Vienna, July 19, 19S5.

Dear Mr. Phlllipei

The outstanding developments la the Austrian situation since I last wrote you are the cheering effects of Hoare*a speech in the Commons some eight $ays ago, out­lining Pritish policy, and the unfortunate automobile acci­dent in which Chancellor Sohusohnigg had an almost miraculous escape but in whioh Mrs« S ohuschnigg lost her life.

I have reported on the facts of this automobile aocident in my despatch No. 497, of July 18, but a little more intimate comment may be of interest. Just two days be­fore tha accident tha Argentia# Charge here, who is one of my good friends and who is going to Japan aa Minister, gava an informal farewell dinner at a restaurant in the Tfilenerwald. The Chancellor and Mrs. Sohusohnigg and tha Foreign Minister were there and aontrsry to their usual custom the Chancella* and Mrs. Sohusohnigg stayed until after midnight. It was, I think, the happiest party that they had been %• since ha became Chancellor* Z saw a good deal of Mrs. Sehusehnlgg that evening and she wag tailing me with what eagerness they were all looking forward to leaving on the following Saturday for a little holiday, and she was like a child 1 B her enthusi­asm that her husband would be able to stay with her a few days. She was only thirty-four and a vary intelligentf pleasant, charming, and simple woman. My wife and X wera as much attach­ed to har aa we are to anyone in Vienna, and she reciprocated this and used to talk to aa) very frankly* She was haunted by tha constant fear, aa Frau Dollfuss had been before her, that har husband's life was in danger. The Chancellor and lila wife had an unusually happy married lifa and their devotion to each other v/as often a subjeot of aomment among their friends.

I waa lunching with the Chinese Minister on Sat­urday when I was called to tha telephone and told ay a friend that the news had just come of the aocident* I immediately got in touoh with my French and Italian oolleaguea who I knew

The Honorable William Phillips,

Under Secretary of State, Washington, D. 0*

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would be the most accurately informed concerning any possi­bility of the seoldent's being the result of foul slay. X was able) already at three o'clock to •elegraph the Department that the Chancellor was uninsured and that Mrs. Sehueohnigg was dead and that it was pur© accident.

It was quite* natural that the eubjeot of foul play should arise as it wis only last year is July that Chan­cellor SollfuM was assassinated. Concerning the fidelity of the chauffeur there apparently waa no question for he hod been with the Chancellor for a considerable period and was deeply attached to him. Besides h© wai so seriouely injured that hia life was despaired of for several days and when ho was able to speak what ha oould say cleared up the possibility that ho had been taken suddenly 111 and as a consequence lost control of the cor* The impact of the oar against the tree practically destroyed the oar, but the most careful examin­ation of the wreckage doo» not discloso that any part of it had been tampered with. In splto of this, of course, there has been much speculation in the press outsido Of Austria that the car may have been tampered with, and while no one eon definitely say that it waa not, it la practically certain that It waa an accident. Certainly from Nazi sourees it was unlikely that they would wish to get rid af Sehusohnigg in this way as he would certainly be replaced by Starhemberg from whom they oould expeet less toleranee than from Sehusohnigg.

There has aleo been a good deal of speculation that the Chanoellor may resign •• a result of thie aocidont due to his having suffered a aevera nervoua shook and being anxious to have • less responsible position. X have seen the Chancellor at least three times since the accident. He has not suffered serious physical injury. He has had a severe nervous shock and his hair has turned almost white In a fan days, out If I know the man, whioh X think X do fairly well, thero la no question but that ho will apply himself more assiduously than ever to hia job. Si la a man of very obstinate character with a real devotion to his responsibilities and almost devoid of personal ambitions. Even If ha had a desira to get rid of hie responsibilities, whioh X am sure at times he has, the eireumstaneea ara such that he could not possibly do to now. Tha aackgrouad which I have given in

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previous, tetters and despatches concerning the Austrian situ­ation aakea it elear that ©very effort ia made here to mai»» tain the status qus and the Chancellor would not retire unless there mere controlling eireunttanees which do not teem t* •»-1st.

1 think we may take it that the result of the accident is only to strengthen the official and personal posi­tion of the Chancellor.

There it one feature of this matter which I think I should call to your ttttentio* snd which I neve already very briefly referred to i» my despatch on the aeoident. I fore­saw the general sympathy which the Chancellor's bereavement would arouse not only in Austria* but in other oountries, and in my telegram reporting on the accident I took the liberty of suggesting that a message of sympathy be sent by our Govern­ment. The death of Mrs. Sohuschnigg did arouse unusual mani­festations of sympathy in the oountry, end telegrams kept pouring in from all over the world and most of my colleagues here were instructed tooall personally at the Foreign Office to present the sympathy of their Governments or direct tele­grams were sent. I have thought it advisable not to ask even informally at the Foreign Offloe whether any message was re­ceived from us, but as the published accounts have listed the visits and telegrams very fully, and as there it no mention •f anything from us, there is a possibility that we did nothing. I called at the Chancellor's office late Saturday afternoon of the accident and put my name on the book which was open for that purpose, and in view of the friendly relations which my wife and I had with the Chancellor and Mrs. Sohuschnigg, I sent him a personal not* of sympathy.

If we did send nothing here I think it will he noticed and I son wondering whether wo did send anything and if we did not, whether there is anything in our procedure cus­tomary under such circumstances which would prevent us from doing so* I would be very glad If you would let me have just a word shout this as it would he helpful for my guldenoe in the future.

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The speech of Hoare la the Commons iome eight daya ago had • very profound effect here* There ia no questionthst there ia no country over here whieh speaks with greater authority than England. And aa I have tried to point out continuously, her attitude ia the deciding factor in major policies over here. Aa I wrote you, the Government here was remaining extraordinarily eelm and undisturbed by the unfavor­able turn whioh things had been taking before Hoare* a speech* But Hoare*e statements, particularly with respect to Austria, removed any uncertainty whioh was fait here* It waa a splen-did document and in my opinion will do a tremendous lot of good*

Hoare* a statement with rftHpaet tteVAustrla we* the clearest whioh the British Government has made in this respect. I happen to know that the Government here had never lost its confidence that It would tventually have definite British sup­port* in the maintenance of Austrian independence, but the statement of Hoare went ••en farther than waa expected here. The Foreign Minister issued a statement in which he expressed officially the appreciation of the Austrian Government of the attitude whioh I&gland had taken on the question ef Austrian Independence.

It is felt here now that the obstaolea to the Danubian paotamay be removed. Ulth England giving these pacts her open blessing, the remaining obstacles become less formidable. S doubt, however, whether there will be any fixing of the date of the Rome tenferenee until the Abyssinian question is further cleared up. If it comes to. actual hos­tilities in Abyssinia, it Is difficult to aee how the con­ference can be held in anything like the near future. The other major question in the way, that of the arrangements between Italy and Yugoslav!* creating the possibility for Italian troop movements through Yugoslavia in case of aggress­ion against Austria, is, I am told, on tne way towards being overcome. Hoare*s speech did a great deel to facilitate this, but I doubt whether anything definite will be don© by Yugoslavia until the question of Abyssinia Is cleared up.

I am one of those who believe that the Danubian pacts are one of the essential steps in order to prevent war la Europe. With England's attitude clearer I believe that

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the way will be definitely open towards these peets one* the Abyssinian question is out of the way. I saw here is Vienna recently one of ray German friends who is oxtraordi-narily well Informed and he seemed to be of the opinion that the wituation was already such that Germany might be prepared to become a party.

One of the principal causes of concern here now is that it may come to actual conflict la Abyssinia in spite of the negotiations under way, with which you are rauoh mors familiar than X* The feeling here Is that set* ual conflict will bring difficulties for Italy which will only further complicate th# situation and which may even be serious*

In general the s ituation tM Austria remains quiet snd is developing satisfactorily. The economic ilt* uation oontinues slowly to improve and Austria Is going to have the best tourist season that she hat had slnoe the war. There seems to bo no likelihood of any unpleasant or disturbing developments la tho internal situation for the foreseeable future.

1 hsve eovered the Hsbsburg question snd all the baseless rumors which have recently appeared so thoro­ughly in my recent despatches and letters that I aolieva it it not neosisary to go into this matter further for there is no change in the fundamental situation as I have outlined it.

I have had some interesting information recent­ly concerning the developments in Germany, but unfortunately the poueh is leaving In an hour snd I shall not he sble to get anything off to you this week on this subject* As X have indicated in my letters* the economic and financial situation are becoming more serious and the radical elements in tho Party becoming more aotivo in pressing the social program. There is a good deal of significance happening there now and I will send you the information whioh I have reoeived and the Interpretation whioh I can make by the next pouoh.

With all good wishes*

Cordially and faithfully youra*

George S. Messersmith.