GERMANY: Toward the Razor’s Edge?

The occupation of Germany was entering a new phase. By partitioning eastern Germany, the Allies had destroyed the old Reich. By quartering what was left into occupation zones, the Allies had quadrupled their problems and troubles. Last week the victors reached across their respective zonal boundaries, began an effort to treat the new Germany as a unit.

First major step was the organization of five all-German ministries (transport, finance, communications, trade, industry) which are to be directly responsible to the Allied Control Council. The second was an economic program for the whole of Germany.

This blueprint was yet to be worked out and approved in detail. But the starting principles had been agreed on: the four zones would exchange goods and services; Germany would be allowed a limited, rigidly controlled import-and-export trade.

Given all the breaks, the Allied Control Council would have to blueprint a miracle. By decree of the Big Three at Potsdam, the Council must destroy Germany’s war potential without destroying her ability to subsist. It must select and encourage industries which do not make a war potential (in the long run, most industries do). It must calculate a minimum economy for Germany, and take steps to hold Germany to that minimum.

One thing was certain: the precepts of Potsdam could be carried out only if Germany was one administrative unit. And all this had to be accomplished by the economic opposites of east and west. Already the pressure to reduce the U.S. occupation armies (see NATIONAL AFFAIRS) was seriously hampering General Eisenhower. Predicted Britain’s Economist: “The Potsdam settlement will not last ten years, and when it breaks down there will be nothing but the razor-edge balance of international anarchy between civilization and the atomic bomb.”