My new biography of Wallace, The World That Wasn’t, grounded in masses of new primary-source material, argues that this narrative is nonsense. I investigated the subsequent careers of the 1,176 delegates, and found that at most one of the delegates (New York’s Richard Patterson, whose vote is unrecorded) backed Truman and subsequently became an ambassador under him—ambassadorships having supposedly been the primary bribe currency. Moreover, Russian archival documents make clear that Stalin never considered Wallace more than a useful idiot who could aid his territorial ambitions in Europe and Asia.
Given the popularity of the counterfactual narrative, however, it is worth delving creatively into a pivotal episode of the early Cold War, and imagining how it might have played out if Wallace had been president instead of Truman.
On April 15, 1947, Truman’s secretary of state George C. Marshall met with Soviet leader Josef Stalin at the Kremlin to discuss the breakdown in U.S.-Soviet relations. The meeting was historically consequential, leading Marshall to conclude that Stalin was determined to stoke unrest and undermine recovery in Western Europe. The result was the creation of the Marshall Plan and NATO, both of which Wallace staunchly opposed.
What follows immediately below is a narrative of the meeting based on primary accounts, condensed from the longer narrative in my book The Marshall Plan, followed in turn by a counterfactual narrative of how the encounter with Stalin might have gone had a President Wallace represented the United States, instead of Secretary Marshall. It will then be left to the reader’s imagination how history might have played out from there.
Marshall and Stalin: April 15, 1947
On the night of April 15, 1947, accompanied by Ambassador Walter Bedell Smith and Chip Bohlen, who would act as translator, George Marshall made his way to the Kremlin through what appeared to Smith to be the most heavily policed street on earth. Ushered through a series of antechambers, the Americans arrived in a wood-paneled conference room where the Generalissimo, in his mustard-colored military uniform, stood waiting. Foreign Minister Vyacheslav Molotov, Ambassador to Washington Nikolai Novikov, and a translator were present. Portraits of Russian Napoleonic war heroes stared down from the walls.
It was 10PM. Stalin welcomed Marshall, complimenting him for having aged much better than he had. He, Stalin—at sixty-eight, two years older than Marshall—was now, in contrast, “just an old man.”
Bohlen agreed. He was surprised to see how the Soviet leader had aged. Five foot five, pock-faced, with a coarse, streaked mustache, yellowed teeth matching his eyes, his physical figure seemed to betray his legend.
George Marshall, never at ease with small talk, briefly returned Stalin’s pleasantries, recalling “with great interest” their previous meeting at the Tehran Conference in 1943, where “amphibious and cross-river operations” had been discussed.
“Yes,” Stalin interjected, “the second front.”
Marshall had wished to remind Stalin of the two countries’ recent historic collaboration, but the “second front” held different meanings for the two men. From Stalin’s perspective, it had been deliberately, devastatingly, and unforgivably late. America and Britain, he believed, delayed launching it for years in order that Germany and the Soviet Union might first grind each other into rubble and impotence. Stalin, of course, had also used this tactic—letting Germans slaughter the Warsaw Poles in August 1944.
Marshall steered the meeting toward business.
He would, he advised Stalin, speak frankly—not as a diplomat, but as he had been trained, as a soldier. He explained that he was “very concerned,” even “somewhat depressed at the extent and depth of misunderstandings and differences . . . revealed at this conference.” The Soviet Union, he said, had been held in high esteem among the American people at the end of the war. But since that time, the Soviet government had not kept faith with agreements and was hindering progress on new ones.
The American Lend-Lease arrangement with the Soviet Union, Marshall reminded Stalin, “had been the most generous of all,” and the unwillingness of the Soviets to settle their obligations—such as the return of merchant ships and war vessels—was having “a very bad effect on the United States Congress and on public opinion.” Now, here in Moscow, an atmosphere of “suspicion and distrust [was making] agreement virtually impossible.”
Marshall was indeed speaking frankly; even brutally, as he later termed it.
Impassive, Stalin puffed a cigarette; looking down, to the side, occasionally into Marshall’s eyes as he listened to the American and his translator. A red pen in his right hand throughout, he doodled wolves’ heads on a notepad, in plain sight of his guests—a practice he was known to have cultivated some time ago for the purpose of disconcerting them. Harriman had experienced it in his first audience with him at the beginning of the war.
Marshall turned to the main issue dividing Washington and Moscow: Germany. They were not making progress on any of the central matters: demilitarization, reparations, or the country’s future economic and political architecture.
Germany had brought the Soviet Union and the United States together in a common cause, from 1941 to 1945, but now that it was caged between the eastern and western halves of the continent, each under the effective control of their respective militaries, it served only to magnify the consequences of their clashing ideologies and geostrategic interests. Little of substance, or even of clear meaning, regarding Germany’s future had been decided among FDR, Churchill, and Stalin at Yalta two years prior, in spite—or because—of it being by far the most consequential issue the three governments would have to resolve. Stalin had at the time been content to wait; he expected “the correlation of forces” to move in his favor, as they did when the Red Army beat General Eisenhower to Berlin.
Now, here in Moscow, Marshall said, there was a misconception that the United States “intended to dismember Germany.” But his government “did not have any such intention”; it “in fact desired the opposite.” It wanted the country unified economically, allowing the more industrial west to exchange goods freely with the agricultural east. But it also believed that a powerful central German government “would constitute a real danger for the peace of the world.” Marshall further believed, yet did not say, that the main source of this danger was the Kremlin-controlled KPD (Kommunistische Partei Deutschlands) German Communist Party, which had held power in the east since forcibly absorbing and dismantling the SPD Social Democratic Party in 1946.
Marshall now directed his frustration at his interlocutor for the past six weeks. “Mr. Molotov,” he said, “had charged that the British-American bi-zonal arrangement was in violation of Potsdam.” But it “was as plain as this table that the United States and Great Britain had been forced to take this action”—merging the two zones—"in defense of their own taxpayers, by reason of the failure to establish economic unity in Germany.”
As for reparations, Marshall continued, Molotov was exaggerating what the United States had received from the American zone, while refusing himself even to provide any figures as to what the Soviet Union had received. The two delegations had, further, reached “an impasse on the demilitarization treaty.”
There was also the wider context, Marshall added: Europe. “We are,” he said, “frankly determined to do what we can to assist those countries which are suffering from economic deterioration.” If “unchecked, [this] might lead to economic collapse and the consequent elimination of any chance of democratic survival.”
Trying to close on a positive note, Marshall reiterated his “desire to rebuild the basis of cooperation that had existed during the war.” He had, he said, “come to Generalissimo Stalin with that hope, feeling that if they cleared away some of the suspicion it would be a good beginning for the restoration of that understanding.”
Stalin nodded. Marshall, he said, was “quite right, that only on the basis of frankness and sincerity could cooperation and friendship be developed.”
“As to lend lease,” he confessed, “there was occasional sloppiness in the operation of the Soviet Government.” It was “very busy here because [we] suffered such great losses in the war. . . . This might be the reason for the delays.” But “there was another side to the lend lease question,” he told Marshall: “namely the credits which had been linked to lend lease.”
Two years ago, Stalin explained, in response to Ambassador Harriman’s question regarding what orders the Soviet government was prepared to place in the United States, and what credits it needed to settle them, his government had submitted a memorandum requesting three to six billion dollars. Six billion, Stalin said, had been “long promised.” Now, after two years had passed, “no reply [had yet] been received.” This was, he suggested pointedly, “possibly due to sloppiness on the part of the United States.”
Novikov was stunned. Six billion? “I only knew of a promise of a one billion dollar loan,” he later recorded. And “I was not the only one struck by Stalin’s bitter reproach.” Marshall was whispering in Smith’s ear as Stalin spoke; Smith scribbled furiously. He reached across the table and handed Novikov a note.
“Mr. Novikov!” it read, “you know too well that it’s not so. Six billion have never been promised. Please, explain it to Mr. Stalin.” Novikov translated and handed the message to Molotov. “Without moving a brow,” Molotov “put the sheet into a folder.” He “did not say a word” to Stalin, whose “strange memory lapse . . . haunted me,” Novikov noted. “[W]hat I saw was an elderly, very elderly, tired man, who, likely, was carrying his great burden of responsibility with great difficulty.” Stalin would correct himself, but only to the extent of conceding that “one year” had passed rather than two.
Stalin moved on to Germany. “The [Council of Foreign Ministers],” he said, “had no authorization to repeal . . . the agreements entered into by the three governments.” He looked at Bohlen.
“Mr. Bohlen must remember those conversations” at Yalta, where he translated for FDR, when “all the Americans, including President Roosevelt, [Secretary of State Edward] Stettinius and [Harry] Hopkins had said they thought [the Soviet demand for $10 billion in reparations] was very small.” And spread “over twenty years this would not be hard for the Germans.” But “now there was apparently a different point of view,” that despite the Soviet Union having removed “barely two billion dollars” worth of assets no more reparations would be permitted—not even from current production. “This the Soviet Union could not accept.” The Soviet people, Stalin said, had suffered terribly at the hands of the Germans. He had “no pity, sympathy, or love for them.” Reparations were right and necessary.
As for “the subject of German unity,” the Soviet Union “stood like the British and Americans for economic unity.” But that was not enough, Stalin said; economic unity was not “feasible without political unity.”
“[We] are against a strong centralized German government,” Stalin clarified; we want only one that “should stand above and not below the Länder [state] governments.” But “[we] must not repeat the same mistakes as Napoleon, who set up scattered German governments.” He thereby gained “a tactical advantage from a temporarily weakened Germany,” but strengthened the hand of “German militarists” who dreamed of reuniting Germany. “Napoleon’s action in effect gave birth to Bismarck and the Franco-Prussian war.”
If these errors were now repeated, the Soviet Union risked “losing control of the instrument of German unity and handing it over to the militarists and chauvinists.” The German people would then soon follow another dangerous and bellicose leader down the path of reconsolidation.
§
However incoherent its elements, the contours of Soviet policy toward Germany had been largely settled for a year now. Stalin had no inclination to reopen it.
In May 1946, thirty-eight top Soviet officials, including General Georgy Zhukov and Deputy Foreign Minister Solomon Lozovsky, had submitted their conclusions on Secretary of State James Byrnes’ proposal for German demilitarization and great-power security guarantees in Europe. They were unequivocal: Moscow must reject it. The United States, they argued, was trying to drive the Soviet Union out of Germany to secure its “economic domination of that country” and “to preserve [its] military potential [in Europe] as a necessary base for carrying out their aggressive aims in the future.” Stalin concluded that Washington was reneging on Roosevelt’s Tehran commitment to withdraw U.S. troops within two years of the war’s end, seeking instead Soviet “sanction for the U.S. playing the same role in European affairs as the U.S.S.R.” And once Soviet troops were out of Germany, Zhukov warned, the Americans would “demand a withdrawal . . . from Poland”—a critical military corridor with Germany—“and ultimately from the Balkans.” Within a few years, there will be “a German-Anglo-American war against the USSR.”
In this light, Marshall’s calls to rebuild Germany and to end reparations were two sides of the same coin. America intended to take over Germany, rearm it, and turn it against Russia. Marshall might as well have been pushing on a closed door from the inside; Stalin would oppose any plan that precluded Soviet control over the western half of Germany. “All of Germany must be ours,” Stalin told Bulgarian and Yugoslav leaders in 1946. “That is, Soviet, Communist.” Stalin kept talking to Marshall only because he wanted Washington “to shoulder the responsibility for Germany’s division,” if such could not be avoided.
As for Washington’s policy on Germany, it had lurched radically since 1945. The Truman administration was now in revolt against the mind-set that had held sway, however tenuously, in Washington a mere two and a half years prior, which viewed a united, industrially revived Germany as a continued threat to Europe. FDR’s State Department never supported Treasury Secretary Henry Morgenthau’s plan for deindustrialization and dismembership, believing it “would provide a ready-made program for nationalistic agitators”; instead it supported only decentralization, or federalization, as a means of containing German nationalism and militarism. Once Truman became president, he condemned Morgenthau’s “meddling” and put the State Department back in control of foreign policy.
Europe’s economic crisis now made Morgenthau’s ideas for German pastoralization look reckless. Real gross domestic product (GDP) in Britain was tumbling (down 2.6 percent for the year), while inflation in the United States was soaring (14.4 percent for the year), pushing up British import costs. “Production,” concluded a widely circulated report by former president Herbert Hoover, following a European trip in February, was “the one path to recovery in Europe.” And “the whole economy of Europe,” he insisted, “is interlinked with the German economy.” His ally Senator Vandenberg called Germany “the core of the whole European problem.”
Despite the massive wartime damage Germany sustained, reflected in the destruction of 40 percent of its housing stock, a remarkable 80 percent of the country’s industrial plant capacity remained intact. Germany exited the war with a greater functioning machine tool stock than it had on entering it—much of it new (one third of industrial equipment was less than five years old, up from one tenth in 1939). Only raw material shortages and political uncertainty held back its recovery—and Europe’s. The United States could, therefore, Hoover concluded, “keep Germany in these economic chains, but it will also keep Europe in rags.”
U.S. military governor in Germany General Lucius Clay and John Foster Dulles, foreign policy adviser to Republican presidential hopeful Thomas Dewey, agreed with Hoover, although the two disagreed bitterly over how to manage Germany. Clay, who considered Dulles overly indulgent of the French, wanted to maintain the territorial integrity of the country and avoid rupture with the Soviets; Dulles wanted to put the Ruhr under international control and use the resources of the Rhine basin to jump-start a new federated “western Europe.” This idea was beginning to capture the imagination of a State Department in search of ways to give substance to the Truman Doctrine. For his part, Stalin naturally opposed German reindustrialization, particularly when its object was to bolster European capitalism.
§
Six weeks of talks in Moscow had not even begun to close the gap between Soviet and American visions for Germany. Yet Stalin had one final proposal.
“If our views on this subject cannot be reconciled,” he put to Marshall, “there was a way out,” a compromise. “Let the German people decide through a plebiscite what they wished.”
Marshall recoiled. He knew full well where a “plebiscite” would lead. He had seen the results in Poland, last July, in a baldly manipulated referendum that cleared the way for Communist control. General elections followed in January 1947, in the run-up to which anti-Communist Peasant Party supporters were arrested by the thousands and their candidates stricken from electoral lists. Yet in order to prevail, the Communists still had to resort to mass ballot stuffing. Churchill had fought a lonely last-ditch diplomatic offensive against Stalin at Yalta to preserve an independent Poland as a barricade against Soviet westward expansion. But FDR, more concerned with securing Soviet UN membership and entry into the Pacific war, capitulated to Stalin’s insistence on Allied recognition of the Soviet-backed provisional Polish government and toothless Western monitoring of future elections. Now, in Moscow, Marshall was determined to defend another such barricade a few hundred miles to the west, in Germany.
All Marshall and Stalin could agree on was that neither the United States nor the Soviet Union could risk the possibility of Germany becoming an ally of the other. “We must insist on keeping Western Germany free of communistic control,” Kennan would later urge. Marshall would call “domination of all Germany by [the] Soviets . . . the greatest threat to the security of all Western Nations.”
Thus, after ninety minutes of serial monologue, the two men resolved nothing. Marshall was grim. Yet Stalin remained disconcertingly calm, almost detached.
“It is wrong to give so tragic an interpretation to our present disagreements,” he told Marshall. They were, he said, like quarrels between family members. Differences over Germany were, he added, pointedly replacing the familial analogy with a martial one, “only the first skirmishes and brushes of reconnaissance forces.”
Agreement might come in time, he assured Marshall. “When people had exhausted themselves in dispute,” Stalin said, “they recognized the necessity for compromise. We may agree the next time,” he added encouragingly. “Or, if not then, the time after that.” His manner suggested what researchers would later identify as signs of hostile diplomatic intent. Unwarranted “positive sentiment” and a “focus on future” possibilities, as opposed to present circumstances, suggest imminent betrayal.
Marshall was now alarmed—not that Stalin continued to disagree with the American position, but that he was content to let disagreement drag on while Germany and Europe convulsed. “The worse, the better”—a phrase famously attributed to the nineteenth-century radical Russian writer Nikolai Chernyshevsky, and later to Lenin—appeared to be the Soviet leader’s view. Marshall now saw that Molotov’s mulishness could not be explained away by his character. The foreign minister had been carrying out his boss’s orders. The Soviets, Marshall concluded, were “not negotiating in good faith.” They “were doing everything possible to achieve a complete breakdown in Europe.”
“It was the Moscow Conference,” said Ambassador Robert Murphy, General Clay’s political adviser and the top U.S. diplomat in Germany, “which really rang down the Iron Curtain.” Skeptical of prospects for cooperation with the Soviets before the conference, Murphy would thereafter see them as wholly untrustworthy and decry anything resembling American appeasement.
“President Wallace” and Stalin, counterfactual: April 15, 1947
President Wallace, under enormous pressure in Washington to halt and reverse Soviet expansion in Europe and Asia, led off the discussion.
“The Generalissimo must know,” Wallace said, “that fascist voices are growing louder in America. They have been called ‘Cold Warriors,’ but some of them want hot war. They say that Soviet peacekeepers in northern Iran and the Turkish straits are an offensive force. That you are set on world domination. That I should have sent battleships and air support. That I should have confronted the Soviet Union in the United Nations. These are lies and provocations, of course. But Americans need your reassurance.”
Stalin lit a cigarette. “The Soviet Union suffered far worse than any nation in the last war. That is why I, like you, am trying to keep the peace. It is only the imperialists and warmongers who will not see this.”
“I agree, of course,” Wallace said. “But the American people need clearer signals of your nation’s peaceful intentions. Otherwise, too many are inclined to see the worst. They think our two systems cannot coexist. Together, we must show them this is not so.”
Stalin nodded. “We can show them in Germany. This means keeping to what was agreed at Yalta and Potsdam. For the Soviet people, ten billions in reparations is the least they can accept. They cannot understand when they hear that the American military in Germany is not meeting the solemn commitments made by President Roosevelt and President Wallace.”
“As I have said, and Marshal Stalin knows well, the Morgenthau Plan remains the basis of American policy in Germany. Germany must become a peaceable agricultural nation. The Ruhr Valley must be placed under international control. Its industry, the foundation of the Nazi aggression, must be put to the use of its victims.”
“Does your General Clay in Berlin understand this?,” Stalin asked.
“The general understands and is committed to the policy of his government. It is necessary, though, that our people see that it is Germany paying reparations, and not the United States. Right now, it is our resources keeping German workers, German women and children, alive. General Sokolovsky, understandably, says he does not have the food resources in the east to meet the Soviet Union’s reciprocal obligations to the west. We therefore need to work together so that the Soviet and western zones can be unified economically.”
“And politically,” Stalin interrupted. “Otherwise, the German people will follow new demagogues into unification and war. This is why we need a referendum in the country.”
“I will support a referendum,” Wallace said. “But our two governments must be clear and open about what question will be put before the German people, and how the vote will be carried out. The American people believe the Polish vote was not entirely free and fair. They appreciate and respect that the Soviet people want—they expect—good neighbors, friendly neighbors, but believe that Soviet-German relations must be transformed in a transparent fashion such that there can be no question as to the legitimacy of the exercise.”
“The Soviet people are unified,” Stalin said, “and they want the same unity among peace-loving anti-fascists across Germany. It is the only basis for future friendship between the Soviet and German peoples.”
“I believe this,” Wallace assured him. “My government is concerned, though, that if business enterprises in eastern Germany continue to be transformed into Soviet corporations it will not be possible for German anti-fascists to choose freely the economic organization of their society. We believe that progressive capitalism and socialism can co-exist harmoniously, just as capitalist and communist parties work in coalition in the Czechoslovak government.”
“It is a model for a unified Germany,” Stalin agreed, “and for cooperation between our two countries. There are no longer American or Soviet forces in Czechoslovakia. It can be done.”
“Then we agree. I will ask Secretary of State Duggan to continue these discussions with Mr. Molotov. We must show the world that the United States and the Soviet Union can resolve their differences with goodwill and dialogue. This is why I am working for the immediate abolition of atomic weapons, and complete civilian control of our atomic energy resources in the service of universal abundance. Why I am working for $50 billion in U.S. funding for a United Nations Reconstruction Fund, to aid the victims of fascist aggression—first and foremost in the Soviet Union. And why I urge the Generalissimo to join me in signing a ‘peace pledge’ before my departure from Moscow. Nothing is more important than peace between our two great nations.”
Stalin nodded. “Peace is possible, yes. And desirable, of course. But let us not put the cart before the horse. The Soviet people will not understand words of peace without actions of peace. Elimination of your atomic bombs, of course, and your air bases abroad. $10 billion from Germany, and at least as much from the United Nations, for the rebuilding of our industry. And unification of Germany under true anti-fascists. So we will keep talking, then, until we find words to dignify deeds.”
With some effort, Wallace smiled.
Peace would come, he was sure; the Common Man would not abide less. Still, it was not easy to overcome the legacy of Bolshevik mistrust; imperialists in London and Washington had much to atone for. He would need to do everything in his power to tamp down reactionary calls for a new Western military alliance and the division of Germany.
Benn Steil is senior fellow and director of international economics at the Council on Foreign Relations and the author, most recently, of The World That Wasn’t: Henry Wallace and the Fate of the American Century.
