740.00119 Control (Austria)/5–2048: Telegram
The Minister in Austria (Erhardt) to the Secretary of State
639. Austrian Government today delivered formal protest to Allied Council over action of Council May 14 in approving 600 million schilling occupation costs for year 1948, to be divided equally among four occupying powers. This sum amounts to 10.50% of Austrian budget though since US share is not paid actual percentage is smaller.1 [Page 1422] Austrian diplomatic representatives being instructed to deliver similar protest directly to governments of four occupying powers. Note to Council also request moratorium on payments pending conclusion of treaty discussions.
Legation informed that government considers occupation costs excellent issue to dramatize Austria’s present position and demonstrate to Austrian public zeal of government in face of threatened breakdown of treaty negotiations. Government was apparently taken by surprise by action of Council in prescribing occupation costs for whole year rather than single quarter and Gruber informs us that considerable irritation was manifested at Cabinet meeting yesterday over failure of Western Allies to “consult” Austrian Government before taking action (Austrians have never been consulted in past on fixing of occupation costs).
In letter to me May 152 Gruber expresses deep concern of government over decision which involves payment of 150 million schillings to Soviets. He states US-Austrian agreement on occupation costs was one of political highlights of last year and “Austria, therefore, expected the US in view of their strong position to oppose energetically any reassessment of occupation costs”. Letter continues “fact that such a decision should have been taken without previously consulting competent Austrian author[ities] could easily lead the Austrian people to believe that also in the Western countries the ideas still persist which originally governed the occupation and that they go on considering themselves as a military authority with regard to Austria. There are various other signs in support of this view which I will eventually deal with later on”. Gruber adds “May I suggest that the necessity will arise soon for the Austrian Government and the Western powers to define the intentions of the occupation policy allowing for the march of time and taking especially into due consideration the new international situation created through Austria’s participation in the organization of the 16 nations.”
As Department is aware both British and French have previously made clear their inability to forego occupation costs and US has, therefore, not been in position to support Austrian Government on this issue. Moreover, British have insisted and we have concurred that four occupying powers should each receive equal share of total prescribed costs. Sum approved by Allied Council was compromise between higher Soviet and lower US figure and agreement was reached only after prolonged negotiations commencing last January among four high commissioners.
Sent Department 639, repeated London USDel 155.
- Documentation on the U.S. renunciation of its share of the occupation costs on June 21, 1947, is printed in Foreign Relations, 1947, vol. ii, pp. 1167 ff.↩
- Not printed.↩