The two great powers glared at each other across the world, for although they had united to fight against the Nazis, in almost everything else they are completely different.
First of all, the United States believes that a country should be run on a Capitalist system - that is, all industry, business and agriculture should be owned by private people and firms. They believe that competition between rival factories or shops or farms will cause prices to fall and make the firms more efficient. If factory A is selling cars at £500, then factory B must sell theirs at the same price, or an even lower one, if they wish to remain in business. In order to make their cars for £500, factory B may have to scrap its old-fashioned machinery and install modern, more efficient equipment.
The Russians, on the other hand, believe in Socialism - that is, that everything should belong to the state and should be run by the government on behalf of the people. The Americans believe that any man who wishes to do so should be allowed to start a business and employ people to work for him. If he is hard-working enough, or skilful enough he may make a profit. If he pays his workmen £20 a week and makes £1000 a week profit for himself, he should, the Americans say, be allowed this as a reward for his intelligence and for the risk he is taking with his money.
The Russians believe that this system is wrong, and that no private person should be allowed to make a profit from the work of other citizens. If the labors of the ordinary people are to make a profit, then it should, they say, belong to the government, who will use it for the good of everyone in the country by building and running hospitals and schools, by paying for defense; communications and all the other needs of a country. So, all Russian factories and businesses (except for a few small one-man concerns) belong to the state, and their profits, instead of going into the pockets of one owner, or even a body of shareholders, go to the state.
America believes in the law of supply and demand. If, for example, too many firms are making washing machines, shops will have to keep reducing prices to try to sell them until they reach a level at which they are making a loss. As there is not enough profit in washing machines, factories will stop making them. If, on the other hand, there are only a few color television sets on the market, many people will want them. Firms will be able to push their prices higher and higher, as someone will be prepared to pay. The high prices for the sets will attract other firms to make them and as soon as more appear in the shops, the prices will start to fall.
Russia believes in a controlled economy. The government tries to work out how many cars or perambulators will be needed for that year, and sets the factory to make that number, which are sold at a controlled price. This, they say, avoids wasteful over-production, and under-production with its high prices.
If, in America, one trade or profession, or even one district, finds itself short of workers, then more must be attracted by higher wages or better conditions. In a similar situation in Russia workers might be ordered by the government to go to that particular job or area. The American, too, can earn as much as his trade union can force out of his employer: if necessary, he can go on strike until the wages are increased or his hours shortened. In Russia, the wages and hours are fixed by law and strikes are, in practice, impossible.
As a result of all this there are much greater differences in wealth in the United States than in the Soviet Union. In America there are powerful business men whose incomes are several million dollars a year (one estimate is that one person in every 600 is a millionaire), but there are also some desperately poor people almost on the starvation level. From their relatively high wages the Americans have to provide for many services such as hospitals and medical care, which the Russians are given by the state. In the Soviet Union there are no millionaires, but there are very few, by their standards, who are desperately poor. However, the standard of living in America is, on the average, much higher than in Russia. There is, for example, one motor vehicle for every two people in the U.S.A.: in the U.S.S.R. there are probably 50 people to every car.
In the matter of government, the two countries are completely different. America has two main political parties, the Republicans and the Democrats. Each has its own ideas on the way the country should be governed, and it is up to the people to decide at election time which one they want. The Russians have only one party, the Communists. They say that this is quite fair as the Communists know what is best for the vast majority of people. Any other party would be in the interest of only a minority of the population and must, therefore, not be allowed.
Document 2A: Yalta (Feb 1945)
Held during the war, on the surface, the Yalta conference seemed successful.The Allies agreed a Protocol of Proceedings to:
- divide Germany into four ‘zones’, which Britain, France, the USA and the USSR would occupy after the war.
- bring Nazi war-criminals to trial.
- set up a Polish Provisional Government of National Unity 'pledged to the holding of free and unfettered elections as soon as possible'.
- help the freed peoples of Europe set up democratic and self-governing countries by helping them to (a) maintain law and order; (b) carry out emergency relief measures; (c) set up governments; and (d) hold elections (this was called the 'Declaration of Liberated Europe').
- set up a commission to look into reparations.
At Yalta, the negotiations went very much in Stalin's favor, but this was because Roosevelt wanted Russian help in the Pacific, and was prepared to agree to almost anything as long as Stalin agreed to go to war with Japan. Therefore, Stalin promised that:
- Russia would join the war in the Pacific, in return for occupation zones in North Korea and Manchuria.
- Russia also agreed to join the United Nations.
Although the Conference appeared successful, however, behind the scenes, tension was growing, particularly about reparations, and about Poland.
After the conference, Churchill wrote to Roosevelt that ‘The Soviet Union has become a danger to the free world.’ And on their return home both he and Roosevelt were criticized for giving away too much to the Soviets:
Document 2B: Potsdam (July 1945)
At Potsdam, the Allies met after the surrender of Germany (in May 1945) to finalize the principles of the post-war peace – Potsdam was the Versailles of World War II. Three factors meant that the Potsdam Conference was not successful:
- Relations between the superpowers had worsened considerably since Yalta. In March 1945, Stalin had invited the non-Communist Polish leaders to meet him, and arrested them. Things had got so bad that, in May 1945, the British Joint Planing Group had drawn up plans for 'Operation Unthinkable' - a 'total war ... to impose our will upon Russia'.
- Meanwhile, Rooevelt had died, and America had a new president, Truman, who was inclined to ‘get tough’ with the Russians.
- Also, soon after he had arrived at the Conference, Truman learned (on 21 July) that America had tested the first atomic bomb. It gave the Americans a huge military advantage over everyone else. It also meant that Truman didn't need Stalin's help in Japan. Instead, Truman's main aim at the conference was to find out from Stalin what date the Russians intended to enter the war in the Pacific - something which (unlike Roosevelt) he did NOT want.So, at Potsdam, the arguments came out into the open.
The Conference agreed the following Protocols:
- to set up the four ‘zones of occupation’ in Germany. The Nazi Party, government and laws were to be destroyed, and 'German education shall be so controlled as completely to eliminate Nazi and militarist doctrines and to make possible the successful development of democratic ideas.
- to bring Nazi war-criminals to trial.
- to recognize the Polish Provisional Government of National Unity and hold 'free and unfettered elections as soon as possible'.
- Russia was allowed to take reparations from the Soviet Zone, and also 10% of the industrial equipment of the western zones as reparations. America and Britain could take reparations from their zones if they wished.
President Truman presented it as a 'compromise', but in fact the Allies had disagreed openly about:
- the details of how to divide Germany.
- the size of reparations Germany ought to pay.
- Russian influence over the countries of eastern Europe.
Churchill's Fulton Speech
One of the most controversial, remembered and formative speeches of the post-war years.
MP and historian Roy Jenkins, Why Churchill’s Speech was ‘A Shot Which Rang
around the World’ (2002).
In February 1946, Stalin gave a speech for the Russian elections (it is often called the 'Bolshoi' speech because he made it at the Bolshoi Theatre in Moscow). It contained the normal Communist attacks on capitalism, but included one sentence in which Stalin claimed: 'world capitalism proceeds through crisis and the catastrophes of war'. American politicians took it as a threat.
The Fulton Speech
On 5 March 1946, on the invitation of President Truman, Winston Churchill went to Fulton in America and gave a speech.
He said ‘a shadow’ had fallen on eastern Europe, which was now cut off from the free world by ‘ an iron curtain’.Behind that line, he said, the people of eastern Europe were ‘subject to Soviet influence . . . totalitarian control [and] police governments’.
Source A
“Mr Churchill has called for a war on the USSR.”
Stalin, writing in the Russian newspaper Pravda in March 1946.
Source B
“The Cold War set in. Churchill had given his famous speech in Fulton urging the imperialistic forces of the world to fight the Soviet Union. Our relations with England, France and the USA were ruined. “
Khrushchev, writing in 1971.In 1946 he had been a member of the Soviet government.