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We agree that such a proposal at this late date is, as you say, out of the question. It seems to us further that the proposed exchange of notes should meet the situation.

HULL

811.34544/713: Telegram The Acting Secretary of State to the Ambassador in the United

Kingdom (Winant)

WASHINGTON, March 18, 1941. 910. For the Ambassador and the President's Base Lease Commission. Your 1047, 18th. The Ambassador and the members of the President's Base Lease Commission are hereby authorized to sign for the United States of America the agreement now under negotiation with respect to the use and operation of the bases leased to the United States in exchange for the 50 destroyers.

If the agreement in its entirety has received the approval of this Government your signatures for the United States will be without qualification. If, however, the final text of the agreement has not received the approval of this Government you will sign ad referendum as to those articles or clauses which are still subject to the approval of this Government.

You will understand that approval by this Government of the final text entails approval by the Secretaries of State, War, and Navy, the Attorney General, and the final approval by the President. Notification to you of approval of the final text, or any part thereof, may be considered as indicating the approval of the President and the Cabinet officers above mentioned.

WELLES

811.34544/713 : Telegram The Acting Secretary of State to the Ambassador in the United

Kingdom (Winant)

WASHINGTON, March 24, 1941. 987. For the Ambassador and the President's Base Lease Commission. My 910, March 18. The text of the Agreement set forth in your 1085 of March 19 97 has been approved by the Government of the United States, subject to the alterations which have been proposed and accepted by telegraph since the receipt of your telegram under reference. You may therefore with the approval of the President sign the Agreement for the United States; your signatures will be without qualification. Authorization to sign the Protocol was given in my 977, March 22nd.99

e? Not printed.

It is the President's wish that the Agreement be signed Wednesday." He is sending a message to Congress enclosing the Agreement, the Newfoundland protocol and the notes exchanged in connection with the Agreement for the information of the Congress. He wishes to send this message at 12, noon, Washington time, Thursday, March 27, and we hope that it will be agreeable to the British authorities for the Agreement to be released simultaneously in Washington and London at that hour for immediate publication.

It is our understanding that the following notes will be exchanged at the time the agreement is signed :

(1) In regard to the status of Newfoundland (texts of both notes quoted in your 1063, March 18 99).

(2) In regard to censorship and examination of mail, dealt with in your 1154, March 24,99 and a separate telegram which we are sending you today.

WELLES

99

811.34544/798: Telegram
The Ambassador in the United Kingdom (Winant) to the
Secretary of State

LONDON, March 27, 1941.

[Received March 27–1:05 p. m.] 1207. For the President and the Secretary of State. The Base Lease Agreement has been signed. I think it contains everything we need to use these bases effectively.

The rights and powers it conveys are far-reaching, probably more far-reaching than any the British Government has ever given anyone over British territory before. They are not used to giving such concessions and on certain points they have fought every inch of the way. While they have intended all along to give us everything we really needed—they could do no less and had no desire to do less—it was a real struggle for them to break habits of 300 years. The Prime Minister has been generous throughout. Certain powers, notably those in article XI, are so sweeping that the British would never have granted them except as a natural consequence of the original agreement and the spirit which it embodies.

It is important that the agreement be carried out in that spirit. The Colonies have been lightly touched by the war, their point of view is local and their way of life will be greatly changed by the bases.

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In the main the changes will benefit them but it may take them some time to find it out.

In the negotiations both sides have tried to avoid anything which would wall off the bases from the local communities. Our people and theirs are to live together without even a fence, much less a frontier, between them.

The character of the men in command of the bases is of tremendous importance, especially in the beginning. If they are the right kind and ready to carry out our part of the agreement in a friendly and understanding spirit they can do much to inaugurate 99 years of good neighborliness.

Malony, Fahy and Biesemeier have fought hard and won everyone's respect and friendship. You sent a fine team and they have done a grand job. So did Achilles in assisting them.

WINANT

[For text of the agreement and exchange of notes signed March 27, 1941, see Department of State Executive Agreement Series No. 235, or 55 Stat. (pt. 2) 1560.]

AGREEMENT AND EXCHANGES OF NOTES BETWEEN THE UNITED STATES AND THE UNITED KINGDOM AND PROTOCOL BETWEEN THE UNITED STATES, THE UNITED KINGDOM, AND CANADA CONCERNING THE DEFENSE OF NEWFOUNDLAND, SIGNED MARCH 27, 1941

[For text of the agreement, notes, and protocol, see Department of State Executive Agreement Series No. 235 or 55 Stat. (pt. 2) 1560, 1595, 1599. For correspondence concerning the negotiations for transfer of American destroyers to the British Navy and for establishment of American naval and air bases in British possessions in the Western Hemisphere, see Foreign Relations, 1940, volume III, pages 49 ff.; see also ante, pages 53 ff.]

ANGLO-AMERICAN DISCUSSIONS REGARDING POSTWAR RELIEF AND

INTERNATIONAL CONTROL OF COMMODITIES 840.48/45273 The Assistant Secretary of State (Grady) to the Director General, British Ministry of Economic Warfare (Leith-Ross) 3

WASHINGTON, January 2, 1941. MY DEAR LEITH-Ross : In the first place let me assure you that I received and read your letter of November 30 4 with very great interest and have been giving it considerable thought, while at the same time during my recent absence from Washington, it has been receiving the attention of officers of Department's staff who are most interested in the general problems covered.

* Continued from Foreign Relations, 1940, vol. III, pp. 132-142.

* Transmitted through the American Embassy in London. Sir Frederick William Leith-Ross had been economic adviser to the British Government since

* Foreign Relations, 1940, vol. II, p. 138.

2. On the whole, I find myself in cordial agreement with the general tenor and substance of your comment. The gravity of the surplus problem, both in its immediate aspects and its post-war probabilities, and the need for broad and long-range vision and planning to deal with it, are undeniable. I quite agree with your view that “the surpluses problem should be viewed as a great whole and as a collection of individual surpluses in particular countries.” A program of joint AngloAmerican cooperation should manifestly serve to increase immeasurably the scope and potentialities of effective action, as contrasted with separate efforts.

3. Before commenting more specifically upon your views regarding methods, it might be useful were I to mention briefly the main aspects of our program of inter-American cooperation so far as they relate to the problem of surpluses, since the late Lord Lothian's 5 memoranda of July 3 and September 18 6 appear to have been stimulated in some part by certain proposals of a very general nature discussed in connection with the Habana Conference of last July," and perhaps the impression conveyed by these proposals has been somewhat different from the actual facts. The original proposals themselves were of very general and broad nature; I think it fair to say that their main immediate effect has been to stimulate discussion and action along more limited and perhaps more realistic lines. As you know, the principal outcome of the Habana Conference, so far as commodity surplus problems were concerned, was a mandate to the Inter-American Financial and Economic Advisory Committee to carry on. As a result there has already emerged an agreement relating to coffee, with which you are by now doubtless familiar, and which is primarily, from the point of view of producers, an American problem; some work has been initiated also with reference to cocoa and to cotton, which of course present situations radically different from that of coffee in that the non-American production is so much more important in their cases. As you have doubtless been informed, steps of an informal nature have already been taken to keep your Embassy here informed of what is going on with respect to cocoa, and to provide a basis for cooperative endeavors, and I think I can say with complete confidence that the desirability of joint Anglo-American action, using the term American in its wide sense to include also the other American Republics, in any international scheme to deal with cocoa, is recognized.

* Former British Ambassador to the United States; he died in Washington, December 12, 1940. * Foreign Relations, 1940, vol. III, pp. 134 and 135.

See Department of State, Second Meeting of the Ministers of Foreign Affairs of the American Republics, Habana, July 21–30, 1940, Report of the Secretary of State (Washington, Government Printing Office, 1941), p. 10.

See ibid., pp. 25 and 80.

In April 1941 representatives of the Department of State and the Department of Agriculture participated in informal conversations with officials of the British Embassy and with a representative of the Brazilian Government. The result of these conversations was the preparation of a memorandum outlining the possible bases for an international cotton agreement which was submitted to the cotton subcommittee of the Inter-American Financial and Economic Committee as a proposal of the United States. Correspondence not printed.

A beginning in another direction has been made in connection with relief distribution of surpluses, or more specifically, the possibility of applying on an inter-American basis arrangements analogous to our domestic scheme for relief distribution of surplus commodities. In this also, however, only rudimentary progress has been made, and I am sure that nothing has been done which would provide any substantial conflict with, or obstacle to, the adoption of a program of joint Anglo-American cooperation.

4. So far as the financial aspect of our inter-American cooperation is concerned, you know of course that subsequent to the Habana Conference the Congress increased by five hundred million dollars the lending authority of the Export-Import Bank.10 The greater partthough not all—of this assistance is expected to be extended to Latin American countries. The policy thus far pursued in granting such credits has been to direct efforts toward the relief and remedy of the general situation rather than to buy up or to make loans directly against specific accumulations of surplus commodities. Credits have been advanced to the governments themselves to help meet the urgent necessities of their general foreign trade and exchange position and to stimulate and promote new activities designed to improve their general economic stability and their trade prospects with ourselves.

There has indeed been some purchasing and accumulation of stores of strategic materials, but this is based on our defense program rather than as a specific remedy for the commodity surpluses problem.

5. Thus we have not, as yet at least, been using financial credits as a direct method of solution of the international surpluses problem in this hemisphere through purchase of or specific loan against particular commodity surpluses (as distinguished of course from our purely domestic surplus relief activities). I would not say, however, that the use of financial assistance as part of sound schemes for solution of international commodity surplus problems would be specifically precluded. The coffee agreement does indeed contain a provision stipulating the assistance of the Coffee Board in arranging

10 Act of September 26, 1940; 54 Stat. 961. 1 For correspondence concerning plans to acquire adequate stockpiles of strategic raw materials, see Foreign Relations, 1940, vol. II, pp. 250 ff.

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