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 ## 3. State of Existing Powers The direct and indirect control powers at the disposal of the government without new legislation are inadequate to deal with the threat of psychological inflation in the face of increased international tension and a military build-up. These powers cover only: general monetary and credit policy through the Federal Reserve System; rudimentary allocation of materials and facilities under the Defense Production Act of 1950; power to sell out of Defense Production Act stockpiles to counteract speculation in raw materials; controls over exports and external financial transactions; and the ability to reduce or defer other Federal expenditures. The force of these powers is dubious, and in any case they do not extend to direct control over prices, wages, salaries and rents, or to selective restraint of credit. However inadequate they may be, it is important that these present powers be prepared for rapid use. The reason is that a request for additional legislation, whenever made, may be expected to set off inflationary reactions of the type experienced in 1950: scare buying by consumers, anticipatory increases in prices, and the hoarding of inventories. ## 4. Further Powers Needed A package of new economic control legislation capable of handling the destabilizing effects of a Berlin crisis should include: (a) Authorization for the President to impose a temporary freeze on all prices and wages if required in the interval between the request itself and the passage of more comprehensive legislation. (b) Enabling legislation for comprehensive controls over prices, wages, salaries, rents and selected forms of credit, for the settlement of labor disputes, and for requisitioning. (c) Discretionary authority for the President to sell excess materials from strategic stockpiles. (d) Discretionary authority for the President to meet needs for revenue and the demands of economic stabilization by varying the first-bracket rates of the personal income tax within specified limits. The timing of the President's request to Congress for this package of legislation is a major problem to be solved. The options are to make the request as soon as the military preparedness measures themselves become
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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.