Matthews Files
The Chief of the Division of Central European Affairs ( Riddleberger ) to the Secretary of State 1
At a meeting yesterday in the War Department on the interim directive for Germany in which representatives of State, War and Treasury participated, there were several developments of which I think you should be apprised.
The Treasury representatives were Messrs, Pehle, Luxford and Taylor. In the course of the discussions, they made it altogether clear that in their opinion the Treasury Department, as a result of the establishment of the Cabinet Committee on Germany, should be consulted on all phases of German problems, including both political and economic. They participated vigorously in the discussion on the political directive and insinuated that the Treasury plan for the treatment of Germany had received the approval of the Cabinet Committee and the blessing of the President. They stated flatly that the economic documents, as approved by the Executive Committee on Economic Foreign Policy, had been repudiated both by Secretary Morgenthau and Secretary Hull and that no further attention was to be given to these papers. They requested that certain other confidential memoranda be transmitted to them at once and implied that henceforth all such material should be immediately made available to the Treasury Department. In general, they took the line that henceforth the Treasury must be consulted on all important matters respecting Germany and that that was the purpose of the Cabinet Committee.
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