The continuance of lend lease in its earlier framework, with the addition of the Combined Boards, did not remove the problems of the ‘old commitments’, the level of Britain's exchange reserves and the disclosure of the reserve levels to Congress. Nor did the signing of the Mutual Aid agreement settle the position regarding reverse lend lease, where the principles applicable to the overseas sterling area became entangled in the problem of Britain's rising overseas indebtedness.

The negotiations concerning the ‘old commitments’ dragged on until May, finally resulting in American concessions worth $292 million. Although this amount was well below that which Keynes had attempted to obtain in Washington in 1941, it effectively removed the problem of dollar inadequacy in so far as Britain's immediate needs were concerned. However, it did not resolve the problem of the appropriate level of Britain's reserves, given her growing liabilities and prospective post-war needs, nor the problem of how best to present the existing situation to the Americans so as to avoid the twin dangers of political pressure for cuts in lend lease and possible distrust of sterling and a consequent unwillingness to continue accumulating sterling balances elsewhere.

Keynes's 1941 attempts to prevent publication of Britain's reserves which culminated in his memorandum of 31 December (above pp. 214–18) led to instructions to Sir Frederick Phillips to try the case on Mr Morgenthau and Mr Bell. […]