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

740.00119 Control (Germany)/11–1848: Telegram

The Acting Secretary of State to the Embassy in France

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us urgent
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Washington, November 18, 1948—7 p. m.

Telmar 175. For Carter. Martel 143, Nov 17; Deptel 4441, Nov 17.¹ Prior 1947 French advocated separate international regime for Ruhr detached from Germany. On eve Moscow CFM French had receded from demand for separation and insisted ownership Ruhr industries vest in powers active in war against Germany. At Moscow French proposed international regime with ownership and management rights.² US opposed special Ruhr regime but approved post-occupation supervision by international body of distribution Ruhr resources in interest equal access European countries, including Germany. US opposed international ownership or management on ground not desirable to “interfere with German responsibility for the management and operation of Germany’s resources . . . . Germany must have responsibility not only for the production but the marketing of the products of her own industries.” US desired “European solution in a Europe which included Germany.”³

Later in 1947 French modified position on Ruhr in various talks with US Reps, no longer insisting on international ownership but stressing desire effective control over management and allocation coal and steel. In talks with SecState at New York, 8 Oct 1947, Bidault noted French abandonment earlier demands for territorial separation, special political regime and international ownership and operation Ruhr industries. He stated as minimal demands retention by occupation authorities adequate control German management, and permanent international authority with adequate powers to insure (1) equitable division Ruhr coal, coke and steel between Germany and European countries; (2) German use such resources only for peaceful purposes; (3) early establishment Ruhr authority prior end occupation. SecState expressed willingness clarify relation Control Board to German management and stated agreement in principle that Ruhr should not in future be under exclusive control any German Govt but should be operated for benefit both Europe and Germany and be integrated general European economy.⁴ SecState reiterated these views in Chicago speech of 18 Nov 1947.⁵

On 28 Nov 1947 SecState at London reminded Bidault re CFM that question international regime for Ruhr was certain to imply Sov participation in such regime.⁶ Ruhr issue not dealt with by CFM at London session due early termination.

At London six-power talks on Germany French Del proposed early establishment international authority Ruhr coal and steel control over management and allocation key products between internal use and export (27 Feb 1948).⁷ Such regime held essential to security and compatible German-European cooperation. US Del expressed fear excessive control make Germany susceptible to Communist danger and pointed out establishment intl system control would invite Sov participation. He opposed intl control management and was reluctant establish intl auth during occupation period. He wished intl auth, if and when established, to have as sole objectives insure Ruhr resources never used for aggressive purposes and enable German economy as integral part Europe contribute Eur recovery. Should be non-punitive and embody principle capable extension to adjacent areas similar character. In general UK agreed US views except for advocacy socialization Ruhr industry. US wished ultimate decision this issue rest with democratic German Govt.

As talks progressed US Del made following concessions to Fr: (1) Ruhr auth to be established in near future before end and prior establishment German provisional Govt; (2) occupation authorities would maintain “adequate control” over management; (3) Ruhr auth to have direct power of allocation (earlier US position was that auth should only supervise German allocations).

Fr press at close first stage London talks hailed results as victory Fr position, noting specifically tentative agreement to establish Ruhr auth (Paris 1210 to Dept, Mar 7, 1948⁸).

During second stage London talks Fr Del indicated general Fr acceptance tentative draft (TRI/7 Final) subject reservations re security guarantees. Fr Del stressed this aspect at all times and repeated attempts expand function Ruhr auth may be attributed fear German rearmament. Fr also urged inclusion safeguards foreign property and association Ruhr auth OEEC.

US Del proposed certain clarifications, chief aims of which were (1) preamble drafted so as elicit German cooperation; (2) German essential needs protected against abuse power Ruhr auth; (3) exclusion discriminatory practices; (4) protection US financial responsibilities re western Germany. Last point, in US view, meant during existence JEIA or successor Ruhr auth would only have advisory role re allocations. US also considered protection foreign interests should not be treated apart such interests elsewhere in Germany and opposed direct association Ruhr auth with OEEC. Central difficulty at final stage was necessity reconcile US requirement adequate protection US financial contribution German economy and freedom western Germany negotiate appropriate bilateral agreement with ERP administrator with general desire effectiveness international Ruhr auth not be substantially nullified for indefinite period (London 2020, May 10; rpt. Paris 211⁹).

Final Ruhr agreement (Report: Annexes C and D¹⁰) represents compromise conflicting views re above points. On question of ownership no agreement was possible. US–UK maintained position against intl ownership desired by Fr. Matter left not agreed with respective positions stated.

Fr National Assembly in approving London agreements reaffirmed (after Fr Govt had assured Nat Assembly ownership not settled) Fr desire internationalization Ruhr mines and basic industries and intent seek in application of Ruhr Agreement effective Fr participation in control German industrial potential and extension control by intl auth over administration Ruhr enterprises (Paris 3190 to Dept, June 17¹¹). However US–UK has repeatedly made it plain to Fr Govt that they did not believe likely their views could be changed on this issue.

Fr note to US (June 19¹²) urged question of ownership be settled quickly to harmonize conflicting views and maintained Fr preference for intl ownership of plants and basic industries and intl control of their administration. US reply¹³ brief and did not deal with question. Fr will undoubtedly continue efforts secure these objectives despite apparent relinquishment in intl discussions since late 1947.

Fr as anticipated renewed demands re ownership and management at opening London Ruhr talks (London 4830 to Dept, Nov 11; rpt Paris 866¹⁴). Alphand also declared US–UK bizonal law No. 75 published Nov 10¹⁵ unacceptable to Fr, since Mil Govs had decided freely elected German Govt to determine final settlement of ownership coal and steel industries. This question not on agenda London talks but Fr position unaltered. Fr hoped to reopen question management at London, emphasizing Fr position that management, although not to be vested intl auth, be controlled by it through adequate powers supervise implementation production and re-equipment programs. Fr in note to US Govt protested Law No. 75 as fait accompli and argued this action beyond competence US and UK Mil Govs and proper subject for decision at governmental level only.

Essence Fr argument is that only method insure Ruhr resources not be used renew German war potential or hegemony over Eur is remove these resources from German control. This is major assumption which: must be challenged. Fr distrust and fear of independent Germans responsibility in this respect closely related to parallel situation being created by German economic recovery and imminent establishment German provisional Govt with substantial powers.

US position (similar to UK) re Fr objections to promulgation Law No. 75 is that Fr authorities have been consulted numerous occasions since Aug 23, that Fr and Benelux comments on projected law received and taken into consideration, and that early action was necessary to clarify ownership issue in interest increased German production and western Eur recovery. Fr kept fully informed at all stages. US fulfilled obligation consult Fr but this does not mean US obliged to agree. Ruhr question involves honest difference of opinion in which US position made clear previously. US attempted persuade Brit modify preamble language to statement of policy rather than Mil Gov decision re ultimate determination of ownership, but Brit insisted retention original wording.

US position re Fr arguments on ownership and management essentially as follows.

Intl ownership held impracticable and unnecessary in relation to desired objectives. It would entail complex juridical problem of extraterritorial rights for which no precedent exists. Operation of intl ownership regime limited to the Ruhr would be intolerable to democratic German Govt and undermine both its economic viability and political prestige. It would disrupt rather than facilitate orderly use German resources and give rise insuperable difficulties enforcement in post-occupation period. Germans would greatly resent deprivation Ruhr resources and issue would be exploited by Communists, nationalists and other extreme elements. Labor reaction likely to foment difficulties and cripple Ruhr production. German Govt friction with intl ownership regime would nullify endeavors achieve German cooperation recovery program and broad Eur interests. Believe security and equitable access objectives attainable through limited intl control and security arrangements as envisaged London Agreements.

Direct intl administration Ruhr resources and industries likewise, believed impracticable and undesirable. Direct control would undermine legitimate sphere authority German Govt, would be punitive in nature, premised on untrustworthiness any German regime, and would raise practical administrative difficulties similar intl ownership. Same objections apply in somewhat less degree to type of intl control over management now evidently envisaged by Fr. Existing and continued controls under occupation statute over management will effectively preclude excessive concentrations economic power, diversion Ruhr resources for purposes of aggression, or independent action by owners or managers in conflict with powers to be reserved to occupation auth under occupation statute. Discussion adequacy controls over management after end “control period” is subject for London talks. Alphand has indicated he will raise and US prepared discuss problem there. Uncertainty ownership question has long been burning issue with German democratic forces represented by trade unions and responsible political parties. US and UK feel German dem forces entitled to resolve problem under constitutional Govt.

US views re means satisfy legitimate Fr desires concerning Ruhr emphasize that Ruhr issue must be viewed in perspective total western German and Eur policy (Dept 4400 to Paris, Nov 13¹⁶). Only real security for Fr lies in developing constructive program political and economic organization western Eur in which Germany must share and make important contribution Ruhr because nature key resources must be vital factor in such program. Both US and Fr interested in increased Ruhr production. Fr shares in such increase and US Govt obligated to US people to reduce financial burden they are carrying in Germany. Development dem German Govt cannot be jeopardized by short-sighted and self-defeating restraints upon its normal and legitimate prerogatives re vital sector German economy. US contemplates ample safeguards security western Eur including Fr through other measures. Provision for security re Germany to be assured through application London Agreements (in particular Annex L¹⁷), occupation statute,¹⁸ and US support in Atlantic security system.¹⁹ A Ruhr auth along lines London Agreement will itself be substantial security safeguard. Fr should if possible be brought to realize extreme gravity any break in western democratic front in face common peril due to Sov and Communist threat. Fr should understand that firm US purpose to carry through comprehensive Eur program to successful conclusion is far better safeguard Fr security than US concession to Fr fears re German recovery and progressive resumption normal functions self-governing nation. Such concessions would, in US view, not only fail achieve ends desired by Fr but put in serious jeopardy entire program for Eur recovery and security as envisaged by Fr themselves.

Lovett

1. In telegram Martel 143, not printed, the Secretary’s Special Assistant, Marshall Carter, requested from the Department a complete briefing on the Ruhr problem in advance of the Secretary’s meeting with Schuman and McNeil on the afternoon of November 19 (740.00119 Control (Germany)/11–1748). Telegram 4441, November 17, to Paris, not printed, stated that a telegraphic summary of the development of the Ruhr problem was being prepared and would be sent shortly (740.00119 Control (Germany)/11–1748).
2. Regarding Foreign Minister Bidault’s statement on the Ruhr, made at the 25th Meeting of the Council of Foreign Ministers, Fourth Session, Moscow, April 10, 1947, see telegram 1297, Delsec 1414, April 10, 1947, from Moscow, Foreign Relations, 1947, vol. ii, p. 323.
3. The quotations are from Secretary of State Marshall’s statement on the Ruhr, made at the 25th Meeting of the Council of Foreign Ministers at Moscow, April 10. For the text of the statement, see Germany 1947–1949, pp. 329–330 or Department of State Bulletin, April 20, 1947, pp. 694–695. The Secretary’s statement is summarized in the telegram cited in the previous footnote.
4. See Secretary of State Marshall’s memorandum of this conversation on October 8, 1947 with Foreign Minister Bidault, Foreign Relations, 1947, vol. ii, p. 682.
5. For the text of the address under reference here, see Department of State Bulletin, November 30, 1947, p. 1024.
6. See the Secretary of State’s memorandum of his conversation with Foreign Minister Bidault on November 28, 1947, during the course of the Fifth Session of the Council of Foreign Ministers, held in London, Foreign Relations, 1947, vol. ii, p. 737.
7. At the Fourth Meeting of the London Conference on Germany (First Part), February 27, 1948, the French Delegation circulated a proposal regarding the Ruhr; for the text, see telegram 772, Delsec 1589, February 27, from London, p. 97. For a report on the discussion of the proposal, a report summarized in this paragraph, see telegram 774, Delsec 1587, February 28, from London, p. 98.
8. The telegram under reference here is not printed. For the text of the tentatively agreed paper on the Ruhr, see document TRI/7 (Final), March 5, p. 135.
9. Not printed.
10. Annexes C and D of the Report of the London Conference on Germany, June 1, 1948 (p. 309) are the same as documents TRI/16 (Final), May 26, and TRI/23 (Final), May 26, pp. 285 and 290.
11. Not printed. Regarding Ambassador Bonnet’s note of June 19 informing the Secretary of State of the National Assembly’s reservations to the London Conference recommendations, see the editorial note, p. 337.
12. See the preceding footnote.
13. See the editorial note, p. 337.
14. Ante, p. 476.
15. See the editorial note, p. 465.
16. Ante, p. 492.
17. Same as the Conference document entitled “Report on Security”, May 26, p. 291.
18. For additional documentation regarding the preparation of an occupation statute for Western Germany, see pp. 597 ff.
19. For documentation on the negotiations leading to the North Atlantic Treaty Organization, see volume iii .