740.00119 Control (Germany)/6–1847: Telegram

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


1473. With reference to previously communicated joint memorandum from US-British delegations notifying Allied Control Authority of bizonal economic reorganization, Soviet member33 at 125th Coordinating Committee meeting June 17 delivered sharply worded attack in prepared statement reading substantially as follows in faulty translation. Bizonal reorganization creates great concern for fate of political and economic unity of Germany. Agreement does not envisage implementation of Potsdam Decisions for liquidation of war industrial potential, reparations, elimination of Fascism, etc. Agreement leads to political and economic split of Germany. At Moscow CFM Molotov suggested termination of US-British bizonal arrangements. Soviet attitude therefore well known. Reserving right to return to question at a later date, Soviet delegation must state that the latest bizonal arrangements are aimed at further accentuating the split of Germany and not only represent a departure from Potsdam Decisions but contradict the agreed decisions of Moscow CFM. It is quite clear that the reorganization of economic agencies involves the creation of a special governmental system for western Germany. Measures taken by US-British authorities cannot but create difficulties for further work of deputies as well as of next CFM.

British member34 rejected Soviet statement as baseless and pointed out new bizonal agreement is purely economic and makes no mention of political fusion. As regards the present economic state of Germany, it remained open to the Soviets to heal this split at any time.

US member35 reserved right to study official text of Soviet declaration since some of the statements contained in translation bordered on impertinence. He stated Potsdam Agreement emphasized economic unity and that Soviet delegation should read that text and adhere to it.

French chairman36 concluded discussion by stating he had studied the structure of the newly created bizonal economic organization and that he was of opinion they [sic] in no way prejudice the future.

Sent to Department as 1473; repeated to London as 222, Paris as 252.

Department please relay to Moscow as 366.

  1. Lt. Gen. Dratvin.
  2. Maj. Gen. Brownjohn.
  3. Maj. Gen. Keating.
  4. Maj. Gen. Noiret.