OIR CONTRIBUTION TO NIE-50 THE CURRENT SITUATION AND PROBABLE DEVELOPMENTS IN EASTERN GERMANY THROUGH 1952

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79R01012A001500030008-3
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 45
• Document Creation Date: December 12, 2016
• Document Release Date: September 13, 2001
• Sequence Number: 8
• Publication Date: November 28, 1951
• Content Type: NIE

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OYR Contribution to NIE?5
TM CURRENT SITU&TICH AND PROBABLE DEVELOPMENTS
Iri Bf.,STWIN GERM&NY THROWH 1952
Ne mmbsr 289 1951
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11 i6ASTl?.RW GERM W THROUGH 1952
1. THE CURRENT POLITICAL SITUATION AND YROBi'BLE POLITICAL D'E' LOPMERTS
ho The Position of the Regime
In Governmental Structure. Ostensibly Eastern Gerxs.ny has a democratic
form of govnrnmento There is an executive branch appointed by the lower
house of the legislature, the Volkskatamero There is also an upper hour,,
the ij enderkatruaner, which represents the various states, The judicial
branch has little independence and the, constitution does not attempt to
carry through separation of power between the various branches of the
i,ovo rnm0nt o
Vhi`le the Socialist Unity (Communist) Party (SED) by itself .does
not hates a majority in the main legislative body, the Volk?skammer, it
nevertheless has secured complete control of this body, At the last
oleotion~ October 1950,, it has forced all the other parties to aerie to
ca singe elate ticket called the "National 1 ronto" Moreover, it has
j 4ced numerous loyal SOD adherents in the seats reserved for representatives
of the so?oailed mass organizations, such as the trade union and youth
organizations. Which were granted special representation in the Volkale~sr~se
Political power mists in the SH,D which dominates the whole govern-
mental and administrative apparatus, Its power derives Prom its olose
collaboration with the Soviet Control Commission as well as from the fact
,,,hat SED members occupy all the key positions,in the admi.n.J.etretion and
the economy of the oountryo
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'., o sitar- tunportn Betw an five and fifteen percent of the East
Inrnan population is estimated to favor the continuation of the present
egi o Probably one-third of this croup consists of convinced believers,
=th the remainder boing. opportunists. The percentage of the population
:hich is politically indifferent, is thought to be negligible, Between
8'5 and 95 percent of the population, therefore, hopes that the regime will
be eliminated, The amount of active or passive resistance which this
predominant majority manifests against the regime, however, is very small]
its attitude is one of passive acoeptancso
Youth furnishes the largest single segment of support for the
regime0 The contribution which other groups such as women and labor
cake is relatively much smaller,, Basically those elements who have a vested
intorest in the continuation of the regime provide its chief support,,
This applies in particular to the 81h,'D, which comprises roughly ten percent
W the population,,
There are probably more adherents of the regime in urban, indus-
trialised areas than in rural areas. Beyond this, with the exception of
cast Berlin,, there is no apparont relationship between the geographical
distribution of the population and support for the regime*
Since the establishment of the regime in October 1949, the extent
of the regimets popular support has inoreasodo This development stems
from the refimsas increasing influence on youth, some improvement in the
standard of living, the indirectness of Soviet controls and exploitation,
&van if all or part of the Soviet occupation forces wore withdrawn
the security apparatus of the regime is adequate to ensure its remaining
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in poser, The position of the regime could be made still more secure by
an Bast Germaa+Soviet arrangomont, providing for a return of Soviet forces
in the event of a serious threat to the roZimea
a. Areal of regime's' program. The lower age group anon- youth is
partioularly susceptible to the a, peals of the regimen Clergy and active
church members are least susceptible. Other groups, such as older youth,,
woman, farmers, artisans, industrial workers, former Nazis, resettlers and
expellees, occupy an intermediate position;
4o Impact on youth,,,. In attempting to gain adherents among the popula-
tion,, the regime has directed its major effort toward youth, especially the
lower age groups and has scored considerable success,,
The age group from 6 to 26 comprises one-third of the total popula..
tionv Even though 75 percent -- comprising the older people in this group
is believed to be opposed to the regime,, most of the regimees support
derives from this groupo Among youth the percentage of those favoring
the regime is higher than in other social groupsj moreover;, proportionally
youth probably provides the, largest, percentage of supporters whose attitude
is not governed by considerations of immediate self-interest. As time
goes on the amouat of active support which the regime receives from youth
will increase still furthers
U, Effectiveness of lecdershipa In the immediate post,i mr period
professional competence was apparently the basic criterion for holding an
administrative position of some consequence, so long as the applicant wms
not a major Nazi Since then this situation has changed,, An actively
pro-Communist attitude, or at least political reliability from the Corrtmtanist
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pobt aC tier, is now more of a consideration than heretofore, mole the
sdaassistrative apparatus is, thus, politically reliable, it is loss skilled
thu.it would .7b* if the political factor were to receive less stress,
aid tioaal factors which further weaken the effectiveness of the administra.
tiie apparatus are= the practice of entrusting position to individuals
ose age and qualifications aro not oaomensurate with their responsibilities=
the deterioration of the educational systems the westward flight of prom
faesiaeal people: and the imposition of 'Soviet method.,
As the social revolution becomes stabilised, a corrective trend
will probably develop, Those administrators who do not now have the
requisite qualifications will learn by doing. Increasingly the choice
before any young person envisaging a career in o;overnmtient 'is simple
either to accept the Communist dictation of East German life or to forego
any chance for such a career, Very probably he would make the former choice,
prospect, then, is that a corps of leaders,, competent at least by
.oist standards, will emerge in Eastern Germany,
On Political parties and groups, Aside from the SED the following
political parties exist in'Sastern Germanys Christian Democratic Union (ODU
Liberal Democratic Party (LDP), Democratic Peasants Party (DBD), and
National Dsmooretio Party (NDPD)o In W ast Berlin, the Social Democratic
Party i. still permitted to exist legally
las CDU and WP are the eastern counterparts of the Christian
femsorstio won and free Democratic Party in:1t9stern Germany, Their
activity has boooane more and more limited so that today their primary purr
oat
pose, as fa./the SED is concerned, is to maintain the fiction that Eastern
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Germany is a multi-party state. The DSD and NDPD were expressly created
by the 8ED to broaden the base of its support among. those elements in the
population who are reluctant to join the SI?.'D or whob because of past lia4
.associations, are not desired in the SED. All those parties participate
in the " Xatioasl Front."
none of these parties maintain any formal ties with political
organisations is Western Germany. However, they are used as unofficial
and personal channels of communication by the SED for the covert dis..
semimatico of propaganda concepts. This is especially true of the CDU in
th. current unity campaign.
To German Commnaiist influence on Soviet policy. Like Communist leaders
the world over, the East German leaders have a dual character. On the one
hand they are the leaders of a national Communist party which at least to
some extent mist espouse national interests; on the other hand# they belong
to the leadership of international Commu nismo ti*henever these two roles
conflict the latter is overriding. While they may participate in the
formulation of Soviet policy on Germanyo they do so in their international
oapaoityo Within Eastern Germany,, they are primarily the executors of'
Soviet policy. In order to made this policy more palatable to the popula..
tiano they may exert an ameliorating effect on the way in which.thia policy
is carried out but they cannot change its main lines.
8o German Communist influence in 0rbit4 There is no evidence on how
mush or how little influence the Nast German Communist leaders have in the
Orbit. 4hatever the extent of this influence, it derives from their personal
charaoteristioa_ and their international, rather than national, positions,
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In. vi+r+ir of the subservience of all the Orbit leaders,to Moscow, any difo
ferentiat ion . of influence is. of little practical importance D
Although the USSR has made abundant use of German technicians and
the various fast Gorman-Satellite treaties provide for the ezohange of
soientitic and technical information, there is only scanty evidence that
German specialists are being employed in the satellite cauntrieso
FQ Soviet control, With the establishment of the GDRD the USSR
replaced its instrument of direct control ?d the Soviet military Administra-
tion (SIA) -a with less obvious but nevertheless just as effective means
and devices of controlo The SMA was succeeded by the Soviet Control
Commission (SCC)a which operates with a smaller and more centralized staff
and whose functions are chiefly superrisoryo The functions exercised by
the various departments of the SM&' were transferred to the new governmsnt0
There are two vital exceptions to this general relaxation of direct
Sarin oontrols., The control exercised by the Soviet internal security
apparatus (Mm) over its Last German counterpart was not modifiedo In the
eoouomio sector, the Soviet-controlled corporations (SAGes) still operate
as an adjunct of the Soviet economy,, with control being exercised by
Soviet representatives directly responsible to Moscowp
As Soviet politiodl control became less direct,, the SED emerged
as the principal and most potent instrument of Soviet policy.
10' Position of regime visa-~vis USSR The leaders of the Last German
arr~..rprr.~.r r
regime are totally subservient to Moscow This condition would continue
tb prevail even if Soviet forces were withdrawn., Even under these air-
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sru1sstanaes, there is little oht uoe that "Titoism" will emerge in Eastern
#ier " Only in a united Germany, under Communist control, would there
exist U* mseessary pro conditions for the. astablishmsnt of a center of
Capwtumist power competing with Mos*Ov
$ Issues and Pores Affootinr; the Regime
1, Hsndiaa to the regime result from Soviet and Communist control.
Traditiasai attitudes. There are several basic traditions in
$arterm Germany which promote latent hostility to the regimen Given suffi4
oient tiesq the regise,.through the medium of indoctrinating youth, will
probably be able to neutralise these traditions sufficiently so that they
do not constitute an important impediment to the realisation of its program0
i~ Perhaps the stron sst of these is anti-Slav nationalism
Gen !s antipathy for its Slav neighbors manifests, itself chiefly in the
cultural sphered Almost all Germans identify themselves with the destern
cultural heritage and consider Slavic, particularly Russian culture,
gaerally interior to their owno Politically,, this tradition has been less
firmly ant"lav.: There is some willingness to enter into arrangements of
oamwenieneeo Despite strenuous efforts the Comm mists are reported to have
met with little success in breaking down this tradition in its cultural
upsetse
ii, Before 1933 Social Democracy and trade unionism were partic
ouilarly strong in Eastern Gerzuzyo In weakening this tradition the
Co gists had the spade work done for them by the Nazis., On the other
hand, the salricquent diaillusion,ment experienced by-'Social Democrats who
agreed to the Socialist-Communist merger, which led in 1946 to the creation
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of the BED, and the. labor policy of the regime have acted as a brake on the
visken,Ug of this tradition.
ifiQ ' The religious tradition of anti-materialism and Christian
,else affemrts wide strata of the populationo Thus far, the regime has
rottalasd from launehiug a frontal attack against the Protestant and
churches although it is probably only a matter of time before such
e
an attack is undertaken
IT*. Finally, although it is counteracted by the tradition of
obedience to authority, the tradition, throughout Germany, of a government
at lams, rather than of men provides the basis for soma of the opposition
against the suppression of individual freedoms and political terror in
fact against all the appurtenances of he totalitarian state. Of all the
traditions this .is the most difficult to deal with because unlike the
others it does. not depend in large part on transmission from one generation
to another e
bo Recent Soviet decisions, Those elements among all groups of
the East Crean population who have suffered out tangibly and directly
from the current implementation of kosocw s German policy can hardly be
expected to be protagonists of the USSR, The grievances arising fray Soviet
implementation of this policy probably contribute heavily to popular die
s
satisfaction with the regimse The Ceuamunist myth that Soviet and German
national interests are identical undoubtedly finds little acceptance*
ks'ertheless, the. dissatisfaction engendered by Moscow's recent decisions
is diff?esi.s$ inchoate' and' largely centered in those groups on whom the
Oemstu 'isO do not rely aarmy for supporting the regimen In addition, the
east deersaar probably consider, at least in part, Soviet occupation policies
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2. Berlin and ;;estexn Gemy
R. . The presence of allied forces in Berlin serves as
strong evidence to the anti-regime elesents of the population that the
Western sorld has not abandoned them.
of
The democratic life/the still accessible Western sectors of Berlin
constitutes a factual refutation of the Communist wopaganda line that
political and, individual liberties are being suppressed in the . West.
be Western Germany. Among the opponents of the regime opinion is
divided between those who favor a neutralized, united Germany and those who
favor the total integration of a united Qermany with the West. The farmer
groupseee in the Western prograu for Western Germany a major obstacle to
the realisation of its aims. The latter group is likely to be heartened
by the growing evidence of Western determination to get on with the job, and
is -believed to be considerably stronger than the first, h4oreover, this
group is said to be! augtannted increasingly tv elements who see in.the growing
strength of the West the only opportunity for a release from Cornmmist dons-
nation.
While these developments may make considerable groups among the
population more restive, it is doubtful that Soviet expolitation of Eastern
Oernan,rvill be significantly affected. Restiveness will be answered by the
regime by further repression and intensified controls.
3. The Unique.
a. Politi ly it po . The East German population undoubtedly
shares the general German desire for unity. Very probably, that desire is
stronger in Eastern than in Sestern Germany because the position of the
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predarsinant majority could not help but be better in a united Germany than
it is now.
In pushing its unity drive, the -regime prdbably derives eocro'
support from elements of'' the popul: tti on who are not basically pro-Ca unity,
such as nati onaii st or Church groups.
b. Avidenye of Hel tion of Soviet Control. Evidence that the
UDR is likely to relax or surrender its control over Bast. Germany in an
effort to slow or stop West Germany's rearmament and integration with the
West consists chiefly of rumors and "private" statements of Soviet and
last German officials to that effect and to persistent effort in the East
German unity caroatnn to convey that impression.
Poriodical1v since the beginning of the current phase of the unity
drive , curie or another Soviet or tart German figure has stated more or less
definitely in private conversation that the USSR in its desire to avert
feat Garman rearmament mould be willing; to allot; ganuine1 r free elections
in Fast Germany even at the cost of its own control, would accept even a
"reaotionary" German government, etc., always with the proviso that the
resultin ; Germany be demilitarized and neutralized. Such statements, plus
a certain amount of wishful thinking in various Western circles, are,
apparently responsible for tie numerous rumors to the same effect which
have paralleled them.
No such statement or rum-or has, however, been followed up by a
aarrresp ng concrete and binding offer on the official level. The
various Nast German Dropoeal8 for all-German'disoueeions dr unification have
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indeed been designed to create an t preesion of willingness to exchange
control of Sant Germaty for German neutrality and disaroanent. The." have from
the first proclaimed the Corec-uniat desire for a "free, democratic and peace-
lovir Oor,sany" .err) they have implied a progressively greater willingness to
cousider syah points as free elections and the necessary Guarantees t: at
each elections would be free, :?rise implication has been conveyed, however,
by the proposal that such points be "discussed" rather than by unequivocal
acosvtance of any Specific guarantee. The ;rmneral concession of "free"
elections itself in vitiated by simultaneous insistence that Co'munist-.
controlled elections already held in East Germar' have been free and a number
of the specific guarantees demanded by the Meat have been categorically
rejected. "lhile the manner in which the latest proposals are being presented
to belligerent in this respect, the East German Communists aftd the
USSR dti71 flatly reject neutral or UN pro-election inspections In Germany
in favor of four-paver inspections with the 'USSR participating under
unspecified coedit .ans.
Continuing consolidation of the 'oviet military position in Last
Germagr by such measures as airfield' construction and enlargement would
also ,argue against arp- likelihood of abandonment of the area in the near
future.
The bal an ce of probable advantages and dis advantage s to the USSR of
such a step would also appear on the whole to be evidence against it. While
a guarantee of the neutrality and demilitarization of Germany might be a
serious blow to the Western de^erise effort, It is doubtful whetior the
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riremi,in's confideace in the long-continued validity or such a guarantee
would be mat. The a$8R could possibly gain under a united, neutral
GOrmaryr certain trade advantat-es in West Germany which it does not AM
enjoy, It would have, however, to weigh against the problematical extent
of these advantages, the certain loss of a large share of the, profit it now
derlvoe from $astern Germany. Surrender of control would also be a serious
blow to. daviut prestige and propaganda effect'.veness, both as an example at
Soviet retreat and as furnishing a convincing exposure, once East Germany
had been opened to the Zest, of the fraud of arevious Soviet and Communist
claim' regarding conditions there.
On balance it would annear that, while the kremlin, ma4Y hope that
the prospect of ooviet retreat frill a ntice the Western porn rs . or the S7est
Germans or both into prolonged negotiations with camquent delay in West
Oermacz r'a progress toward rearrua.ment and integration with the West, it-has
at present no intention of actually retreating,
Prospect for a Soviet-East German Peace Treaty. There is no
tanglible evidence to eug.Mst the possibility that the USSR will conclude a
unilateral peace treaty with Fastorsi Q erramny. (an tie pi ttorn of previous
Soviet tactics in Germany some such stop might be expected to follow
successful conclusion of the current --erotiations between the Western
powers and lest Germany on contractual, relations, much as the formation of
the Federal Republic was countered by the establishment of an East German
state with nominal3y greater sovereignty and privileges in foreign relati.onse
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Soviet and bast Qar ian prestige has )erhaps also become :ssc aewfiat involved
in the targe I date of 1951 set by the cor munist--sponsored plebiscite of
last spring and summar for a r sneral Gorman aeace treaty and it is biirely
conceivable that a unilateral treaty ?a? rht be considered as a p rti al
fulfillmxnt of t'4is -oal.
a.' ere has been no concrete ndication that suds a step is conte:-plated
'tor t:-e aear futures however Certainly little time re:aains for a fulfill-
rent or the 1951 target date; there has been no propaganda build-up as yot
for such a step, and it i.s noteworthy t' gat t -,ie date has received little
e..:iphasis of late.
Such a treaty V.ould !lave re Latively few advantages from the Soviet
viewpoint. Should it be cc'ncl:ided, it woull certainly be played up
arola a:lda-e ise as Indicative of Soviet g*onerosity and as conferring greater
soverei ~Tnty and more benefits otherwise upon East Germany than Nest Germany
eti1o'-,ed under its ahree*>ants vrith the Jest. The Kremlin :airht also hope that
,.are :iraasti.c action could he taken acra::ist the .test in certain fields,.
Berlin for instance, and with less direct Soviet involvement and risk, through
a nominally independent East Garman rovernment than 1,s possible under
;)reeaht c' rcu stFi:lcee.
on balance ho-:ever, It !:ive t?te -L1rei.i1in 'no real benefits which
it does .iot alreadw,f have, and it would have a nualber of serious disadvantages.
11c .matter how it'was re?sresecited in Soviet and East German Propaganda., it
would probably be interpreted in the lest as finalizing the inclusion of
Boat Germany in the Soviet orbit -ind the division of Germany. A. would thus
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turn against the USSR the sentiment in favor of. German unity which it has
itself encouraged and attempted to use against the Went. It would end
the hopes of elements now inclined toward neutralism for a peaceful mifica-
tion of Germany and enlist at least a portion of their support for rearma?
Dent and integration with the Nest. For these reasons alone, such a step
would appear unlikely at least until t7est Gerriany'e new relations with the
West have been rinalized and the USSR has abandoned all hope of weakening
them by appeals for German unity.
Such a treaty would perhaps have more weight in ';7estern eyes should
it be accompanied by Soviet troop withdrawal. ,While the treaty in itself
would tend to make continued presence of Soviet troops less justifiable
politically and propaganda-wise, however, it is doubtful that the Kremlin
would contemplate withdrawal while Western troops remain in West Germany
or before East Germany and the neighboring satellites are regarded as
thoroughly reliable,
Furt'hermore,ile, as noted, the Kremlin might feel that the nominal
independence of East Germany offered a convenient instrument for eliminating
the -,Yesterii position in Berlin, that position would be an even greater
irritant and potential threat under such a circumstance than at present;
if it could not be eliminated.
d, Soviet ctione Rezardii Go,:-,..an Unity. Beyond the elaboration
and intenoif icationt of the tactics now being followed, the Kremlin can take
virtually no action to influence the Nest and West Germany on the issue of
German unity without accepting a' weakening of its control over East Germany.
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Unequivocal acceptance of the conditions laid down by the ffest ad lectern
Oermany would certainly do so.
Moscow may feel, however, that existing; internal divisions in West
bernany and differences between Test Germany and the Western powers and
among the latter still offer favorable chances of at 'Za act delaying Western
progress by a continuation of ats -)resent policy of :raking progressively more
attractive offers of terms on the preliminarysasures to be taken for
unification. Si ch an offer might thus eventually contain specific points
virtually duplicating the majority of the Vestto basic demands with the
hope, horrever, of raroducing negotiations on unity rather than icxedi.ate steps
to:aard implementation. Such negotiations ca .1d still be indefinitely
prolonged by haggling over apparently minor remaining differences without
leading to an actual agreement, implementation of which would endanger the
Coinrnunist position in East Germany.
Until or unless greater divisions appear in the Western ,camp than
have. to date' It is doubtful. whether the Kremlin would expect that actual
-unity could be attained on terms acceptable to itself.
1, - Popular Discontent.
a.- and b. .Thila popular discontent with the ,regime is widespread,
there is no evidence that it is on an ar ganized basis or that it is particu-
larly effective in preventing the regi.r2 from attaining its objective.
Similarly,sympathy.for the West is widespread but it too is diffuse and
unorganized.
CO Because of its very size, youth probably contributes. 'wit
heavily in, numerical terns to popular d iacoent. As a group the clergy
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is reported to be the most solidly anti-regime element. At least among the
Protestant clergy, however, the tradition of submission to the civil
authorities probably militates against manifestations of active resistance.
d. The regime will probably be able In the future to prevent
popul r discontent from coalescing into an orgartaed force.
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in, Cm EC02011IC SITUATION
$canomip.- MM for 1951-1955
At the SAID party congress in July 1950, Walter Ulbricht, Deputy
kewder. of the Dim, first announced the ambitious Five.-Year Plea for the
period 1951-1955, This Plan, in a modified version though basically
eimilaa and. frequently identical in its phrasing, has been enacted into
law by the People's Chamber on November 1, 1951. The main purpose of the
plan is to increase the IDR's heavy industrial capacity in order to reduce
the areas dependence on imports, particularly from west Germany which
was its traditional source of bituminous coal, steel, heavy machinery and
many other products. Under the plan, total industrial output is expected
to double over the present level (which is roughly equal to the 1936 level).
Real national income is scheduled to rise by 60 percent. Steel production
is to reach 3 million tons by 1955, or about three times the 1950 output
and more than twice the prewar production. This level would correspond
approximately to the prewar steel consumption in That Germany. In order
to achieve this result a vast expansion of iron ore and pig iron produc-
tion is envisaged. The 1955 goals for these two items have been greatly
raised in the new version of the Fivb-Year Plan. The target for domestic
iron ore -production has been increased from 1.8 million tons to 3.65
million tons (production in 1951-is estimated at 450,000 tons), and that
for pig. iron from 1.25 million tons to 2 million tons (production in 1951
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about 400,000 tons). Other large increases are planned for brown. coal,
eopper ore, electric energy, heavy chemicals. machine tools, electric
generating equipment, and. trucks. Targets for most of these key
commodities were revised upward in the new version of the plan. For
bawsn coal an additional 10 percent increase was ordered on top of the
55 percent increase stipulated in the original Five-Year Plan in spite
of the known difficulties in providing the machinery for this expansion
of mining operations. The 1955 target for copper ore output was increased
from 1.5 million tons to 2.65 million tons, compared with a present annual
production of only 800,000 tons. The shortage of copper in East Germany
has created very serious difficulties in the manufacture of many key items.
Consumers' goods production which. so far bad lagged considerably
behind that of the basic industries is scheduled to double by 1955. This
would bring textile and leather consumption to approximately the 1936 level.
The agricultural plan for the five-year period calls for a 57 per-
cent increase in the value of production over present levels. US intelli-
.to 11 percent above the prewar level, for sugar beets to 27 percent and for
gence sources I/ estimate that the real value of all agricultural produc-
tion (including livestock) in 1950 did not exceed 75 percent of the prey
level in spite of higher claims (up to 100 percent) by the East German
authorities. The plan envisages an increase in output for grains and pulses
potatoes to 29 percent. Yields per hectare are to exceed prewar levels by
about 5 to 10 percent. Availabilil' y of fertilizer in 1955 is scheduled to
reach the prewar amounts in the. case of potash and nitrogen, but to
,j7 SS Oee IR 5202, . Economic Siti*tion Pt East Germany.-1950, August 7. 1950.
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,expected to remain about 10 percent below in the case of phosphates.
It is estimated that for the crop year 1950/51 nitrogen end potash
19
consmn>tion was only 85 percent of prelrar and phosphates only 50 per-
cent. Generally, food availabilities per capita in 1955 are expected
to equal or slightly exceed the 1936 level.- The earlier hope that
meat, fat, milk and egg rationing could be abolished by the end of 1951
or at the beginning of 1952 has apparently proved to be premature and the
date for de-rationing has been postponed to 19530
The Plan foresees wa e'and salary increases of'16.5 percent over
1950 for the economy as a whole and of 20 percent for industry. At the
same time the general price level for food and consumers' goods is to be
lowered by at least 28 percent. Taxes are also to be reduced. This is
consistent with the planned inc'ease in real national income of 60 per-
cent. Even such a large increase, if realized, would bring private consu p-
tion per capita in 1955 to only a little above the 1936 level, based on a
previous OIR estimate of the'1950 consumption level of 67 percent of 1936.
The Economic Plan for 1951 published in the Spring of 1951 provides
for an Increase of gross industrial production by 17.9 percent above 1950.
This expected increase represents exactly one-fifth of the proposed expan-
sion during the Five-Year Plan. If the proclaimed achievement of about
no, percent of the -prewar level in 1950 is used as a basis, this would
bring 1.951 gross industrial production to about 130 percent of the 1936
level. If the US intelligence estimate zJ of 85 percent is accepted for
see 0 R 5202.
J OIR - HItOG Intelligence. See OI8 5202.
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$WJRI'PT 1>~IORHATYdg
2950.. eaierseaent of the 1951 pleat vaaid rye ind~s trial output to 100
psarosnb of the 3936 lard. "IS Nut 0ssasn govsr m t e3aiss tbat oa an
orssjLll 'basis- the industrial plan bas been ovwfslftiled in the first
three quarters of the year by about # percent, eoq:h admitting that in
soon iWrtext sectors the targets we" not fully reached. In_ line with
the gMs1s1 principle of the Pies-Teary P3+en, 69 largest e3Veasion is
planned for machine eonatr?ation,.and precision end. optical instruments..
A considerable acceleration of the capital investment progrea is foreseen,
partionlarlp in heavy industry, machine dui lading, and transportation
faeilities. It is admitted that the 1950 investment plan was not realized
owing to faulty planning, difficulties in obtaining equipcent (particularly
frog West Gerdy), and wlscat of discipline." The 3,951 Plan singles out
specific plate for the e1ansion progren, including several Iron and steel
mills, machine tool and heavy industrial equipsent factories, synthetic
fiber pleats, and a large electric generating plant. These projects are to
receive priority in the allocation of rear materials, Biel,. and industrial
equipment. In o*der to mitlipte the effects of the acute shortage of
electric power, which cannot be overcome in 1951, the Plan calls for a
better diversification of the power load. CoaVlaints about the inferior
quality of iron and steel prodwets brought a warning from the government
that rolling. mill products must be "decisively' improved. It is also
stated that available capacities mast be used more efficiently than in the
past.
The 1951 plan for agriculture alas at an output equal to the prewar
. Ievsl for the main field crops, which would represent a slight increase
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(between 2 and, 6 percent for the individual crops) over 1950. larger
increases are planned for livestock production, but output will still
remain considerably below prewar. Beneficiaries of the ]and reform will
receive father aid. The a11-powerful Machine Lending Stations (MAS)
will be further expanded, but no mention is made of plans for collectiviza-
tion.
The trend toward increased state control of the economy will
continue during 1951. By the end of 3951 the share, of publicly-owned
enterprises in total industrial production (excluding SAG's) is expected
to reach 76.6 percent, as compared with 68 percent in mid-1950. The need
for private enterprise and its importance for the economy is emphasized,
as on previous occasions, but actual developments do not bear out the
sincerity of this statement.
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at Industrial and Other Goods
Soviet Ta .ln
Soviet takings continued on a substantial level in 1950 although
they seem to have been roughly one-third less than in 1949. Deliveries
to the Soviets were made under any different headings and this makes
an even a pprozinate accounting difficult. The DM I a economic plan for
1950 stated that reparations would amount to 4.4 percent and other
deliveries to the occupation authorities to 1.9 percent of the planned
gross industrial production. This statement is probably literally correct.
The budgeted amount for reparations proper of DM 970 millton and the
planned deliveries of goods to the occupying power of DM 452 million con-
stitute 4.3 and 2.0 percent,, respectively, of the gross production plan
for 1950 of DM 22.5 billion. However, these figures are misleading for
several reasons. Reparations and deliveries to the Red Army are calculated
strictly at 1944 stop prices (or about 20% above 1936 prides) while the
production plan figures., though originally also in terms of 1944 prices,
reflect subsequent upward price adjustments amounting, on the average., to
about 30 percent. Furthermore, reparations are end products and must
therefore be compared with net production values which on the basis of
the 1936 relationship, are only 53 percent of the gross values. After ad-
justments made for these reasons, it was estimated in the middle of 1950
that industrial deliveries in 1950 represented about 17 percent of the
total net industrial production. Very little information has subsequently
become available regarding 1950 deliveries and no better estimate can be
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given at this time. A recent Intel icenae report indicated that actual
reparations deliveries in 1950 amounted to Dot 1,007 million at about
4 percent more than those stipulated in the original plan. This aver-
fulfillment of reparations deliveries is in line with the slight over-
fulfillment claimed for the 1950 Production, P2=*
The 1951 economic plan does not mention reparations or other
deliveries to the Soviets. The only basis available for a 1931. estimate
in the statement by the Soviets of September 1950 announcing that they
would reduce by onessalf the reparations still oared to them of the
original demand of $10 billion. They declared that $3,658,000
(presumably in termfl of prewar purchasing poorer) would be considered paid
by the end of 1950 and that aaa-alf of the remaining amount, or $3,1718000-
would be payable over the period 1951 to 1965- If this amount is to be
%,2l1,400s000-
paid in equal i~tall.m~ants, the annual payments would amount to
Depending on the conversion rate used, this amount would equal about 530 to
'00 nd.ll ion prewar Reiohamarkp, as compared with about RU 800 md.]lion for
1950. There is no indication that occupation costs and goods deliveries
to the occupation authorities have been reduced in 1951. Total industrial
deliveries therefore are probably only slightly reduced and still amount
to about 10-13 percent of the increased net industrial production.
25X1 reparations deliveries to the
Soviet consist predominantly of producers' goods, about half of the value
being accounted for by heavy machinery, electroteohnical products, optical
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and p,roision 3astrumeats, and prefabricated houses. Other important items
are ohemi+oals+ synthetic petrol products, and fishing boats.
Arasmeoeats Prodgotion for the Soviet ikaioa
IBM
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25X1
Reosmatlir considerable evidsnos Las bseaoe available that armament
production is taking place in But Gsr eny.
acids from the production of small arms, weapons components, mzmitions,
and dual purpose equipment, which has been going on for now time an a
limited scale, production of heavy military equipment is being organized
in the area. The manufacture of complete tanks of the type "T34" and
"Stalin" is reported in two plants. In one plant four to six new tanks
are reported to leave the factory each week, while in the other one tank
is said to-be completed every other day. The two plants are reported to
be equipped for hrge scale serial production which so far has not yet
been startodo A large number of plants, mainly SAG +s and VEBts, are said
to be producing tank parts, mainly for the"ra4:" Frequently production
4a reported to be carried on under disguise (such as parts for tractors
or dredging maohities) but it can apparently be established that the
quantities produced exceed by far the need for such spare parts and their
dimensions and speoifiAationa fit only tanks.
=the following tank parts are produced in specif ioally named plants s
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Armor plate for O T340
up to 80 mm thickness in six Plants
Gears for tanks in three plants
Armored turrets for tanks
and perm in . three plants
Tank underbodies in one plant
Luny factories are reported to produce gun parts such as gun
carriages, heavy and medium gun turrets, parts for, anti-aircraft guns,
and gun breaches.' One of the SAG's Is producing railroad net care
of heaviest construction, ostensibly "crane care." These cars were
identified by their specifications as carriers for long-barrelled guns.
It is estimated that about 2000 such flat cars were produced up to the
and of 1950. Special purpose freight cars suitable for the transporta-
tion of tanks and guns and other heavy war equipment are also being built
for Soviet account. One factory produces track removal machines (three
per month) copied from an American model.
Other military items identified in the reports are munitions of
pinny kinds, chemicals such as nitroglycerine, taluol, concentrated nitric
acids gun cotton and poison gases, fuel for jet aircraft and high octane
aviation gasoline.
Among the neny miscellaneous military items produced in the area
are camouflage nets, mi 1i ta7'y boots, military leather goods, uniforms,
field kitchens, military hardware such as belt buckles and canteens.
An important item is the production of fine wire mesh which is needed for
het propelled aircraft and for ore concentration in the mining of uranium.
sum
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26
pas SAG is producing special rapes' bearings for tw and aircraft.
The ten people's caned shipyards are filling orders from the
Soviets toe' an annual prodsetfaa at 250 hags of 450 gross sterid
tows and 50 sei n 's of 350 tons. Alm as ships are suppA
fi~ebdng craft, it is reported that the epseifioatiocs' suggest that these
vessels may be intended for pstrat, ails laying and e~horee po sabion
duties: The baste are delivered to the Soviet navy= the m&ler oases
him i~syoartedly been added to the Soviet Black Sea fleet. Production of
submarine parts such as diesel engines, ape" valves and centrifugal.
is also reported.
Alm no aircraft Arad matian has so far been reported,
accessories are apparently being prods among ahich are precision
ring instruments, bout sits, cameras, p'otsnticetere and others.
There are also reports on production of equipment for air fields, such
as Mbd3,e pager plants for search lights, tank oars for refuelling, tanks
for jet fuels and ssatrvbligbte~
Teleoommgcdostion egnipment or practically every description
including transmitters, ampl.itera, special mobile sending +stations, field
t phaasss, Coulon rers are maxufaotured by a large number of plants for
delivery to the Soviets!
A further 3,ntensification of armament production could be achieved
since most of East c ay's industry could be esal)y converted to military
production. The general development of the tndui tai al eaonaopr in East
Germany pod hts tomrd the creation at the largest pateati a]. Center of War'
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of its present production, including trucks, chemicals, synthetic gasoline,
industries among the Satellite countries. In case of war, East Germany
could readily serve as an advanced supply area for the Red Arm. !kith
etc. are of dual character and could, without conversion, imaaediately fill
pressing needs of the Soviet armed forces.
Uranium Mining
miming of uranium falls within the category of armaments production
for the Soviet Union, Very little specific information is available on
the vast operations of the wismut A.G., which is in charge of the project.
According to East German census figures a total of 242,000 people were
employed in these operations in 1950, and the ==ber for 1951 is officially
estimated at 2$3,000. Even though the company is officially described as
an SAG, it is practically autonomous in order to preserve complete secrecy
of operations. The ore, is dispatched to the USSR in special containers,
probably in the form of concentrate. The uranium content of the ore is
variously estimated at between 0.06 and 1.1 percent; that of the con-
centrate (in one of ten dressing plants) at 2.5 percent. No information
is available as to total output. Apparently no German has access to the
records. In order to gain an idea of the magnitude of the operations, the
following calculation is made. On the basis of an average income of
DM 4,500 per year (as indicated in the East German census for the Wismut
A.G.), and a total labor force of about 280,000 men, the totel payroll
amounts to DM 1.26 billion. Adding expenditures for materials of at least
DUE 300 to 400 million r year, the total cost of operations amounts to
more than DPI 105 bi11i o , or the equivalent of at least 0300 to 400 million.
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Obstacles ...to the Full mnt of the Iiustrial Mail,
Sven under favorable conditions, the East German economic plans
for the period 1952 to 1955 will pose enormous problems to the planners and
the industrial eoonony will be strained to the limit. Shortages will inter-
fere with the even flow of industrial production 4nd hamper the badly needed
improvement of productivity and quality of output. Some of the principal
vulnerabilities of the East German economy at present and in the coming year
are discussed below,
The lack of bituminous coal and coke in East Germany has been one of
the most serious economic problems since the and of the"war. The area produces
at present only about 3 million tons as compared with 3,5 million tons in
1936. Imports of bituminous coal and coke in 1950 amounted to about 4,5
million tons as compared with a little over 11 million tons in 1936. However,
the increased lignite production of 135 million tons in'1950, about one-third
more than in 1936, compensated to some extent for the bituminous coal deficiency.
Progress has been made in expanding the use of lignite for industrial processes,
but the shortage of bituminous coal is very critical in the iron and steel,
chemical and other industries. Minister Rau recently mentioned the coke short-
age as one of the area's greatest economic worries. Considerable hope is
held out for further progress in substituting lignite for bituminous coal.
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 on. The economic plan does not provide for any si$eable increase of bituminous
coal production, but brown coal output is scheduled to rise by more than 60
percent by 1955. East German technical experts have expressed serious doubts
about the feasibility of the program. Should coal production fall consider-
ably. short of the goal and imports of bituminous coal and coke do not in
crease substantially, achievement of other five year plan goals will be
Jeopardized.
Electric Power
Almost as serious as the coal shortage is the shortage of electric
power. Output in 1950, with 18.5 billion.,' was, about one-third above
that for 1936. Plans call for an output of 33.4 billion KWH by 1955, an
increase of 80 percent over 1950. The load on the system is extremely heavy,,
particularly in view of the high age of the equipment, averaging about 26
years. Rehabilitation and expansion of the power system is one of the key
programs in the economic plans. A large part of the needed equipment and
spare parts must be imported from West Germany and West Berlin. Only about
50 percent of the import program materialized in 1950. Production of
generating equipment is planned to increase substantially. The power
shortage may be expected to continue to handicap the overall industrial
expansion program.. Great difficulties in obtaining machinery from imports
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The success of experiments with brown coal coke in the production of pig
iron in low shaft blast furnaces is still in doubt,, The use of brown
coal briquettes in locomotives has raised considerable problems. that have
not yet been solved. Experiments with coal dust firing are now being carried
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and domestic production (simultaneously with the execution of large repara-
tions orders) must be anticipated.
Iron and Steel
The lack of iron and steel, together with the coal shortage,
the area's most pressing material supply problem, and 'the increase of
iron and steel supply is, therefore, one of the key points in the industrial
program. The Five-Year Plan calls for a steel production of 3 million tons
by 1955, or roughly a tripling of the 1950 output.. This level of output
would, however, be only just sufficient to satisfy Eastern Germany's prewar
steel requirements. Pig iron output is scheduled to reach 2 million tons
in 1955s a. sixfold increase from 1950. The iron and steel program requires
an enormous expansion of blast furnace capacity, steel and rolling mills,
and iron ore mining and in,addition calls for substantial imports of iron
ore from the USSR, and of coke from Poland. Some of the heavy equipment
is scheduled to be Imported from West Germany in spite of strenuous efforts
to manufacture a large part of the machinery in East Germany. In the
immediate future large imports of steel, mainly as rolled products, are
required, estimated by DDR authorities at between 700,000 and 9509000
tons in 1951, but it is unlikely that more than 500,000 will be obtained.
Total steel availability for 1951 may be estimated at about 1.8 million
tons., an increase of 30 percent over 1950.. This quantity will fall short
of the goal by at least 250,000.3009000 tons,
Furthermore, there are' qualitative inadequacies. Frequent complaints
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31
of substandard quality of iron.and steel have been officially recognized
in the 1951 plan. It appears that haste in the erection of now steel
mills and lack of skilled manpower are the main factors. These problems
will continue throughout the Five-Year Plan period.
Nor Fe, , Metals
The shortage of non-ferrous metals was discussed with considerable
emphasis in Minister Rau?s speech in March 1951, introducing the 1951
economic plan. The area is greatly deficient in all non-ferrous metals..
The worst shortage is that of copper. Supplies in 1950 were less than 40
percent of the 1936 quantity. Since imports are'difficult to obtain,
domestic ore production is to be greatly expanded, from 800,000 tons at
present to 2.65 million tons in 1955. However, given the low metal content
of about 1015 percent, this quantity of ore will yield only about 30,000
.tons of copper or about one-third of prewar consumption. In view of the
urgency of repair and new production of electric generating equip- nt,
transformers and distribution network, which require large quantities of
copper, the copper shortage is critical. Copper is extremely short through-
out the Soviet orbit; imports from the West are very small and the domestic
scrap collection drive has proved a failure. No substantial alleviation of
this shortage is to be expected in the next few years0
The area.has practically no deposits of learn, zinc, tin, or any of
the minor non-ferrous metals and is therefore largely dependent on imports.
The supply of all these metals is very short, far below the prewar level.
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Moat of the available aluminum reduction capacity was dismantled by the
Soviets, Reports indicate that new capacity is being installed,, but in
view of'the power shortage and the need to import all bauxite, it is un-
likely that production will become, substantial in the near future, Also
short are most of the steel alloys, with the exception of ferro?eilicon,
which is made from quartz which is abundant in the area,
Ghomigala
Most of the basic chemicals are in short supply, particularly
sulphurio acid,, caustic soda and calcinated soda. Great efforts are made
to increase production in the coming years
and the 1955 targets have been
raised again in the recent revision of the Five-Year Plan, Production of
sulphuric acid and caustic-soda is to double by 1955 as compared with 19509
and that of calcinated soda is to increase sixfold. In view of the shortage
of imported pyrites, domestic minerals are to be used as raw material for
sulphuric acid, but considerable technical problems remain to. be solved
Also in critical supply are oxygen, fatty acids, glycerine, toluol
(for explosives), cyanimide salts (metal hardening agent),. resins (for
paints and lacquers), barium carbonate (for steam boiler cleaning), carbon
.bi.sulphide (for synthetic fiber production) and hydrochloric acid (demanded
for uranium mining),
Other risk.
Shortages exist in wood, leather, asbestos, natural rubber, and
textile fibers among important raw materials. Industrial goods in critical
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supply are ball and roller bearings, diesel injection pumps, electrodes,
automobile parts, high-grade metal cuttj.ng tools, transformers, cables,
electric motors, orankehafte, gears, grinding machines and many others.
Tra_nsvort_tion
Another serious bottleneck in the economy is the rail transporta-
tion system which will be even more heavily taxed in the future by the
scheduled 73 percent increase in freight traffic during the five-year period.
In 1950 freight traffic had reached about'70 percent of 1936 and fell about
12 percent short of the target set for the year. The 1955 goal means an
increase of abot}t 25 percent over the prewar levels The freight car park is
to be expanded by. 40,000_ cars, or more than 50 percent compared with the
present park of 70,000-75,000 cars, but will still remain about 25 percent
below prewar. Only 200 locomotives are to be. added to the present locomotive
park of 4,0000
The strains of the rail system are aggravated by the loss of track
due to large-sq4, a dismantling after the war. Only a small part of the
dismantled track has been replaced. The Five-Year Plan envisages the lay-
ing.down of only 750 km of additional track in spite of the fact that about
6,000 km had been dismantled in earlier years, reducing the net to 13,000
km. Replacement of about 2,300 km of existing track is programmed for the
five-year period,
doubt that the proposed replacement and expansion
program can be managed. Close to 100,000 tons of steel per .year are
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required to maintain, replace and expand the car and locomotive park.
Another 40,000 tons are required for the 750 km of new track. In view
of the general steel shortage, it is doubtful whether the total quantity
of steel needed for the program can be made available.
Creditable intelligence has been received that the roadbed, track,
signal, and rolling equipment are in extremely bad condition and that many
emergency measures are being taken to keep traffic: going. This critical
state of the railroads will make it all the more difficult to fulfill the
high plan targets.
Sho ,of s} i.leed abor
Besides the shortage of materials, the scarcity of skilled labor
raises serious problems for the East German Planning authorities. In order
to provide an adequate supply of skilled workers for the realization of the
economic' plans, efforts are being made (1) to increase the total labor force,
primarily by the increased employment of women; (2) to increase the number
of positions for apprentices; (3) to retrain workers for critical trades.
The realization of this program is meeting considerable resistance in the
population.
The total number of employed (excluding persons employed within the
family) is expected to rise by 890,000, or 13 percent in the next five years
In 1951 alone 300,000 additional workers are to be employed.
Very little of this increase can be achieved by reducing unemployment.
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-as of the end of August 1950, a total of only 83,000 men and 1798000
women were officially registered as unemployed. Moreover, more than
half of the unemployed men and about one-fourth of the unemployed women
are classified as handicapped, The number of registered unemployed
represents only a little over 3 percent of the total employed population.
Three-fourths of the scheduled increase in total employment is to
be achieved by the increased employment of women. The total number of
employed women (excluding women employed within the family) is to rise
from 2.448 million in 1950 to 3,20, million in 1955, or about 30 percent.
The share of female workers in the total labor force is to increase from
37 percent at present to 42 percent in 1955. The percentage of women in
publicly-owned enterprises is to rise from 33 percent to 42 percent,
The Labor Law (Gesetz der Arbei.t) of April 1950 obligates all
enterprises and administrations to employ women to the largest possible
extent. The law provides for the employment of women in the mining industry
and other trades never before open to female workers.
The apprentice plan for 1950 provided 2218000 positions for the
333,000 juveniles leaving school in that year. For the first time certain
percentages of these positions were earmarked for female apprentices. In
the field of precision mechanics and optics, at least 70 percent female
apprentices are to be employed, and in the ready-made clothing industry
98 percent.
The drive for increased employment of women follows a well established
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Soviet pattern. German tradit&on, boiever, has so far reoisted- this trend.
TW Shat tags of sklllmd tortes in partioularly acute in the mining
and metaUnsgical industries, The quality deficiencies in the output of the
new iron aDd steel mills aunt be largely attributed to this factorb
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~/ S CU 3.~.p1' li+ir'C u`L0N 37
General Difficulties of Economic PlazMiPA
To the physical shortages mentioned above must be' added the general,
difficulty of developing and pursuing a balanced and cot istout econ i.c
plan. The.'E t German authorities have had only limited experience with
the problems of coordination. and phasing 'Which this involves. Further-
more, since many production goals must be messed in monetary terms.,
the problem of price changes (Which, era envisaged mainly in form of
specifio cost reduction) becomes important, and it is obvious from the
literature on the subject that these difficulties have not been solved.
The flow of funds is another problem that has bothered the authorities.
It seems that =uW public eute~prises have not strictly ccvaplied with the
now regulations which require them to surrender their current assets to
the central budget, but continue to retaina certain proportion for their
The Pattern of Et=Al Trade
The economic plans for the period 1951?.1955 rely heavily on
large imports, particularly of critical materials, such as iron and steel
products, : non -ferrous metal:, bituminous coal and coke and specialized
machinery. Trade developments so far have not fulfilled expectations.
In 1949 the volume of fcareign trade-was estimated at about 20 percent of
the 1936 level, :chile interzonal trade reached only about 7 percent.
Foreign trade plans for 1950, which envisaged more than a doubling of the
trade vol w e, were not fulfilled. At the beginning of 1951 it was
officially stated ' that the volume of foreign trade in 1950 increased 42.9
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percent over 1949, which would put the volute of East Ueman foreign
trade In 1950 at roughly 30 percent of pre =w. Trade with the USSR
a'md the Satellites increased by 56 percent according to the same source.
Applying these percentages to the 1949 figures, it would appear that the
share of the Soviet orbit in East Germany's total trade has risen frog
79 percent in 1949 to 87 percent in 1950. The 1951 plan provides for
an increase. of 60 percent over 1950, with particular emphasis on ;trade
with the Eastern bloc. If this goat is achieved, the volume of foreign
trade would reach about half the 1936 level. Judging from tl}e official
criticism leveled at the For sign Trade Administration, it eeems, however,
that foreign trade got off to a slow start in 1951. Agreements finally
concluded.-notably with Czechoslovakia and Poland, provide for a sub-
stantial expansion of trade. Trade with the western world in,1951 is
apparently somewhat larger than originally anticipated. In the second
quarter of 1951, this trade accounted for 20 percent of East Germany+s.
total foreign trade, rather than 13 to 15 percent as previously anticipated.
This increase may be explained by the greater frequency of three-cornered
deals to circumvent interzonal trade restrictions,
East-West German (interzonal").trade in 1950 was about one-third
above 1949 (1949 was law because of the blockade in the first part of
the year), bringing it to a level of about 10 percent of the 1936 volume.
West German deliveries to the East in 1950 consisted largely of steel
products and vital industrial producers' goods. Metallurgical products
accounted for about 30 percent, machinery for about 17 percent, chemicals
for about 20 percent and metal products for about 6 percent of total
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deliveries. The new interzo.ial trade agreement recently signed, but
not yeb implemented, provides for a- similar pattern of West German
deliveries, but permits a greater flexibility in determining the specific
goods to be delivered. Actuu ly, ho rever, East-West German tradi
decreased by about one third c:.ring the first half of 1951 compared with
the average for 1950, and its relative importance in East Germany's total
external trade decreased to About 10 percent.
It suns obvious the' the DDR. will continue to make determined
efforts to obtain critical oupplies from the test. Recent developments
indicate, honover, that a substantial increase of legal -dest German
exports of strategic materials to East Germany is unlikely. On the other
hands East Gorman attempts to procure the desired co=odities by illegal
means will 'probably be inter.,^ified.' Should actual imports in 1951 fall
considerably below the plann d level, as is likely, the industrial pros
dnation goals of the 1951 PL -m will probably not be reached.
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P79RO10OO15OOO3OOO8-3 40
Wb TB m mm UILI SZTVATION' AND PRGBA$LE MILITARY DEVEW
The Bt stems Geri an Qs,'ouud !orces
2. 'A raplCk expaaunz iat of ,'im Alert Police wa":a13 have ecrio?. poliitiofti
reporenaeiana in Western Geri zy. It would presvide the West Qerrmne With
dran*tio ec oe of the ncccl for clc e ly developing a West Germs counter-
force. Moreover, it might roll bav + an adverse effect on saow'o relations
with the Qtber 3atelliteii,, v+t:o -arould view the extensive roan nt of Pastern
Oern ny with misgivings even though it core done under Co ti,cat auspices.
An additional factor is the eur- ont Comm mint emphasis on the f ulf i12 nt of
industrial targets o. If the Alert Police mere rapidly expenodthe lebor force
needed to fulfill industrial targets would he reduced. The low morals among
the Alert Police as mall as then probability of adverse public reaction am
further oone?.derations.
4. go apeoial effects of the East Germ n peace and anti-r'earw=at
campaign live been. observed along the Alert Police. Generally speaktg,
beoaue, of tb monotcxay of tkao propaganda there s the fact that part of
the propaganda expenses is charged to membora of the Alert Police, and the
general lack of political eu iocity, political indoctrination in the Alert
Police has not beex- too sucocr full
S. i. Ibmber. An eeti ted 200,000 PWCa tyre still hold in the USSR*
it. Soviet intentional There are no indications that (e n
PP/Me are presently organised in unitary units.
While carefully selected and indoctricatOd PV's are Icioavn to have been
to c n into the Alert Pol lco is the past and have frequently boon given impor-
tant position3, there is no indication that position in, the 'Alert Police
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are still bei sg filled by Pale Drom the USSR. Such a development for say
approaiable weber of Pt*'#3 2s liks2y for the future, eiaoo long oeptiiity
hoe =,de these am p2yeios 4y and paq+ohologioat v Wit for military
oearo'ie9 for the Soviet cute, rd because if they w rv potential military
a a ta t i a i , t h e y w o u l d h a v e been givon better treat mat or perhaps already
havo been oorgan3sed in military unite. For the own roon1 it is un lil sly
that PWae still r,em ring 1 the USSR will bs organized into a terms armod
false in the 111$SR. This does not prea2ude the ocoasi oral use of Gersim
military azperts among the PP:'c an the basis of any special skills they
may hove.
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Ve J-D1? IOUL ICAT M OF PROMM SOVM CO QP :ACT ICn
i s Abs nog of &IV (IOM Bast Euro Dofgnso Pacts Bast
on tai1o to have mt l d.fenaa pacts with the M SR aaa4t the other
SatQ113' a ioald appear to to In part a reflection of ito forctl sta#un, ac
a teritory occupied by the Soviet. thion with no officially -recognized
almod farces or its ova,, an in part due to the psychologioal inadvisability
of urging such plots on countrJas such as Poland and Czechoslovakia with
stres g residual. antif.-tar feelinj among their populations.
2hus, the present status 'of East Garrany in effect oommits the USSR
to its "defense" while East Germany itnelf has theoretically nothing to
contribute to the defense of the USSR or other satellites. So lox as the
fit Coal ist tine on Germany is folloaed3, raoognitlon, explicit or
implicit,. of a military role for East Germany would have obvious adverse
payrrht~lagical effects in the West and among the Eastern h' u ropoon satellite .
similar to those already disaucsod for a separate treaty with - East Geri ny
With regard to the East European sateilitess, the concentrated Omphaoic
receatly placed on campaign of G mm-Polish and tko ?Csaoh "fr3 dehip?
would Indicate that much rovains to' be done d j may of scetwing popular acoopp
tsnoe of relations already existing or projected bstwoen tho a aotuatries and
Germany, let aloud the preparation of public opinion for alliances with a
rears ad Gerrmny,
As an additional point, it should be romambered that similar exisitlag
pacts between the tlSSR? and othois axe still forsally directed against (dome
it is also worth noting that the network of these pasts' is net conreto even
amoa the satellites to the extent that every satellite bm concluded one with
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 wary other. Tn general the absence of euoh pacts uou2d as z to, have no
04M ioua effect .on the actual control of Past Gersz or its tactual Latin-
aim In tho Soviet orbit.
2.. tip NLAOMI !SWIM t bb sotvos, - Soviet policy . Gcr
hes shaft oonaiderab? a s,pparsnt flnctuatie in Its dei ailed applicat io and
tote a rsas$veeness with *ic4 it has been p auo . TI ,0 a pnrio4 of pha?
st an reparations through y a anal of capital egtatp i nt , and general looting
of the Sant Ger eoonarW mas felled by cm of atrenuoue efforta to
rebuild thet eeoonony, with remamls taken frarn current produotion* A orioc!
in eahich the Kremlin sought additional ovort influence in Car a affairs
through four-power char ela has been follovsed by one of e>nphani?e an reaatora '
tier of G rmen sovereignty r.ith Soviet influence to be exerted through the
list Gere*n Oonamists. A th3nl vo led ?ffe to force.Woetern eevaouatie
at Berlin was suspended ' in. then face of doteri43ned resistance, and though
pressure on-the Voctern position in Berlin has. continued, it harp e.voldod
? ostenatble challenge of the'Soatle right to be there,
In general such. fluctuation my indicate an adaptation of tactics m d
poasiblsr of Short-term objectives to varying conditions and charging astUate6
of relatively early eucoeeca in attaining long-term ob jeotivas. The remlln
n a y a t first h a v e a panted a relatively ehort occupation of Go '
later have felt that ohanova of axpending its control over all of Gory in
the near future gore relatively good, and finally have revised this eatiazac o
in the face of greater difficulties; than expected, though evidence in thoso
rsapscts io by no moena oanolus ivee.
Soviet policy has been uniform howevor In progressively atrengthanSng
control of East Germany and excluding Western influence from the area and in
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 eeslcf by a Vsrf of rnoano Oro for influunee in West 3er e~ In this
respect it has been consisteza, with an ultimate goal of expanding Soviet
control over tba i holo . of 00rn. 1 ht1I1 its flitot sti ons in application
my indicate ape iodin rc irion of the time ?fac :ora they &YPeILr In no -,,my
to indicates any cl e In the ,cal ftrelf ?
3. Soviet .Polio in ticrrr as an. Iwi'ioeator of Soviet Polio Elsewhere o
pr. indications' as to
The general lines of Soviet prslicy .in Gowany may 6v
the general Soviet policy to by followed eleeu aa'e. Thus, for instance, the
e xpensiaaaist tondoaaics avic ort in Gamy are undoubtedly characteriotic of
Soviet policy in general, e*nd the Soviet attitude to rd rearm ont In Japan
y be ezpeoted to be similar to its attitude ftoard rearm nt in oormanro
Soviet. policy in Germany ocan,, ho ver, give little reliable, indication of the
specific courses of action rich the' Jroialin ray be expsoted to tolls r in.
implcrosnting ita policy in other areas and under t feront lc l conditic as.
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