740.00119 E.W./8–1345: Telegram
The Ambassador in the Soviet Union (Harriman) to the Secretary of State
[Received August 13—4:56 p.m.]
2881. From Pauley. The French representative Rueff has not officially accepted the Berlin Protocol and has made reservations as [Page 1255] to their participation in conference here in Moscow. Rueff has stated that he would like to know what the French are going to receive as reparations before he agrees to the Berlin Protocol. I pointed out that this was still a matter of negotiation between ourselves, British, French and other nations entitled to reparations from the Western Zones and that he, like ourselves and the British, would have to take his chances in that respect. He is also extremely anxious to have us arrive at a definition of restitution. Since I have always felt that the question of restitution should be resolved by the Reparations Commission I introduced a definition of restitution for discussion. The definition I submitted in [is?] the last one prepared by Clayton, modified in accordance with the State Dept’s wire numbered 1770, August 8.71 The Soviet representative was not willing to discuss restitution and stated that while he would take it up with his Govt he thought it might be better handled by some Govt agency other than Reparations. Rueff objects to our definition primarily because it does not include gold and securities. I told him that inasmuch as the Soviets had waived any right to gold this was a matter which could be later discussed outside of Moscow with the French, UK and other interested nations. I strongly recommend to Secretary of State that we not restitute gold or securities until final agreements have been made respecting all reparations and an export-import plan formulated to enable the United States to receive payment for current imports such as those now being taken from Army stocks for delivery to the British and French in order that coal can be produced. I am fearful that if we do not watch our step we will again find ourselves in the same position as after the last war when we paid for reparations going to other countries. I would appreciate information from you as to whether any arrangement has been made for payment of coal72 which is being shipped out of Germany and for food and coal from the United States to Western Europe. [Pauley.]