London Embassy Files: Lot 59 F59 File 850 Marshall Plan: Telegram
The Administrator for Economic Cooperation Administration (Hoffman) to Certain Diplomatic Offices in Europe
confidential
Washington, July 13,
1948—5 p. m.
Ecato 60. Following are results top-level discussions here for problems raised by Repto 541 and Repto 24:2
[Page 468]- 1.
- You should miss no opportunities to make clear to OEEC and participating countries in most unmistakeable terms that we are increasingly dissatisfied with their conception of the nature and timing of ERP programs as revealed in general by recent cables but especially by new delay in fiscal 49 program to middle September and Cripp’s position that four year program be moved back to end of year. New OEEC time schedule means that for an indefinite period we will continue to be in the indefensible position of programming after the fact. In effect we have already done this for first six months of ERP. Inevitable result is that programming decisions have little or no influence on actual course of events during period they are supposed to cover, and ECA will be subjected to serious and justifiable criticism from Congress and public generally. Congress will not and should not approve an appropriation for next year which is unsubstantiated (a) by effective, ECA approved program of expenditure of fiscal 49 appropriations; (b) by ECA approved forecast of how we propose spend new appropriation for fiscal 50 and (c) by estimate of extent to which both annual programs implement agreed four year recovery goals. This means that we must have the annual programs and four year program from OEEC in time to permit adequate screening before end current calendar year. Even this time schedule is unsatisfactory as we wall have to justify fiscal 50 program before Budget Bureau during October, but we realize it is impossible for OEEC to do complete second annual program by then.
- 2.
- We are not only concerned by our lack of timely information on ECA-financed part of program but equally so by similar lack of information on total program. We will not continue practice of allotting funds in the dark beyond current quarter. It is clear to us that the Europeans must decide either that they need no dollar assistance from the US and consequently no programs or else agree to an orderly schedule of programs which will come to us in sufficient time to permit ECA to discharge its statutory obligations and carry out Congressional intent. In order enable OEEC to concentrate on both annual and four year programs in limited time available we are willing to relieve OEEC of burden of preparing quarterly programs at least for the next two quarters (fourth quarter 48 and first quarter 49). If we assume quarterly job ourselves, however it emphasizes even more strongly necessity of our receiving annual program fiscal 49 by September 1 at latest. All we will need from OEEC each quarter will be reconciled balance of payments tables for both Western Hemisphere and IntraEuropean trade and payments. Also, if OEEC suspends its quarterly programming we will require that any participating country desiring to deviate substantially or substantively from [Page 469] prorated approved annual allotment or rate of importation of important commodities during a given quarter must itself assume responsibility for getting prior OEEC clearance.
- 3.
- Hoffman and Bissell plan take strong position as outlined above in Paris.
Sent Paris Torep 129; rptd London Ecato 60.
Hoffman