840.50 Recovery/7–1747: Telegram

The Secretary of State to the Embassy in the United Kingdom

secret
urgent

3066. For the Ambassador. British Embassy has just presented aide-mémoire60 stating that Bevin most disappointed that US does not feel prepared to enlarge scope of discussion on coal production in Western Germany to other related matters; that Bevin feels bound to accept US decision that agenda not be enlarged at present; and that consequently he does not think he would be justified in sending party to Washington merely to discuss coal. Although sharing US view of urgency of coal problem, Bevin does not consider decision on coal alone, isolated from other related matters, would have serious effect on coal production for next few months. Decisions on coal alone could, in Bevin’s view, just as well be reached in Berlin by Mil Governors, supported if necessary by experts from Washington and London. Aide-mémoire continues that Bevin greatly regrets Brit will not have opportunity of explaining to US the impossibility for Brit to continue to support dollar drain imposed by arrangements for financing Germany’s imports. Hopes that assistance may emerge as part of plan for European recovery, but wishes to place on record fact that, whatever the issue of present European reconstruction discussion, Brit will not be able to continue to bear serious burden.

Brit were advised of our view that to broaden scope of discussions beyond Bizonal coal production inadvisable at this stage, particularly in light of Paris Conference. It was acknowledged that discussion of other German matters suggested by Brit would have to take place some time in future. With respect to coal talks, we informed Brit that our reason for suggesting their being held in Washington was largely [Page 945]because of importance of placing them on governmental level, which we believed necessary if immediate increase of production is to be achieved.

Brit were also informed that you were taking up with Bevin the matter of the coal talks.

You should emphasize to Bevin the importance we attach to these talks and the fact that he had accepted the invitation to hold them in Wash (Embtel 3745 July 861) and had publicly so announced. The press is already considerably confused by reports from London this afternoon and is reading into reversal of British position serious differences between us.

With respect to Brit dollar drain, we emphasized that we were familiar with the situation and were following it closely.

Marshall
  1. Dated July 17, 1947, not printed (862.6362/7–1747).
  2. Not printed.