740.00119 EW/7–545: Telegram

No. 366
The Representative on the Allied Commission on Reparations (Pauley) to the Secretary of State 1
top secret

2418. From Pauley to Secretary of State.

I have your cable of July 22 answering mine of June 19.3 As I read [Page 527] your message you agree with me in principle on all important points with the exception of two as follows:

You urge that any new tripartite percentage formula [for reparations from Germany] include at this time a fixed percentage for France even though France is not now represented in this conference.4 Maisky has insisted and still stands on the Crimea protocol5 that the conference remain tripartite. Both Mr. Harriman and myself as well as Archibald [Clark] Kerr and Sir Walter Monckton of Brit have constantly urged the inclusion of France in the Reparations Conference with Soviet officials to no avail. In the circumstances, your suggestion if followed would leave me in an impossible position. I would have only one alternative, namely, to sponsor a determination of the percentage share of France by the Tripartite Conference which even if accomplished would in the absence of the French obviously prove wholly unsatisfactory to and bring about criticism from the French. It is my considered opinion that my proposal which determines ex parte none of the claims of any nations shows adequate respect for and properly insures a reasonable determination of the claims of France and all other nations. Since France is on the Control Council, naturally under my proposal France would of necessity be the first nation whose claim would be considered and have its percentage determined. Certainly the matter of the inclusion of France as a member of the Reparations Commission should be made an urgent item on the agenda of the Big Three at the forthcoming conference. Obviously this is a matter which cannot be handled conclusively at any lower level. Accordingly, I request that you inform the President of my views upon this subject.
I have noted your exception to my proposal that we should demand as fully as possible gold as reparations. As this seems to be one of the few items which we can take, it occurs to me that the Dept should make further study of this matter, particularly since the receipt of gold as reparations may prove particularly convenient and useful for our country to defray occupation costs in supplying our army of occupation with such goods as are not obtainable within Germany.

  1. Sent over the signature of Harriman.
  2. Document No. 363.
  3. Document No. 356.
  4. i. e., the Allied Commission on Reparations.
  5. See vol. ii, document No. 1416, section v.