March 16,
1945
11:30 a.m.
GROUP
MEETING
Bretton Woods — I.T.&T. — Reparations
Present:
Mr. White
Mr. Fussell
Mr. Feltus
Mr. Coe
Mr. DuBois
Mrs. Klotz
H.M., Jr.:
Frank, can you boil
down this business on I.T.&T.?
Mr. Coe:
Yes, sir. I.T. &T.
by the way did transfer or did get $15 million yesterday or a few
days ago of their debts in dollars paid to them by the Spanish
Government and that they are allowed to do under our general
license, so that's all right. However, it is in part in their
representation to us, part of a deal for the sale of the company in
Spain, so they are trying thereby to force our hand. Now, the
proposition which they have had up over some years in different
forms now takes this form. They can get their receivables paid off
in dollars, which they say they have not been able to do hitherto —
either $15 million now and $10 million or $11 million later. They
will sell the company to Spain and take in return $30 million worth
of bonds — Spanish Government bonds — which are to be amortized over
a number of years and roughly at the rate of $2 million per annum,
and they are to receive 90% of those exports in order to amortize
bonds faster, if they are to export it to the United States.
H. M. Jr.:
Like the match
dealer I mentioned in my speech.
Mr. Coe:
That's right. The
Spanish Government. They are willing, they say — they are able to
get from the Spanish Government assurances, that these will not be,
that the shares which the Spanish Government intends to resell will
not go to anybody on the black list, and so forth. In some
negotiations we have had with them over the last few weeks, they
have been willing to come further on that. Our hesitation on the
matter relates to two things; First, that you can't trust Franco,
and that if they are able — if Franco is able to sell $50 million
worth of shares Of this company in Spain in the next period of time,
he may very well sell it to pro-German interests. It seems doubtful
that he would be able to dispose of it to the Spaniards, so that is
the first thing. The second thing we can't document too well, but I
think it is more pronounced in my mind than in the minds of the
Foreign Funds and legal people. I don't think we can really trust
Behn either.
Mr. White:
I'm sure you can't.
Mr. Coe:
We have records
here of interviews, going far back, that some of your men had with
Behn — Klaus was one — in which Behn said that he had had
conversations with Goering with the proposition that Goering was to
hold I.T. &T.'s property in Germany, and as you recall, I.T. &T.
here did try to purchase General Aniline and make it an American
company thereby and that was part of the deal which Behn told State
and our lawyers very frankly he had discussed. He thought it was
perfectly all right protecting property: That was before we entered
the war,
H. M., Jr.:
I don't remember
that,
Mr. Coe:
The man in charge
of their properties now is Westrick who you recall came over here
and was mixed up with Texaco. They tried in every way to cook up
deals earlier to escape. They are tied up with top German group and
etc. On the other hand, Colonel Behn has been used several times as
an emissary by the State Department, and I believe he is personally
on very good terms with Stettinius. We have heard from State on this
letter saying they have no objections. We proposed to you earlier —
the letter which I sent in to you suggesting that you ask State, if
in view of our safe haven objectives, they still said yes. I am
confident from talking with them on the phone the last day or two,
they will write back and say yes, they still think it is a good
deal.
H. M., Jr.:
This is the
position I am in. As you gentlemen know I am overextended now and I
can't go into this thing personally, and I think that we are just
going to have to throw the thing in the lap of the State Department,
and if they want to clear it, all right. I just haven't got the time
or the energy to fight them on that basis.
Mr. Coe:
Then we ought to
license it now.
Mr. White:
First you ought to
get a letter. I agree with the Secretary on this point of view that
this fellow Behn is not to be trusted around the corner. There is
something about this deal that looks suspicious and has been for the
last couple of years we have been dealing with him. However, it is
one thing to believe that and another thing to defend that before
the pressure that will be brought in here that they are trying to
deprive this company of the business deal, but I think that what we
might do is get the State Department on record that in view of a
safe haven project they don't think that there is any danger that
any of these assets — I would cite some of them, spell the letter
out. Get them down on record and even make them a little frightened
and hold out or they will at least have had the record and you will
have called their attention to these dangers. This fellow Behn hates
our guts anyway. We have been standing between him and deals for 4
years, at least.
H. M.,
Jr.: Follow what White said. Something along that line. "Dear Mr,
Stettinius; I am bothered about these things due to the following
facts, and I would like you to advise me whether we should or should
not .... "
Mr. White:
"In view of the
danger that German assets may be cloaked here, the future —" and let
him come back and say, "No," and we'll watch him.
Mr. Coe:
We said we wanted
to give Acheson something Monday.
H. M., Jr.:
And if you get that
ready for me by tomorrow morning, I'll sign it. Mr. Coe: O.K.