Foreign Relations of the United States, 1946, Council of Foreign Ministers, Volume II

C.F.M. Files: Lot M–88: Box 2063: US Delegation Minutes

United States Delegation Record, Council of Foreign Ministers, Second Session, Fortieth Meeting, Palais du Luxembourg, Paris, July 11, 1946, 4 p.m.¹³

Paris, July 11, 1946, 4 p.m.

secret

Future Meetings of the Council

M. Molotov opened the meeting and asked if there were any report from the Deputies.

Mr. Byrnes said that he understood that there would be no report of the Deputies until the next day, but that there was a report from the special committee on the Italian colonies.

M. Molotov stated that he did not have the Russian text of that report and that he could not discuss it until it had been translated.

Mr. Byrnes suggested deferring consideration of the report until the end of the meeting or until the end of the next meeting.

M. Molotov wondered whether they could consider the question of the date of the termination of the present session of the Council of Foreign Ministers. Could they not finish their work tomorrow?

Mr. Byrnes said that he would not like to commit himself at the moment to that suggestion. The Council had not finished its discussion on Germany, and he wished also to discuss Austria as he had stated on the first day of the session. He thought, however, that they should be able to finish on Saturday.

M. Molotov suggested holding two meetings on Friday. He did not object to discussing a number of questions on Friday, including the question of Austria. They would have been in session four weeks and would be meeting again soon.

Mr. Byrnes agreed to hold two meetings the next day.

Mr. Bevin said that if they were going to meet twice the next day, they had better meet fairly late in the morning and give the Deputies time to meet first.

M. Bidault said that the French Delegation had no objection to holding two or even three meetings the next day, but he would have to ask that the Council agree that M. Couve de Murville, his Deputy, should represent France when he was absolutely forced to be absent.

M. Molotov thought that M. Bidault’s proposal was acceptable, and also the proposal of Mr. Bevin that the Deputies meet early the next morning and the Ministers meet at 12 o’clock noon. (All delegations agreed to these proposals.)

German Questions

M. Molotov proposed that the Council go on with its discussion of German questions. Did anyone have any remarks to make?

Mr. Byrnes made the following statement:

“The American Government has never sought to impose a peace of vengeance upon Germany. The American Government regards the economic revival of Germany as essential to the economic revival of Europe. It favors the industrial revival of Germany on peaceful lines. It does not favor and has never favored, however, giving to the economic revival of Germany priority over the economic revival of countries Germany has devastated.

“The American Government has supported and will continue to support the necessary measures to denazify Germany and to give the democratic forces in Germany the chance to assert themselves. But the American Government does not believe that the democratic forces in Germany can assert themselves unless they are given a fair chance to do so.

“The American Government is convinced that the way to give the democratic forces in Germany the chance to assert themselves is for the Allies to make clear to the German people the essential terms of the peace settlement which they expect the German people to accept and observe.

“The Allies should make clear just what the disarmament which they expect the German people to observe means. They should make clear the reparations deliveries which they expect to exact so that the German people will know that the harder they work the sooner they will be permitted to share in the benefits of that work.

“The Allies should make clear to the Germans what the future boundaries of Germany will be and the limits within which the Germans may govern themselves. They should make clear to the Germans that so long as they observe clear and definite standards laid down by the Allies there will be no interference with their efforts to rebuild their economic and political life for the benefit of themselves and of Europe as a whole.

“Talk of a long or a short occupation is misleading. Controls and small security forces must be reserved for a long period of time to ensure Germany’s observance of the terms of the agreed settlement. But mass occupations and occupation governments of Germany if extended over a prolonged period will defeat our purposes. The Germans are at best going to experience difficulties and hardships. They must be given a chance to minimize those difficulties and hardships by their own efforts. If they are not given that chance, they will ascribe their difficulties and hardships to the Allied occupation and not to the devastating war of aggression which their leaders brought upon them and the world.

“It is therefore the duty of the Allies to set up the machinery to work out the definite lines of the peace settlement which they expect Germany to accept and observe. I urge upon my colleagues that we should appoint Special Deputies for this purpose and give them directives.

“If we fail to do this, we will be confessing to the world our own lack of constructive purpose and our inability to agree and will betray the millions who died in order that freedom might live.”

M. Molotov said that the Soviet Delegation’s view had been given by him yesterday and that he would summarize it again. Only recently views had been expressed concerning the future of Germany and a peace treaty with Germany. These views had been stated by certain delegations but not by all delegations. It was well known that the Soviet Delegation had explained fully its views on this subject. The position of the French Delegation was also known. The same could not be said of the British Delegation, and the attitude of the U.S. Delegation was not at all clear. In these circumstances it seemed inexpedient to refer these questions to the Deputies. The Council had not settled them to the point where they could be transferred into the hands of others. It would be right for these questions to be settled first by the Council itself. The Soviet Delegation thought it would be appropriate to set some later date, before the end of the year, for a special session of the Council of Foreign Ministers to examine the question of Germany. On that occasion they might be able to work out a basis of settlement of the German question. When that had been done, they could refer the matter to the Deputies, and no doubt the latter would then be able to work it out successfully.

M. Molotov stated that he wished also to take this opportunity to elucidate the question of reparation. He had pointed out in his statement that the Soviet Government had hoped that the amount of reparation to be paid by Germany to the Soviet Union could be fixed at $10 billion. In mentioning this he had referred to the decision of the Crimea Conference, which had not been published but embodied in the Protocol of that Conference. He felt it necessary to set forth the contents of that section of the Protocol which had been signed by Mr. Churchill, Mr. Roosevelt and Marshal Stalin.¹⁴ It defined the main terms of reparation in four paragraphs. He would give a brief summary of the first three paragraphs and the full text of the fourth. The first paragraph stated that the damage caused by Germany should be indemnified in kind. The second paragraph stated that reparation should be exacted from Germany in three forms:

a) Once-for-all removals of equipment, tools, etc.;

b) Annual deliveries of commodities;

c) German labor.

Paragraph 3 stated that a detailed plan for German reparation would be drawn up by the Allied Reparation Commission. Paragraph 4 read as follows:

“With respect to the determination of the total amount of reparation as well as its distribution among countries which suffered from German aggression, the Soviet and American Delegations have agreed that the Moscow Reparation Commission in the initial stages of its work shall take as a basis for its discussion the Soviet proposal to the effect that the total amount of reparation in accordance with paragraphs (a) and (b) of Article 3 to be paid shall be fixed at $20 billion, and one-half of that sum shall be paid to the U.S.S.R. The British Delegation holds the view that pending an examination of this question by the Moscow Separation Commission no definite figures for reparation can be named. The Soviet-American proposal is to be referred to the Moscow Separation Commission for examination.”

M. Molotov continued that in his statement of two days before, he had reminded his colleagues of the Protocol of the Crimea Conference and had also recalled the way in which this question had been raised.

Mr. Byrnes said that he had been talking about what efforts could be made to advance the peace, but that the Chairman was back on the question of reparation again. However, if the Chairman desired to discuss reparation, he (Mr. Byrnes) would discuss it. It was true that at the Crimea Conference M. Maisky had presented a statement and had suggested a figure of $20 billion in reparation, $10 billion of which would go to the Soviet Government. The text read by M. Molotov showed what President Roosevelt had agreed to. He had agreed only that the Separation Commission should in its initial study take as a basis for discussion the proposal of the Soviet Government. The Protocol said that the Soviet-American proposal had been passed to the Moscow Separation Commission as one of the proposals to be considered by the Commission. In good faith the American Representative on the Separation Commission had gone to Moscow. On July 3 he wrote a letter to M. Maisky, the first paragraph of which read as follows:¹⁵

“I was informed this morning that for the third time you again postponed the scheduled Plenary Meeting of the Allied Commission on Separations. As in the case of the other postponements, this Plenary Meeting was scheduled to discuss your original Memorandum No. 2 which embodies the Soviet Proposal referred to in the Crimea Protocol. The American Delegation has now been here 22 days. We have not received a single figure supporting the Soviet proposal nor has any attempt been made on the part of the Soviet Government to enlighten either the American Delegation, or so far as I know, the British Delegation as to the basis of this Soviet Proposal.”

After complaining of the lack of progress, Mr. Pauley’s letter continued as follows:

“At the time you made your twenty billion dollar proposal at the Crimea Conference, none of us had access to Germany. Any money figures which may have been discussed then could only have been based upon pre-war data of a very general character. Now we are in a position to undertake a complete physical inventory of present German assets and to make reasonably accurate estimates of future German requirements for whatever minimum standard of living may be agreed upon. Only by deducting permitted future German minimum requirements from the sum of actual present assets and estimated future production, can realistic net reparation figures be reached.”

Mr. Byrnes said that he need not read at greater length from this letter. It was dated July 3. When the Potsdam Conference met on July 14, the Soviet Delegation had had no figures to justify the proposal it had previously made. At Potsdam Marshal Stalin had agreed to the reparation program which was set forth in the Potsdam Agreement and not to an ex parte statement made by Mr. Maisky at the Crimea Conference five months earlier. Mr. Byrnes thought that they had certainly heard enough about standing by the Berlin Agreement and that they could all agree that they must stand by the reparation agreement which had been made at Potsdam as well as all the other agreements. It had been agreed there that reparation for the Soviet Government should come from the Soviet Zone in Germany except as was provided in the agreement, for limited deliveries of plants from the western zones and for German assets in certain foreign countries. He knew that there was no way of appraising the reparations that had been obtained from the Soviet Zone in Germany. He did not suppose that the Soviet Government had any way of doing it. But the Soviet Government had received, as a result of the agreement reached at Yalta, territory which was formerly part of Poland, and Silesia had been taken from Germany and given to Poland. The taxable property in Silesia was worth $11,300,000,000. It had been agreed also that the Koenigsberg area should be given to Russia and the taxable property there was worth $2,500,000,000. The Allies had been endeavoring as far as possible to cooperate with the Soviet Government in securing reparation, and were going to continue to do so in accordance with the agreement reached at Potsdam if the whole Potsdam Agreement was observed.

Mr. Bevin said that he could not understand M. Molotov’s remark that the British Goverment had not made its position clear. He thought he had made it perfectly clear in the statement he had made the previous day covering the whole of the German problem. He had said that, in the first instance, the Potsdam Agreement should be carried out. At an earlier meeting, when they had discussed the problem, he had put forward a proposal that the frontiers of Germany should be fixed. Like M. Bidault, he wished to know what the new Germany was to be. Once the frontiers had been fixed, he assumed that they would proceed on the basis that certain limited functions in Germany would be centralized pending the final setting up of a central German government. The British Government had an open mind about the question of a federal Germany or a centralized Germany. They would favor leaving wide powers in the hands of the provincial administrations and opposed rebuilding of a closely knit German state such as existed before the war. That was the British approach to the problem. He had also stated in the previous meeting and in the British Parliament that his government was ready to support France on the question of the Saar and that that question should be settled at the same time as the other question. The British Government was also very anxious to arrive at a mutually satisfactory solution on the question of occupation of the territory west of the Rhine, a solution which would be in the interest of French security without providing for annexation of that territory to France. On the question of zone, before he could carry that matter any further, he wished to know what the nature of Allied control over German industry was going to be. He noted that M. Molotov had said on the previous day “in particular the Ruhr”. The U.K. Delegation could not be a party to such a solution. Whatever scheme was devised for the control of German industry, it must be on the basis of reciprocity throughout Germany. For that reason he had circulated three proposals the previous day¹⁶ which were intended to make a beginning in carrying out this principle in accordance with the Potsdam decision. He asked for a decision at the present meeting on whether they could instruct the Control Council to proceed on that basis in accordance with the Potsdam Agreement.

With reference to the paper¹⁷ circulated by M. Molotov at the previous meeting, Mr. Bevin said that he noticed that the Soviet Delegation wished to limit the investigation. He (Mr. Bevin) wished to repeat what he had said before, namely that if there was an investigation, it must include the investigation of the manufacture of war materials and other industries in all zones, so that they might be satisfied that they were carrying out the Potsdam Agreement. He could not be a party to limiting the investigation as M. Molotov had suggested.

On the subject of reparation Mr. Bevin agreed with Mr. Byrnes. He saw no need to repeat the arguments. What Mr. Byrnes had said coincided with the documents which the British Delegation had and with his understanding of the agreements which the British Government had arrived at in Potsdam.

On the subject of coal, Mr. Bevin was willing to agree that the representatives of the Four Powers on the Control Council in Germany should be instructed to make an investigation and to report to the Four Governments not later than August 10 on the following points:¹⁸

1. Measures to increase the production of coal in Germany.

2. General principles to govern the allocation of the coal output as between coal for consumption in Germany and coal to be made available for export.

Mr. Bevin proposed also that the Council of Foreign Ministers agree to discuss this report at a future meeting.

M. Molotov said that the Reparation Commission had been mentioned. It had begun its work in Moscow but had been transferred to Berlin last September at the suggestion of the U.S. Government. The Soviet Representative had waited two months in Berlin for the arrival of the representatives of other governments in order to continue the work of the Commission. He was finally compelled to return to Moscow. Now it was the middle of July, but the Commission had not been able to resume its work.¹⁹ The decision of the Berlin Conference on reparation has also been mentioned. He wished to call attention to Paragraph 5 of Section IV which dealt with reparation from Germany. This paragraph said that the amount of equipment to be removed from the Western Zones on account of reparation must be determined within six months from that date at the latest. Twelve months had already passed, but no plan for reparation had been drawn up; thus this decision had been grossly violated. The same decision of the Berlin Conference said that prior to the fixing of the total amount of equipment subject to removal, advanced deliveries should be made of equipment. The Allies had drawn up a plan for the Western Zones without the participation of the Soviet Government. Under this plan there had been allotted only 3½% of what had been assigned to the Soviet Union. Mr. Bevin had stated that he was in favor of the full execution of the Berlin decisions, but he had submitted a proposal which, if one looked at it closely, was obviously in conflict with the Berlin decisions as well as with what Mr. Bevin had said in his statement concerning the full execution of those decisions. If the Berlin decisions were to be put into effect, then under them deliveries of 15% from the Western Zones to the Soviet Union should be compensated for by corresponding deliveries, from production of the Soviet Zone in Germany, but in view of the fact that this decision of the Berlin Conference was not being carried out, no exchange of commodities was taking place. It could have taken place if the Berlin decision had been carried out. M. Molotov said that he had in mind paragraph 4, subparagraph (a) of Section IV of the Berlin Agreement.²⁰

M. Molotov stated that the question of coal which had been raised by the French Delegation was very important.²¹ What was the present situation? Unfortunately the Soviet Government had no comprehensive information, but the fragmentary information available was sufficient to illustrate the state of affairs. It was reported that while before the war the coal output was 10½ million tons per month, in the last month it had only been 3½ million tons, about 35% of the pre-war level. On the other hand, in the Soviet Zone of occupation the coal output was 9,700,000 tons prior to the war and now was 8,900,000 tons; thus it was now 91% of the pre-war output. He thought it would be advisable to publish each month the data on coal production in all the zones of Germany, and also that measures should be taken to raise coal production in all zones since coal was needed not only in Germany but also in neighboring states.

M. Molotov wished to add a few words concerning the proposal of the Soviet Delegation for the establishment of two commissions. He thought that it would be appropriate to carry out an investigation concerning the progress of the disarmament of German armed forces and the disbandment of military and para-military organizations in all zones of occupation. Secondly, it was necessary to set up a commission to draw up a plan for implementing measures to liquidate German industries which could be used for military production. No such plan had yet been drawn up. Therefore there could be no implementation of a decision which had not yet been taken. The Soviet Delegation was insistent that at this time a decision be taken to check up on the disarmament of Germany and that therefore instructions be given to draw up a plan which would ensure the taking of measures to verify the situation both on disarmament in Germany and the liquidation of German war industries. It was not possible to create the impression that there was such a plan already or that appropriate measures had been taken to eliminate German war industry. It would be incorrect to have any illusions on that point. Therefore it was necessary to draw up a plan as soon as possible and to see that this plan was carried out in practice. That would be the correct solution of this question.

Mr. Byrnes thought that the various statements which had been made covered quite a number of subjects. With reference to the suggestion of the Chairman concerning reports on the production of coal, the Control Commission in Germany published every two weeks a report on coal production in each zone, this information being supplied by the military authorities of each zone.

M. Molotov asked whether there were any data on the output of coal in the Ruhr Basin.

Mr. Byrnes said that the report gave data for all zones. For twenty-five days in May 4, 215,000 tons of coal were produced in the British zone. The report from that zone to the Control Council broke this figure down into the production of the respective districts.

Mr. Byrnes referred to the impression of the Soviet Delegation that there was no plan concerning Germany’s war potential. The Control Council had a commission which was concerned with the liquidation of the German war potential. That commission was supposed to be in session all the time. The Soviet Delegation had said in April and again now that nothing was being done about this question. That was just what should be investigated. The Allied Military Commissioners had on June 5, 1945 announced a plan which provided for the destruction of German war material. With reference to the proposal of the Soviet Delegation, the U.S. Delegation had no objection to the first paragraph which provided for an investigation to see whether the German armed forces had been disarmed. It did object to the second paragraph and wished to propose a substitute for it. This second paragraph made provision for drawing up a plan, but already, on June 5, 1945, the Four Powers had agreed to dismantle German war industry. Therefore the following text was suggested by the U.S. Delegation: “The Allied Governments on June 5, 1945 agreed not only to disarm the armed forces of Germany but to destroy the plants engaged in the manufacture of weapons of war.” The Foreign Minister of the Soviet Government, in a paper addressed to the Council of Foreign Ministers, had said that no real measures had been taken to deal with Germany’s war potential. Therefore we proposed that a special commission be authorized to go into each of the four zones and ascertain whether the information of the Soviet Foreign Minister was correct and if following the decision of June 5, 1945, war materials have been or are being manufactured in Germany. There was one matter which definitely needed to be cleared up. The statement had been made that in the American Zone the U.S. authorities had failed to carry out the agreement. The important thing was to find out whether or not Germany’s war potential was being destroyed. If the Germans were deprived of all weapons, they would not do much harm; but if war weapons were being produced in German factories and no measures were taken, that would present a serious situation. That would present a serious situation if it were true. If it were true, they should take steps to see that it was stopped. How could they say that no proper measures had been taken to destroy German war potential unless they sent a commission to find out if that were so. The principal American representative in Germany had supplied information that forty plants had been destroyed 100% for no reason other than that they were war potential of Germany. A large number of other plants was in the process of being dismantled. In view of those circumstances, he (Mr. Byrnes) was unwilling to accept the statement that nothing was being done in the American Zone, and he was willing to have representatives of the other Allied Governments come into the American Zone and look at the situation there. Let them find out the facts, then if there was need for a plan, they could draw up a plan, but it was useless to keep on making agreements if they were not to be carried out. He wondered if they could not dispose of this question by reaching agreement to have an investigation. If they could not, they should go on to the next question.

M. Molotov assured Mr. Byrnes that certain industrial plants had also been dismantled in the Soviet Zone and some had been removed from Germany, including war plants. Mr. Byrnes had referred more than once, at the Berlin Conference a year ago, to this fact. In June, 1946 the Soviet Representatives in Berlin had submitted a memorandum criticizing the activities of the Commission for the elimination of Germany’s war potential. The memorandum pointed out that the Commission had failed to draw up a plan for the elimination of German war industry. It had only adopted certain general principles prohibiting certain branches of certain German war industry. What was required was not a general decision like that of June 5, 1945, but a detailed plan for the elimination of the German war potential. When they had that plan, they would be able to say when the task could be completed. Could such a plan be produced at the table right now? It could not since no such plan existed.

M. Molotov asked what the U.S. Delegation wished to investigate when there was no such plan. The attention of the Soviet Delegation could not be diverted to trifling things while the drawing up of a plan for the elimination of Germany’s war potential was always put off. The Soviet Government could not consent to that. In November, 1945 the Soviet Representative in Berlin had made the suggestion that an investigation be carried out to see whether any German military formations existed in the Western Zones of Germany. Up to the present the Soviet Government had not succeeded in having this investigation carried out, despite the fact that the reports upon which the demand was based were correct. Nine months had now passed and still there had been no investigation. All sorts of trifling excuses had been found to divert attention from this question and to postpone an investigation. The Soviet Delegation believed that an investigation of the existence of German military formations in the Western Zones should not be further postponed and also that a plan should be drawn up without delay for the elimination of the German war potential. Certain definite time limits could be set, for example, one or two months. The work could then be carried out in a serious way, and it would then be known how the general decision of June 5, 1945 had been carried out.

Mr. Bevin said that in his statement at the previous meeting he had indicated that reports had been received to the effect that war material was in fact being manufactured in the Soviet Zone. Whether this was true or not, he did not know. He had not accepted those reports, but the British Government was interested in finding out about the activity of war industries in the Soviet Zone just as the Soviet Government was interested in finding out about military formations in other zones. The British Government had published a report on the disbandment of such formations in the British zone. The proposal now made by Mr. Byrnes covered both points. It provided for an investigation with respect to military formations and also met the point, which the British Government considered important, concerning the investigation of war industries. The acceptance of this proposal would establish a basis for settling both matters in the near future. For that reason the British Delegation supported Mr. Byrnes’ proposal.

M. Bidault stated that he wished only to make a suggestion. He had the impression, with due respect to the Council of Foreign Ministers, that they were on a merry-go-round. In those circumstances he was going to ride his own horse and say something about coal, but he wished first to touch upon another point. If his information was correct, and he thought it was, lists of war plants to be dismantled had already been drawn up by the Control Council in Berlin last year. The question accordingly arose whether those lists were wrong or inadequate. Was this work already done to be overlooked or reversed, or had the decision not been carried out? It seemed to him that this was a factor which shed some light on the problem. It might show them exactly where they were and stop the merry-go-round. In addition, certain manufactures had already been prohibited. The question therefore arose whether those products would still be manufactured and if so, what means were contemplated to put a stop to it.

Mr. Byrnes wondered whether they could not avoid what M. Bidault had called a merry-go-round by disposing of the question before them. The United States Delegation would agree to investigation on both questions, that of the armed forces and that of war industry. As he understood Mr. Bevin’s position, the latter also agreed, and this appeared also to be the position of the French Delegation. If the Soviet Delegation would agree, they could have the investigation on both subjects. If it did not, they could go on to the discussion of another question.

M. Molotov said that he would like to be shown a list of the plants which were to be dismantled. Did such a list exist in fact? The Soviet Delegation proposed that this question not be postponed but be decided immediately. It suggested that the question of the elimination of German war industries should be solved not separately in each zone, but on the basis of an obligatory general plan for all four zones. The Soviet Delegation suggested that lists be drawn up of the war plants that were to be destroyed and the time limits be fixed for that destruction. The appropriate decisions should be adopted by all four governments and the results verified. It was not possible to imagine that there was a concrete plan already for the elimination of all German war industries and that all that remained to be done was to investigate. To say that would be to deny reality. Actually there was no plan. Therefore the Soviet Delegation suggested that a plan be drawn up without delay and that the time period of one or two months be set for its execution. The German war industries would be eliminated and no one would have any doubt that the matter had been carried out in accordance with the decisions of the Four Powers.

Mr. Bevin stated that as far as he was concerned, he could not go further than to ask for an investigation of whether war material was being manufactured at the present time. In view of the accusations which had been made against Great Britain and other Allied Powers on the previous day, he really thought that an investigation was necessary. Grave reflections had been cast on Great Britain by the very fact that it had been proposed to set up an investigation. For his part, he was willing to have an investigation on both questions as Mr. Byrnes had proposed. If the British Government was wrong, it would take the consequences. Questions had been put to him on what was being done and reflections had been cast on the British Government. In fairness to the public men who were responsible for carrying out their agreements, he wished to submit that they should have an investigation and either be proved wrong or else have a clean bill. If it was the case that accusations had been made and the British Government had been willing to have an investigation under both heads, and such an investigation was refused, he thought the world could draw its own conclusions.

M. Molotov recalled that on the 20th of November, 1945 the Soviet Representative on the Control Council for Germany had made a proposal to carry out an inquiry into the elimination of the remnants of the German armed forces in all the zones of Germany. Up to July 11, 1946 they had failed in their efforts to obtain a reply to this question. Such was the attitude of certain powers on this simple question. In addition, the Soviet Government was now proposing that a plan be drawn up for the elimination of war industries in all four zones. This question was being postponed. The Soviet Government did not understand the postponement of either the first or the second question. The world public would form its own opinion on these two questions.

Mr. Bevin stated that he wished to correct a wrong impression. M. Molotov had made a statement several times and he (Mr. Bevin) had just been able to check up on it. The proposal which the Soviet Representative had made in November 1945 was for an inquiry into the disbandment of German armed forces in the British zone. The British Government had agreed provided that the inquiry cover all zones and that it would be a precedent for other inquiries. At a later date the Control Council had decided that instead of pressing for that general investigation, it would request each zone commander to report on the disbandment of the Wehrmacht in his zone.²² That had been done. Therefore the British position was the same as it had been last November. If there were to be charges made and suspicions entertained, and if there were to be investigations, the latter must be on all the subjects in question and in all the zones, not in one zone alone.

M. Molotov asked whether the Council could at least accept paragraph 1 of the Soviet proposal. Even then they would have reached no agreement at all on the question.

Mr. Byrnes suggested going on to another question. He called attention to the fact that, if there was any intention to take matters in order, he had brought up as the first point at the present meeting the question of the appointment of special deputies for German questions. The U.K. and French Delegations had agreed at the previous meeting to this proposal, but the Soviet Delegation had not. He hoped that M. Molotov could agree to it now.

M. Molotov said that he could only repeat the views he had stated yesterday and ask what the Deputies would do since the Council would have given them no basis on which to work. Let that basis be worked out in the Council of Foreign Ministers. A special session could be devoted to the preparation of that basis.

Mr. Byrnes said that if the Soviet Delegation would agree, they could each appoint a representative at once, the latter could meet in the morning and draft a few paragraphs setting forth the scope of the inquiry which the special deputies would make. The Council could look at this report the next afternoon, supplement and modify it if necessary, and the basis would be established. The Deputies would be able to start their work at an early date. If they could not reach agreement on it tomorrow, they might do so on Saturday, and thus they would have made a significant step in this important matter.

M. Molotov stated that insufficient preparation had been made for such rapid action. Why did Mr. Byrnes refuse to hold a special session of the Council of Foreign Ministers to discuss the German question and work out a basis for its settlement? At such a session they could lay the ground work for the work of the Deputies. At present they had not even arrived at a common view on the fundamental questions. He did not understand what the Deputies could discuss at the present stage. All realized that the German question was a serious one. Why should they not hold a session of the Council in November to deal with the question?

Mr. Byrnes said that he had never objected to the holding of a special session. What he wanted to know was why they should put off until November what they could do today. The Council was in session now. Two months ago he had made the suggestion, in the hope that M. Molotov might agree, that special deputies be appointed. If he had agreed, they would now have a report from those deputies which would enable them to start work on this important problem. The Council was in session now. It would not take very long to frame terms of reference if that was what the Soviet Delegation had in mind. What he (Mr. Byrnes) feared was that when November came and he proposed that they take up this question, the Soviet Delegation would propose referring it to the Deputies and another five months would pass before they got to work. He would like to get to work now.

M. Molotov said that he did not know on what Mr. Byrnes’ assumption was based as he saw no reason for it. The Soviet Delegation had already explained in detail its views on all aspects of the German question. He would like the other delegations to do likewise. The views of the U.S. Delegation were not clear and those of the British Delegation had not been set forth. Mr. Bevin had referred to what he had said here and in Parliament, but the Soviet Delegation had no idea of the attitude of the British Government on the German problem. If it were possible to say that there were certain views which could be accepted as a basis for proceeding, the Council could charge special deputies to produce some concrete proposals, but there was no such basis. Without it the mere definition of formal terms of reference would serve no purpose, and the matter would not be advanced. It would be an attempt to get rid of a task which the Council was called upon to undertake. It would be placing on others the task which it was the Council’s duty to carry out.

Mr. Byrnes wished to say that they had found since last September that they could let the Deputies work on the five peace treaties. The Deputies had kept in touch with the Ministers and knew the positions of their respective governments. They were able to discuss the issues and to narrow the differences, thus simplifying the situation confronting the Ministers when they met. The same could be done in the case of the German question. The Deputies had met and had discussed the boundaries of Italy and had worked out agreements. When they could not agree, they brought the issues in concrete form to the Foreign Ministers. In the case of Germany the special deputies could consider the form and character of the government to be established in Germany and controls to be exercised by the Allied powers. Then when the Ministers met later, they could hear from the Deputies on those issues and possibly reconcile the differences.

Mr. Bevin suggested to M. Molotov that it would facilitate the work of a later meeting if they had a preparatory commission, if the idea of appointing deputies was unacceptable. Various governments would be sending in proposals, many of which would be similar. It would facilitate matters if a preparatory commission could pull together all this material and present it in ordered form when the Ministers meet. The commission would not have power to reach agreements but only to prepare the work of the Ministers. When the latter met, they would have something already set up on paper and could see clearly the actual differences of approach to the various problems. In that way they could probably save themselves considerable delay in reaching solutions. The points made in the statements which had been made by the various delegations in the last few days could be turned into actual proposals which might appear before the Council in draft form. This would make much easier the work of the Council when it met.

Mr. Bevin felt that a great deal of experience had already been gained through the work of the Control Council in Berlin. Useful information and ideas regarding administration of such problems could be collected from the records of the Control Council. In spite of the difficulties which had arisen in the functioning of that body, he thought that on the whole they had done a very good job. A preparatory commission could make use of the experience gained thereby. On the difficult problem of provincial government, for example, the Soviet authorities had used one method, the American authorities another, and the French authorities another. In the British Zone they were just now considering trying to adopt some workable method. Out of this experience, if the reports could be looked at, a method might be found which would help the Four Powers to work out a sensible system of decentralization in Germany. There were other similar subjects such as administration on which material was available, which a preparatory commission could use.

Mr. Bevin stated that a heavy responsibility rested on the Council of Foreign Ministers, but that other governments who had fought Germany were also extremely keen on what was going to happen there. They were following the German question more intensely than those of Italy and the Balkans, because most of them had been up against two wars within a very short time as a result of German aggression. Anything which the Council could do to make the preparation of its own work more effective would be helpful to the Council itself and also to those other governments.

M. Molotov said that he took note of the fact that Mr. Bevin and Mr. Byrnes were continuing to press for the naming of deputies to start work on Germany. He wondered why they would not take the initiative and formulate proposals on the German question. Up to the present they had not submitted proposals reflecting in concrete form the views of their respective governments. He understood Mr. Bevin to propose that the Deputies should formulate proposals expressing the various viewpoints held by their respective governments and should present these proposals at the next session of the Council. In the Soviet view it would be more correct for the Ministers to set forth the views of their governments on the German question. These views could then be examined at the next session, when decisions could be taken. Accordingly, he thought it would be correct for the Council to fix a month in which it should meet to examine the German question, and that they should reach an understanding that for that session they should prepare in concrete form their respective proposals.

Mr. Byrnes said that it was evident that they approached the matter in different ways. It was his view that they should first find the facts and then reach conclusions based on the facts, instead of first stating the conclusions and then finding the appropriate facts to support those conclusions. It was plain to him that they could not reach a decision. He knew that the Council could not take any action except by unanimous agreement. He was willing and anxious to have a meeting of the Council to consider German questions any time, the earlier the better. He thought that some time should be agreed on at once, as they would lose the time which they might gain in appointing Deputies to do the work which had to be done. Could the Council meet immediately after the session of the General Assembly of the United Nations?

M. Molotov said that it was not yet certain when that session would end.

Mr. Byrnes said that he was naming no date, but that they could have an understanding that they would meet shortly after the session of the General Assembly.

M. Molotov had no objection in principle.

Mr. Bevin said that he had no objection. He wished that somebody had thought of it two hours ago.

M. Bidault stated that he had no objection. He added that the new French draft on coal was being circulated in English and Russian text.²³

M. Molotov asked for observations on the records of the 30th, 31st, 22nd and 33rd meetings.

The Council approved the records of those meetings.

Mr. Byrnes asked what action was going to be taken on Mr. Bevin’s proposal (CFM(46)224).²⁴

Mr. Bevin said that this was a very important matter for British Government. He based his position on Article 15 of the Potsdam Agreement which was different and separate from the clauses on reparation. He asked his colleagues to agree to this proposal which was of fundamental importance in working out a solution to the German question. In his view it would also assist the payment of reparation. Could his colleagues agree to these three paragraphs?

M. Molotov stated that he had already set forth the view of the Soviet Delegation on those proposals. Those proposals violated the decisions of the Berlin Conference and as adopted would be likely to hamper the execution of the Berlin agreement on reparation. The Soviet Delegation could not agree to any such proposals.

Mr. Bevin said that if there was no agreement, he must make it clear that his government was obliged to organize the British Zone. They realized their obligations in connection with coal and other things but they were bound to produce for export in order to reduce the burden on the British taxpayer. He was convinced that the adoption of his proposals would facilitate the execution of the reparation program, but if it could not be adopted, the British Government was unwilling to go on borrowing dollars to import food into Germany. The British Zone would have to produce for export because of Great Britain’s dollar and exchange position. Many of the mines and works in the British Zone were damaged, and even with the present low level of production, Britain was forced to satisfy the needs of importing countries; this required using more German production in Germany in order to get production up to the point where the zone did not represent a liability on the British taxpayer. The British authorities would, of course, keep within the limits of the level of what is laid down by the Council. There was a great margin between what was now being produced and what was allowed under those limits. If that margin could be filled up, then there would be no burden on Great Britain. He felt sure that if Article 15 were applied, the present system could go on and the receiving countries could continue to receive coal as production in the British Zone was being built up to a point where it would no longer be a burden.

Mr. Byrnes then made the following statement:

“I hope that we can avoid the situation outlined by Mr. Bevin. I still hope that my colleagues at this meeting will agree to the establishment of the Central German Administrative Agencies necessary to secure economic unity in Germany.

“The United States will agree that the Saar region be excluded from the authority of those central agencies so that it can be administered as at present by the French Government until the western boundaries are finally determined.

“If the Council cannot agree upon Central Administrative Agencies, then the United States as a last resort makes another suggestion.

“At present no zone of Germany can be regarded as fully self-sustaining. The treatment of any two zones as an economic unit would improve conditions in both zones.

“Recently officials of the United States zone have met with officials of the United Kingdom zone to discuss agricultural policies. Meetings have been held between German economic officials from the Soviet and United States zones, during which agreement was reached with the approval of the military governments, for the exchange of some products.

“Pending agreement among the Four Powers to implement the Potsdam Agreement requiring the administration of Germany as an economic unit, the United States will join with any other occupying government or governments in Germany for the treatment of our respective zones as an economic unit.

“We are prepared to instruct our military representatives in Germany to proceed immediately with the representatives of any other occupying government to establish German administrative machinery for the administration of our zones as an economic unit.

“It is the view of the United States Delegation that such arrangement could be accomplished without interference with the existing quadripartite government of Germany. The proposed arrangement should at all times be open on equal terms for the participation of any government which did not elect to participate in the beginning. This proposal is not intended to divide Germany, but, on the contrary, to expedite its treatment as an economic unit.

“We cannot continue to administer Germany in four air tight compartments, preventing, as I stated a few days ago the exchange between the four zones of goods, communications and even ideas. The continuation of the present situation will result in inflation, and economic paralysis. It will result in increased costs to the occupying powers and unnecessary suffering to the German people.

“The United States is unwilling to share the responsibility for the continuance of such conditions. We feel it our duty to exhaust every effort to secure the cooperation of the occupying powers in administering Germany as an economic unit.”

The meeting adjourned at 8:20 p.m.

13. For a list of persons present at this meeting, see the Record of Decisions, infra.
14. See Section V, Reparations, of the Protocol of the Proceedings of the Crimea Conference, Foreign Relations, The Conferences at Malta and Yalta, 1945, p. 978.
15. The letter quoted below, from Pauley to Maisky, is printed in full in Foreign Relations, The Conference of Berlin (The Potsdam Conference), 1945, vol. i, p. 522. For additional documentation on the discussions during 1945 regarding German reparations and the work of the Allied Commission on Reparations, see Foreign Relations, 1945, vol. iii, pp. 1169 ff.
16. The British proposals were set forth in C.F.M.(46) 224, July 11, 1946, p. 900.
17. C.F.M.(46) 222, July 10, 1946, p. 878.
18. The British proposals were subsequently circulated to the Council as C.F.M. (46) 225, July 11, 1946, p. 901.
19. For additional documentation regarding German reparation question in 1946, see vol. v, pp. 480 ff., passim.
20. For the paragraph under reference, see Foreign Relations, The Conference of Berlin (The Potsdam Conference), 1945, vol. ii, p. 1506.
21. For the French proposal, see C.F.M.(46) 216, July 10, 1946, p. 878.
22. Regarding the discussions in the Allied Control Council for Germany on the question of the disarmament of German armed forces in the British zone of occupation, see telegrams 1066, November 21, 1945, and 1154, December 1, 1945, both from Berlin, Foreign Relations, 1945, vol. iii, pp. 852 and 854, respectively.
23. See C.F.M.(46) 226, July 11, 1946, p. 901.
24. Post, p. 900.