No. 336
The Assistant Secretary of State (Clayton) to the Assistant Secretary of War (McCloy)

My Dear Mr. McCloy: In recent conversations with representatives of the War Department, officers of the Department have been informed that the War Department does not consider itself responsible for exports from Germany except to the extent that the goods exported [Page 469] serve to meet some direct military use or responsibility. Consequently, in the judgment of these representatives, the War Department would not be able to finance the procurement of supplies needed to increase German production for export other than in the limited circumstances in which the military authorities have a direct interest in the goods exported.

The point came up in connection with a discussion of measures necessary to ensure the increased exportation of coal from Germany to the liberated countries of Northwest Europe. As I understand it, the War Department representatives recognized that an obligation rests upon the military authorities to see that coal is exported from Germany to these countries so long as SHAEF is responsible for the distribution of coal in Northwest Europe. However, once the period of military supply responsibility for Northwest Europe is terminated (as will soon occur), it was their view that the responsibility of the military authorities in Germany would be limited to ensuring the production only of the minimum amount of coal needed to prevent disease and unrest in Germany.

The expression of this narrow view of the responsibilities of the military authorities in Germany has caused considerable concern to the Department. It appears to me so clearly inconsistent with the directives which have been issued to the Commander-in-Chief of the United States Army Forces of Occupation in Germany,1 that it seemed desirable to inquire whether it does in fact represent the considered view of the War Department. Under the directive to the Commander-in-Chief approved by the President on May 11, 1945 (IPCOG 1/4),2 he is directed in his dual capacity as United States member of the Control Council and commander of the American zone of occupation to carry out certain basic objectives of United States policy. These include the provision of relief for the benefit of countries devastated by Nazi aggression, and the directive orders the taking of all feasible measures to facilitate the production of coal and, subject to certain limitations, other types of goods and services needed for this purpose. Since only the military authorities are in a position to implement this directive, it has seemed to us that the responsibility for determining what imported supplies are needed to make use of German resources for this purpose must be determined by the military, and that the responsibility for procurement of such supplies must rest with the military.

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It is the State Department’s view that for the period of Allied military government in Germany, the procurement and initial financing responsibilities of the military authorities with respect to imports are not limited to consumption of occupying forces, displaced persons, and such minimum consumption by German civilians as are necessary to prevent disease and unrest, such responsibility should include all imports which serve the purposes of the United States government in Germany. This responsibility, moreover, in the view of the Department, extends to the United States’ share of any combined financing which may be undertaken in concert by the occupying powers. As you are aware, it has been decided as a matter of government policy that this Government will seek to make the reimbursement of all expenses incurred by it in importing supplies into Germany a first charge on German ability to make foreign payments.

I should very much appreciate receiving your comments on this matter at an early date.

Sincerely yours,

W. L. Clayton
  1. General of the Army Dwight D. Eisenhower.
  2. This paper circulated the text (approved by Truman on May 11, 1945) of a “Directive to Commander in Chief of U. S. Forces of Occupation Regarding the Military Government of Germany”. A slightly modified version of this text is printed in Department of State Bulletin, vol. xiii, p. 596.