Telegram from Harriman to Hull

033.1161 Johnston, Eric/6-3044 : Telegram

The Ambassador in the Soviet Union (Harriman) to the Secretary of State

Moscow, June 30, 1944 – 3 p.m.

[Received July 1 – 2:40 a.m.]

2369. Reference Embassy’s 2295, June 27, 4 a.m. The most interesting features of Eric Johnston’s conversation with Marshal Stalin were as follows:

1. Stalin paid tribute to the assistance rendered by the United States to Soviet industry before and during the war.  He said that about two-thirds of all the large industrial enterprises in the Soviet Union had been built with United States help or technical assistance.  Johnston remarked that he had noticed that distribution methods had failed to keep pace with production methods and said he felt that American chain store executives might help in improving Soviet distribution methods after the war.  Stalin agreed and indicated that assistance in this field would be welcome.  

1. In reply to Johnston’s inquiry, Stalin said that after the war Soviet imports would be largely industrial equipment and machinery and not consumer goods.  Part of this equipment, however, would be used to produce consumer goods.  Domestic manufacture would also be applied to the production of equipment for rehabilitation and reconstruction.  He explained further that the Soviet problem was not only to rebuild the devastated areas, but also to reconstruct their industrial machine.  They had made previous mistakes in their plans which would now be corrected.  

1. Stalin said that Soviet domestic requirements in the foreseeable future would prevent the Soviet Union from becoming and exporting nation of manufactured goods.  Exports would never play a great role in Soviet economy except to cover imports.  The Soviet Government has never fought for foreign markets; on the contrary it has always endeavored to widen its imports.  Foreign markets for manufactured goods would be left open to Great Britain and the United States.  With Germany and Japan destroyed there would be enlarged opportunities.  Stalin enumerated the known raw materials which could be exported to the United States after the war and in reply to an inquiry as to the possibility of exporting certain specialized manufactured gods the United States desired to purchase, he felt sure that the Soviet Union could supply them.

1. The goal of Soviet iron and steel production for postwar would be 40 million tons of pig iron and 60 million tons of steel annually.  Stalin explained that this was a big undertaking considering that the present annual production was between 10 million and 12 million tons of steel and 7 million and 8 million tons of pig iron as compared with 20 million to 22 million tons and 16 tons, respectively, before the war.  

1. American technical assistance and equipment might well be required in the rehabilitation and development of the Soviet post-war electric power production.  

1. Stalin was very anxious to obtain Johnston’s views on the presidential elections.  Johnston expressed the belief that the nation would reelect the President on his foreign policy, that the house would be Republican but that the Senate would remain democratic.  He added that the President and Mr. Hull were working in cooperation with the Senate on foreign policy and that he was satisfied Congress would continue to support the President on foreign policy.  Stalin stated that “his colleagues were very much interested in the elections and that some were perturbed lest the President be not reelected”.  He said that the Russians knew the present United States leaders, have a common language with them, and that cooperation had been established.  It was not certain, however, what would happen if the President were not reelected.  The Soviet Government remembered with some apprehension the Hoover administration.

1. In referring to the invasion, Stalin said: “Now Germany must realize that no large scale war can be waged without a powerful navy.  They are fools to have attempted a great war without a great fleet.”  Stalin added that he also had in mind a merchant fleet which of course would not exist without a great navy.  On the other hand a great navy could not be developed without the presence of a great merchant fleet from which it draws its personnel.  I am reporting these remarks as a further indication of the desire of the Soviet Union to have a strong navy and merchant fleet in the post-war period.  

A full report of the conversation is going forward by air mail.

HARRIMAN