The United States Military Governor for Germany (Clay) to the War Department 17
72088. State Department has requested18 my comment relative to:
- (A)
- Resumption of reparations
- (B)
- Publication of lists of plants available for reparations under new level of industry plan
- (C)
- Agreeing to consider establishment of international allocating board for Ruhr coal, and
- (D)
- Compromise with the British in establishing a trusteeship of Ruhr coal mines which would permit early vote of German people as to eventual ownership without affecting the US–UK management agreement.
Comment follows herewith: In the interest of German administration and recovery, it would be most desirable to proceed forthwith and complete at earliest possible date dismantling and delivery of all plants to be made available in reparations. However, it is still my strong view that no plant should be given to the USSR until agreement has been reached with respect to the economic unification of Germany. Therefore, I would recommend that reparations deliveries be withheld at least until after the November conference of the Council of Foreign Ministers. In point of fact, this should involve no delay as the agreed plants in US and UK Zones in excess of the new level of industry could be reported to Allied Control Council for allocation with understanding that deliveries would continue to be subject to agreement on economic unification. The time required for allocation of these plants could very easily be extended in quadripartite discussions to avoid decision being made until after November meeting of Council of Foreign Ministers.
This would permit the early publication of plants to be retained in Germany in US and UK Zones under the new level of industry plan. The publication of this list is essential to provide German people with hope, thus encouraging democratic leadership and also to encourage manufacturers to place their plants in order to permit early resumption of production. The publication of this list of retained plants is so important to recovery that it forms a basic reason for the early publication of the new level of industry.
I see no objection in principle to the establishment of an international body for the allocation of coal from the Ruhr and certainly no objection to agreeing to consider the establishment of such a body at an early conference, although whether or not this should be done as a tripartite measure prior to the Council of Foreign Ministers meeting in November is something which deserves serious consideration. However, this decision would be relatively unimportant in so far as Germany is concerned. I do have a strong feeling that the functions of the allocating body should be clearly defined to interfere to the minimum with such sovereign points as are restored to Germany in the peace treaty as otherwise the political effects in Germany would be damaging and cumulative. In general my view is that such a body would be entitled to receive full and complete reports as to the production of coal in Germany and the use to which the coal held in [Page 1061] Germany is placed with powers to intervene to require a greater export of coal if it appears to the advantage of Europe as a whole to require an increased export of German coal. Of course, this measure itself might well be weighed against specifying a fixed percentage of coal production for export purposes in the final peace treaty with Germany. Nevertheless, the former arrangement gives greater flexibility and would be particularly advantageous if the degree of economic cooperation in Europe visualized in the objectives of the Marshall Plan does result. It must be remembered that any agreement to form such an international allocating board made prior to the unification of Germany might well lead to the inclusion of the Soviet Government on the allocating board where it would be able to interfere seriously with the cooperative effort visualized in the Marshall Plan. For this reason consideration of the formation of such a board might well be agreed now but with any formal conference deferred until after the November meeting of the Council of Foreign Ministers when it may be possible to more accurately visualize Germany’s immediate future.
I assume that we could agree to no international allocating board during the period of tri-partite control.
I do not believe that we should compromise with British representatives in agreeing to the German people having the right to vote on the permanent future status of the Ruhr coal mines in the near future. I understand that one of the reasons why we desire to compromise results from our own acceptance of socialization as a constitutional right in the constitutions of the several states in the US Zone. I do not quite follow this reasoning. Certainly the United States has always insisted on the constitutional right of any people to determine their political and economic structure under democratic procedures and in approving the state constitutions the approval of the provision was merely a recognition of our long-established support of the right of a people to determine their own future. However, in approving the state constitutions it was clearly stated that matters concerning Germany as a whole were reserved to Military Government. Obviously we would not interfere with state, counties, or cities taking over the public ownership of public utilities serving these political entities only as clearly the question of ownership is one that pertains to the people living within the political entity served. However, it is equally obvious that the fate of the German people as a whole is inextricably connected with the great coal and steel industries of the Ruhr which are the principal resources for all Germany. Without the Ruhr and its products the German people cannot hope to have a balanced import-export program. Hence it is impossible to determine the future of the great [Page 1062] industries as an expression of the will of the German people until it is known what the boundaries of Germany will be and who the German people will be who must depend upon the Ruhr. It is unthinkable to agree to North Rhine Westphalia as one of several German states being permitted to take over all of the assets of the Ruhr unless desired by the German people as this one state would then become the dominant factor in the German political structure.
It is believed that the British have promised the Social Democratic Party just this but this was a unilateral promise. It is further desired to point out that under our joint US-UK controls each Military Government exercises its own independent control of state governments and that with the Ruhr industries placed under this single land its future will be in the hands of a government which reports only to British Military Government. As a compromise, if the 5-year term is too obnoxious to the British to permit agreement, it is suggested that we express our willingness to permit the German people to vote on the socialization of Ruhr industries when it becomes possible for them to vote as a people and when the United States and United Kingdom have agreed that political and economic conditions are sufficiently stable to permit a free expression from the German people. In point of fact, at present the CDU Party holds a slight majority in the bizonal economy council. It is almost certain that this council would not agree to North Rhine Westphalia taking over ownership of the Ruhr industries and it is even doubtful if this council would agree at this time to socialization of these industries. It is a great mistake to assume that extreme Socialists represent present majority viewpoint now in Germany. It is true that they are better organized and are more aggressive, the great bulk of the CDU Party comes from what is normally the middle class of Germany and at most is in favor of only a mild socialization program. In spite of these factors, an election at the present time or in the immediate future would be a great mistake as it would develop bitter political controversy which would be exploited in every possible way by the Communist Party and would certainly interfere seriously with the rate of economic recovery.
New subject. In as far as the designation of the individual to take over the mines is concerned it seems to be of no importance as to whether he is called trustee, administrator, or any other name that conveys the general meaning and purpose of his job. New subject. I am convinced it would be serious mistake to recommend US chairmanship or majority membership in coal Control Group at this time. Organization of Control Group must follow bipartite pattern for management of economy as a whole: Otherwise, damaging friction is certain to develop between bipartite board which requires joint agreement [Page 1063] and Control Group with majority American control. This question may be raised again if we take on greater financial responsibility. However, it should even then follow pattern established for overall bipartite control.
Request that these views as may be modified by War Department be conveyed to State Department as matter of urgency. Copy has been given to Ambassador Douglas.
- This message, which was transmitted through the United States Military Attaché in London, was addressed to Secretary Royall, General Noce and General Draper. The source text is included in the files of the Office of European Affairs, Division of Western European Affairs, Lot 53 D 246, file “Germany–General”.↩
- Telegrams 3638, August 22; 3653, August 23; and 3661, August 24, to London, pp. 950, 1055, and 952, respectively.↩