Foreign Relations of the United States, 1952–1954, Western Europe and Canada, Volume VI, Part 1

MSA telegram files, FRC Acc. No. 54 A 298, “Paris Repto”: Telegram

No. 15
The Deputy United States Special Representative in Europe for Economic Affairs (Porter) to the Mutual Security Agency

secret
priority

Paris, March 20, 1952—9 p.m.

Repto 1321. Eyes only for Harriman, Draper, and Kenney. Pass State eyes only for Perkins.

1. In preceding cable have reported on luncheon discussion which Tasca, Stokes and I had with Stikker yesterday re issue at forthcoming OEEC mtg.¹ Stikker regards forthcoming mtg as major crisis in history of OEEC. He feels that if this mtg fails to come to grips with basic issues usefulness of org will be irretrievably damaged. This is view prevailing also in other circles close to OEEC and is emphasized by possible resignation of Marjolin in near future.

2. Fol are principal factors in present crisis as seen by Stikker, Marjolin and others with whom we have talked:

A. Negative Brit attitude as expressed in proposed 50 percent budget cut and narrow view of future functions of OEEC, which has recently been constant drag on effective OEEC work.

B. Reimposition of import quotas by Brit and Fr without prior consultation with OEEC and in sharp contrast to effective OEEC role in similar earlier balance of payments difficulties experienced by Gers and Dutch.

C. Failure of OEEC thus far to go beyond generalities in translating goal of 25 percent expansion of production into effective action.

D. Failure of OEEC thus far to have major influence on concerting of internal fin policy of major govts.

E. Decrease in close personal contact between key Eur econ mins such as prevailed in days of Bevin, Cripps and Petsche.

F. Belief on part of many Eurs that US now concerned only with def and has lost interest in OEEC as instrument of econ cooperation.

G. Lack of consultation with OEEC by US in determining distribution of econ aid. (This emphasized by both Stikker and Marjolin.)

3. Obviously all of above difficulties will not be overcome at forthcoming mtg. Stikker feels, however, that it is essential that decisions on several major issues be taken which will demonstrate determination of govts to make full use of OEEC as means of common solution of common problems. In our view, this means that OEEC must deal successfully with problem of strengthening EPU, with problems of fin stability on concerted basis, must reverse trend toward breakdown of trade liberalization and give evidence that proposed increase in production is more than pious hope. It is highly improbable that foregoing actions can be taken unless Brit at next week’s mtg show more constructive attitude than at present.

4. In view of foregoing, we in MSA/E have concluded that personal message from Acheson to Eden prior to mtg would probably be of major importance in inducing positive Brit attitude.² We are reliably informed that during course of current mtg of ministerial comite of Council of Europe both Stikker and Schuman are making strong plea to Eden for Brit support for OEEC. We have been given good reason to believe that message from Secty to Eden fol representations by Stikker and Schuman may well be decisive factor, particularly inasmuch as Brit coolness stems from FonOff rather than Treasury or Board of Trade.

5. Suggested message or note to Eden might appropriately include fol points:

A. US hopeful that we and Brit will not go into Council of Mins mtg with widely divergent views on basic problems.

B. Weakening of OEEC would not strengthen NATO but on contrary would deprive it of essential support in econ field.

C. Specifically OEEC can effectively implement econ and fin sections of Lisbon TCC resolutions relating to NATO buildup.

D. Any transfer of present OEEC functions to NATO would thereby exclude participation of Ger, Austria, Sweden, Switzerland and Ireland; this would not only greatly reduce useful scope of cooperation but might well give offense to Ger with possibly adverse effect upon Eur defense community.

E. Whole question of aid to Eur now being reexamined by Congress in critical atmosphere. As Eden aware, serious doubts as to need for any econ aid have been expressed by influential members with specific ref to UK. Single aspect of aid program with which Congress seems most sympathetic is support for cooperative efforts of Eur countries. Many members have evidenced dissatisfaction with progress in this respect and have talked of exerting greater pressure for Eur unification in pol as well as econ field. Seriously concerned that any action of UK which might be construed in Congress as scuttling of OEEC might have direct effect on size of appropriation for whole program legislative record bearing on UK’s share in program, and insertion in legislation of rigid conditions as to participation in unification of Europe as prerequisite of receiving aid.

6. We are increasingly disturbed by growing conviction on continent that Brit are bent on reducing OEEC to insignificant role and by effect this could have on major US objectives in Europe. In this connection we plan to request our missions discuss with Mins attending OEEC mtg importance of successful outcome of mtg. We believe we will find other govts sympathetic on most specific issues and strongly agreed on need for assuring future effectiveness of OEEC. In case of UK, however, approach at highest possible level seems called for, and message from Secty to Eden on general UK attitude would facilitate useful discussion of agenda with UK Mins and officials more directly concerned with preparation for mtg.

Merchant concurs.

7. Since preparing above, Tasca and I have had long talk with Nor PriMin Lange. He shares concern of Stikker and others about Brit attitude toward OEEC and is in full accord with view that decisive action shld be taken on specific issues at forthcoming mtg which will strengthen org. He said that at today’s Council of Europe mtg he, Stikker and Van Zeeland had made speeches emphasizing importance their govts attach to OEEC, which speeches were intended for Eden’s ears.

Porter

1. For a general summary of the OEEC Ministerial meeting, Mar. 27–29, see Document 26.
2. For text, see Document 18.