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United States Department of State / Foreign relations of the United States, 1948. Germany and Austria
(1948)

VIII. The efforts of the United States to assure the maintenance of the independence and integrity of Austria,   pp. 1352-1446 PDF (37.7 MB)


Page 1445


AUSTRIA
1445
dangering present rate economic progress? Can agreement be reached
with Brit and Fr High Commissioners on joint favorable action this
matter? Have Sovs collected occupation costs for -this year?
   Dept-would appreciate receiving recommendations soonest.
                                                             LovETT
 740.0011 EW (Peace) /12-1948: Telegram
     The Minister in Austria (Erhardt) to the Secretary of State
 SECRET                           VIENNA, December 19, 1948-2 p. nm.
   1303. Deptel 919 [922], December 8.1 Following considerations seem
 most important in deciding position US element on occupation costs.
   (1) Quadripartite ,approach most desirable if agreement sub-
 stantially to reduce burden on Austrian economy can be reached.
   (2) Austrian Government would have extreme difficulty meeting
 occupation costs 1949 and could probably do so only (a) by levying
 new "occupation tax" which would have harmful political repercus-
 sions or, (b) by cutting out certain essential expenditures now
 provided in "ordinary budget". ('Expenditures contemplated "extraor-
 dinary budget" can presumably be made only by release ECA counter-
 part schillings.)
   (3) Soviets, unlike British and French, have not repaid currently
 from m'litary occupation funds advances made by Austria for civilian
 occupation costs (rents, etc.) and are now in arrears 194 million (of
 Which 85 incurred this year) for these advances. Agreed principle
 equal treatment for occupation powers therefore violated in practice.
   (4):As of last June three powers had schilling bank deposit total-
ling '738 million plus allotment of 45 million for 1948 occUpation costs.
These amounts presumably somewhat reduced now but obviously very
large schilling advances still available to three powers.
   (5) Established practice of A1C is to reduce occupiation levy progres-
sively each year. For this principle to be effective 1949 imay be neces-
sary to abandon practice basing levy on percentage Austrian budget
and lso to determine costs quarter by quarter rather than for entire
year.
   (6) In view large US contribution to revival Austrian economy and
high, interest in Austrian financial st'ability, US has substantia,1 con-
cern in reducing occupation costs to minimum.
  In light these considerations US authorities Vienna intend pursue
following course: (a) discuss informally with British and French
(-who have already raised question with USFA), stressing six sug-
gested lines above; (b) avoid taking initiative, but express willingness
discuss question quadripartitely whenever invited; (c) endeavor reach
quadripartite decision reducing substantially burdens occupation
costs along lines indicated paragraphs 3,4 and 5 above; (d) reconsider
position if eventually confronted with alternatives either blocking
  %&upra.


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