Chapter 29 Economic Recovery

Economic Growth Postwar Europe provided economic opportunities New Technologies Atomic Power, Jet Engine, Television, Frozen Foods Rebuilding Rebuilt factories and transportation networks adopted most efficient methods and newest machinery

Economic Growth Labor Displacement of millions led to increased amounts of available skilled labor Birthrates Baby boom helped replace losses of war, grow domestic markets

Economic Growth Stimulus from U.S.S.R Soviet Union provided a market and economic stimulus for countries of the Communist Bloc Eastern European Nations organized economies of the Soviet model -Five-Year plans, collectivization of farms

Economic Growth Stimulus from U.S.A. $4.4 billion in long term credit to Great Britain $1.2 billion in long term credit to France Marshall Plan $15 billion to Europe Administered by the Organization for European Economic Cooperation (OEEC) - 8 nations European Payments Union Regulated currency exchanges

Economic Growth OEEC nations GNP increased 25% annually from By 1952 it was half again the 1938 level Per capita income was 33% higher “Economic Miracle”

The Economic Role of the State Increased role of the government in the economy Britain and France nationalized heavy industry, banks Italy inherited conglomerates of the Fascist system West German government helped coordinate economic growth Monnet Plan nonpolitical “technocrats” to run the economy

The Economic Role of the State Creation of the “welfare state” Assumed medical, dental and hospital care for every citizen Universal Health Care Housing programs Social Services To pay for these programs, governments increased taxes

The Soviet Union Stalin died of a stroke in Question of succession After 4 years of collective leadership, Nikita Khrushchev became the dominant figure Khrushchev attacked the “cult of personality” of Stalin -Attacked his excesses, paranoia, purge trails of 1930’s, interference in the war

Soviet Bloc Resentment of the USSR’s exploitation became more public after death of Stalin Workers of East Berlin began a General Strike -Protesting increased quotas Russian tanks put down the revolt Walter Ulbricht became new leader of East Germany Began program of better wages, living conditions Expanded trade with West Germany Strengthened dictatorship

Soviet Bloc Workers protest in Poland, 1956 Soviet forces intervened Wlayslaw Gomulka elected by Communist party in preference to pro-Soviet candidate Negotiated reparations from Germany Received aid from U.S. Mitigated repression of Catholic Church, intellectuals

Berlin Wall Eastern Germany built a wall across the center of Berlin Extended along East Germany’s entire Western border

Soviet Bloc Anti Russian uprisings in Hungary, 1956 Soviet troops withdrew from Budapest Imre Nagy, who had been arrested as a “right-wing” leader became premier Replaced alliance with Russia with policy of neutrality Soviet leadership sent army to crush rebellion, Nagy executed

Toward European Union OEEC – handled money of the Marshall Plan European Coal and Steel Community (ECSC)- administered coal and steel resources of member states -Treaty of Rome (1957) established the European Economic Community (EEC) also called the Common Market, which lifted trade restrictions among member states European Single Act (1986) free movement of labor, capital, and services such as banking and insurance

Toward European Union Maastricht Treaty (1992) led to creation of common currency, the Euro Went into circulation in 2002 (exception of Denmark, Sweden, U.K.) Cooperation in defense, justice and environmental affair EEC renamed the European Union (EU)

Expansion of EU