762B.00/10–2153: Telegram

No. 758
The Director of the Berlin Element, HICOG (Lyon) to the Office of the United States High Commissioner for Germany, at Bonn1


542. From EAD. Power position of SED and Soviets in GDR today as compared June–July is sufficiently altered to warrant reviewing current GDR situation as important consideration in analysis future Soviet policy re Germany.

Situation in GDR as of July characterized by shattering of SED Party’s internal position of control and by state of confusion and indecision in SED reaching into Politburo. East Germans, particularly workers, were still exhilarated by their newly won sense of power and lack of fear of SED. This found expression in such acts of defiance as fairly widespread work slowdown movements, sporadic work stoppages, expression of political demands and collection of food packages in West Berlin.

Although SED Party and GDR Government still have long way to go to regain effective control over internal developments, indications as of mid-October suggest they making progress. Obvious manifestations of confusion and hesitation of July are gone and replaced by an apparently firm policy. Policy framework within which SED now operating is dual one of political coercion and economic concessions. Most recent indication this duality was October [Page 1663] 16 announcement Council of Ministers decree reducing personal income tax against background of terror trials in which so far 35 have been sentenced including two death sentences, eight life imprisonments and average of nine years imprisonment for remaining 25. Defendants these trials were June 17 rioters and informants of West Berlin anti-Communist organization and not “bourgeois” elements, like landowners and businessmen, who figured prominently in trials prior June 9 shift in policy. Apparently SED authorities intend to honor for present reprieve granted these elements under new course.

Strong implication foregoing is that government and SED feel more secure now. Regime is attempting maneuver itself into position where new concessions made appear to flow from strong, confident and solidly anchored government rather than from weak, uncertain government under pressure from below.

Coercive-concessional policy has been developed against background of (a) purge and temporary reorganization of Politburo; (b) purge throughout party apparatus as step in direction organizing party for fourth party congress scheduled late March 1954; (c) promise of significant easing of economic occupation burdens and return of POWs by USSR; and (d) noticeable decline, although not complete disappearance, of slowdowns and work stoppages in industrial plants.

Summing up picture, we conclude that, while regime still potentially vulnerable, its position is considerably improved over July. New spontaneous uprisings, due internal SED measures, now considered unlikely. With extremes of a pre-June 9 ruthless, hard policy and an immediately post-June 17 weak, uncertain soft policy both known factors to all now, appears likely party and government, should they make appreciable progress in next few months in further improving internal security situation, could, if they desired, relax present hard political line. They could expand area of concessions, now limited to economic field, to include political and juridical sectors, without creating momentary political vacuum as in June. Such an expansion, if it took place, would reflect only shift in Communist tactics, not basic policy. This would be sufficient, however, to improve maneuverability of Communists on German unity issue.

  1. Repeated to Washington, London, Paris, and Moscow; the source text is the copy in Department of State files.