740.00119 Council/3–448: Telegram
The Ambassador in the United Kingdom (Douglas) to the Secretary of State
urgent
874. Delsec 1613. For Wisner from Douglas. This afternoon Bevin sent me, through Strang, an informal note in regard to reparations. It had been hastily dictated.
[Page 129]It represents his personal views which he intends to put forward to his Cabinet colleagues. I have paraphrased it as follows:
Two points regarding reparations have been raised by Douglas with Bevin. In considering them we must remember that the British Cabinet has already taken a decision that reparations to the Soviet Union were not [to] be discontinued. Therefore, a new Cabinet decision would be required if this is changed.
Referring to the first point, Bevin understands that we contemplate a revision of the list of plants to be allocated and dismantled, and that the revision would affect principally the British Zone. The idea of substitutions has been suggested by Douglas. Bevin is unable to accept the substitution idea, because British have agreed, in accordance with an arrangement made with US Government, that when the level of industry was fixed, a list would be published and the Germans assured that there would be no further change. British do not want to go back on this assurance, or to initiate discussion with the Germans regarding substitutions, thereby reopening reparations question. Bevin believes that if US presses the UK on this question, consideration must be given to an increase in the industry level and to the security question. Before a decision could be made it would be necessary to know what plants would be involved and whether British should agree unilaterally to what amounts to an increase in industry level. If Bevin believes the list of plants is reasonable, he will consult the French before making a decision on this point.
As to the second point Douglas has raised, regarding deliveries to the Soviet Union, Bevin says that he is subject to a definite pledge which was made after consultation with the US, and which cannot be confused with the rest of the Potsdam Agreement. In Moscow Bevin stated that the list of category I war plants would be completed, allocated and delivered regardless of anything else, and that when the industry level was settled the list of plants would be completed and delivered. He thinks we are on very bad ground to say that Soviets are in default respecting reciprocal deliveries.
The ten percent would represent a very small amount, particularly in view of the increase in the level of industry to which it is now proposed to add some additional plants. To suspend these deliveries endangers the quadripartite machinery which Bevin agreed in London not to jeopardize unduly when its importance was impressed upon him by Marshall who, with Douglas, urged the point strongly in connection with the currency reform. To stop these deliveries would endanger our position in Berlin and would furnish a propaganda point to the Soviets which would look to the rest of the world as if we were acting spitefully and not constructively.
Bevin hopes British will not have to operate under a threat affecting [Page 130] the European Recovery Program and believes that this would react badly against the US.
Foregoing points are made with due respect to our viewpoint, but reflecting Bevin’s European point of view. He believes, personally, that if British try to cooperate with US on first point and can find a reasonable arrangement, the second point, regarding deliveries, should not be pressed by US.
I shall try to see Bevin again before he puts forward his views to his Cabinet colleagues, in an attempt to persuade him to change his position at least in regard to delivery of reparations to the Soviet. In view, however, of what I sense to be a growing apprehension on the part of the British, French and Benelux countries that some action on our part might precipitate an open and complete break with the Soviets, I am doubtful that I will be able to influence Bevin to change his position at least before I leave here Saturday evening.