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SECRED
.4 #1397, September 16, 2 p.m.o from Paris
be embarking upon an enterprise doomed to fail through in-
flationary pressures which many of the other NAT countries
will be able to disregard to the added disadvantage of the
French economy
11. Consequently the French do not wish to finalize any
figures in detail until they know whether their medium and
long term efforts will have to be made essentially on a
national rather than on a cooperative basis. They also
do not wish to indicate whether other NAT countries might
contribute to France or vice versa until a common authority
under, NATO has made defin'te assignments in troop strength
and production to each country. It is likely that such asem
signments would bring many of the countries up to a level
of military expenditures approaching those contemplated by
the French for themselves.
only then could the financial share of the common effort be
estimated for each country.
12. As to the high priority production program the French
are going ahead in letting contracts. Although we have had
difficulty to date in extracting from them the information
required by Washington, I believe we will obtain it next
week. (In connoction with this program because of the terms
of the Congressional act appropriating MDAP funds, the
anomaly seems to appear that a nation contributing both
large troop strength and production and therefore taking on
a dispropertionate share of non-fabrication expenditures is
actually penalized as compared with a nation making the bulk
of its effort in the manufacture of military items The
French still hope to obtain our assent to non-fabrication
expenditures being taken into account by us in granting MDAP
assistance and this has held up the submission of a financial
proposition on the h' "h priority production program). Per-
sonally I have doubts as to the wisdom of their manufacturing
some of the present >riority items, but since decision in rea
gard to them lies in the military field, I have no comment
to make on that subject, except to say that as is no doubt
the case in our own and other armies this will result in
waste, duplication and loss of efficiency in the production
of weapons which ought to have been standardized.
13. In conclusion, it is my own belief that unless the
economic and financial burden of rearmament can be equitably
shared either all the gains achieved through the Marshall
Plan in France will be cancelled out by an inflation the
consequences of which expressed in deep social unrest and
even revolt will make the effective rearmament of Europe
impossible, or
HADRY S. TRIMAN LIBRABY
SECRET
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"ocrText": "SECRED\n.4 #1397, September 16, 2 p.m.o from Paris\nbe embarking upon an enterprise doomed to fail through in-\nflationary pressures which many of the other NAT countries\nwill be able to disregard to the added disadvantage of the\nFrench economy\n11. Consequently the French do not wish to finalize any\nfigures in detail until they know whether their medium and\nlong term efforts will have to be made essentially on a\nnational rather than on a cooperative basis. They also\ndo not wish to indicate whether other NAT countries might\ncontribute to France or vice versa until a common authority\nunder, NATO has made defin'te assignments in troop strength\nand production to each country. It is likely that such asem\nsignments would bring many of the countries up to a level\nof military expenditures approaching those contemplated by\nthe French for themselves.\nonly then could the financial share of the common effort be\nestimated for each country.\n12. As to the high priority production program the French\nare going ahead in letting contracts. Although we have had\ndifficulty to date in extracting from them the information\nrequired by Washington, I believe we will obtain it next\nweek. (In connoction with this program because of the terms\nof the Congressional act appropriating MDAP funds, the\nanomaly seems to appear that a nation contributing both\nlarge troop strength and production and therefore taking on\na dispropertionate share of non-fabrication expenditures is\nactually penalized as compared with a nation making the bulk\nof its effort in the manufacture of military items The\nFrench still hope to obtain our assent to non-fabrication\nexpenditures being taken into account by us in granting MDAP\nassistance and this has held up the submission of a financial\nproposition on the h' \"h priority production program). Per-\nsonally I have doubts as to the wisdom of their manufacturing\nsome of the present >riority items, but since decision in rea\ngard to them lies in the military field, I have no comment\nto make on that subject, except to say that as is no doubt\nthe case in our own and other armies this will result in\nwaste, duplication and loss of efficiency in the production\nof weapons which ought to have been standardized.\n13. In conclusion, it is my own belief that unless the\neconomic and financial burden of rearmament can be equitably\nshared either all the gains achieved through the Marshall\nPlan in France will be cancelled out by an inflation the\nconsequences of which expressed in deep social unrest and\neven revolt will make the effective rearmament of Europe\nimpossible, or\nHADRY S. TRIMAN LIBRABY\nSECRET"
}