Episode 20. Who put up the Berlin Wall?

I think some of you may have heard on more than one occasion about how that bloodthirsty tyrant Stalin set up a blockade of West Berlin in 1948 and how the freedom-loving nations organized the Berlin airlift to circumvent it. But today we’ll let you in on what really happened.

After Stalin refused to get sucked into the draconian Bretton Woods Agreement and then Churchill gave his famous speech in Fulton, MO, the West began squeezing the USSR on all available fronts. The most convenient site for this was the vanquished country of Germany.

Germany Zones of Occupation 1946
Germany Zones of Occupation 1946

Immediately after defeating the Nazis, the Allies agreed to split Germany into three occupation zones: Russian, British and American. But the country itself was in no way divided by borders – this was united Germany but without any semblance of state power within its own borders other than the military authorities of the occupation. Berlin was sliced up in a similar way. The city had been stormed by Soviet troops, but as agreed, the USSR allowed the Allied forces to enter the German capital. On June 5, 1945, the Berlin Declaration was adopted, which announced the assumption of supreme authority in Germany by all the powers that had conquered the Nazis. Later, at the insistence of Charles de Gaulle, the French also lopped off their own chunk of German territory – they were given the Saar region to occupy and were also allocated a sector of Berlin. There were now four occupation zones. Then, on Aug. 30, 1945, a governing body was established – the Control Council – through which the Allies could work together and that held supreme power in that occupied country. On Jan. 1, 1946, trade began between the Soviet and British zones. For a while everything went smoothly – due to the fact that the USSR had not yet refused to recognize the supremacy of the Federal Reserve’s dollar …However, once that Rubicon had been crossed, things started to heat up.

March 5, 1946 – the date of Churchill’s speech and the beginning of hostile overtures from the West.

Aug. 6, 1946 – American General Lucius Clay makes an announcement in Stuttgart about the impending unification of two zones of occupation.

Dec. 2, 1946, the US and Great Britain sign an agreement in New York to merge their zones of occupation. An entity with the odd name of Bizone emerges on the map of Europe.

Jan. 1, 1947 – all trade between the Bizone and the other zones is now to be conducted in the dollars of the Federal Reserve. And what currency had been used to trade with the Soviet zone throughout all of 1946? Reichmarks. The USSR has no dollars and the Germans have even less access to them. What is the reason for demanding that trade be conducted only in dollars? It means that the choice is either to submit or to cease all trade between the two halves of Germany.

March 12, 1947 – President Truman delivers his Truman Doctrine speech before Congress and the Cold War officially begins.

June 5, 1947 – the famous Marshall Plan is adopted.

Feb. 23 – March 6, 1948 – the London Six-Power Conference is held, attended by the US, UK, France, Belgium, the Netherlands, and Luxembourg, at which a separate decision is made to create a German state within the confines of the three occupation zones.

Thus, the US and UK undertook to split Germany into two states. In response, the USSR withdrew from the Control Council on March 20, 1948 and it immediately ceased its work. The West no longer needed a governing body to oversee all of Germany. They were forging a new German state.

But then something quite interesting happened. Between June 20 and 21, 1948, a monetary reform was carried out in the three Western occupation zones that looked quite a lot like highway robbery. The Reichsmark that Hitler had used was replaced by the Deutschmark. Each German was permitted to exchange 60 Reichsmarks at a rate of 1:1. Forty marks could be exchanged immediately, and another 20 two months later. Half of their savings could be exchanged at a rate of 1:10, while the second half was frozen until a later date when it could be exchanged at 1:20. But pensions, salaries, payments, and taxes were recalculated in the new currency at a 1:1 rate.

Allied West Germany Deutsche Mark (1948)
Allied West Germany Deutsche Mark (1948)

Legal entities faced an even sadder fate. All businesses were allocated 60 marks for each employee. All government debt that was owed in the old Reichsmarks was zeroed out without any compensation! As result, approximately 2/3 of bank assets, which had been invested in government bonds, were now worthless. And all this happened in one fell swoop – like a well-planned military operation. German marks were secretly printed in the US and put into circulation without warning.

Now let’s consider this situation for a moment. What do you think happened in a country where a new currency was introduced in one half, while the old currency continued to be used in the other half? The Germans had been offered the opportunity to exchange their savings at a rate of 1:10 or 1:20, so what would be the logical next step for them to take? They tried to spend their old marks anywhere that that money was still being accepted. In other words – in the Soviet zone of occupation. And that’s exactly what happened. The Germans rushed to transform their old Reichmarks into goods in the “eastern” zone. They vacuumed up everything on the store shelves, focusing only on getting rid of their money. In light of this outrageous situation, what was the Soviet administration supposed to do? They had to seal up the borders of their zone and try to stem this flood of money, otherwise the economy would collapse – no goods would be left in the stores at all. And this was precisely what the West was counting on: inciting a riot and then provoking the USSR into a “bloody crackdown on popular protests.”

Berlin 1948

The borders of the occupation zone could be sealed of course, but what to do about Berlin? There was as yet no wall there – the city was still undivided. And “as luck would have it,” the monetary reform was scheduled to take effect in the western sector of Berlin three days later than in the Bizone and the French occupation zone – on June 25, 1948. It was as if someone wanted the Germans to take the hint – take your Reichsmarks to Berlin! They still accept them there. And cars from all over Germany would now be filled with cash and driven straight to the German capital. But luckily the Allies and the Germans working for them had to have a special pass to travel to Berlin via the Soviet zone. What to do? The Soviet government decided to ban entry to Berlin as well as passage to Berlin through the Soviet zone. And residents of the western sector of the city were barred from going into eastern Berlin just to vacuum up everything on the store shelves. This was the “blockade” of West Berlin that Stalin proclaimed.

The East German mark would be introduced much later.

On July 1, 1948, the military governors of the three occupation zones presented what are known as the Frankfurt documents to the minister-presidents of the eleven German states that lay within their jurisdiction. The decision was made in London to effectively order the Germans to create a new national government! The overseas capitals were not concerned that this would divide both the country as well as its people.

The future West Germany would occupy 52.7% of pre-war German territory and accommodate 62% of its population.

And after that, events rolled merrily along, keeping to the familiar script.

On May 23, 1949, the birth of the Federal Republic of Germany (FRG) was announced. The degree of independence granted to this puppet state’s foreign policy is clear from the fact that West Germany’s Federal Foreign Office did not even exist until March 15, 1951, and the governments of the US and UK did not proclaim the restoration of West Germany’s full sovereignty in foreign affairs for yet another three years (June 24, 1954).

Meanwhile the USSR was doing all it could to oppose the West’s plans to create a German state in only one part of Germany, leaving the question of the future state structure and neutrality of the Germans undecided.

Moscow responded to the establishment of West Germany by proclaiming the formation of the German Democratic Republic (DDR) on Oct. 7, 1949. However, Stalin thought it wrong to have two Germanys right in the heart of Europe. Therefore, on March 10, 1952, the USSR sent a proposal to the West, which history would later dub the “Stalin Note.” This document provides clear evidence that the Soviet leader’s goal was not to create his “own” German state, but to unify Germany in order to prevent Washington and London from using the Germans as pawns in their own policy.

German Democratic Republic map
German Democratic Republic map

The Soviet Union wanted to hold immediate negotiations about the reunification of Germany and free elections throughout its territory, with the subsequent formation of a single government that should retain a neutral status. Need I remind anyone that the “Stalin Note” was ignored by the West? When someone who is naive or uneducated begins to hold forth about who is to blame for the decades-long division of the German people, just remind him of this fact. The West blocked the negotiations between the two “Germanys.” And West Germany did not recognize East Germany until 1972. Prior to that the two German states did not recognize each other and did not have diplomatic ties.

If you ask a modern person who gets his information from the “independent” media about the difference between West and East Germany, you will most likely hear something about “totalitarianism.” Supposedly one Germany was free in a way that the other Germany was not. If you press him for a more specific answer, then you will most likely hear that there was no multiparty system in East Germany, which was ruled solely by the Communist Party, while West Germany was home to many political parties. Well, this is a complete … lie. By June 10, 1945 the Soviet military administration in Germany had already authorized the activities of the democratic parties and trade unions in its zone. And it did so before our “Allies” took similar actions in their occupation zones. Four parties were created in June and July 1945, and in 1946 two of them merged to create the Socialist Unity Party of Germany (SED), which later became the ruling party. I think many readers will find it interesting to learn that a multiparty system existed there until the very last days of the German Democratic Republic. The very first East German parliament – the provisional People’s Chamber – had 330 deputies in 1949: the SED held 96 seats, the Liberal Democrats and CDU won 46 seats each, the National Democrats – 17, and the Democratic Farmers’ Party – 15. The remaining seats were divided between trade unions and the Free German Youth. And if anyone thought that this was nothing but window dressing and that the “bloodthirsty regime” later strangled the multiparty system, then that person would be flat-out wrong. If you try to claim that the East German parliament was a mere façade, then you must admit that every other parliament in the world is equally deserving of this label. The truth is this: socialist Germany and its multiparty system continued to develop in unison. By 1986, the 500 deputies in the People’s Chamber included ten factions from five parties, trade unions, the Komsomol, the Democratic Women’s Federation of Germany, the Cultural Association of the DDR, and even the Peasants Mutual Aid Association.

Volkskammer 1990
The People’s Chamber of the German Democratic Republic

The biggest media outlets in the world today often air clichés about the “aggressive Warsaw Pact.” This is another patently obvious lie. The West created NATO in 1949 and the USSR founded the Warsaw Treaty Organization in 1955. And that military bloc emerged in response to the militarization of Europe by the West. The USSR did not react to the creation of NATO until West Germany became a member of that bloc. In a special statement on Jan. 15, 1955, the Soviet Union declared that negotiations between the two German states on the subject of neutrality would become meaningless if one of them joined a Western military bloc. But the United States and Britain deliberately created a military threat in Europe. They needed an unnatural situation in which a divided people had two governments and must be equipped with two armies facing off against one another. London and Washington have been only too happy to replicate this situation again and again: in India and Pakistan, Cyprus and Northern Cyprus, Ireland and Northern Ireland, Croatia and Serbia, and in Russia and Ukraine …

And so West Germany became a member of NATO on May 9, 1955. In response, the Warsaw Pact military bloc was created on May 14, 1955. Even the famous East German army – one of the finest in the world throughout the 34 years of its existence – was established only after the “Allies” shamelessly violated the decision made at the Potsdam Conference in 1945 that prohibited Germany from maintaining its own armed forces. Bonn officially announced the formation of the Bundeswehr on Nov. 12, 1955, but it was not until 1956 that the National People’s Army of the DDR was established …

So who initiated irreconcilable confrontation right in the heart of Europe after the WWII and 40-year division of the German people?

The presented text was taken from the book by the Russian historian, writer and political activist Nikolay Starikov “Proxy Wars“, St.Petersburg, 2017. Adapted and translated by ORIENTAL REVIEW.

Reposts are welcomed with the reference to ORIENTAL REVIEW.

PREVIOUS EPISODES

Episode 19. How Churchill lost and reclaimed his victory in World War II

Episode 18. How Britain assisted the Soviet Union’s fight against Hitler

Episode 17. Britain – Adolf Hitler’s star-crossed love

Episode 16. Who signed death sentence to France in 1940?

Episode 15. Poland Betrayed

Episode 14. How Adolf Hitler turned to be a “defiant aggressor”

Episode 13. Why London presented Hitler with Vienna and Prague

Episode 12. Why did Britain and the United States have no desire to prevent WWII?

Episode 11. A Soviet Quarter Century (1930-1955)

Episode 10. Who Organised the Famine in the USSR in 1932-1933?

Episode 9. How the British “Liberated” Greece

Episode 8. The Great Odd War

Episode 7. Britain and France Planned to Assault Soviet Union in 1940

Episode 6. Leon Trotsky, Father of German Nazism

Episode 5. Who paid for World War II?

Episode 4. Who ignited First World War?

Episode 3. Assassination in Sarajevo

Episode 2. The US Federal Reserve

Episode 1. Bank of England

 

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