Foreign Relations of the United States, 1950, Western Europe, Volume III

S/S–NSC Files: Lot 63 D 351: NSC 82 Series

The Under Secretary of the Army (Voorhees) to the Secretary of State

top secret

Washington, 10 April 1950.

Dear Dean: During the last two months, I have been conducting, at Secretary Gray’s¹ request, an intensive survey as’to what the Army might do to increase the defensive capabilities of Western Europe. Participating actively with me in this work have been Dr. Vannevar Bush,² Assistant Secretary Alexander,³ and some of our outstanding combat generals.

While this, as all studies do, has brought to light certain weaknesses, it has also developed the existence of dramatic progress in certain essentially defensive weapons for use against armor. These are so encouraging as to make it reasonable to anticipate that, by maximum joint effort with our Allies, we will have it in our power in three to four years to make the heavy tank obsolete, and so radically to alter the present unfavorable military balance of land warfare in Western Europe.

Further, these weapons offer two significant advantages:

(1) They will be inexpensive to build, and of a character probably to make it possible to modernize effectively some of our World War II armor.

(2) The weapons will be essentially defensive in character, so that they will not be of a kind to constitute a threat to Russia which might tend to trigger-off a war on her part.

Your Mr. Bohlen appeared before our study group and gave an invaluable appraisal of the present situation. At that time we reviewed with him generally the lines of our thinking as above mentioned. I subsequently dictated notes as to Mr. Bohlen’s views, which were to us most interesting and constructive. I shall send a copy of these to you under separate cover.⁴

Concurrently with this survey, I have been studying the subject of means to make it possible to produce these and other weapons in adequate quantity without an undue increase in our military budget. It is obvious that this is possible only by greatly increased military production in the Western European nations, accompanied by some authoritative coordination of that production so that each nation will contribute what it is best fitted to furnish for an over-all defensive plan. (This could include production by Germany of supplies which would not create a German war potential, including steels which could be shipped to the Western Allies for manufacture into weapons.)

On 21 March, with Secretary Gray’s approval, I submitted to Secretary Johnson a memorandum outlining a plan which might help to accomplish this. This memorandum has been circulated and studied in the Department of Defense, and recently I learned that a copy of it had been given to the President. Accordingly, on 5 April I wrote Secretary Johnson suggesting that a copy of the memorandum be furnished to you. He approved. I am therefore inclosing copy of the original Top Secret memorandum,⁴ and also copy of a revised form of the memorandum with certain modifications making it possible to downgrade the classification to Restricted. This, however, contains the essential argument.

All of the above action was taken without reference to JCS 2101/1 and its accompanying State–Defense study. It does, however, have a real bearing, I believe, upon 2101/1, particularly in (a) the information as to development of essentially defensive inexpensive weapons for use against Russian armor, (b) the increased morale of our Western Allies and the resolution to defend themselves which these developments and the vigorous application of them may well enable us to bring about, and (c) the means of controlling the dollar cost of any required increase which may be found necessary in our military program.

Should you care to discuss these matters further, I am of course available at your convenience.

Sincerely yours,

Tracy S. Voorhees

[Enclosure—Memorandum]

restricted

[Washington,] 5 April 1950.

A Proposal for Strengthening Defense Without Increasing Appropriations

i. background

a. Change in emphasis in Russia’s threat to Europe:—Two years ago, Russia’s threat against Europe was primarily a covert one of conquest by subversive methods. While this was proceeding successfully, there was relatively little threat of overt military action. The European Recovery Program was in essence a defensive weapon forged to resist Russia’s subversive threat. It has been highly successful in this main purpose, but less so in its secondary objective of closing the dollar gap.

Thus arrested in conquering Europe by her subversive techniques, Russia’s continuing high armament production, plus her atom bomb, has increasingly emphasized the threat of overt military action. This is backed up by her great weight of fine mobile artillery, 40,000 tanks, and enormous quantities of tactical aircraft.

As a result of the above changes, probably our greatest military danger for the next several years is that the Russian Army will overrun Western Europe. This would probably result in a prolonged war of many years.

b. Need for more and better defensive weapons:—Establishment of a better military balance as a deterrent against such a Russian attempt, and to stop it if made, is imperative. Because this would be primarily a land attack, plans to avert or defeat it are largely a ground force job, assisted by tactical aircraft. To assure that nothing in the Army’s power to do is being left undone, the Army is currently making an intensive review of its program, particularly as to research and development in defensive weapons to stop Russian armor, and especially those weapons which are inexpensive to produce which the European nations could make for themselves in large quantities.

Entirely by coincidence we have just received the following expressions of opinion from Europe. These strongly corroborate the views previously held here which had led to the Army’s study above mentioned:—

(1) A statement from one of our ablest officers now serving in a key post in the military assistance program, that because the necessary rearmament to be able to stand off the Red Armies will tax the Western European economies, we must give “top priority both as regards time and expense” to develop cheap and portable weapons which will make the tank obsolete; that this “would make an enormous and perhaps vital change in the so-called armament race.”

(2) A report giving the views of an outstanding Western European leader that:—

“the world situation is ‘gradually deteriorating’ and that insufficient progress is being made to counteract this deterioration through ‘fostering a sense of unity in the West.’ * * * that little progress can be made so long as Western defense budgets are approved or disapproved on primarily a national basis instead of being adjusted to the role of the country in an over-all defense plan.”

(3) Messages from U.S. representatives in Europe expressing serious concern at the recurrence of a tendency toward a neutrality concept, in some quarters, and the need of countering it.

c. Changes tending to offset such threat:—Since two years ago when ERP was launched, the following profound developments have occurred concurrently with the change above noted in the character of the Russian threat:—

(1) Recovery of production in Western Europe from partial paralysis to a level about one-third above prewar totals and to a point where these countries are now seeking markets. (This revived economy could be, but is not yet effectively, employed for European defense.)

(2) The U.S. has made the basic political decision to defend herself in Western Europe.

(3) To make this possible, the U.S. has formed an alliance through the Atlantic Pact.

(4) To further such defense in Europe, the U.S. has adopted MDAP.

(5) There is a considerable body of authoritative opinion that scientific developments are such as to make it possible to produce relatively inexpensive, purely defensive weapons of great potency against land attack, which could make the heavy tank obsolete.

d. Present weaknesses are:—

(1) That if U.S. dollar military assistance is to be a main reliance for European defense, preliminary Army estimates are that it would have to be several times the $1,148,000,000 proposed for FY 1951. Yet the latter sum represents the most the U.S. can reasonably do, facing as it does a budget deficit.

(2) That the recipient nations, instead of being stimulated to greater military production from their own budgetary funds by such American assistance, are thus far doing discouragingly little.

(3) That the order of magnitude of the effort required to make a successful defense of Europe feasible in the near future is greater than that of which the present machinery of our military assistance plus self-help from the European nations’ own budgets is capable.

(4) As the statement above quoted shows, that there is now no adequate central direction and planning of the several nations’ own efforts which possesses the requisite authority or influence to produce optimum results.

(5) But the central weakness is that ECA, the one powerful organization we have which holds the principal purse-strings, is under the present law limited in its mission to promoting economic recovery, not to stimulating military recovery. Through its bilateral agreements with recipient countries, ECA has the control necessary to bring about the effective utilization for U.S. objectives of our dollar assistance and of the counterpart funds arising from it. ECA has strong missions in each of the countries with intimate knowledge of their economies. Under the present law, the counterpart funds resulting from ECA aid are used for economic purposes. Yet the change in the character of the Russian threat makes it necessary, and the extent to which economic recovery has already taken place should make it possible, now to employ these funds for the joint and closely related purposes of military and economic recovery. The FY 51 budget for economic aid and relief for Western Europe would be sufficient if such aid is given by grant to produce counterpart funds of roughly the soft currency equivalent of 3 billion dollars. Counterpart funds are the commensurate amounts in local currencies received by such governments from the sale to their own peoples of the supplies furnished to such governments by American dollar aid.

The basic necessity for continuing economic assistance to Europe is to meet its dollar deficit. There is therefore no apparent reason on account of which the counterpart funds derived from such largesse could not be used, under appropriate provisions in the ECA legislation, to achieve such desired U.S. objectives in Europe.

ii. remedy

The time has clearly come to merge the U.S. organizations and appropriations for military assistance and for economic aid, under a modified charter, and to create a single powerful unit to accomplish both purposes. We could thereby not only promote but also protect European recovery. Through the counterpart funds and other means, we could greatly increase production of defensive military weapons in Europe. Even if only one-third of the possible counterpart funds from our FY 51 budget were so used, we could more than double the flow of new weapons which will otherwise result from our proposed military assistance program during the coming fiscal year.

Equally important, we could by such control of the purse-strings bring about the effective central planning of what is produced.

In such a plan, military and political considerations coincide in requiring that all emphasis should be placed upon essentially defensive weapons.

While some reorganization and military participation would of course be requisite, it would appear that the ECA organization here and abroad should be the backbone of the combined agency.

iii. the above plan would contribute to solution of the “dollar gap problem”

There appears to be a tendency to regard the dollar-gap which will be left in 1952 as the main U.S. problem, instead of the even more serious military weakness of Europe. While it seems to be generally admitted that Europe will have a continued dollar deficit which we must make up, there seems not to be adequate realization of the fact that such inescapable dollar assistance (through the counterpart funds arising from it or as a direct condition of the aid) could be so employed as to effect a corresponding increase in Europe’s military production, as well as to shape and correlate such production into a sound total defensive plan. It would thus achieve a vital U.S. objective.

Under the plan herein proposed, increased military production would also assist in sustaining the Western European economy by providing a market which it needs.

iv. the above plan also appears to be timely in the present atmosphere of public concern about defense

The reduction in U.S. defense spending made during the past year has been vigorous and necessary. However, the concurrent development of Russia’s atomic bomb, the talk of the hydrogen bomb, the Russian conquest of China and the knowledge of Russia’s concentration on increased armament, have collectively created grave public anxiety. The public seeks some new assurance about defense. A sound, affirmative program, which would assure a great strengthening of defense at its point of principal weakness without increased dollar appropriations, would be the most effective answer. Further, it would be a means of carrying out Mr. Acheson’s “total diplomacy” by creating a “situation of strength” in the focal area of present weakness which is Western Europe.

Tracy S. Voorhees

1. Secretary of the Army Gordon Gray, appointed by President Truman in March as his special assistant in charge of a study designed to develop recommendations on U.S. worldwide economic policies and programs.
2. Vannevar Bush, former Chairman, Research and Development Board, National Military Establishment.
3. Archibald S. Alexander, Assistant Secretary of the Army.
4. Not printed.
4. Not printed.