751.5 MSP/2–1252: Telegram

No. 504
The Acting Secretary of State to the Embassy in France1

top secret

4841. Paris pass Harriman and Draper, Labouisse, Richards. Ref Embtel 4924 Feb 122 & Deptel 4811 rptd London 3876.3

Legal and policy issues concerning best means dealing with financial gap in desirable French defense program still under urgent consideration here. Under acceptable conditions, it does appear possible that $200 million might be made available from FY 52 funds for application during this CY beyond the $270 million already provided from economic aid funds, and $30 million special assistance for IC, in forms directly (a) contributing to French defense program support, or (b) relieving the French defense program by an equivalent amount. Whatever amounts and techniques finally determined we would prefer making maximum in form procurement eligible hardware for use in Indo-China, perhaps piecing out small amount with direct aid from already available economic aid funds. Items would in any case have to be on JCS eligible list. Method and conditions of procurement still under study.
Understand that an immediate indication of what US is prepared to consider is essential (a) to obtain satisfactory French force and expenditure commitments for 1952 as part material being finally assembled by TCC Sunday for presentation to NAC Wednesday, and (b) to avoid possible French misunderstanding as to maximum US could do.
It is therefore suggested that Fr might be informed as follows:
If France would undertake physical defense program of the size and character outlined in Embtel 4925 Feb. 11 [12],4 and devote to that program during CY 52, 1225 billion francs out of France’s own resources, it may be possible for the U.S. to provide, and the U.S. is prepared to consider providing, out of FY 52 Mutual Security funds up to $200 million in forms directly contributing [Page 1166] to the French defense effort, including the effort in IC, in addition to the $300 million already made available out of FY 52 funds. The actual possibility of making the funds available would depend upon the working out of satisfactory procedures ensuring the appropriate control of the funds and their application to the desired objectives. To the greatest possible extent this additional support would take the form of procurement or supply of eligible end-items for use in Indo-China; supplementary methods would be considered if $200 million could not be found in that form.
The US Executive Branch will be proposing to the Congress in March a program including substantial amounts for support of the French and Indochinese defense efforts in FY 53. Additional resources accruing to France as a result of such assistance should be applied to their CY 53 defense effort, or, if actually realized in 52 should be applied as an addition to the total defense effort referred to in para A.
Not yet possible to make firm commitment. Procurement for IC requires Presidential action for transfer Title I to Title III military assistance funds and consultation will probably also be required with Congressional Committees in advance of firm commitment.
This message approved by Foster, Defense.5
  1. Drafted by Lincoln Gordon of the Office of the Director for Mutual Security and cleared with Merchant, Cleveland of the Mutual Security Agency, Foster of the Department of Defense, and Willis of the Department of the Treasury. Repeated to London for Acheson and Nash.
  2. Document 499.
  3. Telegram 4811 offered a preliminary recommendation that the United States purchase, out of Title III military funds obtained through a transfer from Title I, eligible military hardware produced in France for use in Indochina. (751.5 MSP/2–552)
  4. Document 500.
  5. According to telegram 5036 from Paris, Feb. 16, when Labouisse informed Clermont-Tonnerre of the contents of paragraph 3 of this message, Clermont-Tonnerre indicated that it would be extremely difficult for France to increase expenditures from its own resources to 1225 billion francs for calendar year 1952. He also emphasized his desire that something be put in writing concerning the amount, nature, and timing of U.S. assistance for fiscal year 1952. (751.5 MSP/2–1652)