Foreign Relations of the United States: Diplomatic Papers, 1944, The American Republics, Volume VII

810.20 Defense/3640

Admiral William D. Leahy, Chief of Staff to the Commander in Chief of the Army and Navy, to the Secretary of State

Washington, 30 December 1943.

My Dear Mr. Hull: Your letters of 13 September 1943 to the Secretary of War and the Secretary of the Navy,² recommending revision of Lend-Lease credits to other American Republics, have been studied by the Joint Army and Navy Advisory Board on American Republics. Their report, which has been approved by the Joint Chiefs of Staff is forwarded herewith.

. . . . . . . . . . . . . .

For the Joint Chiefs of Staff:

William D. Leahy

[Enclosure]

Report by the Joint Army and Navy Advisory Board on American Republics³

[Washington, undated.]

Subject: Revision of the Board’s memorandum concerning munitions of war for American Republics dated 3 March 1941.⁴

References:	(a)	Letters from the Secretary of State to the Secretary of War and the Secretary of the Navy dated 13 September 19434a recommending revision of Lend-Lease credits to other American Republics.
	(b)	Joint War and Navy Department memorandum dated 17 December 19404a creating a board to consider matters pertaining to the procurement of munitions of war in the United States by American Republics.
	(c)	Report of Joint Advisory Board dated March 3 1941.4a

[Here follow a list of enclosures and an outline of facts, figures, recommendations, and policies taken into consideration by the Advisory Board in its deliberation of this matter.]

3. The Board finds:

a. That official requests for armaments through prescribed channels have been submitted by all American Republics and Lend-Lease agreements have been signed with all, except Argentina and Panama.

b. That the total of War and Navy Department Lend-Lease credits granted to all American Republics is $425,890,000, of which $325,890,000 is for Army equipment and $100,000,000 for Naval equipment. Lend-Lease agreements require that the countries concerned return to the United States on an average approximately 34% of the money value of material received.

c. That the approximate value of Defense Aid Material approved for transfer by the Army as of June 30 is $125,000,000. Of this amount approximately $99,000,000 has been shipped and and invoiced. The Navy has accepted requisitions which on completion will have a value of approximately $41,000,000 exclusive of vessels which by law are to be leased. Included in this total, material to the amount of approximately $9,000,000 has been shipped and invoiced as of July 31, 1943. In addition, the Navy has either leased or made commitments to lease vessels having an approximate value of $22,000,000. Treasury Procurement has accepted requisitions for material for the ultimate use of the Armed Forces in the amount of approximately $4,500,000. Of this amount, material to the value of approximately $1,500,000 has been delivered and invoiced.

d. The summary of the above follows:

Procurement Agency	Requisitions Accepted for Ultimate Dlvy.	Delivered and Invoiced to Date
Army	$125,000,000	$99,000,000	—6/30/43
Navy	41,000,000	9,000,000	—7/31/43
Treasury Procurement	4,500,000	1,500,000	—11/ 1/43
Totals	$170,500,000	$109,500,000

The approximate value of vessels leased or to be leased by U. S. Navy totals $22,000,000 in addition to the above.

e. In 1941 specific amounts were approved for Lend-Lease purposes by Congress but on December 17, 1941, in the case of the Army, and February 1942, in the case of the Navy, authority was granted to these Departments with certain limitations to use funds available to them for Lend-Lease purposes.

f. That some friction is being created between the other American Republics as a result of jealousy due to the distribution of Lend-Lease material.

g. That, in general, commitments and deliveries of material have been made in accordance with the varying strategic situations corresponding to the following periods.

(1) June 1940 to December 1941 (Pearl Harbor). This period corresponded to the Staff Conversations and our efforts to obtain Latin American bases and facilities.⁵ It also coincided with the darkest period of the war—the elimination of France, the entrance of Italy into the war, Dunkirk, and Pearl Harbor. No doubt certain commitments were made which would not be warranted under later improved strategical situations.

(2) December 1941 to March 1943. This was the period of greatest expansion of American industry. During this time few commitments or deliveries of material were made to Latin America. The occupation of North Africa removed the principal threat against Latin America.

(3) March 1943 to November 1943. During this period American production began to catch up in certain lines. Deliveries of commitments made in 1941 and 1942 began to be made.

4. The Board is of the opinion:

a. That under the present strategic situation any major threat to the security of the Western Hemisphere has largely been removed.

b. That Axis submarine operations now constitute the greatest menace to our common interests and are a matter which must continue to receive our serious consideration.

c. That except for measures necessary to combat submarines, it may generally be said that existing defense plants and establishments throughout North and South America are adequate to meet the situation.

d. That the mere fact that individual countries have been allocated individual Lend-Lease credits has encouraged some to request matériel not needed for the war effort.

e. That if the requests for matériel are properly screened and granted only for essential projects, there is no further necessity for specific dollar allocations of Lend-Lease credits to individual countries.

f. That our present Lend-Lease policy as indicated by individual agreements now in effect with the other American Republics should be modified and/or broadened to meet the changed strategic situation.

g. That many of the United Nations, armed neutrals and Axis Powers will carry over great surpluses of strictly military items into the post-war period and in order to establish influence of a military character throughout the Western Hemisphere, will undoubtedly be glad to furnish it to the other American Republics on a barter or low cash value basis.

h. That the uncontrolled acquisition of armaments by the American Republics may be the cause of reviving feuds and disputes to such an extent as to create armed conflicts.

i. That the standardization by the American Republics upon United States equipment and training doctrine to the exclusion of foreign matériel and military influence is of first importance to the peace and safety of the Western Hemisphere.

j. That such standardization if carefully planned and executed will diminish rather than increase the military and political animosities presently existing between the armed forces of the various American Republics.

k. That the delivery of military matériel by the United States to the other American Republics for the purpose of securing continued military cooperation is authorized under the provisions of the applicable Lend-Lease statutes.

l. That the disposition of surplus matériel to the American Republics either through Lend-Lease or negotiated cash purchase would probably bring a greater dollar value return for this matériel than could be secured by any other method.

m. That unless some inter-American agreement is reached, there is liable to be considerable competition amongst the American Republics in acquiring surplus armaments which they deem necessary for their national security.

n. That it is presently impracticable to determine with any degree of accuracy what additional equipment should be furnished to the individual American Republics or what the individual Lend-Lease credits in dollar value should be as this will depend upon the nature of military operations and plans for future military cooperation with the American Republics.

o. That the future relationships between our country and the other American Republics will largely depend upon our present handling of Lend-Lease credits.

5. The Board recommends:

a. That, in general, future procurement under Lend-Lease shall be approved only for the following projects:

(1) The development and preparation of such ground, naval, and air forces, with their supporting establishments and installations as may be required for Joint operations with United Nations Forces engaged in antisubmarine or other offensive military operations within this hemisphere.

(2) The training and equipping of such American Republic Forces as may be employed in conjunction with forces of the United Nations in offensive operations overseas.

(3) The repair and maintenance of existing equipment essential to the war effort where facilities do not exist for making repairs locally.

(4) The shipment of limited amounts of certain armaments to enable our military and naval missions to maintain an interest in American matériel and training methods to the exclusion of non-American matériel and influences.

(5) The furnishing of munitions and equipment by type and in the quantities best designed to maintain internal security in those countries exporting vital strategic materials to the United Nations and whose governments continue to support the United States.

b. That within the framework of our international agreements and through the agency of staff conversations conducted with the other American Republics, steps be taken to arrive at an inter-American understanding and plan as to the type and strength of the Armed Forces necessary to maintain order and insure continuing military collaboration in the Western Hemisphere.

c. That plans for continuing military cooperation be considered principally the responsibility of the United States and as far as possible all military and naval agreements made with other American Republics shall be extensions of our own War and Navy Department plans.

d. That under these plans and agreements the forces of the other American Republics be equipped under Lend-Lease or by negotiated cash purchase with surplus standard United States matériel and trained in accordance with United States standards.

e. That no munitions of war or matériel destined to the Armed Forces of the other American Republics shall be procured in the United States without first having been carefully screened and approved by the appropriate agencies of the War and Navy Departments.

f. That the requirements which are clearly for Navy use, although procured by the United States War Department, should be presented to the United States Navy Department, which will negotiate with the War Department as to procurement; similarly, those clearly for Army use, although procured by the United States Navy Department, should be presented to the United States War Department, which will negotiate with the Navy Department as to procurement.

g. That all requests for materials which are destined for the use of the Armed Forces of the American Republics and which are procurable by agencies other than the United States War and Navy Departments, should first be presented to the War or Navy Department, as indicated in paragraph f above, and the service having cognizance will process for procurement through the prescribed channels.

h. That both Army and Navy Lend-Lease credits allocated to each individual American Republic be cancelled and the unobligated balance of the total Lend-Lease credit assigned to each service be considered available for furnishing Lend-Lease matériel to any of the Latin American countries, eligible for Lend-Lease, as may be required, and in accordance with the following:

(1) To furnish matériel as prescribed in paragraph a above.

(2) To furnish surplus standard United States war materials for the purpose of equipping Latin American Armed Forces as may be determined by inter-American agreements.

i. That only such armaments and matériel be furnished under paragraph h (2) above, as are of a purely military character, taken from military surpluses and not adaptable to peace-time civilian use.

j. That other necessary items including armaments and matériel outside of the requirements as mentioned in paragraphs a and h above, be supplied by cash purchase only.

k. That a copy of this report be furnished to the Secretary of State in reply to his letters to the Secretary of War and the Secretary of the Navy dated 13 September 1943 concerning revision of Lend-Lease credits to the other American Republics.

Army Members	Navy Members
/s/ G. C. Jamison, Brigadier General, AAF	/s/ W. O. Spears Rear Admiral, USN (Ret.)
/s/ B. C. Wright, Brig. Gen. AAF per Winant Johnson, Lt. Col. (Sig. C., Alternate)	/s/ C. J. Parrish, Captain, USN
/s/ W. J. Morrissey, Colonel, USA Asst. Chief of Staff, G–4 Representative	/s/ H. C. Parker, Commander, USNR
/s/ R. A. Doyle, Lieut. Colonel, USA Asst. Chief of Staff, OPD Representative
___________	___________
Secretary of War	Secretary of Navy

2. Not printed. These letters noted that credits to the other American Republics for procurement of armaments in the United States had been granted on the basis of the strategic importance of each country in hemisphere defense, but that since the progress of the war had to a considerable extent removed the threat to the security of the Western Hemisphere, the original plan set up in 1941 by the Joint Army and Navy Advisory Board should be revised. The Secretary of State observed that discussion of this matter by representatives of the three Departments within the Standing Liaison Committee had culminated in an expression of views at a meeting on August 5, and he requested that the War and Navy Departments now undertake revision of the original plan in detail, indicating as far as practicable the value of equipment to be delivered to each of the American Republics beyond the quantities already furnished (810.24/348). For the discussions in the Standing Liaison Committee, see Stetson Conn and Byron Fairchild, The Framework of Hemisphere Defense, in the official Army history, United States Army in World War II: The Western Hemisphere (Washington, Government Printing Office, 1960), pp. 235–286.
3. Addressed to the Secretary of War and the Secretary of the Navy.
4. Not printed.
5. Not printed.
6. Not printed.
7. Not printed.
5. For correspondence concerning these matters, see Foreign Relations, 1940, vol. i, pp. 681 ff., and ibid., 1941, vol. vi, pp. 55 ff.