NATO NATO UNCLASSIFIED and Copy No. PUBLIC DISCLOSED NORTH ATLANTIC COU NCI .L ... SEVENTH S ES S. I P.3-g r> CONSEIL DE L'ATLANTIQUE NORD. SEPTIEME SESSION SECRET SUMMARY RECORD 07^2" 0R„ E1NG;. 7 16 September, 1951

Summary Record of the SocondMeetin^ held at the Parliament Buildings, Ottawai, on Saturday, 15th Septemberi, 1951 at _3

PRESENT :

M. (); Chairman

BELGIUM

M. Jean van Houtte (Minister of Finance) Colonel B.E.M. Etienne de C-reef (Minister of National Defence) M. Fernand van Langenhove• (Council Deputy)

CANADA

The Hon. L.B. Pearson (Secretary of State for External Affairs) The Hon. Brooke CIaxton, K.C. (Minister of National Defence ) The Hon. D.C. Abbott, K.C. (Minister of Finance) Mr. Dana Wilgress (Council Deputy)

DENMARK

^''Mr. Ole Pjprn Kraft (Minister for Foreign Affairs) Mr. Thorkil Kristensen (Minister of Finance) Admiral E.J.C. Qvistgaard (Chief of National Defence ) Mr. V. de : Steensen-Leth (Council Deputy)

FRANCE

S.S. M. Robert Schuinan (Minister for Foreign Affairs) M. Rens Mayer (Minister of Finance ) M. Georges Bidault (Minister . of' National-Defence )

DECLASSIFIED - PUBLIC DISCLOSURE / DÉCLASSIFIÉ - MISE EN LECTURE PUBLIQUE LECTURE EN - MISE / DÉCLASSIFIÉ DISCLOSURE - PUBLIC DECLASSIFIED S. E. ' M. "'Herve Alphand (Council Deputy)

ICELAND

Mr. Thor Thors- (Minister for Canada)- Mr, G. Petursson (Council Deputy)

ITALY

The Hon. Alcide De Gasperi (Prime Minister, Minister for. Foreign Affairs) ( Ttie Hon. Guiseppe Pella (Minister of Budget) The Hon. Randolfo Pacclardi (Minister of Defence) Signor Alberto Rossi Longhi (Council Deputy)

U.) SUMMARY RECORD Ç7-R/2

LUXEMBOURG

$¢. P • Dupong (Prime Minister and Minister of Finance ) M. A. Clasen (Council Deputyl NETHERLANDS Dr. D.U. Stikker (Minister for Foreign Affairs) Mr. C. Staf (Minister, of Defence) Prof, Dr. P. Lieftinck (Minister of Finance) Prof, pi», J.R.M, van den Brink (Minister for Economic Affairs) Jonkheer A.W.L. Tjarda van Starkenborgh Stachouwer (Council Deputy) NORWAY

Mr, Halvard Lange (Foreign Minister) Mr. Jens Chr. Hâuge (Minister of Defence) ,Mr. Erik Brofoss (Minister of Trade) Mr. Dag Bryn (Council Deputy)

PORTUGAL Dr. Joao Pinto da Costa Lëite (Minister for the Presidency . ' - Deputy Prime Minister) Dr. Paula Cunha (Minister for Foreign Affairs) Dr. Ruy Ennes Ulrich (Council Deputy) UNITED KINGDOM The Rt. Hon. Herbert Morrison, (Secretary of State for Foreign M.P. Affairs) The Rt. Hon. Emmanuel Shinwe11, (Minister of Defence) M.P. The Rt. Hon. Hugh Gaitskellj M.P. (Chancellor of the Exchequor) Sir Frederick Hoyer-Millar, (Council Deputy) K.C.M.G., C.V.O.

UNITED STATES

The Hon. Dean Acheson (Secretary of State.) The Hon. John Snyder (Secretary of Treasury) The Hon. Frank H. Pace, Jr. (Secretary of the Army) The Hon. Charles M. Spofford (Chairman, Council Deputies) ALSO PRESENT DECLASSIFIED - PUBLIC DISCLOSURE / DÉCLASSIFIÉ - MISE EN LECTURE PUBLIQUE LECTURE EN - MISE / DÉCLASSIFIÉ DISCLOSURE - PUBLIC DECLASSIFIED General P. Ely (Standing Group) Vice Admiral Jerauld Wright (Standing Group) Air Chief Marshal Elliot (Standing Group) M. H." Janne. (Chairman, Defence Production Board) Mr. W.R, Herod (Coordinator, Defence Production Board) M. Leroy Beaulieu (Chairman, Financial & Economic Board) Mr. N.E.P. Sutton (Executive Secretary, International Staff) SECRETARIAT M. R.P. Featy Mr. P.P. Roome CONTENTS

Item No. Subject

I . Openining address by the Chairman

II Adoption of the Agenda

III Exchange of views on the World Situation DECLASSIFIED - PUBLIC DISCLOSURE / DÉCLASSIFIÉ - MISE EN LECTURE PUBLIQUE LECTURE EN - MISE / DÉCLASSIFIÉ DISCLOSURE - PUBLIC DECLASSIFIED SECRET •SUMMARY RECORD C7-R/2 ~

I. OPENING- ADDRESS BY THE CHAIRMAN

1. THE CHAIRMAN began by paying a tribute to the work done by the Council Deputies; and in particular their Chairman, Mr. Spofford; it was they who had given the Organisation a kind bf permanent•character, a nd their day to day action was of the greatest value to NATO, Yet the Council Deputies could not fulfil the functions proper to the Atlantic Council at the fninisterial level; and therefore Governments must meet periodically to give directives and to take decisions on political problems which the Deputies or technical' experts could not be expected to solve. For that reason, among others, he hoped that • Council Meetings on the ministerial level would be held in future- more frequently and at more regular intervals:. 3 or 4 times a year, for example. At the same time, it would be desirable to strengthen the powers of the Council Deputies and to widen the frame "work within v/hieh they hod powers of'decision. Thct would help to save time, and to save time was vital,

; 2, The importance of the time factor led him to advocate empirical solutions to certain problems which had perhaps been tackled in-the past months too often from the purely theoretical point of view. The sharing of infrastructure costs was a case in point, A solution of an empirical kind in cases like these could ,sometimes be reached which, while satisfying no one completely, would at least" make further progress possible»-

5, That was the . spirit which he would' like to see applied to certain aspects, of their work, and. he was thinking in particular of the expansion of arms production in Europe, where orders had to be given In some cases as much as 2 years before the date of .delivery here the importance of the time factor could hardly be overestimated,

4, The tasks with which NATO was faced were of exceptional magnitude, but they could be overcome: the whole world was looking towards NATO with hope, and NATO need not doubt the final success pf its efforts. The great achievement of just over a week ago - the signature by 48 sovereign nations of a Peace Treaty with Japan - éhowed^what could be done when a policy inspired by the "NATO principles of respect for right, for justice and for reconciliation was pursued clearly and firmly,

5. Finally, he was sure that none of them doubted that the present session, .like'earlier sessions, would mark an important stage along the path which would in the end enable

DECLASSIFIED - PUBLIC DISCLOSURE / DÉCLASSIFIÉ - MISE EN LECTURE PUBLIQUE LECTURE EN - MISE / DÉCLASSIFIÉ DISCLOSURE - PUBLIC DECLASSIFIED the whole world to feel free from aggression. •

II. ADOPTION OF THE AGENDA 6± MR., ACHESON (UNITED STATES)- said that his Government; •attached great importance to item' VI on the- Agenda (Future Pevelopment of NATO, other than in connection with defence plans). The item appeared rather late In the Agenda, and his Government feared that if it could only be discussed towards the end of a busy session, there might be a danger of hasty conclusions being reached which might afterwards be regretted. He therefore proposed that after the discussion on item III there should be a brief discussion on item VI, at which point he would suggest that a Committee bo set up to prepare recommendations for examination when item VI was discussed at greater length later in the session.

7. THE COUNCIL; Approved the Agenda, subject_to the modification suggested by Mri Acheson.

III. EXCHANGE OF VIEWS ON THE WORLD SITUATION

8. MR. PEARSON (CANADA) agreed with the Chairman in his opening statement that it would be desirable, and hoped that it. would be feasible, to hold Council Meeting's more regularly and perhaps more frequently than hitherto; a minimum of 3 regular meetings annually, for example. This would have the following advantages:

(a) It would make it easier to plan efficiently the- work of the Council.

(b) It would avoid in the public mind the impression that the Council met only to deal with emergencies instead of being what they hoped, it was becoming, a permanent and regular institution for the ord.erIy development and defence of the Atlantic community.

(c) Regular meetings would give rise to less expectation of dramatic decisions emerging'from each session, and the Council would tend to be accepted. • as the normal agency for cooperation and discussion between its members.

He did not imagine that it would be possible or necessary for all the Ministers responsible for foreign affairs, defence and finance to meet three times a year. Representation Governments would depend on the nature o.f the business to be discussed and the special circumstances prevailing in each country.

9. Turning to the international situation, in the Canadian view there had been little, If any, general Improvement, and no easing of world tension since the last Council Meeting. Vfcile it was true that morale in the .North Atlantic countries was higher, in the Far East the aggressive forces of Communist imperialism remained as militant and defiant as ever, while in Vlfestern .Europe itself economic and social difficulties remained DECLASSIFIED - PUBLIC DISCLOSURE / DÉCLASSIFIÉ - MISE EN LECTURE PUBLIQUE LECTURE EN - MISE / DÉCLASSIFIÉ DISCLOSURE - PUBLIC DECLASSIFIED ja constant threat to stability, and one which the forces of Soviet Imperialism were exploiting, and would continue to exploit to. the limit. Further,- if the strictly military picture had Improved somewhat, that, he thought, was due to the realisation by any country tempted to break the peace that the North Atlantic countries stood together in resistance to any such aggression, and that the ground on which they stood was getting firmer. " The moral to be drawn from this was that they should not slacken their efforts, but should, go forward steadily and with determination to complete the job of making themselves stronger.

10. There were, however, two types of aggression to be feared: military aggression expressing itself in armed action, and social and. economic aggression expressing itself through the subversive activities of international Communism acting as the spearhead of Soviet imperialism. The military weakness of the E • • 3 NATO countries by comparison with the strength of the -Soviet armed forces was a standing temptation to Soviet attack, and they must keep working to remove that temptation. But in strengthening themselves militarily, they must avoid weakening themselves unnecessarily in the economic and social field, thereby encouraging the second type of aggression. How to maintain the proper balance in the days ahead between military power, economic stability and social progress w.os probably the paramount problem of the North Atlantic community. It might well be that the Soviet Union, Impressed by the action- of the United Nations in Korea under the determined and courageous leadership of the United States, might now wish for practical reasons to avoid an open conflict and might try to sap their strength by other means. Such a cautious policy by the enemy was more likely to be adopted as NATO military strength grew. He therefore thought it necessary for NATO to take counter measures against this danger as well as against possible military aggression They should never lose a chance of refuting the charge that they were an.agency of war and not of peace, and in this connection they might, during the present session, agree on a strong résolution, emphasising that while they were determined to press forward with their defence programme, yet their primary purpose was to prevent a war and not to fight one. They must get the idea across to their peoples, now more, than ever before, that NATO stood not only for the defeat of aggression, but for its prevention: not only for territorial security, but for greater human v/e If are.

11. They had, in fact, a short-term and a long-term objective, and the long-term objective would require far . greater steadiness of purpose and.morale than the violent effort of the short-term objective. It might well be that if they achieved their defence objectives by the end of 1954, they would have surmounted the most acutely dangerous period; but that might be followed by the long-term phase of the conflict which might last for many- years. If so, they must refuse to yield to the temptation to adopt the policies or even the tactics of those who would destroy them. That is, they must not only maintain, as a normal part of national activity, the level of defence effort required, but also prove to their peoples that the NATO civilisation and the NATO way of life was worth the effort. While concentrating on the immediate danger of military attack, they must realise the positive concept and further the healthy development • of. the enormous potentialities of their countries. If they failed to maintain and improve the living standards of their peoples, it would be difficult to defeat the Communist enemy within.

DECLASSIFIED - PUBLIC DISCLOSURE / DÉCLASSIFIÉ - MISE EN LECTURE PUBLIQUE LECTURE EN - MISE / DÉCLASSIFIÉ DISCLOSURE - PUBLIC DECLASSIFIED 12. He thought that the present meeting of the Council might mark a historic turning point, because for the first time since the Treaty was signed they.would be giving serious consideration to the non-military as well as to the military objectives of NATO. In doing so they were foreshadowing the development of what they were now beginning to call the North Atlantic community. I.t was well that this should be done, ' and that they should begin to plan for the ultimate realisation of that community, long and difficult though it would be to ' implement .those plans.

13. This parallel pursuit of strength and unity, of short-term and long-term objectives, was the very basis of the C7-R/2

NATO association. One way by which it could be blocked and frustrated was through the weakening of the confidence and trust which existed between its members. That could take piece by the feeling, on the one hand, that there was an unequal sharing of the burden of defence, or by a feeling, on the other, that there was an unequal sharing of the burden of existence. Their association together was founded on mutual respect, mutual understanding and mutual aid. In short, it was partnership. There might be stresses on that partnership In the months ahead as they faced such questions as the extension of the pact, the association of Germany in the defence of Europe, ways and means of accelerating and expanding defence programmes, "burden sharing", the utilisation of their growing military strength for diplomacy and for negotiation, and the co-ordination of their foreign policies, both in Europe and in Asia. Meetings such as they were now beginning would lessen those stresses and strains, and, he hoped, strengthen that unity without which none of them could succeed.

• 14. MiR. KRAFT (DENMARK) said that it seemed appropriate, since it was almost two years ago to a day since the Council held its first session,. that he should begin his remarks on the world situation -by recalling the important results accomplished so far and expressing to his Treaty partners on this side of the Atlantic his gratitude for their unique contribution to the common cause, a contribution without which such results would not have been possible. The British Foreign Minister had recently pointed out quite rightly in Strasbourg th^t they could look back upon important, and perhaps decisive, results of the cooperation of the West. The risk of aggression had so far been checked, and the peoples of Europe given new hope. There was an increasing feeling that it really was of some use to make sacrifices in order to prevent,a third world war. But all realised that they had not yet come to the end of the road and that in the near future decisions of great importance for the future of the Organisation must, be taken, decisions which might impose further burdens on their peoples.

15. They must therefore realise that in common - and he stressed the words in common - they would have to shoulder a great and far reaching responsibility. Since the consequences of a country's foreign policy could not be confined to that- country, it was clear that no NATO country could have a foreign policy purely of its own. The paramount goal of NATO was to ensure that the present tension in the world did not lead to a general war. -.If war should break out, NATO policy would have suffered DECLASSIFIED - PUBLIC DISCLOSURE / DÉCLASSIFIÉ - MISE EN LECTURE PUBLIQUE LECTURE EN - MISE / DÉCLASSIFIÉ DISCLOSURE - PUBLIC DECLASSIFIED Ilefeat in the first instance, even though the war led to an allied Victory. Therefore the major political problems of today were of common concern. It was-, however, evident that developments in areas like the Far East, Iran and Egypt were- primarily the concern of the Greater Powers: yet the repercussions of high policy might nowadays • become relevant for any country, and it was therefore of vital importance to all to learn the points of views of the Greater Powers. Any statements which the Foreign Ministers of those Powers might deem it possible to make on such issues would be much appre- ciated.

16. THE DANISHGovernment considered it essential that NATO cooperation should not be confined to purely military matters, but should also extend to the economic and cultural field. This - b -

was laid down in the Pact itself' and had been further developed by the creation of the Council Deputies and by the outspoken exchange of views which took place among Ministers during the Council Sessions. As spokesman of Denmark he v/ished to make his country's situation quite clear. The position of Denmark at the entrance to the Baltic made the defence of that country of paramount importance for the defence of the whole of Western Europe, a fact recognised by General Eisenhower himself. Denmark's exposed position was obvious: the country was small and offered few natural possibilities of defence, whereas the density of population was great and the r Southernmost Danish.isle was less than 30.miles from Soviet occupied territory. Consequently, it was not without hesitation that Denmark had given up its traditional policy of neutrality. It had done so for the following reasons: • (a) Out of the reason' hope that a new occupation of Denmark would thereby be avoided.

(b) In joining the Treaty, Denmark contributed its share to the defence of the West and thus to the- avoidance of a new war.

È It was his impression that Denmark's•contribution was "sometimes underrated. The Danish territory, its Belts and Sounds, were- of major importance in the fight .for the freedom of the seas and therefore for the defence of the whole West, a fact which became manifest during the last war. By coordinating the defence of Greenland with that of the West and the North Atlantic area,. Denmark was in a position considerably to strengthen the defence of that area. Denmark had concluded an agreement on the defence of Greenland with the United States - an agreement in every respect based on existing NATO.plans. The negotiations concerning that agreement were most satisfactory, and a demonstration of the fact that free and democratic nations could, by reciprocal understanding, reach a result satisfactory to both parties, even when one of the parties was a Great Power and the, other a small country.

17. They must build up their forces progressively to the point where a balance of power WciS Securedj but must carefully Pconsider whether any measure in itself liable to increase the risk L of war was really so advantageous from the point of view of PbuildIng up strength that It must be carried out. Moreover, It was essential to realise that any such measure would add fuel to the Soviet propaganda that the Atlantic Pact served aggressive, .and not defensive, purposes. In view of those considerations Denmark was doubtful about the expediency of certain measures proposed in respect of East-West trade, . The continuation, and' particularly the widening of restrictions in East-West trade called for constant mutual surveys of all factors involved. The economic aspect might be discussed later during the session, and he would therefore DECLASSIFIED - PUBLIC DISCLOSURE / DÉCLASSIFIÉ - MISE EN LECTURE PUBLIQUE LECTURE EN - MISE / DÉCLASSIFIÉ DISCLOSURE - PUBLIC DECLASSIFIED Aonfine himself to stressing the fact, that the complete denial of exports to the satelite states would compel them to turn their backs on Western Europe and become more dependent on Soviet Russia, or they would build up their own production capacity. Economic warfare might degenerate into political conflict, whereas commercial relations based on obvious mutual interests had proved one of the best means-of mitigating international tension. The Danish Government emphatically did not wish to make itself the spokesman of a policy of appeasement: strength must be mot with strength. On the other hand, the Atlantic Powers should not embark on a course with the sole object of-securing a strategic ground which would be best on the day when.war might break out. It would not be of• much benefit to the Allies to be able to defeat the Soviet Union thanks SECRET C7^R72 , • , - -S-

to certai n bases and facilities, if the acquisition of the latter ha.d been a concomitant cause of the outbreak of war. The old saying "If you wish for peace, prepare for war" was, when mi sunder- Stoods the most dangerous sentence in the. world.

18. He was convinced that he had just put into words the thoughts and feelings alive in the hearts of the great majority of the Danish nation, whom he represented at the table.

19. M. SCHUMAN (PRANCE) said that he still felt deeply . influenced by the £an Francisco atmosphere, where 48 nations on signing a peace treaty had not only shown their desire for peace, but also their wish to cooperate in the future on a bilateral and multilateral basis with a country with which many of them had recently been engaged in a bitter war; had been"animated that is, by constructive feelings of friendship and not by resentment. jIhe Danish Foreign Minister had just talked of the geographical position of his country: he would also speak of relations with a country important from the point of view of the geographic position of France. That country was Germany. The French Government wanted to work with Germany in a spirit of cooperation and mutual confidenc a spirit based not only on Treaty arrangements but also on permanent institutions which would weld:the two countries together. At the . Council Meeting three . Governments'had been asked to try Ito find an acceptable basis for German participation in the defence • of the Westj the Governments of the United Kingdom, the United States and Fra.nce had been requested to discuss this matter with the German Government. They had been informed that the French Government proposed to call a conference at Paris of those countries including Germany, who contemplated the possibility of participating in a Eiaropean Army.

2 0. The French plan was not to examine the question simply of a German contribution, but to consider the problem on a European basis, including Germany. _ An interim report of the meeting of the 5 countries concerned and of the observers of a number of others had been circulated to participating Governments: .the conclusions of that report had been approved by the French Governmenti and the German Government was ready to accept the main principles'contained in it. Numerous, technical details remained for examination, and ' technical committees had been working on them since the beginning I of September. His Government hoped, that the technical problems Äwould be solved rapidly, so that a treaty embodying the plans for a European Army could be submitted to the Governments concerned in the near future. Tho French Government was anxious to advance quickly in this field, and intended to give the opportunity for a parliamentary debate on the European Army after the Rome Council Meetingj and ho therefore hoped that before the end of the year it would be possible to take a position on the treaty as the basis for a new European institution. What was the basis of that institution? NATO had its integrated armed forces, with a Supreme

DECLASSIFIED - PUBLIC DISCLOSURE / DÉCLASSIFIÉ - MISE EN LECTURE PUBLIQUE LECTURE EN - MISE / DÉCLASSIFIÉ DISCLOSURE - PUBLIC DECLASSIFIED ommand. of a supra-national character. But the NATO armies #smained national in recruitment and to a large extent in the use to be made of them. The European Army was based on the idea of a double integration: integration of command, as in the NATO army, and also integration of the administrative and financial organisation. This represented a striking innovation.

21. Since this question wa.s to be raised, again at Rome and later, he did not propose to go into details at the present stage. He simply wished t"o underline today the importance attached to the conception of the European Army by the United. States, the United Kingdom and France who had just stated in a tri-partite declaration that' they accepted the plan worked out at the Paris Conferonce as being of great value to the. defence of Europe, The United Kingdom - 7 -

Government had stated that it wished for the closest association With the European 'Army at all stages. He was glad to note that statement. . In the Pq st, countries with different traditions had followed different policies, and sometimes opposed policies, in this field. Today, faced by a common threat, a new solution was being tried. The ""concept ion was bold, but boldness was essential if the threat was to be met""and""peace assured. He emphasised that the purpose of the plan was to reinforce1 the prosperity and security'of Europe without prejudice to the essentially defensive nature of NATO. Finally, the European Army would remain subordinate to NATO, a. kind of cell within the greater body. There would be no competition, no dispersal of effort.

22. MR. MORRISON (UNITED KINGDOM) said, that after M. Schuman1s report on the Paris Conference, he would like to speak briefly on the discussion that had taken place at Bonn with regard to the German contribution to the defence of the West. Those discussions had been complimentary to the Paris Conference. The Atlantic Council at Brussels had invited the three Occupying Powers to discuss with the German authorities the question of the participation of Germany In the.defence of the West. The three Powers had therefore instructed their High Commissioners to start discussions with, the Germans on this question. • Those discussions had begun at Bonn in January. The German authorities put forward their views in detail, snd the three High Commissioners did the same. The talks finished in June, : after which the three High'Commissioner s reported to,their Governments. " The" report was""highly technical, relating to the German proposals as to how land, air and sea forces could, be raised in Germany, the cost of equipping them, etc. On the" Allied side, it had been thought"essential to lay dovm certain safeguards to"" prevent the remilitarisation of "Germany and the reemergehce off a German general staff,. The German authorities would not accept1 those safeguards, since in their opinion they would have meant placing Germany in a position of permanent inequality. It was: therefore decided to suspend the Bonn discussion, since they were tending to grow out of line with the Paris Conference on the European Army. As the French Foreign Minister had just said, thQt Conference had proved highly successful, the German ^ Government had. agreed in principle that the German contribution \ to the defence of the West should be made through the European Army. i' The plan was not yet complete, but it was" hoped th°t" it would be ready for""full discussion at .Rome, ,The""Paris plan,' as had been" stated," was based on effecting the German contribution through'a European Army,""rather than through a German national contribution to the forces at General Eisenhower's disposal". He did not intend DECLASSIFIED - PUBLIC DISCLOSURE / DÉCLASSIFIÉ - MISE EN LECTURE PUBLIQUE LECTURE EN - MISE / DÉCLASSIFIÉ DISCLOSURE - PUBLIC DECLASSIFIED to go into details with regard to the Paris Plan,' but his Government considered"th°t the concept of the European Army was a bold and visionary one, vital to all those whose life depended on the preservation of peace in Europe. His Government, therefore wished it every "success and believed that it would ( succeed if it had whole-hearted support. Many administrative • ! details had yet to be worked out, but they could be worked out With the help of technical advice and by being willing to learn"" hy experience. The United Kingdom was anxious to play a full part in the Paris Conference, ang had therefore increased the number.of its observers and had sent a General Officer to the Military Committee

23. Turning to""th'e general situation, Mp. MORRISON thought that progress had. been made since- the last Council Meeting in the containment of the Soviet, but thflt it would be's SECRET . C7-R/2

wrong to be complacent. The evident determination of NATO countries to resist aggression and provide for their own defence had given good results in that there had been no fresh aggression in the purely military sense. In Korea armistice talks were going on, but if: they should prove unsuccessful the forces of the United Nations would continue the struggle with even greater vigour. Next,! there were difficulties in the Middle East which it would be unwise to ignore. Indeed, the "whole area .. . from the Middle East to Jäpan was sensitive: It was an area of ^oung democracies, of great poverty and of Governments far from C, satisfactory in some respects. Appropriate military arrangements and an economic programme in the..Middle East were- therefore matters of urgent importance»

24. The lengthy "and. often tedious talks'among the Foreign Ministers' Deputies in Paris had borne no concrete fruit, but had been nt" least a set-back to Russian propaganda, and marked a complete failure by the Russians to divide the Western Powers.

25. They must make progress quickly in building up their military "strength, but mu-at not leave out of account" economic considerations: the period during"which the West was relatively ve'ak and the Soviet strong'was a dangerous one, and"the sooner it • vas"passed the better. For "this, good leadership was vital. The morale of Western Peoples was a consideration which must always be borne in mind., if those peoples were not only to be ready, but even to take pride in making sacrifices today in order that peace might- be ensured for the future. This conviction"~could only grow in them through bold leader sbl t>, through education, and through a propoganda which would emphasise the fact that the defence effort"was called for in the interests of peace." The military programme .could not be carried through without a high morale .

26. There had"boon indications in the last few months that~~the Soviet propoganda1 line was becoming more conciliatory. It"'~wns proper to be contlnuaily~"on the look-out~~for a real change of heart in the Soviet, and to try to reach an understanding th Russia If the change"~of heart took""pl-ace . They must be Äequally caütious~"with~~rega.rd to conciliatory moves for tactical ^purposes,"aimed at" weakening the defence effort of the West. The ^Soviet pea ce" "campaign was still in full blast, but Stalin's remarks as far back as 1924 should not be forgotten: they were to the effect that the object of. strategy was to gain time to demoralise the enemy and to accumulate forces by which the enemy could later be defeated» It was near the truth to say that the dictator needed an enemy, to keep the minds of the people over wliom he ruled away from their internal difficulties.

27. In conclusion, he would urge the Organisation to

DECLASSIFIED - PUBLIC DISCLOSURE / DÉCLASSIFIÉ - MISE EN LECTURE PUBLIQUE LECTURE EN - MISE / DÉCLASSIFIÉ DISCLOSURE - PUBLIC DECLASSIFIED Äjarry on in the -future as they had been doing in the past, with ^fche object of avoiding war and "of containing the Soviet. Care "and patience were necessary if a third"~v/orld war were to be avoided," arid the West should never be afraid to negotiate when, there was a fair chance that negotiations "would be" fruitful. It was also important to set on foot a peace campaign proper to the West. Let the West" go ahead with energy and with circumspection: firmly, but with restraint. If th'ey did this, they could -weather the difficult period, and could reach military equality. When that stage was reached, the position could be reviewed to see whether real peace could be brought nearer. SECRET C7-R72 -9- ;

28. MR. ACHESON (UNITED STATES) spoke first of the general situation, which depended essentially on the problem of co-existenco with the Soviet Union, and derived from the nature of the' Soviet power system on the one hand, and the overall world position on the other. For 5 centuries the world'has been familiar with certain aspects of the Russian sjstem: a small ruling class dominating a docile and hard-working population: a continental land mass, small in size originally, but expanding continually East and West, North and South: finally, intense sensitivity with regard to the vulnerability of its frontiers. The world had experienced no undue trouble until a new element was introduced in the 1917 Revolution, Then, a conspiracy gained control of a State without losing its characteristic of conspiracy. The new conspiracy-state was deeply affected by doctrine, and the important points in the doctrine weroï

(a) For domestic consumption, emphasis on the Insecurity of the internal position

(b) the inevitable triumph in the inevitable conflict' I with capitalism.

29. The expansionist policy of the Soviet was now the more dangerous In that the last war had removed two military empires which, however evil in themselves, had at least contained Russia, The rest of the world was in consequence weakened. There had followed a crisis of will, loading, in many countries, to neutralism, as the natural and inevitable result of the enormous efforts made during the war. Then there were the Middle East and Far East countries, inflamed with nationalism, whose leaders tended to use the West as a'scape-goat in the eyes of their own peoples .to turn attention away from their own inadequacy. As a last factor, the Western powers, which had created stupendous 'Oilitary forces to defeat Germany and Japan, had demobilised those forces when the two military empires were destroyed. Thus hp face an expansionist Russia there was a world weakened by wie defeat of the two containing military empires, by its own pprvous exhaustion, and by the demobilisation of its own forces.

30. In its expansionist policy since the War the Soviet had followed two courses:

(a) Exerting pressure East and West to expand its frontiers.

(b) Playing on the weakness to the West to achieve

DECLASSIFIED - PUBLIC DISCLOSURE / DÉCLASSIFIÉ - MISE EN LECTURE PUBLIQUE LECTURE EN - MISE / DÉCLASSIFIÉ DISCLOSURE - PUBLIC DECLASSIFIED ^ both its immediate and long-term objectives.

31. With, these two courses in mind, the Soviet in""the Dast five years attempted to keep Ge'rmany weak, to""keep Japan veak, to split Korea a.nd use: it as a" constant threat, to divide ;he Western Powers and the United Nations, and. to advocate a form Df disarmament which would, deprive the West of "the value of ""it s Industrial potential while leaving-the Soviet armed forces at full strength.

32. The policy of the West during those years was based Dn three objects:

(a) To rebuild the economic and social structure of Europe. ' - 1® -

(b) To restore the whole counterrbalancing powers, Germany and Japan, "to their true place by means of an honourable peace.

(c) To turn the new forces In the Middle East and A3Ia to constructive rather than to destructive purposes, and to remove : them from the Soviet orbit.

33, The policy of economic reconstruction in Europe had proved successful." The West" then had to think in terms of defence, which became necessary in view of the disparity in the" armed forces, and through NATO considerable progress was made in this field. The problem in the Middle and Far East was very diff Icult :"': no organised States could be said to exist, no State" with a; common interest other than hostility to the West. China, was löst, due more to the suicidal folly of the Chinese Government than to any Machiavellian strategy on the pnrt of Russia:. There "w° s still going on a major war in Korea, Indochina and Mai'aya, and serious troubles in the Philippines" and Indonesia. .The counter-measures of the 1'Vest had~"been"taken: in Korea the front was being held, a peace treaty""had been signed with"Ja.pan, and the United States, New Zealand and Australia had entered""into their joint Pacific undertakings. All this me^nt the creation of a bastion in the Far. East, round which stability could be built.

34. The most important factor in the Par" East from the NATO^point of view, was thnt "it could be used as a test of Soviet intentions. Tf Russia really wanted it, much of the trouble in the Far "East could be brought to an end very"" quickly. Russia was.as aware as the West of the real danger th«t the Korean war might1 explode into something- greater s yet Kaesong seemed to show ll'ttle~"real desire on the part of the Soviet.to end the Korean war, "though the possibility that""the Soviet could not bring all the pressure to bear on China that it wished should not be underestimated.

"35. In the"Middle East, the problems were largely, due to agitations' ^rising out - of «n inflamed nationalism and to the" fact that the peoples" were badly governed and exploited, . . with a tendency for their: leaders to use the West as a scape- goat to hide their own inefficiency. Patience and firmness combined might make it possible to overcome these difficulties.

36. The""Middle Ea^st nnd Far East were, very important to the NATO area, since if the Soviet could weaken the""West in those two areas, It would' strengthen its" position vis-a-vis NATO in the West. It w°c therefore vitally urgent to strengthen NATO in the West ®nd the North Atlantic". , One important way DECLASSIFIED - PUBLIC DISCLOSURE / DÉCLASSIFIÉ - MISE EN LECTURE PUBLIQUE LECTURE EN - MISE / DÉCLASSIFIÉ DISCLOSURE - PUBLIC DECLASSIFIED of Qchiev"Ing""thnt wQs by bringing Germany into the""defence""of the West as a self-respecting "Associate. M. Schuman in that connection had . talked of the Paris Conference, Mr." Morrison of the Bonn discussions. He wished to report on a third essential element, the new nnd proper status to be given to Germany if it-was to tnke| its p°rt in'the defence of the West.

37. The Governments of the Occupying Powers had asked their High Commissioners [to make recommendations on this point.- After discussion with the> German authorities, those recommendations were made and were carefully examined at the 'recent Washington meeting. He wished to m^ke the following' statement, with the n consent- and approv l of M. Schuman and Mr. Morrison:

" We Believe tha.t"~the three governments must" retain a supreme1 authority in Germany to deal with the situation ^rising through the division of thBt country and the fact that the federal republic is confronted by a security menace from beyond its borders and beyond its control.

Broadly speaking; this would mean thqt the authority would be exercised for only three purposes: to discharge Allied responsibilities regarding Germany as a whole,. Including unification""of Germany and the~"final peace settlement; to deal with questions relating 'to Berlin; nnd to station forces in Germ°ny and to protect the security of those forces.

In all other fields, however, problems "arising from the war or the occupation would be treated in agreements between the three government s and the German government. The German obligations expressed in these agreements would take the place of occupation controls, °nd no,, authority would be retained to super- vise the policies "of the Govern government or (except in a situation of crisis and for the protec- tion "of the security of our" troops) to intervene in Its activities. The occupation statute would be repealed and the i High""Commission terminated. The allied troops in; Germany would become defence forces, r°ther than occupation forces,""and relations between the three powers nHd the ""federal government would be conducted through ambassadors.

We consider thqt these arrangements are in the interest- of the Germans ag well"ag of the Western powers," and we hope "thPt they may establish""a firm political basis for the association of the federal republic with the defence of the west ang for" its relations with the free nations which can be maintained until a peace settlement with a unifiod Corracny becomes possible. It" is proposed that the arrangements be expressed in an Agreement on General relations with the Federal Republic, to be accompanied by related agreements on particular subjects, such as basic security safeguards, the status of forces' in Germany, the logistical and financial support of these forces, and certain other matters. i

DECLASSIFIED - PUBLIC DISCLOSURE / DÉCLASSIFIÉ - MISE EN LECTURE PUBLIQUE LECTURE EN - MISE / DÉCLASSIFIÉ DISCLOSURE - PUBLIC DECLASSIFIED The High Commission Is about to open negotiations with the Federal•Republic to reach agreement on the proposed arrangements. ^ further report will be made to the Council after these negotiations have been concluded".

Finally, he wished to stress two points in particular:

(a) The new arrangement' in respect of "Germany, the three Powers were all agreed, WnS to accompany agreement on the,European -rmy. He wished to add his voice to the ; observations of Mr. Morrison in C7-R/2

this connection:, the United State's gave its whole- hearted support to the idea 0f ° European Army, which it regarded:as the best way of ensuring Germ°n contribution to the Defence of the West and the best wny, °s a complement to the Schuman Plan, of achieving a strong and united Europe.

(b) The-United States agreed thoroughly "that it was vitally important to maintain standards of living, Qnd was therefore anxious to push on with the non-military activities of NATO. But there w°s no question In his Government's" opinion of a choice or a conflict between maintaining standards of living and the military effort. Both,""as a matter of urgency, must be taken in hand at the same time. The NATO community w5s gaining strength, and the West would soon be defensive; but it must be made defensive:expeditiously. It was on that note of urgency and expedition thnt he wished to close. i

THE COUNCIL""adjourned at 6.30 p.m., fixing its next meeting for continuation of the discussion of item III on the Agenda for 9.0 p.m. that night. DECLASSIFIED - PUBLIC DISCLOSURE / DÉCLASSIFIÉ - MISE EN LECTURE PUBLIQUE LECTURE EN - MISE / DÉCLASSIFIÉ DISCLOSURE - PUBLIC DECLASSIFIED