12.1 — 1945: A New Order

At the end of the Second World War, the United States produced roughly half of the world's manufactured goods, held about two-thirds of its gold reserves, had the only atomic weapons, and had suffered almost no damage to its territory.

The Soviet Union had lost around 27 million people and had its western regions destroyed, and had the largest army in the world sitting in the middle of Europe.

Britain and France were victorious, bankrupt and about to lose their empires. Germany and Japan were occupied and in ruins.

That distribution of power is what produced everything in this Part.

What was built

The institutions of 1944–48 were designed by people with the previous thirty years explicitly in mind (Chapter 11.12), and each one was a fix for a named failure.

The United Nations, 1945. The League had failed because the great powers were not in it or had left (Chapter 11.4). So the UN gave the five principal victors permanent Security Council seats with a veto.

The veto is criticised constantly and it is the reason the organisation exists. A body that can pass binding resolutions against a great power would simply be ignored, or would drive that power out. The design accepts paralysis on great-power disputes in exchange for keeping everyone inside. Chapter 13.7 assesses the record.

The Bretton Woods institutions (Chapter 9.10), against the currency and trade wars of the 1930s.

The Universal Declaration of Human Rights, 1948, the Genocide Convention, and the Geneva Conventions of 1949.

And the Marshall Plan, 1948–52 — around 13 billion dollars of American aid to western Europe, roughly 5 percent of American GDP at the time.

Its reasoning was explicitly the opposite of 1919. Rather than extracting reparations from the defeated, rebuild them, on the argument that a prosperous Europe would not produce another Hitler and would be a market for American goods. The offer was made to the Soviet Union and eastern Europe and was refused by Stalin, which is one of the moments that hardened the division.

And the occupations of Germany and Japan followed the same logic — denazification and demilitarisation, then reconstruction and integration rather than punishment. Both became prosperous democracies and allies within fifteen years, which is the strongest evidence in this volume that a lesson was learned.

How the division happened

The wartime alliance dissolved within about two years, and the argument about who caused it is one of the oldest in Cold War history.

The traditional Western account. Stalin broke his commitments. At Yalta in February 1945 he agreed to free elections in liberated Europe; what followed in Poland, Hungary, Romania, Bulgaria and Czechoslovakia was the progressive installation of communist governments through a combination of Soviet military presence, control of the interior ministries, and the elimination of rivals.

The revisionist account. The United States used its atomic monopoly and economic power to press advantage, and Soviet actions in eastern Europe were a defensive response by a country that had been invaded from the west twice in thirty years and that had lost 27 million people.

The post-revisionist synthesis, which is the current mainstream. Both sides acted on genuine security fears, in a situation with no established rules, and each read the other's defensive measures as aggressive.

And the geography matters more than the ideology. The Red Army was in eastern Europe because it had fought its way there. No arrangement short of war was going to remove it. Churchill's percentages agreement with Stalin in 1944 — dividing influence in the Balkans in pencil on a scrap of paper — is evidence that the Western leaders understood this at the time.

The key events, in order. Churchill's Iron Curtain speech in March 1946. The Truman Doctrine in March 1947, committing the United States to support free peoples resisting subjugation. The Marshall Plan, refused by the east. The communist coup in Czechoslovakia in February 1948, which removed the last mixed government in the Soviet sphere and which had a large effect on Western opinion.

And the Berlin blockade, June 1948 to May 1949. The Soviets cut land access to West Berlin, which lay 160 kilometres inside their zone. The Western response was to supply the city by air — at peak, an aircraft landing every few minutes, delivering food and coal for over two million people for eleven months. The blockade was lifted.

It produced NATO in April 1949 and, in the same year, the division of Germany into two states. The Warsaw Pact followed in 1955.

The structure of the Cold War

Four features that define it.

Bipolarity. Two superpowers with no third comparable power, so almost every regional conflict was drawn into the framework.

Ideological universalism. Both sides claimed their system was the correct one for all humanity, which meant every country's internal arrangements were the other side's business.

Nuclear stalemate (Chapter 11.10). Direct war between the principals was unthinkable, which pushed the conflict into proxies, subversion, coups, aid and propaganda.

And it was global. Chapter 12.4 covers what that meant for the countries where it was actually fought.

The third position

Not everyone chose a side, and this is where India's role belongs.

The Non-Aligned Movement grew from the Bandung Conference of 1955 — twenty-nine Asian and African states, many newly independent — and was formally founded at Belgrade in 1961 by Nehru, Nasser of Egypt, Tito of Yugoslavia, Sukarno of Indonesia and Nkrumah of Ghana.

Its position. Newly independent states should not exchange colonial rule for bloc membership. They should take aid and technology from both sides, refuse military alliances, and press for decolonization and disarmament.

Assessed honestly. It gave newly independent countries a collective voice and it kept several of them out of the worst of the proxy conflicts. India obtained Soviet steel plants and American food aid, which was the strategy working.

And it was frequently not non-aligned in practice. India signed a treaty with the Soviet Union in 1971 (Chapter 6.26); Cuba was a member and a Soviet client; and the movement was inconsistent in criticising the two blocs. After 1991 it lost its central purpose and continues as a diplomatic grouping with limited weight.

The Chinese complication

The assumption of a single communist bloc was wrong within a decade and it took Western analysts years to see it.

The Sino-Soviet split developed from the late 1950s over ideology, over Soviet unwillingness to support Chinese nuclear ambitions, over border disputes, and over Mao's view that Khrushchev's denunciation of Stalin and pursuit of coexistence with the West were betrayals.

By 1969 Chinese and Soviet forces were fighting on the Ussuri River.

And that split is what made Nixon's opening to China in 1972 possible, which realigned the entire structure: two communist powers hostile to each other, with the United States able to deal with each.

The lesson is worth extracting: ideology predicted less about state behaviour than geography and interest did, which is a finding that recurs throughout this Part.

What the order looked like from outside

A necessary corrective, because the standard account is written from Washington and Moscow.

For most of the world's population, the period after 1945 was defined by decolonization (Chapter 10.9), by development, and by the Cold War arriving as an external force that funded whichever local faction would align.

The superpowers supported dictatorships wherever it suited them. The United States backed or installed governments in Iran in 1953, Guatemala in 1954, Congo in 1960–61, Chile in 1973, Indonesia in 1965, and supported military regimes across Latin America. The Soviet Union installed and sustained governments across eastern Europe by force, invaded Hungary in 1956 and Czechoslovakia in 1968, and backed regimes in Africa and Asia regardless of their conduct.

And the conflicts were fought in the third world. Chapter 12.4 does the count.

Where this shows up in your life

The UN, the IMF, the World Bank, the WHO, NATO and the EU all date from this settlement, and the arguments about reforming them — particularly Security Council membership, which reflects 1945 and not the present, and which India has sought for decades — are arguments about a design that is eighty years old.

And the largest thing to notice is the counterfactual that did not happen. In 1945 the expectation was widespread that another great-power war was likely within a generation. There has not been one.

Whether that is due to nuclear deterrence, to the institutions, to economic interdependence, or to luck is genuinely argued, and the most useful position is that it is probably all four and that none of them is guaranteed to hold. Chapter 16.5 returns to it.

What the next page covers

Chapter 12.2 covers how the Cold War actually worked as a system — what deterrence is and what it requires, the crises and how close each came to nuclear war, the arms race and the arms control that eventually constrained it, espionage and its actual value, and the specific occasions on which the world was saved by an individual's judgement.