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FOR THF ASSISTANT DIRECTOR FOP REPORTS AND ESTIMES
THE SOVIET POSITION IN APPROACHING THE CFM
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THE SOVIET POSITION IN APPROACHING THE CFM SUMMARY
A combination ol unfavorable developments in the West and in the Soviet orbit has apparently led the USSR to seek to regain its maneuverability In Europe bythe whole German problem ba the CFM even though the price for so doing was the ehhunatlon of thc Berlin blockade and the abandonment of the positions that had caused the breakdown of the Moscow negotiations last fall
Soviet objectives In the CFM will probably be to counteract, In some measure, the following developments which adversely affect the position of the USSR:
and Western European rearmament.
establishmentest German state, tied In with the Westernoccupied Indefinitely by thc armed forces of the Western Powers.
economic pinch in Eastern Europe, resulting from the restrictionsbetween Fast and West, which is hindering the political consolidation anddevelopment of the Satellites and the economic developments of the USSR itself.
steadily Increasing antagonism of the Germans toward thc USSR.
two basic alternative approaches open to the USSR in countering thesedevelopments appear to be:
approach which is limited to freeing the USSR from the adversethe Berlin blockade and regaining maneuverabilityontinuation of tbeand
approach which aims to reach agreement on GermanyetenteEurope.
USSR must now recognize that it cannot hope to prevent thc formation ofGerman state. Impede US and Western European rearmament or eliminateon trade between East and West (other than those resulting fromblockade) unless It is prepared substantially to meet the terms oferman settlement and to relieve the existing state of tensionand West.
it remains possible that the USSR may have in mind only theof Alternative I, the factors outlined above suggest strongly that itto follow Alternative TL
ecision to follow Alternative II wouldhilt in pciicy bul not In ultimate Soviet objectives In Germany and Western Europe. It would reflect athat (a) the opportunity to exploit the postwar 'Tevolutlonary situation" and to set up Communist-dominated governments In Western Europe and Germany had
passed and (b) the USSR must nowong-term approach to its German and
"ow. Tne lnietlieence oreanlzaUoa* of the Departmenu ot the Army. Navy, and the Air Forte have concurred In this report:issent of the Inteiltcrnee OrranUaiton. Department ol Stale, see Enclosure. 9. Tbe information contained herein l* aa ot IS Hay IMS'.
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European objectives byemporarily neutralised Germany which It would attempt to subvert by other methods.
ould not present the Western Powers with any serious policyIt would mean the continuation of past Soviet policies in Germany and Western Europe and the maintenance of the status quo except for Berlin. ThePowers have already agreed on measures to deal with this situation. Undern, however, the Western Powers would face an entirely new situation, requiring important policy adjustments. These would center about two major problems:
united Germany which,ime, would be under the supervision ofcontrol organ (Including thc USSR) and which would beositionto play off East against West In an endeavor itself to fill the powercentral Europe; and
effects of the new situation upon those aspects of the present policiesWestern Powers which are designed to strengthen to the murimumtheir military position and correspondingly to restrict the Soviet war potential.
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the soviet position in approaching the cfm
1. The Contkxt of tbe Soviet Proposal.
Since the breakdown last fail of. the Moscow negotiations to lift the Berlina stalemate has existed between the USSR and the Western Powers in Europe. The USSR had apparently anticipated that the blockade would make the position of the Western Powers in Berlin untenable and force them to reopen negotiationshole under conditions favorable to the USSR. Thc success of the air-lift defeated this objective. The USSR thus found itself committed to an unsuccessful policy. In the meantime, the developments in the West have pointed clearly to Increasing consolidation against the USSR, to the prospect of growing Westernstrength, and to the firm integrationest German state into the Western orbit with the armed forces of the Western Powers indefinitely in occupation. The USSR was thus faced with the prospectestern Germany would, for anperiod,ase for US troops andontinuation of the existing state of tension would make certain the rearmament of the US and Western Europe.
On the Soviet side, the blockade has Increased the anti-Soviet sentiment of the Germans and temporarily, at least, strengthened their attachment to thc Western camp. Efforts to effect the political consolidation and economic development of east Germany and the Satellites have been running into increasing difficulties. Theof these difficulties from the Soviet point of view cannot be precisely assessed, but it is evident that they have been of consequence and that the Western counter-measures to the Berlin blockade have aggravated the problem considerably. At the same time opportunities for the extension of Soviet Influence in the Far East have opened up at an unexpectedly rapid rate, The combination of developments in the East and the West, therefore, has apparently led the USSR to try to regain maneuverability in Europe by reopening the whole German problem In the CFM, even though the price for so doing was the eUrtuhation of the blockade and the abandonment of the positions that had caused the breakdown of thc previous Moscow negotiations.
It seems clear also that thc elaborate Soviet peace offensive has been designed, in part at least,reparationace-saving device for the abandonment of the blockade. Both to the people of the Soviet area and the outside world, the Sovietis being portrayed as proof of the peaceful intentions of the Soviet Union and, asogical and normal move for the USSR to make. It is the Western Powers that are presented as being forced by world opinion to abandon their warmongering tactics and to agree to the reopening of discussions. To the Germans, furthermore, the move is portrayedead fromecent broadcasterman observer at the Moscow May Day parade said, "Conscious of being strong enough to dispense with matters of prestige, the Soviet Government hasirst step toward resolving the Berlin and German tension."
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2. Basic Soviet AiTXJtNATivr AmoAcara.
While it is clear that the USSR has been willing to modify its conditions for lifting the blockade and risk some loss ol prestige in order to reopen four-power discussions. Its aims and objectives in the forthcoming meeting of the CFM cannot yet be precisely defined. The alternative approaches, however, appear in fairly clear relief, and It should be possible to narrow them down as the negotiations proceed. The two basicapproacheshat the USSR is rcor^ning the CFM discussions solely to free itself from the adverse effects of the Berlin counter-blockade and to regainontinuing cold war.hat the USSR is definitely seeking anou Germanyetente ln Western Europe, and is prepared to make thcconcessions to thc known western positions in order to obtain them.
Before making an estimate as to which of these alternatives thc USSR Is more likely to follow, it will be useful to examine the present Soviet position in the light of the assumed Soviet objectiveommunist-controlled Europe and Germany. It must now be clear to thc USSR that there Is no present prospect of the Communists taking control in any of the countries west of the Iron Curtain. It must also be clear to the Kremlin by now that there is no immediate prospect of the Communists getting control of Western Germany, and that, hi fact, the "hard" Soviet policy has been driving the Western Germans more firmly into the Western camp. The Kremlin mustrecognize by now that lis recent policy has helped the military, political, andconsolidation In the West which, to the extent that Western military strength increases, cannot but be regardedotential threat to Soviet security.
On the Soviet side of the Curtain, the economic barrier between East and West is disrupting the economic plans of the Satellites, creating discontent among even their Communist leaders and slowing the Satellite integration into the Soviet orbit. Tbe USSR must recognize, therefore, that Its efforts to exploit the postwar confusion by the "cold war" methods have failed and that the Western Powers cannot be Induced toettlementnited Germany that will facilitate an assumption of control by German Communists.
Soviet objectives, therefore, in reconvening the CFM would seem to be toin some measure at least, the following developments which adversely affect the position of the USSR:
US and Western European rearmament.
The establishmentest German state, tied in with the Western Powers and occupied indefinitely by the armed forces ol thc Western Powers.
The economic pinch ln Eastern Europe, resulting from restrictions on trade between East and West, wluch is hindering the political consolidation anddevelopment of the satellites and the economic development of the USSR itself.
The steadily increasing antagonism of the Germans toward thc USSR
It cannot be determined at the moment how far the USSR may be planning to go in trying to counteract these unfavorablp developments The two alternatives noted
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above may be acceptedeasure ol Soviet Intentions in this respect. The gains lo be cxpucted by thc USSR under the two alternatives may be analyzed as follows:
Alternative I
If the USSR is reconvening the CFM merely to free Itself from the economic and political disadvantages of the Berlin blockade and to regain maneuverability for aof the cold war, it may hope to obtain the following benefits:
(n) The elimination of the adverse effects of the western counter-blockade upon east Germany and theea.
improvement in the Soviet positionis the Germans through
The elimination of the blockade itself.
Posing ad the championnited Germany byermanalong the lines of the Warsaw communique.'
A chance to influence the US Congress to defeat or reduce the military aidfor Western Europe and reduce the domestic armed forces budget by initiallyonciliatory attitude and protracting negotiations as long as possible.
An opportunity to embarrass the Western Powers, particularlyis the Germansorld opinion saturated with the Soviet peace offensive, by making various insincere proposals, by offering specious compromises on the Warsaw program, and by placing upon the Western Powers the onus for the final breakdown In negotiations.
If the USSR follows this program, the discussions will again arrive at an impasse, and the conference will break up without an agreementnited Germany. If the USSR then reverts to its hard policy of the -cold war" and maintains the state of tension, lt will have gained little. It may have somewhat improved its position with the Germans. The adverse effects of the blockade will have been earned, and the USSR will seek to persuade the west Germans that the only hopenified Germany lies in coming to an understanding with an east German state. This campaign might also encourage negotiations between the Sot let zone Germans and some elements in the Western state, but In effect, this entire program would be no moreepetition of Soviet tactics that have already proved unsuccessful. The only concrete gains for the USSR would be thc lifting of the Western counter-blockade measures that would relieve somewhat the economic difficulties of the Eastern Zone, and possibly aeffect rn the US congressional support for the MAP. The USSR would have made no progress In detaching Western Germany from the orbit of Western Europe, in reducing or eUminatlng the occupation forces of the Western Powers, in stopping
Ononference ot the KomiIm Ministers ol the USSR and the itatomte states held at Warsaw.eclaration callingerman settlement It advocated theby the Four Powersocraiic. peace-loving government for the whole of Germany, composed of. Uie represenUli.es of the democratic parries and oreanlaauons ofin* conclusioneace treaty with Oeimany that would permit tbe withdrawal of all occupation troopsear afw us conclusion; four-power controlefinite period of the Ruhr heavy industry. If* payment of reparations; and demilliaxiEaaon.
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US and Western European rearmament, or in creating an atmosphere in which the restrictions on East-West trade could be removed.
Alternative II.
If the USSR believes it desirable to prevent the formalloneparate weststate under exclusive Western Power occupation and tohance both of impelling US and Western European rearmament and of opening up trade between East and West, it must be prepared to settle for an initially non-Communist Germany and to relieve the existing state of tension between East and West.
A decision to adopt this course of action would obviouslyhift in policy but not in ultimate Soviet objectives In Germany and Western Europe. It wouldecognitionhc opportunity to exploit over the short term the postwarsituation" and lo set up Communist governments in Western Europe and Germany had passedhat the USSR must nowonger term approach to its German and European objectives byemporarily neutralizedwhich it would attempt to subvert by other methods. In terms of Soviet Ideology and tactical doctrine, this shift wouldemporary retreat in the face ofand the beginningolicy of consolidation and of preparation for thc next "revolutionary situation" when It appeared.
Assuming that the USSR recognizes that its cold-war tactics haveoint of diminishing returns, it may evaluate its prospectseriod of stabilization and relaxed tension somewhat as follows: Soviet security would be greatly increased If this policy broughteduction or eventual elimination of the occupation forces of the Western Powers and slowed up the rearmament of the US and Western Europe. Thc establishmentnited Germany and the eliminationeparate weststate would open up the whole of Germany to Soviet machinations, even though initially the new Germany would be non-Communist and more inclined toward the West than to the USSR. The USSR would have many avenues of approach to theIt couldoice in German affairs through membership in an alliedorgan, whether or noteto power. It might be able to use morethe nationalism of thc new German state lhan could the Western Powers with their divergent views with respect to the future role of Germany. It could hope that these inevitable differences tielwccn thc Western Powers concerning the future development of Germany might lead to nils in Western unity.nifiedgovernment the pro-Soviet German political parties and trade-unions might be openly extended throughout the whole of Germany. The USSR could offer the Germans food and raw materials in returnarket (oroods which might be Increasingly denied to them in the West On these grounds thet anticipate the possibility ofoviet-German political and economic
Thus, the USSR might hope, at the least, to prevent thc new Germany from being absorbed into the Western orbit and fromaseossible attack against the USSR. At the same time it would prepare for the eventual rise to power of thc German Communist Party when the anticipated dismtegratlng forces within capital-
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;sraevolutionaryermany and Western Europe.thc USSR would beore favorable position lo build up the strength ofconomy and those of the satellites, nnd would continue to develop its favorable opportunities in thc Far East.
3. Cohcxusjons Wits Remhknck to Tit* Two Alter natives.
On balance, the weight of logic strongly suggests that the USSR will attempt to follow tbe second alternative. hoice has been made it will be concealed until the negotiations have developed. The situation today is vastly different from what it was at the time of thc last CFM or the previous negotiations over the Berlin blockade. The ERP has been successfully launched. The Western Union and the Atlantic Pact have advanced from talk to reality. The air-lift has survived the winter. Themilitary aid programarge domestic armed forces budget arc underin thc US Congress. Previously the USSR could hope by its cold-war tactics to prevent or retard some of these developments. The cold-war tactics have now obviously failed to do so. The Soviet response to this failure Ishreat of military actionropaganda peace offensive, an abandonment of firm positions that had previously wrecked the Berlin discussions,roposal to reconvene the CFM. Although it remains possible that the USSR may have In mind only the limited objectives of removing the economic and political disadvantages of the Berlin blockade and regaining maneuverabilityontinuing cold war, there would seem to be compelling reasons for it to try to counteract such basicallydevelopments as Western rearmament and consolidation, the loss of Westernand the economic deterioration of the Eastern area. If ft wishes to accomplish the latter, it seems unlikely that the USSR would continue, or revertolicy that has been unsuccessful in preventing these developments. It can hope to counteract them only by meeting Western termsnited Germany and easing the existing tension between East and West.
4. Implications or Taxsr. Alttju*attves roa tux Wlstun Powers.
Alternative "I" will not present the Western Powers with any serious policyIt will mean thc continuation of past Soviet policies in Germany and Western Europe and the maintenance of the stattuexcept for Berlin. Thc Western Powers have already agreed on measures to deal with this situation. They can continue,serious loss of public support, to develop thc west German state, their restrictions on trade in strategic materials, and the various phases of their political, military, and economic consolidation programs. Over thc longer term, they will of course encounter
difficulties with German nationalism and in resolving their divergent points of view with respect to the future development of the west German state. But the position
is basically tenable and permits the continuance of the current political, economic, and
military policies of the Western Powers
Alternativen the other hand, presents thc Western Powers with serious policy
decisions, attendant upon an entirely new situation. Established policies have been
basedivision of Europe that gave the Western Powers control of Western Ger-
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many andontinuing cold war which muxled public support for military defense measures against the Soviet menace. The new situation will call for revised policies to Insure the Western orientationnited Germany-ermany whichime will be under the supervisionour-power control organ (including the USSR) and which will beosition increasingly to play off East against West in an endeavor itself to fill the power vacuum in central Europe.
The problem of the withdrawal of the occupation forces, Including those of the US, will present basic difficulties. The USSR may wellotal withdrawal of all forces in order to get thc US out of Europe. Even If the Western Powers getto reduce the occupation forcesarrison status, the Germans eventually will esert great pressure for the complete withdrawal of these forces and lt would also be difficult for the USeriod of time to maintain its forces anywhere else on the continent or in England.
An agreementnited Germany will make it increasingly difficult for thePowers to maintain those aspects of their present policy which are designed to strengthen to the maximum practicable extent their military position, andto restrict the Soviet war potential. To the extent that the Soviet Union may attempt lo create the Impression that it isermanent settlement In the West, this difficulty will increase.
Under these circumstances the USSR will probably presselaxation of US export restrictions and other forms of economic discrimination against the iron-curtain countries, if the Western Powers refuse, they can be attacked on the grounds that they are continuing economic warfare and that they not only do not reciprocate the Soviet desire for peace but are continuing to plan aggression.
If the Western Powers desire to maintain their export controls on strategic materials, continuation of ERP aidnited Germany presents senous problems in this respect, lt will be difficult, if not impossible, effectively to control the exports of Germany, and the products of ERP aid can be siphoned off Into Eastern Europe.
A German settlement, particularly If accompaniedarked and continuing relaxation of tension, will eventually weaken substantially public support forprograms and other measures designed to Improve the western military position relative lo that of the USSR.
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ENCLOSURE "A"
DISSENT OF THE INTELLIGENCE ORGANIZATION. DEPARTMENT OF STATE
The Intelligence Organization of the Department ol State dissents fromecause of thc following particulars:
Thc second of the two alternatives whichays Is open to the USSR, namely, "an approach which alms to reach agreement on Oermanyetente In Western Europe" Is vague and confused inwith respect to tbe problem of the concessions which the USSR is prepared to make in following such an approach. Discussion of this alternative implies that the USSR will simultaneously beerman arrangement in accord with its long-standing objectives, and an arrangement which would mean essential acceptance of long-standing Western
It Is the opinion of thc Intelligence Organization of the Department of State that for genuine agreement on Germany between the USSR and the Western Powers it will be necessary for the USSR toodification of Its exclusive control of Eastern Germany without at the same time securing the right of veto over German affairs generally.
It ls consequently believed that despite the advantages to be gained by coming to an agreement on unification the USSR would be most hesitant to make thcnecessary to achieve It. The necessary concession would be that the USSR go so far as tonified Germany, without protection of negative control through veto power. We feel that the only circumstance which could conceivably lead the USSR to makeoncession would be realization that the CFM is In the process of collapsing and with it the last chance toluid situation and to prevent the definitive Incorporation of Western Germany Into the Western European system.
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