462.00R296/4035: Telegram
The Ambassador in Italy (Garrett) to the Secretary of State
[Received June 22—4:25 p.m.]
101. This morning Grandi16 told me he had received a telegram from De Martino17 reporting his conversation with you on Saturday in regard to debts and reparations. He did not, however, tell me what you had said. The text of the White House communiqué had apparently been received by him. This, however, was published yesterday morning in all the papers here. These interesting comments were made by him: This afternoon he is taking the matter up with his chief, but since consultations are required with other members of the Government, and I gathered that he is also obtaining information from Italian representatives in the other capitals concerned, it may be several days before the Italian viewpoint can be given. As soon as possible there will be communicated to De Martino the Italian viewpoint.
After saying they had not expected so much from America, Grandi said he felt sure Italy would fall in with the President’s suggestion. Italy was disposed to come to Germany’s assistance, but could not grant to Germany a complete remission of reparations for a year without an undertaking on her part not to proceed further with the German-Austrian Customs Union during that period. Financial assistance had been offered to Austria in her present crisis by France and there had been coupled with it political terms with which Italy, who was also ready to help Austria financially, was now disposed to agree, though in a less harsh manner than France. He was informed that strenuous efforts of the German Legation at Vienna had been successful in bringing about the appointment of a more pro-German or pan-German Cabinet than Austria had yet had. In the remission of reparations, Italy was clearly not disposed to do anything that would permit Germany to help Austria financially, coupling with her help, as she surely would, further pressure towards the German-Austrian Customs Union. Although there was a point in her relations with Germany beyond which Italy could not and would not go, Italy and Great Britain were inclined to help Germany. Anything that might help Germany to extend her hegemony over any of the succession states, particularly over Austria, would be opposed by Italy.