Following the end of WWII, Europe experienced the negative changes associated with the end of the large-scale war. Infrastructure was destroyed by German bombing campaigns, while food shortages plagued Great Britain and France. Europe had an overwhelming amount of debt it owed to the United States as part of the lend-lease program. The recovery of Europe was seen as a responsibility of the Allies after their victory over the Germans. Let's take a closer look at Post War Europe!
Post-War Europe: Definition
The Post War period in European history is considered to be from 1945-1991, following the end of WWII. WWII left Europe in a dismal financial state without the resources necessary to maintain a modern society. The situation in Post War Europe required a global response and international cooperation if it were to be addressed successfully.
Post-War Europe: Map
Toward World War II, the Allied forces realized they had to answer the question, "What to do with Germany?". In February 1945, at the Yalta Conference, Joseph Stalin represented the Soviet Union, Franklin Delano Roosevelt in America, and Winston Churchill in Great Britain. It was decided that Germany had to surrender unconditionally and pay reparations. The Soviet Union, USSR, would gain control over Poland and allow it to have free elections. The USSR would also join America in the war against Japan.
Reparations:
A payment was made from party A to party B because of damage done by party A
The Potsdam Conference was held after the war from July to August in 1945. Stalin was the only original member of the previous trio to attend. Roosevelt died and was replaced by Harry Truman. Churchill lost the election and was replaced with Clement Attlee. This shift in attendance caused a change in the negotiations concerning Germany.
The three decided that Germany would be split into four sections, each dominated by a different allied nation's military. France, Great Britain, the Soviet Union, and America each had their section of the country. Berlin, Germany's capital, was also split into four sectors, even with the Soviet Union's German section.
Fig 1: Allied Occupation of Germany After World War II
France, America, and Great Britain combined their German territories to create the German Federal Republic, while the Soviet Union created the German Democratic Republic from its portion. The two sections of Germany were governed very differently. The Soviet Union wasn't permitted to take reparations from Germany as it had in World War I. Instead, the USSR was allowed to take industrial equipment from its portion of Germany.
Other nations gained and lost land due to the Yalta Conference. Poland was the only country on the winning side to lose land. The Soviet Union claimed a portion of Poland, while it was given some of Germany.
Fig 2: Post-World War II Map of Europe
Post-War Reconstruction in Europe
Reconstruction in Post-War Europe addressed the economic and humanitarian crises caused by WWII. World War II claimed the lives of over thirty million people through battles, starvation, disease, and genocide.1 While it is difficult to ascertain the effect of bombing on industrial facilities throughout the war, some industrial factories made it through the war almost unscathed; however, transportation infrastructure was destroyed. The factories needed minor repairs, but there wasn't a way to export goods. Furthermore, countries didn't want to work with Germany because of the animosity from the war.
Post-War Europe: Economy
If Europe wanted to renew reproduction, it needed to purchase supplies. European countries couldn't afford supplies and welfare programs. Western Europe was in a position where, unless there was an outside intervention, much of the population would starve.
American Loans to Great Britain (Part 1)
During WWII, the United States provided over $40 billion in lend-lease non-repayable loans to Britain. When the war ended, so did the lend-lease program; Britain would have to borrow money from the United States on standard terms to maintain its sparse existence. The loan was issued on the clause that sterling would be freely convertible to American dollars at $4.03 per pound. This $3.75 billion loan from the United States caused a run on British currency, which led to the British losing 1/3 of the credit lent to price hikes.
The Marshall Plan
“Our policy is not directed against any country, but against hunger, poverty, desperation and chaos.” 3
-George C Marshal
The Economic Cooperation Act, most commonly known as the Marshall Plan, was created by George C. Marshall and passed in 1948. It was a four-year program granting European countries thirteen billion dollars for reconstruction. This allowed countries to purchase supplies (mainly from America) and renew production without cutting welfare.
The Marshall Act came with strings attached. Countries that accepted it had to "decontrol prices, stabilize exchange rates, and balance their budgets." 3 The Plan also included ways to reduce inflation. These requirements set up the framework for a market economy. The Soviet Union was offered the same deal as other nations but refused. They had a command economy and refused to make the switch.
Poland and Czechoslovakia wanted to accept the Marshall Plan, but Stalin prohibited it.
Fig 3: Logo used for Marshall Plan in European countries.
The terms offered by the Marshall Plan limited the power of socialist parties because it favored market economies. This pushed countries further from the Soviet Union and toward America. The countries were bound together through their economies. To go to war with one another would hurt their economy; thus, the Marshall Plan was also preventative legislation.
West Germany was locked into an economic alliance with the countries that accepted the Marshall Plan. France was one of the countries that were against this. It had a limit on the amount that Germany could produce and had a form of reparation payment. France wasn't allowed to take the Marshall Plan until it lifted its German regulations and ended the reparations. France gave in and met the terms of the plan.
American Loans to Great Britain (Part 2)
After the Marshall Plan was enacted, the countries receiving the aid achieved a 15-25% increase in their gross national product. The economic success shortened the gap between the British pound and the American dollar and enabled self-sufficiency by the end of the Marshall Plan in 1951.
Social Changes in Europe After WWII
World War II cost many people their lives. Countries that didn't accept the Marshall Plan had a slower recovery rate. Hungary, Romania, and Yugoslavia suffered from population stagnation. This means that their population didn't rise or fall. Usually, a country wants a stable population rise, but Hungary, Romania, and Yugoslavia didn't experience a rise until 1950. Russia, Czechoslovakia, and Poland experienced a decline in the population of ten to twenty percent.
After the Potsdam Conference, fifteen million Germans were forced to relocate when German territory was given to different countries. Two million of these people either died in the process or went missing. Around six million Jewish people were murdered during the Holocaust, and many others were forced to relocate. Then there were soldiers who were physically disabled in the war or incapable of returning to everyday life due to mental trauma.
Fig 4: Children outside a destroyed building after Germans bombed London
These population shifts caused Europe to lose many able-bodied young men who would have made up the workforce. Women joined the workforce when the men left for war. While many left once the men returned, others had to remain. Some wanted to, while others had to support their families.
After WWII, Europe underwent a series of changes in social class accompanied by government-backed initiatives meant to grow the Middle Class and increase financial stability. Post-War Europe was the catalyst that sparked the creation of global programs such as the UN and, notably, the National Health Service in 1948 in the UK.
Due to the Potsdam Conference and the Marshall Plan, the relationship between the Soviet Union and the United States continued to disintegrate. Post-War Europe illuminated the differences between the Soviet Union and the United States. These dividers would continue to grow and flourish, eventually becoming the Cold War.
Post-War Europe - Key takeaways
- Post War Europe spanned from 1945-1991
- The European Recovery Plan, also called the Marshall Plan, was a combined effort to rebuild Western Europe.
- Without outside intervention, many in the UK and Western Europe would have starved due to the loss of agricultural production and massive debt.
- The Marshall Plan was successful economically, but some cite the Marshall Plan as increasing the tension between the US and the Soviet Union.
- Conditions during Post-War Europe set the stage for the Cold War
References
- Gerhard L Weinburg, A World at Arms: A Global History of World War II (1994), 13.
- Barry Eichengreen, The European Economy Since 1945: Coordinated Capitalism and Beyond (2007), 63-69.
- George Marshall, The Marshall Plan Speech, Harvard University (Jun 5, 1947).
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