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surface manifestations of basic disequilibria
Western Powers will have difficulty in coun-
for which ERP is a palliative and not a cure.
teracting. Likewise, the Western Powers will
The stupendous task of creating a new and
have to reconcile serious differences among
workable equilibrium, with all its ramifica-
themselves in determining the position of the
tions on the internal politics of the states con-
new German state in the Western European
cerned, stands out, therefore, as basically the
system.
most important factor in US security. The
While control of the West German State
development of the US recession into a depres-
is an advantage for the Western Powers in
sion and its extension to Western Europe
terms of the power rivalry with the USSR,
would greatly increase the difficulties of this
over a period of time the frictions inevitably
task. It would restore the subversive capa-
arising out of such control may play into the
bilities of local Communist parties in Western
hands of the USSR. The fundamental objec-
Europe, impair Western rearmament pro-
tives of the new West German Government
grams, accentuate the divergent economic in-
will be to establish its authority on a firm
terests of the Western Powers, and weaken
basis and to unify Germany. The attainment
their hand in dealing with the USSR.
of the first of these objectives will be difficult
Recent Soviet propaganda indicates clearly
if the new state starts out under deteriorating
that the exploitation of an expected crisis in
rather than improving economic conditions.
the capitalist world is to be one of the key-
If the new government successfully estab-
stones of Soviet policy in the immediate fu-
lishes its authority it will find itself in an in-
ture. The volume of material dealing with
creasingly strong position to attempt to settle
the most detailed aspects of the problems of
the German problem on its own terms by
ERP, pound-dollar relations, and competition
playing off the USSR against the Western
for markets has been increasing steadily and
Powers.
shows a clear conception of all the basic ele-
In meeting the demands of the Germans for
ments in the economic problems of the West-
unity, the USSR appears to have the prepon-
ern Powers. Thus, in spite of its defensive
derance of the trumps, if it is willing to sacri-
position at the opening of the CFM, the USSR
fice its control over Eastern Germany and to
can now hope that disruptive forces within
play its cards on a traditional power-policy
the capitalist world will operate in its favor
basis. The USSR can offer East Germany to
while it attempts to strengthen its position
the new state in return for a political alliance
within its own orbit in Europe and the Far
with a united Germany. It can sweeten the
East.
offer by revising the Oder-Neisse boundary in
(2) The Problem of Germany.
Germany's favor. It can offer a potentially
As they leave the CFM behind them, the
broad market for the products of West
Western Powers are also faced with the diffi-
German industry in contrast to an increasing
cult problem of directing and controlling an
denial of markets by the West. If the USSR
emerging West German State. A West Ger-
made such an arrangement with the Germans
man State probably presents them with even
it would obviously be giving up its immediate
greater difficulties over the longer term than
postwar program of trying to get control of
would a united Germany. The problem of
Germany by extending to West Germany the
unification is added to those complex factors
Communist mechanism already established in
inherent in the German problem as a whole
East Germany. It would be a return to the
which seriously complicate it in terms of the
Rapallo policy of a political and economic
ultimate objective of a democratic Germany
collaboration, although within the context of
oriented toward the West, but not the master
a different power equilibrium. The USSR
of Europe,
would probably not be in a position safely to
Although the West German State will al-
adopt such a policy until either it had estab-
most inevitably be drawn into the Western
lished a firmer control than it has now over
camp, the USSR over a period of time will be
its satellites, or until the prospective German
able to offer it many inducements which the
state had become sufficiently strong to defy,
DECLASSIFIED
SECRET
E. O. 11652, Sec. 3(E) and 5(D) of (E)
letter, 1974
By
NLT-
HC
NARS
Date
4-18-77
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"ocrText": "SECRET\n5\nsurface manifestations of basic disequilibria\nWestern Powers will have difficulty in coun-\nfor which ERP is a palliative and not a cure.\nteracting. Likewise, the Western Powers will\nThe stupendous task of creating a new and\nhave to reconcile serious differences among\nworkable equilibrium, with all its ramifica-\nthemselves in determining the position of the\ntions on the internal politics of the states con-\nnew German state in the Western European\ncerned, stands out, therefore, as basically the\nsystem.\nmost important factor in US security. The\nWhile control of the West German State\ndevelopment of the US recession into a depres-\nis an advantage for the Western Powers in\nsion and its extension to Western Europe\nterms of the power rivalry with the USSR,\nwould greatly increase the difficulties of this\nover a period of time the frictions inevitably\ntask. It would restore the subversive capa-\narising out of such control may play into the\nbilities of local Communist parties in Western\nhands of the USSR. The fundamental objec-\nEurope, impair Western rearmament pro-\ntives of the new West German Government\ngrams, accentuate the divergent economic in-\nwill be to establish its authority on a firm\nterests of the Western Powers, and weaken\nbasis and to unify Germany. The attainment\ntheir hand in dealing with the USSR.\nof the first of these objectives will be difficult\nRecent Soviet propaganda indicates clearly\nif the new state starts out under deteriorating\nthat the exploitation of an expected crisis in\nrather than improving economic conditions.\nthe capitalist world is to be one of the key-\nIf the new government successfully estab-\nstones of Soviet policy in the immediate fu-\nlishes its authority it will find itself in an in-\nture. The volume of material dealing with\ncreasingly strong position to attempt to settle\nthe most detailed aspects of the problems of\nthe German problem on its own terms by\nERP, pound-dollar relations, and competition\nplaying off the USSR against the Western\nfor markets has been increasing steadily and\nPowers.\nshows a clear conception of all the basic ele-\nIn meeting the demands of the Germans for\nments in the economic problems of the West-\nunity, the USSR appears to have the prepon-\nern Powers. Thus, in spite of its defensive\nderance of the trumps, if it is willing to sacri-\nposition at the opening of the CFM, the USSR\nfice its control over Eastern Germany and to\ncan now hope that disruptive forces within\nplay its cards on a traditional power-policy\nthe capitalist world will operate in its favor\nbasis. The USSR can offer East Germany to\nwhile it attempts to strengthen its position\nthe new state in return for a political alliance\nwithin its own orbit in Europe and the Far\nwith a united Germany. It can sweeten the\nEast.\noffer by revising the Oder-Neisse boundary in\n(2) The Problem of Germany.\nGermany's favor. It can offer a potentially\nAs they leave the CFM behind them, the\nbroad market for the products of West\nWestern Powers are also faced with the diffi-\nGerman industry in contrast to an increasing\ncult problem of directing and controlling an\ndenial of markets by the West. If the USSR\nemerging West German State. A West Ger-\nmade such an arrangement with the Germans\nman State probably presents them with even\nit would obviously be giving up its immediate\ngreater difficulties over the longer term than\npostwar program of trying to get control of\nwould a united Germany. The problem of\nGermany by extending to West Germany the\nunification is added to those complex factors\nCommunist mechanism already established in\ninherent in the German problem as a whole\nEast Germany. It would be a return to the\nwhich seriously complicate it in terms of the\nRapallo policy of a political and economic\nultimate objective of a democratic Germany\ncollaboration, although within the context of\noriented toward the West, but not the master\na different power equilibrium. The USSR\nof Europe,\nwould probably not be in a position safely to\nAlthough the West German State will al-\nadopt such a policy until either it had estab-\nmost inevitably be drawn into the Western\nlished a firmer control than it has now over\ncamp, the USSR over a period of time will be\nits satellites, or until the prospective German\nable to offer it many inducements which the\nstate had become sufficiently strong to defy,\nDECLASSIFIED\nSECRET\nE. O. 11652, Sec. 3(E) and 5(D) of (E)\nletter, 1974\nBy\nNLT-\nHC\nNARS\nDate\n4-18-77"
}