740.00119 EW/11–2244
The Acting Secretary of State (Stettinius) to the
President
top secret
[Washington,] November 22,
1944.
Memorandum for the President
Subject: Economic Treatment of Germany
At the time that you redraft the memorandum on the Economic
Treatment of Germany you might find the attached memorandum
useful.
[Page 173]
[Attachment]
secret
[Washington,]
November 22, 1944.
Subject: Summary of Department’s Views on
Economic Treatment of Germany
The Department of State believes:
(1) The German economy should be operated as nearly as
possible as a unit during the
occupation period.
(2) Allied occupation policy should be severe—
- (a)
- a rock-bottom standard of living for the
Germans;
- (b)
- labor services for the rehabilitation of
devastated parts of Europe;
- (c)
- transfer of such industrial equipment and
stockpiles as liberated countries can put to
effective use, limited only by necessity for
maintaining a minimum German economy;
- (d)
- conversion of the German economy to peacetime
production, including production for minimum German
needs and for reconstruction of rest of Europe on
reparation account;
- (e)
- elimination from positions of control of those
industrial and financial leaders who have been
closely identified with the Nazi regime or who have
derived large benefit from Aryanization or
spoliation of occupied countries.
(3) We must rely on an effective international security
organization to keep Germany disarmed. We can’t make Germany
so weak that it will be impossible for her to recover. A
look at Russia in 1920 and in 1940 demonstrates how quickly
industrial strength can be built up if a country is left
alone “to stew in its own juice”. Disarmament requires
prohibition of arms and aircraft production and destruction
of specialized facilities for their manufacture. Some other
permanent or semi-permanent industrial restrictions and
controls may be necessary, but if the security organization
is prepared to use force to prevent rearmament, we don’t
have to cut deep into the German economy, and if it isn’t,
no amount of once-and-for-all economic destruction will make
much lasting difference.
(4) In the long run, we should look forward to a German
economy geared into a liberal world economy on the basis of
efficient specialization. This will imply equitable German
access to export markets, abolition of German
self-sufficiency, and abandonment of instruments of German
economic aggression—private international cartels, bilateral
barter arrangements, etc. This alone is compatible with the
emergence of a stable non-aggressive Germany. This may prove
to be unattainable, but for the present we should take no
action which would permanently preclude peaceful development
of Germany.
