42. Memorandum From the Assistant Secretary of State for European Affairs’ Special Assistant (Reinstein) to the Assistant Secretary of State (Merchant)1
SUBJECT
- Discussion of Military Assistance and German Buildup with Ambassador Conant, Wednesday, January 11, 1956, 4:30 p.m.
- I.
-
Mr. Conant submitted his views on these problems in a despatch we have just received (Bonn’s 1337).2 He discusses German intentions and the progress of their efforts along much the same lines I reported to you on my return from Germany. He says that the Chancellor is principally concerned with making a political demonstration of Germany’s allegiance to the West. He thinks the Chancellor can be expected to demand steady progress but not to compel (if he could) his Government and Parliament to take the measures which would be necessary to complete the buildup within three to four years. He says the Economic and Finance Ministries are particularly concerned to protect their policies and position and the Defense Ministry is not well organized or particularly aggressive. Finally, he points out that the insistence of the Parliament and people that the creation of armed forces be given a secure basis in German society and law delays the buildup. He believes the buildup will be stretched out well beyond a three to four year period unless there is a dramatic outside event such as intensification of the cold war or an indication of intense United States interest in a rapid buildup demonstrated by an offer of a very substantial amount of additional military assistance.
Mr. Conant believes that anything less then a very substantial amount of additional military assistance could not be relied on to insure the realization of a rapid buildup. He thinks, however, that failure to grant a small amount of additional assistance would be interpreted by the Germans to mean that the United States no longer regards a rapid buildup particularly important. He suggests that the United States should take the position that we could not consider additional aid until we have a clear expression of German intentions to increase their budgetary provisions for the second and third years of the buildup and take the legal, technical, economic and financial action required to achieve a three to four year buildup. However, he believes we may have to grant some additional aid on political grounds if it appears to be in our interest to do so. If we do so we [Page 68] should obtain as much in the way of firm commitments from the Germans as possible. Mr. Conant says finally that if we use military assistance to get additional support costs, we cannot expect this to accomplish anything of significance in regard to the speed of the buildup.
- II.
- I suggest you give Mr. Conant a brief summary
of the thinking within the Administration on military assistance
generally and assistance to Germany in particular. This might serve
as a preface to telling him about your agreement with Gray that we should study the whole
series of problems involved in the German buildup and United states
military assistance to Germany, testing all of the past assumptions
which have been the basis of our thinking and attempting to arrive
at a comprehensive statement of what we hope will be achieved in
Germany and how best we can contribute to reaching our objectives. I
think you might mention the following points as indicative of the
type of problem we think requires much more thought than has yet
been given to it:
- A.
- The key position that conscription will play in the timing of the German buildup and the question of whether the German Government should be held to its statements that it will pass a conscription law before the 1957 elections.
- B.
- The possibility of inflationary developments if a rapid buildup is attempted. I believe the Embassy has discounted this possibility too much and that inflation could be a serious threat to political stability in Germany if too much were attempted too soon.
- C.
- The type of equipment the German Forces should have when they are ready three or four years hence. I do not think present planning takes nearly adequate account of newer models of conventional weapons or some of the new weapons.
- D.
- The essential place which comprehensive information on German equipment requirements, in detail, has in determining United States aid policy and programs. Exploitation of possibilities of procurement by the Germans in Europe and the programming of United States production for the Germans (regardless of whether it is given or sold) cannot get forward except on the basis of detailed plans. The Embassy’s views on the broader aspects of the problem as, for example, in the despatch summarized above, cannot be fully utilized here in Washington without this kind of basic spade work, which we do not yet have.3