501.BC Greece/2–2047: Telegram

The Ambassador in Greece (MacVeagh) to the Secretary of State

top secret

243. Deptel 188, February 18. Porter, Ethridge, and I desire emphasize that we have been in constant consultation over general situation, and that opinions expressed this subject in my telegrams 187, February 9;1 196, February 11; and 227, February 17, represent views of all three. In addition, following concerted during meeting last night:

We feel situation here so critical that no time should be lost in applying any remedial measures, even if only of a temporary character, within possibilities of US and UK. Impossible to say how soon collapse may be anticipated, but we believe that to regard it as anything but imminent would be highly unsafe.
If nothing but economic and financial factors were to be considered, full collapse from Greece’s present position might take several months. However, deteriorating morale both of civil servants and armed forces, as well as of general public, owing to inadequate incomes, fear of growing banditry, lack of confidence in Govt, and exploitation by international Communists, creates possibility of much more rapid denouement.
We believe best way combat explosive situation would be to help recreate confidence in state and in future of Greece as democracy of Western type by removing, at least in present acute stage, growing fear of inflation, and consequently of increased misery, and by making plain to everyone, including Soviet Union, our determination not to permit foreign encroachment, either from without or within, on independence and integrity of Greece.
We feel that immediate temporary solution to gold problem should be effected, and that this should be followed closely by such heartening attention to Greece’s situation as our suggested visit by Secretary would supply. Coordinated practical and spectacular measures of this sort we believe would help to avert at least the imminent [Page 29] danger of explosion, and would “buy time” for eventual application of remedies of a longer term character, such as constitute chief concern of UN and Porter Missions.
Regarding Porter report, we agree this should be completed soonest. Mission is anxious to complete its assignment, and is receiving every help from Embassy. However, economic policies which Mission will suggest cannot immediately be effectuated, and mere filing of recommendations will not avert immediate prospect of ruinous inflation with all its attendant dangers. In addition to preparing report, Mission is seeking by daily negotiations with Government to lay foundation for 1947 program which has some prospect of success, but meanwhile, time element is so critical that temporary measures must be considered if effectiveness of both Porter and UN Missions is to be saved from extreme jeopardy.
Position regarding UNRRA supplies will be subject of subsequent telegram.

  1. Not printed.