Late in January 1933, President-elect Franklin D. Roosevelt met separately with his predecessor, Herbert Hoover, and Britain’s ambassador, Ronald Lindsay. Each session focused on one issue: How would the new chief executive handle the nagging problem of war debts?
During the war, the U.S. had advanced European countries about $10 billion in goods and credit. Following the July 1932 expiration of Hoover’s yearlong moratorium of payments, international readjustment discussions were scheduled for March 1933. European representatives hoped the new U.S. government would then articulate fresh policies. Many nations sought a sizable writedown of principal and interest because further postponement of due dates had proved politically impossible in the U.S.