ECA Telegram Files, FRC Acc. No. 53A278, Paris Toeca: Telegram

The Acting Chief of the ECA Mission in France (Reed) to the Administrator for Economic Cooperation (Hoffman)


Toeca 861. (Section 2 of Toeca 860). Please deliver immediately to Harriman and David Bruce. Reference Toeca 860.

Petsche asked to see Tomlinson1 to request that Harriman and Bruce be informed immediately that Reynaud’s statements were entirely Reynaud’s responsibility and that he had not been authorized to speak in any way for French Government. Petsche said he had no information on Reynaud’s remarks other than press report but, if Le Monde’s story was accurate, he was extremely annoyed. He went on to say that he was certain Bruce realized that, if the French Government had any comments to make on ECA policy, they would be made [Page 643] directly to Bruce. Petsche said he was concerned because it was widely known that Reynaud had consulted officials in French administration before departure to US.
Petsche said French credit policy was major factor in remarkable improvement in French economic and financial conditions. He continued that Queuille intended deal immediately with additional measures necessary to consolidate financial improvement and present credit policy would continue to play its important role. Recent speech by Faure (Secretary of State for Finance) implying that credit controls were to be relaxed was without foundation. Petsche said he had asked Baumgartner,2 Monnet3 and other advisers to draw up new financial programs in time for presentation to Parliament when it reconvenes. Petsche would not be drawn out on estimated gaps in public finances. Only additional taxation possible in his view was from gasoline and he hoped he could convince his colleagues to obtain about 20 billion from that source in connection with free sale. Problem of additional military expenditures has not changed except that Ramadier4 has nipped his figure to an even higher level.
In connection with Reynaud comments, mission wishes to point to Reynaud’s record last year. At that time his policy of a realistic line for labor but an easy one for other groups in community combined with his opposition to any limitations on credit contributed to serious deterioration of economic and financial conditions.
Views of French officials on possible financial measures to be taken are not crystallized enough for comment.

Pass to State and Treasury.

  1. William M. Tomlinson, Representative at Paris of the Department of the Treasury, and Chief of the financial division of the ECA Mission in France.
  2. Wilfrid Baumgartner, Governor of the Bank of France.
  3. Jean Monnet, Commissioner General of the Plan for Modernization and Reequipment of the French economy.
  4. Paul Ramadier, French Minister of National Defense.