Loan Negotiations with the US (Draft) ― Faced with a “Financial Dunkirk” Toshiaki Hirai (Sophia University)

Loan Negotiations with the US (Draft) ― Faced with a “Financial Dunkirk” Toshiaki Hirai (Sophia University) It was on August 17, 1945 - immediately after the end of the WWII -  that the Lend-Lease Act (LLA) was abolished. This was a snap  judgment by President Truman, a successor of Roosevelt from April on, indicating the beginning of the so-called “Stage III” with the end of the “Stage II” (the period from the defeat of Germany to that of Japan). Faced with this emergent situation, Clement Attlee, the leader of  the Labour Party, who became a prime minister just in July through an unexpectedly overwhelming victory in the general election, defeating Churchill, held a cabinet meeting on August 23, based on Keynes’s  proposal produced on August 13. Between August 17 and 23, Keynes  wrote a memorandum, “Our Overseas Financial Prospects” (Keynes  [1945]), warning a “financial Dunkirk”. On the next day, the delegation with Keynes as the top for the  negotiation with the U.S. was announced at the Commons. It left for the U.S. on August 27. Concerning a financial negotiation with the U.S., there had been one leading up to the “Anglo-American Mutual Aid Agreement” (February  1942) based on the LLA (March 1941), followed by a further negotiation due to the changed political and economical situation. As Keynes was a representative of these negotiations, his selection above-mentioned  was a natural course of event. What this paper aims at is an examination of the process of the  negotiation which started on late August and came to the conclusion of “The Anglo-American Financial Agreements” (December 6), and an  evaluation of how Keynes showed his stance as a negotiator during this process. 1. Introduction 2. Preparatory Stage: August 1945 2.1 Proposals for Financial Arrangements in the Sterling Area and between the U.S. and the U.K. to Follow after Lend Lease 2.2 Some Highly Preliminary Notes on the Forthcoming Conversations: 9 September 1945 3. Favorable Phase 3.1 Top Committee (U.S.-U.K. Financial and Economic Negotiations Top Committee): September 13― 20 3.2 Favorable Proceeding: September 20 ― October 12 4. Offense and Defense of Tactics and the Stalemate Phase: October 12 ―November 18 5. Confusion and Outcome: November 19 ― December 6 5.1 Organizational Confusion and Lack of Understanding in the US side 5.2 Internal Conflict in the UK Side ― Cabinet Meeting vs. Delegation 5.3 Vinson’s Behavior and The Anglo-American Financial Agreement (December 6) 6. Chilly Response in the UK and Keynes’s Speech at the House of Lords 6.1 Chilly Response 6.2 Keynes’s Speech at the House of Lords 7. Conclusion

Reparations and Keynes：September 1941 - December 1945 （Draft) Toshiaki Hirai (Sophia Univ.)

Reparations and Keynes：September 1941 - December 1945　（Draft)

Toshiaki Hirai (Sophia Univ.)

1. Introduction

2. Motivator

3. Opening

4. Malkin Committee
4.1 Keynes’s two papers
4.2 Keynes’s explanatory meeting on the Malkin Report － At the State 
Department

5. On the Demolition and Reparations of Germany
5.1 Morgenthau Program (“Program to Prevent Germany from Starting a World War III”)

5.2 Keynes’s response to the Morgenthau Program

6. Keynes’s View thereafter

7. Conclusion

Keynes’s Stance over Commercial Policy ― What Emphasis on “Imports Regulation” and “Bilateralism” Indicate Toshiaki Hirai (Sophia Univ.)

Keynes’s Stance over Commercial Policy （Draft) ― What Emphasis on “Imports Regulation” and “Bilateralism” Indicate Toshiaki Hirai (Sophia Univ.) 1. Introduction 2. Response to Meade’s Proposal on Commercial Union 2.1 Comment:“Project of a Commercial Union” 2.2 Response to: Overton Committee Draft Report 3. Keynes’s Comment and Meade’s Response ― over Imports Regulation and Bilateralism 4. Keynes’s Comment and J.M. Fleming’s Response ― Regulations of Imports vs. ExchangeDepreciation 5. Proceeding Situation within the British Government 6. Keynes’s Messages － from Washington 7. Conclusion Appendix 1. “My Notes on Mr Pasvolsky’s Memo” Appendix 2. “A Proposal for an International Commercial Union”

The Anglo-American Mutual Aid Agreement Viewed through Keynes as a Negotiator

The Anglo-American Mutual Aid Agreement Viewed through Keynes as a Negotiator

    

- Amid the Conflict/Cooperation between the Two Powers

Toshiaki Hirai (Sophia University)

1. Introduction

2. Pre-Lend Lease Act

3. Lend Lease

4. The Financial Negotiation with the US

4.1 The Major Moot Points

4.2 The Process Leading up to the Anglo-American Mutual Aid Agreement

Keynes’s Skeleton Plan (June 21, 1941)
On the latter part of “Article 7”
The Process Thereafter

4.3 Development after the AAM － Changed financial situation of the U.K. (Problem of increased sterling debts)

5. Keynes’s Observations on High Officials and Political Institutions

5.1 The Top Officials

President Roosevelt
Morgenthau, Treasury Secretary
The Feeling of Those Close to the President

5.2 Political Institutions － Fragile Relations between the Departments

6. Conclusion － On Keynes’s stance

[Appendix] Discussion with American Economists

[Abstract]

The main purpose of this paper is to examine the process of negotiation of the mutual aid agreement between the UK and the US during the years 1941 - 1943, and to clarify what sort of stance Keynes as a representative of the UK took throughout it.

Firstly we will explain the Lend Lease Act (March 1941), and proceed to how, after the Act, the UK came to conclude the Anglo-American Mutual Aid Agreement with the US (February 1942) through complicated negotiations. We will then assess Keynes’s fundamental stance, recognizable throughout these negotiations. This problem differs markedly in nature from the problem of the post-war international monetary system. The problem here was how to procure resources from the US amidst the financially and militarily dire situation – quite different from the atmosphere in which proposals for the future could be discussed.

Relations between the UK and the US were basically cooperative, and yet episodes of conflict often occurred due to geopolitical interests. Among other things, the UK took for granted the maintenance of the Sterling Bloc as the symbol of the British Empire, so that even if the UK got aid from the US, it aimed at a financial agreement which should as far as possible not interfere with the Bloc.

The fundamental line which Keynes took in the negotiation runs thus: The UK should always endeavour to keep resources at her own disposal. It is essential that the UK would be ready to preserve its independence by being able to use its own resources at any time when necessary. Keynes himself took maintenance of the Sterling Bloc for granted.

Loan Negotiations with the US (Draft) ― August 1945 – December Toshiaki Hirai (Sophia University)

                   

Loan Negotiations with the US (Draft)
― August 1945 – December

Toshiaki Hirai (Sophia University)

[Abstract]

It was on August 17, 1945 immediately after the end of the WWII that the Lend-Lease Act (LLA) was abolished. This was a snap judgment by President Truman, indicating the beginning of the so-called “Stage III”, ending the “Stage II (the period from the defeat of Germany to that of Japan). [*In the UK the Labour Party won the election, and Attlee became PM in July (-Oct. 1951), defeating Churchill. In the US Roosevelt died in April.]
  Faced with this emergent situation, the British Government held a cabinet meeting on August 23, based on Keynes’s proposal produced on August 13. Keynes himself attended it.
  On the next day, the delegation with Keynes as the top to the US was announced at the Commons. The delegation left for the US on August 27. 
  Concerning a financial negotiation with the US, there had been a negotiation leading up to the Anglo-American Mutual Aid Agreement (Feb. 1942) based on the Lend Lease Act (March 1941), followed by a further negotiation due to the change in political and economical situation. As Keynes was a representative of these negotiations, his selection above-mentioned was a natural course of event.
  What this chapter aims at is an examination of the process of the negotiation which run from late August in which a loan negotiation with the US started to the conclusion of “The Anglo-American Financial Agreements”1, and an evaluation of how Keynes showed his stance as a negotiator during these processes.

TOB

1. Introduction
2. Preparatory Stage: August

2.1  Proposals for Financial Arrangements in the Sterling Area
   and between the U.S. and the U.K. to Follow after Lend Lease

2.2 Some Highly Preliminary Notes on the Forthcoming Conversations: 9 September 1945

3. Favorable Phase

3.1 Top Committee (U.S.-U.K. Financial and Economic Negotiations Top Committee): September 13― 20

3.2 Favorable Proceeding: September 20 ― October 12

4. Offense and Defense of Tactics and the Stalemate Phase: October 12 ―November 18
5. Confusion and Outcome: November 19 ― December 6

5.1 Organizational Confusion and Lack of Understanding 
in the US side

5.2 Internal Conflict in the UK Side ― Cabinet Meeting vs. Delegation

5.3 Vinson’s Behavior and The Anglo-American Financial Agreement
   (December 6)

6. Chilly Response in the UK and Keynes’s Speech at the House of Lords

6.1 Chilly Response

6.2 Keynes’s Speech at the House of Lords

7. Conclusion