811.79641/11–2545
Memorandum of Telephone Conversations, by the Chief of the Aviation Division (Morgan)
At Mr. Clayton’s request, on Sunday, November 25 I got in touch by telephone with General C. E. Smith, President of American Overseas Airways [Airlines] and Mr. J. T. Trippe, President of Pan American Airways, and told them both that we had now received formal notice from the British25 that they were going to limit frequencies of the American carriers and also insist that rates charged by the American carriers be first cleared with the British Government. For the time being the British are limiting American Overseas to three frequencies a week and Pan American to the two frequencies a week authorized under the 1937 agreement, if Pan American charges the $275.00 rate which the British Government considers too low. If Pan American charges a rate which the British Government considers satisfactory, the British Government would consider permitting Pan American to offer some additional frequencies. If American Overseas charges a rate which the British Government considers too low, American Overseas will not be permitted to operate any frequencies.
I was to advise General Smith and Mr. Trippe that after careful consideration, the Department had decided that while it could not agree with the British on a set of principles which were contrary to ours, namely the control of frequencies, fixing of rates by governments and severe limitations on the Fifth Freedom, nevertheless under the circumstances all we can do is to tell the British Government that we recognize that our carriers cannot in the absence of an inter-governmental agreement operate into the U.K. except under such conditions as the British Government may prescribe, and we are prepared to have our carriers accept those conditions and operate on that basis for the time being. We should of course expect the British carriers, when ready to operate into the U.S., to comply with such conditions as we may prescribe.
I told the above to General Smith and Mr. Trippe. General Smith said that he was prepared to go along with that policy. He agreed [Page 233] with the Department that there seems to be nothing else we can do under the circumstances. Mr. Trippe demurred somewhat and said Pan American was in a very difficult situation and asked for an opportunity to discuss the matter with us. I told Mr. Trippe that if he could not approve of the actions we proposed, he would have to suggest an alternative as we could not ourselves see any. He said he would be in Washington on Monday, November 26’ and would get in touch with me immediately.
- Reference is to an aide-mémoire dated November 19, from the British Embassy, not printed, as elaborated upon informally in a letter, also not printed, of November 24 from the British Civil Air Attaché (Masefield) to the Chief of; the Aviation Division (Morgan).↩