Foreign Relations of the United States, 1950, The Near East, South Asia, and Africa, Volume V

S/S–NCS Files: Lot 63D351: NCS 42¹

Memorandum by the Acting Secretary of State to the Executive Secretary of the National Security Council (Lay)²

[Extract]³

top secret

Washington, September 19, 1950.

Subject: Second Progress Report on NSC 42/1, “United States Objectives with Respect to Greece and Turkey to Counter Soviet Threats to United States Security.”⁴

NSC 42/1 was approved as governmental policy on March 23, 1949, on the basis of the considerations set forth in NSC 5/4 of June 3, 1948.⁵ It is requested that this report, as of August 25, 1950, be circulated to members of the Council for their information.

I Policy Implementation—Greece

Military Aid

By the end of fiscal 1950, approximately $458.7 million had been committed in equipping, maintaining, advising and training the Greek armed forces under the program of aid to Greece and Turkey inaugurated in 1947, about $112.9 million of this sum having been committed during fiscal 1950. Guerrillas in Greece now number about 300, as compared to a one-time high of 28,000 and thus constitute only a normal and insignificant police problem. With the defeat of the guerrilla movement, the current specific objectives of the military aid program are to provide certain basic capital equipment, replacements, spares and general supplies for Greek forces “of a size and composition sufficient (a) to maintain internal security, (b) to deter a resumption of satellite-based guerrilla activity, and (c) in the event of such resumption, to provide adequate resistance until a general mobilization could be completed and additional supplies furnished.”

Pursuant to these objectives, it is now contemplated that $52.5 million will be allocated to Greece out of the $131,500,000 authorized for military aid to Greece, Turkey and Iran under Title II of the Mutual Defense Assistance Act of 1950,⁶ and it is likely that this amount will be substantially increased by supplementary legislation. Additional assistance for the Greek military establishment will likewise be afforded by about $36 million for the procurement of commonuse items under the Greek ECA program.

To effect savings and to foster Greek economic rehabilitation, a program was initiated following the defeat of the guerrilla movement for the reduction of the Greek armed forces, exclusive of the Gendarmerie, from their top strength level of 217,000 in October 1949 to a target figure of 124,000 by December 31, 1950, with provision being made for 90-day remobilization to a strength of 147,000 in the event of a significant resumption of guerrilla activities. This process of reduction, which had brought the Greek forces down to a level of 135,400 on May 31, 1950, has been arrested as a result of the Korean aggression and consequent Balkan uncertainties.

The Joint United States Military Advisory and Planning Group in Greece (JUSMAPG), which numbered 527 persons as of June 30, 1949, had been reduced to 266 persons (authorized by Joint Chiefs of Staff) as of June 30, 1950, and its Commander, Lieutenant General James A. Van Fleet, has been succeeded by Major General Reuben E. Jenkins.⁷ The personnel requirements of the Military Group are currently under review.

Apart from the danger of direct military aggression by the USSR, the external threat to Greece lies in the Bulgarian and Albanian Armies and in the Greek guerrilla forces concentrated in those countries. It is understood that the Bulgarian forces number between 85,000–150,000 well equipped and well trained men with capability of expansion of a mobilized strength of about 600,000 trained men. Albanian forces are understood to number some 45,000 men of undetermined fighting capabilities. Combat-fit Greek guerrillas in Bulgaria are estimated at between 3,000 and 12,000 and in Albania at between 300 and 3,000. There are no known Soviet combat organizations in either Bulgaria or Albania, although it is estimated that there are at least 2,000 Soviet military “technicians” in Bulgaria and a much lesser number in Albania. Intelligence reports provide no concrete evidence of imminent military action by Bulgaria or Albania against Greece (or against Yugoslavia, which would likewise gravely imperil the security of Greece). On the other hand, disturbing factors are (a) continued minor frontier provocations against Greece, (b) reports of Soviet stock-piling and of somewhat unusual troop movements in Bulgaria, and (c) persistent Cominform propaganda designed to stimulate a war psychosis in Bulgaria and to depict the “Athens-Belgrade Axis” as an instrument of aggressive Anglo-American policy.

In light of the foregoing, a reexamination is being made of the capabilities of the Greek Armed forces to meet the various possibilities of hostile action with a view to determining the advisability of making changes in the strength, organization, and equipment of those forces wih the resulting changes which would be reflected in our military aid program as to size, composition, and priority.

Economic Aid

In fiscal 1950 Greece received $158.3 million of direct ECA aid and drawing rights, as adjusted, of $127.5 million, or a total of $283.8 million. For fiscal 1951, direct aid is likely to be between $100 million and $120 million, and Greece has an initial position in the European Payments Union of $115 million. This would accordingly represent a total of between $215 million and $235 million.

With the economic aid given Greece and the end of large-scale guerrilla warfare, the Greek economy was kept on a reasonably even keel during fiscal 1950 and the reconstruction of the nation’s capital assets continued. With peace restored and the refugees back in their villages, there is a real increase in acreage of important crops, and farm production should exceed that of the pre-war years. Industrial production is at about pre-war levels, but neither industrial nor farm output are as yet adequate for a self-sustaining economy. Previously it had been estimated that the fiscal year 1951 budget operating deficit would be reduced to $40 million as compared to $130 million in fiscal year 1950, but the proposed increasing of the armed forces would impose an additional budgetary load of approximately $30 million.

Fear generated by the warfare in Korea resulted in a heavy demand for gold sovereigns for about three weeks and some increase in the price level, a condition which if continued could retard Greek recovery. However, it will be noted that the demand for gold sovereigns and price levels will inevitably remain closely related to international developments in face of what have been steadily improving economic conditions in Greece. Two other basic difficulties are the problem of expanding foreign markets for Greek tobacco and the problem of industrial development, particularly in the Athens-Piraeus area, to provide productive employment. The prospect of large stocks of tobacco remaining unsold presents both an internal economic and political problem for which there is no easy solution. However, the matter is being given serious study. An agreement concluded in July between ECA and the Greek Government for a major electric power development project will provide an essential basis for industrial expansion. However, despite these developments, it is unlikely that Greece will have made sufficient progress to be able to stand on its own economic feet by June 30, 1952.

Greek Foreign Relations

The United States has continued to lend all feasible political support to Greece in the United Nations forum and through direct diplomatic action.

One vexing residual problem of the Greek guerrilla warfare has been the failure of the communist countries of eastern Europe to act upon the General Assembly resolutions calling for the repatriation of some 20,000 children removed from Greece by the guerrilla forces. We have continued to exert pressure for the return of these children by all available means. A strong note on the subject was, for example, addressed to the United Nations Secretary General on May 30,⁸ and the matter has been repeatedly taken up direct with the Yugoslav authorities. While the problem is essentially humanitarian and the outlook for its solution discouraging, with the possible exception of Yugoslavia, our action in this matter serves at least as a powerful counterweight to Soviet propaganda charges regarding American “imperialism” in Greece, and it may therefore be considered indirectly helpful to Greek and United States security interests.

Of more direct effect from the viewpoint of security is the continued vigilance of the United Nations Special Committee on the Balkans (UNSCOB), which will again report to the Fifth General Assembly in the fall on the threats to the political independence and territorial integrity of Greece. The usefulness of UNSCOB, even in the absence of guerrilla activities, was demonstrated by its special report of July 19,⁹ which was prepared on United States initiative and which exposed the falsity of the Cominform propaganda campaign regarding alleged Greek aggressive designs sponsored by the Anglo-Americans. Plans for putting UNSCOB on a stand-by basis and for further reducing, or eliminating, the observer corps in Greece have been indefinitely postponed as a consequence of the Korean development.

The Korean events highlight the community of Greek and Yugoslav security interests under the potential threat of similar Cominform military action against either or both states. Tension between the two countries which relaxed progressively after Yugoslavia’s break with the Cominform, turned into a definite promise of rapprochement with the advent to power of the Plastiras Government in Greece in April. Unfortunately, preliminary steps encouraged by the United States for an exchange of ministers and the resumption of economic relations were frustrated by subsequent misunderstanding over the issue of the small Slavic minority in northern Greece. We shall continue when suitable opportunities occur to endeavor to liquidate the ensuing impasse through diplomatic action at Belgrade and Athens.

The Greeks continue to seek inclusion in the Atlantic Pact or some similar regional arrangement. While we have avoided any expressed or implied commitment in this respect, consideration is being given to the effects of the inclusion or indirect association of Greece, along with Turkey, in the Pact. Meanwhile we have taken every appropriate opportunity to assure Greece of our continued support to quiet their fears. For example, on May 19, at the termination of the London Foreign Ministers’ Conference, the Secretary of State reiterated American determination to safeguard the independence and territorial integrity of Greece, Turkey and Iran,¹⁰ and reference to the same theme was made in the President’s message of July 19 to Congress on Korea.¹¹ The Greeks have likewise derived great encouragement from the United States and United Nations action in Korea, which they have offered to support by providing six transport planes with crews.

Greek Internal Situation

National elections held in Greece on March 5 showed a distinct trend of sentiment toward the center and left-center, but political machinations nevertheless led to the setting up of a narrow Government headed by the Liberal leader, Mr. Sophocles Venizelos. While centrist in appearance, this Government was still dependent on rightwing parliamentary support. Under pressure from Ambassador Grady, the Venizelos Cabinet was succeeded on April 15 by a broader and presumably more representative and effective coalition headed by the moderate leftist, General Nicholas Plastiras. This development was generally well received in Greece and by Western opinion. While the Plastiras Government registered some progress along the lines advocated by American advisers, notably in the economic field, its general record of accomplishment was not impressive. In some respects its actions and attitude have facilitated communist resurgence within Greece. Disintegration within the coalition gradually set in due to the traditional centrifugal forces of Greek politics and divergencies between the principal coalition leaders, leading to the Government’s fall on August 18. A new Government was formed by Venizelos on August 21 drawn only from the Liberal party but with the promise of expanding it into a more widely based coalition upon the return of principal leaders abroad at that time.

The Greek Communist Party remains illegal, but many of its members have benefited by a program of broad though not total amnesty designed to promote internal pacification, to correct individual injustices, to relieve congestion in the political detention centers, and generally to eliminate grounds for legitimate criticism of Greek judicial practices. Their freedom thus regained, these communists are now active in reforming the Party cadres and in their endeavors, through the popular-front technique, to foment unrest, to win control of the trade unions, and to capture certain municipal Governments in local elections scheduled for September 3. Although the situation is not yet alarming, the communist internal effort in Greece is meeting with some success and will always be a threat in this country of abysmally low living standards. This and the persistent problem of governmental efficiency and stability in Greece thus require close and continuing American attention.

. . . . . . . . . . . . . .

III. Policy Evaluation

The American policies with respect to Greece and Turkey, inaugurated in 1947 and aiming at the objectives formulated in NSC 42/1, have so far saved Greece from otherwise certain collapse and have enabled Turkey appreciably to strengthen its defense posture. The Greek and Turkish economies have been sustained and reenforced. Turkey has made marked progress towards a fuller democracy, and the breakdown of democratic government in Greece has been averted. The Soviet threat which hung over these two countries and cast its shadow over the broader neighboring areas has thus been held in check. It has even been pushed back through the not unrelated defection of Yugoslavia. Nevertheless the threat, if somewhat blunted, is still poised, and its balance has been rendered more precarious by the aggression against the Republic of Korea.

Both the improved situation of Greece and Turkey and the new world situation arising from the aggression in Korea call for reappraisal of United States objectives and policies with respect to Greece and Turkey. There are possibly new opportunities to be exploited; there are certainly new questions to be answered.

NSC 42/1 was prepared at a time when Greece was still in the throes of guerrilla warfare, and it was addressed primarily to the problem of preventing the domination of Greece and Turkey by communist pressures short of outright aggression. This problem has been met successfully with the help of existing United States support policies and can, it would seem, be kept under control by intelligent projection of these policies into the future. On the other hand, the willingness of the USSR to resort to force in Korea, at least indirectly, makes clear the possibility of similar outright aggression, which might take one or more of several forms, against Greece and Turkey.

Under these circumstances a new series of problems has arisen which are now under consideration. Among them are: (a) the possibilities and means of discouraging in advance Soviet or satellite aggression against Greece and Turkey; (b) the means of countering such aggression if it occurs; (c) the integration of United States planning regarding Greece and Turkey with similar planning regarding other countries of the same area, such as Yugoslavia and Iran, which have closely related security problems; (d) the integration of United States planning regarding this area with that of the United Kingdom and other North Atlantic Pact members.

James E. Webb

1. Lot 63 D 351 is a serial master file of the National Security Council documents and correspondence and related Department of State memoranda for the years 1947–1961, as maintained by the Executive Secretariat of the Department of State.
2. National Security Council (NSC) Action Number 366 taken at the 69th meeting of the NSC on October 12 “noted and discussed” the progress report transmitted by this memorandum, “with particular reference to the desirability of assisting the Greek Army in improving its ability to defend against external aggression;” noted that the NSC Staff was preparing a new report on U.S. policy toward Greece, which would take account of the above point; and agreed that the NSC Staff should prepare a new report on U.S. policy toward Turkey (Committee Secretariat Staff, S/S–NSC (Miscellaneous) Files, Lot 66D95, Record of Actions by the National Security Council, 1950).
3. For the remainder of this memorandum, see p. 1317.
4. Foreign Relations, 1949, vol. vi, p. 269.
5. Document NSC 5/4, June 3, 1948, “The Position of the U.S. with Respect to the Use of U.S. Military Power in Greece,” not printed, was a revision of NSC 5/3, May 25, 1948, approved by President Harry S. Truman. For the text of NSC 5/3 and the amendment constituting NSC 5/4, see ibid. 1948, vol. iv, pp. 93 and 99.
6. Reference is to “An Act to amend the Mutual Defense Assistance Act of 1949,” approved June 26, 1950; 64 Stat. (pt. 1) 373. For documentation on the overall U.S. military assistance program, see vol. i, pp. 126 ff.
7. The Joint Chiefs of Staff on March 11, with the approval of the Department of State and the Secretary of Defense, had directed the inactivation of the Joint U.S. Military Advisory and Planning Group in Greece and the establishment of the Joint U.S. Military Aid Group (JUSMAG) to Greece.
8. This communication, dated May 29 and delivered May 30, from the Acting Representative of the United States at the United Nations, expressed the hope “that the countries of Eastern Europe … will be reminded of the right of Greek children involuntarily in their midst to return to … their own country” (telegram 279, May 29, to the U.S. Mission at the United Nations, 781.00/5–2950, also, U.N. doc. A/1284).
9. Reference is to the resolution of July 18 by the U.N. Special Committee on the Balkans, cited in footnote 4, p. 385.
10. See the Department of State Bulletin, June 5, 1950, pp. 883–884.
11. ibid., July 31, 1950, pp. 163–169. For documentation relating to Korea, see volume vii .