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increase of US dollar expenditures for the government of Germany, or a delay in the attainment of a self-supporting German economy at an appropriate standard of living, funds for German expenditures shall be increased, or the German economy compensated through provision by the US of sufficient relief monies to the country or countries so benefited to enable them to pay Germany. You will consult other European countries and international organizations representing such countries in matters of German production and trade mentioned above, and ensure that emphasis is given, in the selection of items for export, to goods needed by European countries for their economic recovery and rehabilitation insofar as these countries may provide in payment needed imports for Germany, or foreign exchange which can pay for such imports. Proposed transactions of a substantial nature which would lead to a restoration of general European trade or normal international commercial relations or restore normal trade exchanges between Germany and other European countries but which would not conform to the principles stated in this paragraph should be referred to the US Govt for decision.

d. You will support the removal of existing trade barriers and will encourage the return of foreign trade to normal trade channels. 19. Finance

a. Your government views the reorganization of German finances on a sound basis and the attainment of financial stability in Germany as among the main factors essential to German economic recovery along democratic and peaceful lines. To that end, you will endeavor to have the Control Council adopt uniform financial policies in conformity with the principles and the objectives set forth in this directive.

b. Pending agreement in the Control Council, or until receipt of further directive from your government, you will continue to be guided by the following policies in your zone:

(1) you will control, within the scope of your authority, all financial transactions of an international character in order to keep Nazi influence out of the field of finance and prevent outward movements of capital from Germany;

(2) you will exercise general supervision over German public expenditures and measures of taxation in order to insure that they are consistent with the objectives of the Military Government;

(3) you will take such action as may be necessary to prevent the establishment of a centralized German banking system and an undue concentration of financial power, but will encourage the establishment of a central authority for the production, issuance and control of currency and for technical banking supervision. You will also encourage the Germans to reestablish normal banking facilities within the limitation prescribed above and within the present blocking of assets and accounts under Military Government Law No. 52;

(4) you will use the resources of the German economy to the maximum extent possible in order to reduce expenditures from appropriated funds of your government. You are authorized, as provided in the Potsdam Agreement, to use the proceeds of exports to pay for imports which you deem essential, subject to strict accounting and auditing procedures;

(5) you will continue to aid economic recovery by collection of full payment for exports of German goods and services; and

(6) you will continue to prevent non-essential imports. c. You will press for the adoption by the Control Council of a program for financial reform which provides for a substantial and appropriate reduction in outstanding currency and monetary claims, including public and private debt; for the equitable sharing of the costs of war and defeat; and for ancillary measures including adjustments in the wage-price structure necessary to the restoration of balance between the financial structure and the economic realities.

d. (1) You will maintain such accounts and records as may be necessary to reflect the financial operations of the Military Government (U. S.) in Germany, including also such operations undertaken jointly by you with the Military Government in the British and other zones of occupation in Germany.

(2) You will take measures necessary for calculating occupation costs distinguishing those now incurred within Germany and supported by the German economy, and external occupation costs for eventual settlement with Germany. You will endeavor to agree on a definition of occupation costs of both types within the Control Council and to limit and control internal occupation costs on a quadripartite basis. 20. Agriculture

a. In accordance with the decision of 23 April 1947 of the Council of Foreign Ministers, you will ensure the carrying out and completion of land reform in your zone in 1947.

b. You will require the appropriate German authorities to adopt and implement policies and practices which will:

Maximize the production and provide for the effective collection and distribution of agricultural products.

c. You will require the appropriate German authorities to adopt and implement similar policies and practices in respect to forestry and fishing resources.

21. Economic Institutions

a. Pending agreement among the occupying powers you will in your zone prohibit all cartels and cartel-like organizations, and effect a dispersion of ownership and control of German industry through the dissolution of such combines, mergers, holding companies and interlocking directorates which represent an actual or potential restraint of trade or may dominate or substantially influence the policies of governmental agencies. You will not, however, prohibit governmental regulation of prices or monopolies subject to government regulation, in fields where competition is impracticable. In so far as possible, you will coordinate your action in this field with the commanders of other zones of occupation.

b. You will permit the formation and functioning of cooperatives provided they are voluntary in membership, and are organized along democratic lines and do not engage in activities prohibited under the above paragraph.

c. While it is your duty to give the German people an opportunity to learn of the principles and advantages of free enterprise, you will refrain from interfering in the question of public ownership of enter

prises in Germany, except to ensure that any choice for or against public ownership is made freely through the normal processes of democratic government. No measure of public ownership shall apply to foreign-owned property unless arrangements which are satisfactory to your Government have been made for the compensation of foreign owners. Pending ultimate decision as to the form and powers of the central German Government, you will permit no public ownership measure which would reserve that ownership to such central govern

ment.

d. Pending agreement among the occupying powers, you will limit new foreign investment in your zone of Germany and will continue to ensure that all property, however owned, and all production and manpower in your zone are subject in all respects to the decisions and directives of the Control Council, and to Military Government and German law.

e. (1) You will permit the organization, operation, and free development of trade unions provided that their leaders are responsible to the membership and their aims and practices accord with democratic principles. Any federation of trade unions shall not impair the financial and organizational autonomy of member unions. You will encourage the trade unions to support programs of adult education and to foster an understanding of democratic processes among their members. You will permit trade unions to act in the interests of their members and to bargain collectively regarding wages, hours and working conditions within the framework of such wage and price controls as it may be necessary to maintain.

(2) Trade unions may represent the occupational, economic and social interests of their members in accordance with the authority contained in their constitutions. Their basic functions may include participation with appropriate authorities in the establishment and development of a peaceful economy.

f. You will permit the organization and functioning of work councils on a democratic basis for the representation of the interests of employees in individual enterprises and will not prohibit the cooperation of trade unions therewith.

g. You will also permit the establishment of machinery for the voluntary settlement of industrial disputes.

22. Cultural Objectives

VI

Your Government holds that the reeducation of the German people is an integral part of policies intended to help develop a democratic form of government and to restore a stable and peaceful economy; it believes that there should be no forcible break in the cultural unity of Germany, but recognizes the spiritual value of the regional traditions of Germany and wishes to foster them; it is convinced that the manner and purposes of the reconstruction of the national German culture have a vital significance for the future of Germany.

It is, therefore, of the highest importance that you make every effort to secure maximum coordination between the occupying powers of cultural objectives designed to serve the cause of peace. You will encourage German initiative and responsible participation in this work of cultural reconstruction and you will expedite the establishment of these international cultural relations which will overcome the spiritual

isolation imposed by National Socialism on Germany and further the assimilation of the German people into the world community of

nations.

23. Education

a. In recognition of the fact that evil consequences to all free men flow from the suppression and corruption of truth and that education is a primary means of creating a democratic and peaceful Germany, you will continue to encourage and assist in the development of educational methods, institutions, programs and materials designed to further the creation of democratic attitudes and practices through education. You will require the German Laender authorities to adopt and execute educational programs designed to develop a healthy, democratic educational system which will offer equal opportunity to all according to their qualifications.

b. You will continue to effect the complete elimination of all National Socialist, militaristic and aggressively nationalistic influences, practices and teachings from the German educational system. 24. Religious Affairs

a. You will, in the United States Area of Occupation, continue to assure freedom of religion. You will assure protection of religious activity and support these principles in the deliberations of the Control Council.

b. You will give freedom to the Germans to decide all questions concerning the constitution, the religious activity and the amalgamation of purely ecclesiastical bodies.

c. You will continue to take such action as may be necessary to prevent the revival of National Socialist and militaristic activity under the cloak of a religious program or organization.

25. Monuments, Fine Arts, and Archives

a. You will respect, and permit German authorities to protect and preserve, the property of all cultural institutions dedicated to religion, charity, education, the arts and sciences, historic monuments and historic archives, together with their collections and endowments. You will apply the same principle to all other property of cultural value, whether publicly or privately owned, except for institutions and monuments specifically devoted to the perpetuation of National Socialism or to the glorification of the German militaristic tradition. b. You are authorized to make such use of German records and archives as may be appropriate.

26. Public Information

a. You will, in the United States Area of Occupation, supervise, encourage and assist in the development by the Germans of media of public information designed to advance the political and cultural objectives stated in this directive.

b. You will arrange through the Allied Control Council for the implementation of the decision of 23 April 1947 of the Council of Foreign Ministers on the free exchange of information and democratic ideas by all media in all of Germany.

c. You will develop and maintain organizations and facilities for the operation of media of information, including those sponsored by

Military Government, designed to further the objectives of your Government.

27. Reestablishment of International Cultural Relations

In furtherance of the program of the reorientation of the German people and the revival of international cultural relations, you will permit and assist the travel into and out of Germany of persons useful for this program within the availability of your facilities. You will also permit and assist, to the extent of your facilities, the free flow of cultural materials to and from Germany.

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94. LEVEL-OF-INDUSTRY TALKS, AUGUST 22-27, 1947 1 (a) Communiqué Issued Jointly by the United States, the United Kingdom, and France, August 28, 1947

1. Tripartite talks between representatives of the French, United Kingdom and United States Governments relating to the level of industry in the combined Anglo-American zones of Germany and to the management and control of mines in the Ruhr took place in London between the 22nd and 27th August 1947. They have enabled the United Kingdom and United States Delegations to explain their governments' plans and the French Delegation to set forth the views of the French Government concerning these problems. The three delegations were able, as a result of the conversations, to arrive at a more complete understanding of their respective points of view.

2. The three delegations agreed that the measures about to be taken should not result in priority being given to the rehabilitation of Germany over that of the democratic countries of Europe. They consider it necessary that German resources should contribute to the general rehabilitation of Europe.

3. The three delegations recognize that disarmament, demilitarization and democratization of Germany remain indispensable to security and that the plans envisaged for the Anglo-American zones do not prejudice such guarantees in this respect as may be established in the future.

4. In particular, the United Kingdom and United States Delegations explained that the plan for the management and control of the Ruhr mines which had been communicated to the French Delegation does not prejudge the future status of these mines, and that it would not constitute an obstacle to the adoption of such measures as might be judged necessary to prevent the Kuhr from again becoming an instrument of aggression, or to the adoption of such measures as might be established to assure to other countries access to its products. The French Delegation took note of these explanations and reserved the position of its government with regard to the arrangements for the management and control of the mines.

5. The French Delegation set forth the main reservations it wished to make relating to certain figures in the United Kingdom-United States level-of-industry plan, particularly as regards machine tools

Released to the press simultaneously in Washington, London, and Paris on August 28, 1947. Printed from telegraphic text. Department of State Bulletin, September 7, 1947, pp. 467–472.

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