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It was decided that the three western zones would
be unified as a federal republic with a democratic
government until such time as a way could be
found to bring the eastern zone into the federation.
At the same time, to provide security for western
Europe, an International Authority was proposed
for the Ruhr, industrial heart of Germany, in
which the Western Powers, Benelux countries and
Federal Republic would participate.

As the first step, a drastic curren,cy reform was
effected in the three western zones in June 1948,
which gave the economy a tremendous lift toward
recovery. This resulted in the blockade of Berlin
by the Soviets and the Allied counter-blockade of
eastern Germany. While the Anglo-American
airlift was defeating Russian efforts to freeze the
Western Powers out of Berlin, the western Ger-
man states convened a constitutional assembly in
Bonn. The "Basic Law" or constitution for the
federation was drafted during the course of six
months and ratified by the German states in the
summer of 1949. In August democratic elections
were held and on Sept. 21 the government of the
Federal Republic of Germany was installed.

On the same date Military Government was
ended, the Allied High Commission was activated,
and the Occuiiation Statute came into force. De-
veloped by the three Western Powers while the
federal constitution was being drafted, the Occu-
pation Statute became the basic charter for Allied
operations in Germany, defining the powers of the
Occupation Authorities vis-a-vis those of the fed-
eral government. It gi'anted the Germans more
independence and responsibility for their own
affairs than they had had since the end of the war.

Basically, the statute allows the federal govern-
ment full authority over all domestic affairs, with
a few exceptions in so-called reserved fields, pri-



marily with respect to disarmament, reparations,
decartelization and respect for the Basic Law and
state constitutions. The Occupation Powers re-
tain the authority to supervise western German
foreign relations, foreign trade and internal eco-
nomic activities to the extent necessary to assure,
the best utilization of German resources with a
minimum of external assistance.

The High Commission also has the right to dis-
approve federal or state legislation within 21 days
after its transmittal to the Occupation Authorities,
and to intervene if necessary to preserve security
or democratic government or in pursuance of in-
ternational obligations.

To implement the Occupation Statute, the Allied
High Commission is organized to provide for uni-
form Allied pplicy in all three zones of western
Germany. At its head is the Coimcil, comprised
of the three High Commissioners or, in their ab-
sence, their deputies, Maj. Gen. George P. Hays
(U. S.), Christopher E. Steel (British) and Ar-
mand Berard (French).

The High Commissioners and their deputies
have a rich and varied background in government,
diplomacy and German affairs. United States
High Commissioner McCloy was assigned to im-
cover German responsibility for the famous "Black
Tom" explosion during World War I, becoming
an authority on German espionage and sabotage-
Having served as assistant secretary of war, he
came to his position in Germany from the presi-
dency of the World Bank.

General Robertson, Britain's high commissioner,
had served as British military governor for Ger-
many for two years prior to his present appoint-
ment.

A career diplomat, Mr. Frangois-Poncet had
been France's ambassador to Germany before the
war, now serves as France's highest authority on
the High Commission.

From command of the wartime 10th Mountain
Division which fought its way up through Ital}',
General Hays assumed in 1947 the job of deputy
military governor under Gen. Lucius D. Clay, and
now serves as Deputy United States High Com-
missioner. His British counterpart, Christopher
Steel, brings with him a background as British
political adviser to SHAEF in 1945, and as polit-
ical adviser to the British Military Government
in 1947. French Deputy High Commissioner
Berard is, like his chief, a long-time diplomat who



548



Department of State Bulletin



had five years' service in Berlin during the early
1930's.

■ Beneath the Council are nine permanent tri-
partite commissionei"s in the respective fields.

The deputies sit as the General Committee to
consider procedural and administrative business
of the High Commission and to deal with matters
not falling specifically to the other committees. In
some instances, the General Conmiittee, rather than
the Council, is asked to resolve disagi'eements aris-
ing in the other conunittees.

The Political Affairs Committee, consisting of
the three political advisers, is concerned with all
political and foreign affaii-s of the German federal
and state governments coming witliin the com-
petence of the Council.

A Foreign Trade and Exchange Committee,
comprised of the economic and finance advisers,
guides the foreign trade policies of the German
authorities.

The committee members are automatically di-
rectors of the Joint Export-Import Agency until
its liquidation.

The Economics Committee, comprised of the
economic advisers, observes German economic pol-
icies and advises the Council in exercising its re-
served powers in this field, including decarteliza-
tion and deconcentration of German industry.

The three finance advisers form the Finance
Committee, which observes German financial pol-
icies and advises the Council in exercising its pow-
ers under the Occupation Statute in this field.

The Law Committee, comprised of the legal
advisers, provides the Coimcil and its committees
with advice on legal and judicial affairs arising
out of the work of the High Commission.

A Special Committee for the Review of German
Legislation (both federal and state) is comprised
of representatives of the legal and political staffs
of the high commissioners. This committee must
review all German legislation in sufficient time so
that final action can be taken within 21 days of its
receipt from the German authorities. If disap-
proval is recommended, the Council itself must
make the decision.

A ninth agency, the Military Security Board,
handles all maters of demilitarization, disarma-
ment, and prohibitions and limitations on industry
and scientific research. This agency, currently lo-
cated in Berlin, is scheduled to move to Coblenz
this spring.

The High Commission charter also provides for



the formation of subcommittees and subordinate
agencies, usually concerned with more specific
fields under the permanent committees.

Currently there are about 25 of these subordinate
agencies, such as the Coal and Steel Control
Groups which report through the Economics Com-
mittee, the Combined Travel Board and an Infor-
mation and Cultural Affairs Subcommittee under
the Political Committee, the Public Safety Sub-
committee, the Civil Aviation Board under the
General Committee, and so on.

Holding the key to smootli operation of the High
Commission is the Allied General Secretariat, a
three-power body which receives and dispatches
all couununications for the High Commission, pre-
pares agendas, keeps minutes, provides briefs and
background material to the members of the Coun-
cil and committees, and acts as the channel of
communications between the High Commission,
the German federal government, the state com-
missioners,- and all outside agencies.

The Secretariat consists of the three national
secretaries and their staffs. Joseph E. Slater, the
United States secretary, had previously served as
secretary of OMGUS' Economics Division and as-
sistant United States secretary with the Allied
Control Council in Berlin and also with the United
Nations planning staff. Leo Handley-Derry, the
British secretary, had been secretary of the Bi-
zonal Delegation to the Oeec in Paris. Lt. Col.
G. P. Glain, the French secretary, had been French
secretary with the Allied Control Council.

These three take turns discharging the duties of
secretary-general as the chairmanship of the Coun-
cil rotates monthly. Apart from their duties in
servicing tripartite meetings, their primary re-
sponsibility is to coordinate among themselves and
with their national elements every communication
issued in the name of the Allied High Commission.
This, of course, involves work in the French and
English languages on all papers and in German
as well on those received from or destined for
German agencies.

The Secretariat includes also a Liaison and
Protocol Section, an Allied Central Statistical Of-
fice and a tripartite archivist.

Most of the work of the High Commission is
referred first to the appropriate committee or sub-



' The official term is "Land Commissioners," but to avoid
confusion with the American word meaning Earth, the
German "Land" is translated in this article to "State."



April 10, 1950



549



committee for preliminary discussion. Often
these subordinate agencies reach complete agree-
ment and the decision is referred to the Council
only for formal review and official promulgation.
In less important matters the committee them-
selves may communicate their decisions directly
to the federal government or state commissioner
concerned.

In cases of disagreement on the committee level
the subject is passed on to the General Committee
or to the Council with a statement of the positions
of the three powers. Usually the high commis-
sioners, with their broader authority to modify
policy, arrive at agreement. The majority rule
applies on voting except that amendments to the
Basic Law must be approved by unanimous agree-
ment. A dissenting member of the Council may,
however, appeal a decision to liis government in
certain fields.

In addition to tlie formal Council meetings on
Thursdays, the high commissioners often convene
for informal sessions and also meet frequently
with the German chancellor. Committees and sub-
committees are usually in weekly session while the
United States, British and French heads of the
Secretariat confer at least daily and on many oc-
casions have several separate meetings daily to
direct the complicated operations of their
organization.

Thus some 200 American, British and French
officials are associated weekly in the conferences
and meetings necessary to exercising efficient and
continuous tripartite control of western Germany.
Members of the federal cabinet and other German
ex^oerts are consulted from time to time either for-
mally or informally.

Illustrative of the activity of the Allied High
Commission is the fact that 283 meetings took
place in the first three months, exclusive of Mili-
tary Security Board and Secretariat meetings.

In this manner the major Allied policies in
western Germany are established by the High
Commission and carried out uniformly through-
out the three occupation zones. The zones remain
important primarily as areas of responsibility of
the respective high commissioners and for the lo-
cation of occupation troops. Each high commis-
sioner is authorized under the Charter to take
unilateral action only in a few reserved fields, such
as : maintenance of law and order if German au-
thorities are unable to do so; protection of the
prestige and security of the Occupation Forces;



operation of Allied courts and care of prisoners
sentenced by them. Even in these fields, the high
commissioner is required to coordinate his policies
in so far as possible with those of the other high
commissioners.

Significantly, the High Commission charter
states that the High Commission will be repre-
sented in each state of the western zones by an
Allied state commissioner who shall be solely re-
sponsible to the Council for insuring due compli-
ance on the part of the German state authorities
with the Coimcil's decisions and directives. In
effect, this makes the state commissioner accounta-
ble to the Council for all tripartite matters in his
state, rather than resjionsible only to his own high
commissioner.

As a further quarantee of uniform tripartite op-
erations in the three zones, each high commissioner
is authorized to delegate state observers with small
staffs to state commissioners of the other two zones
for consultation and advice.

The first few months of Allied High Commis-
sion operations have been arduous and difficult. A
great amount of Military Government legislation
had to be reviewed and extended or dropped;
policies under the Occupation Statute had to be
defined ; new procedures, the authority and respon-
sibilities of the state commissioners, the transfer
of most JEIA functions to the federal government,
the establislunent of occupation costs budget and
a host of other problems incident to the develop-
ment of the new civilian control of Germany con-
fronted the Allied High Commission during its
first months.

In addition to the routine current activities
there were such important problems as the review
of federal and state legislation, the authorization
of the federal government to join international
organizations; the accreditation of foreign mis-
sions; consideration of numerous petitions from
the federal government on dismantling and other
questions, and so on.

Several particularly urgent problems have also
confronted the High Commission which required
night sessions and frequent contact with Washing-
ton, London and Paris for policy guidance. One
of those was the revaluation of the Deutsche mark,
and anotlier was the conduct of negotiations with
Dr. Konrad Adenauer, federal chancellor, in car-
rying out the foreign ministers' agi-eements in
Paris during November. Tlie latter subsequently
resulted in the Petersberg Protocol of Nov. 22.



550



Deparlment of State Bulletin



This agreement is a nianifestation of the new
spirit of occupation policies which is beginning to
be felt uniformly throughout the Feileral Republic.
The old emphasis on restriction and control is now
being relaxed and replaced by the positive policy
of aiding tJermany to earn a respected place among
the democratic nations.

In accordance with its pledge, the Federal Re-
jmblic lias now joined the International Authority
for the Ruhr. It has agreed to cooperate with the
Military Security Board, to liberalize the structure
of government and to guard against any revival of
totalitarianism. These security guaranties should
serve to calm European fears and give the high
commissioners greater latitude in aiding Ger-
maTiy's reconstruction and further extending the
authority of the federal government.

The Allies are to permit the re-establishment of
consular and commercial relations with other na-
tions, and plans are already proceeding for the
immediate establishment of such consulates in the
United States, the United Kingdom and France.

The participation of Germany in international
organizations through which she can contribute to
the general welfare are also to he promoted. Al-
ready within recent weeks the High Commission
has allowed Germany to join the Organization for
European Economic Cooperation (Oeec), the
European Customs Union Study Group, to attend
certain International Labor Organizations (Ilo)



conferences, and to consummate a bilateral agree-
ment on ECA aid with the United States govern-
ment. Negotiations are also going forward with
regard to membership in several other interna-
tional organizations.

Internally, most of the controls over press, poli-
tics, education, labor and economics have been re-
laxed. After a year the Occupation Statute will
be revised to determine what further authority may
be extended to the federal government.

When the high commissionei's meet in the lofty
Petersberg to render decisions and to issue instruc-
tions implementing the neve constructive policies,
they are not conducting an "ivory tower" opera-
tion. Through their field officers, state commis-
sions and headquarters staffs, tlie high commis-
sioners will observe the political and economic
progress of the Federal Republic during the com-
ing year. Western Germany must prove its al-
legiance to democratic principles and its sincerity
in contributing to the recovery of Europe.

From the windows of their offices on the second
floor of the Petersberg, the three Allied leaders can
look down on the broad reaches of the Rhine 1,000
feet below. In effect they have mounted a new
watch on the Rhine — a cautions but hopeful
watch — with the objective that no military invader
or foreign occupier will ever have to maintain vigil
here again.



THE CONGRESS



Legislation

International Wheat Agreement Act of 1949. H. Kept.
1395, 81st Cong., 1st sess. 8 pp.

Printing as a Document, a Manuscript Entitled "A
Decade of American Foreign Policy : Basic Documents,
1941-49," Relating to American International Relations.
H. Rept. 14.56, 81st Cong., 1st sess. 1 p.

Settlement of Certain Finnish Claims. H. Rept. 1457,
81st Cong., 1st sess. 20 pp.

Authorizing the Joint Committee on Atomic Energy To
Have Printed .")0,000 Copies of Senate Repart 1169. H.
Rept. 14C4. 81st Cong., 1st sess. 1 p.

S.vnthetic Rubber. Message from the President of the
United States transmitting synthetic rubber recommenda-
tions of the President, together with a report on main-
tenance of the synthetic rubber industry in the United
States and disposal of government-owned syntlietic rubber
facilities from the Assistant to the President. H. Doc. 448,
.Slst Cong.. 2d sess. iii, 121 pp.



Second Annual Report for the Philippine Alien Property
Administration. Message from the President of the United
States transmitting the .second annual report for the
Philippine Alien Property Administration for the fiscal year
ended June 30, 1948. H. Doc. 449, 81st Cong., 2d sess.
V, 69 pp.

Supplemental Estimates of Appropriation and Public
Debt Authorization for Various Agencies in the Executive
Branch and the District of Columbia. Communication
from the President of the United States transmitting . . .
H. Doc. 457, 81st Cong., 2d sess. 9 pp.

Contribution by the United States to the United Nations
Relief and Works Agency for Palestine Refugees in the
Near East. Communication from the President of the
United States transmitting . . . H. Doc. 459, 81st Cong.,
2d sess. 3 pp.

Report of the Air Coordinating Committee. Message
from the President of tlie United States transmitting the
annual report of the Air Coordinating Committee for the
calendar year 1949. H. Doc. 476, 81st Cong., 2d sess.
v, IS pp.

Estimate of .Appropriation, in Form of an Amendment
to the Budget, for Expenses of the European Recovery
Program. Communication from the President of the
United States transmitting estimate of appropriation for
the fiscal year 1951, in the amount of $2,950,000,000 . . .
H. Doc. 479, 81st Cong., 2d sess. 3 pp.

Suspension of Deportation of Certain Aliens. H. Rept.
1542, 81st Cong., 2d se.ss. [To Accompany S. Con. Res. 34]
2 pp.



April 10, 7950



551



Aid to Underdeveloped Areas As Measure of National Security



Statement hy Secretary Acheson ^



]Mr. Chairman, Members of the Committee:
I am glad to have this chance to discuss with you
the legislation entitled an "Act for International
Development."

Four Courses of Action

This proposed measure is the underlying legis-
lative authority for carrying out a progi-am to
assist tlie people of the underdeveloped areas of
the world in their efforts to develop their economic
resources. It is an integi'al part of a general pro-
gram outlined by the President as a basis for as-
suring peace and personal freedom in the world.
This program contained four interrelated courses
of action. The first course is the continuing of
our unfaltering support of the United Nations and
its related agencies. The second course is the con-
tinuing of our programs for world economic recov-
ery. The third is the strengthening of freedom-
loving nations against tlie dangers of aggi'ession
by providing military advice, and equipment to
those nations which will cooperate with us in the
maintenance of peace and security. The fourth
course of action is the program which you are now
considering. It involves making available to
peace-loving peoples the benefits of our technical
knowledge and skills. It also involves coopera-
tion with other free nations in fostering capital
investment in areas needing development. Its
aim is to help the free peoples of the world
through their own efforts to produce the things
they need for a decent life.

The legislation before you is the product of more
than a year of careful study in which 43 agencies
of the Federal Government have participated. It
is the product also of consultation with interested
members of the Congress and with leading mem-
bers of business and labor and scientific groups. I

' Made before the Senate Committee on Foreign Rela-
tions on the Point 4 legislation on Mar. 30, 1950, and re-
leased to the press on the same date.



would say that it represents the best combined
judgment of all who were concerned in shaping it.

As you know, this legislation does two things :
It establishes the objectives and the broad policy
to guide the whole program of American aid to
underdeveloped areas, and it authorizes the Presi-
dent to carry out that part of the program dealing
with technical cooperation.

As this Committee well knows, the activities px'o-
posed are not new. For many years Americans
have been sharing technical skills with other
peoples and investing their capital abroad. This
is part of the American experience. It is in the
American tradition.

Wliy, then, did the President propose to raise
these activities to the level of a national policy and
a great national enterprise? Why did he single
out this policy and this enterprise as one of the
four cardinal aims of American foreign policy?

Only by answering these questions can we, in
my opinion, appreciate the overriding importance
of the legislation that is before you.

Today, democracy is on trial for its life. The
free way of life is under attack in every part of
the world, including those areas of the world which
we call "underdeveloped."

These areas include parts of Latin America,
Africa, the Middle East, and the Far East where
two-thirds of the world's people live, many of them
in the shadow of hunger, poverty, and disease.

Increasing numbers of these peojile no longer
accept poverty as an inevitable fact of life. They
are becoming aware of the gap between their living
standards and those in the more highly developed
countries. They are looking for a way out of their
misery. They are not concerned with abstract
ideas of democracy or communism. They are in-
terested in practical solutions to their problems in
terms of food, shelter, and a decent livelihood.
When the Communists offer quick and easy reme-
dies for all (heir ills, they make a strong appeal to
these people.



552



Department of State Bulletin



Basis of Security

These are the facts we must face. What do
thev mean to our national security ? To the peace
and well-beinj; and freedom of the American
people, in short, to the fundamental aims of our
foreign policy?

We are spending billions for militai'v defense —
as we must. We are spending other billions for
economic reconstruction in Europe and vital points
in the Far East — as we must. We are organizing
joint defense through the North Atlantic Treaty
and the Military Assistance Program. We are
organizing joint action to remove trade barriers
through tariff and reciprocal trade agreements and
through the International Trade Organization.
We are attempting to remove the causes of interna-
tional friction and misunderstanding by playing
an active role in the United Nations.

All the things we do are, in the last analysis,
measures of national securit}' — the broadest kind
of security for our free and democratic way of
life.

This legislation that is before you, this "Act for
International Development" has the same broad
purpose. In a very real sense, it is a security
measure. And as a security measure, it is an
essential arm of our foreign policy. For our mili-
tary and economic security is vitally dependent on
the economic security of other peoples.

But our foreign policy is not based on security
alone. We have never been satisfied merely to
resist a threat — of communism or any other "ism."
Our policy is broader than this. It is essentially
constructive. It is based on the assumption that,
in the world today, our own welfare is closely re-



Online LibraryUnited States. Dept. of State. Office of Public CoDepartment of State bulletin (Volume v. 22, Apr- Jun 1950) → online text (page 9 of 116)