49 Cranborne to Commonwealth Government

Cablegram 44 LONDON, 12 February 1944, 7 p.m.

IMPORTANT SECRET

Your telegram No. 31 Lend Lease. [1]

1. We are grateful for this further expression of your views which we have found most helpful. We recognise force of argument in paragraph 1 of your telegram and fully understand desire of Commonwealth Government to protect themselves against any possible encroachment on their own freedom of action in relation to reciprocal aid to United States.

2. We do not feel, however, that procedure now proposed in relation to United States restrictions of Lend Lease should involve this danger. Our insistence on prior discussion will enable United States authorities to have our comments before arriving at final decision, but it is of course clearly understood that decision in each case must rest entirely with them in pursuance of their own responsibility to Congress.

3. So far as expressing 'agreement' or 'acquiescence' is concerned we think it would be difficult to insist on prior discussion and yet to decline in such discussion to say whether proposal in question is acceptable to us or not. No doubt some of the proposals will not be acceptable to us and our position in expressing disagreement with these will, we feel, be materially strengthened if in the case of other items we indicate acceptance rather than tacit acquiescence. In this way, we should hope to build up better atmosphere for resolving these questions and feel that procedure for prior discussion, as opposed to mere notification of decisions already taken, marks in itself a substantial step forward.

4. Matter has now been brought to a head by desire on part of Foreign Economic Administration to make public announcement that the British Empire have agreed to elimination of items (a) and (b) in my telegram No. 24. [2] We understand that United Kingdom Missions in Washington have discussed this proposal with Dominion Missions. We do not feel that we are in a position to object to such announcement so far as the United Kingdom is concerned, but in so informing our representatives in Washington we have made it clear that particular care be taken to ensure that nothing is said which might misrepresent position of those Governments, which have felt themselves bound to a greater or lesser extent to take up a position different from our own.

5. As to paragraph 3 of your telegram, we are of course most anxious that machinery for consultation should be as effective as possible. We think ourselves that if fresh suggestions are made by Foreign Economic Administration best procedure would be for all such suggestions to be discussed as and when made by United Kingdom and Dominion Missions in Washington and referred by them to their respective Governments. if it appeared to us that any important questions of principle arose we should at once telegraph our views to you and at the same time explain position to our Missions in Washington and we hope that the Commonwealth Government would adopt corresponding procedure at their end. If no such questions seemed to us to arise we should simply send instructions to our Missions who after comparing notes with Dominion Missions would then be able to put our views to Foreign Economic Administration. We hope that this procedure will be acceptable to you.

6. We understand that United Kingdom and Dominion Missions are maintaining close contact in regard to further list of proposals submitted by Foreign Economic Administration last week. [3] Although on certain of these proposals we have comments on points of detail, which we are instructing our Missions to bring to the notice of the United States authorities, we do not think that any important questions of principle arise. Matter becomes therefore one of dealing with individual items on their merits in the light of exchanges of views between the respective Missions in Washington.

1 Document 41.

2 Dispatched 21 January. On file AA: A989, 43-44/980/8/3/1, ii.

The items referred to were shipments of capital goods and off- shore purchases.

3 Presumably additional items suggested for exclusion from Lend Lease, listed in LL[44]15 of 4 February (attached to memorandum DG622 of 9 February). On file AA: A571, L41/915A, iv.

[AA:A989, 43-44/950/8/3/1, ii]