740.00119 EW/3–1849: Telegram

The Ambassador in the United Kingdom ( Douglas ) to the Secretary of State

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1075. For Murphy from Douglas. 1. In accordance the request you made in our phone conversation this afternoon1 we have carefully [Page 576] considered the possibility of joining the continuing discussions of occupation statute and trizonal fusion with my talks on PRI and Humphrey list.2 Our reasoning, which I think explains my reluctance to combine these negotiations, follows for what it is worth.

2. Our conclusion stems from review of the path we have traveled to reach this point. When we first asked the British and French to reduce the reparation program, I told them in good faith that only 30–40 plants were involved. The figure subsequently rose to 40, 70 and finally to 167. When we finally requested their agreement to the Humphrey report, we asked a quick reply. For six weeks we refused join PRI and the Humphrey list although the PRI talks had been continuing for nearly six months. We required as a condition of our taking part in the present PRI talks that they be completed in four or five days and I have made much of this deadline in order to keep the heat on.

3. We feel we are about to obtain a great deal in terms of plants retained in Germany in accordance with the Humphrey recommendation and in terms of the elimination of restrictions on a whole group of German industries. The concessions we may have to give do not seem excessive. The major ones are synthetic rubber, an uneconomic industry in Germany, and shipbuilding, an industry in which our position is likely to be fiercely attacked at home in Congress as too generous to the German shipping industry. We have required Bevin and Schuman to take serious issue with their Cabinets and especially their service ministers on matters which they feel affect the security of their countries.

4. I am not sure that we must finalize the occupation statute or principles of trizonal fusion so quickly in view of the necessity of Washington discussions on arrangements for financial contributions, the necessity to work out the structure of Allied administration in Germany, and our own lack of knowledge regarding the nature of the organization which will evolve in Germany. In addition, the German basic law is apparently still developing slowly.3

5. I believe the British and French are presently very suspicious as to our real motives and intentions regarding Germany. The remaining occupation statute and fusion issues are comparatively abstract questions of an entirely different order than those involved in PRI and Humphrey discussion.

6. The scars that insisting combining talks on occupation statute and fusion would leave here, even if their introduction did not lead to a break-down of our nearly successful negotiations, would embitter our [Page 577] relations French and British, not only in relation to German matters but generally. It is my considered opinion that British and French would view such an attempt at this late stage as a breach of faith.

7. Combining the negotiations would wreck more than this deal.

Sent Department 1075; repeated Paris 197 for Caffery.

Douglas
  1. No record of this conversation has been found in Department of State files.
  2. For documentation relating to the discussions of the occupation statute and trizonal fusion, see pp. 1 ff.
  3. For documentation relating to the promulgation of the West German Constitution (Basic Law), see pp. 187 ff.