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

740.00119 Control (Germany)/1–1148

The Secretary of State to the French Ambassador (Bonnet)¹

The Secretary of State presents his compliments to His Excellency the French Ambassador and has the honor to reply to His Excellency’s note and aide-mémoire presenting the views of the French Government regarding the plans for the reorganization of the bizonal economic administration in Germany.²

The views of the French Government have been carefully considered by the United States Government and the United States military authorities in Germany. They will be given continued consideration in the evolution of the bizonal administration. The French Government may be assured that this administration is provisional in fact and is not designed to be a pattern for future government in Germany. The actions of this administration are subject to the approval of the occupying authorities. Accordingly, if the actions of the bizonal administration prove the apprehensions of the French Government to be well founded, the occupying powers remain in a position to take prompt remedial action. The basis upon which approval has been given to the bizonal reorganization is that experience has shown that the degree of responsibility now to be accorded to the German administration is an essential minimum to enable it to deal with the many obstacles to be overcome if the bizonal area is to contribute its share to European recovery.

In its aide-mémoire the French Government raised certain specific questions respecting the bizonal reorganization. The following is submitted by way of clarification and reply:

(a) Although the Economic Council and the Council of States do not have equal powers, the latter does have power to initiate, to amend and to veto legislation in accordance with veto powers which are subject to being overridden by an absolute majority of the Economic Council. This absolute majority is distinct from a simple majority and requires one more vote than 50 percent of the authorized membership of the Economic Council. It is believed that the powers given to the Council of States, which represents the several States, are in fact sufficient to protect the interests of the individual States.

(b) The powers of taxation given to the bizonal administration are definitely limited to customs and excise taxes and to that percentage of income tax essential to meet expenditure programs approved by the bizonal occupying authorities. The collection of taxes is left to the States. Experience over the past year has shown that a bizonal administration without sufficient powers of taxation to meet its approved expenditure programs is almost helpless.

(c) The provision that the Chairman of the Executive Committee be selected without being subject to removal by the Economic Council was designed to assure a certain continuity of office under the present emergency conditions. It was believed undesirable, moreover, to prejudge the responsibilities of the executive as these may be later defined in a future German government, since it was felt that the choice between an independent executive or one responsible to parliamentary authority should be left open for later decision.

(d) The administration of departments in conjunction with representatives from the several States would result in a top-heavy structure which would make impossible a coordinated and effective bizonal economic administration. The bizonal departments have been given certain specific responsibilities which will no longer be the responsibilities of the several States. The States, however, retain all of the responsibilities not given to the bizonal administration, and this principle which is being asserted in the field of economic administration, is in full accord with the principles of federal government which reserve to the States composing that government all powers not specifically yielded to the central government.

(e) The appointment of justices for the high court representing the several States would not be consistent with the creation of an impartial court which is to weigh the interests of the respective States against the bizonal administration in an impartial manner. The proposed court is not a supreme court and in the absence of a constitution must be guided by the decisions of the occupying powers.

In conclusion the United States Government wishes again to emphasize that the new bizonal arrangements are not intended to prejudge the future German constitutional structure in the development-of which the French Government’s contribution will be welcomed. The United States Government requests understanding of the provisional measures which it has been found necessary to take in the present emergency.³

Washington, January 31, 1948.

1. Telegram 184, January 31, to Berlin, not printed, reported that comments submitted by General Clay served as the basis for this note (740.00119 Control (Germany/1–3148).
2. In an undated memorandum transmitted to the Secretary of State by Ambassador Bonnet under cover of a note of January 23, neither printed, the French Government presented detailed observations on what it felt were the excessive centralizing aspects of the bizonal (American-British) economic reforms. The memorandum concluded with five questions the nature of which are implicit in the formal responses presented in the note printed here and in the observations reported in telegram 234, January 28, from Berlin, p. 45. (740.00119 Control (Germany)/1–2348)
3. In a note of February 5, not printed, Ambassador Bonnet informed Secretary of State Marshall that the French Government had taken note of the assurances: contained in the note printed here and understood the purposes and urgency of the proposed economic measures for the American-British bizonal area of Germany. The French Government nevertheless felt that the only way to avoid having-such measures prejudge the definitive political organization for Germany was; to agree as soon as possible on the nature of that long-term organization. (740.00119 Control (Germany)/2–548)