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Chargé expressed the hope that the President could make some public statement showing his appreciation of the dangers of the economic situation in Germany. Inasmuch as there is to be a final meeting of the Reparations Commission with German delegates in attendance on Wednesday, I feel it would be unwise for us in any way to inject ourselves into the situation at this moment, and did not, therefore, give any encouragement to this request of the Chargé. I immediately cabled Houghton the substance of the note, and asked for his comments, which have not been received as yet.

This morning, however, I am in receipt of a delayed dispatch from Houghton dated August 25th, as follows:

“ Was called to Chancellor's house last evening and talked with Von Simson, who had been directed by Chancellor to make me fol. lowing statement :

*It is impossible to surrender mines and forests as security for five months moratorium, first, because these properties belong substantially to individual states and not to Reich, and second, because such action would leave Germany stripped bare and without adequate security for necessary extension of moratorium. Bergmann however offered Bradbury and Mauclère to put up fifty million gold marks in foreign securities which government holds, to cover any default in deliveries of coal and wood. Chancellor hesitated to accept this proposal but finally agreed. Proposal agreeable also to Bradbury and Mauclère. This was Wednesday night. Yesterday noon when negotiations were resumed Mauclère presented telegram from Paris in which Bergmann's proposal was flatly declined. Bradbury then proposed, in case of default, any mine or forest could be taken by Reparation Commission and used to make up default but in case default was not made up title of property was to pass definitely into the hands of commission. This proposition was declined by the Germans on the ground that they could not foresee what requisitions would be made at any time. Bradbury then asked them to have confidence in commission which Germans naturally refused, and then said frankly that under existing conditions England would simply stand aside and preserve a sulky neutrality and let France proceed.'

In my opinion negotiations are now at complete deadlock. Rumored that Mauclère has been ordered to return to Paris. D’Abernon? is exceedingly active and working with Bradbury. D’Abernon's conception of situation strikes me as essentially that of apologetic. He thinks entire problem based on control of mark. Both he and Bradbury apparently agree that a resumption of gold standard based on one gold mark to 100 paper will save situation. Government has one milliard gold and two hundred milliard of paper outstanding and Bradbury thinks intrinsic value of mark somewhat less than half its present value. Personally I believe this conception entirely too narrow. Problem political as well as financial. Evident no agreement can now be reached on different elements in problem. It must be taken up as a whole. France will not take initial step however and Germany is afraid to in the belief that France does not want settlement and seeks merely to ruin Germany. Situation obviously tense and electrical. Signed Houghton.

of the German Ministry of Economics.
German representative with the Reparation Commission.

British representative on the Reparation Commission.
'French assistant representative on the Reparation Commission.
'British Ambassador in Germany.

If no agreement is reached at final meeting of Reparations Commission with German delegates Wednesday there may be an opportunity for this government to help the situation if we had some concrete proposals to put forward. The President writes me this morning that “I think this government would be very glad to be helpful in a practical and consistent way. Unless we are further advised, I do not understand what course we might helpfully pursue”.

Of course it is to be hoped, and in my opinion it is very probable, that an agreement will be reached by the Reparations Commission with the Germans at the Wednesday meeting, but, in case no agreement is reached and the French carry out their threatened policy of seizing the national mines and forests in the Ruhr, then I should wish to know whether you would care to have the Department take any step other than the withdrawal of the troops from the Rhine. Would you, for instance, care to consider putting forward the suggestion which you had in mind before the receipt of the Balfour

note ? 8

PHILLIPS

862.51/1538 : Telegram The Ambassador in Germany (Houghton) to the Acting Secretary

of State

[Paraphrase)

BERLIN, August 29, 1922noon.

[Received August 30—3:08 a.m.] 172. The statement which was made to you by the German Chargé d'Affaires, August 26, did not pass through the Foreign Office but came direct from the Chancellor himself. It simply means this. The Chancellor regards as final the proposition now being considered by Reparation Commission, in which German industrialists guarantee Government against failure of coal and wood shipments. The Chancellor can go no further. The Chancellor will be unable to agree if France refuses proposition covered by [sic] Government demand for mines and forests and it is possible that his government may fall. The Chancellor's note is, therefore, a personal appeal to the Government of the United States to urge an acceptance of the proposition which is now before the Reparations Commission.

The Government also fears any offer on the part of the Belgians to accept German Government bills of exchange guaranteed by the Reichs Bank or D Banks, (1) because neither Reichs Bank nor D Banks will give guarantee and (2) because Government considers it an indirect attack on gold reserve. The feeling here is optimistic that the Commission will, in some form, accept proposition.

*Note of Aug. 1, 1922, to the French Ambassador in Great Britain, vol. I,

P. 406.

I have no comment to make on the above except to state that I doubt if any member of the Government really seriously expects the United States to take active steps to influence Reparation Commission. However, they realize that even an indirect expression of approval, as for instance through Logan, would have much weight. Being familiar with the desperate situation existing here, they cling to the hope that the United States will make its influence felt in some way in their behalf.

I am inclined to think that the English position here is somewhat weakened. I have reason to suspect that Foreign Office now believe England is seeking rather to weaken France by making a German loan impossible than to help save Germany. Therefore, any friendly gesture on the part of the United States will be very much appreciated.

HOUGHTON

862.51/1541 : Telegram

The Secretary of State to the Acting Secretary of State

S. S.“ PAN AMERICA ”, August 30, 1922noon.

[Received August 31–4:53 p. m.] 32. Your number 6, August 28, 3 p. m. I do not see that we can make any helpful suggestion while subject is a question for the Reparations Commission. If French have fully determined to act at once in case no agreement is reached no suggestion that you might make would affect their decision. I should not care to reach any final conclusion as to our course until further advised. Have the advantage of knowing precise situation after Commission's meeting. Keep me fully advised.

HUGHES

462.00 R 29/210916 Memorandum by the Secretary of State of a Conversation with the

German Ambassador (Wiedfeldt), October 9, 1922

(Dxtract)

2. Conditions in Germany. The Ambassador had a memorandum before him which he did not leave with the Secretary; said that he

'American unofficial assistant representative on the Reparation Commission.

32604—vol. 11-38-18

ARTICLE 1

Subject to the provisions of the present Convention, the United States consents to the administration by the Government of the French Republic, pursuant to the aforesaid mandate, of the former German territory, described in Article 1 of the mandate.

ARTICLE 2

The United States and its nationals shall have and enjoy all the rights and benefits secured under the terms of Articles 2, 3, 4, 5, 6, 7, 8, and 9 of the mandate to members of the League of Nations and their nationals, notwithstanding the fact that the United States is not a member of the League of Nations.

ARTICLE 3

Vested American property rights in the mandated territory shall be respected and in no way impaired.

ARTICLE 4 A duplicate of the annual report to be made by the mandatory under article 11 [10] of the mandate shall be furnished to the United States.

ARTICLE 5 Nothing contained in the present Convention shall be affected by any modification which may be made in the terms of the mandate as recited above unless such modification shall have been assented to by the United States.

ARTICLE 6 The extradition treaties and conventions in force between the United States and France shall apply to the mandated territory.

ARTICLE 7
The present Convention shall be ratified in accordance with the
respective constitutional methods of the High Contracting Parties.
The ratifications shall be exchanged in Paris as soon as practicable.
It shall take effect on the date of the exchange of ratifications.

In witness whereof ..
Done in duplicate at ..... this ...

day of

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8629.01/9: Telegram

The Ambassador in France (Herrick) to the Secretary of Stats

PARIS, July 12, 1928

[Received July 19 283. Your 216 July 10, 5 p.m. Your text Government except that it wishes recital rel Germany to read as follows:

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8629.01/9: Telegram
The Secretary of State to the Amendon en Frau

WASHINGTON dwie 222. Your 283, July 12, 7 P.M.

When the Memorandum of July 6. rather dates for Togoland and the Cameroons 2 Ambassador at Washington, the Departure revised text of mandates, which wert er No. 2084 38 and 2086 of June 30, 245 to M. Poincaré when handin e the following:

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