740.00119 Council/3–1847: Telegram
The Secretary of State to the President and the Acting Secretary of State
urgent
864. Delsec 1313. For the President and Acheson from Marshall. Eighth CFM, 18 March, Bevin presiding.
Bidault opened by stating that security was the first consideration of France in any discussion of Germany’s economic unity. Secondly, he said, France wanted adequate reparations and a balance of German payments sufficient so that occupation costs would not have to be paid by the occupying powers. He felt that these requirements could be met and still provide a decent standard [of] living to Germany.
Bidault proposed the creation of an international agency to control the use of all German coal and opposed raising the previously agreed level of the German steel industry. He referred to the creation of a special regime for the Ruhr and reaffirmed the French position that German economic unity is acceptable only if the Saar is integrated at once into the economic and monetary system of France. He said France [Page 263] could not approve the creation of central German administrative agencies until the German frontiers were fixed. He suggested that the Deputies be asked to define “economic unity” in order that the Council could decide what agencies were necessary to effect unity.
On the subject of reparations, Bidault asked that removals be resumed and speeded up. He accepted in principle and suggested that close study be given to taking reparations from current production. He saw a danger for the future in the desire of the US, UK and USSR to raise the German level of industry and said that France could not accept an increase in the agreed level without the assurance that French views on the future of Germany would be adopted.
He repeated French acceptance of the draft US demilitarization treaty for Germany, but said that later he would propose additional clauses dealing with economic disarmament and sanctions. He tabled a detailed proposal on reparations.
There followed a rather heated exchange on reparations between Bevin and Molotov which led up to Bevin’s stating that the UK would list reparations it has received from Germany and hoped that the other powers would do likewise.
In answer to Molotov’s charges, I stated that we had taken no reparations from Germany and had in fact spent US funds in our zone; further, that we had made freely available to all the German patents obtained by US. In answer to Molotov’s interpretation yesterday of the Crimea decision, I reaffirmed our position that the agreements at Potsdam superseded the preliminary agreement on the subject reached at Yalta.
Considerable discussion failed to result in a decision on whether the Council is to hear representative of the Inter-Allied Reparations Agency and further discussion was deferred until tomorrow.