41. Telegram From the Embassy in Germany to the Department of State1
1585. Unified grain price. In my meeting with him today on other subjects, I cited to the Chancellor the communique issued by the French Information Minister on October 21 on the question of the organization of the EEC agricultural market.2 I recalled the position we had taken with [Page 91] the Germans on this question. Although we did not consider a UGP to be required for a successful Kennedy Round, except perhaps at the end of 1965 or the beginning of 1966, we had always attempted to make it clear that the Germans themselves must make the decision as to whether a UGP was required by the situation existing within the Common Market. In his view, would General De Gaulle’s obvious threat lead the Germans to a reappraisal of this situation?
The Chancellor replied vigorously and without hesitation that this “menace (threat) has nearly made it impossible.” He would not have made the UGP decision in any event. However, De Gaulle’s position has only served to stiffen the German position. It would have been hard for them to take this decision in the first place, however, they are now “almost bound not to.” They had committed themselves not to a favorable decision but to a declaration by Dec. 15. Germany was in no way in default on agricultural matters under the Rome Treaty. As a matter of fact they had given in to France in many ways in which they had not been required to, i.e., the agricultural regulations affecting dairying, meat, etc.
As a matter of fact, he was becoming increasingly unhappy about the development of the various Common Market regulations on agriculture. The Common Market has “glided into them as if in a traum.” It was clear that De Gaulle wanted Europe to raise everything it could for itself and to purchase only what they could not raise. He understood the problem which the various regulations had created and would continue to create for us. It was, moreover, unreasonable to ask Germany to make a decision in 1964 as to the price of wheat in 1966. He could not take such a decision until after the German elections. It would be difficult then but the “great pressure” (i.e. political) would be off. He appreciated the U.S. position in this matter to the effect that it was not necessary to reach a grain price decision until that time. I did not attempt further to clarify our position.
Comment: The Chancellor’s expression of intent with respect to whether or not he would accede to De Gaulle’s threat to withdraw from the EEC unless there is a UGP was strong and clear. This matter has, according to an assistant, been discussed with the Cabinet since the French announcement; however, no vote was taken. The Chancellor had taken the same position in the Cabinet meeting that he had taken with me. My informant cautioned me, however, that those who might be inclined to accede to de Gaulle’s demands had not yet had their innings and the position Erhard has taken may not be final. Even with me, he was somewhat equivocal, i.e. his words were “almost bound not to.” I think it extremely important that Erhard’s preliminary reactions on this question be held in great confidence, since it would obviously be embarrassing to him and to us if his views became known prematurely and through US channels. I must admit that I have perhaps been overly pessimistic in [Page 92] my reporting about Erhard’s being able to make an about face by accepting UGP after the election. Despite the political difficulties this would cause him, he obviously considers this less onerous than the loss of votes he would suffer in the event of a decision now. The US position as he understands it is an important element in his tentative decision. If we have any desire to change his decision, this would be the time to change or clarify our position.