Rapprochement With Realpolitik

Chapter 4 (Part 4 of 4) of the book

The Discovery of First Principles, Volume 3

Edward J. Dodson

Thanks to the dedication and generosity of industrialist John C. Lincoln, the Henry George School in New York received sufficient funding to mount a credible education program and attract hundreds of students to classes and lectures each year. Although the School's programs were designed to appeal to a broad cross-section of thoughtful people, the School had no standing with the academic community. Georgists carried the peculiar burden of being thought of as cultist. As Rhoda Hellman - who attended many of the School's lectures and seminars -- points out in her assessment of the School, outside of Chodorov very few of the directors and instructors during the 1940s and 1950s were college graduates. Almost none had formally studied economics, political philosophy or political science before undertaking the study of political economy as defined by Henry George. This shortcoming made the instructors less effective than they otherwise might have been in putting George's analysis in the proper context and thereby becoming simultaneously informative and persuasive. " If one's chief motive for investigating other ideas is to compare them with a theory already beloved," writes Rhoda Hellman, "it is almost inevitable that they should not be given as objective consideration as if they had been part of a prior education."[161] Thus, although many students came through the School, only a small minority emerged committed to societal adoption of Henry George's proposals. Citizen education required a very long-term view and commitment. Georgists had virtually no influence in the policy making arena, had no constituency to speak of and were struggling to overcome the new conventional wisdoms. Yet, so long as John C. Lincoln[162] lived, the School carried on its work with adequate if not unlimited resources. These struggles and others within the Remnant went virtually unnoticed outside the small circle of people directly involved.

Even Robert Hutchins, the nation's most determined advocate for a return to the classical liberal education, seemed helpless to stem the rising tide of intolerance and political orthodoxy being spread under the banner of anti-communism. One thing he had managed to accomplish was to bring Mortimer Adler in to the Ford Foundation during the summer of 1951 to conduct a seminar on civil liberties and the meanings of freedom. Out of this came the idea of creating the Fund for the Republic to investigate the state of liberty in the United States, and a year later the Fund's trustees were selected and initial funding from the Ford Foundation provided. When Hoffman's resignation from Ford was announced in January of 1953, the Fund's trustees almost immediately invited him to become chairman. Republican Congressman Clifford P. Case of New Jersey, who had decided to step down and run for governor, was recruited to become the Fund's President. When his gubernatorial campaign failed to generate sufficient support, he left the Congress at the end of August and eased into his new position at the Fund. Case understood well the political environment in which the Fund was about to plunge. "When we present facts," he warned his fellow directors, "the public must believe we are giving it the true story and the whole story."[163] Case realized, of course, that the standards of objectivity imposed on those who sought to defend liberty from erosion were -- in the present climate of distrust of intellectuals -- one-sided. "It would be unrealistic not to recognize that some suspicion exists that the primary concern of the Fund itself is not the preservation of our freedoms as such," he added, "but the special interests of the liberal and intellectual groups whose freedoms are currently under particular attack."[164] Henry Steele Commager advised Case to bring the debate over civil liberties as far down to the level of the average citizen as possible by means of the mass media. However, before Case could do much more than evaluate options Eisenhower called on him to run for a seat in the U.S. Senate, and he left the Fund in March of 1954. A month later, Robert Hutchins took over as president.

Hutchins and the Fund for the Republic now operated under a heightened sense of urgency. Despite Truman's efforts to find and purge the Federal government of any communists or communist-sympathizers, Adlai Stevenson was defeated by Dwight D. Eisenhower in the Presidential election of 1952. For almost the entire postwar period, Eisenhower had been courted by the conservative and liberal establishment elites in the expectation that his broad popularity could be converted into political power. They learned that Eisenhower held strong opinions not merely on how to deal with the Soviets and Chinese communists but on the relationship between the individual citizen and government as well. Unlike many within the traditional conservative ranks, Eisenhower feared the rising concentration of political power and the economic imbalances inherent in wealth concentration. To the extent he could, he was determined to use the powers of the Presidency to reduce taxation and government spending, encourage private enterprise, advance the cause of equality of opportunity (although not the integration of African-Americans with European-Americans) and tame inflation. He described himself as a progressive who believed that "liberty is not possible for one except as it is defined and limited by equal liberties for others."[165] Despite the nobility of his expressed sentiments, however, Eisenhower demonstrated he had joined the ranks of, had become one with, the Republican Party mainstream -- the architects of interventionism on behalf of the propertied and of the national security state. Their selection of Eisenhower was opportunistic, to be sure, but also indicated a grudging acceptance of the basic social welfare contract hammered out by Roosevelt and Truman. By recapturing the Presidency and a larger share of the Congress, they were also determined to make sure their interests as agrarian and industrial landlords were aggressively defended.

John Foster Dulles finally realized his ambition by becoming Eisenhower's Secretary of State, an assignment made increasingly difficult because of ongoing attacks on the reputations of career foreign service officers. George Humphrey, a firm fiscal conservative, joined the administration as Secretary of the Treasury. Eisenhower's close advisers included banker Robert Cutler and economist Gabriel Hauge.[166] Arthur Burns took time away from Columbia University to head the Council of Economic Advisers. Key cabinet officers and others formed Eisenhower's National Security Council (NSC), a group the President charged with looking after the nation's economic as well as military interests. Nelson Rockefeller was appointed chairman of an Advisory Committee on Government Organization and periodically attended Cabinet meetings and those of the NSC. In order to achieve the objectives identified by Eisenhower, the NSC instituted a policy of funding covert operations under the control of the CIA -- ostensibly directed against international communism but which took on an increasingly perverse character. One perspective on the real motives and consequences of this policy is offered by Eisenhower biographer Blanche Cooke:

NSC ... ended all pretensions about territorial integrity, national sovereignty, and international law. Covert operatives were everywhere, and they were active. From bribery to assassination, no activity was unacceptable short of nuclear war. Named a moral crusade against communist tyranny, America's commitment to lead the free world was a life-and-death contest for access and control of the earth's resources.[167]

A highly-visible test of U.S. respect for the right of self-determination among emerging nations came in 1951, when the Iranian Prime Minister, Mohammed Mossadegh, announced his government was nationalizing the assets of the Anglo-Iranian Oil Company. Eisenhower dispatched Averell Harriman to Iran in an effort to obtain concessions from Mossadegh. When this effort failed, Iran became the subject of a CIA covert operation to overthrow Mossadegh and install a more docile regime.[168] Eisenhower later acknowledged that he "conferred daily with officials of ... the Central Intelligence Agency and saw reports from our representatives on the spot who were working actively with the Shah's supporters."[169] Allen Dulles assigned to Kermit Roosevelt (head of the CIA's Middle East Department) the task of rescuing the Shah, whose full name was Mohammed Reza Pahlavi, and watching over him until circumstances permitted his return to power. Leonard Mosley explains how CIA money was used inside Iran:

The Iranian army was thoroughly bribed. The police force was fixed. Some of Mossadeg[h]'s more powerful supporters were quietly spirited away, their throats slit, their bodies buried in the Elburz Mountains. Demonstrators were hired. A revolt was then organized and orchestrated by the CIA, and, with hardly a shot fired, the amiable and torpid Mossadeg[h], who had simply wanted to get the international oil cartel off his country's back, was easily toppled.[170]

Elsewhere in the Middle East, the U.S. State Department had been instrumental in pressuring Aramco to yield to Saudi demands for what Daniel Yergin describes (in the language of political economy) as "a renegotiation of the original concession so that the governments 'take', its share of the rents, would be much increased."[171] In a major concession to vested interests, virtually all of the increase came not from Aramco revenues but from what previously had gone to the U.S. Treasury. A similar agreement soon followed in Kuwait. In Iran, the Shah had also pressed the British for substantive concessions and increased royalties. Although a new agreement was reached in mid-1949, the Iranian Parliament refused to sanction the agreement and called for nationalization of Anglo-Iranian holdings. The Iranian Prime Minister, who opposed nationalization, was assassinated. Mossadegh became Prime Minister, and the Iranians attempted to take control of the oil industry and end Old World imperial intervention. Negotiations continued for a settlement of some sort, with Averell Harriman sent by Truman to broker a deal. This proved impossible, Mossadegh fearful that any compromise on his part would bring his own assassination by radical Moslem nationalists. "Meanwhile, in the oil fields and at the refinery," writes Daniel Yergin, "operations were grinding to a stop. The British managed to mount an embargo ... and the Bank of England suspended financial and trade facilities that had been available to Iran."[172] By the end of September, 1951, all British citizens were gone from Iran. Oil exports ceased and production fell to less than five percent of peak capacity. Without oil revenues, Iranian society became ungovernable. Mossadegh was forced to declare martial law and attempted to establish a dictatorship. All but his most ardent supporters turned against him. In the face of evidence suggesting Mossadegh was looking to the Soviets for support, Winston Churchill (returned to power in Britain at the head of a Conservative government) initiated a plan for his overthrow. Eisenhower was convinced as well by John Foster Dulles that Mossedegh had to go, and Roosevelt was charged with working out the details. After initial failure, CIA involvement helped to gather enough support for the Shah to drive Mossadegh from power. The U.S. then channeled around $110 million in economic and military assistance to the Shah, who dutifully de-nationalized Iranian oil. Under heavy pressure from the U.S. and British governments, a consortium of companies active in Middle East oil production was formed and a new revenue-sharing agreement with Iran negotiated. One of the great ironies, of course, is that the U.S. government became a key agent in the prevention of populist and nationalist factions from taking power after throwing off Old World colonialism. Under the Shah, as in virtually all similar post-colonial power grabs, neither participatory government nor broad distribution of revenue generated by sale of natural resources were adopted as governing principles. As under state socialism, these societies operated almost entirely under elitist dictates and coercive application of morally relativistic laws.

The French, meanwhile, had already received from Truman some $30 million to assist them in subduing Ho Chi Minh and the communist nationalists in Indochina. By 1952, the French had spent $3.5 billion and lost 50,000 men killed. Eisenhower, Dulles and others in the U.S. government now worried that the whole of Asia would begin to fall -- like dominoes - to communist rule. "We as a nation could not stand aloof," Eisenhower later recorded, "unless we were ready to allow free nations to crumble, one by one, under Communist pressure."[173] Despite a very clear assessment by the U.S. State Department of continued French imperial designs and policies, Eisenhower obtained nearly $400 million from the U.S. Congress to allow them to continue the war in Southeast Asia. The average American could have cared less. Even the Korean conflict, in which "a few men chosen at random sacrificed their lives,"[174] was of little interest to Americans absorbed by their newfound prosperity. They had no room for communists at home but this in no way meant Americans accepted the interventionist foreign policy being advanced by their government.

Eisenhower, for his part, was determined to bring U.S. losses and expenditures in one arena - Korea -- to an end. He was less than anxious to again commit conventional forces to another conflict in which the opposing force could retreat at will to "a sanctuary from which he could operate without danger to himself."[175] Eisenhower decided to give the North Koreans (and Chinese) a clear demonstration that unless they moved quickly toward peace he was prepared to destroy the Chinese bases in Manchuria. Although this threat generated a resumption of negotiations for an armistice, Syngman Rhee denounced the process as condemning millions of Koreans to permanent communist subjugation and did his best to sabotage the process. After long consultations with U.S. representatives, Rhee finally issued a public announcement that he would adhere to the terms of an armistice. At the end of July, 1953, the armies disengaged. Relieved that war had not spread to Chinese territory, Eisenhower now contemplated the beginning of detente with the new Soviet leadership. Dulles and the ultra-nationalist anti-communists also reluctantly accepted that China was, indeed, lost. What they now feared was Chinese support of other communist-led uprisings in Southeast Asia.

Even before the Korean armistice, Eisenhower demonstrated he was anxious to set the stage for rapprochement with the Soviets. On April 16, 1953, he delivered a speech to the American Society of Newspaper Editors containing a broad statement of support for peace and world reconstruction initiatives that called for Soviet participation. Winston Churchill followed with a recommendation that the Soviets be invited to a summit meeting with the social democracies. Dulles, strongly influenced by Konrad Adenauer's anti-Soviet stance and his own view that Soviet power in Europe could be broken with time and the help of covert CIA actions, prevented the summit from developing. Dulles also saw to it that Paul Nitze (brought to the State Department by Dean Acheson, and the person responsible for Eisenhower's speech, was sent packing. Nitze moved on to take a position at the School for Advanced International Studies in Washington, D.C., while Dulles -- ignoring the change in Soviet leadership and the end to the U.S. nuclear monopoly - "gave a speech at the Council on Foreign Relations in New York proclaiming the doctrine of massive retaliation."[176] That was in January of 1954, a year in which Eisenhower's defense budget was being cut by $5 billion -- with even more cuts scheduled.

Despite Eisenhower's wariness of the corporate vested interests in U.S. foreign policy, he unwittingly pulled the United States government along a path that sanctioned moral relativism as a necessary price for preserving and expanding the American System (absent, it must be said, most of what the Democracy ostensibly stood for). Keeping Iran out of the Soviet or Islamic nationalist orbits was accomplished only by the use of the same kind of treachery for which Stalinism was justly condemned. Multi-national business interests were encouraged to form cartels under the guise of becoming economic agents in the anti-communist crusade. With John Foster Dulles as Secretary of State and his brother Allen as head of the CIA, U.S. embassies, military outposts and other offices became centers of intelligence gathering, espionage and covert operations. A tunnel was dug into East Berlin to tap into East German telephones. The U-2 spy planes were constructed and pilots (U.S. and British) were trained to fly over Soviet territory. The CIA planned an invasion of Guatemala to overthrow the government of Jacobo Arbenz Guzman, who they viewed as a communist and a threat to anti-communist stability in Latin America.

Peace-threatening events now seemed to erupt in rapid-fire succession. Even the Old World social democracies were still struggling for financial stability, their citizens impatient with attempts to resuscitate costly imperial adventures. Even the French had finally faced reality and agreed to a withdrawal from North Vietnam.

An entirely new dynamic was added to global tensions after the Israelis launched a pre-emptive strike into Egypt on October 29, 1956 (only days after Hungarian students and workers began an open resistance to Soviet occupation). Anthony Eden, who succeeded the retiring Churchill in April of 1955 as Britain's Prime Minister, had been waiting for an opportunity to overthrow Nasser and retake control of the nationalized Suez Canal Company. For Eden, loss of Suez was a blow to British prestige he was loathe to accept, particularly from someone he considered to be a dictator with territorial aspirations achieved at British expense. The French (angry that Nasser was agitating against them in Algeria) joined in on the crusade, after first arming the Israelis with modern fighter jets and other weapons. U.S. interests were interlocked with the Cold War and fear of shocks to the global economic system. When the fighting began, the British and French demanded that Egypt pull its forces away from the Canal Zone. Nasser refused, and the two European powers promptly destroyed the Egyptian air force. Egyptian ground forces were smashed by the Israelis and the Sinai occupied. The only Egyptian success was in sinking enough ships in the Canal to close it down for months after the fighting stopped.

With the attention of the Western leaders focused on the Middle East, Khrushchev dispatched an army of some 200,000 ground troops, supported by 2,500 tanks and other armored vehicles, into Hungary. At the direction of Eisenhower, the CIA was forced to sit on the sidelines while the Soviets destroyed Hungarian resistance. The Hungarians sought assistance from the UN, but the Soviets vetoed a resolution introduced by the United States. The best that Eisenhower could do was to offer refuge to any Hungarians who managed to escape. The UN was more effective in responding to the Middle Eastern crisis, where neither U.S. nor Soviet interests were served by a return of French and British power in conjunction with an expansion of Israeli territory at Arab expense. On November 2, the UN General Assembly adopted a cease fire resolution and proposed establishing a UN police force to operate in the Canal Zone. The Soviets threatened intervention on the side of Egypt, and Eisenhower declared the U.S. would employ economic sanctions[177] against Britain and Israel. These threats were strong enough to force British agreement to a withdrawal in favor of a UN Emergency Force.

Another crisis had come and gone, leaving the root causes of conflict unresolved. Arabs as a whole wanted neither Old nor New World imperial prerogatives interfering with their claims to sovereignty. Within and between their own very tribal societies, Arab factions continued to struggle for power. Modernization threatened ancient traditions and the Moslem-dominated hierarchical structure. Yet, the defeat of the Egyptian military demonstrated to many Arabs the need for the development of modern infrastructure. "Suez," writes John Spanier, "thus resulted in the collapse of British power in the Middle East, the strengthening of Arab nationalism, and the consolidation of Egyptian-Russian links."[178] At the same time, Israelis had demonstrated their ability and willingness to defend their own claim to territorial sovereignty from surrounding Arab states.

The United States walked away from its one opportunity to materially influence future events in the Middle East when John Foster Dulles withdrew U.S. financial support from the Aswan High Dam project. Egypt's ambassador in the U.S. inadvertently lessened the pressure on Dulles by suggesting the Soviets were standing in the wings ready to provide financing and technical assistance. Without U.S. participation in the project the World Bank also backed away. Nasser was left with only one ready source of revenue to complete the dam -- nationalization of the Suez Canal Company. Once the British and French finally withdrew from the Canal Zone, the waterway was cleared and brought back into operation by April, 1957. Nasser was walking a fine line of non-alignment. He arrested communists in Egypt and outlawed the Communist party, yet accepted Soviet assistance in building Aswan. Khrushchev was also uncomfortable with this relationship, angering Nasser by suggesting the Egyptian leader failed to grasp the global political situation or the inevitable ascendancy of communism. A staunch nationalist, Nasser held no sympathy for the Soviet form of state socialism and would stomach no attempts by communists to undermine his power.

Elsewhere, the Arab world was in a state up upheaval. In April of 1957 King Hussein dissolved the Jordanian government and assumed full control. Hussein faced broad opposition from Arab nationalists but emerged solidly in control. Egypt and Syria were at the same time in the process of creating the United Arab Republic. A coup in Iraq brought General Kassem to power at the head of a regime determined to challenge Nasser's self-proclaimed role as leader of the Arab nationalist movement. The United States and Britain responded by sending troops into Lebanon and Jordan, respectively, to help stabilize these nominally pro-Western governments. In the midst of this chaotic situation, John McCloy (a key figure attached to the Rockefeller oil interests) was dispatched by Eisenhower and Dulles to gain agreement from Saudi Arabia's King Ibn Saud to distance himself from Kassem and Nasser. Kim Philby, now working as a correspondent for The Economist and The Observer, as well as Soviet intelligence, also arrived in Lebanon on September 6, 1956 to witness the final loss of British influence in the area. A new era was beginning, described by Philby's biographer as one in which "Pax Britannica was replaced by Pax Americana and Pax Sovieticus, the SIS by the CIA and the KGB."[179] Philby had done his best to over the span of decades to contribute to that end.


On the evening of January 17, 1960, Dwight D. Eisenhower stepped before the citizens of the United States to issue a stern warning, letting them know the nation had been committed to a dangerous new course, one that ran counter to the history and experience of the Democracy:

Until the latest of our world conflicts, the United States had no armaments industry. American makers of plowshares could, with time and as required, make swords as well. But now we can no longer risk emergency improvisation of national defense; we have been compelled to create a permanent armaments industry of vast proportions. ...

This conjunction of an immense military establishment and a large arms industry is new in the American experience. The total influence -- economic, political, even spiritual -- is felt in every city, every state house, every office of the federal government. We recognize the imperative need for this development. Yet we must not fail to comprehend its grave implications. Our toil, resources, and livelihood are all involved; so is the very structure of our society.

In the councils of government we must guard against the acquisition of unwarranted influence, whether sought or unsought, by the military-industrial complex. The potential for the disastrous rise of misplaced power exists and will persist.

We must never let the weight of this combination endanger our liberties or democratic processes. We should take nothing for granted. Only an alert and knowledgeable citizenry can compel the proper meshing of the huge industrial and military machinery of defense with our peaceful methods and goals, so that security and liberty may prosper together.[180]

Eisenhower had, of course, contributed mightily to the very military-industrial complex he now feared. Even more damaging was the fact that during his administration the CIA became an instrument of the national security state, exercising broad and virtually uncontrollable powers previously justified only under wartime conditions. One wonders how the same person, reflecting on his years in office, could subsequently write -- and honestly believe -- that U.S. "purposes abroad have been the establishment of universal peace with justice, free choice for all peoples, rising levels of human well-being, and the development and maintenance of frank, friendly, and mutually helpful contacts with all nations willing to work for parallel objectives."[181] He was prepared to admit, however, that many mistakes had been made, particularly with regard to the peoples of the south American nations, where "the masses ... felt that we were supporting and strengthening the prevailing social order, which in their view denied them simple justice."[182] The truth was, that securing and maintaining even a semblance of the just society in much of the world proved well beyond the capacity or interests of U.S. political leaders, Eisenhower included. And, in the anti-communist atmosphere of the 1950s, far too many intellectuals and academicians succumbed to moral relativism, abandoning principle in order to rationalize U.S. interventionism.

In the heat of the battle, moral relativism spilled over into the educational system, gradually displacing educators such as Robert Hutchins who believed that formal education embodied the inculcation of values and citizenship. In 1968, he observed that "it is naive, or even disingenuous, to expect an educational system to develop intelligent human beings if all the forces of the culture are directed ... to developing producers and consumers," adding, "education is often resorted to as a means of avoiding the thought, effort, and risks of dislocation that a frontal attack on social problems would require."[183] The downtrodden were somehow expected by the defenders of the status quo to rise above their economic circumstances and the inequality of opportunity imposed upon them by existing socio-political arrangements and institutions. Some -- the extraordinary, the very talented, the most disciplined and determined -- succeeded. Most did not. Yet to acquire a formal education and a degree from an institution of higher learning was accepted by almost everyone as the key to a better life.

The architects of Liberalism also realized that the new technological age demanded a work force with well-developed skills and a societal value system that stressed cooperation over competition, inclusion instead of segregation. Looking ahead to the second half of the twentieth century, the planners and policy analysts argued that the Democracy would have to undergo an enormous transformation if workers, business owners and government agencies were to work toward the same national objectives. Business owners, in particular, would have to begin taking a longer-term view and look at their workers as important contributors to the production process rather than as interchangeable inputs. For many U.S. companies, top-down management was so ingrained they would never awaken to the emerging challenges. More than a few would lose their markets to more efficient competitors and fail. Others would be acquired by more profitable enterprises eager to expand into new areas of wealth production. For others, the foreign policy interests of their government would provide a prolonged (and often weakening) source of subsidy.

Leadership in the global arena demanded of the United States a posture unfamiliar to the overwhelming majority of its citizens, only a fraction of whom had ever traveled abroad. Of those who acquired intimate knowledge of other societies and political systems, only a small percentage came into government service or business. Within the general population, the challenges of starting a family and earning a living tended to divorce people from any deep interest in the political process or world affairs. Interest in obtaining a college education was mushrooming, and a growing number of college graduates came from working-class families to taken on management positions within corporate America. Others went on to graduate school to pursue degrees in medicine, law, engineering and the sciences. Most were, however, inwardly focused on careers and achieving financial well-being rather than on societal improvement. And, as Robert Hutchins warned, the curricula at far too many colleges and universities shifted away from intellectual to professional development. The younger generation saw what the status quo could provide, and they wanted their share of the action. They were not interested in making waves or challenging the right of the Establishment to run things. Too few were listening when Dean Acheson (accepting the annual Freedom Award from Freedom House) issued a stern warning to his fellow citizens:

Foreign policy is not a disembodied thing. The outward strength of a democracy can be no greater than its inward strength. As we at home make progress in achieving the promise of our society -- as we encourage the individual's opportunities -- as we strengthen the foundations of justice and freedom -- so shall we demonstrate that democracy is a vital, a progressive, a hopeful way of life. The vitality of our free institutions at home, of our individual and community life, will determine the influence we can exert abroad in support of freedom.[184]

Four years later, the same award was presented to Edward R. Murrow for his role in discrediting the tactics (and personal character) of Senator Joe McCarthy. William F. Buckley, Jr., who defended McCarthy's sincerity and nobility of purpose if not his theatrics, remarked that Murrow's highly selective use of McCarthy on film presented an entirely unbalanced picture of the Senator's behavior. "I never knew anything McCarthy had said that could equal in vileness some of the things that were said about him,"[185] Buckley later wrote. If those close to Murrow are to be believed, he was also troubled by the difficult task of fairly depicting the true nature of McCarthy in a half hour television program. Already, the challenge of containing the manipulative power of television struck Murrow as an awesome responsibility. After the broadcast Murrow received notes of congratulations from those who occupied the Center or Left-of-Center -- including Chief Justice Earl Warren, Clark Clifford and Albert Einstein. Thousands of ordinary citizens from all across the United States also sent words of approval and appreciation. Public opinion now began to work against McCarthy, and in December his colleagues in the U.S. Senate voted overwhelmingly to censure him.

Ironically, the fall of Joe McCarthy came as a welcomed relief even to many ardent anti-communists. For, as McCarthy biographer David M. Oshinsky concludes: "He had a devastating effect on government morale, and he made America look ridiculous -- and frightening -- in the eyes of much of the world."[186] Walter Lippmann clarifies:

The heart of the damage is the fact that the government has allowed itself to be intimidated by an ambitious and ruthless demagogue. This damage, permitting ourselves to be intimidated, can be repaired only when it has been proved to ourselves and to the world abroad that nobody is afraid any longer.

...McCarthy's power is built not upon the Constitutional right of Congress to investigate but upon a flagrant abuse of that right. The abuse of that right is unchecked because the Senate is not observing faithfully its Constitutional obligations and because of an unnecessary acquiescence by the President in the abuse. ...

One of the contributing reasons is that the party bosses have regarded McCarthy as a political asset. Another is that a large number of the senators have been afraid of him, afraid of being attacked personally or politically by him. Another contributing reason is that many senators have not known how to meet the charge that only Communists are opposed to McCarthy, and have reluctantly had to admit to themselves that the cheapest and easiest way not to look red or pink was to be yellow.[187]

No one really knew with any degree of certainty just how deeply the communist menace penetrated the Democracy; that was one of the things that kept McCarthyism going. A large enough number of former communists had come forward with their stories and information about others to perpetuate the atmosphere of fear. In response to this challenge, the Fund for the Republic supported preparation of a detailed study under the direction of Clinton L. Rossiter of Cornell University on the influence of communism in the United States. Rossiter was at the time working on a separate project, a history and analysis of the meaning of conservatism,[188] yet found time to oversee the project. The first volume of the study, written by ex-communist Theodore Draper and titled The Roots of American Communism, appeared early in 1958. Five more volumes were published by 1960.

By 1954, McCarthy had become a liability to the Republican Party, a fact even Richard Nixon acknowledged. Both parties campaigned as staunchly anti-communist during the 1954 elections, with the Democrats gaining control of the House of Representatives and the Senate. The mood of the country was changing. Over the next few years, the U.S. Supreme Court ruled against many state sedition acts and laws designed to restrict free speech. In the aftermath of the McCarthy hearings, Dean Acheson reminded Americans "that people who allow themselves to be frightened into hysteria and general distrust make fools of themselves, lose the respect of others, and usually perpetrate grave injustice."[189] He accepted responsibility, on behalf of the Truman administration, for failing to recognize the grave dangers inherent in a broad loyalty program using "secret evidence and secret informers"[190] to condemn individuals without an opportunity to face their accusers. Another serious consequence of McCarthyism on the course of U.S. policymaking is identified by historian Adam B. Ulam:

Domestically, it set back what had been a growing maturity and sophistication of both the intellectual community and the public at large on the subject of Communism and radical ideologies in general. By 1948, Communism was a most insignificant, even picturesque, feature of the American scene. The broader spectrum of ritualistic radicalism with its toleration and concealed admiration for Communism had suffered what seemed like an irretrievable collapse with the fiasco of the Progressive party that same year. McCarthyism can be charged with restoring some the respectability of the extreme Left by endowing it with a halo of martyrdom. It is especially on the sensitive ego of the intellectual community that McCarthyism left a scar. The criteria of loyalty and adherence to the American form of government would for many never lose the partly ridiculous and partly sinister connotations they had acquired through the Senator's antics. The time would come when any call for restraint or self-examination brought forth from the academic and information-media community visceral reactions and cries of "McCarthyism." Thus the lasting damage to the thinking processes of a democracy.[191]

In the aftermath of these convulsions, Eisenhower emerged as the clear and undisputed leader of mainstream America. Despite the continued investigations of Attorney General Herbert Bronwell, Eisenhower asserted he had no sympathy for McCarthy "and his cult"[192] in their search for communists in every corner of the United States. More importantly, with McCarthyism discredited, Eisenhower could now safely proceed with his own agenda.

State Socialism: The Struggle for Legitimacy

After the death of Stalin in 1953, the Soviet Premiership was given over with significantly reduced power to Georgy Malenkov (then a deputy premier). The key Soviet leaders also reduced the size of the Presidium of the Central Committee from thirty to ten members. In addition to Malenkov, the Presidium included Beria, Molotov, Khrushchev, Bulganin and five others. Khrushchev was also appointed First Secretary of the Communist Party's Central Committee, a position that would involve him in regional and local affairs -- and particularly in the implementation of agricultural policy, where reforms he introduced successfully yielded (in the short run) increased output and some improvement in rural living conditions. Beria, as head of Stalin's secret police, was too dangerous to be permitted to survive. Despite his friendship with Malenkov, he was arrested in June, put on trial and then executed.

The Soviet leaders now faced the difficult task of institutionalizing their own positions, acquired directly or indirectly as a result of Stalin's many purges. The Soviet public was demanding the release of millions of political prisoners and accountability for the brutality. By the end of 1955, something like 20,000 former party and government officials were released and rehabilitated. Between 7 and 8 million others were released over the next two years. Their return promised to have a dramatic impact on the Soviet socio-political hierarchy, as described by two Soviet dissidents in 1976:

[T]he millions of people who had survived but not forgotten the camps and who had now rejoined the mainstream of ordinary life, as well as the millions of others whose fathers, brothers, or husbands had been rehabilitated, became a major source of ferment in Soviet society and began to demand ironclad guarantees of due process of law and absolute safeguards against any possibility of a return to repression and terror.[193]

This, the Soviet leadership was not yet prepared to do. What we know as the KGB[194] was subsequently created to replace Beria's secret police organization. The KGB (through retirement or demotion of senior officers) was purged of Stalinists and its powers severely curtailed. Soviet courts were given the responsibility for all trials and sentencing of those convicted of crimes, and the prison system was transferred to the Ministry of Internal Affairs. These measures removed the fear of arbitrary arrest and punishment by the central government and restored considerable power and autonomy to regional and local committees. Many of these changes tended to bring national attention and prominence to Khrushchev.

The process of de-Stalinization reached its climax in 1956 at the Twentieth Party Congress, where Khrushchev seized the opportunity to deliver a stinging denunciation of the Stalinist regime. This speech shook the communist world and contributed to the uprisings against Stalinist leaders in Poland and Hungary. Khrushchev was also instrumental in getting the Soviet leadership to think and act pragmatically. His travels outside the Soviet Union exposed him to the technological accomplishments taking place within the social democracies. Returning, he strongly encouraged innovation and funding of scientific research. He advanced a plan to significantly expand the amount of land under cultivation, with Kazakhstan targeted for large-scale settlement. Vast numbers of tractors and other types of farm equipment were shipped to the East during 1954 and 1955. Yet, that first year turned out to be disastrous because of an absence of rainfall, with the result that Khrushchev's position was jeopardized. The weather saved him in 1956, the rains falling in the East rather than the West. The Soviet Union actually experienced its largest grain harvest ever. Unfortunately for Soviet farmers, however, decisions over what crops to grow and what agricultural methods to employ remained the province of the Central Committee. Khrushchev, extremely anxious to expand the nation's supply of corn, had the Central Committee order farmers to plant corn (without regard to soil and weather conditions).

The forces unleashed by Khrushchev were impossible to control. People already lived at the edge of subsistence under state socialism. Their hopes were temporarily raised by Khrushchev's populist initiatives, but they were demanding too much, too soon, and the Soviet leadership turned conservative. Hardliners joined forces in an attempt to remove Khrushchev as First Secretary, but failed. Khrushchev's supporters responded en masse to what they saw as an effort to once again subvert the Soviet constitution and re-establish an elitist hierarchy. Malenkov, Molotov and six others were removed from the Presidium and assigned to obscure positions without influence. Even Zhukov, loyal to Khrushchev but feared as a potential rival to civilian authority, lost his position as Minister of Defense. Fedor Burlatsky recalls that Zhukov's declaration against the old guard - "The army is against this decision, and not one tank will move without my orders."[195] -- was enough to seal his fate. In doing so, however, Khrushchev revealed a serious flaw in his character that eventually brought about his own loss of power:

Khrushchev always preferred to associate with flatterers than with those who genuinely supported his reforms. This is why he surrounded himself with men ... who looked starry-eyed at him and [were] willing to carry out any assignment. This is also why he was not impressed by independent and strong-minded people. Khrushchev was too self-confident to rely on others. ...Those people who deep down did not share his reformist views and thought them incompetent and even eccentric got rid of him at the first convenient moment, and he had no allies to fall back on.[196]

For the time being, however, Khrushchev's power and stature continued to grow. In 1958 he added the Council of Ministers chairmanship to his position as First Secretary. And then, his hasty decisions on agriculture returned to threaten him once again. In an effort to make the state farms more self-sufficient, Khrushchev ordered the wholesale transfer of all equipment to the farms. Many state farms were unprepared to absorb the costs of purchasing, housing and maintaining tractors and other equipment. Prices the farmers were required to pay were double what the government equipment agency had paid, leaving little funds for other projects or wages to farm workers. Many technically-trained workers migrated to the cities rather than work on the farms, creating a serious shortage of equipment operators and repairmen. Almost immediately, equipment fell into disrepair and new equipment coming off production lines sat waiting for buyers. Over and over, Khrushchev displayed his inability to think decisions through. Farmers were committed to achieving impossible increases in output, which resulted in serious misallocation of manpower and resources. Large tracts of land, ravaged by wind and inappropriate methods of cultivation, succumbed to soil erosion. The stage was set for wholesale disaster. Then, after visiting the United States in 1959, Khrushchev embarked on another departure from traditional Soviet planning. He moved the Ministry of Agriculture out of Moscow and directed its staff to create a model farm to test new agricultural methods. Once again, Khrushchev paid no attention to detail and ordered the decentralization of agricultural planning almost without advance preparation; more than half of the senior ministry officers and staff resigned.

Despite his poor decision-making, Khrushchev recognized that only by virtue of materially improving the standard of well-being of Soviet citizens would his nation's experiment in state socialism be measured a success. Soviet progress would ultimately be measured against that of the United States. Relations between the two countries was bound to remain competitive -- a competition that encompassed nationalistic pride, ideological struggle and positioning for dominance within the global hegemony of nation-states. Stalin was gone, the conflict in Korea suspended and the United States Presidency occupied by a man respected as a primary architect of the Allied victory against the German Reich. With all the problems facing them at home and within their satellite states, the Soviet leadership needed and welcomed a reprieve from direct confrontation. Solzhenitsyn, writing in 1980, described U.S. diplomats, policy analysts and scholars as extraordinarily naive, disingenuous, or both in their assessment of Soviet aspirations. Men such as Averell Harriman and George Kennan, in suggesting that U.S. policy ought to be designed to strengthen Kremlin moderates, asked the West to believe the impossible. Appeasement, he argued, had allowed Soviet leaders to tighten their grip on a wholly oppressed population. "It is not the average Russian who feels compelled to hold other nations captive, to keep Eastern Europe encaged, to seize and arm far-off lands," wrote Solzhenitsyn; "this answers only the malignant needs of the Politboro."[197]

The Soviet leadership had done all it could to stamp out Russian nationalism, the resurrection of which Solzhenitsyn prayed for as the only force powerful enough to bring down communism. Having suffered so many years in the gulag archipelago where millions had perished, Solzhenitsyn was as ignorant of the mentality of Americans as they were of the many Soviet peoples. Eisenhower knew that the people Americans cared most about were themselves. Unless the security and the sovereignty of the United States was threatened, Americans would not long stand for the sacrifice of the nation's sons and daughters to fight on behalf of others. Two decades later, with more than four million U.S. troops committed to battle in Southeast Asia, and the Democracy in crisis, Lyndon Johnson still had not learned this lesson. The day after Johnson announced his decision not to stand for re-election, Eisenhower wrote this in his private journal:

To me it seems obvious that the President is at war with himself and while trying vigorously to defend the actions and decisions he has made in the past, and urging the nation to pursue these purposes regardless of cost, he wants to be excused from the burden of the office to which he was elected.[198]

Examining his own Southeast Asia decisions and actions from the perspective of 1965 and rapid escalation of U.S. involvement, Eisenhower stuck to the same argument he had made over Korea. The nation should never commit its manpower and financial resources to a conflict unless prepared to do whatever was necessary to win both the war and the peace. To do otherwise was to jeopardize the Democracy:

The Communists know, as we do, that the security of a nation depends upon a balanced strength comprised of morale, economic productivity, and military power. The delicately balanced and complex problem constantly posed to us of the United States was, and still is, this: to sustain a national determination to defend freedom with all we have, to devise and maintain indefinitely a military posture of such effectiveness that the Communists will abandon any thought of all-out military attack against us or our allies, and to support this military capacity so prudently as to avoid undermining our economic soundness. We need an adequate defense, but every arms dollar we spend above adequacy has a long-term weakening effect upon the nation and its security.[199]

Fortunately for the United States and the world's other social democracies, totalitarian state socialism proved to be an extremely flawed societal framework. Centralized economic planning could not produce anything close to an adequate supply of housing, food, education, medical care, transportation systems or other goods and services rapidly becoming associated with modern, industrialized societies. The ability of Soviet leaders to mobilize the population declined in direct proportion to their condemnation of the Stalinist regime's reliance on force. They bought stability by asking little of most citizens and, as Solzhenitsyn observed, making sure the cities received a disproportionate share of whatever was produced.

Agrarian and industrial landlordism, softened by participatory government and the spirit of community, proved to be far more resilient than state socialism. Social democracy has had the virtues of an investigative press and media, an expanding transnational view of the earth as one ecosystem and independent challenges to government policy analysts. As the great powers settled in to wait out the end of the Cold War, a parallel struggle also began over what set of values would govern control over the natural environment. To suggest, however, that the status quo was aggressively attacked from positions developed from objectively derived moral principles would be to suggest too much. Ideology and moral relativism dominated the thinking of even the most radical anti-establishment factions.

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