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Terrorism, Economic Growth, And Global Trade

Abstract

The Cold War was a conflict that evolved after WWII between two main actors, the Soviet Union and the United States, and lasted until 1991, when the Soviet system was dismantled. In reality, the Cold War stretched far beyond the US and Soviet borders, engulfing continents as far south as Africa, and as far east as East Asia. It divided the world into east and west blocs, and it involved sanctions, proxy wars, nuclear arms race, and espionage, but more than anything the Cold War was an ideological battle between communists who wanted to plan the economy and liberals who believed in free-market economy. Between 1945 and 1991, the Cold War was primarily identified as a security threat from the Soviet Union, but the real impact of the Cold War proved to be on one hand an economic one, and on the other hand the growth of Islamic terrorism. While the United States’ containment policy—the policy of preventing the spread of a hostile power using economic, diplomatic, and military strategies—proved effective in dampening communist aggression, the sanctions and isolation prevented global trade and slowed down the process of globalization and the exchange of culture and technology between the two blocs. On the other side, the Soviet war in Afghanistan and suppression of dissidents in the Third World led to the birth of Islamic terrorism. 

What if the Cold War had never happened?

It is hard to know how the world would have looked like had the hostile relations between the US and the Soviet Union never occurred. Without the communist threat the Marshall Plan might not have materialized and the post-war reconstruction of Europe and Japan might have taken far longer time than it did. The Cold War also played a decisive role in combating the imperialistic aspirations of Western Europe. Fearing that anti-colonialism sentiments in the Third World could play in the hands of the communist leaders, the U.S. pressured Western European countries such as France and England to abandon their pre-war colonial policies in developing countries. Algeria, Kenya, Vietnam, and other countries enjoyed sovereignty. Many years of divide-and-rule politics of the colonial powers had left the colonies in disarray and disunity. Recovery proved hard. Yet for the former colonies, decolonization meant a whole new prospect for future development. Not only saw the developing countries in the Cold War an opportunity to gain independence, but also the competition between the United States and the Soviet Union offered the now weakened Western Europe breathing room from internal rivalry. The old rivals, France, Germany, and England, needed to ally with the US to counter the communist threat. To foster peace in Europe, a scheme of economic cooperation was invented. Shortly after WWII Germany was included in the international framework for economic activity, and in 1958 Belgium, France, Italy, Luxembourg, the Netherlands, and West Germany founded the European Economic Community (EEC)—which became the predecessor to the European Union. Ironically, the Cold War had provided a platform for many positive outcomes. 

The conflict had its costs too. The Cold War led to the fastest and largest arms race ever. For the first time in the history of mankind, humanity could destroy itself many times over in a split second. It has been argued that a fraction of the resources used on military buildup during this period could have eradicated poverty or diseases such as, malaria, from the face of Earth. The Cold War also divided the world into the East and West blocs. The Berlin Wall became the most tangible symbol of this global divide, but the real upshot of this partitioning was its damning effect on international trade and on the exchange of culture and technology between the East and West for over four decades.

The growth of Islamic terrorism is also one of the adverse and unforeseen consequences of the Cold War. Islamism was born in the nineteenth century as a reaction to the British and French colonialism. Jamal ad-Din al-Afghani (1839-97), Hasan al-Banna (1906-49), and Sayyid Qutb (1906-66) were pan-Islamists and political activists, who believed that only a revival of politicized Islam could stop colonialism and the European influence in the Muslim world. The creation of Islamism had initially no reference to the Cold War, but it was the policies during this period that eventually led to an expansion of violent Islamism as an adversary international force. The CIA orchestrated coup in Iran in 1953 that overthrew the democratically elected government of Mossadegh was one such policy. The coup was at least partially a measure to contain Soviet influence in Iran. Mossadegh had just nationalized the Iranian oil resources, and he began playing the Soviet card to attract full American support for his cause. Mossadegh’s mistake was that he believed by approaching Moscow, Washington would have no choice but to listen to his demands. Instead, Washington moved to topple him from office. The coup, followed by President Johnson’s unconditional support for the oppressive regime of the Shah in the aftermath of Mossadegh’s fall, exasperated the Iranian people. Although the vast majority of the Iranian people would have never wanted to let the memories of the 1953 coup foster an antagonistic US-Iranian relationship, Khomeini masterfully played on the coup to foment hostility within a circle of powerful elite of his supporters and to justify violent attacks against the West.

In Afghanistan events took an ugly turn as a direct result of the Cold War rivalry between the two superpowers. In the 1980s, Washington supported the Islamist fighters financially and militarily following the Soviet invasion of Afghanistan, only to see them turning against the U.S. itself after the Soviet withdrawal. It is possible that this convoluted relationship between Washington and the Afghan Islamists would never have occurred had the Cold War not happened; hence much of today’s troubles with international terrorism could have been avoided. 

There were many other undesirable incidents that both followed and contributed to the Cold War rivalry between the two superpowers. The 1948 communist takeover of Czechoslovakia and the Soviet invasion of the country twenty years later; the Korean War in the beginning of 1950s; the 1956 Hungarian uprising; the Vietnam War in the 1960s and 70s; the Cuban missile crisis of 1962; and other perilous incidents became all part of the game of rivalry between those who wanted to plan the economy and those who believed in the free market.

In terms of physical violence the conflict was limited. Despite the two side’s massive nuclear firepower, the balance of power made the Cold War years a relatively peaceful period in human history. Other than local wars and ethnic skirmishes in parts of Africa, Middle East, and Asia, the international arena remained for the most part free of physical violence. But it is clear that with over four decades of division between the East and West the cost of the loss of global trade and collaboration must be one of the highest in human history. The impact of this cost was most burdensome for the Eastern bloc, as their economy collapsed entirely. By the time the Cold War ended the Eastern bloc was bankrupt. The Soviet state was in such dire financial condition that it was even struggling to fulfill its rental obligations for its embassies around the world. In Oslo the Norwegian government had to bail out the Russian Embassy. With great humiliation the last General Secretary of the Soviet Communist Party, Mikhael Gorbachev, toured around the world asking for money to help salvage his country from economic ruin. A country with billions of dollars of investment in some of the most advanced military technologies was on its knees for a few millions dollars of financial aid to feed its people. With the benefit of hindsight, it is safe to say that the communist legacy has been one of the saddest self-inflicted desolations of our modern time. Countries with a rich history and culture such as Poland and Czechoslovakia, and societies so technologically advanced such as the Soviet Union literally destroyed themselves in pursuit of a utopian world of planned economy and grassroots dictatorship. The imaginary world of the working class dictatorship was supposed to make every laborer the owner of his or her production. Instead it left him or her with next to nothing at all; not even a snatch of pride.

Towards the end of the Cold War, McDonald’s opened up its first restaurant in Moscow. The day it opened its door for hungry customers in 1990, tens, if not hundreds, of Russians queued up in a line stretching far outside the restaurant for an American style burger. Just as the Berlin Wall became emblematic of the iron curtain, the queue outside McDonald’s became the most visible symbol of the effect of deprivation in Soviet society; a deprivation caused by a destructive ideology that neither we in the West nor the Russian people cared for.

Without the Cold War globalization might have advanced far more. Perhaps by now we would have reached a higher degree of international collaboration to solve many of our common problems such as climate change. And Islamic terrorism might not have existed today had the Cold War not played out.

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