762A.00/5–2754
No. 241
Paper Prepared in the Office of
German Affairs1
Subject: Developments in Germany since April 25
No individual events in German affairs since the start of the Geneva conference have appeared on the surface especially noteworthy or important, except for the progress on the Saar question (see below).
However, a series of relatively minor developments has indicated clearly an increasing German restiveness which has been especially prevalent in political and press circles during the last month. The Chancellor’s fine speech of April 29 during the foreign affairs debate in the Bundestag met with unaccustomed resistance, and he was forced to a maximum exertion of his political strength in order to obtain a favorable vote on the government’s policy. The current speculation on the possibility of establishing some kind of contact between the Soviet Union and the Federal Republic, while it is contrary to the Federal Government’s policy and represents no consistent objective or point of view in German public opinion, still indicates a keen responsiveness to some new approach in German policy and reflects a widespread feeling of frustration over the failure to achieve German unification on the one hand, and the delay [Page 571] in the contractuals and EDC Treaty on the other. Most significant of all, Dr. Conant has reported that the Chancellor doubts his own ability to continue holding the line with the Western Allies on the present basis of their relations with Germany for more than a few months in the face of pressure from party leaders and public opinion reflecting lack of progress on EDC and the contractuals.2 The Chancellor’s situation is aggravated by coming Land elections, the first of which will take place in North Rhine-Westphalia in June. Dr. Conant believes strongly that if, following the Geneva Conference, France continues to delay bringing EDC to a vote, we and the British must, in order to prevent a complete deterioration in Dr. Adenauer’s position, take positive steps (even without the French) to implement the contractual agreements with Germany.
Much thought has been given by the Federal Government and the Allies to the problems that may arise out of the recent Soviet move to confer sovereign status on the East German Government, and a tripartite paper on this subject is on its way to Washington. So far, however, the Soviet side has raised no real difficulties in this connection. No non-Communist country has recognized the East German Government, and at least half of the fifty-two nations addressed by the Federal Republic after adoption of the Bundestag resolution against recognition have given assurances that they do not intend to recognize that regime.
The Saar
The continuing discussion of the Saar question culminated in a meeting at Strasbourg, where on May 20 Chancellor Adenauer and Vice Premier Teitgen reached an agreement on the principles of a settlement based on the van Naters report. This agreement was then referred to the German and French Cabinets for approval, but the situation has become increasingly confused. The French have said there was no final agreement and have attempted to reopen negotiations at Bonn. The Germans have maintained that the agreement is final. While our impression is that this may be the last chance for the French to reach a settlement on the Saar as favorable as this one, we and the British are refraining from any form of direct intervention, in view of Mr. Spaak’s advice to this effect and Teitgen’s specific request for a few days in which to persuade the French Cabinet to adopt the agreement.3
[Page 572]Economic Relations
Our relations with the German Government in the economic area continue to develop along satisfactory lines in the direction of reestablishing a normal relationship. In the past month further progress has been made toward completing a number of important economic agreements which have been under negotiation for some time. By way of illustration, we hope to sign a double tax convention within a matter of days, and a treaty of Friendship, Commerce and Navigation next month, or later in the summer.
A difficult negotiation is now in progress between the Occupying Powers, on the one hand, and the German Finance Minister, on the other, concerning a formula for extending an agreement on the German contribution to a common EDC budget and on support costs for our forces after the EDC enters into effect. The difficulty seems to arise from domestic budgetary problems in Germany, rather than any basic change in policy.
As regards Berlin, approval of Congress has been requested for the appropriation of $25 million to maintain the economic and political position of the city.
The refugee problem remains chronic but poses no immediate major difficulties. Since March 1, 1954, the influx into Berlin has been fairly constant, 350–400 daily.
- Attached to a memorandum from Merchant to Dulles, dated May 27, which stated that it was EUR’s response to a recent request from the Secretary’s Office.↩
- See footnote 3, supra.↩
- For documentation on van Naters’ report on the Saar and the Teitgen–Adenauer agreement, see Document 640 and Documents 686 ff.↩