Political, Economic, and Military Division of Europe

< IB‎ | Group 3‎ | History‎ | Route 2‎ | The Cold War

By the end of 1949, Europe had been divided into two separate 'spheres of influence.' In September 1949, following the Berlin Blockade, the Federal Republic of Germany (FDR), also known as West Germany, was established. A month later, the German Democratic Republic (GDR), also known as East Germany, was established. Thus the two Germany's became the heart of the physical dividing line between the two superpower blocks. The eight key steps listed below show the events that led to this division:

  • NATO Established, April
  • West Germany established, September
  • East Germany established, October
Berlin Blockade, June 1948 8
Czech Coup, February 1948 7
Red Army Occupation of Eastern Europe, 1945–1947 6
Marshall Plan, June 1947 5
Truman Doctrine, March 1947 and Cominform, October 1947 4
Churchill's Iron Curtain Speed at Fulton, Missouri, March 1946 3
Kennan's Long Telegram, February 1946 2
Wartime Conferences: Tehran 1943, Yalta 1945, Potsdam 1945 1

The Breakdown of the Grand Alliance

Summary of The Breakdown of the Grand Alliance

When the Nazis attacked Russia in June 1941, both British Prime Minister Winston S. Churchill and Roosevelt sent aid to the Soviets. This marked the beginning of the Grand Alliance. However, this did not mark a change in how Stalin's Soviet Union was seen, particularly by the British. Churchill retained his dislike of the Soviet leader, remarking to his secretary, 'If Hitler invaded Hell, I would make at least favourable reference to the Devil in the House of Commons.' Thus, relations between the West and the USSR were still clouded by mutual suspicion, as they had been in the 1920s and 1930s.

Despite the fact that the two Western powers sent a considerable amount of aid to the USSR, Stalin demanded more action – nothing less than the opening of a 'second front' in Europe to take some of the pressure off the USSR in the east. The Allies agreed to this 'in principle,' but said that they would not be able to open this 'second front' until the time was deemed right. Stalin was suspicious that they were deliberately delaying this offensive in the hope of seeing the Soviet Union permanently weakened by the continuing German onslaught.

At the first of the three wartime conferences, Tehran in 1943, relationships between the Big Three seemed to improve a little, as the Western leaders proposed a definite date for the Normandy invasion: May 1944. In return, Stalin promised to declare war on Japan once Germany was defeated.

Step One: The Wartime Conferences


During the war, the decisions of the Grand Alliance determined the territorial and political structure of post-war Europe. There were three historic conferences between the Allies before the end of World War Two. The key issues under discussion at the conferences fall into the following categories:

  • the state of the war,
  • the status of Germany, Poland, Eastern Europe, and Japan, and
  • the United Nations.

The Tehran Conference (1943)

Summary of The Tehran Conference (1943)

The first conference was held in Tehran, Iran in November 1943. Those present were Josef Stalin representing the USSR, President Franklin Roosevelt representing the USA and Prime Minister Winston Churchill representing the United Kingdom. This was the first meeting of what became known as the Big Three. Their discussions focused on these key areas:

The State of the War


By 1943, the Allies had begun to win the war, following critical turning-point victories in 1942. The Soviets were now pushing the Germans into retreat on the Eastern front, while the Americans and the British had driven the Germans from North Africa and had invaded Mussolini's Italy. However, the UK and the USA had not yet launched the kind of second front that Stalin had been demanding. Therefore, Stalin continued to press his allies to take on more of the burden of confronting the German war machine from the USSR by invading north-western Europe. There was discussion of the war against Japan in the Pacific, which had entered its brutal 'island hopping' phase.



The key question for the Allies was what to do with Germany after it had been defeated. The Soviets had very different views about the future of Germany from those of the USA and Britain. Many of these differences stemmed from the varied wartime experiences of the Allies, the 'lessons' that seemed to have been learned from the failure of the Treaty of Versailles, and their widely differing ideologies. Thus there was no agreement on the future of a defeated Germany. However, they did confirm that 'unconditional surrender' of Germany was their objective. Roosevelt also supported 'Operation Overlord' (the Allied invasion of northern France that began with D-Day on the 6th of June 1944) as a priority.



Stalin's main concern was 'security.' This coloured not only his demands over the future of Germany but also over the shape of Poland's post-war borders. Stalin wanted to secure his western border by gaining territory from Poland, and by ensuring that Poland had a pro-Soviet government. He argued that Poland had been the traditional launching pad for the invasions of Russia. It was thus agreed that the USSR was to keep territory seized in 1939, and Poland in turn would be given territory on its western border from Germany. By agreeing to this, the Allies created a situation that no truly independent Poland could agree to and also ensured future hostility between Germany and Poland. Thus, a puppet regime in Poland looked like a real possibility, and that regime presumably would have to look at the USSR for security. Tensions between the Poles and Soviets were increased in 1943 with the discovery of the mass grave of nearly 22,000 Polish soldiers in the Katyn Forest. These soldiers had been captured by the Soviets in late 1939. The Soviets blamed the Germans for the massacre, but many Poles suspected (rightly) that the Soviets were responsible.

Eastern Europe


The Soviets demanded the right to keep the territory that they had seized between 1939 and 1940. This meant remaining in control Finland and Romania in Eastern Europe. With much reluctance, the Americans and the British agreed to the Soviet annexation of these territories. However, this was against the 1941 'Atlantic Charter' agreement between the United States and the United Kingdom.



The United States and the United Kingdom pressed the USSR to enter the war with Japan. They wanted Stalin to open a Soviet 'second front' in Asia. However, Stalin could not be convinced to do this until the war with Germany was won.

The United Nations


The Americans, in particular, were very keen to establish a replacement for the League of Nations. The British and the Soviets gave their general approval for the idea of a new international organisation being established. This would, again, be designed to settle international disputes through collective security. The USA hoped that lessons would have been learned from the 'mistakes' that were made in the structure and make up of the League of Nations and the proposed United Nations Organisation and could more successfully fulfill this belief.



There were two main positive outcomes from the Tehran Conference:

  • agreement on a new international organisation, and
  • agreement on the need to for a weak post-war Germany.

Roosevelt and Stalin seemed to work reasonably well together. Indeed, on his return to the USA, Roosevelt publicly stated in a radio broadcast that '[he] got along fine with Marshal Stalin ... [he believed] that [they were] going to get along very well ..., and with the Russian people..." However, as the war continued, the next meeting of the Big Three revealed a growing gap between Stalin's post-war aims and those of the Western powers, though these differences seemed more acute between Stalin and Churchill. Churchill did not trust Stalin, and Roosevelt hoped to play the role of 'mediator' between the British and the Russians. Roosevelt seemed to believe that the more serious problem for post-war stability was British imperialism, rather than Soviet strength. Roosevelt is supposed to have told Stanislaw Mikolajczyk, the leader in London of the Poles in exile, "...of one thing I am certain, Stalin is not an imperialist." Roosevelt did not appear overly concerned about the future of Poland, nor was he worried about the Allies taking the German capital, Berlin, before the Soviets.

The Yalta Conference (1945)

Summary of The Yalta Conference (1945)
  • State of the war: Germany on verge of being defeated, the Second Front had been opened by 1944, Japan under heavy aerial bombardment from the Americans as the Americans held control of air and sea in the pacific.
  • Germany: Decided that she would be disarmed, demilitarised, de-Nazified, and divided. Four "temporary" zones of occupation would be created, and Stalin demanded 50% of the $20 billion reparations that Germany had to pay.
  • Poland: New frontiers were decided, at the Cruzon Line where had been before in Russo-Polish War (1921). Gained territory from Germany, giving Stalin what he wanted (territorially), thus allowing Poland to hold "free elections" with a more democratic government. However, Britain and Russia supported two different parties: 'London Poles,' and communist-led 'Lublin Committee'.
  • Eastern Europe: Stalin said these countries would be able to decide with "free elections," was a major victory for US and Britain.
  • Japan: Stalin promised to join the war, but demanded reward territory. These terms were accepted.
  • United Nations: Stalin agreed to join the UN, and gave the power to veto to five permanent members. Stalin wanted all 16 Soviet Republics to have separate seats in UN General Assembly, but only 3 were given; Russia, Ukraine, Belarus.
  • Conclusion: Agreement over the UN, Soviets agreed to join the war in the Pacific, the Big There signed the "Declaration for Liberated Europe", pledging free elections in Eastern Europe.
Churchill, Roosevelt, and Stalin at the Yalta Conference in 1945.

By the time of the February 1945 Yalta Conference on the Black Sea in the southern Ukraine, Stalin's diplomatic position was greatly strengthened by the physical fact that the Red Army occupied most of Eastern Europe. Once again, the Big Three powers were represented by Stalin, Roosevelt, and Churchill. The topics under discussion were the same as Tehran:

The State of the War


Germany was now on the verge of being defeated. With the Normandy landings in 1944, a second front had finally been opened. The Soviets had driven the Germans from Eastern Europe, and were now ready to invade Germany itself. The British and Americans had forced the Germans from France, and were now poised to cross the Rhine and invade Germany from the west. Japan was still fighting on, but had been under heavy aerial bombardment from the Americans. The USA was now in control of the air and sea in the Pacific, and the Japanese were preparing for the final desperate defence of their homeland.



The Allies decided that Germany would be disarmed, demilitarized, de-Nazified, and divided. It was agreed that post-war Germany would be divided into four zones of occupation between the USA, the USSR, the UK, and France. This division was to be 'temporary,' and Germany was to be run as one country. An Allied Control Commission (ACC) would be set up to govern Germany. Stalin demanded a large percentage of reparations from Germany after the devastation that the war in the East had wreaked on the Russians. It was agreed that Germany would pay $20 bill, and 50 per cent would go to the USSR.



Poland presented the greatest problem – where would the lines of its borders be drawn, and what would be the political make-up of her post-war government? At Yalta the new frontiers of Poland were decided. The border between Poland and the USSR was to be drawn at the 'Curzon Line.' This put the frontier back to where it had been before the Russo-Polish War of 1921. The Poles were to be compensated by gaining territory from Germany. This would be east of the 'Oder-Neisse Line.' Thus, Stalin had got what he had wanted territorially. In return, he agreed to the establishment of a more democratic government in Poland, following 'free elections.' This developed into the key area of disagreement between the British and the Soviets. The British supported the group known as the 'London Poles,' who were the pre-war government that had fled to England in 1939, while the Russians wanted the Communist-dominated Lublin Committee in Poland to form the new post-war government.

Eastern Europe


There seemed to be agreement at Yalta over the future of the governments of Eastern Europe. Stalin agreed that the countries of Eastern Europe would be able to decide who government them in 'free elections.' This was perceived as a major victory for the USA and Britain. Indeed, for the British and Americans this was seen as the most significant of the wartime deals made with the Soviet Union.



Stalin now promised to enter the war with Japan, as soon as the war in Europe was won. However, the Soviets demanded territory in return from Japan as a 'reward.' This would include South Sakhalin, and the Kurile Islands. The Americans and the British accepted these terms.

The United Nations


Stalin agreed that the Soviet Union would join the United Nations Organisation. The Allies agreed that there would be five permanent members of the Security Council, each with the power to veto. Stalin went on to demand that all 16 Soviet Republics have separate seats in the UN General Assembly. The British and Americans agreed in the end to only three seats for individual republics; Russia, Ukraine, and Belarus.



There were three main positive outcomes of the Yalta Conference;

  • the agreement on the United Nations,
  • the Soviet's agreement to join the war in the Pacific against Japan, and
  • the Big Three signing a 'Declaration for Liberated Europe' pledging their support for democratic governments based on free elections in all European countries, including Eastern Europe.

What were the crucial developments that took place between the Yalta and Potsdam Conferences?

Summary of What were the crucial developments that took place between the Yalta and Potsdam Conferences?

There were some crucial events that radically changed the atmosphere of, and the influences on, the next meeting of the Allies in 1945.

  • President Roosevelt died in April 1945, and he was placed by vice-president Harry S. Truman, who was to adopt a more hardline, or 'get tough,' policy towards the Soviets,
  • Germany finally surrendered unconditionally on the 8th of May 1945,
  • Winston Churchill's Conservative Party lost the 1945 UK general election and Churchill was succeeded as Prime Minister by the Labour Party leader, Clement Attlee,
  • As the war in Europe ended, the Soviet Red Army occupied territory as far west as deep inside Germany, and
  • On the very day after the Potsdam Conference began, the 17th of July 1945, the United States successfully tested its first atomic bomb.

The Potsdam Conference (1945)

Summary of The Potsdam Conference (1945)
The Potsdam Conference, 1945: seated are Winston Churchill, Harry S. Truman, and Joseph Stalin.

The Potsdam Conference took place in July 1945 in Potsdam, Germany. Those participating were Joseph Stalin representing the USSR, President Harry S. Truman representing the USA, and Prime Minister Clement Attlee representing the UK.

The State of the War


In May 1945, Germany surrendered 'unconditionally.' Although war in the Pacific raged on, the Americans were now poised to invaded the mainland. By the time the Potsdam Conference began, the USA was planning to use their new atomic weapon against Japan – if the tests on it proved successful.



The Allies had agreed at Yalta to disarm, demilitarise, de-Nazify and divide Germany, but at Potsdam they could not agree how this should be done. Soviets initially demanded that the reparations (in production means and raw materials) are to be collected from the Germany as a whole, of which reparations USSR would receive 50%. The West powers insisted on each occupying power satisfying their needs within the borders of their occupation zone, trying to protect Western Germany industrial potential. Finally it was decided that they would carry out the de-Nazification and militarisation of Germany in their own ways in their own respective zones of occupation. The German economy was to be run as a 'whole,' but it was to be limited to domestic industry and agriculture (at 74 percent of 1936 levels). The Soviets were to receive 25 per cent of their reparation bill from the Western zones. The more agricultural Eastern zone was to give food in exchange.



The new US president, Harry S. Truman, was not happy with the agreements over Poland, so he challenged the decision over the new western frontier between Poland and Germany (the Oder-Neisse line). Truman also insisted that the Polish government be 'organized.' In other words, the Americans wanted an entirely new government. They did not feel that there had been a 'free and democratic' vote, and Stalin's offer to include more 'London' Poles within the predominantly 'Lublin'-led government did not appease the US.

Eastern Europe


The new U.S. leadership was also unhappy about the so-called 'Percentages Agreement' that had been made bilaterally between Stalin and Churchill in October 1944. Spheres of influence had been discussed in terms of 'percentages' when deciding the future fate of countries in East and South-eastern Europe. Truman challenged the influence that this agreement had given Stalin over Romania and Bulgaria. However, Soviet military control of Eastern Europe was a fact − the Red Army was literally standing on the territories



Truman was told during this conference that the atomic bomb tests had been successful. On the 6th of August 1945 the first atomic bomb used in war was dropped on Hiroshima. Three days later a different type of nuclear bomb was dropped on Nagasaki. Soon after the Japaneseʑ finally agreed to 'unconditional surrender.' However, although the Americans liaised with their British allies, Truman did not tell Stalin the 'full story' about this new 'super weapon.' And, for the first time, at this conference the Americans did not encourage the Soviets to join the war against Japan.

United Nations


The United Nations became a reality. It was officially created at the Treaty of San Francisco in 1945. The USSR was the only Communist power of the 'Big 5.' the permanent members of the UN Security Council. Stalin used the power of the veto which gave the USSR to block any initiatives that her perceived to be against Soviet interests.



There were two main positive outcomes from the Potsdam Conference:

  • The agreement for the immediate, practical control of the defeated Germany, and
  • The immediate establishment of the United Nations.

Key developments (1946−47)


Salami tactics

Summary of Salami tactics

One way the Soviet Union gained increasing political control over Eastern Europe was by the method known as 'salami tactics.' This term is said to have come from a remark made by the Hungarian Communist leader, Rakosi, commenting about how the USSR secured Communist control in Eastern Europe, 'like slicing off salami, piece by piece':

  • Stage one: The Soviets supervised the organisation of these governments initially establishing a broad alliance of 'anti-fascists.'
  • Stage two: Each of the parties were 'sliced off,' one after the other.
  • Stage three: The Communist 'core' was left, and then ultimately the local Communists were replaced (if need be) with 'Moscow' trained people.

By the end of 1946, the so-called 'Beggage Train' leaders had returned to Eastern Europe. These were the men who had spent much of the war in Moscow, and were considered by the Soviets to be 'trustworthy.' for example, Bierut (who returned to Poland), Kolarov (who returned to Bulgaria), Pauker (who returned to Romania), and Rakosi (who returned to Hungary). These leaders would thus ensure that the post-war governments of their respective countries would be dominated by Moscow-backed, 'Stalinist' Communists.

Targeting instability in Greece and Turkey

Summary of Targeting instability in Greece and Turkey

After World War Two there were anti-imperialist, nationalist, and to a certain extent, 'pro-Communist' rebellions in Greece and Turkey. The British, and to a lesser degree the USA, believed that these rebellions were being directed and supported by the Soviets. Churchill, in particular, was annoyed at Stalin's apparent disregard for their 'Percentages Agreement.'

Community parties in Italy and France

Summary of Community parties in Italy and France

Communist parties in both these 'western democracies' grew stronger in post-war Europe, their membership increasing due to the economic deprivations and hardships at the end of the war in Europe. The Americans and the British were suspicious that these newly popular Communist parties were receiving 'encouragement' from Moscow. Indeed, there was concern that Italy and France could be 'weak links' in anti-Communist Western Europe.

Step Two: Kennan's long telegram (February 1946)

Summary of Step Two: Kennan's long telegram (February 1946)
  • Written by US diplomat George F. Kennan to the U.S. State Department on the nature of Soviet conduct, and helped hard US attitudes towards containment.
  • The USSR's view of the world was a traditional one of insecurity,
  • The Soviets wanted to advance Muscovite Stalinist ideology (not simply 'Marxism'),
  • The Soviet regime was cruel and repressive and justified this by perceiving nothing but evil in the outside world. That view of a hostile outside environment would sustain the internal Stalinist system, and
  • The USSR was fanatically hostile to the West − but they were not 'suicidal ... impervious to the logic of reason Moscow [was] highly sensitive to the logic of force.'

In February 1946, a key U.S. diplomat in Moscow, George F. Kennan, sent a telegram to the U.S. State Department on the nature of Soviet conduct and foreign policy. His views on the motives behind Soviet foreign policy were to have a lasting influence on the State Department. The key idea in this telegram was that the Soviet system was buoyed by the 'threat' of a 'hostile world outside its borders,' and the USSR was 'fanatically and implacably' hostile to the West: "Impervious to logic of reason Moscow [was] highly sensitive to the logic of force. For this reason it can easily withdraw − and usually does − when strong resistance is encountered at any point.'

Kennan's 'logic of force' argument helped to harden attitudes to the USA and was to play a key role in the development of the U.S. policy of containment.

Step Three: Churchill's Iron Curtain speech (March 1946)

Summary of Step Three: Churchill's Iron Curtain speech (March 1946)

On the 5th of March 1946, former British Prime Minister Winston Churchill gave a speech at Westminster College in Fulton, Missouri, with President Harry S. Truman sitting just behind him on the speakers' platform. This speech is now seen as one of the defining moments in the origins of the Cold War.

Churchill spoke of the way he saw the post-war world developing:

"A shadow has fallen upon the scenes so lately lightened by the allied victory. Nobody knows what Soviet Russia and its Communist international organisation intends to do in the immediate future, or what are the limits, if any, to their expansive proselytising tendencies. I have a strong admiration and regard for the valiant Russian people and for my war-time comrade, Marshal Stalin. There is a sympathy and goodwill ... toward the peoples of all the Russias ... We understand the Russian need to be secure on her western frontiers from all renewal of German aggression. We welcome her to her rightful place among the leading nations of the world ... It is my duty, however, to place before you certain facts about the present position in Europe.

From Stettin in the Baltic to Trieste in the Adriatic, an iron curtain has descended across the Continent. Behind the line lie all the capitals of the ancient states of central and eastern Europe − Warsaw, Berlin, Prague, Vienna, Budapest, Belgrade, Bucharest, and Sofia. All these famous cities and the populations around them lie in the Soviet sphere and all are subject in one form or another, not only to Soviet influence but to a very high and increasing measure of control from Moscow ... The Russian-dominated Polish government has been encouraged to make enormous and wrongful inroads upon Germany, and mass expulsion of millions of Germans on a scale grievous and undreamed of are now taking place. The Communist Parties, which were very small in all these eastern states of Europe, have been raised to per-eminence and power far beyond their numbers and are seeking everywhere to obtain totalitarian control. Police governments are prevailing in early every case ... Whatever conclusions may be drawn from these facts ... this is certainly not the liberated Europe we fought to build up. Nor is it one which contains the essentials of a permanent peace...

On the other hand I repulse the idea that a new war is inevitable; still more that is imminent ... I do not believe that Soviet Russia desires war. What they desire is the fruits of war and the indefinite expansion of their power and doctrines ... Our difficulties and dangers will not be removed by closing our eyes to them. They will not be removed by mere waiting to see what happens; nor will they be relieved by a policy of appeasement ... From what I have seen of our Russian friends and allies during the war, I am convinced that there is nothing they admire so much as strength and there is nothing for which they have less respect than for military weakness ... If the western democracies stand together in strict adherence to the principles of the United Nations Charter, their influence for furthering these principles will be immense ... If, however, they become divided or falter in their duty ... then indeed catastrophe may overwhelm us all."

—Winston S. Churchill, Address at Westminster College, Fulton, Missouri, 5th of March 1946

What was the basis for the 'Iron Curtain' speech?

Summary of What was the basis for the 'Iron Curtain' speech?

In his Iron Curtain speech, Winston Churchill was referring to the fact that by 1946, Soviet-dominated Communist governments were set up in Poland, Hungary, Romania, and Bulgaria. This was in spite of the hopes expressed at Yalta and there would be free and democratic elections in Eastern Europe after the war. Communist regimes not linked directly to Moscow had been established in Albania and Yugoslavia as well. Within two to three years this Soviet influence would be extended to East Germany and Czechoslovakia. His remarks were also prompted by the presence of the Red Army in those countries 'liberated' from Germany by the Russians − and by the cloak of secret which descended over Eastern Europe within a few months of the end of the war.

Soviet reaction to Churchill's Fulton speech

Summary of Soviet reaction to Churchill's Fulton speech

The response from the Soviet leadership was quick and one of outrage. Within a week Stalin had compared Churchill to Hitler. He saw the speech as both 'racist' and as 'a call to war with the Soviet Union.' Within three weeks the Soviets had taken major steps:

  • They withdrew from the IMF,
  • They stepped up the tone and intensity of any-western propaganda, and
  • They initiated a new five-year plan of self-strengthening.

Therefore, the 'Iron Curtain' speech led to a further hardening of opinions on both sides. Churchill had defined publicly the new front line what was now being seen as a new war.

Step Four: The Truman Doctrine

Summary of Step Four: The Truman Doctrine

Truman made a key speech to the U.S. Congress on the 12th of March 1947. In this speech he put forward the belief that the United States had the obligation to 'support free peoples who are resisting attempted subjugation by armed minorities or by outside pressures.' This became known as the 'Truman Doctrine.'

It was a radical change in U.S. foreign policy, a policy which had been traditionally isolationist. Truman's new 'doctrine' was in response to the instable situations in Turkey and, in particular, Greece. At the end of the war the British had restored the Greek monarchy, but Communist guerrillas continued to resist in the countryside. The British government could no longer offer assistance to the Greek government, and its own economy had been devastated by the war, leaving the British government £3000 million of debt. In February 1947, the British told the USA that they could no longer maintain troops in Greece. The United States did not want to risk a potential Communist takeover of a strategically important European country, so Truman issued his 'doctrine' and, in the name of preserving democracy over Communism, U.S. aid and military advisers were sent to Greece.

The Soviets saw this as evidence of the determination of the United States to expand its sphere of influence, and they did not recognise any legitimacy in this new American involvement in Europe. Truman's decision was affected not only by Churchill's perception of the expansionist threat, as outlined in his 'Iron Curtain' speech, but also by George Kennan's Long Telegram. As already mentioned, this 'doctrine' marked a departure from the United States' traditional policy of isolation, and it was the beginning of the American policy of 'containment of Communism. The philosophy of containment would, in the years to come, draw the USA into the affairs of nations well beyond Europe.

On the longer-term significance of the Truman Doctrine, political historian Walter LaFeber wrote:

"The Truman Doctrine was a milestone in American history ... the doctrine became an ideological shield behind which the United States marched to rebuild the Western political and economic system and encounter the radical left. From 1947 on, therefore, any threats to that Western system could be easily explained as Communist inspired, not as problems which arose from difficulties within the system itself. That was the most lasting and tragic result of the Truman Doctrine."
—Walter LaFeber, America, Russia, and the Cold War 5th ed (Knopf, 1985), pp.57−8

Step Five: The Marshall Plan

Summary of Step Five: The Marshall Plan

In January 1947, the U.S. Secretary of State, James Byrnes, resigned and was replaced by General George Marshall. Marshall believed that the economies of Western Europe needed immediate help from the USA. In a broadcast to the nation he declared, 'The Patient is sinking while the doctors deliberate.' The 'Marshall Plan' seemed to follow quite naturally on from the Truman Doctrine − it was the economic extension of the ideas outlined by the President.

"It is logical that the United States should do whatever it is able to do to assist in the return of normal economic health in the world, without which there can be no political stability and no assured peace. Our policy is not directed against any country or doctrine, but against hunger, poverty, desperation, and chaos. Its purpose should be the revival of a working economy in the world so as to permit the emergence of political and social conditions in which free institutions can exist ... Any government which is willing to assist in the task of recovery will find full co-operation ... on the part of the United States Government.

Before the United States Government can proceed much further in its efforts to alleviate the situation and help start the European world on its way to recovery, there must be some agreement among the countries of Europe as to the requirements of the situation and the part those countries themselves will take in order to give proper effect to whatever action might be undertaken by this Government. It would be neither fitting nor efficacious for this Government to undertake to draw up unilaterally a program designed to place Europe on its feet economically. This is the business of Europeans. The initiative, I think, must come from Europe."

—George C. Marshall, Address at Harvard University, the 5th of June 1947, Department of State Bulletin XXVII, 16th June 1947, pp. 1159−6

Dollar imperialism?

Summary of Dollar imperialism?

The Marshall Plan was designed to give immediate economic help to Europe. The problem of whether or not to 'allow' the Soviets to join the plan, or indeed to avoid specifically excluding them, was solved by setting down strict criteria to qualify for American economic aid. This involved allowing the United States to investigate the financial records of applicant countries. The USSR would never tolerate this condition.

Thus, the United States invited the USSR to join the Marshall Plan and claimed that this 'aid' was not directed for or against any country or doctrine. The stated aims of Marshall Plan aid were to:

  • Revive European working economies so that political and social stability could ensure, and
  • Safeguard the future of the U.S. economy.

However, to avoid the interpretation that the United States was in any way coercing European governments to accept that aid plan, it was made clear that 'the initiative must come from Europe.'

The bill allocating the four-year aid programme of $17 billion did not pass the U.S. Congress until March 1948. The eventual success of the bill was due mainly to the effect of the Czechoslovakia Coup of February 1948.

Soviet reaction to the Marshall Plan

Summary of Soviet reaction to the Marshall Plan

The Soviets rejected the Marshall Plan − as the USA probably intended them to − because the Americans asked to see recipients' financial records. The Soviets saw this as a prime example of American 'dollar imperialism.' In other words, the Soviets felt that the USA was establishing a European empire, and that its method was economic domination and dependence, which would ultimately give it political control.

Soviet Foreign Minister Vyshinsky gave the following speech at the United Nations in September 1947:

"The so-called Truman doctrine is a particular glaring example of the way in which the principles of the United Nations are violated, f the way in which the United Nations is ignored. The United States has moved towards giving up the idea of international co-operation and joint action by the great powers. It has tried to force its will on the other independent countries, whilst at the same time obviously using the money distributed as relief to needy continues as an instrument of political pressure.

This is clearly proved by the measures taken by the United States government with regard to Greece and Turkey, which ignore and bypass the United Nations. This policy conflicts sharply with the principle expressed by the General Assembly in its resolution of the 11th of December 1946, which declares that relief supplies to other countries should, at no time, be used as a political weapon.

The Marshall Plan is merely a variant of the Truman Doctrine. It is becoming more and more evident to everyone that the implementation of the Marshall Plan will mean placing European countries under the economic and political control of the United States and direct interference by the latter in those countries.

Moreover, this plan is an attempt to split Europe into two camps and, with the help of the United Kingdom and France, to complete the formation of a bloc of several European countries hostile to the interests of the democratic countries."

—Soviet Foreign Minister Vyshinsky

Previously the United States had attempted to unite the West with economic tactics; now they were on a path towards military unity. Historian Walter LaFeber pointed out the significance of the Marshall Plan:

"The plan's approach ... soon evolved into military alliances. Truman proved to be correct in saying that the Truman Doctrine and the Marshall Plan 'are two halves of the same walnut.' Americans willingly acquiesced as the military aspects of the doctrine developed into quite the larger part."
—Walter LaFeber

The Soviet response

Summary of The Soviet Response

In response to the Marshall Plan, the Soviets came up with the Molotov Plan, which was a series of bilateral trade agreements aimed to tie the economies of Eastern Europe to the USSR. The outcome was the creation of COMECON in January 1949. COMECON was the council for Mutual Economic Assistance. This was a centralised agency that linked the Eastern bloc countries to Moscow. It was designed to 'stimulate' and control their economic development, and support the collectivisation of agriculture and the development of heavy industry.

Cominform and the 'Two Camps' doctrine



Summary of Cominform

This was the Communist Information Bureau set up in September 1947. It was created as an instrument to increase Stalin's control over the Communist parties of other countries. It was initially comprised of Communists from the USSR, Yugoslavia, France, Italy, Poland, Bulgaria, Hungary, and Romania. The West was concerned that this organisation would actively spread Communism (and destabilise the democratic governments) in the West's own 'sphere of influence' − Western Europe.

Stalin's 'Two Camps' doctrine

Summary of Stalin's 'Two Camps' doctrine

Soviet leader Josef Stalin developed his idea of a Europe divided into two opposing camps in the 1920s and 1930s. Following World War Two, this idea, in the divisive context of post-war international elations, became a firm foundation for Soviet foreign policy. Indeed, in February 1946 (before Churchill's Iron Curtain speech) Stalin had delivered a speech emphasising the creation of 'two camps' opposing each other. At the inaugural meeting of Cominform in Warsaw, Soviet delegate Andrei Zhadanov delivered an important speech on Soviet foreign policy. He stated that the Americans had organised an 'anti-Soviet' bloc of countries that were economically dependent upon them − not only those in Western Europe, but also in South America and China. The 'second camp' was the USSR and the 'new democracies' in Eastern Europe. He also included countries he deemed 'associated' or 'sympathetic' to their cause − Indonesia, Vietnam, India, Egypt, and Syria. This Soviet doctrine was very similar to the 'new world order' outlined by Truman.

Step Six: Red Army occupation of Eastern Europe (1945−47)


Step Seven: The Czechoslovakian Coup (February 1948)


Step Eight: The Berlin Crisis (1948)