Foreign Relations of the United States, 1948, Germany and Austria, Volume II

740.00119 EW/2–1748

Memorandum Prepared by the Department of State ¹

secret

[ Washington ,] February 17, 1948.

Terms of Reference for Working Group to Re-examine Plants Listed for Dismantling in the Three Western Zones of Germany ²

Together with representatives of the State and Army Departments, and in cooperation with members of the technical staffs of interested Congressional committees,

1.

a To ascertain which plants on the lists of plants scheduled for dismantling in the three Western Zones of Germany are technically equipped to produce items which are in world-wide short supply because of a shortage of productive facilities.

b To prepare a list as a matter of urgency, from among such plants (par. 1a), of those which should not be dismantled pending the completion of their examination, and to transmit this list to the Departments of State and of Army. Plants having very small production capacities should not be included on the list of plants the dismantling of which is to be suspended.

2. To examine all data available in Washington with respect to these plants. Such additional information as may be deemed essential for this examination will be requested from the appropriate zonal authorities by the Departments of State and Army. If desired, the working group is authorized to visit Germany for consultation with the zonal authorities.

3.

a To recommend which plants, if any, should be retained in Germany. These recommendations will depend upon whether it is feasible to bring the plants into production within the period of ERP without at the same time adversely affecting the achievement of either the coordinated reactivation of German industrial production or the production programs of the nations participating in the Committee for European Economic Cooperation.

b To make recommendations as to the appropriate types of plants which might be substituted for any plants which are recommended for retention in Germany. Actual designation of any particular plants to be substituted will be left to the zonal authorities.

1. The source text bears the typewritten notation “As Personally Amended and Approved by the Secretary 2/17/48.” A copy of this memorandum was transmitted to Ambassador Douglas in London under cover of a letter from Frank G. Wisner, February 17, 1948, not printed, which explained that the memorandum had not yet been submitted to the Cabinet, but that it was hoped that it would be accepted by representatives of the other interested Departments. The earlier draft of this memorandum was submitted to the Secretary of State on the morning of February 16, prior to the Cabinet meeting of that day (see memorandum by Wisner, February 16, p. 729). The Secretary chose not to present the memorandum to the Cabinet in its original form.
2. Representatives of the Departments of State, Commerce, Interior, and Agriculture, constituted as the Working Group on Reparations, met for the first time on February 18 and several times thereafter during February. Some difference of opinion appears to have arisen in the Working Group at these meetings regarding the terms of reference as presented here. Some members of the Working Group apparently considered that the terms of reference should cover reconsideration of the entire reparations program. Eventually, at its meeting of March 9, the Working Group agreed on its terms of reference as presented here. Documentation is sparse in the Department of State files on these early meetings of the Working Group. Such material as is available is included in file 740.00119 EW.