The Secretary of State to the Legation in Austria
440. Dept concurs in course indicated last paragraph urtel 495 May 5.1 Lemberger, First Sec Aust Leg, in personal and unofficial conversation with officer Dept has discussed at length Soc policy on fourth party and maintenance coalition as disclosed in his private correspondence with Schaerf and Deutsch.2 Our impression based on this correspondence and activities Soc leaders is that Socialists are heavily exaggerating grievances with People’s Party which they would not do unless they believed this strategic moment for gaining dominant position among Aust parties, had decided seize opportunity, and believed that they could with impunity. Apparently count on no opposition from Sov and Brit and believe People’s Party can be torpedoed unless saved by open US support. Entire situation requires careful analysis and cautious treatment, particularly in view of reply which will be made by Bevin in Commons next week. Meanwhile in absence quadripartite agreement both general question and any related question of specific parties should be extensively examined in committees AC in order that problem may receive further consideration and if possible maintenance AC decision 1945.