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Military government weekly information bulletin
Number 97 (June 1947)

Szymczak, M. S.
The United States' stake in German economic recovery,   pp. 13-18 PDF (3.9 MB)

Page 14

nery ant it would make it also unnec-
essary to divert scarce American
foodstuffs to Germany.
While the principle of assistance
to German recovery has been gene-
rally accepted in this country, it has
been very difficult to carry out the
program on an adequate scale. For
obvious reasons, of justice and po-
licy, the countries invaded by Ger-
many have been given a prior claim
to our aid. Our financial and mate-
rial resources are limited and food-
stuffs and raw materials continue to
fall short of total demand. The allo-
cation of wheat and non-ferrous me-
tals, for instance, is a task that simply
cannot be fulfilled to the satisfaction,
of all. Similarly, coal, of which Ger-
many is a major producer, is in gen-
erally short supply. In order to pro-
mote reconstruction in the rest of
Europe, we have had to undertake
substantial exports of German coal
even though the revival of German
manufacturing industry would have
been considerably if it had been pos-
sible to retain' German production
for German domestic use.
It may be hoped that these scarci-
ties will disappear within a few
years, but other obstacles may take
their place. Concern has frequently
been expressed that the reconstruc-
tion of German industry may go too
far and restore Germany's war poten-
tial. The occupying powers have tried
to differentiate between industries
that- could be used for aggressive
purposes and therefore should be
restricted, and others that might be
considered peaceful and therefore
should be encouraged. The most in-
nocuous industries, however, could
conceivably be used for war purpo-
ses, and dangerous ones frequently
are indispensable for peacetime uses.
For this reason, some of the United
Nations are critical of any move to
improve the level of German industry
even though they concede that such
an improvement would benefit them
from the economic point of view.
Finally some  countries see  in
Germany less a source of supplies
or a market for exports than a
dreaded  competitor.  At present,
such fears seem  prematuine since
production  the  world  over  has
not caught up with demand, and
German    production  remains  a
negligible part of the total. As soon,
however, as world market conditions
become less favorable to the sellers
any increase in German industrial
production and especially in German
industrial exports, may injure the
interests of some industrial group in
other countries. Although such ex-
ports will in turn make possible im-
ports into Germany and thus benefit
the economies of Germany's trade
partners as well as its own, the
groups benefiting from access to the
German market frequently will be
different from those affected by Ger-
man competition.
Despite the conflict of objectives
and the limited financial and mate-
rial means at the disposal of the oc-
cupation authorities, there has been
a degree of rehabilitation in Ger-
Food and Agriculture
The food situation continues to be
the central German problem. It is far.
from satisfactory, but we have been
able to avoid not only outright star-
vation but also any serious deterio-
ration of public health. Since last fall
the official ration has been main-
tained in the American and British
Zones until recently at 1,550 calories
daily for the so-called normal con-
sumer. This ration still is more than
one-fourth below the minimum neces-
sary to insure health in the long run
and more than two-fifth below the
German prewar standard of nutrition.
Moreover, the diet is far poorer in
quality than would be advisable from
the point of view of nutrition, a lar-
ger proportion consisting of grain
products and a smaller proportion of
so-called protective foodstuffs.
Even so, the ration has been main-
tained only by importing into the
combined American and British Zones
foodstuffs equal to about 60 percent
of their domestic production. These
imports, including monthly shipments
of 200,000 tons of bread grains and
flour, and substantial quantities of
potatoes, sugar, fish, and milk, require
an expenditure of $ 360 million in the
current crop year.
The food situation is constantly
being threatened by the fact that
stocks of supplies are dangerously
low. Food is needed in many parts
of the world. For the sake of food
importing countries a further rise in
world market prices must be avoided
as far as possible and priorities must
be established by the exporting na-
tions. Every ton of food allotted to
Germany causes hardship in other
parts of the world. Difficulties in
ocean transportation frequently delay
shipments urgently needed for main-
taining stocks in Germany at the
minimum level needed for the plan-
ning of equitable distribution.
German farmers frequently fail to
deliver their quotas. Trains must be
rerouted to alleviate a crisis in some
part of Germany, thus creating a
shortage in another part. Losses from
pilferage increase in proportion to
the deterioration of food conditions.
An unfortunate accumulation of such
factors was the cause of the diffi-
culties currenthy experienced in the
Ruhr district. Delays in delivering
the full rations invariably lead to
unrest, diminish the efficiency of
labor and the output of industrial
goods, and thus add to the difficul-
ties of rehabilitation.
In the future, we expect domestic
production, collection, and distribution
to yield substantially larger quanti-
ties than this year. Such an improve-
ment will depend upon the avail-
ability of fertilizer and upon a sup-
ply of industrial consumer goods
which will induce farmers to raise
more crops for sale. It also will de-
pend upon the enforcement of a strict
program of collection and distribution
which must be efficiently performed
by German officials...
In the long run, however, the effi-
ciency of industrial labor cannot be
maintained on a diet representing less
than 2,600 calories daily for the so-
called normal consumer. The Ameri-
can and British Zones cannot expect
to produce more food than sufficient
for an average of 1,600 calories daily.
Import requirements in the long run
therefore will be the equivalent of
at least 1,000 calories daily, or about
two-thirds more than actual imports
in the current year.
Industrial Production
In 1945, most manufacturing indus-
tries in the Western Zones of Ger-
many were at a standstill. By No-
vember 1946, industrial production in
the American Zone had reached 44
16 JUNE 1947

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