trade and finance. countries. 9. Hilitary government shall permit free and spontaneous 12. The reparation burden and schedules for delivery organization of lebor and professional employees. should be determined in such e. manner that Germany It shall facilitate collective barghining etween dan discharge its obligation within a. period of ten employers and employees regarding wages and working years from the cessation of organized hostilities. conditions subject to overall wage controls and 15. The volume and character of German reparation deli- considerations of militory necessity. verios of capital equipment shall be largely deter- 10. Geruany anall be required to restore all identi- mined in euch B. may 0.8 to reduce Germany's relative finble property which has been taken from invaded predominance in capital gooda industries of key countries. It shall also be compelled to replace importance and to rehabilitate, strengthen and objects develop -10- TOP SECRET TOP SECRET -11- develop such industries in other European countries, such cartels or arrangements shall be promptly as part of a broad pro ram of reconstruction. terminated. 14. Germany shall be prohibited from ongazing in the 18. The scope and execution of the economic disarmament production and development of all implements of war. program should be made compatible with the payment of All specialized facilities for the production of reparation and both the reparation and economic armaments shall Lie destroyed, and all laboratories, disarmment programs should take into consideration plants and testing stations specializing in research, the necessity of maintaining B. minimum German development and testing of implements of war shall be standard of living as defined in paragraph 2. closed and their equipment removed or destroyed. 19. In fulfillment of this principle, Germany shall be 15. Germany shell also be forbidden to produce or main- made to begin paying her own way as soon as possible. tain facilities for the production of aircraft, There shall be no simultaneous payment of reparation synthetic oil, synthetic rubber and light metals. by Germany and extension of credit to Germany. Production facilities in these industries shall be Payment for such imports as are authorized by the removed to other countries or destroyed. Control Council shall be made a first charge on the 16. In order to foster and develop metal, machinery and proceeds of German exports. If Germany is unable chemical industries in other countries, exports of to export sufficient goods in excess of reparation competing Gorman products shell be subjected to deliveries to pay for authorized imports, reparation restraint for & considerable period. At the same recipients shall be required to shoulder this defi- time, German production and export of coal and light cit in proportion to their respective receipts from consumer goods shall be facilitated. reparation. 17. German firms shall be prohibited from participating in international cartels or other restrictive contracts or arrangements, Existing German participations in such RECISION TRADE MARK MICROSTAT ass. V. PAT. OFF. MICROFILM ROLL NO. yar. 10, 1945 AMERICAN BANKENS ASSOCIATION - 2 - disfavor any compromise with the proponenta of the Steenarson I. General Position With Respect To Legislation HIL by which the existing powers of Fostal Savings Banks be The American Bankers Association has opposed many of the princi- in any respect enlarged . # -," (Proceedings, American Bankers pal alterations in banking, currency and financial law of the past Association., 1922, P. 119). five decades. As late as December 1935, the Association passed a resolution condemning as "inequitable" the "competition of the Postal Savings (a) Postal Savings System with privately-owned banks through the relatively high interest Postal Savings was established in the United States by legislation rate and liberal interest privileges allowed its depositors." enacted on June 25, 1910, "after nearly forty years of discussion of fostal Savings in the United States, during which time eight Post- (b) Quarantee of Bank Deposits by the Federal Government masters General had urged the establishment of Postal Savings Banks; after 80 bills had been introduced in Congress for this purpose) after all political parties had advocated such a system in their platforms; The denanda for insurance of deposits were virtually as old as and after Presidents Roosevelt and Taft had urged the establishment of that for establishment of a Postal Savings System. The American Bankers Association has at all times opposed the institution of a a Postal Savings System." (See *The Postal Savings System of the United States," American Bankers Association Condittee on Sanking deposit guarantee eyatem, and the establishment of the Federal Deposit Insurance Corporation by the Banking Act of 1933 was insufficient to Studies, at P. 7). quell the opposition of the Association. Both before the establishment of the Postal Savings System, and virtually to the present time, the American Bankers Association has The American Bankers Association successfully resisted all early officially opposed Postal Savings in general or particular phases of attempts to cuarantee deposits. Its legislative committee reported that it was: its operation. "opposed to the guaranteeing of deposits by either The American Bankers Association opposed the establishment of State or Federal Government." (Proceedings, American Bankers Postal Savings Banks, condemning it 48 unwise: Association, 1908, P. 283) "It is the opinion of this Association that we Its report was adopted and the Association stated that it was) should condemn in unqualified terms the proposition for the establishment of Postal Savings Banks - # - (Proceedings, American Bankers Association, 1909, P+ 252) "unalterably opposed to any arbitrary plan looking to the mutual guaranty of deposits either by a state or the nation, believing it to be impractical, unsound and nis- The Savings Bank Division resolved that it leading, revolutionary in character and subversive to sound economics, placing 4 tool in the handa of the "depreciates the agitation for an enlarged system of unscrupulous and inexperienced for reckless banking, and Postal Savings banking paying an increased rate of knowing further that such a law would weaken our banking interest, and hereby protest against any legislation system and jeopardise the interest of the people." (Pro- to that end." (Proceedings, American Bankers Association, ceedings, American Bankers Association, 1908, P. 286). 1921, P. 198) The Committee on Federal Legislation opposed the Steenarson Bill Similar opposition was voiced in 1909 (Froceedings, p. 250, 260). (to asend the Postal Savings Law by increasing the maxtmum deposit After the adoption of the Federal Reserve System, attempts were and the rate of interest to be paid to depositors) and adopted a again made to provide for the guaranty of deposits. Again, the Association objected. Its Federal Legislative Committee reported: motion to "oppose any increase in the powers of the Postal Savings System including the rate of interest which they pay and Regraded Unclassified PRECISION TRADE MARK MICROSTAT/ PAY. OFF. MICROFILM BOLL NO. 16 3 - "As our Association 1a on record, by resolution, as - 4 opposed to the guaranty of bank deposita by the States or by the Nation, we have opposed the bill introduced in the The American Bankers Association remained skeptical of the last session, providing for the guarantee of deposits in Federal Deposit Insurance in 1941 when it was stated by its research banks of the Federal Reserve System. --- This bill --- council, in reply to a questionnaire of the United States Senste to à measure which, if enacted into law, would seriously Committee on banking and currency "Federal Deposit Insurance affect the banks of this country." (Proceedings, 1932) must still, in view of previous experience with state funds, be considered as experimental and not tested in the crucible of ex- and in 19331 perience under varied economic conditions." **** the American Bankers Association hereby records its (e) The Federal Reserve System deliberate judgment that the dangers involved in attempting to initiate at the beginning of 1936 the provisions for The Federal Reserve System was an outgrowth of proposals for deposit insurance contained in the Bank Act of 1933 are central reserve banking facilities which had been pending for sany genuine and serious. - (Proceedings, 1933, P. 36) years. The first action by the executive council of the American Bankers Association approving any central reserve system vas in The President of the American Bankers Association, urging mebers 1911. At that time, the president of the association pointed out to telegraph to the President recommending veto of the deposit insurance that: provision of the Banking Act of 1933, stated: *It is almost inconceivable that bankers should have taken *The guaranty of bank deposite has been tried in & thirty-seven years in coming to some solution satisfactory to then- number of states and resulted invariably in confusion and selves, and 1% in to be hoped that the present convention will give disaster to the financial structure of the states, and If its approval of the action of the executive council in such a positive our party when returned to power should incorporate such a way that the whole country will understand that the bankers have at schene in the federal organization, we would drive the last agreed with practical unandadity on the cause of the trouble and strongest member banks from the Federal Reserve system." the renedy." An aditorial in the American Bankers Association Journal for The neasure approved by the Association was however not acceptable to June 1933, at page 28, took the position that, the Congress and new neasures were introduced by Carter Class, Chairman of the House Banking and Finance Committee. The Class neasure which "It 10 entirely possible that the unwarranted burden was the basis of the Federal Reserve Act was disapproved by the American that the [deposit insurance provisions] of the [Banking Act Bankers Association apparently for the reasons, among others, that of 1933] would place on good banks night threaten the investment in the stock of the Federal Reserve Banks WILD compulary, stability of the entire banking structure." and the individual banks had 4 minority representation in the Federal Reserve Banks and no voice whatever in the selection of the Federal The President of the American Bankers Association stated that Reserve Board. 1/ (See Proceedings American Bankers Association, 1913, the scheze is not "different in essential purpose from the guarantee pages 64-65, 757 of deposit schemes that have been tried in eight western states and invariably failed," and that "the Economic Policy Commission of the I/ In reporting on the Class bill to the American Bankers' Association, American Bankers Association has just completed a partial restudy its Currency Commission stated: of the history and results of the deposit guarantee plans and the simple facts of these cases put then beyond the pale of aound - The question is asked, my, if the bankers approved such remedies for the banking problem." (See address published 56 Trust provisions in the so-called Aldrich bill, do they oppose sisilar Company 680 (June 1933)). provisions in the so-called Class-Owen bill?' This is the reason: "(a) Investment in the stock of the Central Reserve Associ- ation created by the bill of the National Monetary Commission was permissive, not compulaory; banks might invest in the SATA if they chose, or they might decline the opportunity, in accordance with the dictates of their business judgment. Regraded Unclassified RECISION TRADE MARK MICROSTAT RSG. M. 1. PAT. OFF, MICROFILM BOLL NO. 18 - 5 - - 6 - The American Bankers Association then presented certain amendmente to the Committee on Banking and Currency for the purpose of partially (d) General Philosophy of the American Bankers Association in Connection with Legislation Involving Extension of Govern- restoring the features which it deened desirable. (See Proceedings, mental Credit or Governmental Expenditure. of the American Bankers Association, 1913, at PP. 112-13. The basic objections by the American Bankers Association were, The general attitude of the American Bankers Association with however, not net in the Federal Reserve Act as enacted. respect to the extension of credit by the United States Government is somewhat indicated toyr the "statement of A.B.A.'s position on Today the American Bankers Association apparently has on the whole socialized credit." approved the Federal Reserve Act as relatively good legislation. See, *The American Bankers Association has long been opposed to for example, statement of Mylander, representing the American Bankers the socialization of credit by the Government. By socialization, Association, in Hearings before Committee on Agriculture, 76th Cong. we sean the extension of credit and the making of loans by the 3d Seas. on H.B. 8748 (1940) at P. lab. Federal Government with costs and losses paid out of the Federal Treasury either directly or indirectly. Our position supports the stand maintained to leading farm organizations as they oppose the control of agricultural credit by political forces. *It is recognized that direct relief by the Government in times of serious economic stress may involve scee granting of loans from public funds as a temporary emergency expedient. However, the continued practice of making uneconomie loans from public funds, without the adequate consideration of the ability of the borrower to repay and with the losses socialized at the expense of the taxpayers, violates the principles on which credit rests and thereby endangers the foundation of & sound credit structure." (Resolntion at the closing session of the wartine service meeting, September 15, 1943) Continuation of footnote 1/ from P. 11. *(b) Under the terms of the bill of the National Monetary Con- mission, the bankers controlled the management of the Central Reserve Association. It follows that an investment in the stock of the Association was an investment under their own control and management, On the contrary, investment in the stock of the Federal Reserve Banks of the Glass-Owen bill is compulsory. The individual banks have a minority representation in the management of these Federal Reserve Banks and have no voice whatever in the selection of the Federal Reserve Board, which dominates the Federal Reserve Banks, and the proposed measure only provides that one of the seven members must have banking experience. "The fact that the bankers controlled the Central Reserve Associ- ation was a guarantee against political control, and 11 was equally a guarantee against incompetent management-two important respects wherein the pending seasure is lacking." Proceedings, American Bankers Associ- ation, 1913, P. 75). Regraded Unclassified PRECISION TRADE MARE MICROSTAT KSS. M. s. FAT. DIF. MICROFILM ROLL NO. 20 7 - a . n. Tactics And Interest or The American Bankers Association In Connection with Legislation (b) Indirect Opposition to Legislation (a) Dilatory Tactice in Opposition to Legislation. At times the Association has found it advisable to adopt 4 more indirect approach: Although the question of a guarantee of deposits had been dis- cussed from time to time since 1906, the 1933 report of the Recondo "In the submission of this report the Legislative Com- Policy Commission recomended: mittee in asking for its approval in very mild and polite terms condenns postal savings banks, but 1% also recognizes "that the official representatives of this association as inssmuch as two political parties have spoken for 1t, it be directed to urge upon the National Administration at is unwise for this Convention to place itself on record in Washington the desirability of postponing by legislation or offensive terms against that proposition if they seek to otherwise the initiation of deposit insurance until an ade- accomplish anything with the legislative authorities in quate study and report can be nade of the probable results shaping the Law, if we must have the law. (Procaedings, 1908, that would follow the putting into effect . # . the provisions P. 292) of the new banking law . # ell (Proceedings American Bankers and adopted & Resolution Association, 1933, P+ 34). "that the American Bankers Association welcomes all legisla- , This report was favorably adopted. Likewise the Association tion that adds to the security and advancement of the busi- adopted the Report of the Committee on Resolutions which stated thats ness of the people, but deess the proposed plan of guarantee- ing bank deposita and of establishing government savings banks % recomend to the Pational Administration at Washington 48 unrise and hurtful." (Proceedings, 1908, P. 293) that it seek means for postponing the initiation of deposit insurance . In 1910 the Postal Savings Committee reported as follows: " . means should be found to postpone action in putting "As it became more and more evident that an attempt would into effect the proposed neasures for deposit insurance "," be made to pass a postal savings bank bill your Committee urged upon the various Clearing House Associations of the country It also took the position that: that they take action looking toward a delay of the natter." (Report of Postal Savings Bank Committee, Proceedings, 1910.) "the whole project for deposit insurance - - e should be reconsidered . and # - reiterates its conviction that The Hretton Woods proposals are not the first the Bankers Associ- the postponement of the first phase of the project is of the ation commend in principle, but object to in methods and procedures. first importance. (Proceedings, 1933, P. 36) It favored The action taken by the Association in connection with the various *the alzo and mat of the provisions of the Class Bill, currency reforms furnishes the most striking illustration of its tech- but is opposed to the new insurance feature that has been nique in delaying legislative action. The President of the Association incorporated in 15." (The American Banker, Magn 17, 1933, P+ 1). in his annual cassage to the convention in 1911 stated: (a) Preference for Self-Regulation *It 1a almost inconceivable that bankers should have taken thirty-seven years in coming to some solution satis- B. 0. Page, Chairman, Committee on Mortgage Trusteeships of the factory to themselves" (Proceedings, 1911, P+ 59-60). Trust Division of the American Banking Association, Bankers Trust Company of New York, testifying at Hearings before the Subcommittee and The Association sought to minimise the need for the Banking Act the Committee on Banking and Currency, Senate, 76th Congress, 1st Seas. of 1935: on S. 47% said: "It is not our opinion that an emergency existe which makes it imediately necessary to have this legislation. (Statement of the President, Hearings before a Subcommittee of the Committee on Banking and Currency, U. S. Senate, 74th Cong. lot Sees., on 3. 1715 and H.R. 7617, at 515), Regraded Unclassified PRECISION TRADE MARK MICROSTAT NA. L PAY. OH, MICROFILM ROLL NO. 22 - 10 - - 9 (Bankers Magazine, Feb. 1898, P. 277). In 1908 it was resolved "As I stated in FOR testimony on the bill in the previous session of Congress, trust institutions do not welcome Federal "That the American Bankers Association condenna AS unwise and regulatory legislation of this type. The American Bankers hurtful all propositions to establish Postal Savings Banks", Association does not believe that the bill is necessary. It (Proceedings, 1908, P. 304). would have preferred to continue its efforts to bring about & satisfactory system of voluntary control, sinilar to that now A. spokeman for the American Bankers Association stated with respect in use in connection with personal trusts, and throughout the to the Federal Reserve Act that "unless the proposed regional reserve committee's discussion of the subject I have so indicated to states vas radically changed, its failure in actual operation would be as certain as that of a central bank from a. political point of view," the Securities and Exchange Commission. (Anerican Banker, Sept. 6, 1913). In the annual adresse of the First Vice-President of the American Bankers Association (1913) at pp. 64-65, it was stated thats A resolution passed in 1908 opposed any arbitrary plan looking to the mutual guaranty of deposits: "No are loath to believe that the integrity and the patriotism of tankers are regarded with suspicion by our "believing it to be impractical, unsound, economics, placing lamakers) or that it is believed that bankers are not to be a tool in the handa of the unscrupulous and inexperienced for trusted in the management of their - business through which reckless banking, and knowing further that such a law would weakeng the needa of the comerce of the country have been so ably our banking system and jeopardize the interest of the people." (roceeding 1908, p. 286). served in the past; or that it is believed that banking should be more restricted than other classes of business, except as to supervision; or that the experience of bankers in their Fifteen years later the Association was still of the same opinion: chosen profession should not be of value in the preparation of a new law; or that in the purmit of politics the best thought **The obvious injustice of penalizing good banking for the of the country on so important a problem will not be given fair protection of bad banking, of hasarding the funds of sound institutions to cover the losses of the unsound, must be clear consideration. to any one who will give this matter impartial consideration. "It 10 hoped, then, that the final results obtained will It 1a entirely possible that the unwarranted burden which this be such as will permit bankers to retain their self-respect would place on good banks might threaten the stability of the in the control of their or property and to transact business entire banking structure. It in an impracticable scheme to under conditions at least se favorable as is provided for salvage incompetency and failure in others that might imperil the State institutions, through which so large a percentage of very existence of sound and well managed institutions'.' (State- the business of the country is now satisfactorily handled. ment of President American Bankers Association, The American Banker, May 17, 1933, P. 1). "." (Proceedings, 1913, PP. 64-65) The American Bankers Association disapproved of the Class After the enactment of the Soldiers' and Sailors' Civil Relief Act, Steagall bill, which becare the Federal Reserve Act because it did not the Association feared that lending institutions would be practically embody the principle of self-regulations (Part : above). Para Credit helpless when a mortgager would become a member of the arred forces. legislation has been disapproved because it involves the establishment, (Froceedings, 1942, P. 169). However, the following year, it continuance, or enlargement of federal credit facilities or the use was reported that less than one per cent of the total number of loans of boards upon which bankers are not fully represented. (See Hearings outstanding were delinquent because of the privileges granted by the Act. (Proceedings, A.B.A. 1943, Px 20). before the Committee on Agriculture on H.R. 4384, 78th Come. 24 Sesa. (1944) (4) Predictions of Undestrable Results да early as 1898 the Association predicted that the establishment of postal savings banks in this country would be productive of such evil and lead to gross extravagance on the part of the Covernment. Regraded Unclassified RECISION TRADE MARK MICROSTAT/ MICROFILM BOLL NO 24 - 11 - - 10A - The Association has ever been on the alart to preserve and safeguard the interests of the banking fraternity. (e) Protection and Awareness of Banking Interesta *From time to time it is to be expected that changes A past President of the American Bankers Association advocated will be made in the (Postal Savings Bank) law and it should the following legislative policy: be the self-imposed task of this Section to see that these changes are not inimical to the interests of its constituents; "For the protection of the interests over which we are it is wall within our provinces - to have a hand in shaping custodians, it 18 one of the duties imposed upon us, which future legislation and in resisting as far as we may the en- should by no means be neglected, to defend ourselves and our croachments of paternalism." (Report of Committee en Postal business from those who pander to the multitudes for selfish Savings, Proceedings, 1914, P+ 175). ends, and who seek to may the people by vain-glorious oratory in their appeals to the prejudices of the people, whose suffrage, No must as all times keep a watchful eye upon the con- rather than whose welfare, they earnestly seek. (Proceedings, stantly recurring efforts to amend the Postal Savings Law. We 1908, P. 42) should be broad enough to cooperate in making any changes for the comon good, but should carefully guard the interesta we represent from governmental encroachment." (Proceedings, 1915, P. 181). ****1 successful result was obtained in connection with the Philippine Bill. # . An finally passed it provides for a more autonomous Government of the Philippines, but the threatened weakening of the security of American investments has been entirely removed and the holders of Philippine bonds are safe. In procur- ing this result our Committee were without doubt, very ably assisted by the representatives of millions of dollars of Philippine Rail- way bonds, and by large business interests that would have suffered by the termination of business relations existing between this country and the Philippines. - (Report of the Comittee on Federal Legislation, Proceedings, 1916, P+ 126). In recent years, the American Bankers Association has expressed the matter somethat differently. Thus, for example, in the 1935 state- ment of position on socialized credit and government subsidized credit, it stated that "The American Bankers Association will continue to present its position on these matters [1.0. credit by governmental agencies] before appropriate administrative agencies of the Government and before committees of Congress in an effort to secure the relief which is not only reasonable and proper but which is as much in the public interest and in the interest of farmers as it is in the interest of chartered banking. Regraded Unclassified PRECISION TRADE MARK MICROSTAT/ PAT. OFF. MICROFILM ROLL NO. 25 EXECUTIVE OFFICE OF THE PRESIDENT WAR REFUGEE BOARD # EXECUTIVE OFFICE OF THE PRESIDENT WAR REFUGEE BOARD INTER-OFFICE COMMUNICATION WASHINGTON 25, D.C. DATE March 10, 1948 oma OF THE TO Secretary Morgenthau EXECUTIVE DIRECTOR FROM Miss Hodel MAR 10 1945 General O'Dwyer has asked me to mivise you concerning his conference with Governor Lehman yesterday with respect to the care in Switzerland of refugees who are able to reach Svitzer- land from enemy territory. The UNRRA representatives (who, in addition to Governor Lehnan, included Abe Feller, General Counsel, and Fred Hoshler, My dear Mr. Secretary: Director of Displaced Persons) agreed that these refugees may be regarded as wards of UNRRA and that UNRHA could therefore I em pleased to send you nerewith a copy assume responsibility for their care while temporarily in Switzer- land. of the report of the War Refugee Board for the were However, because of politionl implications involved in an of February 26 to March 3, 1948. offer by UNRRA to the Swies Government, Governor Lehnan decided that the matter would have to be raised at least informally with Very truly yours, the British and Russian members of the UNRRA Political Committee. This will DE done immediately and the Board say expect to be nd- vised within a few days. If the Political Condittee agrees, UNRRA's offer will be to provide food and other relief supplies William O'Dwyer for 10,000 refugees in Switzerland by any of the following methods: (a) payment for supplies soquired in Switzerland, Executive Director (b) shipment of supplies to Switzerland, or (c) a guaranty to replace supplies made available by the Swiss. In addition to the foregoing, UNRRA has agreed to canvase at once the possibility of setting up A. soall reception center in France for refugees who might have to be evacuated quickly The Honorable, from Switzerland. The Secretary of the Treasury. Hodel Enclosure. Regraded Unclassified RECISION TRADE MARK MICROSTAT/ OFF, MICROFILM BOLL NO. Report of the War Refugee Board E - for the Week of February 25 to March 3. 1945 Representative MoClelland recently discussed with the chief Intererose delegate from Berlin une current SITUATION IN CONCENTRATION CANPS--DISTRIBUTION OF RELIEF PARCELS situation of Sputshaeftlinge and Jewish deportees in Germany, Pros information which ne octained during this Representative HoClelland reported that & writien request was discussion, it appears LARE the Germans are evacuating subditted to the President of the International Red Cross the insales of concentration e BAD# and regrouping then urging that visits of its delegates to places of detention in two general orens, one with nesdquarters or Lae conces- of all categories of "Shutzhaeftlinge" be increased to the tration carp of heuenghame near insure. the other with deadounriers at the Decided casp near Kunion. The Intercross greatest possible extent, that the number of its representatives in Germany be sugmented na substantially and DE rapidly as delegate reported that conditions of frightful overcrowling possible, and that its delegates De instructed to take every already exist in Seuengable and Dechau, where the internece acrive in 5. stote of utter exhaustion sfter days of traveling advantage of the mounting confusion within Germany in order on foot. Almost all of thes are in E very poor physical to mitigate the lot of all civilian detainees and to dissunde Gernan officials from last ninute extremes. consition Decruse of prolonged undernourisnment and mistrest- sent, and 6. crees may have died na a result of the evacuation de also the argent need of transporta= As en indication of the present situation, the reply from tion edulpment, expressing Live conviction sans inveluncie Intercross stressed that the German Government are recently old 00014 De given to toousands of Lanse persons If trucas informed it in writing that "for imperative ressons of national were available. IL were his opinion that, in view of the defense, visits to camps and places of detention where clien general 01610 or confusion ENJ the recently deponstrated detainees (Shutzhnertlinge) are confined are unfortunately at willinghess of 33 officiale to cooperate with Intercross, the present moment not feasible.' It vas stated that the 02 difficulty will DE encountered regarding permission to International Red Cross delegate in Berlin recently reported distribute relief paraels on the spot in seasualy caupe. being informed by headquarters of the Gernany security pollce that permission to visit concentration camps or slien detainees Representative McCletiand advenced une suggestion that must in each particular instance be secured from dinnler deliveries signt on made 10 the Honours region from or personally. Refugen Board stocks of nose 220, 000 parcels at Gothenburg and renewed nie recommendation that srrangements DE ande to Five new delegates of Intercross were expected to leave for provide trucks for delivery of percels from Switzerland to Germany within E. few days, and others are to be sent 68 8000 the Munion area to relieve tar pitical situation there. BE it can be arranged. From a practical view, is vas pointed out that the question of transportation in and «111 continue Le cabled our in London recomsending that, in to be the decisive problem, that scoess to camps by Intereross view of - extress urgenzy of extending additional wid delegates is dependent upon whether they bring sobething with to unassitilated persons in enemy-dontrolled doncentration then and whether they have gas and can still manage to travel CASO end in view of recent reports from the International on the roads (by truck), and that any number of freight care Red Cross Last more wid-sprend distribution can DE effectuated made available to Intercross say be, and probably will be, under the terms of the existing agreement, en additional found useless no a result of serial uonbardments of rail lines. 300,000 processes of three kilograss eean or foodstuffy DE The President of Intercross indicated his of the shipped [rom this country ay une var Refuger Board for urgency of the problem, stating that under the present distribution by the International Red Cross. The ESUANAY circumstances thousands of prisoners and deteiness can starve VII requested 60 refer the setter argently to une Relief within four days and that not a moment 1n to be vested. He Buo-Combities for Blocknde authoriza .100 to proceed vith expressed the view that by force of will and nerve Intereross we progras # 2 LAS earliest possible date. can do something to preserve the lives of these people If furnished with certain indispensable means for execution of the task, and that any results to be accured must DE through large- scale methods of action and sweeping decisions. Regraded Unclassified MICROFILM ROLL NO. PRECISION TRADE MARE MICROSTAT/ 30 23 CARLE TO MINISTRA JOHNSON um class, STOCKHOLD, SWEDEN, PROM WAR REFUNEE BOARD - 3 - Please deliver the following seasage to Frite Hollander, Congress NORWEG IAN OPERATIONS Comdittee, Postion 7306, Stockholm, from Dart Grossman, World Jewish Congress: Our and relief operations conducted in Norway from Sweden under Legation in Stockholm cabled & report of the resoue QUOTE Findly have foodparcels forwarded immediately follow- supervision of the Board during January. Through ing Bergenbelsen immates; Mernatein, Mrs. Henriette; Biologlowski, licensed the and other channels, 35,000 kilograms of food, Solf, wife and child; Cohn, Dr. Hilda; Benedict (orphans barrack); kilograms of clothing, 1,460 pairs of shoes, other and a Outtatein, Sonja, mother, father; Moch, Dr.: Dessau, Dr. San, wife 2,200 considerable quantity of additional clothing and (nee Colde) child; Druyf, Abrahan, "argaretha (nee Schelvis), Arnold, articles were sent into Norway. In the same period, an the tilly (nee van Embden); Floersheim, Lise (Dee Hoeller), Mohael) Mirschfeldt, Det, Betty (nee Zann); moller, Aribert, Gertrude, estimated evacuation operations. 1,100 routes Representative refugees established were Olsen brought in connection strongly to Sweden recommended with operations over these Simon, Bertaj Lovy, Leonard; Lion, Mrs. Beatrice (nee Strassburger); Lowenberg, Lucie, Schaunberg, Ernst, Certeud, Tord, Schenkolewsicy, Isase, Clara, Virian, losses; van Tijn, Benjamin, Behje (nee Caos- that view of the increasingly critical :ituation in Norway arrangements be made to continue these linski); de Price, Aaron, Reina (tate Spier). UNQUOTE with in more and more persons being forced into hiding because they are hunted by the Gestapo. THIS IS WELH STOCKHOLM CAREE NO. 324 EVACUATIONS FROM YUGOSLAVIA Anbassador Kirk cabled us from Italy of the arrival been at February 28 of 101 Jewish refugees who had the Bari evacuated on from Topusko. The physical condition was of remainder of the group of 107 whose evacuation recounended van such that they could not be removed. These few are now in the Split area where they are receiving proper attention. LATIN-AMERICAN PASSPORT HOLDERS DEPORTED FROM VITTEL Our additional information concerning the whereabouts the Embassy in Madrid reported that, following submission of persons Ministry of Foreign Affairs has advised the of removed from the internment camp at Vittel, it of Spanish of the data in question to the Spanish Anbassador transmission in Berlin with an indication of the interest of the Spanish Government in this matter. belliam Orger William O'Dwyer 1,30 p.m. Executive Director March 10, 1945 Regraded Unclassified MARK MICROSTAT/ MICROFILM ROLL NO. PRECISION TRADE 31 CARLE TO HARRISON AND BRS, PHOM WILLIAM WAR REPUIRE ROARD Reference Department's No. 819 of February 23, 1945. Since my trip to Switzerland has been delayed for the time being, I have decided to send Herbert Kataki to Switzerland temporarily to assist Itr. MeClelland in developing program approved by Board members at the meeting on February 20, Mr. Zataki has just returned from Askara, Tarkey, where* he was Special Representative of the Board, and 10 expected to leave United States for Switzerland very shortly. $ THIS IS WH9 RETO: CARLE NO. us 1:30 p.m. March 10, 1945 RECISION MICROSTAT no. W. 1. PAT. ON, MICROFILM BOLL NO. TRADE MARK L0-502 Paris Distribution of true reading only by special Dated March 10, 1945 arrangement. #) Rec'd 10:08 Palla, 11th Secretary of Rate, Washington. 1152, March 10, 10 Dalla Following in a close paraphrase of - produce accepted from Leon lubowitski, World Jewish Congress, for transmission to the -epartment for the latter's decision regarding armani conveyance in whole or in part to LA FAP lisfuges Board for Doctors Time and Golnan, 1834, Browney, Sew York City. Since arrival Deneva, Endeavored obtain imediate direct talks betanna appropriate German authorities, Sales Covernment and International lied Cross recarding grand scale release and regatriation of civilian detainess and featter action until their release. I WAS received by Ven statem, President of the Confeder- ation, and Inco Rekhardt two times. I conferred with namerous personalities and brought about simultaneous representations to the various National fied Cross delegations. I can advise you in confidence that Burklunit, despite Ma appointment as Swins Idadster to Trance, 18 processing #000 to confer with Minder. is protecting nower Ewise sindater, Darl, is sinul- taneously asking for interview with Minder, I have assignations of Burkhardt and Steiger that the maker of refugees admitted into Switzerland will not be limited. Gernany has agreed ta principle, I understand, to repairiate unmeployed civilian populations according to rationalities and that first nationality has already been agreed upon. Hurkhardt expects, with regard to Terman Jewn, to cet then out as International Fed Cross protognes. It is at Tueback that civilians in northern areas are to be contentrated and the sending of a ship requested of the Dedish Red Cross. Prom the southern regions evacuation 18 expected to be done partly by Allied Army trucks on returning from carrying food to war prisoners. SEALP unfortunately prohibite using trucks for carrying food to other than was prisoners. ininterrupted contact of lar liefuges Hoard and our European offices La required on this dituation. Before releasing this ⑉ secret ons Paris January 20, 1945, Cernary political report from Anteerland No. 0,398 S/S. If not imediately available contract Hauck, office of stratagic Services, Teshington, CAPPIER Regraded Unclassified PRECISION TRADE MARK MICROSTAT ass. PAT. OFF. MICROFILM ROLL NO. VOK March 10, 1945 Distribution of true reading only by special 7 p.m. arrangement. (sucurt 1) AMERICATION HERN 1014 The following to Harrison and MoClelland from O'Dayer is TRP 440. Reference Department's No. 819 of February 23, 1945. Since my trip to Switzerland has been delayed for the time being, I have decided to send Hertert Kataki to Switzerland temporarily to assist M. MoClelland in developing program approved by Hoard muters at the neeting on February 20. 18". Kataki = has just returned from Ankara, Turkey, where he was Special Representative of the Board, and 10 expected to leave United States for Switserland very shortly. order ACTING (CHI) Regraded U RECISION TRADE MARK MICROSTAT MICROFILM BOLL NO. 34 CARLE TO AMERICAN EVHASST, PARIS, FROM THE WAR REFUTES BOARD Please deliver the following message to Joseph Schwarts from N. A. Leavitt of Acerican Jewish Juint Distribution Comittee; QUOTE VITELES AVAITABLE DAT YIRST FOR VERSIAS ASSIGNMENT. HS MISS not PREPARENT POST ANT PARTICULAR PLACE BUT WE ADVISED HIV THAT ASSIGNATES COMPLETELY OTION TOUR JUIS- DICTION, CARL: PCP. MAT COUNTRY OF COUNTRIES VIS SHOULD APPLY FOR PASSPORT VALIDATIONS IN VIND DIFFICULTIES SECURITY VIRAS VALIDATIONS. PUBLIC LIBBON POST AND NW CONCUR COMPLETELY nos 1087 SUITABLE ASSIGNMENT FOR HTM THEREOF RELEASING HAROLD 7:05 FOR PHANCE STITIDUAND on OTHER POSTS DEPENDENT YOUR MEXOS, PLAU? ISAVING FOR ALCIERS NEXT DAYS. MIDART ANAITING FRENCH VISA FLEASE EXPEDITE, JOBSPH MAXIS AND PORTYSIX BUSINESSEN HARIS PAYORABLE IMPRESSION INTELLIGHT BUT to SOCIAL WRE EXPERIENCE a CONTACTS 07:02 THAN USUAL PETERATION AND JA VILUNTER PARTICIPATION COMPATORS. READY VOLUNTER SERVICES CIG YEAR. ADVISE YOU CASI UBS SUCH PERSONNEL. inquors 4:40 p.m. tarch 10, 1945 Unclassified PRECISION TRADE MARK MICROSTAT MICROFILM BOLL NO. 36 35 CARES 20 AMERICANT LISBON, FROM THE TAX REPUBLE BOARD CABLE 20 AIRICAN LEGATION, BERN, FOR MODIALLAND, FROM THE MAR whole BOLID Please deliver the following seconce to Herold Trobe from Please deliver the following to Saly layer from 4. &. Leavilt - &. Leavits of Amrican Jewish Joint Distribution Consitiee: of American Jewish Joint Distribution Condittoes QUOTE BASIS SCHARTZ APPROVED APPROPRIATIONS FOR OILY SIGIAR previous GRANTS EXCEPT PRANCE $200.000 (10% No A.C. HATURALLY Value AMXIOUS DIAS STATE de MADE 20 FOLUD 200,000 VIA STITEMAND $900,000 STOP ILLSOUE MAXIMARE main JINIS. ASSUME TOU IN FULL WITH CORRECTION VISA INCULAR APPROPRIATIONS TOTAL- THIS AND WILL HELP MAXI-SIM EXTRAT 2:18 process. UNQUOTE 200,000 FIRST QUARTER & CANCELLED $360,000 circume GRANZ APPROVED 1944 ADVISE RESUIX. INCREM APPLY LICENSE JAIDARY FEBRUARY APPROPRIATIONS GRENCE la REQUIRE HATE COMMITTEE OR LOIVIDUE PLEASE ADVISE. ASST E you KEEPING LIDIR CURRENTLY ADVISED. UNQUIDE THIS IS WHIS Bizur CABLE NO. 441 2425 IS vites CARES JO. 155 3:30 P. =. March 10, 1945 3:30 P. =. March 10, 1965 RBH: 3/8/45 RRH: 3/10/45 Regraded Unclassified 37 38 CABLE 20 AMBASSADOR STEINHARIS, ABRARA, FOR ms. HENDERSON, YROM VAR REFUGEE BOARD CASTS 20 AMERICAN LEGATION, BERN, FOR MOOLELLAND, FROM NAME REFUGES BOARD Hrs. Henderson is ordered to return to the United States Please deliver the following mediare to Issac Sternbuch, Montrewx, leaving Turkey by the and of March, from the Vasd Mehatzala Committee: QUOTE DISCUSSED MATOR WITH JOINT DISTRIBUTION COMMITTEE. The Embasy is authorized to arrange transportation by air THEY CONSENTED INFORTANCE REALIZATION YOUR wyons RESOUR for Mrs. Henderson from Ankara to the United States on a rein- JESS TO THAT PROMISED THE S. MAYER. UNQUOTE burgable bacis. Please make necessary ticket arrangements as Cairo Legation to facilitate return, Caire also to be reisbursed. THIS IS inco BERA CABLE NO. 42 THIS IS VRJ ASKARA CARLE NO. 145 3:30 p. n. March 10, 1945 RRH: 3/9/45 2:00 p.m. Narch 10, 1940 Regraded Unclassifie ROLL NO. 39 CABLE TO AMERICANT ISONSION, suppor, FOR MODIALLAND, FROM WAR REFUGEE BOARD Please deliver the following to Leon Kubowitaki, 37 Cust Wilson, Geneya, from Eurt Grossman: 0.0% ARRIVALS REPORT STARVATION DANGER FOR INVATES 2020. FOOD PARCELS ESSENTIAL THEIR EXISTENCE, 2.100GH MAINT REFORTED NOT 20 ARRIVE. SUGGESTED IHC WASHINGTON SECURE DELIVERY GUARANTEE GENERAL GOVERNMENT. INQUIRE THIS IS MRD BERN CARLE no. 444 4140 P. =. March 10, 1945 RSR: 3/8/45 PRECISION TRADE MARK MICROSTAT REG. PAT. OFF. MICROFILM ROLL NO. 40 41 (released for distribution March 14, 1945) CARD as AMERICANT Page via 44% WILL DOARD PARAPHRASE OF TELEGRAM RECEIVED FROM: American Legation, Bern Flore doliver the fallowing to liarold Trobe from TO: 4. Leavist of American Jowish Joint Distribution Conditions Secretary of State, Washington DATED: March 10, 1945 C/O/L DG SALANCE $16,000 2010, 161 AD RECEIVED MUMBER: 1534 POTALLO Applicationly $9,000. FOR EDICAL UTILIZE SUPPLIES REWAIN FOLUD CONFIDENTIAL more 25,000 AID YIRS 240ml 40200 LICENSE PROVIDES STATE have SUPPLIES SALVADORAN INTERESTS GERMANY. The Department did not instruct the Legation that all Salvadoran passporte which the Consulate issued in question should be forwarded to THIS IN to LISUO CARED D. 156 the Government of Salvador for its examination nor was such request made to the Swice Foreign Office, In corrective notice dated March 9, it is stated by the Poreign Office that it is possible the Foreign Office misinterpreted as request Legation's offer to transmit Salvadoran documente for verification to the Government of Salvador. In addition, the Foreign Office says this misinterpretation likely since 1% was understood that the Legation could only act as channel of communication and could not itself verify these documents. For completion file, Foreign Office notice will be forwarded in next pouch, 4140 the = March 10, 1965 HARRISON smills 3/10/45 Regraded Unclassified RECISION TRADE MARK MICROSTAT MICROFILM BOLL NO. 12 42 43 CORRECTION OF CASES 20 4D 7800 that HOARD PARAMINASE OF TELEBRAN RECEIVED de your 1354, March 2. here informs us that correspondente American Inbassy, London In this country are addressing their mil to the desegory 7 (repeat 2) rroup exchanimes as reilippeville ns follows: TO: Secretary of State, Mashington e/o Jean d'Are Refuree Camp DATED: Harch 7, 1945 Philippeville Alviers, Algeria NUMBER: 2353 Lint of chose exchangess who actually arrived at Pollippeville will reach you via aircrus. This DECRAGE was distributed to you March 8 AS No. 2354. Please note the correct number is 2353 and change your copies accordingly. a ACI - GATED 10. 446 DC/L:GPV 3-10-45 5100 F.W. Earch 10, 1945 3/9/45 Regraded Unclassified RECISION TRADE MARK MICROSTAT/ MICROFILM ROLL NO. 44 45 CARLE TO AIRINICAN LEGATION, FOR PROM THE HAR REFUSE BOARD CARTE TO AMERICAN LEGATION, STUCIOLE, 7.10 TAB REPUBLIC 30.70 Please deliver the following to Sane Clee c/o Relico, 1 Has Please deliver the following to Filel Storch, 200 7306, du thank, Geneys, from Abrahas Silberschein, Norld Jewish Congress: Stockhola, from Part 1. Decements quota THY SECURE PROTECTIVE DOCUMENTE FOR POLLOWING viasons AIRERT C.O. ARITVALS won 23 WAY 1862 VIVE MIX ETILIMER as UNIPEIDER 12 DATE: de B GREATIST FERRUARY 1875 NET TORK NOU STOP FLARA HOROWITZ BOZ vano 755 and YOU DATE ACTION 20 COZATA 26 APRIL 1862 IN 44 SUPERITOL GRAVIA ARTIUM OUSTAV SAPE DALIVER: 20 ADDLESS 8702 YOU HOROSITE 5 APRIL 1868 DIELITS SAIASTA NOT nassar S..DID VARIES ADDRESS - subjects VALI 7122 BORK 17 JUNE 1.80 HAULERNIJE WIFE EATJE VAII PLUS HER GOLLISKI 29 JAIMARY 1881 HOLDER NOT STOP CLAIRE 27 APRIL 1908 ANTWERF MARTIS PERLACEMER 17 MARCH 1928 JACQUES PERLICROS 19 AUGUST 1929 RALES PERI- BLACK 9 FEBRUARY 1931 AISTRIDAD JOV STOP DOCTOR LEON FOLAX 1 OCTOBER 1883 The JOBA POLAT INC. VCS 14 JANUARY 1887 ADDRESS vas 15 se ID. 325 DAUGHTER 2018 24 MAY 1922 DELIVERED NOV STOP DAVID LEVISSON VIFE Jurry DENISTER LEVISSON FOUR CSILDREN AGIS FIVE Seviel 0.00 ALL your DIVANT IN you STOP CHIEFRANCE HAX LOSES FREDIGA 9 APRIL INCL BIDAYST BUNGARY SON HAVISTER ARTISH PRINCIPAL 7 OCTOBER 1919 in STOP SFILL 35 AAROS DEVRIES 35 MOR STIP BETTE PATAS ELIAS 72 PROVESSOR de NATURALS 53 JACCIA HIS 47 JAGGOUS AMERICA SIXING POURTEEN man AND NM BTO2 sou 41 HARD SOLF 46 and JANE INA 205.726 UD MATER ATL 2011 tous SOLF 50 погендаш LOT MARY SICE BELA 11 ST 1873 2701 LOVARD ADDIT 26 2016 1900 ALEXATIVE SOUTH VALI SPIR 9 JAMARY 1907 CHARGES VETER CITA TONAR 1 JUSE 1927 AND 1929 100 3 DECEMBER 1931 ALL the mea. 9 STOP DIAD Brink 17 JAMARY 1902 any CURA S/DA 37, DEIFT CHICA INSURAND AND - AND SIX THANS até POLICY liest on - SIO₂ PRODUCT SER 12 1907 2705 you 1000 SULT JUN JUNE POLAT 31 1903 3:30 P. B. - VALID - DOBA 1931 not March 10, 1945 51% UNITA retur 27 OCTOBER 1905 FLZIONAS TOJOGSTAVIA wish 25 1015 ELIO CELO Dat STOP PRODUCTS ILL name 100 sure) o au DELIVED 10 CTILIC net state LITE 18 1895 The Charge HODA - RRH: 3/0/45 PO/MIN 25 OCTOBES 1899 LVA 24 ware 1920 SID - WINES 24 will 1877 _________________________ 4.10 - JACKS AID are ALL or B700 HALSO SIZOUP calleded NO OLGA as CHIRTY ND Regraded Unclassified PRECISION TRADE MARK MICROSTAT MICROFILM BOLL NO. 46 47 2 of Cable to linns (Dee, Deneva, from Abrahen Bilberschein, corld Jenish Courress: CARD 20 AUGHTGAT PARTS, 20 TAR BOARD QUOTE BRON Please deliver the following messure to Jeseph Schwarts RESPECTIVEM DOCTOR and JOR WIFE LA CHILDREN HOLD DEL AND BABI AGES POURTOFOUR man SIRVING ATD POSTAGEM from - de Lesvitt of American Jewish Joint Distribution Committee: BOUI BUDAPLST GYONE INDAPLOT RESPECTIVELY STOP FISCHER 38 WILL 36 YOUR для CHILDREN IV SECURITY SIGN FULDE WIFE JOHANNA ADIS 32 AND com CHILD BORN IN ADIS FURNER DETAILS - DECTIVED HEADY SATOSPATAR STORY TVELY SIOP R$ 55 10 APPROVIATIONS an The POR JARCH ONLY WHICH APPROVED STOP ARMIN SECTION SINE MANDIT are MIS POLITY240 LATE YOUR LICENSE STILLAD, a FOURTY AD BOUT not JAMOR STOP DOCTOR DETSO SENTER 30 VIVE 20 CHED STUF 0. DOLLARS HILL IN DUE COUNSE. 2115 2010 SCIENCITE 36 STUP LOVE 11 JANAO 1900 and and APPROPRIATION MOSED DOLLARS PLUS 0% 13 DECEMBER 1906 MAY e JULY 1933 13 3 VISABLE LIGAID BALANCE FLORIARI LATTER 28 MATCH 1927 not ALL BIOP LIAN 31 7.00 visit WAT DOLLARS FABRUARY 1902 404 are JOHN 23 220.54 D APTO no GILBERT STAND AUGUST 1898 The to 1880 and HOLLAND HOW AM STOV - AND 101 PAID or DR GOLDEN (O) L7. DOCUMENTS now THIS 15 en and GARDS JO, us 3:30 P. 1, Varch 10, 1945 4:40 P. n. March 10, 1945 2011: 3/9/45 RBH: 3/9/45 Regraded Unclassified RECISION TRADE MARK MICROSTAT/ MICROFILM ROLL NO. 48 CARLE 20 AMERICAN LIBARST, FARTS, FROM ne TAB and DOLD 49 Please deliver the following Lo Joseph Schwarts from - de Leavitt of Amrioan Jowish Joint Distribution Condittee: CARD 20 47.000 CONSULATE and FROM fall HAPUGE BOARD QUOTE a FOLLOWED TOUR DISTRICTIONS PAYMENT $300,000 reserve BANK ACCOUNT BANK HATTONAL De - NATIONAL a DL Juli's CASES LOUIVATION INCLIVED X Please deliver we Collowing missure La Lice Joint Distribution comm. unders Condittee in Jernaslen from - de Leavitt of American Jevish Joint Distribu- Um Conditteer QUOZE YOUR CAST. LISBON - ANVISE by INCLUDED LIBERATED 10015 CALICIA asto - POSSIBLE - SLIP COLUMITY COUNTE IF REGESSART SUGGEST YOU contact DOCTOR HOSPITAL STATISLATOR, HAS DUE CASH ACCOUNT CONTRIBUTIONS POR LOOS ADD orrer CITIES 3:30 p. m. March 10, 1945 R:3H: 3/8/45 3:30 P. 1. March 10, 1945 C RBH: 3/8/45 Regraded Unclassifie PRECISION TRADE MARK MICROSTAT/ MICROFILM BOLL NO. 50 51 CARLE 20 AMERICAN LIBASST, PARTS, FROM DUE DA ave HOWE CABLE 20 as, you FROM NAME BOARD deliver the following measure to Jonesh Schwarts Committee: from Jordan Gerhurd Congress tiemer, 37 Cust Wilson, Genera, from Rust Grossnan Rubowitaki of World Please doliver the following to Leon and de du Please Leavitt of American Jewish Joint Distribution UNIVERSAL us AVAILABLE ADDITIONAL - 1.100.00 VILLION EXPIRES FAMICS QUOD AS PREVIOUS massacrios you = ACCEPTY 510g INVESTOYE the INTERED AND LAST Lust AROS suon - Zip AROIT FIND OUT manager LEST - FLORA NAME AIRIA GEORGE SALE 11 MARCH SASTS QUESTIONABLE merium SHALL JOILI PARTY names 20 SOLDER SILESTA STOP BERLIN DEPORTED 3/4/43 PAOM ILLUS BANK 2001 7/7/1882 WHEREASOUTS UNCION JUNE YOU COLLECT CARE YOU WILLING 0701 DEPORTED EARLY 1% FROM DRANCT INVESTIGATE SUBMITTED CASE 102 REGETVED SURVIVORS HUNGARY other LIBER,IND COUNTRIES DETAILED LIST we LIST SURVIVORS PROVISED LONG NOIDLES 400, my INQUOTE STILL XIS 15 as PAID CARES JD, 443 4140 P+ n. March 10, 1945 4140 The m. March 10, 1945 MBH: 3/9/45 RESE: 3/10/45 Regraded Unclassified PRECISION TRADE MARK MICI SECRET COPY NO NOT TO BE 1.5 TRANSLITTED 52 OPTEL No 29 Information received up to 10 A.L. 10th Larch 1945. 1. SAVAL Here Waters 9th. An enem) force about 100 strong in landing craft carried out a raid en GRANVILLE (Gest of CHERBOLRO Feninsula). A U.S. patrol caft -hich intercepted two - enemy landing craft vas damaged and beached. After setting on firs soco coastors in the harbour and demolishing cranes enemy force Fithdree on arrival Allied infantry reinforcements. Withdrawal took place before auditional patrol vessels could reach area and sono Allied prisoners vere taken by enery forces. 9th/10th. (light) Allio6 patrols engaged E-Boats off DUTCH Coust but results not yot received. 2. LILITARY Western Front South Central Soctor: Rapid drives by U.S. armoured formations have split up large enemy pocket lest COBLENZ. Intest reports indicate on column driving up nest bank of river to out off remaining oncept this arca, and state nont thousands prisoners and nuch agapment taken. Further north All AGEF bridgehead xtond and now 11% miles -1dc and three niles doop, while (If stor jart of BONE 1s in our hands, Northern Sectork U.K. and Canadian troops have closed up to read after bitter fighting and latter tron nor cloar of study. Bastern Iront Central Cootor: on right flunk good progress made in North 1: Direction *Lore STOLP, percrful G-roon dufunel stronghold, captur LB also STOLPLUNDE on coast. Fighting continues in diruction STETTIN which sined to clear -note from Bustorn bank River ODER, Southern Soctor: Germans continue to attack -1th large tank forces K.D. LAME BALATON in attempt to break through to DANUBE and Russiand report 70 Curran tanks destroyed. Burea Control Scotor: Heavy fighting continues Northorn outskirts LANDALAY. Northern Sector: Chincee trocja advancing on troad front have occupied MALHSAN (40 niles West LASHIO). 3 AIR OPERATIONS Wratern Pront 8th/9th. (Night) wireraft 7E2, despatch E (four missing), 312 chipyards HALBURG (837 tons) 274 KASSEL (1136 tens) 39 BERLIN, 37 svamining, 120 bother support and other missions. Halifaxes attacked shipping SEACESEAR, danaging dostroyer and 3,000 ton ship. 9th. Specrted Luncusters 157 (one missing) dropped 793 tons through cloud on Benzel plant in RUHR. Escorted U.S. heavy bonbors 1011 (9 outstanding) dropped 2044 tons torgots must and F.O. GLRLANY Including six railway contr 5 (1935 tonsi +ith good results. SHAEF (Air) Benber 715 (the missing) dropped 112E tens railway cuntros and supply deports cast of RHINE, while 2779 fighter bechare and fightors (12 missing) operated battle front dostroying Co coconotivos, 1000 road and rail vehicles and inflicting unony posualties in combat 22:3:10. 9th/10th Accber Command dospatched 155 aircraft -ithout loss including 92 to Burlin, Lefitstranean Cth. of 848 aircraft despatched 553 heavy beuburs dropped 1074 tons targetà HUNGAI." ITALY including railray controls HEGYSHALON (17 files south BRATISLAVIA)and VERONA +Ith COOD results, Tactical aircraft 756 attacked communication and other targots SOATH ITALY and 1000812VIA. Burra 7th. Allied huavy & codium beabors ¿, dropped 260 tons r.11vays and jotties SOUTH BUTLA. Lockets 9th. three incidents. 9th/10th. five incidents. Regraded Unclassified RECISION MARK MICROSTAT/ MICROFILM BOLL NO. DEPARTMENT 53 OF INCOMING DIVISION OF 54 STATE CENTRAL SERVICES TELEGRAM TELEGRAPH SECTION -2-/401, March 11, 9 Gells from Chungking largely does not have on hand at rate of 350,000 CC-606 Chungking ounces per month or United States $105,000,000 per This telegrem must be persphreard before bring Deted March 11, 1915 ennum, receipts from gold salts, including compulsory communicated to anyone other than a Government Rec'd 2:00 Palling 12th purchases of treasury certificates, total bortly Agency. (SECRET 0) 25% of current monthly deficit. And this deficit is 412 Secretory of State, not going to diminish during course of year. There- MAR 1 3 1945 Weshington. white fore, if Government wishto to maintain in current LIAISON OFFICE ratio of receipts from gold soles to monthly deficit For security reasons the text of this cossage must 401, March 11, 9 can. TO THE SECRETARY OF TREASURY FROM ADIER (POR it will either have to increase price of gold or in- WARNING to closely guarded. orense gold soles or both, TREASURY ONLY.) Three. The reckless Government conduct of its Present gold situntion. gold sales policy con only be described 0.8 "frensied One. Government is now relying on onles of cold financt". and six month gold deposits 0.8 main source of (A) It has been and is stlling cold nt an revenue. Recripts from such soles in January one obsurdly unsconomie price. The official pretex that February were CN 14 billion (plus 20% of that sun from price cannot be reised without on adequate supply on compulsory purcheate of three year trensury certificates hand dota not hold water. While official prior of gold by gold purchasers), which 18 substanticlly in EXCESS of has been maintained, blook market price has ristn to receipts from texation in same period. It will be CN dollars 39,500 per ounce; also witness the heavy noted that less than 25% of receipts from Cold sales purchase of six month gold deposits at End of February were from spot solds and that by for the larger part due to rumor that official price WOR to be raistd at were from six month Cold deposits. Contral bank's beginning of March, Official claim that reising price short position on gold in now approximatrly one of gold would push up general priots still further million cunces. cannot be taken striously at c. time when priors are Two. While Government is now selling cole it lorgely skyrockiting Regraded Unclassified 55 -3-9401, March 11, 9 Calla from Chungking skyrockating in any COSE. (B) It is dissipating Chinc's fortign exchange casta, which sht will bodly need at wor's end, et current rate of United States $150,000,000 per annum without significently affecting economic situntion. In foot, since inflation has now entered snowbell phose, future solts of cold ct current rate will have even smallar effects 08 broke on inflation. (c) Part of the gold is finding its way into occupied China. ATCHESON JT RECISION TRADE MARK MI 56 COPY NO. 4 NOT TO BL RETRANSWITTED SECRET OPTEL NO. 80 Inf mation received up to 10 n.K. 11th March, 1945 EnVoL. 1. Hume Waters. 10th A trowler W15 terpodned and sunk by U-Beat off Mintrose. 2. North atlantic. 10th. admirulty Floating dick which was being t.we] to Gibroltor fountered in Bay of Biscoy after persistent full wanther. MILITARY 3. western Front. (South Centrol Sector) 3rd and 1st U.S. araies have joined up N.W. Coblenz and are clasing up to bank f Rhine between Neuwied and Sinzig. Further north, Renagon bridgehes! strengthone! and extended against stiffoning opposition. (N.rth Contral System) 9th U.S. Army new within 3 miles Wasol. (N rthern secter) Gorman resistance apposite Canadian First army reported rapidly decreasing. 4. Eastern Fr it. (Contral Sector) Further large advances made t wares Poltic West and N.W. of Dannie which town als: being fr.= S... and S.E. Couther west, small advance tale whele Stettin fr - 5.2. mile further s uth, Garmant clain t. have checked Russian attacks against narrowed bridgehood at Austrin. (Suthern Sector). In Northorn Hungery Russians admit slight Gerean guins N.E. Lake Boloton. 5. Burga, (Central Sector) Henvy fighting entinues northern utskirts Manialay, while ur troops also in contact with enemy 19 siles N.E. of city, AIR, 6. Western Erans. 11th. Escorted Lone-sters 153 dropped 755 tons through cloud on synthetic 111 plant Buer (N.L. Essen) with un bserved results. Recorted U.S. hanvy bombers 1,332 (cutstanding fighters 4) dropped 2,875 tons by Pathfinder tochnique on aleven railway centros and two railway visducts North and East of Ruhr including Fortund (1,062 tons). SHAEF(,1r)- Boobers 438 dropped 380 tons railway centres east of Rhine and minly Central Sector, while fighters and fighter bembers 1,132 (missing 6) operated bittle area destroying 30 loc notives and 160 M.T. Spitfires +3 dropped al tins on two rocket sites and communio in Hugue area. 10/11th(Night). 3 nber Command despatched aircraft 112 (withiut loss) including 60 Wesquitoes Berlin. 7. Moditerrongen Front. oth. Escorted heavy bombers 371 (missing b) dropped 758 tons by Pathfinder technique on five railway targets Austrin and Yugeslavis including Graz(630 tons) while tacticol aircraft 932 (missing 4) attacked communications Branner route and Northern Itsly. -1- Regraded Unclassified PRECISION TRADE MARK MI 57 b. Burma. 8th. Liberators, 12 destroyed two bridges Burma/Siam railway south of Moulmein. HOME SECURITY. (Up to 7 A.M. 11th) 9. Rockuts. 9th one further incident reported for period already covered. 10th two incidents reported. 10th/11th (night). One incident reported. $ $ ded PRECISION TRADE MARK MICROSTAT/ MICROFILM ROLL NO. 12" c o 59 Y LEGATION OF THE UNITED STATES OF AMERICA 548/ICO/MET Stockholm, Sweden March 12, 1945 TO: Mrs. Klotz - 3400 58 Brigadier General William O'Dwyer Executive Director C War Refugee Board The attached translation Washington, D. C. of a Swedish newspaper article on Wallenberg's Dear General O'Dwyer: activities in Hungary may be of interest to Secretary In accordance with our recent cable there 16 enclosed Morgenthau. = a translation of the article which appeared in Dagens F. Hodel Nyheter regarding the activities of the Swedish representa- tive in Budapest in behalf of the Jews. Sincerely yours, Iver C. Olsen Iver C. Olsen Special Attache for War Refugee Board Attachment - 1 Regraded Unclassified RECISION TRADE MARK MICROSTAT/ PAT. ON. MICROFILM BOLL NO. 2 SOURCE: Dagens Nyheter, March 6, 1945. conference he returned with Szalasy's written assurance that the Swediah protective passporte were valid and that the Swedish Achievements in Rungary authorities were to respect them. Race With Jee Train to the Border. Swedish Houses Were Given Extraterritorial Rights. Many thousand Jews and other preys of persecution in Budapest Nothing was impossible for Wallenberg. During the worst say to this day: "The Jews in Warsaw defended themselves, period, anonymous letters in which he was threatened with the Danish Jews were protected by King Christian, the Dutch death, were sent to him, stones were thrown at his car, and Jews were protected by the population itself, but we have been everything was done to try to prevent his from seeing his saved by the Breden." proteges: armed gansters were sent out to pursue him, but nothing could make his give up. He succeeded in making the Hungarian Winistry of Foreign He who tells us this is n. Hungarian who arrived in Affairs recognize the Hungarien Jews who had Swedish protective Stockholm some weeks ago after a fantastic journey through passporte ne foreign citizens with rights AS such. Moreover, Germany: he can not find the words to express his gratitude Wallenberg succeeded in arranging that these Jews, almost 5,000 for the spirit of self-eacrifice, the indefatigeblencss and were billeted in so-called Swedish Houses, These houses were the heroic courage shown by the entire Swedish Lecation In given extratorritorial rights and enjoyed every possible pro- Hudnpest and private Sweden in that city, when the persecutions tection. None of these Jews had to carry the obligatory David were n° their worst. There are two names which the Hungarians Star. All this happened, our source continues, in o city put at the top of the list: the Head of the Legation's Section where the Gestapo and the "Pilkors Men* behaved with the ut- B, Attache Raoul Wallenberg, and the Swedish "Lector" at the most brutality. In the middle of the Raoul Wallenberg Budspest University, Waldemar Langlet. The detailed description would fetch people from the prisons who had been arrested be gives of their achievements justifice this reputation. despite their protective passports, in the darkest of nights he would drive to the Swedish Houses with medicines or help It may be recalled that Admiral Horthy at one time, after for the sick. For there vas one restriction: Jewa living in the personal letter from King Gustav, agreed that Swedish the Swedtsh Roused were not allowed to leave them. Everything protective passporte might be issued for some thousand they needed had to be sent to them, and the Legation THE Hungarian Jews, who were connected with Sweden through relatives indefatigable in this activity. or business connections. "None Lenves This Place Ag Long As I Live." Our source tells us that however extensive the persecu- tion of Jews was under the Szotai Government, there nevertheless Once Attache Wallenberg received a mesenge that the occurred no executions in Budspest itself, no deportations, and Hungerian Military Authorities intended to take some of the those who were in possession of Swedish passporte were not inhabitants of the Swedish Houses for labor service. He affected by any nessures. The real atrocities started when immediately went to the Military Staff, but the lengthy Scalesy came into power, then protective passports did not negotiations seemed futile. The town's Commandant said: "If your help. The Swedish Legation's Section B, however, immediately proteges do not report, they will be considered deserters and started action to protect the legal rights but net with hard hung immediately." resistance. One night the Minister of Internal Affairs personally announced on the air that protective passporte no Wallenberg then had to return to the "Swedish Quarter" longer were valid, news which caused a tremendous panio among without having achieved anything. There be vas set with the all those who had papers of this type. news that one patrol already had arrived to fetch the sen who could work. Wallenberg reproached his people for having let Raoul Wallenberg, however, took the bull by the horne: he anyone intrude on extraterritorial premises. He wes told that went to Sealasy personally and was net with the question, why the patrol was armed, but this did not prevent his from going up were the Swedee interested in Hungarian Jess. Attache Wallen- berg's answer became n. serson on humanity and after one hour's Regraded Unclassified MICROSTAT/ MICROFILM BOLL NO. RECISION TRADE MARK - 3 4. to the leader of the patrol and shouting so that the whole quarter could hear 121 Wallenberg did not besitate, he at once went to Szalasy. The Intter said he know nothing about the provocation, and the "This 10 Swedish territory! You have nothing to do result WAS that the leaflets were never thrown out. here!" Langlet's Passporte Saved 2,000 Lives. "I have orders to fetch from this place all the men who can work*, was the answer. We mentioned above that the Swedish Legation could only issue A certain number of protective passporte, and only to such *None will leave this place. If you try to take anyone persons who fulfilled fixed conditions. The Swedish "Lector" at away you will have to answer to ne. As long se I live none the University, the 70 year old Waldemar Langlet, however, will be taken out of here. First you will have to shoot DO." succeeded in seving many lives through his neasures no repre- sentative of the 9wedish Red Cross. He issued special protective The soldiers did not quite know what to do, and gradually letters with texta printed in gold print in Hungarian, German, left the place. Later the Connendant asked Wallenberg for . French and Russian, and with photos, signatures, dates, stamps conference, a request he at once followed. The negotiations and seals, so that they acquired an extraordinary "impressiveness". lasted one hour, after which Wallenberg returned with e paper These letters anved many from disappearing in concentration from the Connandant saying that Jews under Swedish protection sere campa, from loosing all their belongings, yes even from loosing exempted from labor service. their lives. These letters, our source says, will for a long time to come, reasin some of the most beautiful documents of Racing With A Deportation Train. human kindness. At least 2,000 people, among then children down to 3 and 4 years of age, were saved in this manner. The sabe night the Swedish Attache received another alaruing report: eleven persons with Swedish protective pass- Finally, our source stresses that the Swedish Legation did ports had been arrested by the Gestapo, and what WAS worse, had not limit its help to Jews alone, it helped wherever it already been thrown into a railway carriage. Not a second possibly could. The atrocities under the *Pilkors Men* regine, could be lost. Wallenberg raced to the railway station in his however, were all too many. Gangeters harried in the streets, car, but the train with the Jess had already left the station. stole, burnt, murdered and plundered. As A. whole, the police The destination was Vienna. behaved all right - there were exceptions, but other authorities were no much worse. In his car, Wallenberg then pursued the train and caught up with it at a station near the Derman border. The train made The Catholic nuns and monks did much besides hiding a stop there and Wallenberg succeeded in getting hold of the thousands of the persecuted in the cloisters. In one nun's connander; ten minutes later his people were let out of the cloister A secret printworks was installed for the printing of sealed carriages. The others, who could not be saved, had to identification papers. At one time when the Stalasy men demand- go on to Geruan territory in the dirty, overfilled carriages. ed n. million pengo for the release of some Jews, the Benedictine and the Cistercian monks contributed one half of the amount. Just when the Russian troops wore entering the suburbs of Budapest, an old can entered the Consulate, The nan said he was working at the Printer's Athaeneum, one of the largest firus of this kind in Hungary, which by that time had been confiscated. He showed Wallenberg a pulled proof of 8 proclamation in which *workers, Jews and suppressed" were encouraged to rise against the Germans and the "Pilkors Men" and use their weapons. The typographer told Wallenberg that 300,000 copies of the leaflet were to be printed and distributed by aeroplane AS 5. provocation. The 1dea was to bring about a revolt in order to arrest di who were found with weapons in hand. Regraded Unclassified PRECISION TRADE MARK ) House 64 65 TREASURY DEPARTMENT - 2 INTER OFFICE COMMUNICATION regarded as too complex for treatment in the brief time available) WAS not discussed. There was general agreement DATE March 12, 1945 that 'notive Nazis' should be removed from all positions of TOP SECRET importance and that they should be punished, but no decisions were taken nor was there much discussion of the subject. TO Secretary Morgenthau (Urgent) There WRI no tendency at any time to exonerate the German nation from precipitating the war." FROM Mr. Coe F.U. Restitution and Reparation More on Yalta "There is a provision in the agreement on reparation that This is a aummary of the Yalta declaions on Germary, no the utilization of German manpower will constitute one form of given by Matthews (State) to Eisenhower's chief of staff, and reparation. This whole question is to be studied immediately sent us by Taylor, for Treasury use only. by a commission to be set up in Koooow." Program for Elimination of German for Industries The Reparations Commission will also consider: *There WAS general agreement that this question should be 1. Restitution of identified property and in kind. studied urgently by the European Advisory Commission." 2. Reparation of equipment, goods, row materials, etc. 3. Use of German production for reparations. Decentralization 4. Restitution, within Germany, of despoiled property. 5. "There was general agreement that Germany's foreign "There was general agreement that Commany should be de- economic interests should be taken from her and that contralized and that the question of sotual dismemberment would this would constitute some form of reparation to be be studied by & commission to be set up in London composed of discussed in Moscow. Eden, Winant and Gousev. In the brief time available no effort was made to work out many details." France but "As you will have noted from the comminique, it was finally determined that France will be given 8. military zone of occupa- "There was general agreement that interzonal movements of tion of her own. It was also finally decided that France will goods is essential", and be integrated on the Control Council (TOP SECRET. This took some doing: The Russians did not like the idea). No decisions "There was agreement that the closest possible coordination was reached as to the exact location of the French zone. It was of laws and administration between the zones is desired.' left that this could be worked out between the Britisha nd American Governments, but It seens likely that France will be De Nasification, etc. and Funishment given B. part of the British zone west of the Rhine. It will be done in consultation with the French Provisional Government." "There vos complete agreement of the dissolution of list institutions, the German General Staff end the military and para- Other Decisions military organizations, and that this should be done ns for ES possible on 1 uniform basis through the Control Council machinery." 1. Handling of United Nations prisoners and persons. and 2. "There was general agreement on all types of records and archives being made available to the major allies but "The question of German punishment other than war criminals no discussion on details." (which was strongly orged by Prime Maister Churchill but was Regraded Unclassified RECISION TRADE MARK MICROSTAT RSG. M. s. PAR. OFF. MICROFILM BOLL NO. 66 UNITED STATES OF AMERICA FOLUNCTORY - 3 - TREASURY DEPARTMENT liot discussed AIR MAIL Office of the Treasury Embassy of the United States 1. Ear criminals, Ramie nas militarists. Representative London, March 3, 1945. 2. Connealed assete of Germans. S. Use of Jerson solentific cas Industrial developments. 4. Diverent of Jorman population. 5. Government of Berlin. No. 259 5. Lovement of people between sonce. PERSONAL AND CONFIDENTIAL 7. Surrency problems. B. Foreign exchange control. Dear Mr. White: 0. Japanene 0.00 neutral property in Germany. 10. Verman property one national abroad. I an enclosing herewith & copy of a nenorandum 11. Transport, communications end redio. dated January 27 from Brigadier General Frank McSherry to the Chief of Staff dealing with "Military Govern- ment Problems Requiring Immediate Agreement with the Russians", together with a copy of a letter dated February 15 from H. Freeman Matthews to Lieutenant General W. Bedell Smith. The Matthews letter attempts to answer the McSherry memorandum point by point. It would be appreciated if you would keep these papers strictly secret and for the confidential information of Treasury officials only. Sincerely, bill Bill Taylor U.S. Treasury Representative. Mr. Harry D. White, Assistant Secretary, Treasury Department, Washington 25, D. C. Enclosure. Regraded Unclassified RECISION TRADE MARK MICROSTAT/ u PAT. OFF. MICROFILM ROLL NO. ES SUPREME HEADQUARTERS or ALLIED EXPEDITIONARY FORCE 0-5 Division 1. Procedures for handling of United Nations persons and prisoners of war. 27 January 1945 11. Movements of German population and utilization of German manpower. SUBJECT: Military Government Problems Requiring Immediate Agreement with the Russians. 111. Reparations, restitutions, deliveries and financial matters relating thereto, in particular:- TO: The Chief of Staff (a) Restitution to liberated territories of 1. The military situation as reported has potentialities of specifically identified property and restitution in kind. the immediate collapse of German resistance. When this occurs it will be necessary for SHARP to establish military government in (b) Reparations to liberated countries of equip- the British and U.S. Zones. During the early phase of this oc- ment, goods and raw materials, and otherwise. cupation military government will function to a large extent on a local and provincial basis, but many problems of A national (c) Use of German productive facilities for benefit acope will soon present themselves, necessitating definite and of liberated countries - extent to which this will be uniform solution If confusion and chaotic conditions are to be undertaken. avoided. Agreement between the three big powers on certain subjects vital to the conduct of military government are essen- (d) Restitution within Germany of property which tial at an early date. has been the subject of duress, wrongful acts of confisca- tion, dispossession and spoliation. 2. Four subjects of underlying importance should be de- cided by the Allied governments as B. basis for specific planning (e) Disposition of enemy war materials among the United Nations. and operations: a. To what extent will France participate in the military 1v. Interchange of information, in particular; government of Permany? If France participates what area or zone will be assigned to this country? (a) War criminals, Sazis and militarists. b. The Russians in a recent broadcast state that it (b) Financial information, particularly relating is the German nation that 1a guilty of precipitating this war to assets concealed by the Dermans. on the world, not merely the Nazi element thereof, and should be punished therefor. The Combined, Chiefs of Staff policy is (c) Use of German acientific and industrial to punish the Nazia, both AS an organization and as individuals. developments. Much can be done in the early days of occupation if the ultimate objective 65 to whether or not the German people are to be con- V. All types of records and archives. sidered the guilty parties, and what over-all punishment is to be given, is known. 3. In addition to the foregoing, some US-UK-USSA authorities should be authorized to undertake the consideration and agreement of C. To what extent 1a the decentralization of Germany the following problems, 8.8 well as those listed in 24 above: to be undertaken? (See U.S. Joint Chiefs of Staff Directive 1067, para. 11, which reads as follows: a. Program for the permanent pacification of Germany (elimination of Germany's war-making potential). "11. Military administration shall be directed toward the promotion of the decentmiization of the b. Policy respecting tripartite municipal government of the political structure of Germany. All dealings in so far city of Berlin: in particular the initial proclamations and laws. 0.0 possible should be with the municipal and provincial government officials rather than with Federal govern- 0. Prontier control, in particular: ment officials." 1. Policies respecting movements of individuals from d. Efficient machinery should be established to deal one zone to another - restrictions desirable for security with special inter-allied problems arising out of the war and in- reasons, to prevent mass migrations, and to prevent individ- volving countries other than those represented on the EAC. Problems uala from escaping restrictions and punishmente. of this nature are: Daylor Regraded Unclassified PRECISION TRADE MARK MICROSTAT MICROFILM ROLL NO. 71 70 COPY 3 - THE SECRETARY OF STATE WASHINGTON 11. Policies respecting movement of mooda between the zones and across foreign boundaries - problems of February 15, 1945. foreign trade, movement of essential supplies within Germany, movement of exports out of Germany to liberated Lt. General W. Bedell Smith countries. Chief of Staff, Suprese Headquarters Allied Expeditionary force. d. Finance, in particular: 1. Currency problems. Dear General Smith: 11. Foreign exchange Control. You will remember leaving with us at Malta n. memorandum from General McSherry to you of January 27 with regard to 111. The breakup of Cermany's foreign economic interests. military government problems requiring immediate agreement with the Russians. I an attaching a copy of the memorandum e. Foreign relations of Germany, in particular: for your convenient reference. You asked that we endeavour to work out as many of the answers to the questions posed as 1. Japanese nationals and property in Germany. possible and that I let you know what was done. I was not present personally at the military staff conversations and 11. Neutral nationals and property in Germany. consequently not informed of what may have taken place with respect to these problems thereat. Presumably you will re- 111. Terman property end nationals abroad, including celve through military channels full reports of those dis- program for their release and handing over to the United cussions in so far as they affect SHARF. Nations. I give you below our comments on the questions posed f. Lave - extent to which coordination of laws between by General McSherry in so far 6.8 the Crimean Conference throws any 11ght on them. the zones 18 desirable. 5+ Dissolution of Nazi institutions, German General Staff, Paragraph 1: No comments required. and military and para-military formations - to some extent this can be done separately in each zone, but a completely effective Paragraph 2: As you will have noted from the communique, result can best be obtained through centralized control. it was finally determined that France will be given a military zone of occupation of her own. It was also finally decided that H. Transportation and comminications. France will be integrated on the Control Council (TOP SECRET. This took some doing: The Russians did not like the idea). 1. Radio . dissemination of information throughout national No decisions was reached as to the exact location of the French zone. It was left that this could be worked out between the radio system. Britlah and American Governments, but it seens likely that France will be given a part of the British zone west of the (a) Frank J. McSherry Thine. It will be done in consultation with the French Provisional FRANK J. MeSHERRY Government. Brigadier General, OSC Deputy Apaistant Chief of Staff Paragraph 2b; The question of German punishment other 0-5 than war criminals (which vas strongly urged by Prime Minister Churchill but was regarded as too complex for treatment in the brief time available) was not discussed. There was general agreement that "active Nazis" should be removed from all posi- tions of importance and that they should be punished, but no decisions were taken nor was there much discussion or the subject. There was no tendency at any time to exonerate the German nation from precipitating the war. 2. Ene to Jeybi Regraded Unclassified PRECISION TRADE MARK MICROSTAT/ RES.U.L.FAT.OFF. MICROFILM SOLL NO. 73 - 2 - - 3 - Paragraph 2c: There was general agreement that Germany should be decentralized and that the question of actual dis- Paragraph 3 61 There was complete agreement of the dis- memberment would be studied by a commission to be set up in solution of Nast institutions, the German General Staff and London composed of Eden, Winant and Gousev. In the brief the military and para-military organizations, and that this time available no effort was nade to work out many details. should be done as far 88 possible on a uniform basis through the Control Council machinery. Paragraph 2 di 1: An Anglo-Soviet and Anglo-American agreement was signed (the latter by General Deane) on the Paragraph 3 h 1: No discussion. last day of the Conference. The text of this agreement will presumably be immediately comminicated to SHARF. The Secretary of State urged upon Molotov the importance of getting the Russians to implement immediately their agree- Paragraph 2 di 11: There was no definite discussion of ment, already given in principle, to participation In the the general question of movements of German population. There nucleus planning group in London and at SHARP and in sending is e provision in the agreement on reparation that the utili- forward their personnel for the Control Council. I did the sation of Gernan mansower will constitute one form of repara- same with other members of the Russian Delegation. I believe tion. This whole question 1a to be studied immediately by e that with the rapidity of recent military developments the commission to be set up in Moscow. Russians will now come through. Paragraph = di 111: Questions (a), (b), (e) and (d) will I an sorry that we could not work out in detail a number be considered by the Moscow Commission mentioned above. of the above questions. I believe you will realize, however, that the number of highly important overall policy questions Paragraph = di 1v: Questions (a), (b) and (c). No dis- to be settled left us no time in our eight days at Yalta to cussion. undertake the detailed study of the above which we all agree is ao urgently required. Paragraph 2 di V: There was general agreement on all types of records and archives being made available to the major allies It was good to see you at Malta even for a few moments. but no discussion on details. Please give my beat to General Eisenhower -- tell him I wish I were still working for him -- and to all my other friends Paragraph 3 at There was general agreement that this from Torch days -- also my apologies to General McSherry for question should be studied urgently by the European Advisory the sketchiness of the above. I an writing this on a plane Commission. en route from Mossow to Cairo. We spent forty-eight hours in Noscow after the conclusion of the Conference and I must Paragraph 3 be No discussion. say the stmosphere could not have been better. V Paragraph 3 e 1: No discussion Very sincerely yours, Paragraph 3 o 11: There was general agreement that inter- zonal movement of goods is essential. (Sgd.) H. Freenan Matthews H. FREEVAN MATTHEWS Paragraph 3 d 1. and 11: No discussion. Encl. Paragraph 3 d 111: There was general agreement that Germany's foreign economic interests should be taken from her and that this would constitute some form of reparation to be discussed in Moscow. Paragraph 3 e 1, 11 and 111; No discussion. Paragraph 3 f: There was agreement that the closest pos- sible coordination of laws and administration between the sones is desired. Regraded Unclassified PRECISION TRADE MARK MICROSTAT MICROFILM ROLL NO. 74 - 75 TREASURY DEPARTMENT TREASURY DEPARTMENT INTER OFFICE COMMUNICATION INTER OFFICE COMMUNICATION DATE March 12, 1945 DATE March 18, 1945 TO Secretary Norgenthau (For information) TO Secretary Morgenthau (For action) FROM D. Coe F6. FROM Mr. Coe F.C. Subject: Re-entry of Treasury personnel into Philippines. Subject: Suggested appointments with General Hurley and 1. A meeting was cold in Assistant Secretary MaCloy's office General Wedemoyer. on March 9, 1945 to discuss your letter to Secretary Stinson regarding the re-entry of Treasury personnel into 1, As you know, General Wedemeyer and General Hurley are the Philippines. now in Washington to report to the President on the situation in China and to discuss the future develop- 2, War Department representa vesmid that your letter lad ments in the Pacific Mr. crystalized the discussion of the entire problem of the entry of civilian personnel into the Philippines which 2. It in suggested that you nok General Hurley and General had been under consideration in a hit and niss fashion Wedemeyer to call on you separately to discuss with for months. Steps were taken at the meeting to not up a them the situation in China 0.0 it relates to Treasury mechanism to deal with all requests from private corpora- problems, particularly settlement of U. 3. Army expendi- tions an well an civilian governmental agencies desiring tures in China. to send people into the Philippines. 3. General agreement une expressed with the request contained in your letter to Secretary Stimson that Treasury repre- sentatives proceed 0.8 soon an possible to the Philippines to administor a Foreign Punis Control program. 4. The Army has been informed that we will send a tesm of four to six people to Manila. In accordance vi th estab- Mahed procedure Coneral RecArtime 18 nov being asited by the Army to permit the entry of these people into the Philippines. 5. De are asking It. Dol. Vorman Toweon, former Assistant Director of Foreign Punde Control, to head this mission to the Philippines. Re in now discussing with General Strong his release from the Army in order to accept this assignment. Regraded Unclassified RECISION TRADE MARK MICROSTAT/ RIG. u. & PAT. ON. MICROFILM ROLL NO. First of two luncheon meetings to inform top-nanagement of plan for sale of bonds in industrial plants and other places of business. 75 77 2 SEVENTH VAR TOAN LUNGHYCH Minneapolis Club - March 12, 1945 T. L., Daniels, V.P. Archer-Daniele-Nidlend Go. John 0. Peterson Y.P. Acceptances Cargill, Inc. The Honorable Henry Morgentham, Jr. Donald Bagnell, Pres. Chicago, Milwankee, St. Paul Harry A, Bullis & Pacific R.R. Co. President General Mills, Inc. x. 3. Clander Clarence R. Chaney V.P.G le, guil.chm. Hear Co Vine Fm 4m) J. R, Clark Company Northwestern National Bank 0. Nelson Dayton, Pres. E. 8. Abvood Y.R The Dayton Company 3. 7. Selson Hfg. Co. T. R. Brouillette Frest. L. s. Denaldson Co. Palmer Anderson Conn. General Life Ins. Go. P. L. Solether, Trustee J. o. Corneline Y.F. Dalath, 9. here & Atlantic Ry Patten, Barton, Duratine & Debora H. c, Atvent, Pres. Mehard 9, Purber Wee. my Durkee-Atvood Commany County Var Finance Committee V. H. Feldman, Free. Clectric Fachinery life. Co. A. H. Histt, Jr. Astna life Insurance Co. J. 7. Payton, Pres. Clare 1. Long Y.P. Federal Reserve Bank of Mple Marsh & Helennan, Inc. To. x. Vakefield, Pres. First Yet. Bank Paul V. Loudon Piper, Inffroy & Repvesd A. D. Hyde General Mille, Inc. Mrs. Dorethen 0. Hoe Hennepin County Var Finance Committee H. Balls, Supt. I. D. Oven Partner Gepher Ordnance Vorks Allison-Villiams Co. Orier Vheaten, Treas. R, 7. Pack Chur. tBown the Gray Commany, Inc. Northern States Power Go. 2. x. Ennson, V.P. & Treas. Bardware Fatual Insurance Co. Charles N. Petillon Barkshire Life Ins. Co. R. J. Stallman, Trens. V. LaYen Robison 0, 3. McClintook Commany Instal Idfe Insurance Go. of N.Y. Charles x. Kiewel, Pres. (AND OURST) Minneapolis Preving Company Regraded Unclassified RECISION TRADE MARK MICROSTAT/ REG. PAT. OFF, MICROFILM ROLL NO. - 3 70 la 79 Harvin L. Eline, Mayor City of Minneapolis Jefferson Jones Twin Cities Ordnance Plant H. K. Vrench, Pres. Minnespolis One Light Co. D. J. Strones, Pres. Twin City Repid Transit Co. Paul Vishard Mpls. Honeywell Reg. Co. T., 1. landen, Comptroller University of Minnesota V. c. MasFarlane, Pres. Mple. Moline Power Implement Co. D.C. Pirmin Teteran's administration L., c. Spragus, Pres. M. à as. L. Railrond Co. 3. R. Ridder, Publisher n. PAUL DISPATCH E. c, Gross, Pres. fee Idne Railway Julian Paird, Tice Pres. Pirst National Bank Trnest is. Girich, Pres. 11. Panl, Vinn. Hunsingver, Inc. Philip I., May, President A. J. Masson, Tico Pres. First Trust Co. of St. Paul National Ten Company R. Y. Steele John 1, Parker, Pres. Northern States Power Go. Northvestern Aeronautical Coro. 0, s. Devideon Prank Bracelin, Pres. Northern Ordnance, Inc. M. V, Nell Telephone Co. 0, 2. Arnold, Pres. Shirley S, Ford, Pres. Northwestern Eat. life Ins. Co. Northvestern National Bank Heary D. Thrall servictor Arthur Rendall Woodard-Ilvood Company D. V. OBAD & Tone John Cowles, President Philip W. Pillsbury, Pres. MINNEAPOLIS STAR JOURNAL Pillsbury Mills, Inc. John 1, Coan, Postenster Joyce a. Swan Publisher U. s. Post Office Powers Day Goods Co., Inc. c.c. Massie Presl mfs really Tries, Doddrick Oleon, Pres. L. F. Miller, Pres. northrop King reo. messell-Miler Milling De. Col. 1. 1. Taylor Standari-Anderson-Sterling Co. D. X. Strathy, See. Straivesr Knitting Co. PRECISION TRADE MARK MICROSTAT/ No. PAT. OFF, MICROFILM ROLL NO. 81 2/12/2020 thank months - 5 - 80 Schedule for Secretary for Earch 12, 1945 - Kinneapolis Cannot Come E. H. Keating X. H. Keating Agency 0130 A. E. Breakfast Presided over by John Cowles, President, Ster-Journel and Tribune, and 0. J.Arnold, Minnesota War Finance Committee Chairman. [eeding publishers and aditors of Twin Cities - also, Have Not Heard From Forgo, North Dekote. 3. T. Moday 12:15 P.M. Luncheon Cargill, Inc. Shipyards Savage, Minnesota Chairean end principal speaker: Barry A. Bullia President, General Wills Donald 3. Fegies, Pres. Tegles Construction Co., Ltd. Speaker: Ernest L. Cirich, President, Munaingwear, Inc. 711 Vesley Temple Bldg. Group to consist of employers, in the Minnespolis area, V. 3. Tetal,ff, Pres. having over 500 employees. Flour City Ornamental Iron Co. 2637 - 27th Avenue So. 0:20 P.K. Dinner - Nicollet Hotel V. 1. Kay, Pres. Under the suspices of Foreign Policy Association and Northland Greyhound Lines, Inc. Winnespolis Civic and Commerce Association. 509 Sixth Avenue No. Presided over by Oideon Seymour, Vice President and National Can Corporation Executive Editor of ster-Journal and Tribune, Minneapolis. Twin Cities Ordnance Plant Also, President, Foreign Policy Association. Duilding#501, New Brighton 6:00 P. E. Spenking program. H. 3. Atvater, Pres. Sectt-Aiwater Hfg. Co. 8:15-8:45 P.E. 2901 R. Hennepin Ave. Central Mar- Radio time. Station WIOL, Mutual outlet. time Arthar E. Regart 1142 Minnesota 314g. Bend table guests: St. Paul, Kinn. Jenstors Shipstead and Ball (If they accept) years. Wakefield and Ford, Presidents of two large banks Nr. Peyton, Federal Reserve Bank Mr.Boyd, Independent Bankers' Association we. Coffee, President of University of Ninnesota President or Vice President of Civic and Connerce Ass'n. Mr. Sprague Mr. DuBois Mr. 0. J. Arnold Forner Governor 3tassen also being extended invitation. Regraded Unclassified 3/12/41 3/12/25 83 82 AGENDA Oocktail party gueste - Mr. 0. J. Arnold HENNEPIN COUNTY WAR FINANCE COMMITTEE PAYROLL DIVISION LUNCHEON MARCH 12, 1945 6:00 p.s., Parlors 2 and x, Nicollet Hotel - March 12 - preceding dinner MINNEAPOLIS CLUB 12:15 o'clock HARRY A. BULLIS PRESIDING Head table cuests who will attend cocktail party: Secretary and Mrs. Morgenthau 1. Opening remarks by Mr. Bullis Mr. Herbert Gamton Mr. A. F. Luxford 2. Mr. Chaney to introduce special guests and leaders of Mr. George Little Payroll Division 3. Introduction of the Honorable Henry Morgenthau, Jr. by Mr. D. J. Arnold - President, Northwestern Nat'l Life Insurance Co., and Mr. 0. J. Arnold Chairess, Minnesoto Tax Finance Committee 4. Secretary Morgenthau's remarks Mr. eat Kre. Lyman Takefield - President, First National Bank of kpls. 5. Introduction of Mr. E. L. Clrich by Mr. Bullis a. und Krs. Shirley S. Ford - President, Northwestern National Bank 6. Presentation of plan for sale of bonds in industrial plants M. and M. Benj. 7. DuBois - President, Independent Backers Association and other places of business by Mr. Olrich Mr. and Mrs. John F. Paytom - President, Federal Reserve Bank of Mple. 7. Adjournment kr. end Rrs. Gideon Seymour - Vice Pres. and Exec. Editor, Minneapolie Star Journal and Tribune, and President, Minnespolis Foreign Policy Association Hr. and Mrs. Arthur Upgren - Vice President and Xconomist, Federal Reserve Bank Mr. Charles Lisconb and guest - President, Liecomb-Hood Company, Duluth, Mian. and Exec. Vice Chairman, Kinn. The Finance Com. Mr. W. D. Baffeiger - Manager, J. o. Penney Company. Inc., and Vice President Minneapolis Civie & Commerce Association Mr. and Mrs. Donald D. Davie - Exec. Vice Pres., Ninn. & Ontario Paper Company Mr. and Kre. Pierce Butler - Attorney. Doherty, Rumble, Butler, Sullivan & Mitchell - St. Paul: and President, St. Paul Foreign Policy Association (Dr. and Kra. Valter c. Coffey - President University of Minnesota Unable to attend for cocktaile, but will be present at dinner.) 25 RECISION TRADE MARK MICROSTAT s. PAT. OFF. MICROFILM BOLL NO. 94 Questa at breakfast for Secretary of the Treasury Morgenthan Minnempolis Club, Harch 13, at 8:30 A.B. Eeary Korgenthau, Jr., Secretary of the Treasury Herbert Gaston, Assistmat Secretary A. 7. Lurford, Assistant to the Secretary George Little, Public Relations, Var Finance committee Hanus McPadden, nanaging editor, Minneapolis Daily Times Bradley Morison, editorial editor Joyce Swan, publisher Bernard H. Hidder, publisher. St. Paul Dispatch-Pioneer Press Fred Eneberlin, managing editor J. R. Viccine, editor Ralph Keller, secretary, Minnesota Editorial association Fred Schilplin, publisher, St. Cloud Daily Times John 2. Casey, publisher, Jordan Independent Leif Gilstad, executive manger, Minnesota Var Finance Committee O. J. Arnold, chairman, president, Northwestern National Life Insurance company John Peyton, president, Federal Reserve bank A.E ween Clarence llaguia, general manager. V2CX B. s. Mittendorf, general senager, VLOL Star NSTP Thomas Boright, publisher, Commercial Vest Willis L. Williams, editor, . C. K. Michener, manding editor, Northwest Miller John 0. Eykyri, editor, Ninnesota Labor 2. D. Cynner, editor, Hinnenpolis labor Review Berry H. Acers. editor, The Famer Sander Genie, president, Minnesoto 010 George Phillips, president, Centrol Labor Union preside Dree John Covles, president, Minnespolis Stor-Journal and Tribune company John Thompson, publisher Gideon Seymour, executive editor Charles R. Corbin, assistant to the executive editor Thomas J. Dillon, editor-in-chief. Minnespolis Korning Tribune William P. Steven, managing editor, George L. Paterson, editorial editor, Ninnespolis Sunday Tribune Frank W. Peck, president, Federal Land Bank, Saint Paul alam Kennedy Regraded Unclassified MICROPILM 3/10/41 O. J. Arnold Cooktail Party List 85 Representing Minnesota State War Finance Office Staff Mr. Wallace Boes Mr. L. P. Giswold Mr. & Mrs. Martin Mrs. Richard J. Hutchinson Mr. Enil Boie Mr. Harry Schmokel Representing Hennepin County War Finance Committee Mr. & Mrs. Chaney Mr. & Mrs. Long Mr. & Mrs. E. L. Olrich Mr. & Mrs. Paul Loudon Representing Minnesota State War Finance Committee Dr. 0. D. Jesness Mr. Arthur D. Reynolds Mr. & Mrs. John Serles Mr. William Duncan Mrs. Franklyn H. Matson Miss Mary Proal Lindeke Others: Mr. Harold E. Wood and guest Mr. & Mrs. Alan Kennedy (Assistant to Mr. 0. J. Arnold Mr. H. M. Heneman, President Security State Bank Warroad, Minnesota Mr. Otto Brener Mr. J. W. Creen 29 THESE PROPLE WILL OCCUPY SPECIAL TABLES AT DINNER, DIRECTLY IN FRONT OF SPEAKERS' TABLE. RECISION TRADE MARK MICROSTAT REG. U.S.FAT. OFF. MICROFILM ROLL NO. 07 2 - The strides that were taken toward peace and These last few weeks have been so filled with security at Dumbarton Oaks, at Mexico City and at Yalta tremendous events that I think most of us have become as well as the further steps that will be taken at San a little breathless trying to keep up with them. Besides Francisco will be wasted unless there is stable and the heart-warming news from the fighting fronts, we are expanding commerce after the war. The Bretton Woods beginning to see the postwar world take shape before our agreements, therefore, are one of the pillars that must eyes. be both strong and well placed in order to hold up its Following the general acceptance of the Dumbarton share of the international structure. Oaks proposals we have had the welcome news of the Yalta It is hardly necessary for me to remind this audience conference and the increased Western Hemisphere unity that sound business is essential to peace and that it can portrayed at the Mexico City conference. We are looking exist only in a world at peace. The Bretton Woods agree- forward to the most hopeful of all, the San Francisco ments were drafted with a view to making business sound. conference. I am convinced that they succeeded, 80 far as insuring I have come here to talk about a program which is the end of certain very dangerous restraints on trade vital to the success of all the plans that have been made. are concerned. That program was framed at still another conference, held The experience of our generation has proved to us at Bretton Woods, N. H., last summer. There representa- that a well balanced prosperity for our country depends tives of 44 United Nations drew up agreements to establish on a vigorous foreign trade. In peacetime, ten percent of an International Monetary Fund and an International Bank our jobs in agriculture and industry depend directly upon of Reconstruction and Development. The first is designed international commerce. That was true in the high employ- to stabilize currencies after the war; the second pro- ment years of 1929 and 1937 just as much as in the de- vides a part of the machinery needed to finance the pression year of 1932. rebuilding of the wartorn world. Regraded Unclassified RECISION TRADE MARK MICROSTAT/ MS. PAT. OFF. MICROFILM ROLL NO. 89 - 3 - - 4 - One of the greatest brakes on our own foreign trade Now the Bretton Woods agreements are not going to was made up of the discriminatory exchange regulations restore ot. foreign markets all by themselves. But they and the fluctuating currencies of other nations. They are & necessary first step toward getting and keeping found it impossible to buy our flour or our hardware or those markets. our machinery when the price was constantly rising be- The obvious prerequisite for any such foreign trade cause the value of their money was steadily falling. They as we must have to insure full production and full en- tried to save themselves by setting up artificial exchange ployment is a stable medium of exchange. Of course the barriers. They bought less and less from us. governments of the world must sincerely desire stabiliza- No commodity in America suffered so much as wheat tion. The fact that their representatives agreed to the from the loss of foreign markets. In 1914, the United Bretton Woods proposals and approved a schedule of funds States exported 20 per cent of its total production. By which will be put up by their governments proves that the 1940 exports had fallen to less than 5 per cent. Other will to stabilize is there. Our program provides the crops suffered more in volume but none so much in proportion. machinery for making their will effective. Our domestic market suffered perhaps more as a result. All the member nations agree under the plan to maintain Consider what happened when your customers lost their the stability of their currencies, and the Monetary Fund foreign markets. In 1914, the United States sold abroad is established to help them do it. The businessmen of more than 60 per cent of its cotton crop and nearly 50 your community know what happens when the grain market per cent of its tobacco. The cotton and tobacco farmers begins to kick up. The difference of a single point means could est white bread. But in 1940 we were exporting $10,000 to the holder of a million bushels, and when the only 30 per cent of the cotton crop and less than 20 per market is jiggling up and down like a vibrator, the grain cent of our tobacco. Cotton and tobacco farmers were business becomes pretty difficult. either growing their own wheat on mighty poor wheat land, or else they were eating corn pone. Regraded Unclassified RECISION TRADE MARK MICROSTAT/ REG. U.S. PAT. ON, MICROFILM ROLL NO. 81 90 - 5 - - 6 - Foreign exchange is not much different. When was sucked into a. downward spiral as though it had been currencies are fluctuating, or simply depreciating steadily without fluctuation, foreign trade becomes so caught in & whirlpool. After the war, the world will face economic disloca- difficult that it is speedily curtailed. cations and reconstruction problems more complex than Our international connerce is to the economic life anything in history. We will need all the machinery for of the whole country what the Twin Cities are to our grain stabilization and development that we can get. The market. What happens in Minneapolis and St. Paul has Bretton Woods agreements are the answer drawn up by exports repercussions throughout the nation. So does a new ex- from 44 nations. The program represents the accumulated change restriction in Europe. work of three years. In its simplest terms, it means more We have all seen it happen. At one point between business and better business, more jobs and better jobs the two wars, France bought more than half of all her for the people of Minnesota, as for the people of all the radio sets from the United States. But French exchange was extremely unstable. Dealers found it difficult to country. If it aid not mean that, it would not accomplish its get dollars. In terms of francs, the radio sets that other purposes. But because it does provide 8. vehicle were becoming cheaper over here grow more expensive over for the expansion of your foreign trade, it becomes an there. In an effort to avoid 8. monetary crisis, France clapped a quota on American radio sets. Not more than 8 integral part of the world's machinery for peace. I have been talking principally about the Monetary per cent of the country's total sales could be purchased from the United States. Fund. The other half of the program sets up & bank to help finance the world's needs for reconstruction and The drop in sales to France affected more people than the radio manufacturers and their workers. The men thrown development. This bank is hedged about with safeguards to insure sound practices and to help rather than hamper out of jobs became very poor customers for all the products of American industry and agriculture. The whole country private financing. Some very important jobs of repairing Regraded Unclassified PRECISION TRADE MARK MICROSTAT/ No. u, PAT. OFF. MICROFILM ROLL NO. 23 92 - 8 - - 7 - Under the Bretton Woods agreements, this will be war damage are not going to be attractive to private a thing of the past. Any member nation can come for its capital because the risks may be too big and the return government financing to a world bank and make the loan on too low. If the job is a genuinely productive one -- and its merits, free from political shackles. all the International Bank's loans must be made for really What that can mean to peace is plain from any study useful projects - the Bank will either provide the funds of the way in which political strings on government loans or guarantee the private investor. That guarantee is forced small nations into the orbit of one or another of backed by the resources of the Bank, contributed by all the aggressor countries. 44 members. The borrowing country must also guarantee The Bretton Woods program, therefore, must be con- it, and all projects will be carefully examined as to sidered on two broad and vital grounds. In the first place necessity and value. it is good business for the American people. In addition So far this is simply good banking business. But it is a solid contribution to world security. On both there is another aspect of this banking operation which counts I think I know where the people of Minnesota will commends itself to no and has been somewhat overlooked. stand. In the past, many smaller or hard pressed countries have --oûo-- been obliged to sacrifice some of their political independence in order to get essential financing. A creditor country would insist upon concessions, often of a political nature or imposing & restrictive trade relationship upon the debtor. The result was & new barrier in the way of world trade and a new link in the chains which power politics had forged for free peoples. Regraded Unclassified PRECISION TRADE MARE MICROSTAT/ MS. PAT. OH, MICROFILM ROLL NO. 95 78V 2nd drugs 5/12/43 - 2 - They are more then that. These last few weeks have been filled with trenendous Unless they are put into effect the strides toward events. Besides the stirring news from the fighting fronts, peace and security at Dumbarton Oaks, at Mexico City and we are beginning to see the outlines of the postwar world. at Talta, as well as the further steps that will be taken A program for peace is taking shape before our eyes. at San Francisco, may end only in frustration. Peace to Following the general acceptance of the Dumbarton Oaks be secure must rest on the firm foundation of profitable proposale we have had the great news of the Yalta meeting industry within nations and profitable and expanding and the increased Western Hemisphere unity portrayed at commerce between them. Mexico City. Now we look forward to the meeting which we The Bretton Woods agreements deal with two great problems. hope may prove most fruitful, the conference of the United One is to reconstruct the economies of countries devastated Nations in San Francisco next month. by war so that they can resume production and trade and to I have come here to talk about an essential segment supply others with funds needed for the development of their of the peace program, prepared at another conference of resources. The second is to establish a. system of fair the United Nations held at Bretton Woods, N. E., last monetary practices that will put an end to the disorderly summer. There representatives of 44 nations drew up agree- exchange conditions and destructive rivalries of the past. ments to establish an International Monetary Fund and an Early in our discussions, we considered joining the functions International Bank for Reconstruction and Development. of the Bank and the Fund in one institution. We decided I have been in close touch with every stage of the against it. I think you may want to know why, since the progress of these agreements, through two years of prelimi- question was raised after the agreements were completed. nary work, through the conference itself and through the The two deal with entirely different problems. They discussions since then. I can assure you that they are will need staffs with entirely different training. definitely good business for the United States. Regraded Unclassified RECISION TRADE MARK MICROSTAT/ No. PAT. OFF, MICROFILM ROLL NO. 17 - 3 - - 4 - The Bank will be concerned exclusively with long-term Before the war, the monetary stability of each country investments - loans for twenty to thirty years, or even was supposed to be its own private business. Each was left longer -- for productive purposes. Its staff will have to to its own devices so far as its currency was concerned. study the long-term debt positions of various countries, Most countries struggled desperately to get onto the gold their places in world trade, the value of the project for standard. Before 1922, only eight were on gold. Through which the loan is intended. The Bank will have only in- very real sacrifices in the way of deflation, over-valued vestment problems. It is worth remembering that in this currencies and lost exports, 45 achieved the gold standard country we learned from experience that it was necessary in a precarious way by 1928. But the first serious pressure to enforce separation of commercial banking from investment was too much for most of them. Six were knocked off gold banking. at the start of the decline in international trade. By 1936 The Fund is not an investment institution at all. It only seven were left, five of them with currencies closely will be concerned exclusively with the current operations associated with the dollar. The world was back where it had of the exchanges, with fluctuations in the exchange markets, started fourteen years before. with seasonal and other factors affecting the exchanges. But that doesn't tell the whole story. This was an It must recommend correctives for prompt application. era of trade warfare in which country after country employed This is a highly specialized function reflected in the currency manipulation along with other forms of discrimina- organization of the big banks that operate in the exchange tion in the effort to save itself at the expense of other markets. Their separate foreign exchange departments are nations. In 1932 Germany began to use clearing agreements staffed with highly specialized technicians. I think we to force less powerful nations to trade with her. These at Bretton Woods were wise to follow what is now accepted agreements permitted Germany to get what she needed from the best banking practice. them and pay in return what she wanted to export -- harmonicas or aspirin where the other country really wanted dynamos and locomotives. Regraded Unclassified PRECISION TRADE MARK MICROSTAT/ RIG. v. 5. PAT. ON, MICROFILM ROLL NO. 99 - 6 - - 5 - Foreign loan operations under the Bank and under the In other cases Germany blocked payments due on previous system in use before the war will present an equal contrast. exports and on credits extended to Germany, so that some In the past, when countries needed foreign capital to help countries were forced into payment agreements to protect in their development, they came to the investment market the investment of their citizens. and paid perhaps 7 or 8 per cent interest. Discounts on All this led to a tangle of discrimination and preference that spread over Europe to the great cost of American top of that sometimes gave them no more than 90 of every 100 dollars borrowed. Too often the loans were made for exporters and the peace of the world. By 1938 Germany alone had 36 clearing agreements, Italy and Greece 28 each, Turkey unproductive purposes, without adequate supervision and with little prospect that the borrower could ever repay. 23 and so on. The only country in Europe that had none was The borrowing country and the American purchaser of foreign Albania. Only Ireland, Norway and Russia succeeded in keep- ing their clearing agreements to 88 few as five. bonds were both losers. The International Bank will make it possible for these The Fund will deal with the situation that led to this countries to obtain their capital for worthwhile, productive confusion through international cooperation. Each member country will define its currency in terms of gold and under- projects. The Bank will guarantee loans for such purposes so that they will be attractive to the private investor on take to keep it stable. If It runs into trouble, it will reasonable terms. The Bank will undertake this only when not have to act alone, using currency depreciation or dis- the borrower can service the loan, when its usefulness is criminatory regulations which will spread depression from clear and when the charges are fair. one nation to another. It will be able to consult with others There will be great need for such B. service. We cannot through the Fund and get help to maintain stability. Stability have a prompt restoration of the producing and consuming of exchanges will facilitate trade by encouraging each country to buy where it wishes. The pressure to create power of the world while Europe is wrecked and great areas discrimination, preferences and the other instruments of of the world remain undeveloped. economic warfare will be kept to a minimum. Regraded Unclassified RECISION TRADE MARK MICROSTAT/ PAT. OFF. MICROFILM BOLL NO. 100 10 - 7 - - 8 - The Bretton Woods program offers currency stability which was only 8 per cent of our production. to facilitate trade, and credit protection which will As a result, the wheat farmers were forced to sell benefit the borrower through reasonable loans for sound use more of their wheat at home. But as our total export trade and the American people through an increased market for fell from $7 billion to $2 billion, the income of workers their products. in industry and agriculture fell sharply. The result was The experience of our generation has proved to us that that the wheat which brought $1.25 8. bushel in 1928 was a. well balanced prosperity for our country depends on 6. sold for 60 cents in 1932. vigorous foreign trade. Under normal conditions, ten per- or course the Bretton Woods agreements are not going to cent of our jobs in agriculture and industry depend directly restore our foreign markets all by themselves. But they are upon international commerce. That was true in the high a necessary first step toward getting and keeping those employment years of 1929 and 1937, but the sharp decline in markets. 1932 had much to do with the severity of the depression. The businessmen of your community know what happens when The greatest brakes on our own foreign trade were dis- the grain market begins to kick up. The difference of & criminatory exchange regulations and the fluctuating currencies single point means $10,000 to the holder of a million bushels, of other nations. They found it impossible to buy our flour, and when the market is jiggling up and down like a vibrator, our hardware, or our machinery when the price in their the grain business becomes pretty difficult. currencies was constantly rising because the value of their Foreign exchange is not much different. When currencies money was steadily falling. are fluctuating, or simply depreciating steadily without No commodity in America suffered so much as wheat from fluctuation, foreign trade becomes so difficult that it is the loss of foreign markets. In the years 1925-1928 the bound to fall. United States exported $239 million worth, which was 21 per Our international commerce is to the economic life of cent of its total production. In 1931-34, the era of the whole country what the Twin Cities are to our grain market. exchange discrimination, this had fallen to $38 million, Regraded Unclassified RECISION TRADE MARK MICROSTAT/ U.S.PAT. OFF, MICROFILM BOLL NO. 101 B - 10 - - 9 - What happens in Minneapolis and St. Paul has repercussions that unanimous will on the part of the 44 United Nations throughout the nation. So does a new exchange restriction to work together. I wish it were possible to describe the manner in which in Europe. We have all seen it happen. At one point between the that will was expressed at Bretton Woods. You have all taken two wars, France bought more than half of all her radio sets part in meetings at which & variety of interests were repre- from the United States. But French exchange was extremely sented. Perhaps there was a little wrangling and horse unstable. Dealers found it difficult to get dollars. In trading. terms of france, the radio sets that were becoming cheaper At Bretton Woods were representatives of 44 nations over here grow more expensive over there. In an effort to covering the whole range of the world in size, stage of conserve exchange, France clapped a quota on American radio economic development, customs and economic conditions. Yet sets. Not more than 8 per cent of the country's total sales they succeeded in hammering out 8. thoroughly workmanlike could be purchased from the United States. program because they knew that we must either create an The drop in sales to France affected more people than orderly system now or sink back later into the chaos of the radio manufacturers and their workers. The men thrown individual expedients and devil-take-the-hindmost. They out of jobs became very poor customers for all the products were animated by the new international spirit. They agreed of American industry and agriculture. The whole country to pledge large sums which could not benefit their countries was sucked into & downward spiral as though it had been caught directly, but were a contribution to the general welfare, and they were farsighted enough to know that what helped in a whirlpool. To achieve the stability and the development through others also helped them. mutual effort which is needed to prevent a repetition of Let me give you perhaps the most dramatic example that this collapse, it is obvious that the first requisite must be occurred. In the list of subscriptions to the Bank, Russia a sincere desire on the part of all governments to achieve had been put down for $900 million. This is & tremendous them. The Bretton Woods agreements are the expression of Regraded Unclassified RECISION TRADE MARK MICROSTAT/ NO. u. PAT. OFF. MICROFILM BOLL NO. 101 E - 11 - - 12 - sum for a country whose richest districts -- bigger than any program is now before Congress. Favorable action by the single country in Europe have been ravaged with the" House of Representatives in advance of the session at utmost brutality by the Nazis. On the last day of the con- San Francisco on April 25 will be & token to all the delegates ference, Russia announced that she would increase her that the United States is thoroughly in earnest about joining subscription to twelve hundred million dollars. Russia with other nations to achieve international security. A assumed that additional $300 million obligation, not because House vote for Bretton Woods will strengthen the hands of there could be any direct advantage to the Soviet Union, but our own delegates at San Francisco. in order to create a stronger Bank with a. larger capital, I an sure that as this becomes better understood, the able to contribute that much more to the rebuilding of the favorable vote will be forthcoming. As I have said, I an world. absolutely convinced that the Bretton Woods program is good All the other countries manifested the same spirit. business for the American people -- all of them. Many of them expect no other benefit from their share in the But there is another aspect of even greater importance. $18 billion dollar capital of the Bank and the Fund than At Bretton Woods we proved that delegates from the govern- a contribution to that better world in which they can work ments of most of the world could meet together and consider out their own prosperity and security. ways of helping each other instead of killing each other. The Bretton Woods agreements were conceived in the This is the international spirit of the United Nations, the very practical spirit of cooperation. They represent the ideal for which Americans are dying today. But it is harder first such set of resolutions which have been presented to to live for an ideal than to die for it. And that more our people for the achievement of the ideals for which we difficult task is for us at home to perform. It is because are fighting. They can be an inspiration to all the other I feel so deeply that the Bretton Woods agreements are so meetings of the United Nations and an example of how the much & part of this new spirit, are so essential to its most difficult problems can be overcome through mutual good development, that I have been urging their acceptance. As will. The legislation to carry out the Bretton Woods Regraded Unclassified PRECISION TRADE MARK MICROSTAT/ OH. MICROFILM ROLL NO. 3rd 20d chaps march - 18 - 12,198, I see it, we are called upon in these times to express and These last few weeks have been filled with tremendous to net upon our faith in mankind. At Bretton Woods, we set events. Besides the stirring news from the fighting fronts, our hands to a very real expression of our faith in the we are beginning to see the outlines of the postwar world. capacity of men to work together for their mutual benefit. A program for peace is taking shape before our eyes. I am sure that We will not stop there, but will carry on to Following the general acceptance of the Dumbarton Oaks the achievement of all that our men have died to win for us. proposale we have had the great news of the Yalta meeting They have died 80 that we might have another chance to build and the increased Western Hemisphere unity portrayed at peace and security and a decent world for all its people. Mexico City. Now we look forward to the meeting which we It is for us to live for the same great ends. hope may prove most fruitful, the conference of the United I believe the American people are determined to do just Nations in San Francisco next month. that. Our generation has been given 8 new vision of the I have come here to talk about an essential segment world. It is as though we were seeing the earth whole for of the peace program, prepared at another conference of the first time. Perhape you remember how that was when you the United Nations held at Bretton Woods, N. H., last made your first airplane trip. Soaring over the city, you summer. There, representatives of 44 nations drew up agree- really caught a glimpse of its magnificence, the wonder of ments to establish an International Monetary Fund and an it all complete and the shabbiness and ugliness concealed International Bank for Reconstruction and Development. under the larger view. And it might have been that as the I have been in close touch with every stage of the plane flew in from the East, you were in darkness, but ahead progress of these agreements, through two years of prelimi- you could see the sun. We of America, we of the United Nations nary work, through the conference itself and through the are near enough to the end of our war journey to know that discussions since then. I can assure you that they are although the night is still all around us, we are coming out definitely good business for the United States. into the light of a new day with its new opportunities for creating a better and safer world. --oûo-- Regraded Unclassified RECISION TRADE MARK MICROSTAT PAT. OFF. MICROFILM BOLL NO. 101-M 101-I - 3 - - 2 - The Bank will be concerned exclusively with long-term They are more than that. investments for productive purposes loans for twenty to Unless they are put into effect the strides toward thirty years, or even longer. Its staff will have to study peace and security at Dumbarton Oaks, at Mexico City and the long-term debt positions of various countries, their at Yalta, as well as the further steps that will be taken places in world trade, the worth of the project for which at San Francisco, may end only in frustration. Peace to the loan is intended. The Bank will have only investment be secure must rest on the firm foundation of thriving problems. industry within nations and profitable and expanding The Fund is not an investment institution at all. It commerce between them. will be concerned exclusively with fluctuations in the ex- The Bretton Woods agreements deal with two great change markets, with seasonal and other factors affecting problems. One is the problem of providing capital to the exchanges. repair the devastation of war and for development purposes. Whether to join the Fund and the Bank in one institution The other is the problem of establishing a system of fair is not 6. question of form. It goes to the very heart of the monetary practices that will promote trade instead of stabilization problem. Those who argue for one institution hindering it. The solution proposed is the creation of think of currency stabilization as a matter of making loans. two institutions, the Fund and the Bank. Early in our That is not our conception of the problem at all. We think discussions, we considered joining the functions of the the Issue goes much deeper. We believe the essential aspect Bank and the Fund in one establishment. We found good of the Fund to be the setting of standards for fair dealing reasons for not doing that. I think you may want to know on the exchanges. Giving help to some countries to maintain what these reasons were, now that the question has again our standards once they are set is incidental to the attainment been raised. of this main objective. Long-term stabilization loans to a. few The two deal with entirely different problems. They countries would be & poor substitute for broad and constant will need staffs with entirely different training. cooperation in meeting international currency problems. Regraded Unclassified RECISION TRADE MARK MICROSTAT/ us U.S. PAR. OFF. MICROFILM BOLL NO. 101 K - 5 - - 4 - preparation for war. That can be secured only through 8. Fund which is concerned This is how It worked. In 1932, when everyone found exclusively with bringing all countries together to work markets very scarce, Germany agreed with some Balkan countries for currency stability. to buy most of their wheat and raw materials at good prices The fundamental reason for monetary disorder after the in marks. But the Balkan merchant did not get marks. These last war was failure to understand the necessity for were paid into the Reichsbank. The Balkan countries then international cooperation in dealing with this problem. had to buy goods in Germany to get the value of those marks. Each country was left to its own devices. Before 1922 The Balkan importer paid into his central bank the price of only 8 countries were on the gold standard. By 1928, the German goods, and only then could the seller of the through real sacrifices, about 45 had made & precarious wheat or other raw material get his money. return to gold some with the help of stabilization loans. As a matter of policy Germany bought much and sold But the first serious pressure was too much for them. The little. She was generally & year behind in meeting clearing wolf pack of exchange speculators was on the prowl, seeking obligations, and then frequently forced the Balkans to take out weak currencies to destroy, and adding immeasurably to articles they didn't need or want simply so they could pay the difficulties of the countries which sought individually their own exporters. Too often they got harmonicas and to maintain currency stability. One by one countries were aspirin when they needed locomotives and dynamos. forced off the gold standard until by 1936 only 7 were left. Through these agreements, Germany tied the economy of The world was back where it had started 14 years before. neighboring countries to the German war machine 60 that But that doesn't tell the whole story. This was when she began her war she would have access to paw materials. In self defense, other nations were forced an era of economic warfare. The weapons were currency manipulation and other forms of discrimination. The aim of to adopt similar measures. each country was to save itself at the expense of others. The bilateral clearing agreement was the most destructive of these weapons, because it was in fact part of Germany's Regraded Unclassified RECISION TRADE MARK MICROSTAT/ REG. PAT. OFF. MICROFILM ROLL NO. 101.M - 8 - That was the system under which Americans used to - 7 - lend money abroad. By 1939, not counting the World War I use before the war. In the past when countries needed loans, more than 40 cents of every dollar they had invested foreign capital they too often had to give away some of in foreign countries was in default. their independence to get it. And they usually paid The International Bank will make it possible for high interest rates in the bargain. countries to obtain capital for worthwhile, productive For instance, a great many of you will remember projects. The Bank will guarantee loans for such purposes Kreuger and Toll. Frequently when a European country was so that they will be attractive to the private investor on seeking foreign loans, Kreuger would turn up in the reasonable terms. And there will be no need for a country Finance Minister's office. He was glad to oblige with to give the lender a match monopoly or a salt monopoly, quite a large loan. All he asked was the country's match or to pledge its sovereignty in the form of an assignment monopoly, and of course profitable rates, too. Kreuger of custom revenues. There will be no need for these methods then sold not only the bonds he took for the loan, but because the Bank will undertake loans only where the forged duplicate sets of them as well. Some of you in project is productive, only where the charges are fair, this audience may still hold Kreuger and Toll Securities. and only where the borrower can service the loan. You know what they are worth. "There is urgent need for such productive investment. Kreuger was not the only operator in those days. We cannot have 8. prompt restoration of the producing and Undeveloped countries seeking foreign loans frequently consuming power of the world while Europe is wrecked and secured from other sources loans that cost them too much great areas of the earth remain undeveloped. and were often tainted with fraud. Many of them were To sum up in simple terms: the Bank is a cooperative squandered on projects which could never pay off. There method of providing capital for productive purposes to was little or no supervision to make sure the money was spent countries that need capital for reconstruction and development. for productive purposes. In too many cases there was little prospect that the investor would get his money back. Regraded Unclassified PRECISION TRADE MARX MICROSTAT/ REG. u. $ PAT. OH. MICROFILM BOLL NO. 0 - 10 - - 9 - Its purpose is to safeguard the interests of the borrower No major commodity lost so large a part of its foreign and the investor. That's what the Bank is and what the market as wheat. In the years 1925-1928 the United States Bank does. And you can see that its business is lending, exported $239 million worth a year, which was 21 per cent of production. In 1931-34, the ora of exchange discrimination, not monetary stabilization. The Bretton Woods program offers currency stability this had failen to $38 million, which was only 8 per cent of our production. to facilitate trade, and credit protection for sound international loans. Both will benefit the American people As 8. result, wheat growers were forced to dump their through an increased and more stable market for their crops at any price. The farmer in the Red River Valley was being squeezed, as truly " If he had caught his hand products. The experience of our generation has proved to us in a threshing machine, by the exchange rates of the rupee that 8. well balanced prosperity for our country depends and the yuan and the peso. The instability of foreign on 8. vigorous foreign trade. Ten per cent of our jobs in currencies was one of the chief reasons why No. 1 Dark agriculture and industry depend directly upon international Northern, which sold for $1.64 a. bushel in Minneapolis in commerce. That was true in the high employment years of May, 1928, brought 49 cents in December, 1932. It helps 1929 and 1937, but the sharp decline in 1932 had much to explain why flour sold here for $8.68 a barrel in May, 1928, and $4.02 in November, 1932. do with the severity of the depression. Let's see what discriminatory exchange regulations Of course the Bretton Woods agreements by themselves and fluctuating currency meant to the Twin Cities and the are not going to restore our foreign markets for wheat or Northwest. Countries abroad found it impossible to buy anything else. But they are a necessary first step toward getting and keeping those markets for thousands of our wheat and flour, and the same was true of our exports American products. New exchange restrictions anywhere in of hardware and of machinery. the world can close them. Regraded Unclassified MICROSTAT ass. U.S. PAT. OFF. MICROFILM ROLL NO. RECISION TRADE MARK - 11 - - 12 - We have all seen it happen. Our exports of commodities workmanlike program because they knew that we must either and of manufactured goods reached a high point between the create an orderly system now or sink back later into the two wars, but in the 30a our farmers and our manufacturers chaos of individual expedients and devil-take-the-hindmost alike fought a losing and hopeless battle to restore their They were animated by the new international spirit. export sales in the face of depreciated currencies, quotas Let ne give you perhaps the most dramatic example and other barriers set up against us. The men thrown out that occurred. In the list of subscriptions to the Bank, of jobs because of this lost trade became very poor Russia had been put down for $900 millions. This is a. customers for all the products of American industry and tremendous sum for a country whose richest area -- bigger agriculture. All these restrictions had much to do with than any other country in Europe -- has been ravaged with intensifying and prolonging the great depression. the utmost brutality by the Nazis. On the last day of the To prevent this chain of disasters being repeated conference, after the subscriptions were closed and all after this war is it not perfectly plain that the first countries had agreed on the ailocation of subscriptions, thing we need is a sincere desire on the part of all Russia announced that she would increase her subscription governments to work together to prevent them? The Bretton to tweive hundred million dollars. Russia assumed that Woods agreements are the expression of & unanimous will on additional $300 million obligation, not because there could the part of the 44 United Nations to work together to that be any direct advantage to the Soviet Union, but in order to end. create a stronger Bank with a larger capital, able to I wish it were possible to describe the manner in contribute that much more to the rebuilding of the world. which that will was expressed at Bretton Woods by representa- This 18 a symbol of her determination to cooperate tives of 44 nations covering the whole range of the world wholeheartedly with us and the other United Nations in the In size, stage of industrialism, customs and economic task of reconstruction and development. conditions. They succeeded in hammering out a thoroughly Regraded Unclassified PRECISION TRADE MARK MICROSTAT/ R$6. V. s. PAT. OH. MICROFILM ROLL NO. 101-5 - 13 - - - 14 - The Bretton Woods agreements were conceived in the It is because I feel deeply that the Bretton Woods very practical spirit of cooperation. They represent the agreements are 80 much a part of this new spirit, are so first such set of resolutions presented to our people for essential to its development, that I have been urging achievement of the ideals for which we are fighting. They their acceptance. We are called upon in these times to can be an inspiration to all the other meetings of the express and to act upon our faith in mankind. At Bretton United Nations and an example of how the most difficult Woods, we set our hands to & very real expression of our problems can be overcome through mutual good will. faith in the capacity of men to work together 8.5 partners The legislation to carry out the Bretton Woods program in peace. is now before Congress. I hope that time will permit the I believe the American people are determined for House to not favorably on it before the United Nations their part to do just that. Our generation has been given delegates gather at San Francisco on April 25. This would & new vision of the world. It is as though " were seeing show that the United States is thoroughly in earnest about the earth whole for the first time. Perhaps you remember joining with other nations to achieve international how that was when you made your first kirplane trip. security. Soaring over our country, you got 8. new perspective of it, At Bretton Woods we proved that delegates from the a new glimpse of its magnificence and the interdependence governments of most of the world could meet together and of its people. And it might have been that as the plane consider ways of helping each other. This is the inter- flew in from the West, you were in darkness, but ahead you national spirit of the United Nations, the ideal for which could see the dawn. Americans are dying today. It is our task at home to live We of the United Nations know that although the night for that ideal. is still all around us, we will come out into the light of 8. new day with its new opportunities for creating a better and safer world. --000-- Regraded Unclassified PRECISION TRADE MARK MICROSTAT MICROFILM ROLL NO. 12" 103 DEPARTMENT INCOMING DIVISION OF OF CENTRAL SERVICES STATE TELEGRAM TELEGRAPH SECTION PEM-33 Stockholm No paraphrase house necessary Dated March 0, 1945 (SECRET) DEPARTMENT OF STATE Reo'd 7:43 10th 102 DIVISION OF RECORDS CENTRAL SERVICES Scoretary of State, March 12, 1944 Wahington. TO: The Honorable Henry Morgenthau, Jr., TOP SECRET Secretary of the Treasury. US URGENT FROX: Raymond E. Geist, Chief of the Division of Central Services. 932, March 9, midnight Olsen had a two-hour discussion alont with Fritz A copy of this telegram has been likese yesterday afternoon on the prearranged understanding given personally to the Secretary of Var, the Secretary of the Navy, and to that the discussion von entirely a personal exchange of General Magruder of the Office of Strategic Services. viewa on hucanitarian problema and in no way to be con- strued 0.0 official (Legation's 876, March 7, noon). Olsen inquired thy Hease had controted him and the latter replied that Kleist (clost associnte of Hinder) had suggested It in Berlin the past week sa well 0.8 "other important German authorities". Olsen inquired what posi- tion Hease held in German Government and he replied that Rwf he vas a member of the German Fortign Office with direct lints to the top officials, be emphasized the very top, in German Government. HC stated that at outbreak of war, he had been attached to German Embassy in London in & public relations capacity and that for a while thereafter, he was Regraded Unclassified RECISION TRADE MARK MICROSTAT/ NEG. U.S. PAT. OFF. MICROFILM BOLL NO. 104 105 -2- #932, March 9, midnight, from Stockholm. #932, March 9, midnight, from Stockholm, ht was the Internadiary between the Derma and British Governments, Ht rode refertnce to personal discussions Three. Hg had actively oppoard the blitz on London with Churchill In 1939 md quoted certain comuenta ende by as a major blunder In military atrattgy, almost at risk the latter during such discussions. lie added that since of his neek although Inter he von vindionied even In his return to Berlin, he had pursued his independent con- German military circles. victions on war policita and that such convictions had on Heast then avung into the first phase of his major occasion placed his in considerable personal jeopordy. points. Ht and that It vsa generally known in Berlin Olatn inquired what these convictions were and the follow- that Olsen could be approached on humanitarian problems 1ng vere mentioned. and that he vas prepared to any, EYES at the price of Onc. He had pressed for a moderate and circunspect revealing strategic military information, that high GERMAN treatment of prisontra of war in opposition to a high circles were brooming increasingly ware that they had military group (he was unwilling to identify then) the were pressing problems of their own of a sinilar nature, lie dispoard to exterminate then through ill-trestment and went on to say that Allied bombing of Germany vos exceting neglect. He added that he could say without examperation a fearful toll on civilian population and that certain that the lives of "several hundred thousand" were anved key officials in Otron High Conniend were at present time through his efforts within high Otrens circlrs. Be atated most receptive to any broad agreement which would that while prisoners of var had to work very hard, and "humanize the war", Olsen saked for clarification on the certainly were not overfed, na a group they would compare term and Heast supplied the following. well with the average Derman population. Allied hombing In recent months has been less and Two. Hr had pressed vigorously against personation less effective from a military point of view, dut, he of recial and other minority groupe and believed his sold, to the rapid obliteration of military war agreement efforts had been helpful, at least Vithin Dermany, with the result that destruction of civilian lift and Three. property has become increasingly top heavy, Rt stated that at present 65% of the German population hondless and living Regraded Inclassified RECISION TRADE MARK MICROSTAT' MICROFILM BOLL NO. 106 107 ÷ 0932, March 9, midnight, from Stockholm. living in utmost nistry. Ite added that, while he USE -6- #932, March 9, midnight, from Stookholm. unsure of Russian or British attitude, he could not believe the United States would direct such vanton without any military consequence whatever, was the destruction against innocent civilions (children, HOMEN slaughter of thousands of confined war invalida. He said and old men It WCS added) 0.0 a toll for such limited that three were only a few examples of n. senseless massacre military objectives. Olsen replied that the virus of of civilians which, he added, has already included United States government on humane unrfort are quitt thousands of Allied prisoners of war and he concluded by fully chronicled and that any of the Allica have 0 fairly stating that If these incidents continue, he la fearful obvious choles between dropping a bonb on a child or of the steps which night be taken both by German authorities military depot but that arrial warfart, and the defends and civilians. against it, necessarily sprted the ingord. Hease agreed Reverting to the 68% of civilian population homeless in principle but mentioned certain recent Allied boobIngs. and displaced as 3 result of bombing notion, Olnen saked Rt stated that In addition to bonbing Dresden, Allied Hease If that result was not in itemlf of no small plants strafed a wide orta of temporary Red Cross consequence considering the drug It must exert on the quarters (plainly marked be and) which were housing German war effort. HEADE replied this was entirely refuges women and children and killed not less than ten dependent on what type of long-rangr view one took of thousand of them. He added that the recent raid on the war. He sold proctically every perman including the Sasanita vas nothing short of nurder of = defenscless High Command had no doubts that the var was lost, These group. Ht stated tint a aybody lenewing anything st all serve people, however, feel Allits are over-optimistic about targets in Germany would have known that this vas and not prepared to reckon their controcted striking a large Rtd Cross area for war vounded without a military power and reserved of wer nateriole to nake closing drive installation within milts. Be sold that the only result, of the war na expensive DE possible. apart from a 24-hour interruption of a railway service Olsen then baked HERSE how it who possible that vd. thout German civilian population could continue such a hopeless struggle Regraded Unclassified PRECISION MICROSTAT/ MICROFILM BOLL NO. 108 109 -6- #932, March 9, midnight, from Stockholm, -7- #932, March 9, midnight, from Stockholm, struggle under terrible privation without internal any with greatest assurance that three individuals WERE revolt. Hease replied it was in part the sont military receptive to any suggrations, at least, ht emphosized, blunder made by Germans in their Blitz on London. Like at the present moment. Olsen inquired just what German the British, German civilians are fighting mod. In High Command was proposing 0.8 step to "humnizing the addition Hease added, Allits have actually delivered wor". Resst said a quickly-instituted agreement, along completely to Nazi domination 65% of the German population lines of the GENEVA Convention, for protection of civilian (these people are living on day-to-day basis without populations was desired. Olsen inquired what prootionl food, olothing or shelter except that supplied by the measures Orrmans could propost, giving full effect to the Nozi Command. Whether they are bonbed out of one city contracting German defense lines and the nort or less to another dots not now make much difference, they are inseparable intermingling of civilians and Bilitary homeless anyhow, but the important item in their daily personnel in legitimate combat areas. The reply vas vague lift is that their existence 1a supplied by the German except Heasen repeated assurance that any riasonable authorities. Consequently sheer personal Emergency of bosis would be nocepted, so Olsen inquired whether German their day-to-day thinking provides no opportunity of High Comman perhaps had in mind a limited stries of organized revolt. demilitarized safety ZONES. This apparently found favor. Reverting again to "humanized worfart", Olsen Olsen then inquired what steps German authorities suggested to Hease that he should be fairly convinced, were willing to take to "humnnist the war". Heast stated or be would not be in Stockholm, that Americans did not he could any without hesitation, and was already wish to destroy innocent civilions during unrfore, but authorized to say, that Dermins would permit all Jewa to that it would be difficult for Olsen to convince leave Germany, se soon 08 technical details could be Amtricans that Hease'n superiors sprcifically Himnler, worked out, He stated there were "several hundred Ribbentrop, Gorbbels and others had any atrious thousand". In response to inquiry whether this included inclinations in that direction. Heast stated he could all Jews of all ages, he and it included every (repeat say with every) JEV in Germany. Olsen stated that while United States Regraded Inclassified RECISION TRADE MARK MICROSTAT/ REG. U. PAT. OFF. MICROFILM BOLL NO. 111 110 -B- 4932, March 9, midnight, from Stockholm, -9- #932, March 0, midnight, from Stockholn. United States public opinion 1a appalled at the missaore of world pract and international security organization was and perstoution of Jeva in Europe, there are also other nonsense since Russin would not only destroy all hopes of groups to whom death La equally painful and objectionable peace and order in Europe for years to comt perhops particularly prisoners of war and civilian Internecs. centurits but would be a mensor to world peror unporalleled Inquiry made 0,0 to what stops Gerunne could take to in history. Ht referred to Germaby's colomool mistake in provide these groups with protection certainly not less undercatinating Russion military potential and fact that than that afforded German civilian nondorbotants. Jesse EVEN today Russians have within Europt greater military replied that while he had no authorized commitments on strength than rest of Allica have under STUD, He stated this point, he could personally guarantee that It should be obvious that in event of future strious dis- (..) Prisoner of war exchange could be arranged turbance in Europe, which he foreanst na Inevitnble and immediately on largest sonle possible consistent with constant, no security organization shotever its size could whatever basis Allics threacives vish to propost. cops with Russin. Ht then introduced the familier argument (B) Remainder be reserved to safety of anne that British and Americans were scaling their pun future "demilitarized nafety sone" provided for Otrian civilians, by destroying Cermany and its civilinn population. under supervision of International Red Cross. Olsen suggested that If responsible circles 10 à stoondary frequently injected phose of the CONVER- Germany shared Hease's views as to hopeless situation sation involved Heane's bitter compents regarding the within Cernany and Europe's dark future, It 100 rether Russians, which Olsen frequently interrupted with coment remarkable that sonclusion had not been renched that that they were not at all related to "this huminitarian unconditional surrender was Germany's most hopeful discussion". However, Rease's comunts may be interesting, immediate prospect. Hease replied there VIA not a single Ht stated British and Antricons have very little responsible official who entertained EVEN the faintest time left to realise their fatal blatake In setting Russia thought of suprender and it FOR quite improbable that up na ruler of Europe. He added that United States talk even further intensification of var strain would product of world any change Regraded Unclassified RECISION MICROSTAT MICROFILM BOLL 112 113 -10- #932, March 9, midnight, from Stookholm. -11- #932, March 9, midnight, from Stockholm. any change in present determination to continue war to the German industry and delivering plant equipment 0.8 end. He added that civilian population had identional attitude, largely because Allied propaganda of unconditional reparations. He said even a Derman child knew there no surrender and peace terms had been enormous psychological longer vas any German industry. Hr addrd that except for a panio-stricken, homeless and hungry civilian popula- misfire, He mentioned specifically the discussion of tion, entire Germany was a highly nobile war mochine partition of Germany, destroying its technical skill, functioning largely on its reserves and that only thing depriving It of stlf-government, sending ten million left in Germany after the war would be a defented and Germans to rebuild Russia (which he added the Russians destroyed war machine. Resse concluded by stating that destroyed thrmselves and bossted of It at the time) and to be perfectly frank, he considered the situation nors punishing var criminals. The latter, ht sold, hns been or less hopeless, that there were no surrender terms most striously o onsidered by civilian population and has - which Germans could accept with any assurance and no been construed (supported by propaganda) to Include any possibility of Allica agreeing to negotisted peace. That and all the thirty-five million Nazi party members. Ht in why, he added, ht has COME to Stockholm fully stated most Germans felt like hinself and that to support outhorized to make strongest plea for some agreement to his Government in time of war, whether It was right or enable balance of war to be fought without further whole- wrong, certainly was no war crime, Purthermore, be added sole sloughter of innocent and defenseless noncombotants, thr Otrunns had already found precedent in reports from BE closed by stating that while he realized difficultire Bulgaria, Rumania and Hungary 0.8 to what "punishment of war orininals" means when Russions have upper hand. It of getting prompt agreement smong Allits of any such broad program, he hoped something could be worked out has been used by them, he anid, simply 08 device to which could hardly fail to anve perhaps millions of lives. completely exterminate the middle and upper classes. Ht He stated the JEUS were not specifically advanced for added that at lenet Allies supplied touch of comedy to bargaining purposes and were not pawns of whatever these discussions and referred to proposals of dismontling developed from the discussions. He added his assurance German based RECISION MICROSTAT MICROFILM BOLL NO. 115 114 TREASURY DEPARTMENT INTER OFFICE COMMUNICATION COMP IDENTIAL DATE Mar. 12, 1945 -12- #932, March 9, midnight, from Stockholm. TO Secretary Morgenthau FROM Mr. Hgt based on personal knowledge of current German policy that Subject: The Business Situation, Germans had definitely abandoned any 10ca of mistrocting Week ending March 10, 1945 Jewa rurther and that they would be no worse nor better Sunuary off than any other civilian group in Germany at present. Stock market: Stock prices in the latter part of last week He said he had no reason to believe there would be any suffered the sharpest decline since 1943, and despite a moderate rally on Saturday the Dow-Jones average of 65 change in such policy. I would appreciate urgent instruc- stocks closed 2 percent lower than in the previous week. A revival of reconversion fears in view of rapid war develop- tions in matter and whether it is desired Olsen pursue nento in Europe, together with uncertainties engendered by talk of higher margin requirements and heavier capital gains his conversation with HERSE. Department may wish to taxes, were important factors in the decline. Industrial stock prices in London last week were firm. consider 08 safeguard against possibility of this dis- National income: Payments declined less than seasonally in cussion having been initiated for purposes of compromising January, and the annual rate of payments rose to a new high of $162.1 billions from $160.5 billions in the previous us with Russians, bringing it to Russions' attention month. Disbursements for military pay showed a further rise, while both cash farm income and factory payrolls decreased immediately. Olsen has impression he is somewhat under less than seasonally. a cloud in certain Russion circles (Communist) locally Coal situation: Reflecting heavy industrial denands end severe weather conditions, soft coal consumption in January rose because of post underground resour operations In Baltio, above 59 million tons to the highest level on record. In the face of heavy demands, noft coal production thus far in 1945 has run consistently below year-earlier levels, with JOHNSON cumulative output through the week ended March 3 falling 7 percent below the corresponding period of 1944. LMS Commodity prices: Futures prices broke sharply last Thursday on news of the crossing of the Rhine, but a rally at the end of the week recovered about one-third of the losses. Despite the wenkness in futures prices, spot markets showed practically no change. Cash whent prices have been strong at ceiling levels in recent weeks due to & tight supply situation caused by shortages of box cars, Apple purchase program: An apple purchase program has been announced by the WFA ns nn outlet for the large supplies of less desirable apples in the record storage holdings in eastern states. The apples purchased will be distributed to school lunch programs, charitable institutions and other approved groups. Regraded Unclassified PRECISION TRADE MARK MICROSTAT/ PAY. OFF. MICROFILM SOLL NO. 117 3 Stock prices decline sharoly The probable extent of outs in war production at the end of the way in Europe has been the subject of considerable After moving up to new highs for the year earlier in conjecture in recent months, but, on the basis of a statement the week, industrial stock prices on Thursday suffered the from the WPB early last week, any definite figures on out- severest decline since November 1943. The crossing of the backs at V-E day which have thus far appeared would appear Rhine by U. B. troops revived fears over reconversion problems, to be premature. Hiland 0. Satcheller, Chief of Operations while threats of higher margin requirements and heavier capital of the WPB, consented on probable outbacks in part As gnina taxes created additional market uncertainty. Compolity follows: *I have not yet seen the Army's military require- futures and second-grade bond prices also joined in the decline. ments for the period after the Geruan war ends, and I doubt Further sharp loases occurred in securities prices on Priday, that Ir. Krug has seen then in their final form, Until while the commodity markets stendied. those requirements are 1814 out on a table and screened, I don't see how anybody can guess at the extent of possible Stock prices rallied moderately on Saturday but at war production outbacks." the close the industrial and railroad stock averages were about 2 percent and 3 percent, respectively, below wek- Annual rate or theome payments shown further gain earlier levels. (See Chart 1.) The Dow-Jones average of 65 stocks showed A net decline of 2 percent during the Due largely to the usual December to January drop in week. In sharp contrast to the unsettlement in New York, interest and dividend disbursements, total income payments industrial stock prices in London n: the close of the declined in January. However, the decrease in total pay- week sere fractionally higher than a week sarlier. mente vas less than seasonal and the annual rate of payments rose to a new high of $162.1 billions from $160.5 billions WPB organized to handle outbacks in the previous month. (See Chart 2.) Disbursemente for in war contracts military pay during January showed B. further rise, while factory phyrolls and cash farm income declined less than As the Allied armies uove further into Jornany, concern sensonally. undoubtedly will increase over cutbacks in var contracts and inouic dialocations expected to follow the end of the war Total Income payments in January were 6 percent above in Europe. In this connection the W78 has outlined n. Dro- year-enrlier levels, with all major income componente show- STRE, effective immediately, for handling cutbacks in var 10g gains except payments for salaries and wages in commodity contracts. A Production Readjustment Countries, made up of producing industries (chiefly manufacturing). (Refer to representatives of the military services, WPB, mic and other Chart 2.) Payments for Government solaries and maged (1n- way agencies, has been set up to handle all unjor cases of cluding military pay) were 14 percent higher than in outbacks, not it is intended that all mesbers of this January 1944, and accounted for 19 percent of total income consittee be provided with copies of outbacks contemplated paymente during the month. by the military services. Standards for frince DAY increases established The allitary produregent agencies are expected under the teras of this uragram to give was plants at least 7 coys In view of the avoved intention of the WLB to maintain notice before the cut off date in All contracts involving the "Little Steel" wage formula for basic wage rates, con- more than $100,000 per month. Moreover, every effort is cessions to workers in recent unge disputes to an increasing to be unde to direct per sur orders into plants where extent have been in the nature of fringe awards. Since facilities and Inbor have been released by outbacks, stan- former Stabilization Director Vinson had shown & tendency agement, Intor and the WHO ore to be consulted where large to be less lenient than the WLB in granting these awards, layoffs are involved. AS part of the program, A new re- none observers have interpreted the appointment of Director porting service of 1dle sanufacturing facilities has been W. H. Davis AS foreshadowing a more liberal wage policy. set up and an "open capacity list" of plent facilities will While it remains to be seen whether this interpretation is be issued on n. bi-sonthly busis. correct, it should be noted that before retiring 0.8 Stabl- lization Director last week, Mr. Vinson issued an order establishing certain standards for fringe pay adjustments. Regraded Unclassified RECISION TRADE MARK MICROSTAT/ MICROFILM SOLL NO. 119 of commodities by the Government, had a weakening influence on distant cotton futures. (The current cotton purchase program is due to expire June 30 of this year.) The adjustments covered by the order relate to vacation With a tight supply position holding most commodity provisions, shift differentiale, cerit increases and the job prices at ceiling levels, spot markets showed little change reclassifications. While the order failed to grant last week despite the weakness of the futures markets. The WLB AB much Intitude in making fringe awards as the Board BLS index of 28 basic commodities receded a trifle from the desired, at the same time it represented n. relaxation of peak reached in the previous week. (See Chart 5.) Prices Mr. Vinson's previous stand against fringe pay awards. quoted for wheat, corn, and cotton showed slight declines. Coal output below year-earlier levels The BLS general index of wholesale prices in the week Kennwhile, wage negotintions continue between the ended March 3 recovered the small decline of the preceding week, rising 0.2 percent to equal its wartine penk. A United Kine Workers Union and the coal operators, with showing concern over the possibility of a work together with higher prices for livestock, was largely sharp upturn in the markets for fresh fruits and vegetables, consumers stoppage at the mines. Due to severe weather conditions in responsible for the rise, At 105.0 percent of the 1926 and heavy industrial demands, soft coal consumption average, the index 10 1.5 percent higher than a year ago January rose above 59 million tona. This was an increase and is 40 percent above the pre-war August 1939 average. of 4 million tons above the previous month and the highest the monthly consumption on record. Soft conl stocks at Wheat prices held at ceiling levels by beginning of March totaled 49.7 million tona na compared tight supply situation to 57.2 million tons A. month earlier. levels for the last four weeks due to n. tight supply situ- Cash whent prices have been at or close to ceiling In the face of heavy demands, and declining stocks, below soft year-earlier levels, with cumulative output through coal production thus far in 1945 has fallen consistently Cash prices in the Chiongo and Kansas City markets have ation resulting from box car shortages to move the grain. the week ended March 3 showing a decline of 7 percent from been largely nominal. Buyers have turned to the nearby the corresponding period in 1944. (See Chart 3.) May futures, which have been bid up almost 9 cente per bushel (5.4 percent) in the last four weeks. War news depresses compodity futures Hills are reported to be having difficulty in obtain- The crossing of the Rhine by American forces last ing whent, and in some instances have had to shut down for week touched off heavy selling in commodity futures, but short periods due to the lock of supplies. Complicating spot index last Thursday dropped 1 percent, the sharpest rally markets continued generally firm. The Dow-Jones the transportation problem, the Army was reported last week to have begun a program to ship between 120 million and futures day's decline in more than three years, but a The 140 million bushels for overseas uses in the next five or single at the end of the week cancelled some of the loss. six months, In this connection the CCC notified its index at the cless of the week showed a net loss of regional offices on February 23 to take over farm-stored 0.7 percent. (See Chart 4.) loan whent and warehouse stocks to put whent in export addition to favorable war news, another factor position ports. on the Atlantic Const, Pacific Const and at Guif tending of the American Parm Bureau Federation In to depress futures prices vsa n statement that by the Tightening lard supply a potential threat president that organization had decided against seeking legislation of to brend price structure to revise the door to inflationary demands by other before groups." a. the parity formula "because of the danger The possible effect of the tightening supplies of Moreover, opening Food Administrator Jones' testimony a lard and other fats on the baking industry and the bread Senate for supporting agricultural prices committee last week, in which he indicated with preference Government loans rather than outright buying and selling Regraded Unclassified PRECISION TRADE MARK MICROSTAT/ FAT. OFF. MICROFILM BOLL NO. 120 121 6 price structure has been causing some concern in recent - 7 - weeks. While production costs of bokeries have continued to rise during the past three years, no general increase in bread prices has occurred since the second half of Apple purchase program announced by the WA 1941. The increased costs of production have been offset to nome extent by lower distribution costs resulting from An apple purchase program was announced by the WEA increased volume and from the elimination of certain early this month as a menno of supporting prices and of selling practices. Moreover, price increases have been cermitted for cakes, and profite derived from this business facilitating the disposal of smaller and less desirable The have helped to unintoin bakery earnings. apples from the record stocks in eastern states. apples purchased will be distributed to school lunch If lard supplies should be reduced substantially, programs, charitable institutions and other approved the unkers' volume of business would very likely be groups. Purchases will be unde by WEA state field offices In all the eastern states from Virginia northward, and curtailed, particularly in the more profitable onke in other states if conditions warrant. Practically all lines. If profits should fall below those of the base years 1936-39, the OPA would be required to take action varieties of winter apples normally in storage at this to rectify the situation. This might take the form time of year will be included in the program. either of price increases or n subsidy. The OPA 1s The WFA will purchase U. S. No. 1 apples, 2 to 24 reported to be investigating the probleu, but nothing 1a inches in dinneter, nt $1. 50 per bushel, and combination likely to be done until the effects of the smaller lard supplies on bakers' volume and profit margins becoue U. sinimum dinueter, at 1.75 per bushel, both prices on an 5. No. 1 and U. 3. Utility (or better), 2% inches more apparent. r.o.b. care or trucks basis. The apples must be RFC food subsidies for fincal 1946 or secondhand containers. A small allowance will be cenerally fire ripe and pricked fairly tightly in new approved by Senate Committee unde for alight seald and deony provided that no single The continuation of the ment, butter and flour phakage contains more than la percent. subsidies, as well no rubber and metal subsidies by the While the apple crop Inst year me only alightly RFC, in fisoal year 1946 WILD authorized in e bill approved larger than avera e, the number of apples placed in by the Senate Banking and Currency Committee last week. storage WILD exceptionally large. Cold storage holdings (The Price Stabilization Extension Act of 1944 hanned in the slew England, Middle and South Atlentic states food subsidies of the consumer type after June 30, 1945 February 1 totaled 12,101, bushels, the largest on unless specifically authorized by Congress.) Subsidy record on for that date and more than double that of a year authorizations contained in the bill amount to 31,430 nil- The 1938-43 average for that date vin.o only lions, including the following: mest, 8560 millions: butter, *60* 9,810,000 bushels. An unusually large part of the stocks 3100 millions; flour $190 millions; petroleum and products, this year is of the swaller sizes, the result of last $290 millions; copper, lend and zino, $86 millions; rubber, numer's drought. 360 millions; and materials or commodities other than rubber produced outside of the United States, $80 millions. The response to the program thus far appears to have been quite heavy, Department of Agriculture Uncertainty concerning the continuation of the flour officials anid last week that more apples will probably subsidy has tended to disrupt flour soles in recent weeke. be offered for onle than the program can absorb. While Wills have been refusing to accept orders which they cannot the program can probably handle no more then about grind out before the current subsidy expires June 30. Unless 1,000 care, they indicated, it 18 expected to remove this uncertainty le resolved, flour production may be from the market most of the smaller and less marketable affected, Failure to extend the flour subsidy would prob- ably necessitate an upward revision in ceiling prices for apples. both flour and bread. Railroads hampered by severe operating conditions and manpower shortage railroads 1nst week imposed a 5-day embargo on LCL freight AO an aftermath of the winter traffic tie-upa, the Regraded Unclassified 122 8 shipments destined to points in the East, South and Middle West. All traffic moving on Government bills of Inding, na well no drugs and medicines, were ex- empted from the embargo, which was imposed to enable carriers to work off nn accumulation of LCL freight. While it WAB estimated early last week that the rail- ronds were about 5 days behind on LCL shipments in most yards, officials of the American Association of Railronds naserted that the Large backlog of freight shipments which resulted from the heavy winter storms FRB being stendily diminished. In addition to the swollen freight traffic volume, the reilronds in 1944 had by for the largest passenger traffic volume in history. In this connection, an official of the ODT foreonst last week that railroad passenger traffic will from heavier rather than lighter for several months after the end of the war in Europe. Among other features of the wartine railroad traffic boom, it may be noted that the taxes imposed on trans- portation of property and persons have provided very substantial revenues to the Government. In the colendar year 1944 the tax on transportation of property yielded $221 millions, while the tax on transportation of persons yielded $202 millions, This latter figure would have been 6223 millions had the current tax rate been in effect throughout the entire year. According to figures released last reek, total operating revenues of Class I railroads in January ran 1 percent above year-earlier levels, but adverse operating conditions and increased costs pushed oper- ating expenses 5 percent above those of the corresponding nonth in 1944, As 6. result, net rellway operating in- come (earnings after taxes but before charges) dropped 14 percent below the income in January 1944. (See Chart 6.) Net income after fixed charges is estimated to show a 12 percent decline. PRECISION TRADE MARK Chart Chart 7 STOCK PRICES, DOW-JONES AVERAGES Daily NATIONAL INCOME PAYMENTS AND COMPONENTS 1944 1945 1939 1940 1941 Def 1942 Now Des 1943 in Feb 944 - Apr 1945 # - = : 1 a is , as 14 " . DOLLARS , . 28 4 25 . E n DOLLARS Billions DOLLARS DOLLARS Annual Rote, by months Bhone 30 Industrial Stocks 170 ITO 160 OR 160 160 155 iss 150 150 150 140 ISO 140 130 130 145 145 120 120 140 140 no 110 54 54 100 00 20 Railroads 90 90 50 50 80 so 46 46 TO 70 A o D F A / A o o . AJADDFAJAODFA , 4 o 0 , A J A 0 D F a J A p 1939 1940 (94) 1942 1943 1944 1945 42 42 Dollar Totals for Selected Components, Jan 1944 and Jon 1945 DOLLARS DOLLARS Billions Billions 4.5 4.5 / 1944 Jan 1945 30 so 4.0 40 15 Utilities 3.5 3.5 28 20 3.0 3.0 26 26 25 1.5 2.0 2.0 24 N 1.5 1.5 SHARES SHARES 1.0 1.0 Millions Volume of Trading 2 2 5 5 I - o 0 Distributive Commodity Pro Government Not - Dividends Other - o o and Service duction industries Including of Programs and Payments . a. = - . . . . I 10 If = N . # If DE . . - = . : - a 1 . - - Industries (Chiefty Mig) rincludes Female internet Oct Nov Dec Jos Fas Mar Apr Saleries and Wegen 1944 1945 - deportment of - - # - - el - - al - - é - - Price - - Regraded Unclassified RECISION TRADE MARK MICROSTAT MICROFILM ROLL NO. 12 Chart 4 Chart 3 125 120 BITUMINOUS COAL PRODUCTION SHORT TONS SHORT TONS PERCENT I 104 of a 8 : # 97 и 95 1 93 92 = 26 = È Millions Millions : JULY 4 * ATOP . R 28 28 : and f JUNE - - : 24 24 ITR - - MAY - 1945 1944 = 1945 EFF a = APR 1945 20 20 - 16 16 COMMODITY PRICE INDEXES IN U.S. . a NTR 15 1942 . - to : Delly . FEE - a 12 JAN = 12 = - a DEC Commodity Futures = (Dow-Jones) . DEC 8 - 8 - NOW Moody's inder December N 03-00 to . U.S. § NOV. - . 4 4 1944 : : - oct 1 OCT. - x : o o JAN, MAR. MAY JULY SEPT NOV. SEPT SEPT. I I - Source Bureeu of Mines Other at the levery et the - PERCENT ( 270 267 264 251 258 255 252 246 243 240 237 234 231 220 225 - el - INVOICE 0-464-8 Regraded Unclassified WHOLESALE COMMODITY PRICES PRECISION 1944 1945 PERCENT PERCENT WEEKLY 1926-100 107 107 TRADE MARK 106 106 105 105 28 Basic Commodities BLS 104 104 103 103 889 Commodities BL S 102 102 101 101 100 100 JAN MAR MAY JULY SEPT NOV JAN MAR MAY 1944 1945 -- -- - - 127 5 Chart MICROSTAT/ REG.U.S.FAT.OFF. MICROFILM ON nos RAILROAD EARNINGS Net Roilway Operating Income". Class I Railroads DOLLARS Millions DOLLARS Millions 180 180 1942 160 160 140 140 120 120 1944 100 100 BO 80 60 1945 60 40 40 J935-39 Average 20 20 Regraded Unclassified o JAN FEB MAR APR. MAY o JUNE JULY AUG SEPT OCT. NOV. DEC Chart 0% - al the Serviary al - have *Earnings after - - Refere interest and aller freed charges - - - 0-483-8 128 $ RECISION TRADE MARK MICROSTAT/ MICROFILM BOLL NO. Xaning 129 130 TREASURY department 2 - WASHINGTON 25 March 12, 1946 Medical and surgical supplies totaling 116,000 separate Items, surplus from World War I, are being offered for mls. To: Secretary Morgenthau Is considering acquiring 390 ambulance bodies From: J. N. Pehle from surplus stocks. The Monarch Coin Machine Company of Chicago has purchased 895 electric training machine guns at $134.50 sach. These gune will be converted presumably to use In The following to a surgary DI significant develop- amazement contors. nante In the Surplus Proporty one Produce ant offices for the week ending Fabruary 24, 1948: a sales program LO baing developed with respect to 1,676 portable electric lighting chasts witch are designed Surplus Property: to hold insulators, polo brackets and similar equipment. A. spot saje or construction equipment et Fourney, In view of the inmovisability of mixing consumers Mebraska, resulted in the (isposal of 1,180 units for a and denlers at the name cale, we requested the Rural total of $450,000. The 0910 was attanded w approximately Electrification Administration to acvise its cooporatives 1,500 persons, representing 227 regular dealors In con- not to nend representatives to spot salos of construction struction aquipment. Additional apot 00108 of construction monthary. Arrangements have been M000, however, with the aquipment have been scheduled for February, March ano the Pural <lectrification Administration to supply its CO- first part of April. operatives with cortain or their negas by negotiation. The Any las nevined us or its Intention to withdraw We have nsked Mr. Troy to institute BD Investigation five million of the small Carlisle banks, which were the of Panco Corporation, Los Angeles, California, whose repre- subject surplus. of considerable publicity when offered for sale na sentatives are nilo_ed to be asserting that their company In the Treasury's agent for the disposal of surplus property. Allegations of much assertions have como from all parts of An analysis or the blde for the surplus Carlisle the country. dressings discloses that one high ofdder will, If an sward Is nade to It, the purchasing more than 1 million collarn' The Any has deciared no surplus automotivo equipment worth in terms of the Government's original acquisition cost. which it had lont to the Civil Air Patrol in Mevada. The Consequently It will be necessary to submit the transmotion Army Air Forces are not in n position to replace such equip- to the Attorney General for his approvel under Section 20 or ment and Arry Ordnance is apparently not willing to do SO. prepared. the Surplus Proporty Act. An appropriate report la being At the request of Sonator McCarran of Nevada, which request the come support of the Air Corps, WD are considering whether wa can make the necessary equipment available to the civil Air Patrol on B. loan or similar basis. Unclassified PRECISION TRADE MARK MICROSTAT/ MICROFILM BOLL NO. 132 131 - 4 - - a - Unusual requisitions for the week included 180 loco- We are collaborating with the Surplus Property Board in the formulation N° the Hoari's regulation with respect motives, valued nt $15,300,000 for civilian rellef in liboratod urons by UFICIA; 10,414,500 rezor blades, valued to priorities to Fadoral, state and local aguncies, and the designation or dispossi for particular areas and at $5,000 for Australia: 200,000 fish nooks to ne used on types of property. "croccan compretal Tighting coats; 44 tons of 11thium hydroxide for Presse: and 350 1on: toos of motallic sodium for Russie, to 14 was in the nanufacture of retails, hydrogon, and sodium A 30168 program 1s Doin Goveloped for surplus toxt books. cynnine. Unusual purchases for the wook included 052 medical A study is being Toda to vaternine what aguncy or taxt nonta for nas ber U. C. personnel In Chungling medical agencies should conr the responsibility of outerwining policies with respect T.O the unio of surplus property to training contern, and 4,400,000 cigarettes for Polish exporters or for export. In this comection It wisht De primoters or was to no distributed by the Red Cross. the noted that the Norwagian Embasy nis innicated an Interest Intter wire originally intended for a Swins company out were in purchasing certain types of proporty listed in tuo Icid tip in Lisbon of the in 1048. Bubesquently Surplus Haporter, and which to not transferred to Lasso- returned to the Uniton States, touce cigarattes were held Lond. in nond not the Forgign Coonomic Auministration. The exporter failed to tallo notion within a Ivoo time and the shipment We assisted representatives of "business Wool." In YALD abendoned to Customs. The yoreign Economic Administra- the preparation of on article on curplus property disposal. tien pronted 10 extrasion of one year to the exporter, pro- vidio the more sold to Trensury Procurement. A study is being TAUO to Naturnize mether existing 73.6 Irice asjustment Hoard "teposed of four 1943 cases statutes are anaquate to protect the curplus property dic- and one 1044 CASO, Exconsive profits amounting to $1,200,000 posal program seainst rulse advertising,us surplus proporty with 10 not surplus, and of false representations that were recovered. particular concerno are acting no events for government Instrumentalitios In the disposi of surplus. Vitar commultation with Foreign Sconomic Administration ruprosentalives, We ura properting to punnit If proposal to the ONLINE or to the Russian rafinery pro- Procurement: just to socure latter terms for the current plan than ware secured for carlier cues. Total purchases for the work amounted to $80,001,510.47, including $23,000,000 for Lend-Lesse (schudule attached) and We are continuing the atudy of the proposed allocation 261,510.47 for regular purchases. by the Potomac Viactric ,ower Company of the reduction in ratas 5 registros by the Public Utilities Commission. Carloadings or Lend-Losse material for the week totaled 3,174 cars. Regraded Unclassified RECISION TRADE MARX MICROSTAT/ MICROFILM BOLL NO. 133 At our request, P. Tray Fale instituted an investi- LEND-LEW Estion of clocking Reclaration Services, Inc., which to TREASURY DEPARTMENT, PROCURRMENT DIVISION under contract with un for the resabilitation of adid STATEMENT OF ALLOCATIONS, OBLIGATIONS (PURCHASES) AND FEB 26 1945 DELIVERIES TO FOREIGN GOVERNMENTS AT U. S. PORTS clothing. AS OF FEBRUARY 24, 1945 (In Willions of Dollars) The Department of Justice Telleves that the embilatory orders for shooting for the British Middle East requirements should be manaled under the Second war Powers Act, and ar Administrative Miscellaneous & Total U. K. Russia China Expenses Undistributed Production Board 130 atstad its willingness to process promptly with the Insurance of any obcessary directives if Allocations $5957.2 $2628.0 $2457.4 $ 172.8 $17.4 $681.6 10 with to de CO. Accordingly, Et letter vasa transmitted (5957.0) (2628.0) (2457.4) ( 172.8) (17.4) (681.4) to the Attorney Janeral seeking nie assurance that the Department of Justice will procesd promptly with any noces- Requisitions & 127.3 8 21.8 8 21.5 $ .2 - $ 83.8 any enforcement action 12 orders are placed under the in Purchase ( 156.9) ( 22.61 ( 21.8) ( .8) - (112.1) Second War Powers Act. Requisitions not = 118.1 3 22.7 5 39.1 $ .? - $ 55.6 Cleared by W.P.B. ( 116.9) ( 25.6) ( 37.8) ( .?) - ( 52.9) Administration: Obligations $4700.5 $2087.4 32062.8 1 104.8 816.9 $429.1 (Purchases) (4671.7) (2083.8) (2044.3) ( 104.3) (16.7) (422.6) Strentions afforts are 0010 Fisca to auequate Deliveries to Foreign 82991.1 $1618.3 $1291.4 8 26.4 - $ 60.0 opner in Philmusipoia for the new bandquarters of Implon 3. Governments at U. S. (2968.6) (1608.9) (1274.7) ( 26.4) - ( 58.6) Porto* =Deliveries to foreign governments at U. 5. Ports do not include the tonnage that is either in storage, "In-trensit" storage, or in the port area for which actual receipts have not been received from the foreign governments. Note: Figures in parentheses are those shown on report of February 17, 1945. 134 Regraded Inclassified RECISION TRADE MARK MICROSTAT/ REG. M. 5. PAR OFF. MICROFILM ROLL NO. 136 135 No. 21,635 Lenden, March 12, 1945 BY AIM FOUCE Xconomic Varfare (Plack (1nt) Segies: No. 595 JB March 12, 1945 Distribution of true Subjects Ministry of Tennemic Verfare's letter reading only by special 6 p.m. to Putch Government concerning pronosal arrangement. (SECRIT N) to Tannom Dutch Jews, Confidential - For VP AMIRGATION The Honorable The Secretary of State Weshington, D. c. 1028 Sir: The following for McClelland 1a TRB 446. I have the honor to refer to this Fabruay's No your 1354, March 2. UNRRA here informs us that telegram 1403 of February 8. 1945 concerning - correspondente in this country are addressing their mail and poral the to 1800 Jews of Datah origin in Permany pro- to the category y (repeat F) group exchanges at Philippe- to Department's tolagram 1593 of March 7, and ville All follows: Department 8, - copy of the Ministry's letter of Hereh transmit herewith for the information of the e/o Jean d'Aro Refuges Camp to the Dutch Devernment en this proposal. Philippeville Algeria Respectfully yours, for the Ambassader: Lier of those exchanges who actually arrived at Philippe- ville will reach you via airgram. Denald 9, Calder Third Secretary of STETTINIUS Aconomic Verfare Division (0LN) énclosure: 1. Copy. letter - noted above. (Ferwarded In original and hectograph) Surcessed Pistribution: Var Befuges Beard, 711.3 AMA:KOT Regraded Unclassified PRECISION TRADE MARK MICROSTAT/ No. V. PAT. OFF. MICROFILM BOLL NO. 137 15-017 138 PLAIN PO Harch 12, 1945 Lisbon Instribution of true reading only by special 11 p.m. Dated March 12, 1945 arrangument. (SECIET w) Rec'd 7:30 a.m., 13th Secretary of State Har Befuges und Washington AMENDASST LONDON 536, Twelfth 1905 me 354 F.R HIAS 425 LAVATETTE STREET NEW YORK The following for liann is WHB 56. FROM DAVID SCHNLITZER HICSM Reference 18 nade to Polish Har Refief project. Labor Complying with merous demands relatives America proups here have requested information concerning status of and England on our request office Bucharest will now the $150,000 remitted to London in two installments of $75,000 transmit full addresses inquirers Roumanda instead of each. Please advise urgently whether any part of this amount general address care of Zingher. Only reason preventing has been released to Polish trustees in London and obtain from before office Bucharest doing so was economy. the traateer as BOOD as possible their proposals for the use of those funds still available to the trustoes in London for Inform Sugare Oarstmann, 205 West 88 Street, New York Maurice Thal this project. bakkähgun total financial help and telegraphic permission For your information, replise to the foregoing inquiries unding one room his flat. Ours January 26 Rose Mirechmann are needed innediately in connection with efforts of the your February 19 Prederick Passy identical case inasmuch labor proupe to obtain an additional allocation from the address Prederic Passy Street Plais liew York National Sar l'und for their very successful Horwegian project Nice ask lossen Axalrood 9 Vesta Road, Dorchester 24 which now faces termination because of lack of funds. Massachusetts send parcel food and financial help Marine Amelrood six cite Condorcet Paris, Inform Princess Cira Motehoubey POB Centralia Illinois father Vladimir STETTINIUS Balacheff healthy nine Avenue Aims Martin nine request (GIN) financial help and secure USA visa. CROCKED 175 par.2 lines 2 and 3 York Maurice Thal 10 quentin Bauchard Street Paris healthy. Mike financial help and telegraphic permission 10.00 Chancey (for the Secty), Aksin, Cohn, DaBois, Gaston, Hodel, Rutchdson, DeCormack, O'Dwyer, Files Regraded Unclassified PRECISION TRADE MARK MICROSTAT/ REG. u, 5. PAT. OFF, MICROFILM ROLL NO. 140 PARAPIRASE (F SENT CABLE TO WINAST, LONDON, FOR MANN FROM RAB REFUGE BOARD mous Secretary of State, Washington Reference is made to Polish war helief project. Labor groups here have TO: American Political Advisor, Casorts requested information concerning status of the $150,000 remitted to London DATED: larch 12, 1945 in two installments of $75,000 each. Please advise urgently whether any part NUMBER: 210 of this asount use been released to Polish trustees in Lossion and obtain from BOUT the trustees - BOOD as possible their proposals for the use of those funds still available to the trustees in London for this project. In reference to your 719, February 27 and 751 of l'eterary 28, For your information, replies to the foregoing inquiries are needed the Har Refuges loard 18 not represented by Jacogaon. The Depart- immediately in connection with efforts of the labor groups to obtain an nent las not approved his entry into Bungary. additional allocation from the National Bar Rund for their very successful The validity of Jacobson's passport includes Portugal, Spain, Norwe,ism project which now faces termination because of lack of funds. and Turkey and does not include other continental European countries. STETTINIUS THIS IS 428 LONDON CABLE NO. 56 11,00 a.m. March 12, 1945 Filand 3/10/45 Regraded Unclassified 142 141 CABLE 20 AMERICAN CONSULATE GENERAL, JESUBALEN, FROM THE WAR REFUGES Board CABLE TO AMERICAN LIBASS?, PARIS, FROM THE WAR REFUGE BOARD Please deliver the following message to the Joint Distribution Please deliver the following message to Arthur Greenleigh from 4. A. Lesvitt of American Jewish Joint Distribution Committee: Committee from 4. A. Leavitt of American Jowish Joint Distribution QUOTE No. HAVE NO RECORD ANY AMOUNT OFING BERE BASKIND. Committee: so DEPORTATION POLISH CLAIMS RECEIVED AFTER FEBURARY 1940. UNQUOTE quote we RECEIVED POLLOWING CABLE FROM MOSCON INTERQUOTS. TWOHUNDRED PIFTTHOUSAND POLIENTSH EVACUES NOT LIVING IN SOVIET UNION. PLEASE ISSUE OFFICAL QUER 20 DETAIN Il USSR FOR our COMITYTEE APPROPRIATE PART OF SHIPMENT SENT 201 POLISH JUIS. ORGANIZATIONAL COMMITTEE of POLITINE Ill USSR MOSCON FUSHICIONATA 5 120 FINKELSTEIN RARBI TRANSTIAN LOSES BROBERSON B&R MARK IDA KANIHSKA DOCTOR DAVID STARD DOCTOR JACOB RABBI SOROOXEL JUSEKIENICE GLINERAL SECRETARY UNION POLISH PATRIOTS F.D INTERQUOTE OUR POSITION DETIRIORATION or AMOUNT SUPPLIES TO BE IEFT FOR DISTRIBUTION SOVIAT UNION SHOULD BE DETENDING BY EMIL SOMESTEIN AID ABOVE COMMITTEE. ITIL YOU ADVISE UD MOSCON ACCORDINALY AID REQUEST THAT E DE KEPT ADVISED REGARDING PROGRAM AID DISTRIBUTION. ASSURE YOU WILL ADVISE PASSMAN. UNQUOTE 2:45 P. n. March 12, 1945 2:45 P. m. March 12, 1945 REGI: 3/12/45 REM: 3/12/45 Doaradad Unclassif RECISION TRADE MARX MICROSTAT NIG. PAT. OFF. MICROF NOT TO BE BE-TRAUSHITTER 4 COPY NO. SECRET OPTEL No. 81 Information received up to 10 S.E., 12th March, 1945, NAVAL 1. MEDITERRANEAN. 9th/10th (night). Coastal forces sank 85- corted ship of 2,500 tons west of Istris. K0-816 PLATN Liston boat 2. west of Scillies from which survivors picked up. Promising ANTI-SUBMARINE OPERATIONS. 11th. U.S. Liberator sank U- attack made by 10th Escort Group off Beachy Head, Midget submarine Dated Murch 12, 1945 sunk off North Foreland by one of H.M. Frigates who took two Rec'd 7:28 M.M., 13th prisoners. MILITARY 3. WESTERN PRONT. Secretary of state South Central Sector: Clearing of area north of Hiver Moselle and west of River Rhine continues while further north mashington Renagen bridgehead now expanded to breadth 9 miles and depth 3 miles. Northern Sector: Resistance in Wesel bridgehead ceased on 10th when U.S. and British troops nade contact opposite Vosel on 535, Twelfth west bank of Rhine. Allied troops now hold west bank of Rhine from its junction with Moselle to opposite Tiel (20 miles west Nijmegen), THE 353 JUC FOR LEAVITT you MARGED TROBE with exception of some 3 miles Addernach. wish advise Saly layer paid account Coarge Deberall 4. EASTERN FRONT. Central Sector: On northern flank advances nade on east 350.000 Sales france account 55 TOROS passages making bank of Vistula to within 19 miles S.E. Danzig, while to nest pro- gross also made and troops within 11 miles of city. Further vest total paid from special fund 1.518.500 Swine france. Germans claim to have prevented expansion of Russian bridgehead over River Oder, South Kustrin with exception of slight penetrations, CROCKER Southern Sector: In Hungary Germens clain further pene- trations both sides Lake Balaton while Russians admit hard fighting ITS this aron, particularly at N.E. end of lake shere large tank and infantry forces engaged. Further south Germans claim to have held against strong counter attacks bridgehead which they had prevbusly gained over Lower Drave. 5. Central BURMA. Sector: Myotha captured by troops from Myinmu bridgehaad, while further north leading elements in Mandalay have reached Fort Dufferin, Northern Sector: Our troops have captured Mong Mit. AIR attacked 6. Essen (4738 tons) through cloud 11th. U.S. heavy bonbers WESTERN FRONT. 1053 Bomber Connand aircraft (3 missing) 1220 (1 missing) attacked oil refineries hanburg (1107 tons) and U-boat building yards (1692 tons) at Bremen and Kiel. No enemy fighter seen. SHAEF (Air). 840 medium bonbers (2 missing) dropped 1300 tons comunication targets and airfields painly central Sector, with unobserved results, while fighters and fighter bonbers flow 1140 sorties for loss 6 aircraft over whole battle front in poor visibi- lity. Coastal Command Mosquitoes attacked navigational nida Nor- wegion coast, 11th/12th (night). 123 Bomber Command aircraft despatched including 90 Mosquitoes Berlin. 7. heavy bonbers attacked railway bridge 4 miles N.T. Verona (642 tons) WEDITERRANEAN. 9th/10th (night) and during following day shere several probable hits reported, while 978 tactical aircraft attacked enemy communications and other targets. 3, BURMA- 9th. Liberators dropped 243 tons on bridges and Sumps Southern Burna while 300 other aircraft attacked targets central area. HOME SECURITY 9. ROCKETS. 11th. Two further incidents reported. 11th/ 12th (night). 11 incidents reported. RECISION MICROSTATI MICROFILM ROLL HO. 145 - 2 - 146 March 13, 1945 12:13 p.m. HMJr: HMJr: Hello, Cont'd. an a matter of courteay, : gave him a memorandum about the Fiscal Assistant Secretary, which VAS Bob created about four years ago for Dan Bell. It's Hannegen: Hello. a Civil Service appointment. Now, : could appoint the person just no much as I could appoint an HMJr: Good morning, Bob. Administrative Assistant. You see? H: Yes, sir, Mr. Secretary. H: Yes, sir. HMJr: Ye had A good meeting out in Minneapolis. HMJr: But as 8 matter of courtesy, I just didn't want the President or you to pick up the papers and H: I read about it. non I'd appointed an Assistant Secretary. HMJr: I SAV our old friend -- is his name Premer? H: Uh huh. H: Yeah, Otto Brener. HMJr: Now, the thing is I'm putting Eddie Bartelt in there with the understanding that If and when : HMJr: He said it's the first time In seven years he's ever get out of here, he'll go back to his job, come out to 4 meeting. and that job vas created by Congress for Dan Bell. See? H: the huh. H: Yes, sir. HMJr: Re's a nice old fellow. HMJr: Now, the reason -- I haven't got the exact language, H: Oh, be certainly is. but you'll have to take my word for it. HMJr: Yeah. It's the first time in seven years. H: Un huh. R: He's been a good -- he's been a pretty good HMJr: I mean, I have just as much as you had over there Roosevelt man, too. to appoint one of your assistante when you were with the -- you know. HMJr: Yeah. They stopped selling tickets at ten o'clock H: yesterday morning. Yes, sir. H: 17h huh. HMJr: And it has to be within Civil Service. Well, the President referred it to Jim Barnes. HMJr: It vas a sell out. E Uh huh. H: Well, that's great. HMJri And Barnes just called ne up and said he wanted to HMJr: And I think we'll get all the papere there for us. sit down and talk to me about it. And I said, "Well, what 18 there to talk about? It's a Civil Service H: Uh huh. appointment." HXJr: That 18, the Ridder's and the Cowles'. H: Uh huh. H: Uh huh. HMr: See? I mean, it's wholly -- it's just the same as appointing Charlie Bell as my, Administrative Assistant. HMJr: The reason I'm calling you 18 this: oh, ten days ago, going up on the train with the President, H: Yes. Regraded Unclassified - 3 - 148 147 - 4 - HMJr: Re doesn't have to be confirmed. It 10n't 5 Presidential appointment. H: : will call his right away. B: Yes. HMJr: Will you do that? HMJr: The law says to be appointed by ne." H: Yes, sir. H: Yes, sir. HMJr: Because if it V88 a political appointment or had to be confirmed or anything else, believe me HMJr: : wanted you to know about it. I'd go to you. H: That's fine. H: Oh, sure. HMJr: And I I -- as I HMJr: And I only vent to the President as a matter of .... courtesy. H: I'll call that Jim Barnes right away. H: Yes, sir. Say, I got a favorable note from the HMJr: Call up Jim I mean, I .... President this morning about going ahead with -- with this Conference of Governors. H: Oh, he's a little daffy anyway, HMJr: Oh, fine. HMJr: A little what? H: A very nice letter. H: (Laughs) HMJr: Fine. HMJr: Yell, he said, "Come on over; I vant to talk to you." I said, "Well, Mr. Barnes, what would you H: And suggested that -- you know this fellow from like to talk to ne about?" I vas very polite to up here in Maryland, I think he vas -- I think him. See? he was chairman of the Governor's Conferences, and I'll try to get -- he's close by -- I'll try H: Uh huh. to get him to come down here, and maybe we can telk with him. HMJr: So he said, "All right, I'll just tell the President.* HMJr: And you know this 1s just between us -- that H: Oh. the day after I BOW Ickes. HMJ: Well, that's no way, you know. B: Uh huh. H: No, hell. HMJr: .... when -- after I'd come to your meeting. HMJr: What? R: Yes. H: No, I'll call him. HWr: He practically wouldn't talk to me because I'd come over there. He VIII no nad at me. HMJr: That's no way. I mean -- go back and tell teacher right away. H: He vasi H: That's right. HMJr: Yeah. HMJr: What? H: Well, why? - 5 - 149 - 6 150 H: HMJr: And if there are any leaks about that meeting, That's fine. you can be sure where it comes from. HMJr: See? R: Oh, yes. H: Yes, sir. HMJr: Yeah. HMJr: R: Well, I'm going over to see him. President. So this 18 a matter of courtesy to you and the 5: HMJr: Yeah. Thanks a lot. H: just as soon AS I can, and -- and talk with HMJr: And if you'll just say something to Barnes him because I want to try to -- I think he has an obligation the same as the rest of us. M: I will do it right this second. Yeah. HMr: HMJr: And I get along fine with you. You know, I've never met the fellow. H: And I want to tell him so, H: Uh huh. HMJr: Well, as I say it's -- he .... HMJr: Bernes. H: Well, he had Abe Fortas over there. Ht Yes. HMJr: I know he did, but I just -- I thought he was acting -- I thought he VAS acting like a child. HMJr: I don't think I've ever net his. You see? is Uh huh. E Well, he got himself all sixed up. : tried to HXJr: be helpful to his, and I told you about that See? appointment that he tried to get the President to make in a hurry before be left, on Congressman H: I'm going to call him right when I hang up here. Jed Johnson. HNJr: Thank you. HMJr: Yes, H: Hello, Hello. H: And he just irritated all those fellows in HMJr: Congress. Yes, HMJr: The girl has just brought in -- it's an excerpt ** I hope that before long we'll get that report from a message from the President of the United through with that fellow Pawley. States, transmitting 8. reorgenization plan No. 111, April 2, 1940, which reads as follows: "To HMJr: I know. I haven't forgotten it, and .... assure continued effective management of this highly important technical phase of the Treasury H: It #rene that -- I'm sure getting myself murdered functions, I an placing the fiscal service under because of that. the supervision of a career official. The plan, therefore, provides that the Fiscal Assistant HMJr: Well, Bob, I haven't forgotten. Secretary vill be appointed by the Secretary of the Treasury in accordance with the Civil Service R: No, but you see what they're doing with the guy -- laws, and will perform his duties under the general he's paid & lot of money to get lawyers to be sure direction of the Secretary.' Regraded Unclassified PRECISION TRADE MARK - 7 - 151 152 March 13, 1945 12:22 p.m. H: Cont'd. that his tax was all correct, and now he -- he has to go back and get his records out from 1932, and HMJr: Hello, Ted. he said it cost him $10,000 to go ahead and do that. Ted HMJr: Yeah. Gamble: How are you, sir. H: And -- well, : talked with -- : had . talk with the HMJr: Everything went off beautifully. President last veek about a. number of things, and I told his -- I mentioned this one, and he said, 0: Well, that's fine. well, he would probably get the report from -- from you pretty soon. HMJr: They turned people away from ten o'olook on yesterday. HMr: Yeah, well, we've got it and we're doing the best we can under the circumstances. 0: Yes, till Okay. Thank you very much. HMJr: And attentive. your fellow Arnold couldn't have been more HMJr: All right. G: Re's a very sweet fellow, H: Bye, HMJr: And 0: Re's 8 very considerate fellow, and I think will do you a lot of good out there. HMJr: There was only one thing that -- that wasn't right and : know it would displease you. It had nothing to do with no. 0: Yes, HMJr: I want you to get it directly from George Little. G: Yes. HMJr: They had a meeting staged there for people -- for 500 or more people 0: Yes. HMJr: Un -- payroll deduction. G: Uh huh. HMJr: And they had Olrich address them. O: Yes, HMJr: Well, he talked to them just as though these people were 80 many alaves. Regraded Unclassified 153 - 3 - 154 - 2 - 01 Yes, I will talk to Herbert. Gt Uh huh. HMJr: But I know it's what you and I don't want. HMJr: And the whole attitude was wrong. Now, in the first place, no women were there. and I happened 0: to bring Mrs. Morgenthau and Mrs. Vell, Secretary. It's what we have not had either, Mr. who 18 a very nice lady. HMJr: Well G: Yes. G: Practically every .... HMJr: After all, fifty percent of the payroll people are women. There were no labor people there. RMJr: .... it vas just like crecking -- cracking the whip over a lot of slaves in a galley boat. G: On - oh. G: Vell, I went to a labor meeting Saturday in HMJr: And they just talked like a. lot of hard boiled Philadelphia, and had just the opposite. I N.A.M.s -- "You fellows have got the business talked to them myself, and we had .... and you've got to make 'em produce, and you've got to make 'en come across, and God damn it, HMJr: It -- I'll tell you, Ted, it's something that it's up to you to just make these fellows buy you time. and I have personally got to watch all the the bonds." 0: G: Un huh. Vell, I'm amazed at Olrich. HMJr: HMJr: Well, now, that 1sn't what ve vant. Clrich is terrible. G: Well, that's a curious thing because we've bed 0: I would have thought that his short stay down such a .... here would have -- at least have broadened his views a little. HMJr: And Herbert Gaston was there, and he vas very much shocked, and it Bee3a that there's a fellow HWr: I'm effect. sorry to any his contact with se had no good there by the name of Pack. G: 0: Robert Pack. Had no good effect on him. (Laughs) HNJr: HMJr: Yes. But the rest of the arrangemente -- I mean, this had nothing -- this meeting vas arranged irrespective : He's a Northern States Power san. of my coming. Yeah, and who evidently has very good labor 0: HMJr: Yes, that's right. It had already been scheduled. relations. HMJr1 And I talked a little after his and I was very quiet. 0: Yes. I realized it vas a tough spot, and all I said to them was this, "Gentlemen, I've been around the HMJr: And Clrich went out of his way to take a couple country a lot where there are good labor relations of dirty cracks at him. See? with management, and management gets along with labor. You don't have to worry about war bonds." G: Yes. G: Or production either. HMJr: Now, I don't know the background, but I think maybe if you'd telk to Herbert rather than Little 0007 - 4 - 155 156 - 5 - HMJr: Well, I didn't any that -- which is the onme thing no the set-up there -- and I voe very quiet, and HMJr: But everything -100 out there vas swell, including they liked it. I ent next to the head of General the grandchild. Mille and they liked what T said. I said, "You've got to have this relationship between management G: Vell, that's good. I vas going to ask you that. and labor, and then you can sell war bonde. If you don't have it, you can't.' And : said it very HXJr: Vell, it couldn't have been a more successful quietly, you see? meeting. G: Well, their only excuse for using Olrich, really, 0: Well, I'm glad to hear it. was that they thought he would have more of our point of view. It's a shame. HMJr: And we got both papers -- we got both the Ridder's and the Cowles' are going to be with us. HMJr: Vell, I'm -- I want you to talk to Herbert. 0: Vell, I will talk to him. 0: Yell, that's awfully good. HMJr: HMJr: Yeah. Because when this thing dones up, it has to be handled; but as to my own trip, it von 100% successful, and I can't say enough nice things about George Little. 0: Because that's an influence through that whole country. G: Well, that's fine. HMJr: Yell, both the Cowles' and the Ridder's are for us. HMJr: Now, one other little thing: if you vill diotate a letter for ne to write to Vice President Trusan .... 01 And these fellows won't vote against them, I don't think. 0: Yes, HMJr: HMJr: Bo the meeting in general vos most successful. I will send it up to him myself. 01 Fine. 01 Well, that's good neve. HMJr: Thank you BO much. HMJr: If you vill send it over this afternoon. G: All right, sir. Bye. G: Fine. Now, you have seen the memo that I sent over HMJr: Yes. G: .... on the Truman matter? HMJr: That's why I'm asking .... G: I'll follow that up with n. letter. HMJr: If you would. G: All right, sir. RECISION MICROSTAT/ MICROFILM 158 - 2 - - 157 March 13, 1945 1:00 D.M. Lt All right. HMJr: HMJr: But definitely get this 1:30 meeting called off. Lux, this 10 important. I just called up Jesse Wolcott nee? just to ask how things were going. You L: I'll do my best. Ansel HMJr: Yell, we have to do it. Luxford: Yep. 1: I'll do my best, Kr. Secretary. HMJr: And he said things were going fine, and he said HMJr: Mell, I know, but I mean, you can use my name and Harry was keeping his temper, and everything was Wolcott's. Tell him I recommend it. fine, but he Bold they called a meeting for 1:30 this afternoon of the committee. L: All right, I shall. L: Yeah, HMJr: See? HMJr: He says it's a mistake. It's irritated the Lt You bet. Republicans. They want to get this Lend-Lease thing out of the way, and once it's out of the HMJr: I don't think you'll have any trouble. way, It will be helpful to Bretton Voode. Li I don't either. I don't invision .... L: Yeah. HMJr: Yell, I want you -- I tried to get O'Connell. HMJr: And be said he wishee that we could tactfully I tried -- White's down in the restaurant. get word to Spence not to call the committee O'Connell's over at the other place. together at 1:30. L: All right, sir, I'll take care of it. L: Today? HMJr: I'm sure you will. HMJr: Today. Hello? L: Right away. L: Yeah, I've got it. HMJr: Thank you. HMJr: So that they can finish Lend-Lesse on the floor: He said the Republicans won't come. They just Harry won't have a -- people there to listen to him. L: Uh huh. HMJr: And he said It's just irritating them. If we could call off the 1:30 meeting, he would appre- vill. clate it, and it would be in the interest of good L: Could I use -- could I use Wolcott's name in con- nection with this, Mr. Secretary? If I can, I can get Spende to do it, I believe. HMJr: Well, use your own judgment. Regraded Unclassified 159 160 March 13, 1945 - 2 2145 p.m. MR. C.S. BELL: little bit today. BANICH'S VISIT E.H.JK: This is super-duper confidential and I an Present: Mr. D. %. Bell terribly worried and I just don't know how to handle it, Mr. Luxford but for God's sake, no leaks! Baruch has been here for Mr. C. S. Bell about an hour and three-quarters, and be claims that he Mr. O'Connell has been asked by the President of the United States to Mr. DuBois go abroad on the reparations question. I have no question Mr. Coe that he has been asked that, lie said he has been to see Mrs. Klots Stettinius, but he doesn't want to go unless he gets plenty doesn't H.M.JR: particularly concern you, but if you are interested, Charles, I am glad to have you stay. This of kudos and an invitation from Churchill. From the question but from a little 1 am picking up here and there, there is he asked ne, I don't think that he has been told everything, you can stay. has seen Taylor's letter? no question in my mind that--of those who are here, who C.S. BELL: Yes, sir. H.M.JR: And I wanted the people it did concern to be IR. DUBOIS: I have. here. It's wholly a matter of foreign affairs. MR. 008: Yes. MR. C.S. HELL: I have some other things 1 can do. You are not going to be able to do it. I do On the reparations question, the question of treating criminals H.M.JR: Well, it's available through your (Coe's) office. it backwards. H.M.JR: I mean, I don't need--I did invite Blough piece together that there vas no settlement. What? and the economic treatment of Germany, I an beginning to or Gamble. MR. 008: That's right. 10.0. S. RELL: I understand. E.M.JR: So, this doesn't concern you. because he was trying to fish with me, but there is no question B.H.JR: Now, I don't think that Baruch knew It all VR. C.S. BELL: Do you want ne to go? about his being asked. lie gave me a document to read which H.M.JR: No, you can stay. President but the President wouldn't give him a chance is his presentation, and he said he tried to show it to the the German question, and the gist of his thing is we must on MR. C.S. BELL: I would love to stay. So not build up Germany industrially in order to pay reparations. of the suhr coal because they can nine it cheaper to doesn't imos whether he shouldn't let the English have some far, so rood, but he gets off on complete tangents. lie MR. LIXFORD: Just to see the boss. If you want to go, raise your right hand. too You meet world competition. I find the man's mind wanders. He can always H.M.JR: stay. You are always invited. Am I talking him to the extent of Lubin heading the whole thing. agree I He thinks it is a great mistake about Lubin. I with doesn't concentrate. Be had great difficulty in hearing. loud? Regraded Unclassific 161 162 3 but-- H.M.JR: Hello, Dan. I'm sorry I can't back-track, don't think--I think Lubin is a good statistician. I wouldn't say he is a great statistician. but no's a good one, because I have seen him and he is good. but he's correct. If we put a nan like Lubin in, other governments will put men In late. MR. D.W. PELL: That's all right. I'm sorry I was at the same level. B.M.JR: Joe Duboia will tell you what I said before. YES LUXFORD: lie mon't fit, Mr. Secretary. MR. DUBOIS: Yes. H.K.JR: And he said to have Lubin there--he Isn't going to - unless he can really supersede Lubin. The B.H.JR: The nan me are talking about is Baruch, and nove is on. Lubin asked him to help him net henderson this is extremely confidential. Ae is all right on this to en as his assistant, and he hates Henderson, and he German business. I sent Chernell un to see him and Chornell said on the HILL it would be terrible. No one noticed is «11 right on this, and he is counting greatly on seeing that It was he--this is in the room here--that kept Chernell. of course, he is great friends with Churchill, lienderson from speaking during the compaign for Roosevelt. and Churchill has asked him to CO over there and make a It's awful. He keeps golor off and you have to keep getting speech. Another thing he said when they attacked Churchill him back to the thing. It's very trying. How, be sent word so on the Greek business,he got on the telephone and called here about ten days are that he wanted everything I had the publishers and editors all over the country in order to on Germany and did nothing about it. be sald that if get them to stop attacking Churchill, and harry Hopkins he goes, he wants the President's plane because he gets thanked him for the great 10b де did. seasick. That's a good reason to have his plane. He is taking his little trained nurse, his valet, and a Now, I can't tell. As BOOD as 1 see Stettinius, I nan by the name of Libell. will find out what the low-down is, because he has been to see Stettinium and was frank enough to say before N. O'CONNELL: The same Lubell? Stettinius = ould talk to him, Stettinlus called the President, and there is a lot of--he has none to the President H.N.JR: he wants sonething from over here to find and recommended that State, War, Savy and Treasury head-- out what we got, see? Now, what I think he is trying to 1 couldn't quite get the overall committee on this business do is build himself up, and : gave him DuBois' name. You with Jimmy Syrnes, but Jiany Byrnes is holding back because have to kind of feel your way. I wouldn't suddenly unturden myself. On the other know, I told him about Taylor and he preside. mants to preside and he is afraid Byrnes is going to Bernatein and if be ment--Ine, If he took $ liking to you, I nould let you C° with him, because this is important. VR. D.W. HELL4 liho is holding back? M. DUBOIS: That's right, this la very important. E.N.JK: Byrnes, because he wants to preside instead of Stettinius. He said he didn't know just where he would h.K.Jat This is very important and If you could fit into this picture, and he wants San Rosenman as General sell yourself to San Lubell, I would encourage you to Counsel to this wommittee, and he said be asked the President no with hin because you see be calls It the "Morgenthau if it mould be all right to talk to me, because he felt that Plan" and will be calling it the "baruch Plan" pretty soon. in the final analysis the Treasury would play the most (Ite. D. 1. Bell enters the conference.) Regraded Unclassified 164 163 - 6 - B to Surope. That I can understand. be won't 2° to Moscow. Somehow or other he knew about Bernatein. Ee didn't know important part in this thing. Be said in the long run about Taylor. Be said he thought San, Hosenman's trip we inherit all of this stuff anyway, and the President sald, was a great mistake. ne out scross a lot of people. He said that San Rosenman is crazy to be General Counsel Yes, we talked to the President about the "Morgenthau Plan" and be said, well, Henry was right, but he has a to this Cabinet Committee of five--that's what he would little bit too previous. but Just what this Committee like. I asked if he would talk to Walter George for me on Bretton woods, and he didn't answer ne. lie said vas to do, : couldn't quite understand, except that It would sort of be an over-all Committee. San Losennan was he hadn't seen him for a long time. He got that in. To to be General Counsel, and I gether Baruch was to be the sum up,I don't think this Conmittee in very important yet, guiding spirit. That's about the way I not it. It maan't but on the reparations thing he made up his mind that that is more important than anything clse, and he will work too clear, and the man's mind wanders, but fundamentally he's all right. You don't have to begin to sell him. through his avenues to see that everything is held back, if be can. He said, "Can you set Krook on it?" I said, For once I agree with Krock, in regard to his article about Sunday he san Stimson and he called him the Bishop Crowd. Be said what's his name--Churchill--has trouble Crowley, pyranid on pyramid. I want you to tell ne about with the Bishops and Stinson La one of then. He thought It sometime. So he said, "Did you see that little piece he nade some headway with Stinson and be claims--he said about Lubin at the bottom? I gave Lubin my documents. he was going to send me a 0007 of It. You might ask him Lubin said he met Zrook on the street, and off the record, that. He proceeded to tell me he went to the State showed it to him on the street. That's where Krock got Department and addressed the whole proup on Germany with it from." (Laughter) a written nemo. He said he would 1st ne have a copy, and But, I think, Joe, that you are smart enough. I hope he said the only fellow that asked his some questions le the White bussian over there. you are-- VR. LUXFORD: Pasvolsky. Vit. LUXFORD: That's a good way to put it. lie is dumb If he doesn't. H.M.JR: He said that I An making a great mistake to that you could take this fellow, you see--I try to push bretton Woods before reparations is settled, would kind of feed him. You don't have to feed him indus- because he said reporations should come first, and he trialization, and as I told Baruch, we could feed sixty wouldn't be completely frank with ne If he didn't tell DE, because be said the whole economic welfare of this country million people, see? Just start him on that. 1 mouldn't give him the works, but I would start him on that. So and England and everything depends on reparations, and that much for that. I am confused because the nan would talk has to come first, So, I told him that I didn't agree with about ten different things, and really wouldn't complete him. Be said, "Well, you are uron"." I said, "We are going any thought, and the only thought I really got out of it to let 11 go through the House." He said, "You see, that was that reparations is more important und everything else question is coine to come up in the House yery soon. has to wait. Do I leave you people confused? or course, he is putting It--and be sold, "You will see that." I sald, "well, you night suy, "why not let's sait MR. LUXFORD: Yes, sir. until the teriff question is mettled?" I said, "why not let's wait until something else is settled? If you wait until all these things are settled, you are not going to get anything.' While the man's mind wanders, he is one of the cleverest operators there is. He can get the trip 166 165 - 8 - - 7 send you another one." I said, "She can't, but come to MR. 00E: I wonder If we could-- dinner anyway." MR. DuBOIS: I don't quite understand the nature of Well, anyway, I have to keep in touch with him. He his trip. You say he is not going to Moscon? will send this fellow Lubell--is that his name? n.W.Jk: I don't either. He didn't know about the 15. 0'00NNELL: Sam Lubell. European Advisory Committee. All he is going to do is see Churchill. H.M.JR: he will send him over to see you. I am going to get that story in the Saturday avening Post. IG., LUXFORD: Can we make A horse trade with him? Tie will play along with reporations a little if he will MR. O'CONNELL: lie wrote the rubber report. lie has start batting around on Bretton woods. been workin- for baruch ever since. H.M.JR: He won't trade. lie told ne three times-- Mic. WE: lie wrote Baruch's report. he said, I wouldn't be frank with you if I didn't tell you that everything has to wait for reparations. You N.H.JR: And lot's Just see where we are, and don't can't budge him. you get the Moscow itch either. MR. COE: Mr. Secretary, if you break this thing down, MRS. KIOTA: lie has had It for nome time. I think you will find the group in general agreement on the importance of the reparations business, but it would VR. LUXFORD: have priorities been established on Moscon? look to ne from what you said that Daruch on his trip will hit the reparations thing through the British, and maybe indirectly will gun up anything that Lubin is trying to important that woscow's condition-- MR. DUBOIS: 1 tnink in all seriouaness it is swfully do or say have instructions to do. It would still seen to me that the main place where the reparations thing would H.M.JR: de will see, but let's see what Mr. Baruch be settled in the next period would be Moscow. is going to do. He said in just so many words that he isn't going to n° over unless he practically dominates the H.M.JK: but this to me makes as much sense 05 Rosenman's situation. Where that leaves Lubin, I don't know. trip does. VR. D.M. BELL: Is he going now? NR. DuBOIS: 1 was hoping that somebody, of course, thinking of myself anong others, could get to Moncou where B.K.JR: 1 think he is waiting for an invitation from the real nork will be done. Now, that's the place, and if Churchill, which he hasn't gotten yet, And of course, I be is trying to by-step that, there is going to be trouble. think If Stettinius--it's all crazy. He gets all your lines. He complains how badly the Government is organized, H.M.JK: Well, listen, this is a very powerful follow, and then all these things all mixed up--well, anymay, I and he just runs ciroles around Lubin, see, and he comes got this habbi Korif outside again, DuBois' chum, and I'll to ne and says he will send me e fish--you know, shad. send you to Korff. (Laughter) (Laughter) I never got 8. shad from him in all my life. He said, "I will--I'll send you one under one condition, Did you get hold of Spence? that your wife can make gefuhlte fish. If she can, I will Regraded Unclassified PRECISION TRADE MARK 168 167 9 - - 10 - MR. LUXPORD: It's all fixed up. IR. DuBOIS: Do I wait on Lubell? H.W.JR: 1 got this measure-- E.M.JR: You sit. Who is going to help no on this thing with Korff? MR. LUXFORD: He said one thing-- VIL DuBOIS: I wasn't suggesting myself. S.M.JR: I tried to get you and tried to pet Harry. R.M.M. You wouldn't be so good. MR. LUXFORD: The lend-lease thing is very hot. According to him, they are going to argue on the twenty billion we are Nk. DUBOIS: I think it is generally on var refugee. going to have for reconstruction on lend-lense--there is no reason for Bretton woods. That's got to be cleared up, but VSS. KLOT&: 1 thought it was Jabotinaky. That's I told him Crowley was coing to testify and san no reason what the letter said. any Crowley couldn't handle that. MR. DuBOIS: It did. He called ne this morning. MR. 008: They have accepted an amendment to the Act. 10. 0'00NNELL: Lend-lease? H.N.J.: That's all right. but 1f--this is what Rr. wolcott told me, that everything was going fine and that White was doing a good job. lie feit encouraged, but he said this was just 8 little irritating--this one-thirty business this afternoon-and if they could get that straightened out, he thought it would be helpful to Bretton woods, and if they net at one-thirty, none of the Republicans would come. VR. O'CONNELL: Jesse wasn't there for recess this morning, but there were four Republicans, none of whom made any objections to one-thirty. H.M.JR: Well, anyway, 1 thought I would call Jesse up. Yes, it's a nice thing, It's 8 nice gesture. MR. 0'00NNELL: Sure. VR. LUXFORD: That's right. H.M.JR: I just wanted to bring you fellows up to date. I'll have to excuse myself now. We will have staff tomorrow. Unless I see Stettinius, we will have a regular staff meeting tomorrow morning. Regraded Unclassified 169-A trand- 3/13/45 March 13, 1945 4:09 p.m. 169 THE SECRETARY of THE TREASURY WASHINGTON HMr: Henry telking. Bob Mannegan: Yes, str. HMJr: In there any reason why you should -- know why By dear Mr. President: Bartelt's? I shouldn't E° ahead with this appointment of Thank you for letting ne read the letter from H: No, sir. the Frime sinister to yourself concerning Article VII and cesirable International agreements in the HMJr: It's all right? trade field. (The cocuments are attnched for your H: file) No, sir, I called up Barnes within n. minute after I talked to you. I B.IS sorr, that it was not ossible for you to HMJr: Yeah. Yell, then : think we'll E° ahend with it. alsouss tale at your recent meeting, for this Le one of the najor economic fronte on which ne must H: Yeah. make progress in the next period. I ASI in thorough HMJr: agreement with the polats rade in the memorandum Thank you 80 much. tist there must be en international code of rules in H: the trade fielo, in proor to do any with the jungle Okay, sir. of trade restrictions, cartel ractices and restric- tive compodity agreements, all of which serve to re- ques trace não rovote International friction. The roblem la similar to that which de tackled in the Bretton Woods agreements in the mon-tary field, and that experience indicates that the United States con Let international agreement, If it rents to. I wonner weather this sould not be a good range of subjects to throw lato your Gabinet committee on Foreign Economic Policy. That committee, as you will remember, vill include Stettinius, Wellace, Taken one myself. I love been holding the order which you approved for the committee while you and Stettinium were out of the country. Faithfully yours, The President POLICTORY BUY The White House Enclosures COPY 169-C DEBANTOPOL. 169-B 11 Downline Street, whitehall THE WHITE HOUSE WASHINGTON 11 February, 1945. March 6, 1945. My tent Franklin: L. T have to thank you for you" letter nº Formuary 10 MEMORANDUM FOR about Article VII of the Lenne-Loud Agreement. T cabled THE SECRETARY OF STATE AND THE SECRETARY OF THE this home to the Cabinet and have 30% - la full realy from TREASURY: them. Tt. 1 that turias the nott are -eeke there TO READ AND RETURN FOR MY has been $ recular sentes of disgussions in London between PERSONAL FILE. is mous of birth Brittich officials not three American officials F.D.F. 1nd by Holder, visa of beat of the division in the State Deventment Atch deals with Commercial Policy and in not attached to the American Thought. You FAY ------ that that since in this form et the increasion of the State and - to informally, attlent of charge cornitting ofther Deveropment, there both countries stood - " moult of consideration state the talks 1n Washington mather core than A your seo. Althmuch Companital Polley THE the reta subject, the talks counted the whole --- 0° Anticle VII and segnet to our neonle to have let 11:45 into obscure corners. 2. 117. Revidas rent snok N. week ago to Vashington to mont and to due to return to London us the of next month to tell us the Pashington monation to the talks. Ve 169-D 2 COPY 169-E ON APTICLE VII sholl then be able to consider with all ameticable meet (Provered by Ambanandor Vinant with the assistance of 117. Revkins eat Kr. Penrone.) whether such differences B.IT may be Print in menuto between the United States and the United Kinsten ean be betreet not " no, 1) "he certod between the Fard Yes one of International trude compare. Each country, 3° misine carlers, Innomine cuota restrictions, negotiating chat should in lines or Pare constitution of profermantial vollition mastatative and discriminatory OT- change controls, and are substristas exports tried to take enze of iss ova 27 otter Datied Austons, 05 the excesse of those in other countries. To consequence international strude will in lurge not destroyed. Blace all countries " The "4" Cautant de not 10th to at are to varying decrease desendent unon is for their prosperity, all enffored. The international seconte policy or nutions became E struccle this state of the - to contine o delecition for G shrinklar world trade, had the very notictes whereby each moutht so nave throlf caused world trude to shutnk milli further. to Weshlugton. This must Involve other countries 2) The economic streagth of the Datted States to menter then that of any into the discussions, notably France, no nn early usage and other country. Its neoduction and commotion in D large nert of the production and consumation of the entire world. Tt 1g the restent of course the present read of the Doctors nume be amailtor ansion. The pollotes to number and advocates vill be declare in termination whather entual Invovertatment or nutual amountity -111 defore le go further on concral nolicy. charmaterize connomic polletes to the nontrar world. 4. Tn Has of the above, onl/ is not be se note 1) The concetunity so 46 accesside about this is but Pleating. Then the - in ore indust n trate -111 be till we have both have not been Date to value undusting in the United Wattons must be converted Page canting to seson- The spout of reconversion but 11 outs be - smagle statuke the made in the Informal 1 stall if - and other countries verely went back to what TIME but before the vant " nech emintry esta soucht to readuen what " t, consumer without morent be vary and to talk this over with you they - Foot. to the that that "t. wight COT. economically Invort FORM of its ments from other countries not thus Senefit Itnelf the count+ten Yours signature, titch " buys. The trute polictes which nations sulent tea the no 18 07/17 -111 columine to is 10mm eftegt the mitters of requesting which -111 develop chroschout the world ILT production for VIII -tves to 3/ a. CONTRAILL understing for Millon. Trasto and coatly an this - has been " has for the stre octor much that in code The fact that the in in a state of *lux dream us the oncertualty to create 9 new not better nattern. 305 11 in Ha consetunity which - -111 have only for " mintively relet sine. If things 07 allowed to ince, production not The President trade -111 tent to movemt to Ant they - not +111 late the of the United States of perfor. interes that Secretary Full on the recent Administration sought no out Count no difficult to change because of the resistance of vested internate. 41 de should seek 30° international on a code of -uler to covern stade relations. The code should outley birth teriffer smoking mota systems: rule out discriptantory trade remote qualidies sherety Governments throw their financial streath unbind their na retucers to erush the composition of those in other countries: private Interests through cartel ammarements from mustration thearforts of covernments to attrulate International trade. -1- 169-G 169-F the same time agreement should be sought on the to novern esciments for stabilizing the nonition of primary medicares the have suffered no seriously the the wide and eventle behavior of stante 7) If the President of the United States should take the lead in complity - and us the Bitte stree normit contemer Denty so be adventing will thought out policies not concrate proposals in the efficiently served. AR international trude organization should de field of interpational trade nolley, nublic oninion throughout the entablished to harmonize trude polteles of nations and to study the writ stat well fall 1a unhins him, soit alans for reconversion to technique otherwise smile inlictes one be made notabily heleful ruther respeting nicht in Insue require be nate in the 11/ht of this natually dostructive, and to complete and the normation the methololog and enunciated by him. of ------------------------- these enta in visa, "I "- have had expensive discussions on un exploratory not the officials na Misse curretion and am a 1- of that peeda to in done. Ther that N. solution of the of trute relations in essential: this the enteally destruction state of the not emented Printion at Ill-feeline A that 10 this consinues is the future, to 111 to much so deatiny the notate of consumption on tich success in overat tag it received vorte pass meet, 30% the of the problems amendated is also there mobiers have defent solution to the post. 4) The following state 170 anduested for (a) Conglete our discussions 1th the watting 1th P Mails mushing to detail on the metholder thes should - - internations trade the Has 0n 4th onstana Should acout ent the they should maire to there the Mad of mold small Mint shorts ne 10" 10 be Mister smilleation of these und the revention of MAIN - mate. (b) Messure by the to adventing the - the forezoine se the sollez the U.S. should and to internet, The not n° howing been meached - the Settish should not - Hotan although materation right be made to the fact that estendize explanatory Manuaatons -1th the end other congented Inflaster the this there in not programs of 140 Gerentute nº - - (a) The U.S. should then are to other n. of principles on commembial notten so 1877A - the For fa United Cattons conference the ate of tich would 20, (1) to docume reneral adoution on details not of importated nn communical volier: [11] to establish at once as International Trude - at least as Interie Trade Oppositation which - soon the milegat for 11. attacent organization: (111) to direct the Trade so smoniste them vehicles tato a detailed multilateral convention to which all United end associated Nations vould be Invised to othere. ⑉2⑉ PRECISION TRADE MABE MICROSTAT/ OH. MICROFILM SOLL NO. TREASURY DEPARTMENT 170 TREASURY DEPARTMENT 171 INTER OFFICE COMMUNICATION INTER OFFICE COMMUNICATION DATE March 13, 1945 DATE March 13, 1945 TO Secretary Morgenthau (for information) TO Secretary Morgenthau - /or Your Action FROM Mr. Coe FC FROM Mr. Coe FC Subject: Long-Lease Exports to Russia Subject: Exports from Occupied Jernany. The policy to be pursued concerning exports from Bermany during period of military operations 18 now under discussion. 1. In December, 1944, United States lend-lesse exporte to Russia totaled approximately $266 million as compared with The British have suggested an ad hoo comittee be about $800 million in November, 1944. established consisting of U.K., U.S., France, Belgium, Tuxembourg, and Mothorlands, under the chairmanship of SHARP. This comittee would be (iven instructions that 2. Among the principal non-military items were: (1) T.F. and v.s. have absolute priority, and (2) no action be taken "which might seriously affect the future structure Motor Trucks (all sizes) (625 million) of Terman economy. Steam Locomotives (018 million) war Department in saking for our concurrence on this Dried (810 million) position: Lard (16 million) Canned Heat (excluding chicken) (Sh million) (a) Hunnia should be represented on Committee which Canned Seusage (&5 million) alimuld be forned by the now Moscow Reparations Wool Cloth and uress Побов (84 million) Commission; (b) Until Committee 1a formed, exports should be 3. Among the munitions sent were: restricted to military needs and should be under the authority of SCARP; 2169 unermored scout care 1145 universal ordnance carriers (o) Border and neutral trade should be specifically approved by 0.0.8. 831 motorcycles 528 rellway freight cars Unless otherwise instructed by you, we shall conour with 274 medium tanks the SEP Department proposal. 183 P63 1-eng. pursuit fighters The Tritish proposal is interesting as a possible Indica- 79 ordnance combat venicles tion of future policy. It involves (1) non-inclusion of 50 825 2-eng. medium bowbers Soviet Union during the interim period, (2) granting to the 31 37om aircraft guns U.S. a virtual monopoly on Corman exports, (S) and at the same 30 047 2-eng. medium transports time, protecting German industry from the denanda of liberated 11 motor torpedo boats areas for machinery and equipment. 4. Shipments to Eastern Russia, presumably on Russian boats via Vladivostok or Bome other Siberian port, accounted for about 0105 million or the total or approximately $266 million exported during the month under review. m Cal ok seen paid tatall 311 4145 2018 m Coc Regraded Unclassified RECISION TRADE MARK MICROSTAT REG. W. 1. PAT. OFF. MICROFILM sou NO. 12" SEOREI REALI WAR DEPARTMENT GENERAL STAFF MEMO ROUTING SLIP Dear General Macready: 10 Mr. Hasper DATE 194 I have your letter of 5 burch 1945, emearning the problem of BUTLDING ATTENTION 1. (reasury Dept exports from Cermany, in.which you were good enough to copies of 1. 3439 4. a cable from London on this subject (NOD 019). The draft reply to SCAF 196 x 5. and SCAP 190, which who circulated " CCAC 182/2, has new been discussed by REMARKS the United States aide of the Conldned Civil affairs Committee In the 11:34 Haroed: damed appreciate of NOD 619. The following you may take as representing the views of the your Comments on this U.S. aide of the CCAC: at 3mr salied annumence 1. While the Vale members persolve no objection to the ostablish- sent of an ad hee comittee, as suggested in paragraph 4. of the Lendon cable, Mr. McCly is not anxim three questions arise in consection with the establishment of such . consittes to despital an appropriate & The conference at Talta agreed upon the establialment of a Reparations Commission, whose headquarters are to be in the poply as for Thanks- asposable D.S.S.R. It vas thought that the first order of business of the Complesion might well be the establishment of as ad hoo group, Email assons which presumbly would function within appropriate terms of refor- once prior to the full functioning of the parent Commission. The mrin GSC membership of eveh an ad 100 committee would undesbtedly be deter- SECRET mined by the parent committee, which of course includes the NAME OFFICE among its members. lense, . problem arises with respect to London's PHONE BUTCOTNG 71721 THE suggestion in paragraph 4 of NOD 019, which does not Include V.S.S.N. - anong the representatives on the proposed ad hee committee. The U.S. members of the Combined Givil affairs Comittee de not believe that an ad hee consittee of the sort NOD 610 proposes should be under the chairmanship of a representative of DIANP. In PRECISION TRADE MARK MICROSTAT KGG, PAT. OFF. MICROFILM ROLL NO. I 12" BEALI SCAP 190, SCARP suggests that the question of export of goods, other than those indicated in paragraph 1 of SCAF 195, should be handled by an intergovernental cossittee, wideh might well pro- vide a. small staff near SEASE's headquarters to advise him during the STATE pariod. It La our view that export problems of the type envisaged in paragraph 1 of UGAF 195 should be dealt with by SCALE as a natter of military nocessity. The advisory body, or all has coundates, would deal with export problems outaide the scope of questions arising under paragraph 1 of IDAF 195. 2- Im accordance with the views expressed in paragraph (b) above, the terms of reference for the ad has connittee proposed PLEASE RETURN THIS CABLE 20+ in NOD as would have to be revised, ainee in their present form MAJOR ERNEST A. caoss they assume that the commition's functions would include problems Civil Affairs Division, The Dept. Room 32 879 The Pantagon. enriss/ed by paragraph 1 of SCAP 196. 1. with respect to the question or exports to neutrals, the United states view La that any such exports, oven in the course of border trade, should require previous specific approval from the Combined C:1efs of staff. 2xt. 71721 à- It 1a our view that the reply to SCAP 195 and SCAP 199 should be essaled so NO to make SCASP current concerning the decision taken at Talta looking toward the estal lignest of a Deparations Commission. The lited states of the Couldred civil Affairs Committee will of course be (lat to disnues the foregoing problems at as informal meeting with you at your conveniatos. sincerely yours, JOIGE de MaCLOT overwier/ of Tar PRAZI PRECISION TRADE MARK MICROSTAT No. U.S. PAT. OH. MICROFILM sou NO. 2" profer not to mako any public announcement of our intention COPY NO. to take reprisals; we would moroly justify our action thus From: War Cabinet Office if the Germans complained. To: Joint Staff Mission 3. So far as requisitioning is concerned SHAEF 1s the Dated: 2nd March, 1945. only body with the necessary authority to carry this out. We O.T.P. agree, however that it will be necessary to establish some mechanism to co-ordinate the alcied domands for essential SECRET NOD 619 materials from Germany and to advise SHAEF on the principles Reference DON 527 of 3rd February, Control of to be adopted in determin' el cations. Probubly an intor- Exports from Germany. governmental body will eventually be set up, as part of the Similar representations have been received from the machinery for allocating reparation goods from Germany, or French Government through the diplomatic channel. Questions otherwise, but this will not be settled at least until after raised in SCAF 195 and 199 have been discussed on official the forthcoming discussions in Moscow. Meanwhile we consider level and our preliminary views are set out below. Please that action must be taken to deal with the immediate problem, discuss thom on the samo lovol with the Americans and report which is of much smaller dimensions, and that this can be done their reactions. No shall then seek the views of Ministers. without prejudice to reparation issues. 4. Although difficulties of transport etc. seem likely 2. Before the surrendor of Germany the allied forces on German territory will, from the legal standpoint, only in the initial stage at any rate to limit to comparatively have the rights of an occupying power and this noans that, small amounts the quantity of goods which could be supplied apart from requisitions effected by the occupying forces in this way, we recognize that SHAEF may well require guidance themselves, the right to soizo and remove Gorman stocks from allied civilian authorities on priority among possible would be confined to such cases as could be brought within recipients. We think, therefore, that at the outset the most the torms of Articlo 53 of the final act of the Second Peace practical arrangement would be forthwith to establish near Conference hold at the Hague in 1907. (See Manual of SHAEF an ad hoo committee consisting of representatives of Military Law page 384.) From a legal point of view there- the governments of the United Kingdon, United States of fore the position is not going to be very clear-cut. Some America, France, Belgiun, Luxembourg and the Netherlands of the things which the French want to do could almost under the chairmanship of a representative of SHAEF. Its certainly be justified, even on a strict interpretation of functions would be: Article 53; others would be bordor-line cases, and only the (a) To advise SHAEF of the nature and quantities learly outside the powers of an occupant th: various governments' requirements; will the Land Regulations. As regards the last class, (b) Where more than one government represented has MO Think it on grounds of practical necessity to laid claims to recommend having regard to Descriport comply with French request. If NO do so tro have - clear and other relevant fectory, allocations goods CT 10 the ground of reprisals. Mo Vonid however which SCAEF he code nake available from Cormany, Regraded Unclassified RECISION TRADE MARK MICROSTAT NG. U.S. PAT. OFF. MICROFILM ROLL NO. 2" 5. The representatives of His Majosty's Government and (c) In so far as transport equipment and coal are the United States Government on the committee would be enabled concerned to recognise that its allocation for to put in bids for what might be available but their position use should ultimately fall within the competence should be recognized as differing from tast of other governments of the proposed E.C.I.T.C., and E.C.O. respec- represented there in the following respects: tively when set up. (a) Should supplies become available which were of high 8, Account would equally be taken or any goods moved and essential value to the war offort of the British from the countries concerned into Germany under the authority Commonwealth or of the United States of America their of SHAEF. requirements would enjoy first priority. It should prove 9. SCAEF for his part, would keep quantitative records possible for the representatives of the United Kingdom of goods delivered and obtain through the intermediary of the Government to keep in touch through the existing supply committee receipts from the governments or their agencies for machinery with the Dominion Governments. such deliveries. All allocations and deliveries would be re- (b) It will be the special responsibility of the United ported to the appropriate four-party committee and where Kingdom and United States representatives to dissuade necessary to the combined boards who would thus be enabled the committee from sponsoring action likely to projudice to effect any necessary adjustment in overseas import issues of policy, 0.8. over reparations. programmes. 6. SCAEF should retain the ultimate power of decision 10. It is not considered necessary at this stage to whother any exports from Germany should be permitted for such make general provision for the export, apart from limited purposes and in excrcising his discretion would boar in mind the border trade as authorised, of any German surpluses to neutral necessity of taking no action which might scriously affect the countries with the possible exception of coal. If circumstances future structury of Gurman economy without prior reference to nake it necessary, however, specific requirements of neutral C.C.S. Similarly no export would be permitted of any largo countries would have to be considered on an ad hoe basis. In surplus which night become ovailable without prior reforence to the event of any coal being available the London Coal Committee C.C.S. Such major questions would fall for solution between pending the setting up of E.C.O. would be notified and if they the two governments in the light of policios then prevailing. decide that coal should be made available to a European neutral 7. Before being permitted to take delivery of any goods the question of payment would have to be cleared with the the government concerned would be required to accept the appropriate authority before the transaction was closed. following conditions: - 11, The arrangements proposed in this telegram would be (a) to be responsible for accounting for then in due course recognised as being purely temporary and without prejudice to (b) In PO for as the goods night be subject to a -lain to future arrangements. They would require reconsideration in restitution to accept accountability for then to the the event of any large enemy industrial area being uncovered restitution commission (See S.A.C. papers (4) 23 and since the disposel of any surpluses on this scale would ratse (45) 5.) major questions of reparation and supply policy. Regraded Unclassified RECISION TRAIN MARK MICROSTAT MICROFILM sou OR . 12. With regard to the subject matter of SCAF 199, any long-term arrangements would have to be made in the light of the proposal to establish a restitution counission. For the present we would be content with the ad hoo procedure ex- plained in the tologram under reference, 2.0.0, 021915Z DON DISTRIBUTION 1 Regraded Unclass BOLL NO. TRADE MARK MICROSTAT/ use. 12 u. 5. PAT. OFF. MICROFILM \ 181 25 MAR 13 1945 lear Mr. MeCloy: This is in reply to your letter of March 5, 1945 enclosing & revised druft of the Financial Directive Appendix 17 of JCS 1007, dated February 12, 1945. This revised draft reets with the approval of the Treasury Department. = Sincerely yours, (Signed) H. Morgenthau, Jr. life John J. Nothey, Assistant Secretary of Mr. 200.1m, 3/7/45 TOP SECRET Cac WAR DEPARTMENT OFFICE OF THE ASSISTANT SECRETARY di di WASHINGTON, 5 March 1945 The Monorable The Secretary of the Treasury Dear Mr. Secretary: : refer to your letter of 7 February 1945 inclosing a copy of draft revision, dated 31 Jenuary 1945, of Tinan- cial Directive, Appendix " of JCS 1067, which you state meete with the approval of the Treasury Department. Since the receipt of your letter. certain changes in the above-nentioned draft directive have been eng- gested. These changes have been cleared informally with members of your Department's Division of Honetary Re- search, and are incorporated in draft, dated 12 February 1945, attached hereto. Your approval of this later draft, or your comments thereon, vill be appreciated. Sincerely yours, July JOHN J. MoCLOY Assistant Secretary of War Atnt as above TOP SECRET PRECISION TRADE MARK MICROSTAT NO. PAT, OH, MICROFILM NOLL 9 2" TOP SEGRET 12 February 1945 TRAFT AFTICE "A" so "A" TOP SECRET c. to prohibit, or to proscribe regilations regrding, transfer or APPENDIX age other dealings in private or public accurities or real setate or other property. 4. To close backs, but only for A period long enough for you to in- 1, You will regulate and control currency streulation vitain your cone in accordance with the following provisions, não subject to N/ agreed policies troduce satisfectory control, to INDOYS Nest nné other undesirable personnel, And to Lease instructions for the determination of occounts to be blocked under of the Control Council. 4d below. B.- United States forces and other Allied forces vithin your come vill e. To close stock exchanges, insurance companies, and sizilar flam- use Allied Hilltary norks med. Reichenark currency on coins in their possession. cirl institutions for euch periods as you dees appropriate. Allied Hilltary marks and Reichment ourrency and coin now in circulation in f. % establish a general or limited corntorium or moretoria only to Gerunny will be legal tender without distinction end will be interchangesble at the extent clearly necessary to cerry out the objectives of Allied Military the rate of 1 Allied Hilitary asrk for 1 Michemark. Rele Government. end other Gerunn militory corrency will not be legal tender in Germange 3. Subject to any agreed policios of the Control Council, you will talse b. You will receive separate instructions relative to the currency financial zessurés with n. view to preventing or restraining so for as Is prac- which you vill use in the event chet for and require supplies of Allied ticable soch disturbances or developments in the monetary and financial field Hillitary marks not Reichmenrke not svailable. 0. You vill 501 assounce or establish in your cone. will receipt of as is your julgment threate) to disrupt the production or distribution of critically needed supplies. You should regard as critically needed supplies further instructions, any general rate of exchange between the Reichmer's on one those essential to forestall or alleviate disease and disorder such as might hand and the U.S. dollar end. other currencies on the other. However, a rate of endanger the forces of occupation or hamper the accomplishment of their mission. exchange to be used exclusively for pay of troops and militery accounting pur- Except for the purposes specified above, prom shall be guided throughout by the poses in your some will be communicated separately to you. general rule that no steps shall be teles by preva (a) looking townrd the financial 2. Subject to any agreed policies of the Control Commeil, you IT withor- rehnbilitation of Germany, nor (b) designed to eaintain or strengthen German ised to take the following stops and to pet into effect such further financial finances. moneures no you my dom necessary to recomplish the purposes of your occupation. 4. Bubject to any agreed policies of the Control Council a. To permit or require the the Bestenbank or nage other bank or agency to 10000 bank notes and currency which vill be legal tender; vithe. a. You vill prohibit the payment of military pensions or other enolu- cente, but this vill not preclude the payment by the German authorities of out each authorization no governmental or private bank or agency vill be per- compensation at the rate of billtary pensions therefor for physical disability mitted to issue bank notes or currency. required in the military service, limiting the recipient's ability to vork. % To require the German authorities to malge available Beichaunrk our- b. You vill prohibit the payment of pensions or other encluments by rency or bank credits free of cost and in amounts sufficient to seet all the reason of membership in or services to the former Hast party or its affiliated expenses of the forone of secupation, the cost of Allied Hilitary organizations. Government. TOP SEGRET TOP SECRET Regraded Unclassified PRECISION TRADE MARK MICROSTAT REG. 5. PAIL OFF. MICROFILM BOLL NO. 12" TOP SEDRET TOP SEO for the linet 16 Artive 110 Interests or to class a. You vill take such action as Decessary to insure that all its notivities. Lews and practices relating to trantion or ONE fields of finance, which dis- (z) Persons placed were letentive NE other types of custody criminate for or egainst entry persons because of race, color, creed or political to you, 10% =21 stier persons for allitary nevers- opinion, vill be mended, suspended, or abrogated to the extent necessary to next to Ln Strip 14 at invist me eliminate much discrimination. The Gemann authorities will be held responsible (c) Property with her in o of more, wronghal etc for taking such measures in the field of tenation and other fields of public of confiscation, disposition or mollintion, whether finance as vill further the accomplishment of the objectives of Affied Military to legislation or by procedure purporting to follow form Government. of Lew or otherwise: du You vill impound or block all mit, silver, currencies, securities) (5) Vorice or art 02 extrand actericl ná wine or importance, 20- accounts in financial institutions, credits, volumble papers, nod all other cardless of the Corref. nonets failing within the following entegoriesi You will take ench action no vill that any Emmaded or Videled cosets (1) Property ovned or controlled directly or indirectly, in whole vill be cealt with only De permitted must licenses or other instructions which or in part, for any of the followings you may In the 00.00 particularly of proportr under (:) (a) (a) the Geruse Reich, or any of the lender, Gaue or provinces, above, you will proceed to adopt Licensing which vidle mooh any Erois, Municipality or other stailar local subdivision; property under surveillance would permit 199 tree in visa the objoctives or NOT agency or instrumentality of any of them including of the competion. all utilities, undertakings, public corporations oz monop- 5. Subject to my agreed policies of the Control Council, men vill prohibit, olies under the control of may of the above; except as you may permit for regulation or license, all conlings in poll, silver, (b) Governments, antionals or résidente of other nations, foreign exclance. refl all formign financial and tride transpotions 12 including those of territories occupied by them, " vie eng kind. Tou vini not, however, until receipt of further instructions, enthor- vith nay of the United Nations at any time since 1 1se say outling of foreign exchange namete toon upons, including these from neutral countries, and vill not authorize payment in Decumar's foreign September 1937; (c) The Mari Party, mll offices, departments, agencies and exchange for any other purposes, except where clearly and offectly needed to further the agreed objectives of the Allied Hilltory Government. In imposing organisations forming part of it, attached to, or con- the controls herein described trolled by 10; its officials, leading members and 112- c. You will reênce to the possession nac control of custodians or porters; (a) All organisations, clabe or other associations prohibited agencies designated by you all German foreign excluinge proofs of every kind end or dissolved for allitary government; description: 3. You VIII autoblish offective controls with remeet to all foreign (e) Absentee ovners, cluims United Nations and neutral exclanate transactions, installes governments nationalar (1) Transactions as to property between persons instite (f) Ang institution Stanted to public worship, charity, not persons outside Germany: education or the and sciences which bas been used TOP SECRET TOP SECRET 3 Regraded Unclassified PRECISION TRADE MARK MICROSTAT NO. 5. PAT. OFF. MICROFILM ROLL NO 12" Tor (2) Transmations lovelving ablie tions over ter or to because the from my jerson in Generage to - person misside Germany: and (s) Cransactions Involving the importation 1.20 or exportation from of pay foreign exchange neset or other form of projects. 6. It is not multicipated that you vill surdent credite available to the Retebabank or are other bank, or to 127 public or private institution. If in your optation such cetten countries, 200 077 trich - nation na you wy deen proper and in PRO event you vill report the Costs to the Control Douncil. 7. In midition to the revisions of Article Ba. of Appeale 4, you will eliminate other undectrable perms =1 and influences from the Brich Ministry of Vinance and free /11 public and private financial institutions, neencies and organizations. a. You vill nristain mah Accounts and records as be pecessary to reflect the financial operations of the military government in your none raid you vill provide the Control Council vith much information as it may require, including information in connection with the view of currency lyp your forces, 127 governmental cettlements, occupation costs, the other expeditures cricing out of operations or activities involving participation of your forces, TOP SECRET 5 195 The Rew Bork Cimes Times #quare ARTRUR HAYE - - March 13, 1945 Dear Benry: I am sorry that your plans took you away from Washington and that I was unable to have a chat with you. = Here's hoping for better luck next time 1 Yours, aircum Honorable Henry Morgenthau, Jr. Secretary of the Transury Washington, D.C. L PRECISION TRADE MARK MICROSTAT/ PAT. OFF, MICROFILM ROLL NO. TREASURY DEPARTMENT / 189 INTER OFFICE COMMUNICATION DATE MAR 13 1945 TO Secretary Korgentheu FROM Mr. Hurt K Dubject: Outber Situation No Lave Leen keeping in touch with Mr. Fox at 03 regarding changes in the munitions production schedules both with and without the defect of Germany. The situs- tion continues cloudy, incenuch DE the Any La in the process of reviewing its plans. Tentative schedules assustry Germany stays In the var throughout the rest of this year have been worked out and indicate that the dollar value of production will - vilgat increase over the next several sonths. The plane for carrying DA a one-front var after the Geruan defeat are still being worked on by the army. 4 $ review of the latest plane 1s now being conducted as General Sonervell's 1-vel with the belo of E three-man board, according to Hr. Fox, but there is no indication as to when the data will be provided to VPB. Xr. Fox said It wes Lie guess that It would be at leant another week or ten days before even preliminary figures vould be received. At present de thinks that the general outlock is about the value 0,0 be and Mr. Xrug reported to us = few veoke Ago, namely, that outbacks after the German defent vill be 010M and not very sharp, and in the LABY vill not ocus anyWhere near the 40 percent level which was talked about last fall. RECISION TRADE MARK MICROSTAT/ NO. U. s. PAT. OFF. MICROFILM ROLL NO. 190 191 Prices of for Filver in Beaber Market MAR 13 1945 (In Valle dollars per ounce) late the last 1963 Dear Senator (cCarrent January .82 .80 It's Crowley, Administrator of Foreign Zeonomie February .86 .01 March Administration, has forwarded to ne a engy of your .90 .06 letter regarding the use to which lend-lease silver April 1.04 .88 1a put by the Government of India. Mr. Crowley -6" 6- May 1,09 .97 June 1.02 gested that the Treasury Department may have inform- .98 tion which would be of interest to you. July .97 .82 I believe that you may find of interest the August .90 .86 attached table giving prices of silver in the Bombey September .98 -93 October market during 1943, 1944 and the latest rigures avoil- 1.02 .99 November .99 .97 able for 1945. December .98 .92 It will be noted that the price of silver 11d 1944 not dealine appreciably after August, 1944, the month in which the Reserve lienk of India began to soll silver. The rice of silver me continued to be spound $1.00 January .94 February 1.02 .98 per cance of about the sime level as revailed during Hereb 1.11 1,00 1943. This Le in accord with the assurances which we April 1.14 1,06 received from the lovernment of India that silver my 1.12 1,06 would be sold for stabilization purposes and not to June 1.06 1.01 break the rice of silver in India. July 1.11 1,06 Sincerely yours, August 1.06 1.05 September 1,06 .97 (Signed) H. Morgenthaw, Jr. Detober .99 -97 lievember .99 .91 Desember 1,06 .97 1945 Songrable 201 January 1,05 .97 February 1.02 .98 United States Senate. ISF/efe 3/8/45 Regraded Unclassified 2" wh C FOREIGN ECONOMIC ADMINISTRATION o OFFICE OF THE ADMINISTRATOR FOREIGN ECONOMIC ADMINISTRATION OFFICE OF THE ADMINISTRATOR Y WASHINGTON 25, D. C. March 3, 1945 Dear Benator McCarran: MAR 3 - 1945 I have the following Information for you with respect to the questions raised In your letter of January 19, 1945 regarding the lend-leastng of silver to the Government of India. Descr Mr. Secretary: The requisition for 20 aillion outces of ollver for coinage for India referred to in RV letter of January 1, 1945 brings to 4. I an enclosing a cost of & letter which I total of 40 million ounces the quantity of silver approved for trans- for under land-lease to the Government of India for essential coinage received from Senntor McCorran regarding the use purposes only. The earlier 20 million ounce transaction together with the agreement by the Government of India perteining to the return to which lond-lease silver La put by the Covern- of the silver TO . brought to your attention at the time in accordance with our castos of keeping you advised of all lond-lease silver trans- ment of India. actions. I believe that the Treasury Department any In addition, hosever, you will recall that 100 million cunces of silver were lens-leased to the Government of India for coinage purposes have information with respect to the market price and for the purpose of stabilizing prices in India in the interest of this country and India In the joint vir effort. Secretary Morgenthau of silver in INdia and other information which any abo Secretary Stettinius, who was then the Land-Lesse Administrator, discussed this transaction In advance with the Senate Special Silver Com- be of interest to Sennter McCarran. nittee and explained that the silver would be used by India to stabilise the price of gilver in order to help prevent inflationary prices in India which would Interfore with the prosecution of the war in that important Sincerely yours, have of allied allitary operations. They explained further that the silver would be returned to the United States Treasury after the end of the war and would not be damped on the silver market no na to depress the price of silver. A 00 gy of the agreement lated June 8, 1944 between the United States and India with respect to this silver transpotion ⑉ gent Leo T. Crowley to you. Administrator The 100 million ounces of gilver transferred to the Government of India pursuant to the agreement of June 8, 1944, was therefore not in- tended for escential coinage purposes alone, but was also intended for The Honorable use for atabilization purposes. The Secretary of Treasury Washington, D. c. I have taken the liberty of sending a copy of your letter of January 19 to Secretary Morgenthau in order that he may provide you with any further information availab'e to the Treasury Department on this sub- ject witch may be of Interest to you. Enclopures Sincerely yours, (signed) Leo T. Crosley Monorable Pat McCarran Administrator United States Senate Techington, D.C. Regraded Uncla PRECISION TRADE MARK MICROSTAT No. U.S. PAT. OFF. MICROFILM BOLL NO March 8, 1945. Dear Julie atternou Dear Mr. Secretary: I enclase a ear of . letter I haw received Crum in Ce bis I - afrid I have to invoice your aid in a matter arising ous of beed of the adsed Bagine Treasury Delegation Ln portaine the Stage II negotiations when Lard Keynes was here, and out of certain Inc to the quastion of take-oute of marital (actlities action then taken by the American members of the Combined Committee, which DAS last - centing - of which you were Chairesan, 104 will recall that on January 4, 1343, : you a letter with I refer to the claim which was contained in paragraph 10 (11) of enclosiones atting forth the l'ast that Na hai, durta: the Tage Chapter III of the V. K. statement of Requirements for Stage II, in res- II discussion, premoted a Canial data for 034 willing representang pect of what 1s known as the balance of the *take outs* of capital Umtr notivate of the restating values of familities which - had across facilities. This claim, the amount of which was tentatively put at 14 over, and repartis that you LarentLoste the present status of #38 million, was in respect of item listed in your letter of the 28th the proposal transmitions Mish a to completing then - originally September 1962 to ar Frederick Phillips, in respect of which no payment contacilated," I painted out the customs of our commitment Ln this natter, had below sade by the U. S. Government, which was Clast dven our - years age and was reiterated Informally curtag the Stage u discussion, and stated that 2 - andao that this During the Stage II discussions we wore informed that this claim conditions be fulfilled. vas accepted in principle, subject to a review of the arrangemente pre- viously made, a valuation of the facilities, and due availability of 1 - exam of the fait, stated in par letter at January 25, that funds - see paragraph 2 of the Agreed Minutes of the 7th Meeting of the the critten had in addred word a year A, to vum United facilities Contrined Committee held on the 17th November, 1944, and Item 3 (e) of over to - as redumed aid and User. they had replicat Use they (Per Annex PG* to those ninutes. forms to leave the question In shipmon. the Transury had naão the same proposal and requived Man --- I had asravel, - understand that in pursuance of the decision taken during the Vat by their notion In presenting Ve clats at the time of the rooms Lend-Lease they That Lattested the to voter- Stage II discussions you sent a latter to the "ar Department, on behalf sain the netiprosal auf proposal. of the American nombers of the Combined Committee, saking for the War Department to implement the decision by saicing payment to the U. K. Government of the aus found to be due under this clain. Since then we be - Inamed that 200 throght 11 instructive to nake arringmenta fur cash settlement until the british femally refased so the have had no further information, I believe, however, that the War facilities - rediprocal add, - Classast the question with Man and Department have now intimated that they are unable to proceed with a supported position. that they indistain to equip you wish a of Undr settlement unless they can have, for the purposes of the record, a statement from us indicating that the U. X. Government is not prepared to make the facilities available to the U. 5. Government on the basis The enclosed letter from - trant Le Untr statement, I being Uws of Reciprocal 41d. The suggestion that Reciprocal Aid should be granted you will use Bal 15 smithle to with date or arresgements are was put forward in a letter dated 6th December, 1943, addressed by Mr. nationary to affect the early completion of Unter Patterson to Sir Walter Venning, the Director General of the British Ministry of Supply Mission. In a letter of the 1st February, 1944, to Mr. Patterson, Sir Walter Venning stated that the U.S. Government had yours, reached the conclusion that the nethod of mettlement in regard to the balance of these facilities should be left over for future consideration as they did not feel justified in agreeing to the proposal that they Resurable Roberts - rulterson, should be sade available on the basis of Rediprocal Aid. nar 4f W. in its Stage II Case, that having regard to the difficulties of the U.K. An I have indicated above, the U. K. Government put forward a proposal, dollar position, the 0.3. Government should now implement the arrange- sents contemplated in 1942 by taking over the balance of the facilities against & dollar payment. That proposal vas accepted in principle but respection -3/13/45 availe implementation. It follows that the U. K. Government have in fact Regraded Unclassified PRECISION TRADE MARK MICROSTAT No. V. 5. PAT. OFF. MICROFILM ROLL NO. - 2 - MAR 18 1945 by this action already confirmed that they do not 000 their way to make the facilities in question available to the U. 8. Government on the basis of Reciprocal Aid. May I suggest therefore that you should send & copy of this letter to Mr. Patterson in order that he may have on record the statement by the U. K. Government which he aska for. I also trust that when this has Dear Mr. trands been done it will than be possible for the war Department to implement the decision taken by the main Morganthau Consittee: The British Ministry of Thank you for your latter of Harch s, 1945 setting Supply idesion renains of course ready to discuss my details which say forth your position on the long-pending question of the still require clarification. I should be grateful for any assistance take-oute of capital facilities. As you requested, I which you, as Chairman of the Combined Committee, can give in securing have sent to the Under Secretary of Mar, Robert P. an early settlement of this matter, to which my Government attach con- Patterson, & 0000 of your letter and expressed the hope that its contente will enable him to make whatever an siderable importance. rangements are necessary to effoct the early completion Yours sincerely, of these transactions. Unclosed for your information is a copy of ay letter to Under acretary Patterson, transmitting to him & copy Be H. grand. of your letter to no. Sincerely yours, The lienry Horgenthas, JT., Secretary of the Treasury, (Signed) H. Morgenthau, Jr. Washington, D. C. Kr. R. N. insul, United Kingdom Treasury Delegation, Pa D. Box 680, Mashington, D. C. Enclosure. DWCaDr1 -3/10/45 Unclassified MICROFILM BOLL NO I 2" have - contancapy - UNITED KINGDOM TREASURY DELEGATION Et Cot BOX 680 3/9/45 BENJAMIN FRANKLIN STATION Mr. Secretary -2- March 8, 1945. WASHINGTON, D.S. REFERENCE March 8, 1945. TELEPHONE Executive .... swaits implementation. It follows that the U.K. Government have in Dear Mr. Secretary: fact by this action already confirmed that they do not ... their way to the facilities in question available to the U.S. Government on the basis of Reciprocal Aid. I - afraid I have to invoke your aid in a matter arising out of the Stage 11 negotiations when Lord Keynes was here, and out of May I suggest therefore that you should send a copy of this letter to Mr. Patterson in order that he say have on record the statement certain action then taken by the American members of the Combined Comittee, of which you were Chairman. by the U.K. Government which he aska for. I also trust that when this has been done it will then be possible for the War Department to implement the decision taken by the main Morgenthau Committee: The British Ministry of I refer to the claim which was contained in paragraph 10(11) of Chapter 111 of the U.K. Statement of Requirements for Stage 11, in respect Supply Mission remains of course ready to discuss any details which may of what is known as the balance of the *take outs* of capital facilities. still require clarification. I should be grateful for any assistance This claim, the amount of which was tentatively put at 838 million, VAS in which you, as Chairman of the Combined Committee, can give in securing an early settlement of this matter, to which my Government attach con- respect of items listed in your letter of the 20th September 1942 to Sir Frederick Phillips, in respect of which no payment had been made by siderable importance. the U.S. Government. Yours sincerely, During the Stage 11 discussions TO were informed that this claim was accepted in principle, subject to a review of the arrangements previously made, & valuation of the facilities, and due availability of K.H. Brand. funda - see paragraph 2 of the Agreed Minutes of the 7th Meeting of the Combined Committee held on the 17th November, 1944, and item 3(e) of Annex "C" to those minutes. No understand that in pursuance of the decision taken during the The Honourable Henry Morgenthau, Jr., Stage 11 discussions you sent & letter to the War Department, on behalf of the American members of the Combined Committee, asking for the War Department Secretary of the Treasury, Washington, D.C. to implement the decision by saking payment to the U.K. Government of the FUR found to be due under this claim. Since then " have had Do further information. I believe, however, that the Var Department have nos intisated that they are unable to proceed with a settlement unless they can have, for the purposes of the record, & statement from us indicating that the U.K. Government is not prepared to make the facilities available to the U.S. Government on the basis of Reciprosal Aid. The suggestion that Recipirical A14 should be granted was put forward in a letter dated 6th December, 1943, addressed by Mr. Patterson to Sir Walter Venning, the Director General of the British Ministry of Supply Mission. In a letter of the 1st February, 1944, to Mr. Patterson, Sir Walter Venning stated that the V.E. Government had reached the conclusion that the method of settlement in regard to the balance of these facilities should be left over for future consideration as they did not feel justified in agreeing to the proposal that they should be made available on the basis of Reciprocal 414. Am I have indicated above, the U.K. Government pas forward a proposal, in its Stage 11 Case, that having regard to the difficulties of the U.K. dollar position, the U.S. Government should DOB Implement the arrangemente contemplated in 1962 by taking over the balance of the facilities against & dollar payment. That proposal vas accepted in principle best emite/ PRECISION TRADE MARK MICROSTAT/ REG. PAT. OFF. MICROFILM ROLL NO. 12" 197 MAR 13 1945 Dear 27. Claytons Thank you for sending - copies of the documents comprising the Lend-Lease igrooment with the Provisional Government of the French Republic. then the printed documents are ready, - would like ten copies for our use, if that is convenient. Sincerely yours, Signed H. Murgenthew, J. Monorable Villiam L Clayton, Assistant secretary of state, lashington, D.C. FCarl 3/13/45 Regraded Unclassified PRECISION TRACE MARK MICROSTAT REG. OFF. MICROFILM BOLL NO 2" PRINCIPLES APPLYING TO MUTUAL AID IN THE PROSECUTION OF THE VAR AGAINST AGGRESSION mark Preliminary Agreement between the United States of America end the Provisional DEPARTMENT OF STATE Government of the French Republic. WASHINGTON hereas the Government of the United States of America and the Provisional Government of the French Republic declare that Varch 10. 1945 they are engaged in a cooperative undertsking, together with every other nation or people of like sind, to the end of laying My dear Mr. Secretary: the bases of a just and enduring world peace securing order Enclosed are copies of the documents com- under law to themselves and all nations; prising the Lend-Lease Agreement signed with the Provisional Government of the French Republic And wheress the Government of the United States of America on February 28, 1945. As soon as the formal documents have been printed we shall be glad to and the Provisional Government of the French Republic, as sig- provide such additional copies as you may require. natories of the Declaration by United Nations of January 1, Sincerely yours, For the Acting Secretary of State: 1942, have subscribed to a common program of purposes and prin- 11.4 Clayton ciples embodied in the Joint Declaration, known as the Atlantic Charter, made on August 14, 1941, by the President of the United States of America and the Prime Minister of the United Kingdom Assistant Secretary Enclosures: of Great Britain and Northern Ireland; Master Lend-Lease Agreement between the United States and Provisional Government And whereas the President of the United States of America of France Agreement between the United States and Provisional Government of France has determined, pursuant to the Act of Congress of March 11, Reciprocal Recipro A1d Acceptance by Department of State A1d Offer from the French Government 1941, that the defense of any French territory not under the con- Memor from Department of State to French trol of the Axis 18 vital to the defense of the United States of Government Copy of ter dated February 28, 1945 from Copy Mr. of ter dated February 28, 1945 to Monset t to Mr. Grew with attached statement America: Copy Mr. of letter dated February 28, 1945 from from Mr. Grew And whereas the United States of America has extended and Mr. Monnet to Mr. Grew regarding troop pay is continuing to extend to the Provisional Government of the Copy of or dated February 28, 1945 to Mr. Monnet from Mr. Grew regarding troop pay. French Republic aid in resisting aggression: And whereas it is expedient that the final determination of The Honorable LYICTORY Henry Morg thau, Jr., BUY Seori ry of the Treasury. the-terms and conditions upon which the Provisional Government of the French Republic receives such aid and of the benefits to be received by the United States of America in return therefor Regraded Unclassified RECISION TRADE MARE MICROSTAT 116 PAT. OFF. MICROFILM BOLL NO 2" articles, services, facilities or information as it may be In's should be deferred until the extent of the defense aid is known position to supply. and until the progress of avents makes clearer the final terms Article III and conditions and benefits which will be in the outual inter- The Provisional Government of the French Republic will not este of the United States of America and France and will promote without the consent of the President of the United States of the establishment and aintenance of world peace; America transfer title to, or possession of, any defense article And whereas the Government of the United States of America or defense information transferred to it under the Act of and the Provisional Government of the French Republic are sutu- March 11, 1941 of the Congress of the United States of America ally desirous of concluding now a prelisinary agreement in or permit the use thereof by anyone not an officer, employee, regard to the provisions of defense aid and in regard to certain or agent of the Provisional Government of the French Republic. considerations which shall be taken into account in determining Article IV such terms and sonditions and the making of such an agreement If, as a result of the transfer to the Provisional Govern- has been in all respects duly authorized, and all acts, condi- ment of the French Republic of any defense article or defense tions and formalities which it any have been necessary to perform, information, it becomes necessary for that Government to take fulfill or execute prior to the saking of such an agreement in any action or make any payment in order fully to protect any of conformity with the laws either of the United States of America the rights of a citizen of the United States of America who has 07 of France have been performed, fulfilled or executed as patent rights in and to any such defense article or information, required; the Provisional Government of the French Republic will take such The undersigned, being duly authorized by their respective action or make such payment when requested to do no by the Governments for that purpose, have agreed as follows: President of the United States of America. Article I Article Y The Government of the United States of America will con- The Provisional Government of the French Republic will tinue to supply The Provisional Government of the French return to the United States of America at the end of the present Republic with such dafense articles, defense services, and emergency, as determined by the President of the United States of defense information as the President of the United States of America, such defense articles transferred under this Agreement America shall authorise to be transferred or provided. as shall not have been destroyed, lost or consumed and as shall Article II be determined by the President to be useful in the defense of The Provisional Government of the French Republic will con- the United States of America or of the Western Humisphere or to tinue to contribute to the defense of the United States of be otherwise of use to the United States of America. America and the strengthening thereof and will provide such Regraded Unclassified RECISION TRADE MARX MICROSTAT us PAT. OH. MICROFILM BOLL NO 2" At an early convenient date, conversations shall be begun Article VI between the two Governments with a view to determining. in the In the final determination of the benefits to be provided light of governing economic conditions, the best sesne of attain- to the United States of America by the Provisional Government. of ing the above-stated objectives by their own agreed action and the French Republic full cognitance shall be taken of all prop- of seeking the agreed motion of other likeminded Governments. erty, services, information, facilities, or other benefits or Article VIII considerations provided by the Provisional Government of the ? This Agreement shall take effect AE from this day's date. French Republic subsequent to March 11, 1941, and accepted or It shall continue in force until a date to be agreed upon by the acknowledged by the President on behalf of the United States of two Governments. America. Signed at Washington in duplicate this 28th day of February, Article VII 1945. In the final determination of the benefits to be provided to FOR THE GOVERNMENT OF THE UNITED STATES OF AMERICA: the United States of America by the Provisional Government of the French Republic in return for aid furnished under the Act of Congress of March 11, 1941, the terms and conditions thereof shall be such as not to burden commerce between the two countries, but to promote mutually advantageous economic relations between FOR THE PROVISIONAL GOVERNMENT OF THE FRENCH REPUBLIC: them and the betterment of worldwide economic relations. To that end, they shall include provision for agreed action by the United States of America and France, open to participation by all other countries of like mind, directed to the expansion, by appropriate international and domestic measures, of production, employment and the exchange and consumption of goods, which are the material foundations of the liberty and welfare of all peoples; to the elimination of all forms of discriminatory treatment in interna- tional commerce, and to the reduction of tariffs and other trade barriers; and, in general, to the attainment of all the sconomic objectives not forth Laithe Joint Declaration made on August 14, 1941, by the President of the United States of America and the Prime Minlster of the United Kingdom. Regraded Unclassified TRADE MARK MICROSTAT NO. U.S. PAT. ON. MICROFILM ROLL NO such of the articles eat ... forts 10 whedule 1 engened hereta, to the rovisional of the French by the resident that euch all 1. до longer accessary to the proscoution of the war, in an orderly Dinner which AONTININT Delveen the United tates of carries and vill best procote their natual Internets. the Provisional Government of the French Republic For the curpose of attaining the above-stated obe AS parties signatory to the United Nations jectives, the Government of the United States of america Declaration of January 1, 1942, the Government of the and the provisional Government of the French Republic United States of America and the Provisional Government agree SE follower of the French Republic have pledged themselve= to employ ANTICLE I their full resources, military an? economic, against All aid undertaken to be provided by the United those nations with which they are at var. In the TIPO- States of America under this agreement shall be for lisinary agreement or February 28, 1945 between the Continental France and shall be made available under the Government of the United States of America and the authority and subject to the terms and conditions of the 9 Provisional Government of the French Republie, on the Act of Congress of March 11, 1941, " amended and any principles applying to autual a1d, each contracting appropriation nots thereunder. government undertaker to provide the other -11h such ARTICLE 11 articles, services, facilities and Information useful The united states of Laerien will transfer or remier in the prosecution of their common var undertaking - such of the articles and services net forth in Schedule 1 each any be in a position to supply. annexed hereto, to the Provisional Government of the French the Government of the United States of America and Republic, as the President of the United States of America the Provisional Government of the French Recublic decire may authorize to be provided prior to a determination by to Insure the continuing provision of ruch articles, the President that euch articles and services are no services, facilities or Information without interruction" longer/neosseary to the prosecution of the var. Any oving to any uncertainty AP to the date when the military articles and services not forth In Schedule 1 transferred revistance of the conson enery may and decire to or rendered to the Provisional Government of the French Insure further that such articles, services, facilities Republic prior to such determination shall be provided or information as shall be screed to be furnished by the upon terms the final determination of which shall be de- United States for the curpose of providing ver alt to ferred until the extent of lend-lease aid provided by the the Provisional Government or the French Republic shall United States of America and of recigrocal ald provided be disposed of not transferred, following . determination by the by the raded R MARK MICROSTAT REG. 5. PAI. OHI. MICROFILM BOLL NO such If for articles sal currier --1 forth to abodule , Entryed hereto, to the powisional of the Freneh by the resident that such e11 1. no longet accessary to the procession of the war, in an orderly maner which Detreen the United tates of /arries and vill Doot promote their autual Internate. the Provisional Government of the French Recublic For the curpose of attaining the above-stated obe As parties signatory to the United Natione jectives, the Government of the United /tates of Accrios Declaration of January 1, 1942, the Government of the not the provisional Government of the French Republic United States of America and the Provisional Government agree as followe: of the French Republic have pledged themselve. to employ ANTICLE I their full resources, military and economic, arainst All ald undertaken to be provided by the United there nations with which they are at vap. In the pre- tater of America under this agreement shall be for lisinary agreement of February 28, 1945 between the Continental France and shall be made available under the Government of the United States of America and the authority and subject to the terms and conditions of the Provisional Government of the French Republic, on the not of Congress of March 11, 1941, At amended and any principles applying to outual a14, lesch contracting appropriation acto thereunder. government undertaker to provide the other -1th such ARTICLE 11 articles, services, facilities and Information useful The United dates of Amerion will transfer or render in the prosecution of their common VAP undertaking RS such of the articles and services net forth In Schedule 1 each any be in a position to supply. annexed hereto, to the Provisional Government of the French The Government of the United States of Anerios and Republic, as the President or the United States of America the Provisional Government of the French Recublic decire any authorize to be provided prior to a determination by to losure the continuing provision of ruch articles, the President that such articles and services are no services, facilities or Information without interruction" longer necessary to the prosecution of the var. Any owine to any uncertain " to the date when the milltary articles and services not forth in Schedule 1 transferred resistance of the DOISE enery any ast desire to or rendered to the Provisional Government of the French Insure further that ou rtieles, services, facilities. Republic prior to such determination shall be provided or information as what agreed to be furnished by the upon terms the final determination of vhich whall be de- United States for or provideng ver 414 to forred until the extent of lend-lease aid provided by the the Provisional Gover of the French Republic shall United States of America and of reciprocal a14 provided be disposed of and tre pred, following . determination by the by the Regraded Inclassifie PRECISION TRACE MARE MICROSTAT use PAT. OFF MICROFILM ROLL ON 12" by the Provisional Government of the French Republic is within such periods of time no may be authorized by law, known and until the progress of events makes clearer and the Provisional Government of the French Republic the final terms, conditions and benefits which will be agrees to accept, the defense articles set forth in in the mutual interests of the United States of America Schedule 2, annexed hereto. The Provisional Government and France, in accordance with the terms of the pre- of the French Republic undertakes to pay the United liminary agreement of February 28, 1945, and which will States of America in dollars for the articles transferred promote the establishment and maintenance of world peace. under the provisions of this Article in accordance with ARTICLE 111 the terms and conditions prescribed in sald Schedule 2. After a determination by the President of the United ARTICLE V States of America that any of the articles and services not forth in Schedule 1 are no longer necessary to the Changes may be made from time to time in the items prosecution of the var, the United States of America will set forth in Schedules 1 and 2 annexed hereto, by mutual transfer or render, within such periode of time as may agreement between the United States of America and the be authorized by lav, and the Provisional Government of Provisional Government of the French Republic. the French Republic vill accept, such articles and The Provisional Government of the French Republic services as shall not have been transferred or rendered shall be released from its obligation to accept articles to the Provisional Government of the French Republic prior or services, under Article III and Article IV above, upon to said determination. payment to the Government of the United States of America The Provisional Government of the French Republic of any net losses to the Government of the United States undertakes to pay the United States of America in dollars of America including contract cancellation charges re- for the apticles and services transferred - rendered us- sulting from the determination of the Provisional Govern- der the provisions of this Article in accordance with the ment of the French Republic not se accept such articles terms and Readitions preseribed in Schedule 1 annexed or services. herete. Delivery of any articles or services, under the provisions of Article III IV, may be withheld ANTICLE IV by the Government of the States of America without The United States of America undertakes to transfer cost to the Provisional ment of the French Republic to the Provision Government of the French Republic, whenever the President lines that such action is in within the national interest. ARTICLE VI Regraded Unclassified PRECISION TRADE MARK MICROSTAT REG.U.S.FAT.OFF MICROFILM sou NO. 12" -D- SCHEDULE I ANTICLE VI The terms and conditive upon witch the articles and Any amounts paid to the Government of the United services listed below are to be transferred by the United States of America pursuant to the term of this agreement States of America to the Provisional Government of the shall be deemed to be among the benefits or consider- French Republic after the determinati n. by the President ations provided by the Provisional Government of the of the United States that such sió is no longer necess FJ French Republic pursuant to Article VI of the preliminary in the prosecutt. of the ver, in adcordence -116 Article agreement of February 28, 1945. III hereof, are .. follows: 1. Unless stherwise provided by autual agreements, transfers of articles shell take place, and title on risk of loss shell pain to the Provisional Government of the French Republie, immediately upon loading of the articles on board 00015 vessel in - United states port, provided, that those articles which, prior to the end of the periods outhorized by law, shill have ve been contracted for by the United States Government and shell not have been transferred to the Provisional Government of the French Republic -- above set forth, shell be deemed to be transferred, and title end Pick of loss shall pass to the Provisional Government of the French Republic, upon the last day of such periods. B. The amount which the Provisional Government of the French Republic shall pay to the United states of America for articles transferred und F the provisions of Article III of this Agreement, shall be the total purchase price, which shall be the our of the following items, as determined by the President of the United states, or an officer of the United States Government designated by him: Regraded Unclassified RECISION TRADE MARK MICROSTAT RIG. FAIL OFF. MICROFILM sou NO 2" - 2 - - a 1. The price of the orticles, which shall be (b) The determination of the said price determined as follows: of supplies by the President, or an officer (a) In the 01.00 of standard AND , lies of the United States Government designated by the :rice shall be the current sale price his, shall be usde in accordance with the or the adjusted contract price, whichever following definitions: 1s lover; provided, that in the event the The term "standard supplies' shall sean current sale rice to not the those supplies which have been contracted for price shall be the adjusted contract price by the United States Government in accordance less five per cent of such adjuste: contract with standard United States apecifications. price. The term "non-standard supplies' shall nean In the case of non-stendent supplies those supplies which have been contructed for witch shell have been delivered to the United by the United States Government in Loooriance totes by the contractor rior to thirty days with non-standard United States specifications. following the date of # determination by the It 10 understood that those supplies which are President that such articles (20 no longer standard except for ainor non-standard features, necessary in the prosecut! a of the var, the attachments or adjustments shall be deemed to price shell be the ourrent sale rice or the be standerd supplies. adjusted contract pice, whichever is lower; The term "adjusted contract price' shell provided, that in the event the current sale mean the contract purchase price f.o.b. point of rice 18 not determined, the rice shall be origin paid by the United States Government to the adjusted contract (rice less five per cent the contractor, less five per cent of such con- of such adjusted contract rice. In the CARD truet purchase price, or, If such contract pur- of non-stenderd supplies which shall have chase price sannot be determined for the partie- been delivered to the United States by the ular supplies transferred. the extimated storage contractor subsequent to thirty days following contract purchase price f.o.b. point of origin the aforessid date of the catermination by the paid by the United States lovernment for affiler President, the price shall be the adjusted supplies during a period of three zonths preseding controst price. the aforesaid date of the determination by the Regraded Unclassif RECISION TRADE MARK MICROSTAT KEG. PAT. OFF. MICROFILM ROU 9 12" - 4 - - B - President of the United States, less five per of this Agreement, shall be made by the Provisional cent of such average contruct purchase price. Government of the French Republic within 4 period of thirty he term "current male price" of particular years after the execution of this agreegent. standard or non-stendard supplies transferred to 1. Payment of the total purchase price of any article the rovisional Government of the French Republic so transferred shall be sade in equal annual installments shall nean the price at which similar standard the first of which shall become due and payable on July 1, supplier of comparable quality and in comparable 1946. or on the first of July next following the day on quantity have been sold by the United States which such article shall have been transferred. whichever Government, at or about the time of transfer of is later. the particular supplies to the Provisional Gov- 2, Nothing herein shall be construed to prevent the ernsent of the French Republic. to any foreign Provisional Government of the French Republic from anti- or domestic buyer. It 1a understood that "foreign sipating the payment of any of such installments or any or Comestic buyer" shall be decaed to exclude part thereof. ? United States Government agencies, States and a. If, by agreement of the United States of America political sub-divisions thereof. United States and the Provisional Government of the French Republis, it public, charitable, or educational institutions. is determined that, because of extraordinary and adverse relief organizations, and any persons or organiza- sconomic conditions arising during the course of payment, tions which say purchase supplies on special the payment of & due installment would not be in the finamcial terms provided by lav. joint interest of the United States and the Provisional 2. The sun of any costs for inland transportation, Government of the French Republic, payment may be post- storage. insurance and other charges incidental to delivery pened for an agreed upon period. of the articles at shipside, insurred by the United States, D. Interest on the unpaid balances of the total pur- as determined by the President of the United States or an chase price determined under paragraph B above for any officer designated by him. The United States vill inform article so transferred, shall be paid by the Provisional the Provisional Government of the French Republic from time Government of the French Republic at the fixed rate of to time of the amounts of such costs insurred and the bases two and three-sights per cent per annum, secruing from on which they have been determined. the first day of July, 1946 or from the first day of July c. Payment of the total purchase price for all next following the day on which such article shall have articles transferred under the provisions of Article III been transferred. whichever 1s later. Interest shall be Regraded Unclassified PRECISION TRADE MARK MICROSTAT MICROFILM BOLL NO transferred, Mildhever is later. Interest stall be payable annually, the first payment to be made on the first day of July next following the first day of July on which (continued) such interest began to accrus. short Life Manufecturing Equipment for VaP Production 260,000,000 B. the Provisional Government of the Franch Republic Freight Charges (Rental and Charter of Voscela) 220,000,000 shall pay to the United States the cost of the services $1,676,000,000 listed in this schedule to the extent that such services shall be rendered to the Provisional Government of the SCHEDULE a Frensh Regublic following the determination by the President The terms and conditions upon which the supplies that such services are no longer necessary to the prosecu- listed below -70 to be transferred by the Government of tion of the var. The cost of such services, so rendered, the United States of America to the Provisional Govern- shall be determined by the President of the United States ment of the French Republic under the provisions of and shall be paid by the Provisional Government of the French Apticle IV of this agreement are as follows: Republic in accordance with the same terms as provided for 1. Transfers of articles shall taxe place, and the payment of the total purchase price of the articles pro- title and pick of loss shall pass to the Provisional vided harsunder, as set forth in Section C above. Interest Government of the French Republic, upon the same terms shall be paid on the unpaid balances of the cost of such at 170 set out in Schedule 1 annexed to Sale agreement. services in accordance with the terms of section D hereof. 2. The Provisional Government of the French Republic The total purchase price value of all the articles shall per to the United States of America, upon transfer, and services in this schedule I shall not exceed an amount equivalent to twenty (20) per cent of the total $1,675,000,000. Juch articles and services and their purchase price, as defined in Schedule 1 above, of the estimated cost to the Government of the United States articles transferred to the Provisional Government of the are as follows: French Republic under the terms of Article. IV of this have Materials For Far Use and Essential agreement. Civilian Supply (Cotton, Netals, Steel s. The Provisional Government of the French Republic Chemicals, Synthetic Rubber, Drugs, Medical Supplies, etc.) 840,000,000 shall pay the United States of America the balance of the Food (Rilk, Pulses, Edible 011s, 011 Seed, weeds) total purchase price of the articles transferred ender 185,000,000 Petroleum Supplies Apticle IV of this agreement on or before the lest day 132,000,000 French Prisoner-of-war Supplies of the thirtieth year following the day upon which this 48,000,000 agreement La executed. Payment of the belance of the total purchase price with regard to each article 60 trans- forred shall be made is equal annual installments, the RECISION TRADE MARK MICROSTAT NG. PAL OFF. MICROFILM ROLL NO. 12" ( - 7 - later. Interest d'all be payable annually, the first first of which shall become once and on July 1, 1940 payment to be nade on the first day of July next follow- or on the flort of not cellexing the Pay - when Ing the first day of July on which such interest began to ever article chall better hern - In accrue. later. / 0. The total purchase price value of the articles 4. Nothing Servin shall be constries to amerent the revistonal Government of the French Persible - cnti- in this Schedule 2 shall not exceed a total of $900,000,000. cipating the payment of my of with installments. or of The articles in this Schedule 2 and their estimated cost to the Government of the United States of America are any gart thereof, as follows: 5. If by agreement of both communicts " :- ceter- mined that because of extraordinar economic onn- Locomotives $200,000,000 ditions arterny curing the course of payment the payment Mailroad Cara 120,000,000 of a due installment sould not be in the joint interest of Merchant Herines 140,000,000 the United tutes of meries and the provisional lovern- Harbor Watercraft 32,000,000 ment of the French Tegublic payment may be cost oned for Flahing Meet 8,000,000 an agreet-uson period. Inland Watercraft (Darges) 50,000,000 5. The cont or expenses for overnave transportation Notal orking Machinery 100,000,000 of any of the articles listed in this "chedule 2 ATP Industrial Equipment 150,000,000 included in the item "Freight Charges" listed in Schedule 1 lachinery for lines, Arsenals, etc. 100,000,000 and shall be paid by the Provicional lovernment of the French Republic on the terms specified in that behedule, Such cost or expenses shall be limited to "Freight Charges $200,000,000 on United States versele. Signed at Washington in duplicate U.1a 28th day of 7. Interest on any ungale portion of the balance of February, 1945, the total purchase price, above specified. of any article For the Provisional Government of the French Republic: 80 beansferred shall be paid by the Provisional Government of the French Republic at a fixed rate of e 3/8 nen- cent per annum scorwing from the first day of July, 1946 or from the first day of July next following the day on which For the Government of the United States of America: such article shall have been transferred. whichever If Regraded Unclassified RECISION TRADE MARK MICROSTAT REG. FAI. OFF MICROFILM BOLL 9 2" - 2 - shall be disposed of and transferred, following a deter- mination by the President that such aid is no longer the Provisional Government of the Decessary to the prosecution of the war, in an orderly French and the United States of America nanner which will best promote their natual interests. As parties signatory to the United Nations Doclars- for the purpose of attaining the above-stated tion of January 1, 1942, the Provisional Government of objectives, the Provisional Government of the French the French Republic and the Government of the United Republic and the Government of the United States of America States of America have pledged themselves to employ agree as follows: their full resources, military and economic, against ARTICLE those nations with which they are at var. In the pre- All aid undertaken to be provided by the United liminary agreement of February 23, 1945, between the States of America under this agreement shall be for Provisional Government of the French Republic and the Continental France and shall be nade available under the Government of the United States of America, on the authority and subject to the terms and conditions of the principles applying to mutual aid, each contracting not of Congress of March 11, 1941, as accerated and any government undertakes to provide the other with such appropriation note thereunder. articles, services, facilities and information useful ARTICLE II in the prosecution of their common war undertaking as The United States of America will transfer or reader each may be in a position to supply. The Provisional Government of the French Republic such of the articles and services set forth in Schedule I and the Government of the United States of America desire annexed hereto, to the Provisional Government of the French to insure the sontinuing provision of such articles, Republic, as the President or the United States of America services, familities or information without interruption may authorize to be provided prior to a determination by owing to any uncertainty as to the date when the military the President that such articles and services are no longer resistance of the common enemy may cassej and desire to necessary to the prosecution of the war. Any articles and insure further that such articles, services, facilities services set forth in Schedule I transferred or rendered or information as shall be agreed to be furnished by to the Provisional Government of the French Republic prior the United States for the purpose of providing var aid to such determination shall be provided upon terms the to the Provisional Termsent of the Prench Republie final determination of which shall be deferred until the shall extent Regraded Unclassified RECISION TRADE MARK MICROSTAT REG. U. PAT OFF MICROFILM IOLL 5 12" extent of lend-lease aid revided by the United States MERCIA IV of America and of reciprocal aid provided by the The United States of merica undertakes to trans- Provisional Government of the French Republic 1s known for to the Provisional Government of the rench Republic, and until the progress of oversta makes clearer the within much periods of time as may be authorized by law, final terms, conditions and benefits witch will be and the Provisional Government of the /rench Depublic in the natual interests of the United States of America agrees to accept, the defense articles set forth in and /rance, In accordance with the terms of the pre- Schedule 2, annexed hereto, The provisional overnment liminary agreement of February 20, 1945, and which will of the French Republic undertakes to pay the United promote the establisiment and naintenance of world peace. States of America in dollars for the articles transferred under the provisions of this Article in accordance with ARTICLE III After a determination by the President of the the terms and conditions preseribed in said Schedule 2. United States of America that any of the articles and ARTICLE Y. services set forth in Schedule I are no longer necessary Changes may be nade from time to time in the items to the prosecution of the war, the United States of set forth in Schedules 1 and 2 annexed hereto, by autual America will transfer or reader, within such periods of agreement between the Provisional Government of the time as may be authorized by law, and the Provisional French Republic and the United States of America. Government of the /rench Republic will accept, such The Provisional Government of the Prench Sepublic articles and services as shall not have been transferred shall be released from its obligation to accept articles or rendered to the Provisional Government of the French or services, under Article III and Article IV above, Republic prior to sold determination. upon payment to the Government of the United States of the Provisional Government of the /rench Republic America of any net loases to the Government of the United undertakes to pay the United States of America in dollars States of America including contract cancellation charges for the articles and services transferred or rendered resulting from the determination of the Provisional under the provisions of this Article in accordance with Government of the French Republic not to accept such the terms and conditions prosoribed in Schedule I articles or services. annexed hereto. Delivery of any articles or services, under the pro- ARTICLE IV visions of Article III and Article IV, may be withheld by the a Regraded I Inclassified PRECISION TRADE MARK MICROSTAT KEG. PAT. OFF MICROFILM sou NO 2" - 5 - by the Government of the United States of America without cost to the provisional Government of the SCHEDULE I french Republic whenever the /resident determines The terms and conditions upon which the articles and that such action is in the national interest, services listed below are to be transforred by the United ANTICLE VI States of America to the rovisional Government of the Any amounts paid to the Govern ent of the United French Republic after the determination by the :resident States of America pursuant to the torns of this of the United States that eveh a10 10 no longer necessary agreement shall be deesed to be asong the benefits in the prosecution of the var, in accordance with Article or considerations provided by the Trovisional Governe III hereof. are AN follows: nent of the French Republic parament to rifele V.I A, Unless otherwise provided by natual agreements. or the prelisinary agreement of Aubruary 28, 1945. transfers of articles shall take place. and title and risk of loss shall pass to the Provisional Government of the French Pepublic, immediately upon loading of the articles on board coean vessel in & United States port, provided. that those articles which, prior to the end of the periods authorized by lav. shall have been contracted for by the United States Government and shall not have been transferred to the Provisional Government of the French Republic as above set forth, shall be deemed to be transferred. and title and risk of loss shall pass to the Provisional Government of the French Republic. upon the last day of such periods. D. The amount which the Provisional Government of the French Republic shall pay to the United States of America for articles transferred under the provisions of Article III of this Agreement shall be the total purchase price. which shall be the sum of the following items, AN determined by the President of the United States, or an officer of the United States Government designated by him: Regraded Unclassified PRECISION TRADE MARK MICROSTAT A16. PAT. OFF. MICROFILM BOLL 9 12" - 2 - / 1 The price of the articles. which shell be - 3 - determined " follows: (b) The determin tion of the seld price (a) In the our of standard supplies of supplies by the Freatient, or an officer the price shall be the current sale price of the United States Government designated by or the adjusted contract price. whichever him, shall be made in accordance with the is lover; provided that in the event the following definitions: surrent sale price 1n not determined. the The term "standard supplies' shall year price shall be the adjusted contract price time supplies which have been contracted for less five per cent of such adjusted contract by the United States Government in accuriance price. with standard United lates agecificati ne. In the case of non-standard supplies The term "nun-standerd supplies' shall seal which shall have been delivered to the United those supplies witch have been contracted for States by the contractor prior to thirty days by the United States Government in accordance following the date of & determination by the with non-atenderd United States apecifications. Freeident that such articles are no longer It 10 unterstood that those supplies which are necessary in the prosecution of the var, the standard exce, $ for minor non-standerd features, price shall be the ourrent sale price or the attochments or adjustments shall be deemed to adjusted contract price, whichever Le lower; be standard supplies. provided that in the event the current sale The torn "adjusted contract price" shall price 10 305 determined. the price shall be mean the controct purchase price f.o.b. joint of the adjusted intract price less five per cent origin paid by the United States Government to of such $43 contract price. In the case the contractor, less five per cent of such come of non-stam pplies which shall have tract purchase price, or, If such contract pur- been delivery the United States by the chase price cannot be determined for the portie- contractor out nt to thirty days following ul-r supplies transferred, the estimated storege the aforesaid if the determination by the contract purch/se price f.o.b. point of origin President, the shall be the adjusted poid by the United States Covernment for similar contract price, supplies during period of three months preseding the aforessid date of the determination by the PRECISION TRADE MARK MICROSTAT MICROFILM ROLL NO 12" 4 President of the United States, less five - of this Agreement, shall be made by the Provisional cent of such contract purchase price. Government of the French Republic within a period of The term "current sale rise* of rticular thirty years after the execution of this agreement. standard or non-stenderd eup lies transferred to 1. Payment of the total purchase price of any the Provisional Government of the French Republic article 80 transferred shall be made in equal annual shell seen the price it which simil-r standard installments the first of which shall become due and supplies of comperable quality and in comperable payable on July 1, 1946, or on the first of July next quantity have been sold by the United States following the day on which such article shall have been Government, at or about the time of transfer of transferred, whichever is later. the porticular supplies to the Provisional Gove 2. Nothing herein stall be construed to provent erament of the French Republic, to any foreign or domestic buyer. It is understood that "foreign the Provisional Covernment of the French Republic from or domestic buyer* shall be decided to excluie anticipating the payment of any of such installments United States Government agencies, States and or any part thereof. political sub-divisions thereof, United States 3. If, by agreement of the Provisional Government public, charitable, or educational instituti na, of the French Republic and of the United States of America, relief organizations, end any persons or organiza- it is determined that, because of extraordinary and tions which may purchase supplies on special adverse economic conditions arising during the course of financial terms provided by law. payment, the payment of 4 due installment would not be 1. The run of any costs for inland transportation, in the joint interest of the Provisional Government of the storige, insurance and other charges incidental to delivery French Republic and the United States, payment may be of the articles at shipside, incurred by the United states, postponed for an agreed upon period. as determined by the President of the United States OF an D. Interest on the unpaid balances of the total pur- officer designated by his. The United States vill Inform chase price determined under paragraph B above for any the Provisional Dovermment of the French Republic from time article so transferred, shall be paid by the Provisional to time of the amounts of such costs insurred and the bases Government of the Prench Republic at the fixed rate of two on which they have been determined. and three-oights per cent por arvan, accruing from the c. Payment of the total purchase price for all first day of July, 1946 or from the first day of July next articles transferred under the provisions of Articl- III following the day on which such article shall have been transferred, Regraded -RECISION TRADE MARK MICROSTAT MICROFILM BOLL NO 12" payable annually. the first payment to be made on the (continued) first day of July next following the first day of July hort If- handfacturing Agripment for or Possetion $1,000,000 on which each interest begin to accrue. might Charler =. The Provisional Government of the French Republic of Verselal 250.000.000 shall pay to the United States the cost of the services $1 675,000.000 liated in this schedule to the extent that each services shall be rentered to the Provisional Government of the The INC conditions u,on which the supplies French Republic following the determination by the Fresident Tisted are to be transferred by the Government of that such services are no longer necessary to the process- the United tales of muriou to the revisional lovern- tion of the var. The cost of such services, no rendered, cent of the "rench Republic under the revisions of shall be determined by the President of the United States rticle TV of the agreement are LE follows: and shall be paid by the Provisional Dovernment of the rensters of articles stall take Have, and French Republie in accordance with the same terms as pro- title and del of loss shall pass $0 the revisional vided for the payment of the total purchase price of the Government of the French rejublic, upon the case terms articles provided hersunder. " set forth in Section C as are det out in chedule ¹ annexed to this agreement. above. Interest shall be paid on the unpaid balance of 2, Title revisional Government of the "rench spublie the cost of such services in accordance with the terms shall pay to the United Sales of America upon transfer. of section D hereof. AA amount equivalent to-twenty (20) per cent of the total The total purchase price value of all the articles purchase pribe. 11 defined in Johedule 1 above. of the and services in this schedule 1 shall not exceed articles transferred to the Provisional Government of the $1,078,000,000. Fueb articles and services and their French Republic under the terms of riclele IV of this estimated cost to the Government of the United States agreement. are of follows: 3. The Provisional Government of the French Republie hav Materials for Var Use and Fesential shall pay the United States of America the balance of the Civilian Supply, (Cotton, Netale. Steel Chemicals, Synthette Rubber, Leage, total purchase price of the articles transferred under Medical Supplies, etc.) $ 840,000,000 Article IV of this agreement on or before the last day Food (REIX, Pulses, Edible 0116, 011 Deed, Seeds) 185,000,000 of the thirtieth year following the day upon which this Patroleum Supplies 132,000,000 agreement 1. executed. Payment of the balance of the French Prisoner-of-ver Supplies 48,000,000 total purchase price with regard to each article no trans- ferred shall be made in equal annual installments. the Regraded Unclassified PRECISION TRADE MARK MICROSTAT MICROFILM ROLL NO. 12" - 5 - payable annually in first payment to be made on the 7. first day of July following the first day of July (continued) on which such invement began to accrue. hort Wrs handfusturing quipment =, The Provisional Government of the French Republic for or requelion $2,000,000 shall pay to the United "tates the cost of the services resight Ca DATE nation harter of Yersein 200,000,000 listed in this schedule to the extent that ench services ET 675,000,000 shall be rentered to the Provisional Government of the French Republic following the determination by the Fresident that such services are no longer necessary to the prosequ- The types can conditions u,on which the supplies tion of the vap. The cont of such services, no rendered, listed color are to be transferred by the Government of shall be determined by the President of the United States the United tates of aerioa to the rovisions' lovern- and-shall be paid by the Provisional Government of the next of the French Depublic under the provisions of French Republie In accordance with the same terms as pro- rtiole by of this agreement are - follows: vided for the payment of the total purchase price of the "ransfers of articles Hall take Name, and articles provided hereunder. " set forth in rection c title wat an of loss shall pass to the rovisional above. Interest shall be paid on the unpaid balance of Government of the French ublie. upon the come terms the cost of such services in accordance with the terms as are ret out in shedule 3 annexed to this agreement. 2. The revisional Government of the /rench Republic of section D hereof. The total purchase price value of ell the articles shall 202 to the United tatin of America upon transfer. and services in this schedule 1 shill not exceed an amount equivalent to tventy (20) por cent of the total $1,075,000,000. Fuch articles and services end their purchase price, de defined in Vohedule 1 above. of the estimated cost to the Government of the United States articles transferred to the Provisional Government of the French Republic under the terms of rticle IV of this are at followe: hav Materials for NAT Use and Resential agreement, Civilian Supply, (Cotton, Retale. Steel 3. The Provisional Government of the French Republie Chemicals, synthatic Nubber, Trugs, Medical Supplies, etc.) 0 840,000,000 shall pay the United States of America the balance of the Food (RII), Pulses. Edible 0118, 011 185,000,000 total purchase pride of the articles transferred under Deed. Seeds) 132,000,000 Article IV of this agreement on or before the last day Petroleus Supplies of the thirtleth year following the day upon which this French Prisoner-of-ver Supplies 48,000,000 agreement 1. exec ted. Payment of the belone= of the total purchase price with regard to each article 80 trans- ferred shell be Made in equal annual installments. the Regraded Unclassifie PRECISION TRADE MARK MICROSTAT use PAT. OFF MICROFILM ROLL NO. 12" a - 9 first of which shell become due end payable on July 1, 1046, later. Interest shall be payable annually. the first OF on the first of July next following the day on which payment to be made on the first day of July next follow- such erticle shall have been transferred, whichever is lag the first day of July on which such interest began to leter. accrue. 4. Nighing herein shell be construed to prevent the 6. The total purchase price value of the articles Provisional Government of the French Republic from -nti- in this Dehedule 2 shall not exceed a total of $900,000,000. cipeting the payment of any of such installments, Γ of The articles in this Schedule e end their estimated cost to any part thereof. the Government of the United States of America are as 5. If by agreement of both covernments it 10 color- follows: mined that because of extraordinary noverse economic con- ditions arising durlag the enror of payment, the payment Locomotives $200,000,000 of a due installment visit not be in the Joint interest of Railroad Care 120,000,000 the Provisional surement of the French Republic and the Merchant Marines 140,000,000 United States of America, payment any be postponed for Harbor Matercraft 32,000,000 an agreed-up:n period. Fishing Fleet 8,000,000 6. The Dost or expenses for overceas trenspartion Inland Matercraft (Barges) 50,000,000 of any of the articles listed in this Schedule 2 = Netal Vorking Machinery 100,000,000 included in the item "Freight Charges* listed in >chedule 1 Industrial Equipment 150,000,000 and shall be paid by the Provisional Government of the Machinery for Mines, Areenals, etc. 100,000,000 French Republic on the terms specified in that schedule. Such 00:5 or expenses sholl be limited to Mreight Charges' 2900,000,000 on United States vessels. Signed at Washington in duplicate this 20th day of 7. Interest on any unpaid portion of the belance of February. 1945. the total purchase price, above specified, of any article For the Government of the United States of America: so transferred shell be paid by the Provisional Government of the French Republic at a fixed rate of 2.3/8 per cent per asses secruing from the first day of July, /1946 OF For the Provisional Government of the French Republic: from the first day of July next following the day on which such article shall have been transferred, whichew-r La Regraded Unclassified RECISION TRADE MARK MICROSTAT uso FAT. OH. MICROFILM sou § 2" 1. TO OVISTONAL GOVERNMENT OF PHANCE, the AIGHT r BAWARY 28, 1945. OF FINAL DECISION, IN THE LIGHT or IT: CON VOT VIALISIES AND 8:24 POSSIBILITIES, VILL CROVIDE THE UNITED STATES N° IT ASSED FORCE WITH THE POLLOGING TYPES OF ANDI TAXC AO 410, FREEN AND VIRA IN THE VET D NATIONS' RECLARATION of JANUARY 1, 1942, THE TO THE EXTENT THAT IT IF FOUND THAT THEY CAN MONT EFFECTIVELY DE PROCURED IN CONTINENTAL FRANCE. FORTRACTING GOVERNMENTS TO EXPLOY THEIR FULL SERVICE HILITARY OR ECONOMIC, AGAINST THOM DATION WITH VHICH (A) MILITARY STUTEMENT, MUNITION , AND >ILITARY AND they ART AT VARI NO IN THE PRELIMINARY AGREEMENT OF FEBRUARY 18, NAVAL STORTS; 1948 aum N TN GOVERNMENT or THE UNITED STATES AND THE PROVISIONAL (3) OTHER MATERIALS, PACILITIES, SERVICES, GOVERNMENT OF PRANCE 09 THE PRINCIPLES APPLYING TO MUTUAL AID, EACH OR ISFORMATION FOR UNITED STATED FORCES, EXCEPT FOR ONTRACTING GOVERNMENT UNDERTAKES TO PROVIDE THE OTHER VITH SUCH THE FAY, ALLOWANCES, (8) UTHER EMOLDMENTS OF UCH ARTICLES, SERVICES, PACILITIES, OR INFORMATION USEFUL IN THE PROSKOU- PORCES ANY THE ADMINI TRATIVE EXIXNSSS OF AMERICAN TION OF THEIR COMPOS VAN EFFORT AC IT MIGHT BY IN A POSITION TO SUPPLY. MISSIONS: IT : THE UNDERSTANDING OF THE PROVISIONAL GOVERNMENT OF FRANCE THAT (c) SUPPLIES, MATERIALS, FACILITIES, SERVICES, or IN- THE OTKERAL PRINCIPLE TO BY. FOLLOWED IN PROVIDING MUTUAL AID AS SET FORMATION EXCEPT FOR THE YAGES AND BALARIES OF FORTH IN TH SAID AGREEMENT OF FEBRUARY 20, 1948 IN THAT THE VAR PRO- UNITED STATES CITIZENS, NE DED IN THE CONSTRUCTION OF DUCTION AND THE VAR RESOURCES OF BOTH NATIONS SHOULD BE USED BY EACH MILITARY PROJECTS, TASKS, AND SINILAR CAPITAL WORKS IN VATE VHICE MOST EFFECTIVELY OTILIZE THE AVAILABLE MATERIALS, MAN- REQUIRED IN THE COMMON NAM EFFORT; (D) DETTLEMENT AND PAYMENT OF APPROPRIATE CIVIL CLAIMS POWER, PRODUCTION FACILITIES, SHIPPING SPACE, AND OTHER RESOURCES. VITH A VIEW, THEREFORE, TO SUPPLEMENTING THE SAID AGREEMENT OF ARICING IN FATNCH TERRITORY AGAINST THE UNITED FEBRUARY 28, 1948 AND THE HENORANTION RELATING TO LIND-LEASE AND STATES AND ITS ARMED FORCES, EMPLOYEES, AND OFFICERS: REGIPROCAL AID AND THE MINUTKS ATTACHED THERETO, AGREED AND EXCHANGED (E) SHIP BALLAST, IS ORDER TO ASSIST IN OBTAINING MAXIMUM BY THE UNITED STATES AND FRENCH REPRESENTATIVES on AUGUST 25, 1944, EFFICIENCY IN THE USE OF SHIPPING; PROVIDED, BOVEVER, VE HAVE THE HOSOR TO BIT FORTH BELOY THE UNDERSTANDING OF THE PROVI- THAT ANY NIT PROCEEDS RESULTING FROM THE SALE OF SUCH SIONAL GOVERNMENT OF FRANCE OF THE PRINCIPLES AND PROCEDURES APPLICABLE BALLACT SHALL BE PAID TO THE PROVISIONAL GOVERNMENT TO THE PROVISION OF AID BY THE PROVISIONAL GOVERNMENT OF FRANCE TO THE OF FRANCE; ARMED FORCES or THE UNITED STATES AND THE MANNER IN VHICE SUCH AID WILL (7) SUCH OTHER SUPPLIES, MATERIALS, FACILITIES OR SERVICES SE CORRELATED WITH THE MAINTE NANCE OF THOSE FORCES BY THE UNITED STATES AS MAY as AGREED UPON AS SECESSARY IS THE PROSECUTION GOVERNMENT. OF THE WAR, ISCLUDING MATERIAL FOR YAR PRODUCTION, 1. THE ... REQUESTED BY THE UNITED STATES TO BE EXPORTED PROM DE R SORABLE JOBEPH c. GREV, CONTINENTAL FRANCE TO THE UNITED STATES OF AMERICA. LOTING SECRETARY OF STATE, 1. 1, DEPARTMENT OF STATE, (ASHINGTON, D.C. Regraded Unclassified RECISION TRACE MARE MICROSTAT REG. PAI. OFF MICROFILM ROLL NO 12" 2, THE PRACTICAL APPLICATION OF THE PRINCIPLES FORNULATED IN THIS NOTE, INCLUDING THE PROCEDURE BY VHICH RECURSTS FOR ATD BY WITHER GOVERNMENT ARE MADE AND ACTED DPON, SHALL DE WORKED OUT All OCCASION MAY REQUIRE BY AGREEMENT BETWEEN THE TWO GOVERSMENTS, ACTING IF THE GOVERNMENT OF THE UNITED STATES CONCURS IN THE FOREGOING, VE YOULD SUGGEST THAT THE PRESENT NOTE AND YOUR REPLY to THAT EFFECT BE VICEN POSSIBLE THROUGH THEIR APPROPRIATE MILITANY OR CIVILIAN ADMINISTRA- REGARDED AO PLACING ON RECORD THE UNDERSTANDING OF OUR TVO GOVERNMENTS TIVE AUTHORITIES, ASQUESTS BY THE UNITED STATES GOVERNMENT FOR such IN THIS MATTLA AND THAT FOR CLARITY AND CONVENIENCE OF ADMINISTRATION AID WILL BE PRESENTED BY DULY AUTHORIZED AUTHORITIES OF THE UNITED THIS UNDERSTANDING at CONSIDERED TO BE EFFECTIVE AS FROM JUNE 6, 1944. STATED TO OFFICIAL AGENCIES OF THE PROVISIONAL GOVERNMENT or PRANCE VHICH WILL BE DESIGNATED OR ESTABLISHED AT CONVENIENT LOCATIONS FOR ACCEPT, SIA, THE RESERVED ASSURANCES OF OUR NIGHEST CONSIDERATION. THE PURPOSE OF FACILITATING THE PROVISION OF RECIPHOCAL AID. 3. IT 16 THE UNDERSTANDING OF THE PROVISIONAL GOVERNMENT OF FRANCE THAT ALL SUCH AID, AS WELL Aº OTHER AID, INCLUDING INFORMATION, RECEIVED UNDER ANTICLE VI OF THE PHYLIMINARY AGREEMENT OF FEBRUARY 18, 948, ACCEPTED BY THE PRESIDENT OF THE UNITED STATES OR HIS AUTHORIZED REPRESENTATIVES FROM THE PROVISIONAL GOVERNMENT OF FRANCE VILL BE RECEIVED AS A DESEPIT TO THE UNITED STATES UNDER THE ACT OF MARCH 11, 1941. IN OFAR AS CIRCUMSTANCES WILL PRAMIT, APPROPRIATE RECOND OF AID RECEIVED UNDER THIS ARRANGEMENT WILL st KEPT BY KACH GOVERNMENT. IN ORDER TO FACILITATE THE PROGUMEMENT or THE SUPPLIES, MATERIALS, FACILITIES, INFORMATION AND SERVICES DESCRIBED IN DECTION 1 HEREOF BY PERMITTING THEIR DIRECT PURCHASE RATHER THAN THEIR PROCUREMENT BY THE METHODS CONTEMPLATED IN SECTION 2 KEREOF DUAING THE PENIOD OF MILITARY OPERATION AND UNTIL SUCH TIME AS THE OFFICIAL AGENCIES OF THE PROVISIONAL GOVERNMENT OF FRANCE ANY ABLT TO PROVIDE SUCH RECIPROCAL AID IN TEE MARNER CONTEMPLATED IN SECTION 2, THE PROVISIONAL GOVERNMENT or PRANCE TAXES TO MAKE AVAILABLE TO DESIGNATED OFFICERS OF THE UNITED STATES GOVERNMENT SUCH PRESCH CURRENCY on CREDITS AM MAY DE NERDED FOR THE PURPOSK. THE RECESSANT APPANGEMENTS VILL BE MATE BY THE APPROPRIATE AUTHORITIES OF. THE GOVERNMENT OF THE UNITED STATES AND THE PROVISIONAL GOVERNMENT OF FRANCE. Regraded Unclassified MICROSTAT REG. w. 5. PAT. ORE ROFILM ROLL NO. PRECISION TRADE MARK 235 MAR 1945 Dear Mr. Frand: You Inquired concerning our position on the release to the French of information concerning French private assets in the United States. = This question was raleed with our representatives in Paris by 11. Fleven. lie have replied that ve were not at present in a position to consider generally the question of making such Information available and that we would object to my public statement at this time. However, we advised the French that we are prepared to supply in confidence information on the property of apecific persons requested by the French in cases where this would appear to further our comion objectives. We will continue to consider Une general problem. It would be helpful If you could give ae a copy or the approvent between the Chancellor of the Exchequer and M. Fleven, Sincerely yours, (Signed) H. Morgenthau, Jr. Mr. No H. Brand, United Kingdom Treasury Delegation, Box 680, Benjemin Franklin Station, Washington, D. C. Ellger 3/13/45 3930 Regraded Unclassifie PRECISION TRADE MARK MICROSTAT NIG.U.S.M. MICROFILM ROLL Ha, 230 March 13, 1945 HEMORANDON FOR THE BECHETARY'S FILES: lives night well be forestalled by the restrictions imposed upon the regittance in question. He then argued that the requirement The Secretary met with Racois Kalmanovitz, Kotler and Korff in the license to refer back to Washington every request for the and Mr. Bunim at 3:15 0,8,, March 18, 1945, General O'Dwyer and use of the money in question would involve delays and possibly Miss Hodel of the Var Refuges Board were also present. endanger further resoue operations. He requested that with respect to the million Swies france already remitted under the Raboi Korff opened the presentation for the rebbinical license permission be granted to spend this amount for legitimate group stating that they had come to ace the Secretary on three expenditures upon the authorization of Xr. McClelland, the Board's matters: (1) the problems involved in the restrictions 19- representative in Svitzerland. The Secretary stated that the re- cased on the resittance of the $937, 000 to Issão Sternbugh] quest to 60 modify the license was reasonable and General O'Dwyer (2) the obtaining of transportation from Switzerland into Germany; and Miss Hodel concurred. The Secretary then stated that an and (3) the evacuation of refugees from Germany to Switterland by appropriate cable would be drafted and closred with Secretary sease of transportation facilities provided from Switzerland. Stiuson and Secretary Stettinius. The Secretary prefaced nis remarks by stating that he would With respect to the problem of transportation facilities speak to the group very frankly as a government official and from Switzerland to Geruany, the Secretary explained that the with deep and sincere syspathy for their work. He then explained Board was exploring every cossibility of obtaining adequate truck- that our Government's primary concern today 1A the vinning of the INE facilities for the delivery of relief through the International var and the protection of American prisoners of war; that within Red Cross to civilian detainees. Be exclained that the Var Depart- this franework, the high officials of the Government responsible sent had agreed last week to recousend to General Eisenhower that for Wer Refugee Board activities have USED unrealtting in their trucking incilities be made available from United States any efforts to accomplish the purposes for which the Board WEE stocks for this purpose and General Dwyer stated that at the created. He exclained that the mitention that has been given to sene time McClelland is making every effort to outsin transporta- Var Refugee Board matters during the vaging of e var has Deen tion equipment from private sources inside Switzerland. He added amazing and that the accomplishmente to date have been reserkable. that the Swiss Minister had agreed to recommend to his government The Secretary stated that, Decause of the rimary concern of our that Swills Government transcortation equipment be made available Government to win the war, the only decision which could DE re-ched for this surpose. It wes explained that transportation equipment in the Musy natter VES the one nade unanimously by the Board ses- cust be outsined if any relief is to rench these people and If bera at & special meeting called for the sole purpose of discussing any of thes are to De resoued to safety in Switzerland. that problem. This decision vas that no payments for renson to the Germans could De authorized by this Government. However, At to the third question, is VAS explained that the plan Decause of the nossibility that the money in question night be being developed by the War Refuges Board envisages the use of needed for legitimate expenditures and Decause of the Board's relief delivery trucks for the evacuation of physically unfit concern over the saving of the lives of the persecuted minorities detainees from Germany to Switzerland, In addition, 15 was also inside Germany, the regittance in question vie approved with cer- explained that the president of the International Red Cross 18 tain safeguards. now in Germany discussing with high German officials the possible use for such evacuations of trucks being used for the delivery of The Secretary then stated the the Javs in Acerica could orisoner of wer packages. bring great hart to themselves and dangerous anti-Semitic public- ity if it should ever be revesled that any American Jews were At the conclusion of the meeting, the Rabbie presented to dealing directly with Hinnler for she resque of Jews from Germen- the Secretary a written secorandus covering the points which controlled territory. tray had made in their discussion. Xr. Bunis, speaking for the rabbis, stated that they appreci- ated the views expressed by the Secretary but that they felt that the lives involved were so important that husanitarian considers- Preve Apdel tione should prevail in this case and that the saving of more RECISION TRADE MARE MICROSTAT No. PAT. OH. MICROFILM ROLL NO. March 13, 1945 2 PVS THE Twit's EXCEPT lives sight well be forestalled by the restrictions imposed upon The Secretary not with Hapois Lotler and Korff the remittance in question. lie then srgued that Like requirement and Mr. Bunis as 3:10 Marah 10, 1945, General O'Dayer and in the license to refer back to washington every request for the X10g Hodel of the Var Refuges Hoard ware also present. use of the money in question would involve delays and possibly endanger further resour operations. Be requested that with Rebbi Fortf opened the presentation for the rebulnissl respect to the million Swine france sirendy remitted under the group stating that they had aces to ... the Secretary on three license cermission on granted to spend this amount for legitimate matters: (1) the roblems involved in the restrictions In- expenditures upon the authorization of Mr. McClelland, the deard's oxed on the resittance of the 1937, to Isano Sternowsh: representative in Owitzerland. The Secretary stated that the PO- (g) the obtaining of transportation from Ovitterland into Germany: quest to so modify the license WHE ressonable and General 0'Dayer and (3) the evacuation of refugees from Germany to Switterland by and Kiss Hodel concurred. The Searetary then stated that an means of transportation facilities provided from Switzerland. sppropriate cable vould be drafted and cloared with Secretary Stimson and Secretary Stettinius. The Searetary prefeced nie remarks by stating that ne would speak to the group very frankly as a government official and with respect to the roblem of transportation facilities with deep and sincere syspathy for their york. He then explained from Avitzerland to Germany, the Secretary explained that the that our Government's primary concern today 1» the winning of the Board vse exploring story cossibility of obtaining adequate Lruck- var and the protection of American prisomers of war; that within this franswork, the high officials of the Government responsible ned Cross to civilism detaines. de exclained that the war Depart- ing fecilities for the delivery of relief through the International for Var Refugee lloard activities have vesa unresitting in their sent had agreed last week to reconsend to General Eleenhover that efforts to accomplism the superses for which the Board vs.e areated. He explained that the misention that and been given to stocks for this ourcose and General B'Dwyer stated that at the trucking facilities be unde available from United states aray Var Refugee Board matters during the vaging of a var has been same Line MeClelland is seking every effort to obtain transporte- smaring and that the accomplishments to date have Deen remarkable. tion equipment from private sources inside Svitzerland. He added The Secretary stated that, DOBRUSS of the risary concern of our that the 3vise Minister had agreed to recommend to nie government Government to via the war, the only declaion which could be re ched that Swies Government uransportation equipment be ande available in the Musy matter was the one unde unanimously by the Board sea- for this purpose. It via explained that transportation equipment care at a special meeting called for the sole purpose of discussing must be obtained if any relief 1a to reach these people and If that problem. This decision was that no payments for reason to any of them are to be resourd to safety in svitzerland. the Ourmans could De authorized by this Government. Hovever, uscause of the cossibility that the maney in question sight be Ae so the third question, is use explained that the ,,Lan needed for legitimate expenditures and Decause of the Board's relief delivery trucks for the evacuation of physically unfit being developed by the war Refugee Hoard envisaged the use of concern over the saving of the lives of the cersented sinorities inside Germany, the remittance in cuestion was approved with our- detainees from Germany to Ovitzeriand. In addition, 1% vas also tein enfaguards. explained that the president of the International Red Gross 1s in Gergeny discussing with high German officiale the possible The Secretary the stated the the Jose in Assrics could now use for such evacuations of trucks being used for the delivery of bring great here to incusalves and dangerous anti-Demitio public- nrisoner of war reckages. ity if it should ever De revealed that any American Jaws were dealing directly with Himmler for the ressue of Java from Depair- AS the conclusion of the meeting, the Rabbis presented to controlled territory. the Secretary 6 written gesorandum covering the pointe which they had made in their discussion. Mr. Bunis, speaking for the rabbie, stated that they approci- ated the views expressed by the Secretary but that they felt that the lives involved were 80 important that humanitarian considera- (#lenad) Florence Hodel tions should prevail In this case and that the saving of sore FHIM 3/15/45 Regraded Unclassified PRECISION TRADE MARK MICROSTAT/ a PAT. OFF. MICROFILM ROLL NO. 242 and apparent attractions offered to the henchmen really cannot matter or in any way affect the war effort or the postwar plan. MEMORANDUM So much can be accomplished with so little. There are four positive steps that say be taken to help March 13, 1945 materialize and bring to fruition the Mussy plan. 1. The United States Embassy in Switzerland and the Swins Government should be apprised that Bushington 18 anxious Sie respectfully present these facts for your kind for the realization of this resoue work, by means of further transports to Switzerland. They should be requested to take consideration: all possible steps to help its realization. Our representative, Isaac Sternbuch in Montreux, Switzerland, has engaged the services of the Swine Federal 2. Financial means should be made available to Hussy Councilor Mussy in an attempt to rescue from the mirderous to defrey transportation costs, gratuities to petty officers, RECEIVES hands of the Nazia us many Jews NO can be caved from the con- both In Switzerland and Germany and other incidental expenses. centration camps and brought to places of safety with the help Tie respectfully submit that license number 2426 be EO amended and consent of the Swiss Government. 58 to free this money to the discretion of Sternbuch. The time lost between the inquiries that McClelland may make from The war Refugee Board, has at all times encouraged this Washington and the receipt of an answer may cost thousands of rescue work and has given our Committee sid and assistance, human lives. Exchange of messages require at least 8. week in consistent with our humanitarian endeavors. each specific instance, and each hour means 50 many more lives lost. For years we here, Jews and non-Jewa alike, cried, pleaded and protested against German cruelties, but no arrest- 3+ Transportation from Germany is inadequete, and the ing hand could be found to stop the ruthless hands that starved, Jows cannot be transported into Switzerland. We respectfully asphyxiated, cremated or buried alive five to six million inno- submit that the U. S. representative in Switzarland be instructed cent man, women and children of the Jewish faith. to contact the International Red Cross with a request that the trucks which bring food and medication into Germany be made Now the Mussy plan seema to neet with " measure of available when empty on their way back to Switzerland for this success. A transport of 1210 already arrived on February 7, purpose: to seek other possible means available or created for 1945. Our representative advised us that similar transports that purpose, even to the extent of hiring trucks or chartering would follow wookly. Newspaper reports emanating from Switzer- buses. land substantiated his statements. The Federal Prosident of Switzerland has issued sinilar reports to the Swiss press. 4. Since the Swine economy may not be able to absorb Since February 7, 1945 five weeks have passed and no new trans- more refugees, we respectfully submit that evacuation of some porta have arrived. Apparently sono factors have presented of the previous arrivals be made without delay to comparative themselves to blook this rescue medium. places of safety and security to nake room for additional arrivals. It cannot be the 3wins Government, for we have very diatinct reports that the Federal President Von Steiger and the The urgency of all the above is beyond description. The Swiss press received this transport cordially and extended their Samis have murdered ruthlessly innocent nen and women and have hospitality to an unlimited number to follow. singled out for destruction those of the Jewish faith, in their frantic moments of despair before any retreat was made. 30,000 It cannot be public opinion here, for any newspaper that Jews were killed in Lodz, the lest day before the Russians took found this news worthy of reporting gave it a glad hand. over. Now that the position of the Mazia has become untenable, the Date of the several thousand remaining Jaws in Nazi occupied If our Allies offer an attitude of reluctance, we be- countries in beyond sane contemplation. lieve that they can readily understand that einor, insignificant Regraded Unclassified PRECISION TRADE MARK MICROSTAT REG. w. 5. PAT. OH, MICROFILM ROLL NO. 244 If, however, a small transport of 1200 1a saved weekly, the fow so saved will be out of deathly danger, but moreover the Mazi officials will treat the remaining interness with a little human compassion, knowing that the world at large will receive oye-witness reports. March 13, 1945. We appeal to the conscience of the United States of America, the land that vas founded as a model of democracy, human conscience and the araepal of norality for the democracies of the world. Help the remmant of n. decimated people In Birope, in these Inst moments before the curtain drops on the nost tragic and nost unpardonable fato that will meted out to a people that Dear Mr. Delss: brought the word of 0-d to humanity. I appreciate your courtesy In sending me It appoars that the potentialities for the realization the First March Issue of Executives' Ear Digest of these transports 110 entirely in the hands of Washington. and note the attention given to the Bretton Wonds agreements. I en also clad to know that In a report submitted to us dated March 7, 1946 from the Independent Bankers Association report on our representative, Jacob Griffol in Palestine, we learn that Bretton Woods will be given attention in the the Swedish Government promised to admit all the Inmates of next issue. Bolson-Bergen and part from Theresienstadt, concentration camps. The business men who are your readers will We respectfully request that the American Embasy In all find their future operations affected, di- Sweden be apprised of our anxioty for the realization of this rectly or indirectly, by the nature of world promise and be requested to spare no efforts in this additional economic conditions after the war, and I 83 sure avenue of rescue. you recognize the importance that the Bretton VAAD HA'HATZALA Pabli Woods agreements may hold in shaping those con- Rabbi ar. notler Bama Korl ditions. In the thought that you might be interested, 10. I am enclosing the text of an address which I delivered at Minneapolis this week. Sincerely, (Signed) - 4a Mr. Jay Delse Managing Altor, Executives' War Digest 420 Madison Avenue New York 17, New York EBF/mah Regraded Unclassified CISION RAIN MARE MICROSTAT MICROFILM 12" Executives: WAR DIGEST March 12, 1948 The Honorable Secretary of the Treasury, Hanry F. Morganthau Washington 25, D. 0. Dear Mr. Secretary: You will be interested, I believe, in the references to Bretton Woods in the attached copy of EXECUTIVES' WAR DIGEST, I am sending it to you at the suggestion of Randolph Feltus. The WAR DIGEST has been requested by about twenty-five thousand key business executives throughout the country. We have included an item on the report of the Independent Bankers' Association on Brotton Woods in the next Lesse of the WAR DIGEST currently on the press. Cordially, Jay July Defin, Managing Deiss Bditor EXECUTIVES' WAR DIGEST JDilg WAR DIGEST la published for Idison by Green-Bradia, Inc., 489 Medican Avenue, Haw York 17, Plan RECISION TRADE MARK MICROSTAT NG. PAT ONE MICROFILM HOLL NO Executives to ane particular, the versing or composer indicio- tien the May-Ralley wroten Look 11ke work DOUP. The new propossir ...Every individual is collented to serve the Nation in that enposity far which be en obe is best qualified." May-Bailey bill la limited to New, WAR A handy summary of timely information for business men, sent to 15-45. K-V-Y MIII includes men and women, all neve. DIGEST you INVICE . month with the compliments et Thomas A. Edison, Inc. Another significant difference plages WMC under the working direction or West Orange New Jeriey The Edison Volcewsiter increases syrnes' Office or Ear Mobilization and Recouversion. and cuta away the the accomplishment of the business executive by 10% to 50% role of Selective Service as a controller of labor (n poot point since the Noy-Moiley bill was first under discussion). 5 Mennwhile, the Army---impotient Issue and FIRST MARCH EDITION at legislotive delays---has gone 1 F 4 5 about with a "progrom" of sumpover centrol over registrants under 38. Though attention avoide sharply lait fortnight from demostic prot- Mem not physically qualified for 12/4 Crime conference. emposser has remissed the Bo, 1 browfront insur. general allitary service, but who have left war jobs, are being inducted An for the Talta declaration---it released optimism very nearly unprecedented into the Anny, They will be given 4 in war-worn Washington, and sent stock markets sooming in New York and wouks besie training at a special London. Gist of Washington opinions *Now we're getting down to business!* coup. and than be REVEN a "cholice" of returning to war industry (at prevail- After the happy interiude, the manpower headache refused to respond to any Ing wages), or being assigned Arwy duty. of the medicine thus far concected by Army-Navy-Selective Service. The (Incidentally, "a very limited number of men" in the age group 18 to 30 can Senste continued stalling on the Noy-Bailey bill, and annagement. & labor con- be certified as essential, says Selective Service. Local boords should have tinued to ronr disapprovul. Secretary of for Stimpon, in appealing for the details of new ruling: if net, write to Washington for latest changes.) bill, spoke tartly of the "confusion of voices," and exclaimed, "We dare not delay longer.* A little earlier, Under Secretary Robert Patterson ripped to Herald of the tremendous importance hengeforth to be placed on interpational shreds WMC's prize package of priority referrals and employment cellings: agreements, the Bretton Woods monetary plan was introduced into Congress last "No noticeable effect in releasing workers fop vor plants hea been folt." fortnight. The bill itself was dram by Senators Ragner and Tobey, and Patterson also pooh-poohed the "Allentown plan." involving voluntary shirt Representatives Spence and Wolcott---- bi-partisen group. Secretary of the of workers from less essential to more estential plants. Treasury Morgenthou called it, "The first step in meeting the greatest shal- lenge of all history--the schallenge of n. lasting pence." More circumspect so.the minpower issue wo.d WFR chief Krus. His appeal stressed merely the need for *seme kind" of conpower legislation. Promptly be was The Bretton Woods Agreemento Act* would establish an International Bank for obliged by Senntors Kilgore, Wagner, and Ferguson, who introduced B DEF measure Reconstruction and Development, to sake available long term credits to DEG- designed, in their own words. "to promote the most effective utilization ber nations. Equally important, on International Monetary Fund is proposed, of manpower." rather than raise bogies of "compulsion versus men-compulsion." to stabilise the value of all member currencies relative to each other. The basic purpose of the Fund, says Morgenthou, is to prevent the type of pre- Both labor and business rollied immediately to the new bill. Sald the CIO: sar "competitive currency depreciation* which led to such explosive results. "This bill La a long step in the right direction." The AFL agreed. Said Though the American Bankers Association has questioned the need for the Fund NAM President Irn Mosher: The most constructive yet offered." The U.S. (WAR DIGEST #82), of some 250 nationally preminent economists polled, 224 Chamber of Commerce agreed. The Senate Military Affairs Committee indicated, gave it whole-hearted approval. 12-18, that they preferred it to the May-Bailey sensure--and by a vote of 12-6, pigeon-holed the latter. The Administration has deferred to the authority et Congress on several stra- togic points related to the Agreements. Without Congressional approval, the Provisions of the Kilgore-Wogner-Fergunen offering ex- par (gold) value of the dollar any not be changed. no plain ito exceptional ability to win friends and 10- neendments to the Fund any be accepted, mor may the Bank's fluence people. In n matabell, its (1) Controls - copital stock be increased. Noted the 224 economists ployment in both ensential and non-essential industries. with deep solemnity: "If the present proposals are not (2) Makes mandatory labor utilisation surveys in pri- vides paid transportation to essential jobs. (4) Safe- VICTORY PRODUCE WE FROM retified by the lending countries of the world, the out- vate plants and In Army-Novy installations. (3) Pro- look for genuine international colloboration in the ---- Executives nomic field and even for world pence would be indeed gloomy." guards seniority and other rights of workers on their previous jobs. (5) Utilizes, nationally and locally WAR If you should need copies of Important international dogu- cooperative labor & management efforts, plus Government. ments, write the State Department. Currently available, free, is a pamphlet called *War Documents," complete through June of 1944. Regraded Unclassit PRECISION TRADE MARA MICROSTAT 116 OIF. MICROFILM ROLL NO Administration's international legislative agendo the pretty colled FOR outlined the before Bretton Reads will submitted to Congress. Brand- As for Governmental Economic Stabilizer Vinnag limit Forthight completely Establishment just of n. United Nations food organisation, (2) wrote a DMW shipter in their history, with a stroke of Via peu, he *1ped out fort (1) Reciprecol Trade Agreement Act. (3) A new sulti-national morketing agree- all sar contracts and interial priorities of a Breaklyn Cire for failing Le ening the thrirs borriers. (4) Cortel control and orderly Bank. comply with a directive of the Notional Air Later Board, This 40 the first mint to reduce community surplusedy (B) Revision of the Export=Import be such case of its kind, ovizure Daving been the Government's normal resource, of (6) certain Repeal of the Johnsvo Act serring credits to certain nations (to par- "The better wethod." said Vincon, "Rould be a Comgressional not which would provide for penalties enforceable by the ludiciory tinlly accomplished by the Bretton Woods agreements: Note on the Federal Lown Agency from the Department or Commerce. Compli- the billose momination: The House passed, 399 to 2. the George bill Tinaco recently went 10 some point to anke clear that his office had "net" changed its policy on "frings" wage increasen. Such adjustments, said be, 14 divorce vare will the 6111 in a form Item: polotable The can be ande "only if they will not offect neversely our price stabilization cating and strengthening probobility of Wallnce's confirmation. program." There has been talk in Washington that OPA, through its industry to Em FOR, provides that and Government corporations must heneeforth be audited cost studies, holds ship hand on ango increnses---lenving WLB impotent to wike Finni vage decisions. WLS and Vinson are officially "conferring." by Un General Accounting office..... The regared nov reconversion plan The U.S. Department of Labor has an is as husti-bush as a military secret, Appendix to its useful "Guide to Labor though accounts have appeared in print. Legislation. It is 62 pages. loose- It is anid to have been undertaken by leaf. DENT is especially designed for supor- WPS on Byrnes' order, and allegedly is visors not when Order Latur not nearly so sweeping as plans prepared Dep't. Bulletin No. GG-A, from Sup't. of last summer by Donald Nelson. Documents, Woshington 25, D. C. Price 254. Key points of the plan-to-be center around an inter-agency *Progrum Readjust- The Nor Labor Board is no for behind with its 50000 that Chairman Was. H. Davis ment Committee* which would sin all outbacks. The spot authorization system has appealed to employers and unions to try to settle more disputed without would be more or less glorified, and reconversion would be on a semi-local turning to the Board. He especially urged that both parties get full Inform- basis with Agen Production Urgency Committees in control. Though WFB would tion on the national wage stabilization policy before acting. WLB is 20 weeks "review" mailtions outbacks, Army-Bovy would keep veto power over shifts to behind---with over 3,000 cases writing settlement. civilian production. Above resume is subject to change without notice--- since WPB officials are in coe of those "neither confirm nor deny* moods. Have made use of the "broin bank* at NPR's Mar Production Drive Headquar- ters? The Drive, currently going full blast under direction or No. F. Todd, Definite is the fact that the Aray has raised this year's output goal 18.95 has a pool of nome 10,000 production Ideas (devices and methods) ---planned over 1944 deliveries. Clear implication 11---03 WPB has said---reconversion to aid Inbor-manngement committees. For details, write Awards Branch, for at best will be slow. New stress is being laid on Puelfie requirements. Production Drive, WPB, Washington 25. D. c. TIP: A new manuel for contract sattle- The RP Drive has a considerable list of ment training progress is off the press. literature which It distributes, Free, to Title is: "Contract Settlement Training war Industry. One of the most helpful is Guide." It covern procedures for national a 27-page pomphlet, "Production Guide for and local training programs. and includes Labor-Manngement Committees.* It deals with information on Inventory and plant clearance, ways of handling production problems. Write accounting. and similar subjects. Order to Wor Production Drive, WPS, Washington. from Office of Contract Settlement. Federal Reserve Building. Weshington 25, D. c. Free. Metropolitan Life's Policyholders Service Bureau has published a detailed and enreful study colled "Re-employment of War Veterans." It 15 a companion piece The second angani report of the Director of Contract Settlement is biso avail- to "The Employment of the Handicapped Veteren" (DIGEST #80)---and is similarly able now. It's called, "War Contract Terminations and Settlements." Contents packed full of specific helps. Though primarily for Metropolitan Group policy- include recent regulations, and a summary of activities holders, free copies are nvnilable, by special arrangement with WAR DIGEST, from to date. You're likely to find it useful if you want the Nureou, at Doe Modison Avenue, New York 10, N. T. to get a comprehensive picture. Order na above. Free. SAVE COAL : WMC, opporantly mettled by recent share criticism of its manpower control program. is now checking employers to Executives see if they are complying with priority referrals, - THOMAS A. EDISON INCORPORATED, WEST ORANGE, N. J. ployment coilings, and other regulations. Said MeNutt DOCEST soothingly, *No...feel that we owe the duty to complying employers to bring the others into line." PRECISION TRADE MARK MICROSTAT/ No. s. PAIL OFF. MICROFILM ROLL NO. 249-8 249,A - 2 - Reading Copy I have come here to talk about an essential These last few weeks have been filled with segment of the peace program, prepared at another tremendous events. Besides the stirring news from conference of the United Nations held at Bretton Woods, the fighting fronts, we are beginning to see the New Hampshire, last summer. There, representatives outlines of the postwar world. A program for peace of 44 nations drew up agreements to establish an is taking shape before our eyes. International Monetary Fund and an International Following the general acceptance of the Bank for Reconstruction and Development. Dumbarton Oaks proposals we have had the great news I have been in close touch with every stage of the of the Yalta meeting and the increased Western Hemisphere unity portrayed at Mexico City. progress of these agreements, through two years of Now we look forward to the meeting which we hope preliminary work, through the conference itself and through the discussions since then. I can assure you may prove most fruitful, the conference of the that they are definitely good business for the United Nations in San Francisco next month. United States. 2789 **) 2640 250 1919 Regraded Unclassified RECISION TRADE MARK MICROSTAT/ MICROFILM ROLL NO. 249-D 249.C - 4 - - 3 - 1 Early in our discussions, we considered joining the They are more than that. functions of the Bank and the Fund in one establishment. Unless they are put into effect the strides toward We found good reasons for not doing that. I think you peace and security at Dumbarton Oaks, at Mexico City may want to know what these reasons were, now that and at Yalta, as well as the further steps that will the question has again been raised. be taken at San Francisco, may end only in frustration. The two deal with entirely different problems. Peace to be secure must rest on the firm foundation They will need staffs with entirely different training. of thriving industry within nations and profitable The Bank will be concerned exclusively with and expanding commerce between them. long-term investments for productive purposes - The Bretton Woods agreements deal with two great loans for twenty to thirty years, or even longer. Its problems. One is the problem of providing capital to staff will have to study the long-term debt positions repair the devastation of war and for development of various countries, their places in world trade, purposes. The other is the problem of establishing the worth of the project for which the loan is a system of fair monetary practices that will promote intended. The Bank will have only investment problems. trade instead of hindering it. The solution proposed is the creation of two institutions, the Fund and the Bank. 2163 Unclassified PRECISION TRADE MARK MICROSTAT/ PAT. OFF. MICROFILM ROLL NO. 249-F 249-E - 6 - - 5 - Long-term stabilization loans to a few countries would The Fund is not an investment institution at all. be a poor substitute for broad and constant cooperation It will be concerned exclusively with fluctuations in in meeting international currency problems. That can be the exchange markets, with seasonal and other factors secured only through B. Fund which is concerned exclusively affecting the exchanges. with bringing all countries together to work for currency Whether to join the Fund and the Bank in one stability. institution is not a question of form. It goes to The fundamental reason for monetary disorder after the last war was failure to understand the necessity for the very heart of the stabilization problem. Those international cooperation in dealing with this problem. who argue for one institution think of currency Each country was left to its own devices. Before 1922, stabilization as a matter of making loans. That 18 only 8 countries were on the gold standard. By 1928, not our conception of the problem at all. We think through real sacrifices, about 45 had made a precarious the issue goes much deeper. We believe the essential return to gold - some with the help of stabilization aspect of the Fund to be the setting of standards for loans. But the first serious pressure was too much for them. fair dealing in our money rates. Giving help to some countries to maintain the standards, once they are set, is incidental to the attainment of this main objective. 2313 Regraded Unclassified RECISION TRADE MARK MICROSTAT/ MICROFILM BOLL NO. 249-H I 249-G - 8 - - 7 - This 1s how it worked. In 1932, when every one found markets very scarce, Germany agreed for example The wolf pack of exchange speculators was on the prowl, seeking out weak currencies to destroy, and adding with some Balkan countries to buy most of their wheat and immeasurably to the difficulties of the countries raw materials at good prices in marks. But the Balkan which sought individually to maintain currency merchant did not get marks. These were paid into the 1/4 stability. One by one countries were forced off the Reichsbank. The Balkan countries then had to buy gold standard until by 1936 only 7 were left. The goods in Germany to get the value of those marks. world was back where it had started 14 years before. The Balkan importer paid into his central bank the But that doesn't tell the whole story. This was price of the German goods, and only then could the an era of economic warfare. The weapons were currency seller of the wheat or other raw material get his money. manipulation and other forms of discrimination. The aim of each country was to save itself at the expense As a matter of policy, Germany bought much and of others. The bilateral clearing agreement was the sold little. She was generally a year behind in most destructive of these weapons, because it was in fact meeting clearing obligations, and then frequently part of Germany's preparation for war. forced the Balkans to take articles they didn't need or want simply so they could pay their own exporters. Too often they got harmonicas and aspirin when they needed locomotives and dynamos. Regraded Unclassified PRECISION TRADE MARK MICROSTAT/ MICROFILM BOLL NO. - 10 - 249-J 249.1 - 9 - A country which runs into trouble will not have to act Through these agreements, Germany tied the alone. It will not need to use devices that spread economy of neighboring countries to the German war machine depression. It will be able to consult with others so that when she began her war she would have access to through the Fund and get help to maintain stability. raw materials. In self defense, other nations were Pause To sum up in simple terms: The Fund 1s a means of forced to adopt similar measures. getting countries to work with each other and not against A tangle of discrimination and preference spread each other on currency problems. The Fund sets standards over Europe, and even to the Western Hemisphere, to for foreign exchange practice and rules for fair dealing. the great cost of American exporters and the peace You can see that essentially this is not the tusiness of the world. By 1938 Germany alone had 36 bilateral of a lending agency. clearing agreements, Italy and Greece 28 each, Turkey 23 and so on. The only country in Europe that had Pause Now I would like to talk to you about the Bank. little none was Albania. There is the same contrast between foreign loan operations The Fund through international cooperation will under the Bank and those under the system in use before deal with the situation that led to this confusion. the war. In the past when countries needed foreign capital Each member country will define its currency in terms they too often had to give away some of their independence of gold and undertake to keep it stable. to get it. And they usually paid high interest rates in the bargain. Regraded Unclassified RECISION TRADE MARK MICROSTAT No. v. s. PAT. OFF. MICROFILM ROLL NO. 244-K - 11 - 249-1 - 12 - For instance, a great many of you will remember Kreuger and Toll. Frequently when a European country Many of them were squandered on projects which could was seeking foreign loans, Kreuger would turn up in never pay off. There was little or no supervision to the Finance Minister's office. He was glad to oblige make sure the money was spent for productive purposes. with quite a large loan. All he asked was the country's In too many cases there was little prospect that the match monopoly, and of course profitable rates, too. investor would get his money back. Kreuger then sold not only the bonds he took for the That was the system under which Americans used to loan, but in some instances forged duplicate sets of lend money abroad. By 1939, not counting the World War I them as well. Some of you in this audience may still loans, more than 40 cents of every dollar they had lent hold Kreuger and Toll Securities. You know what they to foreign countries since 1919 had gone into default. 1/2 are worth. The International Bank will make it possible for Kreuger was not the only operator in those days. countries to obtain capital for worth while, productive Undeveloped countries seeking foreign loans frequently projects. The Bank will guarantee loans for such secured from other sources loans that cost them too purposes so that they will be attractive to the private much and were often tainted with fraud. investor on reasonable terms. Unclassified PRECISION TRADE MARK MICROSTAT MICROFILM BOLL NO. 249-M 249- N - 13 - - 14 - And there will be no need for a country to give the And you can see that the Bank's business is lending, lender a match monopoly or a salt monopoly, or to pledge not monetary stabilization. its sovereignty in the form of an assignment of custom The Bretton Woods program offers currency stability revenues. There will be no need for these methods to facilitate trade, and credit protection for sound because the Bank will undertake loans only where the international loans. Both will benefit the American project is productive, only where the charges are fair, people through an increased and more stable market and only where the borrower can service the loan. for their products. There is urgent need for such productive investment. The experience of our generation has proved to us We cannot have a prompt restoration of the producing and that a well balanced prosperity for our country depends consuming power of the world while Europe lies in ruins on a vigorous foreign trade. Ten per cent of our jobs and great areas of the earth remain undeveloped. Pause in agriculture and industry depend directly upon To sum up in simple terms: The Bank is a cooperative international commerce. That was true in the high method of providing capital for productive purposes to employment years of 1929 and 1957, but the sharp decline countries that need capital for reconstruction and in foreign trade in 1932 had much to do with the severity development. Its purpose is to safeguard the interests of the depression. of the borrower and the investor. That's what the Bank 1132 is and what the Bank does. Regraded Unclassified PRECISION TRADE MARK MICROSTAT No. V. s. PAT. OFF. MICROFILM BOLL NO. 249-P 249-0 Pause - 15 - - 16 - Now let's see what discriminatory exchange The instability of foreign currencies was one of the regulations and fluctuating currency meant to the Twin chief reasons why No. 1 Dark Northern, which sold for Cities and the Northwest. Countries abroad found it $1.64 8. bushel in Minneapolis in May, 1928, brought impossible to buy your wheat and flour, and the same 49 cents in December, 1932. It helps explain why flour was true of exports of hardware and of machinery. sold here for $8.68 a barrel in May, 1928, and $4.02 in 3/4 November, 1932. No major commodity lost so large a part of its of course, the Bretton Woods agreements by themselves foreign market as wheat. In the years 1925-1928 the are not going to restore our foreign markets for wheat or United States exported $239 million worth a year, which anything else. But they are a necessary first step toward was 21 per cent of production. In 1931-34, the era of getting and keeping those markets for thousands of American exchange discrimination, this had fallen to $38 million, products. New exchange restrictions anywhere in the which was only 8 per cent of our production. world can close them. As a result, wheat growers were forced to dump their crops at any price. The farmer in the Red River Valley was being squeezed, as truly as if he had caught his hand in a threshing machine, by the exchange rates of the rupee and the yuan and the peso. PRECISION TRADE MARK MICROSTAT/ MICROFILM ROLL NO. 249-R 249 Q - 18 - - 17 - We have all seen it happen. Our exports of The Bretton Woods agreements are the expression of a commodities and of manufactured goods reached a high unanimous will on the part of the 4b United Nations point between the two wars, but in the 30's our to work together to that end. farmers and our manufacturers alike fought a losing and I wish it were possible to describe the manner hopeless battle to restore their export sales in the in which that will was expressed at Bretton Woods by face of depreciated currencies, quotas and other representatives of 44 nations covering the whole range barriers set up against us. The men thrown out of of the world in size, stage of indust Prelism, customs jobs because of this lost trade became very poor customers and economic conditions. They succeeded in shaping for all the products of American industry and agriculture. a thoroughly workmanlike program because they knew All these restrictions had much to do with intensifying that we must either create an orderly system now or and prolonging the great depression. sink back later into the chaos of individual expedients Pause To prevent this chain of disasters being repeated and devil-take-the-hindmost, They were animated by after this war 1s it not perfectly plain that the first the new international spirit. thing we need is a sincere desire on the part of all governments to work together to prevent them? Unclassified RECISION TRADE MARK MICROSTAT/ OFF. MICROFILM ROLL NO. 249-5 - 19 - 249-T - 20 - Let me give you perhaps the most dramatic example that occurred. In the list of subscriptions to the This is a symbol of her determination to cooperate Bank, Russia had been put down for $900 millions. wholeheartedly with us and the other United Nations This is a tremendous sum for a country whose richest in the task of reconstruction and development. area - bigger than any other country in Europe - has been The Bretton Woods agreements were conceived in ravaged with the utmost brutality by the Nazis. On the very practical spirit of cooperation. They the last day of the conference, after the subscriptions represent the first such set or resolutions presented were closed and all countries had agreed on the allocation to our people for achievement of the ideals for which of subscriptions, Russia announced that she would we are fighting. They can be an inspiration to all increase her subscription to twelve hundred million the other meetings of the United Nations and an example dollars. Russia assumed that additional $300 million obligation, not because there could be any direct advantage of how the most difficult problems can be overcome through mutual good will. to the Soviet Union, but in order to create a stronger Bank with a larger capital, able to contribute that much The legislation to carry out the Bretton Woods more to the rebuilding of the world. program 18 now before Congress. Regraded Unclassified RECISION TRADE MARK MICROSTAT/ RSG. u. 5. FAT. OFF. MICROFILM BOLL NO. 249- U 249 V - 22 - - 21 - At Bretton Woods, we set our hands to a very real Its approval will show that the United States is expression of our faith in the capacity of men to work thoroughly in earnest about joining with other nations together as partners in peace. I believe the American people are determined to achieve international security. for their part to do just that. Our generation has At Bretton Woods we proved that delegates from been given a new vision of the world. It is as though the governments of most of the world could meet together we were seeing the earth whole for the first time. and consider ways of helping each other. This 18 the Perhaps you remember how it was when you made your international spirit of the United Nations, the ideal first long airplane trip. Soaring over our country, for which Americans are dying today. It 18 our task at you got a new perspective of it, a new glimpse of its home to live for that ideal. magnificence and the interdependence of its people. It 18 because I feel deeply that the Bretton Woods And it might have been that as the plane flew in from the West, you were in darkness, but ahead you could agreements are so much a part of this new spirit, - see the dawn. se escential to its development, that I have been urging their acceptance. Tie are called upon in these times to express and to act upon our faith in mankind. Regraded Unclassified . 249 - W . 23 - We of the United Nations know that although the night is still all around us, we will come out into the light of a new day with its new opportunities for creating a better and safer world. 37 251 250 TREASURY DEPARTMENT Tachington 3 (The following address by Secretary Morgenthau off the 601d standard until by 1936 only seven were left. The before the Foreign Policy Association und the norld WEB back where it had started 14 years before. Minnespolis Civic and Comerce Association, nt Nicollet Hotel, Minneapolis, is scheduled for But that doesn't tell the whole story. This were an era delivery over Station WLOL of the Mutual Not- of economic warfare. The weapons were currency manipulation work at 9.45 P.M., EMT, Monday, March 12, 1245, und other forms of discrimination. The nim of ench country and is for release at that time. THE to gave itself at the expense of others. The bilateral clearing agreement was the most destructive of these wespons, heartise it ASS in fact part of Germany's preparation for war, These last few weeks have been filled with tremendous events. Beniden the stirring news from the fighting fronts, This 1a how it worked. In 1932, when every one found we are beginning to cee the outlines of the postmar world. markets very scarce, Germany agreed for example, with some A program for pende in taking shape before our eyes. Bulkan countries to buy nost of their whent and rair materials at good prices in marks. But the Balkan merchant did not get Pollowing the general acceptance of the Dumberton Onlen marks. Those were paid into the Reichsbonk. The Balkon proposale we have had the great tiens of the Yolto meeting countries then had to buy goods in Germany to get the value of and the increased Western Hemisphere unity portrayed at those sorks. The Inlkan importer poid into his central bank Mexico City, For THE look forward to the meeting which wir the yrice of the German goods, and only then could the seller hope my prove most fruitful, the conference of the United of the wheat or other raw material get his money. Nations in 8th Francisco next month. An a matter of policy, Germany hought much and sold I have como here to talk about on essential regnent of little. She won generally n. year behind in meeting clearing the peace program, prepared 01 another conferênce of the obligations, and then frequently forced the Balkson to take United Nations held at Relation Woods, Ten Hangwhire, last articles they didn't need or nent simply ao they could pay summer. There, representatives of 44 nations docum up their own exporters. Too often they got harmonions and agreements to outoblish en International Monetary Fund and ospirin when they needed locomotives and dynamos. an International Bank for Reconstruction and Development. Through these agreements, Germany tied the economy of I have been in close touch with every stage of the neighboring countries to the German var nachine so that when progress of there agreements, through two yours of prelimi- she began her war she would have access to run natarials. In mary work, through the conforence itself and shrough the salf defense, other nations nere forced to udopt similar discussions since then. I con assure you that they are measures. definitely good business for the United States. A tangle of discrimination and preference spread over They are more, than that, Durope, and evon to the Western Hemisphere, to the great nost of American exporters und the pesce of the world. By 1930 Unless they are put into effect the strides tonard peoce Termany alone had 36 bilatorol clearing agreements, Italy and and accurity at Dunbarton Ooks, at Mexico City and not Yelto, Greece 28 each, Turicay 23 and ao on. The only country in as well an the further steps that will be taken at San Burope that had none was Albenia. Pronoinco, my end only in frustration. Peace to be secure must rest on the firm foundation of thriving industry within The Fund through international cooperation will deal with nations und profitable and expanding commerce between Vhem. the situation that 1ed to this confusion. Each member country will define its currency in terms of gold and undertake to The Bretton Woods agreements deal with two great prob- Keep it stable. A country which runs into trouble will not lem. One in the problem of providing capital to repair have to ect slone. It will not need to use devices that the devistation of mr and for development purposes. The spreed depression. It will be able to consult with others other in the problem of establishing - system of intr through the Fund and get help to reintain stability. 45-44 PRECISION TRADE MARK MICROSTAT/ PAT. ON. MICROFILM ROLL NO. monetary practices that will promote trade inctead of hinder- ing it. The solution proposed is the creation of two Insti- tutions, the Fund and the Bank. Early in our discussions, we considered joining the functions of the Bank and the Fund To aum up in simple termar The Fund 10 a coons of getting In one establishment. We found good reasons for not doing countries to work with each other end not against soch other that, I think you may want to know what these reasons were, on currency problems. The Fund seto standards for exchange now that the question has again been rained. proctice and rules for fair dooling. You can nee that ceson- timily this in not the business of a lending agency. The two denl with entirely different problems. They will need staffe with entirely different training. Non I went to talk to you about the Bank. The Bank will be concerned exclusively with long-term There 1a the some contrast between foreign loan operations investments for productive purposes - loans for twenty to under the Bank and those under the system in use before the wor, thirty years, or even longer. Its staff will have to study In the post when countries needed foreign capital they too the long-term debt positions of various countries, their places often had to give eway none of their independence to get it. in world trade, the worth of the project for which the loan La And they usually paid high interest rates in the bargoin. Intended. The Bank will have only investment problems. The Fund 10 not an investment institution at all. It will For instance, = (Teat many of you will remember Frouger and Toll. Frequently When a European country THE seeking be concerned exclusively with fluctuations in the exchange foreign loons, Kreuger would turn up in the Finance Minister's markets, with sessonal and other factors effecting the exchanges. office. He NOD gind to obligo with quite a large loon. All he naiced was the country's mich monopoly, and of course prof- Whether to Join the Pund and the Bank In one institution itable reter, too. Kreuger then gold not only the bonds he is not a question of form. It goes to the very heart of the tank for the loan, but in some instences forged duplicate sate stabilization problem. Those who argue for one institution of then os well. Some of you in this sudience may still hold think of surrency stabilization as B matter of making loans. Krouger and Toll securities. You losew what they are north. That in not our conception of the problem at all, we think the Issue goes much deeper. Tie believe the essential aspect Krouger mad not the only operator in three days. Unde- of. the Fund to be the setting of standards for fair dealing veloped countries secking foreign loans frequently secured In our money retes. Giving help to none countries to maintain from other sources Loans that cost them too much and wore the standards once they are net 10 incidental to the attein- often trinted with froud. Many of then nere squandered on ment of this main objective. Long-term stabilization louns to projects which could never pay off. Phere was little or no a few countries would be 8. poor substitute for broad and con- supervision to nake sure the money WOU spent for productive stant cooperation in meeting international currency problems. surposes. In too many cases there not little prospect that That can be secured only through 6. Fund which 1a concerned the Investor would get his money back, exclusively with bringing all countries together to work for currency stobility. that me the system under which Americans used to Lund money abroad. By 1939, not counting the World War I loons, The fundsmental reason for monetery disorder after the aore than 40 conte of every dollar they had lent to foreign lest wor was failure to understand the necessity for inter- countries since 1919 had gona into default. national cooperation in dealing with this problem. Each country w.s.p left to its own devices. Before 1922, only eight The International Bank will mike it possible for coun- countries were on the gold standard. By 1028, through real trien to obtain capital for worth while, productive projects. secrifices, about 45 had made a precerious return to gold The Bank will guarantee louns for such purposes so that they some with the help of atabilization loans. But the first will be attractive to the private investor on reasonable serious pressure was too much for them. The solf pack of THESE. And there will be no need for II country to give the exchange speculators was on the prowl, seeking our week cur- lunder " match monopoly or a sult monopoly, 01" to pladge ita rencies to destroy, and adding immensurably to the diffi- sovereignty in the form of on assignment of cuptom revenues. culties of the countries which sought individually to main- There will be no need for those methods because the Bank will toin currency stability. One by one countries were forced undertyke loans only where the project 1n productive, only where the charges ere feir, and only where the borrower can service the loan. RECISION TRADE MARK MICROSTAT R$G, OFF. MICROFILM ROLL NO. 252 253 5 There is urgent need for such productive investment. We This is a synbol of her determination to cooperate whole- cannot have a prompt restoration of the producing and consum- heartedly with us and the other United Nations in the task Ing power of the world while Europe lice in ruins and great of reconstruction and development. areas of the earth romain undeveloped. The Bretton Woods agreements were conceived in the very To sun up in simple terms: The Bank is n cooperative practical spirit of cooperation. They represent the first method of providing copital for productive purposes to coun- much set of resolutions presented to our people for achieve- tries that need capital for reconstru ion and development. nent of the ideols for which no are fighting. They can be an Its purpose in to sufeguard the interests of the borrower and inspiration to all the other meetings of the United Notions the investor. That's what the Bank is and what the Dank dons. and en exemple of how the most difficult problems con be over- And you can 006 that the Bank's business in lending, not come through mutual good will. monetory stabilization. The legislation to carry out the Bretton Woodo program The Protton Woods program offers currency stability to 10 non before Congress. Its approval will show that the facilitate trade, and credit protection for sound intern- United States 1d thoroughly in cornect about joining with tional loans. Both will bonefit the American people through other nations to achieve international security. nn increased and more stable market for their products. At Bretton Woods we proved that delegates from the The experience of our generation has proveñ to un that 11 covernments of most of the world could meet together and con- well balanced prosperity for our country depends on Ti vigorous sider ways of helping each other. This is the international foreign trade. Ten percent of our jobs in agriculture and spirit of the United Nations, the ideal for which Americans industry dapend directly upon international conneros, That are dying today, It is our task at home to live for that was true in the high employment years of 1929 and 1937, but ideal. the sharp decline in foreign trode in 1932 had much to do with the severity of the depression. Non lot's noe which dinorini- It in because I feel deeply that the Bretton Toods agree- natory exchange regulations and fluctuating currency noant to penta are no much B part of this now spirit, are so essential the Twin Cities and the Northwest, Countries shrond found It to its development, that I have been urging their acceptance. imponsible to buy your whent und flour, and the pube vole true To 310 called upon in these times to express end to not upon of exports of hardware and of machinery. our faith in mankind. At Brotton Woods, we set our hands to a very rool expression of our faith in the copncity of nen to No mijor commodity lost so Inrge a part of Its foreign work together no partnern in peace. market on whent, In the years 1925-1928 the United States exported $239, 000, worth " year, which man 21 percent of I believe the American people are determined for their production. In 1931-34, the era of exchange discrimination, part to do just that. Our generation has been given n new this had follen to $38,000,000. which MGD only eight percent vision of the world. It 18 an though no were seeing the of our production. worth whole for the first time. Perhaps you remember how is was when you made your first long sirplane trip. Sooring over As D. result, wheat growers were forced to dump their our nountry, you got a new perspective of It, a new glimpse of crops at any price. The farmer in the Red River Valley ros ito magnificence and the interdependence of its people. And being squeered, 39 truly as if to had cought his hund in n It might have been that as the plane flew in from the West, throching enchine, by the exchange rates of the rupee and you were in darkness, but shend you could see the dawn. the yuan and the pego, The instability of foreign currencies WSS one of the chief reasons why No. 1 Dark Northern, which We of the United Sotions know that although the night is nold for 01.64 e bushel in Minnempolis in they, 1928, brought still all around us, ne will come out into the light of a new 49 conto in December, 1952. It helps explain any flour sold any with its new opportunities for creating a better and safer 1932. here for $0.68 is barrel in May, 1928, and 54.02 in November, world. «000» 6 or course, the Bretton Woods agreements by themselves are not going to restore our foreign markets for wheat or any- thing else, But they are a necessary first step toward getting end keeping those markets for thousands of American products. New exchange restrictions anywhere in the world onn close them. We have all seen it happen, Our exports of commodities and of manufactured goods reached a high point between the two ware, but in the 30's our forners and our manufacturers alike fought a losing and hopeless battle to restore their export sales in the face of depreciated currencies, quotes and other borriers set up against us. The men thrown out of jobs because of this lost trade became very poor customers for all the products of American industry and agriculture. All these restrictions had much to do with intensifying and prolonging the great depression. To prevent this chain of disasters being repented after this war is it not perfectly plain that the first thing we need 1a is sincere desire on the part of ell governments to work ther to prevent them? The Bretton Woods agreements are the expression of a unanimous will on the part of the 44 United Nations to work together to that end, I wish it were possible to describe the manner in which that will was expressed at Brotton Woods by representatives of 44 nations covering the whole range of the world in sine, stage of industrialism, customs and economic conditions. They succeeded in shaping a thoroughly workmanlike program because they knew that we must either create on orderly system now or sink back Inter into the choos of individual expedients and devil-take-the-hindmost. They were animated by the new inter- national spirit, Let ne give you perhaps the most dramatic exemple that occurred. In the list of subscriptions to the Bank, Russia had been put down for $900,000,000. This is a tremendous sum for a country whose richest area - bigger than any other country in Europe - has been ravaged with the utmost brutality by the Nazia. On the last day of the conference, after the subscriptions were closed and all countries had agreed on the allocation of subscriptions, Russia announced that she would increase her subscription to $1,200,000,000. Russia assumed that additional $300,000,000 obligation, not because there could be any direct advantage to the Soviet Union, but in order to create a stronger Denk with o lorger capital, able to contribute that much more to the rebuilding of the world. PRECISION TRADE MARK MICROSTAT/ REG. PAT. OFF, MICROFILM ROLL NO. March 13, 1945 Dear Mr. Murray: Let mo congratulate you upon the extremely helpful statement in behalf of the Hretton woods plan, contained In your letter to Chairman Spence of the house Banking Committee. I was especially impressed by your excellent summary In the sentence reading: "The opportunity is here to demonstrate to the world that the United States le ready and willing to play Its full part In securing the world stability and prosperity we must have to avert another crisis and a third world . war. It seems to me that such simply stated facts, hammered home again and again, must be our main reliance in winning support for Bretton Woods and for all phases of the world security program. We In the Treasury feel the Bretton Moods plan will stand up under the most searching analysis. Of course the average man and woman lacks the time and facilities for such analysis. The fundamental fact that everyone can grasp is a simple one: The United Nations must be partners In peace; the United States must be a full partner. I feel sure your Bretton Goods letter will not be the last blow you will strike for the cause. Let me repeat that I appreciate this timely help -- and would heartily welcome any further assistance. Sincerely, (Signed) H. Morgenthau, der Mr. Philip Murray President Congress of Industrial Organizations 718 Jackson Place, N.W. Washington 6, D.C. EBF/mah Regraded Unclassifie PRECISION TRADE MARK MICROSTAT NEG. OFF MICROFILM ROLI NO 2 It in our understanding that the Pretion Toods agreement will put on and to each practices. The the use of the International Monetary Pund proposed in the aprepment, world currencies can be hept stable, No coultry March 9, 1945 will be forced to drive loss the value of its own currency in order to give a fulse attendise to exporta. Quantities where currency my be under pressure cap apply to the fund hand secure support. In addition, the Tretton foods agreement provides 4 sound means of Monorable Brent Spende aiding In the reconstruction and development of the war devastated and otherwise House of Represenjatives industrially nations. This La done tign guaranteeing loans made for Tashington, D. C. constructive purposes through Ute Bank for Reconstruction and Development. The Bank, as - understand 11, vill beleharged with the careful investigation of Dear Congression Spence loans rade Fefore It will extend 11a guarantee. Thus, loans will not be made I an written to you to extiress the views of the Concerve of as In the pust to prop an shalty and unpopular Law, her for purely speculative Industrial Organizations on the panding legislation to Hillity the Pretiton and highly risky naturna which cannot be Subtitled by sound financial practice. Noods minitary and financial agreement. To do not. in the DID profess to be coarts in the intricacios of At your Comittee's convenience - would like to be able to International finance. That en Issve to the special specents who Inlored on present our views on the bill (MR 2211) In greater detail. the technical und of the agreement and to the acores of economists and leaking who have endorped it. The CIO, following the mandate of its ninbers expressed at the 1944 convention, Le in support of the bill to retify the Pretton Tooda The nealers of the JIO, and the millions of their relatives and agreement as It La now before your Committee. friends In the armed forces, believe fimily that - must have a planned and rational approach to world economic problems if - are to have security from This support 1a given In the fire belief that the agreement of MAZ and accountion after victory over the Axis in ackieved, the 44 United Nationa worked out at Pretton Woods last summer La the best guarantee of a greatly expanded and stabilized world trade that «ill afford The Bretton Toods Agreement represents a major step toward world protection to Acerican businessnen, markets to American farmers, and Jobs obonomic stability Ln the eyes of our members, They know that NO must export for American workers. n. sizable portion of our production in IPO are to maintain full production and joba for all after the MP, The nimbers of the CIO also understand that world The agreement La also a concrete demonstration of the fact that train elfinot bei . one way street; that in order to sell abroad we must have the United Nations, even before final victory over the Axis, can work out customers who are allo to buy from us and sell to us and to each other, successful solutions to their mutual problems in unity and accord. As such, the agreement is a tribute to the leaders of this nation and of all the Bretton Toods La the first opportunity that we in America have before United Nations. It 1a a long step in the direction of the collaboration of us to fill in the economic sections of the world security outline made at the the free nations which is the keystone of world peace and security. Crinea conference, at Dusbirton Onice and other United Nations meetings and conferences, The opportunity comeo at a time when we have concluded still As presented to Congress in its present form, the MII to reality another major agreement in the meeting of the American nations at Mexico City the Bretton Vooda agreement Le the first tool of our desire and ability to and as - for the United Nations conferunce in San Prancisco. cooperate with other countries in the prevention of future aggreasion and the maintenance of a stable peace. The opportunity is here to demonstrate to the world that the United States 10 ready and willing to play ito full part in securing the world The seeds of World Har II were laid in the world economic ortais Mar. stability and prosperity - must have to avart another crisis and a third World of the 20's and early 30's. The frantie race for an illusory trade advantage over other countries that expressed !toolf in deliberate currency manipulation, in the various systems of "blocked accounts" and other economic weapons no- At the same Une we have & chance to contribute greatly to our own sulted in the collapse of world trade and a consequent d-deprossion. businessmen to customers. prosperity, by helping our workers to jobs, our farmers to markets, and our In addition, such methods were used to Lapone economic domination by larger countries on smaller and weaker-ones, This you especially practised The members of the CIO believe that the Congress will take this by Nast Germany and Japan, and resulted in civing them an economic basis for opportunity to retifying the Bretton Woods agreement at an early date and aggression and war that they otherwise would not have possessed. without changes or assistments, No document or agreement is perfect nor 10 claimed to be. Brotton Woods, however, does represent the meeting of the Interests of haki United Nations, Including the United States and does protect Regraded Inclassified 3 ( the welfare of us all. Congress of Industrial Organizations that the Congress not quickly and wholeheartedly CIO greements as it has been presented in the bill now and Currency. 718 Jackson Place, N. W. Washington 6.D.C. arrica or Cordially yours, THE PRESIDENT Deputive me March 9, 1945 Philip Murray President The Honorable Henry Morgenthau, Jr. Secretary of the Treasury Washington, D. 0, Dear Secretary Norgenthau: In accordance with your telephone request of. this morning I so enclosing a. copy of the C.I.O. letter on Bretton Woode. Sincerely yours, Phyrip Eurray Enclosure PRECISION TRADE MARK MICROSTAT/ No. s. PAT. OHF. MICROFILM ROLL NO. 259 MAR 13 1945 Dear a. Rung: I use sorry to learn from your letter of March 6 that you have had to undergo another operation. I wish you a speedy recovery and hope that I may soon have the pleasure of seeing and talking with you. Thank you for your kind words about ay help to China. I have enjoyed being a sociated with you during these many years in maintaining the tradi- tionelly good relations between our countri B and in helping to defeat our enemica. There has never been any doubt In my mind--nor in yours 1 an sure-that this cooperation le what the peoples of both our two countries have wanted, and I as sure that after victory we will continue to work = together to keep the prace and achieve economic progress. Eve: though many important things oall for your attention, I hope you will take the time to rest prop- erly and make a complete recovery. If there is any- time I can do, please call upon no. 1th best wishes for your speedy recovery. Sincerely yours, (Signudi H. Murgenthau, Jr. Monorable B. H. Kunc, aldorf-Astoria Hotel, 50 and Pork Avenue, New York, New York. FC:ISF:r1 3/13/45 MICROSTAT ECUTIVE YUAN GOVERNMENT OF CHINA March 6,1945. Honorable Henry Morgenthau, Jr. Secretary of the Treasury Washington, D. 0, Dear Secretary Morgenthau: I such appreciate your letter of March a informing no that you have instructed your men to take up with the military authorities again the matter of shipping gold to China during the next few months. I an so glad that you have agreed with me on the seriousness of the situation in Ohina and the urgency of shipping gold there to combat inflation and that you pro- mise to do your utmost to assist us, After my operation to-morrow it will be necessary for no to have a. long convalescence before I have the pleasure of seeing you again. I wish to take this oppor- tunity to thank you for your good wishes and what you have done for China and your friendship for se, With kindest regards, Yours sincerely of H. .H. Kung PRECISION TRADE MARK MICROSTAT/ REG. U. 5. PAIL OFF. MICROFILM ROLL NO. 12" 261 March 13, 1945 Dear Mr. Keller: I have your letter of March 8, 1945, requesting that the Kunming operation contract be expedited. $ Information vas not received as to the estimated cost of the vork to be performed by Chrysler Export Corporation until March 10. The formal requisition from the Chinese Govern- sent has not as yet been received. In the meantime the contract is being put in final form. I can assure you that everything possible 10 being done to expedite its execution. Sincerely, (Signed) H. Morgentnau, Jr. Hr. K. T. Keller President, Chrysler Corporation Detroit 31, Michigan WGHelfrich:JWPehle:1hh 3-13-45 ---- MICROSTAT - MICROFILM ROLI no 12" CHRYSLER CORPORATION Detroit as Minkigan N.T. KELLER March 8, 1945 PRESIDENT Non. Renry Morganthau, Jr. Secretary of the Treasury Washington, D. C. Dear Secretary Morgenthaus I understand the Kunsing operation contract in all in agreement awaiting necessary approvals, including your own. Am informed it takes ten days to scoomplish this. We have e lot of things to do before we can start anybody on their way to China, most important of which is contracting the personnel. Re are very anxious to get along on this job, and anything you can do to expedite it will be greatly ap- preciated. Very truly yours, KTK-ow RECISION TRADE MARX MICROSTAT/ REG. U.S. PAT. OFF. MICROFILM ROLL NO. 12" 263 25 1046 Dear a. Brands This will acknowledge your letter of March 5, 1965 relating to financial problems in Italy. 1 would appreciate hearing further from Sir John Anderson et th reference to the ad- ministration of financial matters by the - bined allied authorities. It has been re- assuring to as that you strees the need for close cooperation to recencile our visus on Italian financial problems and I 43 enro that this close cooperation 1a being achieved. Sincerely, Signed it Jr. Mr. 1. & trand, Bax 680, United Kingdom Treasury Delegation, henjanda Franklin Station, Washington, D, c. Giver 3/10/45 Regraded Unclassified RECISION TRADE MARK MICROSTAT/ MICROFILM BOLL NO. of = Brought in by Mas Chauncey 3/7 264 RECISION TRADE MARE MICROSTAT us U.S. PAT. OII. MICROFILM NOU § I 2" - UNITED KINGDOM TREASURY DELEGATION BoxBae BENJAMIN FRANKLIN STATION WASHINGTON, D.O. REFERENCE March 5, 1945. TELEPHONE EXECUTIVE .... PERSONAL Dear Mr. Secretary: In accordance with your request I communicated to the Chancellor of the Exchequer your views on the italian situation, and particularly your anxiety so to certain coments which had been made to you on the policy of "purging" being pursued by the Combined Allied authorities in Italy. I have had a reply from Sir John Anderson saying that be is looking into the matter and hopes to communicate his views to se soon. I an very sorry Mr. Glasser could not be spared to go to Italy, though I fully understand the present strain on your Treasury officials. I thought his visit, together with a similar visit of a U.K. Treasury official, might help both Treasuries to see age to eye on Italian financial problems. I know the U.K. Treasury are most anxious that this result should somebow be achieved by as close co-operation as is possible. Yours sincerely, The Honourable Henry Morgenthau, Jr., Secretary of the Treasury, Washingtony D.C. CERTIFICATE OF AUTHENTICITY OPERATOR: Schwars ROLL NO. / TIME START: 515PM TIME FINISH: 7pm DATE: 1/29/47 DEPT.: SPECIAL FEATURE OF COPY: peate'B' Diary Diary " # of 824 825 March March 3-6 1-2 1945 1945 " * # 826 March 7-9 1945 A. - 827-1 March 100/2 1945 A 4 # 827-2 March 13 1445 Pgo145 to Pg. 265 Cont. in nextpace # 2 (Photootat copies notpharps legitle) I hereby certify as follows: 1. I em a microlin operator employed by MICROFILM CORPORATION. 2. E made accuren and complex arproductions of the records as rebeited by for microfilming on the date or dates above mmxiceed. (Company Name and Address) 3. That listed above a the rell number and the records which it consins. 4. The if any pictures have # such punched through the eige of the frame, they have been crukes, and such main will appear anached to the beginning of this mil, and will be proceded by # corrificate emiled Certificate of Authoricity (leuin): if any pictures have . hole punched drough the lower leh hand corner of the frame, the picture is # deplicate and should be disregarded. 3. That uf these are any significant form of the records microbled on this roll, they will be described in my handwriting in the above space labelled: Special Form. 6, The mid microbining via performed persuant - and in conformance with Contract Segiement An of 1944, Seca. 4 (b) and 19 (4) shareof and seconding 60 Regulation 11, Sees. 8013.1 to 8015.9 indusive, made the Dyrector of Commit Sentement or any amend- pero of additional regulations thermo. Name of Opmater