762A.5/3–4751: Telegram

The United States Deputy High Commissioner for Germany (Hays) to the Secretary of State 1

top secret

633. Eyes only for Byroade. The seventh conference on German contribution to European defense was held today March 16.2

The same German delegation was present as at the previous conference, and the same personnel present for the US, British and French.

[Page 1028]

The item previously agreed upon for discussion at this meeting was the estimated cost of German military contribution in accordance with the assumed German plan for European recruitment and training, and the assumed numerical figure of 25,000 [250,000] strength for the year 1952.

The German delegation stated there were two aspects to this problem. One was the cost of the German military contingents; the other was the question of how this problem would be related to the total amount that Germany could contribute in the light of the social situation within Germany, and the payments now made by Germany for occupation costs and mandatory expenses.

The statement made by Blank that he had been informed by the Federal Ministry of Finance that no more than six billion Deutsch marks could be contributed for defense purposes, under present social conditions in Germany. This amount was already used for the requirements of Allied forces under occupation costs and mandatory expense, and left no funds available for the financing of German contingents.

Blank further stated that in their view the German military contribution must not be permitted to be stopped because of fiscal reasons and therefore other methods to raise revenue must be discussed, including the question of loans.

The Allied representatives stated it was not their intention to discuss the problem of what Germany could contribute, and the relationship between the cost of the support of NATO troops and the cost of support of German contingents to this total contribution, that this was a matter to be left to the financial advisors. The Allied representatives did want to know, however, insofar as could be ascertained, the estimated cost of the German military contribution without discussing now how those costs would be met.

The German delegation stated they were handicapped by lack of any records of the Wehrmacht and Reichwehr which could be used in the preparation of estimate of costs. Moreover, they would require a large part of their armament and equipment to be furnished by the West Allies, and they would have to secure the costs of such items from the government of source.

The German delegation also stated that the lack of knowledge of firm plans regarding the kind and type of units to be organized, and the total strength, handicapped their efforts to procure cost estimates. They were not prepared to give any estimated sums at this meeting. After discussion it was agreed that at later meeting, they would provide estimates under the following headings:

Non-recurrent items of initial armament and equipment for their troops.
Non-recurrent items of troop-handling housing, training areas, ranges and stores.
Current expenses to include pay, hospitalization, spare parts, et cetera, on an annual basis.
Current expenses to include maintenance, housing accommodations, stores, and training areas, included in item 2 above.
Current expenses involved in training exercises to include maneuvers, ammunition, et cetera.

The German delegation stated they could compute fairly accurately items (2) and (5). In connection with item (1) however, certain assumptions would have to be made with regard to what armament would be produced in Germany and what armament would be provided by the Western Allies.

It was agreed to hold the next meeting on Friday April sixth at which time the German representatives would explain in detail the establishment of the office for national defense; their views on the composition and organization of the German tactical air force; and their concept and proposals regarding the air defense of critical areas, including an air-warning system. At this meeting they would also set forth their views in regard to the composition, organization and equipment of German naval and coastal defense forces.

[ Hays ]
  1. Repeated to Frankfurt eyes only for McCloy, to Heidelberg eyes only for Handy, to London eyes only for Spofford, and to SHAPE Paris eyes only for MacArthur.
  2. A copy of Buttenwieser’s notes of the seventh meeting, sent to Byroade on March 20, is in file 740.5/3–2051.