Office of the Historian

462.00 R 294/316: Telegram

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

[Paraphrase]
Paris, February 1, 1924—5 p.m.
[Received 11:45 p.m.]

54. L–86, from Logan.61 Reference Department’s telegram December 13, 1923, 3 p.m.62

1.
Am I to understand that if Bulgarian payment is to be credited to reparation account of Germany, I am to claim participation by United States therein under article 2 of Army Costs Agreement?63
2.
Personally I hold strongly to the view that if funds are not to be used for cost of Armies of Occupation in Bulgaria or for Bulgarian commissions of control, they must be credited on Bulgarian reparation account; and if they are so credited they must at the same time be credited to Germany’s reparation account and so to reduction of the 132 billion gold marks.
3.
See in this connection paragraph 11, Finance Ministers’ Agreement, March 11, 1922,64 which relates to the German C bonds:65 “The Powers receiving payments in cash or in kind from Austria, Hungary and Bulgaria, shall return to the Reparation Commission for cancellation series C bonds of the nominal value of these payments.”
4.
Even if reparation payment made by Bulgaria last October should be used for commissions of control or for Army of Occupation costs, some of the future payments to come from Bulgaria undoubtedly will be applied to reparation. It follows that in any event Department must take definite position on asserting right to participation for our Army costs in Bulgarian payments which are applied to reparations.
5.
I fear that though the Bulgarian payment is at present in a blocked account, the blockade might be lifted suddenly, and the funds distributed in the customary fashion, and should that happen we would be faced with a fait accompli, which would provide the Allies with a strong tactical position. Past experience demonstrates amply that once cash has been distributed it is almost impossible [Page 153] to recover it, but if I have clear instructions ahead of time on Department’s attitude, I shall be able to take appropriate conservatory-action when the blockade on the payment is lifted, or at any other time that seems most opportune so that our claim will be given full consideration.
6.
I do not think the Reparation Commission is competent to interpret the Army Costs Agreement without a mandate from the powers and the United States. The powers might tacitly assent to the action of their delegates. If the delegates oppose claim of our Government, I would reserve all rights. The Department should be prepared on the next step to take, that is, either reference for arbitration to some personage or body, or diplomatic parleys with the Allied Powers. The latter course would, however, doubtless make for delay. Logan.
Herrick
  1. American unofficial representative on the Reparation Commission.↩
  2. Foreign Relations, 1923, vol. ii, p. 190.↩
  3. Agreement of May 25, 1923; see ibid., p. 180.↩
  4. British and Foreign State Papers, 1922, vol. cxvi, p. 612.↩
  5. Quoted sentence not paraphrased.↩