396.1–ISG/3–851: Telegram
The United States Delegation at the Intergovernmental Study Group on Germany to the Secretary of State 1
Sigto 520. Schedule of future work of ISG was discussed by Steering Committee on March 6, with particular reference to work on claims. The background of the discussion was that the Steering Committee contemplates completing PLI this week;2 completing foreign interest and restitution during coming week, discussing waiver of claims and reparations during same week; going to Bonn for meeting special committee of HICOM and consultation with individual elements March 19 and 20. USDel proposed that prior to Easter, Claims Committee should complete survey of whole field of problems and that Steering Committee should review entire field. Steering Committee should recess from March 23 to April 3, at which time items remaining ISG agenda except debts would be taken up and if possible completed. The claims discussion should be recessed from March 23 to April 24. USDel proposed that beginning April 24, after having presumably completed other items of agenda, alternates should work full time on debts, utilizing if necessary several subcommittees (on financial problems, procedure, legal problems, etc.) in order to bring work to conclusion by May 15. May 15 target selected with a view to issuance of invitation at that time to stage two roundtable talks on German debts, for which at least one month’s advanced notice believed necessary.
British opposed strongly to proposals on debts. They question feasibility completing work in period April 24–May 15. They felt more time would be required to complete discussions and time would be required to obtain governmental approval. They regard one month interval between issuance of invitation and beginning of conference as [Page 1378] barest minimum and believe June 15 should be latest, not earliest date for beginning of stage two consultation. They assert that, if meeting not begun by mid-June, it will be impossible to begin conference until end of summer. This last point provoked lively discussion with USDel stating creditors should be eager to attend conference to discuss payments by Germany, UK and French stating prospects of payments were not sufficiently great to attract creditor representatives away from summer vacations.
It was agreed to recess Steering Committee as proposed by US, but British, while agreeing that Claims Committee should also recess, refused to fix date for resumption of discussions. They admitted if US were unable to resume prior to April 24, this would have to be date. They were, however, most unhappy. They would also not agree to US proposal respecting organization of work upon resumption, stating they did not believe other items of the agenda could be disposed of by April 24, or that it would be feasible to split work on debt among various sub-committees.
USDel view is that it is essential at this stage to appoint and prepare US team for final part on stage one negotiations in ISG and to carry on in later stages. Furthermore, we do not believe that with limited staff we now have, or with one or two additional people who have no background on discussion, it is possible for us to carry negotiations in stage one to completion without extended period in Washington. Instructions we have are of general character and require considerable spelling out. This could be done by substantial trained staff here. In absence of such staff, work must be done in Washington jointly by USDel and Washington agencies representatives. Furthermore, we see no prospect of completing negotiations without our having fully thought out US position on postwar debts, which we believe will require some period of consultation in Washington.
We are inclined to agree with British that stage one can not be completed by May 15 if discussions not resumed until April 24. Consequently, if stage one not completed by May 15 stage two would have to begin somewhat later than June 15.
Would greatly appreciate views of department regarding our proposals. Believe it desirable to fix schedule at earliest possible date and make consequent decision for personnel. Immediately following this, telegram contains recommendations on this subject.