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INCOMING TELEGRAM DEPARTMENT OF STATE-DIVISION OF COMMUNICATIONS AND RECORDS TELEGRAPH BRANCH 4X surgery DECLASSIFIED Action: GA Inf : E. O. 11652, Sec. 3(E) and 5(D) or (E) Dept. of State letter, SS Control 951 By E NLT- He NARS Date 1271.75 P Rec'd October 4, 194,9 G 9:13 a.m. H EUS UNA FROM: Moscow 53 USTO OLI TO: Secretary of State OTA AAN NO: 2497, October 4, 11 a.m. K.S. DGR Although punch line Soviet note re Germany (EMBTEL 2474, October 1) is statement penultimate paragraph "new situation has been created in Germany at present time" thus establishing for the record basis for Soviet freedom of action, text of note does not in itself give decisive hint as to what steps Soviets likely take in response our initiative in encouraging formation Bonn Government. Coming at critical juncture various problems in which Soviets have conside able stake (Yugoslavia, China, atomic energy, "peace campaign", Austria, not to mention MAT and MAP), Embassy believes that Soviet note represents more than propaganda gesture and may be intended lay ground work for carefully worked out move or series of moves calculated counter our perceptible progress Western Europe and Germany and advance Soviet Communist cause this area. In view favorable atomic energy and China positions Soviet may feel they have chosen opportune time this step toward regaining initiative on German question. Our observers in Germany obviously in better position evaluate significance Soviet note in light internal developments there, but fact that top German Com- munist leaders have recently visited Moscow (EMBTEL 2412, September 26) indicates that they consulted on Soviet note and points emphasis direction Germany itself, possibly foreshadowing establishment Eastem German government claining right speak for and repre- sent all Germany and related renewed pressure rorce Western powers out of Berlin. Difficult see how 1 st objective would be achieved in view our successful display determination remain last year, but Soviets may feel INFORMATION COPY