Stalin was flexible but hopeful about a Red future for Austria, perhaps more than has been suggested by those who claim he had never wanted or intended to turn that country into a “people’s democracy.”67 The Soviet Union continued to supply advice and generous funding for the Communists there—in 1953 around $530,000, a considerable sum for the time—and only slightly less than that provided to the French party. If the KPÖ had been able to mobilize the electorate, then the Kremlin might have been willing to risk more. After the elections in 1949, in which the party barely obtained 5 percent of the vote, the lone Communist was dropped from the government.68 By that time, whatever distant hopes the Soviets might have had for Austria and Western Europe were on the wane.
STALIN’S PLAY FOR TIME RUNS OUT
The Kremlin dictator was intent on making the most of the peace treaty negotiations, but the victors argued among themselves about what the losers would pay. Stalin was decidedly against the recovery of capitalism in Germany and advocated the harshest terms, including a four-power division of its industrial heartland in the Ruhr, a resource-rich area also important to France, Belgium, and the Netherlands. With a Soviet foothold in the Ruhr, so this thinking went, Germany would be permanently incapacitated.
The United States and Great Britain opposed the Soviet Union in Germany. Much of the slogging was done by U.S. secretary of state James Byrnes, a man with little international experience and one notorious for working on his own. In a sense, he “won” against the better-prepared Molotov, because in Western Europe, in free elections, people decided for themselves that they wanted liberal democracy, not Communism.
The peace treaties were to be negotiated by the Council of Foreign Ministers, which was created at the Potsdam Conference. It met every three months in sessions that went on for days and weeks. Secretary Byrnes had been upbeat when he left for the first round in London in September 1945, but discussions bogged down, thanks mainly to Molotov, the nightmare at the negotiating table. The gatherings were like a war of attrition that ground away at Secretary Byrnes and his British counterpart, Ernest Bevin, both of whom developed health problems.69 Molotov questioned everything, from lofty political principles down to the tiniest details, and he did so again when the foreign ministers met in Moscow from December 16 to 26. A keen observer noted that Molotov was in his element, his “eyes flashing with satisfaction and confidence” as he glanced around the table. Ruthless and incisive, he “had the look of a passionate poker player who knows that he has a royal flush and is about to call the last of his opponents. He was the only one who was clearly enjoying every minute of the proceedings.”70
Byrnes spoke with Stalin over dinner on Christmas Eve and sought to assure him that the United States would not retreat to isolationism, that it would stay in Europe and join the other three powers to keep Germany demilitarized and thus allay Soviet fears of another invasion. Stalin called it the best proposal he had heard and hoped that Byrnes would fight for it.71
In 1946 there were two sets of meetings in Paris, the first from April 25 to May 16. French foreign minister Georges Bidault was eager to discuss Germany because his country aimed to get reparations, perhaps part of the Ruhr, and access to the Saarland. Molotov’s goal was to have the occupation of Germany last as long as possible, get a four-power division of the Ruhr, and receive the oft-mentioned $10 billion in reparations.72
However, the welfare of the people in occupied Germany was worsening, and the United States and Great Britain felt increasingly forced to do something. Since November 1945, millions more destitute ethnic German refugees had been flooding in from the east, and to make matters worse, the USSR was insisting on immediate reparations in their zone of occupation and demanding all it could get from the Western zones. On May 3, 1946, after more fruitless discussions on the Allied Control Council in Germany, the U.S. deputy military governor announced a halt to further deliveries of reparations from the American zone.73
At the next session of the Council of Foreign Ministers, in Paris (June 15–July 12), Molotov, in a speech prepared in close consultation with Stalin, rejected U.S. proposals to keep Germany disarmed and demilitarized. Although the Soviets, and also France, wanted a four-power administration of the Ruhr, Molotov suggested that the West wanted to separate the natural-resource-rich Ruhr from Germany. His key admission on July 10, however, was that it would be years before a German government could ever exist, and only then would it be possible to work out a peace treaty.74
On a related matter, Foreign Secretary Bevin said Britain could not continue financing its zone, and he proposed more interzonal cooperation, to which Molotov gave a firm no.75 Byrnes was annoyed that Molotov kept presenting himself as defending Germany against the vengeful Americans. Of course, Byrnes recognized that Molotov was making a clever political appeal to Germans, who still feared the vengeance of the Morgenthau Plan. He said that the United States was far from wanting Germany’s division and was prepared to “join with any other occupying government or governments for the treatment of our respective zones as an economic unit.” It had become untenable to continue administering Germany “in four air-tight compartments.”76
On July 11 Byrnes invited “all his colleagues,” including the Soviets, to join in an effort to merge the zones; something had to be done to deal with the country’s growing economic chaos. Britain agreed the next day, while the Soviet Union and France hesitated. On December 2 the British and Americans announced their odd-sounding German “Bizonia,” which became operational on New Year’s Day.77
The Council of Foreign Ministers meeting in New York (November 4–December 12, 1946) finalized peace treaties with most of the former Axis powers, though no progress was made on Germany. When Byrnes resigned for health reasons shortly afterward, President Truman named a replacement in General George C. Marshall. The new secretary of state flew to Moscow to take up where Byrnes left off at the next gathering of the foreign ministers, scheduled for March 10 to April 24.
The Soviets kept demanding immediate reparations, also from the Western zones. However, the level of production and subsistence there was already so low that the only way they could have been paid, as French foreign minister Bidault admitted, was for the United States “to increase its aid and subsidies to Western Germany.” In effect, the United States would send funds or goods in the front door and the Soviets would shovel them out the back, with the Germans just as badly off and sinking into chronic dependency.78
Bidault recalled that Stalin was only too willing to cooperate with France when it came to dividing the Ruhr area into four zones, after which what had happened in Berlin would be repeated. The Soviets “would have looted their section,” encouraged all the workers to revolt, and production would have fallen drastically. That was how Bidault saw things, and he knew perfectly well that France would still not be getting access to the coal it desired; the U.S. would have had to persist in subsidizing the area, while in the meantime the reach of the Soviet Union would have been extended as far to the west as the Rhine.
Marshall realized that this arrangement was a losing proposition and could not agree to it. He found Molotov every bit as obstructionist as had Byrnes. What should the United States do? By common consent, the so-called Truman Doctrine was not taken seriously, and the foreign ministers were getting nowhere. Marshall decided a new response was needed, but he was unsure what that should be. Not just Germany but all of Europe was in a mess, with no end in sight.79