NOTICE
This is a transcript of a tape-recorded interview conducted for the Harry S. Truman Library. A draft of this transcript was edited by the interviewee but only minor emendations were made; therefore, the reader should remember that this is essentially a transcript of the spoken, rather than the written word.

Numbers appearing in square brackets (ex. [45]) within the transcript indicate the pagination in the original, hardcopy version of the oral history interview.

RESTRICTIONS
This oral history transcript may be read, quoted from, cited, and reproduced for purposes of research. It may not be published in full except by permission of the Harry S. Truman Library.

Opened February, 1976
Harry S. Truman Library
Independence, Missouri

[1]

MCKINZIE: Could I ask you to narrate something about your experience with lend-lease settlement? How did you happen to become involved? More specifically, how was it done?

MATLOCK: As an officer of the Foreign Economic Administration I participated in the administration of lend-lease during the last two years of World War II. I was especially involved in lend-lease transfers to the United Kingdom and British Commonwealth, and to the Soviet Union. The hard work was done by the area offices for those areas, but for a

[2]

considerable period the chief of the Bureau of Areas deputized me to approve requisitions for him. In that way my initials became the penultimate set on the lend-lease requisitions as they went on their way to Treasury Procurement for implementation.

After victory in Europe, the Administrator put me on a committee, largely of staff people, called the Lend-Lease Termination Committee. It was chaired by the Administrator or his deputy. Late in 1945 I was virtually instructed to go into the State Department on detail to work on the British settlement. We had done much advance work in FEA. In March 1946 we concluded the United Kingdom settlement, which established the pattern of principle for all settlements. I remained in the State Department. I hasten to add that it was not possible to apply principle in any detail to all settlements, and also that I did not participate in all settlements.

[3]

MCKINZIE: Could you tell us about the people you worked with, and how you proceeded in the matter of the British lend-lease settlement?

MATLOCK: There were two levels of representation. In present usage they would be called ministerial and official. I was at the official level, acted as part of the combined secretariat (to produce combined minutes), and participated in the negotiation of the subsidiary agreements of March 1946 which gave detailed effect to the principal Memorandum of Settlement agreed, if my recollection is correct, on or about December 5, 1945.

Under Secretary of State Will Clayton and Judge Fred M. Vinson headed the U.S. delegation. Lord [John Maynard] Keynes and Sir Henry Self (U.K. Treasury) headed the U.K. delegation. Sir Frank Lee (the knighthood came later) and Hubert Havlik headed the British and U.S. official level delegations, respectively. The extensive subsidiary agreements were negotiated at the official level. I am sure that you have access to the records of

[4]

negotiation which would give you the names of the others who participated in the negotiation.

Hubert Havlik and I had both engaged in the preparatory work in the Foreign Economic Administration. Among other things, we had worked out with the British an agreed definition of civilian inventory, a definition crucial to the settlement, inasmuch as nothing else was charged for. Articles delivered during the war were not subject to compensation if they were "lost, destroyed, or consumed" in the war. "Pipeline" deliveries made after the termination of lend-lease were paid for.

There were a number of loose ends to the British settlement, anticipated in principle but not in detail, which were taken care of in a "settlement of the settlement" about a year after the March 1946 agreements. I had moved on to other work and did not participate.

MCKINZIE: When one worked on lend-lease settlement, obviously there had to be some kind of goal that

[5]

settlement was to produce. There had to be something beyond simply coming to grips with the legalities, and I understand that there was some attempt to leave Britain, as a result of the settlement of lend-lease, in a position where postwar recovery would be enhanced or at least not hindered.

MATLOCK: That certainly was on my mind and Hubert Havlik's. We were not lectured on the point, but it was a common understanding that the British were up against the wall financially. This played a part in the broad perspective of settlement, for example in the decision not to ask compensation for the military lend-lease inventory. Within the established framework of settlement principle, however, we negotiated hard for adequate compensation.

Several years before, probably 1942, I had worked with Eleanor Dulles, Louis Bean, and others in the Office of Economic Warfare on the task of estimating the U.K. prospective balance of payments

[6]

in the first year after the war. It was an inter-departmental effort, and I think we made a good guess. The fact that we tried to assess the U.K.'s postwar financial position shows that there was U.S. official interest.

MCKINZIE: May I ask what you perceived that postwar position to be? Was it a restoration of Britain as the predominant world international trading power?

MATLOCK: No, there was none of that in it. It was just a matter of British survival. The U.K. was in a tough spot and needed consideration to avoid breakdown. The last sharp issue negotiated on the evening before the December 1945 memorandum was agreed was the issue of convertibility of the pound sterling. U.S. insistence prevailed, and the U.K. agreed to the maintenance of convertibility. The condition was too severe, however, and the U.K. had a convertibility crisis in 1949 and, as I

[7]

recall, devalued the pound. At that time, the U.S. heartily approved of the devaluation.

MCKINZIE: Did you or Havlik talk about the repercussions of convertibility?

MATLOCK: We were aware of the problem, but it was not our task to determine the U.S. position or to negotiate the issue. The Treasury Department, headed by Judge (Secretary) Vinson, was seized of the question. The negotiation was at the top level, and the issue was decided in the last hour.

MCKINZIE: I would like to get at the economic outlook of people in the State Department in 1945 and 1946. The British contended in early 1946 that they required something like 6 billion dollars in order for them to transform their economy from wartime and then to make the conversion and to repair the damages of the war and to reestablish themselves in the postwar system. They asked for 6 billion and they got something like 3.75 billion. Now, is

[8]

it illogical to say that it either takes 6 billion or it doesn't, and that you can't rebuild a torn down house for a little over half?

MATLOCK: I think your metaphor has no utility for the purposes of this discussion. To talk about a torn down house implies a simple concept and known quantities. The U.K. economic position -- like the U.S. economic position in 1975 -- was complex with thousands of variables. It would be much more appropriate to talk about the total U.S. expenditure required to prosecute the cold war successfully for a period of five years, or in the present era the amount of tax rebate required to restore prosperity in the U.S. without generating inflation. No one knows the answer.

The U.K. needed funds and had to frame their loan request in terms of their estimates of need and their estimates of probable U.S. reactions to the request. A figure was negotiated -- a figure that was possible and practical in the circumstances

[9]

of the negotiation.

The U.K. settlement obligation ran for 30 years at 2 percent interest. The loan provided the U.K. with immediate resources and was also, as I recall, payable over 30 years at 2 percent.

MCKINZIE: What kind of information or order, and what feeling of awareness did you have from the Secretary of State at that time?

MATLOCK: To the best of my knowledge, Mr. Clayton handled the whole matter with full delegated authority from the Secretary. The buck stopped with Clayton. When it came time for signature, Acheson signed for the U.S. and Lord Halifax for the British.

The December 1945 Memorandum was directly negotiated by Clayton and Vinson. I believe that Acheson was also involved in the final stages. The Memorandum was drafted partly at the top and partly at staff level.

The subsidiary agreements of March 1946 were

[10]

negotiated at official level. On the U.S. side, the final drafts were reviewed by Mr. Collado for Mr. Clayton, and approved by Mr. Collado before they were approved by Mr. Clayton. Most of this was last day activity.

MCKINZIE: How was the negotiation with the French different from the negotiation with the British in terms of purposes and also kinds of people?

MATLOCK: The U.K. settlement was the big deal. The British got 31 of 54 billion dollars total lend-lease. The U.K. requisitioned all of it and received about 27 billion for its own war needs. The other 4 billion went to British Commonwealth countries. Principles of settlement were worked out in the British negotiation.

The French situation was quite different.

MCKINZIE: In their own way the British were in more desperate straits?

[11]

MATLOCK: Perhaps so. I don't remember making that particular comparison. We addressed the French situation on its merits, got the most equitable settlement we could get, and extended substantial assistance through Export-Import Bank loans.

As in the British settlement, there were two levels of negotiation. We had the same top people -- Clayton and Vinson. The top French negotiators were Blum and Monnet. Henry [Harry] Labouisse had charge of our second level French War Settlements Committee. I was secretary, or something like that. Valensi was the official level French chief, opposite Labouisse.

There were some thirteen agreements which the principals signed in an elaborate ceremony covered by newsreels in the famous old press conference room of Old State (now called the Executive Office Building of the White House).

The French approach to negotiation was distinctly different from that of the British. The French preference for logic and principle

[12]

was evident; of course they chose their own premises. The British were pragmatic. They wanted an acceptable deal, as much to their advantage as possible, as in the French case, but the British were not interested as much in the rationale. If the deal was okay, the rationale was of secondary importance.

MCKINZIE: Could you address yourself for a moment to meetings you attended dealing with the attempted lend-lease settlement with the Soviet Union?

MATLOCK: The Soviet Union thought it didn't owe us anything. However, they did come to a couple of meetings - I forget the number. Harry Labouisse was our Chairman and Arutunian [spelling uncertain] was the Soviet chief of delegation. He was the principal economic officer of the Soviet Foreign Ministry. George Truesdell was secretary of our side. Aside from opening the subject, nothing was accomplished.

Later on there was another committee of which

[13]

Robert Hooker was chairman. I was a member. The task of the committee was to secure the return of three icebreakers and 27 or 28 frigates. An admiral represented the Soviets. That negotiation was successful and all but one of the vessels (a wrecked frigate) was returned.

I have not been involved since then. It is my belief that nothing much happened until recently when the Soviet Union did agree upon a lend-lease settlement as part of a package deal involving trade and credits. When the package fell apart, the Soviets (according to the press) again rejected any liability for lend-lease settlement.

MCKINZIE: Could we go back to 1945 after VE-Day and President Truman's decision to stop lend-lease?

MATLOCK: At that time I was involved in the line of approval of lend-lease requisitions, but did not participate in policy decisions.

[14]

MCKINZIE: Did you hear any discussion about why Leo Crowley told President Truman or convinced President Truman to cut off lend-lease?

MATLOCK: I never knew that it was Crowley's idea; only that he favored it. I understood that Will Clayton would not have let it happen if he had been in the U.S. But he was in London and the decision was apparently made without his participation. There was a good deal of feeling at the time that lend-lease should not have been terminated so abruptly. If lend-lease had been continued for a time, it would have in some measure anticipated the Marshall plan and would have helped with the "interim aid" problem, as well as complementing the "aid in the wake of battle" which the armed forces could give.

MCKINZIE: How well and by what means were you able to keep your hand on the pulse, so to speak, of European economies through the years 1946 and 1947? This is my way of asking whether or not

[15]

and at what point you recognized that there was some kind of serious problem in Europe that was going to have to be dealt with?

MATLOCK: Our diplomatic missions in Europe were reporting regularly on the conditions in the European countries, as were our occupation authorities in the occupied areas. In the State Department, the Office of Financial and Development Policy, a part of Mr. Clayton's organization, regularly considered the economic horizon around the world. Paul Nitze and several others in Mr. Clayton's immediate office had a perspective of the problem and were a brilliant group. From that, following "interim aid," emerged the Marshall plan.

MCKINZIE: From your vantage point in the Department of State, there was no particular warning that a grave European problem was evolving?

MATLOCK: My work was on lend-lease settlements and surplus property disposals. I attended staff

[16]

meetings which brought all factors together, and the settlements had to take account of the other countries' economic or financial capability for settlement, but the question you raise was not front and center. I do not remember an atmosphere of crisis when the Marshall plan was proposed, and you will recall that it took about a year to get started after it was proposed.

However, the question of the gravity of Europe's postwar economic position had been under prospective consideration by the U.S. since the middle of the war. The question was not whether there was a problem, but what to do about it. Some form of aid was continuous from the end of hostilities up to the end of the Marshall plan (which was completed ahead of schedule). The mention of military and defense considerations was taboo in connection with the Marshall plan, but after the Marshall plan was over, renewal of economic aid came with NATO under the label "defense support."

MCKINZIE: Could you tell how you became involved with

[17]

the work of the Marshall plan and before that with the Greek-Turkish aid program?

MATLOCK: I had little to do with the Marshall plan except for some staff responsibility in the period before the formal operations began. George McGhee and Harry Labouisse were co-chairmen of the Inter-departmental Committee for the Marshall Plan (or some such title), and inasmuch as I was a special assistant to McGhee and available, I was assigned to the job of secretary to that committee. I forget whether there were two of us, but there may have been. I was never a part of the Marshall plan organization, either in Washington or in Europe.

My connection with the Greek-Turkish aid program arose from my earlier acquaintance with George McGhee. Before I joined his staff, he was at one time (early in 1947) in need of help on a negotiation with the U.K. I took time off from other work to negotiate for him the agreement with the U.K. transferring financial responsibility

[18]

to the U.S. from the U.K. for aid to Greece. It was probably the first "off-shore procurement agreement," as it provided for the purchase of certain supplies and equipment from the U.K. for Greece. I believe you could find it under the heading "Marshall-Balfour Agreement," after the men who signed it.

Later that year I transferred to McGhee's staff. He was the Coordinator for Aid to Greece and Turkey and reported to the Secretary and Under Secretary of State. [Matlock, shortly after Truman's pronouncement of his "Doctrine" and "in support of the Truman initiative in world leadership," drafted an American Credo, a copy of which, with pertinent documents, is appended to this transcript.]

MCKINZIE: When you worked for George McGhee, were you not involved in political and economic considerations of the highest order?

MATLOCK: Yes, to be sure. McGhee's job was high policy and top program administration. As his "Special assistant for Interdepartmental Relationships," my work was on military aid to both countries. I worked closely with the Pentagon.

[19]

MCKINZIE: You presumably attended some meetings in which the Secretary of State was present?

MATLOCK: Yes, I often accompanied McGhee or his deputy, Walter Wilds, to such meetings.

MCKINZIE: Were you present at the Secretary's meeting for briefing General James Van Fleet prior to his departure for Athens to assume command of the U.S. Military Advisory Group?

MATLOCK: Yes, and it was a most interesting occasion. Some generals and colonels from the Pentagon had come over for the meeting, and it was a good civilian-military mix. Two things about it struck me as interesting and significant. The first was that the active generals still regarded Secretary [General] Marshall as the "old man," and were ready to follow his guidance without interdepartmental scuffling. The second was Marshall's comment to Van Fleet that the latter should bear in mind that the U.S. was not prepared to go to war over Greece. That information was of course crucial to the

[20]

way in which Van Fleet approached his job -- at least that is my view. I do not know whether Marshall was making policy when he said that, or was repeating a point he had agreed with the President.

MCKINZIE: The problems that later came up in the European Recovery Program were in a sense all dealt with before in the Greek-Turkish aid program...

MATLOCK: There was no economic aid to Turkey. Also, Turkey needed development, not recovery. So rule out Turkey.

Greece was a different matter. It had in its program military aid, budgetary aid, and development aid. The middle category is intended to mean what "defense support" later meant. So I would say you are correct in the case of Greece.

You will recall that Turkey did not participate in the first year of the Marshall plan.

[21]

After that it was drawn in.

MCKINZIE: In Greece there was a question of what the distinction should be between development aid and defense support. This same thing became an issue in Europe after 1949-1950, particularly with the advent of the Korean war. Since you did deal with the Pentagon aspect, I am wondering if you were aware at your level of this dispute about what portion of available funds should be spent for military aid and what should be spent for economic development?

MATLOCK: Achievement of balance among the several components of a program, both as between economic and military, and within each of the two, is a continuous problem that generates strong views among the proponents of the several elements. I do not recall a program that didn't have stresses within it. In order to comment on your question at length, I would have to know whom you have in mind. I worked in a staff capacity with the

[22]

people at the top who had to put the whole program together and achieve a balance with due regard for need and policy priority. I did not make the decisions; I contributed to them.

MCKINZIE: At the staff level was there any discussion about whether the action taken in the Greek crisis was appropriate? That is, would it have been more appropriate to have resolved the problem within the framework of the United Nations. There were critics at the time, as you know, who contended that unilateral U.S. action in the case of Greece and Turkey dealt the United Nations a lethal blow...

MATLOCK: I do not recall our having to contend with any forceful criticism of the kind you describe. The question was whether we should relieve the U.K. of its burdens in Greece, which the U.K. said it could no longer carry, or the Greek struggle should be left to write its own ending. The U.N. didn't really enter into it.

[23]

Bear in mind that the U.N. did not have then, as it does not have now, the unity and resources to determine the outcome of a civil or other war. The U.N. was built upon the premise of unity and agreement among the permanent members of the Security Council, in which all enforcement powers were vested. The policies of the Soviet Union, and the opposition of ourselves and our allies to them, made such unity and agreement impossible and precluded the success of the U.N. as a peacekeeping agency from the outset. The U.N. idea was good, but world conditions made it impractical. Granting full credit to various U.N. agencies that are doing useful economic, social, and humanitarian work, there has never been a U.N. capability for resolving a military conflict. There was no way to resolve the Greek struggle in favor of the non-Communist side except for the Greek Government to win the war.

[24]

The U.N. is not an "it." The U.N. is a "we." If WE the great powers in the U.N. cannot agree, there is nothing the U.N. as an IT can do to resolve our differences. The U.N. provides a forum, a place to meet, a sort of international grand hotel. If we are fighting the Soviet Union, or contending with it, if you prefer a different expression, we can keep the contention out of the U.N. or move it in, but the resolution of the conflict will not depend upon whether the contention is outside the framework of the U.N. or housed within it in some sense. The steps we and our allies took to bend the U.N. Charter to give the General Assembly some policing powers in such a situation as developed in the Congo, or as now exists in the Middle East, does not in my estimation alter the above conclusion.

Although the British were clearly hurting and in no position to continue in Greece in 1947, it was my impression that they thought having the Greek problem as our own would wake us up a little

[25]

and get us committed to the struggle against Communist domination of the world.

MCKINZIE: Did the British official ever intimate that to you?

MATLOCK: Not directly. However, on more than one occasion officials of the U.K. or Commonwealth countries, pursuant to the general U.K. line laid down by Churchill in his Fulton, Missouri speech, stressed to me as to many others that the U.S. and the U.S. alone could block Communist domination of the world. There was, before our commitment in Greece, an air of British impatience about our slowness in realizing our manifest destiny in this respect.

The U.K. estimate that the U.S. was the only country that could block Communist world domination, a 1947 line, was confirmed in a measure by the Soviet estimate at the party conference in 1952 in Moscow that the main problem was to isolate and reduce the U.S. They have made considerable

[26]

progress in their efforts to do it, helped, of course, by circumstances they did not contrive. Now, of course, world communism is subdivided badly from the Soviet point of view, and the demise of the U.S. would leave a fundamental conflict of intentions between the Soviet Russians and the Communist Chinese. The world might be Communist, but not unified.

MCKINZIE: I am concerned about the administration of the Greek-Turkish program, and about the difficulty that came up there before it came up in the Marshall plan or the Technical Cooperation Program: the compliance control regulations, the strings, if you will, that are attached to systems and which amount to willful intervention in the internal affairs of a sovereign nation. This may have been done with a willingness, with invitation of the Greek Government. Was that a large issue for you who were working on this problem?

MATLOCK: It was a problem more than an issue. The

[27]

Greek Government at that time acted in full cooperation with the U.S. Government. The Greek Government was desperate and badly needed the administrative help it was given in administering itself. I remember an American or two who were Greek Government officials in a functional sense. The U.S. idea was to deliver the aid, see that it was used properly and effectively, support the main objective: win the war. In Greece it worked. Look at Greece in 1975: Is it a puppet of the U.S.?

In point of fact, the U.S. has often had little ultimate say in the affairs of countries to which it has been most heavily committed. The leaders of the countries involved have always realized that the U.S. became involved with them because of a U.S. interest and has little choice. This gives the other countries' leaders considerable latitude for maneuver.

In Greece we did not have the intense conflicts of will that sometimes characterized our later wartime relations with the Koreans.

[28]

You characterized our action as intervention in the "internal affairs" of a "sovereign" nation. A Communist "war of liberation" which the Soviets and the Chinese still and will support, is never an "internal" affair of a country. It is international from the start, and may be international in its conception and origin, i.e., actually imported. "Sovereign" means having power and from it free choice. What we did in Greece was to ensure the sovereignty, at least for a while, of the non-Communist Greeks (of many political persuasions) in their own country.

The sovereignty of a government fighting a foreign supported rebellion or revolution is inherently abridged. The Greek Government's position in its fight to reestablish and preserve its sovereignty was made exceptionally difficult by the existence of the Yugoslav sanctuary for tired or beaten Communist troops. The Greek Government began to win when the sanctuary was eliminated.

[29]

MCKINZIE: Were you who were working on specific military problems aware at all that there were negotiations going on with the Yugoslavs -- between the Yugoslavs and the State Department -- to try to get the Yugoslav Government to stop providing a refuge to Greek Communist forces?

MATLOCK: I was not involved in such negotiations. I knew of the Department's great interest in the matter. I knew they were doing what they could. My impression was that deterioration of relations between Tito and Stalin made a change possible.

MCKINZIE: Mr. Matlock, do you think we should break here for this session?

MATLOCK: If you like.

[30]

MCKINZIE: It might be well for us to pick up the narrative of your career in late 1947. George McGhee had given you a title which you said was a special assistant for interdepartmental relations, but that in fact, it really dealt more with...

MATLOCK: It was really military aid, working with the Pentagon. There was a man in the Pentagon, Lt. Col. Charles Davis, who was the principal figure in logistics for the Greek war and he was my principal contact in the Pentagon, so we were just partners in getting the job done.

MCKINZIE: When the Greek-Turkish aid program was being implemented, the Marshall Plan was, of course, in the process of being worked out. I wondered what knowledge you have of all of that, and if you anticipated that there was

[31]

going to be a military aid component.

MATLOCK: My association with and knowledge of Marshall Plan preparations as such came after Marshall's speech at Harvard opening the subject. It would be improper to speak of a military aid component of the Marshall Plan at any point in the highly tense psychological history of that program. The Marshall Plan people would scream at you if you mentioned "defense" or "military" in connection with the Marshall Plan.

MCKINZIE: But, doesn't that betray on their part a belief that economic solutions were in themselves enough to save Western Europe? Didn't they consider the need...

MATLOCK: I didn't think that was it. Most of them understood as well as anybody the need for a defense of what is now called the North Atlantic area, but they felt that if the Marshall Plan psychology were contaminated as to motivation by

[32]

a military and strategic consideration that was always coming to the fore, it would greatly impair the success of the Marshall Plan and prejudice its acceptance in a number of European countries.

You know, in the beginning Czechoslovakia was invited and wanted in the Marshall Plan, but the Russians told them to get out. It was a non-war kind of thing, but basically its purpose was to strengthen Western Europe to make it invulnerable to internal conquest by communism. And it succeeded I think at that -- as well as anything could, it did.

MCKINZIE: How long did you stay with the Greek aid?

MATLOCK: I did some work for George before I moved into his office and then from November 1947 I was there until in August 1948. I went into the Office of European Affairs where I was a special assistant for economic affairs (they called it "economic adviser"). It was Harry [Henry R., Jr.]

[33]

Labouisse's job slot, and he moved to a Marshall Plan top job. Some months later I discovered that personnel management hadn't been able to change our job positions yet, and he was still technically in mine and I was still technically in one of George's jobs. It didn't matter, because operations had outrun the red tape. But Harry Labouisse and George McGhee were co-chairmen of an interdepartmental committee for preparation of the Marshall Plan. We had had an "interim aid" operation and a man named John Murphy, who was later controller of the Marshall Plan. He was very conspicuous in the interim aid program and also very conspicuous in the preparatory days of the Marshall Plan, but George and Harry were co-chairmen of the committee and there was somebody from every office on the committee. That was a State Department committee. When [Paul] Hoffman actually started the first day of work of the Marshall Plan, I think he spent somewhere in the neighborhood of 50 or 55 million dollars on

[34]

supplies immediately. Requisitions were immediately issued so he could say, "We're in business, you know, we started today, we have done a lot of business the first day."

A new man, a head of a program, always wants to do that, but the State Department was in some disrepute at the time and Hoffman didn't want any State Department contamination with his new agency's psychology and failed to mention that all of these requisitions were written for him in the State Department. Well, that's Washington. We understood.

MCKINZIE: Do you recall the work of that committee?

MATLOCK: Bits and pieces. It was just a good standard preparatory operation. There weren't any mighty issues fought out in it. It had been decided that there would be a Marshall Plan; the job was just to get ready to work. Then when Paul Hoffman's Marshall Plan agency was ready to go, it simply did everything from then on.

[35]

MCKINZIE: You said there were no major issues hashed out, but there were some issues that were touchy from the very beginning. One of them was the question of whether or not material aid should be transported to Europeans in their own ships. There was this thing that a certain percentage of it had to be carried in American bottoms and

MATLOCK: I don't remember any discussion of that in the Committee. I do remember the issue, which was a persistent issue.

MCKINZIE: I talked to a young man a couple of weeks ago who is trying to get at pressures of various sales groups -- wheat farmers and potato farmers, and suppliers of various sorts -- involved in the evolving of the Marshall Plan...

MATLOCK: Well, they didn't knock on my door. And so far as I know George McGhee didn't have to bother with them, and I never heard Harry Labouisse say

[36]

that he did. But remember that the Marshall Plan evolved in operation, not in the preparation.

MCKINZIE: Well, that's what I was trying to get at, were you able to do this without an awful lot of outside...

MATLOCK: I don't remember any outside pressures during the pre-operational period. I think the most difficult thing I did was to make a telephone directory of the people in the Government who were doing preparatory work on the Marshall Plan. You see, it was a new thing, a big thing, and nearly everybody wanted some kind of conspicuous relation to it.

I remember one fellow who called me up and said that he didn't really have anything to do and he needed something for survival. He was a good economist and had been looking over the different things that needed to be done. He was proficient in a certain subject, and asked me if I would put his name in the telephone book for that subject.

[37]

There was no competition for it, so I put his name in and nobody objected and that became his responsibility.

But there was also a good deal of contention where officers were competitive as to who was supposed to do what, and that affected the telephone book. There were about eight or nine drafts of that book before it was approved by McGhee and Labouisse, and I had to go through those.

At the same time I was working on a top secret operation of dispatches, letters, between the Secretary of State and the Secretary of Defense [James V.] Forrestal, and so on, about some very sensitive things that I thought were really difficult and might, if they were handled wrong, cause a conflict with Russia. Everything was approved in a first draft, right through that whole thing. That hot and cold contrast impressed me. But, you see, when people's individual careers are at stake, that's serious business!

[38]

MCKINZIE: In August 1948, you left McGhee's office for Hickerson's; was there any particular reason for that?

MATLOCK: I left because I wanted the job in the European Affairs Office. The Greek war was approaching an end. I didn't have any problem with George, that I knew about. I was just moving. We'd gotten very well on with the program and somebody asked me if I wanted that job, and I said I did.

MCKINZIE: When you took it there was already a great deal of planning underway for NATO.

MATLOCK: Yes, there was. Ted [Theodore C.] Achilles was the NATO negotiator, under Acheson. The Canadian, [William Lyon] Mackenzie King, I think got the idea in the beginning -- involving fewer countries. Achilles was a non-communicative person, at least to me. (Others also had that experience.)

MCKINZIE: To your knowledge were any economic people brought in to talk about the impact of NATO on the

[39]

recovery program?

MATLOCK: There were many economists working with the committee, and some on it. Such matters always come up, but I don't think that was a problem. Priorities prevail. I think that the Marshall Plan was successful. It stopped early, and by the time I was in my first year in London, it was pretty well over. Bill [William L.] Batt became the economic minister in the London embassy, and another man became the economic minister in the Paris embassy. They were consolidating the positions of the economic man in the embassy and the economic man over the Marshall Plan mission. But the Marshall Plan was over before NATO got serious.

MCKINZIE: What was the analogy you used about Europe...?

MATLOCK: A camel ready for water, yes. Europeans were highly competent. European countries in the Plan had gotten what they needed and they

[40]

knew what to do with it. The Marshall Plan was a huge success, and it was over sooner than expected.

Some other economic problems did develop later and then the phrase "defense support" was coined to label economic aid. (I don't remember its being used in aid in Greece, but it may have been.) In the beginning of NATO, the U.S. contemplated about a one billion dollar appropriation to buy up mainly U.S. surplus equipment from the Second World War and ship it over there. That's token armament. You can't fight a third world war with Second World War junk.

In point of fact it didn't exist. You couldn't have gotten it out of the surplus. The Greek war had shown that while there was a lot of stuff, you couldn't get complete units. If you could get the guns, you couldn't always get the ammunition. If you got the planes you couldn't get the spare parts, things like that. So you plan a huge total inventory, but when you go to

[41]

get what you want in complete units that you can ship to another force for use, you find that you can't put them together. Then you have to go out and contract new production for the missing things. We had to buy some parts back from private industry to go along with some excess airplanes for Greece and Turkey, I remember that. By the time I moved to the European Office I already knew that we were scraping the bottom of the barrel on surplus. But the people working on European armament hadn't been dealing with the Greek program and they didn't know that those surplus figures weren't real. I told them. They didn't know that you couldn't dip into that and get a billion dollars worth of useful armaments to give Europe a modest rearmament. But the figure of a billion dollars, I think Ted Achilles would tell you (I believe it's what he and the others were saying at the time) was simply a figure they thought they could get through

[42]

Congress and it wasn't until after the Korean war started that it was escalated to five billion. Then it was for real and it was new production.

MCKINZIE: But there were a few people who were saying that if the North Atlantic Treaty required defense production on the part of the recipients of Marshall Plan aid, it would alter the economic priorities that had been established under the Marshall Plan and therefore...

MATLOCK: I don't doubt at all that the issue you mentioned came up among those people at that time. It must have been a very real point to them. I didn't hear much about it, but it must have been very real. I didn't hear Bill Batt talking about it in London though.

MCKINZIE: When you went into Hickerson's office what were the major problems that you were assigned to immediately?

MATLOCK: Well, a special assistant does what comes

[43]

up, and he usually takes on things that have gotten a little too hot for the desk officer, who takes them to the boss and the boss says to the special assistant, "Will you take this and look into it?" So I did what came up, and it was an array of things. I didn't have some big single responsibility. I was a member of the Policy Committee on Arms and Armament, and of the Berkner-Lemnitzer committee for the preparation of draft military aid legislation for European rearmament.

MCKINZIE: Was the Policy Committee on Arms and Armament important, at that time?

MATLOCK: It was important, but it was just a routine action. It wasn't a big thing, but there had to be a committee like that, there had to be members on it, and the European Office had to name one, and designated me.

That's where I met Major General [James Kerr]

[44]

Crain. It had some subcommittees. I worked with General Crain on things that came out of SWNCC and SANACC, you've seen those names. I was with him when he opened up the first estimate of the total number of divisions we'd have to support around the free world to implement our armament policy. We looked at the figure and both said, "It's impossible. It's impractical. What we ought to do is concentrate on a few strong countries and not try to arm the rest." But that isn't what we did, that's just what he and I said.

MCKINZIE: When was that, by the way?

MATLOCK: It was when SWNCC and SANACC were operative and they produced their first report, and it was when I was in the Bureau of European Affairs, which means it was before November 1949 when I went to London and it was after late 1948 when I left McGhee's office.

General Crain was the one who received the report in the State Department. He was a State

[45]

Department officer in retirement from the Army, and we looked at it together. We thought it was an enormous number of divisions (over 200), but I think it's in line with what we tried to do for a generation of time after that.

MCKINZIE: Many people have said that the State Department doesn't have to keep its finger much on the pulse of public opinion, but from what you have told me and from what other people have told me, the State Department is very conscious of public opinion and in such matters as rearmament in early 1949 or 1948, a very touchy issue in the United States. To what extent was a man like General Crain or yourself upset, and concerned about public opinion?

MATLOCK: Not at all. We were just working on the problem before us. The problem was to estimate what you could and should do. Once when Eisenhower was President I was asked to head a small subcommittee of about three people to figure out how to save

[46]

money on the military budget in Korea, our budget and the Korean budget. I had to make a report as chairman of that group. The State Department member is always the chairman of an interdepartmental group on a foreign policy matter. I remember our coming up with the unanimous conclusion that there couldn't be any saving of money through reduction of the size of the Korean Army. Eisenhower said he wanted to save some money on Korean defense. What we said in effect was, "If you want to save money, you can do it, but you have at the same time to redefine your defense obligation in Korea. You have to give up the territorial obligation to defend the 38th parallel and retreat to some vague general principle that you will do something effective to discourage the North Koreans from renewing the war." That would have been a far cry from maintaining certain forces in Korea and maintaining certain numbers of Korean divisions and all of that sort of thing.

[47]

We then had the second kind of commitment, greatly watered down, in Vietnam. We didn't have a commitment in Vietnam like the Korean; our combat commitment in Vietnam developed piece by piece as the war came on. That comparison was made at the time we were talking about how many divisions the Koreans needed and how much force the U.S. needed in Korea. The State Department Far East Bureau, my bureau, made the point that the commitments were different.

In Korea we have a 38th parallel to defend and all of South Korea, whereas in Vietnam the SEATO Treaty was simply that a member does what seems reasonable at the time. In the case of the North Atlantic Treaty an attack on one is an attack on all. You're at war but you do whatever seems reasonable and constitutional to you. In fact, however, NATO has no actual way of deciding to go to war, because it runs by the rule of unanimity in the Council, and it includes some countries that might be overrun the first day.

[48]

So, everyone in NATO just tacitly assumed there would be a Soviet attack starting a war and you'd react and be in it and that's that, which is probably true. If you've just been clobbered and you're reacting, you're at war and Congress will do what it did in the First and Second World Wars, recognize that a state of war exists. What else could it do in the Second World War? We were more or less dragged into both wars, after which we fought them for "noble" reasons. There are some American myths about this.

MCKINZIE: How did you happen to get an assignment to London after you had gone into Jack Hickerson's operation in European Affairs?

MATLOCK: I was interested in it. The European Bureau was being reorganized. A whole new set of people were coming in. Jack Hickerson and Llewellyn Thompson, my bosses, were going out. A good spot wasn't offered to me by the new Director. So I was looking around for a new assignment and London

[49]

interested me. That's how I got it.

MCKINZIE: Was there intense competition for it?

MATLOCK: I don't think so. I don't know that I wasn't the only one considered for the job of Political Adviser. [Charles H.] Bonesteel got the job of Executive Director that had been slated by Berkner for Walter Surrey (who picked me), but Harriman got it away from Surrey for Tick Bonesteel. Surrey started a law firm, now very large, fine, and important. I think his comment to me was, "Three times a bridesmaid and never a bride, I'm going to do something else." Surrey and Berkner picked me, and Bonesteel and Ambassador Douglas accepted me. There is a nuance. Surrey is a very prominent man today, but I guess Tick wanted the London job of Executive Director, and Tick had been a special assistant both to Harriman and to Secretary Marshall. He was well qualified and did a fine job in London. Lloyd Berkner, a scientist, and General [L. L.] Lemnitzer, who's a good friend

[50]

of Bonesteel's, were co-chairmen of the committee for preparation of legislation for European rearmament, the U.S. military aid program for Europe.

That's another thing, I was on that committee. I have forgotten its acronym. The European Bureau assigned me to that committee, so I was a member of the committee to prepare legislation. I think it was called FAMACC, something like that. Being on the committee got me into a lot of work. Then I saw the opportunity to go to London and asked for it.

MCKINZIE: Do you remember much about the work of that committee?

MATLOCK: There was nothing routine about it. It had hundreds of tasks. When you get ready to do something new and big, it's not a routine thing for the U.S. Government. It's urgent, intense, and demanding. But I spent most of my life in Government doing things that were not routine, but it was

[51]

routine to do them. It was just a day's work, every day, all day, sometimes a good part of the night, but usually we got away at the hours that State Department people usually get away, between 6 and 7 o'clock at night.

Berkner was not less important than Lemnitzer. Perhaps it was the other way around. Berkner was a friend of Dean Acheson and Acheson brought him in to work on that. Berkner, the famous scientist, Lloyd Berkner, went to the South Pole with Admiral Byrd. Later on he was head of a defense research program in a bunch of colleges. He was the head of the weapons evaluation system during the Second World War in the Navy Department. He was a very able man.

MCKINZIE: They must have been concerned about what was politically possible, in the way of...

MATLOCK: Oh yes, foreign policy work is always political in the sense of inter-governmental relationships. But in the State Department during the last ten

[52]

years that I was in it, I remember that we had an occasional reference to the question of domestic politics, and our instructions in staff meeting were, "When you make a proposal, do not consider American domestic politics. If you do, you'll confuse the issue. The Secretary, the Under Secretary and the Assistant Secretary and the seventh floor apparatus will take account of those things, and the White House will take account of those things, and the congressional leaders will take account of those things. But if you take account of them too, then your recommendations won't be pure foreign policy -- which they ought to be. They won't be a professional evaluation, they'll have a domestic political content and then nobody up the line will know what he's doing. The top echelon can introduce the domestic political considerations and say, 'Well, we couldn't do it now, it won't work,' or 'Yes, the Congress and American people will accept that."'

So, the politics, the political acceptability

[53]

of an idea, comes at the Assistant Secretary level and above. There they get into the whole American domestic political evaluation structure such as it is. I never had to give any thought in anything I ever did to the question of whether the American people wanted to do it or not. I just recommended what seemed to be the right thing to do. And then the memoranda would go and bounce back and lie flat for years, or they'd go on up. General [Fred] Anderson said to us in Paris once, "Fellows, you're doing the most important work in this building, and you'll be successful when your ideas are adopted and everybody has forgotten that you had anything to do with it."

Some of the most successful pieces of paper have never been cleared with anyone, but turn out to be the basis of a major policy development. Anderson was assigned, in the Pentagon, the job of figuring out when the Russians would have the atom bomb. That was Air Force Major General Fred Anderson. (There were two Fred Andersons, both

[54]

generals, but he was an Air Force general and he was Draper's deputy in Paris.) He assumed that the Russians were just as smart as the Americans, no smarter and no more stupid, just the same. And then he found out from intelligence where the Russians stood in the atomic bomb development work. He found out from the scientists how long it took the U.S. from where the Russians were -- how long it took for the Americans to develop the bomb after that point. He just added that much time to the date and came up with a year and said the Soviets would have it in that year. He told me he picked the correct year.

He also made a study of Air Force requirements. He said he never cleared it with anybody, he just had a committee and they put together a fine document and made a lot of copies and put it around. Then when Vinson's committee studied the Air Force and [Thomas K.] Finletter's committee studied the Air Force and were looking to see what there was on the subject, they found this

[55]

report. They were in business. Two-thirds of their work was done. That's one of the best ways to be successful in getting your ideas adopted. The best way is to be President.

MCKINZIE: Could I get you to begin to talk about your work in London?

MATLOCK: By the way, you were asking what I did. I also did some economic things. I remember working on the question of British devaluation. We had a really sharp issue, and I was on the conservative side of it. The issue was whether or not to press the British into devaluing the pound. That was in '49 and I said we shouldn't push them into it at all, and we shouldn't tell them they should do it until they had decided that they were going to do it whether we liked it or not. I said there had never been an economist who knew after the fact precisely what the consequence of a prior devaluation had been, and there certainly wasn't one who knew beforehand what the consequences

[56]

would be. Therefore, anything that went wrong could be blamed on the U.S. if we shoved the British into it.

I saw Jack Hickerson for a split second. I was sitting on the edge of a chair, going to a meeting with Assistant Secretary [Willard] Thorp, economics, and he had some advisers who were saying, "You've got to hit the British over the head and make them do this." I wanted to know what to say, so I asked Jack. He said, "Say just what you said." And I went off and said it. The British did devalue after a while, but I don't think Thorp hit them very hard on it. Of course, he's an independent minded man.

Many years later I gave a talk once a month in tandem with Marshall Green, who's been an Assistant Secretary and is now an Ambassador in East Asia somewhere. Marshall and I went once a month to the Military Assistance Institute. He made a political talk for about an hour and

[57]

I made an economic talk on the Far East for about an hour. Then we had a coffee break, and after that a two-hour question period.

The general reads your whole career to introduce you. It sounds as if you own the Government or something, and I had a habit of breaking the ice by just saying, "Well, I just do whatever comes up."

Then I told the story that always got a laugh. It was a one-month training course for officers from about major through general, going overseas on advisory work. I said, "I do what comes up." Now you'd understand that if I tell you the story that followed. Once on a very bad day, crossing the English Channel, there was a poor soul who was leaning over the rail; it was in the evening, and he was miserably seasick. Then there was one of the sturdy types who can smoke a pipe or cigar and stomp up and down the deck and enjoy the fresh air while everybody else is leaning on the rail. One of these men came up and slapped this

[58]

poor fellow on the back and said, "I say, my good man, has the moon come up yet?" And the fellow said, "I guess so, everything else has."

Well, that's a good way to put it, "everything else has." Now, as a person just under a top figure, you may be assigned a project, as I often was. For example, I was assigned to work on the devaluation of the kip in Laos in 1958 when a couple of other high ranking officers practically got sick trying to finish it and decided they would give it to a subordinate. That's when I got it.

We worried with it until finally it happened in October of '58. You get a project assigned, and then you know all about that, and then you drop it because it goes back to the desk officer, and you don't know in detail what happens after that unless it becomes a crisis again and they bring it back to you. Then you get acquainted with all the facts and everything and work on it again. So, you only get it while it's a hot issue, while the

[59]

top boss wants you to fuss with it, and the minute it's under control as far as he's concerned it goes back to the hierarchy the way it should; just the right way to do it.

Anyway, for an ordinary staff assignment you get a few subjects that are characteristically yours. But when you get all through, you don't feel as if you have mastered anything, or been the principal or sole factor in anything.

I was sitting next to a geologist once at a luncheon meeting of Boards of Trustees and Overseers of American Colleges and Universities at the Hilton Hotel in Washington. He asked me what I'd been doing and I told him. I told him I envied him. When he built a steel mill he could look at it and say, "There I did that." Whereas in the State Department it's like walking on water. It's very hard to do, but it doesn't leave any footprints.

Well, there's some truth in the matter. You

[60]

get all through and you say, "Well, what did I do? Oh, I was there," that's about it. One had a lot of experiences, very strenuous and all that, and yet no one ever did anything all himself. Very few ever made a final decision; they just made a succession of decisions, but not a final decision.

One ambassador told me he liked to fix water taps and things at home, put new washers on, because he could make a final decision.

MCKINZIE: Sounds like Henry Grady to me.

MATLOCK: It wasn't Grady, it was Jack Bell, Ambassador John Bell. At home he could make final decisions, at least some final decisions. I saw Harry Labouisse once when he was getting the Marshall Plan ready. He was walking down the hall and we just stopped to chat for a minute. He had a paper in his hand and I asked, "What's that?"

And he said, "Well, it was a very fine draft in the beginning, but now it's just an agreed

[61]

document."

MCKINZIE: Could we have a little local color about London in 1949? Was London a decent and livable place as far as you were concerned by 1949?

MATLOCK: Yes, it was very nice. Of course, I made my own arrangements. The Embassy put me and my wife up at the Mt. Royal Hotel. It was a modest accommodation and it didn't cost very much. Most officers want to save money and I'm not different. On the other hand, I had never been to London and you couldn't see the sun. The first 10 days I was there there was no sun. After 10 days we had gotten acquainted with the neighborhood, and we moved into a room in Grosvenor House on Park Lane. After three months we got a flat in Grosvenor House with a seven-year lease on it, and a diplomatic clause.

In 1964 when I was visiting London on the Colombo Plan, I was asked whether I wanted to come back to Grosvenor House. I said I couldn't

[62]

come back as a diplomat. I couldn't ask for a diplomatic clause, and I couldn't take on a seven-year lease and so on. And they said they thought that since I was an old friend they could do it again for me. And then they said, "You know, you're the only person who's ever had the diplomatic clause at Grosvenor House." I've felt complimented ever since. My wife and I simply found a place at Grosvenor House and lived there. In Paris we lived at the Hotel Continental for a while and then moved to the Hotel Crillon, which is on the Place de la Concorde. We lived at the Crillon all the rest of the time I was in Paris, except the last month.

MCKINZIE: It was much more pleasant then.

MATLOCK: Well, yes, but I had an invalid wife and I had to be sure that she was surrounded by things that relieved physical strain or hazard -- in terms of heating, for example. Grosvenor House has central heating, which was hard to find in London,

[63]

and many services. You see, we had a maid, valet and a waiter -- three buttons to press. Then we employed one of the servants with the permission of Grosvenor House as a fulltime servant, including cook. So, we had a very comfortable, nice operation; brought our furniture from America.

In London if you rent a flat you have to buy new lighting fixtures and everything, even in Grosvenor House. They remodel the whole flat (apartment) and refurbish it. They do it for every tenant and charge the previous tenant. I think I paid a thousand dollars to prepare the apartment for the next tenant, but it had also been done for me. They took all the fixtures out of the bathroom and re-chromed them; all the doorknobs off the doors, re-chromed them; took all the wood paneling in the closets and refinished it, put it back in.

The Embassy didn't arrange those accommodations at all. I wasn't a VIP. I was just another senior officer coming over to be on duty. The

[64]

Embassy got me a hotel room for the first few days I was there, and after that I was on my own. The Ambassador has a residence in London, and the Minister has a residence, and nearly everybody else is in business for himself.

MCKINZIE: Could you talk a little bit about what kind of a setup they had waiting for you when you arrived, as far as your work was concerned?

MATLOCK: Just a desk and an office. I don't think Tick Bonesteel was there yet. I think he came a week or so later. We just went in from scratch, you know. Tick had to organize himself, and then we had to decide what we were going to do and things like that.

MCKINZIE: You waited until he got there and...

MATLOCK: Yes, I think I was a bit of a novice at that time and it took me a while to figure what I ought to be doing.

MCKINZIE: Well, there were a lots of important things

[65]

going on by that time and...

MATLOCK: Of course, but there are embassies in every country, and the telegrams are going back and forth every day. The ambassadors -- except Douglas -- probably thought the whole London operation was unnecessary and stepped on their toes.

MCKINZIE: How do you mean that?

MATLOCK: An intermediate State Department regional organization between Washington and the embassies overseas is never welcome. Tick Bonesteel could call a regional meeting and somebody had to go from every embassy to London and spend a week there. A lot of documentation had to be prepared and all that sort of thing, and I think they would have preferred dealing exclusively with Washington. I've never known anybody in a diplomatic establishment who didn't prefer dealing as directly as possible with the Secretary of State. Usually you have to deal with an Assistant Secretary. Some

[66]

people have a lot of clout and they can deal with the President, but not many. They represent the President, ambassadors do, but very few can write him a letter -- except of resignation.

MCKINZIE: When Bonesteel came, how did you happen to get tied up with the European Coordinating Committee so quickly?

MATLOCK: That was my only reason for going to London. The European Coordinating Committee existed already, but it didn't have a staff. Tick became the Executive Director, which is chief of staff. I was sent over to fill the slot of political adviser. Dick Freund went over to handle production. A fellow named A1 Lindley was there and he did something economic. There were a couple of others. So we covered the main sectors of activity, economic, political, and military. There was a military assistance regional organization for operations headed by General Kibler with HQ in London. General Biddle was his deputy, Bill

[67]

Biddle. But here were a regional policy office, and our service was to our principals, the membersbof the European Coordinating Committee, and Washington. The members were Ambassador Douglas, Chairman; General Tom Handy, who commanded U.S. forces in Europe, EUCOM; and Averell Harriman, who was in Paris and head of what was left of the Marshall Plan and anything else going on that was economic. By now, "defense" was polite; but what would have been called Marshall Plan aid before became defense support. And the rationale had changed. Since the Marshall Plan was over, and since they wanted to give some economic aid, there had to be a new name for it: it was "defense support."

MCKINZIE: This was still 1949, technically the Marshall Plan was supposed to run from 1948 through '51.

MATLOCK: I think it ended in 1950. I suppose defense support was in by 1949, but I heard more about it

[68]

in 1950. It was a way of re-instituting economic aid, but it wasn't called Marshall Plan. It was an adjunct to defense by that time. But before NATO it wasn't proper or politic to talk about defense. Up until that time we were going to hold Germany and Japan down as a demilitarized nation, and Russia had been an ally. Up until the Korean war, the thought of European rearmament was still a token thought. Political alliance was real, but the rearmament was a kind of a token operation.

MCKINZIE: Could I get you to amplify on that a little bit, "Alliance was real but rearmament was token"?

MATLOCK: Well, there weren't any substantial rearmament goals spelled out, and the American appropriation proposed of l billion dollars was to buy surplus equipment out of the U.S. stockpiles, and that theoretically would get a lot of surplus equipment. In practice it wouldn't have, but theoretically it would. The equipment wasn't

[69]

there, as I said, but in any case it would not have been serious rearmament. You couldn't get ready for the next war by rearming with World War II equipment.

MCKINZIE: And there was no serious discussion of asking European nations to undertake defense production.

MATLOCK: Defense production in every allied country was urged. It was urgently urged after the beginning of the Korean war which changed the Western defense perspective. The Korean war was a signal for the west to "scramble" -- in the Air Force sense of the term. Our defense budget started up again, and we put up our guard.

There had been very serious consideration by May 1950 of the military position in Western Europe, which was not good, to put it gently, in case we were attacked. It's fine if you're not attacked. And there were a lot of reasonable understandings of the economic situation, which was not too bad. Politically Europe was not united, and not really

[70]

broken up. It was doing pretty well. De Gasperi was a strong and constructive figure in Italy, and Adenauer was leading Germany well. Britain was being led very well by Attlee and Churchill, one at a time.

MCKINZIE: To what extent were you sympathetic with the goals of the Marshall Plan people who wanted the economic program, one way or the other, to foster European integration, particularly economic.

MATLOCK: Well, what I thought of it didn't matter much to anybody. But what I thought was that integration was a good idea within a framework that our interests could tolerate. At the time England didn't want any part of European integration.

I remember one cartoon somebody cooked up; I don't believe it was ever published. But Hoffman, who was pushing integration, was arriving at Heathrow Airport and Mr. Attlee shook his hand at the airport and said, "Mr. Hoffman we are so glad to see you in England. Are you going to

[71]

Europe too?" It was a nice way of answering the question expected from Hoffman before it ever came up.

Well, I thought it was a good idea, but I remember pointing out from time to time during the three following years, that we had fought two wars to prevent the integration of Europe by Germany, and it made a great deal of difference how it happened. So, reflect on that. What we want is integration in a way that brings a peaceful, reasonably democratic, strong Europe, friendly, or at least not hostile to the United States, and, hopefully, ready to join us in any great defense effort that might be required if Russia or China should cut loose.

I never knew who decided to reverse the policy on German and Japanese disarmament, except that it had to be the President's formal decision. I was part of the chorus to explain why we had to arm Germany and Japan. But it was a great surprise to me when

[72]

the policy was changed. But then when I thought about it, it was obviously going to be necessary on the ground that the United States could not afford to have Germany, Russia, and Japan, and maybe China aligned against it as a solid bloc. That's too strong a combination, we couldn't win that war.

Therefore, if Russia was going to be an enemy (and it had decided it wanted to be an enemy, because it saw opportunity for expanding communism, and friendship with the United States wouldn't permit that), then we had to make friends and allies of West Germany and Japan. We couldn't do it by making them peasants.

So, disarmament policy was made armament policy. I didn't hear about it until May 1950, and it didn't break out in the open until September in New York, when the U.S. proposed it and the French blew their gasket.

MCKINZIE: I think in Acheson's book he talks about

[73]

a meeting in May of 1950 in which he was still taking the position the Germans should still be disarmed, and then he began to make some changes.

MATLOCK: Well, in May 1950, I don't know what his discussions with McCloy and Ambassador Douglas were -- but John J. McCloy, I think, was in Germany.

MCKINZIE: High Commissioner.

MATLOCK: Yes. Well, he and Harriman and Douglas had been together and then there was a meeting of the European Coordinating Committee. Tick's staff, Bonesteel's staff, all prepared papers for the committee to look at. I prepared papers on the political side. One of them was a short statement on the policy regarding Germany, and I simply reiterated it. I quoted a sentence from the State Department policy paper. During the meeting Douglas picked that one up and said, "Are there any comments on this." Harriman said (he

[74]

was sitting right next to me at the table), "We might add the words, 'at this time,' at the end of that."

Neither of the other two disagreed and Tick was instructed to tell the State Department to add the words, "at this time."

So, since I had quoted verbatim from the policy document, it was possible to put it in those terms, and we telegraphed Washington that the European Coordinating Committee recommended that the phrase "at this time" be put at the end of the statement of policy to keep Germany demilitarized. So, that was the first indication I had that the policy was changing, May 1950.

MCKINZIE: By saying "at this time" it implied that there was a change in...

MATLOCK: It meant that we were opening the door to change. Nobody does that in the U.S. Government unless he's already got a change in mind, or thinks one is entirely possible. So, I just concluded

[75]

that they'd been together, didn't want to talk in front of the staff, but they'd been together about it. They didn't discuss it, they just approved the change. And from then on it went fast. But nobody decided to have a real defense of Europe until the Korean war came along. Then it got serious. In August of 1950 the U.S. Government raised the estimated scale of U.S. expenditures on European rearmament from 1 billion to around 5 billion per annum and proposed that all NATO members step up their own defense expenditures. We were thinking in terms of 9 or 10 percent of GNP. By December of that year Attlee apparently had decided that England ought to have a defense, even if England had to pay for it, which the U.K. didn't want to do. Then Attlee adopted a policy of British rearmament, which was duly published. That was the kind of thing the U.S. liked to see at the time. It was so much of an undertaking that when Churchill became Prime Minister again he "stretched it out," to use his phrase, cut it

[76]

down in other words as a annual cost.

MCKINZIE: It seems to me that when these proposals for European rearmament that came out in August of 1950, and were pretty well firmed up I think by December, that there would have been economists in the ECA mission, attached to the embassy and in other capacities, who would have said, "Look, this is beyond the ability of these economies to sustain; and more than that the inflation which is going to be sparked by rises in prices of raw materials due to U.S. rearmament effort is going to throw this all into a whole new bag, and don't you think this is too much too fast?" Which is in effect what Churchill had to say was too much too fast, actually...

MATLOCK: For England.

Excited economists may have talked one another into a blue funk. But those working with us were aware of the defense priority. As for England, Churchill was depending upon the United States to do

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the defending, don't forget, and Churchill's a man who, up until the hydrogen bomb experiments in the South Pacific and the sick Japanese fisherman 80 miles away, basically wanted to challenge Russia and get the question of war or peace settled while Russia was still weak. He gave that up when he found out what a weapon the hydrogen bomb was. I think he said that if you dropped three of them in the Irish sea it would destroy England by generating tidal waves. But he depended upon us. So, don't assume that England's defense was just whatever England could do, in the mind of an Englishman.

Remember, we inherited the English Commonwealth for a while. When I made a State Department study in 1954 of what had happened to the Commonwealth as a result of the Second World War, I got down to the basic question of what does a government do, what does any ruler of a territory do? Well, for one thing he has to defend the territory, or he won't have it.

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Second, he has to shore it up economically if it has troubles. If you've got a weak point you've got to put aid in. So, you have an economic aid program that can flow from the metropole to the parts, or from the head country of commonwealth to the member countries, or from a country to its less endowed allies -- which is the U.S. case.

The third thing a government or head of commonwealth has to do is a combination. It's one or the other. It has to govern and it has to lead. The more it leads the less it will have to govern, because if it has the qualities of leadership it will have a following, and the disciplinary problems won't be as numerous or as severe.

Those are the functions of England in the Commonwealth. What has happened to those functions? You look it over for yourself. The U.S. took on the function of defending a good part of the Commonwealth and even of defending England. England was depending on us. Australia decided

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it would have to depend on us for future defense when the Prince of Wales was sunk out near Singapore. The Prime Minister published an article saying that thenceforth Australia would look to the United States for defense; it was public print, look it up. I think Madden was the Australian Prime Minister.

MCKINZIE: Madden, Kenneth.

MATLOCK: That was an illuminating comment by him. Well, is England defending the Commonwealth? On trade too, our proportion of the trade with virtually every Commonwealth country increased in relation to England's proportion. Our aid to the members of the Commonwealth, including England, had become substantial at one time or another. We were defending the realm, and we were doing the economic function of supporting it at weak points. Actually, our "commonwealth" was most of the free world in the sense of defense, economic aid, and leadership -- but we had no power to govern. Neither

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does England govern Australia.

On the Marshall Plan Hoffman was criticized for giving England help when England was helping India, because of the frozen sterling balances and things like that. Hoffman said, "We're helping England as a going concern and we're not going to ask England to act like a pauper," which was the right answer, he was exactly right.

All right, there's that.

Then on leadership. That's a difficult question for -- as a matter of governing -- England can govern the colonies only with difficulty and can't govern any of the "dominions." What were dominions are now just Commonwealth members. Every time there's a new coronation the British revise the style and titles of the sovereign and you can read the evolution of the Commonwealth and empire by reading each new description of the sovereign's supposed authority. The phrase "Empress of India" and that sort of thing is not in there anymore.

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Well, anyway, the U.S. had taken over an increasing proportion of each responsibility, and in some cases virtually all of it. England itself, the presumed source of all hope, defense and help to Commonwealth members was getting its help from us. And so we had, in fact, inherited several of the principal responsibilities of leader of the Commonwealth.

A man in Ottawa told me once that if we had the wit to realize it we had inherited the Commonwealth. That was in 1942, in Ottawa. He was a Cabinet member.

Well, he was glad of it. He was a great admirer of Roosevelt's too. But it wasn't until 1954 that I studied this question, documented the thoughts I had and so on, and went on to another job. I think you need to keep those functions of a ruling, or governing, or leading power in mind.

Now, for example, England has to lead Canada. It's never been able to govern Canada.

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The Canadians always got the advance in autonomy before others. (We were first, but we fought for it.) The French in Canada are so independent that they've never been able to have conscription in Canada. The British did not consult Mackenzie King before the Second World War to see whether Canada would back Britain if Britain got in the war. They were asked not to consult Canada, but just "Don't worry, don't consult us, but don't worry."

Now, if the U.K. had consulted Canada, the Canadian Government would have had to consult the Cabinet, and that would have meant consulting the French Canadians. The latter would have said, "Go to war for England? What for?" So, the best thing was just to leave it to events.

As it happened, the events put England in a good moral position. The whole Nazi movement, either at its conception or later on, and certainly later on, was an evil thing. There's no doubt in my mind about it. It wasn't just a bad thing,

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it was an evil thing. And therefore, it was not difficult for the members of the Commonwealth to support England. But some of them warned England that it wouldn't be automatic in the future. England would have to be morally right. That came out on Suez. And of course, in England there was a bad split over Suez.

MCKINZIE: Well, in 1950 I understand that England would be very touchy about its losing its former empire, but...

MATLOCK: Not too. The French I think were far more touchy. The British are pragmatic people. They take it the way it comes. They can be a little browned off about something that happens, like Suez. But the thing about Suez that hurt them, that angered them most, the British people, all the British people, was the paragraph in an American statement by John Foster Dulles that we agreed with our friends and allies about

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most things but not about "colonialism," and it was aimed at Britain and France.

Well, the British were in the process of liquidating an empire and transferring power as fast as they could, and to have Dulles say that just sent seething anger through both sides of the argument in Britain. I checked this out with John Chadwick (U.S. Embassy Commercial Minister) later on at luncheon one day. My impression was that the most sensitive point about Suez for U.K.-U.S. relations was not the argument over whether England should have gone in -- a question which divided England -- but that Dulles comment about American virtue and British colonialism.

MCKINZIE: Well, did anyone, to your knowledge, sit down in the summer of 1950 with the statistics that were available on the future of the British economy and projections and say, "You can afford this much, but you can't afford that much."

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MATLOCK: No. No, not that way. We asked all to do more than they were doing. We believed that they all could do more. Our approach was in terms of higher percentages of GNP for defense. The "Lisbon goals" of 1952 set by the North Atlantic Council have never been realized. They probably haven't been half realized. I among others argued at the time of the Lisbon meeting that the European countries would not -- not that they could not -- put up the men and resources to meet requirements of that order of magnitude even if the U.S. financed it all, which the U.S. would in no case have done. But nevertheless those Lisbon goals were adopted. I know the point. I am or I was an economist, and I think it's a fair discussion; but then defense was the important question, and whether we could afford it was a question of capability and not of preference. It was something that had to be done if it could be done.

The Europeans never were prepared, or willing,

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to do what we thought they ought to do and what we tried to get them to do. There’s a tale to be told on that when we get around to it. But you see, the goals were set in a Council Meeting -- Ministerial level -- in Lisbon, February 1952.

As far as I know they are still the paper goals of the North Atlantic Treaty Organization. A stretch-out or "long haul" policy was adopted in April 1953 in Paris. One reason the European countries wouldn't act as urgently about defense as the U.S. proposed was simply that they didn't think the Russians were that much of a threat. We always estimated the Russian threat to be a little more serious and immediate than they did.

Years later one German in NATO remarked to me in Paris that he couldn't see why we in the U.S. were so upset about Cuba. He said, you know, "We've been living right next to the Russians all this time, and we don't get so excited about it." He was a senior officer in NATO at the

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time we talked. It was along in the '60s, after the Cuban crisis. That was years after I left Paris duty. But I went back to Paris a number of times on Far Eastern business.

I'm willing to believe any economist who tells me that the question of economic capability was a big issue in his office, but I'm not willing to believe that it was a big issue in the State Department, or White House, or the European Coordinating Committee. Harriman never said anything about it that I can remember. But don't misunderstand. Economic questions are always mentioned. The question is as to the degree of their urgency.

If you want to find out about this look up Tick Bonesteel's office's papers. I think most of them were confidential, administratively controlled, but confidential or secret, and there were economic papers prepared parallel to the political and military papers. I prepared the political papers. Others, Dick Freund, maybe Al

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Lindley, maybe Chris Merrilat got into it, and maybe Bob Macy had something to do with it. Macy might say you are absolutely right in what you said, that there was a flaming issue over Europe's economic capability to take on defense.

MCKINZIE: I know there was in a few people's mind, I don't mean to imply that . . .

MATLOCK: It must have been. It must have been in someone's mind who was cubby-holed, an economist who was cubby-holed on the problem. He might see his whole effort going down the drain because of this great rearmament business. On the other hand, we were working against a theoretical D-Day sometime in 1954. We were getting ready for war in other words.

MCKINZIE: Now how did that come up?

MATLOCK: Well, when you're doing military preparations you always assume something. One question is when you have to be ready for war. You can't just

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say, "Let's do as much as possible, as soon as possible." That has conflicting criteria. You have to say, "Let's do X -- a set goal -- as soon as possible," or "Let's do as much as possible by a specified date."

There was a time when I was in Iran when some benighted soul sent a dispatch, round robin circular, big new policy. We had to get some "impact" aid projects. Impact was the word, maximum impact, the greatest effect in the shortest possible time. And I remember a fellow said in the ambassador's staff meeting, "The only thing we can think of that meets both conditions is an explosion of a hydrogen bomb."

So, you have to have an assumption, and militarily there is always an assumption, and as I recall it was mid-1954. Fortunately Stalin died and also maybe we didn't need to be that worried. But I think the U.S. was always a little more concerned about the Soviet threat than any of the European Allies, and that their reluctance to

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put out effort, men, resources and money, but effort, that's what it all represents, was based on a slightly different set of priorities reflected by this difference in estimate of the Soviet threat, "the menace."

The Japanese had the same difference about Communist China. Dulles wanted the Japanese to be more worried than the Americans were, because they were closer to "the menace." And the Japanese said, the Prime Minister said, "You must remember that Japan accepted civilization from China and there is an affinity between the two peoples." I took the minutes, that's how I know what he said.

MCKINZIE: Could I ask you to comment on a theoretical explanation for the switch of emphasis from economic reconstruction to defense?

MATLOCK: I think the Korean war had a lot to do with it. Now, the North Atlantic alliance is a normal development suggested before the Second World War was over, I think, but maybe not that soon. Anyway

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Mackenzie King was thinking in terms of a few countries, maybe just three at the beginning. I think there was Canada, England and the United States and he was thinking of Canada's problem in maintaining good relations with the other two, something like that.

But then it got expanded to eight and then it got expanded to 12, and then there was the issue over Greece and Turkey, which was a real issue because some European members argued that Greece and Turkey were not Atlantic area, that they were a different kind of culture, Near Eastern, and therefore it wasn't any longer "community," it was just more alliance.

MCKINZIE: Well, along with that go rising and falling fortunes of individuals within the State Department.

MATLOCK: Oh, that always happens. If you try to follow all those things you'll be deep in the mire.

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MCKINZIE: I guess my question would be, "Were the rising and falling fortunes part of the cause, or were they the result?" If I can expand just a bit

MATLOCK: All right.

MCKINZIE: George Kennan's fortunes within the State Department were extremely high in 1947 and 1948 at the time of the Marshall plan and the Policy Planning Staff was doing a lot of things and economic solutions seemed to be getting a good hearing at the very top.

MATLOCK: But he was author of the containment policy, he was the "Mr. X" who wrote the article, and containment wasn't just economic.

MCKINZIE: That's a very good point, but he did, when it came to hammering out specifics, tend to emphasize economic things, and that eclipsed Jack Hickerson, and, well, Theodore Achilles, I suppose, in the European Affairs Division.

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MATLOCK: Hickerson and Achilles still work together, they are working on Atlantic community now, up in Washington. It's a private organization.

MCKINZIE: But their stock seemed to rise in 1948 and 1949 after the Berlin Blockade and the clear need for something like NATO.

MATLOCK: I thought Hickerson reached his peak of influence almost when I was there -- 1949. He was later made the Assistant Secretary for United Nations Affairs and then he was an Ambassador to Finland, and even later he was Ambassador to the Philippines. He's a nice fellow, I like him. I've seen him frequently at the Metropolitan Club. He stops in for lunch at the members' grill and I used to do the same thing. Off and on he'd be at the table, but I always liked Jack, a real fellow. I wouldn't say that his influence declined but that I was astonished that they didn't leave him in charge of European Affairs. They put a man named Perkins in to succeed him, and Jack would

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have been far better. Perkins, might have been a man of great ability, but I think he was a novice by comparison with Hickerson.

MCKINZIE: Well, I meant that as Kennan's influence declined Hickerson and the European Affairs Division increased, because they had after all been sponsors of NATO.

MATLOCK: I would say Acheson was the sponsor of NATO and whoever else Acheson agreed with -- they didn't tell me. But I don't think Hickerson and Achilles coined the idea of NATO. They were both important in giving the idea political reality and organizational substance.

MCKINZIE: At one point before we went on the record, you mentioned that you had worked with Walter Surrey in connection with European defense.

MATLOCK: Yes. That was just before I went to London.

MCKINZIE: Could you talk about the work with him?

MATLOCK: Well, Surrey was the principal person in

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charge of a great deal of preparatory work. He was extremely competent. He was, I think, Deputy Legal Counsel of the State Department and he had a certain amount of staff and he was doing coordinating jobs for Lemnitzer and Berkner. It was very important work, extremely important, and he was the one who sent me to London, he and Berkner. Walter has a law firm now, a big outfit; it has about 40 attorneys in it.

MCKINZIE: You were political officer to the North Atlantic Council?

MATLOCK: I was a political adviser under Achilles in the office of the American delegation to the North Atlantic Council deputies. That was Ambassador Spofford's office, Charles N. Spofford, who was international chairman of the Council Deputies and head of the U.S. delegation. Achilles was under Spofford.

MCKINZIE: You attended those meetings as early as

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1950, you were in very early meetings of the...

MATLOCK: I was at the first meeting at Lancaster House and I think most of the rest that were held in London (13 Belgrave Square). There were usually eight or ten Americans there. I was there when Eisenhower took command.

I didn't attend any of the meetings in Paris. I think the meetings Acheson attended were the ministerial level meetings. For example, the meeting in Lisbon in February 1952. I didn't leave London. Spofford went with Achilles and a couple of others and my secretary -- he called me up before Lisbon and said he had to have her, she was one of the best ones there, awfully good, an admiral's daughter. Anyway, they went to Lisbon and adopted the Lisbon "goals," the military requirements.

MCKINZIE: Right. But in these very first meetings there weren't clear military goals nor were there very clear possibilities for...

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MATLOCK: Well, there was an intention to have a North Atlantic force. And then before very long it was decided that Eisenhower would be asked to command it.

MCKINZIE: That was in December of 1950.

MATLOCK: Yes. And he came over and accepted the command.

MCKINZIE: The work that was done in the North Atlantic Council was very important work and Acheson contends in his book that he pushed very hard for what he called a "one-package" deal. Do you recall that, it was going to be an increase in U.S. troops to Europe, there was going to be increased commitment by European nations to the NATO collective force and it was going to be an American commander, and at one point they were asked all of that in one package. Did argument for that fall to you?

MATLOCK: No, not to me. I didn't negotiate anything like that. I was working essentially within an American organization advising Americans, and I

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didn't negotiate with the other governments. Neither did Tick. The Ambassadors did that.

MCKINZIE: Well, wasn't it necessary to backstop American officers...?

MATLOCK: Oh, yes, we had all kinds of material flowing to the embassies from Tick's office. And certainly all those things were part of the package, we didn't call it a package, but then John the Baptist wasn't called the Baptist until after he was dead.

MCKINZIE: That's true enough.

And in 1950 when the emphasis was so much on the rearmament of Western Europe, was there any talk at all about social objectives of NATO? There are social clauses in the NATO treaty.

MATLOCK: Yes, we kept talking about them every time there was a ministerial session. I mean for the top level cabinet people. Something was always done, and maybe three "wise men" would be appointed

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to see what could be done to give balance to the treaty of alliance so that there would be social and economic things going on side by side with the military. And nothing much ever came of it, same as SEATO.

We had a project every year for SEATO, like the Cholera Research Center which was and is a very good project. We were going to do it anyway, but SEATO needed a project, so we put it in. Same problem: balance out the military with something civilian and peaceful and all that. The reason was more cosmetic than substantive.

MCKINZIE: Well, was the social clause in your opinion just necessary for acceptability in the countries that were participants or was there something more than that? I understood the Canadians were very, very concerned about...

MATLOCK: The desire for social and economic balance in the treaty was real, but what you have to remember is that everybody was being social and

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economic on his own national initiative. What they had to do that was new was create a defense. You don't have to make people be social and economic, but you have to bring some pressure to bear to run conscription in a dozen countries and train armies for defense in the event of attack by an enemy. So, the hard things were the ones that got the attention in NATO, and then of course you've certainly dealt with the question of the EDC, European Defense Community. Have you ever had an estimate given you by anyone as to why the French proposed the EDC?

MCKINZIE: Well, it would enable Germany to contribute to the cost, without contributing large amounts of troops...

MATLOCK: If they could be persuaded. But there is more to it. EDC, technically, was a coalition army. The Committee of European Jurists wrote a very fine report on that for the group that meets at Strasbourg, you know. It's worth looking up.

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It was published, and they decided that essentially the proposal was for a coalition, that the integration aspect of it was overrated in the publicity about it. They analyzed it and I read their report with interest. But my opinion is that the French proposed the EDC to delay German rearmament and for no other reason. NATO, if it had adopted the American proposals, would have brought the German Federal Republic into NATO on a national basis with national forces. And the French said, Alphand said, that of course the French knew that an ex-enemy couldn't be held down indefinitely, but there was a virtue in doing it as long as possible. That's about the essence of it. I think he used words very much like that in terms of delaying and limiting Germany rearmament. So, German rearmament was not welcome to France. It was not entirely welcome to the British. There were also strong elements against it in the U.S. Government.

In any case, the French found themselves up

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against it. When Acheson and his top level crew in New York in September 1950, at the time of the United Nations meeting (but of course not in it), proposed German rearmament -- this was no doubt in a secret meeting -- the French blew their top and made public statements denouncing the whole idea. From then on it was negotiation.

Well, it was getting to the point where the French weren't really blocking NATO movement. They needed a stalling device. So they proposed a European army to be called the European Defense Community. And they proposed that it be negotiated in Paris with France as the host government and chairman of the negotiations. And then they set about negotiating the EDC for about three years. And when the EDC was negotiated it had to be ratified. So finally it had been negotiated, and it had been ratified by everybody but France, which had proposed it and negotiated it. And then along about February 1954 the French Assembly killed it. That delayed German rearmament from 1950 to 1954

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and in my opinion that's what it was for.

MCKINZIE: All along.

MATLOCK: All along, from the first day. Unless an historian gets down to the question (he can decide I'm wrong), but unless he gets down to that question what was it for, he will be losing a main point. Now, in addition to its being for that, since the French were proposing it, and against the possibility that it might somehow get ratified, they had to build in a certain French preeminence, and French leadership would be a normal thing for them to hope for. But the EDC was in fact a reasonable arrangement, and we were strongly in favor of it, but our being in favor of it wasn't enough to get the French Socialists to vote for it.

Now, look at it this way. Dulles said the EDC was the only way to rearm Germany. He said it publicly. Our organization, Draper, was working on that premise. Some of us on his staff

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said, "If everybody does everything that everybody can do for the EDC, it has a 50-50 chance at best of getting all of the ratifications."

Now, if the U.S. had been Machiavellian (we weren't, we were very forthright about the whole thing), we might have gotten the French ratification. We told everyone the Dulles position, i.e., that the EDC was the only way available for German rearmament.

Now, the Social Democrats in Germany wanted German rearmament within limits. They didn't want to be excluded from NATO and excluded from European defense arrangements, so when they were told that the European Defense Community was the only way of rearming Germany, they cooperated to get the Karlsruhe decision (West German supreme court) that it was constitutional for Germany to have a defense force of the kind proposed. Then they voted with the Government, the governing party, Adenauer's Christian Democrats, to ratify the EDC.

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So then everybody had ratified the EDC but France. But the rack-up of votes in the French Assembly by our fellows in our embassy in Paris showed that there were 50 French Socialist votes (that's anti-German), of which at least 25 would be needed to ratify the EDC. And we knew that for at least six months and maybe a year before they ever voted on it. I don't remember now.

So, the thing would have been to tell the French that we had told the Germans that EDC was the only way to rearm Germany because we preferred the EDC and didn't really want an independent German army stomping around and conceivably threatening France, but that we had a reserve position which was to bring West Germany directly into NATO with national German forces if the EDC were not ratified. So when the French National Assembly was voting on EDC ratification, it should remember that a vote against the EDC would be a vote for a German national army. That would have put it through the French Assembly. But we didn't.

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Now, if you tell a man who wants Germany never to be rearmed, and who has the crucial vote, that he holds the vote that will defeat German rearmament, he'll use it. And so the EDC proposal died where it was born, in France. And then Dulles sulked in his tent like Achilles (I don't mean Ted, but the other one). According to the newspapers -- this isn't internal, this is just press stuff I'm judging by -- Dulles sort of glowered from Washington and Anthony Eden took his own briefcase and went around the next week to all the principal NATO governments and got them all to agree to bring in West Germany into NATO on a national basis. So, to me, the EDC was simply a French effort to delay German rearmament, and it succeeded for four years.

MCKINZIE: Do you think that the EDC in any other way, any way other than slowing up the development of the German components, slowed the growth of strength of NATO?

MATLOCK: Not too much, no, I don't think it had too

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much influence. Parallel to the French desire not to have Germany armed, there was a German desire, a young German desire, not to have any part of it, and that helped the French point of view. There was the Ohne Mich (without me) movement, and that, I think, slowed up the German side of it enough to please the French. It was enough so that if we hadn't had EDC delays or had been trying from the outset to negotiate Germany in with an army, we might have gotten Germany in formally, but we would have been a long time getting the German army going, something like that. It would have been a real impediment to development of the German force, this Ohne Mich attitude.

MCKINZIE: Obviously you had to be concerned a lot with the rearmament of Germany, but there is another element of this.

MATLOCK: Yes, the German problem was the heart of the Europe problem.

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MCKINZIE: Yes.

MATLOCK: That's a quote from Churchill about 1952 and I happen to agree with it as of that date.

MCKINZIE: Until 1950 it appeared that very many people in the State Department did not particularly see it that way.

MATLOCK: You mean they didn't favor German rearmament?

MCKINZIE: They didn't favor German rearmament or German industrial redevelopment very much.

MATLOCK: That's right, the whole U.S. policy until 1950 was to hold Germany down and deny it military strength. The British were still dismantling German industry as reparations when I went to London. They were getting the stuff out. Germany was trade competition. The British always thought about trade. They don't much anymore, but they did then. So they were among the last I think to stop dismantling German industry.

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Well, you know, I was just a staff man, I didn't raise any objections to the demilitarization policy. I don't remember thinking there was anything wrong with it.

MCKINZIE: There was some talk too that unless Germany were given a full part in NATO that the influence of the occupying powers would begin to decline, that there was a kind of natural life of occupation after which you get out and make friends or you...

MATLOCK: That's right. Well, there was a real issue within Draper's immediate staff, and David Bruce's staff, involving me and Tommy Tomlinson and some others. One point of view, which I espoused, was that the occupation was over. The Contractual Agreements had not been signed, but I said, "The occupation in substance is over. We have told Germany (the West German Federal Republic of course) that we want it for a partner in alliance against Russia. The occupation is therefore over,

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forget it. All we do now is negotiate our way out of it and we are going to have to treat Germany as if we were in favor of reunification. Politically we have to be in favor of reunification. The Germans will not expect us to go to war about it, but they will expect us to be really in favor of reunification of Germany, not just lip service." That was what I was saying, and some others too.

And then there was another point of view that we should keep Germany occupied for another ten years if necessary to get the EDC ratified and so on.

Draper was quite clear about it. He could see the picture quite clearly and he didn't hold any false hopes about holding Germany down or he didn't want to. Once the U.S. Government had told him that Germany was going to be a partner, then he had to act as if we were going to negotiate a partnership, which indeed we were. But then, around the partnership, there was in NATO a framework

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of strength and opportunity, so that Germany could have a big part in