47.12.17
(890w)
MEMORANDUM OF CONVERSATION1
December 17, 1947
Top Secret
London, England
Subject: Conversation between Secretary Marshall and
M. Bidault, Claridges Hotel, Room 228, December 17, 1947, 3:45 p.m.
The Secretary opened the conversation by saying that the failure of the CFM
raised a number of important questions relating to Germany and the three western
occupying powers.
First was the question of the relationship between the U.K. and U.S. zones on the
one hand and the French zone on the other. The Secretary suggested a good approach to
the subject would be for the French to examine the fusion agreement between the British
and the U.S. Governments and to prepare a criticism, from the French point of view, of
its provisions.
Bidault said that this suggestion seemed to be reasonable. He implied, however,
that some time would be necessary to arrive at a fusion of the French zone with the other
two zones and that this should be an evolutionary development. There were many
questions to which it was related—the question of the Saar and the question of the Ruhr.
The Secretary then went on to say that in Berlin there were several steps which he
hoped would be discussed and taken as soon as possible.
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The first of these was currency reform. He thought that the matter would be
proposed to the Allied Control Council in the hope that it would receive four power
approval and provide a currency for all of Germany. Should it fail to receive endorsement
by the four powers, he hoped that it would be acceptable to the occupying powers of the
three western zones. A sound currency was important to the rehabilitation of Western
Germany—the production of coal, etc.—so that she could play her part in assisting
European recovery.
The second step, he suggested, would be the removal of the French zonal
restrictions on the movement of people and goods so that the zonal boundaries would
constitute no interference to the circulation of people, particularly trade union leaders,
and to the flow of commodities between the zones.
The third step, he said, might be the adoption, in so far as practicable, by the
French occupying authorities of procedures within the French zone similar to those
followed in the U.S.-U.K. zones. This would bring the zones into greater harmony by
evolutionary processes.
The question of the Saar should be disposed of as soon as possible. The two
important factors were, of course, financial adjustments within the U.S.-U.K. zones, and
coal. France would have to make her own case before ECO for coal allocations.2
As to the Ruhr, the Secretary said he was anxious that the French explore the
matter with us and the U.K. He hoped, however, that no action would be suggested which
might retard increased production. The problem divided itself into two parts. The first
embraced a period when the production of the Ruhr had to be increased. Coal was the
bloodstream of Europe; its production must rise so that it can become available in much
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greater quantities for European recovery. Production generally too must increase. During
this period (which he called the short range one) of low production no question of
security arose except as the pattern of things established then might give rise to security
problems later. During the short range period, the occupying powers would be in control
of Europe. The second (which he called the long range one) commenced when production
was high and the occupational period was over. The Ruhr might then present a problem
of security. Except for the possibility that methods adopted during the first, or short
range, period might affect the long range, it was of the latter (that is, the long range) that
it was hoped that there would be an exchange of views for the purpose of arriving
ultimately at some satisfactory solution. He hoped that the exchange of views and
discussion on this subject would be held in London.
As to the Secretary’s remarks on the discussions and steps to be had in Berlin,
Bidault at first did not quite understand. He indicated that London would be an
acceptable place for discussions on the Ruhr though he thought all problems were related
and should be considered together. When, however, he understood that many of the steps
to be discussed in Berlin could be taken more by administrative action than by formal
agreement he indicated that what the Secretary had suggested was agreeable and that
without entering a fusion agreement immediately offered no serious obstacle.
Bidault thought, however, that some of the questions could not be divorced from
the Ruhr. Berlin might not be the best place for discussion of them since among other
reasons Koenig was inclined to have a “negative” approach to the problems.3
NA/RG 59 (Top Secret Decimal File, 740.00119 Control [Germany]/12–1747)
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1. Ambassador Lewis W. Douglas was present at the meeting and wrote this
memorandum.
2. The European Coal Organization (ECO) was created in January 1946 by the
United States and nine nations of western Europe. It allocated coal shipments and
purchases from the United States. By the autumn of 1947, the organization had become
the Coal Committee of the Economic Commission for Europe, which had been
established on March 28 as a part of the US Economic and Social Council.
3. Général d'Armée Marie Pierre Koenig had been head of the French occupation
zone in Germany since 1945. He was identified politically with Charles de Gaulle.
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