Foreign Relations of the United States, 1955–1957, Central and Southeastern Europe, Volume XXVI

182. Report Prepared by the Operations Coordinating Board¹

Washington, December 5, 1956.

PROGRESS REPORT ON “UNITED STATES POLICY TOWARD BERLIN” (NSC 5404/1)²

(Policy Approved by the President, January 25, 1954)

(Period Covered: May 18, 1956 through December 5, 1956)

A. Summary of Operating Progress in Relation to Major NSC Objectives³

1. OCB Recommendation Regarding Policy Review. U.S. policy toward Berlin as set forth in NSC 5404/1 has been reviewed from the standpoint of operating considerations and in the light of operating experience to date and of anticipated future developments. No review of policy is recommended. No modifications are required in NSC 5404/ 1 as a result of approval of 5602/1.⁴

2. Summary Evaluations. The Western position in Berlin has been maintained and consolidated. Current Soviet policy has resulted until recently in a period of relative relief from Communist harassments (see Sec. C, para. 9). An evaluation of actions taken in the implementation of U.S. policy follows:

a. Making Clear the Western Position. We have continued to react vigorously to local Communist-inspired incidents and to make clear that the Western powers will maintain their position in Berlin.

b. Bolstering the Morale and Economy. Economic assistance from the United States and the Federal Republic has finally succeeded in raising industrial production in Berlin to the 1936 level (1936—100; West Germany, June 1956—210; Berlin, June 1956—100). Unemployment has been reduced below 100,000. Both these developments represent significant progress over the situation of two to three years ago. However, West Berlin continues to rely heavily on outside assistance to maintain itself. While the general improvement in economic conditions continues to provide sharp contrast to conditions in the surrounding Soviet Zone, general living standards and the level of employment lag behind those in Western Germany and the Berliner is acutely aware of his comparatively depressed economic condition. He realizes also his city’s vulnerability to Communist pressure and the extent to which improvement of his lot depends on outside economic and political support.

c. Continuing Special Soviet Zone Projects. Berlin continues to be a focal point for special projects designed to influence the people of the Soviet Zone and Sector. (See East Germany Progress Report.)⁵

d. Maintaining Access to Berlin. Progress on tripartite military planning regarding action to be taken in the event of serious interference with access to Berlin has been negligible. The British and French have thus far agreed only that the Allied Embassies should instruct their respective Army Commanders to prepare a study on the “military implications” of the problem and to report back to the Embassies before planning is begun. The Military Commanders expect to complete their study and report to the Embassies in the near future.

e. Maintaining Stockpile and Airlift Planning. Quadripartite work on practical steps to carry out the previously agreed airlift plan has continued. The three Allied Embassies expressed their Government’s concurrence in the plan in replies to the German notes of March 14⁶ which transmitted German acceptance of the plan. Quadripartite stockpile experts have supervised the replacement of coal and coke which were withdrawn from the stockpile during last winter.

f. Planning Countermeasures to Harassments. Progress toward planning for effective countermeasures against possible Communist harassment of Berlin has been hampered by the negative reaction of the German authorities toward the preliminary studies which have been planned to provide an assessment of East Germany’s vulnerability.

3. Progress in Meeting Program Schedules. Obligation of the local currency proceeds of U.S. aid for such Berlin programs as reconstruction, the Berlin Convention Hall, medium and long-term loan programs, continued satisfactorily.

B. Major Operating Problems or Difficulties Facing the U.S.

4. Vulnerability to Harassment Continues. East German threats to assert its “sovereignty” over Berlin’s exposed communication lines with the West in an attempt to force recognition of East Germany by the Federal Republic did not materialize in the form earlier feared. However, Berlin remains vulnerable to either sudden or gradual harassment of its lines of communication. There is some reason to believe that East Germany is being restrained from the steps it wishes to take by a Soviet desire to conciliate Western opinion and avoid incidents for which they would be blamed. Should the Soviets change this posture or decide that they can dissociate themselves from East German moves, it is probable that East Germany will use its powers over access to Berlin to seek to raise the level of its technical contacts with Federal Republic officials and thus obtain a measure of recognition by the Federal Republic.

5. Cooperation Lagging on Planning Countermeasures. Despite the absence of harassment and the recession of threats thereof, the problem of planning for economic countermeasures in the event of measures interfering with Western access to Berlin remains, in principle, as important as ever. Unless the German attitude toward the preliminary statistical study changes, however, progress is unlikely.

6. Need for Continued Aid for Berlin. Despite Berlin’s economic progress over its previous situation, the city continues to be hampered by its geographic and psychological disadvantages and must rely on outside assistance to maintain even its present level of activity. In order to attempt to continue the present rate of improvement, the Federal Republic will contribute to the city’s budget deficit, and private and public investment will receive assistance from counterpart of U.S. aid yet unspent or to accrue from principal and interest payments on old loans. Although the need for aid for strictly economic purposes is diminished there is a continuing need for visible and current demonstrations of continuing U.S. concern for the problems of the city and for the welfare of its people. Therefore modest amounts of new dollar funds will be required to underwrite selected projects with maximum impact to underline the continuing nature of U.S. support of West Berlin.

7. Planning Incomplete for Research Reactor. The Berlin city government in July placed an order for an atomic research reactor with an American firm. A proposal for United States operation of a reactor in Berlin, with costs to be defrayed by the Germans, is in an advanced stage of consideration by the State Department and the Atomic Energy Commission.

C. Listing of Other Major Developments During the Period

8. Internal Political Developments. The three-month illness of governing Mayor Suhr threatened to create troublesome internal political problems. Deputy Mayor Amrehn, of the CDU (Christian Democratic Party), who was the acting executive head of the city government most of the summer, proved able and effective, but as he is a member of the minority party in the SPD–CDU (Social Democratic Party–Christian Democratic Party) coalition, his success was resented by the SPD. This divided responsibility has led to some confusion and uncertainty, and the question of selecting a successor to Suhr if his health does not improve will be a source of increasing pre-occupation for the Berliners.

9. Traffic Between Berlin and the West. Despite the concern which arose after the September 20, 1955 agreements between the USSR and East Germany, East Germany has not increased its interference with German transport and traffic to Berlin or Allied access to the city. Road tolls continued to be imposed by the East German regime, but traffic of all types, including barge traffic, moved normally. On the other hand, during the past two weeks Allied military trains to and from Berlin have encountered administrative difficulties and delays occasioned by new Soviet procedures in checking the documents of travelers on the trains. However, no United States train has been prevented from completing its journey and in many cases there has been no interference with the regular train schedule. An Allied protest has been lodged with the Soviet military authorities against the interferences which have taken place. No clear pattern of Soviet intentions in this matter has as yet emerged.

10. Personal Travel. Within the city of Greater Berlin, the Communists have somewhat relaxed controls between the east and west sectors. There appears to be no imminent danger, as was feared earlier, of Communist action physically to seal off West Berlin from East Berlin.

11. Berlin Congress Hall. Good progress was made on the construction of the Berlin Congress Hall for the International Building Exposition in 1957. The foundation has been laid and the contracts for the superstructure have been let, and completion is scheduled for the autumn of 1957. Deputy Under Secretary Murphy represented the United States at the cornerstone laying ceremony on October 3 and delivered two addresses while in Berlin.

12. Berlin Industrial Fair. The U.S. participated successfully in the Berlin Industrial Fair with a major exhibit on “Space Unlimited”. The U.S. exhibit was open to the public for an additional two weeks during October in response to many requests.

13. Regulation of Military Use Goods. The three Allies have simplified regulations applicable to the production of goods which are capable of being diverted to military as well as civilian uses. However, both German and Allied authorities recognize the undesirability of appearing to convert Berlin into an arsenal and production of items for military use will continue to be prohibited.

14. Surplus Commodity Sales. The U.S. reached agreement in May 1956 to program Deutschemarks 42 million ($10 million) of proceeds from the sale of surplus agricultural commodities for the Berlin reconstruction program.

1. Source: Department of State, OCB Files: Lot 62 D 430, Germany. Secret. Regarding the preparation of this report, see footnote 1, Document 84. An attached Financial Annex is not printed.
2. See Foreign Relations,, 1952–1954, vol. VII, Part 2, p. 1390.
3. The latest NIE is 11–3–56, dated February 28, 1956. [Footnote in the source text. NIE 11–3–56 is Document 178.]
4. For text of NSC 5602/1, “Basic National Security Policy,” March 15, 1956, see vol. XIX, pp. 242–268.
5. Document 231.
6. Not found in Department of State files.