Documents / FOIA release
This Top Secret study by the Interdepartmental Coordinating Group on Germany and Berlin, dated July 12, 1961, and released by the Central Intelligence Agency, answers NSC Directive No. 58 of June 30, 1961. It sets out courses of action for the Berlin crisis but does not judge their merits. It covers imminent presidential decisions, a three-phase timetable running to January 1, military preparations and mobilization, covert action, economic sanctions, public information, negotiating positions and checkpoint procedures for East German personnel.
“Cooper”8 pages
## SECRET Factors other than the effect of an inflationary rise in domestic price levels due to domestic reactions need be taken into account, i.e.: (a) It is conservatively estimated that the cost to the balance of payments of stationing one additional Army division in Europe, together with supporting air and naval force is $250 - $300 million per year. (See Appendix B.) For the four alternatives the estimates of additional annual balance of payments impact would be: Alternative I - 2 divisions $500-600 millions Alternative II - 4 divisions 1,000 - 1,200 millions Alternative III - 6 divisions 1,500 - 1,800 millions Alternative IV - 12 divisions 3,000 - 3,600 millions (b) Our balance of payments in a period of recovery or greatly increased economic activity could be vulnerable to increases in prices of imported raw materials. Here the experience in 1950 during the early months of the Korean outbreak should be noted. From June 1950 to January 1951 the prices of imported raw materials increased 66 percent. During July and August 1950 prices of imported raw materials rose 10.2 and 14.7 percent, respectively, while the Wholesale Price Index rose 2.8 and 2.1 percent. The general supply situation in many commodities is more favorable today than in 1950, but it could change quickly. (c) The movement of short term capital funds from the United States to other currencies which added to our balance of payments deficit in 1960 and the conversion of dollar claims into gold, which marked the last part of 1960, could be revived by fears of U. S. inflation, unfavorable developments in our balance of trade and payments accounts, or U. S. military involvement. 8. It is difficult to forecast the consequences for the U. S. economy of a developing Berlin crisis psychology. However, it is only prudent to plan in advance to deal with the unfavorable contingencies described above. 9. Preparation for action to prevent or minimize dislocation of the domestic economy as a result of establishing the Berlin capability leads to a consideration of control machinery. Controls over the economy in a period
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FOIA release, from the cia-readingroom collection. The PDF is mirrored here; the original link is under it. The text was read from the page images by an OCR model; expect the odd misread word. 163 pages are in the text index: search them above, or from the library's search.