762A.02/4–1250: Telegram
The United States Commander, Berlin (Taylor) to the Office of the United States High Commissioner for Germany, at Frankfort1
priority
638. From USCOB. City Treasurer Haas has returned from Bonn with news that Finance Minister Schaeffer will provide only DM 30 million financial assistance Berlin budget month of April whereas actual requirement to meet April deficit is DM 60 million.
Schaeffer failure to pay additional DM 15 million needed for March has resulted in inability to meet Berlin City payrolls for last half March including police.
This has caused big stir here and constitutes serious blow Berlin morale at time when Bonn’s shoulder should be strongly behind city government. It seems clear Schaeffer thinking that US will bail out Berlin in any event.
It is odd coincidence that Schaeffer is providing exactly 20 million less than original estimate of DM 15 million budget deficit for April, making it appear as though he had simply deducted the 20 million counterpart aid just provided for Berlin emergency public works program.
Feeling against Schaeffer running high here as in effect he is being charged with stabbing Berlin in the back financially and rendering ineffectual strenuous efforts made by HICOM to relieve Berlin unemployment and speed Berlin recovery.
On US side it should never be forgotten that Schaeffer was removed from office as Minister President of Bavaria in 1945 and his freedom of movement restricted.
In an “off the record” press conference last week in Bonn Finance Minister Schaeffer reported by reliable sources to have commented as follows:
“Questioned on his visit to Berlin, Schaeffer spoke highly of the courage and the political activities of the Berliners. He stated except in Bavaria nowhere else people fight against political affairs with such strong passionate feeling. In this connection the Finance Minister mentioned the Berliners are practically suffering from an island complex and believe—which is entirely wrong—the whole world looks upon Berlin as upon center of fate. This be the only explanation to him the Berliners do not quite realize or do not want to recognize that the Western Allies have practically left them in the lurch last fall by cancelling the GARIOA funds for Berlin, referred them to the assistance of the FedRep. Dr. Schaeffer considered to be an unmistakable sign of the true intentions of the Western Allies in Berlin. After being reminded that, if his understanding is right, also the leading Berliners would express similar ideas in private talks, Schaeffer replied it be a well-known experience that men simply do not see things they are [Page 842] afraid of and which, in any case, would approach them, because they do not want to see them and rather imagine things than clearly face the dreadful reality.”
Strongly recommend seriousness of situation be called at once to attention of Adenauer who should insist on its immediate correction especially in view of his forthcoming speech in Berlin 17 April. Adenauer may receive cool reception Berlin unless FedRep gives stronger evidence of genuine cooperation than Schaeffer position. Seems clear FedRep or at least Schaeffer not acting in good faith. In this connection, strongly concur Deptel 7 April, sent Frankfort 2407, repeated Berlin 104, Paris 1544.2
Sent Frankfort 638, Bonn 43, Department 529, Paris 159 for OSR.