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AP European History
Western Europe After WW II
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Bretton Woods Conference (1944): created International Monetary Fund (IMF)
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Lay foundations for modern monetary system; based on U.S. dollar
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IMF (World Bank) designed to loan money to struggling countries to prevent economic crises
and anarchy; instrumental in post-war economic boom.
United Nations created in 1945: Security Council (12 nations including 5 permanent members
had powers to act; General Assembly had powers to advise (included all nations of the world)
Western Europe political recovery
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Economic hardship after WWII: scarcity of food, runaway inflation, black markets
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Many people believed Europe was finished.
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Suffering was worst in Germany
Political restructuring
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Christian Democrats inspired by common Christian and European heritage.
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Rejected authoritarianism & narrow nationalism; had faith in democracy and cooperation.
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Catholic parties also progressive in nature
Socialists and Communists also emerged with increased power and prestige, especially in
France and Italy.
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Result: social reform and political transformation created foundations for a great European
renaissance.
Italy: Christian Democrats gained control in 1946 led by Alcide De Gasperi
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Pushed for social change and economic reform with considerable success.
Socialist influence: social benefits came to equal a large part of the average worker’s wages
France:
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General Charles De Gaulle, inspiring wartime leader of Free French, re-established free and
democratic Fourth Republic (resigned in 1949)
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Catholic party provided some of best postwar leaders e.g. Robert Schuman
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Socialist influence: large banks, insurance companies, public utilities, coal mines, and the
Renault auto company were nationalized by gov’t.
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Britain followed same trend
Federal Republic of Germany (West Germany):
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1949, Konrad Adenauer began long, highly successful democratic rule.
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Christian Democrats became West Germany’s majority party for a generation
Great Britain:
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Clement Attlee, socialist Labour party leader, defeated Winston Churchill and the
Conservatives in 1945.
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Attlee moved toward establishment of a “welfare state.”
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Many industries nationalized, gov’t provided each citizen with free medical service and taxed
the middle and upper classes more heavily.
“Economic Miracle”: unprecedented economic growth in European history
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Europe entered period of rapid economic progress lasting into late 1960s.
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By 1963, western Europe produced more than 2.5X more than before the war.
Causes:
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Marshall Plan aid helped western Europe begin recovery in 1947
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Korean War in 1950 stimulated economic activity.
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Economic growth became a basic objective of all western European governments.
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Governments accepted Keynesian economics to stimulate their economies.
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Germany and France were especially successful and influential.
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In most countries many people willing to work hard for low wages; expanding industries
benefited.
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Increased demand for consumer goods.
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Many economic barriers eliminated and a large unified market emerged: Common Market.
German economic recovery led by finance minister Ludwig Erhard
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Combined free-market economy & extensive social welfare network inherited from Nazi era.
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By late 1950s, West Germany had robust economy, full employment, a strong currency and
stable prices.
France
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Combined flexible planning and a “mixed” state and private economy to achieve most rapid
economic development in its history.
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Jean Monnet: economic pragmatist and architect of European unity.
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France used Marshall Plan aid money and the nationalized banks to funnel money into key
industries, several of which were state owned.
European Unity
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Council of Europe created in 1948
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European federalists hoped Council would quickly evolve into a true European parliament with
sovereign rights, but this did not happen.
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Britain, with its empire and its “special relationship” with U.S., opposed giving any real
political power—sovereignty—to the council.
Schuman Plan, 1950 created the European Coal and Steel Community
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Put forth by French statesman Jean Monnet and Foreign Minister Robert Schuman.
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Special international organization to control & integrate European steel and coal production.
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West Germany, Italy, Belgium, Netherlands, & Luxembourg accepted in 1952.
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Britain refused to enter
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Immediate economic goal: a single competitive market w/o national tariffs or quotas.
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"The Six": By 1958 coal and steel moved freely among six nations of the European Coal and
Steel Community
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Far-reaching political goal: bind six member nations so closely together economically that war
among them would become unthinkable and virtually impossible.
European Economic Community (EEC)
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Treaty of Rome, 1957
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Created European Economic Community (EEC) or the Common Market
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Signed by same six nations in the Schuman Plan – “the Six”
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First goal of treaty: Gradual reduction of all tariffs among the Six in order to create a single
market almost as large as the U.S.
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Other goals:
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Free movement of capital and labor.
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Common economic policies and institutions.
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Tariffs were rapidly reduced and regions specialized in what they did best.
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EEC encouraged hopes of political and economic union.
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Union frustrated in 1960s by resurgence of more traditional nationalism.
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Euratom (European Atomic Energy Agency) also created by agency.
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Communist states responded by forming their own economic association--COMECON
France steps back from European unity
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Bitter colonial war in Algeria resulted in the election in 1958 of General De Gaulle who
established the Fifth French Republic and ruled as president until 1969.
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Withdrew France from "US controlled" NATO and developed own nuclear weapons program.
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De Gaulle twice vetoed application of pro-American British to European Union.
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Britain did not inter until 1973.