Potsdam Conference, meeting (July 17–Aug. 2, 1945) of the principal Allies in World War II (the United States, the USSR, and Great Britain) to clarify and implement agreements previously reached at the Yalta Conference. The chief representatives were President Truman, Premier Stalin, Prime Minister Churchill, and, after Churchill's defeat in the British elections, Prime Minister Attlee. The foreign ministers of the three nations were also present. The so-called Potsdam Agreement transferred the chief authority in Germany to the American, Russian, British, and French military commanders in their respective zones of occupation and to a four-power Allied Control Council for matters regarding the whole of Germany. The Allies set up a new system of rule for Germany, aimed at outlawing National Socialism and abolishing Nazi ideology, at disarming Germany and preventing its again becoming a military power, and at fostering democratic ideals and introducing representative and elective principles of government. The German economy was to be decentralized, and monopolies were to be broken up; the development of agriculture was to be emphasized in reorganizing the German economy. All former German territory E of the Oder and Neisse rivers was transferred to Polish and Soviet administration, pending a final peace treaty. The German population in these territories and in other parts of Eastern Europe was to be transferred to Germany. A mode for German reparations payments was outlined. A Council of Foreign Ministers was established to consider peace settlements. The so-called Potsdam Declaration issued (July 26) by the conference presented an ultimatum to Japan, offering that nation the choice between unconditional surrender and total destruction. (The atom bomb was not actually mentioned.) Rarely was any agreement so consistently breached as was the Potsdam Agreement. The work of the Allied Control Council for Germany was at first blocked by France, which did not feel bound by an agreement to which it had not been party; the council had not even begun to function when the rift caused by the cold war broke it up. The vague wording and tentative provisions of the Potsdam Agreement, allowing a wide range of interpretation, have been blamed for its failure.
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