Paris Peace Conf. 184.011102/88: Telegram
Mr. Albert Halstead to the Commission to Negotiate Peace
[Received July 3—10:30 a.m.]
532. Minister of Finance indicates that there is no intention to retaliate against American Companies and promises release funds American Companies which bank declined permit company to draw. See my telegram 529.8
I am reliably informed Italians are purchasing Vienna owned shares Galicia Oil Companies which in one instance gives control. Italians alert and active. British, French rather slow and Americans asleep. Opportunities to invest American money to secure profitable opportunities which would help stabilize conditions should not be neglected. Comparatively small capital considering rate of exchange necessary. At Konigsberg [least?] investigations opportunities should be made without delay. Repeat this paragraph Department of State.
Finance Secretary states German influence already working for union with Germany to prevail [prevent?] Danube Confederation. Bauer and his party favor union Germany as support their Socialistic policies. Finance Secretary declares harsh treaty will force that union but first leaning toward Bolsheviki through despair and that he and Bauer agreed better lay [lean?] to Bolsheviki when it becomes inevitable and prevented reaching criminally [to?] depth of Hungarian Communism. That Finance Secretary would be liable join such movement doubtful but he at least would have some sympathy therewith if peace treaty absolutely crush this country. Am compelled to emphasize my views formed after careful study conditions and not overinfluenced by conversations intended to convert me to that view that very severe terms to German-Austria make her union with Germany certain. Plan already begun to have German-Austria adopt immediately after peace generally speaking [German?] civil and commercial laws and perhaps money so as to bring them closer together. In all circumstances natural state conditions is toward Germany which only close commercial intercourse with new states can prevent. Such union Danube states would naturally strengthen position Czechoslovakia whose future would be impossible with hostile Germanic people.
Many conservatives believe Government Socialists are driven to Communism because Provinces will not permit successes their socialization [Page 537] schemes. With Communism they would expect coerce peasants to their interests. Because Government must be in approved connection with workmen it is difficult for it to combat Communism by force. Workmen council postponed consideration proposition that it be recognized in constitution. Delay of this decision while tending difficulties at Königsberg [to at least?] delay Bolsheviki and once [is?] encouraging it paralyzes business and manufacturing by postponing resumption usual activities though [through?] uncertainty future.
- Dated Vienna, July 2, 1919, 4:20 p.m.; received July 3, 10:30 a.m.: “Banks have refused several American citizens right draw on account retaliation as reported for seizure of German-Austrian property abroad. Indication that with one American company policy may be changed. Will report further. …” (Paris Peace Conf. 184.011102/86).↩