concerned actually participated in the fighting. But all would have an opportunity to present their views, and rebut other views, and all would sit in the peace conference to adopt a treaty. It is difficult to get the agreement of the countries that have suffered the horrors of German occupation and were involved in heavy losses in hard fighting to accept participation in the determination of the treaty terms by countries who suffered no losses in men or material and were remote from the fighting. The United States, however, regards it as imperative that all the states who were at war with Germany should have some voice in the settlement imposed on Germany. FOUR POWER PACT The proposal for the Four Power Pact was advanced by the United States Government a year ago. It was our hope that the prompt acceptance of this simple pact ensuring in advance of the detailed German peace settlement that the United States would actively cooperate to prevent the rearmament of Germany would eliminate fears as to the future and would facilitate the making of a peace suitable to Europe's present and future needs. It was our hope that such a commitment by the United States would relieve the fear of the other European powers that the United States would repeat its actions following the first World War, insisting on various terms for the peace settlement and then withdrawing from a position of any responsibility for their enforcement. It was thought that the compact of the four powers to guarantee the continued demilitarization of Germany would reassure the world that we were in complete accord in our intention to secure the peace of Europe. However, the Soviet Government met our proposition with a series of amendments which would have completely changed the character of the pact, making it in effect a complicated peace treaty, and including in the amendments most of the points regarding the German problem concerning which there was, as I have pointed out, serious disagreement. I was forced to the conclusion by this procedure that the Soviet Government either did not desire such a pact or was following a course calculated to delay any immediate prospect of its adoption. Whether or not an agreement can finally be reached remains to be seen, but the United States, I think, should adhere to its present position and insist that the pact be kept simple and confined to its one basic purpose-to keep Germany incapable of waging war. AUSTRIAN TREATY The negotiations regarding the Austrian treaty resulted in agreement on all but a few points, but these were basic and of fundamental importance. The Soviet Union favors and the other governments oppose the payment of reparations and the cession of Carinthia to Yugoslavia. But the Soviet Government attached much more importance to its demand that the German assets in Austria which are to be hers by the terms of the Potsdam Agreement should include those assets which the other three powers consider to have been taken from Austria and the citizens of the United Nations by force or duress by Hitler and his Nazi government following the taking over of Austria by military force in March 1938. The Soviet Government refused to consider the word duress, which in the opinion of the other three powers would be the critical basis for determining what property, that is, business, factories, land, forests, et cetera, was truly German property and not the result of seizures by terroristic procedure, intimidation, fake business acquisition, and so forth. The Soviet Union also refused to consider any process of mediation to settle the disputes that are bound to arise in such circumstances, nor would they clearly agree to have such property as they receive as German assets subject to Austrian law in the same manner as other foreign investments are subject to Austrian law. The acceptance of the Soviet position would mean that such a large portion of Austrian economy would be removed from her legal control that Austrian chances of surviving as an independent self-supporting state would be dubious. She would in effect be but a puppet state. All efforts to find a compromise solution were unavailing. The United States, in my opinion, could not commit itself to a treaty which involved such manifest injustices and, what is equally important, would create an Austria so weak and helpless as to be the source of great danger in the future. In the final session of the Conference, it was agreed to appoint a Commission to meet in Vienna May 12th to reconsider our disagreements and to have a Committee of Experts examine into the question of the German assets in Austria. Certainly prompt action on the Austrian treaty is necessary to fulfill our commitment to recognize Austria as a free and independent state and to relieve her from the burdens of occupation. SUMMARY Complicated as these issues are, there runs through them a pattern as to the character and control of central Europe to be established. The Foreign Ministers agreed that their task was to lay the foundations of a central government for Germany, to bring about the economic unity of Germany essential for its own existence as well as for European recovery, to establish workable boundaries, and to set up a guaranteed control through a four-power treaty. Austria was to be promptly relieved of occupation burdens and treated as a liberated and independent country. Agreement was made impossible at Moscow because, in our view, the Soviet Union insisted upon proposals which would have established in Germany a centralized government, adapted to the seizure of absolute control of a country which would be doomed economically through inadequate area and excessive population, and would be mortgaged to turn over a large part of its production as reparations, principally to the Soviet Union. In another form the same mortgage upon Austria was claimed by the Soviet Delegation. Such a plan, in the opinion of the United States Delegation, not only involved indefinite American subsidy, but could result only in a deteriorating economic life in Germany and Europe and the inevitable emergence of dictatorship and strife." Freedom of information for which our Government stands inevitably involves appeals to public opinion. But at Moscow propaganda appeals to passion and prejudice appeared to take the place of appeals to reason and understanding. Charges were made by the Soviet Delegation and interpretation given the Potsdam and other agreements, which varied completely from the facts as understood or as factually known by the American Delegation. There was naturally much uncertainty regarding the real intention or motives of the various proposals submitted or of the objections taken to the proposals. This is inevitable in any international negotiation. However, despite the disagreements referred to and the difficulties encountered, possibly greater progress towards final settlement was made than is realized. The critical differences were for the first time brought into the light and now stand clearly defined so that future negotiations can start with a knowledge of exactly what the issues are that must be settled. The Deputies now understand the precise views of each government on the various issues discussed. With that they can possibly resolve some differences and surely can further clarify the problems by a studied presentation of the state of agreement and disagreement. That is the best that can be hoped for in the next few months. It marks some progress, however painfully slow. These issues are matters of vast importance to the lives of the people of Europe and to the future course of world history. We must not compromise on great principles in order to achieve agreement for agreement's sake. Also, we must sincerely try to understand the point of view of those with whom we differ. In this connection, I think it proper to refer to a portion of a statement made to me by Generalissimo Stalin. He said with reference. to the Conference, that these were only the first skirmishes and brushes of reconnaissance forces on this question. Differences had occurred in the past on other questions, and as a rule, after people had exhausted themselves in dispute, they then recognized the necessity of compromise. It was possible that no great success would be achieved at this session, but he thought that compromises were possible on all the main questions, including demilitarization, political structure of Germany, reparations and economic unity. It was necessary to have patience and not become pessimistic. I sincerely hope that the Generalissimo is correct in the view he expressed and that it implies a greater spirit of cooperation by the Soviet Delegation in future conferences. But we cannot ignore the factor of time involved here. The recovery of Europe has been far slower than had been expected. Disintegrating forces are becoming evident. The patient is sinking while the doctors deliberate. So I believe that action cannot await compromise through exhaustion. New issues arise daily. Whatever action is possible to meet these pressing problems must be taken without delay. Finally, I should comment on one aspect of the matter which is of transcendent importance to all our people. While I did not have the benefit, as did Mr. Byrnes, of the presence of the two leading members of the Senate Foreign Relations Committee, I did have the invaluable assistance of Mr. Dulles, a distinguished representative of the Republican party as well as a recognized specialist in foreign relations and in the processes of international negotiations and treaty-making. As a matter of fact, the bipartisan character of the American attitude in the present conduct of foreign affairs was clearly indicated by the strong and successful leadership displayed in the Senate during the period of this Conference by Senators Vandenberg and Connally in the debate over a development of our foreign policy of momentous importance to the American people. The fact that there was such evident unity of purpose in Washington was of incalculable assistance to me in Moscow. The state of the world today and the position of the United States make mandatory, in my opinion, a unity of action on the part of the American people. It is for that reason that I have gone into such lengthy detail in reporting my views on the conference. 24. FIFTH MEETING OF THE COUNCIL OF FOREIGN MINISTERS, LONDON, NOVEMBER 25 DECEMBER 16, 1947 Report by Secretary Marshall, December 19, 1947 1 1 The result of the recent meeting of the Council of Foreign Ministers in London was disappointing. I realize that the many lengthy statements and the frequent and fundamental disagreements were very confusing to the general public. Also, the continuous accusations against the good faith, the integrity, and the purposes of the governments of the western powers, particularly the United States, necessarily added greatly to the confusion. This was, as a matter of fact, one of the purposes of these attacks. I anticipated great difficulty in reaching a comprehensive agreement, but I did have a hope that we might take three or four fundamental decisions which would permit immediate action by the Four Powers to alleviate the situation in Germany this winter and greatly improve the prospects for all of Europe. That we failed to reach any such agreements is the greatest disappointment. The United States Delegation went to London with an open mind, as I had stated we would in Chicago, but we went with a strong determination to bring to an end the division of Germany which has existed since the German capitulation. We were also determined that any agreement reached at London should be a genuine workable agreement, and not one which would immediately involve obstruction and frustration in the Allied Control Council when it came to be put into effect in Germany. I shall review only briefly the interminable discussions during the weeks of debate at London. To us it was but a dreary repetition of what had been said and resaid at the Moscow conference. I shall endeavor, however, to point out the main issues on which the Conference deadlocked and give you my estimate of the underlying reasons. The basic issue, as we saw it before the opening of the London conference, was whether or not the Allies could agree among themselves to reunite Germany. The issue in regard to the Austrian treaty was even simpler and had already emerged clearly at the Moscow conference. Because the two main issues which I have outlined would be the controlling factors in our discussions, three of the delegations had agreed that the Austrian treaty should be considered first and the economic principles to govern the treatment of Germany as an eco 1 Department of State Bulletin of December 28, 1947. nomic whole should come second. We felt that this order was logical and necessary if we were to debate with any prospect of success the remaining items on our agenda. The Soviet Delegation held a different view and insisted that questions on the preparation of a German peace treaty should be given precedence over the questions regarding immediate economic unity for Germany. In order to get the Conference started, it was finally agreed to accept the Soviet request that the preparation of a German peace treaty should be item two on the agenda. As a result, with the exception of one day of discussion of Austria and the Austrian treaty, it was not until after 10 days of meetings that the Conference really reached the heart of the German question. These first 10 meetings were devoted to futile and somewhat unreal discussion of the mechanisms for the preparation of an eventual German peace treaty before the question of whether or not there was to be a united Germany had even been considered. There was one question, however, of real substance during this phase of the discussion which had a direct application not only to a German peace treaty but also to the immediate situation in Germany. This was the question of the present and future frontiers of the German state. No serious consideration of a peace treaty could be undertaken without first considering what was to be the area of the future German state. Three delegations had already expressed their agreement that the area of the Saar should be separated from Germany and integrated into French economy. Mr. Molotov refused to commit his Government on this point. On this vital matter of frontiers, three delegations agreed to the establishment of a frontier commission or commissions to make an expert study of any proposed changes from the prewar frontiers. Mr. Molotov refused to agree. It was impossible for me to reconcile his urgent insistence upon the necessity of expediting the preparation for a German peace treaty with his categoric refusal to agree to the appointment of boundary commissions, which three delegations considered to be an absolutely essential first step in any serious preparation for a future German peace settlement. Many other questions concerning the actual preparation of any peace treaty were discussed without agreement. It was during this stage of the debate that Mr. Molotov insisted that the Four Powers should agree upon the immediate establishment of a German central government. Although the United States had been, I believe, the first of the four occupying countries to suggest at Moscow the desirability for the earliest possible establishment of a German provisional central government, it was obvious that until the division of Germany had been healed and conditions created for German political and economic unity, any central government would be a sham and not a reality. This view was shared by the other western delegations but to Mr. Molotov was completely unacceptable. This was the first clear evidence of his purpose to utilize the meeting as an opportunity for propaganda declarations which would be pleasant to German ears. After several days of consideration by the deputies, the Austrian treaty was again brought to the conference table on December 4. The sole issue discussed was the determination of what were the true German assets in eastern Austria to which the Soviet Union was fully entitled by the Potsdam agreement. This had been the stumbling |