Germany Is Our Problem

By Henry Morgenthan, Jr.
THE former Secretary of the Treasury sets down in this compact volume the famous “Morgenthau Plan" for handling defeated Germany, and the supporting argument for it. He includes in the preface a photographic reproduction of the secret memorandum drawn up under his direction by the Treasuri, at the request of President Roosevelt, and taken by Mr. Roosevelt to the Quebec Conference. There the memorandum became one of the bases of Allied policy. In its essentials it was later incorporated into the Potsdam Agreement. Hence, Mr. Morgenthau’s book has an importance far beyond any ordinary argument about what should be done with the perplexing Germans. It is a historical document of first importance.
Those who are inclined, less than a year after Germany’s collapse, to repeat the performance of 1919-1939 should be forced to study this book page by page. Economists who insist that the proper course for the Allies is to rehabilitate German heavy industry and to re-establish the German economy have in the author of Germany Is Our Problem an opponent whose competence is in some respects unique. The former Secretary of the Treasury perceives what many of his critics seem to be incapable of understanding: that the German problem is more than a question of trade statistics, production figures, population analysis, and logic. It is all these, and simultaneously it is historical, racial, social, political, and psychological. To emphasize some of these aspects while ignoring the others is to betray inability to learn from experience.
Mr. Morgenthau draws upon a wealth of data gleaned during his long tenure in Washington before and during the war, as the battle against the Nazi octopus developed to its climax. To permit Germany to retain her heavy industries, he warns, is to place Europe and the world once more in jeopardy. To shift the German economy to agriculture and to the light industries essential to agriculture is the only effective safeguard. Such a reconstituted Germany would be neither the “ industrial slum ” predicted by his opponents nor a Reich denuded of means of subsistence. The distribution of Germany’s major industrial functions to neighboring European states would strengthen Europe and peace as well.
It is interesting to notice that the clamor for salvaging German heavy industry has arisen only as the Allies have belatedly borne down upon the German industrialists and cartel leaders. This same phenomenon (with much the same arguments) is also observable in Japan. Evidently the real tussle with the forces which produce war in modern society is just beginning.