611.5131/1021: Telegram

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

908. Reference Department’s telegram No. 482, December 4, 9 p.m. The substance of the Department’s proposed aide-mémoire seems excellent. My only suggestions with regard thereto are the following:

It would seem to the Embassy preferable to substitute for the third paragraph a simple blunt statement to be inserted at the end of the memorandum such as “In view of the above considerations the Government of the United States does not feel that it is justified in entering into discussions until such time as the French Government is prepared to make a much more advantageous and comprehensive offer.” This omission and substitution would avoid any arbitrary interpretation that might be placed on the criteria listed and any indication that these constituted the maximum demands of the American Government from which the French might attempt to whittle down.

Finally I strongly urge that reference to ratification of the double taxation agreement be incorporated in the body of the aide-mémoire instead of being made orally. I do not feel that we can be too precise on this point with the French Parliament at present in session since it should at anytime, in view of promises previously made, consider that convention although it probably will not do so except under pressure. Some brief reference might be inserted at the end of paragraph 2 of the aide-mémoire along the following lines: “It does not seem expedient to enter into new agreements until such time as an [Page 187] existing agreement, the double taxation treaty, shall have been ratified”. (See my despatch No. 1386 November 27).40

As to the contemplated oral addition I feel (1st) that the treatment sketched which we have to offer holds so little in the nature of special concession that the French Government would never consent to according to the United States sufficiently favorable treatment to justify our entering into a provisional engagement which the French might well be content to let run indefinitely containing as it would of necessity tacit acceptance on our part of certain present conditions of inferior treatment. (2d) But more important I believe that should the Department be disposed to enter into a temporary understanding the suggestion should come from the French Government in order that it may be maintained in the position of taking the initiative and showing anxiety. The French Government has already, as soon as it felt our Government had some slight interest in negotiating, taken advantage of the situation to recede from its original proposals so that it is essential that it first make a concrete offer to which it will be bound in principle.

Straus