No. 470

763.0221/1–451: Telegram

The Ambassador in France ( Bruce) to the Secretary of State 1


3805. From Dowling. Although Soviet rejection of British proposal seems almost certain, and little progress has thus been made towards quadripartite solution of occupation costs, meeting yesterday was helpful in clarifying British and French attitudes on overall [Page 1013] question.2 Basically British and French are concerned that expense of Austrian occupation should not fall upon their respective treasuries and any wish to lighten burden on Austria or reduce occupation revenues to Soviets is wholly subordinated to this factor.

In arguing against settlement of 1949 and 1950 costs British insisted Austrians would thus be spared further expense these years and Soviets denied any additional revenues. In discussion their proposal however they admitted their desire to maintain occupation costs in 1951 at approximately level agreed upon by AC for 1948 as well as continued provision of cash allocation to each element.

French, although less rigid, and preoccupied for present with necessity of obtaining their immediate requirement of some 25 million schillings were likewise unwilling to commit themselves to any substantial reduction in occupation costs.

Both British and French were however agreed that quadripartite settlement was essential for protection of Austria against pressures which Soviets could exert in any unilateral action, and British are willing to reexamine their position if their new proposal does not receive quadripartite approval and thereby satisfy immediate French needs.

On this basis it appears advisable to concur in British action to place their proposal before AC at January 12 meeting.3 I would strongly recommend however that US not abandon its present resolution on 1949 costs which as Department is aware is still before AC, until Soviet reaction to British initiative becomes known. This would have advantage of maintaining quadripartite consideration of question while affording Department further period in which to determine how far it may wish to go in bringing pressure to bear on British and French to pay at least some substantial part of their occupation costs. It is now apparent that our double aim of lightening burden on Austria by means of progressive annual reductions of costs, and of proportionately reducing revenues available to Soviets in services and cash, can not be achieved without some sacrifice on part of British and French, and this in turn will require greatest persuasion from US. [Dowling.]

  1. Repeated to Vienna and London.
  2. A detailed account of the January 3 meeting of representatives of the United States, the United Kingdom, and France is in telegram 3802 from Paris, January 4. (763.0221/1–451)
  3. The verbatim text of the British proposal on occupation costs was transmitted in telegram 3836 from Paris, January 5. (763.0221/1–551)