Possible Consequences of Soviet Refusal to Implement the West Berlin Rail Strike Agreement

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP78-01617A000700210002-6
• Release Decision: RIFPUB
• Original Classification: T
• Document Page Count: 3
• Document Creation Date: November 9, 2016
• Document Release Date: July 20, 1998
• Sequence Number: 2
• Publication Date: September 30, 1949
• Content Type: IM

Document Approved _F IIA-RDP78-01617A000700210002-6
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DECLASSIFIED
'lass. CHANGED TO: TS S C
DDA Memo, 4 Apr 77 '50 Sep term er 1949
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INT ,LLIGEITCE i^THAi3DtJM T10. 230
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SUBJECT: Possible Conseque:2ces of Soviet Refusal to
Implement the West Berlin Rail Strike Agreement
1. Conclusions.
The Soviet authorities have refused to comply with
the terms of the agreement settling the western Berlin rail
strike in June 1949, and the :'aeetern Commandants have
broken off further negotiations on the normalization of
affairs in Berlin. On 30 September the P,1agistrat stopped
its conversion of 40 percent of rallworkerst wages from
east marks to west marks? Under these circumstances, CIA
estimates that the following consequences may result :
(a) a renewed rail strike against the Soviet-
controlled Reichsbahn;
(b) attendant violence which may result In the
destruction of Reichsbahn.property and facilities;
(c) Soviet reprisals,
Should these consequences materialize, CIA estimates that
traffic between western 3erlin and western Germany would be
paralyzed, and the present soraous economic condition of west
Berlin would be worsened, with the political results which
this implies"
2, Discussion.
In several respects, the economic position of west
Derlin has deteriorated since the lifting of the blockade in
May 1949. In addition to a declining industrial production
and steadily rising unemployment, the ttagistrat has been faced
with most serious financial difficulties arising from shortage
of cash and lack of credit. Although additional financial
assistance has been promised from ECA counterpart funds and
western German subsidies, none of this has been made available
to date, and feeling in western Berlin Is becoming embittered
at the apparent neglect of western Berlin interests by the
western occupation authorities.
The situation caused by Soviet refusal to implement
the terms of the agreement ending the west Berlin rail strike
in June 1949 is assuming particularly serious proportions o
According to the strike settlement the Soviet-controlled
Reichsbahn authorities agreed to the following conditions
Approved For Release : CIA-RDP78-01617A000700210002-6
 Approved For Release: 78-01617A000700210002-6
(a) to refrain from reprisals against strikers;
(b) to pay railworkers resident in the west
sectors a minimum of 60 percent of their wages In
west marks, regardless of their place of employment;
(c) to increase the west mark payment above the
60 percent level to the extent permitted by
Reichsbahh income of west marks; and
(d) to collect west sector fares and freight
charges exclusively in west marks to secure sufficient
income to meet west-mark wage obligations. In turn,
the Berlin Liagistrat was to convert the remaining
40 percent of railworkers' wages into west marks on
a one-to-one basis, to reduce this conversion as
Iteichsbalzn west mark payment increased, and to
terminate conversion entirely on 30 September 1949.
The western Commandants contend that the Reiehsbahn
has consistently violated the terms of this agreement' yam':
(a) dismissing west-sector workers or transferring
them to new places of employment in the east sector on
threat of dismissal;
(b) paying west-sector residents eriployod in the
east sector exclusively in east marks; and
(o) refusing to increase payment in west marks over
the 60 percent level even though Reichsbahn receipts
in west marks are estimated as sa en permit
full payment of wages in west marks.
Two letters of protest addressed by the western
Commandants to the Soviet Commandant have been rejected
by General Kvashnin, SUP chief of transport in the Soviet-
Zone o Kvashnin not only denied the above afegations but
asserted that repairs to the damage done the Reichsbahn by
the strike would require all the west-mark income now
available. This rejection led to a decision of the western
Commandants to break off further negotiations between thesis
Commandants on the normalization of affairs in Berlin.
action was taken on 28 September. They have also ordered
that the Magistrat stop its conversion of 40 percent of the
west-sector railworkers' wages on 30 Septembers
The consequences of this impasse to US interests are
as follows:
(a) the reduction in real wages of the west-sector
railworkers may lead to an organized strike or to wild-
cat strikes and acts of sporadic violence against
Reichsbahn.property, thus inviting Soviet reprisals;
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(b) a west Berlin-rail strike in combination
with Soviet reprisals, could paraiyze rail accoss to
Berlin from western Germany. The interruption or
suspension of rail traffic would seriously hinder
the efforts of west Berlin in its present depleted
economic condition to maintain itself.
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