CHAPTER SIX
THE NIGHTMARE OF DEPRESSION AND THE VISION OF OMNIPOTENCE

The President [Roosevelt] .  .  . said that he himself would not be in favor of the creation of a new Assembly of the League of Nations, at least until after a period of time had transpired and during which an international police force composed of the United States and Great Britain had had an opportunity of functioning.

REMARKS TO WINSTON CHURCHILL, AUGUST 1941, AS REPORTED BY SUMNER WELLES

For unless there is security here at home there cannot be lasting peace in the world.

FRANKLIN DELANO ROOSEVELT, JANUARY 1944

It is important that I retain complete freedom of action after this conference [in Moscow] is over.

FRANKLIN DELANO ROOSEVELT, OCTOBER 1944

We cannot go through another ten years like the ten years at the end of the twenties and the beginning of the thirties, without having the most far-reaching consequences upon our economic and social systems. .  .  . We have got to see that what the country produces is used and sold under financial arrangements which make its production possible. .  .  . My contention is that we cannot have full employment and prosperity in the United States without the foreign markets.

DEAN ACHESON, NOVEMBER 1944

.  .  . if the Russians did not wish to join us they could go to hell.

HARRY S TRUMAN, REMARK OF APRIL 23, 1945,
AS REPORTED BY CHARLES E. BOHLEN

In Rumania and Bulgaria—and rather less decisively in Hungary—the Russian Government has sponsored and supported Governments which are democratic in the Russian rather than in the English-speaking connotation of the term and whose friendship for Russia is one of their main qualifications. This policy would fit in well enough with a “zones of influence” conception of the [peace] settlement; and it would be idle to deny that other great nations, both in the remoter and in the recent past, have pursued the same policy in regions of the world which they deemed vital to their security. During the past few weeks, however, the English-speaking Powers have adopted an attitude towards Balkan affairs which seemed to imply the contrary view that any of the three Powers may claim a right of intervention even in regions especially affecting the security of one of the others; and the clash of these opposing views, each of which can be formidably sustained by argument, underlay all the difficulties of the Foreign Ministers in their discussion of Balkan affairs.

LONDON TIMES EDITORIAL, OCTOBER 3, 1945

.  .  . the United States has it in its power to increase enormously the strains under which Soviet policy must operate, to force upon the Kremlin a far greater degree of moderation and circumspection than it has had to observe in recent years, and in this way to promote tendencies which must eventually find their outlet in either the break-up or the gradual mellowing of Soviet power.

GEORGE FROST KENNAN, FEBRUARY 1946—JULY 1947

The situation in the world today is not primarily the result of the natural difficulties which follow a great war. It is chiefly due to the fact that one nation has not only refused to cooperate in the establishment of a just and honorable peace, but—even worse—has actually sought to prevent it.

HARRY S TRUMAN, MARCH 1948

I.ROOSEVELT AND STALIN CONFRONT THE DILEMMAS OF VICTORY

Politicians become statesmen, not by honoring pious shibboleths, nor even by moving men to action with inspiring rhetoric, but by recognizing and then resolving the central dilemmas of their age.

When measured against this demanding standard, Franklin Delano Roosevelt’s performance after 1940 poses a difficult problem in judgment for the historian. On the one hand, he seems clearly enough to have sensed the contradiction between his intellectual, emotional, and policy commitment to America’s traditional strategy of the open door, and the new circumstances arising out of World War II which called for the acceptance of limits upon American expectations and actions, and for the working out of a concert of power with other major nations. Though it was not in any sense unique, Roosevelt’s recognition of that new reality does entitle him to a place of honor within the community of American policymakers. It also explains and justifies the praise of his partisans.

On the other hand, Roosevelt did not resolve the dilemma posed by that contradiction between tradition and reality. He occasionally spoke candidly of the problem. He offered a few very general ideas about the kind of things that could be done to adapt American thinking and policy to the new conditions. And he suggested a few concrete proposals for dealing with specific aspects of the developing crisis. But he never worked out, initiated, or carried through a fresh approach which combined necessary domestic changes with a fundamental re-evaluation of American foreign policy. He did not resolve the dilemma. At the time of his death, he was turning back toward the inadequate domestic programs of the New Deal era, and was in foreign affairs reasserting the traditional strategy of the Open Door Policy.

Explorations into the forest of conditional history are sometimes fruitful, for they occasionally suggest new insights into what did occur. This is perhaps the case with the debate over what would have happened if Roosevelt had lived. The most sympathetic interpretation explains Roosevelt’s ambivalence as a result of his declining health. That was a relevant consideration, but there is little evidence that Roosevelt seriously entertained even the idea of initiating a re-evaluation of America’s conception of itself and the world. For the further such an inquiry is pushed, the more it becomes apparent that Roosevelt had not abandoned the policy of the open door; and that, even if he personally had been on the verge of trying to do so, few of his advisors and subordinates had either the intention or the power to effect such a change.

The leaders who succeeded Roosevelt understood neither the dilemma nor the need to alter their outlook. A handful of them thought briefly of stabilizing relations with the Soviet Union on the basis of economic and political agreements, but even that tiny minority saw the future in terms of continued expansion guided by the strategy of the Open Door Policy. The great majority rapidly embarked upon a program to force the Soviet Union to accept America’s traditional conception of itself and the world. This decision represented the final stage in the transformation of the policy of the open door from a utopian idea into an ideology, from an intellectual outlook for changing the world into one concerned with preserving it in the traditional mold.

American leaders had internalized, and had come to believe, the theory, the necessity, and the morality of open-door expansion. Hence they seldom thought it necessary to explain or defend the approach. Instead, they assumed the premises and concerned themselves with exercising their freedom and power to deal with the necessities and the opportunities that were defined by such an outlook. As far as American leaders were concerned, the philosophy and practice of open-door expansion had become, in both its missionary and economic aspects, the view of the world. Those who did not recognize and accept that fact were considered not only wrong, but incapable of thinking correctly.

The problem of the Soviet leaders was defined by the confrontation between the expansive prophecy of Marx about world revolution (which was supported by the traditional Great Russian and Slavic ideas of world leadership) and a realistic, Marxian analysis of world conditions (which was reinforced by sober calculations of nationalistic self-interest). Russian leaders clearly recognized their dilemma, and realized that rehabilitation and military security were the points upon which its resolution had to hinge. But American policy offered the Russians no real choice on those key issues. Particularly after the atom bomb was created and used, the attitude of the United States left the Soviets with but one real option: either acquiesce in American proposals or be confronted with American power and hostility. It was the decision of the United States to employ its new and awesome power in keeping with the traditional Open Door Policy which crystallized the cold war.

To say that is not to say that the United States started or caused the cold war. Nor is it an effort to avoid what many people apparently consider the most important—if also the most controversial and embarrassing—issue of recent and contemporary history. For, contrary to that general belief, the problem of which side started the cold war offers neither a very intelligent nor a very rewarding way of approaching the central questions about American foreign relations since 1941.

The real issue is rather the far more subtle one of which side committed its power to policies which hardened the natural and inherent tensions and propensities into bitter antagonisms and inflexible positions. Two general attitudes can be adopted in facing that issue. One is to assume, or take for granted, on the basis of emotion and official information, that the answer is obvious: Russia is to blame. That represents the easy, nationalistic solution to all questions about international affairs. That attitude also defines history as a stockpile of facts to be requisitioned on the basis of what is needed to prove a conclusion decided upon in advance.

The other approach is to consider history as a way of learning, of mustering the intellectual and moral courage to acknowledge the facts as they exist without tampering with them. If they are unpleasant or disturbing, then new facts—in the form of our ideas and actions—must be created that modify the unsatisfying scene. This is the more difficult and the more demanding method. Recognizing this, John Foster Dulles offered in 1946 a classic bit of encouragement to push on with the effort: “There is no nation which has attitudes so pure that they cannot be bettered by self-examination.” ^*

In undertaking such self-examination, the first and essential requirement is to acknowledge two primary facts which can never be blinked. The first is that the United States had from 1944 to at least 1962 a vast preponderance of actual as well as potential power vis-à-vis the Soviet Union.^† Nothing can ever change the absolute and relative power relationship between the two countries during that chronological period. This relative weakness of the Russians did not turn them into western parliamentary democrats, and it did not transform their every action into a moral and equitable transaction. But it does confront all students of the cold war, be they academicians or politicians or housewives, with very clear and firm limits on how they can make sense out of the cold war if they are at the same time to observe the essential standards of intellectual honesty. For power and responsibility go together in a direct and intimate relationship. Unless it tries all the alternatives that offer reasonable probabilities of success, a nation with the great relative supremacy enjoyed by the United States between 1944 and 1962 cannot with any real warrant or meaning claim that it has been forced to follow a certain approach or policy. Yet that is the American claim even though it did not explore several such alternatives.

Instead, and this is the second fact that cannot be dodged, the United States used or deployed its preponderance of power wholly within the assumptions and the tradition of the strategy of the Open Door Policy. The United States never formulated and offered the Soviet Union a settlement based on other, less grandiose, terms. For that matter, it never made a serious and sustained effort even to employ in dealing with the Russians the same kind of tactics that had been used for a generation before World War II in relations with the Japanese.

It is true that the offer to include the Soviet Union in the Marshall Plan can be interpreted as a similar move. For, if the Soviets had accepted the conditions set forth for receiving such assistance, the United States would have been in a position to exercise extensive influence over internal Soviet affairs, as well as over its foreign policy. To cite but one known example, American leaders would have demanded that the Russians allocate large quantities of raw materials to western Europe. That in itself would have delayed and complicated Soviet recovery, let alone its further development.^‡ Even so, American policy-makers greeted the Russian refusal to participate on such terms with an audible sigh of relief. They never made the kind of serious effort to negotiate a satisfactory compromise with the Russians as they had done with the Japanese. If it be objected that the effort would have failed anyway because it had not worked with the Japanese, then those who advance that argument must go on to confront one of three conclusions that are inherent in their logic. It must be admitted either that the strategy itself cannot succeed without war, or that it can succeed without war only if the other country accepts and works within limits set by the United States. Otherwise, the policy must be changed—formally or informally.

Instead of being changed, however, the traditional strategy was merely reasserted and put into operation at the end of the war under the famous and accurate phrase about “negotiation from strength.” But negotiation from strength meant in practice that there would be no meaningful negotiations. The concept defined negotiation as the acceptance of American proposals, and American leaders acted upon that definition. The broad and fundamental failure of the policy demonstrated the basic misconception of man and the world inherent in the policy of the open door. For it established beyond cavil that the policy of the open door, like all imperial policies, created and spurred onward a dynamic opposition to which it forfeited the initiative. Not even a monopoly of nuclear weapons enabled America to prove itself an exception to that involuting momentum of empire.

Even before they formally entered World War II, American leaders assumed that the United States would emerge from the conflict in a position to extend, stabilize, and reform the empire of the open door. Roosevelt’s assumption that Anglo-American forces would police the world for a “transition period” after the defeat of the Axis was given overt expression in August 1941. That was almost four months before Pearl Harbor but after the decision had been made to help the Russians defeat Hitler in Europe. His casually optimistic outlook foresaw the ultimate creation of an international organization committed to the policy of the open door, a circumstance that would enable the United States to proceed with the work of developing the world.

Supported by a thoroughly bipartisan assortment of liberals and conservatives, this reassertion of the traditional open door strategy guided the community of American policy-makers throughout the war and on into the cold war era. Ultimately it became, in the best tradition of the open door, and in the words of G. L. Arnold, a sympathetic British observer, a view of the world resting “upon the expectation of a prolonged era of peace, Anglo-American hegemony (with the aid of China) in the United Nations and in the world generally, free trade outside the Soviet orbit and gradual liberalization within, a weakened and profoundly pacific Russia far behind the Western powers in the utilization of atomic energy.” The assumption of virtuous omnipotence, implicit in the Open Door Notes and formulated explicitly on the eve of American entry into World War I, reached full maturity in that image of an American Century. As with Theodore Roosevelt’s concern to save civilization and Wilson’s crusade to make the world safe for democracy, however, the urge to give the future a New Deal was powered by a persuasive sense of the necessity to expand economically in order to sustain democracy and prosperity in the United States.

In keeping with this outlook, the United States declined in the winter of 1941–42 even to consider the Soviet Union’s bid to settle the postwar boundaries of eastern Europe on the basis of the situation as it existed just prior to Hitler’s attack.^§ Russia raised the question in conversations with the British during November and December 1941, at which time Soviet spokesmen made clear and pointed references to being left out of the Atlantic Conference discussions of August 1941, between Churchill and Roosevelt.

Stalin suggested five major areas for agreement: (1) the boundaries of the Soviet Union should be guaranteed largely as they existed just prior to Hitler’s assault in June 1941 (including the Curzon Line in Poland); (2) Austria should be restored as an independent nation; (3) Germany’s industrial and military base should be weakened by splitting off the Ruhr manufacturing complex, by incorporating East Prussia into Poland, and perhaps by breaking off one other large province; (4) Yugoslavia and Albania should be re-established as independent countries, and Czechoslovakia and Greece should have their prewar boundaries reaffirmed; and (5) Russia should receive reparations in kind from Germany.

These proposals pose a fascinating “iffy” question: what if Russia had been committed to those conditions, and they had been honored by both sides? Certainly the postwar era would have developed in a significantly different manner. Another consideration is more relevant to what did happen, because the Soviets continued in large measure to emphasize their proposals of 1941 during the war and on into the subsequent period.

At the time, however, the American response was wholly negative. Hull considered it “unfortunate” even to discuss such “commitments,” and simply refused to agree to them. He first put strong pressure on the British to delay and then spurn the Soviet offer. There is no mystery about his adamance. American leaders did not want to negotiate any settlements until they were in the strongest possible position, and they thought that would be at the end of the war. And they were guided by the Open Door Policy, and they had neither the desire nor the intention to negotiate away any equality of opportunity in eastern Europe.

Stalin nevertheless continued to press his proposals during discussions with Anthony Eden in Moscow in December 1941, and on into 1942. Hull never gave way. He secured Roosevelt’s support in April 1942, for the view that such commitments were “both dangerous and unwise.” A month later the Secretary and his advisors in the State Department prepared a protest “so strong that we were in some fear lest the President disapprove it.” The concern was unfounded. Roosevelt, so Hull reported, “quickly returned it with his O.K.” The Soviets were blocked. The postwar configuration of eastern Europe was left moot—to be settled by other means.

This episode was extremely significant in American-Soviet relations, and English and American leaders realized that at the time. In many ways, the crisis can be understood most clearly in terms of the paradoxical attitude of the United States toward the Baltic States. Before World War I, Estonia, Latvia, and Lithuania had been provinces of Russia. Then, at the time of the Bolshevik Revolution, Germany had forcibly annexed them. During the subsequent years of intervention, the Allies encouraged and finally established the three countries as part of the cordon sanitaire designed to contain the Soviet Union.

Acquiescing in, but not accepting, that loss of its traditional “window on the West,” the Soviets signed peace treaties with the new states in 1920. But the United States did not recognize the independence of those nations for several years, insisting that they were legitimate parts of the Russian state. Ultimately, however, America gave way and established diplomatic relations with the three countries. Having re-established its traditional authority over the Baltic states in 1939, the Soviet Union fully expected and intended to retain that control after the defeat of Hitler. In the discussions that took place during the winter of 1941–1942, however, the United States refused to return to its original position. Stalin’s blunt reaction to being blocked on this issue by Hull and Roosevelt (and thereby the British) casts an exceedingly bright light on subsequent tension between East and West.

“It is very important to us,” Stalin explained at the outset of the negotiations, “to know whether we shall have to fight at the peace conference in order to get our western frontiers.” ^¶

The record of the discussions reveals that the Russians became convinced that such a battle would be necessary.

“Surely this is axiomatic,” Stalin shot back when Eden continued, as the advance guard for Hull and Roosevelt, to balk at an agreement. “We are fighting our hardest and losing hundreds of thousands of men in the common cause with Great Britain as our ally, and I should have thought that such a question as the position of the Baltic states ought to be axiomatic .  .  . . [I] am surprised and amazed at Mr. Churchill’s Government taking up this position. It is practically the same as that of the Chamberlain Government . .  .  . This attitude of the British Government toward our frontiers is indeed a surprise to me so I think it will be better to postpone the proposed agreements.”

“It now looks,” he added in a remark that implicitly tied Roosevelt and the United States to the British position, “as if the Atlantic Charter was directed against the U.S.S.R.” Stalin was of course aware of America’s responsibility for preventing an agreement. Any doubts are removed by Eden’s blunt summary of the whole affair. The American attitude, he warned on March 12, 1942, “will surely appear to Stalin so uncollaborative a state of mind as to confirm his suspicions that he can expect no real consideration for Russia’s interests from ourselves or the United States.”

Roosevelt took an almost identical position three years later, in the fall of 1944, when the issue was reopened by the Russian counteroffensive against Hitler. The British repeated their warning about the dangers inherent in Roosevelt’s efforts to avoid a commitment: the Russians were on the scene, and the only possible way of sustaining Western interests was through serious negotiations based on a series of quid pro quos. Instead, Roosevelt and Hull again stood by the strategy of the open door. They insisted that any agreement between Stalin and Churchill would have to be limited to a period of three months duration. It seems very probable that Stalin concluded that he would “have to fight at the peace conference in order to get our western frontiers.”

In the meantime, the refusal to negotiate a basic settlement with the Soviet Union in the winter of 1941–1942 was almost immediately followed by another serious difference between the two countries. For, later in the spring of 1942, the Russians were given ambivalent and confusing assurances about when a second front would be opened in Europe. By August, when it had become apparent that Allied troops would not land on the continent that year, relations with Moscow had encountered very rough sledding. Even so, several developments reduced the tension and produced an interlude of improved relations between America and Russia. Foremost was the Russian victory at Stalingrad. That triumph convinced everybody, including the Russians, that Hitler would be defeated. As a result, and even before they launched their major counter-offensive, the Soviets embarked upon a fundamental debate over what to do after the war. Their discussions ranged across political, philosophical, and economic lines, but its essential nature was defined by Russia’s tremendous physical and human losses in the war.

After Stalingrad, the Russians knew they would survive, but as a terribly weakened nation. Hence they were aware that the way they handled the recovery problem would influence all other decisions. Perhaps the most revealing insight into Russia’s basic outlook at that time was offered (unconsciously, in all probability) by Molotov on February 18, 1956—after the Soviets had developed their nuclear weapons, and after the Chinese Communists had triumphed in Asia. “We now have an international situation,” he remarked, “of which we could only have dreamed ten or fifteen years ago.” Implicit in Molotov’s comment was the fact that the Russians had viewed their position in the 1940s as one of weakness, not offensive strength.

Though there were various shades of opinion as to how the central issue of reconstruction should be dealt with, the Russians divided into three broad groups. One of them, occasionally called “our softies” by their Russian opponents, held that it was necessary and desirable to undertake reconstruction at a relatively moderate tempo, obtaining assistance from the United States. The softies stressed the need and desirability of relaxing the pervasive and extensive controls that had been exercised over Soviet life ever since the first Five Year Plan and the wisdom of revising, decentralizing, and rationalizing the industrial system that had been built. They also emphasized the danger of deteriorating relations with the United States. Perhaps most significant of all, they advanced the thesis that Western capitalism could probably avoid another serious depression, and hence the appeal and the safety of the Soviet Union depended upon its ability to improve the quality of life in Russia and thereby induce other peoples to accept communism by the force and persuasiveness of example.

Others within Russia argued that the softies were wrong in theory or in fact. Some of these men, who may be called the conservatives, agreed with the softies that it was desirable to ease up at home and were half convinced by the more favorable analysis of foreign capitalism, but they doubted that the Western nations, and in particular the United States, would help the Soviet Union solve its reconstruction problems. Hence they concluded that Russia would have to establish a basic security perimeter in Europe, the Middle East, and Asia and once again pull itself up by its own bootstraps.

Opposed to the softies and the conservatives was a group which may be called the doctrinaire revolutionaries. The diehards scoffed at the analysis and proposals advanced by the moderates and asserted that the only practical and realistic program was to secure a base for militant revolutionary activity throughout the world. Such doctrinaires stressed the need to force the pace of reconstruction while doing all that was possible to export revolutions.^#

Stalin’s temperament and experience inclined him toward resolving the dilemma posed by the problem of reconstruction and the tradition of revolution in a conservative manner. But that approach depended on two things for success: (1) limiting and controlling revolutionary action by foreign communists, which otherwise would antagonize the United States, and (2) reaching an economic and political understanding with America, an agreement that would enable Russia to handle the problem of recovery and at the same time relax certain controls and pressures inside the country. To use the language of Wall Street, Stalin was a bull on communism. He was confident that if given a peaceful opportunity to develop its program in Russia, communism would gradually appeal to more and more countries of the world. He felt this was particularly likely in the underdeveloped areas and in poorer industrialized nations. If this could be managed by getting aid from America and by restraining foreign Communists from seizing power through revolutions, then the movement toward socialism and communism would move slowly enough to avoid frightening the United States into retaliation against the Soviet Union itself.

Two important aspects of this ferment and clash of views within the hierarchy of Soviet leadership have to kept in mind throughout any discussion of American-Soviet relations after 1941. They are particularly important to an understanding of the interaction between the two countries during the period between April 1945 and the summer of 1948.

The first is that this conflict over policy within the Soviet Union cannot be discounted or dismissed on the grounds that it did not produce Western-style representative government in Russia. Both the American public in general and its individual leaders tend very strongly to interpret the absence of Anglo-Saxon institutions in another country to mean that there is also an absence of significant or meaningful disagreement and debate about important issues. This is simply wrong. The ways in which differences of interest and opinion are organized and exert influence are many and varied. Even in the United States, for that matter, many crucial issues came increasingly after 1929 to be debated and decided by an elite almost wholly outside the institutions of local, state and national elections. Furthermore, as events since 1952 have demonstrated, such debate in Russia did continue and did begin to take on institutional form and substance. It also affected policy.

This development leads directly to the second main point. American policy exerted an early, continuing, and significant influence on the course of debate in the Soviet Union. Indeed, it had done so since the very first weeks of the Bolshevik Revolution in 1917. American policy therefore influenced Soviet policy and action. These considerations can not be re-emphasized every time they appear in the subsequent pages of this essay, but it is extremely important to understand them and use them as intellectual tools in thinking about later events.

In order to bypass all the misunderstanding that it is possible to avoid, let these points be stated as simply and as directly as possible. As Stalin made clear in the winter of 1941–1942, the Soviet Union fully intended to re-establish what it considered to be its minimum natural and desirable frontiers in eastern Europe. He further concluded that the United States and England would resist that effort. His opposition raised in the minds of Soviet leaders the very natural question as to whether or not they did not need an even firmer security perimeter.

Hence the problem for American leaders was one of developing an attitude and a broad set of proposals involving such security and economic aid for the Soviet Union that would enable them to negotiate some kind of modus vivendi with the Russians. The failure of American leaders to do that is the central theme of American diplomacy after the abortive negotiations of 1941–1942. If studied and written as a critique of Soviet policy, the emphasis involved in treating these matters would be different. In that case, the story might very well focus on the way that the breakdown of the talks of 1941–1942 strengthened those Soviet leaders who laid primary stress on extending communism as the Red Army moved westward. That might very possibly be the real tragedy of Soviet diplomacy. But since this essay is about American diplomacy, and—even more—since it was the United States that refused to offer any clear and unequivocal basis for such fundamental negotiations, the essay has to concentrate on America’s actions and the ideas behind them.

Returning, then, to the events of the winter of 1942–1943, there were several developments which encouraged Stalin in his propensity to resolve his dilemma in a conservative (i.e., nationalist) fashion. One was the Western landing in North Africa, which did apparently modify his suspicion and anger over the failure to make an assault on the European continent. More important, however, was an American approach concerning postwar economic relations with Russia which seemed to suggest that the Soviet Union could obtain help in dealing with its reconstruction problems. Stalin responded quickly and decisively. But he was ultimately forced to conclude that the American overture did not represent a changed outlook on the part of the majority of America’s corporate leaders.

In its origins the plan was a continuation of the old idea that America’s economic system had to have a constantly expanding foreign market if it was to survive and prosper. At bottom, therefore, it was the fear of another depression (or the resumption of the old one) that prompted a few American leaders such as Donald M. Nelson and Eric Johnston to think of large-scale exports to Russia. Johnston, for example, was convinced after careful investigation in 1944 that the primary concern of Soviet leaders was “to rebuild Russia.” They also worried about the depletion of certain raw materials and thought that Russia could continue to supply such items as manganese after the war. This small minority of American leaders began to realize that, whatever his many faults, Stalin was not another Hitler and that the Soviet Union had not developed by the same dynamic as Nazi Germany.

During 1943, therefore, Nelson and a few other Americans pushed the idea of a large loan to Russia. Stalin told Nelson that he was very much in favor of the plan and even gave him a list of priority needs as a first step in working out a specific program. Their negotiations had much to do with the improvement, in political relations between the two countries, exemplified by Stalin’s voluntary promise to Secretary of State Hull in October 1943 that Russia would enter the war against Japan. A bit later, in November, the conversations at the Teheran Conference also reflected the improved atmosphere.

For his part, Roosevelt was by that time revealing a more realistic attitude about including the Soviet Union as a full partner in any plans for the postwar world. He did not talk any longer, for example, about the way that England and America would between themselves police the world at the end of the war. In a similar way, he apparently grasped the fact that Stalin was “most deeply interested” in Russian recovery problems, and indicated at least some recognition of the way that issue was tied in with Soviet foreign policy. The President also seemed to be gaining some awareness that more reforms were needed in the United States. He talked, at least to some extent, about the importance of an “economic bill of rights” to balance, supplement, and reinforce America’s traditional political freedoms. In certain respects, he appeared to be echoing the argument of the speech he had read at the Common-wealth Club in San Francisco during the 1932 presidential campaign. “America’s own rightful place in the world,” he asserted, “depends in large part upon” its handling of domestic issues. “For unless there is security here at home,” he explained, “there cannot be lasting peace in the world.”

Such remarks can be interpreted to mean that Roosevelt was beginning to understand that America’s traditional policy of open-door expansion had contributed significantly to its domestic and international difficulties. Even so, his concrete proposals for development at home were pale copies of old New Deal legislation. And while he said he was “sorry” that he did not have time to discuss Russia’s postwar recovery problems with Stalin at Teheran, the fact is that he never took—or made—time to do so during the remaining sixteen months of his life. He did not even see to it that his subordinates committed and prepared themselves to discuss and negotiate the issue with the Soviets. Roosevelt’s declining health may account in part for this, but in that event it is clear that such an approach to the Russians was very low on the President’s list of priorities.

There is at least one account, moreover, which suggests that Roosevelt’s position was very similar to those who wanted to use Russia’s needs to win major political and economic concessions. The story is told by James Byrnes in his second volume of memoirs, All In One Life. He reports that Leo Crowley, who was to terminate Lend-Lease shipments to the Soviet Union as soon as Germany surrendered, told him of a conversation with Roosevelt that took place about April 1, 1945, shortly before the President died. “Crowley told me that .  .  . he told the President about a rumor that our government was considering a loan to the Soviets of $10 billion, and that he [Crowley] thought it wise to refrain from making any loan until more was known of their postwar attitude. He said the President agreed.” This account should not be taken as full proof of Roosevelt’s attitude. But it does, even when evaluated with caution, support the main point at issue. It is simply not possible to account for the continuance of the Open Door Policy by blaming Roosevelt’s successors, for the President did not carry through on persistent Russian overtures for major economic assistance to help them rebuild their shattered economy.

Had Roosevelt done this, it would be more meaningful to charge his successors—or the Russians—with sabotaging his plan for the future; for it is quite true that the small group around Nelson favoring some rapprochement with the Russians was opposed by a much larger number of America’s corporate leaders. It seems likely that Averell Harriman, one of the many wealthy industrial and banking leaders who supported Roosevelt, and who was one of the President’s top advisors, was one of the more influential leaders of the anti-Russian group. Harriman’s natural antagonism to the Soviets was reinforced by his vigorous belief in the necessity of open-door expansion, a belief that may have been heightened even more by an unhappy experience with the Russians in the 1920s, when his attempt to control a sizable segment of the world’s manganese market by developing Russian supplies ended in mutual dissatisfaction. Harriman was but one of many corporate leaders, however, who had gone into the Roosevelt Administration with anti-Russian views. Others included James B. Forrestal and Bernard Baruch. All of these men were skeptical of Nelson’s approach to dealing with the Soviets and were supported in their view by State Department experts such as George F. Kennan (who was in Russia much of the time with Harriman).

These men shared Harriman’s extremely reserved reaction, early in 1944, to the news that the Russians “were anxious to come to a prompt understanding” about postwar economic relations. His view became even clearer when, a bit later that year, Stalin made a formal request for a loan of six billion dollars. Harriman advised cutting the initial amount under discussion to one-tenth of that sum and proposed that the project should be defined as a credit, rather than as a loan, so that if it ever actually went through, the United States could exercise extensive controls over Russia’s use of the money. Thus, while he agreed with the Nelson group that “the question of long-term credits represents the key point in any negotiations with the Soviet Government,” he also shared the State Department’s view that the lever provided by Russian weakness and devastation could and should be used to insure a predominant role for America in all decisions about the postwar world.

Harriman and most American leaders knew precisely what kind of choice they made. One of the most unequivocal pieces of evidence on this point comes from Admiral William H. Standley, who served as American Ambassador to Russia during the first part of the war. Speaking publicly on November 14, 1944, he offered a candid review of the situation. Some kind of rivalry with the Russians was unavoidable simply because they would be the only other victorious power on the continent of Europe. But that tension could be kept within bounds, Standley argued, if the United States accepted its primary responsibility in the situation.

“We must assume two important premises,” he pointed out. “First, that Russia’s security is vital to her and that she cannot turn to industrialization and development of her raw material resources unless she has that security .  .  . . After victory, security is their next consideration .  .  . . [And unless we help establish it] they will have to proceed on their own to provide it.”

Harriman based his policy on an identical analysis. He candidly acknowledged “that the sooner the Soviet Union can develop a decent life for its people the more tolerant they will become.” That interpretation obviously implied a basic policy of helping the Russians recover from the devastation of the war. But quite unlike Standley, Harriman proposed instead to exploit Russian weakness and force them to accept American policies. The Russians “should be given to understand that our willingness to co-operate wholeheartedly with them in their vast reconstruction problems will depend upon their behavior in international matters.” “I am opposed to granting her that credit,” he stated flatly in May 1945. “I would apportion that credit out piecemeal, demanding in return concessions on the political field.”

From the very beginning of the discussions with Stalin in 1943, Roosevelt was aware of the Soviet overtures for economic aid and of the importance Stalin attached to such negotiations. Yet the President never took the lead himself in handling the issue. Nor did he direct the State Department or a special committee to push the matter. In the end, therefore, there was no concerted American effort to match the Russian approach of handling related political and economic questions on an integrated basis.^**

Roosevelt’s attitude, which so clearly reflected the traditional outlook of the Open Door Policy, was revealed even more vividly in the spring of 1944, when the Soviet Army began to advance into eastern Europe. Confronted by Churchill with the need to come to some clear arrangement with the Russians, Roosevelt at first agreed to the idea of a clear and precise division of authority. Then, in an abrupt turnabout, he asserted that he must have “complete freedom of action,” whatever the agreement arranged by Churchill and Stalin. After considerable effort, Churchill and Stalin worked out an understanding—“a good guide,” said Churchill, “for the conduct of our affairs”—whereby Russia would exercise predominant authority in southeastern Europe, Great Britain would do so in Greece, and the Allies would share responsibility in Yugoslavia. Roosevelt reluctantly accepted this division of power on the basis of a three-month trial.

During subsequent months, the British intervened to crush a revolution in Greece and prepare the way for the installation of a government they wanted and could control. Though he urged the British to take a more liberal line, Roosevelt went along with Churchill on the need to control affairs in Greece and acquiesced in the Prime Minister’s action. Both in fact and in the eyes of the Russians, that committed Roosevelt on the eve of the Yalta Conference to the agreement worked out between Churchill and Stalin. For his part, Stalin refrained from attacking or blocking the British move in Greece. Churchill reported that Stalin “adhered very strictly to this understanding.” Stalin also moved to forestall trouble with the Western Allies arising from foreign communist agitation and revolution. He advised, and apparently even warned, Tito and Mao Tse-tung to abstain from revolutionary action in their nations and instead to accept subordinate positions in coalition governments led by pro-Western parties.

Against this background, and in the context of Germany’s imminent defeat, Roosevelt met Churchill and Stalin at Yalta in February 1945. In addition to their knowledge of the Churchill-Stalin agreement, and of Stalin’s self-containment during the Greek episode, American leaders were aware that the Chinese communists, after a long debate, had concluded in September 1944, that they preferred to work with the United States rather than with Russia in the future development of China. Thus it is absolutely clear that Roosevelt and his advisors knew that the Soviet Union was prepared to negotiate seriously about the character of postwar relations with the United States and that America had an equally fruitful opportunity in Asia. But during the conference American leaders were not concerned to push such negotiations. They were not prepared to abandon, or even seriously to modify, the traditional strategy of American expansion.

Disturbed by America’s ambivalence and Churchill’s increasingly open opposition, which increased the difficulty Stalin had in controlling the doctrinaire revolutionaries within his own camp, Stalin went to Yalta with two approaches to the postwar world. One was based on receiving a large loan from the United States. His overtures in this direction were answered with vague and unrewarding replies. Stalin’s alternative was to obtain, by agreement or by self-exertion, economic reparations from Germany and a strong strategic position in eastern Europe, the Black Sea area, and the Far East. America went to Yalta, on the other hand, guided by little except a sense of mission to reform the world, a growing fear of postwar economic crisis, and an increasing confidence that Russian weakness would enable America to exercise its freedom and solve its problems by further open-door expansion.

Commentators have criticized President Roosevelt very severely on the grounds that he was naive in believing he could persuade Stalin to co-operate with the West after the war. Such attacks are weak and misdirected in several important respects. In the first place, it is almost absurd to think—or charge—that a man with Roosevelt’s mastery of political infighting was naive. He may have overestimated his power or his skill, but he was not naive. Significantly, too, Roosevelt had not abandoned, at the time of his death, the intention of reasserting American power and influence in eastern Europe. It was suggested to him that the United States should file a vigorous protest over the Soviet action early in 1945 of reconstituting the Rumanian Government along pro-Soviet lines. Roosevelt did not reply that the basic issue should be forgotten. His position was quite different. He said merely that the Rumanian episode, because it involved supplies for the Red Army that was still fighting Germany, did not offer the best kind of ground upon which to take a stand.

Roosevelt’s idea of reaching an accommodation with Stalin was not based on some utopian dream of perfect and everlasting agreement on any and all issues. However, Roosevelt simply did not understand the nature and workings of a modern, complex industrial economy. The result in domestic affairs was that his political acumen and skill were never focused on the central and vital issues of getting the political economy into some kind of fundamentally dynamic balance. The same weakness plagued him in dealing with the Russians. He never got his priorities straight. Short of war, economic aid was the one effective tool he had in negotiations with the Soviets. But he never used it

Roosevelt’s successors understood and used that lever, but they treated it as a weapon to force the Soviets to accept American policies. The conflict over affairs in eastern Europe which developed out of that attitude is usually stressed in discussing the origins of the cold war. Yet it may be that the issues of German reparations and American expansion in the Middle East were equally important as determining factors. Failing to obtain a loan from America, Stalin had to decide among three possible courses of action.^††

He could give way and accept the American interpretation of all disputed points, abandoning foreign communists to their fate and attempting to control the extremists in his own nation. He could respond with an orthodox revolutionary program throughout the world. Or, relying on large economic reparations from Germany, he could continue the effort to resolve his dilemma in a conservative manner even though he did not have any formal understanding with the United States. This approach would also do much to keep Germany from becoming a threat to Russia in the immediate future. It left him, however, with the need to effect some basic settlement concerning eastern Europe, the Far East, and the Black Sea region.

Stalin was able to reach such an understanding with the United States in but one of those areas. This was in Asia, where he traded American predominance in China (and Japan) for strategic and economic rights in Manchuria. Concerning eastern Europe, however, Stalin accepted an ambivalent proposal on the Polish issue which represented America’s unwillingness to acknowledge his agreement with Churchill as much as it did Russia’s security needs. He was no more successful in the Middle East, where American oil companies had moved back into Iran in 1943. Supported by the State Department and special emissaries, the companies were well along in their efforts to obtain extensive concessions. Roosevelt was “thrilled” by the chance to work along with the oil companies and make Iran an example of what America could do for underdeveloped areas of the world, an attitude which helps explain why the United States was not willing to allow the Russians to obtain oil rights in northern Iran. Stalin gave way on the issue at Yalta and also refrained from pushing his desire to gain more security for Russia in the Black Sea area.

Despite his failure to get any positive response from the United States on the question of a postwar loan, or a clear understanding on other vital issues, Stalin still hoped to effect a conservative resolution of his dilemma. Throughout the first half of 1945, for example, Izvestia stressed the vitality of the American economy (in striking contrast to the fears being expressed in Congressional hearings), emphasized the importance of resolving outstanding issues by negotiation, and reiterated the fruitfulness of economic co-operation. The British press attaché in Russia reported that Soviet comment remained restrained and hopeful until America initiated a campaign of vigorous criticism and protest aimed at Soviet predominance in eastern Europe.

But the most significant indicators of the predisposition to work out some modus vivendi with the United States, and then to concentrate on internal recovery and development, came in the debates within the Soviet hierarchy, and in the relatively restrained policies followed in eastern Europe after the Nazis were defeated. One of the earliest indications of Russian emphasis on domestic affairs appeared in 1943 in the form of a discussion (in the journal Under the Banner of Marxism) over the proper way to teach economics. This took special note, among other things, of Stalin’s praise of the United States. The crucial feature was the heavy stress laid upon the extent of the recovery crisis, and upon the need to concentrate on domestic affairs. Many American observers immediately understood and pointed out the nonrevolutionary implications of the argument, but official policy-makers in the United States took little if any cognizance of the matter.^‡‡

An even more revealing debate occurred after the publication in 1946 of a major study of capitalism by the Soviet economist Eugene Varga. The date of 1946 is significant in two respects. It means, in the first place, that the discussion had been going on at least since 1944, a consideration which underscores the ambivalent, undecided, and cautious nature of Soviet thinking at the end of the war. It also indicates that the Russians had not made a firm decision on their basic approach as late as 1946; even though, as will be seen, the United States had been exerting strong pressure on the Soviet Union ever since the London Foreign Ministers’ Conference in September 1945.

Varga’s central point was that capitalism in general, and in the United States in particular, was capable of stabilizing itself in the postwar era. He went on to argue that the role of the government could be positive and creative under capitalism, and in that fashion suggested that the classic Marxian prophecy about the inevitable collapse of capitalism might need to be revised and modified. Varga’s argument pointed very directly toward the need to stabilize relations with the United States, and to concentrate on domestic Soviet development.^§§

These examples point up a very important kind of continuity in Soviet affairs that is often missed or forgotten. The revisionist debate that erupted within and between communist countries in the mid-1950s was actually no more than a continuation of the discussion that began in 1943–44 within the Soviet Union, and which was pursued very vigorously as late as 1947 and 1948. The two illustrations mentioned here should not be taken as isolated, atypical events. Early in 1945, for example, a very long and strongly argued revisionist article appeared in the magazine Foundations of Marxism. Similar debates took place around short stories and novels. And the philosopher Aleksandrov, who had good things to say about Western capitalist thinkers, was in high favor as late as the first months of 1947.^¶¶ The popular idea that Soviet leaders emerged from the war ready to do aggressive battle against the United States is simply not borne out by the evidence. Varga himself was not attacked in public in any serious way, for example, until after Winston Churchill’s militant Iron Curtain speech in 1946, and the enunciation of the Truman Doctrine in March 1947.

Soviet officials who later chose to live in the West often offered the same kind of evidence bearing on Russian policy at the end of the war. One of the American experts who interviewed many such men offered this general judgment about Soviet policy in Germany. “The paramount consideration was not the extension of the revolution to Germany and the establishment of a Soviet Government there, but the rehabilitation of the Soviet Union’s war-ravaged industry and transportation .  .  . regardless of the effect this policy might have on .  .  . establishing a Soviet Germany.” For that matter, the Red Army’s railroad lines across Poland into Germany were ripped up in 1945. And in eastern Europe, the Soviet approach was modeled on the popular front governments of the 1930s rather than upon the existing Soviet system.^##

The point of these examples (and there are many more) is not to suggest, let alone try to prove, that Stalin and other Soviet leaders behaved either as Western democrats or as men uninterested in exercising influence in eastern Europe. The point is to indicate and to stress the importance of three quite different things; first, the very significant extent to which Soviet decisions from 1944 through 1947 were based on domestic Russian conditions; second, the degree to which the Soviets were assuming that capitalism would stabilize itself around the great and undamaged power of the United States; and third, the way in which those two factors pointed in the mind of many Russians—including Stalin—to the need to reach some kind of agreement with America. They never defined such an understanding on the basis of abandoning Russian influence in eastern Europe or acquiescing in each and every American proposal just as it first emanated from Washington. But neither did they emerge from World War II with a determination to take over eastern Europe and then embark upon a cold war with the United States.

Beginning in 1946, Stalin grew ever more skeptical about the possibility of negotiating any basic understanding with American leaders. But he never became a fatalist about war ,with the United States. And the so-called softies in the party were not finally downgraded, and then subjected to vigorous and extensive attacks (including imprisonment) until the late summer and early fall of 1947. It was not until even later that the Soviet Union moved ruthlessly to extend and consolidate its control over eastern Europe.

II.THE OPEN DOOR POLICY AND THE ONSET OF THE COLD WAR

Stalin’s effort to solve Russia’s problem of security and recovery short of widespread conflict with the United States was not matched by American leaders who acceded to power upon the death of Roosevelt. The President bequeathed them little, if anything, beyond the traditional outlook of open-door expansion. They proceeded rapidly and with a minimum of debate to translate that conception of America and the world into a series of actions and policies which closed the door to any result but the cold war.

The various themes which went into America’s conception of the freedom and the necessity of open-door expansion, from the doctrine of the elect to the frontier thesis, had been synthesized into an ideology before Roosevelt’s death. Once it was frozen into ideology, it became very difficult—and perhaps artificial, even then—to assign priorities to its various facets. Even a single man, let alone a group, emphasized different themes at various times. Yet the open-door outlook was based on an economic definition of the world, and this explanation of reality was persistently stressed by America’s corporate leadership as it developed its policy toward the Soviet Union and other nations. It was not the possession of the atomic bomb which prompted American leaders to get tough with Russia but rather their open-door outlook which interpreted the bomb as the final guarantee that they could go further faster down that path to world predominance.

Long before anyone knew that the bomb would work, most American leaders were operating on the basis of three assumptions or ideas which defined the world in terms of a cold war. The first specified Russia as being evil but weak. This attitude, predominant among American leaders from the first days of the Bolshevik Revolution in 1917, was reinforced and deepened by the nonaggression pact signed by Russia with Nazi Germany in 1939. There is little evidence to support the oft-asserted claim that Americans changed their basic attitude toward the Soviet Union during the war. Most of them welcomed Russian help against Germany, and some of them mitigated their antagonisms and suspicions, but several careful studies make it clear that large and crucial segments of the American public remained “dubious about the prospects of building the peace together with Russia.”

Even before the end of the war in Europe, many Americans were again comparing Stalin with Hitler and stressing the importance of avoiding any repetition of the appeasement of Nazi Germany. Others, like John Foster Dulles, who had sought persistently and until a very late date to reach a broad compromise with Hitler and Japan, changed their approach when it came to dealing with Russia. They made no such efforts to reach an understanding with Stalin. And by the time of the San Francisco Conference on the United Nations, such leaders as Averell Harriman were publicly expressing their view that there was an “irreconcilable difference” between Russia and the Western powers.

At the same time, however, very few—if any—American leaders thought that Russia would launch a war. Policy-makers were quite aware of the “pitiful” conditions in western Russia, of the nation’s staggering losses and its general exhaustion, of its “simply enormous” need for outside help “to repair the devastation of war,” and of Stalin’s stress on firm economic and political agreements with the United States to provide the basis for that, reconstruction. In their own discussions, American decision-makers drew an astute and crucial distinction between Soviet actions to establish a security perimeter in eastern Europe and an all-out aggressive move against the entire capitalist world. They were right in their estimate that Russia was concerned with the first objective. They were also correct in concluding that the Soviet Union—unlike Nazi Germany—“is not essentially constructed as a dynamic expansionist state.” ^***

Far from emphasizing the imminence of a Russian attack, American leaders stressed the importance of denying any and all Soviet requests or overtures of a revised strategic agreement in the Middle East, and at the same time concentrated on reasserting American influence in eastern Europe while pushing the Russians back to their traditional borders. The first such American action came in the spring and summer of 1945 in the form of protests over Soviet influence that developed as the Red Army moved westward in pursuit of the Nazis. These protests were not prompted by the fear that Russia was about to overwhelm Europe or the world in general, but rather by the traditional outlook of the open door and the specific desire to keep the Soviets from establishing any long-range influence in eastern Europe.

Another basic attitude held by American leaders defined the United States as the symbol and the agent of positive good as opposed to Soviet evil and assumed that the combination of American strength and Russian weakness made it possible to determine the future of the world in accordance with that judgment. One important congressional leader, for example, remarked in 1943 that lend-lease provided the United States with a “wonderful opportunity” to bring the United States to “a greater degree of determining authority” in the world. He was quite aware that his view was “shared by some of the members of the President’s Cabinet” and that important State Department officials were “fully in accord” with the same outlook. Another key congressman was thinking in terms of the “United States seeking world power as a trustee for civilization.” ^††† Following the even earlier lead of publisher Henry R. Luce, who had announced in 1941 that it was high noon of the American Century, various business spokesmen began stressing the need to become “missionaries of capitalism and democracy.” Shortly thereafter, a leading oil-industry leader asserted that America “must set the pace and assume the responsibility of the majority stockholder in this corporation known as the world.” Such remarks were not unique; they merely represented the increasing verbalization of one aspect of America’s traditional policy.

The third essential aspect of the open-door outlook, which also made its appearance before the end of the war, was the fear that America’s economic system would suffer a serious depression if it did not continue to expand overseas. Stressing the fact that there remained roughly nine million unemployed in 1940, one leading New Deal senator warned in 1943 that the danger of another depression could not be overemphasized. A government economic expert promptly supported this view with his own report that “it unfortunately is a fact that for the majority of the people in the United States the thing we have liked to refer to as the American standard of living is only possible in situations where two people in the family are working.”

The reason for this concern, and the extent to which government participation in the financing of such expansion was crucial, is nicely revealed by two sets of statistics. The first figures concern direct exports. In 1928, when the United States enjoyed a net export surplus with every region of the world except some areas in the tropics, the nation sold 17.1 per cent of the world’s exports. Ten years later, during the depression, that share had dropped, despite government loans and subsidies to exporters, to 14.9 per cent. The proportion in 1953, 21.3 per cent, seems at first glance to indicate a dramatic recovery and further gain. But 5.6 per cent of that total was paid for by government loans and grants financed by the American taxpayer. Hence the net share of world exports was only 15.6 per cent. Not until 1956, when it reached 17.9 per cent, did the net figure surpass the American export position of 1928.

The second kind of data concerns the extent to which various American corporations depend upon overseas operations. Total foreign sales, including those of directly owned overseas branches and subsidiaries as well as exports from parent American companies, amounted in 1956 to $58 billion. When classified according to the percentage of total sales accounted for by all foreign operations, the pattern is indicated by the following examples: 75 per cent—Standard Oil of New Jersey; more than 70 per cent—H. J. Heinz and Colgate-Palmolive; over 40 per cent—American Radiator, International Harvester, F. W. Woolworth, Gillette Razor, and National Cash Register; better than 30 per cent—Parke Davis Drugs, Sterling Drugs, and Otis Elevators; and between 15 and 30 per cent—Johnson and Johnson, Corn Products Refining, Firestone, Goodyear, International Business Machines, Coca Cola, and Eastman Kodak.^‡‡‡

The drive to achieve those postwar results began in earnest while the war was still being fought. For his part, Secretary Hull never eased off on the pace he had established in 1933. “The primary object,” he reiterated in 1940, “is both to reopen the old and seek new outlets for our surplus production.” One of his principal concerns was to break into the British trading system, a campaign in which he was vigorously encouraged and supported by American exporters. Hull’s weapons included lend-lease, and Britain’s growing need for a major recovery loan. The United States made its aid conditional upon the acceptance by England of the open-door principle.^§§§

One of the most vigorous proponents of this assault upon the British imperial market was William L. Clayton, a self-made man who became head of the world’s largest cotton export business and then moved into the Roosevelt Administration as a policy-maker. His underlying attitude was very similar to Hull’s: “The international economic policies of nations,” Clayton remarked in 1943, “have more to do with creating conditions which lead to war than any other single factor.” He was committed, as one might expect, to the Open Door Policy as the way to expand exports. Clayton was unusual, however, in that he was considerably more candid than most American leaders when speaking about the nature of that overseas economic expansion. He admitted, for example, that the United States often tried to close the door to competition once it had gone through and established its own position. “As a matter of fact, if we want to be honest with ourselves, we will find that many of the sins that we freely criticize other countries for practicing have their counterpart in the United States.”

Clayton’s comment is particularly relevant to America’s insistence that former Axis colonies, and other trustee territories, should be handled in such a way that the United States would be assured of unrestricted economic access. As Assistant Secretary Sayre explained the policy, it was centered on establishing “sound economic foundations.” “Here again,” he noted, “another distinctively American ideal, expressed at various times as the Open Door Policy, is made a binding obligation in all trust territories.” The remarks of Sayre and Clayton serve to clarify and dramatize one of the issues that plagued American-Soviet relations after 1943. The United States interpreted Russian resistance to the Open Door Policy in eastern Europe as an unfriendly act, even though Stalin acquiesced in the principle throughout the Pacific and elsewhere in the world.

Another policy-maker dramatized this ever-increasing concern with overseas economic expansion by comparing the American system with the old British empire. America, he explained, was “a great island” dependent upon a “greater volume of exports” than even the British had needed in the nineteenth and early twentieth centuries. But what was very probably the clearest and most direct statement and explanation of the American approach to the postwar world was provided in November 1944—five full months before the death of Roosevelt—by Assistant Secretary of State Dean Acheson. Testifying before a special Congressional committee on Postwar Economic Policy and Planning, Acheson analyzed the situation in a remarkable and almost unique outburst of blunt candor. His remarks cast such a dazzling light on American foreign policy ever since that date that they warrant extensive quotation.^¶¶¶

Along with almost every other American leader, Acheson was gravely concerned lest the economy slide back into the depression of the 1930s or collapse in the new debacle at the end of the war. That was the danger, and Acheson repeatedly emphasized it during his entire career in the Department of State.^### If that happened, he began his testimony in 1944, “it seems clear that we are in for a very bad time, so far as the economic and social position of the country is concerned. We cannot go through another ten years like the ten years at the end of the twenties and the beginning of the thirties, without having the most far-reaching consequences upon our economic and social system.”

“When we look at that problem,” he continued, “we may say it is a problem of markets. You don’t have a problem of production. The United States has unlimited creative energy. The important thing is markets. We have got to see that what the country produces is used and is sold under financial arrangements which make its production possible.” The solution, Acheson explained to the Congressmen, was not in doubt. “You must look to foreign markets.”

Acheson then interrupted the main line of his analysis in a curious way. He voluntarily threw in a comment that seems remarkably similar to the admission made by Brooks Adams in 1900, when he was proposing exactly the same kind of expansion. Indeed, the full flavor and import of the episode can only be captured in the give-and-take between Acheson and the chairman of the committee, ^****

ACHESON.    We could argue for quite a while that under a different system in this country you could use the entire production of the country in the United States.

WORLEY.    What do you mean by that?

ACHESON.    I take it the Soviet Union could use its entire production internally. If you wish to control the entire trade and income of the United States, which means the life of the people, you could probably fix it so that everything produced here would be consumed here, but that would completely change our Constitution, our relations to property, human liberty, our very conceptions of law. And nobody contemplates that. Therefore, you find you must look to other markets and those markets are abroad. .  .  . The first thing that I want to bring out is that we need these markets for the output of the United States. If I am wrong about that, then all the argument falls by the wayside, but my contention is that we cannot have full employment and prosperity in the United States without the foreign markets. That is point one, and if anyone wants to challenge me on that we will go over it again.

WORLEY.    I think we are agreed on that.

ACHESON.    How do we go about getting it? What you have to do at the outset is to make credit available. .  .  . I don’t believe private capital can possibly do it.

WORLEY.    Why not?

ACHESON.    I don’t think there is enough private capital willing to engage in that activity, which is quite risky. There will be a lot of losses. .  .  .

As for the significance of the Open Door Policy in this drive for markets, Acheson made that very clear:

WORLEY.    You don’t think there would be a peace agreement without collateral agreements of an economic nature?

ACHESON.    I don’t see how it would work, Mr. Chairman. If we tried to do that it would really mean that we would be relying exclusively on the use of force. I don’t believe that would work.

As the policy developed, however, American leaders did come to rely extensively on the threat of force implied by their short-lived monopoly of the atom bomb, and on the development of conventional forces that were deployed in a long sequence of operations and interventions. That attitude, and the tension it produced in relations with Russia, ultimately provoked strong protests from Secretary of War Stimson and Secretary of Commerce Henry A. Wallace. Prior to their changes, however, both men supported the orthodox line of policy. Deeply concerned about the problem of preventing a depression, Wallace persistently talked between 1943 and 1947 about overseas economic expansion as the new frontier. “Private enterprise in the United States can survive only if it expands and grows,” he argued, and pointed out that he was only trying to help the businessmen do what they themselves advocated. “The old frontiers must be rebuilt,” as he put it, and pointed to American economic expansion into the poor, underdeveloped countries as “this unlimited new frontier of opportunities.” Wallace of course wanted to reform and improve conditions abroad as part of that extension of American enterprise, and was in many respects the epitome of the New Deal version of Woodrow Wilson’s reforming expansionism.

But it is very revealing that Wallace himself spoke favorably of Hoover’s similar desire to improve the lot of the overseas poor as an integral part of extending American business operations. “I have considerable sympathy,” Wallace remarked as he took over the same cabinet post in 1945, “with Herbert Hoover’s problem as Secretary of Commerce.” The one obvious difference in their outlooks was Wallace’s willingness to provide the private entrepreneurs with public capital. “It is vital,” he asserted, “that Government co-operate with the export trade .  .  . to put on an aggressive sales campaign abroad.”

Wallace’s version of the expansionist outlook won him sharp criticism from Senator Robert A. Taft. Along with his repeated warnings that American policy might well provoke the Soviets into ever more militant retaliation, and perhaps even war, Taft’s attack on Wallace serves to illustrate the misleading nature of the popular stereotype of the Senator. Taft immediately spotted the contradiction between the rhetoric of the New Deal and the reality of its policies. “Dollar diplomacy is derided,” he commented very pointedly in 1945, “although it is exactly the policy of Government aid to our exporters which Mr. Wallace himself advocates to develop foreign trade, except that it did not [in its earlier forms] involve our lending abroad the money to pay for all our exports.”

Despite the perception of his analysis, Taft stood virtually alone. Congressman Clarence Murdock of Arizona offered what was perhaps the most striking summary of the majority view: “The proper foreign outlet is our safety valve.” Milo Perkins, a New Deal businessman who for a time headed the Board of Economic Warfare, offered a pungent statement of the familiar either-or thesis that had originated in the 1890s. “We must sell great quantities of machinery and transport equipment and machine tools abroad if we are to avoid large-scale factory shutdowns here at home.” Labor and farm leaders joined corporation executives and government officials in supporting that analysis. “We cannot possibly maintain full production and full employment,” the United Auto Workers announced in 1945, “unless we have a world pool of free and prosperous consumers.” “Foreign trade,” the union explained, “can be the margin between a drop into economic chaos and a steadily expanding economy.” Edward O’Neal, President of the American Farm Bureau Federation, was equally vehement. Agricultural surpluses “will wreck our economy unless we can find sufficient outlets in foreign markets to help sustain the volume of production.” In his view, the “finest” policy proposal involved Wilson’s old idea of extending the Monroe Doctrine to the world at large. “Let us spread it all over,” O’Neal suggested to the congressional committee on postwar planning; “let us run it into China, if necessary, and run it around into Russia.”

As it moved quickly to take over government affairs after the death of Roosevelt, the Truman Administration made it clear that it would sustain all these aspects of the traditional approach to foreign policy.^†††† “The United States cannot reach and maintain the high level of employment we have set as our goal,” Secretary of State James F. Byrnes reiterated, “unless the outlets for our production are larger than they’ve ever been before in peacetime.” Byrnes had neither time nor interest for the idea of working out some agreement with the Russians that involved the recovery loan they had requested. He even sidetracked the basic memorandum dealing with the issue. “I had it placed in the ‘Forgotten File’,” he later revealed, “as I felt sure that Fred Vinson, the new Secretary of the Treasury, would not press it.”

President Harry S Truman was for his part an enthusiastic and militant advocate of America’s supremacy in the world. He seemed, indeed, to react, think, and act as an almost classic personification of the entire Open Door Policy. From a very early date, moreover, he led the rapid revival of the analogy between Nazi Germany and the Soviet Union (and Hitler and Stalin) which became one of the fundamental clichés of America’s analysis of the postwar world. Given that analogy, which was very rapidly and very generally accepted, American policy can without much exaggeration be described as an effort to establish the Open Door Policy once and for all by avoiding what were judged—on the basis of the analogy—to have been the errors of appeasement made during the 1930s.

There were two central fallacies involved in that estimate of the world. Soviet Russia and Nazi Germany were significantly different in crucial aspects of domestic and foreign policy; and, unlike the situation in the 1930s, the United States was neither weak nor disarmed. Indeed, it enjoyed a great absolute as well as relative advantage in both economic and military power. As the United States Government candidly admitted even as late as 1962, the United States had been the strongest power in the world ever since 1944. For that matter, it was the existence and the knowledge of that strength that encouraged Truman and other leaders after 1945 to think that they could force the Soviets to accept American proposals without recourse to war.

It is no doubt wrong and inaccurate to conclude that the effort to establish the false analogy between Soviet Russia and Nazi Germany was the product of conscious distortion by America’s private and official leaders. Many of them adopted and used that argument in complete sincerity. They simply accepted it without serious thought or critical evaluation. However mistaken in fact and logic, such men were not hypocrites. But it also is true that there were a good many men who shared the attitude of Senator Arthur K. Vandenberg. He thought it was necessary “to scare hell out of the American people” in order to win their active approval and support for the kind of vigorous anti-Soviet policy he wanted. Those men did consciously employ exaggeration and oversimplification to accomplish their objectives. Senator Taft would seem to have offered a sound judgment on that conduct. He remarked during congressional consideration of the European Recovery Program that he was more than a bit tired of having the Russian menace invoked as a reason for doing any- and everything that might or might not be desirable or necessary on its own merits.

Truman not only thought about Russia in terms of Nazi Germany, but he made it clear very soon after he took the oath as President that he intended to reform the world on American terms. He casually told one early visitor “that the Russians would soon be put in their places; and that the United States would then take the lead in running the world in the way that the world ought to be run.” Then, on April 23, 1945, he told the Cabinet “that he felt our agreements with the Soviet Union so far had been a one-way street and that he could not continue; it was now or never. He intended to go on with the plans for [the] San Francisco [Conference] and if the Russians did not wish to join us they could go to hell.” Senator Vandenberg, soon to become (along with John Foster Dulles) the Republican leader of that bipartisan approach to the Soviet Union, caught the spirit—and reflected the absurd exaggeration—of the outlook of his diary entry of the following day: “FDR’s appeasement of Russia is over.”

As one insider remarked, “the strong view prevailed” from the very beginning, though it did not take on the form and tone of a great crusade against the Soviet Union and international communism until the end of 1946. Thus, for example, additional lend-lease allocations and shipments to Russia were canceled in May 1945. Truman later referred to it as “my greatest mistake,” and claimed that, given a second chance, he would have handled it differently. Nevertheless, all lend-lease to the Soviets was closed off promptly once the Japanese surrendered. It is also clear that, on a comparative basis, Russia was treated far less considerately than England and France during the process of termination. In those respects, therefore, the action was repeated.^‡‡‡‡

But in the first instance, and as Truman later explained, the authority to act had been sought by Leo Crowley, the Foreign Economic Administrator, who proceeded to interpret it very broadly and to use it very vigorously. Truman’s oblique comment that the whole affair was “clearly a case of policy-making on the part of Crowley and Grew” implies an explanation that can be substantiated by other evidence. Crowley’s push for the power was supported by Admiral William D. Leahy, Assistant Secretary of State Joseph Grew, and Harriman. All those men wanted to use American economic power to coerce the Soviets on policy issues. This is established beyond any question in a Grew memorandum of his phone conversation with Crowley on May 12, 1945, as they were working to obtain a grant of authority from Truman. The document makes it absolutely clear that Crowley and Grew had Russia in the very forefront of their minds as they pressured the President. For his own part, Crowley refused to consider the Russian request for a loan as coming under the lend-lease law, even though he did negotiate such an arrangement involving $9 million with France. Crowley’s general outlook was revealed when congressmen questioned him about loans in general. “If you did not like the government,” he was asked, “you would not have to make them a loan at all?” “That is right,” Crowley replied. “If you create good governments in foreign countries, automatically you will have better markets for ourselves.”

Whatever further details may ultimately be added to the story of the termination, there is no doubt that the action seriously antagonized the Russians. Stalin interpreted it as a move to put pressure on him to accept American policies, and bluntly called it “disturbing.” Then, in a very revealing series of comments, Stalin told Harry Hopkins in May 1945 that such an approach would not produce Soviet acquiescence.^§§§§

Stalin first provided an insight into the differences within the Soviet hierarchy. The Russian leader said that “he would not attempt to use Soviet public opinion as a screen but would speak of the feeling that had been created in Soviet governmental circles as a result of recent moves on the part of the United States Government.” “These circles felt a certain alarm,” he explained, “in regard to the attitude of the United States Government. It was their impression that the American attitude towards the Soviet Union had perceptibly cooled once it became obvious that Germany was defeated, and that it was as though the Americans were saying that the Russians were no longer needed.”

To be specific, Stalin continued, the way lend-lease had been canceled “had been unfortunate and even brutal .  .  . [and] had caused concern to the Soviet Government. If the refusal to continue lend-lease was designed as pressure on the Russians in order to soften them up, then it was a fundamental mistake.”

In this episode involving lend-lease, as well as in additional examples reported by Truman, Byrnes, and other American leaders, Molotov emerges as the leader and spokesman of the militant wing of the Soviet hierarchy. It should be remembered in this connection that Molotov caught the full impact of Truman’s vehement anti-Soviet attitude in a face-to-face meeting on April 23, 1945, that followed the crucial discussion of that policy among American leaders on the same day. There is considerable and convincing evidence, furthermore, that Molotov often took and persisted in a very tough line with the United States until Stalin intervened to modify and soften the Russian position. This interpretation of the disagreements among Soviet leaders is further and dramatically reinforced by events after Stalin’s death, and particularly by the continued agitation by Molotov against Premier Nikita S. Khrushchev’s efforts to establish the policy of co-existence and peaceful transition to socialism and communism.

In 1945, as in later situations of a similar nature, the position of Molotov and his supporters was unquestionably strengthened by the actions of the United States. Stalin was broadly justified in his fears expressed to Hopkins about the developing American attitude concerning the importance of Russia after the defeat of Germany. Truman and his advisors did not immediately and drastically downgrade Russian help. They continued to seek Soviet assistance against the Japanese until they learned that the atom bomb was a success. At that point, their attitude changed drastically: they clearly wanted to defeat Japan before the Russians entered the war. Even before that, however, at the end of April 1945, the change had begun to occur. Following the meeting of April 23, for example, the United States stopped pressing for air bases in Siberia, and ceased worrying about clearing the North Pacific shipping lanes to Russia’s far eastern ports. In a similar way, American position papers prepared for the forthcoming meeting with Stalin at Potsdam revealed a determination to push for the open door in eastern Europe.

III.A NEW VISION OF OMNIPOTENCE AND A MISREADING OF HISTORY PROMPT THE UNITED STATES TO OVERPLAY ITS HAND

Following upon President Roosevelt’s clear expression of a desire to retain “complete freedom of action,” the United States Government under President Truman initiated and sustained a vigorous drive to undercut the Stalin-Churchill agreement of October 1944, concerning eastern Europe, and to replace it with the Open Door Policy. Churchill supported that determined effort to subvert the understanding which he himself had originally and voluntarily written out and pushed across the table to Stalin. Truman and Churchill undertook that course, moreover, in the full knowledge and open acknowledgment that Stalin had honored his part of the bargain in Greece.

This insistence upon applying the Open Door Policy to eastern Europe (and, of course, to Asia) was decided upon before anyone knew for sure that the atom bomb would work.^¶¶¶¶ Along with the feeling among American policy-makers that Russia’s war-caused weakness would enable them to secure major concessions from Moscow, that consideration must be kept constantly in mind when following the sequence of events after the defeat of Germany. The success of the bomb strengthened an existing attitude and a traditional strategy—it did not call forth a new approach.

Stimson’s diary entry covering a conversation with Truman on June 6, 1945, indicates that American leaders were conscious of the relationship between the bomb and their general strategy at an early date. Truman “said that he had been thinking of that,” Stimson noted, “and mentioned the same things that I was thinking of, namely the settlement of the Polish, Rumanian, Yugoslavian, and Manchurian problems.” By the end of the month, in preparation for the Potsdam Conference, the American position concerning the countries of eastern Europe had become clear and firm. The United States planned “to insist on the reorganization of the present governments or the holding of free general elections.” The broad objective was phrased in the classic terms of the Open Door Policy: “To permit American nationals to enter, move about freely and carry on commercial and government operations unmolested in the countries in question.”

The goal was “access, on equal terms, to such trade, raw materials and industry” as existed and developed. In the meantime, such access was sought “to modify existing arrangements.” As part of that general effort, American officials planned to demand unrestricted movement for American newspapermen so that “the spotlight [can be] trained on these areas.” And finally, the United States emphasized the specific objective of internationalizing the commercial waterways of the Danube River system with a Western majority on the board of control.

Similar stress was laid on guaranteeing the Open Door Policy in Asia. American leaders seem to have entertained a particularly vivid hope that the defeat of Japan would turn the clock back to 1903–1904; a maneuver that would enable the United States to step back on the mainland of Asia at the moment of its greatest success in Manchuria with the expectation that this time it would not be frustrated as before. The Russians posed the only danger to this idyllic picture. On the eve of the first general session at Potsdam, for example, Stim-son seems to have set himself the role of special tutor to Truman and Byrnes on the importance of the Open Door Policy in the Far East. Even though the lessons had apparently been going on for some time, Stimson saw Truman again on July 14, 1945. “[I] went over [it] with him carefully,” Stimson wrote in his diary, “again and again warning him to be absolutely sure that the Russians did not block off our trade.”

Still concerned, Stimson wrote the President a special letter on July 16. Concentrating on “our clear and growing interests in the Orient,” the Secretary all but hammered the words through the page in the course of his pounding on the crucial importance of the Open Door Policy. Ideally, of course, Russia should not have anything to say about handling Japan or the general problems of the Far East. At most, and only if it became absolutely necessary in the face of Soviet complaints, some kind of “token occupation” would be arranged.

Stimson next had a briefing session with Byrnes on July 17. The subject had not changed. Neither had the dedication of the tutor. “I impressed on him,” Stimson recorded, “the importance of the Open Door Policy.” A series of special reports made the same point. Harriman, for example, prepared one which placed—even in that context—a noticeable emphasis on “the development of commerce and trade of the United States.” Perhaps his service as an artillery officer in World War I had inured him to such bombardments, for Truman seemed never to blink at the hammering on the same point. Obviously pleased, Stimson reported on July 18, 1945, that the President “was confident of sustaining the Open Door Policy.”

Stalin arrived in Potsdam with a noticeably different set of priorities. He was still concerned about Russia’s frontiers in Europe, about preventing Germany from trying it again in another 25 years, and about a major economic transfusion for the Soviet Union’s battered economy. Apparently shrewd enough to realize that he had little chance to obtain a large loan from the United States, and in any event unable to plan on that basis in the summer of 1945, Stalin laid immediate and heavy emphasis on being treated as an equal and upon obtaining massive reparations from Germany and its former allies.

“This Council,” Stalin remarked in explaining the Soviet view of the conference at its first general session, “will deal with reparations and will give an indication of the day when the Peace Conference should meet.” The primary political issue, he continued, was that of dealing with Germany and its former allies. That was “high policy. The purpose of such a policy was to separate these countries from Germany as a great force.” Referring often to the “many difficulties and sacrifices” brought upon Russia by those Axis partners, Stalin argued that the proper strategy was “to detach them once and for all from Germany.” As for reparations, Russia would if necessary “compel” such deliveries.

The American response on reparations was crucial to the outcome of the Potsdam Conference, and also, very probably, to the whole course of subsequent events. “Reparations,” Byrnes told Molotov on July 20, “do not seem to the United States to be an immediate problem.” He then added that “the United States does not intend to make advances to any country in order that reparations may be paid by them.” “We do not intend, as we did after the last war, to provide the money for the payment of reparations.” The full significance of those remarks by Byrnes cannot be grasped without understanding both the background of each of them, and the interrelationship between them. It seems wise, therefore, to discuss them separately before putting them together.

First of all, and as revealed in Byrne’s remark about loans, American policy-makers had misread the history of their experience with reparations after World War I. They concluded that American loans to Germany had simply ended up as reparations to England and France, who themselves had not repaid their debts to the United States. In the American view, therefore, the United States had been twice played the fool. The vigorous assertion by Byrnes reflected a determination not to fall into the same trap still another time.

That reaction was based on a seriously distorted interpretation of the World War I experience. It neglected, on the one hand, the creative role of American loans and the harmful effects of having actually collected money from England and France. On the other hand, and regardless of the estimate made of those and similar factors, the World War I situation blinded American leaders to the vastly different one that existed at the end of World War II. It was not so much that they had learned no lesson from history but rather that they had become almost obsessed with the wrong lesson.

The real point was that the capital for reconstruction at the end of World War II had to come from some place. Alternative sources were available. Either it could come from the United States under more relevant conditions and terms than had been arranged at the end of World War I, or it could come in the form of reparations taken by Russia—reparations which could be stopped only by recourse to another war. American policy-makers had used history to block their view of the present.

In order to avoid the second alternative, American leaders would obviously have had to negotiate a loan to Russia in conjunction with their discussion and settlement of other issues. But that approach was never even initiated, let alone put into sustained operation. The contradiction involved can be explained, however, by reference to the atom bomb. Byrnes knew, when he told Molotov on July 20 that reparations were not “an immediate problem” that the atom bomb was a success. The first news reached Potsdam on July 18. And as Stimson noted in his diary, Truman and other American leaders were “highly delighted” and “very greatly reinforced.” It seems very likely, therefore, that the information on the bomb (even though the first dispatches were not complete accounts)served to convince the United States that it could hold the line on reparations and bargain from a position of formidable power.

But this reaction actually served, in a deeply ironic way, to close both the intellectual and the psychological jaws of the trap that American policy-makers had set for themselves. For in fact it left the United States with no moderate, flexible policy. It hardened both the feeling that the Russians would have to come to terms and the reading of history to the point that no loans should be granted if they would end up as reparations. That attitude left the United States with no choice but to acquiesce or use the bomb if the Russians refused to give way and accept American conditions for economic aid.

The extent to which this analysis explains American policy can be seen by the response to further news about the bomb test. Truman had already indicated, in a private conference with Churchill, that he was very favorably inclined toward the old Roosevelt idea of an Anglo-American entente. He was also aware of the understanding between Churchill and Roosevelt of September 18, 1944, concerning the bomb: “The suggestion that the world should be informed .  .  . with a view to an international agreement regarding its control and use,” the two had agreed, “is not accepted.”

Churchill seems to have insinuated in his masterful way that the secret might be kept from Stalin. This was by no means a novel idea. It had, after all, been kept from him up to that point. And Stimson records that he and others were very “doubtful” about sharing the news of the test bomb. However it evolved, and Truman appears to have refused to consider saying nothing to the Russians, the final compromise was to tell Stalin in a brief, casual way that the United States had developed a new weapon. Much has been made of the fact that Stalin already knew about the bomb through espionage. That is of course true, but he probably learned more of direct importance in observing how the news of the successful test firing affected the attitude and manner of Truman and Byrnes at the next session of the Potsdam Conference.

Stimson reports that Truman was “immensely pleased” and “tremendously pepped up by it.” The President “said it gave him an entirely new feeling of confidence.” This change is apparent even in reading the third-person stenographic account of the meeting with Stalin on July 21, 1945. One of the first questions to arise concerned the governments in eastern Europe, and this is the official account.

PRESIDENT TRUMAN:    The American Government was unable to recognize the governments of the other satellite countries [besides Italy]. When these countries were established on a proper basis, the United States would recognize them and not before. The President stated that the meeting would proceed and that this question would be passed over.

After he returned to England, Churchill told the House of Commons that “we possessed powers which were irresistible.” His comments to Stimson at the time, in Potsdam, are perhaps even more revealing. “He [Truman] stood up to the Russians in a most emphatic and decisive manner, telling them as to certain demands that they absolutely could not have and that the United States was entirely against them .  .  . . He told the Russians just where they got off and generally bossed the whole meeting.”

Truman bossed the meeting but he did not change American policy on reparations. That oversight served to subvert the power of the bomb. An astute American observer warned on the next day, July 22, that the Russian position on reparations should not be discounted. It was backed by “intense popular feeling and fresh experience.” But the old bloc against loans, when combined with the new vision of omnipotence, led the United States into a dead end. In order to avoid financing Russian reparations through loans to Germany, Italy, or other former Axis partners, and with the myopic confidence induced by the news of the bomb, Byrnes proposed to Molotov on July 23 that “each country tak [e] reparations from its own zone.”

Now the fascinating thing is that the Russians fought that proposal for one whole week—from July 23 to July 31—before Stalin finally agreed to it. Even then, he remarked very sharply that it was “the opposite of liberal” ^###

Those two sentences have been set apart, and even further emphasized, for two reasons. First: the Byrnes offer to Molotov of July 23 clearly meant that the Russians would have a free hand in their zone of Germany and throughout eastern Europe. The freedom to control economics implied—demanded—political control. Assistant Secretary of State Clayton understood this point and commented on it with great perception in a memorandum of August 16, 1945, after the offer had been accepted by the Soviets. Although he was formally denying the point he was raising, the tone of his remarks needs no comment. “There appears to be,” he noted ruefully, “an unfortunate tendency to interpret the reparations operating agreement as an indication of complete abandonment of four power treatment of Germany. This is not stated in the texts and should not be accepted as a necessary conclusion .  .  . .” But whether accepted or not, that was the meaning of the final arrangement.

To argue that the Russians did not understand the implications of the Byrnes offer of July 23 even though Clayton did is to argue that they were fools. To argue that they did understand it and still acted as they did is to argue that they played Byrnes and Truman and Stimson along for one entire week as a matter of private amusement. Those positions can be held and defended as viable explanations of Russian behavior. But the evidence indicates that the Russians very deeply wanted a firm commitment on reparations in the form of heavy industrial equipment from the restored production of the Ruhr Valley more than they wanted anything else. Such reparations would not only provide crucial help at home, but the agreement providing for them would be based on an Allied control of German industry that would in turn limit Germany’s ability to start another war. Clayton himself, certainly as conservative and hard-headed an operator as the United States had produced, concluded in a memorandum of July 27, 1945, that this was the correct analysis. Molotov’s behavior between July 23 and July 31 further supports that interpretation.

Molotov connected the issues of reparations and German war potential very simply: “The question of reparations was even more urgent because unless this was settled there could be no progress on economic matters” involving the future strength of German industry. Hence the Soviets wanted “clear replies to the questions.” Byrnes gave them one by suddenly remarking that the United States now considered the Yalta figure of $10 billions for Russia to be “impractical.” Molotov then shot back that the Soviets were “entitled to a clear answer” on what figure the United States did find acceptable. Failing to obtain one, Molotov then raised—very directly and without any frills—the central implication of the proposal that Byrnes had offered on July 23.

MR. MOLOTOV:    My understanding, Secretary Byrnes, is that you have in mind the proposal that each country should take reparations from its own zone. If we fail to reach an agreement the result will be the same.  .  . .

THE SECRETARY [BYRNES]:    Yes.  .  . .

MR. MOLOTOV:    said would not the Secretary’s suggestion mean that each country would have a free hand in their own zone and would act entirely independently of the others?

THE SECRETARY [BYRNES]:    said that was true in substance.  .  . .

In spite of those candid and revealing remarks by Byrnes, the Soviet Union nevertheless continued its efforts to reach an agreement involving all of Germany. Molotov was still “anxious” about the issue on June 29 and 30. He wanted “a fixed sum or quantity agreed upon,” including materials from the Ruhr, because the Soviets feared “they would be left with very little equipment as reparations in spite of the fact that the Germans had destroyed Soviet industries. They needed agricultural machinery and [goods] to rehabilitate their railroads.” They also wanted to settle what Stalin had on the first day of the conference referred to as the issue of “high policy“—preventing Germany from attacking Russia in another 25 years.

Finally, in the face of continued American refusal to discuss the issues in that related way, Stalin accepted the Byrnes proposal of July 23, 1945. He then extended it in a way that clearly foreshadowed the division of Europe. The specific issue involved the assignment of German assets in other European countries, but the discussion immediately picked up overtones of a far broader nature.

PREMIER STALIN:    .  .  . with regard to shares and foreign investments, perhaps the demarcation lines between the Soviet and Western zones of occupation should be taken as the dividing lines and everything west of that line would go to the Allies and everything east of that line to the Russians.

THE PRESIDENT [TRUMAN] inquired if he meant a line running from the Baltic to the Adriatic.

PREMIER STALIN replied in the affirmative.  .  ..

[BRITISH FOREIGN SECRETARY] BEVIN said he agreed and asked if Greece would belong to Britain.  .  ..

PREMIER STALIN suggested that the Allies take Yugoslavia and Austria would be divided into zones.  .  ..

MR. BYRNES said he thought it was important to have a meeting of minds. Mr. Bevin’s question was whether the Russians’ claim was limited to the zone occupied by the Russian Army. To that he understood Mr. Stalin to say ‘yes.’ If that were so he was prepared to agree.

PREMIER STALIN replied in the affirmative.  .  ..

THE PRESIDENT [TRUMAN] said that he agreed with the Soviet proposal.

The American decision to give the Russians a free hand on reparations throughout eastern Europe can in the end be explained only in one of three ways. The first would be to assert that the United States knowingly handed eastern Europe over to the Soviet Union. This is absurd on the face of it. It is also belied by Truman’s actions during the conference, and by his blunt public remarks after the meeting was over. The eastern European countries, he announced on August 9, 1945, were “not to be spheres of influence of any one power.” The Open Door Policy was thereby reaffirmed. A second explanation would be based on the idea that the United States made the reparations deal without understanding its political implications. But that interpretation is undercut by the analyses prepared by Clayton and other American officials who did see those possibilities.

The third explanation is supported by direct and indirect evidence. It is, simply, that the United States—confident in its vast economic and military superiority over Russia—made the reparations agreement to avoid any indirect financing of Soviet recovery. American leaders were certain that the bomb, and Russia’s great recovery needs, provided them with the leverage to re-establish the Open Door, and pro-Western governments, in eastern Europe.

This vision of omnipotence was apparent in Truman’s remarks of August 11, 1945. “We must constitute ourselves,” he explained, “trustees of this new force to prevent its misuse.” As for the possibility that the Soviets would construct their own bomb, Byrnes recalled that “no one seemed too alarmed at the prospect.” But perhaps the best evidence of the American attitude came in connection with the use of the bomb against Japan. Byrnes later remarked that American leaders had eastern Europe as well as Asia in mind when they reached the decision to use the weapon as soon as possible.

That recollection is borne out by the evidence of the time. The decision to bomb Japan as quickly as possible was made during the Potsdam Conference, and at the very time of the toughest discussions about eastern Europe. In a very candid meeting on July 23, 1945, Truman, General George C. Marshall, Stimson and others generally agreed that the Russians were no longer needed in the war against Japan. They also talked very directly of using the bomb before the Russians could enter that conflict. Actually, however, that was not a new approach. Stimson had recommended as early as July 2, 1945, that the bomb should be dropped at a time when “the Russian attack, if actual, must not have progressed too far.” And once it had proved out in the test, Truman was “intensely pleased” with the chance of using it before the Russians even entered the war.

This sense of urgency about using the bomb makes it possible to advance beyond the question of whether the United States dropped the bomb to end the war against Japan, or whether it did so in order to check the Russians. The evidence provided by the government archives and private American leaders converges on one explanation: The United States dropped the bomb to end the war against Japan and thereby stop the Russians in Asia, and to give them sober pause in eastern Europe.

Once it was known to work, the atomic offensive against Japan could have been delayed as much as a month or six weeks—if all that had been at stake was the saving of American lives which might be lost in the invasion of Kyushu that was projected for the fall By that time, for example, the United States would have had a small arsenal of the weapons, so that it would have made little difference if the first drop during a demonstration had misfired, or otherwise failed. As for the saving of lives, they would still have been spared by using the weapon in September. But the bomb had to be used quickly, and if necessary repeatedly, if the war was to be ended before the Russians honored their promise to attack within three months after Germany was defeated.

Secretary of State Byrnes offered this very explanation of the dropping of the bomb—and with equal directness. Indeed, he did so twice. He was asked in 1960, on the fifteenth anniversary of the bomb, whether there was “any urgency to end the war in the Pacific before the Russians became too deeply involved?” “There certainly was on my part,” Byrnes replied. “We wanted to get through with the Japanese phase of the war before the Russians came in.” ^***** Even earlier, in 1958, Byrnes revealed how the United States encouraged Chiang Kai-shek to drag out his negotiations with Stalin over their arrangements in Manchuria.^{†††††} Referring to an American dispatch to Chiang of July 23, 1945, Byrnes explained the meaning and importance of a particular sentence. “The second sentence was to encourage the Chinese to continue negotiations after the adjournment of the Potsdam Conference. .  .  . If Stalin and Chiang were still negotiating, it might delay Soviet entrance and the Japanese might surrender. The President was in accord with that view.”

American leaders were becoming so enthusiastic and confident over the power of the bomb that Secretary of War Stim-son undertook a very courageous and searching review of the existing attitude. Even before Roosevelt died, Stimson was somewhat disturbed over the way various members of the government were reacting to the progress reports on the weapon. True enough, he felt that the bomb should be used against Japan, and kept from the Russians until safeguards had been established; but he also fretted that the attitude of the majority of American leaders would lead neither to peace nor prosperity. During the next five months, Stimson grew progressively more convinced that American policy concerning the bomb was leading into another armament race, and perhaps even to a horrible war with Russia. On the eve of the Potsdam Conference, for example, he cautioned Truman that war would become inevitable if the United States took the position that all differences with the Soviet Union were irreconcilable. The Secretary’s increasing concern was very probably caused by the interaction of four factors: the strong line taken by Truman and Byrnes at Potsdam; the awful destruction caused by the bombs at Hiroshima and Nagasaki; the clear evidence that Byrnes and the President had been encouraged by the bomb to maintain and even increase their pressure on Russia at the upcoming foreign ministers’ conference scheduled for September in London; and his own searching thought and reflection on the problem, which was certainly provoked in part by his own great responsibility in recommending the use of the weapon.

The evidence suggests very strongly that Stimson devoted most of his intellectual and moral energy to the problem of the bomb from the end of the Potsdam Conference through the time when he received reports on the havoc caused in Japan. The result was a performance very similar, though of course more courageous and dramatic, to the one resulting from his experience in the late 1920s with armed intervention in Latin America. In that instance he concluded he had been wrong and set about to bring the Marines home from Nicaragua and to change the basic policy.

Stimson decided in the late summer of 1945 that the United States “was on the wrong path” in handling Russia in connection with the bomb. Having made that judgment, he undertook a brave, serious effort to persuade Truman and Byrnes to change their policy. He saw Byrnes on September 4, 1945, only to discover that the Secretary of State “was very much against any attempt to co-operate with Russia.” Stimson noted that Byrnes was “full of his problems with the coming meeting of the foreign ministers and he looks to having the presence of the bomb in his pocket, so to speak, as a great weapon.”

Byrnes left for London on September 5, unmoved by Stimson’s arguments. Deeply concerned, and aware that his long government service was coming to an end, Stimson took his case directly to the President. His formal letter and memorandum to Truman dated September 11, 1945, made two crucial points. The first involved his conclusion, based on a careful evaluation and analysis of all the evidence he could obtain, that American efforts to force the pace, or determine the nature, of internal relaxation or liberalization in Russia by applying pressure “would be so resented that it would make the objective we have in view less probable.” It followed from that estimate that the most vital issue of American foreign affairs concerned the way that the United States dealt with Russia in connection with the bomb. Stimson outlined the consequences of the then existing attitude and policy of Truman and Byrnes with a degree of accuracy that seems almost eerie in view of subsequent developments. “Unless the Soviets are voluntarily invited into the [nuclear] partnership upon a basis of co-operation and trust, we are going to maintain the Anglo-Saxon bloc over against the Soviet in the possession of this weapon. Such a condition will almost certainly stimulate feverish activity on the part of the Soviet toward the development of this bomb in what will in effect be a secret armament race of a rather desperate character. There is evidence to indicate that such activity may have already commenced.”

He continued in a passage so important that he italicized it when making the document public in 1948. “Those relations may be perhaps irretrievably embittered by the way in which we approach the solution of the bomb with Russia. For if we fail to approach them now and merely continue to negotiate with them, having this weapon rather ostentatiously on our hip, their suspicions and their distrust of our purposes and motives will increase.”

In conclusion, Stimson stressed the need for a direct approach “to Russia.” ‘I emphasize perhaps beyond all other considerations,” he wrote, “the importance of taking this action with Russia as .  .  . peculiarly the proposal of the United States. Action of any international group of nations, including many small nations who have not demonstrated their potential power or responsibility in this war would not, in my opinion, be taken seriously by the Soviets.”

Stimson’s powerful argument may have caused Truman to pause, and perhaps momentarily to reconsider the militant anti-Soviet policy he had laid down on April 23, 1945. If so, the second thoughts were quickly set aside. Byrnes arrived in London determined to apply the strategy of the Open Door Policy in every area of the world. On the question of Axis colonies, for example, the American proposal was to place them under a trusteeship guaranteeing the open-door principle. And as far as Japan and the Asia settlement were concerned, the United States took its control so much for granted that Byrnes was truly “surprised” when the Russians asked for some share in making the decisions.

The clash in London was most fully revealed in connection with the two issues that had dogged American-Soviet relations ever since 1944. The first involved the continued efforts of the United States to abrogate the Churchill-Stalin bargain of October 1944, which had underwritten Soviet predominance in eastern Europe. The second was defined by the refusal of the United States to commit itself on the reparations issue, which for their part the Russians stressed above all else. On both questions, furthermore, Byrnes had in Labor Foreign Secretary Ernest Bevin an ally whose militance measured up to the standard set by Churchill.

As it happened in London, moreover, the United States used its power to attempt to displace an existing agreement. As Byrnes later explained to the Congress, the American objective was “the maintenance of the open door in the Balkans.” Specifically, Byrnes was “disturbed” by, and sought to limit or stop completely, the Soviet moves to establish close economic partnerships with eastern European nations. In the positive sense, he sustained Truman’s drive launched during the Potsdam meeting to internationalize the entire Danubian waterway system.

That move of Truman and Byrnes in 1945 was in many respects similar and comparable to Secretary of State Knox’s attempt in 1909 to internationalize the Manchurian railway system. The analogy is illuminating. The American objective was the same in both cases: as the London Times described the postwar maneuver, to establish the conditions under which there would be “free entry into the Danube Valley and Eastern Europe for the goods and capital of the Western countries.” And just as it had been assumed in Manchuria, so it was also assumed in eastern Europe in 1945 that such free access for American economic power would in turn help to create and sustain political predominance. The American demand for free elections in eastern Europe was considered by American policy-makers as much a means to such economic and political ends as a philosophic or moral end in and of itself.^{‡‡‡‡‡}

But as Knox had failed in 1909, so did Byrnes fail in 1945. As they had done in 1909, the Russians in 1945 evaluated the American proposal for exactly what it was. And as in the earlier episode, so also in the later one—the Russians resisted. One exchange between Byrnes and Molotov summarized not only the impasse at London in 1945, but much of the diplomacy of the succeeding 15 years. The Secretary of State tried to persuade Molotov that the United States, despite its demands for the Open Door and its refusal to come to terms on reparations, was not trying to weaken or close out Soviet influence in eastern Europe. “I must tell you,” Molotov replied, “I have my doubts as to this.”

IV.THE DIPLOMACY OF THE VICIOUS CIRCLE

The New York Times correspondent Herbert L. Matthews wrote from London on September 25, 1945, what probably remains the best short analysis of what happened between the spring and the early fall of that fateful year. “France, Britain, and the United States, in seeking to absorb eastern Europe into a unified continental system, are aiming to weaken the Eastern bloc, and at the same time they are being forced with varying degrees of reluctance into the formation of that very Western block that Russia dreads.

“It is a vicious circle.  .  ..”

Soviet Russia’s initial response to the American outlook and action was ambivalent. On the one hand, and by necessity, it launched a major program of reconstruction based on labor and capital extracted from a war-weary and weakened populace, supplemented where possible by reparations from Germany and eastern Europe. On the other hand, and as feared by former Secretary of State Hull as early as April 1945, it sought to “establish outposts, bases, and warm-water harbors in many areas and add buffer territory and otherwise prepare her own outward defenses just as fully as if the United Nations were not in existence.” Yet in every case but one, that involving eastern Europe, Russia retreated from these efforts in the face of America’s vigorous and militant opposition.

Thus Russia withdrew from Iran, leaving the Western powers in a predominant strategic and economic position. Thus it also retreated from its efforts to modify Western supremacy at the entrance (and exit) of the Black Sea. And thus it acquiesced, though under vigorous protest, when on May 3, 1946, the United States abruptly and unilaterally announced that it was terminating reparations to Russia from the Western zones of occupied Germany. These reparations, never large, had been arranged as part of interzone economic rehabilitation after the Potsdam Conference.

This decision, apparently taken on his own responsibility by General Lucius Clay, the Military Governor of the American zone, very probably had a crucial effect on the deteriorating relations between the United States and the Soviet Union.^§§§§§ It can of course be debated whether any single action can or should be called decisive when the general situation already exhibited such momentum toward sustained and embittered antagonism. On the other hand, Soviet officials stationed in Germany who later came to the West testified that it was “one of the pivotal events.” And it provoked the first all-out postwar propaganda attack by the Russians upon American policy. Those considerations make it useful to examine the episode more fully.

It is essential first of all to realize the issue was economic. Given that, the importance and the impact of the action can best be understood by placing it in its general and specific context. At the beginning of the year, on January 5, 1946, Truman had declared that World War III was inevitable unless Russia was “faced with an iron fist and strong language.” By the end of January, Byrnes had discontinued “the practice of having private meetings with the Russians,” even though “they were always eager to do so.” Then, on March 5, Truman applauded from the platform as Churchill delivered his extremely violent and unrestrained anti-Soviet “Iron Curtain” speech at Fulton, Missouri.

Stalin promptly and bluntly called Churchill’s performance “a dangerous act.” He went on to speak of it as “something in the nature of an ultimatum: ‘Accept our rule voluntarily and then all will be well; otherwise war is inevitable’.” A bit later, on April 4, 1946, Stalin told the American Ambassador to Russia that in his opinion the United States had “definitely aligned itself with Great Britain against the U.S.S.R.”

Clay’s action on reparations was intimately bound up with American conditions for a loan to Russia. American representatives persistently tied such aid to the question of the Open Door Policy in eastern Europe. Secretary of Commerce Wallace warned Truman on March 14, 1946, that such an approach was increasing the tension. He suggested that it would be more fruitful “to talk with them in an understanding way” about “their dire economic needs and of their disturbed sense of security.” Contrary to the impression created by all the vicious attacks on Wallace, he was not proposing anything that could be called appeasement. He wanted a calm and less adamant approach to economic discussions as a means of persuading the Russians to modify “many of their assumptions and conclusions which stand in the way of peaceful world co-operation.” Wallace wanted neither to demand nor to surrender, but only to bargain in a mature fashion. But quite in keeping with his support for Churchill, Truman reports that he “ignored this letter of Wallace’s.” Note that the President does not say merely that he considered but finally rejected Wallace’s analysis and proposal. He “ignored” it. In that difference lies considerable insight into the state of the cold war as of March 1946.

By cutting off reparations so soon thereafter from the western, industrial zones of Germany, Clay in effect put real and positive, as well as verbal and negative, pressure on the Russians. The Soviets no doubt interpreted Clay’s actions as proof of America’s double standard of judgment. For at the very outset of the four-power occupation of Germany, long before the Russians took any such steps, the French had refused to be bound by any joint Allied decisions. They handled their zone as they pleased. To the Russians, at any rate, the conclusion was obvious. Not only could they not negotiate a loan, as the French had been able to do, but they were being punished in a very vital area for the kind of behavior that, when taken by the French, was tolerated by the United States.

Clay’s action was also important as background for a subsequent and very significant move by the United States. His termination of reparations came less than six weeks before the United States offered its long-heralded plan to control and ultimately share the secrets of atomic energy. The point here is not only that Clay’s clamp-down on reparations squeezed a very tender Russian nerve, and thereby increased the general tension; but that it was an economic nerve that was very quickly pinched again and even harder by the American proposal on nuclear energy.

The American approach to the atom appeared first as the so-called Acheson-Lilienthal Report of March 1946. During the next three months it was transformed, under the general direction of Bernard Baruch, from a general analysis and report into a proposal involving sanctions against violators. Then, on June 14, it was presented to the United Nations. The final policy proposal is usually considered to be proof positive of American statesmanship and generosity, and its rejection by the Russians as the final evidence of their intransigence. While that matched set of conclusions can be, and has been, advanced with great power and persuasion, it nevertheless seems worthwhile to review the essential elements of the episode.

The strongest part of the generally accepted favorable interpretation concerns the point that the United States offered the proposal even though it enjoyed a monopoly of nuclear power. It is usually implied, furthermore, that America did this without any prompting or pressure. Let there be no misunderstanding on two points. It was a positive move, and there is no reason to question either the sincerity or the good intentions of American leaders. In a similar way, it can be argued that it is unrealistic and even unfair to criticize the United States on the grounds that it should have done more—or should have done differently what it did. This may be, even probably is, true in the sense of being highly improbable.

But it is fair to point out at the very beginning of any evaluation of the American plan that such criticism is not unrealistic or unfair in the sense of being made outside the context and obligations of direct governmental responsibility. For Stimson made exactly such criticism in September 1945, while he was Secretary of War.

Stimson’s memorandum to Truman offers or suggests three crucial insights into the general nature of the American attitude and policy. The first stems from his blunt warning that the United States would not secure its objectives if it merely continued to negotiate with Russia “having this weapon rather ostentatiously on our hip,” or if it did so in a way that involved “many small nations who have not demonstrated their potential power or responsibility.” The American proposal on atomic energy ignored and violated both those danger signals. Secondly, the rapid development of a tough American policy in the summer and fall of 1945 that prompted Stimson’s memorandum also provoked serious concern and fears on the part of the British. Prime Minister Clement Attlee told Truman that the question uppermost in his mind was a fundamental one: “Am I to plan for a peaceful or a warlike world?” Attlee’s subsequent visit to Washington in November 1946, was clearly undertaken to influence Truman to take the former course in connection with atomic energy, and had some effect. This British pressure has to be credited in any assessment of American action. Finally, Stimson’s memorandum bears directly, and in two ways, on the whole question of American disarmament at the end of the war. The official and widely accepted view is that the United States disarmed almost completely. This conclusion seems to have stemmed from three things: the extremist rhetoric and rather frantic behavior of Secretary of Defense James V. Forrestal who replaced Stimson (and similar assertions by assorted newspaper columnists and other pundits); the annual scare campaigns conducted by the Army, Navy, and Air Force in connection with their budget requests; and various formal and pseudohistorical accounts of the immediate postwar period prepared by the State Department, other government agencies, and associated intellectuals as part of cold-war propaganda.

But the striking thing is that neither Stimson nor Truman thought that the United States stood disarmed and defenseless before the Russian bear. Neither did Churchill. The Stimson letter to Truman of September 1945, is based on the assumption that the possession of the bomb and the capacity to deliver it gave the United States a clear military advantage: it meant having “this weapon rather ostentatiously on our hip.” Churchill stated the same thing very simply in March 1946: the bomb kept the Russians under control. And Truman, on July 10, 1946, in a letter to Baruch about the American control plan, phrased it with perfect candor. “We should not under any circumstances throw away our gun until we are sure the rest of the world can’t arm against us.”

The fact is that the United States had not disarmed just because it had demobilized the mass army created to fight World War II. Nor did its leaders think it had disarmed. Men like Forrestal merely wanted more conventional weapons to exploit the basic advantage of nuclear supremacy. Granted their assumptions, it was an intelligent proposal, but it had nothing to do with a desperate need to provide a disarmed United States with the means of its survival. Indeed, Forrestal himself admitted during his own campaign—as in his diary entry for June 10, 1946—that “the Russians would not move this summer—in fact at any time.”

Truman’s remark about “our gun” brings into clear focus the first of three essential points concerning the Acheson-Lilienthal-Baruch plan for the atom. The American proposal not only failed to set any time for giving up the nuclear weapons monopoly held by the United States, but it never committed the United States to do so in any firm manner. “The plan,” explained the joint committee, “does not require that the United States shall discontinue such manufacture [of the bomb] either upon the proposal of the plan or upon the inauguration of the international agency. At some stage in the development that is required.”^¶¶¶¶¶ But the United States never specified the conditions of that stage. Let the motivations of the United States be accepted as stated by its protagonists and defenders, that demand for an immediate quid from Russia without a clear commitment to supply the quo by America remains a gaping weakness in the plan.

This suggests very strongly that J. Robert Oppenheimer was being accurate and candid in his recounting of the proceedings of the Acheson-Lilienthal committee, of which he had been a member.^##### He makes the second principal point about the American proposal: it was conceived in the spirit of Truman’s remarks in August and October 1945. “The prevalent view,” he explained, “saw in the problems of atomic energy .  .  . an opportunity to cause a decisive change in the whole trend of Soviet policy.” “There appears to be little doubt that we yearn for the notion of a trusteeship more or less as it was formulated by President Truman in his Navy Day Address of late 1945.” At that time, on October 27, the President had invoked the “righteousness and justice” of American foreign policy, and had assured the public that he would refuse to participate in “any compromises with evil.”

Finally, the American plan demanded even more of the Russians than that they trust the United States with a nuclear weapons monopoly for an indefinite period. It asked in the meantime that the international authority established to administer the program should be granted extensive control over the nuclear economic affairs, and by indirection all economic affairs, of the Soviet Union. This is clearly one of the points that Oppenheimer had in mind when he spoke of the committee’s idea of changing Soviet policy.

This proposed international authority was to be one, according to Baruch, “to which should be entrusted all phases of the development and use of atomic energy, starting with raw materials and including: 1. Managerial control or ownership of all atomic energy activities potentially dangerous to world security. 2. Power to control, inspect and license all other atomic activities.”

Baruch seems to have understood from the beginning what this meant as far as winning approval from the Russians. For this phase of the plan amounted to applying the traditional Open Door Policy to atomic energy, and backing it up with sanctions. If this seems at first glance to be an exaggerated or mistaken analysis, it appears that way only because of the matter of timing involved. Fundamentally, the plan proposed the same kind of internationalization of the atom that Secretary Knox advocated for the Manchurian railways in 1909, and that Truman demanded for the Danubian waterways in 1945.

The Baruch plan held out the prospect of an open door for the development and use of atomic energy. The only difference was that in this case the United States was going to retain the job of doorman for an indefinite period. It was as if the United States had enjoyed monopoly control of the Manchurian railroad system in 1909, and had proposed to admit other nations to participate in the venture on American terms and according to an American timetable. At some unspecified time, the United States would remove all restrictions on share purchasing—assuming that it would retain 51 per cent of the voting stock. In the meantime, the new but still American-controlled board of directors was to have the power to prevent the construction of competing lines either across Siberia or in China proper.

That analogy should also help in understanding why the Russians refused to agree to the Baruch plan. Baruch himself explained it on June 16, 1946, as well as—if not better than—the Soviet spokesmen did in their own speeches. Russia, he commented, “has no intention of permitting a situation whereby the national economy of the Soviet Union or particular branches of that economy would be placed under foreign control.” That was fair and accurate enough, but then neither did the United States have any such intention. The result was precisely what Stimson had predicted: “A secret armament race of a rather desperate character.”

Secretary of Commerce Wallace had become, by September 1946, so disturbed by the tone and tempo of this race that he spoke out even more forcefully than Stimson had done exactly a year earlier. He bluntly told Truman and the American public that it was time to stop using a double standard in dealing with the Soviet Union. “We should be prepared to judge [Russia’s] requirements against the background of what we ourselves and the British have insisted upon as essential to our respective security. We should be prepared, even at the expense of risking epithets of appeasement, to agree to reasonable Russian guarantees of security.” He also reiterated his suggestion of March 1946, to make “a new approach along economic and trade lines.”

Truman did not agree with Wallace. Neither did Secretary Byrnes, then engaged in being firm with the Russians during negotiations in Paris. Neither did Truman’s other advisors, or the top men in the Department of State. And neither did the Congress. Wallace was dismissed from the Cabinet on September 20, 1946. The Russians no doubt interpreted the firing of Wallace for what it was—a resounding reassertion of the tough policy. And as if to make sure they got the point, Byrnes, on October 16, 1946, cancelled an existing Export-Import Bank loan to Czechoslovakia.

Most commentators make a great deal of Andrei A. Zhdanov’s rise to power in setting and enforcing the Soviet interpretations of intellectual and political questions. He did win this authority, and he advocated a very tough and even vulgar anti-Americanism derived from his argument that the world was divided into two hostile camps. But Zhdanov did not reach his position as commissar of the party line until the same period that Wallace was fired for challenging Truman. Figuratively speaking, Wallace and Zhdanov passed each other going in opposite directions aboard their elevators in the respective power systems during the last week in September 1946. And as the Varga debates of May 1947 indicated, Zhdanov cannot really be said to have fully consolidated his position for at least six months.

In this, as in so many other aspects of the cold war, the timing of apparently disparate, incidental, and unrelated events is crucial to an understanding of what was going on inside and between the two countries. In a similar way, it is a grave error to evaluate or interpret the diplomatic moves of 1945 and 1946 in an economic vacuum. This is true in three respects. First, a good many of them were specifically economic in character. Second, all of them were intimately bound up with Russia’s concern to obtain either a loan from the United States or extensive reparations from Germany and its former allies in eastern Europe. And finally, the determination to apply the Open Door Policy to eastern Europe, which led directly to the policies of “total diplomacy” and “negotiation from strength” later made famous by Secretary of State Acheson, evolved concurrently with a deep concern over economic affairs in the United States.^******

This fear had never really disappeared after the Recession of 1937–38. It was even present, though in its most subdued forms, during the concentrated drive in 1942–43 to win the war by out-producing the Axis. It regained all its former vigor, and power over the thinking of American leaders, beginning with the congressional hearings of 1943 on postwar planning and economic policy. By March 1946, the New York Times reported that “in all groups there is the gnawing fear that after several years of high prosperity, the United States may run into something even graver than the depression of the Thirties.” The Employment Act of 1946, designed to relieve such anxiety, did not seem to reassure very many people.

Perhaps an explanation was the growing feeling that the welfare state approach of the New and Fair deals had not changed the essential characteristics, or power structure, of America’s corporate political economy. By the end of 1946, in any event, even government spokesmen warned that the United States might “produce itself into a bust” if it did not obtain more foreign markets and overseas investment opportunities. Complementing that fear was the increasing concern over America’s “staggering” consumption and waste of raw materials. Open-door expansion, it appeared, was the answer to all problems—the Russians, markets, and raw materials.

That traditional outlook was given further support by two events early in 1947. First, the President’s Council of Economic Advisors expressed concern about the probability of a serious economic slump. Second, western Europe failed to recover from the war and take its place in the American scheme of things. Hence the problem was to coerce the Russians, help western Europe, and thereby establish the reality of an open-door system throughout the world. These two themes converged during the spring of 1947 in George F. Kennan’s famous policy of containment and Dean Acheson’s proposal for solving the “hard task of building a successfully functioning system” at home by reinvigorating America’s expansion. These and other American leaders shared John Foster Dulles’ view of February 1947, that “peace lies not in compromising but in invigorating our historic policies.”

Among the many ironies of Kennan’s policy of containment, perhaps the greatest is the fact that he had so internalized the assumptions and principles of the Open Door Policy that he thought he was proposing a radically different program. This indeed is the final act in the transformation of a utopia into an ideology. As Kennan himself later acknowledged, containment and liberation are “the two sides of the same coin”; and it was Kennan—not Dulles—who first stressed the traditional open-door faith in America’s overwhelming economic power to force the Soviet Union along a path preferred by the United States. Even in 1957, when he felt “at liberty” to admit that containment had not prevented Russian economic development, Kennan reasserted the traditional objectives of the Open Door Policy in Europe.

Kennan’s condemnation of earlier exponents of the Open Door Policy who moralized about foreign policy (and other nations) provided another striking paradox. For, as a fellow foreign-service officer noted, Kennan was “constantly making moral judgments about the behavior of states.” Thus, for example, he judged the Soviet system “wrong, deeply wrong,” and ruled by a “conspiracy within a conspiracy.” His blanket denial that the Soviets had ever considered that they could work with the United States was another such moral judgment, as well as being an error of fact.

Kennan’s later remark that one of his objectives in 1947 was to counter the tendency of Americans “to take a despairing and dramatic view of Soviet relations” indicates still another facet of the ideological nature of the thought of American leaders. For he described the Soviets as moving “inexorably along the prescribed path, like a persistent toy automobile wound up and headed in a given direction, stopping only when it meets with some unanswerable force.” Hence it was absolutely necessary, he warned, to “confront the Russians with unalterable counterforce at every point where they show signs of encroaching” and to block the Soviet Union with “superior force” and with “unassailable barriers in its path.” This language was not only dramatic and despairing, but it had a very great deal to do with the “overmilitarization of our thinking about the Cold War,” about which Kennan complained ten years later.

The policy of containment was supplemented in 1947 by the Truman Administration’s stress on the necessity of economic expansion. Aware of the warning made by government economists that “without a new aid program there would be a sharp drop in American exports,” the President explained and stressed that problem very candidly before he enunciated the Truman Doctrine. In two speeches prior to that dramatic performance, the President asserted the need to “act and act decisively” to sustain the Open Door Policy. “The pattern of international trade which is most conducive to freedom of enterprise,” he pointed out, “is one in which major decisions are made not by governments but by private buyers and sellers.” On the assumption that America was “the giant of the economic world,” Truman announced that “the choice is ours” to sustain and expand private enterprise.

Hence it is misleading to overemphasize the differences between the Truman Doctrine and the Marshall Plan. They were the two sides of the same coin of America’s traditional program of open-door expansion. As the direct descendant of Winston Churchill’s militantly anti-Russia “Iron Curtain” speech of March 1946, the Truman Doctrine blamed the Soviet Union for the troubles of the world and announced the determination of the United States to halt the spread of revolutionary radicalism. It was the ideological manifesto of American strategy, described by the head of Time’s Washington bureau as a program to promote “trouble on the other side of the Iron Curtain.” As Acheson revealed to the Congress, the American Government entered upon “no consultation and no inquiry” about the possibility of achieving the stated objectives either through negotiations with the Russians or within the framework of the United Nations. The approach proceeded from the assumption, openly avowed by Harriman in 1945, and by Truman in 1946, that the cold war was inevitable.

Considered in isolation, however, the Truman Doctrine provides a one-sided impression of American policy. Some of its crusading fervor seems clearly to have been the result of a conviction, most candidly expressed by Senator Vandenberg, that it would be necessary to “scare hell out of the American people.” On the other hand, it contained no references to the economic difficulties that worried American leaders. It concentrated instead on the political dangers of communism.

For his part, however, Secretary of State George C. Marshall did not initially emphasize the Russian danger. In his speech at Harvard on June 5, 1947, he offered the aid program as an expression of America’s warm humanitarianism. There can be no question but that it did represent America’s generous urge to help the peoples of western Europe, and that it did play a vital role in the recovery of that region. Approached solely as a humanitarian gesture, however, the Marshall Plan raises several troubling questions. China and Latin America were excluded, for example, though their needs were certainly great from a humanitarian (or even a policy) point of view. Perhaps Marshall’s own testimony before the Congress provides a broader understanding of the program.

Prior to Marshall’s famous address at Harvard, moreover, the Congress and the Department of State had been preoccupied with the danger of another depression. Undersecretary of State for Economic Affairs Clayton redefined the problem as one of disposing of America’s “great surplus.” “The capitalistic system, whether internally or internationally,” he explained in May 1947, “can only work by the continual creation of disequilibrium in comparative costs of production.” Clayton was saying implicitly what Acheson had argued explicitly in 1944: the profitability of America’s corporate system depended upon overseas economic expansion. Given this consensus among American leaders, it is not too surprising that Marshall took a similar approach before the Congress: “The paramount question before us, I think, can be stated in business terms.” The consequences of failing to carry through on the plan, he explained, would be to confront America, “if not [with] a trade barrier, certainly with a great detriment to our ordinary business, or commerce and trade.”

Marshall and other advocates of the program also spoke openly of the parallel between their policy and America’s earlier westward expansion across the continent. Marshall presented the program in those traditional terms as the way to avoid the loss of democracy at home. Assuming that it offered the only solution to America’s economic difficulties, the Secretary argued that the nation faced an either-or situation. Unless the plan was adopted, he asserted, “the cumulative loss of foreign markets and sources of supply would unquestionably have a depressing influence on our domestic economy and would drive us to increased measures of government control.” By thus defining America’s expansion as the key to prosperity, Marshall defined foreign policy as the key to domestic problems and to the survival of democracy at home. The intellectual continuity of his thought with the frontier thesis and the policies of John Hay, Woodrow Wilson, Herbert Hoover, and Franklin D. Roosevelt was apparent.

Other Americans were even more explicit. Secretary of the Interior Julius A. Krug defended the plan as “essential to our own continued productivity and prosperity.” Another enthusiastic supporter remarked that “it is as if we were building a TVA every Tuesday.” Even in the most restrained temper of judgment, this might well be the biggest “as if” in American history; for whereas TVA qualified as one of what Alvin Hansen has described as “frontiers in our own backyard,” the Marshall Plan was a concerted program to sustain and expand a frontier overseas.

The testimony of liberal and conservative leaders indicated that they viewed the frontier thesis as the answer to the theories and prophecies of Karl Marx. Chester Bowles, for example, warned specifically that it “was wholly possible that within the next ten years Karl Marx’s judgment will have proved correct.” Concretely, he thought the United States was “heading toward some sort of recession which can be eased by quick approval of the Marshall Plan.” Nelson Rockefeller explained that “with the closing of our own frontier, there is hope that other frontiers still exist in the world.” Spruille Braden also saw the program as a way to “repeat what had been done in the development of our own great west.”

One of Truman’s Cabinet members preferred to think of the whole operation as a “logical extension of the good-neighbor policy, that the Fair Deal for all cannot flourish in isolation.” Another Cabinet official saw it as the “restoration of Europe as a paying market for United States goods.” And such widely different men as William Henry Chamberlain and Marquis Childs pointed directly to the analysis and program advocated by Brooks Adams in 1900 as a wise guide for 1947. Writing in The Wall Street Journal, Chamberlain thought it was “high time to face the problem created by what Brooks Adams called ‘America’s vast and growing surplus.’” Childs republished Adams’s recommendations for the deployment of “America’s economic supremacy” in behalf of the open door, and pointedly remarked that Adams “would have .  .  . to alter scarcely anything to relate his views to the world of today.” Perhaps Childs, along with others, was struck by Adams’s praise for Britain’s traditional policy of “containing” the Russians.

From the beginning, for that matter, many American leaders stressed the desirability and possibility of making the countries of eastern Europe “independent of Soviet control” and the importance of the “struggle for the preservation of Western civilization.” Even a casual reading of the Congressional Record makes it clear that John Foster Dulles was a latter-day missionary for the doctrine of liberation. Coupled with this thought was a general acceptance of the idea of ending Soviet rule in Russia. Hardly any American leader failed to contribute his insights to the “cheerful discussion of how America ought, and ought not, to try to remake Russia.” Some thought it might be necessary, and certainly magnanimous, to allow the Russians to retain some features of socialism. Others proposed a Heavenly City of the American Century. All agreed on the morality and the practicality of the objective.

This emphasis on open-door expansion and the assumption of the inevitable downfall of the Soviet Union again indicated that American leaders were not motivated by fear of a Russian military attack. When asked point blank, even after the Russians had tested their first nuclear bombs and the Chinese communists had defeated Chiang Kai-shek, whether or not “our position on foreign policy with respect to communism is not relative to Churchill’s in 1940,” Secretary Acheson replied in the negative. “I do not mean to infer at all that there is that desperate a situation. I said I was not discouraged and was not taking a pessimistic view at all.” “The problem which confronts us,” he explained, “can be stated very simply: To maintain the volume of American exports which the free world needs and which it is our national interest to supply as a necessary part of building a successfully functioning political and economic system, the free world must obtain the dollars to pay for these exports.”

For their part, the Russians clearly interpreted the Marshall Plan as the over-all economic equivalent of Baruch’s proposal on atomic energy. It was to them an American strategy for setting and maintaining conditions on economic development in eastern Europe and the Soviet Union. That estimate prompted them first to refuse to participate, and then to embark upon a series of actions which most Americans mistakenly think had already occurred. They initiated a program of general political repression in Rumania. They sharply curtailed freedom of the press in Bulgaria, Rumania, and eastern Germany. They shot the Peasant Party leader Patlov in Bulgaria. And within the year the Communist Party in Czechoslovakia seized a monopoly of political power.

These events typified the nature of the cold war as it continued on into the 1950s. In the United States, President Truman repeatedly blamed all the troubles of the world on the Soviet Union, and American leaders in and out of government “bombarded the American people with a ‘hate the enemy’ campaign rarely seen in our history; never, certainly, in peace time.” This American propaganda barrage prompted analyses by two government figures that received little publicity. A congressional committee headed by Representative Forrest A. Harness concluded its long study of the problem with this estimate in 1947: “Government propaganda distorts facts with such authority that the person becomes prejudiced or biased in the direction which the Government propagandists wish to lead national thinking.” Exactly ten years later, General Douglas MacArthur offered an even more biting commentary on the same pattern of distortion. “Our government has kept us in a perpetual state of fear—kept us in a continuous stampede of patriotic fervor—with the cry of a grave national emergency. .  .  . Yet, in retrospect, these disasters seem never to have happened, seem never to have been quite real.” There is ample evidence that the policy-making elite misled and manipulated the American public.

Perhaps it was true that the community of American policy-makers “fell in love with its Cold War plan.” That was the considered conclusion of James P. Warburg, an eminent conservative student of foreign affairs. It was more likely, however, that the ideology of the Open Door Policy had come to be so firmly believed by American leaders that they never questioned either the freedom or the necessity of their program for America and the world.

Certainly the attitude of American leaders toward the underdeveloped societies of the world suggested that explanation. Kennan, for example, took an extreme position on China, discounting almost completely its immediate significance or its potential importance. Others defined the poorer areas in the traditional open-door manner, seeing them as markets for exports and as sources of raw materials. Even when they spoke of the need to help such regions—or provided such assistance—they did so from the point of view of developing them as part of America’s corporate system. It was quite normal, given that conception of the world, for American leaders to consider such regions as dependent variables of the situation in western Europe. The problems and difficulties in the underdeveloped areas could be handled through their existing ties to European empire countries. Time after time, therefore, the United States endeavored to support the crumbling ruins of eighteenth- and nineteenth-century colonialism against the impact of nationalistic and radical onslaughts.

No American leader personified all aspects of the ideology of the Open Door Policy more dramatically than John Foster Dulles, who served as a major advisor to the Truman Administration before becoming Secretary of State under President Dwight David Eisenhower. In the 1920s, he supported the Hughes-Hoover policy of expansion based on a “community of ideals, interests, and purposes” with Germany and Japan, and specifically pushed American penetration of underdeveloped areas in line with his emphasis on the necessity of markets for surplus goods and capital. He followed the same policy throughout the 1930s. Arguing that it was necessary to accept changes in the world, and asserting the Christian way of compromise, he labored diligently as late as 1939 to work out a broad understanding with Nazi Germany and a militarized Japan.

Dulles continued to advocate and practice this approach after 1945. Understandably, he worked very well as an advisor and assistant to Secretary Acheson during the early years of the cold war. His definition of compromise did not include a fundamental rapprochement and accommodation with the Soviet Union, or the acceptance of fundamental changes in the underdeveloped regions. On the threshold of his lifelong ambition to be Secretary of State, Dulles provided in 1952 the definitive statement of the Open Door Policy. Synthesizing the moral imperialism of his missionary background with the necessity of economic expansion of his banking experience, Dulles announced that he would liberate the Russians and the Chinese from “atheistic international communism” and usher in the American Century.

Perhaps Dulles himself provided the most accurate insight into the final failure of the Open Door Policy. Against the background of constant and record-breaking travels all over the world, Dulles undertook yet another mission to Latin America. He was greeted by his official host with the pleasant and gracious remark that it was “good to have you here, Mr. Secretary.” “You shouldn’t feel that way,” Dulles replied, “for I go only where there is trouble.” And trouble indeed there was for America in its policy of the open door.

A bit later, when it appeared that negotiations with Russia could no longer be avoided, Dulles inadvertently laid bare the basic flaw of the open-door conception of the world. He worried about such a meeting with the Soviet Union, he explained, because it might tempt Americans to turn their attention and energies away from the cold war. But only a view of the world which defined freedom and necessity in terms of expansion could lead to that response. For a growing number of Americans were beginning to join millions of others throughout the world in a reassertion of the elementary fact that man was born to achieve and exercise his self-knowledge in more fruitful endeavors than a cold war which persistently threatened to erupt in nuclear horror. Dulles apparently failed to realize that he felt anxiety for the wrong reasons and was pursuing a policy that had now become a denial of the spirit of man.

Though not as extreme as Dulles in their reactions, most other American leaders were slow to grasp the real meaning of the revolutions throughout the world—their ability to destroy a cherished American illusion in Asia, to manage the transfer of power in Russia, to initiate and carry through a major conference of underdeveloped societies without American leadership, and even to defy the United States to use its nuclear weapons in retaliation.

* Dulles apparently mislaid his own advice in subsequent years.

† See, for one of many pieces of evidence concerning this attitude: J. M. Jones, The Fifteen Weeks (New York: Viking Press, 1955), 253.

‡ The best printed sources for this crucial episode are: W. S. Churchill, The Grand Alliance (Boston: Houghton Mifflin Co., 1950); The Memoirs of Cordell Hull (New York: Macmillan Co., Vol. II, 1948); S. Welles, Seven Decisions That Shaped History (New York: Harper and Bros., 1951); and especially Foreign Relations, 1942: Vol. III, Russia (Washington, Gvt. Printing Office, 1961).

§ This and subsequent quotations from Stalin come from the stenographic report of the discussions printed in Foreign Relations, 1942: Russia.

¶ Perhaps the best introduction to the nature and feel of debate within the Soviet Union is A. Erlich, The Soviet Industrialization Debate, 1924–1928 (Cambridge: Harvard University Press, 1960); then, in addition to the materials cited below, see on the World War II phase of such disagreements the following items: Z. K. Brzezinski, The Soviet Bloc. Unity and Conflict (Cambridge: Harvard University Press, 1960, and paperback, 1961); V. Dedijer, Tito (New York: Simon & Schuster, 1953); I. Deutscher, Stalin (New York: Oxford University Press, 1949); M. Gordey, Visa to Moscow (New York: Alfred A. Knopf, 1952); E. Snow, Stalin Must Have Peace (New York: Random House, 1947); and A. Werth, The Year of Stalingrad (New York: Alfred A. Knopf, 1947).

# On these matters consult the very illuminating, but all too often neglected volume by E. F. Penrose, Economic Planning for the Peace (Princeton: Princeton University Press, 1953).

** Here see M. F. Herz, Beginnings of the Cold War (Bloomington: Indiana University Press, 1966).

†† The reader who does not have access to, or cannot read, Soviet sources (upon which this discussion is based), can follow the debate in these items: L. A. Leontiev (et. al.), “Teaching of Economics in the Soviet Union,” [Under the Banner of Marxism, Nos. 7–8 (1943)], translated and printed in The American Economic Review (September, 1944); P. Baran, “New Trends in Russian Economic Thinking?”, American Economic Review (December, 1944); R. Dunayevskaya, “A New Revision of Marxian Economics,” American Economic Review (November, 1944); and A. Zauberman, “Economic Thought in the Soviet Union,” The Review of Economic Studies, Nos. 39–41 (1948–50).

‡‡ The Varga Controversy, as it came to be called, has received considerable attention from American students of the Soviet Union. Varga’s book was published as Changes in the Economy of Capitalism Resulting from the Second World War. An English translation of the stenographic report of a vigorous debate on the book, in which Varga participated, and which took place on May 7, 14, and 21 of 1947, appeared as Soviet Views on the Post-War World Economy (Washington: Public Affairs Press, 1948). The reader who wants real insight into the extent to which Soviet leaders do disagree among themselves, and into the vigorous nature of their discussions, should consult the translation. Of the many comments on the debate, the reader may find it useful to begin with these: F. C. Barghoorn, “The Varga Discussion and Its Significance,” American Slavic and East European Review (March 1948); H. Marcuse, Soviet Marxism. A Critical Analysis (New York: Columbia University Press, 1958); and B. Moore, Soviet Politics—The Dilemma of Power (Cambridge: Harvard University Press, 1950). Quite surprisingly, D. F. Fleming does not examine these internal debates in his massive and impressive study, The Cold War and Its Origins, 1917–1960 (New York: Doubleday and Co., 2 Vols., 1961). He does provide, however, a vast amount of supporting evidence in his discussion of Soviet policy at the end of the war. Further material is in I. Deutscher, Russia: What Next? (New York: Oxford University Press, 1953); and B. Moore, Terror and Progress: USSR (Cambridge: Harvard University Press, 1954).

§§ The quotation is from R. Slusser (ed.), Soviet Economic Policy in Postwar Germany. A Collection of Papers by Former Soviet Officials (New York: Research Program on the USSR, 1953). Also see: R. A. Rosa, “The Soviet Theory of ‘People’s Democracy’,” World Politics (1949); H. G. Skilling, “People’s Democracy, The Proletarian Dictatorship and the Czechoslovak Path to Socialism,” American Slavic and East European Review (1951); and Brzezinski, The Soviet Bloc.

¶¶ See, as a typical report of such discussions within the American policymaking community, the story in the New York Times, September 27, 1945 (p. 4), from which the quotation is taken.

## See, as typical of such remarks, the comments of Karl E. Mundt, A. A. Berle, Jr., John M. Vorys, and Charles A. Eaton, in Extension of Lend-Lease Act. Hearings Before the Committee on Foreign Affairs. House of Representatives 78th Cong., 1st Ses. (1943).

*** A convenient, though merely surface, survey is: C. E. Silberman and L. A. Mayer, “The Migration of U.S. Capital,” Fortune (1958). On investments, see the authoritative U.S. Business Investments in Foreign Countries (Washington: Department of Commerce, 1960). More helpful are M. Wilkins, The Emergence of Multinational Enterprise (Cambridge: Harvard University Press, 1970); and C. P. Kindleberger (Ed.), The International Corporation (Cambridge: The M.I.T. Press, 1970).

††† All of the testimony during these hearings, however, is very pertinent. Post-War Economic Policy and Planning. Hearings Before the Special Subcommittee on Post-War Economic Policy and Planning. House of Representatives, 78th Cong., 2nd Sess. (1944).

‡‡‡ When compared with their subsequent political and historical rhetoric about the success of the New Deal itself, the candid and sworn testimony of New Deal leaders after 1943 offers a valuable corrective. More historians should examine it.

§§§ There is now a sizable body of literature on this theme. Begin with L. C. Gardner, Architects of Illusion (Chicago: Quadrangle Books, 1970); then go to G. Alperovitz, Atomic Diplomacy: Hiroshima and Potsdam (New York: Simon and Schuster, 1965), and his collection of essays Cold War Essays (Garden City: Anchor Books, 1970), and the items in the bibliography.

¶¶¶ This reconstruction of the affair is based in the main upon the following sources: Memoirs by Harry S Truman. Volume One. The Year of Decisions (New York: Doubleday and Co., 1955); William D. Leahy, Manuscript Diaries, 1941–1945, State Historical Society of the State of Wisconsin, Madison; Foreign Relations. The Conference at Malta and Yalta (Washington: Government Printing Office, 1958); Extension of the Lend Lease Act. Hearings Before the Committee on Foreign Affairs. House of Representatives. 79th Cong., 1st Sess.; Export-Import Bank of 1945. Hearings Before the Committee on Banking and Currency. House of Representatives. 79th Cong., 1st Sess.; Export-Import Bank. Hearings Before the Senate Committee on Banking and Currency. 79th Cone., 1st Sess.; and materials from the Manuscript Papers of Henry L. Stimson and Joseph Grew, Harvard University Library.

### The following quotations come from a stenographic record of the conversations reproduced in R. E. Sherwood, Roosevelt and Hopkins. An Intimate History (New York: Harper and Bros., 1948), 893–94.

**** This account of the Potsdam and London conferences, which took place between July and November 1945, is based upon a wide selection of primary and secondary materials. The reader without recourse to manuscript collections can find the main elements of the story, and most of the quotations used here, in these published volumes: J. F. Byrnes, Speaking Frankly, and All In One Lifetime (New York: Harper and Bros., 1947 and 1958); W. S. Churchill, Triumph and Tragedy (Boston: Houghton Mifflin, 1953); H. L. Stimson and M. Bundy, On Active Service In Peace and War (New York: Harper and Bros., 1948), Memoirs of Harry S Truman; and the most illuminating volumes, Foreign Relations. The Conference of Berlin (The Potsdam Conference), 1945. Two Volumes (Washington: Gvt. Printing Office, 1960), which also print revealing excerpts from Stimson’s Diary.

†††† Italics added to the material quoted, as well as to my words.

‡‡‡‡ J. F. Byrnes, “We Were Anxious to Get the War Over,” U.S. News and World Report (August 15, 1960). See also the remarks of Leo Szilard in the same issue for further evidence on the point.

§§§§ On this point see: H. J. Morgenthau, “The End of an Illusion,” Commentary (November 1961).

¶¶¶¶ W. H. McNeill, in his excellent volume, America, Britain, and Russia. Their Co-operation and Conflict, 1941–46 (London: Oxford University Press, 1953), was perhaps the first to sense the importance of Clay’s action,

#### U.S. Congress: Senate Report No. 1211 (19 April 1946).

***** J. R. Oppenheimer, “The Control of Atomic Energy,” Foreign Affairs (January 1948).

††††† Perhaps the best single essay on these points is T. Balogh, “The Political Economy of the Cold War,” in Fabian International Essays (ed. by T. E. M. McKitterick and K. Younger: New York, Praeger, 1957).

‡‡‡‡‡ An early and cogent estimate of this relative balance of military power between America and Russia is P. M. S. Blackett, “Steps Toward Disarmament,” Scientific American (April, 1962).

§§§§§ See, as representative: V. Alexandrova, “The Russian People and the ‘Lost Peace’—In Literature,” Modern Review (1949); and P. E. Corbett, “The Aleksandrov Story,” World Politics (1949).

¶¶¶¶¶ Here see R. N. Gardner, Sterling-Dollar Diplomacy (Oxford: Oxford University Press, 1956).

##### This parallel between Acheson and Adams becomes even more fascinating in the light of two other similar episodes. Adams in 1900 used the words contain and containing to describe how the United States should deal with Russia. George F. Kennan used precisely the same terminology in 1946 and 1947 in writing his famous “X” article which enunciated the policy that took the word containment as its name. In the same year, 1947, the New Deal newspaper columnist Marquis Childs republished Adams’s essay, American’s Economic Supremacy, as a guide to the proper policy for the United States in the cold war. My efforts to find out whether these episodes involved more than coincidence have not been successful. In either case, the continuity of American foreign policy is established beyond question.

****** J. F. Byrnes, All in One Lifetime, 291–99; Truman’s Memoirs, 315–19, 423–25; and Foreign Relations. The Conference at Potsdam, Volume II, 276.