Foreign Relations of the United States, 1952–1954, Germany and Austria, Volume VII, Part 2

763.00/4–1153: Telegram

No. 859
The United States High Commissioner for Austria (Thompson) to the Department of State

secret

Vienna, April 11, 1953—1 p.m.

2926. In discussions with Chancellor Raab¹ on April 9 and 10 following questions were discussed in general terms:

(1) State treaty. Raab indicated Cabinet decision on withdrawal of abbreviated draft was less firm than Gruber had led us to believe. I explained to him yesterday (prior receipt Deptel 2978² reasons why we were reluctant withdraw abbreviated draft, emphasizing that our objective was an Austria independent both politically and economically.

(2) Restitution. I said I gathered from press that his government wished to take some steps for further rehabilitation of former Nazis. I explained our position that victims should come first and urged that they quickly institute negotiations with representatives Jewish organizations and pass further legislation to assist victims. Raab said Cabinet on Thursday had set up committee of three to be headed by Kamitz to negotiation with Jewish representatives.

(3) Economic situation. I expressed concern at Austria’s weak competitive position and urged that prompt steps be taken to balance budget, remove restrictions on competition and overcome obstacles to productivity drive. Raab said Cabinet would next week firm up budget which would be virtual prolongation of 1952 budget but with clear understanding that Finance Minister had power to limit expenditures to receipts. He expressed sympathy with objectives of productivity drive and suggested we should all do more to convince labor of its necessity.

(4) Bank investigation. Raab said his party had become convinced that we were right in advocating termination control of nationalized banks over Austrian industry and while there were many difficulties they would endeavor to accomplish this. Indicated they were motivated by fear Socialists might come to power and spread nationalization of industry through control of banks.

(5) Revision Nazi laws. Raab promised action on this long-standing question which has embarrassed us in AC and could be used by Russians in treaty negotiations to demonstrate Austrian lack of interest in denazification.

Raab expressed gratitude for US assistance and said we could count upon Austria to continue fight against communism.

Thompson

1. Following weeks of negotiations between the People’s Party and the Socialist Party, agreement was reached on Apr. 1 concerning the formation of a coalition government under Julius Raab, who replaced Leopold Figl as Austrian Chancellor. The new government was sworn in on Apr. 2.
2. Telegram 2978 recommended an early move on the Austrian Treaty and the convening of a new meeting of the Austrian Treaty Deputies. (663.001/4–1053)