Foreign Relations of the United States, 1948, Germany and Austria, Volume II

EUR Files: Lot 55 D 374: Saar–1948: Telegram

The Department of the Army to the United States Military Governor for Germany (Clay)¹

secret

[Washington,] 17 January 1948.

Warx 94204. From CSCAD cite PL. Reourads Jan WX 98246.² Personal for Clay.

Negotiations with French re Saar is subj.

Subj negotiations pursuant to Bidault-Marshall conversations in London³ and ur understanding with Secy State. Believe US views in such negotiations should be set forth as fols:

1. US now ready to recognize de facto separation of Saar from Germany and incorporation its economy with that of France subj to agreement on related issues involved and to confirmation of this arrangement in final peace settlement.

2. Accordingly US prepared to have Berlin-agreed formula⁴ for gradual withdrawal of Saar coal from German coal pool applied forthwith.

3. US Govt prepared to join UK and French Govts in notifying ECE of above formula, but under condition, stated by Secy State to Bidault in London that France will have to make her own case for coal allocations before ECE.

4. Trade between bizone and Saar should, unless you perceive urgent objections, now be included under offset pmt agreement between bizone and France but without prejudice to any later decision re French contribution to support eventual trizonal economic unit. Understand from French here such trade approx balanced at present.

5. Altho attempt should be made to restore prewar boundaries of Saar, US prepared for sake of agreement to accept present boundaries for adm purposes subj to final settlement in peace treaty.

6. France should agree to announce voluntarily in IARA that it will debit its reparation share with value of plant and equip which would have been declared avail as reparation if Saar had remained part of Germany. Value should be subj of tripartite agreement and estimated on basis of Saar industrial plant [apparent omission] of that of three western zones as whole. Rate at which French reparation share shall be debited should be left to decision by IARA. Since on basis of this formula IARA, thru France as IARA member, would receive as reparation all of equip which would have been avail to all reparation claimants from Saar, Potsdam request for 75 to 25 div between IARA and USSR/Poland of reparation plant avail from three western zones would not be met without some upward adjustment of USSR/Polish share of subsequent reparation availabilities. Such adjustment will not need to be made unless agreement ultimately reached to resume reparation deliveries to USSR/Poland. Entire formula outlined above is modification of one agreed by three powers at CFM Moscow session which was transmitted to Berlin as Mos Emb 328 and amended by ourad 98246 and which no longer seems applicable in view of subsequent conclusion bizonal level of industry and untenability of reqmt of Control Council approval.

7. Other questions such as those relating to nationality of Saar residents, disposition of German state property in Saar might be left to later negotiations.

8. Suggest you emphasize to French that in view of our willingness to accommodate them on Saar we would expect them to be cooperative in connection with new arrangements for economic orgn in western Germany. State Dept will probably make same point in reply to French protest.

Pls inform Murphy of above.

1. Numbered paragraphs 1 through 7 of this telegram were transmitted to Murphy earlier in telegram 34, January 9, to Berlin, with the explanation that the message was for Murphy’s personal information and the Department was attempting to obtain Department of the, Army concurrence in having it transmitted to Clay as a formal instruction (740.00119 Control (Germany)/1–948).

   This instruction was discussed by Department of State and Department of the Army representatives on January 12 (see memorandum of conversation by Oppenheimer, January 12, 1948: WE Files: Lot 53 D 246: File “Saar”), and it was referred to Secretary Marshall on January 13 for approval under cover of the following memorandum by Frank Wisner to Under Secretary Lovett:

   “Referring further to our conversation of Saturday morning [January 10], I attach a draft of proposed cable to General Clay, the text of which has now been cleared with the Army. I understand that you consider it advisable for the Secretary to pass on this message, since it represents a crystallization of US position with regard to the Saar.

   “Actually, on several occasions; and as recently as the closing days of the CFM in London, indications have been given to the French of the willingness of the US to agree to the incorporation of the economy of the Saar with that of France, subject to a confirmation of this arrangement in the final peace settlement. The Army raised the question whether we contemplated obtaining any specific quid pro quo from the French in this connection. We have advised the Army, without any stated objection from them, that we do not intend to ask for a specific quid pro quo in consideration of the de facto recognition of the economic integration of the Saar into France, because of our previous expressions of intention and because of our desire to appear helpful to the French in regard to this, matter. However, you will note that the proposed cable contains in paragraph 8 a suggestion that General Clay emphasize to the French that, in view of our willingness to accommodate them on the Saar, we would wish them to be cooperative in connection with new arrangements for the economic organization in Western Germany. We also indicated to the Army that we would consider making a similar point in our reply to the French note protesting the Frankfurt developments.” (740.00119 Control (Germany)/1–1348)

2. Not printed.
3. See Ambassador Douglas’ memorandum of the conversation between the Secretary of State and Foreign Minister Bidault at London on December 17, 1947, Foreign Relations, 1947, vol. ii, p. 813.
4. Regarding the formula under reference, see telegram 3244, October 1, 1947, from Berlin, ibid., p. 1098.