Until now, the history of the Cold War has been written as a series of diplomatic and military events: the Berlin airlift, the Korean War, the Cuban missile crisis, Vietnam, and countless covert and rhetorical maneuvers. When communism finally collapsed in 1989, it was suddenly obvious that economics had played a major role in the war. But what role exactly? Did the West succeed simply by the hidden hand of its markets? Or did Western powers offer direct and successful economic leadership? The answer is that our economic policy was key to the war, even more central and important than military might. Since World War II, in a world of democratic powers and peripheral combat, economic diplomacy has become the chief engine of global politics and prosperity. In a book that will take its place alongside the great diplomatic histories of the period, Diane Kunz offers a definitive history of 50 years of American economic diplomacy. From the Marshall Plan, to Bretton Woods, the Suez Crisis, the Alliance for Progress, the oil shocks, and beyond, America's international economic leadership has been controversial, at times misguided, difficult to sustain, yet ultimately triumphant. Though traditional wisdom insists that leaders must choose guns or butter that arms and prosperity are at odds Kunz argues the controversial thesis that America's economic and security policies worked hand-in-glove. With the great cause of containing communism as a driving force, presidents from Truman to Reagan built a nation both prosperous and strong while helping America's allies to achieve similar strengths. Diane Kunz's masterful narrative recounts the missing story at the heart of the American century.
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Kunz, an assistant professor of history at Yale, demonstrates that the long-term perceived threat posed by the Soviet Union legitimated government intervention in the U.S. domestic economy. Furthermore, she contends, that intervention provided both a good life for most Americans and the basis of national security, as the defense industry promoted long-term economic growth that nurtured decades of material prosperity and social stability. Economic diplomacy was the core of a foreign policy that linked participants in the Western economic order while binding them to a U.S. that was able and willing to assume the primary responsibilities of leadership because, for the first time in the country's experience, events abroad directly affected these shores. American economic dominance of the Western sphere, Kunz explains, depended on a non-zero-sum approach facilitating development without creating an overt client system. On the other hand, command economies on the Leninist model proved spectacularly unable to provide both butter and guns-a failure that sentenced them to oblivion. Meanwhile, far from creating "imperial overstretch" along the lines described by Paul Kennedy, the national security state created by the Cold War, Kunz says, provided prosperity at home and peace abroad. She argues provocatively that the subsequent decoupling of foreign and domestic policy is combining with free-market triumphalism to weaken the synergies that generated affluence and security. One need not accept her argument to appreciate this as a clear and well-researched analysis of a revolutionary period in U.S. history.
Copyright 1996 Reed Business Information, Inc.
Kunz sanguinely surveys critical links between the cold war, economic diplomacy, and postwar prosperity in the United States over the past half century. "Ike was wrong," she declares, when he proclaimed the emerging military-industrial complex a threat to democracy. To the contrary, she urges, not only are guns and butter "not mutually exclusive," but the national security state "provided the perfect basis for American domestic prosperity and the raison d'etre for a Western alliance that functioned in both the security and economic spheres." Kunz traces the development of the Bretton Woods economic system, the Marshall Plan, and NATO; she then examines the interactions of security, domestic economic, and foreign economic issues in U.S. policy in each decade since World War II. Kunz argues we "now face a vacuum" and must "confront issues [Americans] have always dodged," such as the proper role of government in the economy and the proper role of the U.S. in the world. A tempting analysis of an aspect of history most of us ignore. Mary Carroll
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