Exorcising Hitler

by Frederick Taylor

  In the final analysis, like the Western powers they criticised so savagely – and sometimes rightly – the communists were prepared to cut deals and compromise. By the late 1940s, Germany was no longer just a defeated nation to be disposed of as the victors willed, but the cockpit of the Cold War.

  * Exact value equivalents are difficult to estimate. The French franc had been steadily sliding in value since 1936 and would continue to do so until the ‘new Franc’ was introduced in 1960 and its worth stabilised. The exchange rate was around 120 to the American dollar in 1945 and by 1949 had slid to some 350 to the dollar. Choosing a mean value of around 250 to the dollar, this sum might represent $200 million, i.e. some $2–3 billion at current prices.

  13

  Hope

  In May 1946, General Clay cabled Chief of Staff Eisenhower a memorandum, in which he attempted to sum up the situation of Germany one year after Victory in Europe. It was a far from optimistic communication. Clay wrote:

  After one year of occupation, zones represent airtight territories with almost no free exchange of commodities, persons and ideas. Germany now consists of four small economic units which can deal with each other only through treaties in spite of the fact that no one unit can be regarded as self-supporting, although British and Russian zones could become self-supporting. Economic unity can be obtained only through free trade in Germany and a common policy for foreign trade designed to serve Germany as a whole. A common financial policy is equally essential. Runaway inflation accompanied by economic paralysis may develop at any moment. Drastic fiscal forms to reduce currency and monetary claims and to deal with debt structure are essential at earliest possible date. These cannot be obtained by independent action of the several zones. Common policies and nationwide implementation are equally essential for transportation, communications, food and agriculture, industry and foreign trade, if economic recovery is to be made possible.1

  In practice, he said, the only possibility of economic integration was with the British Zone. ‘In theory’ the Russians should find it acceptable ‘though in detail many difficulties will arise with the Russian representatives’. The proposals would be unacceptable to the French, who were still insisting that the Rhineland and the Ruhr be detached from Germany, a suggestion Clay dismissed without reservation. It posed the prospect not just of a German crisis but of ‘a world disaster’. Clay’s cable makes it clear that, in reality, the French were seen as more of a problem than the Russians. The Russians might be obstructive on detail, but not at this point on basic principle. The French, however, refused point-blank to accept either a unified administration in Germany or a unified economy. It could be argued with hindsight that the Soviets let the French do a lot of their ‘dirty work’ for them, but that was not apparent to contemporaries.

  Clay continued:

  However, if agreement cannot be obtained along these broad lines [i.e. general integration of all four zones], we face a deteriorating German economy which will create political unrest favourable to the development of communism in Germany and a deterrent to its democratisation. The next winter will be critical under any circumstances and a failure to obtain economic unity before the next winter sets in will make it almost unbearable.

  The General from South Carolina was clearly in favour of a merger with the British Zone before the next winter was upon Germany, however many problems it caused with the Russians and the French. He and his masters in Washington had not yet fully given up on the hope that Germany could be run as a whole, but there were so many complications and disagreements that optimism in this regard was becoming harder to sustain.

  In Washington things were also moving in a new direction, away from four-power to unilateral action, or at best joint action with the British. At Paris in April, when the four powers’ foreign ministers (plus China) met yet again to try to agree on a unified approach to fulfilling the detailed provisions of the Potsdam Agreement, the result remained one of stalemate. The US Secretary of State, James F. Byrnes, held out against new reparations demands from the USSR, telling Stalin’s Foreign Minister, Molotov, that the US and Britain were having to pay half a billion dollars a year to feed ‘their’ Germans because the Russians were refusing to supply them with food. Molotov also rejected Byrnes’ suggestion that Germany be demilitarised and remain that way for twenty-five years. With America still due to withdraw its troops from Europe within the next couple of years, the most likely conclusion to draw from that was that the Soviets were simply waiting for them to leave before they made their real move on Germany.

  Whether this suspicion of aggressive Soviet intentions was justified is uncertain. Stalin’s exhausted but triumphant country continued to tighten its grip on Eastern Europe as well as on its own zone in Germany, and to look for advantage in an opportunistic fashion, either directly or through political proxies. The question was not if Stalin would have liked to have seen a united, communist Germany, but if he was prepared to use force rather than persuasion and subterfuge to get it.

  By the beginning of 1946, there were plenty of indications that Stalin was not going to cooperate with the Anglo-Americans, however, and not just with regard to Germany. Russia was refusing, for instance, to carry out its part of the post-war agreement when it came to Iran. The country had been occupied by British, American and Russian troops during the war years, with an agreement that all would withdraw as soon as peace came. The British and American forces duly complied within the time agreed, but the Soviets did not, and, moreover, showed signs of trying to expand their area of occupation. Two ethnically based ‘soviet republics’ were set up by Soviet agents on Iranian territory during early 1946. These were liquidated by the Iranian army, with American encouragement, and their leaders either executed or put to flight, but the crisis atmosphere lingered on for months before Stalin quietly withdrew. The Iran crisis was a key factor in the deteriorating relationship between the Anglo-American axis and its former Soviet allies. While it was still simmering, President Truman reinforced his case by sending the US battleship Missouri to the Mediterranean. The Missouri came to form the core of the Sixth Fleet, which is still there.2

  At around the same time, the Soviet Union abruptly withdrew from the discussions at Bretton Woods about future international financial stability, which led to the foundation of the International Monetary Fund and the World Bank.3

  On 9 February 1946 Stalin made a speech in Moscow in which he began to retreat from the grand alliance with the capitalists that had won the war, and by the same token from any economic arrangements that would leave capitalism intact. It was a traditional Marxist-Leninist rant in which he repeated Lenin’s claim that capitalism always brought war, and that, even though the Nazis had been beaten, peace would come only when communism triumphed throughout the world. He reminded his audience of the pre-war industrialisation of the Soviet Union – achieved, of course, at appalling social and human cost – and how this had enabled Russia to win the war with Germany (Stalin made no mention of the Anglo-American aid that had also made a great, perhaps decisive difference to the Soviet war effort). And he called for preparations for the new struggle that, given the contradictions of capitalism, would surely be necessary in the future.4

  It was at this time, February 1946, that America’s deputy chief of mission in Moscow, George Kennan, sent a cable to the US Department of the Treasury, which had requested some insight into the Soviet thinking that had caused the Russians to pull out of Bretton Woods. The cable, a remarkable 5,500 words long, went far beyond financial matters and into the politico-military problems exemplified in situations such as the Iran crisis and the increasing tension in Germany. It ended up exploring what Kennan saw as the entire, complex psychopathology of Soviet/Russian behaviour, and making suggestions as to how America should handle the deteriorating relationship with its erstwhile wartime ally and ‘contain’ the Russian power that now extended over half Europe and into Asia, too. Kennan’s influential cable became known as ‘The Long Telegram’. It
would play a crucial role in post-war American policy.

  Even months before the German surrender, Kennan had favoured not trying to run post-war Europe in concert with the Russians but dividing the continent into spheres of influence, so that ‘. . . within whatever sphere of action was left to us we could at least . . . [try] to restore life, in the wake of the war, on a dignified and stable foundation’.5 Just over a year later, he wrote of ‘containing’ the Soviet Union, whose view of world affairs was ‘neurotic’. He proposed a more forward stance than the simple drawing of lines and demarcation of spheres. To do this, the counter-forces – cultural, economic, political – had to be consciously strengthened and promoted. In the penultimate paragraph of his telegram he wrote:

  It is not enough to urge people to develop political processes similar to our own. Many foreign peoples, in Europe at least, are tired and frightened by experiences of the past, and are less interested in abstract freedom than in security. They are seeking guidance rather than responsibilities. We should be better able than the Russians to give them this. And unless we do, the Russians certainly will.6

  Of the ‘foreign peoples’ Kennan referred to, few fitted his bill in terms of their anxieties and hopes more closely than the Germans. They needed encouragement and hope, and for its part America needed to realise that, in dealing with the fifty million people who were now crowded into the Western zones of Germany, it had to offer them more than just moralistic finger-wagging, war crimes trials, heatless winters and the ‘soup kitchens’ Roosevelt had thought sufficient back in late 1944. Germany – because of its position, its people, its industrial capacity – was the key to Europe.

  A little more than two weeks later, on 5 March, in Fulton, Missouri, Winston Churchill delivered a speech in which he called for Britain and the USA to unite against possible Soviet aggression. He referred to an ‘iron curtain’ stretching from Stettin on the Baltic to Trieste in the Adriatic, behind which the resubjugation of the recently liberated peoples of Eastern and Central Europe was being accomplished with consummate ruthlessness by Stalin’s henchmen. Churchill’s electoral defeat the previous July had relegated him to the post of Leader of the Opposition in Britain, but as a statesman his words held vast authority and served as another indication of the shift in Western attitudes. The speech was actually received downright sceptically by many Americans, who were not looking for more foreign entanglements at this point, but his words hung in the air, and they were closely listened to in Europe.7

  There was a problem implicit in this new forward stance being proposed by Kennan. The thoughtful diplomat did not dwell on military factors, but they were a significant part of the equation. Officially, America was still committed to withdrawing all its troops from Europe, and soon. At the end of the war there had been ninety-seven American divisions on active duty in all theatres. That number had already been reduced by some eighty divisions, and demobilisation was continuing. The British Army’s strength would fall from five and a half million to a little over a million in the same period. The French continued to expand their post-war army, but they would soon be distracted by adventures in the Middle East and Indo-China. In any case, feeling in much of France was pro-Soviet. The coalition government in Paris, which included communist ministers until May 1947, frequently cooperated with Moscow to present an obstructionist united front in German affairs.

  The Soviets, actually, had also gone a long way towards demobilising their own huge army, which by the end of 1947 would be reduced from a wartime strength of more than eleven million to one of just under three million – in absolute terms, of course, still greatly outnumbering the military manpower of the other three victor nations. As Churchill said in his speech in Fulton, Missouri, the Russians might not want war, but they did want ‘the fruits of war and indefinite expansion of their power and doctrines’. Whether or not Stalin was preparing to use this still-formidable force, and from what we know now this seems unlikely, it remained a highly visible and threatening phenomenon.8

  In October 1945, only 7 per cent of the American electorate thought that foreign policy concerns should take precedence over domestic problems.9 The discussions that were going on within the inner circles of the State and Defence Departments during early 1946 would probably have horrified the average American voter, but that did not make them any less necessary. So long as the Americans continued to plan their withdrawal from Europe, their policy towards the Soviets was shaped by the necessity of establishing some kind of modus vivendi with Stalin that would offer a measure of security for Western Europe against possible Russian aggression. This necessity placed Moscow in an altogether advantageous position, and weakened the American stance.

  Clay knew this. He also knew that somehow the French and the Russians had to be stood up to. On 19 July he put together a long letter to his Civil Affairs Director, General Echols, which he intended using as the basis for a speech that would be distributed throughout the occupation administration as well as to the German public.10 Clay, it is clear from some of his letters at this time, was feeling frustrated and even depressed by his inability to make the progress in Germany that he felt lay within his and America’s grasp.11 He was even considering early retirement.

  The need for this statement arose from a speech by Soviet Foreign Minister Molotov in Paris the week before, one day before the Allied foreign ministers’ conference there broke up in some confusion on 12 July. Molotov said that the creation of a united independent Germany had become urgent, complete with a (highly centralised) democratic central government and a full programme of economic reconstruction. To this end, for the first time, the Soviet Foreign Minister surprised everyone by stating clearly that the Ruhr should not be separated from Germany, thus leaving the French isolated in their demand for detachment and internationalisation of the Reich’s richest and most productive industrial area.

  Molotov also, however, refused Secretary of State Byrnes’ suggestion that, as a first step, zonal boundaries be dismantled and intra-German free trade finally introduced. And, in the metaphorical small print, the Russian demanded that reparations from Germany be increased to ten billion dollars and also be supplied in part not just, as hitherto, from dismantling and confiscation but from current German production. Molotov’s declaration was, in truth, a mixed message of a typically Soviet sort – a seemingly generous offer that was liable to vanish in a fog of Russian bureaucratic obstruction, procedural attrition and semantic nit-picking once it came to actually putting the thing into practice.

  The problem for the Americans was that, for all its ambiguities, Molotov’s statement seemed to play well with the German press, West as well as East. It seemed more decisive, and therefore potentially more attractive to the German population, than anything the divided Western Allies had to offer. ‘While occupied Germany is busily discussing the Molotov statement,’ Clay wrote in the preamble to his letter, ‘our own military government people have no real up-to-date summarized version of our policy or objectives which they could use in discussions with our German people.’

  In the draft of his summary, Clay made it clear, while paying lip service to Potsdam and JCS 1067, that Germany was not to be squeezed if that meant its people starved. And he included an interesting aside: ‘The United States recognizes the need for the occupation of Germany until Allied objectives have been accomplished. It believes that with the return of responsibility to the Germans, the size of the occupation forces can be reduced soon thereafter . . .’ The implication was of a longer-term American military presence of some size in Germany. A united, democratic and self-governing Germany was reckoned, even under more favourable conditions than those currently pertaining, to be years away.

  On Clay’s instructions, the letter was copied to the Defence and State Departments. At the latter, the Assistant Secretary, Howard C. Peterson, commented, ‘My only criticism of Clay’s proposed statement is that it tends a bit in tone towards wooing the Germans.’12 When it was discussed at the highest level,
however, it was decided that the proposed material was too political, that this kind of thing was international policy – in other words, the Secretary of State’s job.

  Clay got no reply for some time. On 7 August he wrote to the Civil Affairs Division at the War Department in Washington to protest about this, but again no instructions seemed forthcoming, even though, Clay said, this was merely a ‘statement of policy we are operating now’.13 On 12 August, the War Department ordered Clay not to publish his 29 July statement and said it would send a delegation to Berlin to discuss things. Clay complained bitterly, but there was little he could do.

  Except that the General’s opinions had not gone unheeded. ‘Wooing the Germans’ was, in fact, coming gradually into fashion, even in faraway Washington.

  On 6 September 1946, what had once been Hitler’s personal train made a stately arrival at the still bomb-shattered main station in the south-west German metropolis of Stuttgart. Aboard was James F. Byrnes, US Secretary of State. He had slept in the Führer’s bed during his overnight trip from Paris. There he had spent the past few days at peace conference proceedings that had already lasted since 29 July and would continue until 15 October, leading eventually to comprehensive treaties with former German wartime allies such as Italy, Hungary, Bulgaria, Romania and Finland.

  Byrnes’ last public appointment in Paris had been a discussion with the Hungarian Prime Minister, Ferenc Nagy,* about the internal situation there and the progress being made towards post-war rehabilitation. Now, after his nearly 700-kilometre train journey, Byrnes stepped into an official car outside Stuttgart station. Preceded by an escort of ‘screeching US army jeeps’, as Time magazine’s man had it, he rode 600 metres or so to the city’s Staatstheater, the only major opera house in Germany still functioning after five years of Allied bombing. Here an audience was waiting for him, consisting not just of American officers and diplomats but of invited German officials and civilians, plus a wide range of the international press, including Russian journalists. Significantly, the speech was also to be broadcast on German radio, with a simultaneous translation.14