861.9111/2–1049: Airgram

The Chargé in the Soviet Union (Kohler) to the Secretary of State

restricted

A–136. A survey of published articles since December 1 reveals that at the turn of the year the Soviet central press noticeably intensified its propaganda concerning the oncoming economic crisis in the United States. Although this theme is not a new one, the allusions to the U.S. crisis have suddenly become so numerous as to permit the inference that a concerted press campaign on this topic was ordered about January 1st Between December 31st and January 16th, there were [Page 570] only three days on which the Soviet press did not discuss growing US unemployment, falling production, crisis fears and related subjects.

[Seven brief, illustrative excerpts typical of the comments appearing in articles in Soviet newspapers are not reproduced.]

In general, this campaign has run through three stages. Hints of US economic disaster first appeared in connection with a flood of articles at the beginning of the New Year which sought to impress upon Soviet readers the happy distinction between their favored lot and the gloomy outlook of the workers of the Western capitalist states. Later, President Truman’s “State of the Union” message was seized as an opportunity to dwell upon unfavorable conditions and economic prospects in the US, and the favorite device of citing statements out of context was skilfully applied to Truman’s message. More recently, the press treatment has reverted to Tass reports of increasing unemployment and the fall of prices on the stock and commodity exchanges in the US during the first weeks of February.

Articles appearing in the Moscow press this past week are illustrative of the most recent phase. On February 6th, Pravda printed a New York Tass report of a sharp decline in stock quotations and wholesale prices which “attests to the weakness of the economic situation of the USA and to fears for the future.” This was followed on February 7th by a similar Tass report of falling stock market prices; on February 8th by a ¾ column article entitled “Worsening of the US Economic Situation”, which described rising unemployment, on the basis of a recent report of the Bureau of the Census, and reduced production; on February 9th by a Tass report of a continuing decline in wholesale prices; on February 10th by a Tass report that the US was again threatened by mass unemployment; and on February 11th by a ⅔ column article entitled “The Economic Situation in the USA” which reported that business circles were alarmed at the recent price drop, believing it indicated an unstable economic position.

It would appear from the amount of attention being given to this subject that expectations of a near-future economic crisis in the USA are still a priority factor in Soviet thinking, and the slightest evidence that their dreams may be coming true are being seized upon eagerly.

Kohler