740.00119 Council/3–2149: Telegram
The United States Deputy for Austria at the Council of Foreign Ministers ( Reber ) to the Secretary of State
1099. Delau 62. From Reber. As envisaged in my Delau 60,1 today’s meeting2 showed futility at present time of continuing discussions on questions of frontiers and reparations. In view of Department’s instruction contained in Ausdel 26,3 I have agreed with French and British to pass to other articles of treaty without further delay, although an attempt will be made leave continuously open return to these fundamental points.4
In discussing procedure at Foreign Office this afternoon, both Marjoribanks and Berthelot seem to feel that it might be possible to obtain Soviet concessions on frontiers and reparations by concessions of Western Deputies in respect to economic articles. This is clearly Zarubin’s tactic at the moment, from which Soviets only can derive the benefit. I pointed out that the nature of concessions Zarubin would wish us to make as the price for his agreement to treaty would be those which would permit continued Soviet control of Austrian industry. It will be recalled that Soviets have always refused to discuss necessary [Page 1085] conditions of transfer until agreement is reached on amounts. Marjoribanks, however, seems to attach less importance to these conditions than to possibility of agreement on text of treaty. I foresee, therefore, that if there seems to be possibility of agreement on figure for lump sum payment and some Soviet concession on oil properties there will be less insistency by British Deputy upon complete relinquishment by Soviets of their present control of industry in Eastern zone. Although I fully appreciate and understand desirability of not giving appearance of initiating any break at present, current Soviet tactics do not give promise of any real solution of these problems and are designed in my opinion to place responsibility on us for failure to meet their demands in respect of Austrian industry. In my opinion it is as important to prevent Soviets continuing control of Austrian industry as it is to prevent encroachment upon Austrian territorial integrity but it will probably be more difficult for Austrian public to comprehend need for inclusion in treaty of necessary safeguards. Even Austrian Government officials, including Gruber, seem inclined dismiss need for them if without them treaty seems possible. Our reluctance to conclude treaty without proper economic safeguards would consequently be open to misinterpretation to Austria, as lending itself to Soviet propaganda.
Sent Department 1099; repeated Vienna 62.