740.00119 Council/4–2347: Telegram
The Secretary of State to the Acting Secretary of State
urgent
1533. Delsec 1466. For the President, Vandenberg, Connally and Acheson from Marshall. [42nd] CFM meeting, April 23, Bidault presiding, reviewed the agreements and disagreements arising out of the Council’s discussion of the ACC’s report and of the future political organization of Germany.28
The Council decided to refer to the Control Council for Germany as directives for action the agreements reached by CFM on the questions of demilitarization, denazification, democratization, population transfers and territorial reorganization. Disagreements on these questions were referred to the Control Council for information and study.
All delegations agreed in principle: (1) that there should be a sharing of indigenous resources in Germany and that commodities in short supply should be allocated on a basis of uniform rations, and (2) that agricultural production shall be maximized and industry reactivated on peaceful lines as soon as possible and imports into Germany shall also be used on a common basis. The unagreed points include: (1) export-import plan; (2) sharing of import deficits; (3) financial reform; (4) subjection of resources in Germany to German law; (5) occupation forces and their requirements; (6) freedom of movement; (7) control of the Ruhr; (8) annulment of the US-UK bi-zonal agreement; (9) economic decentralization and decartelization; and (10) allied control over internal allocations in Germany. The Council decided to refer all agreed and unagreed points to the Control Council for information. Molotov and Bidault asked that the unagreed points be referred to the Deputies for Germany for study after the Council adjourns. Marshall said he agreed although the differences are so fundamental that he doubted whether the Deputies [Page 384] could make much progress. Bevin opposed the suggestion for the present, and no agreement was reached.
On the questions of the level of the postwar German economy and the reparations plan, one unimportant agreement has been reached. No agreement was reached on whether the disagreed points should be referred to the Deputies for study.
In regard to the provisional political organization of Germany, all delegations agree that any decision on political organization is conditional upon the prior establishment of German economic unity. Thus, agreements on several phases of Germany’s political organization are all conditional. This entire question will continue to be studied by the Deputies as a result of an earlier Council decision.
The Council agreed that the Deputies’ report containing agreements and disagreements on the procedure for the preparation of the German Peace Treaty would be returned to them for further study. Bevin insisted, however, that agreement on parts of the Deputies’ report does not mean that parts of the procedure for a German Peace Treaty should be put into operation before there is agreement on the whole procedure.
The chairman pointed out that no agreement had been reached on other items on the Council’s agenda, including (1) Germany’s boundaries, (2) the Ruhr and the Rhineland, and (3) the US draft disarmament and demilitarization (four-power pact) treaty for Germany.
Marshall stated that the US regards very seriously what in effect is the virtual rejection by the Soviet Union of the US draft four-power treaty for the disarmament of Germany. (Text cabled Dept.) He said the additions included in the redraft of the treaty proposed by Molotov render obviously impossible any hope of concluding such a treaty at this time. The US finds it difficult he added, to understand why the USSR declines to agree to the treaty. He concluded by stating that the US is not withdrawing its proposal for such a treaty even though there is no prospect of agreement at this Council meeting.
Molotov replied that the Soviet Union does not consider the US draft satisfactory in its present form but added that the USSR agreed with the aim of a such a treaty. He repeated other arguments previously made but added nothing new. He maintained that the US refusal to discuss the proposed Soviet additions prevented discussion of the substance of the treaty.
Bevin recalled that the Council had not yet acted on the British proposal [Page 385] concerning the repatriation of German prisoners of war. The Council agreed: (1) that the occupying powers will furnish to ACC by July 1947 their plans for the repatriation to Germany of German prisoners of war now under their control or transferred to any other allied power; and (2) completion of the repatriation by December 1948.
Marshall then asked the Council to decide whether it could or could not conclude the Austrian Treaty here. (Text cabled Department). He pointed out that the main outstanding issue is the clause dealing with the disposition of German assets in Austria. He said there was no substantial difference in the views of the British, French and US delegations on this subject. These three delegations have made clear, he continued, that they cannot accept the present Soviet position and that despite their urging, no new Soviet proposal has been made. He said that unless the Soviet delegation has some concrete proposal to make which will make clear that German assets in Austria do not include assets which in justice and equity should be restored to non-Germans, we must accept the fact that further progress in the Austrian Treaty is impossible at this conference. He suggested that if agreement among the occupying powers could not be reached before September, the United Nations Assembly be asked to make recommendations.
Molotov said he would reply after studying Marshall’s statement. Bevin suggested and the Council agreed to meet again tomorrow after the Deputies for Austria attempt once again to reduce the number of unagreed clauses except the five principal unagreed clauses which would be discussed by the Ministers. Molotov pointed out, however, that the Soviet delegation had nothing new to add to a discussion of the principal treaty issues on which there is no agreement. The Council also agreed to decide at tomorrow’s session the date and place of the next Council session.
Marshall asked and the Council agreed that the US proposal to reduce the size of the occupation forces in Germany be placed on the agenda for discussion tomorrow. He recalled that the Council had not discussed this proposal because Molotov had stated at the beginning of this CFM session that he was not ready to discuss it.
The Council then adjourned.
Department please pass to Vienna as 56, Rome as 48 and Paris as 174.
Repeated to London as 185, Berlin 326.
- For the documents under discussion during this Council meeting, see the Provisional Record of Decisions, supra.↩