The money was given on the condition that it be spent in the USA and also to a lesser extent, in
Canada. For manufactured good, equipment’s and agricultural products. Domestic/ political angle to this
plan as well as it represented a huge govt/ subsidy to the business sector.
The USSR made their copy-cat version of this known as the COMECON.
Division of labour had the effect of breeding investment. Romania the “vegetable garden” of Eastern
Some countries now had imp. Industrial niches etc.
Involved the creation of military alliances and US took the lead in the late 1940s of having a series of
regional defense alliances, the most imp. Of which was NATO set up in 1949. It had 12 original member
USA, Canada, Britain, France, Italy, Portugal, Holland, Belgium, Luxemburg, Norway, Denmark, Iceland
Later, Turkey was also added.
From it’s basis, NATO deployed conventional and nuclear forces armed at the SU.
USSR involved by tightening grip on Eastern Europe by a troop build up and in 1955, they had their own
version of NATO which came to be known as the Warsaw Pact.
This would work to the advantage of North Korea.
Korea jointly occupied by USA and USSR.
North of the 38th parallel – USSR and south was occupied by the USA.
This partition of Korea was part of the Yalta agreement aimed at securing Soviet participation against
Japan and the partition supposed to be temporary.
Kim il Sung spent much of WW2 in SU.
The miracles of chairman Mao
American’s installed Syngman Rhee.
In 1949, US and USSR decided to withdraw forces from the Korean peninsula. The problem was that
both Syngman Rhee and Kim Il Sung wanted to unite the peninsula, by force if necessary. This lead to
the invasion of South Korea by the North.
Truman chose to view the North Korean invasion in global terms and he believed that the North Korean
attack was masterminded by Moscow and that this was the opening shot or the first stage of Moscow’s
conspiracy to advance communism in Asia.