On 12 May 1945, Churchill cabled President Truman that an “iron curtain” had descended in front of the Soviet troops and that no one knew what was going on behind it. But the Western powers carefully weighed up the possible consequences of letting Stalin have a say in reparations on the Rhine and the Ruhr. The result was that at the Potsdam Conference (17July to 2 August 1945), the original aim of which was to create a new European order, agreements were reached which consolidated rather than eased the tensions. The four powers agreed on the matter of denazification, demilitarization, economic decentralization and the reeducation of the Germans along democratic lines.

The Western powers also gave their fateful consent to the expulsion of Germans from Poland, Hungary and Czechoslovakia. The West had insisted that the transfer be carried out in a “humane” fashion, but in the following years some 7.75 million Germans were brutally deported. They were made to suffer for Germany’s war crimes, but also for the shift in Poland’s western boundary as a result of the Soviet Union’s occupation of Konigsberg and eastern Poland. Practically the only point on which East and West agreed was that the four occupation zones should be preserved as economic and political units. At first, each power was to draw its reparations from its own zone. As was to be seen later, however, this set a precedent in that not only the reparations arrangement but also the attachment of the four zones to different political and economic systems made Germany the country where the Cold War manifested itself most of all. This came about in stages.

Meanwhile the task of establishing German political parties and administrative authorities had begun in the mdividual occupation zones. This happened very quickly in the Soviet zone under rigid control, with the result that even before the end of 1945 parties and several central administrative bodies had been formed. n the three Western zones the development of a political system was a bottom-to-top process, that is to say, Political parties were permitted only at the local level at f’rst, then at the state level after the Lander had been created. Only later were they allowed to form associa-tions at the zonal level.