740.00119 Control (Germany)/12–1048: Telegram

The Acting Secretary of State to the Embassy in the United Kingdom


4594. ToRuhr 22. For Douglas. We have given very careful consideration to proposals contained in Ruhrto 341 which might form basis for subsequent discussions. In meanwhile, however, you are authorized make proposal along following lines, bearing in mind our desire to separate Fr preoccupations re security which we are desirous of meeting from the competitive aspects of their proposal, which we cannot support.

Useful starting point is Clay formula in Berlin’s 9082 modified as you suggest by substituting Govts for Mil Security Bd thus enabling [Page 557] Benelux participate in recommendations. We are also prepared to state we agree in principle now as to necessity establishing in post-control period measures designed provide against excessive concentration economic power and against return important Nazi supporters. Exercise necessary powers these fields by IAR would now not be precluded and suggestions in Ruhrto 34 might usefully be considered if necessary this stage to specify greater detail our agreement in principle as type arrangements we might favorably consider in future. (Formula of Art 10–b Annex C3 also might be useful in this point.)

We also feel Germans themselves will be equally interested providing against excessive economic concentration and return Nazis and could usefully participate in future formulation detailed program this respect. This is particularly important if such measures are to be included within scope IAR since we must insure Ger cooperation with this body. On other hand in field security alone Allies are entitled impose own restrictions.

As to proposals re control investment and production in coal and steel, you shd propose initially amended Clay formula that Govts would determine which of current functions coal and steel control groups shd be retained in post-control period. You shd try avoid further commitments this field now but if impractical you may explore along lines of paras D and E Ruhrto 34. This together your assurances re level steel production prior to peace settlement however shd be helpful.

We also sending tel in re prohibited and restricted industries which shd assist in this connection.4

You may also indicate Brit and Fr privately we are now exploring possibility three powers agree endeavor jointly formulate agreement which could adapt principles Byrnes Disarmament Treaty5 to new conditions in Germany and absence of quadripartite measures this respect. We cannot commit ourselves to such agreement at this time until we have had further opportunity explore matter with Congressional leaders but our willingness consider such procedure may be helpful discussions with Brit and Fr.6

  1. Supra.
  2. Same as telegram 2876, December 5, from Berlin, p. 547.
  3. The reference here is to document TRI/16 (Final), May 26, p. 285, which was included as Annex C to the Report of the London Conference on Germany, June 1, 1948, p. 300.
  4. The reference here is presumably to telegram 1946, December 10, to Berlin, repeated to London as 4620, not printed.
  5. See footnote 3 to the memorandum of the Secretary of State’s press conference of November 24, p. 529.
  6. This telegram was repeated to Paris as 4719 and to Berlin as 1934.