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

IX. United States participation in the negotiations for an Austrian treaty,   pp. 1447-1535 ff. PDF (34.1 MB)

Page 1455

assumption of obligations to Soviets which results in economic integra-
tion of Austria in East European bloc. Similarly, no agreement can
be accepted which involves redemption of cash obligation by US Govt
or Austrian debt to Soviets beyond Austrian capacity to pay within
reasonable period.
   Re para 5 Embtel 313 please assure FonOff US seeks definite settle-
 ment which is consistent with all international agreements respecting
 Austria. US genuinely interested in obtaining a satisfactory settle-
 ment and conclusion treaty permitting full exercise Austrian sovereign
 rights. We remain skeptical motives behind Soviet action in submitting
 proposals until these motives are displayed in course negotiations. We
 will not prolong negotiations on percentages of property interests if
 there is no apparent hope for settlement on all treaty issues, thus per-
 mitting Soviets to shift onus on Western States for failure to obtain
 740.00119 Control (Austria) /2-548: Telegram
     The M    siniter in Austria (Erhaardt) to the Secretary of State
 SECRET    URGENT                 VIENNA, February 5, 1948-2 p. m.
   130. Following are comments on possible Soviet motives in sub-
 mitting new treaty proposal.
   If objective is merely vto prolong negotiations and shift onus to US
 for failure to reach settlement, question of Soviet motivation presents
 no problem. Soviet tactic of delaying final decisions -through this
 means would seem wholly plausible pending clearer view of results
 ERP and US election trends.
   If, however, Soviets now, actually wish to reach early settlement,
fundamental alteration of strategy is involved, and new conception
of Soviet moltivation called for. May be noted in passing that.Gruber
is inclined to consider offer genuine ,and to characterize it ,as first step
in major shift in Soviet policy which he believes certain to result rela-
tively 'soonfrom ERP (if carried through effectively) and from over-
all US policy-of firmness.
  Whether or not one accepts this optimistic view of broad picture,
there can be no doubt Soviets have suffered substantial political losses
in Au'stria in past year. Soviet Union has become increasingly odious
to mass of Austrian people; Communist Pa&rty continues insignificant
faction'; USIA   (Administration of Soviet Enterprises in Austria)
firms, mismanaged by Soviets, starved of raw materials by Austrians
and with equipment rapidly obsolescing, have certainly proved less
profitable than was anticipated; US aid continues to have increasing
economic and psychological effect; Austrian leaders, encouraged by

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