Laying the Foundations 1945-50
excerpted from the book
Confronting the Third World
United States Foreign Policy 1945-1980
by Gabriel Kolko
Pantheon Books,1988
The Wartime Image of the Future
p12
More than any other branch of the government, the State Department
under Cordell Hull, who was its secretary from 1933 to 1944, defined
the U.S. vision of the ideal relationship of the colonized and
poorer nations to the world order. Hull was a disciple of Wilson
and his "Open Door" concept of an integrated world based
on free trade that Wilson took from the Democratic Party's traditional
policies and raised to a higher level of abstraction. Hull was,
as well, both an ideologue and a pragmatist, ready to confront
aggressively America's allies, particularly Britain, but also
not to press issues too far with them if something tangible could
be gained in return. He regarded the breakup of the world economy
into isolated trading blocs after the 1929-31 Depression as the
single most important cause of the Second World War as well as
the most likely source of future wars. Restrictive trade cartels,
which had especially inflated the price of the United States'
increasingly essential raw materials imports, were integral to
this distorted world economy, and it was the British sterling
bloc and empire that most epitomized these challenges to an open
world economy based on free trade. From 1941 onward the United
States never tired of stressing that "raw material supplies
must be available to all nations without discrimination"
after the war, and this in turn required complete access for U.S.
capital to enter any nation to accelerate "the sound development
of latent natural resources and productive capacity in relatively
undeveloped areas."' But while there was a consensus on these
essentially anticolonial objectives among key American decisionmakers
during the war, they disagreed how and with what speed to apply
them, especially because Britain, more than any other nation,
was the object of the U.S. program, and the British after 1943
made no secret of their fears that America was trying to advance
its interests in Asia and the Middle East at their expense.
But it was not only Washington's desire
to keep Britain as an ally in Europe after the war that inhibited
its pressing its anticolonial sentiments too far and too fast.
The radical nature of many of the local political forces aspiring
to replace the colonial powers especially disturbed American leaders,
and particularly after 1945 they increasingly feared local Left
parties that might presumably be friendlier to the Soviet Union
or even aligned with it. But even in India, the United States
supported British policy in repressing a thoroughly anti-Communist
Mahatma Gandhi and the Congress Party because Gandhi was opposed
to the war and because the British successfully demanded that
the Americans respect their jurisdiction over India. In the Middle
East, at least during the war, Washington retreated when Britain
objected to its issuing a declaration favoring steps toward independence
for Syria and Lebanon. The implicit recognition of British spheres
of influence in the colonial world was extended to Africa also,
where the United States kept silent on the future of mandated
areas even though it insisted that it retained a residual right
under the 1919 Treaty of Versailles to have its trade interests
there protected.
The United States did not pursue its nominal
anticolonial ideology too ardently also because it expected the
British to support American claims for the transfer of Japanese-held
Pacific trusteeships to the United States after the war. Indeed,
as the Cold War intensified after 1945, keeping Britain firmly
on the United States' side quickly submerged any latent doubts
Washington felt about the continuation of its imperial power in
various forms. Both the U.S. Navy and the War Department wished
to establish permanent bases on the formerly Japanese-controlled
islands. The State Department, too, sought bases, but with UN
sanction and theoretically under UN control. Simply to annex the
islands, as the military urged, would allow the British to claim
the same right elsewhere, particularly in the Middle East, and
endanger, as Secretary of the Interior Harold Ickes put it, "our
great stake in Middle Eastern oil."
p14
Whatever its political form, Washington unswervingly advocated
an integrated world economy open to American interests. Independence,
when and where it came, would be for states capable of playing
a role in an integrated world order congenial to U.S. designs,
a paternalist attitude that further subordinated anticolonialism
to American needs. Self-determination as an absolute principle
had no vocal spokesmen in Washington.
Precisely because the United States entered
the postwar era with its earlier experiences and obsessions profoundly
coloring its perceptions of the future, there was a continuity
between its policies after 1945 and its earlier problems. Indeed,
while its fear of the Left increased dramatically after 1944,
culminating in its Cold War fixations, the United States prewar
definitions of its goals and needs remained, so that it was not
at all surprising that they later deeply influence its policies
and action in various nations where the Left was either weak or
nonexistent. And because it believed profoundly in the efficacy
of its institutional proposals for an integrated postwar world
economic and political structure, it assumed that the implementation
of this program would prevent the growth of the radical Left everywhere
in the world, the Third World included. If one looks at the plans
for the World Bank or International Trade Organization (ITO) formulated
and made public during 1945, one is immediately struck by the
fact that they subordinated the problems of the Third World to
the reconstruction of a world economy in which the United States
and Western Europe are the principal partners, while the needs
and problems of Asia, Latin America, and Africa were incidental
and, implicitly, to be dealt with as a by-product of solving difficulties
elsewhere.
For the United States, given its official
belief in the allegedly complementary nature of national economies
that are open to each other and trade freely, this indifference
to developments in the poorest regions was logical. The United
States was not, in reality, concerned chiefly with either the
economic or political problems there.
Confronting Turbulent Asia
p25
As America's only true colony in the twentieth century, the Philippines
is the single best example of its impact on the political and
economic life of any nation because only there could it freely
impose its desires. And it is the one case ... to translate the
ambiguities of American ideology and proclamations into realities
that reveal best the complex interactions among local social forces
and economic changes, U.S. interests, and the needs of the Filipino
people.
It was in the Philippines, too, that America's
colonial domination produced an economic and political structural
legacy that was profoundly to define all of the important issues
of Filipino life after 1945. The United States built upon the
landed oligarchies it found in place after its conquest of the
islands in 1899-1901. Regional politics, with its largely family-based
local alliances, became the hallmark of the American-imposed political
structure after 1907 as United States-style boss politics and
patronage merged naturally with the existing social order, co-opting
some new members into the local ruling class but leaving its basic
institutional role unchanged. In most of the fifty-one provinces,
many isolated by the sea and languages, oligarchies with economic
and political power entrenched themselves permanently so that
the only significant political party, the Nacionalistas, constituted
little more than ever-shifting coalitions of regional political
machines with scarcely any commitments save to their own immediate
economic needs and the control of power. Patron-client relations
mitigated some of the exploitive edges of such a system for the
masses, as family and patronage ties or outright vote-buying provided
for a few of the urgent economic needs of the politically loyal
poor m a highly stratified social and economic structure; but
while residues of this system persist even today, it began to
break down in a number of strategic provinces during the 1930s.
The main factor eroding the paternalistic,
oligarchical political order the United States chose to call democracy
in the Philippines was the commercial transformation of the overwhelmingly
dominant agricultural economy on which the oligarchy's power was
largely based and that employed the vast majority of the nation.
From 1909 onward the United States imposed reciprocal free trade
on the Philippines and greatly stimulated the production of export-oriented
commodities geared to the highly profitable American markets.
To satisfy the demand for sugar, coconut products, and the like,
capital investments transformed labor and land utilization in
ways that made the new rural social conditions far more exploitive
and eliminated many small farmers. In central Luzon, in particular,
growing population pressures also produced land shortages, and
the collapse of the U.S. market for Philippine commodities during
the 1930s began to radicalize large sectors of the poor peasantry
as purely commercial considerations replaced the agricultural
system's paternalism. Usury, excessive dependence on cash crops
with unstable prices rather than production for family consumption-all
the typical forces that sharply reduce living standards and transform
peasants from being acquiescent beasts of burden into angry activists-were
already in motion before the Second World War.
These structural changes created increased
mass pressures for social and economic reforms in the years prior
to World War Two, when "with few exceptions," to quote
a CIA report, the normally highly opportunistic economic and political
elite chose to protect its interests by collaborating as loyally
with the Japanese as they had with the Americans, thereby delegitimizing
itself both in the eyes of the people with social grievances as
well potentially, as those of their colonial masters.' The most
important puppet the consummately ambitious Manuel A. Roxas, had
been the chief prewar rival of President Manuel Quezon and Vice
President Sergio Osmeha, both of whom went into exile. But a large
majority of the Japanese-controlled National Assembly were former
senior political figures, and Quezon's prewar cabinet simply continued
to work for the new occupiers. While some collaborators also tried
to hedge their interests by maintaining discreet contacts with
the guerrillas who formed throughout the country under both U.S.
and Communist leadership, most played their new roles loyally,
made fortunes and survived as comfortably as possible the exceptional
ravages the war and occupation imposed on the nation.
The question of how to treat these collaborators
was, in essence, one that touched fundamentally the future of
the traditional ruling class, the nature of those who might replace
them, as well as the Philippines' postwar role as a bastion of
American power in East Asia. General Douglas MacArthur, commander
of the campaign to recapture the Philippines, had lived there
for decades and knew the elite well. While he preferred initially
to rely upon those who had worked with the guerrilla groups directly
under U.S. control, they were too inexperienced and small in number,
and he was determined above all to keep the Hukbalahap guerrillas,
comprised of radicalized poor peasants concentrated in central
Luzon and with important though not exclusive Communist leadership,
out of power. Whatever official Washington's position for removing
collaborators from authority, MacArthur ignored it when he disagreed
with it, and he was allowed to define and implement the policy.
As American forces began to retum to the islands after October
1944, they fired most collaborators, and eventually fifty-five
hundred were charged, though wealthier ones were freed on bail,
and their trials were to be the responsibility of the Philippines
government, whose independence was then being negotiated. Meanwhile,
at the beginning of 1945, the Americans used their local allies
to attempt to disarm the Huks, and in February arrested their
leaders.
On April 18, 1945, it was announced that
a "liberated" Roxas had been released from prison while
his colleagues remained behind bars. Restored to his prewar brigadier
generalship in the United States-controlled army, the close friend
of MacArthur now had his highly dubious wartime secret contacts
with Americans used as an excuse to impose a United States-approved
political solution on the dangerously fragmented and unstable
struggle for power and legitimacy in the Philippines then taking
place. Roxas won American approval because in 1945 he confided
to key U.S. officials that he was not for the basic principle
of independence. As Paul V. McNutt, who had been U.S. high commissioner
during 1937-39 and who was reappointed in 1945 reported, "Roxas
has indicated by word and deed his desire to follow American pattern
of government and retain closest ties with us in all matters.
,, ,"2 Signs of America's benediction quickly won the ever-accommodating
Roxas the support of ambitious politicians and members of the
economic elite who regarded him as a winner, and soon he was restored
to his position as president of the Senate. In April 1946 he was
elected the first postwar president and, parenthetically, two
years later was to grant amnesty to all accused collaborators.
It was in this political context, so completely under U.S. control,
that the United States negotiated the ostensible legal independence
of the Philippines to which it had committed itself a decade earlier.
These negotiations had to take into account the economic interests
that had been built up by both sides during the entire colonial
period. On one
p29
With the Philippines nominally an independent state but in fact
still economically and politically a U.S. colony, the Roxas coalition
of opportunistic politicians and factions interested in the boodle
essential to their machines' cohesion proceeded to reimpose the
same exploitive politics that had marred the nation's political
life consistently until then. The coalition was completely devoid
of nationalist impulses or broader social goals in a war-torn
nation plagued with vast human misery and now sinking more deeply
into the vortex of civil war. Roxas' first years were characterized
by the return to traditional vote-rigging and buying, which began
with the Senate election of November 1947, and corruption in the
allocation of all-too-scarce government funds. The Huks and its
peasants' union were outlawed in March 1948. By the time Roxas
died suddenly on April 15, 1948, the exclusion of the Left from
the political process and the absence of any reforms to deal with
massive poverty guaranteed the spread of civil conflict, and as
many as ten thousand people took up arms with the Huks.
The new president, Elpidio Quirino, proved
no better than Roxas, and his successful reelection effort in
1949 was the most fraudulent and expensive in the Philippines
until then. While senior American officials in early 1948 had
hoped that the Philippines would continue as a primary base in
the region and take care of its own internal affairs, by 1949
the economic consequences of the existing political leadership
as well as the terms of the Bell Act, which in order to tie up
bilateral trade had also pegged the peso to the dollar and made
them freely convertible at a rate the Filipinos could not alter,
had produced economic chaos that threatened also to undermine
U.S. security interests. With fully four-fifths of its imports
coming from the United States and nearly that proportion of its
exports directed to it, the Philippines was still as much of an
economic colony as it had been before independence. Rampant inflation
and rising unemployment, the excessive importation of U.S. goods,
and then massive capital flight were too much to bear, and at
the end of 1949 the United States was forced to concede Manila
the right to impose exchange controls. "The center of this
[Far Eastern] circle is the Philippines," an exasperated
Dean Acheson told a closed meeting of senators in February 1950.
"The Philippines are our particular interest and ward. We
brought them up," but their behavior was still "childlike,"
their economic problems "very severe," the risks coming
less from the Huks, which "I do not think started out"
as Communists, than from "disintegration." With the
men it selected implementing the policies it imposed, the United
States' most ambitious venture in the Far East after 1945 and
showcase for its ability to transfer the American way of life
to a new nation was heading toward disaster.
Latin America: The Nationalist Challenge
p35
The United States' main problems in Latin America from the end
of World ~ War Two until 1960 differed dramatically from those
in the other major Third World regions, for they involved not
the alleged menace of Russia and communism but rather the emergence
of conservative forms of nationalism-a challenge that has persisted
in various guises since then. Precisely because this movement
grew out of specific Latin American conditions and was unrelated
to the United States' far greater preoccupations with communism,
the Left, and the legacies of the demise of European power elsewhere,
Washington preferred virtually to ignore its hemisphere during
this period as much as possible.
What the United States confronted in Latin
America was an alternative concept of national capitalist economic
development that rejected fundamentally its historic objective
of an integrated world economy based not simply on capitalism
but also on unrestricted U.S. access to whatever wealth it desired-hegemony
rather than cooperation. Nowhere else were the underlying bases
and objectives of U.S. foreign policy revealed so starkly, without
the obfuscating intercession of the problems of either communism
or socialism. Rather than some amorphous concept of an Open Door
accessible to all capitalist nations, power and gain for the United
States in economic terms from the inception was the foundation
of both its policies and its actions in the Western Hemisphere.
Of a number of Washington's efforts to
reverse the trend toward nationalism, those involving oil were
the most important. It was official policy that it would always
"encourage and facilitate" U.S. firms' involvement in
oil development "not merely because of the readier access
which such participation would guarantee to us but also because
. . . the technical and managerial skill of the American petroleum
industry is preeminently competent to insure the prompt and efficient
development of resources anywhere." Whatever the sovereign
right of a state to nationalize, it was formally opposed to it
in oil as being confiscatory in practice. In Mexico, where the
government had nationalized U.S. firms in 1937, Washington persisted
relentlessly in attempting to get American producers back into
the country, systematically preventing loans or spare parts from
reaching the state oil company. And in Brazil it actively opposed
the creation of a national oil company.
But it was in Venezuela, whose oil output
far exceeded that of the entire continent, that Washington's efforts
to protect its oil firms brought to the fore the larger issue
of the possible role of the region's military in attaining U.S.
objectives and protecting its interests. The Accion Democratica
party of moderate liberals had taken power there in late 1945
with the cooperation of junior officers, and it overwhelmingly
won the fair December 1947 elections. While thoroughly anti-Communist,
it also had a reform program that threatened the U.S.-owned oil
companies, the traditional oligarchy, and the army. In November
1948 a junta, with oil companies' support, overthrew the government,
and U.S. producers continued to profit handsomely under a dictatorship
that was to last ten years. Despite the fact that the State Department
had in December expressed concern about military coups against
democratically elected regimes, the following month it recognized
the new junta.
The relationship of the United States
to the Latin American military in this period was made more complex
by the fact that in many nations the military was frequently a
crucial supporter of nationalist economic strategies, as in Brazil
and Argentina. In such cases nationalism and the absence of basic
democratic rights frequently were synonymous. The United States
issued declarations against oppressive regimes in the hemisphere
and even opposed an Argentine suggestion in August 1947 to make
anti-Communist agreements for fear they would be used as a justification
by quasi-fascist governments not only to squelch internal dissent
and retain power but also to pursue their economic programs. With
officers found in both the pro- and anti-U.S. camps, it was inevitable
that U.S. policies appear tortured as Washington began to explore
after 1946 the possibility of gaining the maximum possible from
the Latin American military's growing role as a political mediator
as well as its potential for becoming the dominant force throughout
the hemisphere.
The issue of relating to the Latin American
officers corps could not be delayed indefinitely because the military's
importance led many of these nations also to seek to modernize
their armies' equipment, and in the period after 1945 the United
States was the only possible source. The War Department in 1946
favored allowing such purchases, while the State Department thought
most Latin American nations could not afford them. But the War
Department argued that if the United States did not supply the
arms these states would eventually turn to Europe, which would
then send military training missions and would only further undermine
existing U.S. influence. Keeping these armies standardized to
its equipment and advisers was justified also because it would
neutralize a transmission belt for European ideas- ideas that
had in the past included, among other things, fascism. More to
the point, as a War Department representative explained to a secret
hearing of Congress, "In those cases where the army or the
navy does not actually run the government, they come so close
to it that any influence on them has great national importance
to those countries. Our military missions there are working with
the most influential people in those governments." And at
the very least they were good anti-Communists. Immediately after
the so-called Greek-Turkey crisis of March 1947, Acheson reversed
the State Department's opposition, and the strategy of integrating
and wooing the Latin American military was initiated. While the
State Department developed disingenuous justifications for its
convoluted recognition policy and de facto support for military
dictators, real or incipient, Washington's most senior leaders
assiduously avoided thinking about the problems of the region
and the paradoxes of their assorted policies. , -
Latin America was closest to the United
States and of far greater economic importance than any other Third
World region, but senior U.S. officials increasingly dismissed
it as an aberrant, benighted area inhabited by helpless, essentially
childish peoples. When George Kennan was sent to review what he
described as the "unhappy and hopeless" background there,
he penned the most acerbic dispatch of his entire career. Not
even the Communists seemed viable "because their Latin American
character inclines them to individualism [and] to undiscipline,"
and he was certain that Moscow regarded them, as he himself did
all Latin Americans, "with a mixture of amusement, contempt,
and anxiety." In the end, he advised, where popular governments
could not cope with the Communists, "then we must concede
that harsh governmental measures of repression may be the only
answer" from authoritarian regimes, and the United States
would have "to be satisfied if the results are on balance
favorable to our purposes." While Kennan's brutal analysis
caused the department to bury his report, his successor as head
of State Department policy planning, Louis Halle, at the same
time published an anonymous essay in Foreign Affairs arguing for
an attitude of noblesse oblige. Pursuing the motif of the "childish"
nature of the area, he condescendingly argued that if the United
States treated the Latin Americans like adults, then perhaps they
would learn to behave like them.
Whether Washington's increasingly petulant
mood toward Latin America would be translated into policy remained
to be seen, depending as it did on what other issues it had to
consider elsewhere in the world. Implied in it, however, was that
the hegemony the United States exercised over the economic domain
would also have to apply to politics in order to protect the most
critical aspect of the U.S. relationship to the hemisphere. In
brief, during the first postwar years Washington opposed the main
thrust of hemispheric political life toward nationalism, which
as yet possessed only a minor leftist, much less Communist, dimension.
The fact that large sectors of both the Center and Right especially
disturbed the United States and challenged its interests revealed
most about its hegemonic objectives in the Third World where neither
geopolitical considerations nor nominal European allies constrained
it.
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