Status of Berlin, May-December 1960 579



    Mr. Lucet said this was a difficult issue, not only in view of internal
German trade, but because to be effective economic countermeasures
could not be applied on a tripartite basis or even on a NATO basis, but
would have to be done by all Free World countries.
    Mr. Merchant said we recognized the difficulties in enforcing eco-
nomic countermeasures, but we feel very strongly on this issue. Last
month's events, when the GDR took restrictive actions, something we
had feared for a long time, had emphasized to us the necessity for taking
an effective counteraction against the GDR, taking an action that would
hurt them. In the absence of effective counteraction, we are going to be
faced with continuing and increasing restrictions, a nibbling away of
our position. We admit that the Federal Republic has the greatest eco-
nomic leverage and that they have to take the original action. We must
be prepared to support them, not only on a tripartite basis, but on a
NATO and COCOM basis. We also admit that this is a delicately bal-
anced choice, but we have to take risks in this instance.
    Mr. Kohler stated that, while the first two moves taken by the GDR
were not in themselves substantially important, they would become a
legal basis for succeeding and more damaging moves. It was like the ar-
gument on the problem of stamping travel documents where we had
agreed that the decisive moment was the very first step of placing the
GDR stamp on the document. This was the act which would set in train
our whole series of countermeasures.
    Mr. Hoyer Millar said the British would be glad to study the issue,
but that the real problem was that of timing, i.e., when you first take ac-
tion. He pointed out that restricting steel exports would hurt the GDR.
    Mr. Lucet observed that we must not make the crisis more acute just
to prove we are resolute.
    There ensued a give-and-take discussion of German participation
in contingency planning, [less than 1 line of source text not declassified]
in
the up-to-now tripartite working group in Washington [less than 1 line of
source text not declassified].
    The British appeared to have the idea that German participation in
contingency planning would mean the reopening of the tripartitely
agreed plans.
    Mr. Kohler stated this was not the intention at all, that the Germans
have agreed with the planning to date. It was not our intention to reopen
the old plans at all.
    Mr. Hoyer Millar said the British would take a new look at this
problem and appeared favorable to German participation.