The United States Political Adviser for Germany ( Murphy ) to the Secretary of State

403. Reurtel 333, August 23, 7 p.m. CRAB and its various subcommittees have ceased to operate on theory that the various functions should be transferred to quadripartite organizations yet to be formed. At present, matters involving the three Western Zones are being handled on an ad hoc personal basis between the Military Govt officers concerned. There is no operating procedure for consultations and meetings. Thus our telegram 33580 did not envisage use of CRAB facilities.

However, formation of quadripartite organizations and principles of “agreed imports” is currently being delayed by Soviet insistence upon prior clarification of reparations problems.

Sir Percy Mills81 of the British element has already indicated, in the Economic Directorate of the Control Council, that the British, in the absence of quadripartite action, favor a tripartite approach to a variety of problems including exports and imports. This would seem to imply a willingness to allow exports from the British zone to be utilized to cover part, at least, of the trade deficit which appeared [Page 1527] likely from the American zone. Inasmuch as imports from neutrals and from United Nations, as well, appear to be prohibited under the terms of the Potsdam Agreement, until they become “agreed imports” through appropriate action by the Control Council, we are in the process of attempting to obtain a clarification of British views and of reactions within US Group CC (Control Council) and will cable further.

In the meantime it would seem desirable that Joint Chiefs of Staff 1067 article 41 (C)82 be amended to avoid the US prohibition on exports to others than United Nations.

  1. Dated August 21, p. 1523.
  2. Head of the Economic Division, British Element of the Control Council, and British representative on the Economic Directorate of the Control Council.
  3. Reference is to the directive issued by the Joint Chiefs of Staff to General of the Army Dwight D. Eisenhower, Commander in Chief of the United States Forces of Occupation, regarding the Military Government of Germany. The first version of this document, dated September 22, 1944, is printed in Foreign Relations, The Conferences at Malta and Yalta, 1945, p. 143. Subsequent revisions leading to the issuance of the directive in May 1945 are covered in documentation on “Participation of the United States in the work of the European Advisory Commission,” part III, ante, pp. 369533, passim. For the April 26 version of the directive (IPCOG 1), see p. 484; for text as released to the press October 17, see Department of State Bulletin, October 21, 1945, p. 596.