At your earliest convenience I would very much like to see the
[Page 754]
President with you
about this memorandum and the memorandum on Japan2 sent to you yesterday.
[Enclosure]
The Secretary of War (Stimson)
to the President3
top
secret
[Babelsberg,]
16 July
1945.
Memorandum for the
President
The matters with which I am primarily concerned, namely the
administration of Germany and the conduct of the war with Japan, are, upon
analysis, inextricably related to the general problem of
post war rehabilitation and
the achievement of the strategic aims for which we have been
fighting.
the condition of central
europe
We have occupied Germany following a devastating conquest
which has laid waste wide areas of middle Europe, extending
from France to well within the boundaries of Russia, and
extending from the North Sea and the Baltic to the
Mediterranean. Germany, which has been responsible for
loosing the forces which resulted in the two World Wars, is
herself laid waste and is in the geographical center of the
area of devastation.
This area in the main was a highly industrialized one, its
industrialization being evidenced by the number of large and
prosperous
[Page 755]
cities
within it. All who have visited Germany and the portions of
Poland and Russia overrun by the war, testify to the great destruction visited
upon those cities. Almost without exception, cities large
and small have been torn by explosives of greater power than
have been developed in any previous wars. It may be true, as
was stated before the Kilgore Committee of the Senate,4 that many of the
plants could, with industry, be restored or set in motion
with relatively little or no repair. But there is a great
difference between the mere physical existence of a plant
and its capacity to operate as a going concern. That
capacity has been destroyed, at least temporarily, by the
destruction of the means of communication to and from the
plant, and by the general collapse following defeat. A
paralysis of commerce has set in due to the lack of
transportation, raw materials, and the means of trade. This
paralysis is not limited to Germany, but may grip all
western Europe as well.
As occupiers of portions of this area, we shall have many
serious administrative problems to cope with, problems which
will be greatly accentuated by lack of food and fuel. For
this reason alone it should be our policy to make it
possible for the people we control to work, and thus relieve
us to the maximum possible extent of the burden of their
idleness and want. I take it that all our objectives are
included in one fundamental purpose—the achievement of
security and peace under conditions which preserve to us our
concepts of liberty. While it is our object to disarm
Germany, it should not be our purpose to make it impossible
for the German people to live and work. We should not remove
their capacity for aiding in the restoration of stable
conditions in Europe and the world.
On the one hand it is clear that Germany has created, and
twice misused, a swollen war
industry—one substantially beyond her peaceful needs, and
even though this capacity has been greatly impaired by
defeat, certain physical steps can and should be taken to
hamper the regrowth of her industrial capacity to more than
reasonable peacetime needs.
On the other hand from the point of view of general European
recovery it seems even more important that the area again be
made useful and productive. Considering Germany alone, the
figures show that the commerce of Europe was very largely
predicated upon
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her industry. There was a period, substantially before the
war, when Germany became
the largest source of supply to ten European countries—viz.
Russia, Norway, Sweden, Denmark, Holland, Switzerland,
Italy, Austria-Hungary, Roumania and Bulgaria, and the
second largest supplier of Great Britain, Belgium and
France. At the same time she became the best customer of
Russia, Norway, Holland, Belgium, Switzerland, Italy, and
Austria-Hungary, and the second best of Great Britain,
Sweden and Denmark.
Germany, according to estimates we now have, will continue to
have about the same number of people she had before the
war, and they will have
to be fed, clothed, and housed in some manner. Of her
approximately 70,000,000 people (including Austria), about
25,000,000 have been supported by industrial rather than
agricultural activity. England and France, at the moment, do
not have sufficient production to take care of their own
needs by a long measure. There will be a scarcity of
products which will plague all Europe for a substantial
period to come, and the effects of it are bound to be felt
by the other countries of the world.
The problem which presents itself therefore is how to render
Germany harmless as a potential aggressor, and at the same
time enable her to play her part in the necessary
rehabilitation of Europe.
the impracticability of
destroying german industry
It is my view that it would be foolish, dangerous and
provocative of future wars to adopt a program calling for
the major destruction of Germany’s industry and resources.
Not only would any reasonable prospect for the
reestablishment of European industry be dissipated by such
action, but such destruction would be bound to leave a focus
of economic and political infection which might well destroy
all hope we have of encouraging democratic thinking and
practices in Europe. What elements of German industry can be
destroyed or removed as unnecessary for peacetime needs is a
matter of [for?] expert
determination. The balance must be put to work as soon as
practicable and subjected to some system of security
control. It is a task requiring perseverance, application
and intelligence over a long period of time, but I am
certain that mere destruction is neither effective as a
security measure, nor, in the light of European, including
German needs, possible as an economic one.
The need of all Europe includes the prompt stimulation of
production within Germany, of food, coal, clothing, and
housing. Production of these items is not capable of
independent development. It must be based on other items and
services, in short, general industry and trade. Without
freedom of internal trade and communication, no one of these
items can be produced on the scale which
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will be required. It follows
that we cannot afford to operate Germany as if she were four
separate water tight compartments.
recommendations
Accordingly, as a first step, I would urge the adoption by
the Great Powers at the Conference of a policy which would
treat Germany as an economic unit so as to permit her to
contribute to her own and to general European
rehabilitation. To this end I would urge that the three
Powers instruct their representatives in the Control Council
to adopt a uniform policy in respect to such matters of
nation-wide importance as transportation and communication,
rationing and control of critical prices. I would urge that
the Control Council also be instructed to adopt a uniform
currency and a uniform fiscal and taxation system. They
should also be instructed to decree a free exchange of
commodities and persons, (subject to feeding and housing
limitations) between the zones, and the full recognition of
the principle that the cost of any imports shall be a first
charge against any exports. And at the same time, in order
to accomplish the future security, I would urge that the
Control Council be instructed to:
- (a)
- Institute a system of control over imports and
exports which will eliminate the importation of any
article not clearly needed for peacetime necessities
and commerce.
- (b)
- Decentralize the political authority of the
Germans, giving encouragement to the local
administrative units, and by the popular selection
of local administrators through free but Nazi-purged
elections. For the time being there should be no
central political government of Germany other than
the Control Council itself acting through such
German administrators as it cares to select.
- (c)
- Completely abolish the German General Staff and
submit a plan whereby the world may be assured that
neither it, nor anything like it, will again become
a factor in the government of Germany.
- (d)
- Determine and report the extent to which German
industrial activity may safely be resumed,
considering (1) rehabilitation needs, and (2) the
necessity of reducing Germany’s overdeveloped war making powers.
The above are not all-inclusive, but I believe they are
essential and would constitute a good common start toward
achieving the economic and strategic objectives which we
seek. I assume of course, that the process of punishment of
war criminals will, in
coordination with the Control Council[,] be prosecuted
vigorously.5
. . . . . . . . . . . . . .
