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The BrettonWoods agreements were important because they served as abas is for building broader coalitions around a relatively open and managed order. It was a middle path that generated support from both the conservative free traders and the new enthusiasts of economic planning. It was agreed that just lowering barriers to trade and capital movements was notenough. The leading industrial states must actively supervise and govern the system. Institutions, rules, and active involvement of governments were necessary. One lesson came from the 1930s: the fear of economic contagion,where unwise or untoward policies pursued by one country threatenedthe stability of others. As Roosevelt said at the opening of the Bretton Woods conference, the economic health of every country is a proper matterof concern to all its neighbors, near and far.”
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But the settlement also provided governments with the ability to deliver on the new promises ofthe welfare state, pursuing expansionary macroeconomic policies and protectingsocial welfare.
More generally, the emphasis on creating an order that provided economicstability and security was, as seen earlier, a central objective of Americanplanners, whose main concern was with postwar security and a Europeanthird force.” Liberal free traders came to this view by recognizingthe new necessity of a managed capitalist order that was organized in sucha way as to give governments the ability to pursue economic growth andstability. Security officials came to this view by recognizing that the greatest security threats to Europe (and indirectly the United States) came frominside these societies, through economic crisis and political disarray.
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In seeking agreement over postwar economic relations, the United States moved in the direction of Britain and the Europeans. The Britishwere instrumental in seeking out the parts of the American government that were most congenial with their aims. The result was a system that wasmore or less open, provided institutions to manage this openness, but also offered enough loopholes to allow governments to protect their weak economies.
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The United States gained its agreement and the European gained commitments, mechanisms, and obligations institutionalized in the postwarorder.
FROM THIRD FORCE TO SECURITY COMMITMENT
In 1947 and the following years, the United States appeared to hold themilitary and economic power needed to shape the terms of European reconstruction.
With a monopoly on the atomic bomb, a massive (althoughdemobilizing) standing army, and an industrial economy enlarged by thewar, the United States appeared to have all the elements of hegemonicpower. Moreover, the United States had what Europeans needed most: American dollars. More and more as weeks succeed weeks,” the Economist noted in May 1947, the whole of European life is being overshadowed
by the great dollar shortage. The margin between recovery and collapsethroughout Western Europe is dependent at this moment upon massive imports from the U.S.”
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It is all the more striking, therefore, how successful European governments were at blunting and redirecting American policy toward Europe.
This resistance by Europe to the construction of a European third forcehad several sources and differed from country to country. Each sought to use American power to make it predictable, to establish ongoing commitments for its own national purposes. The same considerations that led tothe rejection of a full-blown united Europe prompted these same governmentsto encourage a direct American political and security commitmentto Europe.
The British were the most resistant to a united Europe, but reacted positivelyto the larger political objectives of Marshall Plan aid. A secret Cabinetsession in March 1948 concluded that Britain should use United Statesaid to gain time, but our ultimate aim should be to attain a position inwhich the countries of western Europe could be independent both of theUnited States and the Soviet Union.”
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Yet as a practical matter, the Britishresisted significant steps in that direction. In a meeting of American ambassadorsin Europe in October 1949, Ambassador David Bruce argued: Wehave been too tender with Britain since the war: she has been the constantstumbling block in the economic organization of Europe.”
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The British were eager to maintain their special relationship with theUnited States. They feared that it would be undermined by the emergenceof a confederation with European states. Moreover, the political and economic burdens of sustaining a European center of power would only furtherstrain the British Commonwealth system. As with several of the otherEuropean countries, the British also feared the eventual dominance of Germanyor even Russia in a unified Europe. These considerations impliedthe need for more, not less, American involvement in postwar Europe,particularly in the form of the NATO security relationship. As DavidCalleo notes: NATOseemed an ideal solution.With American commandersand forces taking primary responsibility for European ground defense,no question would remain about America’s willingness to come to Europe’said. Britain would reserve for itself those military and naval commandsneeded to retain control over its own national defense.
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Indeed, in 1952the British sought to reduce the role of the Organization for European
Economic Cooperation and transfer its functions to NATO a clear attemptto build the Atlantic relationship at the expense of European unity.
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British officials were more concerned with preventing a return by the United States to an isolationist position than with an overbearing American hegemonic presence in Europe. The fear was not of American expansionism,”
Gaddis notes, but of American isolationism, and much time wasspent considering how such expansionist tendencies could be reinforced.
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Just as they had duringWorldWar I, the British and other Europeans gaveencouraging responses to American ideas about postwar security cooperationand peacekeeping, as two historians argue, if only because it wouldbind the United States to participate in world affairs as she had omitted todo in the years between the wars.”
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It is no surprise, therefore, that inencouraging the United States to lead a security protectorate of Europe,the British began to stress the seriousness of the Soviet threat in Europe.
In January 1948, British Foreign Minister Ernest Bevin warnedWashingtonof the further encroachment of the Soviet tide and the need to reinforcethe physical barriers which still guard Western civilization.”
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The French also actively courted an American security guarantee. To besure, many French were sympathetic to the goal of a more unified Europe.
Integration was useful in fostering French influence across Europe, and apolitical and economic union would also allow France to have some influenceover the revival of the German economy as well as tie Germany to alarger regional framework.
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But the French insisted that the rehabilitationof western Germany would only be acceptable within a security frameworkthat involved the United States. An American security tie, even more thana unified Europe, was needed to contain both the Germans and the Soviets.
As in the British case, an American security guarantee would also free upsome resources, otherwise tied to European defense, that could be used forpreserving the remains of its colonial empire.
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Connected to Europe, theUnited States would be more predictable and its resources more available.
Throughout the postwar years, European pressure for a durable Americansecurity tie was connected to the problem of postwar Germany. In
frequent meetings of foreign ministers during 1946 and 1947, Americanand British officials were unable to bridge differences with the Soviet Union over the joint management of occupied Germany.
95 At the sametime, the economic weakness in western Europe made the rebuilding andreintegration of western Germany particularly the industrial and coalrich
Ruhr region into Europe increasingly important to the economic revival and political stability of Europe.