Foreign Relations of the United States, 1947, Council of Foreign Ministers; Germany and Austria, Volume II

740.00119 Council/12–847: Telegram

The United States Delegation at the Council of Foreign Ministers to President Truman, the Acting Secretary of State, and Others

confidential

London , December 8, 1947—7 p.m.

6381. Delsec 1531. For the President, Vandenberg, Connally, Eaton, Bloom and Lovett. Twelfth CFM meeting, December 8, Bidault presiding, Lord Pakenham replacing Bevin who is ill.

Upon Marshall’s suggestion, the Council adjourned for 30 minutes to permit study of a new Soviet proposal on economic principles for Germany.²⁵ Main points of the Soviet proposal are: (1) Reparations for the USSR will be fixed at 10 billion dollars, the Soviet Union to satisfy the reparation claims of Poland from its share and all reparations obligations are to be fulfilled by 1965; (2) the agreement on the economic unification of the US and UK Zones shall be deemed null and void as contravening the economic unity of Germany; (3) interzonal barriers shall be abolished and necessary facilities provided for the free flow of goods throughout Germany only after central German administrative agencies have been set up and procedure for the fulfilment by Germany of her reparation and other main obligations has been decided.

In a prepared statement,²⁶ Molotov attacked the European recovery program which he said was fraught with great dangers for the German people and the other nations of Europe. He charged that the US planned to set up a separate government for western Germany. He concluded by asking that the Soviet and UK proposals be accepted as the basis of the Council’s discussion of economic principles for Germany.

When the Council reconvened, Marshall again asked Molotov whether the Soviet Union would oppose economic unity in Germany until the Council agreed that Germany should pay 10 billion dollars in reparations to the USSR. Molotov said agreement on reparations was not prerequisite to the economic unification of Germany but that both questions should be considered at the same time. Pakenham said the UK had never accepted the Soviet demand for 10 billion dollars in reparations from Germany and could not now consider such a demand. He pointed out that Molotov had acceded to the other ministers’ requests and presented a comprehensive proposal on economic principles but had accompanied his new proposal with a shocking attack on the Western Powers which was not conducive to an atmosphere in which agreement could be reached. He added that the Soviet proposal contained numerous suggestions, such as those on reparations, which had been categorically rejected by Bevin numerous times.

The deadlock over procedure was ended when Molotov agreed to discuss the questions falling under the general problem of economic principles for Germany in the order in which they are listed in the British proposal.²⁷ Soviet suggestions which are not included in the UK list will be taken up at the end of the paragraph-by-paragraph discussion of the British document.

The Council opened its substantive discussion by considering the first paragraph of the UK document²⁸ which lists the general economic aims of the four controlling powers as regards Germany. The exchange of views revealed sufficient agreement to refer the paragraph to a drafting committee for completion.

The discussion was begun and will be continued tomorrow on the second paragraph of the UK draft dealing with the sharing between the controlling powers of the financial burden already incurred and which may be incurred by them in the future.²⁹

Repeated to Moscow, Paris, Berlin, Vienna, Rome.

25. Document CFM(47) (L)22, December 8, 1947, p. 790.
26. For the text of Molotov’s statement, circulated to the Council as document CFM(47) (L)23, December 8, see Molotov, Problems of Foreign Policy, pp. 525–530.
27. Document CFM(47) (L)7, November 27, 1947, p. 779.
28. The reference is to paragraph 16 of CFM(47) (L)7.
29. For the exchange of messages between the Secretary and the Acting Secretary on the question of the sharing of deficits by the occupying powers, see telegrams Martel 52, December 9, from London and Telmar 58, December 9, to London, immediately following.