Foreign Relations of the United States, 1955–1957, Western Europe and Canada, Volume XXVII

40. Memorandum of a Conversation, Cabinet Room, White House, Washington, February 26, 1957, 2:30 p.m.¹

Washington, February 26, 1957, 2:30 p.m.

PRESENT

• (U.S.)—The President of the United States
  • Secretary of State Dulles
  • Under Secretary of State Herter
  • Hon. C. Burke Elbrick, Assistant Secretary of State for European Affairs
  • Ambassador C. Douglas Dillon
  • Ambassador Amory Houghton
  • Mr. James Hagerty
  • General A. Goodpaster
  • Lt. Colonel Vernon A. Walters
• (France)—Premier Guy Mollet
  • Foreign Minister Christian Pineau
  • Ambassador Herve Alphand
  • Ambassador Louis Joxe
  • M. Pierre Baraduc
  • M. Jean Daridan
  • M. Emile Noel
  • M. Paul Parpais

The President opened the meeting by asking whether, apart from the United Nations questions, there were any other thoughts the French wished to bring up concerning NATO, North Africa or any other matters of general interest.

Mr. Mollet said that he had discussed the European problem² and that there were other matters, such as the common market, Eurafrica and others.

Mr. Pineau then said that while the nations taking part in the common market were members of the OEEC, there would, of course, be more limitations for OEEC countries not participating in the common market. Mr. Pineau said that the common market had been decided upon by the six nations and would include all their economic, industrial and agricultural activities. In a recent conference of Prime Ministers and Foreign Ministers of the six countries participating,³ it had been decided to include their overseas territories as well. This referred to Belgium, Holland, Italy and France. They had moved far towards the common market and had agreed to create a common investment fund financed by the six countries for overseas investment.

He wishes to emphasize that this would in no way limit or preclude private investment. General agreement had been reached on all of the problems of the common market and a period of adaptation had been chosen which was quite long because of the grave problems which the common market would create for the economies of all six countries. This period ran up to 15 years for the full implementation of the common market as it was now conceived.

Mr. Pineau said Great Britain was still interested in the discussions and had proposed some months ago in the OEEC that a free exchange area be set up for trade between the six nations and Great Britain. The reason why the British were proposing the free exchange area (and this was an important element), was because they could not give their outright adherence to it (common market) for two reasons: they could not agree to the introduction of agricultural products into the free exchange area because of the bilateral arrangements which they have with Commonwealth countries; outside tariffs were a problem which would have to be worked out, particularly with relation to those applying to Great Britain as her relationship with the Commonwealth was quite different from that of the six nations with their overseas territories, and it was for this reason that they could not accept entrance into the common market.

Technical problems set aside, there were two fundamental differences and for this reason it was necessary to set up two different organizations—the common market and the free exchange area. These must, in consequence, be discussed separately. It had been agreed in principle that discussions with other nations would take place within the OEEC but as there were nations in OEEC which did not propose to enter either the common market or the free exchange area, the French, in order to clear the ground, had proposed that all problems relating to Great Britain’s participation in the implementation of the common market,Euratom or the Coal Steel Community be discussed beforehand in the Western European Union.

That was all Mr. Pineau had to say concerning the problem of Great Britain and the six countries. It was a delicate one, and undoubtedly interested the United States.

The six nations had decided to solve the problem of a common outside tariff after lengthy discussions. This had been done as far as the six nations were concerned. The problem, however, was not settled insofar as the free exchange area was concerned. On that, discussions had just been started. Insofar as the common tariff was concerned, the six countries at the end of the 15 year period would constitute, so to speak, one country in relation to others. There was every reason to believe that normal commercial exchanges between the six nations and other countries would not be changed. On the contrary, they might well be improved as a result of the lowering of customs duties in some cases. In conclusion he could say that they felt they had solved the problem of the common market and had gone far in settling relationships in the six nations and the free exchange area. He likewise felt that the progress which had been made in the common market, instead of pushing Great Britain farther away, actually tended to develop closer collaboration between Great Britain and the common market.

The President then thanked Mr. Pineau for his explanation and said that he felt that the day this common market became a reality would be one of the finest days in the history of the free world, perhaps even more so than winning the war. Before they went on to other subjects, he would like to get in one statement—he understood that Mr. Pineau was to meet Ambassador Eban⁴ and he would like to repeat what he had said in the morning.⁵ He couldn’t believe there was anything more important than to get Israel to withdraw so we could support her future position and she would be able to get full rights in that area. As a corollary, we would see that other nations would act in accord with their obligations, that is to say Egypt, the Canal, etc. Whatever Mr. Pineau could do to convince Mr. Eban of this need would be a service to all.

The President asked whether Mr. Pineau had anything special he wished to bring up at this time. The Secretary of State then asked whether Mr. Pineau had read the Memorandum.⁶ Mr. Pineau said he had just begun to read it and he had two main remarks concerning the text; the first was that he felt that if we wished to present a solution acceptable to Israel, it would be advantageous to make the least possible mention of the armistice agreement. Mr. Dulles then said that he had just talked to Mr. Eban⁷ and expressed concern regarding the fact that there were some indications that they wished to consider the armistice agreement as null and void. If they took this position, a serious problem would arise in that this would restore belligerency to full vigor and it would be difficult to assert rights of innocent passage into the Straits of Aqaba. He did not know where we would be in regard to the boundaries which had been fixed by the armistice agreement. These were not political but de facto, and if the armistice agreement was considered null there would be only the 1947 agreement⁸ which the Arabs wanted and Israel did not. Mr. Eban was still talking with our legal advisers who saw dangers in considering the armistice agreement void. He agreed with Mr. Pineau, however, to the extent that the least reference to the armistice agreement in the Memorandum the more palatable it would be to Israel.

There was some discussion regarding the wording which was finally agreed to.

Mr. Pineau said he had his second point he wished to make. He thought we ought to give more emphasis to our desire to take advantage of the period of transition for peace negotiations which should be undertaken as soon as possible so as to give Israel the impression we were less trying to consolidate a past situation and more trying to create a new situation.

There was some further discussion regarding wording revolving around the words “permanent peaceful settlement” and finally the wording was agreed.

Mr. Pineau then said that he did not believe it would be wise to give Eban the impression that they were presenting him with a common ultimatum. If not, his task of rapprochement would be made even more difficult. He would like to see the President and the Secretary again after his meeting with Eban.⁹ He felt that if Eban wanted to change a few words here and there that would not alter the substance, he should have a little latitude.

Prime Minister Mollet then said he felt it would be useful if Secretary Dulles would brief Mr. Pineau regarding his talk with Eban. Mr. Dulles then said that Eban indicated that he could see a way to solve the problem for the Gulf of Aqaba along the lines they had discussed on Saturday and Sunday¹⁰ but that was contingent upon an agreement, or common understanding, that the armistice still prevails and that there was no return to a state of belligerency. If there were, the right of innocent passage would disappear. With regard to Gaza he was disappointed with the results of his talks yesterday with Hammarskjold¹¹ who continued to reiterate the legal position of Egypt in the Gaza Strip and that he (Hammarskjold) had no legal right to deny Egypt’s right of occupancy. Eban read the Secretary a statement that Hammarskjold had given him the previous night in this respect, and this statement seemed to the Secretary to be quite correct. Eban felt, however, it was negative and had asked Hammarskjold not to publish the statement. The Secretary agreed with Eban that it would have a bad effect on the situation in Israel if it were published. At that point, Eban suggested the possibility of a solution now covering Aqaba and to reserve for future consideration the problem of Gaza. Secretary Dulles did not consider this possibility from a legal standpoint. He saw no solution except for an Israeli withdrawal from both places. The Secretary told Eban that in the talks he had had with the French and the British on this matter that the French had come up with some new ideas and he hoped there would be an opportunity for Mr. Pineau to discuss them with Eban. He had not gone into the details of Pineau’s formula as he understood that the latter had a tentative appointment at four o’clock with Eban to present his ideas.¹²

At this point there was some discussion as to whether Mr. Mollet should go to the talks with Eban. He felt, however, that if it appeared that he had broken off his conversations with the President to go to this appointment, it would present their discussion in a false light. Mr. Pineau then said he might see Hammarskjold two days later to see what could be worked out at U.N. level. Secretary Dulles then said that unless we can have considerable assurance of progress along these lines he felt that a resolution would be adopted in the General Assembly the following day. Mr. Pineau said he would see what could be done.

The President then asked if there were any other matters, such as NATO, that the French wished to take up. Mr. Pineau then said he had some thoughts concerning European defense. Because of the small amount of time available he would sum up the French position on the problem that concerned them the most now, that is to say the changes which Great Britain desires to make in her military structure and in her occupation forces, since information available to the French indicates that she desires to make a one-third reduction in her ground forces and to reduce her air forces by half. Proposals along these lines by the British bring to mind certain thoughts. First, it is not difficult to conceive that if a member of NATO or WEU should effect changes of this type in the structure of her armed forces, it would be quite possible that others might wish to adopt similar changes. Essentially, the French felt that it was up to the Supreme Commander, General Norstad, to say what the new structure should be and what the tasks should be for all concerned. Today in London, where this problem was being taken up at a WEU meeting,¹³ the French position on this matter was the same as that of the Germans and other members. It was impossible to make a decision on a matter like this without hearing the opinion of the military technicians. The second concern felt by the French was that it seemed dangerous to them, even from the psychological point of view, to cut forces in Europe below a certain level, no matter how much you might increase their fire power.

Additionally, with regard to Germany, it was difficult to see how we could obtain from her Parliament the appropriations and military legislation to implement her defense program if at the same time Great Britain was cutting her forces. Further, we might give the Russians the impression that we were orienting ourselves towards peripheral defense. The effect would be to put certain temptations before them in Central Europe and furthermore if there was considerable reduction in forces, and conventional weapons were replaced by atomic weapons, we might be put in the situation of supreme danger where if an incident of minor proportions occurred, either we would have to do nothing or resort to general atomic war. For these reasons, the French felt that it was essential that this matter be thoroughly studied within NATO and that any changes that were to be made should be made with the general agreement of the members. The French are well aware of the financial difficulties of Great Britain and can well understand their desire to reduce military expenditures but they felt it was important to keep an appropriate balance between conventional forces and nuclear forces in Europe.

The President said that he had not talked to any of the British concerning their reduction plans since they had been announced but they had told him they must do something to avoid the drain of foreign exchange to avoid a collapse. That meant a reduction of their expenses throughout the world. Of these, the biggest was the cost of the troops in Germany. He agreed that no movement of troops ought to be made without two-way consultation nor should there be any change in character without a full conference with SACEUR and, where necessary, with the NATO Council. No one party of the Treaty ought to take unilateral action regarding its forces until it had explored the matter with the other partners to see if there was not a chance that the others might make good the deficit. Back in 1950 we had hoped that German troops would become available in sufficient size and promptly enough so that the burden of other nations might be reduced. Our own troops had gone over at that time as an emergency measure to give the French, Germans and others time to get their forces established. None of this in any way impaired the truth of what the French had been saying. There should be a full conference between the interested parties and the commanders.

Secretary Dulles then said that the U.K. had a special obligation in their undertaking with the WEU.

The President then said that Germany had had no defense troops since the war and consequently not had these costs.

Secretary Dulles said that they had agreed to make a substantial contribution to cover the foreign exchange costs of maintaining the British forces in Germany.

Mr. Elbrick said that negotiations were underway but that generally they had agreed to pay some two-thirds of the costs, which was a lot of money.

The President then inquired whether the French had any particular proposal to make on this and Mr. Pineau replied that they did not reject the principle of economies on military expenditures but they only wished that these economies be effected in agreement with the other partners rather than on a unilateral basis. The President said that he agreed with this. Mr. Pineau said that if General Norstad could propose some plan which would allow the British to make some reduction and still ensure effective defense, he would be delighted. The President said this was a serious problem for us also as we had obligations all around the world from Korea to Great Britain.

Mr. Pineau said that there was another aspect to European security that he had brought up with the Secretary of State in January¹⁴ and that problem related to disarmament and the political problems involved in German reunification. There had been discussions on this between U.S., Great Britain, France and Germany. He did not enter into the details of the disarmament plan, particularly in the absence of his friend Jules Moch, but he felt that when this matter is examined by the Sub-committee in the United Nations and perhaps later at the Ministerial level, there will be a number of Soviet proposals to neutralize Germany or part of Europe. This would involve considerable danger resulting from the pressure not only on German public opinion but on public opinion in Western Europe. He felt it was important that the Western powers have a common position and that none of them become committed to separate discussions upon neutralization of Germany. He felt this problem might come up in one or two months and he believed it would be useful to study it in advance.

The President said that it would be difficult for us to make pronouncements concerning German neutrality without German agreement. He felt we should avoid the subject and not let ourselves get involved with the Soviets on matters such as disarmament or arms reduction.

Secretary Dulles then said there was one question he would like to raise. The Soviets had suggested that the Foreign Ministers attend the disarmament meeting in London.¹⁵ In our view, this would merely serve to give greater propaganda value to the Soviet proposals which would be introduced without any serious purpose other than propaganda value. In our view the Foreign Ministers should not be present.

Mr. Pineau then said he wanted to answer the President’s concern regarding the association of Germany in the conversations. He felt these conversations were useful as Germany was not a member of the United Nations but through them the Germans could be kept up on everything that was going on.

Secretary Dulles then said he wanted to say a word to the President regarding the matter which he felt of great importance in the conduct of foreign policy and that was the great understanding between France and Germany. He wanted to mention the part played by the French Government, taking into account the preoccupations of the German Government, and showing sympathetic understanding for them. He felt this was something “terrifically important” and added that the French Government deserves great credit for what they have done.

Mr. Mollet then said he wanted to add a word concerning what the Secretary had said—that at the last meeting of the six Prime Ministers and Foreign Ministers he had had a long tête-à-tête conversation with Chancellor Adenauer in which they had talked freely about all problems and he could say that Chancellor Adenauer saw these problems in exactly the same fashion as they did and felt that, even more than France, they were representing Europe in this respect.

The President then said that the solution of the Saar problem had been a tremendous step forward.¹⁶

Mr. Mollet then said that a communiqué would have to be issued the following day and he wondered if some members of the delegations could not start working on this.¹⁷ To this the President was quite agreeable. He also expressed the hope that complete secrecy would be observed regarding the meeting with Mr. Eban as it was particularly important that the impression not be given that Israel was being confronted with an ultimatum by the other two powers.

It was then agreed that those present at the conference would meet again in the Cabinet Room at the White House at 11:15 the following morning.¹⁸

1. Source: Department of State, Secretary’s Memoranda of Conversation: Lot 64 D 199. Secret. Drafted by Walters. For a memorandum of the portion of conversation on European integration, see vol. IV, p. 529.
2. Reference is presumably to Mollet’s private conversation with President Eisenhower that morning; see Document 38.
3. Representatives of the Federal Republic of Germany, France, Italy, Belgium, Luxembourg, and the Netherlands met in Paris, February 18–20.
4. Abba Eban, Israeli Ambassador to the United States. Regarding his conversation with Pineau, see vol. XVII, p. 300, footnote 2.
5. No record of this conversation was kept; see Document 38.
6. The memorandum by Secretary Dulles, February 26, on the Israeli withdrawal from Suez, is printed in vol. XVII, p. 298.
7. The memorandum of Dulles’ conversation with Eban on February 26 is ibid., p. 291.
8. Reference is presumably to the partition plan for Palestine adopted by the U.N. General Assembly on November 29, 1947.
9. A memorandum of the conversation between Dulles and Pineau at 4 p.m. on February 27 is in vol. XVII, p. 305.
10. February 24–25; the memorandum of the conversation between Dulles and Eban on February 24 at 3:30 p.m. and the memorandum of their telephone conversation at 5:34 on February 25 are ibid, pp. 254 and 273, respectively.
11. The memorandum of the telephone conversation between Dulles and Dag Hammarskjold, Secretary-General of the United Nations, on February 25 at 5:45 p.m., is ibid., p. 274.
12. A memorandum of the conversation between Eban and Dulles, February 26, is ibid., p. 291.
13. A Ministerial meeting of the Council of the WEU was held in London, February
14. A memorandum of the conversation between Pineau and the Secretary of State, January 11, is printed in vol. XX, p. 448.
15. The Subcommittee of the U.N. Disarmament Commission met in London, March 18–September 6, 1957. Foreign Ministers did not attend.
16. Franco-German treaties on the Saar and related questions came into force on January 1, 1957.
17. For text of the communiqué, February 28, see American Foreign Policy: Current Documents, 1957, pp. 607–609.
18. A memorandum of this conversation, which was concerned with the Middle East question, is in Department of State, Secretary’s Memoranda of Conversation: Lot 64 D 199.