301. Letter From the Ambassador to Austria (Matthews) to the Assistant Secretary of State for European Affairs (Elbrick)0

Dear Burke : This is a lovely little country, the people have great charm and at times have shown courage, notably under the Occupation and during the Hungarian revolution. They have many other admirable qualities. On the other hand, in spite of the long governing history of the Hapsburg Empire, they are at times unbelievably naive with regard to the outside world and, particularly since their extraordinary prosperity since 1951, are prone to indulge in high flights of fanciful wishful thinking whether it be in the fields of East-West bridge-building or making Vienna the capital of Europe without hotels or other matters. The tradition and art of compromise is strong and the employment of intrigue, sometimes subtle and sometimes transparent, is not foreign to their nature.

With this by way of preface, I feel the time has come to write you personally of a disturbing trend away from the earlier State Treaty policy of strict military neutrality with strong and open non-military ties with the West. While I was not, of course, here at the time, it is my impression that when the Treaty was signed in May 1955, Austrian impressions of the harshness of Soviet occupation and Soviet responsibility for the nine-year delay in giving the country its freedom were still very vivid. The support given Austria by the three Western powers, especially the United States, and the role played by Mutual Aid were very fresh in Austrian consciousness. Inevitably with the passage of time, the “correct” Soviet behavior (with the notable exception of the Hungarian revolution period) and the country’s burgeoning prosperity, far exceeding anything since pre-World War I, and the growing Austrian pride and confidence (if not overconfidence) in themselves and in their future, the recent past has become hazy and blurred. Especially in the mind of the ailing Chancellor, though by no means confined to him or his party, is the belief that Austrian skill and behavior were primarily responsible for the ultimate conclusion of the State Treaty, and while the Soviets were slow in agreeing to it, that should not be held too much against their newfound Moscow friends. This 180-degree change in Austrian attitude is perhaps best typified by Arab’s public statement at the Moscow airport on July 21, 1958: “We know that we concluded the State Treaty mainly thanks to the Soviet Union”, and his emphasis that Austrian neutrality “is not simply a limited but an unlimited neutrality”. To this he [Page 783] added his gratuitous and completely distorted public reference to his “protest” against U.S. Air Force overflights. There are many other evidences of this newfound era of Soviet-Austrian cordiality: The steady stream of two-way visits, four Soviet Ministers since May and the pending visits—invitations already accepted—of President Schaerf and Defense Minister Graf to Moscow. There was further Schaerf’s statement in May that Austrian neutrality is “absolute” and a “fundamental rejection of any military alliance, jealous protection of political independence, avoidance of a one-sided stand in foreign power conflicts”, to which he added that at no time since conclusion of the State Treaty have the Soviets tried to influence Austria’s attitude. Perhaps the most recent and startling example is Vice Chancellor Pittermann’s statement to David Wainhouse that the Austrian people (which I do not believe) are beginning to say that the Soviet has given Austria ten million dollars (through the recent dubious oil deal) whereas the United States is taking away five million dollars for the persecutee Jewish claimants. (Airgram G–120 of September 12).1 There is likewise Raab’s expected early visit to Prague to see President Siroky, his decline of Siroky’s earlier invitation being thereby reversed, almost solely because the Russians had asked him to, and for the purpose, to quote Raab’s words, “of breaking down the iron curtain”. To a growing belief that Russians are human, decent responsible people with whom one can do business, there is added the constant pressure—especially with falling exports—of Austrian industrialists who have glowing illusions of exports to the East, whether it be to China or to Russia and the European satellites. And Raab himself reportedly said regarding a possible Soviet credit: if Nasser could accept help from both East and West, Austria could do the same. (My Airgram G–l of July 3.)2

Along with this new discovery of Soviet respectability there is a certain fear and timidity of the consequences of offending the Russians. A very active and able Soviet ambassador is busily cultivating both the stick and the carrot theory; while flattering Raab in particular as the true statesman of Europe, he makes clear to others the dangers of too close association with the West. As set forth in my Airgram G–53 of August 7 and in Airgram G–96 of August 29,3 there is a disturbing tendency on the part of Austrian officials to think of Austria’s position vis-à-vis [Page 784] Moscow as equivalent to that of Finland. (The very friendly Minister of Education has privately admitted to me his worry over this tendency which he says is constantly fostered by the Russians with Austria and in reverse with the Finns, i.e., “why don’t you behave like Austria.”) If the belief really takes hold, we can expect future Austrian policies and actions, whether in direct relations with the US, in the UN or in other international bodies, to become increasingly timid with increasing reluctance to side against the Soviet Union.

On the other side of the picture, I should add that these trends and tendencies are so far stronger within the government and in the governing classes than in the country at large. The people, who deserve perhaps a better government, I think are basically under far less self-delusion with regard to the Soviet dangers and Soviet ruthlessness than their leaders. Furthermore, whatever their hopes for trade with the East and stringless Soviet concessions, the financial and business community is basically conscious of their need for close Western ties and markets. As they increasingly equate the Soviet with the West, however, on the moral, economic, political and military planes, they will take the West for granted and make concessions to the East unless and until they are made to face realities.

What does this all add up to in terms of U.S. policy toward Austria? I do not think for a moment that we should change our policy of granting from time to time through various banking institutions—World Bank, Ex-Im Bank, private banks, etc.—the investment capital which Austria needs for its continued development and prosperity. I do not think that we should change our policy of providing the Austrian army with the programmed equipment and matériel. There may, however, be occasions when we should drag our feet a little and when we should adopt a more questioning attitude. We should, I think, take occasion to ask questions and to let our views be known when Austria seems to be going farther to the East than necessary or desirable. This we do here, and this I hope the Department will do with Platzer. The latter is a very able and pleasant Austrian representative, and his views are highly regarded here. It would be useful from time to time, though I know how busy you are, if you or Fritz Jandrey could raise some questions with him in addition to the routine weekly meetings he has with WE on specific matters. I think when Minister Figl calls on the Secretary on September 25, it would be a very unfortunate omission if the latter did not mention Figl’s failure to consult us beforehand, in view of his prior assurances, on Austrian adherence to the Danube Convention. (Personally I cannot get too excited over the practical effect of such adherence, though I see no benefits to Austria. I do think failure to call the pleasant but timid little Figl’s attention to the violation of an assurance would be a great mistake. While the issue itself may be water over the dam, to ignore [Page 785] it will make him much more likely to ignore other commitments.) In fact, if we are to arrest this general trend towards equating the U.S. and Soviet even on the moral plane, I feel strongly the Secretary should make some general reference to his unhappiness concerning it. (Fred Chapin can get you up a good briefing paper.)

In other words, the era of gratitude—that shortest lived of all human emotions—for past favors and assistance has come to an end. The sensitive nerve of self-interest and future expectations, both good and bad, should be probed. Austria should not take the U.S. for granted; uncertainty in their minds will be salutary.

This is too long a letter with which to burden a busy man, but I have felt the problem is of sufficient importance to bring to your attention if we are to avoid future disappointments in this corner of Central Europe.

With all good wishes and best of luck,

Very sincerely,

  1. Source: Department of State, Central Files, 863.10/9–1758. Secret; Limit Distribution; Official-Informal.
  2. G–120 from Vienna reported a conversation between Wainhouse and Pittermann of September 10 in which several subjects were discussed, among them compensation of persecutees under Article 26 of the Austrian State Treaty. (Ibid., 763.00/9–1258)
  3. G–1 from Vienna reported a discussion between Matthews and Kreisky in which the major topic was the Soviet offer to extend financial credit to Austria. (Ibid., 863.10/7–358)
  4. Neither printed. (Ibid., 863.10/8–758 and 863.10/8–2958)