The end of war and the effort by the Allies to restore order in Europe brought on many unexpected difficulties. The early stages of the occupation of Germany and Austria resulted in new tensions. Under the terms of the unconditional surrender of Germany, the Allies had absolute authority and complete control. But the major problem was how to work out occupational arrangements that would be satisfactory to each of the Allies.

There was no German government except for a group at Flensburg under Admiral Doenitz, who claimed to be the acting authority of the Reich. We paid no attention to Doenitz, although our Army kept a vigilant eye on him.

In Austria, we faced a Russian occupation with their usual “provisional government” setup which was completely under Russian control and which claimed to represent all of Austria. We protested to the Soviet government that the provisional government in Vienna had been formed without consultation with the Americans, the British, and the French. The American chargé in Moscow had been instructed to inform the Soviet government “that while we do not object to the establishment of native local administration in occupied areas, we do object to the Soviet government permitting the establishment of a government claiming to represent all of Austria, including the American occupied zone. Full consultation should have taken place and effective consultation will be possible only when allied representatives arrive in Vienna and joint control begins. Until then the American government is not associated with and accepts no responsibilities for measures taken in the Vienna area.”

The chargé was instructed also to restate the American position regarding the zone of Vienna and to point out “that it is the Soviet government which has been refusing to follow the German precedents and subdivide Greater Vienna in a manner which will give us the facilities we require.”

Both in Germany and in Austria, the major task facing us was to set up control machinery and to arrange for the withdrawal of the Allied troops to their respective zones. In Austria none of this work had been done. In Germany, however, the preparatory work on occupation and control had already been completed by the European Advisory Commission. Only Soviet approval was needed before the details of organization in each zone could be made public.

It was our plan, to which the British had agreed, to dissolve the combined headquarters of General Eisenhower (SHAEF) as soon as the zones of occupation were established. Eisenhower would then be placed in charge of the American zone, Montgomery would take over the zone allocated to the British, and a French general would be in command of that portion of the original American sector which was to become a French zone. These three Allied officers, together with the commander of the Russian zone, would form the Allied Control Council for all Germany.

On May 10, General Eisenhower recommended that the dissolution of SHAEF take place as soon as the American, British, and French forces had occupied their respective zones.

On May 11, Churchill cabled me urging that our forces be kept on the farthest advanced lines they had reached. In spite of the fact that he agreed to the occupation zones, he asserted that the Allies ought not withdraw from the positions they had reached until we had been satisfied about Poland and other problems we had with the Russians.

Churchill followed this note with other messages on the subject of the withdrawal of our troops. He said he was disturbed by our plans for redeployment to the Pacific and asked for a standstill order on the movement of American forces. But we were still in the midst of a major war in the Pacific, and our troops were needed there. Furthermore, there was public clamor at home for the return of troops not going to the Pacific.

I had already indicated to Churchill my intention to live up to the commitments we had entered into with regard to the zones of occupation, and we had no intention of extending ourselves beyond those zones. I took this position after consultations with our military chiefs. Russian tactics and aims were, of course, of much concern to us, and I agreed with Churchill on the seriousness of the situation. But I could not agree to going back on our commitments. Apart from that, there were powerful military considerations which we could not and should not disregard.

Churchill and I exchanged a number of messages about these matters, and on May 16, I addressed a message to Stalin, who was still refusing to permit our troops to enter Vienna.

“I am unable to understand,” my message read, “why the Soviet authorities are now refusing to permit American and Allied representatives to proceed to Vienna, contrary to the good suggestion you made to Ambassador Harriman on April 13 that representatives go there to study the Vienna zones of occupation, in order that the agreements on the occupation of Austria now pending in the European Advisory Commission may be completed.

“Intelligent arrangement of the Vienna zones would be greatly facilitated by an examination and discussion on the spot by the military authorities who will later be responsible for smooth operation of the inter-Allied administration of Austria. For example, the Soviet representative in the European Advisory Commission has recently proposed that the air communication needs of the American forces be met by placing under American administration the airport at Tulen, twenty kilometers northwest of Vienna, in lieu of an airport in Vienna itself. However, neither he nor we know the precise dimensions or conditions of this airport, and to give his proposal proper consideration we should be permitted to survey it.

“Since the area to be zoned is no longer in enemy occupation it seems only reasonable to examine it, as you suggested, in order to facilitate completion of the agreements in the European Advisory Commission. Continued refusal of the Soviet authorities to permit this, in spite of your original suggestion, would not be understood by the American public.

“I therefore hope that you will yourself let me know whether you will issue the necessary instructions to Marshal Tolbukhin to facilitate a survey by the Allied representative of those Vienna areas which are now under discussion in the European Advisory Commission.”

Stalin’s reply reached me on the eighteenth.

“I have received your message of May 17,” it read, “regarding the trip of American and Allied military representatives to Vienna. It is true that I agreed in principle to the arrival in Vienna of the said representatives, but, of course, I had in mind that by the time of arrival there of the said representatives a necessary understanding will be reached on the question of the zones of occupation of Austria and that the zones themselves will be specified by the European Consultative Commission.

“As it was agreed upon among Mr. Churchill, President Roosevelt and myself such questions are entirely within the competency of the European Consultative Commission. I still adhere to this point of view at the present time. Therefore it would not be possible to agree that the question about zones of occupation and other questions concerning the situation in Austria be transferred for consideration to Vienna.

“I do not object, however, against a trip of the American and Allied representatives to Vienna for the purpose of acquainting themselves on the spot with the situation of the city and for preparing proposals regarding the zones of occupation in Vienna. In accordance with this necessary instructions will be given to Marshal Tolbukhin.

“Besides, it should be kept in mind that the American military representatives could arrive in Vienna by the end of May or the beginning of June, when Marshal Tolbukhin, who is at present on his way to Moscow, will return to Vienna.”

Our problem in Germany now was to get the Allied Control Council into operation. Germany was in effect being run by local military commanders. There was the danger of complete economic and social collapse of the country. Therefore, it was imperative that there be established at the earliest possible moment a council to make policy for Germany as a whole and to direct the administration of Greater Berlin.

On May 22, the United States, Britain, Russia, and France approved the formal declaration of defeat of Germany drawn up by the European Advisory Commission. The four military commanders would meet in Berlin early in June to sign this document and would remain there to work out the details of Control Council machinery.

In approving these plans, it was my purpose that Germany would be treated as one country, eventually to be placed under one government that would be subject to checks by the Allied Control Council in order to prevent a re-emergence of Nazism and Prussian militarism. At this time, Admiral Doenitz was placed under arrest as one of the top Nazi leaders listed by the War Crimes Commission.

Acting Secretary of State Grew reported to me that in a discussion on May 16 between General Eisenhower and Churchill, General Eisenhower pressed for an early control by the Allied Control Council for Germany, even though the Russian representative might have to refer everything to Moscow.

Eisenhower expressed the view and position taken by Churchill:

“Although Churchill agreed that this matter should receive urgent consideration he feels that SHAEF should be responsible for the control of Germany until some other body is established to take over. He did not appear to be in any real hurry about this matter, Churchill stated full agreement with the British Foreign Office memorandum which among other things pointed out that the need to establish some German government was becoming ever more apparent. Churchill stated that the Allies should not assume full responsibility for Germany but should only take measures to prevent Germany from ever being able to start another war. German problems should be handled by Germans and some of the German generals now held by us might be employed for this purpose since they would be obeyed by the German people. Among other points mentioned by Churchill were a reduction in rations for non-working prisoners of war and a statement that German war equipment, particularly aircraft, should not be destroyed but should be kept to equip liberated nations.”

On June 2, General Eisenhower, as head of SHAEF, cabled the Combined Chiefs of Staff, asking for instructions on the date of withdrawal of our remaining troops to the designated zones of occupation. His telegram read:

“It is anticipated that one of the questions which will be raised at Berlin meeting to sign and issue declaration will be date on which our forces will begin their withdrawal from Russian zone. It is possible that Russians may establish such withdrawal as a corollary to the establishment of the Control Council on a functioning basis in Berlin and to turning over the several zones in Berlin to the forces to occupy these zones. Any cause for delay in the establishment of Control Council due to the delay in withdrawal would be attributed to us and might well develop strong public reaction. We have as yet no instructions covering such withdrawal. It is believed desirable that separate instructions be given to me as American commander and to the British commander prior to Berlin meeting as to how we should reply to this question if it is raised.”

The Chiefs of Staff, with my approval, instructed General Eisenhower on June 3:

“The question of withdrawal to our own zones should not be a condition precedent to establishment of the Control Council on a functioning basis and turning over of zones in Berlin. If Russians raise the point, you should state in substance that the matter of withdrawal of forces to their own zones is one of the items to be worked out in the Control Council. As to the actual movement of U.S. forces, you should state that this, in your view, is primarily a military matter; its timing will be in accordance with U.S. ability to withdraw their forces from other than their own zone and British and Russian ability to take over.”

On June 4, Churchill again urged against the withdrawal of American troops to the designated occupation zones. He said that he viewed “with profound misgivings the retreat of the American army to our line of occupation in the Central Sector, thus bringing Soviet power into the heart of Western Europe and the descent of an iron curtain between us and everything to the eastward.” He hoped “that this retreat, if it has to be made, would be accompanied by the settlement of many great things which would be the true foundation of world peace. Nothing really important has been settled yet, and you and I will have to bear great responsibility for the future.”

On June 5, the declaration of the defeat of Germany was signed in Berlin by the commanders of the four Allied armies. At the meeting, the Russians made it plain that they felt that the Allied troops should be redistributed into their respective zones and that a governmental decision regarding the delimitation of those zones had to be made before the Control Council was organized. The State Department reported to me on June 8 that “General Eisenhower forcefully pointed out that Allied Military Government had become a fact in Germany through the signature by the commanders of the four-power declaration on establishing supreme authority. . . . The meeting terminated with agreement that the problem of redistribution of forces is one to be settled by government decision and that each commander would refer the question to his respective government for action.”

The State Department report, quoting Eisenhower’s political adviser, Ambassador Murphy, concluded:

“Murphy secretly informs the Department that he believes General Eisenhower does not consider it wise to retain our forces in the Russian zone nor does he feel that it would be productive of advantages. Murphy personally believes that there is no ground for any discouragement in these developments and on the contrary finds definite progress has been made. He is convinced that the Soviets regard the Control Council as necessary and its operation as redounding to their interest.

“Marshal Zhukov has accepted General Eisenhower’s invitation to visit him on June 10 at Frankfurt.”

Hopkins, on his return from his meeting with Stalin, stopped off at Frankfurt, Germany, to talk to Eisenhower. On June 8, he informed me that he had discussed the Russian situation in Germany with Eisenhower and got the general’s impression of his talk with Zhukov. Hopkins was convinced “that present indeterminate status of the date for withdrawal of Allied Troops from area assigned to the Russians is certain to be misunderstood by Russia as well as at home.”

Hopkins stressed the fact that Allied control machinery could not be started until Allied troops had withdrawn from territory included in the Russian area of occupation and that any delay in the establishment of control machinery would interfere seriously with the development of governmental administrative machinery for Germany. Hopkins suggested that “as a concurrent condition to our withdrawal we should specify a simultaneous movement of our troops to Berlin under an agreement between the respective commanders which would provide us unrestricted access to our Berlin area from Bremen and Frankfurt by air, rail and highway on agreed routes.”

I informed Churchill of my decision to withdraw American troops from the Russian zone beginning June 21.

“In consideration of the tripartite agreement,” I cabled him, “as to zones of occupation in Germany, approved by President Roosevelt after long consideration and detailed discussion with you, I am unable to delay the withdrawal of American troops from the Soviet zone in order to use pressure in the settlement of other problems.

“Advice of the highest reliability is received that the Allied Control Council cannot begin to function until Allied troops withdraw from the Russian Zone.

“I am also convinced that the Military Government now exercised by the Allied Supreme Commander should, without delay, be terminated and divided between Eisenhower and Montgomery, each to function in the zone occupied by his own troops.

“I am advised that it would be highly disadvantageous to our relations with the Soviet to postpone action in this matter until our meeting in July.

“I therefore propose to send the following message to Stalin:

“QUOTE. Now that the unconditional defeat of Germany has been announced and the Control Council for Germany has had its first meeting, I propose that we should at once issue definite instruction which will get forces into their respective zones and will initiate orderly administration of the defeated territory. As to Germany, I am ready to have instructions issued to all American troops to begin withdrawal into their own zone on 21 June in accordance with arrangements between the respective commanders, including in these arrangements simultaneous movement of the national garrisons into Greater Berlin and provision of free access by air, road, and rail from Frankfurt and Bremen to Berlin for U.S. forces.

“As to Austria, it seems that arrangements can be completed more quickly and satisfactorily by making our commanders on the spot responsible for determining the definition of zones both in Austria itself and in the Vienna area and the readjustment of forces, referring to their respective governments only those matters that they are unable to resolve between themselves. I consider the settlement of the Austrian problem as of equal urgency to the German matter.

“If you agree with the foregoing, I propose that appropriate instructions be issued at once to our respective commanders. UNQUOTE.”

Churchill’s reply arrived on June 14. In it he said that “obviously we are obliged to conform to your decision,” and that the necessary instructions would be issued.

Churchill added:

“It is not correct to state that the tripartite agreement about zones of occupation in Germany was the subject of ‘long consideration and detailed discussion’ between me and President Roosevelt. References made to them at OCTAGON were brief and concerned only the Anglo-American arrangements which the President did not wish to raise by correspondence beforehand. These were remitted to the Combined Chiefs of Staff and were certainly acceptable to them.”

Churchill suggested a change in the wording of the next to the last paragraph of my message to Marshal Stalin, and offered the following version:

“I consider the settlement of the Austrian problem is of equal urgency to the German matter. The redistribution of forces into occupation zones which have been agreed in principle by the EAC [European Advisory Commission], the movement of the national garrisons into Vienna, and the establishment of the Allied Commission for Austria should take place simultaneously with these developments in Germany. I therefore attach the utmost importance to settling the outstanding Austrian problems, in order that the whole arrangement of German and Austrian affairs can be put into operation simultaneously. I hope that the recent visit of American, British, and French missions to Vienna will result in the EAC being able to take the necessary remaining decisions to this end without delay.”

He said he attached particular importance to having the Russians evacuate that part of the British zone in Austria which they were then holding at the same time that the British and American forces pulled back from the Russian zone in Germany.

Churchill added, “I sincerely hope that your action will in the long run make for a lasting peace in Europe.”

I accepted in full Churchill’s suggested changes to my proposed message to Stalin and sent it the same day. Churchill advised me the following day that he had sent a message to Stalin endorsing my views and advising him that the British government would also order withdrawal from the Russian zone on June 21.

In spite of previous Russian pressure for our quick evacuation from the Russian zone, Stalin suddenly and surprisingly proposed a slight postponement. The Russian Premier preferred an even later date than the one I had suggested. Stalin had a parade on his mind.

“I have received your message,” his cable read, “regarding the expediting of removal of Allied troops into appropriate zones in Germany and Austria.

“To my regret I have to say that your proposal to begin the removal of American troops into their zone and the entry of American troops into Berlin on June 21 meets with certain difficulties as, beginning with June 19, Marshal Zhukov and all of our other troop commanders are invited to Moscow to the session of the Supreme Soviet as well as for the organization of a parade and for the participation in the parade on June 24. Not mentioning the fact that not all the districts of Berlin have been cleared of mines and that this clearing cannot be finished before the end of June. As Marshal Zhukov and other commanders of Soviet troops are not able to return from Moscow to Germany before June 28th-30th, I would like to request that the removal of the troops begin on July 1 when the commanders will be back and the clearing of the mines completed.

“As regards Austria - the above-stated in respect to the summons of Soviet commanders to Moscow and the date of their return to Vienna applies to them, as well. Besides it is necessary that in the nearest future the European Consultative Commission complete its work on the establishment of zones of occupation of Austria and Vienna as this work has not been completed up to the present time. In view of the stated circumstances the allocation of appropriate troops to their zones in Austria should also be postponed until July 1.

“Besides, in respect to Germany as well as to Austria, it would be necessary, right now, to determine the zones of occupation by the French troops.

“On our part all necessary measures will be taken in Germany and Austria in accordance with the above-stated plan.”

On June 18, I replied to Stalin:

“I have issued instructions to the American commanders to begin the movement on July 1 as requested by you. It is assumed that American troops will be in Berlin at an earlier date in sufficient number to accomplish their duties in preparation for our conference.”

I then directed General Marshall to instruct the American commander to begin the evacuation movement on July 1 and for his information sent him copies of the messages exchanged between Stalin and myself.

With the date for evacuation set for July 1, the movement of our troops and the final details were now matters for the commanding general to carry out.

The agreement among Roosevelt, Churchill, and Stalin on how they would handle Germany was being kept. My intention was always to carry out to the letter all agreements entered into by Roosevelt with our allies. The main purpose was to set up a joint government of Germany consisting of the three powers and France.

My aim was a unified Germany with a centralized government in Berlin. In the case of Austria, I hoped for a unified country with its own government in Vienna. It was my own opinion that it would be silly if these arrangements were to lead to an isolated Berlin and Vienna to which we would have no access. I asked Stalin, with Churchill’s backing, in my cable of June 14, for free access by air, road, and rail to Berlin and to Vienna as part of the withdrawal of troops previously agreed to by Roosevelt, Churchill, and Stalin.

At my forthcoming meeting with Churchill and Stalin, I intended to call for the setting up of a centralized Allied-controlled government. I was opposed to the breaking up of Germany into several Allied segments. It was our plan that transportation, communications, and finance would be administered on a national basis for all of Germany under Allied control. At no time did I believe that Germany should be split into several rival territorial divisions or that its capital should become an island shut off from the rest of the country.

On June 25, General Marshall advised General Eisenhower of our thinking about access rights to Berlin. General McNarney and General Deane, who was head of the military mission to Russia, were also advised.

“It will be noted,” Marshall cabled them, “that the proposed . . . directive . . . contains no action to obtain transit rights to Berlin and Vienna on a combined basis. In accordance with the President’s message to Stalin . . . these should be arranged with Russian commanders concerned simultaneously with arrangements for other adjustments, by Eisenhower for Berlin and Clark for Vienna. It is assumed that appropriate Russian commanders have been instructed accordingly . . . and it is desired that Deane confirm this with the Soviet staff.”

On the following day, Deane cabled:

“This afternoon attempted to get confirmation that Soviet commanders have been instructed regarding free access to Berlin and Vienna, as directed in . . . While Lt. General Slavin was unable to give me an immediate reply, from the way he talked I do not anticipate there will be any difficulty in the matter. I will inform you immediately upon receipt of an official reply.”

On June 25, General Deane advised Marshall, Eisenhower, and McNarney by cable from Moscow:

“I have requested General Antonov by letter to confirm fact that Soviet Commanders have been authorized to agree with American Commanders on freedom of access by road, rail and air to Berlin and Vienna as directed in your . . . of 25 June. Will meet with either Antonov or his representative today and hope to get an answer at that time.”

On June 27, Deane reported that Marshal Zhukov had been empowered to negotiate for the Russians with General Clay, deputy to General Eisenhower.

General Deane informed Marshall in a cable on June 28, “It is my opinion that when our representatives meet with Zhukov there will be little difficulty in arranging for free access for our troops to Berlin, and that, if I am correct in this, the same principle will apply to Vienna . . .

The Soviet agreed to provide unrestricted use by the Allies of the standard-gauge railroad from Goslar to Berlin via Magdeburg. The Allies were also given the use of the Hanau-Magdeburg-Berlin autobahn but were refused free use of the Berlin-Frankfurt autobahn. The Allies were to have an air lane some twenty miles wide from Berlin to Magdeburg and two lanes from Magdeburg to Frankfurt.

With the redistribution of forces into the occupation areas, clearing the way to establish Allied control over Germany, we could now consider the principles by which we would deal with the defeated enemy.

There had been considerable discussion in this country about whether we should make a “hard” or a “soft” peace with Germany. Most of us agreed that Germany should be deprived of the capacity ever to commit aggression again, and in that sense we wanted the peace to be “hard.” At the same time, we remembered that after 1919, Germany was so enfeebled that only American money made it possible to pay the reparations that had been imposed.

The subject of reparations was, of course, one of the most critical aspects of this entire question. At Yalta, it became apparent that the Russians did not share the views that we and the British held with regard to reparations. At the Yalta conference, the Soviets had asked that a flat $20 billion be extracted from the German economy to compensate the nations on the Allied side for their losses, and that 50 percent of this amount be allocated to the U.S.S.R.

Neither the United States nor Great Britain had been willing to fix a monetary value or to agree to this Russian formula for allocation. In the end, it was agreed that the entire problem of “compensation for damages,” as President Roosevelt preferred to call it, would be referred to an Allied commission on reparations. This group was to meet in Moscow in time to prepare proposals for the next meeting of the heads of state.

To lay the groundwork for American participation in the work of this commission, an interdepartmental committee, under Assistant Secretary of State Will Clayton, had been at work since February. Dr. Isador Lubin had been designated as our representative on the Allied Reparations Commission, and he had begun to assemble a small staff. Their planning was well under way.

Lubin was an able public servant of high intelligence. But in the light of the difficulties that had arisen with the Soviets over the application of the Yalta agreement on Poland, I felt that the position required a tough bargainer, someone who could be as tough as Molotov. For this reason I asked Edwin W. Pauley to become my personal representative in reparations matters, while Dr. Lubin agreed to assist him as associate representative of the United States on the Allied Commission.

Pauley was prepared for the job, not only by reason of a long career in business, but as a student of economics, and he understood my attitude on the reparations question.

I was deeply concerned that the peace to be written should not carry within it the kind of self-defeating provisions that would enable another Hitler to rise to power. I wanted to work out a peace settlement that would be lasting.

It was already becoming apparent that we would be called upon to give aid, on a large scale, to many of the war-devastated areas. Judge Rosenman had just returned from an extensive inspection of the economic and, especially, the food situation in western Europe. His comprehensive report to me made it plain that help was badly needed and that it would have to come from us.

In England, France, Belgium, and Norway the prospects appeared equally bleak. Food supplies were critical; on the continent the return of acreage to agricultural use was hindered by the widespread presence of mines and explosives in the fields; everywhere fuel, transportation, and industrial plants were far below minimum needs. Added to this was the presence on the continent of several million persons displaced by the war, and in England and on the continent alike an alarming lack of shelter.

As our armies had advanced into Germany, it had become evident that the situation there was desperate. It seemed unlikely that much could be extracted from Germany beyond war machinery proper without reducing the country to the reliever’s role. Germany would have to be fed, and I was determined to see that it would not once again be charity altogether from us that fed her.

These considerations were reflected in the instructions Pauley was given. This document had been worked out by Clayton’s committee, and I approved it on May 18.

“It is and has been fundamental United States policy,” it read in part, “that Germany’s war potential be destroyed, and its resurgence as far as possible prevented, by removal or destruction of German plants, equipment and other property.” But we also instructed our delegation to oppose “any reparations plan based on the assumption that the United States or any other country will finance directly or indirectly any reconstruction in Germany or reparation by Germany.”

Since the Soviets would be occupying Eastern Germany, the source of most of Germany’s food, while we and the British would hold the area in which most of the industrial strength was to be found, we instructed Pauley to see that the burden of reparations would, as far as possible, be divided equally among the several zones of occupation. Our delegation was further directed to press for the principle that, to the maximum extent possible, reparations should be taken from the national wealth of Germany existing at the time of the collapse, with primary emphasis upon removal of industrial machinery, equipment, and plants. The German people were to be deprived of the ability to make war but should be left with sufficient means to provide a minimum subsistence level without sustained outside (which could only mean American) relief.

But if there were to be continuing reparations from current production, we would insist that the “first charge” principle be observed. That is, we wanted those exports that were necessary to maintain minimum production to be charged against the imports necessary to feed the country before anything went for reparations.

Pauley was also directed to seek agreement on the scope of war booty, reimbursement for occupation costs, and restitution. Since the definition of these terms would have an important effect on the amount of materials available for reparations purposes, agreement on these points was essential.

The food situation in Europe gave me increasing cause for concern.

The Department of Agriculture’s experts came up with an estimate that continental Europe alone, not including the British Isles, would need 12 million tons of food during the next year to prevent large-scale starvation. Production for 1946, they calculated, would be five to 10 percent below that for 1945, the lowest since prewar days. Our own farm yields were less promising for this year than they had been since the war began. I thought it might be desirable and useful to consult with former President Herbert Hoover on this situation. I invited him to visit with me and give me the benefit of his rich experience in the field of food relief. When he came, I had a most pleasant and satisfactory meeting with him. He helped me to review the world food-distribution problem, which he knew from one end to the other. The former President was pleased to be able to make a personal contribution to the settlement of the aftermath of the war.

Meanwhile, the Pauley mission had proceeded to Moscow for the meetings of the Allied Reparations Commission. Pauley had assembled a notable group of men. It was a bi-partisan group, including President Robert Gordon Sproul of the University of California, Dr. Luther Gulick, and a number of experts drawn from business and government.

Pauley arrived in Moscow as the Moscow radio broadcast a sharp attack on “U.S. industrialists who are doing their utmost to restore German heavy industry.” It was not until June 21 that the Commission met. After our delegation had presented a statement of eight principles embodying our position, the Soviet representative presented the plan of his government. This called for withdrawals to be made from the existing national wealth of Germany for two years. Thereafter, annual deliveries from current production would continue over a ten-year period and, in addition, there would be wide utilization of German labor. Furthermore, there would be a fixed sum total for all reparations in the amount of $20 billion, exclusive of labor. The Russians proposed that the Commission proceed first to plan for the withdrawal of national wealth and then pass to the other items on the Soviet agenda. Our delegation asked for data that would support the $20-billion figure, a request that had originally been made at Yalta, but none was forthcoming. In fact, the Russians, unwilling to make any concessions, prevented, by delaying tactics, any further meetings of the full Commission.

The Steering Committee of the Commission decided on a compromise for the allocation of shares from the total of reparations. The Russians had proposed that they receive 50 percent, the United States and the United Kingdom together 40 percent, and all the other nations 10 percent. The British were interested in having their claim spelled out separately, and we made the point that the claims of nations not represented in the Commission should not be prejudged. The compromise provided for a ratio of 56-22-22 among the three powers present and deferred until later the determination of what other nations were to get. Then, whatever would go to the other nations would be prorated against the three major powers on the same basis of 56-22-22.

Pauley’s discussions in Moscow, on which he kept me constantly advised, took place while there were increasing reports that wholesale removals of plants and equipment were under way in the Soviet zone of Germany. The Russians chose to interpret the words “war booty” in a manner that included any plant or equipment ever used to supply the armed forces of the defeated enemy. Under modern war conditions that made the definition nearly all-inclusive.

Meanwhile at Moscow, any attempt to agree on a definition was frustrated by Russian refusal to consider anything until the plan for the initial withdrawal from national wealth had been worked out. When we thought of withdrawals from the national wealth of Germany, we naturally thought of a Germany of pre-World War II dimensions. With this in mind we had asked, and had received, Russian agreement to the basic proposition that, for purposes of reparations, Germany would be treated as an economic whole. Even while this principle was being agreed to at Moscow, however, a sizeable portion of German territory had been placed under the administration of Poland and had thus been withdrawn from the area from which reparations might be taken. Since this portion of Germany, along with the zone occupied by the Russians, had contributed the bulk of prewar Germany’s food supply, the effect this change would have on the German economy was bound to be drastic. Nor could the worsening economic condition of all Europe be separated from our thinking on reparations. Germany was as thoroughly devastated as any part of Europe, but millions of persons displaced by the war aggravated the problems.

Joseph C. Grew, Acting Secretary of State, reported to me in June that the State Department, at the suggestion of Secretary Morgenthau, was planning to send Earl G. Harrison, a former immigration commissioner and dean of the University of Pennsylvania Law School, to Europe to look into the problems and needs of displaced persons, especially those who were considered “non-repatriable.” Grew told me that the majority of the displaced persons were being returned by the military authorities in Europe to their respective countries. There remained, however, the Jewish survivors of Nazi persecution and such other groups as Poles and nationals of the Baltic states whose return was being delayed by political reasons.

I approved of the proposed mission and on June 22 wrote directly to Harrison. I told him that it was important to the early restoration of peace and order in Europe that plans be developed to meet the needs of those who, for justifiable reasons, could not return to their countries of former residence.

It became apparent, because of Russian non-cooperation, that each occupying power would have to look to its own zone for reparations claims.

Pauley was to join the staff at Potsdam, both as my representative for reparations and as economic adviser. The progress report Pauley submitted to me before the Potsdam discussions began was a well-prepared document. It was a clear analysis of the Moscow talks and stated the issues that had to be resolved. One of these was the basic difference in attitude between us and the Russians on the question of forced labor. At the suggestion of Justice Jackson, our chief counsel for the war crimes trials, instructions to Pauley affirmed our refusal to accept any reparations for ourselves in the form of labor. In addition, we took the position that compulsory labor should not be imposed by any of the victors except upon individuals judicially convicted as war criminals.

I had held a number of conferences with Justice Jackson and Judge Rosenman in order to set the keynote for our policy on the legal questions of our dealings with Germany.

On June 6 Justice Jackson sent me a progress report. This report expressed decisions and opinions previously considered in conferences I had had with Justice Jackson. This report set the keynote for our policy:

“Fair hearings for the accused are, of course, required to make sure that we punish only the right men for the right reasons.

“But the procedure of these hearings may properly bar obstructive and dilatory tactics resorted to by defendants in our ordinary criminal trials.

“Nor should such a defense be recognized as the obsolete doctrine that a head of state is immune from legal liability. There is more than a suspicion that this idea is a relic of the doctrine of the divine right of kings.

“It is, in any event, inconsistent with the position we take toward our own officials, who are frequently brought to court at the suit of citizens who allege their rights to have been invaded.

“We do not accept the paradox that legal responsibility should be the least where power is the greatest.

“We stand on the principle of responsible government declared some three centuries ago to King James by Lord Chief Justice Coke, who proclaimed that even a King is still ‘under God and the law.’ . . .

“Whom will we accuse and put to their defense? We will accuse a large number of individuals and officials who were in authority in the government, in the military establishment, including the General Staff, and in the financial, industrial and economic life of Germany who by all civilized standards are provable to be common criminals.

“We also propose to establish the criminal character of several voluntary organizations which have played a cruel and controlling part in subjugating first the German people and then their neighbors.

“It is not, of course, suggested that a person should be judged a criminal merely because he voted for certain candidates or maintained political affiliations in the sense that we in America support political parties. The organizations which we will accuse have no resemblance to our political parties.

“Organizations such as the Gestapo and the S.S. were direct action units, and were recruited from volunteers accepted only because of aptitude for, and fanatical devotion to, their violent purposes. . . .

“Our case against the major defendants is concerned with the Nazi master plan, not with individual barbarities and perversions which occurred independently of any central plan.

“The groundwork of our case must be factually authentic and constitute a well-documented history of what we are convinced was a grand, concerted pattern to incite and commit the aggressions and barbarities which have shocked the world.

“We must not forget that when the Nazi plans were boldly proclaimed, they were so extravagant that the world refused to take them seriously.

“Unless we write the record of this movement with clarity and precision, we cannot blame the future if in days of peace it finds incredible the accusatory generalities uttered during the war. We must establish incredible events by credible evidence. . . .

“Those acts which offended the conscience of our people were criminal by standards generally accepted in all civilized countries, and I believe that we may proceed to punish those responsible in full accord with both our own traditions of fairness and with standards of just conduct which have been internationally accepted.

“I think also that through these trials we should be able to establish that a process of retribution by law awaits those who in the future similarly attack civilization. . . .

“Our people have been waiting for these trials in the spirit of Woodrow Wilson, who hoped to ‘give to international law the kind of vitality which it can only have if it is a real expression of our moral judgment.’ . . .”

Jackson concluded: “May I add that your personal encouragement and support have been a source of strength and inspiration to every member of my staff, as well as to me, as we go forward with a task so immense that it can never be done completely or perfectly, but which we hope to do acceptably.”