Foreign Relations of the United States: Diplomatic Papers, 1945, European Advisory Commission, Austria, Germany, Volume III

740.00119 EW/11–1445: Telegram

The Ambassador in France (Caffery) to the Secretary of State

Paris, November 14, 1945—midnight.
[Received November 15—12:20 a.m.]

6598. From Angell No. 59.

1. At tripartite meeting on November 13, I submitted following referendum on treatment of reparations from current production and commodity stocks in the Western Zone.

a. In placing [planning] the amount and character of capital equipment to be retained in Germany no provision should be made for reparation from current production. This proposal is consistent with the provisions of the Potsdam Declaration (III, B, 15, b and IV, 6).²⁵

b. Any surplus of current production or stocks above minimum requirements for (1) the German domestic economy, (2) exports to pay for necessary imports and (3) other prior charges, should be made available for reparation during a limited period to be determined by the Governments of France, the UK and the USA.

c. Any current production made available for reparations to claimants other than the USSR and Poland should be allocated according to a formula established by the present conference.

d. In view of the present German foreign trade deficit, existing commodity stocks should be exported only for cash.

2. It was agreed that only item c required formal consideration by the present conference.

3. Waley expressed general agreement with all points in our memorandum.

4. Rueff presented the view that if the possibility of reparation from current output were restricted to a “limited period” there would in fact be no such reparation. He felt this would also be the interpretation of the smaller countries and that this fact would be the cause of considerable disappointment.

5. Both Rueff and Waley pressed me for a statement of our position with respect to the period during which we would propose to make German surplus production available for reparation. Waley stated that the UK favored a period of 10 years with review of situation after first 5 years. Alternatively the UK favored a period of 6 years without qualifications. Rueff expressed no view.

6. Rueff and Waley also desire to know whether we favor treating occupation costs and accumulated import deficits as prior charges. Since these matters are now subject of departmental review I reserved our position. Waley stated that the UK wished to treat as prior charge all imports for the occupation forces other than strictly military items and pay of troops.

7. I urgently request instructions with respect to the questions raised in paragraphs 5 and 6. [Angell.]

Caffery

25. See Conference of Berlin (Potsdam), vol. ii, pp. 1504 and 1506.