CFM Files: Lot M–88: Box 63: Correspondence

The United States Representative on the Austrian Treaty Commission (Dodge) to the Assistant Secretary of State for Occupied Areas (Hilldring)

secret

Dear John : This is word from one engaged in supposedly quadripartite negotiation which has actually been unilateral determination, so far.

I prepared the attached statement7 which I have not yet used, which explains the situation. At an appropriate time I may use it. Probably soon.

Monday8 was Whitsuntide and a holiday, so no meeting. Tuesday I was chairman and had a tough time to carry the meeting.9 The Soviets opened with oil and closed with oil. I finally got them on to [Page 586] Article 42 and made our statement regarding it, thus fulfilling my commitment on these two articles. At that we adjourned in two hours with the only agreed agenda as comments on our paper, everyone refusing oil.

Today10 with Novikov in the chair we decided to let him sweat. With the others’ comments on 42 finished, he proposed making a statement on the Bitumen Law, thus dragging in oil by the back door, and I chopped that down quick. Then I proposed returning to instructions to the Committee of Experts and he countered with oil. There were long silences. Adjourned at 11:20 a. m. with no agreed agenda. Nice business.

I think our record is good, except for accomplishment. We have made a series of proposals on instructions to the Committee, beginning the first day very generally and becoming more specific as the discussions proceeded. I even adopted the Soviet “typical concrete facts” on oil in more general terms and with a few additions for all German assets in our 4th proposal, supported by the UK and French. Later put in a list of facts (categories) illustrating our different views of Article 35. We got nowhere. He says oil, we say no.

Fortunately we are in a strong position—3 to 1—and I remind my colleagues how much better that is than if it was one of us alone against the other three.

I have gone on record that we were willing to prepare and submit a list of properties in the US Zone of Austria considered German. Also that we propose to live up to our commitments in Potsdam regarding German assets,11 and follow the facts, when accurately and justly determined. We have the people here working on the lists and data.

The Soviets want an agreement on oil—period—and a bilateral agreement with Austria on everything else. All reports indicate that—intelligence and otherwise. Some of the Austrians think that is good. When I consider our experience here and elsewhere in quadripartite negotiation I think the Austrians are extremely naive and unrealistic.

If we let the Soviets get oil (exclusively) on the agenda of the Commission or the Committee, I am sure we will never get anything else on short of an agreement on oil. The Soviets may concede quite a bit to get an agreement on oil, to reinforce their legal rights. We will end up with an agreement on oil and a disagreement on everything else—including perhaps a discussion of nothing else—which will not be much assistance to the CFM.

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If we take oil to the Commission we practically scrap the Committee. If oil has first priority in either the Soviets can block discussion or agreement on anything else until oil is agreed on. It is the one thing they want most and at least in my view is the can opener to the rest. Before I let anyone consider oil I want to see them buy some of my goods.

This is not a procedural matter. It is the guts of the problem and the French and UK have the same belief. We won’t even let them make a statement about oil or their position on it (and listen) because they will use it for propaganda purposes, we may not dare let it stand without an answer, and if we do answer we are in, up to our necks, with no way to get out without their consent.

Therefore, our position is oil, yes—but not first or only. Not before anything else and not the DDSG or other cases after oil. We must have agreement to discuss other important aspects—concurrently or simultaneously.

I will probably propose, if this stalemate goes on, to set this aside and proceed with other disagreed articles of the Treaty. If they still say no—oil first—they will have hung the Commission, the Committee and the rest of the Treaty solely on their demand for a settlement on oil before anything and everything else.

We may not have convinced them of much, but I am sure they are convinced we are far from easy or soft.

We have made many concessions, including discussion of 35 and 42 to no profit. We are not standing on our dignity or being stubborn. We are convinced if we give way to their demands on oil we are lost before we begin. We will work by it, I am sure, but it may take a little time.

Meanwhile we are getting all the information we can on German and UN nationals’ assets from all available sources. That we can do, and we will try to come out with tripartite agreement on all or most of it.

Everyone here has been most cordial and cooperative. We like Keyes, Erhardt and the others very much. The men working with me are towers of strength and I am always sure of going into or through a meeting looking much smarter than I actually am.

Very Sincerely,

[
Joseph M. Dodge
]
  1. Not found attached to source text.
  2. May 26, 1947.
  3. Ninth Meeting of the Austrian Treaty Commission, May 27.
  4. Tenth Meeting of the Commission, May 28.
  5. Reference is to the renunciation by the United States and the United Kingdom to claims in respect of German foreign assets in Eastern Austria, Section IV, paragraph 9 of the Report on the Tripartite Conference of Berlin, August 2, 1945, Foreign Relations, The Conference at Berlin (The Potsdam Conference), 1945, vol. ii, p. 1506.