Foreign Relations of the United States: Diplomatic Papers, 1945, European Advisory Commission, Austria, Germany, Volume III

740.00119 Control (Germany)/3–1045

Memorandum by the Secretary of State to President Roosevelt ⁴³

[Washington, March 8, 1945.]

Your memorandum of February 28 directed me to assume the responsibility for carrying forward the conclusions you reached at the Crimea Conference. In pursuance thereof, I am attaching for your approval a suggested directive on the treatment of Germany which I believe conforms to the Yalta discussions and decisions. I believe that such a directive is urgently necessary to implement the Yalta decisions and continue the formulation and development of United States policy to be concerted with our Allies. If you approve of the attached directive, I suggest the establishment of an informal policy committee on Germany under the chairmanship of the Department of State and including representatives of War, Navy, Treasury and the Foreign Economic Administration. This committee would serve as the central source of policy guidance for American officials both civilian and military on questions relating to the treatment of Germany and its proceedings would be based on the attached directive.

[Annex]

Draft Directive for the Treatment of Germany

March 10, 1945.

i. military government

1. The inter-allied military government envisaged in the international agreement on control machinery for Germany shall take the place, and assume the functions, of a central government of Germany.

2. The authority of the Control Council shall be paramount throughout Germany. The zones of occupation shall be areas for the enforcement of the Council’s decisions rather than regions in which the zone commanders possess a wide latitude of autonomous power.

3. German administrative machinery must be purged as set forth below. It shall be used in so far as it can serve the purposes of this directive and does not permit Nazi abuses.

ii. immediate security measures

1. The German armed forces, including para-military organizations, shall be promptly demobilized and disbanded.

2. All military and para-military agencies, including the General Staff, partly military and quasi-military organizations, the Reserve Corps, and military academies, together with all associations serving to keep alive the military tradition in Germany shall be immediately dissolved and thereafter prohibited.

3. All German arms, ammunition and implements of war shall be removed or destroyed.

4. Military archives and military research facilities shall be confiscated.

5. The manufacture and the importation of arms, ammunition and implements of war shall be prohibited.

6. The German aircraft industry shall be dismantled and the further manufacture of aircraft and component parts shall be henceforth prohibited.

iii. immediate political measures

1. The Nazi Party and its affiliated and supervised organizations shall be dissolved and their revival in any form shall be prohibited. Such non-political social services of these organizations as are deemed desirable may be transferred to other agencies.2. Nazi laws which provided the legal basis of the Hitler regime and which established discriminations on grounds of race, creed, and political opinion shall be abolished.

3. All Nazi public institutions (such as the People’s Courts and Labor Front) which were set up as instruments of Party domination shall be abolished.

4. Active Nazis and supporters of Nazism and other individuals hostile to Allied purposes, shall be eliminated from public and quasi-public office and from positions of importance in private enterprise. Active Nazis shall be defined as those approximately two million members of the Party who have been leaders at all levels, from local to national, in the Party and its subordinate organizations.

5. Nazi political malefactors and all war criminals shall be arrested and punished.

6. Germans taken abroad for labor reparation shall be drawn primarily from the ranks of the active Nazis and of Nazi organizations, notably from the SS and the Gestapo.

This procedure will serve the double purpose of eliminating many of the worst carriers of Nazi influence from Germany and of compelling the guilty to expiate their crimes and to repair some of the damage they have done.

7. Under the direction and supervision of the Control Council there shall be established throughout Germany a unified system of control over all means of disseminating public information.

8. There shall be established a uniform system of control over German education designed completely to eliminate Nazi doctrines and to make possible the development of democratic ideas.

iv. economic control

1. Pending definite decision on revision of boundaries and partitioning, Germany as it existed on January 1, 1938, with the exception of East Prussia and Upper Silesia, shall be administered and controlled as an economic unit.

2. The economy of Germany shall be directed, controlled and administered in such a way as to

(a) Provide facilities for, and contribute to the maintenance of the occupying forces and occupying authorities.

(b) Stop the production, acquisition and development of implements of war and their specialized parts and components.

(c) Provide a minimum standard of living for the German people including such food, shelter, clothing and medical supplies as are required to prevent disorder and disease on a scale that would make the task of occupation and the collection of reparation substantially more difficult.

(d) Provide such goods and services to Allied countries for relief, restitution and reparation as will be in excess of the requirements of the occupation forces and the minimum standard of living.

(e) Conform to such measures for the reduction and control of Germany’s economic war potential as the Allied governments may prescribe. (See paragraphs 13 to 18, inclusive.)

3. It is recognized that a substantial degree of centralized financial and economic control is essential to the discharge of the tasks mentioned in paragraph 2. The Control Council shall have general responsibility for insuring that all measures necessary to this end are taken.

4. In particular, the Control Council shall be empowered to formulate, within the framework of existing and future directives, basic policies governing (a) public finance; money and credit, (b) prices and wages, (c) rationing, (d) inland transportation and maritime shipping, (e) communications, (f) internal commerce, (g) foreign commerce and international payments, (h) resititution and reparation, (i) treatment and movement of displaced persons, and (j) allocation of plant and equipment, materials, manpower and transportation.

5. It is recognized that the prevention of uncontrolled inflation is in the interest of the United Nations. The Control Council shall strive to insure that appropriate controls, both financial and direct, are maintained or revived.

6. The Control Council shall utilize centralized instrumentalities for the execution and implementation of its policies and directives to the maximum possible extent, subject to supervision and scrutiny of the occupying forces. Whenever central German agencies or administrative services which are needed for the adequate performance of such tasks have ceased to function they shall be revived or replaced as rapidly as possible.

7.

• (a) Before utilizing German agencies military government authorities must carry through denazification in accordance with the principles set forth above.
• (b) German nationals deprived of their positions because of previous affiliations with or support of the Nazi party or because of disloyalty to the military government authorities shall be replaced as far as possible by other German nationals. In recruiting replacements military government officers shall rely as much as practicable on the leaders and personnel of freely organized labor unions and professional associations and of such anti-Nazi political groupings and parties as may arise in Germany.

8. Military government shall eliminate active Nazis and supporters of the Nazi regime and other individuals hostile to Allied purposes, from dominant positions in industry, trade and finance.

9. Military government shall permit free and spontaneous organization of labor and professional employees. It shall facilitate collective bargaining between employers and employees regarding wages and working conditions subject to overall wage controls and considerations of military necessity.

10. Germany shall be required to restore all identifiable property which has been taken from invaded countries. It shall also be compelled to replace objects of unique cultural and artistic value whenever looted property falling within these categories cannot be found and restored.

11. Germany must make substantial reparation for damage to, or losses, of, non-military property caused by or incident to hostilities. Such reparation shall take the form of (a) confiscation of all German property, claims and interests abroad, (b) deliveries from existing German assets, particularly capital equipment, (c) deliveries from future German output, and (d) German labor services in devastated countries.

12. The reparation burden and schedules for delivery should be determined in such a manner that Germany can discharge its obligation within a period of ten years from the cessation of organized hostilities.

13. The volume and character of German reparation deliveries of capital equipment shall be largely determined in such a way as to reduce Germany’s relative predominance in capital goods industries of key importance and to rehabilitate, strengthen and develop such industries in other European countries, as part of a broad program of reconstruction.

14. Germany shall be prohibited from engaging in the production and development of all implements of war. All specialized facilities for the production of armaments shall be destroyed, and all laboratories, plants and testing stations specializing in research, development and testing of implements of war shall be closed and their equipment removed or destroyed.

15. Germany shall also be forbidden to produce or maintain facilities for the production of aircraft, synthetic oil, synthetic rubber and light metals. Production facilities in these industries shall be removed to other countries or destroyed.

16. In order to foster and develop metal, machinery and chemical industries in other countries, exports of competing German products shall be subjected to restraint for a considerable period. At the same time, German production and export of coal and light consumer goods shall be facilitated.

17. German firms shall be prohibited from participating in international cartels or other restrictive contracts or arrangements. Existing German participations in such cartels or arrangements shall be promptly terminated.

18. The scope and execution of the economic disarmament program should be made compatible with the payment of reparation and both the reparation and economic disarmament programs should take into consideration the necessity of maintaining a minimum German standard of living as defined in paragraph 2.

19. In fulfillment of this principle, Germany shall be made to begin paying her own way as soon as possible. There shall be no simultaneous payment of reparation by Germany and extension of credit to Germany. Payment for such imports as are authorized by the Control Council shall be made a first charge on the proceeds of German exports. If Germany is unable to export sufficient goods in excess of reparation deliveries to pay for authorized imports, reparation recipients shall be required to shoulder this deficit in proportion to their respective receipts from reparation.

43. File copy neither signed nor dated; it was returned by President Roosevelt with the marginal notation: “OK FDR.” A carbon copy is dated March 8, 1945. Another copy of this memorandum bears the handwritten, unsigned notation: “March 12, 1945 approved. Handed in person to the Secy. 3/13/45 Staff Meeting.” A covering chit by Mr. Hathaway Watson, Assistant to the Special Assistant to the Secretary of State (G. Hayden Raynor), dated March 14, attached to still another copy of the memorandum reads as follows: “Original was returned from the White House approved by Mr. Roosevelt. I personally handed it to Mr. Stettinius in the Staff Meeting.”