840.6362/3–2847: Telegram
The Ambassador in the United Kingdom (Douglas) to the Secretary of State
us urgent
1940. Personal for Acheson. During the last week have taken opportunity to review British coal situation. I fully agree with views of Secretary Marshall, as stated in his 1354 of March 27,1 that any increase in American coal exports to Europe should be channelled through ECO and that allocations of coal by ECO to UK, unless wholeheartedly supported by ECO importing countries, might have unfortunate consequences on the continent and should not be made.
In the event Mr. Bevin initiates discussions on coal with Secretary Marshall, I am submitting the following estimate of the way in which the Government here is attempting to solve its coal difficulties. On further review this estimate may be altered but at the moment it is my best judgment.
Few steps have so far been taken toward an orderly shutting down of marginal mines. Nor has the wage structure been altered so as to relate miners’ compensation to productivity. Only lackadaisical efforts appear to have been made towards providing even temporary housing facilities in the more productive coal fields. No action has been undertaken to increase consumer goods in the more productive areas for the miners and their families. The system of taxation is such that any increased earnings of the miners resulting from increased individual production leaves but a small residue in the hands of the miners. These [Page 498] steps seem necessary to reduce the present high rate of absenteeism; to induce miners to move from least productive mines, when they are shut down, to the more efficient mines and fields; as incentive to increased individual productivity, and to hasten recruitment of additional men to the mines, which is now proceeding at moderate rate.
There is great resistance to the use of oil in several large electrical generating power stations, which with minor changes are adapted to the burning of oil. This step alone might conserve as much as 3 to 5 million tons of coal annually. The traditional practice of requiring lump coal of substantial size among many large consumers instead of burning the run of the mine product, as is the custom in US is deeply rooted; and no efforts have been made to change it. This has a depressing influence on production.
Mechanical equipment that is available for both open cast and underground mining operating is not being installed as rapidly as might be. The five day week has been adopted. In view of the high rate in absenteeism, this may not have as adverse an effect on coal production during the next six months as might be expected. I recognize that there are many social and political crosscurrents which may account for what appears to be an inadequately vigorous approach to the UK coal issue but I pass on what seem to be the facts for the Secretary’s information.
Sent Department as 1940; repeated Delsec Moscow as 142.
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