Foreign Relations of the United States, 1945–1950, Emergence of the Intelligence Establishment

307. Memorandum for the File⁰

Washington, November 16, 1948.

SUBJECT

• Relationship and proposed course of dealing as between OPC and ECA; memorandum of conversation between H1, H2 and FGW¹

1. On the afternoon of November 16, I had a very extensive conversation with H1 and H2 at their office and the following are some of the most important features of this conversation.

2. I explained generally our significance and I mentioned a few of the thoughts which we have had in connection with our possible usefulness to the mission of ECA in Europe. H2 wanted to know whether we would be handling the ECA counterpart fund arrangement in Italy and I told him that we would take this over as soon as we were in a position to do so. He then spoke of France, saying that the situation there was most critical and that he believed that everything should be done by way of giving support to the anti-communist elements of French labor. [28 lines of source text not declassified] H1 having reentered the room the conversation broadened out to a detailed discussion of the situation in general within France. H1 and H2 are both of the opinion that the Marshall Plan is less successful, less understood and less appreciated in France than in any other Western European nation. They are very concerned about this and they proposed that a fully coordinated all out effort should be made to regain control of the situation which has slipped so badly. They requested me to take the lead in working out an overall plan for [1 line of source text not declassified] building up the Marshall Plan in France and combating the communist efforts to wreck it. H2 is very keen about this and wants to follow up early next week. I suggested that as the first step he and I should meet with George Kennan to discuss this problem and to block out the work. I further stated that by the time this meeting occurs, I would endeavor to have ready in rough form a memorandum raising the various possibilities which had occurred to me. [2 lines of source text not declassified] They both stressed that time is of the essence and that matters have taken such a serious turn in France that no effort should be spared. H1 said that he had been devoting some thought to various types of overt publicity and H2 said that his people in Paris had also been thinking about this but with the general conclusion so far that obviously self-serving and American financed publicity might do more harm than good. He was not satisfied with this conclusion and agreed with H1 that it was a matter of method and presentation. H1 then suggested that it might be possible to use ECA counterpart funds for the publication of a “report” on the Marshall Plan aid, mentioning quantities and the uses to which the aid had been put. [3 lines of source text not declassified] H2 undertook to cable Al Friendly² to get his reaction. H2 then stated that he believed the military should be interested in this overall program since the situation in France is crucial to their plans for Western European defense. If France falls out of line, the whole military defense program (Western Union Military Alliance) will crumble. H1 then stated that moving picture might be employed. He thought that what the French need most is a rejuvenation of spirit and he believed that an extensive showing of the recently released “Joan of Arc” might have an electrifying effect upon French psychology. He asked me to send a qualified person to see this movie and to give him a report on its possible effect upon the French people.

3. The conversation having turned toward the subject of French morale and its effect upon the political situation, I then asked H2 for his view about the prospects of deGaulle’s accession to power. He replied at length stating that although this appears to be an odds-on bet, he felt that it would be very bad and that it might well result in an impossibility of dealing constructively with the French on either military or economic matters. [3 lines of source text not declassified] I mentioned that certain very competent observers of the French political situation had become convinced that deGaulle’s accession to power was inevitable and had suggested that we should start laying our plans with a view to establishing a basis of dealing with deGaulle. I wondered what H2 thought of this. He first replied that it would be “playing with fire”. Later on, however, he seemed to modify his position by stating that we should certainly establish better contacts with deGaulle and his people than we now have. Moreover, toward the close of the conversation and in commenting upon the overall program, H2 was at pains to make it clear that this should be done on a completely “non-partisan” basis. H1 agreed with H2 that the whole emphasis should be laid upon French economic recovery and the successful working of the Marshall Plan. I was left in some doubt as to the strength of H2’s conviction in regard to the deGaulle business.

[2 paragraphs (14 lines of source text) not declassified]

F.G.W. ³

0. Source: Central Intelligence Agency Historical Files, HS/CSG–453, Job 83–00036, Box 3, Folder 4. Secret.
1. The identities of H1 and H2 are conjectural, although they are obviously senior officials of the Economic Cooperation Administration and/or the ECA representation in Europe. Among possible identifications are Paul G. Hoffman, the ECA Administrator; W. Averell Harriman, the U.S. Special Representative in Europe; and David K.E. Bruce, the head of the ECA mission in Paris.
2. Chief of Information in the office of the U.S. Special Representative in Europe.
3. Printed from a copy that bears these typed initials.