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    "localId": "470155071",
    "label": "Report, Central Intelligence Agency, Review of the World Situation, CIA 12-49",
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    "title": "Report, Central Intelligence Agency, Review of the World Situation, CIA 12-49",
    "citationUrl": "https://catalog.archives.gov/id/470155071",
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        "President's Secretary's Files (Truman Administration)",
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            "day": 21,
            "logicalDate": "1949-12-21",
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    "seq": 9,
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    "ocrText": "SECRET\n6\nconvertibility of currencies among the mem-\nC. Franco-German Partnership.\nber nations. Some success is probable. On\nWhatever the context of initial steps to-\nthe other hand, simultaneous attempts to co-\nward economic \"integration\" in continental\nordinate fiscal, credit, commercial, and ex-\nWestern Europe, bringing in the West Ger-\nchange policies among the same nations, are\nman state as a member of the region even-\nunlikely to achieve very much within the next\ntually will be necessary. The Bonn Protocol\nyear. All of these preliminary steps in West-\nofficially marks the beginning of a conscious\nern European economic \"integration\" will\neffort by the Western Powers to bind Germany\ntake time. Regardless of long-range economic\ntightly to Western Europe with ties of political\nbenefits, probably they will never get whole-\nand economic interest. If the effort succeeds,\nhearted support unless governments, indus-\nany future disruption in artificially divided\ntrialists, and labor leaders become convinced\nCentral Europe will find the fifty million West\nthat \"integration\" will not entail even tem-\nGermans lending economic and eventually\nporary industrial dislocation and unemploy-\nmilitary strength to the Western European\nment of any consequence.\nregion. A corollary advantage would be the\nMany Europeans believe that building a\nmagnetic attraction a West German orienta-\n\"free-trade\" bloc and an \"internal mass mar-\ntion toward Western Europe would have on\nket\" is a distant ideal if not wholly an illusion.\nthe Soviet-Zone Germans. The French, de-\nThere is considerable uncertainty about the\nspite strong misgivings, have accepted this\nchances that \"integration\" will solve the basic\nprogram. Whatever the French do in the\neconomic problem of inability to compete with\nFritalux association will stand or fall finally\nthe US in US and world markets. There is\naccording to whether the association can ac-\nalso fear that long-range benefits in any case\ncommodate Germany as a member. The\nwill not come in time to offset the social and\nproper time for full partnership between\npolitical dislocations that would result from\nFrance and Germany cannot be far off. The\nefforts to rationalize the continental economy.\nWestern Powers have travelled the long path\nSome reduction of profits from capital invest-\nfrom the Morgenthau Plan to the Bonn Proto-\nment and at least temporary, local unemploy-\ncol in four years, and French leaders of the\nment would follow the elimination of indus-\nmoderate middle parties can point to no other\ntries now able to survive because they have a\ncourse than to take the remaining steps to-\nprotected home market. The moderate middle\nward Franco-German partnership whenever it\ngroup of parties now dominant in the Western\nis politically feasible at home.\nEuropean nations would lose political control\nIn facing up to this regional prospect the\nif the dislocating effects of rationalization\nFrench are tending to rely on three devices to\nwere not offset quickly by regional benefits.\nkeep Germany from quickly becoming the se-\nConsequently substantial progress toward\nnior partner in the Western European firm.\neconomic unification on the continent is\nFirst, of course, is the influence of France's\nmuch less likely to come if sole reliance is put\nstronger associates in the Atlantic Pact\non the eventual \"mass market\" in Europe\ndefensive system, which ties Western Europe\nthan if measures to this end accompany other,\ninto the US and British security sphere. Sec-\nextra-regional economic developments. Such\nond, France is relying on the development of\nextra-regional developments might be in-\nregional political institutions. The French\ncreased US imports or the development of\nAssembly recently has made extraordinary\nAfrica, the Near and Far East, and Latin\ncommitments in the direction of limiting its\nAmerica as markets and sources of food and\nown sovereign powers in the interests of trans-\nraw materials for Europe. Regional \"integra-\nforming the Council of Europe into a quasi-\ntion\" is no economic panacea for Europe. It\ngovernment with limited but effective legis-\nis likely to succeed only if the regional econ-\nlative and executive powers. If the British\nomy fits into a balanced pattern of trade and\ncan be entangled politically on the continent,\neconomic growth in the entire non-Soviet\nFrench chances will increase of bringing ef-\nworld, including the US.\nfective supra-national pressures to bear on\nDECLASSIFIED\nSECRET\nB. O. 11652, Sec. 3(E) and 5(D) or (R)\nOSD letter,\nNARS\nDate\n4-1A.77"
}