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Volume 722, April 8 – April 19, 1944
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Volume 722, April 8 – April 19, 1944
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Henry Morgenthau, Jr. Papers
Diaries of Henry Morgenthau, Jr.
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Diary
Book 722
April 17-19, 1944
Regraded Unclassified
- À -
Book Page
Appointments and Resignations
Budget Officer, Treasury: Discussed by HMJr. D.W. Bell,
and C.S. Bell - 4/19/44
722 309
a) Separation of Administrative Assistant and
Budget Officer recommended by D.W. Bell;
Schoeneman (Charles J.) suggested for Budget
Officer
Argentina
See Latin America
Automobiles
See Procurement Division: Surplus Property, Disposal of
Banco Espanol de Paris
- B - -
See Spain
Bell, Charles S.
See Deferments, Military
Brazil
See Post-War Planning: Currency Stabilization
Budget Officer, Treasury
See Appointments and Resignations
Business Conditions
Haas memorandum on situation, week ending
April 15, 1944 - 4/17/44
117
- C -
Cables
See War Refugee Board
Canada
See Post-War Planning: Currency Stabilization
China
See also Post-War Planning: Currency Stabilization
Ministry of Finance replies formally as to its attitude
regarding appropriate procedure for remittances to
occupied areas - 4/19/44
372
Costa Rica
See Post-War Planning: Currency Stabilization
Currency Stabilization
See Post-War Planning
- D - -
Deferments, Military
Bell, Charles S.: Appointed member of Treasury Committee -
4/17/44
114,115
Dexter, Robert C.
See War Refugee Board: Portugal
Doyle, Mrs. Henry Grattan
See Employee Relations, Treasury
- E -
Book Page
Employee Relations, Treasury
Doyle, Mrs. Henry Grattan: Six months resume of work
accomplished - 4/17/44
722
109
Ezekiel, Mordecai
See Post-War Planning
- y -
Financing, Government
War Savings Bonds
5th War Loan Drive
Basket of securities approved by FDR - 4/18/44
198,202
National City Bank sends advertising blotter -
4/18/44
203
Kaye, Danny: HMJr's memorandum to Gamble concerning -
4/18/44
206
Patman, Wright (Congressman, Texas) : Asks HMJr to
open drive in the Southwest - 4/18/44
209
Conference: present: HMJr, Gamble, and Smith -
4/19/44
284
a) Texarkana opening discussed
1) Patman advises against Sunday speech:
See Book 723, page 134
2) Patman-HMJr conversation - 4/21/44:
Book 723, page 184
b) Swope, Herbert Bayard, as adviser on 5th loan
suggested by HMJr
287
c) Los Angeles appearance also discussed
289
d) Detroit appearance with top management and
labor people discussed
292
e) Slogans discussed
295
f) Anti-Nazi war prisoner - - participation
discussed
298
1) HMJr-Greenbaum conversation - 4/20/44:
Book 723, page 39
- I -
India
Finance member of Viceroy's Executive Council
Sir Jeremy Raisman to visit United States - 4/19/44
374
- X -
Kaye, Danny
See Financing, Government: War Savings Bonds
(5th War Loan Drive)
Regraded Unclassified
- L -
Book Page
Latin America
Argentina
Resumé of State-Treasury negotiations on freezing -
O'Connell memorandum - 4/19/44
722 337
Wallace-HMJr conversation - 4/27/44: See Book 724,
page 239
Conference: present: HMJr and Luxford - 4/27/44:
Book 724, page 244
a) Telephone talk with Hull rather than formal
letter discussed
b) Crowley-HMJr conversation: Book 724, page 251
c) Acheson-HMJr
If
If
#
pages 256,279
d) Hull letter (proposed): Book 724, page 268
(Brazil
(Costa Rica
(Mexico
See Post-War Planning (Currency Stabilization)
Lend-Lease
Weekly report - 4/18/44
228
United Kingdom
Aircraft despatched, weeks ending March 21, March 31, and
April 7 - British Air Commission report - 4/17/44
128
Chancellor of Exchequer-Stettinius conference reported -
4/19/44
338-A
Loeb, John
See Procurement Division: Surplus Property, Disposal of
- M -
McQuillan, Mr. (Internal Revenue Intelligence, New York City)
Employment of Nazi sympathizer discussed by HMJr with
Treasury group - 4/17/44
3
(See also Book 726, page 18 - 5/1/44)
Mexico
See Post-War Planning: Currency Stabilization
- N -
National City Bank
See Financing, Government: War Savings Bonds
(5th War Loan Drive)
- P -
Patman, Wright (Congressman, Texas)
See Financing, Government: War Savings Bonds
(5th War Loan Drive)
Portugal
See War Refugee Board
Regraded Unclassified
- P - (Continued)
Book Page
Post-War Planning
Currency Stabilization
International Conference
See also Book 717
HMJr's appearance before Congressional Committees
discussed by HMJr, White, Luxford, Bernstein,
and Smith; O'Connell later - 4/17/44
722
3,81,311
a) Senator Berkley-O'Connell conversation
reported
70
Appearance approved by FDR - 4/19/44
322
Schedule of appearances: See Book 723, page 41
Drafts of statement: Book 723, page 49, etc.
Reading copy - 4/21/44: Book 723, page 205
Joint statement: Book 723, page 224
Winant told HMJr will head delegation; asked if
he thinks Great Britain will choose chief financial
officer to head theirs: Book 723, pages 177,178
U.S.S.R.
Cable to American Embassy, Moscow, asking about
participation - 4/17/44
48
United States Ambassador given resumé of plans
to date - 4/17/44
165
American Embassy, Moscow, urged to ascertain
attitude toward conference - 4/19/44
375
Conference; present: HMJr, White, and Luxford -
4/20/44: Book 723, page 1
a) Harriman-HMJr conversation: Book 723, page 11
b) HMJr-Russian Embassy conversation: Book 723,
page 18
c) Molotov-Harriman conversation reported in
cable: Book 723, page 37
d) Harriman reports answer is now "yes" -
4/21/44: Book 723, page 189
1) HMJr asks State to see cable:
Book 723, pages 192,203
Russian Ambassador-HMJr conversation - 4/21/44:
Book 723, page 200
Harriman thanked for assistance - 4/21/44: Book 723,
page 301
People's Commissar for Finance reply - 4/26/44:
Book 724, page 181
American Embassy reports "no answer" as yet -
5/1/44: Book 726, page 127
Conference; present: HMJr, White, Luxford, Bernetein,
and Smith - 4/17/44
3
a) British reply considered
16
b) Hull-HMJr conversation
20
1) Pasvolsky's opposition to Bank
(too late to stop Fund) apparent
28
Acheson-HMJr conversation concerning State-Treasury
meeting - 4/17/44
57
a) Agenda for meeting
94
Great Britain:
Winant told of impending visit to Congress -
4/17/44
92
Winant told of plans for joint statement
170
- P - (Continued)
Book Page
Post-War Planning (Continued)
Currency Stabilization (Continued)
International Conference (Continued)
China: Ambassador and Adler given resumé of plane
to date - 4/17/44
722
160
Conference; present: HMJr and Treasury group: Jones:
Crowley and Cox; Currie: Acheson, Collado, and
Pasvolsky (State); Eccles, Goldenweiser, and
Gardner (Federal Reserve) - 4/18/44
179
Conference of State and Treasury only - 4/18/44
194
a) FDR: Telegram to
198
Congressional representation in U.S. group of
delegates discussed in O'Connell memorandum -
4/18/44
222
Brazil, Mexico, Costa Rica, and Canada given
up-to-date resume of present proposals and told
of HMJr's impending appearance before Congress -
4/18/44
267,271,
275,370
India: Finance member of Viceroy's Executive Council,
Sir Jeremy Raisman, cannot be in United States for
conference - 4/19/44
374
Ezekiel, Mordecai: Draft of proposed statement by
England, U.S.S.R., and United States "to the peoples
enslaved by dictators" - 4/18/44
216
a) Revised draft - 4/24/44: See Book 724, page 32
Procurement Division
Surplus Property, Disposal of
Loeb, John: Letter of criticism to HMJr discussed by
HMJr and Mack - 4/17/44
75
a) Memorandum
79
Automobiles
Mack told by HMJr that Reconstruction Finance
Corporation's 8- or 900 care are to be pooled with
Treasury's and disposed of to non-tax-supported
organizations or individuals - 4/19/44
282
a) Mack memorandum after conference with
Reconstruction Finance Corporation
283
Illinois given 50 because of flood conditions -
4/29/44: See Book 725, page 140
- R -
Revenue Revision
Ickes' suggestion to take tax situation to the people
discussed in White House-Ickes-Treasury correspondence -
4/17/44
103
Tax Court of the United States: Justice to represent
Treasury in re renegotiation under Title VII of 1943
Revenue Act - 4/17/44
107
- S - -
Book Page
Schoeneman, Charles J.
See Appointments and Resignations: Budget Officer, Treasury
Scovell, Robert J.
See War Refugee Board: U.S.S.R.
Slogans
See Financing, Government: War Savings Bonds
*
(5th War Loan Drive)
Sweden
See War Refugee Board
Swope, Herbert Bayard
See Financing. Government: War Savings Bonds
(5th War Loan Drive)
- T - T -
Tax Court of the United States
See Revenue Revision
Taylor, Myron C.
See War Refugee Board
Texarkana
See Financing, Government: War Savings Bonds
(5th War Loan Drive)
Turkey
See War Refugee Board
i
- U - U -
U.S.S.R.
See Post-War Planning: Currency Stabilization
. War Refugee Board
United Kingdom
See Lend-Lease
If Post-War Planning: Currency Stabilization
II War Refugee Board
- W - -
War Refugee Board
Portugal: Dexter, Robert C., appointed Special
Representative in Lisbon - 4/17/44
722 135
U.S.S.R.: Harriman told of proposal to appoint
Scovell, Robert J., Special Representative in Moscow -
4/17/44
157
a) Harriman disapproves - 4/24/44: See Book 724,
page 96
Taylor (Myron C.)-HMJr discuss conference between
Sir Herbert Emerson and Pehle - 4/18/44
212
Yugoslavia: Tito's cooperation to be sought - cable
from American Minister, Cairo - 4/18/44
235
England: Special Representative in London discussed in
cable to Winant - 4/18/44
242
244
a) Winant's reply
*
Spain: Bauro Expansl en Paris. history of - 4/17/44
149-A
- W - (Continued)
Book Page
War Refugee Board (Continued)
Sweden: Publicity given FDR's statement discussed in
cable from American Embassy, Stockholm - 4/18/44
722 256
Cables: State Department improvement in timing noted
in Pehle memorandum - 4/19/44
341
Turkey: Hirschmann accomplishments reported to FDR -
4/19/44
343
- Y -
Yugoslavia
See War Refugee Board
1
EXTRA CONFIDENTIAL
April 17, 1944
At nine-thirty Sunday night, after reading 2. so-called "type
of speech Wendle Willkie could make on our Argentine Policy", I
called up Luxford and told him that I think that we ought to go
ahead and write a letter to Hull that we want him to freeze the
Argentine assets. I said that we could tell him that we are
encouraged by the strong position that the State Department took
vis-a-vis Sweden on ball bearings, on which, as I understand it,
they seked the British to go along and the British wouldn't 6°
along, so we said we'd do it anyway and then the British got on
the band-wagon; and that we should compliment the State Department
on this and say that we are encouraged and therefore we are
approaching them on freezing. Luxford said he didn't think we'd
have any trouble getting the Argentine, now, to freeze.
He said in talking to Lauch Currie the other, that Lauch
Currie said that if he was going to pick one man in the whole
Administration to support him in a fight, he'd pick me. He said
that was a nice compliment.
Luxford said that it was wonderful about the cable that
came through from the Chancellor of the Exchequer to me Sunday.
I heard about it at seven-thirty when I called White. He said
if during my occupancy of the office of Secretary of the Treasury,
I could acquire international stabilization, he thought it would
be the greatest achievment of any Secretary of the Treasury could
accomplish. I agreed with him. I told Luxford at nine-forty-five
that they were to do nothing on the Argentine that might get the
English upset until after we get agreement out of the English on
Regraded Unclassified
2
- 2 -
the World Stabilization Conference. And he said he agreed with
me entirely. I said, after all, it will only be a matter of
three or four days and it's been a year and a half, so we can
wait another three or four days hoping that we will get an
agreement out of the English. Luxford was in entire agreement
with me.
3
April 17, 1944
9:50 a.m.
INTERNATIONAL STABILIZATION FUND
Present: Mr. White
Mr. Luxford
Mr. Bernstein
Mr. Smith
H.M.JR: While I am thinking about it, I left up at
the house this report which Gaston sent me on an investi-
gation of a girl who is supposed to be pro-German. I
tried to read it and couldn't, because the thing is
typed so badly, you see. I would like you to read it
and digest it.
One of the things that I would like to know most
is - she works for McQuillan - is McQuillan satisfied
to have a girl like that work for him? There is no
question - I read enough of it - that the girl went to
Germany with Fritz Kuhn in 1936 and came back wearing a
swastika pin and telling everybody how she feels about
Hitler, and everything else.
Now, why does McQuillan take a girl like that?
That interests me more than the girl.
MR. O'CONNELL: He must have just taken her without
making an investigation that disclosed that.
H.M.JR: I still want to know how long he has known
all this. Has he protested? Has he been satisfied?
Now, McQuillan is in a key post, and it is much more
important to me to find out what is McQuillan's attitude
toward a girl like this, than about & little cierk. He
is Internal Revenue Intelligence of New York; it is a
key position.
4
- 2 -
MR. O'CONNELL: Yes.
H.M.JR: This thing has been hanging fire for six
months, and as near as I can make out, Chapman
straddles the fence on this. He is on the Committee.
The only fellow who seems to take a strong position
is the representative of the Federal Reserve.
MR. O'CONNELL: He took the strong position of get-
ting rid of her?
H.M.JR: Yes.
MR. WHITE: I would very much like to read it if
it is available.
H.M.JR: I think you will save your eyes by having
the thing re-typed. Why they send me fourth ribbon copy!
Now, you men who have tbeen living with this thing -
is it time for me to go up on the Hill?
MR. WHITE: Yes, I would say that is the very first
thing to be done - to make arrangements to go on the
Hill. We don't have much choice in the time. It has to
be Thursday afternoon.
I would like Fred Smith to come in here at this
point.
H.M.JR: I meant to have him sit in on the whole
thing.
(The Secretary sends for Mr. Fred Smith)
MR. WHITE: It is a question of leaks, and so forth.
H.M.JR: I can't do more than one in the afternoon
and one in the morning. I said that before.
MR. O'CONNELL: You can't do them except one in the
morning and one in the afternoon?
Regraded Unclassified
5
- 3 -
H.M.JR: I can't do two. Let's say whichever one
you go to, it means going up there at ten and being there
two hours. You adjourn and you come back. The other
group says, "We will see you at three or four." That is
the way it will work out in practice.
MR. WHITE: You can see two a day?
H.M.JR: Yes, but not two in the afternoon.
MR. WHITE: Then the Penate better be first.
MR. O'CONNELL: See the Senate first and make a deal
with them which you hope would keep them quiet.
H.M.JR: I can't do it by two in the afternoon.
It is a physical impossibility.
MR. WHITE: Then I think the Senate would have to
be first.
H.M.JR: You can't stand it any better than I can,
Harry, physically.
MR. WHITE: I wasn't thinking of that at all.
H.M.JR: I am. I am thinking of the physical part.
To suit their convenience one will say, "All right, ten
o'clock." Then they all meet at twelve. The other will
say, "All right, you come up around three or four.
MR. O'CONNELL: I think we ought to shoot for the
Senate at ten, say, which would be ten-thirty before
you got started, and the House at two or two-thirty.
Isn't that about what you would want in the way of timing?
(Mr. Smith enters the conference)
H.M.JR: I think the Senate in the morning - it
doesn't make much difference, but you have to give the
Senate the preference.
Regraded Unclassified
6
- 4 -
MR. O'CONNELL: We will ask for ten for the Senate
and two-thirty for the House.
H.M.JR: That is all right.
MR. WHITE: Then we need & press conference as
soon as Fred thinks we can have it and be safe, because
you have to have a press conference before Friday so
they will have a good story on Friday.
H.M.JR: We can have a press conference after the
Hill.
MR. LUXFORD: Can you get a good story on Friday
if you have it late in the afternoon on Thursday?
MR. SMITH: Sure. You have the Friday morning papers.
MR. WHITE: How late could you have a press conference
and still function?
MR. SMITH: Oh, it would have to end up before six
clock.
MR. WHITE: That is all right.
H.M.JR: It wouldn't be bad ball to have it in
between.
MR. WHITE: We might have them in at two for some of
the technical questions.
MR. BERNSTEIN: No.
MR. O'CONNELL: We had better ask for two for the
House - the closer to two you get it--
MR. WHITE: You need a little time between the
morning session and--
MR. O'CONNELL: You can count on the morning session
being over by noon. Is that all right?
Regraded Unclassified
7
- 5 -
H.M.JR: The ideal time would be two-thirty.
MR. O'CONNELL: I thought you might stretch out.
It would be a little harder to meet the deadline which
Fred has just indicated for the purpose of Friday morning
stories.
H.M.JR: Well, look, I will give you some leeway.
See what they want.
The most important thing, I think, other than the
press is this: I think that if these Chairmen who
meet the Democrats in the Senate and in the House, if we
could have a meeting with them, maybe Wednesday morning -
the Chairmen in the Senate and the House - and they could
be asked to meet together - and Wednesday morning go over
this thing with them in advance 80 they would know and
help us out on the questions. I think it is terribly im-
portant that you don't go in to them cold.
MR. WHITE: You mean the Chairmen of the various
Committees?
H.M.JR: Yes. Ask them if we could meet with them
Wednesday morning somewhere off the record and put them
through school so they would know what it was about.
Take Bloom - if he knows what it is about, he could help
us a lot.
MR. LUXFORD: That has & further advantage, too,
Mr. Secretary, in that they can perhaps prepare a little
statement they will want to make to the press to supplement
yours, and you will get a double play on it.
H.M.JR: A lot of reasons why that should be done
Wednesday morning.
And the other suggestion I have on technique - I
told somebody - - I don't know whether they forgot it -
that is, I threw it out - I don't know what arrangements
Hull has made on the Hill. He has made some arrangements.
Regraded Unclassified
8
- 6 -
MR. WHITE: You made it, and I did forget it. You
asked me what people did they have present at the con-
ference.
H.M.JR: And I said I wanted to do at least as well.
MR. WHITE: I have a partial alibi - it relates to
the conference and not to this hearing.
H.M.JR: The point I want to be able to do - I don't
know - Hull has made some arrangement in criticizing them
this morning; but at least I want to do as well, and I
want to know what technique Hull has used.
MR. O'CONNELL: You mean as to Congressional partici-
pation?
H.M.JR: In a conference.
MR. WHITE: we were waiting until there was a
decision on the conference.
MR. SMITH: Wasn't that in the papers yesterday?
H.M.JR: I want to get Hull's side of it.
MR. O'CONNELL: I think a couple of fellows were
working on it over the week end. It is background
material. It won't he ready until the end of the day, as
to what the State Department has done and what the general
position has been, and how they have handled it, and so
forth.
H.M.JR: Harry's suggestion?
MR. WHITE: No, but we had talked about it.
MR. SMITH: As a matter of fact, you told Joe to do
it, because I was here and I remember. Harry, you are
out of it.
9
- 7 -
MR. WHITE: No, we talked about this last week. I
didn't tell him to do it over the week end.
MR. O'CONNELL: I was--
MR. WHITE: What do you propose to tell them about
the meeting?
MR. O'CONNELL: I could tell them only in the vaguest
terms unless you give me a little more of the definite
idea.
MR. WHITE: I suppose you might say that there has
been substantial and important progress made in the dis-
cussions on monetary matters and Secretary Morgenthau
wants to--
MR. O'CONNELL: I would like to be able to indicate
this is an important meeting rather than just a progress
report.
H.M.JR: May I suggest this, I think it is always
better to take these fellows in a conference. Tell them-
we have been working like hell to get an agreement and
the agreement is just always over the horizon, and we have
told both the English and Russians that I was going up
on the Hill on Thursday and hoped that that would bring
them into line. We have got a pretty good chance, but
this has been going on since the last meeting of October -
was it?
MR. WHITE: No, no.
H.M.JR: When was I up on the Hill last?
MR. WHITE: I don't remember exactly. It was in the
fall.
H.M.JR: It could be found out. It is not & secret,
when I was last on the Hill. And a lot of work has been
done and we are hoping that we will be able to tell them.
Regraded Unclassified
10
- 8 -
If we can tell them that the English and Russians
have agreed, that is important; if they haven't agreed,
that is important, anyhow. But we have had to tell these
people that this is the deadline, and then I would go a
step further. I think it is much better to be frank
and tell them the thing about Congressman Dewey - that
Congressman Dewey has & bill which is almost like ours
but not quite which they want to put the Republican label
on. I have to appear there next week and therefore we
felt that while we are not trying to play politics,
we want to keep them from playing politics. "This is to be
non-partisan, and so forth and 80 on. But they are try-
ing to play politics, therefore it is important that I
come up this week instead of next week to be on the de-
fensive.
Here we have a positive program which we think is &
good one, and we have a fairly good chance - but the
reason this week rather than next week is to keep the
Republicans from stealing the show and putting the Adminis-
tration on the defensive. "Therefore, win or lose, it is
important that we come up there" - and they love this
thing from the standpoint of the Democratic Party. I
have used that the last month or two and they love it.
"From the standpoint of the Democratic Party, it is im-
portant that we come up and make a good showing" - be-
cause on the international front, here is something
positive they can put their teeth into. This is good for
the businessman, you see. This is going to help business
get off to a quick start after the Armistice, and put
men back to work, re-employ soldiers and workmen, because
factories can start up, because the great risk of how
they are going to get paid will be eliminated. This is
good for the middle class of America, see?
Now, Harry can add or subtract, and even Mr. Bernstein
and Mr. Luxford will be permitted to do the same, and
Mr. Smith. How do you like that kind of talk?
MR. WHITE: That is first-rate. I think I might add
this, that we have practically - use the word "practically" -
all the countries agreeing except Britain and Russia, and
Regraded Unclassified
11
- 9 -
the chances are good that we will hear from them before -
in other words, China has agreed - practically all the
countries.
H.M.JR: And they love to be in on the inside. You
can tell them this, that we surmise that one of the things
that is holding us up was Montague Norman, which is the
old fight of the Central Banks controiled by the private
banks against the Government. Now Montague Norman is out,
and the thing has seemed to take & turn for the better.
Montague Norman's motto was "no explanation, no apologies."
That was his motto.
This is just a surmise - because of his going out
and Lord Catto's coming in, things seem to take a turn
for the better. We know this is & fact, that this thing
has been held up. This has been 8. fight, the old Central
Bank, the old business crowd, do you see? It is the same
fight there that is here, and when the Democratic Party
moved the thing here to Washington - and you can even
say there is & little feeling they don't want the thing
in Washington, but in London -"so this is to nail down the
accomplishments of twelve years for the people."
MR. WHITE: Is this to be said just to the Chairmen
of all the committees, or just the House and Senate?
H.M. JR: Whoever Joe sees. I am telling you in a
little flip manner, but it happens to be dead in earnest.
MR. WHITE: Would it be possible to have those two
men to lunch and tell them that yourself?
H.M.JR: No. Look, Harry, they don't like lunch.
Lunch is a bad time and the bell rings. They don't
like it. I have tried it. It is much better to say
to these people, "We will meet either in the Speaker's
room, or over in Colonel Halsey's room, or any place that
you say where we are not apt to be seen." If we meet in
the Capitol we are apt to be seen - but some place that
they suggest. If we could meet Wednesday morning, bright
and early - meet here, meet at my home - any place that
12
- 10 -
they say, 80 we could have a dress rehearsal on this
thing.
From the standpoint of the Democratic Party, this is
a very important accomplishment, something they can use
and talk about and put their teeth into; because, after
all, after the Armistice, the first thing we think we
need to resume international business is currency stabili-
zation, foreign exchange stabilization. If you have a
stable thing there, then the fellow can begin to ship and
do business; if you don't he just doesn't know how he is
going to get paid. Before they can start resuming busi-
ness after the Armistice, this is the first thing that
you need.
MR. WHITE: Mr. Wallace has said this was the one
bright thing on the economic horizon. That was his own
judgment. we didn't discuss it. I don't quite under-
stand - is he to tell them this, or are you?
H.M.JR: Look, Harry, Mr. 'Conneil, my General
Counsel, says he doesn't know much about it. I am trying
to give it to him 80 he knows how I am feeling.
Has anybody told you this kind of stuff?
MR. 0' "CONNELL: No.
H.M.JR: It is new and it is good?
MR. O'CONNELL: It is all right. Às I visualize it,
I could--
H.M.JR: And I am trusting to use what he has. You
have to know something.
MR. WHITE: But I don't understand whether he is
going to make an arrangement for you to see the leaders
up there, or whether the meeting you referred to was the
meeting of the Chairmen of all the Committees.
MR. O'CONNELL: He was speaking of the Chairmen of
the Committees.
Regraded Unclassified
13
- 11 -
H.M. JR: The Chairmen of the Committees.
MR. O'CONNELL: I thought I would start with Barkley.
H.M.JR: If Sam Rayburn wants to attend - and Barkley
is very sensitive--
MR. O'CONNELL: I thought I would start with Barkley
in the Senate and Rayburn in the House and lay the cards
on the table along the lines you have indicated, and ask
the ir help in arranging for the Chairmen of the Committees
to call their Committees together for Thursday, and for
them to meet with the Secretary on wednesday morning at
a place that would be mutually satisfactory, where it would
be completely off the record. But I would start with
Barkley and Rayburn.
H.M.JR: That is right. And if Barkley and Rayburn
could be present at those meetings; and in the House, if
McCormack could be present, too, at the Wednesday meeting--
MR. O'CONNELL: Now, McCormack is Barkley's opposite
number in the House. I don't know why we have all assumed
it should be Rayburn rather than McCormack.
H.M.JR: It should be Rayburn. The organization is
different.
MR. O'CONNELL: I would prefer to approach Rayburn
and it would be up to him.
H.M.JR: Rayburn is terribly fast. Say, "Here are
the facts; please tell them how to proceed" - to Rayburn.
MR. LUXFORD: Mr. Secretary, developing your
political arguments, I wonder--
H.M.JR: Excuse me. Did you think I knew as much
about it, Harry, as I did?
MR. WHITE: I liked the statement. It isn't strictly
accurate, but so much the better.
Regraded Unclassified
14
- 12 -
H.M.JR: What isn't accurate?
MR. WHITE: Never mind. It is 8. good statement.
H.M.JR: Listen, it is a statement to win, isn't it?
MR. WHITE: That is why it is a good statement.
H.M.JR: It is a campaign document; I am saying this,
also, that somebody in the room who is going to write it could
get the spirit I want to carry out. Isn't this thing as
good as I think it is?
MR. WHITE: I don't know how good you think it is, but
it is good - but maybe not for the same reasons.
MR. LUXFORD: Another campaign argument that might
be made to these people is that you are going to put the
Republicans squarely on the spot. They are going to have
& definite program of international cooperation in the
monetary field, and this is the way to really flush the
Republicans out on where they are going to be for inter-
national cooperation.
H.M.JR: All right, but they have already been flushed
through Congressman Dewey, who has a bill, so our argument--
MR. LUXFORD: Have they said they go along with the bill?
It is nice to talk about broad general language, but will
they come up and really adhere to a program?
MR. WHITE: It is not an international--
H.M.JR: I thought Harry would like my statement, but
evidently he doesn't.
MR. WHITE: I like the statement, but don't expect
the reaction from technicians and professors that you want
to get, because we are overburdened with the necessity for
accuracy and it cramps our style.
H.M.JR: I thought you had gratuated from being &
professor and technician.
MR. BERNSTEIN: He is thinking of my sensibilities.
MR. WHITE: And my own. No, it is all right.
H.M.JR: That is the kind of thing it will take to
push it over.
15
- 13 -
MR. LUXFORD: I think Harry's point is significant,
that Dewey's program isn't one for international cooperation,
but national action.
MR. SMITH: Here is one other thing. Do you think it
would be advisable when you are having this meeting with
the chairmen to ask them to bring along a few key people
in addition to the chairmen so you would have a good army
in case they go to work on you?
H.M.JR: The trouble with that is, once you begin to
bring key people you hurt too many feelings.
MR. WHITE: That is right.
MR. O'CONNELL: This group is going to have about
ten people in it, anyway, Wednesday morning. It has the
leaders and chairmen of seven or eight committees. And
there will be a meeting with sixty or more in each House
Thursday.
H.M.JR: The chances are that the only fellow who
will talk will be Bloom, anyway, but we have enough.
MR. SMITH: All right.
MR. O'CONNELL: Mr. Secretary, there is a new committee
that is going to be in here who hasn't been in other meetings,
and that is the Colmer Committee in the House, which is the
counterpart in the House of George's Committee in the Senate
on post-war planning. They haven't been in on any of these
before because the Committee hadn't been created until a
couple of months ago. I assume that I ought to suggest
them to Barkley and Rayburn, particularly in the House,
as a Committee that has an interest in this.
MR. WHITE: What about that little informal House
committee that was formed and disappeared before Steagall
died? He was appointed chairman.
MR. O'CONNELL: All the members of that committee
are members of the other committee. But Colmer is not,
and that is the reason--
Regraded Unclassified
16
- 14 -
H.M.JR: O.K. What else?
Now, I think you can be on your way.
MR. O'CONNELL: I can? I wonder if you would think
it would be helpful if you would call Barkley and Rayburn
for me, because Rayburn, I think, for one--I don't know
Rayburn, and I would meet them with a little better
auspices.
H.M.JR: I can let Fitz do it. I think that is just
as good. Yes, I will tell him.
(The Secretary held a telephone conversation with
Mr. Fitzgerald.)
(Mr. O'Connell leaves the conference.)
MR. WHITE: Here is the Exchequer's reply.
H.M.JR: Fred, I want you to sit in on this until it
is finished, so you take it in through your pores, please.
MR. SMITH: All right. My pores are open!
H.M.JR: I wasn't sure. I have seen them closed.
This Monday morning stuff! God, how I have to work on
this stuff. The only people who seem normal this morning
are Luxford and me.
MR. LUXFORD: And he is not sure about me!
(The Secretary reads to himself communication of
April 15, 1944 from the Chancellor of the Exchequer.)
H.M.JR: What does "Non-Unitas basis" mean?
MR. WHITE: That is their version.
MR. BERNSTEIN: Their version given our name.
Unclassified
17
- 15 -
MR. WHITE: They took our name and put it in their
version. It was one of these one rabbit, one horse--not
one horse, this Army building up here--one rabbit, and
one Pentagon. They thought that would please us.
H.M.JR: What name do they use?
MR. WHITE: We are not using any name, but the "Non-
Unitas" version is the Keynes plan.
MR. BERNSTEIN: The Unitas version, Mr. White.
MR. WHITE: Yes, 80 they took our name and his plan,
and they thought that would please us.
H.M.JR: What is our name?
MR. WHITE: Unitas. And his plan--
H.M.JR: But that isn't the way it is now?
MR. WHITE: No, we dropped the name out entirely.
MR. BERNSTEIN: We will keep our plan.
H.M.JR: So it is our plan minus Keynes'?
MR. WHITE: It is a part compromise, but much more like
the American plan.
H.M.JR: They have now gotten across the idea that it
doesn't commit the Government.
MR. WHITE: There hasn't been any doubt of that in
the last eight months.
H.M.JR: Well, what they say is a technician's way
of saying what I said, this next paragraph about progressive
development, international trade, and stability of prices.
It is not very different from what I said.
MR. LUXFORD: I would say that there would be no one
that the Secretary speaks to who could possibly challenge
any statement he made.
18
- 16 -
H.M.JR: That is right.
H.M.JR: "In the light of these proposed arrangements
we should propose not to show any document to technical
experts of European Governments over here and to await
publication before discussing statement with them." They
don't want any leaks.
MR. WHITE: That is contrary to arrangements we pre-
viously made, and Opie concedes that is so. Our arrangements
were, as soon as the agreement was made we would show it.
MR. BERNSTEIN: They could show it 80 late, Mr. Secretary,
that there wouldn't be any problem of a leak.
H.M.JR: They act as though this was an agreement
between England and ourselves.
MR. WHITE: We are going to change that. We pointed
it out to them not only yesterday, but half a dozen times
before. They are constantly trying to make it appear that
this is an arrangement between the two countries.
You know they will say, "This statement of principles
for an international monetary fund is the result of close
study over many months at expert level between our two
countries. It in no way commits Governments concerned. It
is conceived as part of 8. general plan." We are changing
that.
H.M.JR: What else is there to do now?
MR. WHITE: We are drafting an answer to that
cable in which we will not only restate the points, but
also raise the question about the bank.
We received a statement from them, 8. copy of which
we haven't. He promised to give it to us, but he hasn't
yet. He read it to us, which includes the sentence that
they regard "the bank or some agency for providing credit
for reconstruction development as extremely important."
We want to give them three choices: One, to agree with
Regraded Unclassified
19
- 17 -
us on a similar statement of principles for the bank, copy
of which we have drafted, in which we have eliminated all--
or we think all--possible points of difference, leaving most
of that to be discussed at the conference.
H.M.JR: Well, I don't have to pass on that just this
minute. You are waiting for the answer, aren't you? You
are waiting until this cable comes in?
MR. WHITE: We are waiting for what cable to come in,
sir?
H.M.JR: The one you just mentioned.
MR. BERNSTEIN: The one in which they showed interest
in the bank.
MR. WHITE: That should be in this morning, because
he had a copy of it in his hands.
(The Secretary held a telephone conversation with
Secretary Hull, as follows:)
Read by Messrs. White, Bernstein,
20
Smith, O'Connell and Luxford.
April 17, 1944
10:17 a.m.
Operator:
Secretary Morgenthau is on the wire.
HMJr:
Hello.
Cordell
Hull:
Hello, Henry.
HMJr:
Good morning.
H:
I want to be sure that I was correct about this
International Monetary Conference proposition.
HMJr:
Please.
H:
Some days ago Acheson and Pasvolsky and one or two
others here had a conference with Mr. White.
HMJr:
Yes.
H:
I think you were away. And they had been opposed,
and we'd all been opposed to undertaking it for
lack of time this spring.
HMJr:
Yes.
H:
And they came back and repor ted to me that White
had convinced them that we should have it in May.
HMJr:
Yes.
H:
Is that right?
HMJr:
That's right.
H:
And they said, of course, the matter, they said
you and I would lay it before the President, with
you doing the main talking, 80 what then happened,
you had a talk with the President.
HMJr:
After you did.
H:
Well, I told him that he would talk that out with
you because you had the main functions to perform.
HMJr:
Yes.
H:
I said -- I told him then all I knew, that my
crowd had been convinced by White
Regraded Unclassified
- 2 -
21
HMJr:
Yes.
H:
....
that they should have it in May....
HMJr:
Yes.
H:
contrary to their judgment up to that time.
HMJr:
Yeah.
H:
And I said, "You will have to pass on it."
HMJr:
Who will?
H:
The President.
HMJr:
Yeah.
H:
"And you and Morgenthau get in touch. So that's
the way it was left and you talked with him and
then you and he agreed on May?
HMJr:
Well, no. Let me just explain. You remember it
was a Monday morning I called you at your home?
H:
Yes.
HMJr:
And spoke to you about this conference.
H:
Yeah.
HMJr:
And
H:
I repeated this White's conference conclusion.
HMJr:
And then you must have seen the President -- I
think you saw him at lunch, or something.
H:
Yeah.
HMJr:
And the President called me on the phone. I asked
to see him and he said, no, he would talk to me on
the phone.
H:
Yeah.
HMJr:
And he got on the phone and said to me, "Henry,
it's all right to go ahead with that conference
in May. " He brought up the subject.
H:
I see.
- 3 -
22
HMJr:
I didn't.
H:
You didn't talk with him then?
HMJr:
No, he simply said, on the telephone, "Henry,
it's all right to go ahead in May.
H:
Yes. Well, now, the reason I -- one of my
fellows 18 making an impression on me that he
thought he couldn't hold it before July and I
told him I didn't understand that at all as
part of the talk
HMJr:
No.
H:
....at the time.
HMJr:
No, this is what the situation is now and as
of this morning.
H:
Yeah.
HMJr:
We sent a cable through your office last week
H:
Yes, I saw it.
HMJr:
in which we said to the English that I had to
go up on the Hill Thursday and that I hoped that
I'd be able to say that the English Were in agree-
ment.
H:
Yeah.
HMJr:
But I would have to go one way or the other before
these three or four committees in the Senate and
three or four committees in the House.
H:
Yeah.
HMJr:
Because I've promised them that I would make a
report.
H:
Yeah.
HMJr:
Since then there have been a number of cables
between ourselves and the English; one coming in
yesterday from the Chancellor of the Exchequer.
H:
Yeah.
HMJr:
And we're practically together.
- 4 -
23
H:
Yeah.
HMJr:
I saw the Russian Ambassador -- I think it was
Friday -- in connection with this printing money
for -- I don't want to say -- for one of these
countries, you see?
H:
Yeah.
HMJr:
And I told the Russian Ambassador that I was
going up Thursday and I hoped that he would
have an answer for me before then because I
thought it was bad to have to say that they
didn't.
H:
Yeah.
HMJr:
But everything that we're doing here is aiming
towards May.
H:
Yes.
HMJr:
Does that make it clear?
H:
Yes, I wanted to be certain because somebody in
my group has gotten July
HMJr:
No, they're misinformed, Cordell.
H:
I told him that wasn't the way it was represented
to me
HMJr:
No.
H:
by my group
HMJr:
No.
H:
..of which he was one.
HMJr:
When the President got on the phone, I didn't
even raise the question.
H:
Yeah.
HMJr:
And he said, "Henry, it's all right to go ahead
and hold this in May."
H:
Yeah.
24
- 5 -
HMJr:
And I think I either called you or wrote you
a line and thanked you for what you'd done to
help us.
H:
Now, you don't -- you want to -- of course, this
is your business, but
HMJr:
Yes.
H:
you want to be awfully careful to keep a
frame-up over in these committees that you've
been before to postpone
HMJr:
Excuse me?
H:
You want to be mighty careful to keep down a
frame-up over there by some group in the
committee that you are going to appear before
to postpone this and give them more time.
HMJr:
Yes. Well
H:
You have to watch that or they 'll -- they will
throw this overboard, you see?
HMJr:
Well, I'm
H:
In a longer time.
HMJr:
I appreciate your caution but I am explaining to
the Demo -- I've asked to meet with the Democratic
Chairmen
H:
Yeah.
HMJr:
on Wednesday
H:
Yeah.
HMJr:
before I go up because I have to testify next
week
H:
Yeah.
HMJr:
on Congressman Dewey's bill
H:
Yeah.
HMJr:
which 18 a bill which is very near the same
but it has the Republican label.
- 6 -
25
H:
I know about that, yes.
HMJr:
And we want to -- the reason that we've done it
this week is, we want to get there and be on the
positive side
H:
Yeah.
HMJr:
....and not be defending ourselves.
H:
Yes. All right, then.
HMJr:
Now.
H:
I just wanted to keep absolutely clear what
HMJr:
Now, are there any other suggestions you'd care
to make?
H:
No, I haven't a thing in mind.
HMJr:
Is Acheson following this for you?
H:
He's supposed to be, yes.
HMJr:
Or Pasvolsky?
H:
Well, they -- Acheson is the head man.
HMJr:
Well, because the next
H:
But they're both working together.
HMJr:
Yeah. Well, the next day or two I'll be -- I hópe
I'll be moving fast and White and I will take
great pains to keep both of them posted on
H:
Yes. Pasvolsky knows more about the technical side,
you know.
HMJr:
I see. But now, is it all clear in your mind?
H:
Oh, yes, it's clear. It just was that date thing
I wanted to get clear.
HMJr:
And you have no other suggestions?
H:
No, not now. Thank you very much.
HMJr:
Thank you.
26
- 18 -
MR. WHITE: There isn't a single sneeze that we have
made that Pasvolsky hasn't reported.
H.M.JR: Wait a minute; somebody told him we were
aiming for July.
MR. WHITE: He just doesn't keep in contact with his
own people who are with us every step of the way.
H.M.JR: Now, Harry, do the old man justice. Somebody
over there may still be trying to cut our throat.
MR. WHITE: I am sure of it. I will give you 8 number
of bits of evidence.
H.M.JR: He said he was afraid it would be July, and
then he said, "Be sure that the Committee doesn't wangle
you into seeing that the thing goes over." Now, look, give
the old man credit. He put it 80 funny. You will have to
read it, the way he put it to the President, that White
said it was all right, and he said to the President that
this is what White wants, and "White has convinced my man
this is what they want.
MR. WHITE: You were present at every discussion we
have had. Mr. Secretary, that Pasvolsky, I think--well, I
can't quite make it out. He is fighting us behind the
scenes.
H.M.JR: That is it. Don't blame Hull. He goes in
and tells Hull, "This isn't going to be in May; the Treasury
is double-crossing you; this is going to be held in July."
You heard me say, "Is there anything else?"
He said, "No, I just wanted to make sure it was in
July."
"You saw the President?"
I said, "Afterwards."
The President picked up the phone and said to me, "Henry,
it is all right to go ahead in May."
27
- 19 -
MR. WHITE: We could wangle it 80 that Acheson takes
the lead instead of Pasvolsky.
H.M.JR: The next thing I am going to do, gentlemen,
is, we should have a meeting tomorrow with the people
there--
MR. WHITE: That is the next thing on the list, to
arrange a meeting with the same group that you met with
many months ago in which this thing was initiated. That
includes Secretary Jones, Eccles, and somebody from the
State Department, and Crowley.
(The Secretary notifies Mr. Fitzgerald of 9:00
o'clock appointments for April 18, 1944.)
H.M.JR: Harry, look, this is not the final gasp, but
another gasp of the group who went to the Disarmament Con-
ferences and all the other international conferences to keep
this country playing a second-class role.
MR. WHITE: That isn't their objective; that may be
the result.
H.M.JR: That was their objective, originally. Just
as long as they could keep London the center and keep the
English fleet on the basis of two to one for ourselves,
they had the world trade and kept us in a second place.
Now, you just stop and think a minute.
MR. WHITE: That may be the objectives over there, but
not here in the State Department. They are somewhat dif-
ferent objectives.
H.M.JR: Well, but they pull the wool over these
fellows. But if you stop and think, it is the same crowd
that kept our fleet small and kept us as a second-class
nation in the international monetary field. Have you ever
thought of that?
MR. LUXFORD: In London, that is true. I doubt that
about State, though.
28
- 20 -
H.M.JR: I an not saying State, but they are "me too's."
They go along.
MR. WHITE: The campaign by Pasvolsky and some of his.
colleagues is now being centered on the Bank to stop us
from discussing the Bank. The thing has gone too far to
stop the Fund, though Pasvolsky did lead the discussion
in the State Department to prove we ought not raise the
question of a fund before this summer. We went over there
in Dean Acheson's office, and after an hour or more of
discussion, convinced Dean Acheson that we were right and
they were wrong.
But Pasvolsky worked behind the scenes.
MR. LUXFORD: You know what I think it is, behind
Pasvolsky? He has been in charge of post-war planning.
The only thing he can show in the way of tangible results
is what Treasury has produced.
H.M.JR: Now, don't jump on me, Harry. Let me finish
what I am going to say. It may not be any good, but let me
suggest it; as an antidote to Pasvolsky with this conference
coming up, what would you think of calling in Herbert Feis
as a consultant?
MR. BERNSTEIN: Are you asking me? I don't think
Herbert Feis is good enough for the kind of work we do.
H.M.JR: I am talking politics now.
MR. WHITE: I think that will only make our task more
difficult, because it will make Pasvolsky fight all the
harder. The only chance we have is by bringing him on the
inside, and that is what we have tried to do; every time
we have had & conference we have called Pasvolsky in and
asked his advice, 80 he won't have the slightest justification
for saying either he didn't know or we weren't informing
him, or feel slighted in the least. Isn't that correct?
MR. LUXFORD: Yes.
29
- 21 -
MR. WHITE: Now, if we bring in somebody--and that is
one of the difficulties about Dean Acheson, except that he
is over them; he doesn't fight in the open. If he did, we
would be able to meet him. He is a throat-slitter of a
very vicious kind.
MR. LUXFORD: I think we had better play with Acheson.
H.M.JR: Wait until you read that conversation.
MR. WHITE: Is there any possibility of Pasvolsky
misunderstanding our program?
MR. BERNSTEIN: I don't see how it is possible any
longer. I am inclined to think now they are just knifing.
MR. WHITE: This explains, Mr. Secretary, also why he
complained, not once, but twice to Stettinius, without the
slightest grounds, because we have been very careful in
keeping him completely informed.
MR. BERNSTEIN: I think it is what Luxford has said,
Mr. Secretary, they have been laboring with committee after
committee in the State Department, and nothing concrete has
come out between the two proposals from the Treasury.
MR. LUXFORD: And they really are burned about it.
H.M.JR: I get this every two weeks, a digest of all
interviews with prisoners (refers to Army communication con-
cerning interviews with Allied prisoners). There is a
slight weakening in the morale for the first time.
MR. WHITE: The new prisoners coming in?
H.M.JR: Yes, English.
MR. WHITE: Do they do a good job in interviewing them?
H.M.JR: That, I don't know, but this is a summary
for over a two-weeks period. This is both from American
and Allied and British sources. Then they sum it up.. In
Regraded Unclassified
30
- 22 -
each case for the first time there seems to be a little
bit of weakening. But it was very interesting, to digress
a minute. Our saying that we were going to fight to a
conclusion and have no compromise was the worst thing that
we have done as far as morale is concerned. It is the one
thing that stiffened the morale of the German soldiers and
the German people more than anything else, that one state-
ment. They say, "What is the use if that is the case?"
Then they have gotten desperate. It is interesting. You
sit here and think, "Well, this would be a good thing to
do," and we will say, "We are going to fight this thing to
a conclusion, and that statement has done more to build
up the German morale than anything we have done.
MR. WHITE: Of course, the statement was made to
meet home consumption because the people were afraid we
were going to quit.
H.M.JR: Yes. One other thing, Harry, and Bernstein,
make notes; whenever we get out of this jam I want to
talk to you people about this new Committee of Civil Affairs
in London, you see, with no Treasury representative. I
don't want to talk about it now.
MR. WHITE: That is Taylor?
H.M.JR: Please make a note of it. My thought is that
I could either telephone or cable Stettinius and say to
him, "Now, look, I think there should be a Treasury rep-
resentative. I got that idea over the week end. I can
try to telephone Stettinius over Eisenhower's telephone,
which is not listened to by the English. I could get on
that phone and say, "Look, Ed, if you could look into this
thing for me--" he will be there another two or three weeks.
I can call him up. It doesn't have to go through the State
Department; the English can't listen. I will say, "Look,
Ed, would you mind having a look at this Committee for me?
You have two State Department representatives, and we have
none."
MR. SMITH: We had another discussion while you were
out here. What would you think of having a statement all
ready for Hull to release on Thursday, just backing us up
Regraded Unclassified
31
- 23 -
a hundred percent, making it a solid front, and having in
it that you want Hull committed, too?
H.M.JR: I hadn't approached that. I was thinking of
Acheson going up there with me. But if we can get Hull in
to share it with me, I think it would be all to the good.
Now, you think of how to do it, see, but Hull should be in
it. He said something very good last night, that this is
terribly important, and when it is all through and done,
this and the financing of the war will most likely be the
most important things that will have been done while I was
here.
MR. WHITE: This would be a permanent something.
H.M.JR: But the financing of the war--
MR. WHITE: Yes, I wasn't comparing it with the
financing of the war.
H.M.JR: I compare it--
MR. LUXFORD: That is one reason, Mr. Secretary, I
would query whether you want Hull to go up there with you
or have Hull issue a statement the same day.
MR. WHITE: I don't think Hull should go up; if
anybody goes up, it should be Acheson.
H.M.JR: Acheson should go up and have & part of it;
and if we could prepare a statement for Hull that he could
give out after this thing is over, I think it would be
fine.
MR. LUXFORD: At the same time.
MR. WHITE: Can I go to the next item? We are pre-
paring a cable to the Russians which we have and would
like to read.
H.M.JR: Don't do anything that isn't looking toward
this meeting on Thursday.
Regraded Unclassified
32
- 24 -
H.M.JR: That can't go until you hear from the English?
MR. WHITE: No, but we will send it the minute we do.
MR. BERNSTEIN: This can go now, Mr. White.
MR. WHITE: This says we have received an agreement,
and we haven't.
H.M.JR: Why don't I do it when I have the whole thing?
MR. WHITE: I don't think you want to read the other,
anyway. They are corrections in the technical draft.
H.M.JR: Oh.
(The Secretary reads first page of attached cable to
the American Embassy, Moscow, dated April 17, 1944.)
Did the cable go to Harriman on the monetary business,
the printing of money?
MR. LUXFORD: Yes.
H.M.JR: That went Saturday, didn't it, bringing
Harriman up to date?
MR. WHITE: Yes, I am pretty sure. I don't know whether
we sent it to the State Department or directly out. I don't
know.
H.M.JR: Who would?
MR. WHITE: Only I would know--Taylor or I or Mrs.
Shanahan, preferably Taylor.
(Mrs. Shanahan and Mr. Taylor enter the conference
temporarily.)
H.M.JR: Why not say we plan to have it signed in
Washington, London, and Chung King?
Regraded Unclassified
33
- 25 -
MR. BERNSTEIN: Above it speaks of China and the United
Kingdom joining.
H.M.JR: It should be London, Chung King--
MR. BERNSTEIN: Yes, sir; we have it down there, but
not up here.
MR. WHITE: These other things can wait. There is just
one item I would like to call your attention to; it relates
to the general background. The State Department, under the
leadership of whom, I don't know, is insisting that when we
talk of a conference, it shall not be of Finance Ministers;
and the position they have taken is, you only invite govern-
ments to send representatives, not special ministers.
I want to call your attention to this Rio conference
of Ministers of Foreign Affairs. The reason why we put
Ministers of Finance was at that meeting when we said we
wanted it in the Treasury, so we said, instead of Ministers
of Foreign Affairs, we would put Ministers of Finance. That
was our resolution and the fight we had then. So there is
a background for it.
H.M.JR: Wasn't there one to be called Ministers of
Finance, subsequently, some meeting you went down to?
MR. WHITE: It was the last meeting I was at, at Rio.
H.M.JR: Didn't they pass a resolution?
MR. WHITE: That is the resolution which we have in
there.
H.M.JR: Where is it? Show it to me. That is what
I am a sking for.
34
- 26 -
MR. LUXFORD: Harry, isn't it fairly clear that this
is Pasvolsky again? He is always articulate on this point
MR. WHITE: We put it in. There was quite a fight
at the time. (Mr. White points out resolution to the
Secretary.)
H.M.JR: Yes, well, what I thought I would do was to
call up Acheson now on the phone.
MR. WHITE: There is this complicated circumstance
which I don't know how to resolve yet. That is, the British
are taking the view they won't send a Minister.
They are also taking the view that this will not be
what they call a meeting of plenipotentiaries; plentipoten-
tiaries being people who can commit their government, and,
therefore, Ministers don't--of course, there still remains
the problem of whether they will agree.
H.M.JR: Let me get this straight now with Acheson,
first.
MR. WHITE: The cable has not gone. We just had it
ready.
H.M.JR: It should have gone.
MR. WHITE: We notified the State Department, Dunn,
and he said he was going to notify them. That cable, I
remember now, was on my desk ready to go when Dunn called
up and said he would notify Harriman.
H.M.JR: But you were 80 insistent with me that you
wanted a Treasury draft to go.
35
- 27 -
MR. WHITE: Because I thought at the time we wanted
to tell them it was the Combined Chiefs of Staff that
held it up; and I thought it would not be wise to put
that in & cable, so we told the Ambassador.
H.M.JR: What does this cable say? (Mr. White
hands attached draft of cable to Mr. Harriman, dated
April 17, 1944 to the Secretary.)
Why has this been held up?
MR. WHITE: Now that I remember it, I decided not
to send it because he was going to cable directly.
H.M.JR: You mean not at all?
MR. WHITE: I don't think so, since Dunn said he
would cable Harriman.
H.M.JR: There isn't much purpose in sending this
now.
MR. WHITE: There isn't much purpose, no.
H.M.JR: This is what I thought I would do, that I
call up Acheson on the phone and say, "Look, Dean, we are
having this meeting tomorrow. I don't want to have a
public discussion, but if there is any question as to how
this conference is to be held, and if it isn't going to
follow the pattern of the Rio Conference, I would like
to talk to you about it privately."
MR. WHITE: He has notified me that Hull specifically
wanted deletion of reference to a conference of Finance
36
- 28 -
Ministers, and make it "...of Representatives of Govern-
ments." That is when we deleted it in the cable.
H.M.JR: Let me talk to him about it. I will say
that I wish he would stay behind tomorrow and talk to me
about it. Mr. Hull has said any of these matters ought
to be matters between Treasuries. Harry, why don't you
let me go ahead and do this?
MR. WHITE: Because it is the British that are troubl-
ing me, not the State Department.
H.M.JR: Let me get my own Government straightened
out, first. What do you boys think?
MR. BERNSTEIN: I think so, yes, sir. It should be
cleared up in the State Department. If we are together,
then we can put a united front toward the British.
H.M.JR: But how can I say to the British, "I want
you to send over the Minister of Finance," if the State
Department isn't backing me?
MR. LUXFORD: Let the British send whom they want.
H.M.JR: I have to get my own State Department straight-
ened out, don't I?
MR. WHITE: The British have not yet agreed to any
conference. That is the next step.
H.M.JR: But let me get one thing straightened out
at a time.
What else?
MR. WHITE: I think that should suffice for the
morning. We also have to prepare the statement, which
we will begin on at once.
H.M.JR: I want Smith to sit in on it from the
beginning.
Regraded Unclassified
37
- 29 -
MR. WHITE: Also we have a number of meetings with
the representatives of other Governments on this point
now, but they don't need to concern you.
There is just one point about which apparently
Bernstein and I are not together on what your judgment
is on this. In this telegram from the Exchequer, there
is the statement - "Provided that an agreement on outstand-
ing points can be reached in time, publication will be
next week as you desire." There remain three points of
difference, two of negligible importance, one of possible
importance. Opie cannot commit his Government, and he
was going to cable yesterday. We assume that we get an
answer saying that they agree on those three points.
MR. BERNSTEIN: My point was the practical one that
there was no chance at all of getting a cable to Moscow
in time to have any notion of whether they are issuing it
or not when the Secretary appears, unless we cable today.
MR. WHITE: Irrespective of whether we get an
answer.
MR. BERNSTEIN: Therefore, we must reaily go ahead.
H.M.JR: what does that mean?
MR. BERNSTEIN: When they ask you on Thursday whether
the Soviet Union has joined in the statement or not, you
ought to know the answer - whatever you may give to them.
There is no way of getting an answer from Moscow unless
we cable today.
MR. WHITE: Without waiting to hear the final word--
MR. BERNSTEIN: There is no doubt the reply will be
perfectly satisfactory on the language we talked about
yesterday from the British.
H.M.JR: May I make a suggestion? Why couldn't
everybody perfectly well be in agreement except the
English? I would go ahead with a cable to Harriman and
Regraded Unclassified
s/4
38
- 30 -
say that we hope to get an agreement with the Russians,
irrespective of what the British do.
MR. WHITE: We have done that.
MR. BERNSTEIN: That was the previous cable, Mr.
Secretary.
MR. LUXFORD: I think we can tell Harriman that the
British have indicated they will go along. There is one
minor point but we don't envision any difficulty in
proceeding on the premise that they will agree.
MR. WHITE: We have told the Ambassador that?
H.M.JR: which?
MR. WHITE: Russian Ambassador, after you spoke
to him. I said we were practically in agreement, but
not quite. There is nothing we can add unless we say
the British agree. Now, the chances are ninety-nine
out of a hundred they will.
H.M.JR: Have you told them you want simultaneous
publication with the Russians?
MR. WHITE: Yes. We might call Opie up and tell him
that in order to get simultaneous arrangement, we have to
send another cable off, and can we assume that his Govern-
ment will agree? If he says yes, we will go ahead! If
he says no, we won't.
H.M.JR: All right?
MR. WHITE: There are a number of other matters,
but they will wait.
H.M.JR: They will have to.
MR. WHITE: I mean on this same thing - but they can
wait. The whole question of the Bank which we haven't
touched, we want to take up with this. We have only been
talking so far about the Fund.
Regraded Unclassified
39
- 31 -
H. M.JR: Am I not going to make a report on both
on Thursday?
MR. WHITE: That remains to be seen.
MR. BERNSTEIN: Mr. White started to give you three
alternatives, but I don't think he finished. So we have
been talking about the Fund only.
H.M JR: God, Harry, you do make this about as
difficult for me as you can.
MR. WHITE: That is a special technique!
H.M.JR: I don't see why you make it so difficult.
You haven't decided whether I am going to report on the
bank on "hursday.
MR. WHITE: That is right, because we haven't got
the British permission, and we either do it with or with-
out.
H.M.JR: All right. I am not going to sit around and
wait. If I don't tell them, it will leak out.
MR. WHITE: Well, we haven't gone nearly as far with
the British on the Bank. They have been holding it up.
It is only recently, within the last few days, that they
have turned a somersault and said they are eager for
the Bank, and that is why we have drafted & general
principle of a bank to avoid as many possible points of
difference as we can, so they will have the least trouble
in agreeing.
H.M.JR: Now, look, gentlemen, you can't have had
all this discussion in the paper. Somebody ought to know
the last time I was up there.
MR. BERNSTEIN: It was in October, I guess.
H.M.JR: I have to be prepared. Somebody up there
smart is going to say - once they hear the meeting is
Regraded Unclassified
s/6
40
- 32 -
called - the Republican National Committee will plan a
lot of questions. They will say, "What about the Bank,
Mr. Morgenthau? Where does it stand?" I will have to
have a statement prepared.
MR. WHITE: Yes, you will have a statement prepared.
The question now is what the statement will say. No
matter what it is, you will r efer to the Bank.
H.M.JR: You have to tell them just where it is,
who is holding out, and everything else. The only way to
do with these people is to be frank. Tell them every-
thing.
MR. BERNSTEIN: That is what Mr. White contemplates
in this statement. The point that he was making was what
you will be able to say at that stage. It will be per-
fectly frank, whatever the statement is.
H.M.JR: What are you arguing about? You have to
be prepared. Between now and Thursday we have to have
a group of questions. You people have to have & group
of questions to ask me. You have to ask me every kind of
a question under the sun. I have to be grilled on these
things. I can't be sitting here not knowing the answers.
I have to answer where we stand and tell these people the
truth.
I am not going to be evasive. I want all the answers,
irrespective of what the situation is. Tell the British,
tell the Russians, teil the Committees, I am going to
discuss this thing freely. I hope it won't be in the
papers, but the chances are ninety-nine out of a hundred
it will be in the papers. I am not going to go up there
and be & dummy on this thing.
I am going to discuss the whole thing and make a
report of what the technicians have done since last
October. If you don't want me to do that, I don't want
to go up there. I want to have in my mouth, in my hands,
in writing, 8. report of what has been going on in the last
six months.
Regraded Unclassified
41
- 33 -
MR. BERNSTEIN: Mr. Secretary, if the British agree
to publish a statement a week later, would it be possible
to tell the Committee that we are now preparing with
the British, on the Bank alone, a joint statement which
will be ready for publication in a week, and you will send
it up to them at that stage? In that way we could have
the extra effect.
H.M.JR: If that is the best you can do, all right.
But they will most likely come back and say, "Well,
are we going to read it in the papers first from London?"
MR. WHITE: The answer is no.
I raised this discussion about the Bank because I
wanted to make certain that you appreciate that the dis-
cussions on the Dank with the British are not nearly as
far along as with the Fund, because of their refusal to
discuss it until the last few days, and that we are
going to put as much pressure as we can--
H.M.JR: Well, you call Mr. Opie on the telephone
and say, "I have just come from the office of the Secretary
of the Treasury and he is going to make a factual report
of what the technicians have done in the last six months,
and he is going" - the whole works. You tell Sir John
Anderson that.
MR. WHITE: All right.
H.M.JR: You have got to do it, Harry. We cannot
go up there - those boys are smart. Here Taft announces
this morning they have a group studying how to raise
taxes. Those people - the minute it goes out that the
meeting is going to be called, they are going to prepare
their group to make it just as embarrassing for me as
possible.
MR. SMITH: That is right. They will make it so it
will add up to the Dewey bill.
H.M.JR: And you people have been all over the country,
you have been talking on the Bank, haven't you?
Regraded Unclassified
s/8
42
- 34 -
MR. BERNSTEIN: We haven't spoken as much on the
Bank, but we have spoken on it.
H.M.JR: The Congress of the United States is entitled
to know just as much as whatever you have said in New York.
MR. BERNSTEIN: I wonder, nevertheless, Mr. Secretary,
if a statement coming a week later on the Bank, in the
midst of the Dewey hearings, wouldn't give us more publicity
and set up more clearly the difference between our inter-
national approach and his one-sided national approach.
MR. WHITE: The Secretary wants to be able to tell
them what we have done. We certainly wouldn't get agree-
ment with the British with that statement of principles
by the Bank. Opie said that is impossible.
H.M.JR: Luxford, you are here advising White and
me. Can I go up there and not make a full report?
MR. LUXFORD: Harry agrees with you.
H.M.JR: He hasn't said.
MR. WHITE: There has never been any doubt on that
score, but I want to indicate the degree of progress
that you will be able to make is much different in the
Bank than it is with the Fund.
H.M.JR: All right.
MR. LUXFORD: Just one thing I would like to add.
H.M.JR: Are you in agreement that I have to give &
factual report where we stand as of Thursday, and no
bluffing, no pulling the punches, or. anything else?
MR. LUXFORD: Certainly.
H.M.JR: If we can get to the point and say, "Well,
we are going to give you & report & week from now - that
Regraded Unclassified
43
- 35 -
is the best we can do - I am sorry, but we are having
our troubles pulling these people together," all right;
but I want to be completely frank and I will not say
anything White says that I shouldn't.
But I want to say, "Gentlemen, this is an up-to-
the-minute report where things stand. We have had cer-
tain successes and certain failures, and I want to take
you completely into my confidence. You are going to
know just where the thing stands." And give them the
failures, if you want, first. Let me take the wind out
of their sails. But I am not going to go up and spar
with them.
MR. LUXFORD: There is just one thing, Mr. Secretary.
H.M.JR: But you fellows have to prepare a group of
questions and answers, and put me through this thing.
I am willing to be put through it. I will get mad and
impatient, but you have to put me through these questions
and answers. You can clear your own thinking when you
write them, too.
MR. WHITE: I have been thinking about this for
two years. It would be kind of late for us to clear
our thinking, Mr. Secretary.
H.M.JR: Then it will be easy to write the questions
and answers.
MR. WHITE: Sure will. We have almost all of them
written.
H.M.JR: Then you have it, and my remark is uncalled-
for.
MR. LUXFORD: I query whether you want to tell Opie
at this moment that you are going up there, and in any
event give & full disclosure on the Bank and where it
stands with the British, until after the British have gone
along with the publication of your statement. I wouldn't
inject that Bank issue until you have the British on the
line.
Regraded Unclassified
/10
44
- 36 -
MR. WHITE: I think that could be better worked out.
I know just what you have in mind; I agree with you and
we will work it out.
H.M.JR: Gentlemen, I am not going up before the
Congress of the United States and not make & full dis-
closure of where we stand.
MR. LUXFORD: Everybody agrees.
H.M. JR: Here it is Monday. It is now four or five
o'clock in London. Time is passing and I think if I am
going to do it, you ought to tell the British. I haven't
been in on these conferences, so I don't know. But I
am on the spot now. And whatever happens - I mean, some
God damned figures are published in the statement which
I don't even read, and it is Morgenthau, although it is
the Office of the Treasurer of the United States, Julian,
who comes here one day a week, but I have to take it,
and I should.
MR. WHITE: Comes where, one day a week? Not in
this office. Do you see Julian once a week?
H.M.JR: Once every other year.
MR. WHITE: Comes to work once a week.
H.M.JR: That is biennial.
The point I am getting over is, I realize that white
and his staff have done everything that any human can do;
I realize they are up against the most forceful financial
group in the world, who don't want this thing to happen.
Now, here it is Monday. I have to go up Thursday.
You fellows have to put in my mouth all the answers, and
you might just as well tell the British and the Russians
we are going to do it.
MR. LUXFORD: Why don't you wait until you get that
cable from London?
Regraded Unclassified
/11
45
- 37 -
MR. WHITE: It is all right, we have the point.
H.M.JR: I don't care as to whether it is anhour, or
this afternoon, but don't forget they can move fast
as between five o'clock one afternoon and the next morning.
I stopped the Chancellor of the Exchequer from making a
report on Lend-Lease in Reverse. I don't care whether
this morning or this afternoon, but certainly today, you
ought to tell Opie what I am going to do.
Am I right, Fred?
MR. SMITH: Yes, indeed. I think you are right.
Another thing, I think you had better think two or three
times before you have any statement on a Bank appear here
at the time that the Dewey hearings are going to be held,
because you have all the people sitting up ready to
kibitz it. They have the newspapers there, and every-
thing.
(The Secretary holds 8 telephone conversation
with Mr. McConnell, as follows:)
Dearaded
46
April 17, 1944
11:08 a.m.
HMJr:
Okay.
Operator:
Go ahead.
Robert
McConnell:
Hello.
HMJr:
Hello, McConnell.
M:
Good morning, sir.
HMJr:
How are you?
M:
Colonel Doyle is here discussing this problem
and you asked me to call you when he came in.
HMJr:
Oh, yes.
M:
Now, he's got some very good ideas on it. If you --
he's going to be here all day -- if you have five
or ten minutes, I think it will be worthwhile to
talk to him.
HMJr:
Colonel Doyle?
M:
Yeah.
HMJr:
Well, now, wait a minute. I've got White in here.
M:
The first thing he asked me, Mr. Secretary,
whether we'd talked to Leonard Wood or not.
HMJr:
Well, Colonel Doyle? Wait a minute -- let me
ask -- supposing you bring him in at three
o'clock.
M:
At three?
HMJr:
Yes. Will you?
M:
At three o'clock, I'll bring
HMJr:
I'll see him at three o'clock.
M:
All right. Thank you.
/12
47
- 38 -
H.M.JR: Coionel Doyle at three o'clock.
MR. WHITE: Dewey wrote you a letter. I think if it
can be avoided, I am not sure whether you will want to go,
because if you do they will try to make of it a Roman
Holiday and you may not have to go. You can send a Trea-
sury representative.
MR. LUXFORD: I wouldn't dignify it, Mr. Secretary,
by your attending Dewey's.
H.M.JR: It is a question of whether Daniel should
enter the lion's den. You gentlemen come back at three-
fifteen.
MR. WHITE: I didn't want you to commit yourself.
H.M.JR: Whom would I talk to besides you fellows?
I am not going to taik to Drew Pearson.
MR. LUXFORD: Can we count on that?
H.M.JR: Better than I can count on some other
people outside of this room.
48
April 17, 1944
Mr. Collado
Mr. White
Please send the following cable to the American limbassy, Moscow.
"This is a massage to Harriman from the Secretary of the Treasury.
*1. I would appreciate it if you would call on the People's
Commissar of Finance and inform him that I have just received word
from the Chansellor of the Exchequer informing us of their agreement to
the publication of the joint statement of the technical experts of
the United and Associated Nations recomenting the establishment of
an international monstary fund. It is contemplated that the publication
will be simultaneous in London and Washington. It would obviously be
highly desirable if the statement were also issued at the same time
in Mossow.
"Please stress the desirability, for obvious reasons, of having
the Soviet Union join with the United States, the United Kingdom,
China and other United Nations in a statement of this character setting
forth the recommendations of the experts on international monstary
cooperation.
*2. Arrangements have been made for the release of this state-
mont in Washington and in London and in & number of other countries
immediately after my appearance before the appropriate Congressional
committees which 10 definitely scheduled for Thursday afternoon.
Time of release is 8:00 p.m. Thursday, April 20, Washington time.
"3. The text to be released contains the following provisions
in place of these of correspending mmbers in the joint statement
cabled to your
"I-5
To assist in the establishment of multilateral payments
facilities on current transactions among member countries
and the elimination of foreign exchange restrictions
which hamper the growth of world trade.
"II-1 Member countries shall subscribe in gold and in their
local funds amounts (quotas) to be agreed, which will
mount altogether to about $8 billion if all the United
and Associated Nations subscribe to the Fund (corres-
ponding to about $10 billion for the world all a whole.)
Regraded Unclassified
49
- 2 -
"II-2
The quotas may be revised periodically with approval
of a four-fifths vote; but no change shall be made in
a member's quota without its assent.
"II-3
The obligatory gold subscription of a member whose home
areas have suffered substantial damage from enemy action
or occupation shall be only three-fourths of the above.
"III-2(c) The Fund's total holdings of the currency offered (after
having been restored, if below that figure, to 75 percent
of the member's quota) have not been increased by more
than 25 percent of the member's quota during the previous
twelve months and do not exceed 200 percent of the quota.
"III-5
So long as a member country is entitled to buy another
member's currency from the Fund in exchange for its own
currency, it shall be prepared to buy its own currency
from that member with that member's currency or with gold.
This shall not apply to currency subject to restrictions
in conformity with IX, 3 below, or to holdings of currency
which have accumulated as a result of transactions of &
current account nature effected before the removal by the
umber country of restrictions on multilateral clearing
maintained or imposed under X, 2 below.
"VII-1
The Fund shall be governed by a board on which each member
will be represented and by an executive committee. The
executive committee shall consist of at least nine members
including the representatives of the five countries with
the largest quotas.
"VII-2
The distribution of voting power on the board and the
executive committee shall be closely related to the quotas.
"X-3
The Fund may make recommendations to any member that
conditions are favorable to the withdrawal of particular
restrictions or for the general abandonment of the re-
strictions inconsistent with IX, 3, above. Not later
than three years after coming into force of the Fund any
nember still retaining any restrictions inconsistent
with IX, 3 shall consult with the Fund as to their further
retention."
Regraded Unclassified
50
For Release:
April 17, 1944
8:00 P.M., April 21, 1944
Joint Statement by Experts on the Establishment
Of an International Monetary Fund
Sufficient discussion of the problems of international
monetary cooperation has taken place at the technical level
to justify a statement of principles. It is the consensus
of opinion of the experts of the United and Associated
Nations who have participated in these discussions that the
most practical method of assuring international monetary
cooperation is through the establishment of an International
Monetary Fund. The principles set forth below are designed
to constitute the basis for this Fund. Governments are not
asked to give final approval to these principles until they
have been embodied in the form of definite proposals by the
delegates of the United and Associated Nations meeting in a
formal conference.
I. Purposes and Policies of the International Monetary Fund.
The Fund will be guided in all its decisions by the pur-
poses ano policies set forth below:
1. To promote international monetary cooperation through
a permanent institution which provides the machinery for con-
sultation on international monetary problems.
2. To facilitate the expansion and balanced growth of
international trade and to contribute in this way to the main-
tenance of a high level of employment and real income, which
must be a primary objective of economic policy.
3. To give confidence to member countries by making the
Fund's resources available to them under adequate safeguards,
thus giving members time to correct maladjustments in their
balance of payments without resorting to measures destructive
of national or international prosperity.
4. To promote exchange stability, to maintain orderly
exchange arrangements among member countries, and to avoid
competitive exchange depreciation.
5. To assist in the establishment of multilateral payments
facilities on current transactions among member countries and
in the elimination of foreign exchange restrictions which
hamper the growth of world trade.
6. To shorten the periods and lessen the degree of dis-
equilibrium in the international balance of payments of
member countries.
Regraded Unclassified
51
- 2 -
II. Subscription to the Fund.
1. Member countries shall subscribe in gold and in
their local funds amounts (quotas) to be agreed, which will
amount altogether to about $8 billion if all the United and
Associated Nations subscribe to the Fund (corresponding to
about (10 billion for the world as a whole.)
2. The quotas may be revised from time to time but
changes shall require a four-fifths vote and no member's
quota may be changed without its assent.
3. The obligatory gold subscription of a member country
shall be fixed at 25 percent of its subscription (quota) or
10 percent of its holdings of gold and gold-convertible ex-
change, whichever is the smaller.
The obligatory gold subscription of a member whose home
areas have suffered substantial damage from enemy action or
occupation shall be only three-fourths of the above.
III. Transactions with the Fund.
1. Member countries shall deal with the Fund only through
their Treasury, Central Bank, Stabilization Fund, or other
fiscal agencies. The Fund's account in a member's currency
shall be kept at the Central Bank of the member country.
2. A member shall be entitled to buy another member's
currency from the Fund in exchange for its own currency on the
following conditions:
(a) The member represents that the currency demanded
is presently needed for making payments in that
currency which are consistent with the purposes
of the Fund.
(b) The Fund has not given notice that its holdings
of the currency demanded have become scarce in
which case the provisions of VI, below, come into
force.
(c) The Fund's total holdings of the currency offered
(after having been restored, if below that figure,
to 75 percent of the member's quota) have not
been increased by more than 25 percent of the
member's quota during the previous twelve months
and do not exceed 200 percent of the quota.
Regraded Unclassified
52
- 3 -
(a) The Fund has not previously iven appropriate
notice that the member is suspended from making
further use of the Fund's resources on the
ground that it is using them in 8 manner con-
trary to the purposes and policies of the Fund;
but the Fund shall not give such notice until it
has presented to the member concerned a report
setting forth its views and has allowed a suit-
able time for reply.
The Fund may in its discretion and on terms which safe-
guard its interests waive any of the conditions above.
3. The operations on the Fund's account will be limited
to transactions for the purpose of supplying a member country
on the member's initiative with another member's currency in
exchange for its own currency or for gold. Transactions pro-
viaea for under 4 and 7, below, are not subject to this limita-
tion.
4. The Fund will be entitled at its option, with a view
to preventing a particular member's currency from becoming
scarce:
(a) To borrow its currency from & member country;
(b) To offer gold to a member country in exchange
for its currency.
5. So long as a member country is entitled to buy another
member's currency from the Fund in exchange for its own cur-
rency, it shall be prepared to buy its own currency from that
member with that member's currency or with gold. This shall not
apply to currency subject to restrictions in conformity with
IX, 3 below, or to holdings of currency which have accumulated
as a result of transactions of a current account nature effected
before the removal by the member country of restrictions on
multilateral clearing maintained or imposed under X, 2 below,
6. A member country desiring to obtain, directly or
indirectly, the currency of another member country for gold
is expected, provided that it can do so with equal advantage,
to acquire the currency by the sale of gold to the Fund. This
shall not preclude the sale of newly-mined gold by 8 gold-
producing country on any market.
7. The Fund may also acquire gold from member countries
in accordance with the following provisions:
(a) A member country may repurchase from the Fund
for gold any part of the latter's holdings of
its currency.
Regraded Unclassified
53
- 4 -
(b) So long as a member's holdings of gold and gold-
convertible exchange exceed its quota, the Fund
in selling foreign exchange to that country shall
require that one-half of the net sales of such
exchange during the Fund's financial year be paid
for with gold.
(c) If at the end of the Fund's financial year a
member's holdings of gold and gold-convertible
exchange have increased, the Fund may require
up to one-half of the increase to be used to
repurchase part of the Fund's holdings of its
currency SO long as this does not reduce the
Fund's holdings of a country's currency below
75 percent of its quota or the member's hold-
ings of gold and gold-convertible exchange
below its quota.
IV. Par Values of Member Currencies.
1. The par value of a member's currency shall be agreed
with the Fund when it is admitted to membership, and shall be
expressed in terms of gold. All transactions between the Fund
and members shall be at par, subject to a fixed charge payable
by the member making application to the Fund, and all transac-
tions in member currencies shall be at rates within an agreed
percentage of parity.
2. Subject to 5, below, no change in the par value of a
member's currency shall be made by the Fund without the coun-
try's approval. Member countries agree not to propose a change
in the parity of their currencies which will affect their inter-
national transactions unless they consider it appropriate to the
correction of a fundamental disequilibrium. Changes shall be
made only with the approval of the Fund, subject to the provi-
sions below.
3. The Fund shall approve a requested change in the par
value of a member's currency, if it is essential to the correc-
tion of a fundamental disequilibrium. In particular, the Fund
shall not reject a requested change, necessary to restore
equilibrium, because of the domestic social or political
policies of the country applying for a change. In considering
8. requested change, the Fund shall take into consideration the
extreme uncertainties prevailing at the time the parities of
upon. the currencies of the member countries were initially agreed
Regraded Unclassified
54
- 5 -
4. After consulting the Funa, a member country may
change the established parity of its currency, provided the
proposed change, inclusive of any previous change since the
establishment of the Fund, does not exceed 10 percent. In
the case of application for a further change, not covered by
the above and not exceeding 10 percent, the Fund shall give
its decision within two days of receiving the application, if
the applicant so requests.
5. An agreed uniform change may be made in the gold
value of member currencies, provided every member country
having 10 percent or more of the aggregate quotas approves.
V. Capital Transactions.
1. A member country may not use the Fund's resources to
meet a large or sustained outflow of capital, and the Fund
may require a member country to exercise controls to prevent
such use of the resources of the Fund. This provision is
not intended to prevent the use of the Fund's resources for
capital transactions of reasonable amount required for the
expansion of exports or in the ordinary course of trade,
banking or other business. Nor is it intended to prevent
capital movements which are met out of a member country's own
resources of golá and foreign exchange, provided such capital
movements are in accordance with the purposes of the Fund.
2. Subject to VI, below, a member country may not use its
control of capital movements to restrict payments for current
transactions or to delay unduly the transfer of funds in settle-
ment of commitments.
VI. Apportionment of Scarce Currencies.
1. When it becomes evident to the Fund that the demand
for & member country's currency may soon exhaust the Fund's
holdings of that currency, the Fund shall so inform member
countries and propose an equitable method of apportioning
the scarce currency. When a currency is thus declared scarce,
the Fund shall issue a report embodying the causes of the
scarcity and containing recommendations designed to bring it
to an end.
2. A decision by the Fund to apportion a scarce currency
shall operate as an authorization to & member country, after
consultation with the Fund, temporarily to restrict the freedom
of exchange operations in the affected currency, and in deter-
mining the manner of restricting the demand and rationing the
limited supply among its nationais, the member country shall
have complete jurisdiction.
Regraded Unclassified
55
- 6 -
VII. Management.
1. The Fund shall be governed by a board on which each
member will be represented and by an executive committee.
The executive committee shall consist of at least nine members
including the representatives of the five countries with the
largest quotas.
2. The distribution of voting power on the board and
the executive committee shall be closely related to the quotes.
3. Subject to II, 2 and IV, 5, all matters shall be
settled by a majority of the votes.
4. The Fund shall publish at short intervals a state-
ment of its position showing the extent of its holdings of
member currencies and of gold and its transactions in gold.
VIII. Withdrawal.
1. A member country may withdraw from the Fund by giving
notice in writing.
2. The reciprocal obligations of the Fund and the
country are to be liquidated within a reasonable time.
3. After B. member country has given notice in writing
of its withdrawal from the Fund, the Fund may not dispose of
its holdings of the country's currency except in accordance
with the arrangements made under 2, above. After a country has
given notice of withdrawal, its use of the resources of the
Fund is subject to the approval of the Fund.
IX. The Obligations of Member Countries.
1. Not to buy gola at a price which exceeds the agreed
parity of its currency by more than a prescribed margin and not
to sell gold at a price which falls below the agreed parity by
more than a prescribed margin.
2. Not to allow exchange transactions in its market in
currencies of other members at rates outside a prescribed
range based on the agreed parities.
3. Not to impose restrictions on payments for current
international transactions with other member countries (other
than those involving capital transfers or in accordance with
VI, above) or to engage in any discriminatory currency arrange-
ments or multiple currency practices without the approval of
the Fund.
Regraded Unclassified
56
- 7 -
X. Transitional Arrangements.
1. Since the Fund is not intended to provide facilities
for relief or reconstruction or to deal with international
indebtedness arising out of the war, the agreement of a member
country to provisions III, 5 and IX, 3, above, shail not become
operative until it is satisfied as to the arrangements at its
disposal to facilitate the settlement of the balance of payments
differences during the early post-war transition period by
means which will not unduly encumber its facilities with the
Fund.
2. During this transition period member countries may
maintain and adapt to changing circumstances exchange regula-
tions of the character which have been in operation during the
war, but they shall undertake to withdraw as soon as possible
by progressive stages any restrictions which impede multilateral
clearing on current account. In their exchange policy they
shail pay continuous regard to the principles and objectives of
the Fund; and they shall take all possible measures to uevelop
commercial and financial relations with other member countries
which will facilitate international payments and the maintenance
of exchange stability.
3. The Fund may make representations to any member that
conditions are favorable to withdrawal of particular restric-
tions or for the general abandonment of the restrictions incon-
sistent with IX, 3, above. Not later than three years after
coming into force of the Fund any member still retaining any
restrictions inconsistent with IX, 3 shall consult with the
Fund as to their further retention.
4. In its relations with member countries, the Fund shall
recognize that the transition period is one of change and
adjustment, and in deciding on its attitude to any proposals
presented by members it shall give the member country the
benefit of any reasonable doubt.
Regraded Unclassified
Read by Messrs. White, Bernstein,
57
Smith, O'Connell and Luxford.
April 17, 1944
11:20 a.m.
HMJr:
Hello .
Dean
Acheson:
Yes, Henry.
HMJr:
Hello, Dean. How are you?
A:
Fine, thank you. How are you?
HMJr:
Fine. Dean, you will find a memorandum in there.
I'm trying to get a meeting together tomorrow at
nine 'clock of the various people like yourself,
Paslovsky -- I know that isn't the way to pronounce
his name but.
A:
Yeah.
HMJr:
Jesse Jones and Crowley and Eccles on this before
I go up on the Hill, you see, Thursday. Hello?
A:
Yes, sir.
HMJr:
On this Conference. Now, I'm going to lean very
heavily on you to help me on this thing because --
were you there when Mr. Hull called me?
A:
No, I was not.
HMJr:
Well, somebody went to him and told him that we
were going to hold this thing in July instead of
May and I don't know where he got that misinforma-
tion but I got him straightened out on that. Hello?
A:
Yes. You are going -- you are going to hold it in
May?
HMJr:
Well, what happened -- the time table is this:
I called Hull on the morning of April 3rd at his
home.
A:
Yes.
HMJr:
And spoke to him about the thing and urged him to
talk to the President and evidently you had spoken
to him previously and he was prepared to talk to
the President and did. Hello?
A:
Yes.
Regraded Unclassified
- 2 -
58
HMJr:
The President got on the phone and simply said
to me, "Henry, go ahead and hold it in May."
You see?
A:
Yes.
HMJr:
After having seen Mr. Hull. So, that's what we're
aiming for. And we're moving Heaven and Earth to
get the English and the Russians lined up between
now and Thursday when I go on the Hill.
A:
Yes.
HMJr:
How much success I'm going to have I don't know,
but I've told the English I'm going on the Hill
Thursday, whether they agree or not, but they
practically agreed, you see?
A:
Yes, I saw their cable this morning.
HMJr:
Which 1s encouraging.
A:
Yes.
HMJr:
And I hope sincerely they will and I saw the
Russian Ambassador Friday and I told him I was
going up Thursday and I hoped that they'd agree.
Now the reason we're rushing it = week 1s
because we've got to testify on the Dewey Bill
next week.
A:
Yes.
HMJr:
And the Dewey Bill 18 simply a Republican trick
to try to get something almost like it but not
like it, you seè?
A:
Yes.
HMJr:
Which will have the Republican label.
A:
Yeah.
HMJr:
Now, one thing which I don't lay great importance
to and I don't know how much importance you lay to
1t, but the point 1s that Harry White told me that
in these various discussions somebody at the State
Department said that this meeting should be called
as representative of foreign governments. We had
in mind to follow the same language of the Rio
Conference. Hello?
- 3 -
59
A:
Yes.
HMJr:
When -- I have it before me -- this report in
which it said, here, "The third meeting of the
Minister of Foreign Affairs of the American
Republic recommends: 1. The Governments of the
American Republics participate in a special
conference of Ministers of Finance or their
representatives to be called for the purpose
of considering the establishment of an inter-
national stabilization fund." Hello?
A:
Yes.
HMJr:
Now, if you want to discuss that with me, do
you mind staying behind tomorrow and not throw
it into the open meeting?
A:
I'll be glad to, yes. We have -- we have some
things we want to put up to you on that.
HMJr:
Well, as I say
A:
I will not throw it into the
HMJr:
I think it would be a mistake.
A:
Yeah.
HMJr:
Because we've got troubles enough without
seemingly having differences between State and
Treasury, 80 if there's something along that
line -- if you have some good reasons why you
don't want it that way, if you'd stay behind,
I'd appreciate it.
A:
First rate. I'll be glad to.
HMJr:
And then the other thing: In the -- when I go
on the Hill Thursday, which we've asked for --
Thursday before the Senate in the morning and
in the afternoon, I would very much hope that
you can go with me.
A:
All right, I'll ask Mr. Hull.
HMJr:
I very much hope that you can go with me because
I want this an Administration matter, and the
State and Treasury, we've got to be together on
this.
- 4 -
60
A:
That is the background of our suggestion, that
it should be between Governments, to make it clear.
HMJr:
Well, anyway, when I go -- whenever I go, I'd
very much like you to go along and -- 80 that it
would seem a united front. That's the way I want
it.
A:
Yes. Well, now, may I come back to this "May"
business.
HMJr:
If you please.
A:
Is it your impression that the President is --
is wedded to May as the only time?
HMJr:
I don't know. It's -- there are two things:
The President saw Hull. See? I don't know just
what Hull told him, but he got on the phone and
said to me, this: "Henry," because White's asked
me the same question
A:
Yes.
HMJr:
And he simply said, "Henry, it's all right to
go ahead and call your conference in May."
A:
Yes.
HMJr:
Now, I, at the time, didn't have anything else
in mind but May.
A:
Yes.
HMJr:
Now, what Mr. Hull told him, I gather, after
talking to you -- I don't know, but certainly the
President said, "Go ahead, hold it in May.
A:
Well, I don't know what was said either. I've
never been clear on that.
HMJr:
Well, but
A:
But the questions that we had up
HMJr:
Yes.
A:
and what we hoped that he was going to say is
that the earlier that it could be held, the better.
If it could be held in May, that would be ideal
time.
61
- 5 -
HMJr:
Yes.
A:
If it could not be held in May, then what was
the President's view about holding it after the
Convention.
HMJr:
Yeah. Well, that
A:
He, assumedly, would not wish to hold it during
the Convention.
HMJr:
Yeah. Well, frankly, I don't know. I don't
know what I'd like. to do.
A:
Yes.
HMJr:
And I'd like to leave it this way: if we're not
successful in getting it in May, I'd like to
discuss it with you and with Mr. Hull -- what
would be advisable.
A:
Yes.
HMJrt
But this morning somebody, Hull said, had told
him that we were aiming for July.
A:
Yes.
HMJr:
Well, I've never discussed July. We're moving
Heaven and Earth to get it in May.
A:
Yes. Well
HMJr:
I mean you didn't -- you have no doubts -- you
didn't suspician that We were trying to hold it
in July, did you?
A:
No. No, no. The sole thing that we -- Harry
and everyone talked about with Mr. Hull was the
obvious embarrassment of holding it during the
sessions of the two political conventions.
HMJr:
Yeah.
A:
Which might get somebody excited and they might
put in some planks or make some speeches which
would be embarrassing to those who were conducting
the conference. Therefore, we said, obviously if
the time table is such that it could be held in
May, that would be the ideal time. If, however,
that isn't possible, what would the President think
- 6 -
62
A:
Cont'd:
about holding it later in the summer after the
conventions were over. Would his judgment be
that that would be possible. We all
HMJr:
Well, I
A:
agreed with you that it ought to be held
this year.
HMJr:
Well, we'd have to put it up to him over again
if we're unsuccessful.
A:
Yes.
HMJr:
And I'd like to -- I mean, discuss the thing
very carefully -- if we can't do it in May
whether we want to do it at all.
A:
I see.
HMJr:
I mean, I just don't know. I'd like some advice.
A:
Yes. Well, I will -- I will be there tomorrow
at nine o'clock
HMJr:
Yes.
A:
and bring Leo Pasvolsky and Pete Collado
with me.
HMJr:
Fine. Fine.
A:
And we'll stay afterward and have a talk with
you about this other matter.
HMJr:
If you would, please. Thank you 80 much.
A:
All right, Henry.
HMJr:
Thank you.
63
April 17, 1944
11:37 a.m.
Operator:
Go ahead.
HMJr:
Hello.
Charles
Frey:
Hello. Good morning, Mr. Secretary.
HMJr:
How are you?
F:
All right, thank you. Yourself?
HMJr:
Very well, Mr. Frey.
F:
I'll tell you what we are working on. So far
we have two rooms
HMJr:
Yes.
F:
meaning a bedroom and 8 living room
HMJr:
Yes.
F:
on the Fifty-Fifth Street side.
HMJr:
Yes.
F:
Amd we are working to get a third room. We
won't get it adjoining but We are working to
get it on the same floor.
HMJr:
That's all right.
F:
You see, it's not -- we wouldn't mind disappoint-
ing somebody else, you know, to take care of the
thing. But we, of course, are not going to get
the suite until Friday. Anything else -- do you
think this will be all right?
HMJr:
Well, now, let me -- I don't quite understand --
on the Fifty-fifth Street side you're going to
have what, Mr. Frey?
F:
A two-room suite.
HMJr:
One room 1s a parlor?
F:
A bedroom and a living room.
HMJr:
Now, will that suite have -- the way we had it
in the one -- 1230 -- I mean, two doors to the
Regraded Unclassified
64
- 2 -
F:
No, the living room is a little larger.
HMJr:
Yeah, but has it got two doors to the bath room
so you can get to the bath room from the living
room or not?
F:
No, it wouldn't have that. No.
HMJr:
You've got to go through the bedroom?
F:
Yes. But you see, we are getting another room.
HMJr:
Yes.
F:
A third room, meaning a second bedroom.
HMJr:
Yes.
F:
And trying to get it on the same floor.
HMJr:
Yes. Well, now, let me just think a minute.
Well, what we might want to do is -- we may put --
we could put a cot for one night, 1f necessary,
in that living room, couldn't we?
F:
Yes, of course.
HMJr:
Hello
F:
Yes, certainly, we could do that, Mr. Secretary.
HMJr:
I mean; if necessary just for that one night,
we could put a cot in the living room. Do you
have plenty of cots?
F:
Yes, if you wish us to do that.
HMJr:
Well, as I understand 1t, what you are offering
me for Wednesday night is a bedroom and a parlor?
F:
That's right.
HMJr:
And another room on that floor?
F:
That's right.
HMJr:
Is that right?
F:
That's right.
Regraded Unclassified
- 3 -
65
HMJr:
Well, that will be fine. Hello?
F:
And you'll be arriving on Wednesday.
HMJr:
Some time Wednesday.
F:
Very well, Mr. Secretary.
HMJr:
How the rooms will be arranged I don't know,
but I'll speak to Mrs. Morgenthau and I'll
have somebody phone you tomorrow or Wednesday.
Is that all right?
F:
Very well, sir.
HMJr:
But I can count on a bedroom and a parlor and
another bedroom?
F:
That's right.
HMJr:
For Wednesday afternoon?
F:
Yes, very well.
HMJr:
I'm ever 80 much obliged.
F:
Not at all, Mr. Secretary.
HMJr:
Thank you.
F:
Good bye, sir.
HMJr:
Bye.
66
April 17, 1944
11:42 a.m.
HMJr:
Hello.
Sidney
Weinberg:
Mr. Secretary, this is Sidney Weinberg.
HMJr:
Good morning.
W:
Good morning to you, sir. Say, I talked to
Harry Bowers and Harry Bowers said that he will
advocate it. They've called a special meeting
on Monday.
HMJr:
Yes.
W:
He is going out to Minneapolis to attend it.
HMJr:
Good.
W:
He said it will be up to the Board. He says
there are some reactionaries on that Board
like John Pillsbury
HMJr:
Yeah.
W:
confidentially, who may be opposed to it,
but that he thought that -- he would certainly
throw his influence into it and would -- he
thought it would go through.
HMJr:
Well, I think I have ways of -- of friends who
know John Pillsbury.
W:
Well, he thinks -- he's going -- he's trying
to get John Pillsbury on the wire today himself.
He said, "I'm not sure that he will do it but,
he said, "John is one of those fellows that's
anti-everything" and he thought he could swing
him, but he said he just wanted to be -- wanted
you to know the fact that he 18 a little
reactionary, but that he thought he could swing
it.
HMJr:
Well, if he can't, will you send me a wire?
W:
I'll -- yes -- I'll ask him to communicate with
you direct from Minneapolis on Monday if there's
any problem.
HMJr:
That will be a little -- I thought you said he
was going to talk to him.
67
- 2 -
V:
Yes, he's going to talk with him today. Yes.
Unless you hear from me to the contrary, you'll
know it's all right, because he's calling the
whole Board himself.
H/Jr:
Wonderful. Now
V:
In Minneapolis.
HMJr:
Well, if -- he's doing that today?
V:
He's doing that today.
HMJr:
Well, now, if he has any troubles, let me know
because we have -- the Treasury has some friends
there that are very influential on the War Bonds.
You see?
V:
Right.
HMJr:
We have some of the leading financial people
there.
V:
Right.
FMJr:
And who I'm sure would go to bat for us.
1/:
Well, he -- he doesn't -- he doesn't invision
any difficulties but he said -- we know John
Pillsbury very well ourselves. We are bankers
for his company but he's kind of anti-administra-
tion and everything comes up, he and Jim Bell,
out there, are always against everything.
MJr:
You mean to say that people are against the
Administration?
N:
(Laughs) I hope you are realistic enough to
know there are some people like that.
HMJr:
Well, well, well.
V:
(Laughs)
HMJr:
How times have changed! (Laughs)
11:
(Laughs) Well, anyway....
MJr:
Yeah.
Regraded Unclassified
68
- 3 -
W:
we'll do everything
HMJr:
All right.
W:
that we can. We've talked to the man --
to Olrich -- twice
HMJr:
Fine.
W:
on it. Harry Bowers talked to him on
Sunday.
HMJr:
Yeah.
V:
And We talked to him again this morning and
we think we've got it set. Unless you hear
from me to the contrary, why, you'll know it's
gone through.
HMJr:
Fine. Now, when you come down, I think that's
worthy of treating you to lunch in the Treasury.
W:
Well, that will be wonderful.
HMJr:
You tell the
W:
I'll be delighted to do it. I'm coming down
probably to see Will Clayton a week from
tomorrow and I'll certainly give you & ring.
I know how busy you are and I'm not going to
bother
HMJr:
Now, wait a minute. If you are coming down
and you know it, let me know a day or two in
advance, so I can hold lunch.
W:
Well, that will be fine.
HMJr:
Just send me a wire a couple of days in advance.
W:
I appreciate that very much
HMJr:
Because I
W:
and I'll take advantage of it.
HMJr:
I really mean it because the restaurants are
crowded and this will give you a place to rest
your feet.
- 4 -
69
W:
Well, that will be fine. I appreciate that,
Mr. Secretary.
HMJr:
Okay.
W:
Thank you. Call on me any time. I'm glad to
help.
HMJr:
You call -- I call on you and I'll feed you.
W:
Okay.
HMJr:
All right.
W:
Thank you, sir.
HMJr:
Bye.
W:
Bye.
70
April 17, 1944
12:30 p.m.
APPEARANCE BEFORE CONGRESSIONAL COMMITTEES
Present: Mr. O'Connell
MR. O'CONNELL: I talked to Senator Barkley, and he
was, I thought, quite receptive to the whole plan. He did
want to know if we could make it Friday. He was speaking
of himself; he will not be here Wednesday or Thursday.
I left it open. I told him I was going to speak to
Rayburn at two-thirty. He definitely preferred Thursday,
80 he is going to talk to George, Connally, and Wagner
in the meantime, and I am to see him again immediately on
talking to Rayburn. My impression is that we just thought
Thursday would be the best day, but we didn't rule out
completely Friday, did we?
H.M.JR: No, it makes a little difference, personally,
but--
MR. O'CONNELL: He didn't make too much of a point of
it.
H.M.JR: Well, let's see.
MR. O'CONNELL: It may be that Thursday will be as
palatable to the others.
H.M.JR: Will Barkley be there?
MR. O'CONNELL: He cannot be there either Wednesday
or Thursday.
H.M.JR: It is pretty important to have him there.
MR. O'CONNELL: Well, he just can't be. He says
he is leaving town tomorrow and will be gone Wednesday
and Thursday. Of course, he couldn't be at your preliminary
Regraded Unclassified
71
- 2 -
meeting with the Chairman of the Committee in either
event, because that would have to be the day before.
H.M.JR: He is funny, though. You don't know whether
the House makes any difference or not.
MR. O'CONNELL: I don't know. I can't see Rayburn
until two-thirty. There is another complication that may
arise in connection with Wagner's Committee activities,
because his Committee is holding hearings on the OPA
legislation, and they have already been postponed a couple
of times.
H.M.JR: Well, I have to suit my own personal plans
to the Hill, that is all.
MR. O'CONNELL: I think it is an odds-on bet for
Thursday, without Barkley. But it is still kind of
open. I wanted to be sure if we had to do it that way
it could be Friday.
H.M.JR: That is all right.
Regraded Unclassified
72
April 17, 1944
12:56 p.m.
HMJr:
Hello.
Operator:
Admiral Land.
HMJr:
Hello.
Admiral
Land:
Yes.
HMJr:
Hello, Jerry, this is Henry talking.
L:
Yes, sir.
HMJr:
How are you?
L:
Fine, thank you.
HMJr:
Look, could you this afternoon see John
Pahle, the Director of the President's Refugee
Board in regard to steamer -- passenger steamer
to Turkey?
L:
Yes.
HMJr:
What time could you see him?
L:
Well, about four o'clock.
HMJr:
Four o'clock?
L:
Yeah.
HMJr:
He's got with him Ira Hirschmann who is just
back from Ankara.
L:
Yes.
HMJr:
And we're going to ask you a favor to help us
get some of those people out.
L:
Yeah.
HMJr:
So I hope
L:
I'll be glad to go into it. I know a little
bit about the high spots. Who's -- who's with
him? Who's with Pehle?
HMJr:
A man by the name of Ira Hirschmann.
Regraded Unclassified
73
- 2 -
1:
Yeah.
HMJr:
Who is just back from Ankara.
L:
All right.
HMJr:
And then he's going to talk to you about
Lieutenant Commander Becker, We'd kind of
like to send him to London if we could.
L:
What for?
HMJr:
For the War Refugee Board.
L:
Well, now, listen, I've got too small a staff
to spill out anybody like that here. Everybody's
picking on this poor organization here, including
the Army and the Navy and I've tried to get some
help from them and they turned me down.
HMJr:
Yeah.
L:
I've just sent a Captain over there to help the
Navy
HMJr:
Yeah.
L:
which is rather amusing here in view of the
fact that we've got about one percent as many as
the Navy and about a tenth of one percent as the
Army.
HMJr:
Yeah.
L:
I don't -- I doubt very much -- I'm perfectly
willing to talk about it, but Becker is filling
a job here that, to my mind, is
HMJr:
Well
L:
vitally -- very vital to our organization.
HMJr:
Well, let Pehle tell you about it anyway.
L:
Yeah, I will.
HMJr:
Thank you very much.
L:
I don't want to give Pehle -- I'm perfectly
willing to work out the ship
Regraded Unclassified
74
-- 3 -
HMJr:
Yeah.
L:
but I'm too shy of personnel to give much
advance encouragement to that. However, I'll
be glad to listen to him.
HMJr:
Well, I think he's more interested in the ship
than he is in Becker.
L:
Yeah.
HMJr:
Yeah.
L:
Okay.
HMJr:
Thank you.
L:
Thank you.
75
April 17, 1944
2:36 p.m.
HMJr:
Hello.
Operator:
Mr. Sullivan is up on the Hill.
HMJr:
Well, get me Clifton Mack, please.
2:27 p.m.
HMJr:
Hello.
Operator:
Mrs. Morgenthau 1s calling you. Do you want
to take it first?
2:38 p.m.
HMJr:
Hello.
Clifton
Mack:
Hello.
HMJr:
Mack?
M:
Yes, sir.
HMJr:
I'm sending you back a memorandum which came to
me direct from John Loeb.
M:
Yes.
HMJr:
Now, I've -- John Loeb came to work for you
without my knowledge and there's no reason
why John Loeb should write any letters directly
to me.
M:
Yes, I didn't know that there was such a letter.
HMJr:
Well....
M:
I
HMJr:
I'm going to send it back and he makes
certain statementsthat I have no way of knowing
about. This -- he wants us to let the passenger
cars go to the tax-supported institutions.
M:
I see.
Regraded Unclassified
76
- 2 -
HMJr:
And there are certain statements that he makes
and I have no way of knowing whether they are
correct or not about getting more money and
there being more -- that there are more cars
now that -- than O.P.A. knows what to do with.
M:
Yes.
HMJr:
Which I greatly doubt.
M:
Yes. Well
HMJr:
I mean, I don't want this on my desk in a sense.
I don't know whether he's trying to make a record
or what.
M:
Yes, well, I talked to him the other day.
HMJr:
Yeah.
M:
And told him that if he had anything to go to
Treasury, I wanted it to come through me.
HMJr:
Well, it doesn't please me at all.
M:
Well -- well, I'm sorry that he did that.
HMJr:
After all, if he's sending something to me, he's
presuming on his relationship.
M:
Yes.
HMJr:
And after all, he's over there on his own, or
should be.
M:
Yes. Well, all right, then. I didn't know about
that.
HMJr:
Well, you know it now and you can tell him I'm
not at all pleased and -- but I don't -- you'll
have to answer these things because I don't know
whether they're 80 or not.
M:
Yes, well, I'll -- I will find out what he has to
say. Of course, it's like all of these things.
HMJr:
Yes.
M:
There are a good many pointe to them.
HMJr:
Yeah. Well
Regraded Unclassified
77
- 3 -
M:
It's a question of the -- of judgment -- what
1s the best thing to do.
HMJr:
Sure. And -- well anyway
M:
I'll go over them with him.
HMJr:
I've made up my mind, but there's. certain --
8.8 I say, I know that there are not enough care
for munition workers
M:
Yes.
HMJr:
to go around.
M:
Yes, well
HMJr:
What did you find out about those nine hundred
cars that R.F.C. has?
M:
Well, I found out that they have cars but
apparently they are not moving very fast.
HMJr:
Yeah.
M:
And then -- then we got into it with O.P.A. to
find out about -- about price ceilings if we
sell these cars to dealers and 80 on.
HMJr:
Yes.
M:
And that's when the question came up about --
about price ceilings that wouldn't be quite as
high as for tax-supported organizations.
HMJr:
Yes.
M:
However, I talked to John Sullivan about it this
morning, and we -- we're getting that additional
information 80 it will be available.
HMJr:
Well, O.P.A.'s regulations may be too strict.
M:
Well, that may be. They -- they take the point
that the -- if we sell to dealers, we're selling
wholesale, and so forth. Nevertheless, I'll get
all of the information on each one of these points
so it will be specific.
Regraded Unclassified
78
- 4 -
HMJr:
Well, I'm sending it back and please tell him
that we have an organization; you're his superior
and if he wants to communicate with me, he should
do it through you.
M:
Yes, sir.
HMJr:
I'm not answering him. I'm just sending it back
to you.
M:
All right.
HMJr:
Thank you.
M:
Good.
For C. mark- 79
for his comment
Omy Sent to Mr. Marb.
April 17, 1944
4/17/21
MEMORANDUM TO THE SECRETARY
Not having had the opportunity of discussing the
matter with you, I an taking the liberty of listing below
certain reasons, which may not have been presented to you,
for selling passenger cars to Tax-Supported Institutions.
1. The entire available stock of 1942 cars, in-
cluding those held by us, are under the rationing control
of the OPA.
2. The Federal Agencies and Tax-Supported groups
who receive cars from us are high on the OPA eligibility
list, and if we do net transfer or sell to them they would
obtain cars direct from the OPA Dealer Pool.
8. Cars, which are no longer new, are filling a
demand which would otherwise have to be satisfied with new
cars.
4. As the ears are in many cases in poor shape and
deterioration has set in, from a conservation standpoint,
the sooner they are put to use the better.
5. If sold to dealers these cars would undoubtedly
remain unsold longest as they are the least desirable.
6. Sales to Tax-Supported Institutions for immediate
delivery would avoid the double handling and double storage
involved in selling to dealers.
7. Sales to dealers would probably net some $300.00
less per car, as - would have to allow them the usual
dissount from the retail price.
Regraded Unclassified
80
- 2 -
8. Sales to Tax-Supported Institutions on the other
hand will recover original cost and expenses.
9. Assuming sales to dealers, imagine the mechanical
difficulties, the scramble, confusion and possible ill will
which would result from trying to allot a few hundred or a
few thousand cars to over 30,000 dealers. For this reason
our method has the backing of the trade.
10. Sales to Tax-Supported Institutions make more and
better cars in the regular OPA pool available for other
essential users including workers in critical industries.
For your information the OPA believes that they are in
a position to take care of all urgent needs during the next
twelve to fourteen months, after which they anticipate some
new car production.
John L. Loeb
JLLoeb:J
Regraded Unclassified
81
April 17, 1944
3:55 p.m.
APPEARANCE BEFORE CONGRESSIONAL COMMITTEES
Present: Mr. O'Connell
Mr. White
Mr. Smith
Mr. Bernstein
Mr. Luxford
MR. WHITE: Dean Acheson had called a meeting several
hours ago for four o'clock in his office, at which Crowley
was to be present and, I think he said, Jones, to discuss
the coming hearings on the Dewey Bill. I said we would
be there.
Now, if you could call up and tell them that you are
holding this--
H.M.JR:z When you say "we," who is that?
MR. WHITE: Luxford, Bernstein, and I.
H.M.JR: You can't all go. On the Dewey Bill?
MR. WHITE: Yes, and they are raising the question
of requesting new powers to increase the resources of the
Export-Import Bank.
H.M.JR: Does Bernstein ever go to these meetings
over there?
MR. WHITE: Oh, yes.
H.M.JR: Let Bernstein go, and you tell her--I will
tell them--
MR. WHITE: Yes, will you tell them please?
Regraded Unclassified
82
- 2 -
MR. WHITE: (To Bernstein) Go ahead. Do nothing,
and fight everything!
They are not very sympathetic with this bank, and this
is all maneuvering that is going on, one way or another.
H.M.JR: Have you any friends outside the Treasury,
Harry, on this thing?
MR. WHITE: Oh, yes.
H.M.JR: Would you give me a list?
MR. WHITE: Well, practically all of the technicians.
Wouldn't you say so?
MR. LUXFORD: Yes.
MR. WHITE: Officials--even technicians in the State
Department, but they don't happen to be Collado, Pasvolsky,
and Warren Pierson. Pierson is interested in the Export-
Import Bank, and anything that interferes with that is
suspect.
H.M.JR: Now, where are we?
MR. WHITE: You know about the arrangements of the
Committee meeting. I just heard about it, 80 I suppose
you know more about it than I do.
H.M.JR: No.
MR. WHITE: Joe O'Connell had better report to you,
then.
MR. LUXFORD: About half an hour ago they told him
there were conflicting dates about Thursday and Friday,
but he would have it straightened out.
MR. WHITE: Here is a cable which is your answer
to the Chancellor of the Exchequer.
H.M.JR: My answer? Has it gone?
Regraded Unclassified
83
- 3 -
MR. WHITE: This is it.
H.M.JR: Has it gone?
MR. WHITE: Not yet, no.
(Hands the Secretary attached cable to Winant.)
H.M.JR: I haven't had anything to do today!
Is this fixed now, Friday, April 21?
MR. LUXFORD: No, that is the uncertainty.
H.M.JR: Do I have to read this whole thing?
MR. WHITE: I think the second page, yes.
H.M.JR: Beginning with three.
MR. LUXFORD: Yes.
(Mr. White hands the Secretary a new coin minted for
the French.)
Mr. O'Connell enters the conference.)
H.M.JR: I have just been tipped! Shall I keep this?
MR. WHITE: Yes.
H.M.JR: It is heavy.
MR. WHITE: Yes, it is a nice coin. It is two or
four cents.
H.M.JR: Same as our pennies, the same material?
MR. WHITE: I don't think so.
H.M.JR: Oh, you have gone into "Liberty, Equality,
and Fraternity," and General DeGaulle.
Regraded Unclassified
84
- 4 -
MR. WHITE: In a big way.
H.M.JR: To digress a minute, boy! we always pick a
loser, don't we? You no sooner back Badoglio than he
quits.
MR. WHITE: Apparently that is the way to get people
in power, pick the other guy.
H.M.JR: We told them when we were out in Algiers--
I told them, certainly, I was "agin"--
MR. WHITE: And subsequent to that, we got information
which was very definite that DeGaulle is out and Giraud
was on top, and there was no need of concerning ourselves
any more with DeGaulle. This was about four or five
months ago.
H.M.JR: Well, it is just putting a gun to their
head again, isn't it?
MR. LUXFORD: Kind of.
H.M.JR: It is all right.
MR. WHITE: It is the only way of getting results.
They will be angry, but--they held this thing up, the bank
part, for six months. They refused to discuss it with us.
H.M.JR: All right.
MR. WHITE: Now, the one thing we are uncertain of is
the day.
H.M.JR: Joseph, give a report.
MR. O'CONNELL: From the Senate point of view it
has to be Friday. Before I went to see Barkley the second
time, I saw Rayburn, and he had already arranged something
for Thursday afternoon before I could stop him. I went
back to see him after talking with Barkley.
Regraded Unclassified
85
- 5 -
The reason the Senate can't meet Thursday is, number
one, Barkley won't be there; number two, the Senate
Foreign Relations Committee has a hearing scheduled for
Thursday morning which Connally doesn't want to change.
Wagner had meetings scheduled with OPA every day this week.
But they are both agreeable to Friday morning at ten-
thirty.
H.M.JR: You are talking of the Senate?
MR. O'CONNELL: Friday morning at ten-thirty in the
Senate in the Banking Committee Room.
George is out of town and will probably not be back
for that meeting, but Barkley took the bull by the--
Barkley took the reins and called the Committee.
H.M.JR: Took the bull by the--! I just wondered--
MR. WHITE: And looked him right in the face!
(Laughter)
H.M.JR: Joe said he took the bull by the--
MR. O'CONNELL: Well, I had to recollect myself, but
it is all set for Friday at ten-thirty. George probably
will not be there, but his Committee will be.
H.M.JR: Are you going to send George a wire?
MR. O'CONNELL: Barkley told the Post-War Committee
people to let George know.
H.M.JR: I would call up George's secretary up there,
who is 8 very smart girl, and tell her I want him to know
this. What is her name?
MR. LUXFORD: Ask Pehle.
MR. O'CONNELL: I will take care of that. I don't
think he talked with George's office, but the Post-War
Planning group. It is set in the Senate.
Regraded Unclassified
86
- 6 -
I went back to see Rayburn. Rayburn was a little
upset because he thought the Senate had decided it would
be held Friday, and he had decided it was going to be
Thursday afternoon, but said he would call me later this
afternoon. He indicated there wouldn't be any difficulty
about arranging Friday afternoon in the House, but I
have to wait until I hear from him before it can be
arranged. While I was with him the first time, he called
Spence, and it was agreeable to Spence.
When I left him, he was going to speak to Bloom,
Colmer, and Andy Somers.
But, as I said, he spoke to Spence about Thursday,
and he is now going to change it to Friday.
H.M.JR: Friday afternoon?
MR. O'CONNELL: Yes, he is to call me late this
afternoon.
Now, it can't be Thursday.
MR. WHITE: Therefore, the date must be Friday.
MR. O'CONNELL: It must be Friday.
MR. WHITE: The release will be Saturday.
MR. O'CONNELL: I think it is entirely in Rayburn's
control, and he could have said as easily Friday as he
said Thursday the first time. But he wanted to know
why I had to pay any attention to the Senate, and Barkley
wanted to know whether Rayburn was insisting on Thursday,
and whether he knew that he, Barkley, was going to be out
of town. It sounded to me like the two Houses--
H.M.JR: I told you it was a little important with
Barkley.
MR. O'CONNELL: I know. It was more important to
Rayburn, it seemed to me, than I would have thought, but
I am confident he will go ahead and do on Friday what he
started to do Thursday, and call me late this afternoon.
Regraded Unclassified
87
- 7 -
H.M.JR: You have to hold this cable up, because it
won't get there until in the morning, anyway.
MR. WHITE: Well, in any case--
H.M.JR: I mean about the release and all that.
MR. WHITE: The release will have to be Saturday, in
any case, because you are seeing the Senate on Friday.
The most that can happen is that you have to see the others
Thursday afternoon.
MR. O'CONNELL: There is one more thing.
MR. WHITE: We are glad for the extra day if it is the
same for you.
H.M.JR: It is very inconvenient for me, but, 88 I told
Joe, disregard my own personal arrangements.
MR. O'CONNELL: There just couldn't have been anything
anything done on Thursday.
H.M.JR: I have to rearrange all my plans.
MR. O'CONNELL: You couldn't have gotten to first base
with the Senate.
H.M.JR: That is all right. I said to make the deal
and disregard what I have.
MR. O'CONNELL: Now, one thing that isn't finally
buttoned up is whether you will meet with the Chairmen of
the Committees the day before, on Thursday. I mentioned
that both to Barkley and Rayburn, and Rayburn was very
willing to have you meet with the Chairman of his Committee
and McCormack in his office the afternoon before. Barkley
was more or less noncommittal the first time, although he
thought it was a good idea. But after Rayburn indicated
he would be willing to call the group of the House Committee
Chairmen together, but sort of brushed aside the suggestion
it should be joint House and Senate, I thought I wouldn't
mention it to Barkley when I went back since neither George
nor Barkley will be here on Thursday. So you can either meet
with the House Chairmen on Thursday afternoon, or just have
the full meeting. You can't meet with the Senate Chairmen
beforehand, because they aren't here.
Regraded Unclassified
88
- 8 -
H.M.JR: I have a suggestion to make. Let's meet with
the House Thursday afternoon, and then with the Senate
Chairmen, see them at ten o'clock Friday morning.
MR. O'CONNELL: Fine.
MR. SMITH: The only trouble with that is that the
Republicans will have over night to find out what you
are saying and will be ready for you in the Senate Friday
morning.
H.M.JR: How - if I see the Democrats?
MR. O'CONNELL: These are ail Democrats he is seeing.
MR. SMITH: Oh, oh, excuse me.
H.M.JR: Organization Democrats.
MR. SMITH: Excuse me, sir. Yes,sir. I am sorry,
sir. I could eat my tongue out!
MR. O'CONNELL: If and when Barkley calls and it is
set, then you would be agreeable to Thursday afternoon
in Rayburn's office with the Chairmen and McCormack?
H.M.JR: And ten o'clock Friday morning with the
Senate group.
MR. O'CONNELL: Right. I will speak to Barkley about
that, then, after I have cleared everything up with
Rayburn. That is the one thing to keep our fingers
crossed about. The Senate group would be Barkley,
Connally, and Wagner, because George won't be there unless
he changes his mind.
H.M.JR: Well, it sounds as though you did a good
day's work.
MR. O'CONNELL: Well, thank you. we will know more
when the returns are in from Rayburn. I shouldn't have
mentioned to Rayburn that I had even seen Barkley at all.
I shouldn't have made them both believe I had seen them
first. We live and learn.
H.M.JR: Now, what else?
89
- 9 -
MR. WHITE: Well, we had a meeting this morning.
H.M.JR: Excuse me. Have you read my conversation
with Hull and Acheson?
MR. WHITE: Yes, I read them both.
H.M.JR: You (O'Connell) ought to read them, too.
MR. O'CONNELL: I was starting to when I was called
in here.
MR. SMITH: I have.
MR. LUXFORD: Not yet.
H.M.JR: Wasn't that thing with Hull peculiar?
MR. WHITE: Yes. I don't quite make it out.
H.M.JR: Did you notice the way I pinned Acheson
down, whether he misunderstood about the July date - to
eliminate him?
MR. WHITE: Yes, it sounded as though it was Acheson.
H.M.JR: No, no, no. Acheson said he didn't mis-
understand.
MR. WHITE: It wasn't clear from that conversation
who told Hull.
H.M.JR: I don't think there is any question. It
is Pasvolsky.
MR. WHITE: We had this meeting with the American
Technical Committee in which we cleared with them the
general principies on the Bank. They may get a little
feeling we are pushing them, but--
MR. LUXFORD: That, or being railroaded. I don't
know which it was.
SO
- 10 -
MR. WHITE: And that is all. The rest of the things -
we are going forward on the various cables.
H.M.JR: Well, do I have an agenda for tomorrow
morning?
MR. WHITE: I will see that you have an agenda. (Attached)
Here is this. (Hands Secretary proposed letter to
Secretary Hull, re: Central Bank for Saudi Arabia.)
I don't understand. We have been disucssing the Bank
and this monetary system in Saudi Arabia. There has
always been present two or three State Department men,
and they have had copies of whatever we have been pre-
paring.
H.M.JR: You don't think this should go.
MR. WHITE: Oh, I didn't intend it that way.
H.M.JR: See how this sounds: "Members of the
Treasury Staff have already consulted members of the
State Department," and 80 forth - "copies of which
were presented," and so forth.
He is asking me to send & copy as though it is some-
thing quite new.
MR. LUXFORD: No, what he asked for was an American
version, whereas - wasn't that a joint version?
MR. WHITE: This is an American version, which we
had discussed with the british.
Let me read it over with that in mind.
H.M.JR: It is a little bit rubbing his nose in it.
MR. WHITE: It isn't that important, to rub his
nose in.
Regraded Unclassified
91
- 11 -
H.M.JR: Don't let's rub it in, then. The old man
over there, he isn't told what is going on. Somebody
writes a letter and he doesn't know it. He signs it.
Bring it in tomorrow, will you?
Now, what else?
MR. WHITE: That is all.
H.M.JR: You can still go over to your meeting with
Acheson if you want to.
MR.WHITE: I have an excuse not to, 80 if you
don't mind, I am not going.
H.M.JR: I have got to do & couple of things.
I want to talk to you (O'Conneil), a minute, and
I would like Luxford to wait outside.
I am through with you (Smith).
I will take Harry out in the corridor a minute.
92
MOST URGENT - HIGHEST PRIORITY
Please send the following cable to the American Embassy,
London.
"To Winant from Secretary Morgenthaus
"I an vary grateful to you for the prompt reply from the
Chancellor of the Exchaquer.
"Please give this message to the Chancellor of the Exchequer.
"1. I wish to express w thanks to the Chancellor of the Exchaquer
for his message of April 15.
"2. At the request of the Congressional leaders, my appearance
before the appropriate Congressional committeds has been postponed to
Friday, April 21. In consequence of this modification, we shall release
the Joint Statement to the press at 8g00 p.m. April 21, Washington time.
"In accordance with previous arrangements with Opio - have asked
Moscow and Chungking, as well as some of the American Republics to
join in the publication of the Joint Statement. We are also sending
a summary, but not the text of the Joint Statement, to all of the
American Republics with whom W have consulted.
"We assume you will make similar arrangements for informing the
Dominions and governments in London and Cairo 'prior to publication,
and to arrange, if possible, for similtansous publication or announce-
rente by some of these countries.
"No have discussed with Opio the issuance of an explanatory state-
ment to the press at the time the text of the Joint Statement 10 released.
de will inform you of our general agreement with the statement you
suggest and with the slight modification we propose. It is my under-
standing that the explanatory statements issued in Washington and
London will not be presisely the Bame in language although they will
convey the same meaning.
"Mr. White and Mr. Opio have examined in detail the arrongement
previously agreed upon for steps following the publication of the
Joint Statement on the Fund. w Mr. Opie will have informed you, it
has long been clearly understood that after the publication of the
Joint Statement on the Fund there would be opportunity for debate in
Parliament. Promptly after the conclusion of the debates, - will
Regraded Unclassified
93
- 2 -
raise with you the immediate issuance of invitations to a confer-
once of the United and Associated Nations on the establishment of
international agencies for postmar financial cooperation. As I have
previously explained, a prospt decision on this matter would make it
possible for us to hold a formal conference at the end of May in
accordance with the preference expressed by the President.
"3. The have transmitted to Winant the text of a proposed Joint
Statement on the establishment of 4 Bank for Reconstruction and
Development with the request that he furnish it to you. The Joint
Statement is confined to an exposition of those principles which
should govern a Bank for Reconstruction and Development on which we
feel there could be no disagreement anong the technical experts.
"Mr. White told Mr. Opio this norning that when I appear before
the Congressional committees on Friday I will be compelled to report
to then on the results of the technical discussions on the Bank for
Reconstruction and Development. Obviously, I would like to be able
to report that the experts of the United States and the United
Kingdom are in agreement on a statement of principles on the estab-
lishment of the Bank, and at the SIZE time make the statement avail-
able to the Congressional committees. I an not unwindful of the
short notice you have received on this propesal. If your experts
cannot indicate their agreement at once, but feel that agreement
might be reached on a statement if postponed for a week, I could
inform the Congressional committees that the technical experts of the
United States and the United Kingdom have cose to a large measure of
agreement and hope to issue a Joint statement of principles within
another week.
"On the other hand if it should not sees feasible to the experts
of the United Kingdom to join with the experts of the United States in
issuing a Joint Statement on the Bank within the next week or 00, I
shall explain frankly to the Congressional committees that there has
not been opportunity to reach agreement with the technical experts of
all of the countries. I will them release this statement on the
establishment of a Bank for Reconstruction and Development as repre-
senting the views of the technical experts of the United States and
having the approval of the experts of a number of other countries, but
not including the United Kingdom. I shall, of course, add that it is
my hope that after further study the experts of the United Kingdom will
see their way clear to join in subscribing to this statement of
principles.
"As I must males arrangements immediately on the material to be
presented to the Congressional committees, I should appreciate 4
prompt reply indicating which of these courses on the Bank you would
prefer. I hope you will understand that the urgeney for a decision
is one forced upon as by circumstances.
EMB:AFLish
4/17/44
Regraded Unclassified
94
Agenda for meeting in Secretary Morgenthau's office
April 18, 9:00 a.m.
1. President's wishes on the conference date.
2. Status of discussions on the Fund with Chinese, Russians and
British.
3. Proposal to appear before Senate Committecs: Foreign Relations,
Banking and Currency, Special Committee on Post-War Economic
Policy; and before House Committees: Foreign Affairs, Ways and
Means, Banking and Currency, Coinage, Weights and Measures,
Colmer Committee on Post-War Economic Policy.
4. Proposal to publish Joint Statement on the Fund in Washington,
London, Chungking and perhaps Hoscorr, as well as several other
capitals.
5. Status with respect to a Joint Statement on the Bank.
6. Next steps toward a conference.
7. Beeting of the technical representatives of China, U.S.S.N.,
0. K. and U. S.
8. Possible location for a conference. Whether in U. S. or in a
foreign country.
9. Selection of countries to be represented on drafting committee.
Regraded Unclassified
95
April 17, 1944
4:37 p.m.
HMJr:
Hello.
Operator:
Here's Mr. Bell. Go ahead.
Charles S.
3611:
Hello, sir.
HMJr:
Charlie.
B:
Yes, sir.
HJr:
Make a note for the record that when Joe
O'Connell becomes full-fledged General
Counsel
B:
Yes, sir.
HVJr:
Luxford will be second
B:
I 880.
HMJr:
which means that when Joe 5088 out of town,
Luxford will be Acting.
B:
Yes, sir,
HXJr:
This is in the form of E memorandum from
me to you.
B:
All right, sir.
HMJr:
Joe O'Connell knowe about it and I've told Luxford.
B:
All right, sir. I'll take care of it.
MJp:
Thank you.
B:
Righto.
Regraded Unclassified
96
April 17, 1944
4:48 p.m.
HMJr:
Hello.
Operator:
I have Chairman Eccles.
HMJr:
All right.
Operator:
There you are.
HMJr:
Hello.
Chairman
Ecoles:
Oh, Henry.
HMJr:
Yes, Marriner.
E:
About that meeting in the morning.
HMJr:
Yes.
E:
What -- what's it about?
HMJr:
Well, gosh, Goldenweiser ought to know.
E:
Well, yeah. Well, what I meant is -- he -- this
is on a technical level, isn't it?
HMJr:
No, this is on the level of you and me, to tell --
inform you people and get your advice before I go
up on the Hill Thursday and Friday. I mean,
Crowley's coming and Acheson is coming and Jesse
Jones is coming and each are bringing their -- the
fellows who have been on the technical level.
E:
Yeah.
HMJr:
But the principals are coming.
E:
Yeah. Well, all I wanted to say 18 that so far
as I am concerned and the Board and the Open
Market Committee, too, because they're interested
likewise in this thing.
HMJr:
Yes.
E:
That it's been on a technical level and we've
never put it on any other basis because we didn't
know that you or the other agencies had.
HMJr:
Yes.
97
- 2 -
E:
The last time that I met was some time ago, as
you recall, with you.
HMJr:
Yes.
E:
And you said at the time that the whole thing
was on 8. technical basis.
HMJr:
Yeah.
E:
And now, I'm not in a position to -- I can come
over and sit in but I'm not in a position to make
any commitments of any kind.
HMJr:
Well
is
Now, I didn't know whether you wanted me to come
over on that basis or not.
HMJr:
I'd like very much to have you come over and --
for instance, Crowley 1s bringing four men with
him.
E:
Well, I'll bring Goldenweiser and Gardner who
have been, of course, meeting and sitting in on
this thing without -- on a technical level, and
of course, have had no authority to commit anybody.
HMJr:
That's right.
is)
They have been merely advising and working with
White.
HMJr:
Yes.
E:
Now, I'll bring them over but I just wanted you
to know -- I wanted to say this to you before I
came 80 that if you wanted me to come just 8.8
an observer and not being able to commit anybody,
I'll be glad to come.
HMJr:
Well, I'd like you to come but 8.8 I gather from
White -- I may be wrong -- that Goldenweiser --
well, maybe I'd better not say -- what I've been --
why not say, I got the impression that Goldenweiser
has been trying to get a commitment from his superiors
and has been unable to do 80.
E:
That's correct.
98
- 3 -
HMJr:
See?
E:
That's correct. He -- Goldenweiser has been
talking to us more or less -- he's brought the
matter up several times and -- but the Board
has never gotten together and gotten down to
the position of considering this thing so they
could make a commitment.
HMJr:
Well, now
E:
It is an involved question, as you know.
HMJr:
Yeah, but now we're going to move and
E:
And what I'd like to do -- I think that before
the commitment 18 made, it ought to be really
made with a system. That's going to take some
time.
HMJr:
Well, you're not going to have much time.
E:
Well, then we just won't make a commitment.
We'll have to be free.
HMJr:
Yeah. Well, you've had all the time in the
world.
E:
Well, have, yes. We have in a way, but the
last time I talked to you, you -- you took the
position that the whole thing was on a technical
basis and you weren't prepared to make a commit-
ment.
HMJr:
Well, what I gathered, as I say, I hate to be
quoting somebody who quotes somebody else, but
I got the impression from Harry who gets it from
Goldenweiser that he, Goldenweiser, has been
ready to recommend -- that he and White are together,
but that he has been unable to get his superiors to
give him any authority.
E:
Yeah. Well, I think that's correct.
HMJr:
And 80, the reason there is a rush, Marriner --
I'm not trying to rush anybody -- but I'm being
rushed by Congressman Dewey and I've got to move
before he does.
E:
Well, the thing to do is just refuse to go up and
- 4 -
99
HMJr:
I can't.
E:
And if Dewey wants you to testify.
HMJr:
No, it's next week.
E:
I know, but Dewey -- Dewey 18 going to want us
to testify, too, and all I propose to do is just
refuse to testify.
HMJr:
Well, look, come over in as cooperative a frame
of mind as you can. Will you, old man?
E:
Yeah. Well, I'll come over and I'll bring the
staff, but I just don't want to be put on the
spot.
HMJr:
I won't put you on the spot.
E:
To make any commitments. See?
HMJr:
I won't put you on the spot.
E:
Because, after all, you speak for yourself and
Jesse speaks for himself and Crowley for himself
and, hell, I've got about twelve people.
HMJr:
I know.
E:
And it's entirely a different problem.
HMJr:
It's very difficult.
E:
I'll say it's difficult. So I just don't want to
come over and be put
HMJr:
I will treat you as my most honored guest.
E:
Yeah? Okay, I'll be over there, then, Henry.
HMJr:
Thank you.
E:
I'll bring Goldenweiser and Gardner.
HMJr:
That will be entirely agreeable.
E:
Okay.
100
April 17, 1944
4:57 p.m.
HMJr:
Yes.
Operator:
Go ahead.
HMJr:
Hello.
Speaker
Reyburn:
Henry.
HMJr:
Yes, Sam.
R:
How much do you like me and Wright Patman
anyhow?
HMJr:
What's that?
R:
How well do you like Wright Patman and me?
HMJr:
I love you both.
R:
Well, that fixes it up all right, then. We
want you to make a speech down in Texarkana on
the 12th of June.
HMJr:
(Laughs) What do the boys -- the cow boys say?
R:
You're asking -- you're asking us for a lot of
money down there, you ought to show yourself.
HMJr:
What do you boys say? "Ride 'em, cowboy,
whoopee!"
R:
That's right.
HMJr:
Is that the way you yell?
R:
That's right and get on the radio where it will
extend over into my district
....
HMJr:
Yeah.
R:
....
and say a few kind words about me.
HMJr:
I see.
R:
It might be helpful. You can't tell.
HMJr:
I see.
- 2 -
101
R:
I hope you do consider that seriously, Henry.
HMJr:
Well, my God, to get a few more Texas cowboys
with spurs, what am I going to do?
R:
Well, they'll help you ride.
HMJr:
What?
R:
They'll be on your team.
HMJr:
(Laughs)
R:
They'll help you ride.
HMJr:
Well, I'd like to be on your team.
R:
All right.
HMJr:
Do you really think that I ought to go down
there?
R:
Well, I think it would be a fine thing and
Wright 18 awfully loyal, you know.
HMJr:
Yeah.
R:
And he's terribly anxious for you to go.
HMJr:
Yeah.
R:
He thinks you'd be a lot of help down there.
HMJr:
Well, I feel highly complimented that anybody
wants me.
R:
Well -- well, you are Henry Morgenthau in the
first place, and in the next place you're
Secretary of the Treasury. Of course, I'm --
mine's the other way. I'm Speaker of the House
and then I'm Sam -- Little Sam Rayburn, you see.
HMJr:
(Laughs) Listen, when did you go to Ireland to
kiss the Blarney Stone?
R:
(Laughs) I haven't been there.
HMJr:
You haven't?
R:
Well, Henry, I hope you do consider that.
- 3 -
102
HMJr:
Yeah. Now, while I've got you and you're in
such a good frame of mind, is this -- all these
meetings that O'Connell was up to see you about,
are all fixed?
R:
Yeah, all fixed for Satur -- Friday at two o'clock
in the House.
HMJr:
Yeah.
R:
He said that the Senate didn't want to go on
Thursday.
HMJr:
Yeah. And are we going to have....
R:
And I've called all the Chairmen except Sol. I'll
get him.
HMJr:
And we'll have a little dress rehearsal Thursday?
R:
That's right, Thursday afternoon.
HMJr:
Wonderful.
R:
And I'll just get the Chairmen there.
HMJr:
That's right.
R:
All right, Henry.
HMJr:
All right.
R:
Fine.
HMJr:
Thank you.
103
APR 17 1944
My dear Mr. President:
On April 3 you sent no Secretary Ickes' letter of March 6,
suggesting that the issue of the recent tax bill vote again be
placed before the people. You asked, "What do you think ve OAR
40 about thie?"
In my opinion this 10 net the time to respon the question
of the veteed tax bill. The sentrovery over the vote has nb-
sided. Responing the matter new would not sppreciably strengthen
your record on the bill or the voto, while it would endanger the
prespect of securing a simplification lav. Tea will recall that
in my letter of March 8, I indicated that in agreeing with
Senater George and Chairman Doughten to limit the scope of the
simplification bill vs would be premising. in effect, that no
revenue or social security message would be sent up. at least
while the simplification bill is pending in the Xouse.
The tax situation is very fluid, beverer, and 10 say be
desirable a little later is the year to reaffirm the need for
higher vartime tax revenue. A statement on this subject night
touch also on the problem of tax adjustments appropriate to the
transition and postwar periods. This problem is under study is
the Treasury at the present time. There is also is process of
preparation a "Vaste Paper describing and defending the pelicies
of the Administration is financing the var.
If all appropriate secasion arises for making a tax statement,
I should like to present suggestions to you as to its contents.
Faithfully yours,
(signed) ML Morgonthou, Jr.
Secretary of the Treasury
The President
The White House
B:eb
4/17/44
Regraded Unclassified
(in
(ever,
Pine
The
Blough to for 104
pare letter for
April 8, 1944 Higis us. to
MEMORANDUM FOR THE SECRETARY
Pres.
From: Mr. Sullivan
Ins
Mr. Blough
RB
Mr. Surrey
It 16 recommended that no action be taken at this
time to take the tax bill to the people, as proposed in
Secretary Ickes' letter to the President.
The Revenue Bill of 1943 was vetoed February 22, 1944.
Secretary Ickes' letter was sent to the President March 6.
It 18 now April 8. The controversy raised in connection
with the tax bill has subsided. Whether or not the issue
should have been reopened when Secretary Ickes' letter
was written, the present is emphatically not the time to
reopen it.
Any steps taken at this time to reopen the discussion
of the tax bill would, in our opinion, meet with public
disapproval and endanger the chances of securing a
simplification law. Moreover, such a step would be in
effect a contradiction of your letters of March 03 to the
President and to Senator George and Chairman Doughton.
In a field so fluid 2.8 that of texation the situation
may change BO that a further statement by the President
on taxes may be found desirable at a. later date. As you
know, there 18 in process of preparation a "White Paper"
describing and defending the policies of the Administra-
tion in financing the war, which may be useful in
connection with any such future statement.
Regraded Unclassified
105
THE WHITE HOUSE
WASHINGTON
April 3, 1944.
MEMORANDUM FOR
HON. HENRY MORGENTHAU, JR.
What do you think we can
do about this?
F.D.R.
Regraded Unclassified
106
SECRETARY OF THE INTERIOR
WASHINGTON
March 6, 1944.
MJ dont Mr. President:
T suggest again that the tax bill will prove to in 3
popular 1:sue if it is taken to the people. If it be argund
that if you should do this you might be charged with reopen-
ing the controversy with Barkley, the reply could be that the
alternative would permit the metropolitan press to get away
with the proposition that you were in the wrong in vetoing
this bill, and that you had no constitutional right to do 80.
After all, this is your issue because you made it. You have
not answered the specious argumente advanced by Barkley and
the newspapers and others. The opposition should not be per-
mitted to get 8 verdict by default. I do not believe that any
one else can effectively open this fight, although others can
help after the issue has been raised. It would not be necessary
to mention Barkley. or anyone else, by name. The discussion
should be kept on an impersonal basis, but the reasons for your
veto should be stated clearly and simply as you best can do.
Moreover, I think that the whole issue should be put up to
the people promptly. It ought to be done, in my judgment, be-
fore the people shrug their shoulders with indifference and, not
being well advised in the matter, come to the conclusion that
the Administration was probably wrong because it stood silent
under grave charges.
Sincerely yours,
HoroldL.,EW
Secretary of the Interior.
The President,
The White House.
Regraded Unclassified
107
APR 17 1944
My dear Mr. Attorney General:
Answering your letter of April 13, 1944,
the informal understanding that has been
reached between representatives of your
Department and this one that the Department
of Justice will represent the Treasury in
proceedings in the Tax Court of the United
States involving renegotiation under Title VII
of the Revenue Act of 1943, is entirely agreeable
to the Department, and this letter will act
to confirm it.
Sincerely yours,
(Higmed) M. Mergenthau, Jr.
Secretary of the Treasury
The Honorable
The Attorney General
Washington, D. C.
JJO'C.Jr:cp
4/17/44
Regraded Unclassified
Office of the Attorney General
Washington, B.01.
April 15, 1944
The
Honorable
A
Secretary of the Treasury
Washington 25, D. C.
My dear Mr. Secretary:
In conversations between members of your staff and
representatives of this Department, it was agreed that this
Department should represent you in proceedings in the Tax
Court involving renegotiations under Title VII of the Reve-
nue Act of 1943.
will you be good enough to confirm this arrangement.
Sincerely yours,
Attorney General
Regraded Unclassified
Darm
109-
TREASURY DEPARTMENT
INTER OFFICE COMMUNICATION
DATE
April 17, 1944
TO
Mr. Charles Bell
FROM Mrs. Doyle mwD
I have now been employed in the Treasury for 6 months as Employee
Relations Adviser, and I thought that the Secretary might wish to know
what I have been doing. I have listed my main fields of endeavor with an
indication of future plans in each field. In effect, all these activities
are ways and means to carry out the Secretary's wish that Treasury
employees have the best possible working conditions, together with such
services as will tend to keep employees healthy, well-adjusted and as free
as possible from worry.
1, Day Care for Children of Working Mothers
A. A continuous program is maintained to insure comprehensive
information to Treasury mothers of young children concerning available
facilities. The program is as follows:
1. Circulars are mailed to all mothers who expressed a need
for day care for their children. These circulars list all
nursery schools and extended day care centers in Metropolitan
Washington that are maintained from Lanham Funds and super-
vised by municipal or educational authorities.
pl
2, Circulars are made available to all personnel officers.
3. I visit every school personally and keep on hand informa-
tion on teachers, type of equipment, food served, etc.
4. As each new school opens, mothers who live in the vicinity
are called on the telephone and advised of the school.
5. Personnel officers have been asked to send to the Employee
Relations Section for an interview all who express an
intention to resign, giving as a reason lack of care for
their children,
B. Statistics
1. Number of mothers leaving:
July
59
August
28
September
27
October
27
November
19
December
17
January
23
February
23
March
19
Regraded Unclassified
- 2 -
110
2. Treasury children now in schools:
January 4, 1944 - 28
April 14, 1944 - 47
C. Future Plans
1. The vacation months when schools are closed present E. problem
to working mothers. To meet their needs a circular will be issued
on playgrounds that are open all day throughout the summer. I have
arranged with the D. C. Recreation Department to have playground
supervisors visit the homes of Treasury mothers who wish it, after
working hours, to acquaint them with play opportunities. These
services are all free.
2, A survey will be made of Treasury mothers who need child care
to follow up the survey conducted by the Children's Bureau 6 months
ago.
II. Health Program
À. I have kept in touch with the proposed Employee Health Service and
the medical program. In this connection I have taken the following steps:
1. I have had conferences with Mr. Charles Bell and with the
doctors in charge of the program from time to time.
2, I have visited all the Emergency Units.
3. I work with Dr. Whitehead on individual cases, on the Employee
Health Service, on nutrition and related subjects.
4. I give one of the lectures in the In-Service Training Course
for nurses at the Public Health Center. lly lecture is on
"Community Resources".
5. I strive to insure that the Employee Health Service shall move
forward constructively and without friction.
B. Future Plans
1. Space with adequate facilities for an enlargement of Dr.
Whitehead's quarters is desirable to insure privacy for
Treasury employees who need medical aid.
2. A survey at the Bureau of Engraving and Printing on the
illness of employees should be initiated soon by the U. S.
Public Health Service.
3. A conference of all personnel officers in the Treasury at
which the Medical Program would be explained by the U. S. Public
Health Service - Dr. Parran or Dr. van Acheren, At the same
time, the new psychiatric service could be explained by the
psychiatrist, Dr. Solby.
4. Initiation of the Visiting Nurse service under the supervision
of the Medical Officer of the Treasury.
Regraded Unclassified
111
- 3 -
III. Individual Counselling of Women
During the past 6 months I have interviewed 59 women. These cases
came to me the following way:
Referred by Mr. Jordan
12
On their own initiative
22
Referred by Medical Officer
5
For care of children
7
Other referrals
13
59
Referred by Mr. Jordan: These cases include among others women who are
referred by their supervisors to the Employee
Relations Section because they are "difficult". In
some cases I try to counsel the women to work more
cooperatively, to get more rest or to see a
physician. In others, I come to the conclusion that
the woman is not entirely at fault, and I therefore
recommend that she be transferred. Such cases
naturally include interviews with the supervisory
officers.
On Their Own Initiative: These have a wide range end include such problems
1. Girl who needs help in finding home for her
self and coming baby. This case includes
constant counselling as there are many family
complications developing from a marriage which
WEB kept secret for several months.
2, Difficulty on the job: personality problems.
3. Women who are "nervous" and "want to talk to
another woman".
4. Need for information on educational or
recreational or volunteer opportunities.
5. Request for shift from night work.
Referred by Doctor:
Dr. Whitehead sends me cases of women that he
thinks need help in adjustment. For instance, he
sent to me a young girl who came to him with
laryngitis. She was in a highly nervous state. She
wished to resign immediately but would give him no
reason. Her supervisors could not understand her
wish to resign as she was a conscientious, faithful
employee whom they were anxious to retain.
I gained the girl's confidence. She was seen by
the psychiatrist of the U. S. Public Health Service.
He worked with her, corresponded with her father,
recommended a 10 day visit to her home. He
suggested to me that upon her return I keep a
contact with her 80 that I may help her if she gets
so "upset inside" again.
Regraded Unclassified
112
- 4 -
She is, for the present, a happy, well-adjusted
employee and has been recommended for a promotion.
One interesting phase of this case is that this girl
told her inward nervousness to no one but to me,
therefore, no one of her fellow workers or supervisors
would have been able to help her if Dr. Whitehead had
not recognized that she needed such help and sent her
to ne for counsel. A good employee has thus made an
adjustment to the job.
IV. Cafeteria
I have served as chairman of the Cafeteria Committee with Mr. Birgfeld and
Mr. Barker as the other members of the Committee.
The cafeteria in the Main Treasury has been the greatest single help to
employees since I have been here. The attractiveness of the room and the
good food are enjoyed by all, but the general atmosphere of relaxation that
prevails in the cafeteria is its greatest asset.
V. Visit to Chicago
I made a complete report on my visit to Chicago on March 29, 1944.
I think that I should visit the Chicago office again in about 6 months
as B follow-up.
VI, General Conditions
I am interested in any method that can be used to alleviate for men and
Women the strain of a 6 day week of 8 hour days. The difficulties of market-
ing, of shopping for clothes for self or family, of crowded street cars and
buses, all extend the work day for women, Sundays and evenings must be used
for personal chores, such as mending, washing or household duties. Life
becomes a proposition of working all day today, and sleeping to got ready
for to-morrow. This will inevitably result in poor work in the office.
For the duration, therefore, we should be continuously conscious that this
problem exists and we should use any methods possible to make working
conditions as good AS can be. Some of these are:
1. Complete cessation of work for 10 - 15 minutes twice a day in
rooms where there are noisy machines. The rooms should be
thoroughly aired during the recess. The Division of Disbursement
initiated on April 3 a schedule of rest periode of 15 minutes
during the forenoon and during the afternoon.
A survey of other divisions and bureaus is being made in order
that the program may be carried further.
2, Elimination of the midnight to 8 a. = shift whenever possible,
Regraded Unclassified
113
- 5 -
3. A room for smoking and relaxation. A pattern is being
developed in the Main Treasury Building and, if practicable,
this pattern will be followed in other buildings.
4. Even greater use of the Emergency Rooms. Short rest periods
in bed are often suggested by the Medical Officer and such rest
will keep an employee fit to stay on the Job.
5. As mentioned above, Cafeterias are a very real aid,
especially when they provide a chance for social contact
during the meal.
6. A coordinated program of information on housing, recreation,
health facilities, and community resources under the Employee
Relations Section.
7. Regular conferences of personnel officers to discuss the
best methods of maintaining such working conditions as will
produce the best work.
Regraded Unclassified
114
April 17, 1944.
Mr. Charles S. Bell,
Administrative Assistant
to the Secretary.
Dear Mr. Bells
You are hereby designated to serve as a member
of the Treasury Department Committee on Deferment of
Government Employees established on March 16, 1943, in
accordance with the provisions of Executive Order
No. 9309.
Very truly yours,
(Mgaed) E. Morgenthau, Jr.
Secretary of the Treasury.
je
Regraded Unclassified
115
April 17, 1944.
Dear Mr. Puryear:
Pursuant to War Manpower Commission General Order
No. 7 and in accordance with the provisions of Executive
Order No. 9309, I wish to advise that Mr. Charles S. Bell,
Administrative Assistant to the Secretary, has been
designated to serve as a member of the Treasury Department
Committee on Deferment of Government Employees to replace
the late Mr. N. Norman Thompson.
Very truly;yours,
(Wigned) H. Morgenthau, Jr.
Secretary of the Treasury.
Mr. Edgar F. Puryear,
Chairman, Review Committee on
Deferment of Government Employees,
Room 1123, 1778 Pennsylvania Avenue, N. N.,
Washington, D. C.
je
Regraded Unclassified
116
TREASURY DEPARTMENT
INTER OFFICE COMMUNICATION
DATE April 17,1944
TO
Secretary Morgenthau
FROM
R. E. McConnell
Subject: Three O'Clock appointment with Colonel Robert Doyle and
Mr. McConnell.
Colonel Doyle has a wide acquaintance among the mer-
chandisers. He was the Manager of Lord & Taylor; was also
the head of McCreery & Company. He is a close personal
friend of General Marshall. He organized and was the head
of the Orange Crush Company in Chicago. He dropped this
to join the General Staff under General Eisenhower. He
has been particularly successful in organization work.
I doubt that Colonel Doyle would be able to undertake
this assignment because of recent injuries. He does, how-
ever, seem to appreciate the nature of the problem. He
believes the Department should obtain the most able mer-
chant in America who has had a diversified experience.
I think if you can give Colonel Doyle five or ten
minutes he can give you his analysis of the problem which
may be helpful.
I am canvassing the industry rather extensively be-
cause I feel that it is very important not to make 8.
mistake in this appointment.
General Browning will also have four or five suggestions
this afternoon.
117
TREASURY DEPARTMENT
INTER OFFICE COMMUNICATION
CONFIDENTIAL
DATEADRIL 17, 1944
TO
Secretary Morgenthau
FROM
Mr. Has CA.
Subject:
The Business Situation,
Week ending April 15, 1944.
Summary
Employment: Factory employment in March declined for the
fourth consecutive month, with total factory employment
felling slightly under 13. 4 millions as compared with
14.0 millions at the war-time peak last November. Out-
backs in war contracts, loss of workers due to the draft,
and increased efficiency in production processes have
contributed to the recent decline in employment.
Commodity prices: Futures prices displayed an easing tendency
last week, but spot prices generally showed little change.
While the BLS index of 28 basic commodities W&S a trifle
lower, it has moved in D. very narrov range during the last
five weeks, following B. gradual rise since November. The
BLS all-commodity index continues only fractionally above
the level of a year ago.
Crop report: The April 1 crop report indicates B. winter wheat
crop of 602 million bushels, 75 million more than was fore-
cast last fall, but heavy rains or cold weather have generally
delayed farm work and may reduce acreage and yields in some
areas, Late frosts have damaged early vegetable and fruit
crops in the South. For the country 0.6 a whole, however,
prospects are still favorable for the planting of & near-
record crop acreage.
Stock market: Despite a renewed advance in prices of second-
grade railroad bonds, stock transactions on the New York
Exchange showed a further decline last week, while the Dow-
Jones average of 65 stocks eased fractionally. Indicative
of recent bearishness on the part of many traders, the short
interest showed a further rise of 7 percent in March and
attained the highest level since June 30, 1938.
Textile industry: To correct the growing shortage of textile
week, effective May 14. (Current hours average around 41.5.)
goods, the textile industry has been placed on E. 48-hour
Other industries now on & 48-hour basis are steel, lumber,
and non-ferrous metals.
Regraded Unclassified
118
- 2 -
Factory employment lower in March
The decline in factory employment which started near
the close of 1943 continued in March, with the number employed
dropping nearly 200,000 below the February level. In
consequence, the estimated number of wage earners employed
in manufacturing industries fell slightly under 13.4 mil-
lions, as compared with last November's war-time peak of
14.0 millions. The reduction in factory employment in
March W&B rather general, with 17 of the 20 major manu-
facturing groups showing declines. The most important
factor W&G a decrease of 46,000 workers in the transportation
equipment industry, now largely engaged in making wer equip-
ment. The automobile industry employed 14,000 fewer workers
during the month, while sizeable employment declines also
occurred in the chemical, machinery (excluding electrical),
and iron and steel industries, in reflection of further
out-backs in small arms ammunition, explosives, and machine
tools.
Improved production processes and more efficient manpower
utilization in turning out wer materials have been cited as
importent contributory factors in the decline in factory
employment in recent months. Reference to Chart 1 will
disclose that since national defense preparations got under
way in the latter part of 1940, factory production has risen
et & much faster pace than employment. It will also be noted
that, following a sharp drop in December, actual factory output
in January and February 1944 W&B maintained at unchanged levels,
while factory employment was declining. Further divergence in
the trend of factory employment and output probably occurred
in March, as the employment index showed another decline,
while preliminary reports indicate a well-sustained level of
factory output although the actual production index for March
18 not yet available.
Civilian production restricted by labor shortages
Although the WMC Chairman stated last week that labor
shortages currently are causing less damage to war production
than at any time in the last 12 months, the WPB recently tightened
restrictions on production of civilian goods in 183 labor
shortage areas. In a move to concentrate manpower in war
plants, the WPB issued orders to hold civilian production in
the 183 areas at the current rate or first quarter rate,
whichever 18 lower. While the order does not apply to
producers using surplus materials or those able to operate
without WPB aid, it is apparent that previous expectations of
119
- 3 -
1944 civilian production in some lines may have to be
revised drastically as a result. It 18 reported that
the order will hold electric iron production in 1944 to
around 200,000 units instead of the 2 million previously
scheduled. On the other hand, it 18 expected to have
little effect on the program for producing 88,000 electric
ranges for domestic use in 1944.
Cotton textile industry ordered on 48-hour week
In contrast to a slight increase in employment in the
durable goods industries during the past year, employment in
the nondurable goods industries in March was nearly 350,000,
or 6 percent, less than & year earlier. Nearly one-third
of this decline was accounted for by the textile mill
products group, due largely to manpower difficulties, which
arise in part from the relatively low wage scales in the
industry. With cotton textile production in the first
quarter of 1944 falling below last year's level, while
textile requirements for the current year are estimated above
the 1944 level, the WMC last week issued an order placing the
cotton textile industry on a 48-hour week. The order will
become effective May 14 and will apply to all plants manu-
facturing and processing cotton yarns and broad woven fabrics.
Inasmuch as average weekly hours in the textile industry
are currently reported to be around 41.5, it is obvious that
a substantial increase in production of cotton textiles should
result from the order, unless offsetting factors intervene.
The cotton textile industry will be the fourth industry to
8 on the 48-hour week on & nation-wide basis, the others
being steel, lumber and non-ferrous metal mining and milling.
Despite the trend toward the longer work week under the
pressure of war-time conditions, it 18 interesting to note
that the Conference Board index of actual hours worked per
week in 25 manufacturing industries in January was still only
91.9 percent of the 1923 average.
Construction contract awards at low level
With contracts for construction of war plant facilities
dwindling to low levels, and severe WPB restrictions on
private construction continuing in effect, construction
contract awards in the first quarter of 1944 declined far
below the corresponding period of last year. Despite B.
seasonal upturn in March, total construction contract awards
during the first quarter of this year, as reported by the
F. W. Dodge Corporation, were 56 percent below last year's
level. (See Chart 2.) This drop was entirely due to the
Regraded Unclassified
120
- 4 -
decline in public ownership projects, as awards for privately
owned projects were OR percent above the very low level pre-
vailing in the first quarter of 1943.
Contract awards for manufacturing buildings in the
first 3 months of 1944 were only one half as large as in
the corresponding period last year. The widest declines
occurred in awards for construction in the automobile
and aircraft, metal working, and petroleum refining industries.
On the other hand, construction awards in the chemical
industry continued above last year's level and exceeded all
other categories, while awards in the food products and textile
industries also showed notable gains.
Futures prices lower but spots show little change
Futures prices showed some weakness last week, but in
the spot markets there W0.8 little change except in hog and
steer prices. The BLS index of 28 basic commodities was e
trifle lower. (See Chart 3.) This index has moved within
B very narrow range during the past five weeks, following
the gradually rising trend which had been apparent since
last November. The leveling out in cotton prices and the
downturn in rosin prices have been largely responsible for
stopping the rising trend of the index.
With hog receipts heavy, prices declined noticeably
last week to around the Government support level, but steer
prices showed an appreciable rise. Many droves of good and
choice quality butcher hoge have been marketed ahead of
schedule because of the necessity to conserve feed grains,
end also because of the elimination of the Government support
program for hogs weighing over 270 pounds, effective April 15.
The BLS all-commodity index in the week ended April DA
advanced 0.1 percent. Higher prices for grains, eggs, and
apples accounted for most of the advance, but the increases
in federal excise taxes, particularly for alcohol, had some
effect on the index. At 103.7 percent of the 1926 average
the index 1s now 0.2 percent higher than in the corresponding
week of 1943, and is 38.3 percent above the pre-war level
of August 1939.
Wheat prospects improved but farm work still delayed
While winter wheat prospects have improved markedly,
frequent rains and snows or cold weather have delayed farm
work in nearly all states, according to the April 1 general
crop report of the Department of Agriculture. Last month was
the wettest March since 1922. In the northern portion of the
121
- 5 -
country east of the Rocky Mountains, the delay in field
work has not yet become serious and the heavy rains have
greatly improved prospects for pasture and hay crops. In
the southern portion, however, the late planting season may
affect the acreage that can be sown to spring oats and may
also tend to reduce yields of corn and small graine in
some areas. Moreover, late frosts have damaged early
vegetable and fruit crops in the South. Contrasting with
other areas, the Pacific Northwest has continued to receive
insufficient rain, and prospects for crops and ranges are
rather unfavorable. For the country as a whole, however,
the Department of Agriculture states that weather irregularities
to date do not appear particularly significant except in the
Pacific Northwest, and prospects are still favorable for the
planting of a near-record acreage of crops.
Although conditions on April 1 indicated & peach crop
somewhat better than average and materially larger than the
1943 harvest in all of the 10 early Southern States, low
temperatures during the first week of April caused damage
to & varying extent in most of the states. A preliminary
check, however, shows a smaller reduction in the prospective
crop than was suggested by early reports. Citrus fruit
production has attained a record level this year, with the
1943-44 orange crop now estimated at more than 99 million
boxes as compared th around 85 million boxes last year.
Winter wheat production of 602 million bushels is now
indicated, which represents an increase of 75 million bushels
over the forecast made last December. Rye prospects have
also improved and on April 1 the condition was 79 percent of
normal, which is 4 points above the 1933-42 average.
The acreage of early potatoes shows & small increase,
but the larger acreage may be offset by smaller yields due
to unfavorable weather. While the spring vegetable acreage
is estimated to be almost one-fourth larger than a year ago,
cold and wet weather has retarded growth, and total tonnage
may be only about 16 percent above that of last year.
Grain stocks considerably reduced
Due to the heavy feed requirements of our record live-
stock population, grain stocks on farms have been considerably
reduced since last fall. Farm stocks on April 1 were at the
lowest level for that date in five years, although sub-
stantially above the 1933-42 average. Disappearance of corn
from farms during the first three months of 1944 amounted to
about 883 million bushels, the heaviest on record.
122
- 6 -
The following table compares the stocks of grain on
farms on April 1 in the past two years with the 1933-42
average:
10-year average
1933-42
1943
1944
(--Millions of bushels--)
Corn
973
1,375
1,114
Wheat
148
325
218
Oate
384
505
418
While stocks of grain on farms are still large, supplies
available for purchase in deficit areas are smaller than
the total stocks would indicate, owing to the tendency of
farmers to hold grain for feeding on their own farms. The
supply situation of corn processors continues critical due
to the very light corn marketings.
OPA to establish ceiling prices on
luxury fruits and vegetables
Ceiling prices on fresh strawberries will be established
in the near future, the OPA announced last week, in a move
designed to protect growers of basic war foods and to prevent
undue increases in prices to consumers. Shipping point
meximume will be set generally at 1943 levele, and will be
translated into community dollar-and-cents ceilings by adding
freight cost and markups. With the acreage of strawberries
indicated to be 23 percent less than in 1943, prices would
be likely to rise considerably if ceilings were not imposed.
The OPA also indicated that other "luxury" foods such
08 watermelons and cantaloupes will have price ceilings this
summer, along with all major fruits and vegetables. Prices
of many of these items increased from 80 to 100 percent last
year. Some growers who raised "luxury" foods derived larger
profite than those growers who concentrated on raising basic
war crops. Thus the establishment of ceiling prices on
strawberries, cantaloupes, watermelons, and other such
products should tend to reduce this advantage.
Another significant action taken by the OPA last week
was to raise the manufacturers' ceiling price on rolled
oats by 1.3 cents per pound. The result will be an increase
in the retail price of about 3 cents for a 20-ounce package.
The revision in the ceiling was necessary to maintain adequate
production "in the face of the substantial increase in the prices
Regraded Unclassified
123
- 7 -
of row oats" during the past two years. The previous price
ceilings had been set at the March 1942 level, and since
that time the price of raw oats has risen 44 percent.
Easing in cold storage situation indicated
The tight situation in cold storage freezer space has
been relieved somewhat, judging from the April 1 cold storage
report of the WFA, which shows a decline in freezer occupancy
from 92 percent on March 1 to 87 percent on April 1. A year
ago, however, only 61 percent of the freezer space was
occupied. Unusually heavy withdrawals of frozen fruits,
vegetables, and butter, together with declines in holdings
of frozen poultry and meat, were largely responsible for
the lower freezer occupancy. Nevertheless, stocks of these
items continue to be substantially larger than last year.
Frozen egg stocks showed a much greater than normal increase
and are now 50 percent larger than a year ago.
Counterbalancing the decline in freezer occupancy, a
seasonal increase in cooler occupancy was noted, with cooler
space 79 percent in use as compared with 74 percent last
month and 61 percent on April 1, 1943. Reductions in
stocks of apples and cheese during the month were more than
offset by significant accumulations of shell eggs and lard.
Apple stocks are only 58 percent of last year's stocks, but
lard holdings are 232 percent above last year.
Stock market activity shows further decline
Stock market activity continued to decline last week,
with transactions on Friday falling to the lowest level for
any full day since October 14, 1943. (See Chart 4.) Caution
engendered by uncertainties over invasion prospects appeared
to be the dominant factor in the market's lethargy. Despite
sporadic strength in railroad issues, featured by a rise to
B. new high for the year in prices of second-grade railroad
bonds, the Dow-Jones average of 65 stocks at the close on
Saturday was fractionally below week-earlier levels. Indicative
of the prevailing caution or bearishness on the part of many
traders recently, it was revealed last week that the short
interest on the New York Stock Exchange during March showed a
further increase of 7 percent. Moreover, the total short
interest of 1,028,000 shares was the highest since June 30, 1938.
Regraded Unclassified
FACTORY EMPLOYMENT AND OUTPUT
1939 - 100, Unadjusted
PERCENT
PERCENT
240
240
220
220
200
200
Manufacturing Output, F.R.B.
180
180
160
160
140
140
Factory Employment, B.L.S.
120
120
100
100
80
80
J M M J S N J M M J S N J M M J S N J M M J S N JMMJSNJMMJSM
1939
1940
1941
1942
1943
1944
Chart : 124
Office of the Secretary of the Treasury
Division of Research and Statistics
Regraded G-537 Unclassified
Chart E
125
TOTAL CONSTRUCTION CONTRACT AWARDS
(37 States, F. W. Dodge Corp.)
DOLLARS
DOLL ARS
Millions
Millions
1000
1000
1942
800
800
600
600
1940
400
400
1943
200
200
1944
o
o
JAN
FEB.
MAR.
APR
MAY
JUNE
JULY
AUG
SEPT
OCT.
NOV
DEC
MANUFACTURING BUILDINGS
CONSTRUCTION CONTRACTS AWARDED
DOLLARS
DOLLARS
Millions
Millions
400
400
1942
300
300
1943
200
200
100
100
1940
1944
o
0
JAN.
FEB.
MAR.
APR.
MAY
JUNE
JULY
AUG
SEPT
OCT
NOV
DEC
Offer of the Secretary of the Treasury
C-444-A
finearch -
Regraded Unclassified
MOVEMENT OF BASIC COMMODITY PRICES
1942
1943
1944
PERCENT
PERCENT
AUGUST 1939 . 100
220
220
210
210
9 Uncontrolled Commodities
As of February 1942*
200
200
190
190
28 Commodities
180
180
170
170
19 Controlled Commodities
160
160
DEC
FEB
APR.
JUNE
AUG.
OCT
DEC.
FEB
APR.
JUNE
1942
1943
1944
}
fl
PERCENTAGE CHANGE DEC. 6. 1942 TO APR. 6, AND APR. 14, 1944
PERCENT
PERCENT
19 Controlled
9 Uncontrolled
Barley 76.0%
Commodities
Commodities
+ 70
+70
Flexseed 64.6%
Flosin 638%
+ 60
+60
Corn 56.9%
+ 50
* 50
126
Wheat 44.6%
- 40
+ 40
Hogs 35.8%
Lard 28.8%
+ 30
Shellec 12.3%
,30
(Lead 111%
Sugar 6.9%
(Cottonseed Oil 6.3%
Steers 255%
Print Cloth 4.9%
+20
+20
Cotton 212%
Burlap 2.6%
Wool Tops 1.9%
Zinc 3%
Butter 18.8%
0% Change
+ 10
+ 10
Mides, Silk,
Tin, Rubber,
Coffee, Copper,
St. Scrop. dom.,
0
o
St. Scrap,exp.
Cocoa -8%
Tellow -4.1%
- 10
- 10
Dec. 6,
Apc.6,
Apc14,
Dec. 6,
Apr.6.
Apr.14,
1944
1944
1941
1941
1944
1944
All commodities in index are now under some forms of price control except rosin and cotton.
Office of the Secretary of the Treasury
Date of Statemica
Regraded Unclassified
Chart " 127
STOCK PRICES, DOW-JONES AVERAGES
Daily
1943
1944
DEC.
JAN.
FEB.
MAR.
APR.
MAY
JUNE
5
12
is
26
2.
9
IS
23
30
6
13
20
27
5
12
IS
26
2
9
16
23
30
7
14
24
28
4
"
is
25
DOLLARS
DOLLARS
155
155
30 Industrial Stocks
150
150
145
145
140
140
135
135
130
130
125
125
120
120
40
40
38
20 Railroads
38
36
36
34
34
32
1"
32
30
30
24
24
15 Utilities
22
22
20
20
18
18
SHARES
SHARES
Millions
Millions
Volume of Trading
2
2
I
I
o
o
ES
30
7
14
24
28
4
=
18
as
5
12
=
26
=
9
16
ts
30
6
13
to
17
5
12
-
as
t
9
16
DEC.
JAN.
FEB.
MAR.
APR.
MAY
JUNE
1943
1944
- el the Sentry of to Injury
P-144-L
I 1 . 1 I
Regraded Unclassified
128
BRITISH air COMMISSION
1785 MASSACHUSETTS AVENUE
WASHINGTON, D. C.
TELEPHONE HOBART 9000
PLEASE QUOTE
REFERENCE NO
With the compliments of British Air Commission
who enclose Statements Nos. 130, 131 and 132 -
Aircraft Despatched - for the weeks ended
March 21st, March 31st and April 7th respectively.
The Honourable Henry Morgenthau, Jr.
Secretary of the Treasury
WASHINGTON, D. C.
April 17, 1944.
129
TOP SECRET
STATEMENT NO.130
Aircraft Despatched from the United States
Week Ended March 21st, 1944
ASSEMBLY
BY
BY
FLIGHT DELIVERED
DESTINATION
POINT
SEA
AIR
FOR USE IN CANADA
TYPE
BOEING
Fortress III
Asores
Azores
1
Catalina IVB
U.K.
U.K.
5
CONSOLIDATED
Liberator B VI M.E.
M.E.
1
Liberator BVI India
India
2
Liberator BVI Canada
Canada
1
NORTH AMERICAN
Mitchell II
U.K.
U.K.
1
Mustang
N.W. Africa
Casablanca
9
VEGA
Ventura GR V
M.E.
M.E.
1
Ventura GR V
S. Africa
S. Africa
1
GLENN MARTIN
Baltimore V
M.E.
M.E.
10
DOUGLAS
Boston IV
U.K.
U.K.
14
Dauntless SBDV U.K.
U.K.
6
VULTEE
Vengeance
U.K.
U.K.
2
Vengeance
Australia
Sydney
9
Vengeance
Australia
Melbourne
14
GRUMMAN
Avenger
U.K.
U.K.
5
REPUBLIC
Thunderbolt
India
Karachi
25
TINSON
eliant
U.K.
U.K.
3
BELL
Bell P-63
U.K.
U.K.
1
FAIRCHILD
Argus
India
Karachi
10
NOORDUYN
arvard
U.K.
U.K.
6
TOTAL:
36
1
90
Note: In Statement No.129 Ventura GR V to U.K. should read 1 not 2 and Ventura GR V to
8. Africa should read 4 not 3.
Movements Division
British Air Commission
smb
March 27, 1944
Regraded Unclassified
TOP SECRET
130
STATEMENT NO, 131
Aircraft Despatched from the United States
Ten Darà Ended March 11st, 1944
ASSEMBLY
BY
BY
FLIGHT DELIVERED
DESTINATION
POINT
SEA
TYPE
AIR
FOR USE IN CANADA
CONSOLIDATED
Liberator B VI M.E.
M.E.
3
Liberator B VI India
India
7
GLENN MARTIN
Marauder II
M.B.
M.E.
1
Baltimore
N.E.
M.E.
15
NORTH AMERICAN
Mitchell II
Canada
Canada
10
*thistang
N.W.Africa
Casablanca
45
Harvard
New Zealand
Auckland
6
Harvard
S. Africa
Capetown
21
*Mustang
U.K.
U.K.
8
Harvard
8. Rhodesia
Capetown
5
GLAS
Boston IV
U.K.
U.K.
9
Dakota III
U.K.
U.K.
6
BOEING
Catalina IVB
U.K.
U.K.
10
BEECH
Expediter
Columbia
British Military Attache
1
NOORDUYN
Harvards
U.K.
U.K.
50
REPUBLIC
*Thunderbolt
India
Karachi
15
*Thunderbolt
U.K.
U.K.
2
WACO
Gliders
M.E.
M.E.
20
-LTEE
Vengeance
India
Karachi
4
Vengeance
U.K.
U.K.
3
*Vengeance
U.K.
U.K.
21
VOUGHT-SIKORSKY
Gorsair
U.K.
U.K.
8
Helioppter
U.K.
U.K.
1
OTHUMAN
Goose
1
Canada
Canada
*Avenger
U.K.
U.K.
1
Wildoat
U.K.
U.K.
1
*Hellcat
U.K.
U.K.
1
FAIRCHILDS
Cornell PT26
S.Rhodesia
Capetown
71
Cornell PT26
S.Africa
Capetown
71
Argus 2
N.W.Africa
Algiers
5
Regraded Unclassified
131
STATEMENT NO. 131
(cont'd)
ASSEMBLY
BY
BY
TYPE
DESTINATION
POINT
SEA
FLIGHT DELIVERED
AIR
FOR USE IN CANADA
VEGA
Ventura GR V
U.K.
U.K.
5
Ventura GR V
M.E.
M.E.
3
Ventura GR V
S.Africa
S.Africa
2
CURTISS
Kittyhawks
Australia
Melbourne
10
Kittyhawks
Australia
Sydney
10
Kittyhawks
New Zealand
Auckland
12
Total
391
62
11
* Naked Fuselages
Notation - Re Statement 130 March 27th relating to revised destination for Ventura GR V,
it is confirmed that destination as reported in Statement 129 is correct.
Correction as noted in Statement 130 should therefore be deleted.
Movements Division
British Air Commission
jab
April 12, 1944
132
STATEMENT NO. 132
TOP SECRET
Aircraft Despatched from the United States
Week Ended April 7th, 1944
ASSEMBLY
BY
BY
FLIGHT DELIVERED
DESTINATION
POINT
TIPE
SEA
AIR FOR USE IN CANADA
CONSOLIDATED
Liberator B VI
U.K.
U.K.
2
Liberator B VI
M.E.
M.E.
28
Liberator B VI
India
India
26
Libemator B VI
Canada
Canada
5
Catalina 1 B
U.K.
U.K.
1
GLENN MARTIN
Varauder III
U.K.
U.K.
2
Narander III
M.E.
M.E.
41
Baltimore V
M.E.
M.E.
30
DOUGLAS
Boston IV
U.K.
U.K.
9
Dakota III
U.K.
U.K.
2
Dakota III
N.E.
M.E.
8
Dakota III
India
India
4
Dakota III
N. Africa
N. Africa
1
BOEING
Catalina IV B
U.K.
U.K.
9
NORTH AMERICAN
Mitchell II
Canada
Canada
4
Harvard
U.K.
U.K.
15
Harvard
S. Africa
Capetown
10
VEGA
Ventura GR V
U.K.
U.K.
4
Ventura GR V
S. Africa
S. Africa
9
FAIRCHILD
Cornell PT 26
S. Africa
Capetown
55
Argus II
M.E.
M.E.
5
NOORDUYN
Harvard
U.K.
U.K.
109
Harvard
U.K.
U.K.
53
REPUBLIC
Thunderbolt
India
Karachi
28
Thunderbolt
India
Madras
10
WACO
Glider
India
Karachi (via M.E.) 20
VULTEE
*
Vengeance
India
Karachi
4
# Vengeance
U.K.
U.K.
7
.
VOUGHT-SIKORSKY
Corsairs
U.K.
U.K.
6
#
Naked fuselages.
Total:
322
176
9
Movements Division, British Air Commission
anh File V-17
Regraded Unclassifie
THE WHITE HOUSE
WASHINGTON
April 17, 1944
MEMORANDUM TO
MR. JIM ABRAMSON
For your information.
DAVID K. NILES
Regraded Unclassified
Has been proposed that our government offer now temporary
ection and refuge to those people in Europe who have been
ecuted by the Nazis but have escaped, and are now homeless,
could save themselves by coming here. The plan proposes
it these people would be kept in special camps in this
try for the duration of the war. They would not be allowed
have jobs outside the camps. When the war is over, they
ald all be returned to their native lands. Would you approve
disapprove of this plan?
Approve
70%
Disapprove
23%
Don't know
7%
Chief Reasons given by those who Disapprove:
(1) Fear and dislike of foreigners.
(2) We are not sure they would leave when the
war is over.
(3) Objections to cost involved.
H. C.
April 14, 1944
Regraded Unclassified
135
WAR REFUGEE BOARD
Executive Office of the President
Washington
FOR RELEASE MORNING NETSPAPERS
RELEASE NO. 9
Monday, April 17, 1944
John W. Pehle, executive director of the War Refugee Board,
today announced the appointment of Dr. Robert C. Dexter, executive
director and acting commissioner for Europe of the Unitarian Service
Committee, as the Board's special representative in Lisbon, Portugal.
Dr. Dexter has been in Lisbon since the fall of 1942. In his
new post, as special attache to the Logation on war rofugee mattors,
he will work with public and privato agencies in doveloping programs
and implementing measures for tho rescue, transportation, maintonanco
and roliof of refugoos.
Ho has spent much of his life abroad. For soven months in the
wintor of 1941 and 1942 he dirocted the Unitarian Service activities
in Portugal and England. In 1940 he spont throe months in Europo
survoying rofugoc noods. At that timo ho visited 13 countrios and
was instrumontal in sccuring the roloaso of 1,500 prisonors in Hungary.
In 1938 ho was hcad of the Commission for Service in Czochoslovakia
and was docorated by the Czoch Govornmont-in-Exilo for his work with
Caoch refugoes. Bofore the war ho travolod in Hungary and Rumania
and attended many sossions of the Assombly and Council of the League
of Nations in Gonova. In 1926 he was ono of 50 university profossors
sent to the Haguo and Germany by the Carnogio Endowment.
A graduato of Brown University, Dr. Doxtor was for 10 years a
social worker in the United Statos and Canada and taught social
and political scionco at Skidmoro Colloge and Clark University.
Regraded Unclassified
136
APR 17 1944
Dear John:
Thank you very much for your letter of
April 14 concerning the efforts which have been
made to try to save the lives of Polish Jews and
other persons interned in enemy occupied Europe
who hold passports issued in the names of Latin
American countries. This is one of the many
projects in which the War Refugee Board is engaged
designed to forestall the extermination of the
Jewish people of Europe and other victims of
Nazi oppression.
You may be assured that the doors of the War
Refugee Board are always open to Rabbi Korff and
any other person who can contribute in any way to
our efforts to save these people from death.
Your real interest in this matter is greatly
appreciated.
Sincerely yours,
(Signed) Henry
Honorable John W. McCormack
Majority Leader
House of Representatives.
JEDuBois:ecr 4/15/44 goo In
Regraded Unclassified
137
JOHN W. McCORMACK
EUGENE T. KINNALY
SECRETARY
12TH Dut. MASSACHUSETTS
ffice of the Majority Leader
house of Representatives H. 5.
Bashington, D. C.
14th April, 1944
Hon. Henry Morgenthau, Jr.,
Secretary of the Treasury,
Washington, D. C.
PERSONAL AND CONFIDENTIAL
Dear Henry:
I want to take this occasion to extend to you my sincere
thanks for the manner in which you have received my very good friend,
Rabbi (Dr.) Baruck Korff, of 160 Central Park, South, New York City,
who is a close personal friend of mine and one for whom I entertain
the highest regard.
I am most pleased at the preliminary results and progress
which has been made toward the goal of rescuing those unfortunate
victims of Hitlerism. I am certain these results are due in no small
measure to your splendid cooperation.
You may be assured of my deep appreciation of your further
cooperation with Dr. Korff whenever he feels it necessary to contact
you personally.
With kindest personal regards,
Sincerely yours,
Regraded Unclassified
138
MEMORANDUM
April 17, 1944.
TO:
Sir Herbert Emerson, Director, Intergovernmental Committee
on Refugees.
FROM:
Mr. John Pehle, Executive Director, War Refugee Board.
SUBJECT: The Intergovernmental Committee on Refugees and its
Working Relations with the War Refugee Board.
This is a reply to your memorandum of April 14 in which
you presented your proposals as to the working relationships that
should prevail between the Intergovernmental Committee and the
War Refugee Board. First of all I wish to state that I am in
entire agreement with the proposals contained in the memorandum.
It seems to me that on the basis of the working relationships
which you outline, it should be possible for our respective
agencies to contánue to work in complete harmohy toward our common
goal of alleviating the plight of the refugees. We are sending
copies of this exchange of memoranda to our representatives abroad,
and are again emphasizing to them the necessity for the closest
cooperation on the part of members of our respective staffs.
The discussions that we have held in recent days have been
of extreme help to us in appreciating both the assigned duties and
actual achievements of your organization. The spirit you have
demonstrated leads me to believe that the relations between our
two agencies will continue to be mutually helpful and friendly.
Your generous offer of unstinted cooperation is appreciated
and I wish to assure you that we on our part intend to reciprocate
wholeheartedly. Only in this way can we move forward together,
united in our determination to meet the tragically pressing refugee
problem.
(s) J. W. Pehle
4/21/44
Regraded Unclassified
139
CABLE TO AMBASSADOR WINANT, LONDON
You are referred to the Department's telegram of
January 25 No. 634 regarding the establishment of the War Refugee Board.
The Board feels that it would be desirable to appoint a Special
Representative in London to operate there on its behalf. The Special
Representative 80 appointed will be designated by the Department as
Special Attache to the Embassy.
In general the Special Representative would be charged with
the responsibility and duty of carrying out the policies and program of
the Board in Great Britain. He will be responsible to you and will be
instructed to regularly and fully discuss his activities and problems
with you. Among other things, he will be expected to develop and
awsist in the development of programs and implementation of measures
for the rescue, maintenance, relief and transportation of refugees
and to forward recommendations and frequent reports on progress of
work and difficulties encountered,
At the present time no selection has been made for the
position of Special Representative. However, the Board would like
to send to London Dorothy K. Brown (Mrs. La Rue Brown) as an assistant
to the Special Representative who will be designated later. It is
understood that Mrs. Brown is known to you. Please advise the De-
partment promptly as to your views with respect to this matter.
April 17, 1944
11:15 A.M.
CCI Miss Chauncey (for the Sec'y.), Abrahamson, DuBois, Friedman,
Hodel, Laughlin, Lesser, Mann, Pehle, Stewart, Central Files,
Cable Control Files.
EFRainsime 4/14/44
Regraded Unclassified
140
NO. 15,061
London, England, April 17, 1944.
di AIR POUCH
Economic Warfare (Blockade) Series: No. 861
Subject: Letter from Lord Drogheda to Mr. Riefler
concerning suggested method of financing
operations of the har Refugee Board in
enemy territory.
CONFIDENTIAL
The Honorable
The Secretary of State,
Washington, D. C.
Sir:
I have the honor to refer to the Department's tele-
from No. 2518 of March 31 and to transmit a copy of a
letter from Lord Drogheda, Director General of the Minis-
try of Economic Marfare, to Mr. Riefler concerning the
action which has been taken by the British Government to
ensure coordination with the work of the War Refugee Board.
The Embassy transmitted to Mr. Nemec and Mr. Becko
the Lest of the license contained in the reference telegram
authorizing a remittance of $150,000 for their use in carry-
ing out the objectives of the War Refugee Board in Czecho-
slovakia and has discussed with the Ministry of Economic
Warfare the arrangements necessary for making the license
effective.
The enclosed letter, although not directly concerned
with this license, sets forth a suggested method for financ-
ang similar operations in the future. The Embassy assumes
Regraded Unclassified
141
- 2 -
procedure outlined has already been raised in Washington by
Lord Halifax and would appreciate being informed if it is
decided to take action along the lines proposed.
Respectfully yours,
For the Ambassador:
John W. Easton
Lt. Colonel, F.A.
Economic Warfare Division
Enclosure:
Copy of letter from Lord Drogheda to
Mr. Riefler, dated April 8, 1944.
Surgested distribution by the Department:
Foreign Economic Administration, Washington
war Refugee Board
MC:JH
(Original and hectograph to the Department)
Regraded Unclassified
142
COPY
Enclosure
Ministry of Economic Warfare,
Berkeley Square House,
Berkeley Square,
CONFIDENTIAL
London, W.1.
April 8th, 1944.
My dear Riefler,
AS I promised in our conversation yesterday, I am
writing to inform you of the action that has been taken by
Ris Majesty's Government to ensure co-ordination with the
work of the war Refugee Board.
This aspect of the subject first arose in October
last when we learned. that the U.S. Treasury had granted a
license to the World Jewish Congress for the expenditure
of 25,000 dollars on refugee operations from Switzerland.
The American Minister in Berne felt unable to agree to
this license without the concurrence of his British colleague
who referred the matter to us for instruction. After dis-
cussion with your people, we were able to afree to this
license subject to & slightly stricter definition of the
conditions on which the currency of the energy territories
concerned might be obtained, and on the under. tanding that
further licenses for the expenditure of funds for E similar
purpose would not be granted without consultation end until
11 report had been received of the work of the proposed
schemes of rescue.
We were, therefore, rather perturbed to learn in
February through the Foreign Office, that at the instigation
of the War Refugee Board & license had been granted for the
remittance of 100,000 dollars to the International Red Cross
Committee for the assistance of refugees, part at least to
be spent in Hungary and Roumania on food and other supplies,
as this grant was contrary to the policy previously agreed
between us.
This financial point, together with other aspects of
the refugee problem was recently been discussed by the Mar
Cabinet Committee on Refugees, and H.M. Ambassador at
Mashington has been instructed to represent how undesirable
it is to give, without prior consultation, licenses on
Regraded Unclassified
143
- 2 -
terms which cut across agreed blockade policy. Notwith-
standing the conditions laid down for the procurement of the
enemy currencies required, it seems likely that the effect
of these licences would be to make Swiss france available
to the enemy, and this, in our view, cannot be described as
action "consistent with the successful prosecution of the
war" as laid down in the War Refugee Board's terms of re-
ference. Lord Halifax will however make it clear that H.
B. Government are in full sympathy with the purposes of the
har Refugee Board, whose creation they have publicly wel-
comed and with whom they have stated their determination
to co-operate. Our sole object is to ensure that any
action which might be taken in which H.M. Government would
assist, would not be in & form which would give help to the
enemy.
Lord Halifax will also point out that the raising of
funds in enemy territories by means of loans from persons
in those territories against post-war repayment is far
superior from the blockade point of view to the actual use
of dollars or Swiss francs in occupied countries. The
Inter-Governmental Committee have already been successful
in raising very considerable sums of money in this war
against & personal promise of repayment given by Mr. Sally
Meyer, a leading Swiss Jew; and in the opinion of the
Committee, much more local currency could be obtained in
this way if more backing were available for repayment after
the war. But the use of dollars or other hard currency,
even though blocked until after the war, would be an em-
barrassment to the organisations concerned since it would
be likely to disrupt the credit scheme. Those who up to
now have accepted credit would be encouraged to demand cash.
H.M. Government, therefore, have & new suggestion to
make. The charitable organisations which have set aside
sums for credit schemes of this kind will doubtless continue
to do so, but more can be spent than can be raised from
these sources. H.M. Government propose accordingly that
they should supplement these schemes, and those already run
be the exiled governments, by setting up a guarantee fund
in the hands of the Governmental Committee in which H.M.
Government and the U.S. Government would contribute in equal
shares under their normal arrangements for covering the
Committee's normal operational expenses.
Regraded Unclassified
144
- 3 -
In order to avoid receipts or credit notes for loans
made in enemy countries for this purpose, which are backed
by a guarantee of the British and American Governments,
becoming negotiable instruments, H.M. Government suggest
that receipts for goods and services which were supplied to
refugees should be made out to the lenders in enemy terri-
tory and deposited in & Swise bank for redemption after the
mar, and that the lenders should be only verbally informed.
These receipts would be guaranteed by the fund in question.
On the basis of the information at present available it is
proposed to ask Parliament for whatever sums may be neces-
sary for this purpose up to million, provided the U.S.
Government would contribute a similar sum.
H.M. Ambassador at Washington will emphasize that His
Majesty's Government's proposals are designed to prevent the
risk of benefiting the enemy and also to extend the possi-
bility of benefiting persons, whose relief and safety is a
cause which both Governments have equally at heart, and in
whose interest it in important that there should be complete
co-operation at the centre and that competition between
different interests should be eliminated. Above all we
fear that the licensing of remittances might take on such
dimensions that substantial advantage to the enemy would re-
sult.
I am very glad to learn that we shall in future be able
to discuss with you those aspects of the refugee problem
which concern this Ministry. We are very much interested
in this problem, and wish to handle it in the fullest co-
operation with you and in such a way as to bring the minimum
of benefit to the enemy, as well as the maximum benefit to
the refugees.
Yours sincerely,
(sd.) DROGHEDA
Copied by: JH
Regraded Unclassified
EMBASSY OF THE
UNITED STATES OF AMERICA
145
San Jose, Costa Rica,
April 17, 1944.
No. 1279
Subject: Views of Foreign Minister regarding subject
matter Department's Secret Air grams of
March 31 and April 11.
STRICTLY CONFIDENTIAL
The Honorable
the Secretary of State,
Washington.
Sir:
With reference to the Department's secret airgrams
of - arch 31 and pril 11, 1944, I have the honor to
advIse the Department that on April 15th I discussed
the subject matter thereof with the Minister for
Foreign Affaire. Be stated that our conversation was
most opportune since he had been contemplating taking
an early opportunity to recomend to President Calderen
Guardia a complete investigation of all outstanding
Costa "ican passports. It had been his original in-
tention of declaring the invalidity of a number of
these passports and the restriction of others to
limited periods of validity only.
The Minister stated be thoroughly understood the
situation and would be inclined to cooperate with the
Department aleng the lines recommended in view of the
humanitarian condiérations involved. As be stated,
there was no other alternative but to attempt to save
the people concerned from harsh treatment by the Germans.
As suggested, I recommended that the Foreign
Minister address the German Government through the
protecting power as soen as possible along the lines I
suggested in the Department's sirgram of April 11.
shall remind him of this matter either to-day or
tomorrow.
Respectfully yours,
/6/Edward G. Trueblood,
Edward G. Trueblood,
BOTIMO
Charge d'Affaires ad interim.
Regraded Unclassified
146
INBASSY OF THE
UNITED STATES OF AMERICA
Managua, D.N., Nicaragua, Agr 11 17, 1944.
No. 2137.
Subjects Nicaraguan Passports Held by Europeans
in Occupied Europe.
SECRET-3Y COURIER
The Honorable
The Secretary of State,
Washington,
Sir:
I have the honor to refer to the Department's
further circular secret airgram of April 11, 1944,
11 44, regarding the attitude which the Department
hopes/will be adopted by the Nicaraguan Government
toward the bearers in occupied Europe of Nicaraguan
passports. This was the subject, likewise, of the
Embassy's secret despatch no, 2128 dated April 13,
1944.
In view of the instructions contained in the air-
gram under reference, and as forecast in my despatch,
I had an opportunity today of discussing this subject
with Dr. ARGUELLO, the Foreign Minister.
Dr. Arguelle stated that the Nicaraguan Govern-
ment believed that between 125 to 150 persons in occu-
pied Europe had fraudulently obtained Nicaraguan pass-
ports. It had been the practice of his Government here-
tofore generally to decline to confirm the validity
of any such travel documents when questions were asked
by the German Government through the Swies Government
as protecting power. In a few cases involving humani-
tarian considerations, they had confirmed the bearers
as Nicaraguan nationals, although they were aware that
the travel documents had been fraudulently obtained.
Dr. Arguello said that he could not say offhand
whether any requests for confirmation of validity had
been received through the Spanish Government. He would
look into
Regraded Unclassified
147
- 2 -
Regraded Unclassified
look into the matter and let me know. Similarly, he
would discuss with President Somosa the feasibility
of sending through this Embassy and the American Lega-
tion at Bern a telegram beseeching the German author-
ities to safeguard the interests of the bearers of all
Nicaraguan passports. He thought that the President
would accede and that this might be done. He intimated,
however, that Nicaragua would probably not want to
receive may of these persons as permanent residents
of the country. He thought, however, that if we could
assure the Nicaraguan Government that the Nicaraguan
passports of these people would be taken up following
their exit from occupied Europe after exchange for
German nationals, and that (as I indicated to him)
these persons would not reach Nicaragua, the President
would probably approve our negotiating for such an
exchange on behalf of his Government.
Dr. Arguelle intimated that he would like to have
something from the Embassy in writing on this subject
before discussing the matter with President Somosa,
but when I had explained that I was reluctant to trans-
mit any written document on this subject, he seemed to
accept that position.
As soon as a further conversation is had with
Dr. Arguello on this subject, I shall not fail promptly
to report the results.
Respectfully yours,
Harold D. Finley
Charge d'Affaires ad interim
801.2
HDF/gp
148
ORIGINAL TEXT OF TELEGRAM SENT
FROM:
Secretary of State, Washington
TO:
Amlegation, Lisbon
DATED:
April 17, 1944
NUMBER: 1058
SECRET
From War Refugee Board to Norweb.
Please deliver the following messalge to Dr. Joseph
Schwarts, 242 Rua Aurea, Lisben, From Meses 4. Leavitt
of the American Jewish Joint Distribution Committee:
"Regret not possible issue special
passport to you and your regular passport
renewable any American Consulate. Liebmann
Hirsch cables Jewish Labor Committee request-
ing more funds for OSE children rescue program.
Difficult understand why OSE reports to you
satisfactory relationship with Saly Mayer and
at name time continues send requests for funds
directly and through Hirsch. Important this
be clarified with OSE since separatist fund
raising efforts are disrupting maximum cellec-
tions. Suggest if possible OSE cable directly
its representatives here regarding their satie-
factory cesperation Saly Mayer. Remitted
$25,000 to Finance Officer British Foreign Office
for Island of Rab evacuation".
HULL
Regraded Unclassified
149
ORIGINAL TEXT OF TELEGRAM SENT
FROM:
Secretary of State, Washington
TO:
American Legation, Lisbon
DATED: April 17, 1944
NUMBER: 1059
SECRET
FROM JOINT DISTRIBUTION COMMITTEE AND WAR REFUGEE BOARD
TO MINISTER NORWEB, LISBON, PORTUGAL.
The following message to Joseph Schwartz, 242 Rua Aurea,
Lisbon from Joint Distribution Committee and War Refugee Board.
QUOTE. Reference your Nos. 879 of March 23 and 918 of
March 27.
Have received message from Steinhardt urgently recommend-
ing that you conclude negotiations for Portuguese ship with
Portuguese Shipping Company as apparently there is sufficiently
large number of refugees to justify use of ships in addition
to SS TARI. Furthermore, granting of German safe conduct
for SS TARI is not (repeat not) certain. Please conclude negotia-
tions as soon as possible and keep us advised. UNQUOTE.
It will be appreciated if you and Mr. Dexter will lend
all possible assistance to Mr. Schwartz in his effort to obtain
a Portuguese ship for evacuation from Rumania. Please advise
the Board of action which should be taken by it to facilitate
these negotiations including the obtaining of safe conducts, etc.
This is WRB Cable No. 1.
"In order to avoid confusion in connection with its
cables to representatives in the field, the Board, com-
mencing with this cable, intends to number its cables
to each representative consecutively. In replying to
Board cables kindly refer to the WRB designation. You
should also consecutively number all cables to the Board"
Regraded Unclassified
149 - A
No. 150
American Embassy, Madrid, Spain.
April 17, 1944.
SECRET
BANCO ESPANOL EN PARIS
This bank has $240,000 on deposit in the United States
and blocked by the Treasury Department. Information recently
received concerning the change in ownership of its stock is
thought to be of interest.
The Banco Espanol en Paris was founded in Paris in
1924, with a capital of Fcs. 15,000,000. It was established
principally in connection with the financing of Spanish ex-
ports to France. The bank was formerly controlled by a group
of banks in the north of Spain, viz:
Banco Guipuzcoano
Banco de Aragon
Banco Mercantil de Santander
Banco Zaragozano
Caja de Ahorros de Guipuzcoa
La Vasconia
Barcaiztegui y Maestre, San Sebastian
Garriga Nogues, Barcelona
It is reported by informed sources that at the outbreak
of the war the Board of Directors of this bank decided to
convert part of the capital into dollars. This was done, and
the amount of $240,000 was deposited with its correspondents
in New York, i.e., the Irving Trust Company and the Manufacturers
Trust Company. This amount was subsequently frozen by the
United States, and the bank has been unable to obtain transfer
Regraded Unclassified
149-B
- 2 -
of these dollars to the Instituto Espanol de Moneda Extranjera,
Madrid. It is reported that applications were filed by both
the American banks mentioned above, on behalf of the Instituto
Espanol do Moneda Extranjera, with the assistance of the Consul
General of Spain in New York. The Irving Trust Company
requested the unblocking of $195,000 and the Manufacturers
Trust Company applied for the release of $35,000. On February
23, 1943 the Manufacturers Trust Company wrote the Banco
Espanol en Paris, Madrid, that they had been informed by
the Federal Reserve Bank of New York that the Treasury Depart-
ment had denied their application for permission to transfer
the sum of $35,000 from the account of the Banco Espanol en
Paris to the account of the Instituto Espanol de Moneda
Estranjera, Madrid, adding that the Treasury Department has
made a policy not to state the reasons for its decisions. In
view of this it is stated that the Banco Espanol en Paris has
dropped the matter.
On January 1, 1942, the Board of Directors represented
by the Spanish banks mentioned above arranged to sell their
interests in the Banco Espanol en Paris, owing to the situation
in France created by the war and the fact that the Banco
Exterior de Espana (an official bank) intended to establish
a branch in Paris which would make the existence of a private
Spanish bank impossible. The 30,000 bearer shares of 500 francs
each of the Banco Espanol en Paris were taken over as follows:
Banco Exterior de Espana
27,000 shares
Instituto Espanol de Moneda Extranjera
800 or 900 shares
Remainder - Acquired by other interests
The regulations of the Instituto Espanol de Moneda
Extranjera permit the purchase of shares of Spanish firms
abroad, and this is reported to be the first instance where
the Instituto has bought such shares (see Blas HUETE and Manuel
VILA in list of new Board of Directors of the Banco Espanol en
Paris given below).
The Banco Espanol en Paris continues to operate under
the name of Banco Espanol en Paris, and is the official corres-
pondent of the Instituto Espanol de Moneda Extranjera and an
affiliate of the Banco Exterior de Espana. The Banco Espanol
en Paris now has, through the Instituto Espanol de Moneda
Extranjera, the control of all money transfers in francs from
France to Spain and, through the Banco Exterior de Espana, the
control
Regraded Unclassified
149-C
- 3 -
control of the greater part of Spanish commercial operations
with foreign countries. Demetrio CARCELLER, Spanish Minister
of Industry and Commerce, has considerable interest in the
Banco Exterior de Espana, of which Manuel ARBURUA is General
Manager. Arburua's influence has steadily increased by orders
issued by Carceller in his capacity as Minister. Manuel
Arburua, Ildefonso Gonzalex-FIERRO, Ignacio VILLALONGA Villalba,
Salustiano LON LAGA, and Luis FIGUERAS Dotti (three of whom
are members of the Board of Directors of both the Banco Exterior
de Espana and the Banco Espanol en Paris) are known to be close
friends of Carceller and it 1s stated that these connections
make possible Carceller's close supervision of the activities
and policies of these two banks. It is generally considered
in local banking circles that the Banco Espanol en Paris now
depends entirely upon official support through the Banco
Exterior de Espana. In the event of a radical change of regime
in Spain and the dissolution of the present syndicates, it is
most likely that the bank will either disappear or be reorganized
with the elimination of the majority of the present members of
the Board of Directors.
The Financial operations of the Banco Espanol en Paris,
since the war have been almost nil, and commercial operations
are non-existent. The present financial operations of this
bank consist of transfer of capital of Spanish subjects from
France to Spain for the subsistence of their families and
relatives, and collection of interests on French securities
belonging to Spaniards domiciled in Spain. The Banco Espanol
en Paris has had very good relations with Morgan & Company of
Paris, but the latter has no capital interest in the bank.
Board of Directors of the Banco Espanol en Paris
Antonio GOICOECHEA
President. (Governor of Banco de
Espana)
Ramon ARTIGAS
Vice President, (Assistant Governor
of Banco de Espana and member
of Board of Directors of Banco
Exterior de Espana)
Blas HUETE
Vice President. (General Manager of
Instituto Espanol de Moneda
Extranjera)
Manuel ARBURUA
Member. (General Manager of Banco
Exterior de Espana)
Ildefonso Gonzalez-FIERRO Member. (Member of Board of Directors
of Banco Exterior de Espana)
Ignacio VILLALONGA Villalba Member. (Vice President of Banco
Central)
Regraded Unclassified
149- D
4 -
Salustiano LON Laga
Member. (Member of Banco Exterior
de Espana)
Luis SAEZ de Ibarra
Member. (General Manager of Banca
y Bolsa)
Luis FIGUERAS Dotti
Member. (General Manager of Banco
Hispano Colonial)
Federico REPARAZ
Member. (General Secretary of Red
Nacional de Ferrocarriles)
Ramon MACHIMBARRENA
Member. (Executive Secretary of
Banco Guipuzcoano)
Manuel VIIA
Member. (Assistant Director of
Instituto Espanol de Moneda
Extranjera)
M. H. GAURAN
Member. (General Manager of Banco
de Estado de Marruecos, Paris)
Antonio ANGULO
Member. (Member of Board of Directors
Marques de CAVIEDES
of Compania de Ferrocarriles del
Norte)
- -
Approved:
Ralph H. Ackerman
August Hurdlebring
Commercial Attache
American Clerk
820.02
AH/ah
Source of information: Local banking connections.
In single copy to the Department
(for ozalid machine)
NOTE:
On several occasions the Instituto Espanol de Moneda
Extranjera and the Banco Exterior de Espana sought the Embassy's
assistance to have the $240,000 now blocked in New York released.
The Embassy was informed by the Department (see Department's
air mail despatch no. 343 of March 24, 1943) that the application
from the Manufacturers Trust Company, New York, for the transfer
of $195,000 to the Instituto had been denied by the Treasury
Department.
Regraded Unclassified
150
CABLE TO HAROLD He TITTMANN, JR., AMERICAN REPRESENTATIVE, VATICAN CITY
As a result of intercession by the Holy See, whose humanitarian
efforts on behalf of the oppressed peoples of Europe have resulted in
the saving of thousands of lives, the Spanish Government has on several
occasions in the past recognised groups of Sephardic Jews in Axis-occupied
territory as Spanish nationals, and has intervened with Germany for their
release from concentration camps and subsequent evacuation to Spain.
Information has now been received by the War Refugee Board that
400 such Sephardic Jews, Spanish nationals residing in Athens, have
recently been imprisoned in a concentration camp, and it is vital that
they be given Spanish recognition to forestall deportation and almost
certain death.
It is earnestly requested that you approach appropriate Vatican
officials to the end that the Papal Nuncio at Madrid be advised of this
situation and his aid enlisted in the rescue of these unfortunates.
Full assurances may be given to the Spanish Government that funds will
be available for the support of such of these persons as may be
evacuated to Spain, and that prompt action will be taken to speed their
departure from Spain to places of refuge. Please keep the Department
informed of all developments.
April 17, 1944
5:25 p.m.
RISmith:LSLesser:als 4/17/44
Regraded Unclassified
151
CABLE TO MINISTER HARRISON AT BERN FROM THE WAR REFUGEE BOARD
The War Refugee Board requests that you deliver the following
message to Dr. Gerhart Rigner, Geneva: QUOTE Please advise whether
you can resume contacts with Willy, his superiors and associates,
and others exercising similar authority. If this is possible, would
appreciate your views as to possibility of arranging for evacuations
from Hungary to neutral countries or for holding up deportations
or permitting sending relief to those detained. If any such
arrangements possible, please indicate amounts you consider would
be involved and extent to which such amounts could remain in
neutral countries. Also ia Willy reliable. Signed Mahum Goldmann,
World Jewish Congress. UNQUOTE.
April 17, 1944.
11:15 a.m.
ISLesser:als 4/15/44
Regraded Unclassified
152
RMN-647
Bern
This telegram must be
paraphrased before being
Dated April 17, 1944
communicated to anyone
other than a Government
Rec'd 7:32 p.m.
agency. (BR)
Secretary of State
Washington.
US URGENT.
2425, April 17, 9 p.m.
Your 1299, April 15. I have delivered message
to McClelland as requested but would respectfully
point out that McClelland is not yet officially
representing War Refugee Board in Switzerland, has
not been accredited to Swiss as such and that such
action will depend on Department's determination of
his final status in response to my telegram number
754, March 22, and my follow up inquiry 2045,
April 3.
HARRISON
RB
Regraded Unclassified
153
CABLE TO AMBASSADOR STEINHARDT, ANKARA. FROM THE WAR
REFUGKE BOARD.
Hirschmann arrived Saturday. We are gratified
to receive his personal report on the difficult situation
in Turkey which you and he faced and which you are now
facing. We are convinced that his report in person was
indispensable to the Board's continued program in Turkey.
Hirschmann is working here with us on the pending
situations and you will hear from us concretely as soon
as possible.
The Board desires again to express to you its great
appreciation for the unremitting and wholehearted support
which Hirschmann has reported that you have given to all
of the efforts of this Government to save the lives of
victims of Nasi oppression.
THIS IS WRB ANKARA CABLE NO. 25
April 17, 1944
5:15 p.m.
Regraded Unclassified
ORIGNAL TEXT OF TELEGRAM SENT
154
FROM: SECENTARY OF STATE, WASHINGTON
TO:
AMERICAN EMPASSY, AMKARA
DATED: APRIL 17. 1944
NUMBER:-21 342
SECRET
FROM THE WAR REFUGER BOARD TO AMBASSADOR STEINHARDT,
ABKARA.
The following referes to your no. 657 of April 12 from
Ankara to the War Refuges Board.
With respect to the replacement of a passenger vessel
of QUOTE an equivalent vessel of similar age, size and general
characteristics UNQUOTE for the 88 TARI as designated in
Article 4 of the proposed charter with the Turkish Government
for the aferecaid ship, Hirschmana is in full agreement with
the position you have taken is your telegram abovenentioned.
Hirschmann and I conferred with Admiral Land of the Var
Shipping Administration today. The War Shipping Administration
and the Foreign Economic Administration have authorised you to
commit this Government to the replacement of the 88 TARI in the
event of less with a passenger repeat passenger vessel as year
quested by the Turkish Government.
At this point every recommendation submitted by you and
Hirschman to complete the negotiations for you to sign the
Charter agreement for the War Refugee Board with the Turkish
Government for the as SARI has been authorised. Please refer
to Var Refugee Board cable to Ankara No. 20 relating to all
the conditions mentioned is your numbers 585 and 594. The
single obstaels remaining is the granting of safe conduct
by the German Government. We have taken every available seasure
to expedite this safe conduct in Washington as reported in our
War Befuges Board cable no. 20.
Hirschmann informs no that Simond has expressed to him
unequivecally, unreserved confidence that VOR Paper would
arrange to obtain this safe conduct thout delay. He also
informs no that Simend agreed personally to see von Paper with-
in a few days after his first meeting with his in Ankara on
this subject. Assuming that the German safe conduct has not
been obtained Hirschmann urges that both Simond and the
Apostelic Delegate from Istembul arrange to see von Paper in
person in order to again urge granting of safe conduct without
delay. Hirschmann reports that Sinend expressed the view that
he can succeed in securing the safe conduct and he suggests that
you personally cenfer with Sineed along the above lines with
out delay.
Regraded Unclassified
155
CABLE TO AMBASSADOR STEINHARDT. ANKARA, FROM THE WAR
REFUGEE BOARD.
The following refers to your No. 657 of April 12 from
Ankara to the War Refugee Board.
With respect to the replacement of a passenger vessel
of QUOTE an equivalent vessel of similar age, sise and general
characteristics UNQUOTE for the SS TARI as designated in
Article 4 of the proposed charter with the Turkish Government
for the aforesaid ship, Hirschmann is in full agreement with
the position you have taken in your telegram abovementiched.
Hirschmann and I conferred with Admiral Land of the
War Shipping Administration today. The War Shipping Adminis-
tration and the Foreign Economic Administration have authroised
you to committhis Government to the replacement of the 8S
TARI in the event of loss with a passenger repeat passenger
vessel as requested by the Turkish Government.
At this point every recommendation submitted by you
and Hirschmann to complete the negotiations for you to sign
the charter agreement for the War Refugee Board with the
Turkish Government for the SS TARI has been authorised.
Please refer to War Refugee Board cable to Ankara No. 20
relating to all the conditions mentioned in your numbers
585 and 594. The single obstacle remaining is the granting
of safe conduct by the German Government. We have taken
évery available measure to expedite this safe conduct in
Washington as reported in our War Refugee Board cable No. 20.
Hirschmann informs ne that Simond has expressed to him
unequivocally, unreserved confidence that von Papen would
arrange to obtain thissafe conduct without delay. He also
informs me that Simond agreed personally to see von Papen within
a few days after his first meeting with him in Ankara on this
subject. Assuming that the German safe conduct has not been
obtained Hirschmann urges that both Simond and the Apostolic
Delegate from Istanbul arrange to see von Papen in person in
order to again urge granting of safe conduct without delay.
Hirschmann reports that Simond expressed the view that he can
succeed in securing the safe conduct and he suggests that you
personally confer with Simond along the above lines without
delay.
THIS IS WRB ANKARA CABLE NO. 26
April 17, 1944
6:10 p.m.
4-17-44
Regraded Unclassified
156
TELEGRAM SENT
PLAIN
JN
April 17, 1944
EMEASSY,
MOSCOW,
937-SEVENTEENTH
FOR AMBASSADOR FROM WAR REFUGEE BOARD.
With reference to the statement made by the President,
(Department's 699, March 24) the British Government, in a reaffirms-
tion of its attitude toward the Nazi war crimes and atrocities,
directed that the BBC report the President's statement fully in all
languages. Subsequently, on March 30, Mr. Eden, in the House of
Commons, reiterated the position of the British Government with
regard to these crimes.
You are requested to approach the appropriate authorities of
the Soviet Union and ascertain whether, in view of the positive
action taken by the British Government, the Soviet Government would
take similar action and issue a statement expressing its attitude
concerning the crimes and atrocities of the Nazis. It is felt by
the Department that such action on the part of the Soviet Govern-
ment would have a most profound and important effect upon the
leaders and peoples of Rumania and Hungary.
Please report the result of your discussions concerning this
matter.
HULL
(GLW)
WRB: GLW: KG
4/17/44
EE
LE
A-B
Regraded Unclassified
157
CARLE TO AMBASSADOR HARRIMAN, MOSCOW, RUSSIA FROM SECRETARY OF STATE HULL
Please refer to Department's circular airgram of January 26 in regard
to the cotablishment of the War Refugee Board, also to War Refugee Board
cobles Top. 554 and 555 of March 11.
The Executive Director of the Board John W. Pehle has informed the
Department that in conformity with the President's Order of January 22, the
Board proposes to appoint Mr. Robert J. Scovell, former representative of
the American Red Cross in Russie and now on the headquarters staff of that
organization, 88 the Special Representative of the Board with the designe-
tion by the Department as Special Attache to the Embassy on war refugee
mattern. The Presidential Order provides that the State Department shell
appoint such Special Attaches on the recommendation of the Board, that they
shell have diplomatic status, and that their duties and responsibilities
stall be defined by the Board in consultation with the State Department.
It is understood that Tr. Scovell 1s personally known to you. It is
assured that there will be no objection on the part of the Russian Government
to this designation, although you may in your discretion approach the
Russian authorities informally, if you consider 11 necessary 02 advisable to
do 50. If Tr. Scovell's appointment meets with your nj roval, please advise
DE accordingly in order that his designation may be nade effective et once.
If Scovell 1s appointed we propose to advise him through you that:
(a) He is charged with the duty and responsibility of cerrying
out the Board's policies and programs in Russia;
(b) He in responsible to the Ambarsador and should discuss his
activities end problems with him regularly and fully;
(c) The Embessy will provide him with the necessary commisication
Pecilities in carrying on his official duties;
(a) He should extend all possible assistance to the Ambassedor
in carrying out instructions contained in the airgram and cable-
grams referred to above;
(e) He should work with and give all possible assistance to
public and private agencies operating in Russia in this field
regardless of whether such organi ations BIG American, foreign
or international;
(f) He should develop and assist in the development of programs main-
and implementation of measures for the rescue, transportation,
tenance and relief of refugees;
(E) Be should forward to the Board recommendations and frequent
reports on progress of work and difficulties encountered;
Regraded Unclassified
158
-2-
(h) In so far as the Trading with the enemy Act 1a concerned,
the Secretary of the Treasury hes vested in the War Refugee Board
end its representatives in the field full authority to communicate
with enemy territory to carry out the purposes of the Order. The
Secretary of the Treasury has also delegated to the War Refugee Board
and its representatives the power to authorize any public or private
agencies who may be subject to the provisions of our Trading with
the enemy Act to communicate with enemy territory for the purpose of
carrying out the Order. Scovellis authorized to act eccordingly
upon your confirmation of his designation.
April 17, 1944
11:15 A.M.
Regraded Unclassified
159
PARAPHRASE OF TELEGRAM RECEIVED
FROM:
The American Ambassador, Moscow
TO:
The Secretary of State, Washington
DATE:
April 17, 1944
NUMBER:
1326
CONFIDENTIAL
I have received from the Foreign Office & memorandum
which replies to my memorandum of March 21st concerning
the creation of the War Refugee Board (please see my number
1020 dated 6 p.m., March 24 and number 1083 dated 1 p.m.,
March 23) which says in substance that the Russian Govern-
ment's policy has been, and still is, to aid the victims
of persecution by Hitlerite Germany in every way possible.
As the Embassy knows already the Government of the U.S.S.R.
in keeping with this principle has agreed to the passage of
three Bulgarian vessels and one Turkish ship from Rumanian
and Bulgarian ports to Turkey for thepurpose of evacuating
refugees.
It is my plan to discuss with the Foreign Office at the
first favorable opportunity the possibility d further
Russian cooperation in the implementation of our policy.
HARRIMAN
DCR:MPL
4/18/44
Regraded Unclassified
TELEPHAN SET
160
DE
April 17, 1944
This telagram must bE
paraphrased before being
8 p.m.
communicated to anyone
a Covernmental
( )
DEPARTMENT 65 STATE
U. S. URGENT
4%
OF
APR1 9
minnessy,
TIPNS
CHUNGKING.
513
FOR THE AUBASSADOR All ADLED: FROM THE SECRETARY OF
THE TREASURY
1. Arrangements are being made for the simultaneous
publication in Washington, London, Chunglaing, Moscow and
a number of other countries of joint statement by tech-
nical experts of the United and Aesociated Nations on
the establishment of an international Monotary Fund. Copy
of this joint statement has been Given to Rs1. Te-mou who
has informed us that 1t has already been cabled to Dr.
Runc. Hoi Te-mou Ins indicated that China pleased to
have joint statement published similtaneously in Chuncking,
Washington and other critals. For reasons of economy to
are not repeating this joint statement on the assumption
that copy can be obtained from Dr. Hung. Copies of
joint statement are Going forward by pouch.
2. I am to appear before the appropriate Congres-
sional committees on Priday, April 21, to bring them up
Regraded Unclassified
161
-2- 7513, April 17, e p.m. to Chungking
-0-
to date on our discussions regarding international
monotary cooperation and to present to them the Joint
statement. This joint statement will be released on
Saturday, April BG (April 25 in Chunglaine). It is
essontial that statement should not REPEAT INST be re-
loased in Changicing before it 10 roleased in Washington.
The statement will be released horo irrespective of
whether or not it is released in Changlang.
So In view of the fact that the Chineso technical
experts horo have indicated thoir agreement with the
proposal for establishment of an International Honetary
Fund, if I am asked during my testimony before the Con-
ressional corrittoos wother China has indicated acroo-
nont to this proposal, I will never "yes".
4. Minor changes have beon mado in the joint state-
mont which vas cabled to Dr. Rung. Weare advising the
Chinese ropresentativos hore of these minor changes. It
18 suggested that you obtain from Dr. Pung copy of joint
statement in order to make corrected copy for him. The
text to be released contains the following provisions in
Regraded Unclassified
162
-3- #513, April 1/, S p.m. to Chungking
-3-
place of those corresponding numbers in the joint state-
mont cabled to Dr. Rung:
QUOTE I-6 To assist in the establishment of multi-
lateral payments facilities on current trans-
actions among momber countries and the elimina-
tion of foreign exchange restrictions which
hampor the growth of world trade.
II-2
Member countries shall subscribe in cold and
in thoir local funds amounts (quotes) to be
agreed, which will amount altogethor to about
ro billion AS all the United and Associated
Nations subscribe to Who Fund (corresponding
to about 810 billion for the world as a whole.)
II-2
The quotes may bo rovised from time to t1:e
but changes shall require a four-fifths vote
and no member's quota may 0 changed without
its assent.
II-3, paragreph 2 The obligatory cold subscription
of a member whose home areas have suffered
substantial damage from eneury action or oscupa-
Regraded Unclassified
163
-4- #513, April 17, 0 p.m. to Chungking
tion shall be only three-fourths of the
above.
III-2(e) The Fund's total holdings of the curroncy
offered (aftor having been restored, if bolow
that figuro, to 75 percent of the member's
quota) have not boon increased by more then 25
percent of the member's quota during the pre-
vious twelvo months and do not oxceed 200
percent of the quota.
III-S So long as a member country 1e ontitled to
buy. 6 :ther nombor's curroncy from the Fund
in exchange for 10a own currency, it shall be
prepared to buy ite own currency from that
nombor with that member's currency or with
Gold. This shall not apply to currency sub-
ject to restrictions in conformity with IX,
S below, or to holdings of a current account
nature effected before the removal of the
member country of restrictions on multilatoral
clearing maintained or imposed under X, 2 below.
Regraded Unclassified
164
-5- #513, April 17, B p.m. to Chungking
-6-
VII-1 The Fund shall be governed by a board on which
each member will be represented and by on ore-
cutive committee. The executive committee shall
consist of at loast nino members including
tho representatives of the fivo countries with
the largest quotas.
VII-2 The distribution of voting power on the board
next the orocutivo condittee shall bo closoly
related to the quotas.
X-3 The Fund may make representations to any member
that conditions are Invorable to the with-
draval of particular restrictions or for the
general abandonment of the restrictions incon-
sistent with IX, 3, above. Not later than three
years after coning into force of the Fund any
member still retaining any restrictions incon-
sistent with IX, 5 shall consult with the l'und
ao to their furthor retention.
CULL
(EGC)
PAA:EC:ja
4/17/44
Regraded Unclassified
TELEGRAM SENT
165
April 17, 1944
This LC telegram must be
paraphrased before being
10 p.m.
communicated to anyone
other than 8. Governmental
agency. (BR)
Treasury
(white)
U. S. URGENT
DEPT TOP 1,F STATE
TRR1 1)
AMEMBASSY,
- MECORDS
MOSCOV.
938
FOR THE ALBASSADOR FROM THE SECRETARY OF THE TREASURY
1. I would appreciate it if you would call on the
People's Commisser of Finance and inform him that I have
just received word from the Chancellor of the Exchaquer
informing us of their agreement to the publication of
the Joint Statement of the technical experts of the United
and Associated Nations recommending the establishment of
an international monotory fund. It in contemplated that
the publication will be simultaneous in a mumber of the
United Nations. It would obviously be highly desirable
if the statement were issued at the same time in Mossov.
2. Please stress the desirability, for obvious
reasons, of having the Soviet Union join with the United
States, the United Kingdom, China and other United Nations
in a statement of this character setting forth the recom-
mondations of the experts on international monetary
cooperation.
Regraded Unclassified
166
#938, April 17, 1944, 10 p.m., to Moscow
-2-
So Arrangements have been made for the release of
this statement in Washington, London, Chunghing, and in
a mumber of other countries immediately after try appear-
ance before the appropriate Congressional committees which
is definitely scheduled for Friday afternoon, Time of
release 1s 8:00 Date Friday, April 21, Washington time.
4. The text to be released contains the following
provisions in place of those of corresponding numbers in
the Joint Statement cabled to your
UOTE I-5 To assist in the establishment of multilateral
payments facilities on current transactions among
member countries and the elimination of foreign
exchange restrictions which hamper the growth of
world trade.
II-1 Member countries shall subscribe in gold
and in their local funds amounts (quotas) to be
agreed, which will amount altogether to about 08
billion if all the United and Associated Nations
subscribe to the Fund (corresponding to about $10
billion for the world as 8 whole.)
Regraded Unclassified
167
#938, April 17, 1944, 10 p.m., to Moscow
&
II-2 The quotas my be revised from time to time,
but changes shall require a four-fifths vote and no
member's quota may be changed without 1ts assent.
II-S, (paragraph 8) The obligatory gold sub-
scription of a member whose home areas have suffered
substantial damage from enemy action or occupation
shall be only three-fourths of the above.
III-B(o) The Fund's total holdings of the currency
offered (efter having been restored, if below that
figure, to 75 percent of the member's quota) have
not been increased by more than 85 percent of the
whee's quota during the previous twelve months
and du not exceed 200 percent of the quota.
III-5 So long as A member country is entitled to
buy another member's currency from the Fund in use
change for its can currency, it shall be prepared to
buy its own currency from that member with that
memoer's currency or with gold, This shall not
apply to currency subject to restrictions in
Regraded Unclassified
168
#938, April 17, 1944, 10 p.m., to Moscow
conformity with IX, 3 below, or to holdings of a.
current account nature effected before the removal
by the member country of restrictions on multi-
lateral clearing maintained or imposed under X,
2 below.
VII-1 The Fund shall be governed by a board on
which oach member will bo represented and by an
executive committee. The executive commities shall
consist of at least nine members including the
representatives of the five countries with the
largest quotas.
VII-S The distribution of voting power on the
board and the executive comittee sholl he closely
related to the quotes.
X-S The Fund may make roprossntationgco any
member that conditions are favorable to the with-
drawal of particular restrictions or for the general
abandonment of the restrictions inconsistent with
Regraded Unclassified
169
(030, April 17, 1944, 10 p.m., to Moscow
-
IX, 3 above. Not later than three years after
coming into fores of the Fund any member still
retaining any restrictions inconsistent with
IXO S shall consult with the Fund as to their
further rotention. END QUOTE
HULL
(EGC)
FEA:EGC: ja
4/17/44
Regraded Unclassified
TELEGRAM SENT
PLAIN
RCC
170
US URGENT
April 17, 1944
AMERGASST
LONDON
3076, Seventeenth.- FOR THE AMBASSADOR FROM THE SECRETARY OF THE TREASURY.
1. The American technical experts have drafted & statement on the Bank for 200
construction and Development. Opie has been informed of this statement and has com-
municated with the British Treasury. Please deliver this statement to the Chanceller
of the Exchaquer for the U.K. technical experts.
2, The text of the proposed statement 1s as follows:
BEGIN QUOTE. PRELIMINARY DRAFT
& Statement on the Establishment of A Bank for Reconstruction and Development
The technical experts of some of the United and Associated Nations who have
participated in the discussions on international financial problems are of the
opinion that the revival of international investment after the war is essential to
the expansion of trade and the maintenance of a high level of business activity through-
out the world. In their opinion, the most practical method of encouraging and aiding
private investors to provide an adequate volume of capital for productive purposes
is through the establishment of a permanent Bank for Reconstruction and Development.
They have set forth below the principles which they, as technical experts, believe
should be the basis for this Bank. Governments are not asked to give final approval
to these principles until they have been embodied in the form of definite proposals.
I. Purposes and policies of the Bank.
1. The Bank will assist in the reconstruction and development of member countries
by facilitating provision of long term investment capital for productive purposes
through private financial agencies. It will do so by guaranteeing and participating
in the loans made by private investors.
2. The Bank will supplement private financial agencies by providing capital for
productive purposes out of its own resources, on conditions that amply safeguard its
funds, when private capital is not available on reasonable terms.
3. The Bank will promote the long-range balanced growth of international trade
by encouraging international investment for the development of the productive resources
of member countries.
4. The Bank will take into consideration, in its operations, the effect of inter-
national investment on business conditions in member countries. In the immediate post
war years, its policy will be to assist in bringing about a smooth transition from a
wartine to a peacetime economy.
II. Capital of the Bank.
1. The Capital of the Bank will be the equivalent of $10 billion, to be subscribed
by member governments. Liability on shares will be limited to the unpaid portion of the
subscription.
2. 1 substantial part of the subscribed capital of the Bank will be reserved
in the form of unpaid subscriptions at a surety fund for the securities guaranteed or
issued by the Bank.
3. The initial payment on shares will be 20 percent of the subscription, some
portion of which should be in gold and the remainder in local currency. Further par-
sent on subscriptions will be made as the Board of Directors may determine, but not more
than 20 percent of the subscription may be called in any one year.
Regraded Unclassified
- 2 -
171
III. Operations of the Bank.
The Bank will deal through the governments of member countries and their
fiscal 1. agencies, the International Monetary Fund, and other international agencies
braed predeminantly by member governments.
It may also deal with the public and private institutions of member countries
is the Bank's own securities or the securities which it has guaranteed.
2. An appropriate limit will be placed on the outstanding obligations of the
Bank: and all the resources of the Bank will be available to meet its obligations.
3. The Bank will not finance the local currency needs of a borrower except
in those special circumstances where facilities are not available for borrowing in-
vestment funds at home.
4. The Bank may guarantee, participate in, or make loans to any member country,
its political subdivisions, and business and industrial enterprises in a member
country, under the following conditions:
B. The national government, central bank or a comparable agency guarantees
the payment of interest and principal.
b. The borrower is otherwise unable to secure the funds from other sources under
conditions which in the opinion of the Bank are reasonable.
C. A competent committee, after careful study of the merite of the project,
reports that the loan would serve to raise the productivity of the borrowing country
and that the prospects are favorable to the servicing of the loan.
d. Loans are made reasonable rates of interest with schedules of repayment
appropriate to the project and the balance of payments prospects of the borrowing
country.
e. The Bank is compenented for its risk in guaranteeing loans made by private
investors.
5+ To encourage international investment in equity securities, the Bank may ob-
tain a governmental guarantee of conversion into foreign exchange of the current earnings
on such investments. It may also employ a small portion of its capital directly in
equity investment.
6. The Bank will impose no conditions as to the particular member country in which
a
loan will be spent. The Bank will make arrangements to assure the use of the loan
only for the approved purposes.
7. In providing the funds for loans made by the Bank, its policy will bet
a. To furnish the currencies needed by the borrower in connection with the loan.
b. To make available an appropriate part of the loan in gold or needed foreign
exchange when a development program gives rise to an increased need for foreign exchange.
c. To furnish gold or needed foreign exchange for & part of the loan expended by
the borrower at the request of countries in which portions of the loans are spent.
Regraded Unclassified
- 3 -
172
5. No loans may be guaranteed or made by the Bank without the approval of the
country in whose currency the loan is made.
9. With the approval of the representatives of the governments of the member
countries involved, the Bank may engage in the following operations:
B. It say issue, buy, or sell its own securities, securities taken from its
portfolio, or securities, which it has guaranteed.
b. It may borrow from member governments, central banks, or private financial
institutions in member countries.
C. It may buy or sell foreign exchange where such trensactions are necessary in
connection with its operations.
IV. Repayment Provisions.
1. Payment of interest and principal on loans participated in or made by the
Bank will be in currencies acceptable to the Bank or in gold.
2. In the event of an acute exchange stringency the Bank may, for brief periods,
accept local currency in payment of interest and principal under conditions that safe-
guard the value of the Bank's holdings.
3. Payment of interest and principal, whether made in currencies or in gold,
must be equivalent to the gold value of the loan and of the contractual interest thereom.
V. Management.
1. The administration of the Bank will be vested in a. governing board and an
executive committee representing the members. The governing board may appoint an ad-
visory council consisting of representatives of banking, business, labor and agricultural
intereste, and such committees as it finds necessary. Provision will be made for
consultation with other interested agencies on matters of direct interest to them.
2. The distribution of voting power will be closely related to the share holdings
of the member countries.
3. The Bank will publish regularly a balance sheet showing its financial position
and a statement of earnings showing the results of its operations. The Bank may also
publish from time to time such other information as would be helpful to the sound
development of international investment.
4. One-fourth of the profits would be applied to surplus until surplus equals 20
percent of the capital.
VI. Withdrawal and Suspension.
1. A member country may withdraw from the Bank by giving notice in writing.
2. A member country failing to meet its financial obligations to the Bank may be
declared in default and may be suspended from membership, provided that a majority of
the member countries 60 decides.
3. If & member country elects to withdraw or is dropped from the Bank, its shares
of stock would, if the Bank has & surplus, be repurchased at the price paid. If the Bank's
books show a loss, the country would bear a proportionate share of the loss. Appropriate
ND QUOTE.
provision should be made for meeting the contingent liabilities.
(HNM)TIQH
FMA:E.G.C. S MNH:MCW
ef:copy
Regraded Unclassified
173
TELEGRAM SENT
RCC
April 17, 1944
This telegram must be
paraphrased before being
midnight
communicated to anyone
other than a Governmental
agency. (BR)
US URGENT
DEPARTMENT W STATE
OF
APRI (1)
AMEMBASSY
-
ID
ACCORDS
LONDON
3077
FOR THE AMBASSADOR FROM SECRETARY MORGENTHAU
I am very grateful to you for the prompt reply
from the Chancellor of the Exchequer.
Please give this message to the Chancellor of the
Exchequer:
BEGIN QUOTE. 1. I wish to express my thanks to the
Chancellor of the Exchequer for his message of April 15.
2. At the request of the Congressional leaders, my
appearance before the appropriate Congressional
committees has been postponed to Friday, April 21.
In consequence of this modification, we shall release the
Joint Statement to the press at 8:00 p.m., April 21,
Washington time.
In accordance
Regraded Unclassified
174
-2-#3077, April 17, midnight to London.
In accordance with previous arrangements with Opie
we have asked Moscow and Chungking, as well as some of
the American Republics to join in the publication of the
Joint Statement. We are also sending a summary, but not
the text of the Joint Statement, to all of the American
Republics with whom we have consulted.
We assume you will make similar arrangements for
informing the Dominions and governments in London and
Cairo prior to publication, and to arrange, if possible,
for simultaneous publication or announcements by some
of these countries.
We have discussed with Opie the issuance of an
explanatory statement to the press at the time the text
of the Joint Statement is released. He will inform you
of our general agreement with the statement you suggest
and with the slight modification we propose. It is my
understanding that the explanatory statements issued in
Washington and London will not be precisely the same in
language although they will convey the same meaning.
Mr. White and Mr. Opie have examined in detail the
arrangement previously agreed upon for steps following the
publication of the Joint Statement on the Fund. As Mr.
Opie will have informed you, it has long been clearly
understood
Regraded Unclassified
175
-3-#3077, April 17, midnight, to London.
understood that after the publication of the Joint
Statement on the Fund there would be opportunity for
debate in Parliament. Promptly after the conclusion
of the debates, we will raise with you the immediate
issuance of invitations to & conference of the United
and Associated Nations on the establishment of
international agencies for postwar financial cooperation.
As I have previously explained, a prompt decision on
this matter would make it possible for us to hold a formal
conference at the end of May in accordance with the
preference expressed by the President.
3. We have transmitted to Winant the text of a
proposed Joint Statement on the establishment of a Bank
for Reconstruction and Development with the request that
he furnish it to you. The Joint Statement is confined
to an exposition of those principles which should govern
a Bank for Reconstruction and Development on which we
feel there could be no disagreement among the technical
experts.
Mr. White told Mr. Opie this morning that when I
appear before the Congressional committees on Friday
I will be compelled to report to them on the results
of the technical discussions on the Bank for
Reconstruction
Regraded Unclassified
176
-4-#3077, April 17, midnight, to London.
Reconstruction and Development. Obviously, I would like
to be able to report that the experts of the United
States and the United Kingdom are in agreement on a
statement of principles on the establishment of the
Bank, and at the same time make the statement available
to the Congressional committees. I am not unmindful
of the short notice you have received on this preposal,
If your experts cannot indicate their agreement at once,
but feel that agreement might be reached on a statement
if postponed for a week, I could inform the Congressional
committees that the technical experts of the United
States and the United Kingdom have come to n large
measure of agreement and hope to issue a joint statement
of principles within another week.
On the other hand if it should not seem feasible to
the experts of the United Kingdom to join with the experts
of the United States in issuing a Joint Statement on the
Bank within the next week or so, I shall explain frankly
to the Congressional committees that there has not been
opportunity to reach agreement with the technical experts
of all of the countries. I will then release this
statement on the establishment of a Bank for
Reconstruction and Development as representing the
views of the technical experts of the United States
and having
Regraded Unclassified
177
-5-#3077, April 17, midnight, to London.
and having the approval of the experts of a number
of other countries, but not including the United
Kingdom. I shall, of course, add that it is my hope
that after further study the experts of the United
Kingdom will see their way clear to join in subscribing
to this statement of principles.
As I must make arrangements immediately on the
matorial to be presented to the Congressional committees,
I should appreciate a prompt reply indicating which of
these courses on the Bank you would prefer. I hope you
will understand that the urgency for a decision is one
forced upon The by circumstances. END QUOTE.
HULL
(MNH)
FAM:EGC
S MNH:MCW
Regraded Unclassified
178
NOT TO BE RE-TRANSMITTED
COPY NO.
SECRET
OPTLL No. 123
Information received up to 10 д.м., 17th April, 1944.
1. NAVAL
Ten enemy aircraft attacked and dropped mines at ANZIO
on 15th. Two of them were shot down.
2. MILITARY
ITALY. Active patrolling by both sides on whole front.
Irt, Bridgehead a U.S. raid supported by tanks and artillery on
strong points at CERRETO and ALTO was successful. 61 prisoners
were captured for loss of two tanks by mines and one man wounded.
BURMA. ARAKAN. Our troops have captured some Japanese
positions four miles west of BUTHIDAUNG. In the KOHIMA area
Japanese appear to be concentrating in some strength about 15
miles east of DIMAPUR.
3. AIR OPERATIONS
ITALY. 14th. Mitchells bombed VITERBO airfield.- 121
tens and LEGHORN Railway Centre - 26 tons. Communications and
bridges in the FLORENCE/LEGHORN /AREZZO area were bombed by 139
medium and fighter bombers and stailar objectives near ROME and
in Central Italy were attacked by 278 Fighters.
BURMA. 14th. 100 Vengeances and Hurricanes attacked
objectives in the IMPHAL area.
15th. About 30 Japanese aircraft raided the landing
strip at IMPHAL damaging two aircraft. Two Japanese aircraft
destroyed and two damaged. Lightnings destroyed 6 Japanese
aircraft and damaged two on HEHO airfield MANDALAY.
Regraded Unclassified
179
April 18, 1944
9:00 a.m.
INTERNATIONAL STABILIZATION
Present: Secretary Jones
Mr. Bell
Mr. Crowley
Mr. Smith
Mr. Currie
Mr. Acheson
Mr. Collado
Mr. Eccles
Mr. Coe
Mr. Cox
Mr. Pasvolsky
Mr. White
Mr. Luxford
Mr. Bernstein
Mr. Goldenweiser
Mr. Gardner
Mrs. Klotz
H.M.JR: I think you gentlemen know why I cailed
this meeting. The technicians of your various depart-
ments have been working on an international stabilization
plan and the World Bank for, I guess, & little over a
year, and have put in a lot of good hard work on it.
I think that we, by and large, are pretty well to-
gether, at least sufficiently so that we in the Treasury
felt that if we were going to do anything this year,
we ought to do it before the political conventions.
We put the matter up to Mr. Hull and he agreed that
we should go ahead in May, and so recommended to the
President, and the President called me and said to go
ahead and do it.
Regraded Unclassified
180
- 2 -
Now, I hope I don't sound as though we had been arbi-
trary about the matter, but those of you people who have
been working on this thing over 8. year - and there have
been, literally, hundreds of meetings - that isn't an
over-statement, is it?
MR. WHITE: No, I don't think 30. Probably a couple
of hundred meetings.
H.M.JR: A dozen meetings. You said last night,
hundreds. Anyway, dozens - it may seem like hundreds -
dozens, anyway.
So we had arrived at a point where we felt that we
either were going to have to move, or abandon the plan,
pretty much, for this season. Then the fact that the
Congressman from Chicago, Dewey, had a plan which was
very much similar which would give the appearance of
doing something in this field and still wouldn't do it
right, but would give it the Republican label. Now,
that was going to come off next week.
It is very cleverly done, and he has told the people
who repeated it first-hand, that it was a part of the
Republican Party plan to get behind that thing and make
it a Party issue so they could say, "Well, we have some-
thing in the foreign field, also."
So, for those reasons, we just had to move. Other-
wise the Treasury would be up on the Hill, and the other
Departments, on a defensive basis, saying we don't like
Mr. Dewey's plan, but we haven't any plan of our own.
So, from all standpoints, we felt that it was good
for the world, good for the nation, and good for the
Democratic Party, for us to move. If anybody doesn't
like that, he can leave the room.
Anyway, that is the mood I am in. I made Acheson
laugh! Have to get B. little political around here,
Dean. Looking around the room, I think I am fairly safe.
Regraded Unclassified
181
- 3 -
MR. ACHESON: Got you worried.
H.M.JR: I can't say it in Cabinet, anyway. I have
looked around several times.
Is that right, Jesse?
MR. JONES: It is all right.
H.M.JR: Now, to be very frank, by having set a
date, first for Thursday and then Friday, because Senator
Barkley won't be here - but he is here - to go up on the
Hill, and telling our English friends that we had that
deadline, I think that we have been able to make more
headway over the week end than we have in months. I
don't think that is an over-statement.
MR. ACHESON: I think that is right.
H.M.JR: By simply saying we are going to go ahead,
with or without, we have made real progress, and we
have a very good chance that between now and Thursday
night the English will be in agreement.
I think the fact there has been a change in the
Bank of England has been helpful in making progress.
The Russians, also, are almost in agreement - - not quite.
We had something we were holding them up on. I don't
know whether the two things added up, but we were able to
say yes to the missians on something they had been pressing
us very hard on, on Friday, and I have hopes that we will
hear from them. But we are in that very difficult state.
We are going to move, anyway, with the approval of the
President, I say, and Mr. Hull. And I hope, if we can't
get the approval of you gentlemen here, at least we won't
get your public opposition. I think there will certainly
be some of you here who will go along, I hope; and if
one or two of you shouldn't, I think it isn't too much
to ask, once the President decided we go ahead, at least
we ask that we don't have any public opposition. I
don't think that is asking very much.
Regraded Unclassified
182
- 4 -
The plan is this - I mean, as to what we are going
to do this week. Thursday afternoon, people from the
Treasury, Mr. Acheson and whoever he wants to bring -
we are going up to see the Chairmen of these Committees
in the House and have a dress rehearsal with them Thursday
afternoon. I don't know just the time; the Speakers
will arrange it - 80 they will know what it is all about.
Then Friday morning we appear before four Committees
in the Denate.
MR. WHITE: Four now, yes, sir.
H.M.JR: And we are going to go there half an hour
earlier and see the Chairmen of the Committees so they
will know what it is about. Then Friday afternoon we
will appear before the three or four Committees in the
House.
And then the idea is that the publication of these
papers will be released Friday night or Saturday morn-
ing, we hope, in Moscow, Chungking, and London and
Washington - we hope.
Now that, very briefly, is it. I don't think I
have over-stated it, have I?
Would you (Acheson) care to add or subtract anything?
MR. ACHESON: No, I think you stated it as I under-
stand it.
H.M.JR: Is that accurate, Dean?
MR. ACHESON: As far as I know, that is accurate.
H.M.JR: It may seem as though we were kind of rush-
ing things, but we have to. But each one of you gentle-
men here have had representatives continuously on this
technical level committee, and they ought to be informed
about the plan.
Regraded Unclassified
183
- 5 -
Now, I wish anybody who had any questions would
either question me or anybody who is here.
Jesse?
MR. JONES: I am not very familiar with the plan. In
fact, I am very unfamiliar. I think Mr. Clayton has been
representing us, mostly, and I would like - between now
and whenever the time comes to go to the Hill - to
study it myself and get better acquainted with it.
H.M.JR: Clayton gave it & lot of time. He was
very much interested, and was very helpful in bringing
the plan into being. He made a real contribution.
MR. JONES: I will have & chance to talk with him,
but I would like to read the plan myself so I will know
what I am talking about, if I talk.
H.M.JR: I think what might be helpful - I know it
has been for me - is a series of questions and answers
which the men have here.
MR. JONES: I could have those, too, 1 suppose.
H.M.JR: Anything else that you would like to ask?
MR. JONES: No, I just wanted to study it.
H.M.JR: Don't you think, in view of these other
things happening, if we had to move--
MR. JONES: No, frankly, I hadn't attached that much
importance to the Dewey bill. I don't think it would get
very far, but you have been giving it thought, and it is
your responsibility, so--
H.M.JR: "e think it could make us a lot of trouble.
MR. JONES: I would be surprised if it did.
H.M.JR: I hope you are right.
Regraded Unclassified
184
- 6 -
MR. JONES: I have seen the bill, read the bill,
studied the bill; not much in it.
H.M.JR: Well, the people he has seen brought back
reports that make us think there will be a real effort to
get behind it. Now, maybe we are wrong. I have been
wrong before.
MR. JONES: I don't see any mistake at this time.
If I may say so, if I get any different views on study-
ing it, I will be glad to give them to you.
H.M.JR: I would like to have them.
MR. WHITE: Mr. Clayton wrote & letter in which he
resigned by virtue of his new activities, I think, about
a month ago - possibly a little before that . and Mr.
Maffry was appointed in his place. Wayne Taylor called
me up and asked me whom we would like. I said anybody
he chose would be satisfactory. Maffry is very able and
also veryhelpful.
MR. JONES: Who?
MR. WHITE: Maffry - very able and very helpful.
I think possibly Secretary Jones might be told that
what you are going up with is not the plan, but a state-
ment of general principles, which is much briefer and much
more general than the plan itself, and contains many fewer
items about which there could be disagreement at this
stage; leaving for 8. later stage a discussion on & number
of important details. But this is merely a statement of
principies on which we could get various Governments to
agree, at this time.
MR. JONES: Is this to acquaint the Committees, or
the Chairmen of these Committees, with what we plan to do?
Is that it?
MR. WHITE: Partly that, and partly to acquaint them
with the fact that the discussions of the technicians,
Regraded Unclassified
185
- 7 -
which have been going on with the various countries for
8. year, now, have emerged in agreement on these points.
And I think that when you have had an opportunity to read
the statement of general principles, you will find that
they are much simpler to agree on at this time than
would be a specific plan which was submitted about & year
or two ago as a basis for discussion.
MR. JONES: Have you digested it in short form?
MR. WHITE: It is four or five pages, but we can
digest it further.
MR. JONES: That is not too much.
MR. WHITE: We can distribute them here, or--
H.K.JR: When it is over.
Mr. Crowley?
MR. CROWLEY: I think Harry has answered the question
that I had back in my mind, that what you are going to do
is to go up and acquaint the members of these Committees
with what you are contemplating doing, and then later on
you would have a bill drafted to be introduced. Is that
correct?
MR. WHITE: No, there was no contemplation of any
bill at this time.
MR. CROWLEY: No necessity for any legislation?
MR. WHITE: I assume that the program is not to
present it formally before Congress at all, unless there
is 8. formal conference that has presented a specific plan.
At this stage we only have a set of principles which we
have been able to get agreed to by the various countries.
MR. CROWLEY: On the Dewey thing, when we were up
before Foreign Relations on UNRRA, I guess it was, Dean,
Dewey was complaining quite bitterly that they had passed
Regraded Unclassified
186
- 8 -
him by in demanding a hearing on his bill. Then when we
went up on Lend-Lease extension, he called and again com-
plained about it. Oh, I presume he has called me eight
or ten times to complain that we were all giving his
bill the run-around. So there is some merit in recogniz-
ing that he is insisting upon 8. hearing on his bill.
MR. WHITE: He is also lining up some very substan-
tial support among certain banking groups, and among the
Republicans. At least he boasts of that. Whether that
comes from him, personally--
MR. CROWLEY: I don't think he would get anywhere, but
he has a value up there of promoting these things and
getting publicity - especially he gets 8 world of publicity
out of it in Chicago.
MR. WHITE: I think possibly it has been & little
misleading to assume that the motivation for action on
this has been solely the Dewey bill. That has been one
of the factors, immediately, but the prime motivation has
been to get something done this year, if possible; and
if it is to be done this year, I gather that the Secretary
felt it should take place before the Convention.
MR. CROWLEY: Would it take legislation to put the
World Bank in existence?
H.M.JR: Oh, sure.
MR. WHITE: It will have to come before Congress
for final action, and that may not be this year.
MR. BELL: Is that & contemplated bill, or a treaty?
MR. LUXFORD: It may be the arrangement on UNRRA -
about the same setup you had on UNRRA - but it will clearly
require Congressional approval before it is finally brought
into effect.
H.M.JR: Mr. Acheson?
Regraded Unclassified
187
- 9 -
MR. ACHESON: Are you going to talk with the Committees
about your plans from here out, in this connection, or just
going to talk about the nature of these principles?
H.M.JR: I thought we would tell them everything we
had in mind. I thought we would be prepared to tell them
everything.
MR. ACHESON: That you hope to go on to some meeting
in May?
H.M.JR: I wanted to be just as frank with them as I
would be with this group. That is what I think we should
do. I don't know whether you agree.
MR. ACHESON: Yes, I do.
H.M.JR: And then I want to be familiar with just
what arrangement the State Department has made for
Congress to participate. I would like to have that ex-
plained to me 80 that if they ask, "Well, how will Congress
be kept informed?" - I think we ought to have a plan. I
don't know just what you people have decided on over there.
When you have one of these conferences, how will Congress
participate?
MR. ACHESON: I don't think that has reached the
stage of perfection.
H.M.JR: They are going to ask us that, you know.
Do you think, between now and the time we go up, we could
sort of agree? I would like to go at least as far, and
it might be embarrassing to you if I went further.
MR. ACHESON: I think we could talk it over.
H.M.JR: I think there ought to be some kind of 8.
plan - if you hold these conferences, just how do we
invite Congress to participate. Frankly, I am not
familiar with what the State Department has in mind.
Could we clear that up before we go up, because I know
they are going to ask us that question?
Regraded Unclassified
188
- 10 -
MR. ACHESON: Yes, indeed. So do I.
MR. JONES: May I ask - I don't think I quite got it
in the beginning - about what Committees, or who would
constitute the Committees we propose to see on the Hill?
H.M.JR: These Committees that we propose to see -
I went up once before and I can't name them all, but I
know Banking and Currency, both in the Senate and the
House, and the Committee that deals with Foreign Affairs,
and there is a Post-War Committee, and in the House,
Weights, Coinage, and Measures - is that about it?
MR. WHITE: Yes, and the Ways and Means Committee
was there last time. Because it involved an appropria-
tion, they felt they wanted to be in on it.
MR. JONES: Do you plan to have one meeting?
H.M.JR: No, we get up here before these four
Committees in the Senate in the morning, and appear
before corresponding groups in the afternoon.
MR. JONES: But the four Committees sitting as one
Committee?
H.M.JR: Yes, that is what they did last time.
MR. JONES: That is Foreign Relations?
H.M.JR: Having to do with Foreign Affairs, Banking
and Currency, Post-War, Weights, Coinage, and Measures -
and last time there was Ways and Means and Finance. But
it is being arranged through Barkley and Rayburn, who
are handling it. And in each case we were going to see
the Chairmen in advance to explain to them what we had
in mind.
MR. JONES: I see.
H.M.JR: But we had & surprisingly good turn-out
last time. I don't know whether we will this, or not.
Anything else?
Regraded Unclassified
189
- 11 -
MR. ACHESON: No.
H.M.JR: Mr. Eccles?
MR. ECCLES: Do you expect to release the statement
prior to meeting on the Hill - this statement of principles -
or is it to be released after?
H.M.JR: It is supposed to be eight o'clock Friday
night.
MR. ECCLES: And you expect to appear on the Hill
Friday?
H.M.JR: That is right.
MR. ECCLES: That would be this statement of princi-
ples which has been prepared and which has been submitted
to these other countries for their approval?
H.M.JR: That is right.
MR. WHITE: Not to all of the countries - the British -
we would have liked to have submitted it to all the countries.
We are submitting 8. briefer statement, an outline, to all
the countries, but the British representatives were very
insistent that we not submit them to various countries.
They were afraid, they said, of a leak.
MR. ECCLES: The announcement of the conference would
be made publicly, not at the time that you meet on the
Hill, I suppose.
MR. WHITE: No, no, because there are a couple of
hurdles to cross before that occurs. we have not yet got
an agreement with the British to have & conference. That
discussion will take place immediately after agreement
to publish the document.
MR. ECCLES: So that the first step is meeting with
the Committees of Congress and presenting the statement
of principle, and then releasing the statement. So far
Regraded Unclassified
190
- 12 -
as the conference is concerned, that will still be in
abeyance, depending upon developments.
MR. WHITE: Though I presume they will ask the
Secretary and he has said he will tell them exactly what
he has in mind - he will tell them he hopes to have the
conference, but the decision to have it has not yet been
made if other Governments, the British Government,
would have to be a party to that decision. They have
not yet agreed to a conference. They have taken the
position they could not agree until the Parliament has had
an opportunity to discuss the principles, so that even
if they personally felt a conference should be held, they
could not let Parliament learn that they had made such
a commitment; because presumably Parliament wants to dis-
cuss the matter and make such suggestions, or give such
instructions as they see fit before a conference is
decided upon.
Therefore, the Dritish will not tell us officially
that they are ready to participate in a conference until
after there has been an opportunity for debate. They
have promised to have a debate on these principles, if
they finally agree - and we have not yet obtained their
final agreement - within the week after the publication
of the documents. They are going to set aside, I think
they said, one day for discussion in Parliament. After
that discussion they will be in a position to indicate
whether or not they wish to participate in & conference.
MR. ECCLES: The conference, I assume, would discuss
not only the general principles which would be included
in the statement, but the minute details of the plan
that they would be willing to recommend to their Govern-
ments.
MR. WHITE: Yes, the conference would have as an
assignment, I presume, the formulation of & plan. They
would go into as much detail as the conference members
thought was necessary to formulate the kind of plan, which
would then be discussed by the various parliaments and
Congress here, for acceptance or rejection.
Regraded Unclassified
191
- 13 -
MR. ECCLES: So that the plan upon which this state-
ment of principles has been developed might be modified
at the conference; so that 80 far as this Government is
concerned, the uitimate plan would first depend upon the
plan that might come out of the conference, and then,
secondly, a plan that the Congress would finally authorize
by legisiation.
MR. WHITE: Yes. I am not sure of the first; the
second, certainly. The first plan that would emerge from
the conference would have many things that are not stated
in the principles and may take the form of many provisions
quite different from anything that has hitherto been
decided. However, the plan will have to contain the
principles which are indicated in this general statement,
unless there is complete agreement that they shall be
modified.
In other words, the Americans and the British, and
any other - well, not any other, but the Americans and
the British, and if they join, the Russians and the
Chinese, have agreed that they will not initiate or
support any measure or provision which is contrary to
the principles which are stated here.
MR. ECCLES: So that the development, as a result of
the conference, would have to fit within the framework
of those principles, unless there v.a.s a unanimity of
agreement on the part of the four principals.
MR. WHITE: That is a good way to state it - exactly.
And you remember we had decided to do that in order to
assure success of the conference.
We couldn't go into conference during war with a
possibility of failure, so we thought we would iron out
the major differences ahead of time so that the conference
would be certain to emerge with a plan that would have
been agreed upon by the major parties.
MR. ECCLES: Then I take it that there is a desire
on the part of this Government to have the legislative
Regraded Unclassified
192
- 14 -
representatives participate in the development of this
plan.
MR. WHITE: well, I judge that that is the general
desire. Certainly Secretary Morgenthau has expressed
it, and I gather the State Department - to bring Congress
along with them as much 8.8 possible and to get their
ideas as much as possible in the shaping of the document.
MR. ECCLES: So that whatever plan is developed would
have some chance of successful action in the legislature.
MR. WHITE: That is right.
MR. ECCLES: So that in going up there on Friday, it
would seem to me that the plan - the detailed plan that
has been discussed among the technical experts - would not
get into the discussion, necessarily, before the Committees.
MR. WHITE: I should be surprised if it did, other
than there would be, I would presume, a number of questions
and doubtless there would be some comments by some of the
members which would be favorable, and some that might be
unfavorable. But it certainly wouldn't be appropriate
or likely that they will then hold the equivalent of
committee meetings on the individual provisions.
MR. ECCLES: I would think it unfortunate if a
discussion of the detail of the plan that is still so
remote, because it is a matter for the discussion of the
conference, should get into 8. controversy before the
Congress at this time.
MR. WHITE: I should think it not only would be un-
fortunate, but would create an impossible situation, be-
cause there are so many details, and it takes toolong to
discuss them, that it would be a most complicated and
extended affair.
However, I think - I shouldn't want my comments to
be misinterpreted, and I am not sure I get the full force
of yours, Marriner - it should be clear that the principles
Regraded Unclassified
193
- 15 -
which are agreed upon among the various countries will
not be altered before the conference, because those
are principles--
MR. ECCLES: I understood that. That is why it
wouldn't serve any useful purpose for the Congress to
begin discussing the detail of 8. plan at this time -
& plan that hasn't been agreed to yet by the conference.
MR. WHITE: That is right. After the conference
makes & plan, then I presume that Congress will study
it carefully and discuss it endiessly at some period
before it is accepted.
MR. ECCLES: I was going to say, with reference to
the Dewey proposal - of course, he proposes a definite,
specific plan, a program. I don't take that very
seriously, personally. I think that he has no chance
whatever of getting anywhere. I don't believe anybody
is going to take it very seriously. They may use it
politically, but it is done pretty largely to help put
water on his own political wheel - to get a little
publicity, I think, primarily. I think the purpose of
the thing is that, without any expectation of every getting
anywhere.
MR. WHITE: You may be right. That is certainly
what we thought to begin with.
H.M.JR : Excuse me a minute. If there isn't any-
thing else - unless somebody has something else, I tuink
we will go ahead. But if, between now and Friday, any-
body has any suggestions to make, I would be most pleased
to receive them.
So I think, unless somebody has something else -
you all have a lot of work to do and we might as well
stop.
Regraded Unclassified
194
April 18, 1944
10:15 a.m.
DISCUSSION WITH STATE DEPARTMENT
Re: INTERNATIONAL STABILIZATION
Present: Mr. Bell
Mr. White
H.M.JR: After this meeting, Mr. Bell, Mr. White,
Mr. Acheson, Mr. Pasvolsky, and Mr. Collado stayed, and
we discussed how we could go ahead.
Out of the various discussions came this, that Mr.
Acheson said that he thought that--I first said that I
wanted the cooperation and help of the State Department.
Mr. Acheson said that he thought that inasmuch as this
would be the first real world conference, invitations
should go from the President to the heads of the various
members of the United Nations saying that he had appointed
as the head of the U. S. delegation the Secretary of the
Treasury, and that the President hoped that each of these
governments would appoint their principal financial person,
whoever he was, to attend a conference. I said that was
entirely satisfactory to me.
Then we got on to the discussion about the Hill, and
to my surprise the State Department had not yet thought
the thing through; and out of this discussion came, "Should
Members of Congress be appointed by the President on the
American delegation?"
After considerable discussion, in which I had to do
my own original thinking, it was decided that we would
send a joint telegram tonight to the President, signed by
Hull and me, recommending that the President authorize us
to say on Friday that if such a conference took place, he,
the President, would appoint Members from Congress as
delegates to the American delegation. I, for my part,
felt that the State Department's attitude was very
cooperative and sympathetic. I mean, I felt it was a very
nice atmosphere.
Regraded Unclassified
195
- 2 -
MR. WHITE: I wonder whether he said this was the
first world conference, or the first world conference of
United and Associated Nations. There have been other
world conferences.
MR. BELL: Not during Roosevelt's administration.
H.M.JR: No, he said that Roosevelt had not called B.
real world conference since he had been President.
MR. WHITE: I thought you said this was the first
world conference.
H.M.JR: No, during Roosevelt's administration. And,
also, Mr. Pasvolsky said this was so important for the
British because when the British made up their mind what they
were going to do on this one, they would have to decide
whether they were going to really join with us on the United
Nations basis, post-war economic problems, or whether they
were going to go their own way. This was a terrifically
important decision for them to make.
MR. BELL: By the way, isn't there a meeting of the
Dominion Ministers in London?
MR. WHITE: There has been. They called a meeting of
the Dominion Ministers to discuss Article Seven, which is
the post-war economic policy, and that included these
monetary discussions, and they were discussed in London for
a month.
H.M.JR: I, as you notice, cut the thing B. little
short, because what I was worried about was that Eccles
might say something that would throw the whole meeting
into an uproar. You were being too kind to him, so I
didn't--
MR. WHITE: That is all right.
H.M.JR: I didn't think there was anything to be
gained. Eccles was on a fishing expedition. He knew his
stuff. He knew what he was talking about.
Regraded Unclassified
196
- 3 -
MR. BELL: He was very cagey, I thought, by asking
questions.
MR. WHITE: The reason I wanted to correct him was
that I thought he was going to report back to his Board
that the Congress was going to shape the principles upon
which the Fund was going to be created.
I was a little bit afraid he was going back to his
Board and tell them, "You boys don't have anything to
worry about. This is just a statement of principles, and
Congress is going to consider this and rehash it long
before it gets into any form, so don't get concerned
about it. And then later he might say, "Well, I thought
you told us that Congress would have something to do with
the shaping of this declaration before it was agreed upon."
Well, of course, that isn't true about the principles. If
the principles are agreed upon, we can't change them
unless it is done by unanimous consent.
MR. BELL: That is one question you are probably
going to have to answer Friday. You are going to have
this conference and agree on plans. Now, is it going to
be in such shape that Congress can't change it when you
come up here for legislation?
MR. WHITE: Well, the answer is that they will have
their representatives on the Committee who will help to
modify it, but the real answer to your question is, "No,
they won't be able to change those principles." They
either accept it, or reject it, or accept it and reject it
with certain major amendments which then would have to go
to the other countries.
MR. BELL: Your best answer will probably be that if
the Congress accepts it with amendments, those amendments
will have to go back to the other countries as signatories
of the plan.
H.M.JR: All right?
MR. WHITE: Yes.
Regraded Unclassified
197
- 4 -
H.M.JR: I thought we went as far as we could this
morning.
MR. WHITE: I thought it was an excellent meeting.
H.M.JR: Somebody has to do something about the
Federal Reserve, though.
MR. WHITE: I think the time we can do some work
with them is after the conference.
MR. BELL: The trouble is, Eccles talks 80 much.
He talks 80 much outside privately and off the record.
MR. WHITE: I presume it won't be necessary to write
this little meeting up.
H.M.JR: Your presumption is correct.
Regraded Unclassified
198
April 18, 1944
TELEGRAM FOR THE PRESIDENT FROM THE
SECRETARY OF THE TREASURY
I have made arrangements to appear before the appropriate
Congressional committees on Friday, April 21, to discuss the
joint statement of technical experts of the United Nations on
the establishment of an International Monetary Fund. The
Treasury has planned the release of the joint statement to the
press at 8:00 p.m., April 21, Washington time for Saturday
morning papers, and it is anticipated that the statement will
be released in London as well as possibly Moscow, Chungking,
and some of the American republics and British Dominions.
Although no final discussion can take place with the British
regarding the convening of an international conference on the
monetary fund and bank proposals this spring pending discussion
of the matter early next week in the British Parliament, I pro-
pose to tell the Congressional committees frankly of our desire
to call such a conference if circumstances permit. In this
connection the members of Congress are certain to ask questions
regarding the composition of the United States delegation and
particularly the participation of the Congress in the conference.
Secretary Hull and I would recommend that I be authorized to
state that you would probably appoint a delegation to be headed
by the Secretary of the Treasury and including, among others,
representatives of both houses of Congress. We believe it very
important that 8. statement be made of your intention thus to
invite direct Congressional participation in the work of the
United States delegation to the conference if it is convened.
We both believe that such a statement to the Congressional
committees will be of the greatest importance in getting the
proposed conference off to a good start with the Congress and
request accordingly that, if you approve, you authorize me to
make the suggested statement to the members of Congress.
Secretary Hull approves this telegram.
Regraded Unclassified
199
April 18, 1944
10:20 a.m.
FINANCING
Present: Mr. Bell
MR. BELL: This is a letter to the President on
the basket of securities for the Fifth War Loan Drive.
(Secretary signs letter.)
MR. BELL: You sign two, you know. It goes over in
the original and duplicate. If the President approves
both, one stays in his file, and one comes back.
(Secretary signs copy of letter.)
MR. BELL: Charlie Bell is being designated on this
Deferment Committee in the place of Norman Thompson.
(Mr. Bell hands the Secretary & letter addressed
to Mr. Charles Bell, dated April 17, 1944, which the
Secretary signs.)
MR. BELL: There are two letters there, too.
H.M.JR: God, I have never done this before. Why
do I have to sign this thing to the President twice?
MR. BELL: Yes, you have to.
H.M.JR: No, sir. I have been signing stuff all
week, only one copy.
MR. BELL: Well, you see what this is--this letter
goes over, and the President puts his approval on the
back of it.
One time they didn't take the carbon off, and Forster
made a rule over there that hereafter it will come over
Regraded Unclassified
200
- 2 -
in duplicate, and the President will sign both, one to stay
in the files as approved copy, and the other to come back
to you. That has been within the last sixty days.
You sent me a note on Gordon Rentschler. Do you
know what he has?
H.M.JR: He has a plan where he is increasing his
deposits a million dollars a week.
MR. BELL: Out of hoarded money?
H.M.JR: Yes.
MR. BELL: Well, I think we might look into it and
see whe we can do.
H.M.JR: Cy Upham most likely hasn't much to do, and
they might sort of follow through on & thing like that.
I haven't talked to Cy.
MR. BELL: Gordon, I suppose, will be glad to tell
it.
H.M.JR: Oh, yes.
MR. BELL: It is a wonder Burgess doesn't put it up
to the Reserve Bankers.
H.M.JR: I think he has something else he is going
to do.
MR. BELL: Who, Burgess?
H.M.JR: Yes. I don't know just what it is. He had
another something in this connection, but this is something.
They said they started last December, and it has gotten 80
they feel they are getting a million dollars of hoarded
money a week in new deposits.
If they like it and can get it and sell it to the
country, let Cy Upham go to work and have it as his baby,
and let the other banks do likewise.
Regraded Unclassified
201
- 3 -
MR. BELL: O.K. All right, I will see.
H.M.JR: I was working with Rentschler to try to
help him get a man to set up surplus property. I have
offered it to Aldrich. He wants to come.
MR. BELL: It is up to the Board? I think he will
be a good man.
These people out in Minneapolis asked you to make a
speech, and apparently you wrote them and said you would
suggest or give them a substitute.
H.M.JR: No, this is their own idea.
MR. BELL: Well, they said it was very kind of you
to arrange for a substitute. I suppose Smith put something
like that in. They ask if I can come. I have turned down
a couple so I feel a little embarrassed about accepting
this right on top of it. I turned down the National Savings
and also the Missouri Bankers Association.
H.M.JR: It is purely up to you. There is no pressure
from me.
MR. BELL: I don't think I want to go up there during
the Drive.
H.M.JR: That is the way I felt.
MR. BELL: Well, we can send them somebody. That is
all you care?
H.M.JR: Yes.
Regraded Unclassified
202
OFFICE
TREASURY DEPARTMENT
WASHINGTON
THE
SECRETARY
APR 18 1944
Dear Mr. President:
Subject to your approval, I propose to offer for cash sub-
scription, under authority of the Second Liberty Bond Act, as
amended, an additional issue of the 2-1/2 percent Treasury Bonds
of 1965-70, an issue of 2 percent Treasury Bonds of 1952-54, and
an issue of 1-1/4 percent Treasury Notes of Series B-1947. At
the same time I propose to offer for cash subscription an issue
of 7/8 percent Treasury Certificates of Indebtedness to mature
June 1, 1945. All of these securities will be dated June 26,
1944, except the 2-1/2 percent Treasury Bonds of 1965-70, which
are dated February 1, 1944.
These four issues, Series E, F and G savings bonds, and
Treasury savings notes, will constitute the securities available
in the Treasury's Fifth War Loan Drive, with an objective of
$16,000,000,000 to be sold to nonbanking investors. In general,
the terms and conditions of the new securities will be similar
to those sold in previous drives, and the amount of securities
to be issued will not be specifically limited. I propose to
start the drive and make the new securities available for sub-
scription on June 12. I am planning to permit commercial banks
holding savings deposits and time certificates of deposit to
make a limited investment in the two Treasury bonds concurrently
with, but not as a part of, the drive.
The authorizing act provides that bonds and notes may be
issued only with the approval of the President. Accordingly,`I
trust that the proposed issues will meet with your approval.
Faithfully yours,
Secretary of the Treasury.
The President,
The White House.
APPROVED:
4-21-44
Regraded Unclassified
203
THE NATIONAL CITY BANK OF NEW YORK
CHAIRMAN
OF THE BOARD
April 18th, 1944
Dear Henry:
I am sending this along
because I think you would like to use
a National City Bank blotter when you
start work on June 12th.
Ever Euton incerely,
The Honorable Henry Morgenthau,
Secretary of the Treasury,
Washington, D. C.
204
The Fifth War Loan
To Our Depositors:
The United States Treasury has announced that the Fifth War Loan Drive will open
on June 12 and continue through July 8, 1944, offering the following securities:
MARKETABLE ISSUES
SAVINGS BONDS and NOTES
(Interest will accrue from June 26)
(All purchases between June 1 and July 31, 1944, will be
1/8% Certificates of Indebtedness due June 1, 1945
credited to the Fifth War Loan)
1 1/4% Notes due March 15, 1947
Series E War Bonds yield 2.90% if held 10 years
2% Bonds due June 15, 1954, callable June 15, 1952
Series Fand G Savings Bonds yield 2.50% if held 12 years
2½% Bonds due March 15, 1970, callable March 15, 1965
Series CSavings Notes yield 1.07% if held 3 years
You and your friends are cordially invited to purchase these securities
through any of our offices
The National City Bank of New York
Regraded Un
205
April 17, 1944
Memorandum to All Officers
Re: Fifth War Loan Drive
June 12 - July 8, 1944
A blotter (sample attached) announcing the terms of
the Fifth War Loan securities will be enclosed with our April
month-end statements to depositors, including special checking
accounts.
The National City Bank Fifth War Loan circular will be
available on or before the first of May. As before this will
include an order form on the back page.
Because of the early announcement and the fact that
many of you will be writing your customers enclosing our descrip-
tive circular, we shall probably eliminate the President's letter
to all depositors. However, we may enclose our circular or some
official circular, if acceptable, in statements to metropolitan
customers at the end of May.
Pending the printing of our descriptive circular we can
obtain a further but limited supply of Federal Reserve circular
2784, the Treasury's original announcement of the Fifth War
Loan drive, which many of you have already used in writing to
your depositors.
DIC Pfeffer DK Pfef few
D. K. Pfeffer
Vice President
Regraded Unclassified
206
April 18, 1944
Ted Gamble.
Secretary Morgenthau.
A year or two ago, the actor Danny Kaye
offered his services to the Treasury in any
capacity that we might use him. I saw him last
night in a picture and he was most exceptional.
I am sure that Hollywood now ranks him amongst
the best stars. It may be too late but I wish
you would get in touch with him for the Fifth
War Loan and see whether you can get him to go
around the country because the man is certainly
one of the country's great comedians. Please
let me know what happens and if you can't reach
him, I know how to reach him.
Fib- Per Hyn 5/6/14
Regraded Unclassified
207
April 18, 1944
10:32 a.m.
Operator:
Mr. Pehle.
HMJr:
Who?
Operator:
Oh, you want Mr. Gamble, don't you? I'M sorry.
HMJrt
Gamble, I said.
(Pause)
Ted
Gable:
Hello, Mr. Secretary.
HMJr:
Ted, you called me last night.
0:
Yes. I wanted to just report to you about our
bankers meeting
HMJr:
Oh.
0:
in Chicago.
HMJr:
Yeah.
0:
We had an excellent meeting. They had about
twenty-five of their top committee people there.
HMJr:
Good.
G:
And we went all over this Fifth War Loan very
thoroughly and they have adopted what I think
1s a good program.
TWIN
Good.
G:
They're putting it all in writing; how we're
going to get out a special manual which the
A.B.A. is going to get out. They've agreed to
set up a special committee in every State.
We're getting out a report form 80 that each
bank will make a report on how thoroughly they
do this job in the Fifth War Loan. And it looks
very good. I just wanted you to know that.
HMJr:
Well, I'm delighted.
G:
Because it's definitely a "plus" item for us.
HMJr:
Good.
Regraded Unclassified
208
- 2 -
0:
We had a. memorandum
HMJr:
I'd like to know what the banks are going to
do. When you get the memo, I'd like to see it.
G:
All right, sir.
HMJr:
I'm sure Mr. Bell will, too.
0:
Well, he will and I've already told him that
we had B very successful meeting and Mr. Wiggins
wanted me to assure you that they'd do everything
possible to see that we got the kind of action out
of them in the Fifth Wer Loan that we were entici-
pating.
T/Jr:
Good.
C:
That was all I wanted to tell you.
HMJr:
That's good news.
3:
All right, sir.
HMJr:
Is everything else all right?
0:
Well, yes. There are a couple of matters I
think we ought to settle in the next two days
when you get a minute or two. We ought to talk
about the slogan and then we ought to talk about
your participation in the Fifth War Loan before
we start on our
HMJr:
Well, you'd better -- I'll tell Fits to put you
down because I'm concentrating everything on
going up on the Hill.
G:
Yes.
HXJr:
Well, now, I'll see if I can work you in.
is
Because, see, we start our regional meetings this
week-end.
HMJr:
All right.
C:
All right, sir.
HMJr:
Right.
Regraded Unclassified
209
April 18, 1944
10:34 a.m.
Wright
Patmen:
Mr. Secretary.
HMJr:
Talking.
P:
This is Wright Patman.
HMJr:
How are you?
P:
Fine. I hope you're all right.
HMJr:
I was never better.
P:
That's good. Well, while you were away, I
phoned down and left just as cordial an invita-
tion as was possible to extend for you to open
up your Fifth War Loan Drive at the middle and
the heart of the Gulf Southwest.
HMJr:
Yes.
P:
You got my message, I hope.
HMJr:
I sure did and our mutual good friend, Sam
Reyburn called me up yesterday.
P:
He told me he was going to.
HMJr:
And he said he would like me to go and I'm
giving it very serious consideration.
P:
Well, it's all right for you not to say that
you'll do it right now because I have some other
invitations I want to come in.
HMJr:
Yes.
P:
But I sure want you to do It, Mr. Morgenthau.
HMJr:
Let me'ask you. Do I understand that If I went
there, you can get the five Governore to come?
in
I feel reasonably certain that we can.
HMJr:
I see.
P:
And anyway we'll have a banquet there that night
of the Directors of the Gulf Southwest
Regraded Unclassified
210
- 2 -
HMJr:
Yeah.
P:
and they are the most prominent people in
those five States.
HMJr:
Yes.
is
That's business and civic and industrial leaders.
HMJr:
What do you call them -- Gulf
P:
The Gulf Southwest Agricultural and Industrial
Conference.
HMJr:
I see.
F:
It's quite a big organization and composed of the
most prominent people. John W. Carpenter 18 the
head of it.
MJr:
T sec.
P:
He sent you D. telegram.
HW:
Well, I know you fellows have beating up the
tom-toms.
P:
Yes, sir.
HMJr:
(Laughs)
P:
And we just must have you, now, because you see
the Southwest has a little glamour and romance
that you don't find elsewhere, we think.
H/Jr:
I'm sure you're right.
P:
And we're just depending on you.
HMJr:
Well, I feel very much complimented and I'll make
up my mind in the next day or two. I want to talk
with Gamble about it.
P:
All right, sir. Well, I hope it's "yes".
HMJr:
Well, I feel very much complimented.
P:
Well, thank you, sir.
HMJr:
All right.
P:
Good bye.
April 18, 1944 211
10:43 a.m.
HMJr:
Outside of my window there is a great big healthy
man cutting the lawn with a gasoline engine. Now,
if they 've got to cut the lawn with a man, he can
either push it -- I'm not going to have them use
up gasoline outside there.
Charles
Bell:
I see.
HMJ:
It's perfectly ridiculous. I mean, he's just
hanging on to this mower with the gasoline engine.
B:
Riding around.
HMJr:
This grass around the Treasury -- if they're going
to take manpower, they can either push & lawn
mower or I don't -- just let the damn gress grow.
B:
All right, sir.
HMJr:
But I'm not going to have both a man and E. gasoline
motor.
B:
All right, sir.
HMJr:
Please.
B:
Okay, sir.
Regraded Unclassified
212
April 18, 1944
11:38 a.m.
HMJr:
Yes.
Operator:
All right. Mr. Taylor.
HMJr:
Hello.
Myron
Taylor:
Good morning.
HMJr:
Hello, Mr. Taylor.
T:
I understand our negotiators are getting on very
well.
HMJr:
So I hear.
T:
Now, I was talking with the Secretary and made
that report to him this morning. I spent the
evening with Sir Herbert and Mr. Pell and Mr.
Malin last night.
HMJr:
Right.
T:
And Sir Herbert is leaving here Friday. They are
preparing some kind of press release.
HMJr:
Yes.
T:
And I should suggest that in a press conference,
it be limited to Sir Herbert and Pehle. What do
you think?
HMJr:
It's all right with me.
T:
I mean, the suggestion was made that someone
representing the Secretary should be present.
HMJr:
Oh.
T:
I think that expands the field too much. I talked
with him about that this morning. He thinks 80,
too.
HMJr:
Well, if that's his wish. I -- I have discussed
this and I thought that Mr. Hull might like to
associate himself with it. That was....
T:
Well, I don't think at the moment he needs to do
that. I mean, that's his view.
Regraded Unclassified
213
- 2 -
HMJr:
Well, that -- does that -- that's all that's
....
T:
Yeah. Well, now, one thing that we did discuss,
and I think that's quite important -- I had him
meet Sir Herbert again last week.
HMJr:
Yeah.
T:
He met him four years ago when he was here.
HMJr:
Oh, yes.
T:
And they had a talk about this thing, which was
quite satisfactory. He's leaving Friday, and I
suggested to the Secretary that Sir Herbert come
in again with Pehle tomorrow
HMJr:
Yeah.
T:
and that if you and Secretary Stimson could
.... stop here at nine-thirty on your way down -- he's
going to phone you to that effect
....
HMJr:
Who 18?
T:
The Secretary.
HMJr:
I see.
T:
Through his office -- I think that would give it
a - proper wind-up. I
....
HMJr:
Well, if - if that 1s what Mr. Hull wants, I'd
be delighted.
T:
Well, don't you think that's good?
HMJr:
Uh - yes. Yes, but if - but - he'll have to let
me know fairly soon.
T:
Well, I think that he's - he told me nine-thirty
would suit him very well.
HMJr:
Well
T:
His office 18 going to call you very soon -- this
is a little advance information.
HMJr:
Well, uh - I think the more -- how should I say --
window dressing that we can give it -- referring
to myself as window dressing -- I think the better.
Regraded Unclassified
- 3 -
214
T:
I don't -- this isn't for press purposes.
HMJr:
Oh!
T:
This 18 just a private meeting to have these men
who have been working for your committee
....
HMJr:
Yeah.
T:
....
and our committee
HMJr:
Yeah.
T:
....
report the results.
HMJr:
Well, I - I
....
T:
It won't take fifteen minutes.
HMJr:
Well, I -- I know fifteen minutes -- I'd be
delighted.
T:
Well, you'll hear from me.
HMJr:
Thank you.
T:
And I'll see you then.
HMJr:
Thank you.
T:
Thank you very much. Oh -- hello?
HMJr:
Yes.
T:
The cash side of this thing 1s one that we've got
to work out today, and -- the original two-million
dollar commitment still stands, BO I assume, because
Winant gave that commitment to the -- to Sir Herbert
and to the British.
HMJr:
I'm not familiar with that.
T:
Yeah. Well, will you look into that a bit?
HMJr:
I will.
T:
Because it's coming out of the fund that we've
discussed in your office -- the other day -- avoiding
the necessity for putting it in there -- in the
budget anywhere -- appropriation.
Regraded Unclassified
215
- 4 -
HMJr:
I'll - I'll familiarize myself with it.
T:
All right.
HMJr:
I appreciate your calling me.
T:
Thank you.
HMJr:
Thank -- hello?
216
April 18, 1944.
Dear Mr. Ezekiel:
This is to thank you for sending
me, on April 5, a reformulation of the
Secretary of State's recent general policy
statement. I look forward to reading it
with interest.
Very truly yours,
(Wigned) E. Morgenthon, Jr.
Mr. Mordecai J. B. Ezekiel,
Economic Advisor to the Secretary,
Room 218, Administration Building,
Department of Agriculture,
Washington, D. C.
Regraded Unclassified
217
Dear Mr. Ezekiel:
This is to thank you for sending
me, on April 5, & reformulation of the
Secretary of State's recent general policy
statement. I shall read it with interest.
Very truly yours,
Secretary of the Treasury.
Mr. Mordecai J. B. Ezekiel,
Economic Advisor to the Secretary,
Room 218, Administration Building,
Department of Agriculture,
Washington, D. C.
Just
JWPehle:1hh 4/17/44
Regraded Unclassified
OFFICE OF
218
THE SECRETARY OF AGRICULTURE
D
April 5. 1944
Mr. Morgenthau:
Recent discussions with friends on
their reactions to Mr. Hull's
recent general policy statement led
to an attempt to reformulate these
ideas in terms of what they mean to
the ordinary people in enemy or
occupied countries.
This draft attempts to reassure
people abroad and here as to what
they can look forward to after the
Allies win. This is submitted for
any use that you might care to make
of it.
M.E.
M. Ezekiel
Attachment
John Pelle:
Ld
DRAFT
219
4-5-44
TO THE PEOPLES ENSLAVED BY DICTATORS, INCLUDING THE INHABITANTS
OF GERMANY AND JAPAN:
This statement is issued jointly by the leaders of England,
the Soviet Union, and the United States, after consultation with
one another.
I. We are fighting to destroy the dictators who have
enslaved you. We are not fighting to destroy the
peoples whom they have enslaved and menaced all over
the world.
II. We will fight until the dictators have surrendered
unconditionally.
III. After the dictators surrender, we will start at once
to help you reconstruct a world in which you and your
children can live with dignity, honor, prosperity,
and freedom.
IV. To this end we will see that those political parties
which have supported the dictators and which have
have preached destruction, hate, and enslavement,
are rooted out and rendered harmless. All individuals
in those parties who have been responsible for crimes
of terrorismand destruction will be turned over to
you to be punished through courts of your own choosing.
They will be held in the custody of the armies of
occupation until you have established your own local
governments and courts capable of dealing with them.
V. No member of the Fascist parties shall be permitted
to retain any of the property which has been looted
from you or from the citizens of the countries which
have been enslaved. So far as possible, that property
shall be returned to the individuals from whom the
Fascists stole it. Where such individual restitution
can not be made, the property will be used for public
purposes. The homes, the businesses, and the occupa-
tions of the enslaved peoples shall be restored to them.
VI. As promptly as Fascist elements have been eradicated
from your lives, you will be given the opportunity
to establish local government organs by democratic
processes, for municipalities, towns, villages, and
counties.
VII. You will be permitted to establish whatever form of
government you select 80 long as it is based on the
will of the people, provides for free elections, free
speech, and religious freedom of worship, and insures
Regraded Unclassified
220
- 2 -
against the creation of new dictatorships.
VIII. You will be aided to reestablish your production
of food and industrial products as promptly as
possible after the fighting stops. Relief food
will be provided to check actual starvation, but
after that your future food supply will depend on
your own efforts, We will do all that is necessary
to assist you in the rehabilitation of your agriculture
and industry as promptly as possible.
IX. The United Nations will undertake the responsibility
of supervising the transportation and public utilities
in your area, and will operate them under common
United Nations' control until more permanent forms
of organizations have been developed. When you have
established responsible governments as indicated
before, you will be given opportunity to participate
as one of the United Nations in the direction of these
and other United Nations' organizations.
X. After you have reestablished the functioning of your
industry and agriculture, you will be expected to
eid in the rebuilding of portions of the countries
which your present rulers have devastated.
XI. We hereby enter a solemn undertaking, however, that
the burdens of reparation which may be laid upon you
and the financial arrangements necessary in the handling
of those reparations will not be made so heavy that it
will not be possible at the same time for you to create
a limited course of years, can leave you free to estab-
a prosperous life for yourselves, end one which, within
lish higher levels of prosperity, and better standards
of living for yourselves than you had known before the
war.
XII. We recognize that if the world is to be peaceful in
the future, it must also be prosperous, and we undertake
to see that the necessary steps are taken after the war
so that you, as well as we, will have the opportunity
to earn prosperity.
XIII, To this end we will see -
1. That no nation is barred from due access to the
raw materials of the world.
2. That no nation is barred from access to the
markets of the world.
Regraded Unclassified
221
- 3 -
3. That under-developed nations, or those which
have hitherto been exploited for the benefits
of others, will be afforded the opportunity to
industrialize their own economy and develop their
resources for their own benefit as well as those
of other countries, and will be assisted in
establishing a decent social order.
4. The United Nations are now in the process of
developing organs of international collaboration
and assistance in the fields of relief, agriculture,
labor, monetary stabilization, and long-time finance.
In due course, when your nation has qualified as
a respected member of the family of nations, you
will be able to join these organizations as one
of the participating United Nations.
XIV. As we have already agreed at Moscow, an International
Security Organization will be established. Among
other points, this security organization will see
that the arms industries are not reestablished in
any of your countries during such period as there
is any danger that they might again threaten the
peace or stability of the world. In due course,
however, your nation will be permitted to participate
as one of the United Nations in developing the broad
policies for international security.
XV. As this International Security Organization demonstrates
its ability to maintain peace and security in the
world, it is our intention gradually to reduce our
armed forces. That reduction of force this time
will come after instead of before the world has
become protected from future aggressors.
XVI. It is recognized that the peoples of all nations
have a common interest which can not be disregarded
without adversely affecting the most favored. Our
ultimate goal is to establish a world order consisting
of B family of nations, each having due regard for
the welfare and rights of the others.
Regraded Unclassified
222
Treasury Department
Division of Monetary Research
D
Date
19
To: Mr. White
The Secretary wanted you to get this as
soon as possible. Note that it is for
you "for your guidance". This is to be
returned to Mrs. McHugh for their files.
27.04
MR. WHITE
Branch 2058 - Room 214-1/2
Regraded Unclassified
X s white 223
TREASURY DEPARTMENT
3
INTER OFFICE COMMUNICATION
DATE
TO
Secretary Morgenthau
April 18, 1944
FROM Joseph J. O'Connell, Jr.
For your information
In Secretary Hull's recent radio address on planning
for peace appears a general statement of the State Depart-
ment's position towards Congressional participation in
the formulation of plans in the field of international
affairs.
In sum it indicates an intention to solicit "advice
and help" from a "representative, bipartisan group" to be
designated by the Chairman of the Senate Committee on
Foreign Relations, and also to consult with members of the
House.
As you may have noticed, this morning's papers carry
announcement to the effect that Secretary Hull plans to
begin discussions this week with a bipartisan Senate
Committee, composed of three Republicans and three Democrats.
It is almost inevitable that you will be asked on
Friday (and will have to decide in any event in the very
near future) what Congressional representation, if any,
you contemplate having for the coming monetary conference.
For purposes of the meetings with the Committees this week,
it would seem to me desirable to say that when plans for
the conference are finally announced it is expected that
Congressional representation will be invited if it can be
worked out within the framework of the conference as arranged.
I think it would be difficult to say less, unless you
intend keeping the conference entirely within the Executive
branch, and I do not see how you could say more at this
point unless you are prepared to indicate precisely what
Congressional representation you want, which obviously
you are in no position to do.
Regraded Unclassified
224
Secretary Morgenthau,
If it is decided to invite Congressional parti-
cipation, a possible solution to the problem of
selection, complicated in this case by actual or
asserted jurisdiction by 30 many Committees in both
Houses, occurs to me. Why not consider appointing
as delegates the majority and minority leaders of both
House and Senate (i. e., une of the minority trium-
virate of the Senate).
I am attaching a somewhat longer memorandum, which
may serve to recall to your mind the somewhat unhappy
experience of the International Food Conference, as
well as a few facts with respect to other conferences
held in the past. It also points out, as is obvious,
that as a purely legal matter Congressional participation
in such a conference is a matter of Executive grace and
not Congressional right.
ggoin
Enclosure
Regraded Unclassified
225
International conferences involve Executive functions
exclusively and any participation by Members of Congress
either as individuals or representative committees of
Congress is a matter of grace and not of right. This
proposition is too clear to require extended discussion.
It is likewise entirely clear that resolutions such as
the Andresen resolution, which you will recall provided
for establishing a select committee of the House directed
to attend any international monetary conference held at
the invitation of the United States, would direct the
designated members of the committee to take action which
the Executive branch might resist as an improper encroach-
ment upon its functions.
However, congressional participation at the invitation
of the President in international conferences is not with-
out precedent. At the Bermuda Refugee Conference, held
about a year ago, the President named Senator Lucas and
Representative Bloom, together with Dr. Dodd of Princeton,
as the representatives of the United States to the con-
ference which was held, I believe, under British auspices.
On the floor of the House Representatives Dickstein and
Mason, the chairman and ranking minority members, re-
spectively, of the Immigration and Naturalization Commit-
tee, complained that their committee was not invited to
have representatives at the conference. Representative
Fish also criticized the failure to include minority
representation in the American delegation. In this con-
nection, it is a matter of historical interest that the
President appointed, as members of the delegation of the
United States to the London Economic Conference in 1933
Senator Pittman and Representative McReynolds, Democrats,
and Senator Couzens and Representative Morrison, Republi-
cans. In connection with that conference the only congres-
sional action taken, other than an appropriation providing
the necessary funds, was the adoption by the Senate of a
resolution expressing the sense of the Senate that the
United States delegates should work unceasingly for inter-
national agreement to remonetize silver on a fixed and
definite ratio 16 to 1.
Regraded Unclassified
226
- 2 -
The International Food Conference which was held at
Hot Springs, Virginia, in May of last year, affords, I
believe, ample examples of pitfalls to be avoided in
arranging such conferences. Preparations for the confer-
ence seemingly were made without consultation with the
key Members of Congress and no provision for their partici-
pation was made. About a month before the conference con-
vened a number of resolutions, similar to the Andresen
resolution, were introduced although not adopted. Repre-
sentatives Bradley of Michigan and Smith of Ohio (both
Republicans) walked into the conference without invitation
and were admitted. They met Marvin Jones, the conference
chairman, who invited them to sit in on all of the ses-
sions of the conference, including the executive sessions,
but that invitation was subsequently modified on the
advice of the State Department representative, Mr. McDermott,
to exclude the executive sessions. As & consequence,
Representatives Bradley and Smith returned to make blister-
ing statements both on the floor of the House and to the
press. They also introduced a resolution to require con-
gressional approval of any commitments made at the con-
ference, but no action on that resolution has been taken.
The relations with the press were also rather awkwardly
handled, severe restrictions being first imposed but sub-
sequently relaxed.
Although Executive agreements, as distinguished from
treaties, do not require Senate ratification or other form
of approval by the Congress, it is frequently necessary
that such agreements be implemented by legislation. Legis-
lation recently approved authorizing an appropriation for
the United Nations Relief and Rehabilitation Administration
is a case in point.
With respect to the State Department's present atti-
tude toward congressional participation in the formulation
of plans in the field of international affairs, the fol-
lowing statement in Secretary Hull's recent radio address
on planning for peace may be of interest:
Regraded Unclassified
227
- 3 -
"We are at a stage where much of the work
of formulating plans for the organization to
maintain peace has been accomplished. It is
right and necessary that we should have the ad-
vice and help of an increasing number of members
of the Congress. Accordingly, I have requested
the chairman of the Senate Committee on Foreign
Relations to designate a representative, biparti-
san group for this purpose.
"Following these and similar discussions
with members of the House of Representatives, we
shall be in a position to go forward again with
other nations and, upon learning their views, be
able to submit to the democratic processes of
discussion a more concrete proposal."
Regraded Unclassified
228
POBVICTORY
treasury DEPARTMENT
BUY
VRITED
STATES
WAR
BONDS
PROCUREMENT DIVISION
...
STAMPS
WASHINGTON 25
SECRET DE
April 18, 1944
REMORANDUM THE SECRETARY:
There is submitted herewith the weekly report
of Lend-Lease purchases.
An additional requisition has been received for
the purchase of 17,920,000 pounds of Magnesium Alloy
Ingot for the production of Incendiary Bombs in the
United Kingdom.
We have been advised informally by the Foreign
Economic Administration that they are contemplating the
allocation of cut, make and trim contracts in Puerto
Rico, and at their request we are inquiring into the
matter.
Director of Procurement
Attachment
your Clifton Mack
Rearadod
229
LEND-LEASE
SECRET
TREASURY DEPARTMENT, PROCUREMENT DIVISION
STATEMENT OF ALLOCATIONS, OBLIGATIONS (PURCHASES) AND
DELIVERIES TO FOREIGN GOVERNMENTS AT U. S. PORTS
AS OF APRIL 12, 1944
(In Millions of Dollars)
SECRET Miscellaneous &
Administrative
Total
U. K.
Russia
China
Expenses
Undistributed
Allocations
4724.0
$2292.9
$1877.3
$133.9
$12.6
$407.3
(4719.0)
(2290.9)
(1877.3)
(133.9)
(12.6)
(404.3)
Purchase Authoriza-
$3703.4
$1890.2
$1463.4
$66.4
-
$283.4
tions (Requisitions)
(3691.2)
(1883.1)
(1460.0)
(66.6)
-
(281.5)
Requisitions Cleared
3617.7
$1865.8
$1433.6
$44.7
-
$273.6
for Purchase
(3598.3)
(1858.5)
(1425.8)
(44.9)
-
(269.1)
Obligations-
$3480.3
$1831.6
$1398.1
$44.4
$11.1
195.1
(Purchases)
(3459.7)
(1822.3)
(1389.7)
(44.4)
(11.0)
(192.3)
Deliveries to Foreign
$1931.6
$1235.2
$ 639.2
$22.0
-
$35.2
Governments at U. S.
(1906.1)
(1219.5)
(630.9)
(22.0)
-
(33.7)
Ports*
#Deliveries to foreign governments at U. S. Ports do not include the tonnage that
is either in storage, "in-transit" 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 April 5, 1944.
Regraded Unclassifie
230
EXPLANATION OF DIFFERENCE AND
ADJUSTMENT OF REPORT OF APRIL 5, 1944
The decreases in Purchase Authorizations and
Requisitions Cleared for China are a result of adjust-
ments of requisitions to actual contracts.
Miscellaneous and Undistributed costs under "Purchase
Authorizations" were 6.7 million in error on the report
of April 5, 1944. The necessary adjustment has been made
in the present report.
Regraded Unclassified
231
mm Klotz
The Saity may 6a
interested in attached
chipping.
&
4/18/44
See also attached cable
from Armous
MR. LUXFORD
232.
The Journal of Commerce
APR 18 1944
Argentina May Seize
British Owned Utility
BUENOIS AIRES, April 17 (AP).
-The Argentine Government today
ordered the exproporiation of the
British-owned Compania Primitiva
de Gas, which has been supplying
this capital city with coal and gas
since 1854.
The decree said the company
would be offered 3,758,740 pesos
($1,126,676 at the official exchange
rate) for its property, and that If It
refused, an order for its seizure
would be obtained from a Federal
judge. Company officials declined
comment but indicated the Govern-
ment's price was far below what
they consider acceptable.
Publication of the decree was the
first notice given them, the com-
pany officials said, although they
had known that the Government
subsidiary, Yacimientos Petrolifer-
os Fiscales (State oilfields) was
planning to supply the city with
gas beginning January 15, 1945.
The British company is capital-
ized at 3,000,000 pounds, with 1,000,-
000 pounds additional debentares.
Officials said the company had had
profesable years recently dispite
the Doal shortage due to wartime
shipping problems.
The decree said the Y. P. F.
would utilize the same machinery
and employes of the British com-
pany.
Regraded Unclassified
233
THE WALL STREET JOURNAL
APR 18 1944
Argentina to Expropriate
British-Owned Firm
BUENOS AIRES (P-The Argentine Gov-
ernment yesterday ordered the expropriation
of the British-owned Compania Primitiva de
Gas, which has been supplying this city with
coal and gas since 1854. The decree said the
company would be offered 3,758,740 pesos
($1,126,676.90 at the official exchange rate)
for its property. and that, if the company re-
fused the offer. an order for its seizure would
be obtained from & Federal judge. Company
officials indicated the Government's price WAS
far below what they consider acceptable.
The British company is capitalized at E:
million. with £1 million additional debentures
Officials said that. despite a coal shortage, the
company had profitable years recently.
To
Regraded Unclassified
PLAIN
234
GHR . 245
Duesos Aires
Dated April 12, 1944
Ree'd 9134 Dame
Secretary of State,
Washington.
PRICRITY
966, twelfth.
Associated Pross despatch published by overing papers today refers
to alleged sente shortage of corn is United States sad suggests that this
may influence early recognition of Argentine regime. Mention is made of
lov level of corn recerves and saxiety of manufacturers using corn for
production of cocontial var materials, and 10 is stated that "In recent
days the corn situation in the United States has been the subject of various
conferences is which have participated directors of the was Food Administration,
the Var Production Beard, the Var Shipping Mainistration, the Office of Price
Controls smith Office of Mesmonic stabilization". It 10 assorted that
Argentina has expressed villingness to deliver considerable quantities of
corn provided is return 10 receives needed feels. This situation, article
adds, has inteduced new faster in diplematic attitude of United States on
question of recognition. After referring to runere that have circulated on
various occasions that white House and State Department have been studying
Treasury plans for application of economic senstions against Argentina, despatch
concludes that "any decision intended to obtain grains from Argentime would
obviously and the possibility of ostablishment of economic sanstions and would
perhaps signify recognition of the of General Farrell".
ARMOUR
NJH
efteepy
Distributed to: Mr. Bell(Mr.Districh);Mr. Paul: Mr.White (Mr. Ness-Orig.);
Mr. Luxford: Mr. Bernstein: Mr. Taylor: Mr. Ness.
From Mrs. 1. Fentaine - Room 225
Regraded Unclassified
235
TREASURY DEPARTMENT
INTER OFFICE COMMUNICATION
DATE APR 18 1944
TO
Secretary Morgenthau
FROM
Mr. Pehle
I am sure you will be interested in
the attached cable from Cairo.
Attachment.
236
in
>il
PARAPHRASE OF TELEGRAM RECEIVED
FROM:
The American Minister, Cairo
TO:
The Secretary of State, Washington
DATE:
April 13, 1944
NUMBER:
88
SECRET
With a view to obtaining Tito's active aid in facilitating
the escape of Jews from Hungary through Partisan territory to
Italy and the Mediterranean region, the Foreign Office at London,
at the request of various Jewish bodies, has instructed its
Yugoslavian Embassy to approach him (Tito) through McLean. It
is added by the Foreign Office that the maintenance and care of
such refugees when they arrive in the Middle East and Italy will
be presumably the responsibility of MERRA and the Allied Dis-
placed Persons Commission and that arrangements to receive them
should be made with these organizations. The Foreign Office
concludes that the British Embassy should keep in touch with
this Embassy in view of the cooperation between HMS Government
and the United States Government concerning refugee questions.
Yesterday a member of the British Embassy, pursuant to this
instruction, called at this office and made inquiries regarding
the United States' attitude with reference to this project after
informing us that an appropriate message is being sent to McLean.
In reply he was advised that the President in an Executive Order
Regraded Unclassified
237
- 2 -
dated January 22 which was quoted in a circular airgram from the
Department dated 7 p.m., January 26, and which was shown to him,
set forth the United States' policy with regard to the mainte-
nance of refugees from Europe although the Embassy is without
specific instructions concerning this particular endeavor.
My informant in response to an inquiry said that since the
Allied mission to Mihailovitch is being withdrawn, no (repeat no)
similar effort to arrange passage through Mihailovitch territory
for refugees is possible.
MACVEAGH
DCR:MPL
4/14/44
238
EMBASSY OF THE
UNITED STATES OF AMERICA
(By Courier)
STRICTLY CONFIDENTIAL
No. 1388
Quito, April 18, 1944
Subject: Unauthorized Passports Issued to Persons Persecuted
by Enemy Authorities.
The Honorable
The Secretary of State,
Washington.
Sir:
With reference to the Department's secret circular
airgram of March 31, 1:05 p.m., regarding passports issued
in the names of various Latin American countries to persons
in enemy-occupied Europe, I have the honor to report that
the substance of the Department's airgram was conveyed
orally to the Minister for Foreign Affairs yesterday. The
Minister then read to me a copy of a note sent to the
British Minister here on March 30 which was in reply to &
note from the British Minister concerning the unauthorized
issuance of Ecuadoran passports in Stockholm and which he
said explained the attitude of the Ecuadoran Government in
the matter. I enclose a copy of this note, which was later
furnished me by the British Minister, as well as a transla-
tion of the communication.
It will be noted that the Foreign Office communication
indicates that while the Ecuadoran Government is not dis-
posed to confirm the validity of unauthorized passports in
Regraded Unclassified
239
- 2 -
the possession of individuals persecuted by the enemy, it
will, nevertheless, not cancel the passports prior to such
time as the holders reach a place of safety, and that both
the Inter-Governmental Committee in London and Ecuadoran
consular officers abroad have been informed in this sense.
Respectfully yours,
13/ James W. Gantebein
James W. Gantebein
American Charge d'Affaires, a.i.
Enclosure:
1. Copy of note
2. Translation of note
Original to the Department of State
Copy to the Consulate General, Guayaquil
JWG:rab
File No. 811.11
240
AIR MAIL
Enclosure No. 2 to despatch No. 1388 of April 18, 1944,
from the American Embassy, Quito, Ecuador.
(Translation)
COPY
Republic of Ecuador
Ministry of Foreign Affairs
DIPLOMATIC DEPARTMENT
No. 28-DC-13
Quito, March 30, 1944
Mr. Minister:
In reply to Your Excellency's communication
No. 17 dated the 22d current, in which you are good enough
to inform me of the desire of the Government of His Britannic
Majesty to know whether Ecuador will permit the retention of
passports which have been granted by the ex-Consul of my
country in Stockholm to Israelites who are living in states
occupied by the German forces, I have the honor to state to
Your Excellency that my Government, notwithstanding the fact
that it denies all validity with respect to the afore-
mentioned passports, considering the grave penalties and
difficulties to which those individuals would be subjected
in case they were deprived of those documents, has decided
not to insist on their cancellation while the existing cir-
cumstances prevail.
This decision of the Ecuadoran Government was
transmitted to the Inter-Governmental Committee of Political
Refugees, and Ecuadoran consular agents (officers) have been
instructed in the same sense.
I must make clear that the aforementioned deci-
sion of my Government does not confer any right on those
persons who possess passports with respect to entry into
Ecuador without the fulfillment of the formalities established
by the Alien Law (now) in force and does not constitute pre-
cedents for claiming a presumed acquisition of nationality.
Ecuador will deny all validity concerning those
documents as soon as their bearers have left areas controlled
by the Nazi armies.
Regraded Unclassified
241
- 2 -
I avail myself of the opportunity to renew to
Your Excellency the assurances of my highest and most dis-
tinguished consideration.
(Signed) Francisco Guarderas
To His Excellency
Mr. LESLIE CHARLES HUGHES-HALLET,
Envoy Extraordinary and Minister Plenipotentiary
of Great Britain,
CITY.
TR/JWG:rab
Regraded Unclassified
242
TELEGRAM SENT
WMG
PLAIN
April 18, 1944
AMEMBASSY,
LONDON.
3109, Eighteenth
FOR WINANT FROM WAR REFUGEE BOARD
Refer to Department's telegram 634 of January 25 regarding
War Refugee Board.
The Board feels that it would be desirable to appoint a Special
Representative in London to operate there on its behalf. The Special
Representative so appointed will be designated by the Department as
Special Attache to the Embassy.
In general the Special Representative would be charged with
the responsibility and duty of carrying out the policies and pro-
gram of the Board in Great Britain. He will be responsible to you
and will be instructed to discuss his activities and problems regu-
larly and fully with you. Among other things, he will be expected
to develop and assist in the development of programs and implementa-
tion of measures for the rescue, maintenance, relief and transporta-
tion of refugees and to forward recommendations and frequent reports
on progress of work and difficulties encountered.
At the present time no selection has been mede for the posi-
tion of Special Representative. However, the Board would like to
send to London Dorothy K. Brown (Mrs. La Rue Brown) as an assistant
to the Special Representative who will be designated later. It is
understood that Mrs. Brown is known to you. Please advise the
Department promptly as to your views with respect to this matter.
HULL
(GIW)
WRB:GLW:KG
4/18/44
Regraded Unclassified
243
KEN-785
PLAIN
London
Dated April 18, 1944
Rec'd 10 a.m.
Secretary of State,
Washington.
US URGENT
3153, Eighteenth.
It would be of great assistance to the Embassy
if we could receiv TO today for a postponed subcommittee
meeting a telegram indicating Department's attitude
regarding Intergovernmental Committee on Refugees draft
rules submitted in despatches 14742, March 29 and
14853, April 4, instructions concerning which were
requested by April 16.
WINANT
RR
Regraded Unclassified
244
MO - 276
PLAIN
London
Dated April 18, 1944
Rec'd 6:38 p.m.
Secretary of State
Washington
3207, Nineteenth.
FOR WAR REFUGEE BOARD FROM THE AMBASSADOR
Thank you for your message no. 3109 of April 19.
I will be very glad to have a special representative of
the War Refugee Board attached to the Embassy. I will
also be glad to have Dorothy K. Brown appointed as an
assistant to the special mepresentative.
WINANT
RB
Regraded Unclassified
245
PROPOSED CABLE TO HELSINKI
AMERICAN LEGATION HELSINKI
War Refugee Board commends you for your 303 April 3
Legation Stockholm requested accelerate matter Swedish
visas refugees and Jewish community Finland. Private
sources express grave anxiety over possible German-
inspired persecution Jews Finland. Do you b elieve Finnish
cooperation obtainable establish escape-route from German-
held Baltic areas to Sweden via Finland? Board would
welcome your suggestions comments opinions these matters.
APRIL 18, 1944
4:00 p.m.
MStandish:lom
4-17-44
Regraded Unclassified
246
AIRONAM
FROM AMERICAN CONSULATE GENERAL
Jerusalem
Dated April 18, 1944
Ceurier departure: April 22, 1944; 6 a.m.
Rec'd April 29, 3pm
Secretary of States
Washington
4-19 April 18, 19441 3 p.m.
Yesterday, in a conversation with the Chief
Secretary of the Government of Palestice, I referred
to the talk which I had had with Dr. Bernard Jeseph
on ^pril 7th concerning the question of Jewish immigra-
tien into Palestine in the imediate future. The Chief
Secretary informed no that Dr. Jeseph's statements with
regard to the Government's policy vere without founds-
tien and that the admission of Jewish refugees from
German-ecoupied Barepe would continue without interrup-
tion until the maximum number (75,000) permitted by the
1939 White Paper had actually arrived is the country.
Be added that such questions as w the admission of
additional persons and (b) the homoring of earmarked
pertificates after their use for the admission of
persons other than the original beneficiaries, vere
miters of major pelicy which could only be settled by
the British Government in Landen.
PINKERTON
HVC/dm
247
CABLE TO AMERICAN CONSUL general AT JERUSALEM
The War Refugee Board requests that you deliver the
following message to Chief Rabbi Iseac Herzog:
QUOTE. Your radiograms of April 4 and 7 have been
received.
The safety of Jewish and other holders of Letin American
passports in Vittel and other camps has been a matter of deep.
concern to this Government. It has made repeated efforts to
save all these persons. To this end, it has approached the
governments of Spain, Switzerland and Latin American countries
involved and is maintaining constant communication with Inter-
governmental Committee and International Red Cross.
Special steps have been taken to save the lives of 238
persons deported from Vittel.
The Board hopes that, as a result of these efforts, the
danger threatening these persons will be averted. Signed,
John W. Pehle, Executive Director, War Refugee Board, UNQUOTE.
April 18, 1944
4:00 p.m.
ISLesser:als 4/17/44
Regraded Unclassified
248
CABLE TO MISSIONS AT COSTA RICA, ECUMDOR, EL SALVADOR, HAITI, PERU
NICARAGUA AND VENEZUELA
Referring to the Department's circular airgwams of April 10,
11:00 Belley and of March 31, 1:05p.m., the following is the substance
of a message received from London by Sir Herbert Emerson, Director of
the Intergovernmental Committee, who is now in Washington: QUOTE
According cables Jewish Agency, Jerusalem, new commander Vittel Camp
advised March 20 about 250 to 300 internees holding South American
passports that they were not recognised by government concerned. It
is alleged thede persons already isolated for deportation which caused
panic and despair. Agency here has partial list of people affected,
mostly Polish Jews previously put on list of veteran Zionists, Rabbis,
et cetera, for grant of Palestine certificates. Agency trying to
obtain from Colonial Office treal assurance to Ewiss protecting power
that these persons placed on Palestine exchange list in order to stave
off deportation. UNQUOTE.
In view of the imminent danger which faces the persons involved,
and in the light of this Government's deep concern for their welfare,
you should communicate to appropriate officials of the Government to
which you are accredited the urgency with which favorable responses and
active measures along the lines described it our circular sirgrams of
April 10 and March 31 are needed. You may also wish to inform such officials
that in addition to the approach to Switzerland referred to in our circular
airgram of April 10, we have also requested Ambassador Hayes similarly
to approach the Spanish Government. Please keep the Department promptly
advised of all developments in this matter.
April 18, 1944
12:55 p.m.
00
LSLesser:als 4/17/44
Regraded Unclassified
249
CABLE TO THE AMERICAN EMBASSY, ASUNCION, PARAGUAY
Referring to the Department's 118 of April 10, the following
is the substance of a message received from London by Sir Herbert
Emerson, Director of the Intergovernmental Committee, who is now in
Washington: QUOTE According cables Jewish Agency, Jerusalem, new
commander Vittel Camp advised March 20 about 250 to 300 internees
holding South American passports that they were not recognized by
government concerned. It is alleged these persons already isolated
for deportation which caused panic and despair. Agency here has
partial list of people affected, mostly Polish Jews previously put
on list of veteran Zionists, Rabbis, et cetera, for grant of Pelestine
certificates. Agency trying to obtain from Colonial Office formal
assurance to Swiss protecting power that these persons placed on
Palestine exchange list in order to stave off deportation. UNQUOTE.
In view of the imminent danger which faces the persons involved,
and in the light of this Government's deep concern for their welfare,
you should communicate to appropriate officials of the Government to
which you are accredited the urgency with which favorable responses and
active measures along the lines described in our 118 of April 10
are needed. You may also wish to inform such officials that in addition
to the approach to Switzerland referred to in our 118 of April 10, we
have also requested Ambessador Hayes similarly to approach the Spanish
Government. Please keep the Department promptly advised of all
developments in this matter.
April 18, 1944
12:55 p.m.
LSLesser:als 4/17/44
Regraded Unclassified
250
GABLE TO LISBON
Please deliver following message to Minister Norweb, Lisbon, for
Dexter, War Refugee Board Representative, from J. W. Pehle.
Reference your 1053, April 10. Glad to hear of designation and
acceptance. Arrangements being made here for Legation to supply
administrative needs and administrative expenditures through
State Department channels. Attempting to make arrangemente-mdfor
automobile and typewriters and will advise you further. Agreeable
to purchase of safe if Legation unable to accommodate. Establish
ing $10,000 credit for which you will be responsible to me alone.
These funds not subject to usual government disbursing requirements
but you should keep careful record and obtain receipts where possible.
These funds may be used at your discretion but should not (repeat not)
be used for administrative expenses of the sort being handled by the
Legation. We are contacting Eleanor Widen re availability. Compen-
sation for less of time to Unitarian Committee being arranged with
Joy.
THIS IS WEB LISBON CABLE NO. 3
April 18, 1944
3:15 p.m.
WStewart;pdk 4/18/44
Regraded Unclassified
251
KEM-809
PLAIN
Lisbon
Dated April 18, 1944
Rec'd 11:48 &
Secretary of State,
Washington.
1145, Eighteenth, 11 A.M.
Joseph Schwartz requests that following message
be sent through War Refugee Board to Leavitt Joint
Distribution Committee New York,
"For your information Ferramonti camp southern
Italy contains 1100 Jewish refugees including 200
women 100 children. Of these 737 have registered for
immigration Palestine, 87 USA, 61 England, 66 other
countries. They receive food plus fifteen cents adults
ten cents children cash daily which camp committee
considers insufficient. Food and clothing situation
generally very badt Camp committee consists Herbert
Landau, Doctor Max Pereles, Sigmund Guttman who ask
that remittances be sent their account Banco de Napoli
Cosensa. Wish advise Jewish Agency has sent Ferramonti
1500 pounds clothing 500 pounds supplies also about
7000 pounds cash for distribution to all refugees southern
Italy numbering approximately 6000. Have asked you
several times previously advise us whether remittances
to southern Italy pessible. If remittances possible
believe for reppesentative Intergovernmental Committee
Italy handle distribution our funds until our own
representative able function. Advise urgently".
NORWEB
WSB
Regraded Unclassified
252
PARAPHRASE OF TELEGRAM RECEIVED
FROM:
The American Minister, Lisbon
TO:
The Secretary of State, Washington
DATE:
April 18, 1944
NUMBER: 1150
CONFIDENTIAL
For transmission onward to the Governments of Rumania
and Hungary the substance of the message from the Wer
Refugee Board which was continued in your number 1013 dated
April 12 has been placed in the proper channels.
NORWED
DCR:MPL
4/19/44
Regraded Unclassified
253
PARAPHRASE OF TELEGRAM RECEIVED
FROM:
The American Minister, Lisbon
TO:
The Secretary of State, Washington
DATE:
April 18, 1944
NUMBER: 1155
CONFIDENTIAL
There follows in substance a paraphrased message for
Leavitt, Joint Distribution Committee, New York, and the War
Refugee Board from Mr. Joseph Schwartz:
The International Red Cross out of the funds supplied by
us has sent to Poland 100,000 Swise francs worth of food and
medicine. During the last four or five weeks over three hundred
children from France have arrived in Switzerland and they are
being cared for by local gropps. During the past two to three
weeks sixty-four refugees including two children have come to
Spain from France. Most of these recent arrivals who are in
Lerida are being maintained by our Barcelona office. Any day
we are expecting the arrival of a group of children. I shalll
keep you informed.
NORWEB
DCRIMPL
4/19/44
Regraded Unclassified
254
PARAPHRASE OF TELEGRAM RECEIVED
FROM:
The American Minister, Lisbon
TO:
The Secretary of State, Washington
an
DATE:
April 18, 1944
NUMBER: 1155
CONFIDENTIAL
There follows in substance a paraphrased message for
Leavitt, Joint Distribution Committee, New York, and the War
Refugee Board from Mr. Joseph Schwartz:
The International Red Cross out of the funds supplied by
us has sent to Poland 100,000 Swiss francs worth of food and
medicine. During the last four or five weeks over three hundred
children from France have arrived in Switzerland and they are
being cared for by local groups. During the past two to three
weeks sixty-four refugees including two children have come to
Spain from France. Most of these recent arrivals who are in
Lerida are being maintained by our Barcelona office. Any day
we are expecting the arrival of a group of children. I shall
keep you informed.
NORWEB
DCR:MPL
4/19/44
Regraded Unclassified
255
PARAPHRASE OF TELEGRAM RECEIVED
FROM:
The American Legation, Stockholm
TO:
The Secretary of State, Washington
RATE:
April 18, 1944
NUMBER: 1342
SECRET
An appeal to the Government of Germany to permit refugee
chibdren to proceed to Sweden has repeatedly been made by the
Government of Sweden during the past year according to Soderblom
(War Refuges Board's number 2, number 654 dated April 12 from
the Department). It appeared for a while that arrangements
would be successful for the evacuation of large numbers of
Belgian and French refugee children but the Government of Ger-
many at the last moment on the ground that transport facilities
for the evacuation of the children could not be spared, stopped
the proceedings. It was added by Soderblem that the Government
of Sweden is constantly following the matter and as soon as
there seems to be a sporting chance that the Germans might 8 n-
sent the question will again be pressed. Since military re-
quirements are now so overburdening transportation facilities
that it is actually almost an impossibility for a civilian to
get permission to travel, it is Soderblom's opinion that there
is no chance whatever that the Germans would consent to make
them (transportation facilities) available. It was Soderblom's
desare that the fact be emphasized that the Government of Sweden
is not overlooking any opportunity, that it hhs appealed and
will continue to appeal to the Government of Germany to allow
travel to Sweden of refuges children.
JOHNSON
DCR:MPL
4/20/44
Regraded Unclassified
256
PARAPHRASE OF TELEGRAM RECEIVED
FROM:
American Legation, Stockholm
TO:
Secretary of State, Washington
DATED:
April 18, 1944
NUMBER: 1345
SECRET
Reference Department's 502, dated March 24.
The March 24 statement of the President regarding
refugees and Nasi persecutions lost part of its potential
publicity because it was released to Sweden via Reuter
on March 25, which was a holiday and important morning
papers were not published. Two afternoon papere, however,
AFTONBLADET and ALLEHANDA, carried the statement complete.
The statement was carried proginently by DAGENS NYHETER
and to a lesser extent by STOCKHOLMS-TIDINGEN, THE FOLLOWING
DAY. Outside of Stockholm there was little coverage in
Sweden.
Since interest of the press in this connection
appeared to be centered on Palestine-Hungarian=@ewish
question, Swedish editorials only referred to statement
indirectly. At a time when the President was urging all
free peoples temporarily to open their frontiers to victims
of Nasi oppression there was a general unfortunate re-
action to the closing of Palestine.
Over short, medium and long wave lengths, excerpts
of the President's statement were given in official Swedish
news broadcasts in the Swedish language.
The statement has been relayed through underground
channels to Nerway and Denmark by the Legation's press
section and it is believed the statement will come to the
attention of occupation forces of Germany. The DNYTOVER
ATLANTEN, A Danish-Swedish newspaper for refugees in
Sweden, also published the statement. In order to get
copies of this paper into Denmark they must be smuggled.
Informal requests by the Legation that prominent
Government official publicly comment on statement were
not productive (see the Legation's cable of Aprill,
no. 1236).
The appointment of Iver Olsen as representative
of the Var Refuges Board, press release via Reuter,
resulted it interviews which were carried prominently
by almost all Avedish papers. The statement Olsen made to
the press referred to the President's statement and also
activities of the Board.
257
- 2 -
By airmail we are forwarding a despatch which trans-
mite significant clippings.
MOHNSON
258
CABLE FROM WAR REFUGEE BOARD TO HARRISON AT BERN FOR McCLELLAND
The American Friends Service Committee reports having informa-
tion to the effect that Andre Blumel, formerly secretary to former
Premier Blum of France is interned by the Germans and is so seriously
ill as to be in danger of death unless be is promptly removed to a
place where more adequate medical care is available to him. While
we are unaware of any previous instance where a civilian internee has
been released by the interning power for hospitalization in a neutral
country, you are requested to approach appropriate officials of the
Swiss government and inquire whether they would be willing to approach
Germany in an effort to procure Blumel's release for hospitalization
in Switserland.
It is suggested that a technique similar to that developed by
the Swies in 1916 for prisoners of war, and later embodied in the
Geneva Conference of 1929 and the Model Agreement annexed thereto,
might be employed, with such suitable guarantees and assurances to
the Germans as the circumstances may warrant.
Funds for Blumel's transportation, medical and hospital expenses
are available.
Please keep the War Refugee Board advised of any developments
in this matter.
THIS IS WRB BERN CABLE NO. 1
In order to avoid confusion in connection with its cables to
representatives in the field, the Board, commencing with this cable,
intends to number its cables to each representative consecutively, In
replying to Board cables kindly refer to the WRB designation. You
should also consecutively number all cables to the Board.
April 18, 1944
11:25 a.m.
RLSmith
ISLesser:als 4/13/44
Regraded Unclassified
259
CABLE TO MINISTER HARRISON, BERN
Reference your No. 2310 April 13, 1944. The Turkish Government has
already acted in support of the ICRC request for safe conduct for the
SE TARI. The Swedish Government has been asked to support such request
and has agreed to do 80. Accordingly you may care to bring these facts to
the attention of Swiss Government in an effort to persuade it to
reconsider its decision. Please keep the Department and War Refugee
Board advised on this matter.
THIS IS WRB BERN-CABLE NO. 2
April 18, 1944
12:55 p.m.
Regraded Unclassified
260
PARAPHRASE OF TELEGRAM RECEIVED
FROM:
The American Minister, Bern
TO:
The Secretary of State, Washington
DATE:
April 18, 1944
NUMBER:
2444 (Section I)
SECRET
The following message is from Gerhardt Riegner and Richard
Lichtheim, Geneva, to the World Jewish Congress, 1834 Broadway,
New York, for Dr. Wise.
(For delivery to Dr. Wise at the discretion of the Department,
the following message in substance is transmitted by the Legation
for the information of the Department).
Our opinion is that a special effort to arrange an exchange
of Jews in German-occupied countries against German nationals in
Allied countries should be made by the War Refugee Board working
with the Government of Britain. In the first instance the Jewish
candidates for exchange are those who received Palestine immigra-
tion certificates whose names have beenmtified by the Government
of Britain through Switzerland as the protecting power, to the
Government of Germany. There are approximately 3500 of these per-
sons. Germany has accepted this principle of exchange for persons
holding these certificates but due to the lack of German candi-
dates the exchange has not materialized so far. The holders of
these certificates have been kept to date in special camps and
are in danger of departation since Germany is now getting impatient.
The whole group might be saved if as a beginning an exchange of a
few hundred at least could be made with prospects of further
exchanges in the future.
HARRISON
DCR:MPL
4/20/44
Regraded Unclassified
261
PARAPHRASE OF TELEGRAM RECEIVED
FROM:
The American Minister, Bern
TO:
The Secretary of State, Washington
DATE:
April 18, 1944
NUMBER:
2444 (Section 2)
SECRET
As quickly as possible the War Refugee Board should therefore
prepare a full list of all Germans in North and South America and
in the British Empire who are eligible for exchange and should
also with the British Government send such list through protecting
powers to the Government of Germany without delay.
In view of the present situation this procedure is of the
utmost urgency. In case some practical result is obtained an
effort should also be made to arrange a separate exchange plan for
such Jews as many have obtained South American passports or other
papers of identity from certain consulates provided recognition of
such documents for this prupose can be obtained from respective
governments. Bearers of visas for overseas countries would be
other Jewish candidates for exchange. This scheme is of particular
importance to Jews in Hungary in view of their desperate situation;
these Hungarian Jews also could profit from Palestine certificates
or other authorised visas or documents. It is our considered
opinion that unless action is taken at once to effect a group ex-
change, neither holders of Palestine certificates nor any other
groups can be saved. This view is held by all diplomatic repre-
sentatives including the Papal Nuncio at Bern who have approached
us recently.
HARRISON
DCR:MPL
4/20/44
Regraded Unclassified
262
TELEGRAM SENT
This telegram must be
April 18, 1944
paraphrasdd before being
communicated to anyone
4 p.m.
other than a Government
Agency (BR)
RESTRICTED
AMEMBASSY,
ANKARA
344
FOR STEINHARDT FROM WAR REFUGEE BOARD
WRB no. 25.
Hirschmann arrived Seturday. Tie are gratified to receive
his personal report on the difficult situation in Turkey which
you and he faced and which you are now facing. We are convinced
that his report in person was indispensable to the Board's con-
tinued program in Turkey.
Hirschmann is working here with us on the pending situations
and you will hear from us concretely as soon as possible.
The Board desires again to express to you its great apprecia-
tion for the unremitting and wholehearted support which Hirschmenn
has reported that you have given to all of the efforts of this
Government to save the lives of victims of Nazi oppression.
HULL
(GIW)
WRB:GLW:KG
NE
Cleared over the
telephone with
Mr. Wilson
Regraded Unclassified
263
PROPOSED CABLE TO AMBASSADOR STEINHARDT,
ANKARA, FROM WAR REFUGEE BOARD
Hirschmann has informed us in detail of the enormous
difficulties you overcame in personally arranging with the
Turkish authorities to allow the refugees from the SS MILKA
and the SS MARITZA to land in Istanbul and to be supplied
immediately with railroad transportation through Turkey to
Palestine.
Hirschmann also informs us that there will in all
probability be other boats approaching Istanbul, which are
in the same category, and that these also would not be
authorized to disembark their passengers in Turkey without
your personal intervention.
Highest commendation is due you for the resourceful
application of the goodwill you had built up with the Turkish
officials in dealing successfully with this work of mercy in
these crucial months.
This is War Refugee Board Cable to Ankara No. 27,
April 18, 1944
5:15 p.m.
Regraded Unclassified
264
EXECUTIVE OFFICE OF THE PRESIDENT
WAR REFUGEE BOARD
INTER-OFFICE COMMUNICATION
DATE Apr. 18, 1944
TO
Secretary Morgenthau
FROM
J.W. Pehle
This cable has been sent to Steinhardt and 18,
no doubt, in his hands already.
I am quite proud of the achievement which it
represents.
COPY
265
CABLE TO AMBASSADOR STEINHARDT, ANKARA, FROM THE WAR
REFUGEE BOARD.
The following refers to your No. 657 of April 12 from
Ankara to the War Refugee Board.
With respect to the replacement of 8 passenger vessel
of QUOTE an equivalent vessel of similar age, size and
general characteristics UNQUOTE for the SS TARI 8.8 designated
in Article 4 of the proposed charter with the Turkish
Government for the aforesaid ship, Hirschmann 18 in full
agreement with the position you have taken in your telegram
abovementioned.
Hirschmann and I conferred with Admiral Land of the
War Shipping Administration today. The War Shipping
Administration and the Foreign Economic Administration
have authorized you to commit this Government to the replace-
ment of the 83 TARI in the event of loss with 8 passenger
repeat passenger vessel 88 requested by the Turkish Government.
At this point every recommendation submitted by you
and Hirschmann to complete the negotiations for you to sign
the charter agreement for the War Refugee Board with the
Turkish Government for the SS TARI has been authorized.
Please refer to War Refugee Board cable to Ankara No. 20
relating to all the conditions mentioned in your numbers
585 and 594. The single obstacle remaining 1s the granting
of safe conduct by the German Government. We have taken
every available measure to expedite this safe conduct in
Washington as reported in our War Refugee Board cable No. 20.
Hirschmann informs me that Simond has expressed to him
unequivocally, unreserved confidence that von Papen would
arrange to obtain this safe conduct without delay. He also
informs me that Simond agreed personally to see von Papen
within a few days after his first meeting with him in Ankara has
not been obtained Hirschmann urges that both Simond and the
on this subject. Assuming that the German safe conduct
Apostolic Delegate from Istanbul arrange to see von Papen
without delay. Hirschmann reports that Simond expressed
in person in order to again urge granting of safe conduct
the view that he can succeed in securing the safe conduct
and he suggests that you personally confer with Simond along
the above lines without delay.
THIS IS WRB ANKARA CABLE NO. 26
April 17, 1944
6:10 p.m.
Regraded Unclassified
266
SANT
This telegram must J@
April 10, 1944
paraphressá sing
to
Jé
J P.".
= Government
agen (BR).
U.S. URCENT
ATTRASSY,
APR 21. 1944
CHUNGRING.
520
Please substitute for the phrase QUOTE removal of
the member country of restrictions Univers in paragraph
III-6 of the Department's no. 523 of April 17, 0 p.m.
2
the phrese QUOTE serioval Dy the member country of
restrictions UNAUORD.
HULL
(EGC)
4
111A:LOC: ja
4/10/44
Regraded Unclassified
77.02% 321
267
RMN
April 18, 1944
This telegram must be
paraphased before being
8 p.m.
X
communicated to anyone
other than a Government
(BR)
J. S. UT.CHIP
MIDDLEY,
RIO DE JANTIERO.
1251
FOR THE ALIBASSADOR PRO TW: SECRETARY F THE
CLEASURY
1. I would appreciate it If you would call upon
the Minister of Finance somptime Thursday, April 20,
and bond him the English text and trunslation of the
Joint Statement of the technical exports of the United
and Associated Nations recommending the establishment
of in international monotary fund. These documents
should be Given to Dulhoes also.
3. Please inform the :llnister of l'inanco that I
are appoaring on Fride7 bofore the appropriate Congres=
atonal condittoos to bring then up to date with regard
to our discussions on international monetary cooperation,
and to present to then the Joint Statement. The Joint
Statement will be published April 22, 1044 in a number
of the capitals of the United Nations including London
o.d Washington. It would be highly desirable if the
Regraded Unclassified
268
-?- 1251, April 18, 8 P.M., to R10 de Janeiro
statement mero released by the Minister for simultaneous
publication in Rio de Janeiro. It 1s of the utmost impor-
tance that this document should not be made public before
the morning of April 02, when it will be published in
Washington.
S. The following changes should be made in the text
proviously sent to your
QUOTE I-B To assist in the establishment of multilateral
payments facilities on current transactions
among member countries and the elimination of
foreign exchange restrictions which hamper
the growth of world trade.
II-1 Nonbor countries genll subscribo in Gold and
in thoir local funds amounts (quotas) to be
agreed, which will amount altogether to about
(8 billion if all the United and Associated
Nations subscribe to the Fund (corresponding
to about 020 billion for the world as a miole).
II-2
The quotas may be revised from time to time,
but changes shall require B four-fifths vote
and no number's quota may be changed without
Its assent.
Regraded Unclassified
269
-3- #1251, April 18, 8 to R10 ae J n=iro
&
II-3, paragraph e The obligatory gold subscription
of a member whose home areas have suffered
substantial damage from energy action or 00-
cupetion shall be only three-fourths of the
above.
III-e(e) The Fund's total holdings of the currency
offered (after having been restored, if bolow
that figuro, to 75 percent of the member's
quota) have not been increased by more than
20 persont of the newbor's quota during the
provious twolvo months and do not oxceod 200
porcout 02 the cuoton.
III-5 So long as a member country 10 ontitled to
buy another member's currency from the Fund
in exchange for 1ts own currency, it shall
be propared to buy 1te cam curroncy from
that member with that cember's currency or
with gold. This shall not apply to currency
subject to restrictions in conformity with
IK, 3 below, or to holdings of a current
account nature effocted before the romoval
Regraded Unclassified
w)
270
-4- #1251, April 18, 8 D.M., to Rio de Janeiro
+
by the member country of restrictions on
multilatoral clearing maintained OF imposed
under X, 2 belov.
VII-1
The Fund shall be Coverned by a board on
onc: member 17111 tho represented and by
an executive committee. The executive committee
shall consist of at least nine membors including
t.e ropresentatives of the five countries with
t w largest quotas.
VII-2
The distribution of voting power on the board
and the executive committee shall bo closely
related to the quotes.
X-3
The Fund may maleo representations to any member
that conditions are favorable to the withdrawnl
of particular restrictions or for the General
abandonment of the restrictions inconsistent
with I., s above. Not later than three years
aftor coming into force of tho Fund any member
still potaining any rootrictions inconsistent
with I., 3 shall consult with the Pund as to
their further retontion. UIRQUOTE
PM::00:ja
4/20/44
HULL
(EGC)
Regraded Unclassified
271
AMBAXAXX MESSAGE SENT
RMN
April 18, 1944
This telegram must be
paraphased beforem be&ng
X
10 p.m.
communicated to anyone
other ==== = Government
agency. (BR)
U. S. URGENT
AMEMBASSY
MEXICO, D.F.
815
FOR THE AMBASSADOR FROM THE SECRETARY OF THE TREASURY.
1. I would appreciate it If you would call upon
the Minister of Finance sometime Thursday, April 20, and
hand him the English text and the translation of the Joint
Statement of the technical experts of the United and
Associated Nations recommending the establishment of an
international monetary fund. These documents should be
given to Monteros and Gomez also.
2. Please inform the Minister of Finance that I am
appearing on Friday before the appropriate Congressional
committees to bring them up to date with regard to our
discussions on international monetary cooperation, and to
present to them the Joint Statement. The Joint Statement
will be published April 22, 1944 in a number of the capitals
of the United Mations including London and Washington. It
would be highly desirable if the statement were released
by the Minister for simultaneous publication in Mexico.
Regraded Unclassified
272
-2- # 815, April 18, 10 p.m., to Mexico, D.F.
-2-
It is of the utmost importance that this document should
not be made public before the morning of April 22, when it
will be published in Washington.
3. The following changes should be made in the text
previously sent to you:
QUOTE "1-B
To assist in the establishment of multilateral
payments facilities on current transactions
among member countries and the elimination of
foreign exchange restrictions which hemper
the growth of world trade.
II-1
Member countries shall subscribe in gold and
in their local funds amounts (quotas) to be
agreed, which will amount altogether to about
$8 billion if all the United and Associated
Nations subscribe to the Fund (corresponding
to about $10 billion for the world as a whole).
II-2
The quotas may be revised from time to time,
but changes shall require a four-fifths vote
and no member's quota may be changed without
its assent.
II-3
The obligatory gold subscription of a member
paragraph
2
whose home areas have suffered substantial
damage from enemy action or occupation shall be
Regraded Unclassified
273
-3- #915, April 18, 10 p.m., to Mexico, D.F.
->
only three-fourths of the above.
III-2(c)
The Fund's total holdings of the currency offered
(after having been restored, if below that
figure, to 76 percent of the member's quota)have
not been increased by more than 25 percent of
the member's quota during the previous twelve
months and do not exceed 200 percent of the quota.
III-5
Bo long as a member country is entitled to buy
another member's ourrency from the Fund in ex-
change for its own currency, it shall be prepared
to buy its own ourrency from that member with
that member's currency or with gold. This shall
not apply to currency subject to restrictions
in conformity with IX, 3 below, or to holdings of
a current account nature effected before the
removal by the member country of restrictions
on multilateral clearing maintained or imposed
under X, 2 below.
VII-1
The Fund shall be governed by a board on which
each member will be represented and by an
executive committee. The executive committee
shall consist of at least nine members including
Regraded Unclassified
274
-4- #815, April 18, 10 p.m., to Mexico, D.F.
the representatives of the five countries with
the largest quotas.
VII-2
The distribution of voting power on the board and
the executive committee shall be closely related to
the quotas.
X-3
The Fund may make representations to any member
that conditions are favorable to the withdrawal of
particular restrictions or for the general abandon-
ment of the restrictions inconsistent with IX, 3
bove. Not later than three years after coming
into force of the Fund any member still retaining
any restrictions inconsistent with IX, 3 shall
consult with the Fund as to their further retention.
UNQUOTE
HULL
(EGC)
FMA: EGC:eec
4/18/44
Regraded Unclassified
275
TELEGRAH SENT
This telegram must be
ceraphrased before being
April 18y 1944
communicated to anyone
accept a covernment
8 p.m.
(DR).
U.S. URGENT
AMEMBASSY
BAN JOSÉ (COSTA RICA)
Please CIRCULAR communicate the 'ollowing message from the
Secretary of the Treasury to the Minister of Finance and
Julio Peñe.
BEGIN QUOTE. 1. Discussions in proposale for international
monetory cooperation have been hold by the technical experts
of the United States with the technical experts of some
thirty countries. From the disoursions it acience olear that
it la the opinion as the technical experts the the most
practical method of assuring interdational monstery coopers
tion is through the establishment if an International
Monetory Fund.
2
On Friday, Apr11 21, 1944 Secretary Morgenthau will
appear before the appropriate Congressional dommittees to
inform them of the progress which had been made with regard
to international monetary ocoperation. At that time he
will present to them n. Joint Statement of the views of the
technical experts of the United and associated Nations as
to the principles which they believe should be the basie
Regraded Unclassified
276
-2-CIRCULAR, April 18, à P. to san Jose (Costa Rica)
for a Fund. The Statement will be published in the press
on April 22, 1944.
3. This Joint Statement will be a technical document only.
Governments would not be asked to give approvel %0
these principles until they ere enhadled S.D. the form of
Refinite proposals by the delegates of the United and
Associated Mations meeting in 9 formal conference.
4. It 18 important that the summery of the statement
given below should be treated as confidential and that 1%
not be roleased for publication prior to Aprill 22, 1944.
The full text of the Joint Statement 1s being sent by air.
A summary of a draft of the Joint Statement follows:
Beginning of Bummery.
The experts propose the establicement of an International
Monetory Fund as a permenent institution for international
monetary dooperation. The purposes with DO to promote
exchange atability, assure multilateral payment fecilities,
help lessen international disequilibrium and we confidence
to member countries. All of the United and Associated
Nations would subscribe approximately :e billion to the
Fund in the form of gold and local ourrency in accordance
with an agreed formula. The resources of the Fund would be
Regraded Unclassified
277
-3-CIRCULAR, April 18, 8 p.m., to San Jose (Conta Rica)
available under adequate safeguerds to help member
countries to maintain exchange stability while they correct
maladjustments in their balance of payments.
Member countries would be able to buy foreign exchange
from the Fund with their own currency to meet payments
consistent with the purposes of the Fund until the Fund's
total holdings of their currency reach 200 percent of their
quota. If a member country makes use of the Fund in a
menner contrary to its purposes and policies, the Fund would
give appropriate notice that it would sell additional
exchange to the member country only in limited amounts.
Member countries holding adequate gold and exchange resources
would be expected to pay for half of their exchange purchases
with gold, and countries whose official holdings of gold 139
adequate and are increasing would be expected to use half
of the increase to repurchase part of the Fund's holdings of
their ourrency.
When the Fund°s holdings of a ourrency become scarce,
the Fund would issue & report and make recommendations
designed to increase the supply of such currency. In the
meantime, after consultation with the Fund, member countries
would be authorized temporarily to restrict freedom of
exchange operations in the soarce currency.
Regraded Unclassified
278
-4-CIRCULAR, April 13, 8 p.m., to San Jose (Costa Rica)
The Fund's resources could not be used to meet a large
outflow of capital, slthough they could be used for capital
transactions of reasonable amount. A member country could
also use its own resources of gold or foreign exchange for
capital transections that are in accordance with the purposes
of the Fund.
The par value of the currencies of member countries would
be expressed in gold and could be changed only at the request
of member countries. The Fund would approve a requested change
in parity if it were essential to correct fundamental dis-
equilibrium. After consultation, a member country would be
permitted to change the parity of its ourrency by not more than
10 percent. Prompt consideration would be given to requests
for adjustments of exchange rates.
The Fund would be governed by a board and en executive
committee representing the members. Voting power would be
closely related to quotas. A member country could withdraw
from the Fund immediately by giving notice in writing.
Thereafter, the reciprocal obligations of the Fund and the
country would be liquidated within e reasonable time.
Member countries would not allow exchange transactions
at rates outside a prescribed range based on the agreed parities.
Regraded Unclassified
279
-5-CIRCULAR, April 18, 8 p.m.. to San Jose (Coste Rica)
They would not be permitted to impose restrictions on
payments for current international transactions, or to
engage in discriminatory currency arrangements or multiple
currency practices without the approval of the Fund.
During the period of transition following the war,
member countries would be permitted to retain their exchange
controls with the expectation that these would be gradually
relaxed. Three years after the establishment of the Fund
eng member still retaining restrictions inconsistent with
these principles would consult with the Fund as to their
retention. The trensition period is recognized as one of
chenge and adjustment and in deciding on requests presented
by members the Fund would give them the benefit of any
reasonable doubt.
END OF SUMMARY AND QUOTE.
Repeat mutatic-mutendie to Amembassy, Ciuded Trujillo
Amembassy, Panama
Amembassy, Quito
Amembassy, Montevideo
In first paragraph in place of "Minister of Finance and
Julio Pena" substitute "Minister of Finance".
Regraded Unclassified
280
-6-CIRCULAR, April 18, 8 D.M., 00 San Jose (Coste Rica)
To Amembassy, Port-au-Prines. In place of "Minister of
Finance and Julio Pena" substitute "Minister of Finance
and Chauvet".
To Amembasey, Santiago. In place of "Minister of
Finance and Julio Pena" substitute "Minister of Finance
and Illanes".
To Amembasey, Asuncion. In place of"Minister of
Finance and Julio Pena" substitute "Minister of Finance
and Gonzales".
To Amembasey, Caracas. In place of "Minister of
Finance and Julio Pena" substitute "Minister of Finance
end Corrondona and Guerrero".
HULL
(EGC)
FMA;EGC:eeo
4/18/44
Regraded Unclassified
NOT TO BE RE-TRAI SMITTED
COPY NO,
SECRET
OPTEL No. 125
Information received up to 10 A.M., 18th April, 1944
1. NAVAL
On 17th A Canadian Catalina made a promising attack
on a U-boat southwest of ICLLAND (C).
2. MILITARY
ITALY. A strong German raiding party was rebulsed
about 4d miles north of CASSINO.
BURMA, Our troops have compelled the Japanese to
evacuate a position 12 miles northeast of IMPHAL on the IMPHAL-
KOHIMA road, but enemy parties still remain southwest of this
point. Further localities have been cleared and counter-attacks
repelled on the KOHIMA-DIMAPUR road just west of KOHIMA, but
Japanese parties reported in strength north and south of this area
3. AIR OPERATIONS
WESTERN FRONT. 17th. Weather restricted operations.
Liberators dropped 45 tons on military constructions Northern
France, 17th/18th. Aircraft despatched:-
Sea mining
20 (1 missing)
COLOGNE
26
LE MANS Marshalling Yards 2
Leaflets
7
Intruders
2
RUMANIA. On 15th/16th 83 Wellingtons dropped 135 tons
H.E. including 13 4,000 pound bombs together with incendiaries on
Marshalling Yards at TURNUL SEVERIN. Subsequent reconnaissance
shows bombing well concentrated and severe fire damage. Locd-
motive round house destroyed, railway work shops burnt out, goods
sheds demolished and several wagons destroyed. 3 Wellingtons
missing, (2 by collision). 1 JU 88 destroyed.
ITALY. 16th. Total 104 medium bombers attacked bridge
near ORVILTO and ammunition dumps west of SPOLETO.
Regraded Unclassified
282
April 19, 1944
Clif Mack rode down with me this morning from
the house, and I asked him whether there was anything
special, and he said, "Yes." He said that he understood
Clayton had written us a letter - he said he hadn't
actually seen the letter but he had heard about it -
saying that there were another eight or nine hundred
cars which he would like the Government to have between
now and the first of July. He asked me whether that
was okay, and I said "Yes." He said that this leaves
us with eight or nine hundred cars on hand, and he
asked me whether I wanted to go ahead with them in
letting non-tax supported organizations or individuals
have these cars even though we got less for them, and
I told him that that is what I wanted. "But," I said,
'these eight or nine hundred cars the RFC has, I want
you to take that up with Clayton and see that their
cars are pooled with ours so the RFC can't say that they
got $300 a car more than we did. Mack thought that was
an excellent idea. Mack told me that the RFC had these
cars for a long time, and evidently the matter had been
handled very badly.
I told Mack that when he went into this thing
he should please have Tickton present so that he can give
me a statistical picture on the RFC. I again stressed
the fact that when we released our cars the RFC cars
should also be released. Mack said he would do it.
Regraded Unclassified
283
VICTORY
TREASURY DEPARTMENT
BUY
STATES
WAR
BONDS
PROCUREMENT DIVISION
STAMPS
WASHINGTON 25
ICE OF THE DIRECTOR
April 19, 1944
everyDum 10 THE SECRETARY:
A conference was held with Mr. George Marrison, hide and
lesther expert with RFC, who is cooperating with us in the de-
velopment of outlets for the new lot of shearlings recently
declared to us.
A conference was held with Mr. Willett of RPC, and Kr.
lickton, to discuss the coordination of the respective programs
of RPC and Treasury Procurement for the disposal of passenger
vehicles. RFC's stock of about 900 passenger vehicles, acquired
since July 1943, are for the most part higher price CBTS than
ours. Consequently, sales have been slow. As a result of in-
formation obtained, it is believed that it may not be necessary
to accept a lower price ceiling for sales to dealers then to
tax-supported organizations, and a conference is being arranged
with OPA for that purpose.
The Chief Coordinator's Office, Treasury Intelligence, has
promised to give us three-day service in the character invosti-
gation of applicants for positions on our marketing staff.
A meeting of the Federal Space Control Board, consisting
of representatives of Treasury Procurement, Reconstruction Fi-
nance Corporation, and the Army and Navy, wes held for the pur-
pose of discussing plans and procedures in connection with the
acquisition, inspection, allocation, operation, and control of
such storage space as will be required for the storage of material,
end material controlled by, and under the jurisdiction of Govern-
ment agencies. Discussion was particularly focused on the
feasibility of establishing sub-committees to control the use
of space by Government agencies in each region.
your Clifton back
Director of Procurement
Regraded Unclassified
284
April 19, 1944
10:50 a.m.
FIFTH WAR LOAN DRIVE
Present: Mr. Gamble
Mr. Smith
Mrs. Klotz
MR. GAMBLE: That is a tough part of the country,
too.
H.M.JR: Talking politics - funny - here was Dean
Acheson and all these people here yesterday about
my going up on the Hill. I said, "This monetary conference
will be good for world stability, will be good for the
American businessman, and for the Democratic Party!"
I thought that Dean Acheson would fail out of his
chair.
I said, "Is that a new language?"
All he did W&S shake his head.
I said, "Anybody around here object?" You (Mrs.Kiotz)
were here.
MRS.KLOTZ: Yes, I know.
H.M.JR: I said, "I couldn'tmake that remark in
Cabinet, though."
Well, it is time somebody talked about the Democratic
Party - who is working for Mr. Roosevelt. There is the
forgotten man of the Party.
What's his name said, "You want to get some of the
romance of the >outhwest." --Sure, Coca Cola, Pepsi Cola,
Crazy Crystals--
Regraded Unclassified
285
- 2 -
MRS. KLOTZ: What is that, 8. drink?
MR. SMITH: It makes you thin if you are fat and
makes you fat if you are thin.
H.M.JR: It is Vichy water - good for what ails you.
MR. GAMBLE: Doctor Pepper you have also in Texas.
H.M.JR: Sure, the romance of the South!
Well, you have had time to think about it, dear
friend (Gamble)--
MRS. KLOTS: Sounds like a song.
H.M.JR: Now, do you boys want me to go to Texarkana?
MR. SMITH: We are agreed you should open in
Texarkana Sunday night, June 11.
MR. GAMBLE: Yes, indeed.
H.M.JR: That is up in the northeastern corner of
Texas.
MR. SMITH: A line right through the middle of the
street and through the middle of the hotel. It is on
the State Line.
H.M.JR: It is 8. very rich part of the State.
SMITH: And very colorful. I am fascinated think with
it. MR. What do you think about the President? Do you
we can hook him on the end of it in here?
H.M.JR: I think you are going to have to get the
radio thinks it is & good place for his voice that to
time without using his name, and then if the
President maybe - it will have to be something and
will come from, come at the end. You will have to go ahead sell
it on the strength of what you have.
Regraded Unclassified
286
- 3 -
Mic. SMITH: We can set up a good program and if he
comes in probably open up at least one more network,
anyway.
MR. GAMBLE: I don't like to have any problem on
the time, Fred.
H.M. JR: You will have to do it exclusive of the
President. When he comes back I will say, "This is
what I am going to do, and I would like to have you
join me."
MR. GAMBLE: Our biggest job is the Fifth War Loan
and I think it should be right.
H.M.JR: I would like to have him on, but you have to
get your radio time based on the Fifth war Loan, plus me.
MR. GAMBLE: Yes, well, I think that makes sense.
If you get into that argument they will toss it back
and forth for three or four weeks.
H.M.JR: You have to just tell it on its merits,
minus the President. If he comes in it is an added
attraction.
MR. GAMBLE: I think we ought to take the Red Net-
work to give us the best spot on the air.
H.M.JR: What is the red?
MR. GAMBLE: NBC, it is the best.
H.M.JR: Well, that again I don't know. Of course,
I like Columbia.
GAMBLE: I think you like it, probably, because Our
of MR. experience on Columbia - "We the People." -
idea your here is to replace some top commercial program
Chase and Sanborn, or something.
Regraded Unclassified
287
- 4 -
H.M.JR: We haven't used this person, but I gather
through Pehle, and so forth, that he is friendly to what
I am doing down here, and that is Herbert Bayard Swope,
who is one of the principal stockholders in Columbia,
and is a Publicity Adviser to the War Department. I an
throwing this out as & suggestion. He is a man who gets
around and bobs up in all kinds of places. Think it over.
It wouldn't do any harm, maybe, to make him an Adviser on
the Fifth war Loan. I mean, he is a man who throws off
& million ideas. We have nobody like that around. I am
just throwing it out. He is eccentric like all publicity
and public relations people.
MR. GAMBLE: Good morning, Mr. Smith!
Mr. SMITH: Oh, I am just getting & thick skin. I
am getting accustomed to being insulted in this office.
It doesn't matter to me any more.
MRS. KLOTZ: I will repeat that to you sometime,
Mr. Smith. I will use it.
H.M. JR: Anyway, we will go along on Texarkana.
This is the way I would like to do. I know you boys
don't like this. I know it isn't the way you work, but
it is the way I like to work, and I cuss about it after-
wards, and cuss Smith out, and all that sort of thing.
I would like to do it the way I have done the other. You
book me for this, then I would like to see how the thing
develops, see?
MR. GAMBLE: We have several good suggestions. I
think maybe one you want to act on--
SMITH: No, the times and places are subject to
change MR. without notice. We thought on the 14th, shortly
after opening - that would be on wednesday night -
tary program. Go on the air with someone like
our good your radio night - that you would do & straight Eisenhower mili-
and people like that.
MR. GAMBLE: Stick to top military - top Navy.
Regraded Unclassified
288
- 5 -
MR. SMITH: Share the time with them and really make
it a military operation, and if possible on that day
make it a military day and get all our people out in the
field to get out bands, and so forth.
H.M.JR: Do you want it as quick as that?
MR. GAMBLE: The reason is that we get the maximum
good if we have it in the early part of the drive. I
think this is & good sales program.
H.M.JR: All right. (To Mrs. Klotz) Do you want
to make notes as we go along?
Somebody was talking to General Greenbaum and he
said he first used this on nis wife when something confi-
dential came up - he said, "Now remember, please don't
let it go in one ear and out of your mouth."
MRS. KLOTZ: That is very cute. What am I supposed
not to let out of my mouth?
H.M.JR: He will come to me on the first of June -
"Don't you know you are going to Texarkana?"
MRS. KLOTZ: He is supposed to send us a memorandum
when these things are decided.
H.M.JR: I know, Mrs. Klotz, but you are my Assistant.
MR. SMITH: Ya, ya, ya!
MRS. KLOTZ: Then the rulings have changed as of this
minute!
The other day when Sullivan started to go after Fitzgerald
H.M.JR: what applied to Fitz would apply to Smith.
Gaston said, "You are taking something on. he will get
the last bite" - if you get what I mean.
Anyway, you boys want me to go on June 14th?
Regraded Unclassified
289
- 6 -
MR. GAMBLE: We can do it from Washington.
H.M.JR: If I am down there, I would rather do it
somewhere out in the Middle west. 1 would rather stay
out there.
MR. GAMBLE: we want to bring Eisenhower in.
H.M.JR: To Washington?
MR. GAMBLE: We want to bring him by short wave.
H.M.JR: If I an down in that part of the world I
would rather keep right on going. I don't want to come
back to Washington. You can have it!
MRS. KLOTZ: Oh, I love that remark.
MR. SMITH: We could move up to Detroit and do your
industry-labor spot next. It is a long way from Texarkana.
I don't know whether he considers that keeping going or
not.
MRS. KLOTZ: Mr. Gamble, get him to California and
keep him there.
MR. GAMBLE: I have been trying to get him to
California since the beginning of this program. In the
Third War Loan I was thrown out the back door of his home.
H.M.JR: I am in Texarkana and I have from Sunday to
Wednesday.
MR. SMITH: You can go to California.
H.M.JR: I will go to California. Do you want to do
a military number from San Diego?
MR. GAMBLE: San Diego or Los Angeles, either one.
San Diego would be an excellent place; everybody recog-
nizes it as B. Naval Base.
Regraded Unclassified
230
- 7 -
H.M.JR: The only trouble is, everybody's mind at
that time will be on Europe. 1 mean, 1 wonder, with
everybody's eyes on Europe, do I want to talk from San
Diego?
MR. GAMBLE: I think it is all right as long as your
setting is all right. We will have Eisenhower on the
program; no matter what spot in the country it originates
from, it is going to have the appeal that you want it to
have.
MR. SMITH: I don't think that matters.
MR. GAMBLE: People in San Diego will be just as much
interested in what is going on in the Atiantic.
H.M.JR: All the airplanes are in Los Angeles. It
could be either Los Angeles or San Diego.
MR. GAMBLE: San Diego may be too much naval atmos-
phere - but you have Lockheed and all of them.
H.M.JR: You can do it in the Rose Bowl.
Mit. GAMBLE: The Hollywood Bowl - the Rose Bowl is
too big. It is out in Pasadena.
MRS. KLOTZ: Lid you mean the Hollywood Bowl?
H.M.JR: Yes, where they have these concerts and
things.
MR. GAMBLE: The Rose Bowl seats a hundred and four
thousand people.
if H.M.JR: went to San Diego it would be too much Navy. after
I was mixed up. No, if I am out there -
all, we the eyes of the world are going to be on Europe.
GAMBLE: They have some big military establish-
ments MR. in California. We have Camp Roberts, one of the
biggest in the country.
Regraded Unclassified
291
- 8 -
H.M.JR: I don't want to go to a camp. After all,
the planes that they are going to be fighting with,
and so forth and 80 on, will be Douglas and Lockheed and
Vultee and North American.
After all, the greatest fighting ship of all is the
P-51; the North American P-51 is the most successful
fighter, which is made in the Los Angeles area.
MR. GAMBLE: It is the perfect time of the year to
go to Los Angeles. The weather is good. No danger of
rain or bad weather at that time. It will be a perfect
time for an outdoor show.
H.M.JR: I could go from Sunday to Monday.
MR. GAMBLE: In three days it would be leisurely.
It is only tweive hours from Texarkana to Los Angeles.
MR. SMITH: You could even go by way of Portland.
H.M.JR: Did you know this plane that came through -
Mr. Frye came to see me a couple of years ago and I helped
him to get the release on the engines. He came to see me.
I helped him get the engines. I think that that will be
all right.
MR. GAMBLE: Swell. There isn't any place in the
country that we can do better.
H.M.JR: That will be 8 military number. Then what?
MR. GAMBLE: The next idea you are not going to like
at all.
MRS. KLOTZ: May I have the dates on these?
MR. SMITH: June the 14th, Wednesday. June 11 is
Texarkana.
Regraded Unclassified
292
- 9 -
H.M.JR: This is minus Glenn Miller's band. Inci-
dentaily, you know I am devoted to Paul, bit after all,
when Broadway knows I am going out on tour with Gienn
Miller's bank, before I know it, it is not so good.
Go ahead.
MR. GAMBLE: This is unimportant, where we can do it.
Probably the best place will be Detroit. You probably
won't be too crazy about the suggestions involving some
personalities. We would like to take Henry Ford and
Henry Kaiser, K.E. Keller, William Green and Philip
Murray, and do what would really be a good "round table."
I know this "round table" idea is not popular, but I
think this would be popular because of the combination
of characters. Henry Ford is still a good name in this
country; Kaiser is a fabulous character. Do the best
job we have ever done about why eve ybody ought to be in
this Fifth "ar Loan Drive, and have the top labor and
management people - pick management people like I have
suggested for their color. Pick management people that
are going to help build an audience for that kind of &
show.
H.M.JR: I don't object to that. I would rather fix
it ano let you work on it. I would rather bill that from
the next Sunday night.
MR. GAMBLE: That is on June 21.
H.M.JR: what will you CO with me once you get me
in Los Angeles?
MR. GAMBLE: This is a week later.
H.M.JR: Do you want to shoot me up the coast and
let me do San Francisco and Seattle?
MR. GAMBLE: I don't want to try to commit you to 80
many things that you can't do them. I would rather start
with not over four.
Regraded Unclassified
293
- 10 -
H.M.JR: You have got me in Texarkana, Los Angeles,
that is the 14th, and then on the 21st in Detroit.
MR. SMITH: Would you object to moving that up so
he can catch it on the way back?
MR. GAMBLE: No, Fred; we could do that.
H.M.JR: I would rather do it on the way back.
MR. GAMBLE: We could move it up to, say, Monday
night. You wouldn't want to move it up to Friday, would
you?
H.M.JR: Why not Sunday night?
MR. SMITH: Sunday is an awfully hard night on the
air. If you haven't got control of the air, there are so
many good shows you just don't get listened to. Saturday
night is a good night on the radio.
H.K.JR: It is not ?
MR. SMITH: It is a good night for us, because it
isn't a good night for anybody else.
MR. GAMBLE: ne can do it Saturday night on the
way back. That gives you three days.
MRS. KLOTZ: What date?
MR. SMITH: Wednesday the 14th, Thursday the 15th,
and Saturday the 17th.
MRS. KLOTZ: The 17th, where?
Ma. SMITH: Detroit.
H.W.JR: In other words, you want me in the first
week to get the thing started.
Regraded Unclassified
234
- 11 -
MR. GAMBLE: I would rather do the things in those
days that are going to be the best for our sales. And
this is the sort of thing that would help us more.
Now, we have one more good idea, and I think you
will like this one, before the finale, which is on July 4.
This is tentative and has to remain tentative until we
get the Navy's green light. But we are trying to make &
big Navy tie-up of about fifty cities on the 4th of July,
where the Navy will virtually turn over to us everything
they have in this country in the way of troops and equip-
ment and bands and go into Soldier's Field, and Yankee
Stadium, and the principal cities of the country and do &
job on the 4th of July. If we are successful in that, we
ought to pick the best snow and take the Secretary of the
Navy and possibly Admiral King and yourself, and do 8 show
from one of those public celebrations on the 4th of July.
H.M.JR: You are having the Army ones and then the
Navy.
MR. GAMBLE: The reason we picked the Navy for this
is because the Navy nas a semi-annual Bond Drive themselves
in the month of July. They have a December and a July Bond
Drive. If you put the two of them together you don't get
anything from either one. If you take one of them and
make it an important affair as far as they are concerned,
you will get something. Here in the District we are going
to have an Air Force show during the campaign - numerous
4th of July we pick as Navy Day 80 we will get all-out
Army activities going on all during the show. But the
support.
Whether it is Soldier's Field in Chicago, or Yankee
Stadium - wherever we have the most colorful affair, I
would like to use that as a backdrop for talking about
the whole activities all over the country.
H.M.JR: Put it down.
Mrs. Klotz, we should write 8. memorandum to Harry
White and say if their monetary conference comes off he
knows this is booked up for the Fifth War Loan, so he
doesn't say we are going to have the monetary conference
just at that time.
Regraded Unclassified
295
- 12 -
MR. GAMBLE: We don't want to commit you for anything
more now.
H.M.JR: Are you through now?
MR. GAMBLE: I have the slogan.
MR. SMITH: We have lots of slogans here. One is,
"Buy the bonds you can't afford today."
"Buy double the extra bonds you bought last time."
"Buy more than before in the Fifth War Loan."
"Buy more--double what you did before."
"The job is big, you have got to dig."
"Let's put the V in invasion."
"We must do more to win the war."
"Insure invasion."
Tnvest--buy more than before."
"Fight by his side and join the fight."
H.M.JR: I don't like any of them.
MR. GAMBLE: One we can dress up-- "Buy more than
before." There are two schools of thought.
MR. SMITH: I think that is a practical one.
H.M.JR: Well, now, listen, the big thing in buying
also has to be "Back the attack." Now, you are not going
to be able to budge me on that. I argued with you last
time, and what was it?
MR. GAMBLE: "Let's all back the attack."
Regraded Unclassified
2°6
- 13 -
H.M.JR: It went over, didn't it?
MR. GAMBLE: Yes.
H.M.JR: What is this thing?
MR. GAMBLE: "Buy more than before."
MR. SMITH: But if you wanted to say "Back the
attack, you could say, Back the attack; do more than
before.
MR. GAMBLE: "Back the attack; buy more than before."
H.M.JR: I would like you to do this: Get some
artists and some fellow who knows words like this man that
is still here who was the chief copy writer for your former
organization. Is he still in town?
MR. SMITH: No, he is in New York running it now.
I would like to see the thing aurally and visually. I would
H.M.JR: There are two things: It issural and visual.
like to see them take the two things visually.
MR. SMITH: You could take some of the ads you have
and put this slogan on the bottom of the ads.
MR. GAMBLE: We will have them back this afternoon,
if you will tell us.
H.M.JR: You contact Mrs. Klotz. I can't tell this you,
because this afternoon I have to go to school on
other thing, but I can take a minute off.
GAMBLE: We are boiled down to "Buy more have than
before," MR. because people in the field say, "Let's a
slogan that tells people to buy bonds."
H.M.JR: Do you like that, Mrs. Klotz?
MRS. KLOTZ: It is the best of those you have on the
list, but it wouldn't move me.
Regraded Unclassified
297
- 14 -
MR. GAMBLE: I agree with that, Mrs. Klotz. It
is not as good as "Back the attack," or "Fight by his
side," or any of a dozen others. But it does suggest
one important thing about the Fifth War Loan, that every-
body is expected to buy more than they have bought before.
After all, a slogan, if it can serve one good purpose,
is worth promoting.
MRS. KLOTZ: Did you just start "Fight by his side"?
H.M.JR: I don't want it. You are not fighting by
his side when you are buying a twenty-five dollar bond.
That is hooey.
MR. GAMBLE: We have argued that out all across the
room and back, and all the top advertising men in the
country as well as folks in our own shop, don't dislike
"Fight by his side."
MRS. KLOTZ: I think it conveys 8. lot, yes; it is
true you don't fight by his side by buying a bond, but
it is the feeling that you want to give, or do, in order
to fight by his side.
H.M.JR: You can't get it over to me.
MR. GAMBLE: We are not going to use it as a siogan
We are using it in some of our copy.
H.M.JR: That is all right. You can't get it as a slogan
any more than you can get across as a theme, "Dear Friend."
Now, can I have my two bits?
MR. SMITH: It is all right with me.
MR. GAMBLE It is all right with me.
H.M.JR: Did you get my letter about the missians?
MR. GAMBLE: Yes, sir.
H.M.JR: Anti-Nazi--
Regraded Unclassified
298
- 15 -
MR. GAMBLE: Yes, sir.
H.M.JR: Will you try it somewhere?
MR. GAMBLE: If you insist.
H.M.JR: Yes.
MR. GAMBLE: But I don't like the idea.
H.M.JR: Now, listen, nobody yet has come up with a
new idea.
Mrs. Klotz, did you read the memorandum?
MRS. KLOTZ: Which memorandum?
H.M.JR: Let Mrs. Klotz read the memorandum.
(Mr. Gamble hands Mrs. Kiotz memorandum from the Secretary
on use of anti-Nazi war prisoners)
H.M.JR: Smith told me--I mean, when I heard these people
talk the other night over in the Chamber of Commerce--they
are still talking stuff we gave them two years ago. Now,
do what Old Gold has done, test it. Nobody is going to know
the only way to tell whether I am right or wrong is to
about it, but I want to take a real anti-Nazi war prisoner
and let him be tried out. Give him an audition, and let
them see how the people react. You just don't know; he
myself, you see. I want an anti-Nazi soldier to say, "This
may go over. I want a fellow--I would like to talk to him
is what the Nazis have done to me. I want you to know what
they have done to me, and tell what they have done to this
fellow. See?
But that story hasn't been told. The trouble is, Ted,
let me just take a minute. I have been in New York at the
Hotel Pennsylvania last night. The thing I hope isn't going
to happen, with all that is in me, is this country is going are
to get an awful shock when this invasion comes, and we
not ready for it. Nobody has prepared us, see.
Regraded Unclassified
299
- 16 -
MR. GAMBLE: I agree.
H.M.JR: Nobody knows how this country is going to
react to it. I don't know who it was, but somebody said
to me that they just couldn't understand Time and Hamilton
Fish. It was shown that he helped Viereck, but the Congress
of the United States didn t get up and try Hamilton Fish.
Do you see? Nobody in the whole Congress of the United
States, as far as I know, attacked Hamilton Fish for what
he did to help this fellow Viereck.
MR. GAMBLE: No, they didn't.
H.M.JR: Now, along comes the American Legion, and
the people are getting excited about it. But I mean,
there is a complacency in this country.
MR. GAMBLE: I am completely in your corner on that.
H.M.JR: I may be a hundred percent wrong, but at
least I am going to insist. I don't care whether you
took this Englishman's song, "Don't be Unkind to the Germans"--
well, I am not going to force it.
MR. GAMBLE: We did take it and distribute it; we made
an excellent program. It was played, not universally, but--
H.M.JR: Did you get any unfavorable criticism?
MR. GAMBLE: No, we didn't.
H.M.JR: Did you get a single letter?
MR. GAMBLE: No.
MR. SMITH: You may sit in a corner.
fire, but at least I asked you to do it. Is it downstairs?
H.M.JR: I don't say it would set the world on
MR. GAMBLE: Yes.
Regraded Unclassified
300
- 17 -
MR. SMITH: By the way, the Hitler gang is downstairs,
too.
H.M.JR: Now, you were afraid of that, and I happened
to be right. I don't know whether I am right or wrong, but
I want you to try it. And the fellow who can get it for
you, & man like this, because it goes through his office,
is General Greenbaum. He may protest terribly, but I want
to take one of these people, and I want them to go to two
or three different kinds of audiences, and I want to talk
to the fellow before he makes his speech. I want to try
this fellow out.
Now, as I say, the Russians have done it, and they
have capitalized on it.
MR. GAMBLE: I think they have, Mr. Secretary. My
only fear, 60 you will get my thought on it--and this is
the reason I don't like it--is that I think it has been
necessary to sell the people in this country to some extent
the idea that all the German people are in this war and
you are going to have to do a pretty good job of defeating
the total people so far as the military establishment is
concerned, and that you may have to do a job of regimenting
the affairs of that country for & number of years. This
sort of subscription to the idea there are & lot of good
Germans--
H.M.JR: No, no, you don't get the point.
MR. GAMBLE: I apparently don't.
H.M.JR: I don't think there is one person in ten in
this country that really understands Naziism and what they
have got to take these losses in, in order to crush them.
do to the people. See? Or that this is something you
about the Russian Army, and for some reason which
Now, as General Arnold said to me--. I said I something
don't defensive just now. I don't know why they have
understand, the American Air Corps is very feel much that on
way. I can damned much; and now saying they can't thought the
the understand 8. little bit, because they lick
talked thing from too the air. But up to very recently, they
Regraded Unclassified
301
- 18 -
they could. But the point that General A nold said
was, "Don't forget, Mr. Morgenthau, that the Russians
threw twenty-five million men into this fight." Now,
he didn't pursue it, but the idea was that we have trouble
getting an eight-million-man Army, see?
Now I say to you that the American public is not yet
prepared to take the casualties which we are going to
have to take, and they don't know or understand, still,
what Naziism is.
I would like to try out a fellow who has been through
this thing, what it has done to him, and his feeling -
to have him get up and say, "This is what Naziism is. 1
want to tell you what it has done to me as a human being,"
and let's see the reaction on the audience.
Now, every time I have talked - and I haven't talked
to many labor groups - but every time I have talked to
the labor groups and have gotten tough about the Germans -
it is the only time I got applause.
MR. GAMBLE: I agree with that.
H.W.JR: Now, I may be all wrong, or I may be all
right - either this is a gold mine for you, or it is a
complete bust. But take it from me, when it gets down
to the American public, and when these casualties begin
to come in - and tell them that they have got to crush
this thing - begin with the soldiers themselves. Nobody in
what's his name's propaganda to the soldiers telling
knows why we have to do it. Have you read anything
them why they have to crush Naziism? Have you seen my
booklets on it?
MR. SMITH: No, their orientation things touch on
it, but very lightly.
H.M.JR: Have you seen anything?
MR. SMITH: Yes, there is something in there.
Regraded Unclassified
302
- 19 -
H.M.JR: No, I mean really.
Mr. SMITH: Nothing concrete.
H.M.JR: That will make the mother and father say,
"This is so terrible that I am willing to have my kins-
folks die for this thing."
Mr. SMITH: I will say they are starting on this.
They want our Chamber of Horrors to use as a record.
They have gone to work as of last month.
H.M.JR: Still, there is nothing there that makes
you willing to have your kinsfolk die for this thing.
Now, that thing does not exist in this country.
Now, maybe this isn't it, but I tell you, Ted,I want
to try it.
N. GAMBLE: I agree with you, but I wonder whether
8. Nazi soldier is the fellow to do it.
H.M.JR: I am not saying & Nazi soldier, but I am
saying 8. German soldier who is anti-Nazi. And don't for-
get that the "merican public is a melting pot. My father
and mother were born in Germany. This is a melting pot.
But this is something that you have got to learn so that
are willing to crush it, and buy bonds to do it. But
you I don't want them to talk about buying bonds; this is
psychological salesmanship.
MRS. KLOTZ: Mr. Morgenthau, look what that Marine
did the other day. lie did something to everybody in
that audience.
H.M.JR: He was the best thing out.
MRS. KLOTZ: He came back after he was there, and you
felt you were there with him.
H.M.JR: The rest was such tripe it just was terrible,
but that Marine was good.
Regraded Unclassified
303
- 20 -
MRS. KLOTZ: I will never forget him; that is the
effect it had on me.
H.M.JR: But those are the boys who should talk,
but please don't block me on this thing. I want to try
it if I have to go up to the President of the United
States.
MR. GAMBLE: Well, I just wanted to give you my
views on and we will do it.
H.M.JR: Do you understand a little bit more now?
MR. GAMBLE: Yes.
H.M.JR: I don't want them to say B. word about buying
bonds, but what I am hoping for is the thing that Howard
Dietz once told me. he said never have a picture so that
explain the last thing to the audience. Leave it to
you the audience to work the thing out - so that he can follow
the thing and he, himself, or she, works it out. Then
you get the audience's reaction. Certainly he is a past
master at that. He is good, isn'the?
MR. GAMBLE: Yes.
credit. Now, as they sit there, if you can really get
H.M. JR: And you have got to give the people the
them mad 80 they say, "By God, I am going to do this and is
that," then you have accomplished something - and he
going about buying bonds. But I want them to try it. Try is the
to buy some bonds. I don't want them to say 8. word it
munitions workers. That is what I want to try.
with the people who have the most money, and that
MR. GAMBLE: I will go to work on the good General
this afternoon.
H.M.JR: I don't know that Greenbaum is the right
fellow. How is your contact?
MR. GAMBLE: Greenbaum is the man. Gow is very good.
Regraded Unclassified
394
- 21 -
H.M.JR: Who is Gow?
MR. GAMBLE: he is a Colonel under Greenbaum. He
is in the Incentive Division.
H.M.JR: He is from Boston?
MR. GAMBLE: An attorney.
H.M.JR: When we wanted these tanks--
MR. GAMBLE:
...he is the fellow who got them.
H.M.JR: Let's try. You can go to Baltimore, Norfork -
you don't have to go very far. You can go up to Hagerstown -
wherever this factory is. I want to be in the audience
myself - I want to be there. I want to taik to the fellow
beforehand and I want to be in that audience myself. I
want to talk to the laboring people. I want to try it on
8. Negro audience, and believe me, something has to be
done with the Negroes to interest them in this war and
make them feel it is their war. I would like him to talk
to the Negroes. You go to work with this thing. It is
either an idea that is worth a billion dollars, or it is
worth nothing. Are you interested?
MR. SMITH: I am interested. I am not objecting to
8. test at all, understand. I have just one thing that
worries me 8. little bit, and that is that the American
people don't like people who poach, who don't play on
their own teams. A Nazi soldier comes from Germany. If
Nazi or whatever they are, are horrible people, you have
he comes up and saysthat the people in Germany, whether
a the underground. The American people will not be interested
conflict there. It is the same trouble we have with
in the underground because those people cheat.
man take it out of the category of a confession. Maybe you
first, I believe you could set up something that would
On the other hand, it might be if we talk to this
could of & little show - some sort of 8 thing so there could be
have three or four people and work out some kind
Regraded Unclassified
375
- 22 -
a good big explanation of what goes on, and make some-
thing. I think ou would get around that feeling.
H.M.JR: A fellow that I would like to have work on
this thing - I would like Pete Odegard to sit in on this.
I don't want to drag him in formally, but on this parti-
cular thing. It would be - I would like very much to
get his reaction. But I want to try it.
Now, you can all sit around and argue with me, but
I want to try it.
MR. GAMBLE: I don't think you will know until you
try it.
H.M. JR: One try may not be enough. But don't for-
get there are twelve million Negroes in this country
who are not interested in this war and they are earning
a hell of a lot of money. And they are not interested
because they don't feel it is their war because they
are not permitted to go in the Army.
MR. SMITH: They get kicked around pretty viciously,
too, as far as that is concerned.
H.M.JR: Sure. There is something wrong, and you
said to me the other day, "Boss, we have to get something
new." All right, here is my first contribution. I just
want him to talk about - "Here I was, 8. little grocer,"
and 80 forth, "and I had my wife and my child, and this
is what happened to me. This is what this monster did to
me."
"Now, you people have got to fight to keep this thing that
from happening to you." And he will be a Christian
He says will be 8. Christian. And I want him to talk about
this thing, because there won't be any Jewish soldiers. his
church I hope it is a Catholic. I want him to say what
has happened - to him - can he go and listen to his church
and to his press - I want him to talk about what happened to be
to religion - about this anti-Christ. It has got an
intelligent person.
Regraded Unclassified
306
- 23 -
MRS. KLOTZ: A very high type.
H.M.JR: It has to be a university person. what has
happened to his home, his church, his religion, his freedom
of thought?
MRS. KLOTZ: In the flesh and blood.
MR. GAMBLE: It will need some careful picking.
H. JR: You try it for me, the sooner the better.
MR. GAMBLE: We won't give this to you, likely, for
about ten days, because we are leaving for these meetings
Thursday night.
H.M.JR: Don't wait too long.
MR. GAMBLE: I can have Fred do it in the meantime.
H.M.JR: Do you want to take it on, Fred?
MR. SMITH: Sure, if you want me to.
H.M.JR: Sure. My God, if this isn't public relations,
there is nothing in the world that is public relations.
And I don't want to have the whole thing, win or lose, on
one person.
MR. GAMBLE: No, I think if you get a good person,
Mr. Secretary, I think there are two things that you have
you will get in the plant, and what reaction you get out-
to find out. I think you have to find out what reaction
side the plant. I think that is important.
H.M.JR: That is right. I don't want to throw the
whole thing on one person. I would like to get three
persons.
MR. GAMBLE: I think you will need to get three in
order to get one.
Regraded Unclassified
307
- 24 -
H.H.JR: Most likely have to get a half dozen, but
Peter will be very helpful on this thing.
MR. GAMBLE: We will start it this afternoon, and I
will sit in with Fred.
H.W.JR: I really want to see this thing through.
MR. GAMBLE: I will get these slogans back to you.
Regraded Unclassified
308
Ted Gamble
April 19, 1944.
Fred Smith
Secretary Morgenthau
I think we will all admit that the Russians are
past masters at propaganda and if you'll note, during
the last six months they organized a group of Germans,
Anti-Nazi Germans, with a General in charge, whom I
think came from Stalingrad, and they have been using
them for propaganda purposes. The thought that I had
was, I know there are a lot of real Anti-Nazi prisoners
in America and that we take one of them as a try-out
and put him in a factory and let him address the men
on pay-roll deduction and if it works well, then we
can enlarge it. I wish you two men would think about
it and then talk to me. We need something new and
I'd like very much to see what a real Anti-Nazi could
do in addressing the workmen and tell them how he was
trained; how he was forced into the Army and all the
things that he knows and how he hates the Nazis; let
him give them a real Anti-Nazi talk. The Army knows
who are the Anti-Nazie and they have tested them.
Please think this thing over and talk to me promptly.
Examiting 11/19-
See Smiths memo 4/06/14-
Regraded Unclassified
309
April 19, 1944
3:35 p.m.
Re: CHARLES SCHOENEMAN
Present: Mr. D.W. Bell
Mr. C.S. Bell
Mrs. Klotz
H.M.JR: Explain this thing on Charles Schoeneman,
will you?
MR. D.W. BELL: Heretofore, the Administrative
Assistant has been the Budget Officer, and Mr. Schoeneman
has been the man who has really done the leg work, held
all the committee meetings, sat over before the Budget
while they have had the hearings of all the departments.
He has sat up before the Appropriation Committees,
before the hearings of all of the Bureaus. Now, this
would make him the Budget Officer. He would do the
same work, but it wouldn't pass through Charlie so
much.
Charlie thinks that is burdensome. He hasn't been
in on it so much. He will keep in touch with it, but
he wouldn't do the detail work Norman did on it.
MR. C.S. BELL: Norman never did so much on that.
Norman had the title of Budget Officer.
H.M.JR: I don't know what the office politics are,
but is this all right?
MR. D.W. BELL: I think that is 8 good arrangement.
MR. C.S. BELL: Everybody is happy.
Regraded Unclassified
310
- 2 -
H.M.JR: That is the point.
Don't give me a big speech, but does this make
Schoeneman happy?
MR. BELL: Yes, it makes the whole group happy.
(The Secretary approves appointment letter of
Charles Schoeneman)
Regraded Unclassified
311
April 19, 1944
3:40 p.m.
APPEARANCE BEFORE CONGRESSIONAL COMMITTEES
Present: Mr. Bell
Mr. White
Mr. O'Conneil
Mr. Smith
Mr. Luxford
Mr. Bernstein
H.M.JR: Well, this just happened to be handed me
(reads communication SB1258P-4/19): "Assistant U.S.
Attorney General Tom Clark held out the promise of &
'Moratorium' on restrictions of alcohol for beverage
purposes to the liquor industry but warned that 8. return
to prohibition is probable unless abuses in the industry
are corrected. Speaking at the Convention of the National
Alcoholic Beverage Control Association, Clark referred to
the fact that 'just as there are cycles in business, so
there are prohibition cycles.' Clark sharply criticized
the liquor industryfor 'widespread violation' of price
ceiling regulations, for false labeling, and for black
market operations."
Who is looking after liquor, officially?
MR. O'CONNELL: It is Suilivan's baby. I brought the
same thing in with me.
H.M.JR: Now, the purpose of this thing was to ask
Mr. O'Conneil - Joseph from Ireland--
MR. O'OONNELL: Not right from Ireland, but & little
ways back.
H.M.JR: Anyway, I was thinking of the McConnells
from Scotland.
MR. O'CONNELL: That is right.
H.M.JR: Wherever we were, what do you want about
Thursday and Friday? I hear you have put on spats and you
want to know who goes into Committee first, and 50 forth.
Regraded Unclassified
312
- 2 -
MR. O'CONNELL: As & Committee of Arrangements,
there are & couple of minor matters we should get clear
on. Dean Acheson wanted to know. The schedule calls for
& meeting in the Speaker's office at two tomorrow after-
noon, attended by the Chairmen of the House Committees,
Speaker Rayburn and probably McCormack, the Majority
Leader. The question as to that meeting is who, other
than you and Dean Acheson, are to go to that meeting?
Dean asked.
I told him offhand I thought, for that meeting and
the meeting at ten in the morning with the Chairmen of
the Senate Committees, that it wouldte on on a non-technical
basis and probably only you and Dean "cheson would go,
but I told him I would ask. The two o'clock meeting
in Rayburn's office.
H.M.JR: At two o'clock I would like Mr. Acheson,
Mr. White, Mr. Smith, and Mr. O'Connell.
MR. O'CONNELL: Do you want to permit Acheson to
bring anyone with him? He mentioned Collado and Pasvolsky.
I don't think that is necessary.
H.M.JR: I don't think it is necessary, either. I
am not going to bother you with this, Dan, unless you
want to go.
MR. BELL: I don't think 80.
H.M.JR: Then, I think, if it is White and Smith
and O'Connell - and I think just Acheson--
MR. O'CONNELL: Very well Then I also told him that
I thought if he would come by here & few minutes before
two, you and he would go down together.
H.M.JR: Is that agreeable to you, Mr. White?
MR. WHITE: I think we can arrange for that.
Regraded Unclassified
313
- 3 -
MR. O'CONNELL: That answers almost all the other
questions, then, because the next meeting is ten o'clock
in the morning with Senators Barkley, Connaily, and
Wagner, in Senator Barkley's office. And the same group
will be present then.
At ten-thirty in the Senate Banking Committee room,
before the three Senate Committees, the same group, I
assume. But Acheson will probably be justified in having
Collado and Pasvoisky with him at that meeting.
H.M.JR: Yes, and I think I can justify Bernstein
and Luxford.
Mic. WHITE: Right. If they go, certainly we could.
H.M.JR: It may be difficult, but certainly we could
do that.
All right, Luxford?
MR. LUXFORD: All right, sir. You will hear me if
I don't agree.
MR. O'CONNELL: That is really all, because the two
o'clock meeting in the House in the afternoon will be
the same group, of course.
MR. WHITE: Where do we have lunch? (Laughter)
You know, when we travel around, this is all arranged
ahead of time, Mr. Smith.
MR. SMITH: we have a press conference that we will
set up at four-thirty back here. You want to bring Acheson
back with you to that, don't you?
H.M.JR: Right. Not only do we arrange for lunch--
MR. WHITE: On the Hill, because no sense coming
down here.
Regraded Unclassified
314
- 4 -
H.M.JR: Sure, and the liquor has to be looked
after, and a place for me to lie down, and the rye
crisp.
MR. SMITH: That is O'Connell. He has charge of
everything on the Hill, including eats.
H.MJR: After all, he can't get dignified until he
is confirmed.
MR. O'CONNELL: That is right. And then I will
have trouble.
H.M.JR: You can get me my rye crisp up to the time
you are confirmed. Then you can tell me what to do with
it, after that.
MR. BELL: That ought to be simple, as long as he
doesn't leave off the crisp.
H.M.JR: Does that satisfy you?
MR. O'CONNELL: Yes, the press conference at four-
thirty. I take it in releasing a statement to the
people in the Executive Session in the morning and
afternoon, you will try to make it very clear to them
that they are not to release it or make any comment
with respect to it if they can avoid doing so, until
you have released it through the newspapers. And in
that connection I think I would stress the importance of
coordinating it with the British, really.
MR. WHITE: Yes, because the Dritish are making a
statement before the House of Parliament that they cannot
give them the documents until the following morning in
deference to the wishes of the American Congress.
It would be most unfortunate, in the light of that,
if they let it leak ahead of time.
H.M.JR: That would be Smith's fauit, after all.
Regraded Unclassified
315
- 5 -
MR. WHITE: It is Smith's responsibility. (Laughter)
H.M.JR: Well, then that is that? Who is going to
let Mr. Acheson know?
MR. O'CONNELL: 1 am.
H.M.JR: Now, what I was planning to do, and I would
like very frank replies - if Mr. White and Mr. Bernstein
would be free around six o'clock - have you any other
engagements tonight?
MR. WHITE: I haven't. I don't think it will be
necessary, but if you like I will be glad to be there.
H.M.JR: I think you will be happier. 1 think you
better be there, unless you had some date.
MR. WHITE: No, I have no date.
H.M.JR: I will feed you.
MR. WHITE: I have no date!
H.M.JR: Both of you.
MR. BERNSTEIN: Thank you, sir.
H.M.JR: I will "wine" you.
MR. WHITE: I have no date!
H.M.JR: And I will work with you until I fall
asleep. Having got to bed at three a.m. this morning--
MR. SMITH: Tell your wife you will be home at
seven! (Laughter)
MR. WHITE: If you are through with that, I have
a couple of rather important questions.
MR. O'CONNELL: There is one thing that I might
mention.
Regraded Unclassified
316
- 6 -
H.M.JR: The quicker I go home, the quicker I will
wake up.
MR. O'CONNELL: You see, 1 didn't talk with Rayburn
as recently as you did. lie called you back yesterday and
I understood from my talk with him and from yours, that
he was arranging with the Chairman of the Committees
both to meet with you tomorrow and to call the Executive
Session.
H.M.JR: Yes, but you better call up his secretary.
I don't know who he has.
MR. O'CONNELL: I did call his secretary and got
a confirmation to the effect that the meeting was in
his office at two, and at two the following day with
the Committees, and until this morning I had assumed that
Rayburn was handling it as Barkley did in the Senate.
But I talked to Congressman Bloom this morning and was 8
little embarrassed to find he hadn't heard until I talked
with him about either meeting, nor has his Committee been
informed.
H.M.JR: He has got somebody who is sort of a super
secretary up there. I don't know who.
MR. O'CONNELL: Who, Rayburn?
H.M.JR: Listen, fellow, it is up to you to get those
fellows there. By God, get them there if you have to go
around and see everyone. Now, if you have any daubts, you
better go up to Rayburn's office and sit there while they
call them. I have done it at the white House.
MR. O'CONNELL: Well, I think it is all right, but--
H.M.JR: Oh, oh. You had better go up there and find
out, or have your secretary cail up every one of these
people and find out whether they have heard.
MR. O'CONNELL: 1 would prefer to do that. I have
aiready informed Bloom.
Regraded Unclassified
317
- 7 -
H.M.JR: You bring a message to Garcia! Have you
read "A Message to Garcia"?
MR. WHITE: Put it in the mailbox.
H.M.JR: This is your assignment. I am counting on
you to see that the fellows are there. What Harry White
will do to you if they are not there is nobody's business!
MR. WHITE: And he isn't confirmed, see? I will
have a pull with one vote, I think!
H.M.JR: You had better do it with Barkiey's office,
too.
MR. O'CONNELL: I am all clear in the Senate. Every-
thing is fine.
H.M.JR: Will you go back as soon as you leave here
and make sure?
MR. O'CONNELL: Sure.
H.M.JR: Even last time, some did hear and some
didn't. It was all a mix-up. They didn't hear until
the last minute. Rayburn evidently is not a good
executive.
MR. O'CONNELL: My uncertainty came because I didn't
talk with Rayburn. You talked with him last.
H.M.JR: All he called me up about was my coming to
Texarkana and making & speech for Sam Rayburn. Do we
understand each other? I am not sharing the responsibility
with you.
MR. O'CONNELL: I understand you.
H.M.JR: There was no Garcia, Jr.
What else is there?
Regraded Unclassified
318
- 8 -
Joe, do you mind getting started on yours? You
don't mind my kidding you.
MR. O'CONNELL: No, indeed.
H.M.JR: Joe, 1 am counting on you. I am not worried
because you always deliver.
MR. WHITE: Before he goes - wouldn't he be the
appropriate one to handle the press release you want to
get from Bloom?
H.M.JR: I am not worrying about that. It is
Joe's responsibility. Let him decide.
(Mr. O'Connell leaves the conference)
MR. WHITE: Two questions - one is we haven't heard
from the Aussians. Is it possible to telephone Moscow?
Is there anything we can do? lias there never been a
telephone to Moscow?
H.M.JR: Not that I know of, no.
MR. WHITE: Then that is out.
H.M.JR: I don't know how to telephone Moscow.
MR. BELL: I don't eithen Shouldn't think you
could unless it went through German-occupied country.
MR. SMITH: The Ambassador must be able to get to
Moscow in a hurry if he has to.
H.M.JR: I will ask him.
MR. WHITE: More important - I have just had a dis-
cussion with Opie - is a question of calling the con-
ference. He stated that his Government--
H.M.JR: Why don't we do this at six o'clock?
Regraded Unclassified
319
- 9 -
MR. WHITE: Tonight? Yes, we could. I thought we
might get something started. If you can answer this
one question--
H.M.JR: Go ahead.
MR. WHITE: Do you need word from the President in
order to send any kind of & formal communication at this
date to the British Government telling them of the
conference, that the President would call it, and that
you--
H.M.JR: I can't.
MR. WHITE: You couldn't do that without the
President.
H.M.JR: No.
MR. WHITE: Then the task is--
H.M.JR: Expecially in view of last night's tele-
gram to the President.
MR. WHITE: Yes. Then what we do is to prepare
another telegram from you to the President. When will
he be back?
H.M.JR: I don't know. Harry, if you had something
like this, you should have let me know. I have to leave
here. I got to bed at three o'clock this morning. I
want to go home and get 8. little rest.
H.M.JR: All right. We will take it up tonight.
We may have a telegram drafted for your consideration.
H.M.JR: All right.
(Mr. White, Mr. O'Connell, Mr. Smith, Mr. Luxford,
and Mr. Bernstein leave the conference)
Regraded Unclassified
320
- 10 -
MR. BELL: The Federal Advisory Council, advising
the Federal Reserve System, put up a long memorandum
to the Board asking--
H.M.JR: I am all right, but Harry has so many
balls up in the air and the poor fellow can't tie them
together. He has this thing and he just--
MR. BELL: They want the Board to put up, along
with the Comptroller of Currency and the FDIC - all
the bank-examination authorities - to the Hershey Board,
a request to put the banking industry in an essential
classification, not a deferment of their employees, but
an essential, 80 they can compete on the same level with
the railroads and everybody else.
Ned Brown just called me and they said the Account-
ing Department over here in the Railroad Accounting
Department is taking our employees.
H.M.JR: You have sold me.
MR. BELL: I just want you to say yes. I recommend
that we go along with them; I think it is 8 good thing.
H.M.JR: All right.
Whatever happened to this one man they raised such
hell about, the First National of Boston?
MR. BELL: Lost him; turned down all the way along
the line. Just got a letter from Pope - or you did -
saying he had an idea that was going to be the result of
all of their appeals. He just wanted to let you know
that the Government security dealers were going to be
less effective 88 time went along.
H.M.JR: Well, we did everything we could.
MR. BELL: Yes. I heard nothing on the Debt hearings.
Should I make inquiry the first of the week after you get
through with this thing? Do you plan to go up?
Regraded Unclassified
321
- 11 -
H.M.JR: I don't know. Ask me tomorrow. The point
is this: I an leaving here sometime Friday night and
won't be back until Thursday morning. If I don't, they
will have a funeral around here.
MR. BELL: All right. Friday night you are leaving?
H.M.JR: Yes.
MR. BELL: Well, I could go ahead, I suppose, and
make arrangements.
H.M.JR: I wish you would carry it for me. If you
want me to go up, let me know.
MR. BELL: I would suggest if we could get out of
it, get out of it.
H.M.JR: All right. That is me.
MR. BELL: I think maybe if I go it might be simple;
I think if you go they might try to write the Republican
handbook for the Republican Campaign by asking you a lot
of questions.
H.M.JR: (Referring to call to Moscow) You can
speak from nine until eleven in the morning.
MR. BELL: Wonder why the restricted hours? From
nine to eleven - there is about seven hours' difference -
that is about four to six, isn't it, over there?
H.M.JR: Are you all right?
MR. BELL: That is all I want, yes.
Regraded Unclassified
322
THE WHITE HOUSE
WASHINGTON
19 April 1944
MEMORANDUM FOR:
The Secretary of the Treasury
The following message has just been re-
ceived in the White House Map Room for delivery
to the Secretary of the Treasury:
"FROM THE PRESIDENT FOR SECRE-
TARY MORGENTHAU.
"Referring to your telegram of
April 18, 1944, I heartily approve.
ROOSEVELT".
Respectfully,
CHESTER C. WOOD,
Captain, U. S. Navy,
Assistant Naval Aide to the President.
Revid. 4,18 P.M.
Regraded Unclassified
323
APR 1944
TELEGRAM FOR THE PRESIDENT FROM THE
SECRETARY OF THE TREASURY
I have made arrangements to appear before the appro-
priate Congressional committees on Friday, April 21, to
discuss the joint statement of technical experts of the
United Nations on the establishment of an International
Monetary Fund. The Treasury has planned the release of
the joint statement to the press at 8:00 p.m., April 21,
Washington time for Saturday morning papers, and it is
anticipated that the statement will be released in London
as well as possibly Moscow, Chungking, end some of the
American republics and British Dominions.
Although no final discussion can take place with the
British regarding the convening of an international
conference on the monetary fund and bank proposals this
spring pending discussion of the matter early next week
in the British Parliament, I propose to tell the Congres-
sional committees frankly of our desire to call such a con-
ference if circumstances permit. In this connection the
members of Congress are certain to ask questions regard-
ing the composition of the United States delegation and
particularly the participation of the Congress in the
conference. Secretary Bull and I would recommend that I
be authorized to state that you would probably appoint 8
delegation to be headed by the Secretary of the Treasury
and Including, among others, representatives of both
houses of Congress. We believe it very importent that a
statement be made of your intention thus to invite direct
Congressional participation in the work of the United
States delegation to the conference if it is convened.
We both believe that such a statement to the Congres-
sional committees will be of the greatest importance in
getting the proposed conference off to a good start with
Regraded Unclassified
324
- 2 -
the Congress and request accordingly that, if you approve,
you authorize me to make the suggested statement to the
members of Congress.
Secretary Hull approves this telegram.
is
HDW:gsa
4/18/44
Regraded Unclassified
325
<
April 19, 1944
4:25 p.m.
HMJr:
Hello.
Operator:
Secretary Hull has someone with him. I have Mr.
Brown.
HMJr:
Hello. Hello. Mr. Brown.
J. E.
Brown:
Yes, Mr. Secretary.
HMJr:
Are you familiar with the telegram I sent to the
President yesterday about how I should proceed
before the Congressional Committees?
B:
No. No, I am not, Mr. Secretary.
HMJr:
Oh.
B:
I -- I don't know who ....
HMJr:
Well, Mr. Acheson worked on it.
B:
Yes.
HMJr:
And it -- I got -- it went last night with Mr.
Hull's approval. Anyway....
B:
Uh huh.
HMJr:
....
I just got a message back from the President
in which he says he approves heartily.
B:
I see.
HMJr:
Would you give that both to Mr. Hull and to Mr.
Acheson?
B:
Yes, indeed, I'll be very glad to do that, Mr.
Secretary.
HMJr:
And if I might suggest, you might get a copy of
the telegram -- it's quite important -- that went
to the President.
B:
Yes.
HMJr:
And then just give it to Mr. Hull with this little
note on it that the President approved heartily.
326
- 2 -
B:
Approved heartily?
HMJr:
Yes.
B:
I'll do that, sir.
HMJr:
Right.
B:
Thank you very much.
Regraded Unclassified
327
April 19, 1944
4:53 p.m.
HMJr:
Hello.
Operator:
Dean Acheson.
HMJr:
Dean.
Dean
Acheson:
Yes, Henry.
HMJr:
Can you stand a little good news?
A:
Well, I thought that was fine. I just heard
it from Harry.
HMJr:
Oh - Oh. Did Harry call you?
A:
He's just -- I just hung up the receiver.
HMJr:
Oh, I wanted the pleasure of telling you myself.
A:
(Laughs) Well, I am delighted to hear about it.
I think it's very fine news.
HMJr:
Yeah.
A:
I'll tell the Secretary right away. The Boss
said he concurred?
HMJr:
He said, "Approve heartily."
A:
Oh, well, that's very fine.
HMJr:
I've turned the words around but....
A:
Yeah.
HMJr:
that's -- "Referring to your telegram.... II
and .... BO forth -- a little paraphrasing --
"approve heartily."
A:
Yes. Well, that's ....
HMJr:
Those are the actual words that he uses --
"approve heartily."
A:
Well, that's very good.
HMJr:
And that ought to make everybody's job easier.
Regraded Unclassified
328
- 2 -
A:
I should think it would make it a lot easier.
HMJr:
And my policy of "nothing ventured, nothing
gained" bore a little fruit, but I think that
that ought to help on the whole thing between
Mr. Roosevelt and Congress.
A:
Yes, I think it will help a great deal.
HMJr:
Well, thanks 80 much for your collaboration.
A:
Well, I always give it when I can, Henry.
HMJr:
Thank you very much. Good bye.
A:
All right.
329
April 19, 1944
MEMORANDUM FOR THE SECRETARY
Subject: Ways and Means Committee meeting
(For your information - No action
required).
The Ways and Meane Committee met Tuesday, April 18,
at 10:00 A. M.
1. Congressman Dewey brought up the action whether
under a recent tax court decision expenses of Congress-
men are deductible. Mr. Stam WEE asked to look into the
implications of the decision. (In my opinion it would
be easier to secure income tax legislation if Washington
expenses of Congressmen were allowed as deductions, but
this is not the present rule).
2. Mr. Stam showed the Committee the new Form 990
for tax-exempt organizations. The Committee took no
formal action but there was no objection to going ahead
with the form. Mr. Stam had previously made a few minor
suggestions.
3. The reading of the tax simplification bill was
begun. Mr. Knutson raised the question whether the
instructions of the Committee had been followed with
respect to tax rates in the higher brackets. After a
long and largely fruitless discussion, it was decided to
have the Joint Committee Staff and Treasury staff see 1f
a closer "fit" to present law can be achieved in the rate
structure of the simplification bill. This was done
yesterday afternoon with not too satisfactory results.
The Ways and Means Committee 16 scheduled to meet
again Wednesday morning, April 19, at 10:00 A. M.
RoyBlough
Regraded Unclassified
330
MEMORANDUM
April 19, 1944.
FOR YOUR INFORMATION
TO:
The Secretary
JTS
FROM:
Mr. Sullivan
General Browning called today and said he thought the
best prospects for the top job in the disposal of war surplus by
Treasury Procurement were, in the following order:
Ernest L. Olrich
Walter G. Baumhogger
R. S. Stevens
Fred A. Bants
Standish T. Donogh
I am attaching hereto his notes on these five men.
He also stated that other persons who might be considered
for the top job are Captain William Best and Captain Neuber, both of
Bureau of Supplies and Accounts of the regular Navy. He described
Best as an excellent administrator and organizer and a person who
handled people remarkably well. He stated that Captain Neuber also
had these qualifications.
He referred to C. D. Ryan, President of Montgomery Ward
and their General Merchandising Manager for four years as a person
who knew the manufacturing end very well and a good man to consider
except for the present position of the company on the labor front.
I an also attaching a copy of the list you gave General
Browning.
He describes Colonel Doyle as an individualist who finds
it difficult to work with others. He states that Folsom referred
to him as an "ordinary second rate". He said that Colonel LaDue
was too antagonistic. He stated that Private Bramson was the
Basement Manager of the May Company in Los Angeles and too inex-
perienced for the top job. He said that Major Kribben was primarily
an accountant and was probably unavailable. He thought that
Mr. Riley was "over the hill". His personal habits are responsible
for his probable imminent diamissal from his present position.
Regraded Unclassified
331
14 April 1944
ERNEST L. OLRICH
AGE: 54
CIVILIAN EXPERIENCE:
Munsingwear, Inc., Minneapolis, Minnesota
6 years
President - Manufacture and distribution of
knit goods products
Marshal Field & Co., Chicago, Illinois
5 years
Controller
Fred Harvey, Inc., Kansas City
7 years
Controller. Operated and managed chain
of restaurants.
Textile Business, New York City
Several Years
Regraded Unclassified
332
17 April 1944
WALTER G. BAUMHOGGER
AGE: 48
CIVILIAN EXPERIENCE:
United Cigar - Whelan Store, New York City
4 years
President and General Manager
Certain Teed Products Co., New York City
1 year
President
Montgomery Ward & Co., Chicago, Illinois
20 years
Vice President - Manager of all operations
in the Eastern Region. Previously General
Merchandise Manager
OTHER EXPERIENCE:
During the past three years has worked for the
War Department in connection with Army Exchange
Service and Quartermaster activities.
Regraded Unclassified
333
17 April 1944
R. S. STEVENS
AGE: 43
CIVILIAN EXPERIENCE:
Montgomery Ward and Company, Chicago, Illinois
18 - 20 years
since November 1943 Vice President and General
Merchandise Manager of the Company. Previously
Divisional Merchandise Manager of all hard
lines. Prior to that, Buyer and Merchandiser
of hardware, plumbing, building materials, farm
equipment, tires, automobile equipment and
accessories and paints.
OTHER EXPERIENCE:
At various times in the past three years has
worked for WPB, War Department and Navy Depart-
ment on loan from Montgomery Ward.
Regraded Unclassified
334
14 April 1944
FRED A. BANTZ
AGE: About 45
CIVILIAN EXPERIENCE:
J. C. Penney, New York City
20 years
Divisional Merchandise Manager of work
clothing, sweaters, shirts, underwear,
hosiery, gloves, leather jackets and
kindred lines
335
14 April 1944
STANDISH W. DONOGH
Commander
Supplies and Accounts
AGE: 40
CIVILIAN EXPERIENCE:
Interstate Department Stores, New York City
2 years
Divisional Merchandise Manager - Men's and
boys' clothing and furnishings.
Montgomery Ward & Co., New York City
4 years
Divisional Manager of men's furnishings
Olds, Wortman & King, Portland, Oregon
8 years
General Manager of the entire store.
Previously Merchandise Manager and Buyer
MILITARY EXPERIENCE:
Navy Department, Washington, D. C.
1942 to date
In charge of procurement of officers'
uniforms.
Regraded Unclassified
336
Colonel Robert A. Doyle. Formerly president of Orange Crush Company;
formerly president of McCreary Stores; formerly with Lord end Taylor.
Recently in the office of the Chief of Staff and a close personal friend
of General Marshall. He is about 50. According to Lindsay Bradford,
President of the Armers Loan and Trust Company, he is very able, very
successful, a high grade executive. He is the kind of man that Bradford
would like to make his executive vice-president. He was released from
active service on March 11. His address is 318 West Superior Street,
Chicago. His earning power is $75,000 a year. He is attracted by the
chillenge of a tough job. He could be recalled to duty and reassigned.
Colonel John La Due. Stationed at Governor's Island. Formerly president
of John David Stores. Salary about $50,000.
Private Edward Bramson. 38 years old. Salary, $40,000. Formerly manager
of May Company of Los Angeles. One of the exceptionally able young men in
merchandising. Probably now peeling potatoes in Army camp in California.
Major Earl Kribben. 40-42 yrs. Formerly treasurer of Marshall Field.
Now in Renegotiation Section of the War Department.
In civil life:
Walter Baumhogger. President of United Whelan; formerly Vice president
of Montgomery Ward; about 45 yrs.; $75,000. Outstanding organizer;
driver. He can be challenged by a tough job.
Phil Riley. Director of Retail Research Assocation. About 58 yrs.
Retiring in July. Good organizer. Salary, $50,000. He was a colonel
in the Personnel Division during the last war. He is a top merchandising
man, well acquainted with markets.
Regraded Unclassified
Why no date ?
337'
4/19/44
For your information
MEMORANDUM FOR THE SECRETARY
Re: Argentina
On April 1 the Central Bank of Argentina advised the
Federal Reserve Bank of New York that it desired to ship
approximately $7,000,000 of Argentine owned gold to Switzerland
via Portugal, in order to make payment of Swiss francs
30,000,000 of Treasury bills issued in Switzerland by the
Argentine Government. On April 3 the Federal Reserve Bank
of New York advised the Central Bank of Argentina, at our
request, and after the matter had been cleared with State,
that the proposed gold shipment would require a freezing
control license and that the issuance of such a license would
be contrary to the policy of this Government.
On April 10 the attention of Foreign Funds Control was
drawn to Armour's cable No. 921 of April 5 reporting that he
understood the Central Bank planned to ship from Argentina six
tons of gold by air if possible, or otherwise by boat to
Switzerland via Lisbon due to the inability to effect the
shipment from New York. This proposal was discussed by Messrs.
White, Bernstein, Luxford and Fox and it was agreed we should
take informal steps with the object of having State inform the
British not only of our interest in the matter but also urging
that the navicert not be granted, at least until the matter had
been discussed with this Government by the British Government.
Accordingly, Luxford discussed the matter with Collado.
Collado at first questioned this policy, pointing out that the
British ship gold to Portugal for Swiss account. Luxford
reminded him that there W8.8 some degree of difference between
one of our Allies shipping gold in furtherance of our mutual
war effort and allowing Fascist Argentina to ship it to
"neutral" Switzerland. Collado accepted this distinction.
He then indi cated that he would endeavor to arrange to have
State advise the British of this Government's concern about
the proposed gold shipment and request that no navicert be
granted in connection therewith, at least pending further
Regraded Unclassified
338
- 2 -
discussion of the matter with this Government. Fox followed
up the matter along the same lines with Swihart at 2:00 p.m.
April 11. Swihart indicated that he was in sympathy with the
Treasury proposal, that he would endeavor to clear the matter
in State, and that he would keep the Treasury promptly advised
of developments in connection with the representations to the
British.
On April 12 Collado called Luxford and advised him that
after discussing the matter with Acheson, Swihart had been
instructed to inform the British of our interest and to request
that no navicert be granted without further discussion with the
Government. Collado also assured Luxford that Treasury would
be consulted if there are any further developments.
Regraded Unclassified
Treasury Department
338 -A
Division of Monetary Research
Date
19
To:
Miss Chauncey
Returned, as per our conversation.
L. Shanahan
MR. WHITE
Branch 2058 - Room 214-1/2
Regraded Unclassified
338-B
Dr. White:
The Secretary asks if there is
anything he should do about this.
nme
338-C
DEPARTMENT OF STATE
Memorandum of Conversation
DATE:
April 19, 1944.
SUBJECT:
BRITISH OVERSEAS FINANCIAL POSITION
PARTICIPANTS: Sir John Anderson, Chancellor of the Exchequer
Mr. Edward R. Stettinius, Jr., Under Secretary of State
COPIES TO:
The Secretary of State
The Secretary of the Treasury
The Foreign Economic Administrator
... 1-148
1) Sir John Anderson stated that in spite of the ensurance
volume of Lend-Lease assistance, the British overseas financial
position has continued to deteriorate throughout the war. He
gave me the following annual figures on the loss of British-over-
seas assets and increase of overseas liabilities;
1940
$3,024,000,000
1941
3,188,000,000
1942
2,540,000,000
1943
2,620,000,000
He stated that the estimate for 1944 is $2,800,000,000.
Sir John Anderson stated that from 1939 to the end of 1944 the
aggregate British loss of overseas assets and increase in overseas
liabilities will exceed 15 billion dollars. Part of this, of course,
has been not by the outright sale of assets. It is probable, how-
ever, that the external liabilities of the United Kingdom at the
end of 1944 will be in the neighborhood of 12 billion dollars. (The
British have parted outright with more than 3 billion dollars since
the beginning of the war, Anderson explained, but they entered the
war with certain external liabilities against which their reserves
at that time were held.)
Regraded Unclassified
338 - D
-2-
2) From the middle of 1941, when British gold and dollar
balances were almost exhausted, they had built up balances in
the amount of 1.3 billion dollars by the end of 1943. Sir John
Anderson estimates that by the end of 1944 these balances will
have risen to 1.6 billion dollars, or about one-seventh of the
probable British liabilities at that date.
Sir John Anderson emphasized that these gold and dollar bal-
ances represent the United Kingdom's only quick assets against
their external liabilities and that they are in fact the central
reserves of the whole sterling area. He pointed out that the
British are under certain obligations to furnish dollars from
these balances when they are needed by the other members of the
sterling area.
3) Sir John Anderson stated that the improvement in Britain's
dollar balance during 1944 would be almost entirely due to the
large expenditures of United States troops within the Empire. In
1944, the British expect to receive $585,000,000 from this source
in the United Kingdom and $475,000,000 in the rest of the sterling
area, making a total of over a billion dollars. As a result of
the recent reductions in Lond-Lease and the increases in Reverse
Lend-Lease, however, it is estimated that the not increase in the
British gold and dollar balances will be only $300,000,000.
4) The element in this situation which is most disturbing,
Sir John Anderson stated, is the fact that the receipts from United
States troops, particularly those in the British Isles, constitute
only a temporary source of income. The British fear that after
the end of hostilities in Europe their balances will fall through-
out the period of the Pacific war, even if Lend-Lease is maintained
at its present level. A further diminution in the volume of Lend-
Lease after the end of the war in Europe, Anderson stated, would
mean that British balances would fall rapidly during the Japanese
war while their external liabilities continue to grow.
5) 8ir John Anderson estimates that by the end of 1945 or
shortly thereafter, British gold and dollar reserves will be down
to about one billion dollars and their overseas liabilities will
have risen to about 15 billion, which will mean that the ratio of
quick assets to external liabilities will have fallen from one-
seventh at the end of 1944 to one-fifteenth at the end of 1945.
6) Sir John Anderson asked me about American opinion on this
problem. I explained that when the "farmer from Kansas" learns
that the British had 3 billion dollars in 1939, that they have re-
ceived 10 billion or more of goods under Lend-Lease, and that they
Regraded Unclassified
338 - E
-3-
are beginning to accumulate gold and dollars again, he is going
to think that the British must now be very rich. Anderson pointed
out that, of course, assets without reference to liabilities are
meaningless. "As I have told you," he stated, "we will probably
come out of this war with debts of fifteen billion dollars and
assets of only one billion."
Regraded Unclassified
April 19, 1944
TO: Secretary Morge mau
339
FROM: J. W. Pehle.
Following our conversation on the
press conference yesterday, you will be
interested in the attached memorandum
prepared by Mrs. Mannon. Her statements
are accurate.
JUST
340
TREASURY DEPARTMENT
INTER OFFICE COMMUNICATION
DATE
April 19, 1944
TO
Mr. Pehle
FROM Virginia Mannon
This is the way I remember the part of your press conference yesterday
during which the question of bringing refugees into this country came up.
Al Gregory of UP asked if any consideration had been given to
bringing more people into this country. You replied that it was being
talked about and cited as an example Samuel Grafton's two recent columns
in which he had initiated the idea of "free ports" for refugees. Someone
else then asked if the Board were considering that idea, You replied that
all sorts of things were under consideration, but you could not talk about
them at this time, You did not say that the Board was considering "free
ports,"
At 1 a.m. today the United Press called me. The man on the night desk
said the New York papers were carrying a story on the press conference in
which you had come out for "free ports" for refugees. He wanted to know if
it were correct. I told him the above and added that their Mr. Gregory had
covered the conference and said that if he had omitted mention of "free ports",
he was keeping the subject in the perspective in which it had appeared in the
conference.
This morning Mr. Gregory came in to see me and said his office had
called him twice about the matter after 2 a.m, He told them that he had
not taken that line because you had not said the Board was considering
"free ports." He asked if he could see you to corroborate his stand to
clear himself with his New York office.
Later this morning Muriel Levin of the Jewish Telegraphic Agency
telephoned and asked what we thought of the way the New York papers had
handled the subject. She said she was in a box because she had not men-
tioned "free ports" in her story and her New York office was demanding
a follow-up. She wanted a statement from you. I told her I was sure you
had nothing more to say and that it would be better to leave well enough
alone. She agreed to telephone her New York office and urge it to drop
the subject.
Both Mr. Gregory and Miss Ievin talked about how difficult it was to
be right when you were outnumbered by those who were wrong.
Regraded Unclassified
341
SYCTORY
EXECUTIVE OFFICE OF THE PRESIDENT
BUY
-
STATES
WAR
WAR REFUGEE BOARD
some
I
WASHINGTON 25, D. C.
OFFICE OF THE
EXECUTIVE DIRECTOR
MEMORANDUM
April 19, 1944
TO: Secretary Morgenthau
FROM: Mr. Pehle
Before your discussion with Secretary Hull regarding
the Vittel camp cable and before the April 8 "blast of the
State Department", the Board was experiencing great dif-
ficulty in getting its cables cleared and transmitted by
the State Department. In fact, you recall that the Vittel
camp cable was sent to the State Department on February 21,
1944, 8 draft in substitution for such cable was delivered
on March 16, and the latter was transmitted only on April 7.
Many ofour cables have required three weeks to clear and
even some cables merely informative of action taken by the
Board were delayed for more than two weeks. If an
important cable cleared within 8 week, it was record time.
However, after your discussion with Mr. Hull and the
"blast", the situation changed materially. All Board
cables since that time have been transmitted within two
or three days and several important cables have been
transmitted the same day on which they were delivered to
the State Department. In fact, Monday evening around
six o'clock we delivered an important cable to the State
Department and asked that it be transmitted immediately.
To our surprise State promptly complied with our request
even though it meant that the Department had to depart
from its regular routine on this matter and keep some
employees after hours in order to despatch the communica-
tion in question. There is no question but that the
situation has greatly changed for the better. of course,
we can't say how long this happy state of affairs will
continue.
JUFFICE
Regraded Unclassified
342
envelope taken to:
Mr. Latta's office
(Johe sent by Pouch)
by S.S. agent 4/20/44
Regraded Unclassified
343
April 19, 1944
My dear Mr. President:
I don't know whether you get the daily
New York papers. I am, therefore, sending you
herewith a very interesting clipping from the
front page of today's New York Tribune.
I had lunch with Mr. Hirschmann today,
and he really accomplished wonders while in
Turkey.
Sincerely yours,
(Signed) Henry Morgenthau, Jr.
The President,
The White House.
Regraded Unclassified
344
NEW
YORK
Herald
Tribune
APR 1 9 1944
Free U.S. Ports
all possible ways of finding tem-
porary havens for refugees, be
said, under conditions which were
deplorable and to
explained.
ToAidRefugees
describe.
Mr. Hirschmann, whose account
"The whole principle of taking
of his experiences in Turkey OC-
human beings and putting them
Are Considered
cupled most of the press confer-
in one place not fit for human
ence, said that President Roosevelt
life, and having that accepted as
is regarded as "a god" in occupied
routine without protest, without
War Refugee Board Studies
Europe because of his efforts on
an attempt by civilized people to
behalf of oppressed peoples.
rescue them, is one that has to
Setting Up Places Where
"There may be some people in
be challenged, apart from the
They CouldAwait Rescue
misery of the people themselves,"
this country who don't like him,"
he said.
said Mr. Hirschmann, "but that
Just as arrangements had been
From the Herald Tribune Buresu
is not true in Europe. He is a god
completed to move the 48,000 into
WASHINGTON. April 18.-The
there. They can't believe there
the interior, the Russians moved
War Refugee Board is considering.
is any opposition to him. He is in
into the Transdniestria, and trans-
among other proposals, A plan to
their eyes a savior."
portatich lines were choked as a
establish free ports of temporary
Mr. Hirschmann said Mr. Roose-
result. The movement of the
residence in the United States for
velt's declaration of March 24, in
refugees was "not expedited. to
refugees from Nazi Europe, it was
say the least," Mr. Hirschmann
which he called on the free peo-
disclosed today by John W. Pehle,
said, but it did get under way. with
ples of Europe and Asia "tempo-
assistance of the Romanian gov-
executive director of the board.
rarily to open their frontiers to all
ernment.
Mr. Pehle was asked about the
victims of oppression," had had an
Mr. Hirschmann said the Rus-
free port plan at a joint press
"electrifying effect" in the Bal-
sians were also very co-operative,
conference with Ira Hirschmann,
kans. It was broadcast over and
and be paid high praise to Lau-
of New York, vice-president of
over again, and It gave people hope
rence Steinhardt, American Am-
Bloomingdale Bros., Inc., and spe-
bassador to Turkey. Mr. Stein-
because it made them feel some
cial representative of the W. R. B.
hardt "not only backed me up.
one was coming to help them, he
in Europe. Mr. Hirschmann re-
he plunged into the work." said
said.
Mr. Hirschmann. "I think this
turned to Washington yesterday
Mr. Mehle added that
Mr. Roose-
board and the President and the
from Turkey, where he had been
velt's declaration had
in
impor-
people of this country who are
since Feb. 14.
tant effect in overcoming the dis-
interested in human beings wher-
The purpose of refugee free
couragement of some refugees who
ever they are should be very
ports would be to provide a place
had given up trying to get out of
grateful for having Mr. Steinhardt
in the United States where refu-
the Nazi grip and decided that
in Turkey at this time."
gees who had no other place to go
since their case was hopeless they
The War Refugee Board has
could wait in safety until it be-
might just as well die where they
been negotiating with the Turkish
were. With the Roosevelt encour-
came possible for them either to
government to charter the S. S.
agement these people made a new
return to their homes or to settle
Tari to carry 1,500 refugees to
effort, he said, adding that It is
Halfa. Everything has been ar-
elsewhere. While in a free port, essential that they keep trying to
ranged, except a safe conduct
the refugees would not be per- help themselves.
from the Germans, and It is hoped
mitted to travel to other parts of Mr. Hirschmann said the War
that the ship will sail any day, he
the United States unless they were Refugee Board had been Instru-
said. In the last few weeks three
legally admitted through the regu-
mental in moving refugees from a
small Bulgarian boats brought 250
lar immigration procedure.
camp in Transdniestria, the Ro-
refugees each to Istanbul from
Mr. Pehle said he could not say
manian orbderland now held by
Constanza, in Romani.. The usual
how far consideration of the free-
the Russians, into the interior of
route from Istanbul
Palestine
port plan had gone and that no
Romania, whence they may hope
is overland.
decision had been made or action
to get out through Turkey,
taken so far. It is the duty
There were 48,000 people, mostly
Jewish. crowded into the
vrans-
the War Refugee Board to study
iniestria camp, Mr. Hirschmann
Regraded Unclassified
345
EMERGENCY
COMMITTEE
TO SAVE THE JEWISH PEOPLE OF EUROPE
INITIATED BY THE EMERGENCY CONFERENCE HELD IN NEW YORK-
JULY 20-26, 1943
2317 - 15th STREET, N. W., WASHINGTON 9, D. C.
ADams 0840
April 19, 1944
Dear Mr. DuBois,
I am sending you & short memorandum on a group
of five hundred evacuees from Slovakia who are now
stuck in southern Italy, and also a copy of = letter
from their spokesman to myself.
Their problem is to get immigration certificates
to Palestine. I do not know whether this is a case
for the War Refugee Board. It is my impression that
at best it would be A marginal case. However, I
thought that it was just the kind of a problem that
the Intergovernmental Committee on Refugees could
tackle.
Do you think you could do anything in the mat-
ter, either yourself or by recommending it to the
attention of the Intergovernmental Committee?
By the way, I notice in Mr. Czitrom's letter
that there are now only four hundred. I know that
some of the original five hundred have died. What
happened to the others who are missing I don't know.
Thanking you, I am
Sincerely yours,
/8/ Eri Jabotinsky
Eri Jabotinsky
Enclosures
Mr. Josiah E. DuBois,
War Refugee Board,
Treasury Building,
Washington, D. C.
Regraded Unclassified
346
MEMORANDUM ON THE 500 CASTAWAYS AT VERRAMONTI
Allied troops occupying southern Italy took over a carrp located
at Ferramonti-Tersia in the Province of Sosenza. In that camp they
found over & thousand internees of which 500 were Jews who had been
ship-wrecked near Rhodes in the summer of 1940 on their way to
Palestine.
These 500 originally came from Slovakia, They got organized in
1939 and were preparing to make their way to Palestine. A French ship
was to take them from a Yugoslavian port and land them on the Pales-
tine beach. At the outbreak of the war, however, the Fronch Govern-
ment ordered all its ships confined to their ports, and the 500, who
were ready to start on their voyage and who had alrendy paid the ship
owners for the charter of the ship, remained stranded in German-
dominated Slovakia, already at war with France and Great Britain.
Early in 1940 a small ship was provided for them in Rumania.
It was a Danubian paddle boat of Italian registry which was over-
hauled and made seaworthy according to the standards of the Rumanian
Maritime Commission. It was given Bulgarian registry and renamed
the S.S. PENCHO. In the spring of 1940 the boat went up to Bratialava,
took on board the 500, and paddled with them down the Danube, through
the Black Sea and the Straits into the Aegan and the Mediterranean.
An unfortunate boiler explosion occurred off Rhodes and it is
understood that one of the paddle wheels came off. Italy was already
at war with Great Britain and the 500 were naturally very worried as
to their fate. Four of them left in a row boat and made in the
general direction of Crete where they hoped to make contact with the
British, They were sighted by a plane after several days of rowing
and were later picked up by a destroyer which was part of a large
formation of British warships. They witnessed a maval battle and
were brought by the destroyer to Alexandria, and owing to their
indeterminate status they were detained there and later transferred
as "sick" to the local Jewish hospital where they may still be re-
siding.
Those who remained on the PENCHO were picked up by the Italians
and interned on Rhodes and later transferred to Ferramonti.
For three years, until the Allied occupation, they lived under
very bad conditions. It is understood that about twenty of them died.
Until the entry of America into the war the Joint Distribution
Committee was able to provide them with some measure of comfort, of
which they were later deprived.
When taken over by the Allies they were found to be in fairly
good moral condition. Their camp was clean and well organized, they
had schools And social functions. They had also organized the part
of the camp to which the Italians assigned several hundred other Jewish
refugees brought in from various places.
Their problem today is to reach Palestine,
Washington, April 17, 1944,
Regraded Unclassified
347
COPY
Ferramonti, 24th February 1944.
Emergency Committee to Save Jewish People
of Europe,
c/o Eri Jabotinsky
2317 - 15th Street, N. V.
Washington, D. C.
Dear Eri,
With greatest pleasure I got your message through the
American Red Cross and I hurry to answer your questions. More
than 400 persons of the Pentcho group are still here. Our aim
remains the same: reach Palestine as soon as possible. We ap-
pealed to all competent institutions to assure certificates and
transport possibilities. Our situation asks for quick departure.
There are more than 6 months that the Allies delivered our
camp. Nevertheless nothing positive was done until now in the
interest of the Palestine Immigrants. We beg you to intervene
at all institutions in question, so that we might get the certifi-
cates promised by the Jewish Agency and the transport possibility
from here to Palestine,
Until now we did not succeed in finding the direct connec-
tion with the Joint. We need this connection firstly because
the ex-internees get 15 Lit; daily and cannot live upon it and
secondly because after 4 years of suffering and internment our
underwear and clothes are worn out and we could not afford other
ones. The majority of the internees are without any means. We
beg here to remark that in spite of several promises by the dif-
ferent institutions we did not get any financial help. After
the arrival of our group in Polestine a considerable help will
be necessary.
I cannot lay enough stress upon the fact that our stay in
this malaria territory is unbearable. Our deliverance came and
we want to re-enter normal life. Therefore I beg you to under-
take whatever you can to bring & solution into our affair.
Please inform us of your interventions. With our heartiest
thanks in advance and best Zionist greetings,
Yours,
(Signed) À, Czitrom
(Above letter sent by Alexander Csitrom, ex-Internment Camp.
Ferramonti, Prov. Cosenza, Italy, through the American Red Cross.
Regraded Unclassified
348
- 2 -
The American Red Cross adds:
"You may be interested to know that in the accompanying
letter from our special representative in Italy it is
stated that the 'camp in which Mr. Czitrom was located
has been moved to a better area and much more assistance
given to all the people interned there. We are sure that
the conditions under which they are now living are better
than those that existed at the end of February."
Regraded Unclassified
349
CABLE TO LONDON
Reference your No. 2696 of April 3, 1944, concerning
relief of refugees in Rome.
War Refugee Board has been advised by represent>tives
of American Jewish Joint Distribution Committee in Portugal that
1
1,400,000 lire have already been borrowed in Rome against the
$20,000 credit established in London.
War Refugee Board is discussing with Apostolic Delegate
in Washington possibility of making future remittance for this
program direct from United States through Vaticen channels.
American Jewish Joint Distribution Committee is prepared to make
further sums svailable for this relief work but will weit outcome
of aforementioned discussions.
April 19, 1944
4:30 p.m.
Attachment
FH:lab 4/14/44
Regraded Unclassified
350
DSH
Department
PLAIN
PLAIN
April 19, 1944
AMEMBASSY,
LONDON.
3131 Nineteenth
FOR KULLMANN FROM EMERSON.
Please cable text of British Foreign Office or American
Embassy letter asking Intergovernmental Committee to take
responsibility for ultimate disposition of occupants of
North African camp.
HULL
(GLW)
WRB:GLW:KG
4/19/44
BC
Regraded Unclassified
351
TELEGRAM SENT
PLAIN
April 19, 1944
AMEMBASSY,
LONDON.
3132, nineteenth
FOR THE AMBASSADOR
Refer your 3153 April 18 and your despatches 14742 March 29
and 14853 April 4. Rules of procedure and regulations relating
to receipts and expenditures of Intergovernmental Committee are
approved with the following exceptions to the rules.
1. For the last sentence of Article VII subarticle one of
the rules substitute the following QUOTE When a vacancy occurs
the Executive Committee may cake an appointment which shell be
subject to the confirmation of the Plenary Committee, but pending
such confirmation the person appointed may assume the duties and
powers prescribed for the office of Dir ector under these rules UNQUOTE.
2. In the view of this Government subarticle 2 of Article VII
should be omitted. A term of office fixed at three years may
encourage some member governments to seek a change in the office
of the Chief Executive Officer at the end of each period. On the
other hand there should be a contract between the Executive Com-
mittee and the Director which will provide inter alia that notice
of termination of six months can be given by either party.
3. For the first five lines of Article VII subarticle 6 sub-
stitute the following QUOTE Within the budget provisions the
Executive Committee shall appoint the Vice Director, or Vice
Directors, the Secretary and also 5. Treasurer if, and when
required; the Director shall appoint such other officers and
staff as he shall find necessary, and shall prescribe the con-
ditions of pay and service, providing that the Executive Committee
may require that it be consulted in regard to appointments to,
removals from, end conditions of pay end service of particular
offices UNQUOTE.
These suggestions have been approved by Myron Taylor and
Emerson.
HULL
(GLW)
WEB:GIW:KG
BC
EUR
Mr. Pell
for
Mr. Taylor
Regraded Unclassified
352
RMN-424
PLAIN
London
Dated
April 19, 1944
Rec'd
11:59 p.m.
Secretary of State
Washington.
3224, nineteenth.
Following letter dated April 15 has been received
from Foreign Office referring to letter communicated
in Embassy's 2696, third: "With reference to my letter
of the 30th March about assistance for Jews in Rome
we received a cheque for 4,968 pounds eighteen shillings
tenpence on the 8th March, and I note that in your
letter of the twenty-seventh March you state that the
American Joint Distribution Committee 18 arranging for
twenty thousand dollars to be held with bank in London
in its name.
We have since heard from our Minister in the
Vatican City that the money should be deposited to the
account of Delasem (Delegazione Assistenza Emigranti)
Rome branch and that this the organization that ad-
ministers assistance to Jews in several of the Chief
towns of Italy. Delasem asks that the credit which we
are holding should be credited in their name in the
United States in dollars, together with further credit
asked for and I hope that you will be able to arrange
for their wishes to be carried outl In that event we
will return to you the amount of 4,968 pounds eighteen
shillings and tenpence which we hold". Please inform
War Refugee Board.
WINANT
HTM
Regraded Unclassified
353
TELEGRAM SENT
GNY
PLAIN
April 19, 1944.
AMLEGATION,
LISBON
1086
Following for Dexter from J.W.Pehle, War Refugee Board.
WRB no. 3.
Reference your 1053, April 10. Glad to hear of designation
and acceptance. Arrangements being made here for Legation to sup-
ply administrative needs and administrative expenditures through
State Department channels. Attempting to make arrangements for
automobile and typewriters and will advise you further. Agreeable
to purchase of safe if Legation unable to accommodate. Establish-
ing $10,000 credit for which you will be responsible to me alone.
These funds not subject to usual government disbursing requirements
but you should keep careful record and obtain receipts where pos-
sible. These funds may be used at your diseretion but should not
(repeat not) be used for administrative expenses of the sert being
handled by the Legation. We are contacting Eleanor Widen re
availability. Compensation for loss of time to Unitarian Committee
being a rranged with Jay.
$
HULL
(GLW)
WRB: GLW: KG
WE
FA
A-S/3
4/19/44
Regraded Unclassified
354
Lisbon
CM - 278
This telegram must be
paraphrased before being
Dated April 19, 1944
communicated to anyone
other than a Government
Rec'd 6:18 p.m.
agency. (scoo)
Secretary of State,
Washington.
1168, April 19, 11 p.m., (SECTION ONE)
WRB number one.
Special instructions regarding granting of visas to refugee children noted.
Instructions have been sent to consular offices under this Legation. In view of
difficulties in getting children out it is doubtful if any large number will be
available before July 1, 1944. Department's 1017 April 12.
Legation has advised Portuguese Government of arrangements made and has re-
quested it to grant necessary transit visas and hospitality; also that arrangements
for financing children in Portugal will be undertaken by War Refugee Board. Will
advise later reactions.
We are in contact with Isaac Weissman regarding plans for reception centers.
See Department's telegram 1048, April 15. Extensive plans not necessary now but
may be later. Will keep you advised of developments. Think reception will not
present great difficulties.
Isaac Weissman, representative of World Jewish Congress, is attempting to
bring 6000 hidden children clandestinely out of France through Spain to Portugal,
and 3000 others who are registered in France; the later, if possible, through legal
channels. He must have War Refugee Board's cooperation, both financial and practi-
cal, otherwise promising plans may fail. Advise giving him all cooperation
possible.
NORWEB
WSB
Regraded Unclassified
Lisbon
355
MFG - 434
This telegram must be
Dated April 19, 1944
paraphrased before being
communicated to anyone
Rec'd 1:20 a.m. 20th
other than a Governmental
agency (SCOO)
Secretary of State,
Washington.
1168, April 19, 5p.m. (SECTION TWO)
Weissman has an organization but lacks sufficient funds to finance project.
He estimates cost per child to be $335 each, delivered in Portugal. On basis
of 300 children per month this would involve a monthly appropriation of $100,000.
Is War Refugee Board prepared to guarantee this? If all were gotten out this
would involve $3,000,000; however we doubt any such number. Considerable funds
must be available immediately as first small group are expected through within
few days. Request immediate authorization to expend up to 100,000 on this pro-
ject. Cable reply soonest.
It is intention of World Jewish Congress to send majority to Palestine.
For that country visas are immediately available here with preference to chil-
dren. This presents a problem as there will be a conflict between Zionist and
non-Zionist Jewish organizations regarding ultimate destination of children.
From here it seems easier and less expensive to send children to Palestine than
to United States. Would suggest original plans be carried through unless strong
objection your part. We need clear directive from Department and WFB on this
point. Cable advice.
Any publicity regarding clandestine evacuation from France would en-
danger success. Publicity any project must be carefully scrutinized and Lega-
tion should be consulted in advance. Although reasons for publicity a minimum
thereof will ensure most effective work.
END MESSAGE.
NORWEB
BB
Regraded Unclassified
356
PARAPHRASE OF TELEGRAM SENT
FROM:
Secretary of State, Washington
TO:
American Embassy. Madrid
DATED:
April 19, 1944
NUMBER: 1090
CONFIDENTIAL
Department's cable of April 10, no. 992, is referred
to herewith, especially with regard to the question invol-
ving the return to Vittel of the 238 internees who were
evacuated to some other point. While an answer to the
whole of the cable is urgently desired, we would appreciate
knowing at once the action taken in respect of the request
made in our cable and the action which the Spanish Govern-
ment took.
HULL
Regraded Unclassified
357
CABLE TO HARRISON, BERN, FROM THE WAR REFUGEE BOARD
The War Refugee Board requests that you deliver the following
message to Islambek Khan, Afghan Legation, Bern: QUOTE Proceeding
abroad on business expect to arrive Palace Hotèl, Lisbon, May 3.
Please COME and see me in Habon as soon as possible. Signed
David Paul Joffo. UNQUOTE
Attached hereto is a cable to Minister Harrison, Bern, which
I would appreciate having transmitted promptly. The files of the
State Department will show that Mr. Joffo is an American citizen
and that a passport has been issued to him. They will also show
that Mrs. Shipley requested the Portuguese Legation to expedite
the issuance of a visa to him. While Mr. Joffo is going abroad
for private reasons, we have accepted his kind offer to be of
assistance. Mr. Joffo tells us that Mr. Islambek Khan is an
old personal friend of his and the attached message is in con-
nection with Mr. Joffo's program of assistance in the refugee
problem
April 19, 1944
11:35 Re We
LSLessertals 4/18/44
Regraded Unclassified
358
PARAPHRASE OF TELEGRAM RECIEVED
FROM:
The American Minister, Bern
TO:
The Secretary of State, Washington
DATE:
April 19, 1944
NUMBER:
2464
CONFIDENTIAL
The following message is sent for the Agudas Israel world or-
ganization (see number 1153 dated April 5, 1944, from the Depart-
ment) by Sternbuch.
Formerly such papers were issued by the following Consulates:
Chile, Costa Rica, Ecuador, Haiti, Honduras, Paraguay, Peru,
Venezuela, Bolivia, Nicaragua and Uruguay. Only from the San Sal-
vador Consulate are these documents now available, In order to
save people in Hungary it is of first importance that Consulates
in Switzerland be authorized to confidentially issue to us pass-
ports or citizenship documents to be distributed to refugees free
of charge. Traffic in false passports would be ended by this
measure. The responsibility would be assumed by the Committee that
passports would be used only for temporary protection and when the
emergency is past they would be returned to the issuing states.
Sternbuch signed the foregoing.
The following is for the Department:
According to his knowledge it is stated by Sternbuch that only
the Consulates of Haiti, Honduras, Nicaragua, Paraguay, Peru and San
Salvador have issued false passports in Switzerland although they
have been issued elsewhere in Europe by Consulates of other countries
named above.
HARRISON
DCR:MPL
4/20/44
Regraded Unclassified
359
PARAPHRASE OF TELEGRAM RECEIVED
FROM:
The American Minister, Bern
TO:
The Secretary of State, Washington
DATE:
April 19, 1944
NUMBER: 2467
SECRET
According to Sternbuch the following telegram from
Szmulewicz in Shanghai has been received in substance:
(Number 2117 dated April 5 from the Legation)
The support of Rosenheim is advisable in the weekly
amount of five thousand Swiss francs. We are wondering why
no reply has been received. It is a matter of time with refer-
ence to the fifty rabhis. Olef Podlassuk married Telsisochor
and Kletzker.
It is requested by Sternbuch that this information be sent
to Rosenheim and also to the Union of Opthodox Rabbis.
HARRISON
DCR:MPL
4/21/44
Regraded Unclassified
360
BE-329
Stockholm
This telegram must be
paraphrased before being
Dated
April 19, 1944
communicated to anyone
other than a Governmental
Rec'd
8:32 p.m.
agency. (BR)
Secretary of State
Washington
1355, April 19, 6.p.m.
Authorization is urgently requested to employ
following aliens to assist Iver Olsen in connection
with his work as Stockholm representative of War
Refugee Board.
(1) Miss Toue Filseth, Norwegian, 88 assistant
and consultant on refugee problems, at $3,000 per
annum. For several years she has been executive secretary
of "ansen-Aid activities for the stateless and has
had wide organizational experience in this field in
Oslo, Geneva, Vienna, Praha and Warsaw. More recently
has been engaged as consultant by Swedish Social
Styrelsen and Danish Legation on refugee problems.
Exceptionally capable highly regarded in Sweden and
excellent contacts.
(2) Miss Ulla Afwirsen, Swedish, as alien clerk
at $1440 per annum. Excellent linguist and has had
secretarial experience. Will assist in preliminary
interviewing, maintenance of card index and filing
system, and will work directly with Miss Filseth.
These appointments are essential in order to
permit Oslen to devote sufficient time to his other
duties as Financeial Attache. Telegraphic reply
requested.
JOHNSON
RR
Regraded Unclassified
361
TELEGRAM SENT
This telegram must be
paraphrased before being
April 19, 1944
communicated to anyone
8 P.M.
other than a Government
Agency (BR).
AMEMBASSY
ANKARA
350
FOR THE AMBASSADOR FROM WAR REFUGEE BOARD
WRB no. 24
Representative of Joint Distribution Committee in Spain has
advised Board danger of deportation approximately 800 Jews in
France who claim Turkish nationality. Lists of these people have
been forwarded to Ankara by Turkish Consuls who await decision
concerning their status. Your opinion is requested as to whether
Board should raise question with Turkish Ambassador here in
view of negotiations reported in Embassy cable 299 of February 19.
HULL
(GLW)
WRB:GLW:KG
4/19/44
WE
NE
Regraded Unclassified
362
TELEGRAM SENT
feh
is Telegram must be
April 19, 1944
paraphrased before being
communicated to anyone
9 p.m.
other than a Government
gency.
(BR)
AMEMBASSY,
ANKARA.
351
FOR THE AMBASSADOR FROM WAR REFUGEE BOARD.
WRB No. 27.
Hirschmann has informed us in detail of the enormous diffi-
culties you over came in personally arranging with the Turkish
authorities to allow the refugees from the SS MILKA and the
SS MARITZA to land in Istanbul and to be supplied immediately
with railroad transportation through Turkey to Palestine.
Hirschmann also informs us that there will in all probability
be other boats approaching Istanbul, which are in the same cate-
gory, and that these also would not be authorized to disembark
their passengers in Turkey without your personal intervention.
Highest commendation 1s due you for the resourceful appli-
cation of the goodwill you had built up with the Turkish officials
in dealing successfully with this work of mercy in these crucial
months.
HULL
(GLW)
NE
WRB:GLW:KG
4/19/44
Regraded Unclassified
363
PARAPHRASE OF THENGRAM RECEIVED
FROM:
The American Ambassador, Ankara
TO:
The Secretary of State, Washington
DATE:
April 19, 1944
NUMBER: 711 (Section 1)
CONFIDENTIAL
The following mmp as number 38 from Ankara is
from the Ambassador for the War Refuges Board. It refers to
number 324 dated April 13 from the Department.
1. In as such as I was advised yesterday by the Minister
for Foreign Affairs that the request of the Turkish Ambassador
had been referred by the Foreign Office to the Director General
of the Tark State Steamship Lines for decision, the understand-
ing of the Turkish Ambassador that this Government is no longer
issisting that a guarantee be given that a passenger vessel TO"
place the TARI but will be willing to accept the guarantee of a
cargo ship as a replacement is somewhat premature to say the
least. It was also stated w the Foreign Minister that there
was nothing further be could do regarding the matter dace he
was not in a position to compel the Director General to accept
a guarantee of which he did not approve. Today when I inquired
of the Director Generá be advised no that as yet be had not
reached a decision but that as soon as possible he could let =
know his decision regarding this matter. In their efforts to
secure a passenger ship guarantee from the War Shipping Adminis-
tration the Ministry of Foreign Affairs' position in this matter
come to be analogous to that of the War Befuges Board and the
Department of State. Every effort is, of course, being exerted
by me to induce the Director General to accept a guarantee of
a cargo ship but I can not give my assurances of success at
this time. With reference to the foregoing, as the Board seems
to expect the same, if the Turkish Ambassador should receive
information from his Government that it is prepared to accept
the guarantee. of a carge ship I sheald appreciate being informed
at caose
2. The transfer of $160,000 to Kelley has been effected and
the money is at his disposal according to & notice which was 200
eeived from the Central Bank this morning. There will be a care-
ful observation regarding the accounting for these funds in 80⑉
cordance with the instructions of the Reard.
3e In the first instance way request of the Representative
of the Intererose in Ankara and subsequently of the Minister for
Foreign Affairs, vas for a German safe-comduct from Istambul to
Constansa, from Constansa to Haifa and from Haifa to Istenbul
for the TARI. Regarding the details of the request for German
safe- conduct
Regraded Unclassified
364
-2-
#711 from Ankara (Section 1)
safe-conduct which other sources made I am, of course, not
familiar.
STEINHARDT
DCR:MPL
4/22/44
Regraded Unclassified
365
PARAPHRASE OF TELEGRAM RECEIVED
FROM:
The American Ambassador, Ankara
TO:
The Secretary of State, Washington
DATE:
April 19, 1944
NUMBER:
711
(Section 2)
CONFIDENTIAL
4. Up to the present time I have been successful in post-
poning the signing of the charter for the TARI. Nevertheless
during the past week the ship has been ready to sail and in my
most recent converstation with the Minister for Foreign Affairs
it was clearly indicated by him that further delay in the signing
of the charter would not be countenanced on the grounds that the
ship is being held at our disposal at a loss to State Steamship
Lines which loss is a considerable amount daily. Regarding the
further postponement & the signing of the charter I am embarrassed
by the fact that the delay now results from an attempt on my part
to have the guarantee of a cargo ship accepted inlieu of a
guarantee for a passenger ship which was the original condition.
In view of the circumstances I shall in all probability find it
necessary to sign the charter within the next few days regardless
of whether the German safe conduct is or is not received, in order
not to prejudice the entire refugee program of the Board in the
eyes of the Government of Turkey and also in order to keep from
irritating the authorities of Turkey who already are sufficiently
vested at the last minute request that they accept the guarantee
of a cargo boat. The confidence of the Board in my judgment is
very much appreciated by me in this connection. If I should find
it necessary or even desirable to sign the charter prior to
the receipt of the German safe conduct, the Board may rest as-
sured that I shall do so only in the firm conviction that the
importance of keeping faith with the Government of Turkey in
order not to prejudice the overall program of the Board for
the rescue of refugees in this part of the world would more than
justify the payment of even the entire penalty by the Board for
the nonuse of the TARI.
STEINHARDT
DCR:MPL
4/22/44
Regraded Unclassified
366
GEM-648 .
Ankara
This telegram must be
paraphrased before being
Dated
April 19, 1944
communicated to anyone
other than a Governmental
Rec'd
7:45 p.m., 20th.
agency. (BR)
Secretary of State,
Washington.
712, April 19, 9 p.m.
FOR THE WAR REFUGEE BOARD FROM THE AMBASSADOR
ANKARA.
No. 39, Department's 333, April 15,
The Swedish Minister informed me yesterday that
he had received word from Stockholm that it is not
possible for the Swedish Government to make the
SS BARDALAND available for the movement of refugees
from the Balkans to Palestine as the vessel is
returning to Sweden.
STEINHARDT
WMB
Regraded Unclassified
PARAPHRASE OF TELEGRAM RECEIVED
367
FROM:
The American Ambassador, Ankara
TO:
The Secretary of State, Washington
DATE:
April 19, 1944
NUMBER: 713 (Section 1)
SECRET
is Ankara's number 40 the following message to from the
Ambassador for the War Refuges Board and it refere to number
337 dated April 15 from the Department.
Between the voyages of the SS MARITZA and the 88 MILKA
on the one hand and that of the SS BELLACITE on the other, there
is a fundamental difference. The MARITZA and the MILKA sailed
without either the proper papers or the authority to enter a
port of Turkey and practically all of the refugees on board were
without Falestine entry certificates and were also without Turk-
ish entrance or transit visas. Illegal is the word used
here in referring to voyages of this character. The BELLACITA
on the other hand has the proper papers, permission to enter the
port of Istanbul and it is said that all of the refugees on board
have Palestine entry certificates as well as Turkish transit
visas. Legal is the word used here in referring to voyages of
this character.
STRINHARDT
DOR:MPL
4/21/44
Regraded Unclassified
368
PARAPHRASE OF TELEGRAM RECEIVED
FROM:
The American Ambassador, Ankara
TO:
The Secretary of State, Washington
DATE:
April 19, 1944
NUMBER: 713
(Section 2)
SECHET
Up to the present time the BELLACITA has not arrived but
no difficulty in transiting the refugees on board to Palestine
is expected by me. With reference to further illegal voyages
by the MARITZA and the MILKA I feel reasonably well satisfied
that if the number does not go beyond five hundred a month, I
can persuade the Minister for Foreign Affairs to allow the
entry and transit of refugees carried on such illegal voyages
as each occasion may present itself. Doubtless the carrying
capacity of the railroad to the Syrian frontier from Istanbul
will in each instance affect his decision. With reference to
the substantial increase in the transit to Palestine from Istan-
bul arriving here legally which has taken place during the past
two or three months and being thoroughly familiar with the ad-
ditional load which the transportation system will support, my
best judgment is that approximately an additional five hundred
refugees arriving each month illegally would be the maximus for
whom rail transportation could be provided by the Foreign Minister.
STEINHARDT
DOR:MPL
4/21/44
Regraded Unclassified
369
FMH-475
PLAIN
Moscow
Dated
April 19, 1944
Rec'd
10:15 a.m., 20th
Secretary of State,
Washington.
1367, nineteenth
PRAVDA for April 17 and RED STAR for April 18
publish a Tass despatch from Cairo stating that
during Lehman's visit there an appeal from the
National Committee of Liberation of Yugoslavia to
the Council of UNRRA for immediate aid for
Yugoslavia and the admission of the National
Committee to membership tn UNRRA was submitted to
him.
The item continues that Lehman promised to
place these questions before the next meeting of
the UNRRA council in June.
HARRIMAN
WSB
Regraded Unclassified
370
TELEGRAM SENT
FMH
PLAIN
April 19, 1944
U. S. URGENT
birdle
AMENBASSY
OTTAWA
31, ninsteenth
FOR THE AMBASSADOR FROM THE SECRETARY OF THE TREASURY.
1. Arrangemente are being made for the simultaneous
publication in Washington, London, and & number of the
capitals of the United Nations of the joint statement by
technical experts of the United and Associated Nations on
the establishment of an International Monetary Fund.
Copy of this Joint statement has been given to Plumptre
and we have telegraphed copy to you. We are discussing
the issuing of a joint statement on the Bank for Reconstrue-
tion and Development, a copy of which has also been telegraphed
to you.
2. I am to appear before the appropriate Congressional
committees on Friday, April 21, to bring them up to date
on our discussions regarding international financiel coopera-
tion and to present to them the joint statement. This joint
statement on the Monetary Fund will be released on Friday,
April 21, 8:00 p.m. Washington time for Saturday morning
Regraded Unclassified
371
-2-
#31, nineteenth to Ottawa
press. It is imporative that the statement should not
(repeat not) be released elsewhere before it 10 released
in Washington, It has not yet been decided when the
joint statement on the Bank will be released. We will
keep you informed.
HULL
(EGC)
Approved by phone
Mr. Persons - BC 4/18/44
FMA:E0C:eeo
4/18/44
Regraded Unclassified
372
For security receive the
L X t 0' Lold massage must
ed.
KEM-206
Chungking via N.R.
This telegram must be
paraphrased before being
Dated April 19, 1944
communicated to anyone
other than a Government
Rec'd 3:00 p.m.
agency. (SCOO)
DEPARTMENT OF STATE
Secretary of State,
DIVISION OF
Washington.
APR 20 1944
COMMUNICATIONS
685, April 19, 5 p.m.
ANN adler permone
TO SECRETARY OF TREASURY FROM RAILER.
RE your TR 06 March 6, and 107, January 20.
Have finally received formal reply from Ministry
of Finance to my request for its attitude to appropriate
procedure for remittances to occupied areas. It takes
note of Treasury's acceptance of Dr. Kung's proposal
and states that the Central Bank, the Bank of China,
and the Ministry of Foreign Affairs have been duly
notified.
GAUSS
HTM
Regraded Unclassified
373
Treasury Department
Division of Monetary Research
Date
May 4
19 44
To:
Secretary Morgenthau
From:
Mr. White
Sir Jeremy Raisman, head of
the Finance Department of the
India Government will visit the
United States. He may attend
the international conference on
currency stabilization.
MA374
374
AIRGRAM
From: American Mission
New Delhi
Date: April 19, 1944, 5 p.m.
Rec'd: May 2, 4 p.m.
Secretary of State,
Washington.
A-41, April 19, 1944, 5 p.m.
Sir Jeremy Raisman, Finance Member of the Viceroy's Executive
Council, intends to visit the United States in the near future. He
told an officer of the Mission today that he is leaving for England
by air on May 4; and after 8. few days there will fly to the United
States and spend about two weeks in Washington. It will be his first
visit to the United States.
His position in India corresponds to that of a Minister of Finance,
or to that of the Secretary of the Treasury of the United States. He has
been in the Indian Civil Service for 28 years.
Sir Jeremy originally planned to make his visit to the United States
coincide with the proposed international conference on currency stabiliza-
tion.
MERRELL
851.5
STM/1gk
ef:copy
5-4-44
Regraded Unclassified
375
PARAPHRASE OF TELEGRAM SENT
FROM:
Secretary of State, Washington
TO:
AMEMBASSY, MOSCOW
DATED:
April 19, 1944, 7 p.m.
NO.:
161
SECRET
From Secretary of Treasury for Harriman:
It is not possible to wait beyond Thursday for reply to our cable
no. 938 regarding publication of joint statement. Thursday morning
between nine and eleven, Washington time, we shall telephone to you if
by that time we have not had a definite reply. We shall expect an
answer in the terms of yes or no, for security reasons, should we
telephone.
HULL
ef:copy
4-27-44
Regraded Unclassified
376
NOT TO BE RE-TRANSLITTED
COPY NO.
11
SECRET
OPTEL No. 126
Information received up to 10 a.m., 19th April, 1944.
1. MILITARY
BURMA. On the 16th Gurkha troops captured a village
24 miles southwest of IMPHAL but Japanese counter-attack against
them was successful; our troops resumed the attack the following
day. A battalion of Scottish troops 24 miles northeast of IMPHAL
was attacked by 2 Japanese companies; at least 22 enemy killed.
On the 15th our troops repulsed an attack on the DIMAPUR
KOHIMA rund about 5 miles northwest of KOHIMA. Japanese are re-
ported to have penotrated our forward positions west of KOHIKA
on 15th/16th but no further details available.
2. AIR OPERATIONS
WESTERN FRONT. 18th. Total 732 U.S. heavy hombers
supported by 691 fighters attacked the BERLIN/BRANDENBURG area,
dropping 649 tons on 2 aircraft factories, 208 tons on 2 air-
fields, 190 tons on BRANDENBURG, and 375 tons on other objectives
with results generally good, 12 more heavy bombers dropped 38
tons on a military construction PAS DE CALAIS area, Enemy casual»
ties reported by fighters - 15 destroyed, 12 damaged on the
ground and 4 destroyed in the air. Ours - 19 bombers, 5 fighters
254 medium, 50 light and 126 fighter bombers operated over
Northern FRANCE and BELGIUM, dropping 238 tons on Coastal gun
positions, 214 tons on CHARLEROI Marshalling Yard and 42 tons on
military constructions, 3 enemy aircraft destroyed, 3 medium
bombers missing,
18th/19th. 1130 aircraft despatched:
Goods yards at ROUEN
287 (3 destroyed by enem
Intruders)
TERGNIER
171 (6 missing)
PARIS (JUNTISY and NOISY LE SEC) 371 (6 missing)
LE MANS
2
BLRLIN
24
OSNAB UCK
2
Sea-mining
168 (3 missing)
Leaflets
40
Intruders
65
Preliminary reports indicate clear weather for attacks on rail-
ways. 50 German aircraft operated over East Anglia and the
London area and 8 others over East Coast. Fighters destroyed
10 and probably destroyed 3, anti-aircraft claim 3. 39 fatal
casualties SO far reported London, mainly in Northeast and South-
east, North Middlesex Hospital Eumonton received direct hit.
One large fire NONFORD. 1 fatal casualty and about 50 injured
ROCHESTER,
YUGOSLAVIA. 16th. 144 0.0. heavy bombers dropped 350
tons on an airfield at BELGRADE. 3 bombers missing. Many hits
on insta lations and grounded aircraft,
RJMANIA. THEMI 16th. 151 Liberators dropped 334 tons on the
airfieTd and railway centre at TURNUL SEVERIN and 148 other
Liberators dropped 282 tons on similar objectives BRASOV. Enem
casualties 10. 3, 2. 5 Liberators missing. Both places bumbed
from high altitude. Numerous bursts seen on objectives.
Regraded Unclassified