Why the West Rules--For Now (85 page)

Despite the destruction, World War I strengthened Western rule by sweeping away Europe’s archaic dynastic empires and leaving China weaker than ever. The big winners seemed to be France and above all Britain, who not only gobbled up German colonies and pushed their oceanic empires still farther into Africa, the Pacific, and the oil fields of the old Ottoman Empire, but also bullied their Eastern ally Japan into handing over most of the German colonies it had captured. By 1919 more than a third of the world’s landmass and almost a third of its population were ruled from either London or Paris.

Yet the great swaths of color that still marked these empires in older atlases when I was a schoolboy were misleading. As well as strengthening Western power, the war redistributed it. Europe had fought beyond its means and the bills overwhelmed even British credit. Inflation hit 22 percent in 1920; the next year unemployment passed 11 percent. Eighty-six million worker-days were lost to strikes. The sun still never set on the British Empire, but it was struggling to stay open for business.

To pay its debts Britain hemorrhaged capital, most of it flowing across the Atlantic. The war had been hell, but the United States had had a hell of a war, emerging as both workshop and banker to the world. Back in the fifteenth century the Western core had shifted from the Mediterranean toward western Europe and in the seventeenth it had shifted again toward the oceanic empires of the northwest. Now, in the twentieth, it moved once more as northwest Europe’s bankrupt oceanic empires lost out to a North American empire.

The United States had turned itself into a new kind of organization, one we might call a subcontinental empire. Unlike traditional dynastic empires, it had no ancient aristocracy ruling downtrodden peasants; unlike Europe’s oceanic empires, it had no small, liberal, industrialized homeland holding dominion over palm and pine. Rather, after almost exterminating its native population, fighting a brutal civil war, and pushing millions of ex-slaves back into virtual serfdom, Euro-Americans had spread democratic citizenship from sea to shining sea, with prosperous farmers feeding a massive industrial heartland in the northeast and upper Midwest and buying its goods. By 1914 this subcontinental American Empire already rivaled Europe’s oceanic empires, and after 1918 its businessmen went global.

The giant sucking sound of European wealth rushing into the United States astonished contemporaries. An American secretary of state observed, “
The financial center
of the world, which required thousands of years to journey from the banks of the Euphrates to the Thames and the Seine, seems [to be] passing to the Hudson between daybreak and dark.” By 1929 Americans held more than $15 billion in foreign investments, almost as much as Britons had owned in 1913, and their global trade was worth almost 50 percent more.

The golden age of global capitalism seemed reborn under American leadership, but there was one crucial difference. Before 1914, thought
Keynes, “
the influence of
London on credit conditions throughout the world was so predominant that the Bank of England could almost have claimed to be the conductor of the international orchestra,” but after 1918 the United States was unwilling to take on the job. Fleeing Europe’s contagious rivalries and wars, American politicians left the conductor’s podium empty, withdrawing into political isolation worthy of eighteenth-century China or Japan. While times were good the orchestra improvised and muddled through, but when they turned bad its music became cacophony.

In October 1929 a little bungling, a lot of bad luck, and the absence of a conductor turned an American stock market bubble into an international financial disaster. Contagion raced through the capitalist world: banks folded, credit evaporated, and currencies collapsed. Few starved, but by Christmas 1932 one American worker in four was jobless. In Germany it was closer to one in two. Lines of the gray-faced unemployed stretched out, “
gazing at their destiny
with the same sort of dumb amazement as animals in a trap,” the English journalist George Orwell thought. “They simply could not understand what was happening to them.”

At least until the mid-1930s everything the liberal democracies did just made things worse. Not only did it seem that the paradox of development had laid the Western core low; it also looked as if the advantages of backwardness were coming into play elsewhere. Russia, for centuries a rather backward periphery, had been reconstituted as the Union of Soviet Socialist Republics. Like the United States, it joined a burgeoning industrial core to a vast agricultural hinterland, but unlike the United States, it promoted state ownership, collective agriculture, and central planning. The Soviet Union mobilized its people more like a modern Western state than like an old dynastic empire, yet its autocrats Lenin and Stalin ruled more like tsars than democratic presidents.

The Soviet Union was a kind of anti-America—a subcontinental empire, but decidedly illiberal. Stalin preached equality but built a centralized economy by forcibly transporting millions of his comrades around his empire and locking another million in gulags. Ideologically suspect ethnic groups and class enemies (often the same thing) were purged. And unlike the failing capitalist economies, the successful Soviet Union did let 10 million of its subjects starve. Yet Stalin was clearly
doing something right, for while capitalist industry collapsed between 1928 and 1937, Soviet output quadrupled. “
I have seen
the future, and it works,” the journalist Lincoln Steffens famously told his fellow Americans after visiting the Soviet Union.
*

By 1930 it seemed to many that the real lesson of World War I was not that liberal democracy was the shape of the future: it was that the Anglo-Franco-American alliance had won in spite of, not because of, its liberalism. The real answer was subcontinental empire, and the less liberal, the better. Japan, which had profited so much from following liberal models, abandoned them when global markets and its trade-oriented economy went into a tailspin. With unemployment soaring, democracy floundering, and Communist agitation growing, militarists stepped in, baying for an empire Japan could live off. The army—particularly its radical junior officers—went haywire, exploiting the Western democracies’ disarray and China’s civil wars to annex Manchuria and push toward Beijing. “
It is only
by bringing about Japanese-Manchurian cooperation and Japanese-Chinese friendship,” a lieutenant-colonel explained, “that the Japanese people can become rulers of Asia and be prepared to wage the final and decisive war against the various white races.”

Up to a point, militarism paid off. Japan’s economy grew by 72 percent in the 1930s; steel output rose eighteenfold. But once again the costs were high. “Cooperation” and “friendship” often meant enslavement and slaughter, and even by the low, dishonest standards of the 1930s, Japanese brutality was shocking. Further, by 1940 it was clear that conquest had not solved Japan’s problems, since the war consumed resources even faster than it captured them. Of every five gallons of oil the battleships and bombers burned, four had to be bought from Westerners. The army’s plan—keep conquering—brought no relief, and with China becoming a quagmire, an even more alarming naval plan gained traction: to strike into Southeast Asia and liberate its oil and rubber from Western imperialists, even if that meant war with America.

Most alarming of all was the plan coming out of Germany. Defeat, unemployment, and financial collapse scarred the heirs of Goethe and
Kant so deeply that they were ready to listen even to a madman blaming the Jews and peddling the panacea of conquest. “
The first cause
of the stability of our currency is the concentration camp,” Adolf Hitler assured his finance minister as he brutalized and banished Germany’s Jewish business class and threw trade unionists into jail. Yet there was method in Hitler’s madness: deficit spending, state ownership, and rearmament wiped out unemployment and doubled industrial output during the 1930s.

Hitler openly trumpeted his plan to secure Germany’s western flank by defeating the oceanic empires and then to replace eastern Europe’s Slavs and Jews with sturdy Aryan farmers. His vision of a subcontinental empire centered on Germany went beyond illiberal to downright genocidal; and few Westerners could believe he really meant it. Their self-deception brought on the one thing they most wished to avoid, another all-out war. For a few dark months it looked—for the first time since 1812—like a land empire might unite Europe after all, but in an uncanny echo of Napoleon, Hitler was turned back at the English Channel, in the snows of Moscow, and in the deserts of Egypt. Overreaching, he tried to fold Japan’s War of the East into his own War of the West, but instead of knocking Britain out of the war this only brought the United States in. War made bedfellows of the liberal American and illiberal Soviet empires, and despite looting the minerals and labor of Europe and the East, Germany and Japan could not resist these empires’ combined money, manpower, and manufactures.

In April 1945 American and Soviet troops joined hands in Germany, embracing, drinking toasts, and dancing together; days later Hitler shot himself and Germany surrendered. In August, as fire rained from the skies and atomic bombs turned Hiroshima and Nagasaki into ash, Japan’s god-king broke with all tradition to speak to his people directly. Making what gets my vote as history’s greatest understatement, he informed them, “
The war situation
has developed not necessarily to Japan’s advantage.” Even then die-hard generals attempted a coup in the hope of fighting on, but on September 2 Japan surrendered too.

Nineteen forty-five simultaneously ended Japan’s attempt to win the War of the East and expel the Western imperialists, and Germany’s to create a subcontinental empire in Europe, but it also ended the
western European oceanic empires. Too drained by total war to resist nationalist revolts any longer, these melted away within a generation. Europe was shattered. Its “
economic, social and political
collapse,” one American officer mused in 1945, seemed “unparalleled in history unless one goes back to the collapse of the Roman Empire.”

Western social development did not collapse in 1945, though, because the core was by now so big that not even the greatest war ever fought could wreck all of it. The Soviets had rebuilt their industries beyond Germany’s reach, and bombs had barely touched the United States.
*
By contrast, the devastation visited by Japan on China and by the United States on Japan had gutted the Eastern core, with the consequence that the Second World War—like the First—made Western rule still stronger. There seemed little doubt that Western dominance was here to stay; the question was whether its leadership would be Soviet or American.

These two empires divided the old European core between them, splitting Germany down the middle. American moneymen then hashed out a new international financial system for capitalism and crafted the Marshall Plan, perhaps the most enlightened piece of self-interest on record. If Europeans had money in their pockets, Americans reasoned, they could buy American food, import American machinery to rebuild their own industry, and—most important of all—restrain themselves from voting Communist; so America simply gave them $13.5 billion, one-twentieth of its entire 1948 production.

Western Europeans mostly grabbed America’s money, accepted its military leadership, and joined or drifted toward a democratic, pro-trade European union.
^†
(The irony of the United States nudging Europeans toward a pale version of a land empire under West German industrial domination was lost on no one.) Eastern Europeans accepted Soviet
military leadership and a Communist, inward-turned Council for Mutual Economic Assistance. Instead of pumping resources into eastern Europe and promoting democracy, the Soviets pumped resources out and jailed or shot their opponents, but even so, eastern European output regained prewar levels by 1949. In the American sphere things went better still, and with remarkably few jailings or shootings, output doubled between 1948 and 1964.

The American and Soviet empires were not the first to share the Western core, but atomic weapons made them different from all their predecessors. The Soviets tested a bomb in 1949 and by 1954 both sides had hydrogen bombs a thousand times more violent than the weapon that eviscerated Hiroshima—as far beyond it, Churchill wrote in his diary, as the “
atomic bomb itself
from the bow and arrow.” A Kremlin report concluded that war might “
create on the whole
globe conditions impossible for life.”

Yet the mushroom cloud had a silver lining: “
Strange as it
may seem,” Churchill told the British Parliament, “it is to the universality of potential destruction that I think we may look with hope and even confidence.” The doctrine of Mutual Assured Destruction had been born, and although a string of terrifying slip-ups brought the world several times to the brink of Armageddon, in the end the West fought no Third World War.

Instead, it fought a war in the Third World over the ruins of the western European and Japanese empires, waged mostly through proxies (normally rural revolutionaries for the Soviets and thuggish dictators for the Americans). On the face of it, this should have been a walkover for the United States, which bestrode the globe even more colossally than Britain had done a century earlier. In the East in particular, Washington apparently held all the cards. Pumping half a billion dollars into Japan, it created a loyal, prosperous ally, and backed by generous American aid a Nationalist army looked set to defeat Mao Zedong’s Communists and finally end China’s civil war.

The Nationalists’ abrupt collapse in 1949 changed everything, turning the East into the hottest spot of the now-cold War of the West. Stalin encouraged North Korea to invade America’s client state South Korea, and when things went badly Mao joined in too. By the time the fighting ground to a halt in 1953, 4 million people had died (including
one of Mao’s sons) and guerrilla wars were raging in the Philippines, Malaya, and Indochina. American proxies won the first two, as well as a struggle in Indonesia, but by 1968 half a million Americans were on the ground in Vietnam—and losing.