CFM Files: Lot M–88: Box 95: Saar

Draft Memorandum of Conversation41

Present: Mr. Cohen, Mr. Dulles, Mr. Matthews, Dr. Mason, Mr. Murphy, General Draper, Mr. Riddleberger, Mr. Kindleberger, Colonel Bonesteel, Mr. Jacobs.

Mr. Mason explained that he had requested the meeting in order to discuss the position of the U.S. Delegation on the action to be taken [Page 477]with respect to the transfer of the Saar in the likely event that there is no quadripartite agreement on the problem.

Mr. Kindleberger said that a tripartite decision to detach the Saar and make it part of a Financial and Customs Union with France would lay the U.S. and Britain open to obstruction and bitter criticism by the Russians and such countries as Yugoslavia and Czechoslovakia, in ECO, with respect to coal allocations, in IARA, with respect to charging the reparations account of France, and possibly in ECITO where the Russians were also members. He said that any of these countries could ask for an official communication on the transfer of the Saar to France from either the CFM or the Allied Control Council and refuse to recognize the transfer and its implications for their particular problems without such official notice.

Mr. Cohen said that he thought the problem must be divided into several parts. He felt that we should try to accomplish as much of our objectives, that is the satisfaction of French desires with respect to the Saar, as possible without risking dangerous opposition. He felt that it should be possible to treat the Saar in somewhat the same way that the Polish-administered areas of Germany were being treated. He recalled that when Mr. Byrnes invited the other zones to join with the US zone in the widest possible German economic unity in Paris last July, he stated that he would welcome the adherence of the French zone less the Saar. If the French Zone were merged with the US–UK bizonal area, therefore, some arrangements would have to be made to leave the Saar out of the trizonal union and to permit the French to administer that separately. Any action the French should decide to take subsequently with respect to regarding the resources of the Saar as part of the French economy would rest with them. The United States would have to take a position on this action, if at all, only when it occurred. For the most part it might be possible not to take an open position but to support the French in silence or abstentions. If a public statement was eventually required it could say that the arrangements made were provisional.

Mr. Dulles said that he thought we should not let fear of the Russians’ criticism stop our doing anything that we had agreed to do. If we did allow ourselves to be deterred by fear of Russian criticism, we would be able to do nothing.

Mr. Kindleberger said that the occasions on which the Russians or their satellites could make damaging criticism of the U.S.-British position, would be numerous and that there was real danger that a number of international objectives, such as those of the U.S. in ECO and IARA would suffer seriously. Mr. Cohen and Mr. Dulles thought [Page 478]that these problems could be met by stating the U.S. position when the need arose.

The discussion then shifted to the exact nature of our commitments to the French. Mr. Mason pointed out that his discussions with Sir Edmund Hall-Patch had given him the impression that the British did not understand that the cession of the Saar to France deprived Germany of Saar coal and its export proceeds. It was recalled that the Secretary had agreed to the immediate detachment of the Saar and its incorporation in the French financial and customs union. This, it was stated, meant that Saar coal would have to be paid for in francs.

Mr. Mason and General Draper pointed out that the cost was probably of the order of 50 million dollars a year since the Saar was exporting about 345,000 tons of coal to the French and U.S. Zones and 100,000 tons of coal a month to France. Since coal sent to the U.S. and French zones would have to be replaced by Ruhr coal diverted from exports which brought $10 a ton and the dollar proceeds of the exports of 100,000 tens a month would accrue to France rather than to the French occupying authorities in Germany, the net loss would be about 50 million dollars a year. It was agreed that there were not any balancing items of trade which substantially reduce this figure.

Mr. Dulles said that he felt that Mr. Bevin’s frequent statements to the effect that he was not authorized by his Government to incur any further obligations on the British taxpayer made it clear that Mr. Bevin would not have agreed to the cession of the Saar if he had understood any cost to the British was involved.

Mr. Cohen said that the U.S. could not agree to cession of the Saar removing this coal from part of Germany’s resources at least until there was a balance of German exports and imports. General Draper agreed.

Mr. Dulles said that he felt that one of the principal favorable results of the present Conference was the manner in which we had managed to bring the French closer to ourselves and the British and that we should do whatever we could so long as it did not increase our costs in Germany to help the French to stay close to us in their position. It was agreed that Mr. Mason would inquire of Sir Edmund Hall-Patch as to the British views on this problem.

  1. This draft memorandum was probably prepared by George R. Jacobs.