740.00119 Council/3–3147: Telegram

The Secretary of State to the Acting Secretary of State

secret
urgent

1118. Delsec 1375. To Acheson Personal Eyes Only for the President from Marshall. Please deliver immediately the following to the President:

Dear Mr. President:

We are now locked in the final discussions regarding economic and political unity and regarding political organization of Germany. The vital points are the level of industry, with related demands for reparations from current production (having in mind that to raise the level certain plants now allocated to Russia must be retained in Germany; otherwise no increase in the level of industry is possible); coal for France which also directly affects the problem of raising the level; and the demands for reparation from current production. Later, on the agenda are: the Four-Power Pact; the Ruhr problem; and the location of boundaries which, on the Eastern Front, have an important bearing on the density of population and the supply of food from a rich agricultural district. These matters are related to the problem of unity but cannot yet be discussed in detail.

I will now quote instructions which I am about to give the American Delegation unless I hear from you to the contrary. I have not gone into detail; that must depend on developments and the immediate view of the best tactics to be employed. “The viewpoints expressed below give the United States’ position on certain subjects now being considered by the Council of Foreign Ministers. These viewpoints are for your information and guidance in preparing papers or in discussions you may have with members of the other delegations in connection with the problems involved in the current Inter-Allied Administration of Germany.

Over-all considerations: The principal desires of the United States as regards the current Inter-Allied Administration of Germany are to obtain (A) a politically and economically unified Germany under a democratic government with effective safeguards of human rights and I fundamental freedoms; (B) a sufficient increase in Germany’s level of industry to assist in the economic recovery of Europe; (C) guarantee of security from German aggression by a treaty among the four occupying powers; (D) an adjustment in connection with the provisional eastern boundaries to provide additional food for Germany and to reduce her present population density.

Level of industry and reparations: acceptance of the four-power treaty principle will insure our security to the extent that an increase in the German level of industry for peace-time purposes can be permitted. [Page 299] Such increase would reduce deliveries of capital equipment as reparations but might permit use of current production as reparations as compensation for withdrawal of plants now allocated for reparations, taking into account that Germany should share with the Allies any resultant increase in its standard of living above the European average. The extent to which reparations could be paid for this purpose without increasing the burden on the occupying powers would depend upon Germany’s ability to develop an export surplus. In any event such a reparations plan should not become effective until economic unity and political unity are established in fact. Any reduction in cost of supporting German food ration through increased availability of surplus agricultural area under Polish administration would facilitate the development of an export surplus and the payment of the above-mentioned and limited reparations from current production. The United States would not agree here to a definite plan involving reparations from current production but only to studies of the relevant factors.”

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Marshall
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