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178 SECRET A-1766 Sept. 12, 1944 9:15 AM AMERICAN EMBASSY, LONDON. FROM DEPARTMENT AND FEA FOR END. Following telegram dated August 26, 1944 has been received from Geneva: "Intercross has received urgent appeal from Polish Cross concerning dire need food for hundred thousand women children aged persons evacuated Warsaw region now in camp at Pursakow and inquires as to possibility distributing certain quantity SFP ex-shipments 74 75 to these persons. Intercross believes could have distribution supervised by delegate." Since the situation of these unfortunate people would seem to be identical to those in concentration camps elsewhere in occupied Europe in behalf of whom arrangements were made in June during the discussions between Mr. Berle and Mr. Foot to forward limited amounts of relief supplies through the Inter- national Red Cross, we have authorised the American Red Cross to make the following reply to the above-quoted telegram: "Unable authorize distribution SFP for this purpose. However, Ameross authorizes shipment from cargo ex-CHRISTINA 250 tons canned goods from Switzerland to Pursskow for free distribution provided: "1. Intercross has information indicating need exceeds that of normal civilian population outside camp. #2. Intercross is able exercise supervision over distribution either directly or through agency responsible to Intercross, and 3. Intercross prepared submit complete reports supporting distribution food to proper beneficiaries." Your 7146, September 1. lie will keep in mind the possibility of diverting to Pursskow food packages now en route for persons in concentration damps. However, the action described above seems to be the only feasible measure that can be taken at present in view of the immediacy of the need and the time which would be required to forward these parcels (which have not as yet reached Goteberg) to these people. HULL edk SWP:EDK:EHJ 9-2-44 179 ORIGINAL TEXT OF TELEGRAM SENT FROM: Secretary of State. Washington TO: American Enbassy. London DATED: September 12, 1944 NUMBER: 7402 CONFIDENTIAL FROM WAR REFUGER BOARD TO WINANT AND MANN, LONDON Reference your No. 7191. September 2. 1944, concerning License W-2258. Information given you by Poles incorrect. Remittance to finance operations envisaged by License W-2258 will be made by Folish War Relief of USA, Inc. through regular banking channels to Jan Kwapinski and/or Jas Stanosyk and/or Ludwik Gresfeld and/or Emanuel Scherer, London. Use of dollar currency is an acceptable way of implementing third method specified in license. THIS IS WRB CABLE TO LONDON NO. 2. MULL 180 Distribution of September 12, 1944 special arrangement. 7 p.m. true reading only by (SECRET w) WAR REFUGEE BOARD AMPOLAD CASERTA 128 The following for Ackermann is WRB 48. Please refer to your 106 of August 11 and other reports suggesting the establishment of stockpiles in Italy to be available for the relief of Yugoslavs upon the liberation of their country. Your efforts in bringing the need for such stockpiles to the attention of Army and UNRRA officials are highly praiseworthy and should certainly be continued if you deem it desirable to do so. We have considered carefully that action the Board could take here to support your efforts, particularly in the light of present military operations and successes in Yugoslavia and elsewhere in Europe. In addition to the fact that post- war or postliberation relief is not strictly within the province of the Board, we have concluded that there is little effective action we can take at this end to hasten the creation of stockpiles which you have not already taken by drawin the attention of the responsible agencies to the urgency of the problem. HULL (GHW) . WRB:MMV:KG 9/11/44 181 Distribution of true reading only by September 12, 1944 special arrangement 8 p.m. (SECRET W) War Refugee Board AMPOLAD CASERTA 129 The following is for Offie from War Refugee Board as its 47. Reference your 272 of September 3, 1944. Relief to refugees in areas liberated from the Germans not within jurisdiction of War Refugee Board. American Jewish Joint Distribution Committee is arranging for assistance through Switzerland to Polish-Hungarian refugees in Bucharest referred to in your oable. HULL (GHW) WRB:MMV:KG 9/7/44 SE 182 9/12/44 CABLE FROM WAR REFUGEE BOARD TO ACKERMANN, AMERICAN CONSULATE GENERAL, NAPLES, ITALY. Please refer to your 106 of August 11 and other reports suggesting the establishment of stockpiles in Italy to be available for the relief of Yugoslavs upon the liberation of their country. Your efforts in bringing the need for such stockpiles to the attention of Army and UNRRA officials are highly praiseworthy and should certainly be continued if you deem it desirable to do so. We have considered carefully what action the Board could take here to support your efforts, particularly in the light of present military operations and successes in Yugoslavia and elsewhere in Europe. In addition to the fact that postwar or postliberation relief is not strictly within the province of the Board, we have concluded that there is little effective action we can take at this end to hasten the creation of stockpiles which you have not already taken by drawing the attention of the responsible agencies to the urgency of the problem. THIS IS WRB CABLE TO NAPLES NO. 48 183 PLAIN PEM-246 Rome Dated September 12. 1944 Rec'd 3:10 p.m. Secretary of State Washington 335, Twelfth No. 4. FOLLOWING FOR AMERICAN JOINT DISTRIBUTION COMMITTEE, NEW YORK, FROM ARTHUR GREENLEIGH RELAY JOSEPH SCHWARTZ: Received your cablegram yesterday. Had assumed detailed budget sent you by Perlman, July, would suffice. Following represents minimum needs on inadequate standard for September For Rome assistance 700 foreign and 700 Italian refugees 2,000,600 lire. For medical care for refugees for administration and for retraining, 300,000 lire. For relief 2000 Roman Jews 200,000 lire. will you also authorize subvention Jewish community Rome for reopen orghanage, general hospital, matrenity hospital, day nursery, et cetera, additional 600.000 lire per month For assistance destitute newly liberated areas of Perugia Sienna Assisi Aquila Terano Leghorn Florence, need additionally total 600,000 lire for 600 foreign and Italian refugees. For Bari area for 180 foreign and ninety Italian refugees and for retraining. need 190,000 lire. For Naples area for 656 foreign and 24 Italian refugees, need 560,000 lire. For repayment debts Bari requires 600,000 lire. For repayment of only pressing debts Rome area, urgently need 8,000,000 lire. Every effort being made reduce costs. Those eligible aid from Legation or Mission shifted from Delasem rolls. Letter follows giving details. LMS KIRK 184 AIRGRAM From: American Legation UNRESTRICTED Tangier, Morocco Date: September 12, 1944 Rec'd: September 19, 5 p.m. Secretary of State Washington A-199 September 12, 1944 6 p.m. Reference Legation's telegram No1 157 of June 2, 10 a.m. 1944, and subsequent correspondence concerning the departure from Hungary of 500 Jewish refugee children. The following developments may be of interest to the War Refugee Board. A telegram dated August 31, 1944, addressed by the International Red Cross at Budapest to the President of the local Jewish community, a copy of which was exhibited to the Legation, read in translation partially as follows: "Government authorized departure 500 children and 70 adults accompanying staff transit visas at present unobtainable stop gathering children in special camp under protection Interna- tional Red Cross Committee around Spanish Legation here daily cost about 4,000 pengoes stop cable agreement stop In reply to this telegram the local office of the American Joint Distribution Committee cabled on September 3, 1944, agreeing to accept responsibility for the maintenance of this refugee group. The local representative of the American Joint Distribution Committee has informed me that it is his belief that the 500 children and 70 adults will remain in Hungary under the protection of the Spanish Legation in Budapest pending the conclusion of hostilities when they will be free to resume their normal mode of living. He adds that in conversation with Senor Suner, Spanish Consul General at Tangier, the Consul General-expressed his interest in having the number of Jewish persons in Hungary under Spanish protection substantially increased and that he intended to make such a proposal to the Spanish Foreign Office. The Department will be informed of any developments in this direction. CHILDS 840.1 ADF:gp Copy to: American Embassy, Madrid 185 MB This telegram must be paraphrased before being September 12, 1944 communicated to anyone 10 a.m. other than a Government agency. (RESTRICTED) WAR REFUGEE BOARD AMEMBASSY LISBON 2493 The War Refugee Board cable 88 below is for Dexter. Please refer to your message of August 29, concerning the projects which remain to be carried out by the Board from Portugal. Since, in your opinion, the problems outlined by you can within three and possibly two months be brought to the stage where the regular Legation staff can carry on the functions still remaining, it is suggested that you plan to conclude within that time, and in any case as rapidly as possible, your operations in Portugal as Special Representative of the War Refugee Board. In regard to your recommendation that a representative be sent to France under the auspices of the War Refugee Board, reference is made to our circular of September 7 indicating that the Board's activities should be strictly limited to the rescue and relief of refugees in enemy occupied territory and that refugee problems in liberated areas are not regarded as being within the Board's functions. aAt the present time, the military situation in the West is too fluid to make feasible the use of France as a base for rescue and relief operations in enemy territory. Pursuant to your suggestion, the Unitarian Service Committee is being advised that you and Widen may soon be free to return to your previous employment if the Committee desires your services. Pehle expresses his appreciateion and thanks for the services you have rendered the Board. Sent to Lisbon, repeated to London for Mann as 7371 of Sept. 12. HULL CODE ROOM: Repeat to London 7371 with following opeining sentence. The following to Lisbon is repeated for information of Mann. 186 CABLE TO NORWEB, LISBON, FROM WAR REFUGEE BOARD. Please deliver the following message to Elisabeth Daxter, 111 Rua Marquez de Fronteira, Lisbon, from Edward A. Cahill of the Unitarian Service Committee: "217 NOEL FIELD MARSBILLE PLEASE RELAY QUOTE THRILLED NEWS YOUR ARRIVAL MARSEILLES STOP COMMITTEE URGES ALL ENERGY INITATIVE REESTABLISHING REFUGEE WORK FRANCE WITH OFFICE AND PERSONNEL STOP PLEDGE FULL FINANCIAL SUPPORT STOP PLEASE REPORT YOUR FINDINGS AND DECISIONS SOONEST STOP YOUR TOTAL JANUARY THROUGH SEPTEMBER REFUGE SWITZERLAND BUDGET 64.250.00 CABLED YOU 10.000 AUGUST 31 STOP BALANCE SWISS BUDGET 9.317.20 AVAILABLE CABLING SOONEST STOP REFERENCE YOUR REQUEST YUGOSLAVIA CZECHOBLOVAKIA HUNGARY ADDITIONAL FRANCE CABLING BERNE AS USUAL TODAY 20.000 THIS ACCOUNT YOUR DISCRETION MAY USE ALL FRANCE STOP AVAILABLE ABOUT 13.000 MORE FOR FRANCE NOW STOP HOPING FURTHER GRANT 50.000 ALL AMOUNTS ABOVE DOLLARS UNQUOTE" THIS IS WRB CABLE TO LISBON NO. 90 9:30 a.m. September 12, 1944 RDrury 9/11/44 187 September 12, 1944 MB Distribution of true reading only by 7 p.m. special arrangement. (SECRET w) War Refugee Board AMLEGATION STOCKHOLM 1817 The following for Olsen is WRB 84. Reference Department's 1576 of August 8, 1944 (WRB to Stockholm No. 69). American Relief for Norway advises that third remittance of $10,000 will be transferred to you this week for special Norwegian program. HULL (GLW) WRB:MMV:KG 9/12/44 NOE SWP WT 188 CABLE TO JOHNSON, STOCKHOLM, FOR OLSEN FROM WAR REFUGEE BOARD. Reference Department's 1576 of August 8, 1944 (WRB to Stockholm No. 69). American Relief for Norway advises that third remittance of $10,000 will be transferred to you this week for special Norwegian program. THIS IS WRB CABLE TO STOCKHOLM NO. 84 9:30 a.m. September 12, 1944 FHodel:rd 9/11/44 189 CABLE TO MINISTER JOHNSON, STOCKHOLM, FOR OLSEN FROM WAR REFUGEE BOARD Reference your Nos. 2569 of July 11 and 2668 of July 18. On recommendation of Board, Treasury has issued license to Polish War Relief permitting remittance of $25,000 to "Polska Social Ahjalpen for Flyktinger," care of Olsen. This is WRB cable to Stockholm No. 85 11:30 a.m. September 12, 1944 FHodel:rd 9/11/44 190 September 12, 1944 MB Distribution of true reading only by 8 p.m. special arrangement. (SECRET w) War Refugee Board AMLEGATION STOCKHOLM 1818 The cable below for Olsen is WRB 85. Reference your Nos. 2569 of July 11 and 2668 of July 18. On recommeriration of Board, Treasury has issued license to Polish War Relief permitting remittance of $25,000 to QUOTE Polska Social Ahjalpen for Flyktingar UNQUOTE care of Olsen. HULL (GLW) WRB:MMV:KG 9/12/44 NCE WT SWP 191 ORIGINAL THAT OF TELEGRAM SENT FROM: Secretary of State, Washington TO: American Legation. Bern DATED: September 12. 1944 NUMBER: 3152 SECRET For McClelland. Please deliver the fellowing message from Yead Hahatzala to Sternbuch, St. Gallens QUOTE Please detail your rescue activities in Hangury and Slevakia to McClelland. Please also communicate to McClelland NAMES and addresses of trusted leaders of rescue work in Hungery and Slevekia. It is hoped that this will enable these POTSORS to obtain financial assistance for rescue activities through WRB. UNQUOTE The fellowing is for MoClelland from WRD: Upon receipt of names and addresses please cable them at once to WRB. THIS IS WRB GABLE TO BERN NO. 165. NULL 192 CABLE TO MINISTER HARRISON, BERN, FOR MC CLELLAND FROM WAR REFUGEE BOARD. Please deliver the following message to Mrs. Noel Field, 12 Rue du Vieux College, Geneva, from Edward A. Cahill of the Unitarian Service Committee: QUOTE FOLLOWING MESSAGE HAS BEEN SENT TO ELISABETH DEXTER, LISBON INNERQUOTE 217 NOEL FIELD MARSEILLE PLEASE RELAY FOLLOWING MESSAGE STOP THRILLED NEWS YOUR ARRIVAL MARSEILLE STOP COMMITTEE URGES ALL ENERGY INITIATIVE REESTABLISHING REFUGEE WORK FRANCE WITHOFFICE AND PERSONNEL STOP PLEDGE FULL FINANCIAL SUPPORT STOP PLEASE REPORT YOUR FINDINGS AND DECISIONS SOONEST STOP YOUR TOTAL JANUARY THROUGH SEPTEMBER REFUGEE SWITZERLAND BUDGET 64.250.00 CABLES YOU 10.00 AUGUST 31 STOP BALANCE SWISS BUDGET 9.317.20 AVAILABLE CABLING SOONEST STOP REFERENCE YOUR REQUEST YUGOSLAVIA CZECHOSLOVAKIA HUNGARY ADDITIONAL FRANCE CABLING BERNE AS USUAL TODAY 20.000 THIS ACCOUNT YOUR DISCRETION MAY USE ALLERANCE STOP AVAILABLE ABOUT 13.000 MORE FOR FRANCE NOW STOP HOPING FURTHER GRANT 50.000 ALL AMOUNTS ABOVE DOLLARS END INNERQUOTE UNQUOTE THIS IS WRB CABLE TO BERN NO. 167 9:30 a.m. September 12, 1944 RDrury 9/11/44 193 CABLE TO MINISTER HARRISON FOR MCCLELLAND, BERN, SWITZERLAND The War Refugee Board requests that you deliver the following message to Jarblum Riegner, 37 Quai Wilson, Geneva, Switzerland, from Leon Kubowitzki, 1834 Broadway, New York, New York: QUOTE Number 132 learned 700 Jews deported from Fossoli camp to Germany. Have repeatedly requested Interredoross demand from fascist authorities in northern Italy right include Jews depréved freedom movement within scope of its work since Italians always conceded application POW Treaty to civilian internees. Suggest you urge Interredoross make formal represen- tation fascist authorities. WORLD JEWISH CONGRESS LEON KUBOWITZKI UNQUOTE THIS IS WRB CABLE TO BERN NO. 168 3:40 p.m. September 12, 1944 BAkziniar 9/11/44 194 PEM AMLEGATION PLAIN September 12, 1944 BERN 3154, Twelfth Regarding Fornand Salomon and his wife and daughter Yvonne, interned at Draney, near Paris; Jules Levy, Lina Levy, Sigismund Salomen and his sons Edgar, Gilbert, Alfred and Pierre, interned at Drancy; Pinkas Lipschuetz and his family residing at Brussels: Mr. and Mrs. Minkowski, Benedikt Hacker, Arthur Samuel, Mrs. Jeanne Simonnet, Miss Marie Helene Veil and Mrs. Nathalie Mas and her son Roger Denis Mas; Curt Dressler, residing at Brussels; and Matthias Arnold Hijman, interned at Westerbork, Netherlands, respectively, following is pertinent portion of note from Minister of Foreign Affairs E1 Salvador regarding afore- mentioned persons: QUOTE: The Government of El Salvador recognizes and will recognize the validity of the documents of Salvadoran nationality which the said persons possess until, in view of the fact that the files of its Consulates located in enemy territory cannot now be con- sulted, it decides to the contrary, if it should do so, and in its name, availing myself of the kind offer which you made me, I request, through your worthy medium, that Your Excellency's Government transmit the foregoing to the Department of Foreign Relations of Switzerland, as the reply of this Foreign Office concerning the documents in question. UNQUOTE. Please request Swiss Government to take appropriate action in this connection including addition of names given above to list of persons eligible for exchange. 5805. It is assumed that foregoing answers questions in your hull 816.012/9-444 SWP:ABC:BB 9-11-44 WRB CCA 195 CABLE TO ANKARA From War Refugee Board to Steinhardt Please deliver the following message to Leon P. Denenberg, American Consulate, Istanbul, from the International Rescue and Relief Committee: "Have been advised you made expenditures without approval of Embassy STOP Please comply with specific terms of license and rep rt your past and future expenditures to Ambassador STOP Replying your cable renew assignment in few days" THIS IS WRB CABLE TO ANKARA NO. 109 11:30 a.m. September 12, 1944 FH.lab 9/9/44 COPY NO 11 196 NOT TO BE RETRANSMITTED SECRET OPTEL No 298 Information received up to 10 A.M. 12th September 1944. 1. NAVAL Home Waters 11th. Enemy coastal batteries ineffectively shelled coastal Jonvoy off South Foreland. Mediterranean NICE harbour swept clear of mines and ready for shipping. On 6th/7th and 8th French cruisers and U.S. Destroyers bombarded batteries and troop concentrations near MENTONE. 9th. British ships shelled ammunition dumps and road junction at RIMINI. 2. MILITARY N.W. Europe U.S. forces have penetrated into BREST where street fighting is taking place. French troops on right of 3rd U.S. Army have made contact with French troops of 7th U.S. Army West of DIJON. 2nd British Army established a second bridgehead over ALBERT CANAL. Troops of First Canadian Army have reached ZEBRUGGE. Southern France West of SWISS Frontier French troops met heavy resistance 20 miles South of BELFORT On their left U.S. troops have advanced up to 10 miles along their whole front. 3. AIR OPERATIONS Western Front 10th. A.E.A.F. fighter bombers destroyed 153 M.T. 7th Armoured vehicles, 12 locomotives and 59 wagons. 10th/11th. Coastal Command aircraft damaged 1 cargo ship and left 2 armed trawlers on fire off Dutch coast and probably sank 4 minesweepers off SOUTH NORWAY. 11th. bomber Command dropped 857 tons HAVRE and 350 tons on/synthetic oil plants. 9 aircraft missing. Escorted U.S. heavies 3 dropped 1,026 tons on 7 sythetic oil plants in Central and Eastern GERMANY and CZECHOSLOVAKIA. 324 tons on targets at HANOVER and MAGDEBURG. 75 aircraft attacked works at CHEMNITZ and 365 attacked other targets. Enemy casualties reported 133:32:27 in combat and 42:0:46 on the ground for loss of 51 bombers and 41 fighters. In battle area 136 tons dropped on strong points near METZ and 93 tons ferry crossings N.E. of BRUGES. Fighter bombers also attacked enemy troops and transport. 11th/12th. 427 aircraft despatched principal targets DARMSTADT 240 (12 missing), BERLIN 47 (one missing), Sea-mining 76 (3 missing). Italy 10th. 702 medium bombers and fighters attacked military Bargets in ITALY and 107 operated over YUGOSLAVIA. MILITARY Italy In ADRIATIC Sector heavy fighting has continued From N.E. of FLORENCE to West coast Allied forces have made progress all along the line 197 TREASURY DEPARTMENT ASSISTANT SECRETARY Washington, September 13, 1944 MEMORANDUM FOR SECRETARY MORGENTHAU From: Assistant Secretary Sullivan ThS This noon at a luncheon in honor of National Commander Warren Atherton, I sat next to Frank Drake, President of the Gulf oil Company. He told me how much he had enjoyed your personal participation in the "We the People" programs and expressed the hope that the next time he was in Washington he might call to see you briefly. I am told that he and his company are unique in the oil industry in their whole-hearted support of the President ever since Pearl Harbor. PORDEFENSE BUY UNITED STATES SAVINGS BONDS MADSTANDS 198 PORVICTORY EXECUTIVE OFFICE OF THE PRESIDENT MA WAR REFUGEE BOARD WASHINGTON 25, D.C. OFFICE OF THE SEP 13 1944 EXECUTIVE DIRECTOR My dear Mr. Secretary: The policy expressed in the attached letter to Mr. Dillon Myer, Director of War Relocation Authority, was prompted by repeated demands made by farmers, farm agents and public agencies charged with the responsibility of recruiting labor. We trust that our action in handling this emergency meets with your approval. Very truly yours, Justice Pehle Executive Director The Honorable, The Secretary of Treasury Enclosure BUY 199 September 12, 1944 Dear Mr. Myer: As you know, both the War Refugee Board and the War Relocation Au hority have received many recent inquiries on the subject of the availability of the refugees at Fort Ontario, Oswego, for emergency seasonal employment. As I understand the situation, the farmers in the neighborhood as well as local public officials have indicated the acute and urgent need of emergency help in order to prevent the spoilage of important food crops that are currently being harvested and processed. After giving careful consideration to the matter, we have reached the following conclusions: 1. Whenever a general emergency exists and whenever the failure to provide labor will result in demonstrable injury to the war effort, we feel that the refugees should have an opportunity voluntarily to assist in harvesting and processing food crops under appropriate security controls. 2. The recruitment of refugees for emergency work should be done through the properly accredited agencies in the vicinity. 3. In each instance every effort should be made to insure that a real emergency exists and that the refugees are not being used to replace or compete with the normal labor supply in the area. 4. We believe that the refugees should return to the shelter every night during this present emergency employment. Sincerely yours, (signed) J.W. Pehle J. W. Pehle Executive Director Mr. Dillon Myer, Director War Relocation Authority Barr Building Washington, D. C. 200 O CABLE FROM WAR REFUGEE BOARD TO AMBASSADOR WINANT FOR MANN, LONDON. THIS IS WRB CABLE TO LONDON NO. 3 Please refer to your No. 7473 of September 11. The following cable No. of has been sent to Minister Harrison and McClelland in Bern: (Here take in full text of cable to Bern) We are unable to take any decision in the matter until we have received a reply from Bern. In the meantime, we assume that you will transmit to us any additional information that you may obtain. 2:05 p.m. September 13, 1944 JBFriednantro 9/13/44 201 London NS.796 This telegram must be paraphrased before being communicated to anyone other than a Government agency. (SECRET-0) Dated September 13. 1944 Rec'd 6:46 M.M., 14th Secretary of State. Washington. 7534. September 13, 9 p.m. FROM MANN FOR PEHLE, VAR REFUGES BOARD. Rene Reus and Albert Guigui to who license No. V-2215 was issued have received a telegram from Suzanne Lafellette and Sigmund Jeremias a paraphrase of which is as follows: "Transmitted for use only in occupied France as prescribed in Treasury license 75,000. The balance will be available only on your report War Refugee Board representative London Subasay on possible use in Occupied France. War Refugee Board representative London Enhassy should be consulted concerning refunding any unexpended balance to national war fund here. No relief activities in liberated areas permitted with funds transmitted under your Treasury license". The license in question does not restrict the expenditure of the funds to occupied France. Newever, the telegram in question appears to express as intent that funds be used in occupied France or else refunded. I feel that the sendere of telegram Standed to say occupied territory instead of Occupiot Frence. Quignt states that he has comsections through which he would be able to send funds into Germany where they would be used in an attempt to rescue persons deported from France because of political beliefs. He understands that any funds not excended in accordance with the license would be refunded to the donors. Please communicate with the senders of above telegram and confirm that there is no objection to using funds in any enery ecoupied territory and confirm that Board has no objection to contemplated use. Guigns expects more difficulty in obtaining consent of British for release of funds for purposes intended. Urgent reply requested as 1 have instructed his to take up matter with British immediately. WINANT VKB NPS 202 Department September 13, 1944 AMEMBASSY, LONDON 7438 Thirteenth FOR THE AMBASSADOR: With reference to your 7053 August 29 and 7455 September 11 kindly advise IGC that you will represent this Government on the new Executive Committee. Whenever necessary you may designate a substitute representative on the Executive Committee and so advise the Committee. With reference to your A-1065 August 31 it is suggested that Sidney Browne serve as the United States member on the Commission of Experts to draw up a form of travel document for stateless persons. If you agree, you may inform the IGC that he is so designated. HULL (GLW) WRB:GLW:OMH 9/13/44 202 Department September 13, 1944 AMEMBASSY, LONDON 7438 Thirteenth FOR THE AMBASSADOR: With reference to your 7053 August 29 and 7455 September 11 kindly advise IGC that you will represent this Government on the new Executive Committee. Whenever necessary you may designate a substitute representative on the Executive Committee and so advise the Committee. With reference to your A-1065 August 31 it is suggested that Sidney Browne serve as the United States member on the Commission of Experts to draw up a form of travel document for stateless persons. If you agree, you may inform the IGC that he is so designated. HULL (GLW) WRB:GLW:OMH 9/13/44 203 INCOMING TRLEGRAM BJR-766 PLAIN London Dated Sept. 13, 1944 Rec'd Midnight Secretary of State, Washington. 7555, Thirteenth CONFIDENTIAL LIMITED DISTRIBUTION ONLY FOR DEPARTMENT AND FEA British Treasury with approval of sub-committee on relief has agreed to make available to Poles 400,000 Swiss france for purchase of foodstuffs in Switzerland for shipment to civilians in Pruskow. It is anticipated that Poles will request similar amount from United States Treasury. Sub-committee recommends that money be made available. END would appreciate being informed of any action taken. WINANT WFS 204 CIRCULAR AIRGRAM TO AMEMBASSIES IN BOGOTA, CARACAS, CIUDAD TRUJILLO, GUATEMALA CITY, HABANA, MANAGUA, MONTEVIDEO, PORT-AU-PRINCE, QUITO, SAN JOSE, SAN SALVADOR, SANTIAGO, TEGUCIGALPA Reference ismade to our earlier commmunications on the subject of holders of Latin American documents in enemy territory. At suggestion of Swiss authorities and in order to safeguard the lives of holders of documents issued in the names of American republics in German-controlled territory, this Government is endeavoring to compile lists of such holders for transmission to the German Government. It is requested that you suggest to the government to which you are accredited the importance of immediately notifying the Swiss that such lists as may be handed to the latter by Amlegation, in so far as they relate to holders of do cuments issued in the name of the government to which you are accredited, may be accepted by Switzerland as authentic evidence that the persons named therein are entitled to treatment as nationals of an American republic and are eligible for exchange. In making this request, you may explain that the assurances previously given on behalf of this Government that the government to which you are accredited will not (repeat not) be expected to grant physical admission to the persons involved and that no (repeat no) objection will be raised to an examination by that government of status of such persons once they are safe from enemy persecution, fully apply to the persons whose names will be included on the lists herein envisaged. Should the government to which you are accredited, in addition to sending such communication, be in a position itself to compile and submit to Switzerland a list of holders of do cuments issued in its name or other persons under enemy control to whom it desires to give protection, this Government would be gald to extend to such persons the benefit of its activities intended to safeguard their lives. If . desired, this Govern- ment will gladly transmit any such list to the Swiss Government. 5:00 p.m. September 13, 1944 BAkzin:ar 9/12/44 205 CABLE TO AMEMBASSY, ASUNCION, PARAGUAY Reference ismade to our earlier communications on the subject of holders of Latin American documents in enemy territory. At suggestion of Swiss authorities, and in order to safeguard the lives of holders of documents issued in the names of American republics in German-controlled territory, this Government is endeavoring to compile lists of such holders for transmission to the German Government. It is requested that you suggest to the government to which you are accredited the importance of immediately notifying the Spanish government that such lists as may be handed to the latter by Amembassy, in so far as they relate to holders of documents issued in the name of the government o which you are accredited, may be accepted by Spain as authentic evidence that the persons named therein are entitled to treatment as nationals of an American republic and are eligible for exchange. In making this request, you may explain that the assurances previously given on behalf of this Government that the government to which you are accredited will not (repeat not) be expected to grant physical admission to the persons involved and that no (pepeat no) objection will be raised to an examination by that government of status of such persons once they are safe from enemy persecution, fully apply to the persons whose names will be included on the lists herein envisaged. Should the government to which you are accredited, in addition to sending such communication, be in a position itslef to compile and submit to Spain a list of holders of documents issued in its name or other persons under enemy control to whom it desires to give protection, this Government would be glad to extend to such persons the benefit of its activities intended to safeguard their lives. If desired, this Government will gladly transmit any such list to the Spanish Government. Repeat to Amembassy, La Paz, Bolivia. 5:00 p.m. September 13, 1944 BAkziniar 9/12/44 206 SECRET A.253 5:20 PM Sept. 13, 1944 AMEMBESSEY ASUNCION (PARAGUAY) The following is from War Refugee Board. Reference is made to our earlier communications on the subject of holders of Latin American Documents in enemy territory. At the suggestion of Swiss authorities, and in order to safeguard the lives of holders of documents issued in the names of American republics in German-controlled territory, this Government is endeavoring to compile lists of such holders for transmission to the German Government. A portion of a cable dated September 14, 1944 to the Legation at Bern follows: QUOTE With reference to lists of bearers of Latin American documents suggested in ultimate and penultimate paragraphs of your 5689, disturbed war conditions have interfered with communications between Latin American governments and their European missions, resulting in incomplete records which make the COM pilation of such lists difficult. However, to assist the Swiss in this matter it is believed that the Legation should endeavor to obtain with the aid of McClelland and the local representatives of organizations that have records on the subject, lists which are as complete as possible with a view to transmitting them to the Swiss authorities. The Department will suggest to various Latin American governments the urgency of confirming to Swiss authorities the authenticity of such lists. It is hoped, however, that in view of the humanitarian considerations involved and of this country's status as Power handling exchange of persons whose eligibility would be established by being placed on the list, Swiss officials will agree to transmit the lists to Germany even without such confirmation: UNQUOTE. Please discuss this matter with the Government to which you are accredited with a view of obtaining its confirmation of the authenticity of the list submitted by the Legation at Bern. In making this request, you may explain that the assurances previously given on behalf of the Government that the government to which you are accredited will not be expected to grant physical admission to the persons invloved and that ne objection will be raised to an examination by that government of status of such persons tonce they are safe from enemy persecution, fully apply to the persons whose names will be included on the lists herein envisaged. 207 Asuncion A-253 2 12 Should the government to which you are accredited, in addition to sending such communication, be in a position itself to compile and submit to Spain a list of helders of documents issued in its name or other persons under enemy control to whom it desires to give protection, this Government would be glad to extend to such persons the benefit of its activities intended to safeguard their lives. If desired, this Government will gladly transmit any such list to the Spanish Government. Sent to Asuncion. Copy to La Paz, Bolivia. HULL mmy AM-77 Please send copy to La Paz, Belivia. WRB:MMV:OMH 9/16/44 RPA NC SWP 208 CABLE TO HARRISON, BERN, FOR MoCLELLAND FROM WAR REFUGEE BOARD Board is receiving numberous urgent requests to take vigorous action on behalf of Jews in Slovakia whose position is reported to have seriously deteriorated without prior warning in recent days. Similar disastrous condition reported in fact or imminent in Hungary. With respect to Hungarian situation please consult Sternbuch in an effort promptly to secure the names and addresses of persons indicated in Department's WRB's 165. With respect to the Slovakian situation Union of Orthodox Rabbis reports further urgent pleas for money from the Rabbi of Neutra. Please endeavor to ascertain from Sternbuch the nature and such details as possible of the Rabbi of Neutra's project and, if, in your opinion and that of Saly Mayer such projeet is feasible and is reasonably calculated to save the lives of Jews is Slovakia, please extend to Sternbuch all possible assistance. To this end, you may in your discretion expend such portion of such funds as may be available to you and to request Saly Mayer to place at your disposal for such purpose such additional funds as you may require within the limits of what may be available to him. IF funds in excess of those presently available to you and Saly Mayer in Switzerland are needed for such operation, please ad'vise the Board at once. Nothing hereinabove contained should be construed as indicating that you may not in your discretion arrange to have Sternbuch discuss the Rabbi of Neutra's project with you and Saly Mayer jointly. JDC is in agreement. If, regarding any project you and Saly Mayer are not in agreement with respect to the expenditure of JDC funds, please advise the Board fully at once. Interested persons here assert that lives of group of Hungarian Rabbis and leaders now reported at Bergen-Belsen could have been saved while aboard train if funds had been sent to appropriate persons in Hungary. Would appreciate any comments you may wist to made and such information as there .may be availableto you with Yespect 'to' the present condition of said group. THIS IS WRB CABLE TO BERN NO. 169 10:20 a.m. September 13, 1944 FH:LSL:JWP:dg 9/12/44 209 MOST URGENT CABLE TO MINISTER HARRISON AND MCCLELLAND, BERN, SWITZERLAND. The following cable dated September 11 has been received from Ambassador Winant and War Refugee Board Representative Mann: (Here take in full text of No. 7478 of September 11 from American Embassy, London). We desire your considered judgment as to whether the German or Hungarian authorities have actually offered to permit 2100 or any other number of Jews to leave Hungary provided that they are taken to British or American territory. It is not possible for us to judge whether such a concrete offer has been made or whether the above quoted message from the British Minister in Bern merely represents the opinion of various agencies and individuals that the Germans might possibly be more willing to permit Jews to go to some territory other than Palestine. (See for example your No. 5579 of August 26). A specific answer to this question is necessary before this Government can take any decision in the matter, and a prompt reply from you will be appreciated. You will undoubtedly wish to inquire of the British Minister in Bern, the officials of the International Red Cross, and all other appropriate groups and individuals, whether they have any further information in the matter. 2:05 p.m. September 13, 1944 JBFriedman:ro 9/13/44 Miss Chauncey (For the Sec'y), Abrahamson, Cohn, DuBois, Friedman, Hodel, Laughlin, Lesser, Mannon, McCormack, Cable Control Files. THIS IS WRB CABLE TO BERN NO 170 210 LFG.623 Born This telegram must be paraphrased before being Dated September 13. 1944 consumicated to anyone other than a Government Agency. (RESTRICTED) Rec'd 5:43 p.m. Secretary of State Washington. 6038. September 13, 1 .. Department's 3001. August 31. Consensus of opinion among private Swiss Relief Committee members consulted is that effectiveness of Swies Refugee Advisory Commission in ocordinating and implementing work of various organizations handling refugee matters in Switserland has been very limited. It has had little effect either faverable or unfaverable on normal activities of different groups active in refugee questions here. The private Swiss relief organizations continue to meet regularly under aegis of Sentralestelle Fur Fluchtlingshilfe in Zurich and carry on their activities very much as before. It is generally felt that setting up of advisery commission was due to personal desire of federal council Lerves Steiger Chief of Department of Justice and Police, to lesson his own share of responsibility for handling of refugee problems in Switzerland and attenuate criticism directed particularly at him. Although announced that commission would convene at least once a month. February 23 meeting (Legation's 1130. February 24) has remained one and only full session to date. Several of its sub-committees have net. Sub-committee on legal questions has been fairly active mad settled cases of disciplinary action Bakes Say Swiss authorities against individual refugees. Sub-committee on emigration and repatriation had single meeting in July but took no action worth noting. In sub-committee on recreation and education official Swiss members, 1.0. officials of Federal Department of Justice and Police proposed series of lectures in camps en Switserland. Private members suggested instead lectures ea post war Europe emigration and the like as subjects of special interest to refugees at this moment but which had hitherto been ferbidies by Swiss authorities as centrary to Swise neutrality. This minor matter still being considered by authorities. JMS MARRISON 211 CORRECTION K Distribution of true September 13. 1944 reading only by special arrangement. (SECRET w) In telegram No. 1546, August 23. 5 p.m., from Aakara, in line 12 delete *(* and insert "to the" se as to read "leave Bulgaria by rail to the number of" at estere and in line 13 delete "the (*) tituted" and insert "these two beats or other ones substituted se as to read "trease ported by these two beats or other ones substituted for them" et estera. This advice is from Ankara. DIVISION OF COMMUNICATIONS AND RECORDS GAW 212 CABLE FROM THE WAR REFUGEE BOARD TO AMBASSADOR STEINHARDT AND HIRSCHMANN ANKARA, TURKEY Please refer to your 1594 of August 30, requesting the approval of the Board and the State Department of measures for the emergency relief of Jews in Bulgaria. It is not clear to the Board as to what is meant or contemplated by your reference to emergency relief and the Board would appreciate further details as to the measures which you believe necessary for the emergency relief of Jews in Bulgaria. THIS IS WEBCABLE TO ANKARA NO. XX 110. 2:20 p.m. September 13. 1944 213 CABLE FROM WAR REFUGEE BOARD TO AMBASSADOR STEINHARDT FOR AIRSCHAMANN, ANKARA, TURKEY. Reference your 985 of May 31. Please advise whether the War Refugee Board has any obligation resulting from the negotiations for the use of the S.S. Tari. If so, please state extent of the obligation and suggest the best procedure for liquidating the claim. THIS IS WRB ANKARA CABLE NO. 5:00 p.m. September 13, 1944 MJMarks shind 9/13/44 111 . 214 AVR Distribution of true reading only by special September 13, 1944 5 D.M. arrangement. (SECRET w) AMEMBASSY ANKARA 796 The following for Steinhardt is WPO 109. Please deliver paraphrase of the following message to Leen P. Denemberg. American Consulate, Istanbul. from the International Rescue and Relief Committee: QUOTE Have been advised you made expenditures without approval of Enbassy STOP Please comply with specific terms of license and report your past and future expenditures to Ambassador STOP Replying your cable re new assignment is few days. UNQUOTE HULL WRB:10KVKK NM (GLV) 215 LFO-746 Ankara This telegram must be paraphrased before being Dated September 13, 1944 Rec'd 11:40 p.m. communicated to anyone other than a Government Agency. (RESTRICTED) Secretary of State, Washington. 1728, September 13, 6 p.m. FROM HIRSCHMANN TO PEHLE FOR JOSEPH SCHWARTZ OF JDC Ankara's No. 154. Reference is made to Passman's 170 which I have discussed with him. I conour with his recommendation that the JDC discontinue its contribution to the Jewish agency beginning October 1. STEINHARDT WFS WPL 216 COPY NO NOT TO BE RE TRANSMITTED SECRET OPTEL No. 299 Information received up to 10 A.M. 13th September 1944 1. NAVAL OSTEND Harbour entrance blocked by about 14 ships and approaches mined At DIEPPE 10,949 tons stores have now been unloaded. Aircraft of the Home Fleet have laid mines off NORWAY. A 4,500 ton ship was attacked and an escorting minesweeper sunk. 2. MILITARY In Burope Third U.S. Army in the MOSELLE Valley have made another crossing of the river south of NANCY. Further north U.S. troops crossed German border 6 p.m. 11th and are now in the area N.W. of TRIER. BASTOGNE and ETTLEBRUCK in LUXEMBOURG have been taken. U.K. bridgehead over ALBERT CANAL North of BEERINGEN enlarged and new crossing of the MEUSE-SCHELDT junction canal made. Bridgehead across ALBERT CANAL at GHEEL unsuccessfully counter attacked by Germans. West ofGHENT, LOCKEREN and ST. NICOLA have been taken and Dutch border crossed north of latter. Canadians have established a bridgehead across GHENT-ABRUGES canal and have reached coast at WISSANT and SANDGATE near CALAIS. LE HAVRE has fallen. Southern France U.S. troops have reached the vicinity of VESOUL and French have occupied DIJON. Italy Slight advances have been made south of FIREN-UOLA and VERNIO and towards VIAREGGIO. Rumania Russians have occuped MERCUREA-CIUCULUI, ADJUD, S and DEVA. 3. AIR OPERATIONS Western Front 11th/12th. DARMSTADT 868 tons, very good results. BERLIN 54 tons. 12th. 786 escorted heavy bombers dropped 2236 tons on 9 synthetic oil plants in GERMANY and CZECHOSLOVAKIA, 348 MUNSTER railway station, 133 KIEL Aero-engine works, 150 MAGDEBURG Ordnance Works and 632 on other military objectives. German casualties 53:14:41. Ours 52 heavy bombers, 19 fighters missing. Medium bombers dropped 64 tons on bridges between DUTCH ISLANDS. and mainland and on SAARBRUCKEN railway centre. 335 tons dropped on fortified positions south of aircraft, (2 missing) successfully attacked shipping off Holland Two ships set on fire and others damaged by rockets. 12th/13th. 891 aircraft despatched, (25 missing), AACHEN and rear NANCY with very good results. Coastal command TRANKFURT 387, STUTTGART 217; BERLIN 29 Mosquitoes; other missions 258. Mediterranean 10th/11th. Heavy bombers from MEDITERRANEA dropped 123 tons on railway centre MILAN with good results. 11th. 762 medium bombers and fighters attacked communications etc. Italian battle area while others attacked ports in the ADRIATIC, the GULF OF GENOA and YUGOSLAVIA 12th. Escorted Liberators and Fortresses dropped 811 tons on an airfield and 2 aircraft ractories Southern Germany. 25 bombers, 1 fighter missing. 217 September 14, 1944 10:20 a.m. Mrs. Klotz: Yes. HMJr: Hello. K: Hello. HMJr: Yes. K: Mr. Morgenthau, I'm in your office. HMJr: Hello. K: Hello. Can you hear me? HMJr: No, I don't hear you. k: Hello. Operator: There must be something wrong. Just a second. HMJr: Hello. Operator: Go ahead. K: Hello. HMJr: Yes. K: I'm in your office. HMJr: Yes. K: Dan Bell hasn't returned by I wanted to get that information for you so I've got Glasser and Joe DuBois here and they have some for you. HMJr: K: Ah -- you'll have to talk very loud. All right. Now -- hello? HMJr: Yes. K: Can you hear me now? HMJr: Just about. 218 -2K: Oh, that's -- there must be something the matter with the line. HMJr: Well, maybe you've got the electric thing on. K: Just a (Remainder of conversation not recorded.) 219 September 14, 1944 3:07 p.m. 0 HMJr: Dan. Dan Bell: Yes. HMJr: I can't hear you. Pick up the White House phone and ask them to give it to you on that connection. Try that phone. B: All right. HMJr: On the White House phone. B: Just ask them to switch it, huh? HMJr: Yeah, tell them to switch it. I can't hear you. B: All right. 220 September 14, 1944 MESSAGE FOR SECRETARY MORGENTHAU: Lord Cherwell is Professor of Physics, Oxford. He has great ability. Personal friend of Prime Minister for many years and through that friendship became advisor on scientific matters. Arthur likes him personally but says he is not popular at Oxford because he is more interested in politics than scientific work. In last war he did remarkable work on airplanes and showed great courage in doing experiments himself. Is strong Conservative and has individual influence but not popular generally. 221 Prof. Goodhart: Lord Cherwell is a Professor at Oxford. His name before he came Lord Cherwell was Londerman. He is a Professor of Physics and a man of great ability, and he is a very intimate friend - personal friend of the Prime Minister. He has inown him for years, and it was through that friendship that he became his advisor on scientific matters, and he has been advising him very closely on all sorts of matters like that. Mrs. Klotz: What do you think of him personally? Goodhart: Oh, I think very highly of him. He is a man of great ability. Klotz: You think a great deal of him? Goodhart: Yes. He isn't very popular at Oxford because he is more interested in politics than in scientific work. But he is considered in the last war he did some very remarkable work on airplanes, and he showed great courage in doing the experiments himself. Klotz: I see. Goodhart: He is supposed to be almost the Prime Klotz: Minister's most intimate friend. Yes. Well,.you.know.the Secretary is. up there and has seen him and he wanted to know what you thought of him. Goodhart: I like him myself. He is personally very influential. 222 1944 SEI 14 PM 12 46 o WU28 10 NSR NEWYORK NY SEPT 14 1944 1230P K MRS KLOTZ CARE SEC MORGENTHAU US TREASURY GENTLEMAN MENTIONED STRONG CONSERVATIVE INDIVIDUAL INFLUDENCE BUT NOT POPULAR GENERALLY ARTHUR GOODHART. 1245P TOP SECRET 223 RECORD OF CONVERSATION BETWEEN THE PRESIDENT AND PRIME MINISTER AT QUEBEC ON SEPTEMBER 14. 1944. The Prime Minister said that when Germany was overcome there would be a measure of redistribution of effort in both countries. He hoped that the President would agree that during the war with Japan we should continue to get food, shipping etc. from the United States to cover our reasonable needs. The President indicated assent. He hoped also that the President would agree that it would be proper for Lend/Lease munitions to continue on a proportional basis even though this would enable the United Kingdom to set free labour for re-building, exports, etc., e.g. if British munitions production were cut to three-fifths, U.S. assistance should also fall to three-fifths. The President indicated assent. Mr. Morgenthau however suggested that it would be better to have definite figures. He understood that munitions assistance required had been calculated by the British at about 3 billion dollars in the first year on the basis of the strategy envisaged before the OCTAGON TOP SECRET TOP SECRET -2- 224 Conference. The exact needs would have to be recalculated in the light of decisions on military matters reached at the Conference. The non-munitions requirements had been put at 3 billion dollars gross against which a considerable amount would be set off for reverse Lend/Lease. The President agreed that it would be better to work on figures like these than on a proportional basis. The Prime Minister emphasized that all these supplies should be on Lease/Lend. The President said this would naturally be so. The Prime Minister pointed out that if the United Kingdom was once more to pay its way it was essential that the export trade, which had shrunk to a very small fraction, should be re-established. Naturally no articles obtained on orsold imputed Lend/Lease or identical thereto would be exported; but it was we C essential that the United States should not attach any conditions to supplies delivered to Britain on Lend/Lease which would jeopardize the recovery of her export trade. The President thought this would be proper. TOP SECRET 225 -3 TOP SECRET To implement these decisions the Prime Minister suggested there should be a joint committee. It was held that it would be better to appoint an ad hoc committee for this purpose on an informal basis in the first instance which could be formalized in due course. Pending its report the United States departments should be instructed not to take action which would pre-judge the committee's conclusions, e.g. production should not be closed down without reference to Lend/Lease supplies which it might be held should be supplied to Britain. The President thought that the committee should be set up and suggested that Mr. Morgenthau should head it representing him, and that Mr. Stettinius, who had taken such a large part in Lend/Lease, should also be a member. ok +IR ml 15.9 TOP SECRET 226 TOP SECRET K 1. We have discussed the question of the scope and scale of rutual Lend/Lease aid between the United States and the British Empire after the defeat of Germany and during the war with Japan. We have agreed that a Joint Committee shall be set up to consider this question with the following membership:Chairman: American Members: British Members: Secretary Morgenthau Under-Secretary Stettinius Mr. Leo Crowley 2. The Committee will agree and recommend to the Heads of their respective Governments the amount of Mutual Aid in munitions, non-munitions and services which is to be provided for the most effective prosecution of the war. The Committee is instructed to obtain from the various branches of the Governments whatever pertinent information is necessary for TOP SECRET 227 o TOP SECRET -2- . the preparation of their recommendations. 3. Pending the recommendations of the Committee to the Heads of the respective Governments, the appropriate departments of each Government shall be instructed not to make any major decision with respect to the programmes of Lend/Lease Aid for the period referred to above without the approval of the Committee. 4. In reaching its conclusions the Committee will be guided by the conversation between the President and Prime Minister on September 14th, 1944. M. Quebec. September 14th, 1944. wh 5.4 TOP SECRET Mr. Histon 228 (COPY) THE SECRETARY OF THE NAVY WASHINGTON 14 September 1944 My dear Admiral Waesche: You may continue to provide a Coast Guard plane for the transportation of the Secretary of the Treasury within the United States as you have heretofore provided under a directive of Secretary Knox. Sincerely yours, (Signed) FORRESTAL James Forrestal Vice Admiral Russell R. Waesche The Commandant United States Coast Guard Room 7006, 1300 E. St. N.W. Washington, D.C. 229 25 September 14, 1944. Dear Mr. Graniki For the Secretary. I an acknowledging your letter of September 11, which enclosed a number of reprints of the American Form of the Air broadcast covering the Brotten Woods Conference. Mr. Morgenthan is new ons of the city, but just as soon as he is back as his desk, I shall be glad to give these to him. I know that he would wish - to thank you for your courteey in soeing that he nocolved these copies, and in offering additional 0308 If be should wish to have them. Sincerely yours, Hemitta S. Klatz H. S. Klots, Private Secretary. Mr. Theodore Granik, Director, The American Form of the Air, 1687 K Street, N.V., Washington s. D. c. GEF/dbs 230 THE AMERICAN FORUM OF THE AIR COAST TO COAST MUTUAL BROADCASTING SYSTEM 1627 K ST. N.W WASHINGTON 6.D.C. METROPOLITAN 0010 THEODORE GRANIK DIRECTOR September 11, 1944 Dear Mr. Secretary: Following up my letter of August 28, I thought you might be interested in receiving reprints of the program on "The Meaning of Bretton Woods." Six copies are being sent to you under separate cover. If you desire additional copies, I shall be happy to make them available. Sincerely yours, The Honorable Henry Morgenthau, Jr. Secretary of the Treasury Washington 25, D. C. # DEDICATED TO DEMOCRACY'S IDEAL - THE FULL AND PUBLIC DISCUSSION OF ALL SIDES OF ALL ISSUES 231 THE AMERICAN FORUM OF THE AIR Vol. 6 AUGUST 22, 1944 No.33 "The Meaning of Bretton Woods" HENRY MORGENTHAU, Jr. Secretary of the Treasury HARRY D. WHITE Assistant to the Secretary of the Treasury DEAN ACHESON Assistant Secretary of State SENATOR CHARLES W. TOBEY New Hampshire, Ranking Republican Member. Senate Banking and Currency Committee E. E. BROWN President. First National Bank of Chicago, and President of the Advisory Council of the Federal Reserve System Ransdell Inc. Printers and Publishers Washington, D.C. Copyright 1944 by THEODORE GRANIK. Director of the American Forum Announcer Ed Studney: The American Forum of the Air! Good eve. ning, ladies and gentlemen. From the famous Shoreham Hotel in Wash. ington, D. C., Mutual is proud to bring to its millions of listeners one of radio's pioneer public service features, the American Forum of the Air. Since founding this institution sixteen years ago, Chairman Theodore Granik, attorney and editor, has arranged these weekly broadcasts in which the news personalities of the day discuss the issues of the day, openly and frankly, in the American tradition of free speech This is democracy in action. And now, Chairman Granik world. That is what we are going to talk about in this Forum discussion here this evening. To my mind, the most important fact about the Bretton Woods Conference, more important even than the agreement reached by the forty-four participating nations, was the spirit in which men from many different lands approached a problem which they knew they could solve only through cooperative action. They knew from the tragic experience of the two decades which followed the last World War that if their countries tried again to achieve economic security through separate national action, they would achieve in the end only economic chaos and economic aggression. And they knew that these lead inevitably down the road to war. The alternative to economie cooperation is economic warfare. And economic warfare is but the initial phase of armed conflict. They met, therefore, determined to uproot at least this particular cause of the frightful tragedy through which the world is now passing. They met with faith in one another's good will and with faith in their common capacity to solve a common problem. They met determined to find a solution. And although the solution was not easy, they found it. This is a hopeful augury, I think, for the important security conference which opened today at Dumbarton Oaks here in Washington Men have learned at last that the hopes that they share can best be realized by a Chairman Granik: At Dumbarton Oaks here in Washington, the major nations are drawing the blueprints for an international organization which will make for a durable peace. World security, we have come to know, depends in large measure upon economics. Trade balances, import and export restrictions, international loans and currency exchange are major factors. It was natural, therefore, that the nations of the world should consider monetary matters before they took up security. An International Monetary Conference was called last month at Bretton Woods, New Hampshire, and forty-four nations sent delegations. From that Conference emerged two proposals: an International Mone. tary Fund and an International Bank for Reconstruction and Development. These are merely proposals which must be accepted by the govern ing body of each of the forty-four nations, just as our own Congress must agree on behalf of the United States. joining of their hands. At Bretton Woods we agreed upon two instrumentalities to help one another toward a secure and stable economic world an International Mone- tary Fund and an International Bank for Reconstruction and Develop- The proposals are in the technical language of diplomacy and economics which few Americans have been able to understand Yet this Fund and Bank may have a profound influence on world stability for generations. For this reason, the American Forum of the Air is planning several discussions on the Fund and the Bank. To lay the groundwork for forum debate on the merits of these plans on subsequent programs, we have asked the American delegates to explain this evening "The Meaning of Bretton Woods.' Unfortunately, not all of the delegates were able to join us. We are, however, honored by the presence of: HENRY MORGENTHAU, JR., Secretary of the Treasury. SENATOR CHARLES W. TOBEY, of New Hampshire, ranking Republican member of the Senate Committee on Banking and Currency. DEAN ACHESON, Assistant Secretary of State, E. E. BROWN. President of the First National Bank of Chicago and President of the Advisory Council of the Federal Reserve System. DR. HARRY D. WHITE, Assistant to the Scerebary.of.the Treasury. Secretary Morgenthau, will you. as President of the Conference. tell MS generally about Bretton Woods? ADDRESS BY HENRY MORGENTHAU, Jr. A month has passed since the United Nations Monetary and Financial Conference at Bretton Woods, New Hampshire, came to its successful conclusion. We have had time to study the accomplishments of that meeting and to weigh their meaning for our security and prosperity in the post-war TWO ment. Some of the American delegates to the Conference are here tonight. I think it would be helpful if they were to give you their impressions of what was accomplished. Chairman Granik: Now, Dr. White, one of the things that I have discovered about the Bretton Woods Conference is that very few people under$ stand either the Fund or the Bank. They feel that the agreements are written in such technical language that the ordinary man in the street can't understand them. Now, I would like you in a few words to describe the Monetary Fund. DR. WHITE: Well, stripped of its technicalities, the Fund is an international organization set up to achieve new high levels of world trade. These we must have if we are going to have full employment after the war. Now, the Fund helps to bring this about by doing three things: First, it will help an orderly adjustment of exchange rates immediately after the war and provide for stability of exchange rates thereafter, so that exporters and importers will be able to buy and sell without running the serious dan- ger of large losses from unanticipated exchange fluctuations Secondly, the Fund will prevent competitive exchange depreciation which does so much to disrupt trade and eventually helps to bring about depression. Thirdly, it will prevent and seriously cut down those exchange discriminations and controls which serve to stifle trade and foreign investment. SENATOR TOBEY : In other words DR. WHITE: I have just another word I would like to add. In order to bring these three things about, the Fund necessarily has to have some THREE pretty large resources and pretty broad powers, and the Fund is equipped with those resources and those powers. SENATOR TOBEY In a nutshell, then, Harry, the Fund provides international machinery for stabilizing the values of foreign currency and for playing the financial game fairly in the field of foreign trade and commerce. If countries which are fulfilling these obligations get into trouble, the Fund stands ready to make its resources available to help them over this erisis, DR. WHITE: Yes. It has, as I said, very large resources amounting to almost nine billion dollars for the purpose of helping those countries adjust their trade in an orderly manner. SENATOR TOBEY: And there will be no more resorting to sharp practices such as depreciating currencies, imposing restrictions on the payment of goods they have bought from other countries, and all the other tricks which Nazi Germany played upon the world. Is that right DR. WHITE: Yes, it was precisely those practices which contributed so much to the depression of the '30s and eventually to the war. Chairman Granik: Dr. White, / think the public is just as foggy about the Bank as they are about the Fund. I would like to hear a similar explanation of the International Bank for Reconstruction and Development. DR. WHITE: Why don't you take the Bank, Dean That's your bailiwiek. MR. ACHESON I think the Bank is a much simpler institution than the Fund and it ought to be an institution which every American can understand. Every American has a bank in his own town and he understands how it works. The primary purpose of the Bank is to make capital avail. able from those countries which have capital to countries which want to borrow for purposes of reconstruction and development. Now, in order to do this, each country subscribes to shares in the Bank, just as every stock holder subscribes to shares in a company or bank in our own towns in this country. Part of that subscription is paid in so that you have cash available for operation. The greater part of it, however, is not paid in. The greater part of it is a guarantee to make good losses in case the bank ineurs losses. In that way the bank is equipped with capital. Now, one of the most important things about the operation of this Bank is that the Bank does not compete with private investment. The Bank will guarantee loans which private investment companies make. MR. BROWN: Dean, don't you think you ought to point out that the Bank loans money or guarantees money. only. for the purpose of providing for an exchange needed in connection with a reconstruction or development DR. WHITE: Ned, I think it is, but, Ned, I think you would be interested in the conference that I had with a couple of representatives of one of our largest producers in this country of heavy export goods. They wanted to know precisely that question; they wanted to know if the Bank made large loans what assurance was there that they wouldn't spend those loans in their own countries on local services and local products, and I pointed to the provision in the Bank which provided precisely for the point you made, in other words that the funds, which would be provided in the form of foreign exchange, are for the purpose chiefly of purchasing imports Chairman Granik: Dr. White, just what is the relationship between the Fund and the Bank? DR. WHITE: Well, they are two very separate institutions. They are, of course, interdependent institutions in the sense that the proper funetioning of one would help in the proper functioning of the other, but the Bank is designed, as Dean says, to provide long-term capital for reconstruction and development, and the Fund, of course, merely provides for stable exchanges and for orderly conduct of international trade. MR. ACHESON: Well, Harry, one of the things that I hear people saying is that if you have the Bank you don't need the Fund and if you have the Fund you don't need the Bank. Now it seems to me that the exact opposite of that is true. DR. WHITE I should think so. I should think that they both are needed to supplement each other. They both perform very essential functions on different aspects of trade and capital. MR. BROWN Well, it is very evident, it seems to me, that the Bank, by providing funds to pay for capital imports such as machinery of a country which wants the machinery in connection with a new project, makes it much easier for that country to maintain its normal balance of trade and pay for its current imports. DR. WHITE: Yes, I think there is that connection between them in addition to the other one. MR. BROWN: It certainly reduces the temptation or the pressure on a country to use the Fund for purposes other than maintaining the value of its currency in purely normal exchange transactions: Chairman Granik: It is said the Fund will be given certain powers to bring about changes in trade policies and that we may be forced by the Fund to lower our tariffs. Senator Tobey, what do you think of this? SENATOR TOBEY: I would say that the Fund has nothing to do with the project ? tariff policy. The question of shaping the tariff policy is exclusively a MR. ACHESON That is quite right. MR. BROWN: It requires, does it not, that the local expenses for labor and local materials be raised by the country in which the project is located. without recourse to the Bank SENATOR TOBEY And amplifying what Dean Acheson and Ned Brown have just said. I would add that loans in which the Bank is interested would matter for Congress to determine. The Fund makes no provision and no reference to questions of tariff policy. DR. WHITE: Wouldn't you say, none the less, Senator. that an appropriate tariff control would help in the proper functioning of the Fund as well as the Bank SENATOR TOBEY I certainly should, and I might add there that we Republicans, and Democrats as well, must learn the fundamental lesson that if nations are going to buy from us. we must be willing to take their goods in return in payment. be only for the purpose of rebuilding industries, public utilities, and so forth, in war devastated countries, and developing natural resources and industries in under-developed countries, Is that correct FOUR FIVE DR. WHITE: In other words, then, neither the Fund nor the Bank is a substitute for a proper commercial policy. SENATOR TOBEY: That is correct. MR. ACHESON They are all part of one much larger policy. Wouldn't you say that is truel DR. WHITE: Yes, I think that it is important to emphasize both those points, that a proper commercial policy will help very greatly in the proper functioning of the Fund and the Bank and the proper utilization of the Fund and the Bank will make more easy an appropriate commercial policy. Chairman Granik: Secretary Morgenthau, one newspaper writer has called the Bretton Woods plan an international WPA. How do you feel about that? Did you find that the foreign countries were motivated by what they thought they could get out of the United States through the Fund or the Bank, or did you find a spirit of real cooperation evident? SECRETARY MORGENTHAU: The Fund has nothing to do with either re- lief or rehabilitation. These are the responsibility of UNRRA. The Bank is intended to finance sound and productive reconstruction projects. They are no more WPA projects than are the loans of any private bank. They will help self-respecting peoples to get back on their feet economically and thus to buy the goods which we produce. As to the spirit which motivated the representatives of these peoples at Bretton Woods, I think I shall ask Senator Tobey to give you his reactions. SENATOR TOBEY: Well, Mr. Secretary, in my judgment the most outstanding and encouraging feature of Bretton Woods was the sincere spirit Bank and the Fund. I was very greatly impressed, as I know all of you were, by the ability that was shown by the representatives of the other American republics, t e way in which they took hold of these questions and contributed very essential ideas, and above all, perhaps, by the way in which they came forward in their subscriptions to the Bank. I thought that the Western Hemisphere did a very fine job. Chairman Granik Mr. Brown, there has been a lot of talk that the United States dollars in the Fund will become exhausted and then the Fund break down. MR. BROWN: I don't think there is very much to that. In the first place, not all the countries in the Fund are going to use its credit facilities Certainly a great number of countries, such as South America, even countries like France and Holland which have been invaded, have got large gold and foreign exchange resources and they are going to use those up first they are going to keep their ability to borrow from the Fund or have recourse to it as an ace in the hole, and they don't really expect to use it in the near future. DR. WHITE: Even if they do, that is precisely what the Fund is for if they should find themselves up against an unanticipated emergency in which they have to draw upon the Fund, that is exactly what the Fund is there for. MR. BROWN: Exactly. It seems to me it is like a reserve account or a line of credit with a bank, something which even if you don't use you are of cooperation and understanding of the meaning of the word "inter- glad to know is there. dependence,' and it is an example, in my judgment, and pardon my saying this, of cause af effect, for it is generally admitted and conceded by all who were there that the air and the climate and the beauty of New Hampshire prevailed upon the souls of men up there. Chairman Granik: Cannot these safeguards be removed or waived? What obligation is there for the United States to replenish dollars? MR. ACHESON: Hear, hear! DR. WHITE: Is it true, Senator, that you are the Senator from New Hampshire SENATOR TOBEY I admit that. As to the WPA, Mr. Secretary, let me point out that loans will be made only to pay for materials which the nations borrowing must import; therefore, no country will be able to operate a domestic WPA on loans made by the Bank. MR. BROWN I would like to point out also that a great many countries, such as Canada, and others, which normally don't expect to use either the credit facilities of the Fund or the Bank. crime to and did their part be cause they knew and felt that the reconstruction and development of the rest of the world would help them not only in their foreign trade, but by making for a more prosperous world would also greatly remove the danger of future wars. DR. WHITE: I don't think there was a single country there that didn't appreciate the fact that future prosperity depended upon the creation of some such agencies, and because they felt that, they were all perfectly willing to participate in a spirit of cooperation and desire to get results. MR. ACHESON As I was going to say, I would like to add my word to that, particularly because I think we were all very much pleased and gratified by the attitude of our neighbors in this Hemisphere toward both the SIX MR. BROWN In the first place, the country can only draw 25 percent of its quota in any one year. In the next place, there are various provisions in the Fund which require a country whose balance of payment position improves and which gets more gold and foreign exchange to pay it back into the Fund. With all those considerations I don't think the dollars are going to run out if we maintain a proper trade policy. MR. ACHESON: That is what it all gets back to, Ned, what Senator Tobey was saying a few moments ago, that we have got to have a realization that if we want to sell we have got to buy and that you cannot have over a long period of time a complete disequilibrium of the income and outgo of a country. more than of an individual. MR. BROWN I think that is absolutely correct. You can take gold for a while but the gold gives out, and you can loan money for a while but you get tired of doing that, and ultimately if you sell you have got to receive payment, and you can only receive payment in goods, but even if we should maintain a policy of restricting imports and encouraging exports, we would have done a great deal to build up the world, and while we might have our money frozen for a time in the Fund, I don't believe that with the safeguards that we could lose any considerable portion of it. although there might be some delay in getting it out. SENATOR TOBEY Well, Ned. a recent critic of the Fund came out and charged us with an adventure in world altruism. I rather accept that SEVEN challenge. I think this old world of ours could stand a dose of altruism in place of the world-wide cynicism that has prevailed so often in past years. Chairman Granik: On that topic, Mr. Secretary, we have heard it said that if the United States joins the Fund and Bank we will be throwing our money away. How about it? SECRETARY MORGENTHAU: To date this war has cost the American people over 200 billion dollars In order to set up the Bank and Fund, this country is asked to invest 6 billion dollars, which is less than the war costs us each month. Moreover, there is no reason to believe that we shall lose this investment. Every possible precaution was taken at Bretton Woods to protect both institutions against loss and to insure them against abuse. The investment should be returned to us many times over in a revival of trade. The Bank and the Fund will help preserve the peace for years to come, and for that reason alone they are well worth our invest- ment in them. SENATOR TOBEY: Well, Mr. Secretary, I coneur (and it bears reitera- tion) that we are putting in a total investment or subscription into the Fund and Bank of 6 billion dollars for world peace and prosperity, but over and against that we are putting out in war expenditures each month 7 billion dollars for death and destruction. DR. WHITE: Well, Senator. you speak of spending money on war. I think it needs to be emphasized that this is an investment and not an expen- diture. The 6 billions that you put in here you will get back, and with interest. MR. ACHESON That is the point that I wanted to emphasize, too, the one that Harry just brought out. It seems to me a very strange criticism to come from Americans that foreign investment is throwing money away, or, as I have heard some people say, throwing money down a rat-hole. If any country in the world has ever benefited from foreign investment it has been the United States of America, and I think that the investors have benefited too, and what both of these plans mean is that the same benefits which have been extended to this country in the past are going to be extended to other countries in the future. DR. WHITE: Not only are the benefits going to be extended to other countries, but quite obviously our own exporters and manufacturers and own labor are going to benefit by such extension of credit. This is not an organization that is set up to benefit other countries, but rather ourselves as well, MR. ACHESON: suppose every transaction in which you loan money and borrow money is carried out for the profit of both the lender and the borrower, otherwise it wouldn't take place. DR. WHITE: That is right. Chairman Granik Mr. Brown. there is a good deal of talk about how the Fund and the Bank will affect American foreign trade. I would like to get your views. MR. BROWN Well, in the first place, the Fund means that an American exporter can count on being paid in a currency which he can convert into American dollars. That's a great and immediate advantage. In the second place EIGHT DR. WHITE (Interposing): Without any risk of loss of exchange, either. MR. BROWN: Without any risk of loss of exchange and without the danger of the currency being blocked while it is outstanding. In the second place, it means that an American exporter needn't fear the loss of all his exports to a country which suffers a temporary depression caused by something like a crop failure, because that country has got a right of access to the Fund and can continue to buy until conditions change again. SENATOR TOBEY: Well, Ned, right there, on the pernicious practices you spoke of, isn't it a fact, to use an illustration, that debasements of currencies and radical fluctuations in exchange rates bring about economic upsets, economie upsets bring about depressions, depressions bring about unemployment, and when unemployment comes in, and bitterness and hatred and discouragement in the hearts of men, it is fertile soil for a Hit- ler to thrive again Isn't that exactly the history of the past MR. BROWN: That is precisely it. SENATOR TOBEY We don't want history to repeat itself along those lines. MR. BROWN Certainly the Fund prevents a country from discriminating against American goods, against the use of its dollars in exchange for its currency, and that was a practice used by a good many other countries I think the Bank loaning money to foreign countries for projects of development does two things: In the first place, a great many of the dollars that are loaned will be spent for the purchase of machinery and goods in the United States; they don't have to be so spent. DR. WHITE: Suppose they are not spent in the United States, Ned: suppose Greece borrows and spends it in England. Don't we get the advantage in the end MR. BROWN: Certainly the dollars all come back. Suppose we loan money to Brazil to build a railroad ; it might buy and would buy a lot of the rails and a lot of the locomotives and signal equipment in the United States, but it might buy some in England or in Belgium, but it would use the dollars that it borrowed from the Bank and got from us or from American investors whose loans were guaranteed by the Bank, in England, and England in turn would use those dollars to buy cotton and other goods coming from the United States. DR. WHITE: In other words, the dollars would come right back here and our exporters would get the benefit. MR. BROWN Certainly. They might not be directly tied up but we would get the benefit completely and entirely of all the money that was loaned by the Bank. Chairman Granik: I would like to ask Secretary Morgenthau this. Mr. Secretary, wouldn't the establishment of the Fund mean more Government control over foreign trade? Is it true, as some state, that if we adopt the Fund, foreign trade will have to be taken over by Government agencies? How about that? SECRETARY MORGENTHAU: No. the exact opposite of this is true. I should think that the Bank and the Fund were absolutely essential for American foreign trade. So far as the Fund is concerned. the Fund grves NINE assurance to the American producer who wishes to sell his goods abroad that he can find a medium of payment for those goods which will be stable and predictable. To workers and manufacturers it means that people abroad will be better able to buy materials which they produce. SENATOR TOBEY: The United States leaves its traders free to buy and sell where they please and operate under the rules of free competition. This right can be effective only if other countries do not restrict the freedom we give our traders, The United States can insure such freedom only through international cooperation. DR. WHITE: Well, don't you think it is a little more than that, Senator? So far as the American trader is concerned, the exporter and the importer, he probably won't even know of the existence or the operation of the Fund and the Bank except in so far as he realizes that he is able to buy and sell without running the risk of any exchange fluctuations and except as he is aware of the fact that foreign trade is higher than it has ever been. SENATOR TOBEY He wants ways and means to do business MR. ACHESON: That is a point, I think, we ought to make very clear first of all, that there is absolutely nothing whatever either in the Bank or the Fund which enables either one of those institutions to direct or control or interfere with private initiative or private traders in any way. DR. WHITE: It just sets a setting in which he can go ahead and do more business at a higher profit. MR. ACHENSON All that the private trader knows is that there is an opportunity for a great deal more business than there otherwise would be, but it is left to him to carry out the business in any way which he thinks best. Chairman Granik Speaking of investments abroad, Mr. Brown, since the Bretton Woods Conference I have had a number of business and bank. ing leaders ask me how the proposed Fund and Bank will affect existing investments abroad, and also the war debts and lend-lease, MR. BROWN Well, directly it will not affect them because neither the Fund nor the Bank is set up for the purpose of taking care of past debts, whether private or inter-govermental. The Fund is set up for the purpose of insuring that payments on the current account will be met promotly, and the Bank is set up to encourage the investment of new capital and to provide that that new capital will be repaid, but both by promoting the trade and prosperity and the production of export goods by the country coneérned will make for a situation in which it ought to be possible for countries to much more readily pick up and catch up on old and defaulted debts. DR. WHITE: In other words, Ned, that even though the Bank and the Fund are designed to inerease trade in the future and to increase the flow of foreign investments in the future. it is fair to say that with the increased prosperity that comes from that, many countries will be able to resume servicing some of the debts they are in partial or whole default on. MR. BROWN: I think that is unquestionably so. I have never known of country which hasn't wanted to pay its indebtedness if it could. a SENATOR TOBEY: Ned. not the least of the results of the Bretton Woods Conference was the fact that we produced unity among the different delegates from the different nations Now, in my judgment (I twink you will TEN coneur) that constitutes a good-will account which will be a very real asset in international banking. Isn't that your view! DR. WHITE: I don't know how you feel about that, Ned, but I think it is even more than that. One of the provisions in the Fund calls for a reduction in the exchange control on the withdrawal of profits that are earned by corporations that either have investments abroad or that own plants abroad, and one of the consequences of the adoption of the Fund will be that those corporations cannot only be assured that they will be able to withdraw the profits that they earned, but they will have the further assurance that any additional investment that they place there they will be able to withdraw when desired. MR. ACHESON: In other words, both the Bank and the Fund are look- ing to the future. They are not pieking up and trying to liquidate old debts. They are trying to increase the flow of business in the future, and as you increase that flow and as there is more trade and more prosperity, then the chances of paying off old debts increase, but the thing to do is to keep your eye on the future and not on the past. DR. WHITE: Yes. None of the resources of either the Fund or the Bank are going to be used to bail out bond-holders who may have bonds in default. Chairman Granik I would like to come back to Mr. Brown. Some of the criticism of the Fund and the Bank has come from bankers. Some are wondering whether this may be because the Fund and Bank would compete with the banker or take business away. Would that be the case, Mr. Brown? MR. BROWN I don't think so at all. In the first place, I want to negative the idea that all bankers are opposed to the Fund and the Bank. A great many bankers are in favor of both. Chairman Granik: How about your own bank? MR. BROWN: Well, I am certainly in favor of it, and I think that anything which increases the volume of our export business is bound to increase the profits of banks. It isn't so much the mere handling of foreign exchange, although there will be more of that than before and more of it handled through banks, but a higher level of prosperity in this country means more loans for the banks, more deposits, more transactions, more business, and more profit. Chairman Granik: Mr. Acheson? MR. ACHESON: I.was going to .add to what. Mr. Brown said that of course he is much closer-t business men than we are in the State Department, but we have people coming in all the time who are asking about what the possibilities are of trade, what the policy is in the future toward trade abroad, and this seems to me to be one of the great answers. DR. WHITE: Well, not only do business men feel that way, but speaking of the bankers, they are displaying a far greater interest in both proposals. They are forming committees to study the proposals ; they have asked for conferences with us to have us explain some of the details of the Bank, and they are giving every evidence of having a sincere and intense interest in the Bank, not merely because they may have greater profits, but because. as Ned Brown says, they are interested in helping to achieve international prosperity. ELEVEN SENATOR TOBEY: As a matter of fact, Harry, going back to the epoch of the Conference itself a month ago at Bretton Woods in New Hampshire, the New York Herald-Tribune financial writer sounded a warning note to all the banking interests of the country, who were at that time without full knowledge of the subject, critieizing it in general, and he said it might be wise to go a little slow on the eritieism of the Conference and its results until we know something more about it. It is my honest opinion that when the banks and investment houses of this country get the full import of what we did at Bretton Woods they will be wholeheartedly for it. DR. WHITE: There is no question of that, because basically both the Fund and the Bank mean more business and more jobs. Chairman Granik: Senator Tobey, it is frequently objected that the United States will have only a minority voice in the new Fund and the Bank. As one who for some years has been a minority-party member of the Senate, are you afraid of the United States having only a minority voice in the proposed institutions? SENATOR TOBEY Not at all. I am so sold on international cooperation on banking lines and every other line that I am perfectly willing that the United States as the largest nation. the nation that will reap the largest benefits, should be willing to participate. After all, our total investment is less than 6 billion dollars, and if it were all lost it would cost us less than this war is costing us each month. MR. BROWN I think everybody should remember that after the United States, the United Kingdom has the largest single interest in the Fund, and when you add the votes of the United States and those of the British Empire, and countries like Holland, Belgium and Norway, together, you have got an assurance that a group of people who think fundamentally alike on economic questions are going to have the majority vote and are going to rule the Fund. DR. WHITE: Well, even if they don't think alike-it may happen, you will admit, wouldn't you. Ned, that the British Empire and the United States might not think alike on some of these problems but even if they don't we have a third of the votes and we are not likely to take any position which is not going to be reasonable, and if we take a position that is reasonable we are going to have a lot of other countries who are going to vote along with us, South America, North America, and places outside the British Empire, so that in no sense would we ever be in the position of having only a minority of votes, I should hope. SENATOR TOBEY And furthermore, Harry, some of the most vital provisions require for their adoption a vote larger than a majority. DR. WHITE: That is right. SENATOR TOBEY: And some of the countries have veto power. DR. WHITE: That is right, and not only that, but one of the provisions provides for increasing voting power of the countries whose funds are being used mostly and that. of course, would be the United States. whereas other countries who are resorting more to the Fund have less voting power; so that in fact our voting power is in excess of a third MR. ACHESON: But the same thing is true in the Bank, Harry: you have provisions in the Bank by which you cannot raise funds in a country without the consent of that country. TWELVE DR. WHITE: That is right. MR. ACHESON Therefore, it isn't a question of what the control is in the Bank: you simply can't raise funds in the United States, the United Kingdom, or anywhere else without the consent of that country. DR. WHITE: In other words, you can say we have complete control over the use of dollars in the Bank. MR. ACHESON Entirely so. Chairman Granik: Some of the Congressional critics of the Bank have argued that since the United States is going to be the principal country in a position to furnish the goods for reconstruction in the early post-war years, and since this means that the United States dollar will have to be furnished to buy these goods, there is no point to having an International Bank with a lot of countries deciding when the loan dollars. Why not enlarge the Export-Import Bank so that it can make loans for reconstruction and development and run it ourselvest DR. WHITE: I think we should. We should enlarge the Export-Import Bank because it performs a very necessary function in financing exporters and other certain projects on a short-time basis, but the people who make that criticism completely misunderstand the nature of the Bank. The function of this Bank is to provide long-term investment, and, what is more important, to do so without having the entire risk fall on the American taxpayer. MR. BROWN I think that last point is highly important. The United States subscribes about a third of the total capital of the Bank, the rest of the world subscribes two-thirds. The American investor who loans his money is guaranteed by the whole world, two-thirds by the countries other than the United States, and beyond that I think that any country is much less likely to default on an obligation when the loss caused by that default is going to fall on every other country in the world than it is to default a loan held or guaranteed by one single other country. DR. WHITE: But if it does default (and some of these loans, I think you will concede, Ned, are apt to be risky in the post-war years) the American taxpayer bears only a portion of it instead of the whole of it, as he would bear if the Export-Import Bank made the loan. MR. ACHESON There is one point I would like to add to that. It is quite right that the risk is one-third United States, two-thirds the rest of the world, but this eritieism that the United States ought to run the Bank itself or put up all the money and run it itself seems to me a very strange criticism, and I don't know what party the "people belong to who make that eriticism. We have seen in the last week the correspondence between Mr. Hull and Governor Dewey in which it is perfectly clear that both major parties in this country are not going to stand for any policy by which there is dietation on the part of the United States, with or without any other country, to the rest of the world. There is going to be cooperation. Countries, large, small, are going to be brought in, and their views are going to be asked and their cooperation is going to be sought. That is exactly what was done at Bretton Woods, exactly what Governor Dewey and Mr. Hull on have agreed should be done at the conferences at Dumbarton Oaks. Chairman Granik: Secretary Morgenthau, since we first announced this broadcast we have received many letters from American workers and THIRTEEN from soldiers asking this one very simple question: Will the Bank and Fund mean anything in the way of jobs for Americans after the war? I think this is one of the questions that is on the minds of a lot of people. SECRETARY MORGENTHAU: The Bank and the Fund will mean a great deal in the way of jobs for Americans. With the Bank and the Fund in operation, our export business, our sales of machines and equipment and consumer goods to other nations will be vastly increased. For example, the Germans made it a point to destroy or remove all electrical generating equipment in Italy. When the war is over, the Italian Government will have to replace this equipment. They may go to the Bank to borrow money. They will then look around to see where they can buy new generating equipment, and the chances are very good that they will buy it right here in the United States from General Electric or Westinghouse, for example. The money they pay for these will thus come back into the pockets of American workers. Actually, the difference between the jobs that would exist in the United States if we have a high level of trade as against those that would exist if we have a low level of trade may make a difference of five to ten million jobs. SENATOR TOBEY To bear that out, Mr. Secretary, wouldn't you agree that an increase in our foreign trade will mean an increase in our national income, and as our purchasing power increases, production expands and more jobs are created here at home? SECRETARY MORGENTHAU: That is the way it works, Senator. Chairman Granik: Senator Tobey, as ranking Republican member of the Senate Committee on Banking and Currency, you will have an important role in any Congressional legislation on the Bretton Woods plan. Do you find that this is a subject on which Congressmen are divided along party lines, Democratic and Republican! SENATOR TOBEY I see no reason why they should be so divided. I think it is for the substantial good of the American people, and they certainly can't make a political issue out of it. There was no polities involved in consideration of the matter at Bretton Woods, and it would be a great mistake to inject polities into it now. I was pleased the other day (and I think it was a true statement) with the statement in the New York papers quoting Governor Edge of New Jersey as stating that Governor Dewey had come out saying he favors stabilization of the world financial situation. lute imperatives. The first of these is that we must help the peoples of these war-torn lands to rebuild their homes; we must help them to begin again the industry and agriculture through which they will be able to play their parts in a healthy revival of commerce throughout the world There can be no lasting security or prosperity for any of us unless this is done. But beyond this is the broader imperative that we must stamp out the basic causes of this fearful scourge of war. The Fund and the Bank devised at Bretton Woods are instrumentalities for mutual aid amongst nations and for the creation of economic order. But they are, of course, no more than first steps toward the goal we seek. They must be buttressed by many other measures of international cooperation in the economic and military spheres. Peace is not a static concept. It is a dynamic condition to be preserved, as it is attained, only through ceaseless effort, only through a constant guard against the viruses that would destroy it. The agreement achieved at Bretton Woods stands as an irrrefutable demonstration that men who choose to live at peace with one another are capable of finding ways to do so. Chairman Granik: Thank you, Mr. Secretary. You have been listening to the American Forum of the Air discussion on The Meaning of Bretton Woods," Our speakers: Henry Morgenthau, Jr., Secretary of the Treasury; Senator Charles W. Tobey, of New Hampshire, ranking Republican member of the Senate Committee on Banking and Currency; Dean Acheson, Assistant Secretary of State: E. E. Brown, President of the First National Bank of Chicago and President of the Advisory Council of the Federal Reserve System; Dr. Harry D. White, Assistant to the Secretary of the Treasury. Your letters and comments are welcomed And now your announcer, Ed Studney. Announcer Ed Studney: Thank you, Mr. Granik. The American France and have what. the wer is doing there, What do you think the Forum of the Air is directed by Chairman Theodore Granik, attorney and editor, who founded this institution sixteen years ago. Be sure to listen next week at this time to a discussion of Labor in Politics" by Representative Joe Starnes of Alabama: Representative War. ren G. Magnuson of Washington; Mr. Robert J. Watt, International Rep. resentative, American Federation of Labor: and Mr. James B. Carey, See***ary-Treasurer of the CTO. SECRETARY MORGENTHAU: There is nothing academie about the problems and proposals we have discussed tonight. Tonight's broadcast originated in the Shoreham Hotel, Washington, D. C. You are cordially invited to attend any of these broadcasts Admis. sion is free- no tickets are necessary. Chairman Granik: Secretary Morgenthau, you have just returned from Fund and Bank mean in terms of world peace? I have just come back from a visit to the battlefront in France. I have seen at first hand what it means to a country to serve as a battlefield in modern war. Vast areas have been literally pulverized. Whole populations have been uprooted I also spent several days in London I have seen what four years of Nazi bombings and the more recent use of robot bombs have done to that city and to the entire face of the British Isles. One cannot see such sights, I think, without acknowledging two absoFOURTEEN For reprints of tonight's American Forum of the Air discussion on The Meaning of Bretton Woods,' write to Ransdell Inc., that isR-A-N-S-D-E-L-I-Ransdell Inc., printers and publishers, Washington 18. D.C. Please include ten cents to cover handling and mailing and allow two weeks for delivery. This has been presented as a public service by the Mutual Broadcasting System through Station WOL. This is Mutual. FIFTEEN Treasury Department 232 Division of Monetary Research Date Sept. 27, 194419 0 TO: Secretary Morgenthau I think you will be interested in reading this letter from Mr. Friedman, in China. white H.D.W. see hage #mg Done MR. WHITE Branch 2058 - Room 214-1/2 1hml 233 SECRET COPY September 14, 1944 Dear Mr. White, Thank you for sending me on that trip to Kunming and Chengtu. It was a very interesting and stimulating experience. I am sorry that I was unable to write to you during the trip because of inadequate mail facilities, i.e. I could send mail but the censors insisted at these places that they would have to read it, which is not done here. The big news in Chungking these days is, of course, the seemingly inevitable fall of Kweilin and Luichow, a major air base to the south of Kweilin. The Japanese have already advanced beyond Lingling, capturing or making unuseable many of our best bases in Eastern China. It was from these bases that the 14th Air Force carried out its successful sweeps against Japanese shipping off the China coast and effectively bombed Japanese strong points on Formosa. There are many theories prevalent as to why the Japanese are making the drive at this time and they range from purely military onea such as the desire of the Japanese to delay and make more difficult an American landing on the China coast to such highly political ones, such as that this campaign is part of an understanding between the Central Government in Chungking and the Japanese whereby the Japanese are destroying the most effective center of anti-Chungking feeling outside of the Northwest In this connection, you may find the following incident of some interest. When in Chengtu, I visited Dr. Mei, the President of Yengching University and, I understand, a loyal supporter of the Chungking Government who has at times been used for "confidential missions". Making 234 -2conversation, he said to me, "of course, you have heard the rumors going around town that the Generalissimo is conducting peace negotiations wi th the Japanese". I said nothing, not having heard the rumor, but tried to look wise and receptive. Dr. Mei went on "These rumors are not true, but even if they were true, the Gen. would only be doing it to amuse himself." It seems, however, that the fall of Kweilin at this time will not have the dramatic effects that were anticipated in late June and early July. By now, the edge seems to have been taken off the defeat while = everywhere I went, Japanese successes prior to the fall of Hengyang were openly described by the Chinese as a "national disgrace", the present Japanese successes are being shrugged off as inevitable and as being more than counterbalanced by Allied successes in Europe and the Pacific. The People's Political Council meetings are of course getting considerable publicity. The Central Government has seemingly, under public pressure, allowed the Council greater freedom of discussion than in last year's meeting. There has been particular criticism of the conscription methods used by the Central Government and just prior to the meetings the head of the conscription administration was removed. There has also been discussion of widespread corruption in administration, with special attention to corruption and abuses in collection of land tax in kind. The discussion on financial situation was held in executive session. The Chungking Government seems to be following the policy of removing the sting from the expected criticism by having Minister after Minister openly confess the sins of his administration prior to their di scussion by the Council members. According to reliable sources, the 235 -Communists are going to raise the question of Communist-KMT relations at an open session, i.e. press present, and lay before the Council a dossier giving the complete history of the negotiations which are now stalemated. The Communists are displeased with the Generalissimo's speech which was taken as an open attack on them in his emphasis on need for abolition of independent armies. The bargaining position of the Communists would seem to have been considerably strengthened by the U. S. military mission to the Northwest. Not only has the State Department been receiving most enthusiastic reports from its representative with the mission, Jack Service, but the military men who have gone up and come back speak nothing but the highest praise for the Yenan people. They seem to be literally astounded by the CO- operation which they are getting, the eagerness of the people there to learn from the Americans, the relative physical comfort in terms of good, clothing and shelter and the general atmosphere of good-will. Mac Fisher, head of the OWI here has also gone up to study psychological warfare possibilities. The U. S. military men here are vying for the opportunity to go up. there and see the situation for themselves. In this general atmosphere of increasingly outspoken criticism of the Chungking Government and growing popularity among Americans here of Yenan Government, the Chungking Government is said to be on verge of making some concessions to the People's Political Council: give Council the right to examine the budget, expand membership from 240 to 290, and have next assembly consist of representati ves elected by provincial assemblies. 236 -4You will be interested to know that in that part of discussion on inflation reported in English-language press, the entire blame for sharp rise in prices in early part of 1944 was placed on Chengtu project - which of course, is a gross exaggeration and merely another example of how the Chinese try to make us the scapegoat for their mistakes and failings. Many of the U. S. military people here expect that if Kweilin falls, the fault, according to the Chinese, will be the Americans. The Nelson-Hurley visit is now in full swing. I had an interesting talk with Nelson and his assistants which was brought to an abrupt end by the entry of General Hurley. At the press conference here, Nelson was very cautious as long as Hurley was present, but as soon as Hurley left, Nelson opened up and spoke quite frankly about his difficulties in Washington and his conflict vd. th the Army on reconversion. In Kunming, there was considerable bitterness and criticism of the Mission, on the grounds that it strengthened the position of the Central Government at a time when it was rapidly losing prestige and power. There was similar criticism of the attention given to Dr. Kung, particularly the invitation to address the Senate. The sitdation 'in'Kunming is of considerable importance. There the Governor, Lung Yung, is outspokenly critical of the Central Government and was quick to point out in talk with Consul General and myself that while his provincial troops were not "provincial" troops but actually "national" troops, they were not "Kuomintang Party" troops! The Central Government is not able to exercise effective control in this area so that you find outspoken criticism of it in the press and in conversation. Thus, Lung 237 -5 Yung, a provincial war-lord surrounded by opium-smuggling and opiumsmoking henchmen, becomes the guardian of the liberals and democrats! There is much hinting at open opposition to the Chungking Government and secret contact has been established between the Communists and the Lung Yung-liberal combination, but, nevertheless, you get the impression that anything like open opposition will not come in the very near future, unless the lead is given by developments in other areas such as the setting up of a separatist government in the South-east of China. In Chengtu, the situation is even more abscure. There the Governor is a strong Kuomintang supporter but real control rests in the hands of local war-lords nominally friendly to the Central Government. As in Yunnan, these war-lords, who also engage in such things as opium smuggling, seem to feel that their hope for survival lies vl th their being "popular" and again you have them protecting outspoken critics of the Central Government. The most important of these groups is the Young China Party which, in the Chengtu area, is largely a party of landlords who have seemingly never forgiven the Communists for the treatment they accorded these landlords on their way to the Northwest back in 1935. There is no outward evidence of a Communist movement in the Chengtu area, but I understand that plans are being executed for establishing contact between the dissident groups in Yunnan and those in Chengtu region and that this will be effected during the next few weeks. This can all be accomplished vL thin the framework of the Federation of Democratic Parties which is non-communist, prodemocratic reform and anti-Chungking. 238 -6- Kunming was also interesting because it is a center of U. S. military activity. Air traffic over the "hump" is now well over 20,000 tons per month and when I was in Kurming, it was at the rate of nearly 32,000 tons per month, or probably twice as much military supplies as ever came over the Burma Road, but still just a few Liberty boatloads. I should, perhaps, point out here that the 14th Air Force is a very impressive organization. With a force of only about 15 thousand men, as of July 15, they had destroyed over one million tons of Japanese shipping, had inflicted well over 16 thousand casualties on the Japanese (16,000 is figure for Hengyang campaign alone) and had shot down over 2 thousand Jap planes against about 200 U.S. planes lost. While the Chinese are doing ineffective dying in Southeast China and on the Salween, the Americans are doing effective fighting everywhere in Free China. I picked up a few tidbits on my trip which were quite interesting and I would like to pass them on as I feel they are quite revealing as to the present situation, although they might be considerable exaggerations. The Chinese forces on the Salween are repeating the oft-told tale of corruption; starvation and disease due to callousness and mismanagement by the top. military people; useless. slaughter of heroic. troops under the command of men totally ignorant of military warfare; defeatism in the high command to a point of a psychological inability to realize that Chinese troops properly fed, equipped and led can defeat Jap troops; soldiers sent into battle against superior numbers of Japanese troops because no Chinese commander will risk the major portion of his troops in any one engagement; soldiers sent into battle with insufficient training and not instructed to crouch or dig fox holes because such protective measures -- 239 would mean loss of face; soldiers making futile and costly frontal assaults in daylight; Chinese losing 3 to 1 against the Japs, while Merrill's Marauders killed 60 to 1; Chinese commanders insisting on bringing in more troops than planned for, thus upsetting at the last moment carefully laid plans; American advisors being ignored except to be asked question--how soon could the necessary supplies be made available? These are not my thoughts but rather the opinions given to me by high ranking American officers who had just returned from the Salween front. These are some stories they tell: When the Chinese forces came to the Salween, the American engineers estimated that it would take them about 4 days to build a bridge across the river. It took the Chinese seven weeks, for a month was spent convincing the Chinese command that a bridge should be built. The Chinese command opposed the construction on the grounds that if a bridge was built the Japanese could use it in a counter-offensive aimed at capturing Kunning. The Chinese on the Salween were shelling one of the many highly publicized Jap points of resistance. One Sunday an American GI decided to go for a stroll through the town and did 30. He saw some dead Japanese and picked up some souvenirs in true American fashion and calmly walked through the town as though on a Cook's tour. He didn't see any live Japanese or any evidence of such. After he returned and reported his rather extraordinary experience, the Chinese continued to shell the town and a week after this incident still hadn't stormed the town. As for the famous battle of Sungshan mountain in which the Chinese dislodged the Japanese from the top of this mountain, the Chinese kept asking for more and more dynami te until General Dorn finally asked 240 8- why so much dynamite since he had given them enough for a campaign. They showed him the plans of attack and, in the words of the teller of this story, their plans called for tunneling through this mountain practically at its base. When the day came for the big blow off, every coolie in the Salween knew about it. Finally the charge was exploded, while the Chinese withdrew to a safe distance. After the smoke had cleared the Japanese were found to have moved out of their pill-boxes into the craters conveniently made for them by the explosion and the battle went on. According to one informan', the Japanese have only 4,000 troops preventing the reopening of the Burma Road and the progress that is being made is more the result of Japanese deliberate withdrawls than Chinese pressure. It is said that the combat efficiency of these troops as compared with Americans is about three percent. (I hear in Chungking that the Japanese are now sending reinforcements into Northern Burma.) The stories I heard about the North China (Honan) campaign were, if anything, even worse. I will give you one - when it was recommended to General Chow Cheh-jou that the Chinese Composite Air Wing bomb a concentration of Jap tanks in one of the rail centers before the Honan campaign really got under way, General Chow felt that this. would be,a misuse of his air power which should instead be saved for the battle. The net result, as told to me, was that the same airmen had to seek out these same tanks in groups of 2 and 3 when they were scattered throughout the countryside and spear- heading the Japanese drive, instead of getting them all in a bunch. I have more of such tales but I'm afraid that I've already given you more than enough to make the point. The others can be had for the asking. 241 ORIGINAL TEXT OF TELEGRAM SENT FROM: Secretary of State, Washington DATE: American Embassy, London September 14, 1944 NUMBER: 7485 TO: CONFIDENTIAL In addition to your No. 7473 of September 11 we have transmitted the following cable No. 3185 of September 14, to Minister Harrison and McClelland in Born: We desire your considered judgment as to whether the German or Hungarian authorities have actually offered to permit 2100 or any other number of Jews to leave Hungary provided that they are taken to British or American territory. It is not possible for us to judge whether such a concrete offer has been made or whether the above quoted message from the British Minister in Bern merely represents the opinion of various agencies and individuals that the Germans might possibly be more willing to permit Jews to go to some territerry other than Palestine. (See for example your No. 5579 of August 26). A specific answer to this question is necessary before this Government can taken any decision in the matter, and a prompt reply from you will be appreciated. You will undoubtedly wish to inquire of the British Minister in Bern, the officials of the International Red Cross, and all other appropriate groups and individuals, whether they have any further information in the matter. We are unable to take any decision in the matter until we have received a reply from Bern. In the meantime, we assume that you will transmit to us any additional information that you may obtain. THIS IS WRB CABLE TO LONDON NO. 3. HULL 242 KEM-150 Distribution of true reading only by special arrangment. (SECRET W) Caserta Dated September 14, 1944 Rec'd 7:00 a.m., 15th. Secretary of State, Washington. 386, September 14, 9 a.m. FOR WAR REFUGEE BOARD FROM ACKERMANN. NO. 110. Heathcote Smith, Intergovernmental Committee, has suggested probable propaganda approach which is sub- mitted for Board's consideration. He urges that declaration be issued by Roosevelt and Churohill while at Quebec that all denationalized or stateless persons be declared under political protection of United States and Great Britain and that this be publicized by every means together with other statements similar to President's statement March 24. As precedent he refers to statement Churchill June 1940 which offered British citizenship to Frenchmen. He urged if possible that matter be presented to both men while they are still meeting. Since status of pretege is one of grace that must be recognized by sovereign powere I have little hope that Germans will officially recognize such status but it might be effective in lower brackets. In any event it is opinion of both Smith and myself that a final propaganda effort be made immediately possible along lines suggested my letter September 7. KIRK WTD 243 CABLE TO NORWEB, LISBON, FROM WAR REFUGEE BOARD. Please deliver the following message to Robert Pilpel from M. A. Leavitt, American Jewish Joint Distribution Committee: QUOTE PLEASE INSTRUCT SALY MAYER PAY ADDITIONAL 114,000 SWISS FRANCS ACCOUNT ZEEV WULF SZYND UNQUOTE THIS IS WRB CABLE TO LISBON NO. 92 5:00 p.m. September 14, 1944 RDrury 9/14/44 244 CABLE TO NORWEB, LISBON, FROM WAR REFUGEE BOARD. Please deliver the following message to Robert Pilpel from M.A. Leavitt, American Jewish Joint Distribution Committee: QUOTE HAVE ASKED RESNIK SECURE NAME RELIABLE PERSON SOFIA AND HE WILL NOTIFY SALY MAYER THEREOF DIRECTLY STOP ABRAHAM ABRAMOVIC WAS FORMERLY MINOR JDC EMPLOYEE BERLIN OFFICE NO OTHER INFORMATION AVAILABLE ABOUT HIM UNQUOTE THIS IS WRB CABLE TO LISBON NO. 91 5.00 p.m. September 14, 1944 RDrury 9/14/44 245 CABLE TO NORWEB, LISBON, FROM WAR REFUGEE BOARD. Please deliver the following message to Robert Pilpel from M. A. Leavitt, American Jewish Joint Distribution Committee. QUOTE IN ALL FUTURE CABLE MESSAGES SUCH AS YOUR 105 AND 109 RELATING TO ENEMY OR ENEMY OCCUPIED COUNTRIES, UNTIL SUCH COUNTRIES ARE OFFICIALLY DECLARED NON-ENEMY OCCUPIED PLEASE USE THE FACILITIES OF THE WRB AND DO NOT (REPEAT NOT) SEND SUCH CABLES THROUGH COMMERCIAL CHANNELS UNQUOTE THIS IS WRB CABLE TO LISBON NO. 93 5:00 p.m. September 14, 1944 R Brury 9/14/44 246 Lisbon OP-862 Distribution of true Dated Sentember 14, 1944 reading only by special arra agenent. (SECPET w) Ree'd 10:52 p.M. Secretary of State Washington 2864, September 14. 11 a.m. WRB 188 Pertuguese Foreign office, while sympathetic Immenitarism aims expressed Nabassy's notes 498. August 17 and 515, August 31. feels it impossible to admit refugees falling in classifications outlined Department's telegrame 2118, July 28 and 2332, August 24 without more effective guarantees from United States that all of these people, whether given US visas or not, will be speedily removed from Pertugal by US if admitted. Ministry and government fear end of war and consequent decline US interest. Sepcifically object to statement that recipients of US visas after July 1, 1941 will only be admitted to the US subject to US immigration law and other limitations. Also object to indefiniteness of statement that US will evacuate these not given US visas as seen as possible. Desire US guarantee definite time limit on stay in Pertugal for all coming under classifications DEPTEL 2118 and 2332. Also statement regarding specific country which has in advance accepted those unable secure US visas. and guarantee transport for evacuation of all wire and non-visa within comparatively short period. If above requirements impossible to meet, and they seen very fornidable, doubt if Pertugal will take affirmative action above notes. Babasay is asked for definite written guarantee along above lines. NORWER JT 247 o Lisbon LFG-993 Distribution of True Dated September 14. 1944 reading only by special arrangement. (SECRET v) Rec'd 6:12 p.m. Secretary of State, Washington. 2875. September 14. 5 p.m. THIS IS WHO 189. ThisMabassy has given much thought to the question of destination for refugees admitted to Portugal in accordance with terms of Enbassy's notes 498 August 17 and 515 August 31. Would 18 perhaps be possible to send those who do not receive American visas to Camp Fedhala? Further REEMBS telegram 2864. September 14. This might mean postponement of liquidation of camp but come such definite arrangements seems only possible way to secure affirmative action from Portugal. WSB NORVES 248 FBM-980 Distribution of true reading only by special Lisbon Dated September 14, 1944 Rec'd 5 p.m. arrangement. (SECRET -II) Secretary of State, Washington. 2876, September 14, 5 p.m. WRB 190. Mexican Government has granted visas for five families, eleven individuals, and airgrams have been sent by Consular Section with complete data for transit visas for each. In all except one case data sent over month ago - earliest eight weeks. Despote statements URTELS 1819, June 25 and 1820, June 26 that case should be processed in week, no visas or replies have been received here. This creates bad impression by Mexican Legation as all these cases were of special interest to Minister and may discourage granting further visas. All individuals are in imminent danger imprisonment and, deportation. Please attempt discover and remove present obstacles. NORNEB JT 249 BJR - 77 Lieben reading only by special Dated September 14. 1944 Distribution of true arrangement (SECRET w) Rec'd 9:59 pl m. Secretary of State, Washington. 2882, September 14, 7 p.m. WRB 191 FROM DEXTER FOR PEHLE Think most everything pending could be cleared by December first OF earlier, provided Mexican and United States transit visas for Spanish Republican refugees here are received seen. Please push. One ship for Palestine definitely arranged for October and second pending. By December or earlier Hungarian refugee question will be cleared one way or other. Refugees remaining here must be left to care of private organisa- tions as neither UNRRA nor IntereGeveramental Committee function in Pertugal. REURTAL 2493, September 12. Therefore suggest December first as date for conclusion WRB activities, although earlier date may be possible for Dexter if he were urgently needed elsewhere. Widen should probably stay Bill December first and Dexter would gindly. 12 desired give her guidance in clearing deaks if he were available. Terminus ad quen depends largely on speed arrival Mexican and United States transit visas and possibilities transport. Thanks notification Unitarians of Dexter's and Widen's availability. If one or both not needed in Burope will make plans to return United States early December. Sincerely appreciate words of thanks for services. NORWED JT 250 B&R - 154 PLAIN Lisben Dated September 14. 1944 Rec'd 8:56 a.m. 15th Secretary of State. Washington. 2883, September 14. 7 p.m. FOR LEAVITT FROM ROBERT PILLEZ JDC 75 WRX 193. Spanish Beat Company reseged on Palestine veyage Pertuguese beat SS GUINS carrying 400 scheduled sail October 1st have letter which Companhia Colonial has written breker and expect close formally next days. GUINE will carry all Palestine certificate holders Pertugal Spain numbering about 300 and about 100 from Tangier group. RR NORWER 251 ORIGINAL TEXT OF TELEGRAM SENT FROM: Secretary of State, Washington EO: American Legation, Born DATED: September 14, 1944 NUMBER: 3180 CONFIDENTIAL Following for McClelland. 1. Reference is made to your 5689 of August 31. In replying to Swiss notice of August 26, please ask Swiss political department to emphasize that the German arguments notwithstanding, this Government is unable to recognize anyright of the German authorities to pass upon the validity of documents issued in the name of other sovereign governments. Furthermore, none of the American republics upon whose docuemtns this German procedure is being practiced can, in justice to their own proper interests, allow that practice to go unquestioned. Accordingly, this Government insists on the stand taken by it in Department's 2490 of July 21 paragraph two and rejects as irrelevant any attempt by German officials to question the validity of Latin American do cuments whether on the basis of antecedents of Jews involved or of the type of identity papers or on any other basis. It should be emphasized in this connection that German attitude was at first to doubt the eligibility of persons involved for exchange and the acceptance of docuentns involved by issuing governments. Now that eligibility for exchange has been confirmed and the several issuing governments have notified Germany through protecting powers that the documents holders must be protected nowithstanding any doubts as to the validity of the documents, Gorman.officials introduce new excuses for their failure to comply. All these excuses are emphatically rejected by this Government and the attention of German officials involved is drawn to the serious consequences of their attitude. In this connection, please advise whether you have been able to convey to proper quarters the message contained in paragraph three of Department's 2490 of July 21. It is believed that in the light of the military situation it is possible to away German officials by confronting them with a sufficiently emphatic statement of this Government's position. With reference 252 -2With reference to lists of bearers of Latin American documents suggested in ultimate and penultimate paragraphs of your 5689, disturbed war donditions have interfered with communications between Latin American governments and their European missions, resulting in incomplete records which make the compilation of such lists difficult. However, to assist the Swiss in this matter it is believed that the Legation should endeavor to obtain with the aid of McClelland and the local representatives of organizations that have records on the subject, lists which are as complete as possible with a view to transmitting them to the Swiss authorities. The Department will suggest to various Latin American governments the urgency of confirming to Swiss authorities the authenticity of such lists. It is hoped, however, that in view of the humanitarian considerations involved and of this country's status as Power handling exchange of persons whose eligibility would be established by being placed on the list, Swiss officials will agree to transmit the lists to Germany even without such confirmation. You may include in such lists the persons envisaged in Department's 2407 of July 13 para- graph numbered six. Precaution should be taken, however, to inform Swiss and German authorities that such lists cannot be considered complete. Should Germany inquire of Swiss Legation or government whether any particular individual not appearing on such lists is protected by Switzerland, it is suggested that an answer along the following lines would be both substantially correct and calculated to save human lives: Owing to wartime conditions, Swiss records regarding citizens of countries under Swiss protection are incomplete and so are records of several Latin American legations in Bern; if Germany would inform Switzerland of the claimed nationality of the person involved, inquiry will be made of the government of the country concerned; and the Swiss will consider it understood that pending receipt of an. answer. to such inquiry such person will. be treated.a and accorded all the rights and privileges of a citizen of the country whose nationality he claims. 2. The following information received from Amembassies in varidus countries is transmitted for McClelland's information and guidance in connection with protection of viotims of enemy persecution, representation in Hungary, and shelters for Jewish ohildren from Hungary: Portuguese government is in agreement in principle to admit for temporary refuge Hungarian Jewish. refugees, prefer- ably in lots of three to four hundred. Portuguese government has already informed Hungarian government of its interest in such people. It has persuaded Hungarian government to issue exit visas and has itself given Portuguese visas to a number of them, but Germans have refused to permit them to leave as yet. Some 253 -yet. Some of these persons are now in asylum in the Portuguese legation in Hungary. The Hungarian government is thus aware of the Portuguese interest in this problem. Venezuelan government has authorized its legation in Lisbon to visa the passports of Jewish refugees, especially children, who are traveling to the American continent, even though they may not be proceeding to Venezuelan territory. It has also requested the Swiss Political Department to extend the protection of Venezuelan interests to Hungarian territory and other countries of Central and Eastern Europe for the purpose of aiding the bearers of Venezueland passports in those regions. President Vargas of Brazil has approved the plan to bring 500 refugee children to Brazil, provided that the Brazilian Government would not inour the expenses of transportation to and maintenance in Brazil. He has accordingly charged General Ivo Soares, Chairman of the Brazilian Red Cross, with making suitable arrangements with appropriate Jewish welfare agencies in Brazil to take care of them. Official announcement is to follow shortly. Government of Uruguay has agreed to the admittance of 500 refugee children. 3. With reference to Department's 2485 of July 21, Haitian Legation in Bern was instructed on July 31 to request the Swiss to present to the German Government the following declaration of the Haitian Government: QUOTE Inasmuch as a certain number of individuals of the Jewish race naturalized as Haitians abroad in pursuance of the Decree-Law of May 29, 1939, were living in territories controlled by Germany and Italy; that they have been detained there continuously for reasons of force majeure since the declaration of war by the Republic of Haiti until this date, the Haitian Government declares: that the persons in the above-mentioned category have been unable to comply with the Decree-Law of February 4, 1942, enjoining, under penalty of the loss of Haitian nationality, all those who had acquired Haitian naturalization abroad to return to Haiti before August 5, 1942. Consequently, it is hereby made known to whom it may concern that the safid persons are not affected by the Decree-Law of February 4, 1942. UNQUOTE In this connection, 254 -In this connection, the Board's attention has been called to the test base of Mrs. Zelman Solowierozyk, age 42, and Miss Sephora Solowiejczyk, age 7, whose last known address was Jacob Jacobs Street 37, Antwerp, Belgium, and who are the wife and daughter of Zelman Solowiejozyk, now residing in New York City, Under the foregoing declaration, these women, whose Haitian naturalzation is said to have been promulgated in the Moniteur of Haiti on December 23, 1939, retain their Hattian nationality. Please take all appropriate action to insure that these women, if still in German hands, be treated as Haitian nationals. Consult with Haitian Minister if you deem it advisable. The Haitian Legation has also been instructed not to ques- tion at present the validity of Haitian passports held by persons who are now in occupied territories and who could be the object of persecution by the enemy until such persons arrive in a place of safety and to inform the Federal Department of these instructions. This is WRB cabbe to Bern No. 164. HULL 255 ORIGINAL TEXT OF TELEGRAM SENT Secretary of State, Washington American Legation, Bern FROM: TO: DATED: September 14, 1944 NUMBER: 3186 CONFIDENTIAL FROM WAR REFUGEE BOARD FOR MCCLELLAND. Board is receiving numerous urgent requests to take vigorours action on behalf of Jews in Slovakia whose position is reported to have seriously deteriorated without prior warning in recent days. Similar disastrous conditions reported in fact or imminent in Hungary. With respect to Hungarian situation please consult Sternbuch in an effort promptly to secure the names and addresses of persons indicated in Department's 3152 dated September 12, WRB's 165. With respect to the Slovakian situation Union of Orthodox Rabbis reports further urgent pleas for money from the Rabbi of Neutra. Please endeavor to ascertain from Sternbuch the nature and such details as possible of the Rabbi of Neutra's project and, if, in your opinion and that of Saly Mayer such project is feasible and is reasonably calculated to save the lives of Jews is Slovakia, please extend to Sternbuch all possible assistance. To this end, you may in your discretion expend such portion of such funds as may be available to you and to request Saly Mayer to place at your disposal for such purpose such additional funds as you may require within the limits of what may be available to him. If funds in excess of those presently available to you and Saly Mayer in Switzerland are needed for such operation, please advise the Board at once. Nothing hereinabove contained should be construed as indicating that you may not in your discretion arrange to have Sternbuch discuss the Rabbi of Neutra's project with youand Saly Mayer jointly. JDC is in agreement. If, regarding any project you and Saly Mayer are not in agreement with respect to the expenditure of JDC funds, please advise the Board fully at once. Interested persons here assert that lives of group of Hungarian Rabbis and leaders now reported at Bergen-Belsen could have been saved while aboard train if funds had been sent to appropriate persons in Hungary. Would appreciate any comments you may wish to make and such information as there may be avail- able to you with respect to the present condition of said group. THIS IS WRB CABLE TO BERN NO. 169 HULL 256 ORIGINAL TEXT OF TELEGRAM SENT FROM: Secretary of State, Washington TO: American Legation, Bern DATE: September 14, 1944 NUMBER: 3185 CONFIDENTIAL Following for McClelland. The following cable dated September 11 has been received from Ambassador-Winant and War Refugee Board Representative Mann! (Here take in full text of No. 7473 of September 11 from American Embassy, London). We desire your considered judgment as to whether the German or Hungarian authorities have actually offered to permit 2100 or any other number of Jews to leave Hungary provided that they are taken to British or American territory. It is not possible for us to judge whether such a concrete offer has been made or whether the above quoted message from the British Minister in Bern merely represents the opinion of various agencies and individuals that the Germans might possibly be more willing to permit Jews to go to some territory other than Palestine. (See for example your No. 5579 of August 26). A specific answer to this question is necessary before this Government can take any decision in the matter, and a prompt reply from you will be appreciated. You will undoubtedly wish to inquire of the British Minister in.Bern, the officials of the International Red Cross, and all other appropriate groups and individuals, whether they have any further information in the matter. This is WRB cable to Bern No. 170. HULL 257 CABLE TO MINISTER HARRISON AND MOCLELLAND, BERN, SWITZERLAND Sternbuch is reported to endeavor to bring 5000 children from Hungary to Switzerland. German authorities allegedly ready to permit departure under Intercress auspices, and Sternbuch doubtful whether Swiss government has received sufficient guarantees regarding subsequent evacuation of said children to countries other than Palestine. It is expected that such guarantees have been offered to Swiss government pursuant to Department's 891 of March 18, 2236 of July 3, and 2877 of August 21, as well as pursuant to information regarding agreement by Ireland and Honduras (Depart of ment's 2978 of August 29), Nicaragua (Department's . WRB's 158), Portugal, Venezuela, Brasil, Uruguay, (Department's and Cuba (Department's of of WRB's 164) WRB's to admit children from Hungary. In addition, the assurances contained in paragraph three of Department's 2605 of August 1 fully apply, of course, to children from Hungary. You may inform Sternbuch of the existence of these guarantees and assist him in any promising program of evacuating children from Hungary to Switzerland. THIS IS WRB CABLE TO BERN NO. 171 3:10 p.m. September 14, 1944 ), 258 CABLE TO MINISTER HARRISON AND MOCLELLAND, BERN, SWITZERLAND The following is the substance of a communication received from Minister Johnson and Olsen in Stockholmi QUOTE A German group consisting of Boening, Kleist and Klause have recently renewed their approaches with respect to freeing Baltic Jews against 2,000,000 Swedish kroner of civilian relief supplies for German bombed-out population and a concrete proposal allegedly will be advanced this week with Berlin approval. In the meantime it is stated the German authorities have issued strict orders to stop further Jewish persecutions in the Baltic countries. We are also advised that Boening returned to Germany for military service but was immediately released and sent to Bern. It is possible that he is involved in some of the German negotiations in Switzerland with respect to Jews, particularly Hungarian. Believe it highly desirable that there be a close interchange of information as to any such negotiations. UNQUOTE THIS IS WRB CABLE TO BERN NO. 172 3:10 p.m. September 14, 1944 B Aksin/sg 9/13/44 259 PARAPHRASE OF TELEGRAM RECEIVED FROM: American Legation, Bera TO: Secretary of State. Washington DATED: September 14, 1944 NUMBER: 6047 CONFIDENTIAL You are referred to Legation's airmail of May 6. No. 8103 and Department's message of June 26. No. 2173. Copy of note from German Foreign Office dated August 8. which is enclosed with note from Swies Foreign Office dated September 9. statos that investigation disclosed that Pfifferling doon not have citisenship in Handuras and that Pffferling stated only German citisenship is claimed by his family and himself. The foragoing is in connection with Honduran interests in Germany. DOR:GPV (****$ (****** 9-37-44 MARRISON 260 Baraphrase of Telegram Received FROM: American Legation. Born TO: Secretary of State. Washington DATED: September 14. 1944 NUMBER: 6062 SECRET It is stated in a note from the Swiss. dated September 7. that representations have been made to the German Foreign Office by the Swiss Legation. Berlin. is as endeaver to secure authoris sation to visit the camps mentioned is Department's cable 2149, dated June 26, 1944, first paragraph. On August 19 the German Foreign Office responded by note. declaring that the request from the Swiss was referred to compotent officials and stating that further communications on the matter would be sent. WHB 36. HARRISON DCR:MND:CR 9-16-44 261 Distribution of true September 14, 1944 reading only by special arrangment. (SECRET w) 8 p.m. AMEMBASSY ANKARA 800 The following for Steinhardt and Hirschmann is WRB 110. Please refer to your 1694 of August 30, requesting the approval of the Board and the State Department of measures for the emergency relief of Jews in Bulgaria. It is not clear to the Board as to what is meant or contemplated by your reference to emergency relief and the Board would appreciate further details as to the measures which you believe necessary for the emergency relief of Jews in Bulgaria. HULL (GLW) WRB:MMV:KG 9/14/44 NE SE 252 GEK-254 This telegram must be paraphrased before being communicated to anyone other than a Government Ankara Dated September 14, 1944 Reo'd 2:31 p.m., 15th. Agency. (RESTRICTED) Secretary of State, Washington. 1735, September 14, 4 p.m. FOR WRB. Ankara's no. 155. With a view to investigating the possibility of setting up a separate American base for diredting the rescue of refugees from Greece to Turkey under the auspices of the War Refugee Board Katzki has completed an exploration of the situation in Izmir. After consultation with informed persons there and in view of the developing situation in Greece, the inauguration of such an independent operation does not (repeat not) appear warranted at this time. Meanwhile as are informed that an additional approximate 100 refugees have arrived from Greece in Izmir en route to Palestine bringing the total to 900. See my No. 144, August 30. A written report is being sent by pouch. STEINHARDT WSB 263 CABLE TO AMERICAN CONSUL, ISTANBUL, FROM WAR REFUGEE BOARD. Please deliver the following message to Resnik from M.A.Leavitt, American Jewish Joint Distribution Committee: QUOTE SALY MAYER ASKS THAT YOU FURNISH HIM WITH NAME RELIABLE PERSON SOFIA STOP PLEASE CABLE HIM INFORMATION DIRECT WITH COPY TO US UNQUOTE 5:00 p.m. September 14, 1944 264 CABLE TO AMERICAN CONSUL, ISTANBUL, FROM WAR REFUGEE BOARD. Please deliver the following message to Passman Resnik from M. A. Leavitt, American Jewish Joint Distribution Committee: QUOTE YOUR 147 TO LISBON WE HAVE ASKED SALY MAYER PAY ADDITIONAL 114,000 SWISS FRANCS ACCOUNT SZYND THUS COMPLETING FULL PAYMENT 1028 PASSAGES INCLUDING MEFKURA GROUP STOP REGARDING OTHER SAILINGS WISH AGAIN CALL YOUR ATTENTION FACT HIRSCHMANN BELIEVES NO SAILINGS SHOULD NOW TAKE PLACE WITHOUT SAFE CONDUCT FROM ALL PARTIES STOP VIEW CHANGED CONDITIONS RUMANIA WE QUESTION ADVISABILITY RISKING LIVES REFUGEE GROUPS WHO ARE NOW IN COMPARATIVE SAFETY AND WOULD BE ABSOLUTELY OPPOSED MAKING ANY PAYMENTS THIS PURPOSE IF HIRSCHMANN STILL BELIEVES SAFE CONDUCT ESSENTIAL UNQUOTE 5:00 p.m. September 14, 1944 RDrury 9/14/44 265 COPY NO NOT TO BE RE-TRANSMITTED SECRET OPTEL No. 300 Information received up to 1000 hours 14th September 1944. 1. NAVAL Early 10th Warships off MENTONE were unsucc- Mediterranean essfully attacked by human torpedoes. of which 10 were sunk, 3 prisoners taken. Destroyers and Gunboats continued to bombard RIMINI area on 10th and 11th. East Indies cocos ISLAND was attacked by one Japanese Aircraft 8th. Damage slight. 2. MILITARY Northwest Europe 3rd. U.S. Army has made contact with 7th U.S. Army and advanced some 10 miles from NEUFCHATEAU and south of NANCY. Resistance round METZ strong but two bridgeheads have been forced over the MOSELLE. Lst. U.S. Army has entered GERMANY at 5 points east and northeast of LUXEMBOURG and east of LIEGE. A patrol of 2nd British Army has penetrated up to 5 miles into HOLLAND and our bridgehead over the ALBERT CANAL and MEUSESCHELDT CANAL has been consolidated. Canadians have occupied BOUGES and reached LEOPOLD CANAL. They are closing in on BOULOGNE from the north. Southern France After advancing 350 miles in 28 days the 7th U.S. Army established firm junction with 3rd U.S. Army at CLATILLON SUR SEINE. VESOUL has been captured and some progress made towards BELFORT. Russia Russians have captured LOMZA. In the south they have captured CAMPULUNG and advanced further into Northern TRANSYLVANIA taking ODORKEI. 3. AIR OPERATIONS Western Front 12th/13th. In clear weather Bomber Command Aircraft dropped 1557 tons including 802 HE at FRANKFURT and 781 tons including 321 HE at STUTTGART, good concentartions reported and preliminary photographs indicate good results both places. 13th. 117 Bomber Command aircraft attacked OSNABRUCK Railway Centre and town 392 tons. 384 Heavies including 188 Bomber Command attacked oil plants GELSENKIRCHEN 495 tons, MERSEBURG 299 and LUTEKENDORF168. Also oil storage WEISSENHORN 90 tons 538 Heavies bombed industrial targets and airfield and other objectves in Germany and DARMSTADT Railway Centre, total 1287 tons. From these operations 28 heavy bombers and 11 fighters missing, 33 German aircraft shot down and 20 destroyed on the ground. 143 AEAF Bombers attacked strong points BOULOGNE Area and communicat+ ions HOLLAND. 126 fighters attacked objective HAGUE Area. 13th/14th. 36 Mosquitoes sent to BERLIN and 66 aircraft other operations (2 aircraft missing). Moditorranean. the battle area. Italy 12th. 1064 aircraft of the Tactical Air Force attacked communications ets. in 13th. 75 Fortresses returning from RUSSIA bombed DIOSGYOR, HUNGARY and landed in ITALY.