Foreign Relations of the United States, 1951, European Security and the German Question, Volume III, Part 2

398.10–GDC/11–851: Telegram

The United States High Commissioner for Germany (McCloy) to the Acting Secretary of State ¹

secret   priority

Bonn, November 8, 1951—1 p. m.

346. Verbatim text. AGSec from Slater. Fol is summary report council meeting held Bonn-Petersberg 8 Nov with McCloy (US) chairmen, Poncet (Fr) and Kirkpatrick (UK).

1. Berlin and East–West trade situation.

(Ref Dept to Frankfort 2869, rptd Bonn 220, Berlin 182, Paris 2746, London 2395, Moscow 326 of 6 November; Bonn to Dept 308 rptd Frankfort 430, Berlin 70, Paris 123, London 11, Moscow 23 of 2 November²).

I gave colleagues fol report my meeting with Chancellor and Erhard this subject on 7 November.³ I had opened meeting by referring to unsatisfactory developments in Berlin trade sitn recent weeks and proposing that Fed Govt immediately stop all shipment of those goods in which East is particularly interested, i.e., iron and steel products (including pig iron, rolled products, sheets and miscellaneous, machinery (broadly defined to include vehicles, shipbuilding, etc.), chemicals and rubber. (This was maximum position which Kirkpatrick and Poncet wld agree to at informal meeting of HICOMs held prior to my interview with Chancellor and Erhard).

Erhard then said that during past few days number of favorable developments had taken place: approx 1,000 wbs. had been returned on November 6 properly stamped, there had been no interference with parcel post last few days, blocked freight cars had been returned, Rothensee ship lift and autobahn tax situation had been satisfactorily settled. Furthermore, Orlopp had just told FedRep reps in Berlin that he could resume discussions. Erhard felt these developments were clear indication of positive change in tactical position of Russians and in view of this Fed Govt and Berlin authorities thought it unwise at this time to provoke Soviets.

I then pointed out that, nevertheless, overall situation remained unfavorable to West and stressed that procedure for examination doubtful cases of WBS by Treuhandstelle and Transitselle had never been put into effect and that I regarded this as satisfactory solution of WBS problem. Allies and West Germans could not allow Russians to play cat and mouse game with them on this problem or get involved in another series of discussions a la Kaesong or Palais Rose.⁴ It was to our advantage, I said, to bring matters to a head now with East Zone authorities and Soviets and get trade restrictions cleared up while UN assembly was in session in Paris, because Soviets wld not want it thrown in their teeth at Paris that they were making difficulties in Berlin at variance with their peace propaganda.

In reply to question from Chancellor and in line with position previously agreed at informal meeting of HICOMs, I said that present commercial airlift wld rapidly be increased from present 93 tons per day to 150 tons. Such increase, I told him, wld of course mean using up DM 20 million of JEIA funds by early February rather than end of April, and wld also increase conversion liability of Fed Govt beyond $650,000 per month now agreed upon. However, before increase in airlift cld be agreed to there wld have to be clear demonstration of need, in view unfortunate experience when present airlift service was initiated. In any event no increase in airlift cld be contemplated before Fed Govt had initiated countermeasures. In meantime possibility of using some mil aircraft in an expanded airlift wld be explored. (Request Dept’s view this point). I also indicated that if effective countermeasures were taken HICOM wld be willing to recommend to three govts that all NATO countries shld be requested stop shipments to East Zone of commodities mentioned above.

At conclusion meeting it was agreed that if by Monday 12 November handling of WBS in Berlin remained unsatisfactory, Fed Govt wld put fol countermeasures into effect: (a) no WBS wld be issued or revalidated for iron and steel products, machinery (both as defined above), chemicals and rubber, (b) revalidated Vorgriff WBS covering these products wld be revoked to large extent.

Since discussion with Erhard after meeting showed there might be some misunderstanding as to interpretation this agrmnt, I proposed today and council agreed that I shld send letter to Chancellor today (a) pointing out that Fed Govt had agreed to institute countermeasures on 12 November unless satisfactory solution to WBS problem had been obtained; (b) making it plain that satisfactory handling WBS situation means fulfillment of conditions contained in Chancellor’s ltr of 21 September in paras (a), (b) and (c) (see AGSec/memo (51) 41⁵); (c) fixing meeting of HICOM econ advisers and competent Fed Govt reps on 12 November to review situation; (d) informing Fed Govt that their reps are to bring to meeting on 12 November list of revalidated WBS to be revoked, which econ advisors will then review to ensure that list is adequate.⁶

During council discussion Poncet said there was apparent desire on part of Soviets for four power negotiations on trade and communications restrictions and he felt Allies shld make some response to this desire. He suggested that deputy HICOMs, in connection with correspondence they have been having with Soviet authorities on marking of railway cars, might indicate to Sovs that Allies are always ready to “discuss this and other outstanding problems”. I said we had not as yet had any direct indication from Soviets that they were prepared to enter into four power discussions on trade and communications restrictions. Allies had only had a report to this effect from Ger trade delegation. Kirkpatrick said he thought it wld be mistake for Allies to initiate such discussions, as whenever Soviets thought we were anxious to take up subject they invariably raised their terms for agrmnt. He suggested and council agreed to wait until after 12 November to discuss this matter further.⁷

[Here follows numbered paragraphs 2–8, which reported on the High Commissioners discussion of the financial relationship between Berlin and the Federal Republic, controls on electronic tubes, AHC Law on possession of sporting weapons, legislation on monetary reforms, policy with regard to war criminals, activities of former SS groups, and the date of the next Council meeting.]

[Slater]
McCloy

1. Repeated to Berlin, Frankfurt, London, Paris, and Moscow.
2. Neither printed; telegram 308 from Bonn reported on a meeting between the Deputy High Commissioners and representatives from Berlin and the Federal Republic on November 2 at which Allied concern was expressed over the lack of unity between the Germans and the Allies on the question of the trade agreement; telegram 2869 to Frankfurt stressed that the question of unity should be taken up with Adenauer along with suspension of goods movements into the Soviet Zone. (462A.62B31/11–251)
3. An unsigned record of McCloy’s meeting with Adenauer and Erhard is in the Bonn Mission files, lot 311, D(51)1785.
4. For documentation on the Four-Power Exploratory Talks at Paris, March–June, see pp. 1086 ff; for documentation on the Korean armistice negotiations at Kaesong, see volume vii .
5. Not printed; Adenauer’s letter, designated 313–04 II/10894/51 was attached to AG Sec/Memo (51) 41 in the Bonn Mission files, lot 311, D(51)1419.
6. A copy of McCloy’s letter to Adenauer embodying these points, dated November 8, is in the Bonn Mission files, lot 311, D(51)1667.
7. At the meeting between the High Commission Economic Advisers and representatives of the Federal Republic including Kaiser, Vockell, Leopold, and Westrick on November 12 the German officials admitted that Soviet harassment of Berlin created an unsatisfactory condition, but they maintained that counter measures should be taken only if preceded by an increased airlift (462A.62B/11–1351). This was reported to the Allied High Commission which on November 16 agreed to increase the daily tonnage to 210–240 tons. (Telegram 396 from Bonn, November 16, 398.10 GDC/11–1651)