OX F O R D S T U D I E S I N

M O D E R N E U RO P E A N H I S TO RY
General Editors: SIMON DIXON, MARK MAZOWER,
and
JAMES RETALLACK
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 After Empires
European Integration, Decolonization, and
the Challenge from
the Global South 1957–1986

G I U L I A N O G A R AV I N I

Translated by Richard R. Nybakken

1
 3
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Originally published in 2009 as Dopo gli imperi. L’integrazione europea
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 Contents

List of Figure and Tables vii

Chronology viii

Introduction 1

1. The Third World and the Creation of UNCTAD 7

The spirit of Bandung 8
Recipes for development 19
Unionizing the Third World: The G77 and the origins of UNCTAD 30

2. The Myopia of the European Community 45

The passing of Imperial illusions 46
The wonder of modernity: In defense of the Common Market 59
The Algiers Charter 69
A Common Market without a common identity 78

3. 1968: Empires and Shopping Malls 90

The limits of Americanization 92
Thirdworldism and social rebellion 98
Losing one’s religion 110
The closing circle 115

4. The Developing Countries’ “Most Favored” Partner 122

The Atlantic widens 123
Santiago, Chile: the radicalization of the Third World 132
Sicco Mansholt 141
Regionalists and globalists 152
5. The Year of Oil 162
The oil weapon 163
The New international economic order 174
Europe’s identity 183
The successes and failures of the Community’s global policy 190

6. North–South Dialogues 201

G5, G6, G7 203
The North–South dialogue in Paris 215
Willy Brandt and global social democracy 230
vi Contents

Epilogue: Managing Globalization 241

Third Worlds 242
The European Single Market project 249

Bibliography 262
Index 287
 Figures and Tables

Figures
1.1. The Non-Aligned Movement (1961–1976) 14
1.2. The G77 from its Origins to 1976 37
1.3. The European Community and its Agreements with
Developing Countries (1957–1977) 153

Tables
4.1. Trends in World Trade 154, 155
5.1. Energy Use in Selected Western European Countries (1937–1985) 164, 165
 Chronology
1955 April Twenty-nine African and Asiatic nations meet in Bandung
1960 October Birth of OPEC
1961 September First conference of the Non-Aligned countries in Belgrade
1962 Economic conference of the Non-Aligned countries in Cairo
1963 Signature of the Yaoundé Association
1964 March First UNCTAD conference in Geneva and institutionalization of the
G77
1965 Failure of the “Second Bandung”
1966 January Tricontinental conference in Havana
1967 June GATT’s “Kennedy Round” without concessions to LDCs
October The G77 approves the “Algiers Charter”
1968 February Second UNCTAD conference in New Delhi
1970 September Third meeting of the Non-Aligned countries
1971 The EC approves its Generalized System of Preferences scheme
1972 April Third UNCTAD conference in Santiago, Chile
October European Summit in Paris: EC leaders approve a global cooperation
and development policy
1973 September Fourth meeting of the Non-Aligned countries in Algiers
October Arab oil producers (OAPEC) approve embargo and production cuts
December OPEC decided new posted price for oil
1974 April Sixth UN General Assembly (adoption of declaration on the NIEO)
December UN adopts the Charter of Economic Rights and Duties of States
1975 February Lomé Convention between EC and forty-six ACP countries
April Failure of consumer–producer meeting in Paris
November First meeting of the six most industrialized countries in Rambouillet
December Beginning of the Conference for International Economic Coopera-
tion (CIEC, North–South dialogue)
1976 May Fourth UNCTAD conference in Nairobi
June G7 Summit in Puerto Rico
1977 May Conclusion of the North–South dialogue in Paris
September Launching of the Brandt commission
1978 July G7 in Bonn and application of “locomotive theory”
1979 May Fifth UNCTAD conference in Manila
 Chronology ix
September Conference of the Non-Aligned Movement in Havana
1980 February The Brandt Commission report is published
1981 October North–South meeting in Cancun ends phase of global talks
1986 February Signature of the Single European Act establishing a Single Market
Oil price collapse: “oil countershock”
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 Introduction

Alexis de Tocqueville, that noble and liberal Frenchman of inexhaustible curiosity

who had studied the rise of American democracy and the energy of its people with
great insight—and not without fear—rediscovered his faith in Europeans around
1840, when they demonstrated themselves capable of crushing Chinese resistance
during the first Opium War:
So at last the mobility of Europe has come to grips with Chinese immobility! It is a
great event, especially if one thinks that it is only the continuation, the last in a mul-
titude of events of the same nature all of which are pushing the European race out of
its home and are successively submitting all the other races to its empire or its influ-
ence. Something more vast, more extraordinary than the establishment of the Roman
Empire is growing out of our times, without anyone noticing it; it is the enslavement
of four parts of the world by the fifth. Therefore, let us not slander our century and
ourselves too much; the men are small, but the events are great.1
After decades of such “submission,” an epochal change brought the countries of
Africa and Asia their political independence; the Great Divide that once separated
the “enslaved” peoples from their imperial masters has been challenged and in
many places overcome. Today the results of the process that goes by the controver-
sial name “decolonization” are visible to even the most casual observer of the con-
temporary world. In 2006 an Indian company, Mittal Steel, acquired Luxembourg’s
most important industrial concern, Arcelor, giving birth to the largest steel con-
glomerate in the world. This was an event of clear symbolic significance, if one
recalls that the steel industry was considered of such strategic importance to west-
ern Europe after the Second World War that in 1951 it was at the very heart of the
continent’s first efforts at integration: The European Coal and Steel Community
(ECSC). At the dawn of the third millennium, the summit of the leaders of the
seven most important economies—the G7, four members of which were Euro-
pean—has been overtaken in importance by the G20, which includes regional and
emerging global powers, thus leading to speculation that the “West” has been
matched and could possibly be surpassed by the “Rest.”
This book is not a history of the European continent from the Atlantic to the
Urals, nor can it be taken as a complete account of the main political, economic,
and cultural events in western Europe during the years under consideration. Rather,

1
Alexis de Tocqueville to Henry Reeve, April 12, 1840, in Roger Boesche, ed., Alexis de Tocqueville:
Selected Letters on Politics and Society, trans. James Toupin (Berkeley: University of California Press,
1985), pp. 141–2.
2 After Empires

it is a history of the postwar process of western European integration that focuses

on the retreat from empire, the alternative order established by decolonization, and
the cultural, political, and economic challenges faced by empires first and nations
later. Europe’s identity has been inextricably linked to its rule over the rest of the
world, and this was no less true during the Cold War era than it had been a century
earlier.2 This suggestion, regrettably in large part disregarded until only very re-
cently, was imparted by Geoffrey Barraclough to students and historians of current
affairs at the height of the struggles for African and Asian independence:
Between 1945 and 1960 no less than forty countries with a population of 800 mil-
lions–more than a quarter of the world’s inhabitants–revolted against colonialism and
won their independence. Never before in the whole of human history had so revolu-
tionary a reversal occurred with such rapidity. The change in the position of the peo-
ples of Asia and Africa and in their relations with Europe was the surest sign of the
advent of a new era, and when the history of the first half of the twentieth century—
which, for most historians, is still dominated by European wars and European prob-
lems, by Fascism and National Socialism, and by Mussolini, Hitler and Stalin—comes
to be written in a longer perspective, there is little doubt that no single theme will
prove to be of greater importance than the revolt against the west.3
Predictions of the crisis of Eurocentrism were already in the air during the Belle
Époque, of course, and were later discussed with even greater urgency after the First
World War, when they led to ominous treatises on the inexorable decline of
Western civilization. Most thought, however, that the peril would come from the
Anglo-Saxon nations—those whom the Italian historian Emilio Gentile has called
the europeidi, the “children of Europe”—or from an Eurasian power like Russia.
Asia itself did not yet disturb the sleep of a continent “whose power in arms and
wealth allowed it to keep such ghosts at bay, so as not to disturb its faith in progress
and the hope of new conquests and new triumphs.”4
But by the early 1960s the emergence of the “darker nations” could no longer be
ignored as, one after another, African and Asian nations obtained their independ-
ence and Latin American countries resumed their battle for political and economic
emancipation. Following closely on the heels of political experiments such as the
Non-Aligned Movement, the creation in 1964 of the United Nations Conference
for Trade and Development (UNCTAD) confirmed the arrival of the Global
South—or Third World, as it was called at the time—on the international stage,
and embodied their quest for political and economic cooperation.5 Through
UNCTAD, for the first time the developing nations were able to harness the power

2
On the links between Europe and the rest of the world in the long eighteenth century, see C.A
Bayly, The Birth of the Modern World 1780–1914: Global Connections and Comparisons (Malden:
Blackwell Publishing, 2004).
3
G. Barraclough, An Introduction to Contemporary History (London: C.A. Watts, 1964), p. 164.
4
E. Gentile, L’apocalisse della modernità. La Grande Guerra per l’uomo nuovo (Milan: Mondadori,
2008), p. 81.
5
I use the terms Third World and Global South interchangeably, although the latter has a more
nuanced meaning than the former. While the origins of the name “Third World” are well known—it
was used for the first time in 1954 to distinguish this from the industrialized capitalist and Commu-
nist worlds—the “Global South” is still used today to refer to those countries and social movements
that in one way or another are either opposed to, or are struggling to be more involved in, oversight
of the globalization of the international economy.
 Introduction 3

of collective action in order to push for a reform of the rules of the international
economy and of international law, selecting as the primary target first the former
colonial empires and later “imperialism.”
While it was not always successful in achieving its goals, the Global South should
not be seen merely as a collection of desperate, starving peoples, its leaders awaiting
salvation from the coffers of the industrialized world or its charitable organizations—
the stuff of the straw man manipulated by international communism.6 Nor should it
be dismissed, as often occurs even in the best critiques of decolonization, as the passive
victim of a process that simply transferred control of empires from European into
American hands, or that gave birth to a new form of neocolonialism exercised through
free trade and indirect economic and political control.7 Rather, the story addressed in
this book is that of proactive cooperation among nations with often divergent political
regimes, which nevertheless managed to forge a common strategic vision, and of dy-
namic statesmen with a strong understanding of the global economy and the vagaries
of international public opinion: From the first head of UNCTAD, the Argentine Raúl
Prebisch, to the Algerian revolutionary leader Houari Boumedienne.8
In the first two chapters, readers will find a broad account of the parallel births
and initial interaction (or lack thereof ) between the Global South and the Euro-
pean Economic Community—or European Community (EC) as it would later be
called, which included the EEC—created in 1957. The book’s primary argument,
developed in the subsequent four chapters, is that the common cause made by the
countries of the developing world to change their position in the international
economy, the partial success of their efforts—especially following the 1973 “oil
shock”—and the subsequent collapse of their united front after the twin oil and
monetary shocks of 1979–80, were developments that had a profound impact on
the nature of western European integration itself. Alan Milward, in his pioneering
works, has identified the significance of European integration up to the 1960s as a
process primarily directed at the “rescue of the nation-state.”9 If the EC eventually
become something more complex and permanent than a free market area, if it even
seemed to emerge as a possible new international actor, this has much to do with
the changing international environment in which it operated.
As much as possible in such a broad portrait, I have tried to attribute the
appropriate weight to the influence of individual personalities, the action of the

6
Pankay Mishra traces the origins of the intellectual alternatives to the European domination in
Asia back to the very beginning of the twentieth century; P. Mishra, From the Ruins of Empire. The
Revolt Against the West and the Remaking of Asia (London: Allen Lane, 2012).
7
John Darwin argues that, “far from heralding a ‘world of nations’, decolonization’s unexpected
course seemed to have set the scene for new kinds of empire.” J. Darwin, After Tamerlane. The Rise and
Fall of Global Empires 1400–2000, (London: Penguin, 2008) pp. 476–7.
8
The Third World has been defined by scholars like Vijay Prashad as a political and cultural project
that was potentially capable of generating a new form of internationalism in competition with the
established cooperative mechanisms of both Communism and liberal democracy. See V. Prashad, The
Darker Nations. A People’s History of the Third World (New York: The New Press, 2007). Odd Arne
Westad, in contrast, views the history of the Third World, itself the product of European ideology and
the Cold War, mainly as the story of a failure and of errors to be avoided in the future. As he argues,
“what is needed is a hard-nosed understanding of the Third World idea in order to avoid repeating its
mistakes.”O.A. Westad, “The Project,” (2008) 30(2)The London Review of Books 30.
9
A. Milward, The European Rescue of the Nation-State (Berkeley: University of California Press, 1992).
4 After Empires

European institutions in Brussels, the pressures of societal movements, and to the

turning points brought about by changes in the western European political and
cultural spectrum. It was possible to react in many different ways to the changes in
international politics and economics after decolonization. The outcome of the
1980s, that is the decision to identify European integration with a regional and
introverted project centered on increased competitiveness through the creative
forces of the Single Market, was not in fact a foregone conclusion. Up until the end
of the 1970s, and even into the first years of the 1980s, other paths were still open,
and here are given prominent attention.
In an essay written amidst the smoking embers of the Second World War, Arnold
Toynbee, the historian and diplomat with a precocious vision for grand ideas, de-
scribed the nations of western Europe as the battleground of non-European powers
and spoke of the “destructive recoil of European influence abroad upon Europe
herself.” It is worth citing the passage in which Toynbee makes reference to the
possibilities of European unification soon after the Second World War:
But is “union” the right name for the constellation of forces that we are forecasting?
Would not “partition” be a more accurate word? For if Eastern Europe is to be associ-
ated with the Soviet Union under Soviet hegemony and Western Europe with the
United States under American leadership, the division of Europe between these two
titanic non-European powers is the most significant feature of the new map to the
European eye. Are we not really arriving at the conclusion that it is already beyond
Europe’s power to retrieve her position in the world by overcoming the disunity that
has always been her bane? The dead-weight of European tradition now weighs lighter
than a feather in the scales, for Europe’s will no longer decide[s] Europe’s destiny. Her
future lies on the knees of the giants who now overshadow her.10
Pessimism, fatalism, and a healthy dose of historical determinism dominate this
analysis, which would ultimately bear little relation to the actual course of western
European integration: Itself a story largely underestimated by the most recent, and
otherwise valuable, syntheses on contemporary Europe.11 The process of western
European cooperation, however influenced by the logic of the Cold War from its
very beginning, was at the heart of its leaders’ response to the crisis of the nation

10
A.J. Toynbee, Civilization on Trial (New York: Oxford University Press, 1948), p. 124.
11
The most recent syntheses on the history of Europe after the Second World War pay a tribute to
the success but also to the instability of European democracies, and to the “dark” influence exerted
upon them by Fascism, racism, and other authoritarian tendencies: M. Mazower, Dark Continent:
Europe’s Twentieth Century (New York: Vintage, 2001). Alternatively, they spotlight the interconnec-
tion between events in western and eastern Europe, particularly the persistence of ethnic and national
hatreds: see N. Davies, Europe East and West (London: Jonathan Cape, 2006). These works form a
useful antidote to “institutional” histories which have focused only on western Europe and portrayed
postwar European history as a period void of such tensions and marked instead by the inevitable rec-
onciliation, peacemaking, and democratization leading to the creation of the institutions in Brussels.
On the other hand, as argued by Holger Nehring and Helge Pharo, this prevalently Anglo-Saxon and
Anglophone historiography is limited by considering Europe simply as a battleground of the Cold
War, a region replete with ethnic and social conflict, but never as an active protagonist in the effort to
construct a stable peace, either on the Continent or in the international sphere. See H. Nehring and
H. Pharo, “Introduction: A Peaceful Europe? Negotiating Peace in the Twentieth Century,” (2008)
17(3) Contemporary European History pp. 277–99.
 Introduction 5

state, helping to change their citizens’ material wellbeing and mental world view,
and certainly helping furnish a response to James Sheehan’s recent query: “Where
have all the soldiers gone?”12 Even if it is has not been possible here to provide a
detailed summary of the history of integration, its institutions, and its politics, the
author owes a great deal to the growing of research compiled by a generation of
young historians who are studying the phenomenon of European integration.13
The effort undertaken here simultaneously departs from a notion of western
Europe as a purely passive community, the chessboard of the two superpowers,
while attempting to outline the failures, the fateful shortsightedness, and the pro-
found discontinuities in the evolution of the integration process. Even though
there has been significant institutional stability since the creation of the ECSC
in 1951, the EC was not—and is not today, in its new guise as the European
Union—an irreversible or inexorable movement toward peace, justice, and happi-
ness, as some of the propaganda coming from Brussels would have it; rather, it is
an ever-changing entity deeply entwined with both international political and
economic pressures, and changes in its internal political climate.
* * *
No book, much less a work of history that depends upon years of patient labor, is
written in complete isolation. If it were so, I would long ago have missed two ideas
that are central to the pages that follow, the importance of which was imparted to
me by Antonio Varsori and Simone Paoli. The former taught me that European
integration is not a phenomenon that began in 1951 and developed continuously
to the present day; there have, instead, been so many different phases and ruptures
that one might almost speak of several distinct “European integrations.” I thus
became convinced that the Europe of the Single Market in the mid-1980s had
little to do with that of the Common Market in the 1960s and 1970s, and that it
was necessary to understand what had happened between these two profoundly
different moments. The latter brought my attention to the importance of 1968 as
a caesura—in western Europe as much as if not more than in the rest of the world—
and thus also as a turning point in the process of integration, if in no other way
than for the obvious rupture in the political and cultural climate of the entire con-
tinent. I have broadened not a little the concept of 1968 as a caesura, applying it
not only to questions of internal European affairs, but also to the relations between
western Europe and the rest of the world.
Then there are those to whom I owe thanks for advice, for many small and not-
so-small words of encouragement, who contributed valuable suggestions, proposed

12
J. Sheehan, Where Have All the Soldiers Gone?: The Transformation of Modern Europe (New York:
Houghton Mifflin Harcourt, 2008).
13
For some recent work on the history of European integration see the volume based on the con-
ference of the European Liaison Committee of Historians on the occasion of the 50th anniversary of
the Treaty of Rome: W. Loth, ed., Experiencing Europe: 50 Years of European Construction, 1957–2007
(Baden-Baden: Nomos, 2007); or W. Kaiser and A. Varsori, eds, European Union History. Themes and
Debates (London: Palgrave, 2010). The main research topics of young historians of European integra-
tion may also be found online at the site of the International Research Network of Young Historians
of European Integration (RICHIE): <http://www.europe-richie.org/>.
6 After Empires

corrections or alterations, and gave me indispensable moral and material assistance

during my research. In strictly alphabetical order, and shortening as much as
possible what would otherwise be a very long list, I thank with all my heart: Daniele
Caviglia, Mario Del Pero, Mark Mazower, Bernard Mommer, Mary Nolan, Franc-
esco Petrini, Federico Romero, all my colleagues and professors from the doctoral
program in the History of International Relations at the Università di Firenze and
in the Department of International Studies of the Università di Padova. Lorenzo
Ferrari has helped me with the maps. In the many archives I visited, some dusty
and neglected, others spacious and heavily supervised, I was fortunate enough to
encounter many willing and engaging interlocutors, among whom I would like to
remember in particular Jean-Marie Palayret, who constitutes an indispensable
point of reference for scholars of European integration in Fiesole (Florence).
I would like to thank particularly Christopher Wheeler for the opportunity to
publish at OUP.
This book was made possible by funding from the Dipartimento di Studi inter-
nazionali of the Università di Padova, by a semester research fellowship from
LUSPIO, by funding from the PRIN 2005 “Il Mediterraneo dalla crisi di Suez alla
seconda distensione” chaired by Professor Daniele Caviglia, by a research project
(2008–10) coordinated by Professor Lorenzo Mechi of the Università di Padova,
by the Short-Term Mobility program of the CNR, and by the Gerald Ford
Foundation. I greatly benefited from participating in the “Decolonization Seminar”
organized in Washington by the National History Center and directed by M. Roger
Louis.
Finally, I would like to thank the staff of the Biblioteca di storia moderna e
contemporanea and the Biblioteca del Senato in Rome, places where the writing of
much of this volume was completed.

This book is a revised and updated version of the Italian “Dopo gli imperi.
L’integrazione europea nello scontro Nord-Sud” (Le Monnier, 2009). While the
structure of the book remains basically the same, sections have been rewritten,
maps and bibliography have been added, and new archival research has been
conducted.
 1
The Third World and the Creation
of UNCTAD

In the words of William Roger Louis, “the year 1956 is to 1882 as the end is to the
beginning: Just as 1882 marks the start of the occupation, so 1956 severs the link
and can be seen as the end of the colonial era in Egypt and the beginning of the
new Scramble out of Africa and the Middle East.”1 Decolonization and the revolt
against the West would lead to national independence for most countries in Africa
and Asia by the early 1960s, while Latin American countries would resume their
never-fully-abandoned drive for economic and political emancipation.
Nobody could predict then whether these nations—spread out across Asia,
Africa, and Latin America; millions of peoples with different religions, languages,
and traditions—would be willing to find common interests or the capacity for
coordinated action. Indeed, there was a very real possibility that, once liberated
from European colonial domination, these peoples would only find themselves
subject to a new form of imperial tutelage by the two emergent superpowers, the
United States and the Soviet Union, each endowed with competing global ideolo-
gies, ambitions, and military might.
In 1933, in his last letter from jail to his daughter Indira Gandhi, Jawaharlal
Nehru wrote that “thought, in order to justify itself, must lead to action.”2 It should
come as no surprise if, among the elites of the new nations torn between Wilson
and Lenin, the virtues of free-market liberal democracy and the imperatives of
social revolution under a planned economy, the practical need to make giant leaps
forward through industrialization and higher prices for raw materials initially pre-
vailed over protracted theoretical debates regarding the appropriate form of gov-
ernment. The titanic task of achieving development would be accomplished both
by exploiting the military and economic assistance of any nation willing to provide
it, and through a coordinated effort to reform the international trade system in
their own favor. Antiwestern polemics and requests for some form of compensa-
tion for colonial “pillage” also offered an easy substitute for badly needed internal
social and economic reforms.
The Third World was very soon to become the main arena for the competing
visions of modernity and models of internationalism. But Third World countries did

1
W.R. Louis, Ends of British Imperialism: The Scramble for Empire, Suez, and Decolonization
(London: IB Tauris, 2006), p. 5.
2
J. Nehru, Glimpses of World History (Delhi: Oxford University Press, 1980), p. 953.
8 After Empires

not simply choose between these competing versions of modernity, just as they did
not passively accept the logic of the Cold War as a fait accompli—even though many
of the developing countries were forced to endure some of its devastating effects. As
the most recent historiography on the Third World has confirmed, developing
nations often struggled, both individually and collectively, to advance their own
visions of modernization, more often than not characterized by high levels of state
intervention and aspirations of fast-track industrialization,3 just as they fought to
promote their own priorities in the realm of human rights and international law.4
This chapter will focus on the economic dimension of Third World internationalism,
developed through the creation of the United Nations Conference for Trade and
Development (UNCTAD) in 1964 and embodied by the slogan “trade not aid.”

THE SPIRIT OF BANDUNG

Decolonization is a term widely used to describe the end of colonialism and the
decline of European empires. It can suggest a course of planned or progressive aban-
donment of colonial possessions. The reality was both much crueler and less edify-
ing. In the golden age of empires, the British Empire was spread across a territory
125 times larger than the United Kingdom; the Belgian Empire 78 times bigger
than the motherland; the Dutch Empire 55 times bigger than the Netherlands; and
the French Empire some fifteen times greater than its national territory. Even after
the end of the Second World War, the European nations that had not lost the con-
flict clung tightly to their colonial possessions, which they considered an extension
of the metropole, a central component of their prestige and national identity, and
vital economic “living space,” not to mention a strategic reserve of cheap labor.5
We shall see in the next chapter that western European governments were late in
understanding the dimensions of the revolution under way in world politics. But
not all European states, nor their leaders, reacted everywhere in exactly the same
manner. It should be noted, for example, that the Labour government of Clement
Attlee recognized very quickly that a peaceful resolution of the Indian question was
fundamental to the preservation of financial resources for the construction of the
welfare state in Great Britain. That very same Great Britain, however, conceded
independence to Malaysia only in 1957, after aiding a brutal, decade-long repres-
sion of its communist insurrection.6 That same year, in Kenya the British colonial

3
D. Engerman and C.Unger, “Introduction: Towards a Global History of Modernization,” (2009)
33(3) Diplomatic History.
4
S.L. Hoffmann, “Genealogies of Human Rights,” in S.L. Hoffmann, ed., Human Rights in the
Twentieth Century (New York: Cambridge University Press, 2011).
5
N. Davies, Europe: A History (New York: Harper, 2007), pp. 1068–9. Some recent syntheses of
the history of decolonization include M. Shipway, Decolonization and its Impact: A Comparative
Approach to the End of the Colonial Empires (Oxford: Blackwell, 2008); B. Droz, Histoire de la décolo-
nisation au XXe siècle (Paris: Seuil, 2006).
6
M. Thomas, B. Moore, and L.J. Butler, Crises of Empire. Decolonization and Europes’s Imperial
States, 1918–1975 (London: Bloomsbury, 2010), pp. 82–4.
 The Third World and the Creation of UNCTAD 9

administration, after having tried to suppress the Mau Mau uprising through the
use of concentration camps (in which allegedly more than 1 million Kikuyu were
imprisoned), deployed its own version of a final solution, ironically named Opera-
tion Progress, based on the physical elimination of all opposition.7 In at least
twenty other cases, the process of liberation brought with it war or armed revolt.
During the 1950s and 1960s, the world witnessed the restructuring of a form of
European commercial, military, and industrial colonization the distant origins of
which lay in the sixteenth century, but which had become a predominant global
force in the nineteenth-century Age of Imperialism.8 The Netherlands was forced
to concede independence to Indonesia in 1949, after having fought to the bitter
end—sending as many as 150,000 soldiers to southeast Asia—to retain control of
its oil resources, ultimately capitulating only before American threats of exclusion
from NATO and the Marshall Plan.9 France sustained two shocking military
defeats, first in Asia and later in Africa, before relinquishing its colonial ties. The
former, at the hands of the Vietnamese at Dien Bien Phu in 1954, was also “the
first victory [by an Asian nation] over the West, except by Japan, in a battle fought
by the two sides with equal weapons and on the same highly professional lines.”10
The road to liberation was even longer in Algeria: Only in 1962 did the French
resign themselves to withdrawal, after enduring a seemingly endless string of ter-
rorist attacks both in Africa and at home, finally overcome in the end by the Alge-
rian FLN’s international campaign to portray itself as progressive and to discredit
the repressive measures of the French army in the eyes of world opinion.11 In
Egypt, the British Conservative government of Anthony Eden miscalculated the
significance of an emergent Arab nationalism led by Gamal Abdel Nasser and,
along with the French Socialist government, embarked on an ill-fated military
venture to retake control of the Suez Canal.12 The independence conceded to
Ghana in 1957 and Guinea in 1958 paved the way for decolonization elsewhere in
Africa, but in 1960 Belgium nevertheless still intervened in the Congo against the
legitimate government of Patrice Lumumba, which appeared to threaten its eco-
nomic interests.
Structural changes in three areas of international politics and economics also
contributed to the end of European empires and aided the cause of the colonized
peoples.13 First, a spread of nationalist movements around the world was well
under way after the First World War. Even though the United Nations was initially

7
C. Elkins, Imperial Reckoning. The Untold Story of Britain’s <r>Gulag</r> in Kenya (New York:
Henry Holt and Company, 2005).
8
D. Abernethy, The Dynamics of Global Governance: European versus Overseas Empires 1415–1980
(New Haven, CT: Yale University Press, 2001).
9
M. Michel, Décolonisation et émergence du Tiers monde (Paris: Hachette, 1993), p. 139.
10
V.G. Kiernan, From Conquest to Collapse: European Empires from 1815 to 1960 (New York: Pan-
theon Books, 1962), p. 217.
11
M. Connelly, A Diplomatic Revolution: Algeria’s Fight for Independence and the Origins of the Post–
Cold War Era (New York: Oxford University Press, 2002).
12
M. Ferro, Suez 1956: naissance d’un Tiers Monde (Brussels: Complexe, 1995).
13
M. Ferro, Histoire des colonisations. Des conquêtes aux indépendances XIII–XX siécle (Paris: Seuil,
1994), p. 399.
10 After Empires

created as a concert of Great Powers that included European imperial states, its
General Assembly eventually became a stage for the international condemnation of
colonialism and of racism.14 A second change arose thanks to the intensification of
commercial relations between the industrialized nations—an inversion of the ten-
dency toward autarky and protectionism prevalent in the 1930s—and the perfec-
tion of transportation technologies, with their corresponding drop in shipping
costs. These developments rendered direct control of colonies’ raw materials both
more expensive—in terms of military spending and related sacrifices in the devel-
opment of national welfare states—and less necessary. Finally, there was the defini-
tive recognition of the role of the two superpowers, and the knowledge that
formerly colonized peoples could receive support from either of the two spheres of
influence professing a universal ideology. Indeed, as Frederick Cooper has noted,
the defeat of the European powers in southeast Asia at the hands of Japan had
already allowed their former colonies in that particular region to taste the the flavor
of national independence by the end of the Second World War.15 Such territories
would have to be de facto recolonized by former imperial masters, a much more
difficult and unpopular task in the context of the Cold War than simply control-
ling revolts in long-established territorial possessions.
If these changes contributed to the end of direct European colonialism, that
does not mean that the newly independent countries did not retain strong cultural
and economic ties with their former metropoles. Mineral and oil companies operat-
ing in former colonies were still mostly based in London, New York, Paris, or Brus-
sels, trade and migration was mainly directed towards the metropolitan areas, and
the majority of the new elite had been educated in one of the languages of their
former imperial masters. Nehru, though deeply influenced by the example set by
the communist revolution, still evoked his youthful ties with Great Britain when
dealing with the American ambassador John Kenneth Galbraith; the latter, in his
memoirs, recalled how in his advancing age the Indian statesman enjoyed reliving,
not the heroic period of Gandhi’s nonviolent independence struggle but his forma-
tive years at Trinity College, Cambridge and his encounters with the extraordinary
minds of scholars like R.H. Tawney or Sydney and Beatrice Webb.16 The influence
of European thought and practices helps to explain the strong desire of the new
nations and their leaders to remain independent both of East and West, and their
faith in their ability to develop autonomous national paths to economic and politi-
cal modernization. This is clearly echoed by the Indian Marxist historian K.M.
Panikkar:
The period of maritime authority over Asia, beginning with Vasco da Gama’s arrival
and ending with the departure of the Western fleets from their bases on the Asian

14
M. Mazower, No Enchanted Palace. The End of Empire and the Ideological Origins of the United
Nations (Princeton, NJ: Princeton University Press, 2009), pp. 186–7.
15
F. Cooper, “Reconstrucing Empire in British and French Africa,” in Mark Mazower, Jessica Rei-
nisch, and David Feldman, Post–War Reconstruction in Western Europe. International Perspectives 1945–
1949 (Oxford: Oxford University Press, 2011), p. 198.
16
J.K. Galbraith, A Life in Our Times: Memoirs (New York: Ballantine, 1981), p. 408.
 The Third World and the Creation of UNCTAD 11
continent, covers an epoch of the highest significance to human development. The
changes it directly brought about and the forces it generated in the countries of Asia
in contact with Europe for a period of 450 years, and subjected to Western domina-
tion for over a century, have effected a transformation which touches practically every
aspect of life in these countries. It is, therefore, not possible to survey them even in
general outline. The social, political and economic conditions of Asian countries have
undergone revolutionary changes as a result of these contacts and influences. Their
religious and philosophical systems, the material set-up of their lives and their mental
outlook have been affected to an extent which it is not possible for anyone to estimate
now. Everywhere in Asia this prolonged contact has produced ferments, the possible
effects of which cannot be foreseen.17
A rare exception among such widely used expressions, the origins of the term
“Third World” are well known: The phrase was coined in 1952 by the French
demographer Albert Sauvy in an article for the weekly magazine L’Observateur
(renamed Le Nouvel Observateur in 1964):
We speak often and willingly of two worlds and of a possible conflict between them,
of their co-existence, etc. And all too often we forget that there exists a third world,
the most important of all; chronologically speaking, it is that world which came
first.18
The term itself was evocative, making explicit reference to the Third Estate from
the years preceding the French Revolution, and its exclusion from political deci-
sion-making processes. But it was mute regarding the potential future of this
gigantic mass of humanity that was imagining transnational or pan-continental
federations but busily organizing itself into nation states. Vijay Prashad has in fact
spoken of the Third World as a project for cooperation among “the darker
nations.”19 And it is not a coincidence that it was a demographer like Sauvy that
first used this neologism to define a part of the planet, largely confined to the
southern hemisphere, the most noteworthy characteristic of which throughout the
twentieth century was precisely its impressive population growth.20
The Third World would remain, at any rate, a primarily Western definition. The
newly independent countries would determine their own identities, common
interests, and autonomous political networks through their joint struggles on the
international stage and their continued development of networks that had been

17
K.M. Panikkar, Asia and Western Dominance: A Survey of the Vasco Da Gama Epoch of Asian His-
tory (1498–1945) (London: Allen & Unwin, 1953), p. 479.
18
Y. Lacoste, Unité et diversité du Tiers Monde (Paris: La Découverte-Hérodote, 1984), p. 184.
19
V. Prashad, The Darker Nations: A People’s History of the Third World (New York: The New Press,
2007).
20
For some considerations on Sauvy’s seminal article see M. Connelly, Fatal Misconception. The
Struggle to Control World Population (Cambridge: Belknap Press, 2008), pp. 153–4. Hobsbawm notes
that while in 1900 peoples of European origin represented approximately one-third of humanity, the
tragic period between the two world wars completely altered the demographic picture in favor of the
colonized regions. The population of the member states of the OCSE at the end of the 1980s, in fact,
represented no more than 15 percent of mankind. E.J. Hobsbawm, The Age of Extremes: A History of
the World, 1914–1991 (New York: Vintage, 1994), p. 345.
12 After Empires

established after the first World War.21 The first of these initial struggles, inevitably,
was to avoid being transformed from colonies simply into pawns in the great game
of the Cold War. A significant demonstration of their desire for autonomy and
capacity for self-organization came in 1955 with the Bandung Conference, pro-
moted by Nehru, Nasser, and the Indonesian leader Akmed Sukarno. The meeting
was a major event watched closely by the international press; for the first time the
governments of the “non-white” peoples had organized their own international
event.22 Often erroneously remembered as the foundation of what would become
the Non-Aligned Movement (NAM), the meeting in Bandung was in reality moti-
vated by tangentially related considerations: Halting Chinese expansion in Asia,
thus avoiding potential conflict with the United States after the end of the Korean
War; reacting to the “Pactomania” with which the US Secretary of State John Fos-
ter Dulles sought to contain Soviet expansionism (SEATO, the South-East Asia
Treaty Organization, was signed in 1954); affirming their right to neutrality with
respect to the two superpowers; and upholding the need to proceed with nuclear
disarmament. Anti-imperialism and modernization to “catch up” with the West
were the common ambitions voiced by Afro-Asian leaders.23 The twenty-nine par-
ticipants at the conference were primarily newly created Asian and African
nations—the Asian representatives prevailed in both numbers and importance
over their six African counterparts—but not all could be classified as neutrals:
Pakistan, Japan, the Philippines, Thailand, Iran, and Turkey were tightly woven
into the American sphere of influence, while the People’s Republic of China was
still closely linked to the Soviet Union. The Bandung Declaration included calls for
universal access to the United Nations, but lacked precise claims for international
economic reform.24 Above all, the summit celebrated a growing spirit of “Afro-
Asian” cooperation founded on a recognition of common desires for racial repara-
tion and emancipation from the control of the superpowers.25
Midway through the 1950s the pace of decolonization had accelerated, as we
have seen, tied in particular to the failure of Western military intervention during
the Suez crisis. A significant role was played in this process by the pan-Arabism of

21
M.P. Bradley, “Decolonization, the Global South, and the Cold War, 1919–1962,” in M.P. Lef-
fler and O.A. Westad, eds, The Cambridge History of the Cold War: Origins, 1945–1962 (Cambridge:
Cambridge University Press, 2012).
22
G.P. Calchi-Novati and L. Quartapelle, La conferenza afro-asiatica di Bandung in una prospettiva
storica (Rome: Carocci, 2007).
23
C.J. Lee, “Between a Moment and an Era: The Origins and Afterlives of Bandung,” in C.L. Lee,
ed., Making a World After Empires (Athens: Ohio University Press, 2010), pp. 1–45.
24
G. McTurnan Kahin, The Asian-African Conference: Bandung, Indonesia, April 1955 (Ithaca, NY:
Cornell University Press, 1956), p. 34: “It was further recognized that the assistance being received by
certain participating countries from outside the region, through international or under bilateral
arrangements, had made a valuable contribution to the implementation of their development pro-
grammes.” The conference’s promoters included: Ceylon, India, Indonesia, and Pakistan. Representa-
tives of the following nations were invited to participate: Afghanistan, Cambodia, China, Egypt,
Ethiopia, Côte d’Ivoire, Iran, Iraq, Japan, Jordan, Laos, Lebanon, Liberia, Nepal, the Philippines,
Saudi Arabia, Sudan, Syria, Thailand, Turkey, the Democratic Republic of Vietnam (North), Vietnam
(South), and Yemen.
25
O. Guitard, Bandoung et le réveil des peuples colonisés (Paris: PUF, 1969).
 The Third World and the Creation of UNCTAD 13

Nasser, whose government, with its authoritarian undertones, promoted agrarian

reform, undertook several economic experiments with a socialist flavor, expanded
its influence in Iraq, Syria, and Yemen, and furnished diplomatic support to the
Algerian liberation movement.26 A similar influence was exerted in Africa by Gha-
na’s Kwame Nkrumah, who broadcast appeals across the continent for economic
independence and unity among the African peoples.
The year 1960 opened with British Conservative Harold Macmillan’s important
address at Cape Horn, known as the “Wind of Change” speech. Macmillan had
perceived the significance of the coming challenge from the Third World—the
“wind of change”—though he partially misunderstood its origins, reading it purely
in terms of the conflict between East and West:
As I see it the great issue in this second half of the twentieth century is whether the
uncommitted peoples of Asia and Africa will swing to the East or to the West. Will
they be drawn into the Communist camp? Or will the great experiments in self-
government that are now being made in Asia and Africa, especially within the Com-
monwealth, prove so successful, and by their example so compelling, that the balance
will come down in favour of freedom and order and justice?27
Sixteen new countries had already been admitted en masse to the UN in 1955.
They were joined in 1960 by an additional fifteen decolonized states. In December
of that year, in the glass palace of the UN in New York, the organization approved
the “Declaration on the Granting of Independence to Colonial Countries and
Peoples,” a statement that heralded the numerical superiority of the newly inde-
pendent nations in the General Assembly. Even more importantly, the Declaration
signaled these countries’ intent to take charge of the human rights agenda, and to
impress on global public opinion the idea that the right to national self-determina-
tion would take precedence over the other universal rights listed in 1948 by the
UN.28 In the future, only a veto by one of the five major powers on the Security
Council could block the will of the majority of Third World countries. A new axis
of international conflict had been created, which intersected with that between
East and West: The confrontation between North and South.
After a series of preparatory encounters among the Bandung nations under
the active leadership of the Yugoslav president Tito—the organizer of the Bri-
oni Conference in 1956, who early in 1961 sailed from Ghana to Egypt on his
famous “peace ship” Galeb to persuade Third World leaders to convene a new
meeting—the Non-Aligned Movement was formally launched in Belgrade in
September 1961.29 Its objective remained the easing of military tensions,

26
G. Corm, Fragmentation of the Middle East: The Last Thirty Years (London: Hutchinson, 1988),
p. 27.
27
“The Wind of Change: Speech by the Rt. Hon. Harold Macmillan, Prime Minister, to both
Houses of Parliament of the Union of South Africa, Cape Town, February 3, 1960,” in British Imperial
Policy on Decolonization: 1938–1964, vol. 2 (London: Macmillan, 1980).
28
R. Burke, Decolonization and the Evolution of International Human Rights (Philadelphia: Univer-
sity of Pennsylvania Press, 2010), pp. 50–58.
29
Marco Galeazzi, Il PCI e il movimento dei paesi non allineati (1955–1975). Milan: Franco Angeli,
2011.
14 After Empires

Founders of the Non-Aligned Movement (Afghanistan, Algeria (FLN), Burma, Cambodia, Ceylon (later Sri Lanka),
Congo, Cyprus, Cuba, Ethiopia, Ghana, Guinea, Indonesia, Iraq, Lebanon, Mali, Morocco, Nepal, Saudi Arabia,
Sudan, Tunisia, United Arab Emirates, United Arab Republic, Yemen (but see below), Yugoslavia)

Countries that joined the Non-Aligned Movement betweenits founding and 1976 (Angola, Argentina, Bahrain,
Bangladesh, Bhutan, Botswana, Burundi, Cameroon, Cape Verde Islands, Central African Republic, Chad,
Dahomey, Egypt, Equatorial Guinea, Gabon, Gambia, Guinea-Bissau, Guyana, India, Ivory Coast, Jamaica,
Jordan, Kenya, Kuwait, Laos, Lesotho, Liberia, Libya, Madagascar, Malaysia, Malta, Mauritania, Mauritius,
Mozambique, Niger, Nigeria, Nigeria, Oman, Peru, Qatar, Rwanda, São Tomé and Principe, Senegal,
Sierra Leone, Singapore, Somalia, Swaziland, Syria, Tanzania, Togo, Trinidad and Tobago, Uganda, Upper Volta,
South Vietnam, North and South Yemen (but see above), Zaire, and Zambia)

Figure 1.1. The Non-Aligned Movement (1961–1976)

offering alternatives to escape the blackmail and coercive compromises imposed

by the Cold War.30 The meeting, while upholding the Bandung principles, was
also decidedly different from its predecessor. The presence of a country like
Cuba broadened the alliance beyond its Afro-Asian origins, offering admission
to a Latin America whose states had been considered to that point almost as
culturally dependent arms of the Western powers. The exclusion of states like
Pakistan or China, compromised by their presence in the military alliances of
the Cold War, and the simultaneous refusal to include European neutrals like
Ireland or Sweden, served to protect the autonomy and ex-colonial nature of
the movement—with the notable exception of Yugoslavia, which hoped to

30
1961 was a year of heightened military tensions: Witness the French nuclear tests in the Sahara,
the resumption of Soviet testing, the Bay of Pigs, the construction of the Berlin Wall, and the begin-
nings of conflict between China and the Soviet Union, as well as the emergence of open conflict
between China and India. P. Calvocoressi, World Politics Since 1945 (London: Longman, 1996),
pp. 170–98.
 The Third World and the Creation of UNCTAD 15

play the role of bridge to the developed world. 31 Even though there was no
clear provision for another conference after Belgrade, the birth of the Non-
Aligned Movement thus marked an occasion to voice the demands of a more
active and militant anticolonialism, also alert to economic concerns thanks
to the influence of Nkrumah, who pushed for a follow-up meeting of the
non-aligned the next year, centered exclusively on economic issues. 32 At the
same time, the NAM quickly exposed the limits of the Afro-Asian project,
in its attempt to construct a homogenous political ideology of non-Euro-
pean races and cultures based on confrontation and collective action in
international politics. These limits emerged first during the standoff between
India and China, two of the cornerstones of the Afro-Asian world, and again
with even greater strength and clarity following the Sino-Soviet split of the
early 1960s. 33 During Communism’s Great Schism, in fact, China attempted
to play the Afro-Asian card against the “European” Soviet Union in order to
portray itself as vanguard of the colonized peoples; the USSR, in response,
sought to invest in the concept of non-alignment to win the support of its
most progressive elements, favoring an “active neutrality” that could help its
fight against the capitalist West. 34
Whatever its internal tensions, the birth of the Non-Aligned Movement con-
firmed the emergence of a new political actor. In his book What is History?, first
published in 1961, E.H. Carr wrote that “it is only today that it has become pos-
sible for the first time even to imagine a whole world consisting of peoples who
have in the fullest sense entered into history and become the concern, no longer of
the colonial administrator or of the anthropologist, but of the historian.”35 If this
was history in the making in the Third World, it promptly grabbed the undivided
attention of the superpowers, which radically altered their foreign policies to
accommodate the new scenario.
After Stalin’s death in 1953, the Soviet Union had begun to shift its attention
from the balance of forces in Europe, based on a notion of the USSR as a continen-
tal power and a strategy of waiting for the inevitable contradictions in Western capi-
talism to manifest themselves, to conceive also a more offensive and global strategic
vision. The world was no longer interpreted according to the classic division into
two armed camps; instead, new fronts appeared to be opening that could revitalize

31
The twenty-five participants at the Belgrade meeting were: Afghanistan, Algeria (FLN), Burma,
Cambodia, Ceylon, Congo, Cyprus, Cuba, Ethiopia, Ghana, Guinea, Indonesia, Iraq, Lebanon, Mali,
Morocco, Nepal, Saudi Arabia, Sudan, Tunisia, United Arab Emirates, The United Arab Republic [the
union of Egypt and Syria], Yemen, and Yugoslavia.
32
D. Colard, “Le mouvement des pays non-alignés,” (1981) 4613 Notes et etudes documentaires,
p. 29.
33
F. Fejtö, Chine–URSS de l’alliance au conflit 1950–1972 (Paris: Seuil, 1973).
34
Open Society Archives, Radio Free Europe Research, Slobodan Stankovic, Tito and Non-
Alignment, December 6, 1967. F. Halliday, “The Middle, the Great Powers and the Cold War”, in
Yezid Sayigh and Avi Shlaim East (eds), The Cold War and the Middle East (Oxford: Clarendon
Press, 1997), p. 19.
35
E.H. Carr, What is History? (New York: Vintage, 1961), p. 199.
16 After Empires

the international communist movement.36 In the report of the Twentieth Congress

of the Communist Party of the Soviet Union (CPSU) in 1956—when the Soviet
leadership distanced itself, for the first time, from Stalinist “excesses”—a new atti-
tude to the developing world was already emerging: “The new period in history
which Lenin predicted has arrived, and the peoples of the East are playing an active
part in deciding the destinies of the whole world, are becoming a new mighty factor
in international relations.”37
Stalin’s successor as head of the Communist Party, Nikita Khrushchev, has been
considered the most important reformer of Russian imperial foreign policy since
the time of its formation.38 He took a traditionally expansionist Eurasian power,
accustomed to following western European initiatives in the Straits, the Mediter-
ranean, and the Asiatic steppe, where it sought to check English domination in
India, and attempted to transform it into a world power capable of pursuing a
truly global strategy. The Soviet leader fueled these new ambitions by exploiting
progress in the field of nuclear technology, which permitted Moscow to keep pace
with Washington, and by publicizing the innovative capacity of Soviet scientific
research—such as the launching into orbit of the first artificial satellite, Sputnik—
which demonstrated the prestige and apparent productive efficiency of the planned
economy. Beginning at the Twentieth Congress, Khrushchev gave a decidedly pos-
itive spin to decolonization, considering the new non-aligned states as Moscow’s
natural allies, and opening the USSR to the wind blowing from the East.39 Indeed,
it was precisely in 1956–7 that the Institute of World Economy and International
Relations (IMEMO, in Russian) was created, with the intention of giving the
Soviet leadership an instrument for strategic policy planning in the Third World.40
This new course, which declared Moscow’s desire to break out of the isolation to
which Dulles and the discredit of the 1956 invasion of Hungary had helped to
condemn it, was given concrete expression with an increase in financial and mili-
tary aid distributed to the leaders of countries considered in the regional vanguard:
Lumumba and Nasser in Africa, Nehru in Asia, and Castro in Latin America.
Khrushchev ostentatiously declared his support for the UN Declaration of Inde-
pendence of the Colonized Peoples in 1960, remaining in New York for an entire
month during the preparations of the General Assembly—while President Eisen-
hower left to play golf—and resorted to exaggerated gestures, such as famously
banging his shoe on the table, to draw attention to Soviet policy in the Third
World and deflect attacks against its own imperial policy in eastern Europe. In

36
A. Fursenko and R.S. Naftali, Khrushchev’s Cold War: The Inside Story of an American Adversary
(New York: W.W. Norton & Co., 2006), p. 314.
37
C. Andrew, The World Was Going Our Way: The KGB and the Battle for the Third World (New
York: Basic Books, 2005), p. 5.
38
A.Z. Rubenstein, Moscow’s Third World Strategy (Princeton, NJ: Princeton University Press,
1998).
39
O.A. Westad, The Global Cold War (Cambridge: Cambridge University Press, 2005), p. 68.
40
C.R. Dannehl, Politics, Trade, and Development: Soviet Economic Aid to the Non-Communist Third
World, 1955–1989 (Dartmouth: Ashgate, 1995), p. 33.
 The Third World and the Creation of UNCTAD 17

January 1961, in a speech at an academy for future party leaders, he gave a posi-
tively glowing evaluation of the future prospects for international communism:
Our era . . . [is] an era of Socialist revolutions and national liberation revolutions; an
era of the collapse of capitalism and of liquidation of the colonial system; an era of the
change to the road of socialism by more and more nations; and of triumph of social-
ism and communism on a world scale.41
The great faith placed by the Soviet Union in the possibilities offered by the Third
World was further demonstrated by the inauguration of the University of Friend-
ship in Moscow, which opened its halls to students from Africa, Asia, and Latin
America, preparing them for future socialist struggles.42
The reaction of the United States to decolonization was more conflicted. Not-
withstanding its repeated reminders of the fact that the USA itself had been born
in rebellion against a colonial empire, Washington assumed a much more ambigu-
ous position regarding liberation movements, if for no other reason than that it
was precisely those European “imperialists” that happened to be America’s primary
allies. With the emergence of the Cold War, the United States had turned its atten-
tion to western Europe out of the perceived necessity to rebuild the continent in
order to avoid the risk of communist revolution. In Latin America, however, the
USA soon demonstrated that it had not relaxed its iron grip over the region, over-
throwing the government of Colonel Jacobo Árbenz Guzmán in Guatemala after
it had attempted to pass radical agricultural reforms that would have entailed a
massive expropriation of land from the United Fruit Company. The episode con-
tributed to no small degree toward alienating Latin American leaders and eviscerat-
ing any anticommunist sympathies they may have harbored for the gringos from
the north.43 In Africa, meanwhile, Eisenhower was incapable of taking a firm stand
to distance the USA from French repression in Algeria. On the chessboard of the
Middle East, a joint action of the USA and Great Britain led to the 1953 coup
against the Mossadegh government in Iran, guilty of having nationalized the coun-
try’s oil resources, leading to the involvement of US oil multinationals in the previ-
ously British reservoir.44 As a result, not even Dulles’s condemnation of the
Franco-British invasion of Egypt in 1956, coupled with the threat to expel the two
countries from NATO, was enough to win African loyalties. At the UN in 1960,
the USA could not bring itself to vote in favor of the resolution against colonial-
ism: Broad segments of the American political class continued to view neutrality as
an immoral concept in foreign policy, failing to comprehend the disquieting
impact of a comment by a White House staffer (leaked to the media) that he was

41
Cited in J.L. Gaddis, We Now Know: Rethinking Cold War History (New York: Oxford University
Press, 1997), p. 183.
42
Rubenstein, Moscow’s Third World Strategy.
43
W.R. Keylor, The Twentieth Century World: An International History (Oxford: Oxford University
Press, 2001), pp. 311–12.
44
In 1955 the Anglo-Iranian Oil Company renamed itself British Petroleum (BP) so where its
allegiance lay could become more visible. See J. Bamberg, British Petroleum and Global Oil, 1950–
1975: The Challenge of Nationalism (Cambridge: Cambridge University Press, 2000).
18 After Empires

sick and tired of organizing Presidential meetings with all those niggers. Mean-
while, Washington prepared a military operation against Castro in Cuba, even
when the latter had not yet openly revealed his preference for a pact of steel with
Moscow.
A change of perspective arrived with the election of John F. Kennedy. The young
Democrat began his term with an overture to the newly independent nations, “not
because the Communists are doing it, not because we seek their votes, but because
it is right.”45 In a 1960 speech at the University of Michigan he announced the
creation of the Peace Corps, a project aimed at encouraging American students to
volunteer their time working in the developing world (identifying Ghana by name
as a destination for their youthful generosity), thus reaffirming the idea that the
competitiveness of free societies depended on individual willingness to sacrifice for
the national wellbeing.46 We shall see later how Kennedy also launched the Alli-
ance for Progress with Latin America, while simultaneously changing the terms
and conditions of the economic aid furnished to less developed countries.
Internal factors also pressured the Kennedy administration to modify American
attitudes, most notably the growing combativeness of the civil rights movement.
With the emergence of the newly independent African nations came the need to
avoid losing them to communism; it thus became ever more difficult to ignore the
violent—and highly visible—discrimination against African-Americans in the US
South, a contradiction that Fidel Castro ably manipulated by setting up his head-
quarters in the predominantly black neighborhood of Harlem while attending the
UN General Assembly in 1960. African-American civil rights organizations actively
sought direct ties with these new nations in order to gain a political edge in the
fight for the betterment of the black people in the USA. In his memoir, John
Lewis, one of the most prominent leaders of the National Association for the
Advancement of Colored People (NAACP), recalled the epiphany of his experi-
ence touring Africa with other members of the organization:
From Dakar we flew south aboard an Air Guinea jet piloted by two black men and
staffed by black flight attendants. With all the flying I’d done in the United States,
this was the first time I’d ever seen black pilots. And that was just the beginning. In
every city I visited, I was struck by the sight of black police officers, black men
behind the desks in banks, black people not just on bicycles but also behind the
wheels of Mercedes. Black people in charge. Black people doing for themselves.
I knew the situation over there, but knowing it was one thing; actually seeing it was
another.47
Even Malcolm X, who accused the NAACP and Martin Luther King of timidity
and collaboration with America’s white elite, traveled to Cairo in 1964 for a con-

45
L. Tosone, “Gli aiuti allo sviluppo degli Stati Uniti in Africa durante l’amministrazione Kennedy,”
in D. Caviglia and A. Varsori, eds, Dollari, petrolio e aiuti allo sviluppo. Il confronto Nord-Sud negli anni
’60-’70 (Milan: FrancoAngeli, 2008), p. 23.
46
Online at <http://www.peacecorps.gov/index.cfm?shell=learn.whatispc.history.speech>.
47
J.L. Lewis, Walking with the Wind: A Memoir of the Movement (New York: Harcourt Brace,
1998), p. 295.
 The Third World and the Creation of UNCTAD 19

ference of the Organization of African Unity in order to win support for a UN

resolution against racism in the United States. In a letter from August of that year
he remarked enthusiastically that his appeal had been a success and that “our prob-
lem has been internationalized.”48
The leaders of the civil rights movement were not the only ones calling for closer
cooperation with the developing nations in order to transcend the logic of Realpoli-
tik in US relations with the Third World. The voice of the nascent student move-
ment also began to make itself heard, by distancing itself from a politics based
exclusively on containment and the suppression of international communism. The
1962 Port Huron Statement of SDS (Students for a Democratic Society) openly
denounced:
American foreign policy [that] in the Fifties was guided by a concern for foreign
investment and a negative anti-communist political stance linked to a series of mili-
tary alliances, both undergirded by military threat. We participated unilaterally—
usually through the Central Intelligence Agency—in revolutions against governments
in Laos, Guatemala, Cuba, Egypt, Iran. We permitted economic investment to deci-
sively affect our foreign policy: Fruit in Cuba, oil in the Middle East, diamonds and
gold in South Africa (with whom we trade more than with any African nation) [ . . . ].
Our pugnacious anti-communism and protection of interests has led us to an alli-
ance inappropriately called the “Free World.” It included four major parliamentary
democracies: Ourselves, Canada, Great Britain, and India. It also has included through
the years Batista, Franco, Verwoerd, Salazar, De Gaulle, Boun Oum, Ngo Diem, Chi-
ang Kai Shek, Trujillo, the Somozas, Saud, Ydigoras—all of these non-democrats sepa-
rating us deeply from the colonial revolutions.49

RECIPES FOR DEVELOPMENT

The emergence of the newly independent countries not only had an impact on the
Cold War and international politics, but also allowed new voices to speak up that
were critical of the organization of the international economy.
In 1950, the Western world once more accounted for approximately 57 percent
of global production: The same percentage it had reached some 120 years earlier,
when the productive capacities of the colonized world had begun to contract.50
The economies of western Europe, like those of the communist East, were prima-
rily driven by domestic reconstruction, which began to take off at a dizzying
rate; industrial production in these countries grew at a rate of 6 percent a year
from 1953 until 1975. International trade also witnessed a sudden surge, such
that in 1957 the total value of commerce in manufactured goods surpassed that in

48
Malcolm X, By Any Means Necessary (New York: Pathfinder Press, 1970), p. 132. [Italics in
original.]
49
Online at <http://coursesa.matrix.msu.edu/~hst306/documents/huron.html>.
50
S.P. Huntington, The Clash of Civilizations and the Remaking of World Order (New York: Simon
& Schuster, 1996) p. 87.
20 After Empires

commodities.51 The industrialized countries had begun to lay the groundwork for
the “affluent society,” a society founded, as we shall see, on a type of mass con-
sumption that spread from the United States throughout western Europe. In 1959
a German paper could already speak of “our consumer society,” where only a dec-
ade earlier Germany had been destroyed by the war and reduced to “Year Zero,” its
people without food, its buildings in a shambles, its spirit shattered.52
This productive revolution of the Western, industrialized world, which was not
without its dark sides and internal contradictions, was accompanied and sheltered
by international economic institutions. These new, multilateral institutions encom-
passed only a very limited part of the globe, however, leaving its most populous
areas at the margins. The Pakistani writer Saadat Hasan Manto described how the
meager affluence on display in many poorer countries at the outset of the 1950s
was simply imported by foreign aid, which had been granted for strategic reasons
and brought with it inevitable bonds of subordination:
You will certainly ask me out of astonishment why my country is poor when it boasts of
so many Packards, Buicks and Max Factor cosmetics. That is indeed so, uncle, but I will
not answer your question because if you look into your heart, you will find your answer
there (unless you have had your heart taken out by one of your brilliant surgeons).
That section of my country’s population which rides in Packards and Buicks is really
not of my country. Where poor people like me and those even poorer live, that is my
country.53
At the end of the Second World War the economic and social recovery of vast por-
tions of the globe was simply not on the agenda of the victorious nations. The
international economic institutions created at Bretton Woods included only a
minority of the world’s governments and peoples. The entire communist world
was excluded owing to its hostility to the free market economy—including China,
the largest Asian nation—as were the majority of colonized peoples, who only
began to reacquire their independence in the 1950s.54
It was not just the territorial under-representation inherent in the Bretton
Woods system that prevented it from taking into account the specific problems
confronting the “underdeveloped countries,” as they were called at the time. The
attention of Anglo-Saxon economists centered on the internal reforms necessary
for the most advanced nations, based on the conviction that for everyone else it
would suffice merely to imitate their success. If a nation failed to achieve economic
growth, whether European France or Latin American Colombia, independent of
their relative level of development or geographic, social, historical, or educational
conditions, economists of the age were quick to pin the blame on the poor per-
formance of their political class. A UN report compiled in 1950 by a group of five

51
P. Kennedy, The Rise and Fall of the Great Powers (New York: Vintage, 1989), pp. 347–437.
52
V. de Grazia, Irresistible Empire: America’s Advance through Twentieth-Century Europe (Cam-
bridge, MA: Harvard University Press, 2005), p. 359.
53
S.H. Manto, Letters to Uncle Sam (Islamabad: Alhamra, 2001), p. 21.
54
P. Kennedy, The Parliament of Man: The Past, Present, and Future of the United Nations (New
York: Random House, 2006), p. 117.
 The Third World and the Creation of UNCTAD 21

experts prescribed the following cure for the underdeveloped nations: Enact pro-
gressive economic and fiscal policy, control population growth, and invest in tech-
nology. As the prescription did not entail any consequent distribution of the
necessary medicine, in either monetary aid or technological cooperation, it was a
slippery slope from this view to the outright racism of attributing the inability to
jump-start the motor of growth to the innate ethnic or cultural characteristics of a
people. Theories abounded as to why poverty seemed endemic to certain areas of
the world, most ascribing this to the stubborn lack of a work ethic among certain
peoples: The “defensiveness” of the Indians, the “negativity” of the Cubans, or the
“religious superstitions” that held back Ceylon.55
In his biography of John Maynard Keynes, Roy Harrod notes that the econo-
mist confided his plans for the postwar international economy in a 1943 letter to
Sir Percival Liesching:
As you know, I am, I am afraid, a hopeless sceptic about this return to nineteenth-
century laissez faire, for which you and the State Department seem to have such a
nostalgia.
I believe that the future lies with –
(i) state trading for commodities;
(ii) international cartels for necessary manufactures; and
(iii) quantitative import restrictions for non-essential manufactures.56
Like many of his earlier warnings, Keynes’s ideas fell on deaf ears during the course
of the Bretton Woods negotiations. In reality the Bretton Woods institutions—the
International Bank for Reconstruction and Development (IBRD, later the World
Bank), the International Monetary Fund (IMF), and what would become the
General Agreement on Tariffs and Trade (GATT)—were built on a philosophy
defined by John Ruggie as “embedded liberalism”: Allow enough progress toward
liberalization but also give space to governments to defend their social and political
priorities.57 The new multilateral institutions were certainly more sophisticated
and less dependent on naked power than the trade and financial practices of the
nineteenth century, defined in a seminal article by Gallagher and Robinson as “the
imperialism of free trade”;58 but these institutions did not specifically take into
account the peculiar necessities of the nonindustrialized world.
In the first draft of the World Bank statute, the word “development” does not
appear even once. The immediate goal of the Bank was actually to finance Euro-
pean reconstruction. Only after the beginning of the Marshall Plan in 1948 did
the Bank, seeing its principal raison d’être disappear, begin to search for new oppor-
tunities to invest in development, a circumstance which worried its then-president

55
D. Kapur, J.P. Lewis, and R. Webb, The World Bank: Its First Half Century (Washington, DC:
Brookings Institution Press, 1997), p. 146.
56
R. Harrod, The Life of John Maynard Keynes (London: Macmillan, 1951), pp. 567–8.
57
J.G. Ruggie, “International Regimes, Transactions, and Change: Embedded Liberalism in the
Postwar Economic Order,” (1982) 46(3) International Organization pp. 379–415.
58
J. Gallagher and R. Robinson, “The Imperialism of Free Trade,” (1953) 6(1) Economic History
Review, pp. 1–15.
22 After Empires

John McCloy (eventually to become the main exponent of US oil policy): “I think
we are going to be driven into a very different field sooner than I thought, into the
development field.”59 But the Bank’s funds amounted to a fraction of those at the
disposal of the Marshall Plan. In 1953 the Bank had granted loans for a total of
some $1.75 billion—primarily throughout western Europe—while by mid-1951
the Marshall Plan had already transferred some $12 billion in aid to the participat-
ing European nations.60 In contrast, the World Bank had sent less than $100 mil-
lion to the poorest countries by 1950, because sufficient possibilities for investment
were lacking. Until 1957 the majority of its investments remained in the developed
nations. Only at the end of the 1960s did the Bank almost completely close shop
in the industrialized world.61 Bank loans were mainly granted for the creation or
reconstruction of infrastructure and, because the funds for investment came largely
from the private sector, these infrastructural improvements needed to be able to
generate profits in order to repay the debt quickly and with interest. For at least the
first decade of its existence the Bank shied away from loans for the creation of
industry, still less those to help commodity producers: Such activities were deemed
better left to private investment. Bank presidents tended to come from the upper
echelons of Wall Street, a trend that granted the institution credibility and that
allowed it to boast a positive balance sheet until the beginning of the 1960s. In
short, the World Bank was able to extract some returns from its Third World
investments, without yet providing a meaningful economic stimulus to those
countries considered underdeveloped. The World Bank, however, was a relatively
marginal international creditor, furnishing barely 5 percent of all development aid
by 1957. The 1950s were instead a decade dominated largely by bilateral aid, in
particular military aid from the United States, which comprised some 60 percent
of the total, and that of the metropoles to their former colonies.62
The goal of the IMF, meanwhile, was to guarantee the stability of exchange rates,
so far as this was possible in a system in which western Europe’s most important
currencies still were not fully convertible. At the end of the 1950s the scarce IMF
loan funds available to Third World nations were tied to stabilization programs of
such austerity that The Economist, in an article on the loan conditions applied to
Latin American countries, called Per Jacobsson (then the IMF’s managing director)
“Mr. Khrushchev’s secret weapon.”63
The other pillar of global economic reconstruction, after the tragic results of
the nationalistic and autarkic experiments of the 1930s, was supposed to be the

59
M. Alacevich, The Political Economy of the World Bank: The Early Years, trans. The World Bank
(Palo Alto, CA: Stanford University Press, 2009), p. 13.
60
M.J. Hogan, The Marshall Plan: America, Britain, and the Reconstruction of Western Europe 1947–
1952 (New York: Cambridge University Press, 1987), p. 415.
61
E.S. Mason and R.E. Asher, The World Bank Since Bretton Woods: The Origins, Policies, Opera-
tions, and Impact of the International Bank for Reconstruction and Development, and the other Members
of the World Bank Group (Washington, DC: The Brookings Institution Press, 1973).
62
R.E. Wood, From Marshall Plan to Debt Crisis: Foreign Aid and Development Choices in the World
Economy (Los Angeles: University of California Press, 1986), pp. 70–1.
63
H. James, International Monetary Cooperation Since Bretton Woods (Washington, DC: Interna-
tional Monetary Fund and Oxford University Press, 1996), p. 141.
 The Third World and the Creation of UNCTAD 23

creation of an International Trade Organization (ITO). Preliminary negotiations

toward the creation of an ITO were held in Havana from 1947–8, under the aus-
pices of the United Nations Conference on Trade and Employment. Frictions
quickly developed, however, between the British, who wished to maintain trade
preferences with the Commonwealth countries—preferences which Churchill
himself admitted were of greater symbolic than economic value—and the United
States, which sought to eliminate such preferences and all other customs barriers as
far as possible.64 A group of developing countries, led by Argentina, Chile, and
Brazil, also played an active role in seeking to defend their levels of employment
and industrial investment, managing to insert into the accords measures that would
allow for the expropriation of foreign businesses, as well as a system of regional
trade preferences.65 In March 1948, the Havana Charter was approved by the UN,
despite fierce resistance by the American delegation.66 Ultimately, however, the
agreement remained a dead letter, never ratified by the American Congress.67 The
Cold War had begun in earnest and the American government preferred to pro-
ceed down the path of liberalization and reinforce its transatlantic political and
economic ties, rather than allow itself to be hamstrung by yet another international
organization compromised by the presence of the communist countries.
Instead it was the GATT agreement, signed in 1947, that would long remain
the primary instrument of international coordination on questions of commerce.
In principle, the agreement was supposed to be of solely provisional value pending
the creation of the ITO, and for at least a decade the plaque identifying the entrance
to GATT headquarters in Geneva read “Interim Commission for the International
Trade Organization.” It was designed primarily to lower commercial tariffs among
a restricted number of states—slightly more than forty in 1963—and operated
according to a very basic principle: Extending to all “contracting parties” who
signed the agreement the coveted “most favored nation” status, so that all signato-
ries conceded to all other GATT members the same conditions offered to the
nation with which it had the lowest trade barrier. In this way, GATT used a
wedge of trade multilateralism to pry open a world which had been dominated
since the 1930s by protectionism and bilateral trade relationships.
Midway through the 1950s, despite the creation of these three international eco-
nomic organizations, optimism did not reign in Washington. This much is clear
from the memoirs of Richard N. Gardner, a professor of economics and later a lead-
ing authority on international economic issues in the Johnson administration:
The International Monetary Fund was then largely inactive, bypassed by belated
efforts of postwar reconstruction. Sterling and the other major European currencies

64
R.N. Gardner, Sterling–Dollar Diplomacy in Current Perspective: The Origins and the Prospects of
Our International Economic Order (New York: Columbia University Press, 1980), p. 358.
65
T.W. Zeiler, Free Trade Free World: The Advent of GATT (Chapel Hill: University of North Caro-
lina Press, 1999), pp. 136–7.
66
On the Havana negotiations see M. Hart, Also Present at the Creation: Dana Wilgress and the
United Nations Conference on Trade and Employment at Havana (Ottawa: Center for Trade Policy and
Law, 1995).
67
M. Rainelli, Le Gatt (Paris: Editions La Découverte, 1993).
24 After Empires
were still inconvertible; of the International Monetary Fund permitting exchange
restrictions for a “transitional” period looked as if they might apply indefinitely. The
Charter for an International Trade Organization had been withdrawn from the Con-
gress; the General Agreement on Tariffs and Trade seemed too weak to organize an
effective attack on trade barriers. The recipients of the Marshall aid were preoccupied
with removing quantitative restrictions among themselves; the United States was
undermining its commitment to liberal trade with a variety of protectionist practices;
the outlook for substantial reductions in trade barriers on a global basis seemed highly
uncertain. International economic cooperation was obstructed by a huge American
trade surplus—the supposed chronic “dollar shortage”—and by divergent approaches
to domestic planning and full employment.68
The Third World countries could count, it is true, on a certain consistency in their
growth rates, but their overall weight in international trade was in steady decline.
Their power in the governing institutions of the international economy was largely
insignificant: If anything, the system was evolving from one in which only three
countries—France, Great Britain, and the United States—decided everything to
one in which the other western European powers, above all the Federal Republic
of Germany, were making their presence felt. Changes in international economic
regulation were clearly necessary to make democracy and market economy a more
attractive proposition. But how, and to what end?
To answer this question we must take a step back and examine the ferment of
new ideas brewing around questions of “development” and “growth” that would
become the buzzwords among the elites of the industrialized Western economies
during the 1960s. John Kenneth Galbraith, liberal intellectual par excellence,
recalled that immediately after the Second World War he asked his university,
Harvard, to institute a course on development. His request fell on deaf ears. Before
long the Anglo-American academic world would change radically. The very same
Galbraith noted that in the 1960s “no economic subject so quickly captured the
attention of so many people as the topic of the liberation from poverty of the peo-
ples of the poor nations.”69
Certainly the memory of the Depression of the 1930s played an important
role in the waning of classical liberal principles, demonstrating the weakness of
the self-regulating market, as did the precariousness of an international mone-
tary system based on the gold standard. Such views were largely due to the
belated acceptance of the ideas of Keynes;70 the Cambridge economist had pre-
dicted the inability of the self-regulating market to resolve the dilemma of
a country faced with insufficient foreign investment and a weak domestic
market—precisely the situation confronting the vast majority of developing
countries. The point to note here is that a group of noncommunist intellectuals,
though still a minority, had begun to seriously examine the question of growth

68
Gardner, Sterling–Dollar Diplomacy, p. xvi.
69
J.K. Galbraith, The Nature of Mass Poverty (Cambridge, MA: Harvard University Press, 1979),
p. 19.
70
F. Volpi, Introduzione all’economia dello sviluppo (Milan: FrancoAngeli, 1994), p. 30.
 The Third World and the Creation of UNCTAD 25

by the 1950s. These intellectuals understood that the underdeveloped countries

found themselves in dire straits not because of the primitive nature of their cul-
ture and habits but for a variety of different reasons: Because they lacked capital;
because more advanced industries had ever less need for some of their raw mate-
rials; because they lacked an entrepreneurial class; or because they found it dif-
ficult to make the transition from a primarily agricultural economy. Thus a
segment of the intellectual and academic world, especially but not exclusively in
the United States, began to consider the problems of Third World development
a subject worthy of study. As Tony Killick notes, the 1950s was the decade of the
great theories of economic growth:
Rosenstein-Rodan’s 1943 article perhaps marked the starting point and, of course,
earlier writers, especially in the classical period, were also much concerned with devel-
opment. Keynes and (as will be shown) Schumpeter were also particularly influential
on later writers. But development economics “took off” in the fifties, beginning per-
haps with the UN’s Measures for the Development of Underdeveloped Countries (1951)
and including major works by Nurske (1953), Lewis (1954 and 1955), Scitowsky
(1954), Myrdal (1956, 1957) and Hirschman (1958). This period of “grand theoris-
ing”, strongly marked by the boldness of its ideas, might conveniently be said to have
concluded with Rostow’s Stages of Economic Growth (1960), with Prebisch’s 1964
UNCTAD document seen as a late entry into the field.71
Of all these theories—in the development of which, it should be noted, academics
from the the continental European countries had a scant role—two would acquire
lasting significance for their impact on international politics, because they were
adopted as theoretical frameworks by leaders in either the developed or noncom-
munist developing world: Among the latter, the “structuralist” or “dependence”
theory promoted primarily by the Economic Commission for Latin America
(CEPAL, in the Spanish acronym used most frequently) based in Santiago, Chile,
and headed by the Argentine economist Raúl Prebisch; among the former, the
theory of “modernization” and “stages of growth” developed by economists at MIT
in Boston and most commonly associated with the name of Walt Rostow.
Prebisch first rose to international prominence as the director of CEPAL, cre-
ated in 1948 as one of the United Nations’s regional economic organizations.72 The
choice of Prebisch to run the organization was a felicitous one, which immediately
gave CEPAL global visibility. At age 25 he had already received a teaching appoint-
ment at the University of Buenos Aires, and by 29 he was made an economic advi-
sor to the Argentine Prime Minister; he was later named Undersecretary of Industry,
and at 34 was charged with reorganizing Argentina’s Central Bank. A voracious

71
T. Killick, Development Economics in Action: A Study of the Economic Policies of Ghana (London:
Heinemann, 1978), p. 29.
72
For an excellent biography of Prebisch, see E.J. Dosman, The Life and Times of Raúl Prebisch,
1901–1986 (Montreal: McGill–Queen’s University Press, 2009). One good work, based primarily on
interviews with Prebisch himself, is N. Gonzalez and D. Pollock, “Del ortodoxo al conservador
ilustrado: Raúl Prebisch en la Argentina, 1923–1943,” (1991) 30(120) Desarrollo Economico: Rivista
de Ciencias Sociales, pp. 455–86.
26 After Empires

reader of classical economic theory, from Adam Smith to John Stuart Mill, but also
of Marx, the most lasting impression on his thought would seem to have been left
by the sad spectacle of the international monetary and economic conference held
in London in 1933. On that occasion, the world powers had blocked Keynes’s
most innovative proposals and failed to halt the downward spiral of recession and
economic protectionism, all while the smaller nations—among them Argentina, in
whose delegation Prebisch took part—were invited as mere observers. One finds
clear expression of the basis for Prebisch’s thought in a short text, prepared in 1949
for the first conference of CEPAL in Cuba and published by the UN in April 1950
with the title Economic Study of Latin America and Some of its Principal Problems.
Here, he wrote that the heart of the problem of underdevelopment lay in the fact
that international commerce was based on an inequality of relations: On one side,
the developed nations traded primarily manufactured goods produced by an oli-
gopoly of large businesses, while on the other the developing nations exported raw
materials on a highly competitive free market. This meant that, while innovation
in the manufacturing sector translated into rising prices on the market and
improvement in the living conditions of Western workers, a similar innovation of
productivity for commodity producers resulted in a lowering of prices on the world
market and the consequent impoverishment of its laborers. The logical conclusion
was that international trade led to the systematic poverty of commodity-producing
countries—hence the terms “structuralist” or “dependency” theory—to the advan-
tage of the industrialized nations.73 In the course of the 1960s and 1970s, scholars
picking up on elements of Prebisch’s ideas would push dependency theory to its
logical conclusions, for instance in the work of Andre Gunder Frank, who argued
that it was only thanks to the brutal exploitation of the South that the industrial-
ized North could guarantee its elevated levels of economic growth. Dependency
theory here slipped into a theory of imperialism, which carried an implication that
Prebisch never raised and probably would have opposed: A revolutionary subver-
sion of the world order.74
It should come as no surprise that Latin America produced the first criticisms
leveled squarely at the mechanisms of the international economy. Latin American
countries had been among the first to achieve political independence in the course
of the nineteenth century, and while they had on occasion been able to leverage
this position, they were well acquainted with the lack of bargaining power charac-
teristic of countries, particularly exporters of raw materials, at the periphery of the
international economy.75 Latin American countries reacted to the crisis of the
1930s by investing in the growth of national industries capable of substituting for

73
R. Prebisch, “Sobre desarrollo y politica commercial internacional,” in Justicia Economica Inter-
nacional: Contribucion al estudio de la Carta de Derechos y Deberes Economicos de los Estados (Mexico:
Fondo de cultura economica, 1975).
74
For a brief discussion of the evolution of dependence theory, see G. Lundestad, East, West, North,
South (Oxford: Oxford University Press, 1999); G. Rist, The History of Development: From Western
Origins to Global Faith (London: Zed Books, 1997).
75
C. Furtado, Economic Development of Latin America: Historical Background and Contemporary
Problems (Cambridge: Cambridge University Press, 1976), p. 54.
 The Third World and the Creation of UNCTAD 27

imports from more developed countries.76 As early as 1948, Venezuela became the
first oil-producing country to impose a 50/50 profit sharing mechanism for oil
concessions on the oil multinationals. In practice, this economic nationalism was
rather successful: By the 1940s the majority of Latin American countries were
highly urbanized, with one-fifth of their workers in the manufacturing sector—a
level reached by the United States in 1890—and some (notably Argentina) had
fully or partially nationalized their large industries and service sector.77 The con-
struction of Brasilia in a few short years from 1956 to 1960, a completely new and
futuristic capital city (as evidenced by its visionary modernist architecture), pro-
vided ample evidence of this restless faith in modernity. Import substitution, it was
thought, financed by the income from trade in commodities, would help stimulate
further industrialization, which would in turn offer greater employment for new
immigrants to the cities and promote modernization in all sectors, from transpor-
tation to distribution. For all this to be possible, however, it was necessary to
improve the terms of exchange between commodities and manufactured goods in
favor of the former.
The other major theory we have mentioned, that of “modernization,” was con-
ceived by a circle of economists known as the “Charles River group”—after the
river that winds its way through Boston (home of MIT)—as a tool to halt com-
munism’s advance in the Third World. The two most important members of the
group, Walt Rostow and Max Millikan, had been members of the Office of Stra-
tegic Services (OSS), the army intelligence service that was the predecessor of the
CIA, during the Second World War. Until 1952 Millikan, in fact, had been the
director of the CIA’s International Economic Section, and the Center for Interna-
tional Studies, their intellectual base of operations at MIT, received direct financ-
ing from the Agency.78 Rostow would go on to become National Security Advisor
under President Lyndon Johnson, and one of the most tenacious defenders of
military engagement in Vietnam. His most important work, The Stages of Eco-
nomic Growth, which appeared in 1960 with the subtitle A Non-Communist Man-
ifesto,79 established the concept of “take-off ”: An explosive burst of economic
growth that could only be made possible in the countries of the South by under-
taking specific internal-structural reforms, which meant the opening of markets,
freedom of competition, and, obviously, democratization. No mention was made,

76
Discussions on industrialization were joined with the idea of internal social change directed
primarily at the class of latifondisti, with little regard for investment or the necessity for a redistribu-
tion of wealth that would enlarge the middle class and, with it, the potential domestic market for
industrially produced goods. M. Plana and A. Trento, L’America Latina nel XX secolo (Florence: Ponte
alle Grazie, 1992), p. 101.
77
J.A. Frieden, Global Capitalism: Its Fall and Rise in the Twentieth Century (New York: W.W. Norton
& Co., 2006), p. 304.
78
G. Rosen, Western Economists and Eastern Societies: Agents of Social Change in South Asia 1950–1970
(Baltimore, MD: Johns Hopkins University Press, 1985).
79
In Italy the book appeared without this subtitle, which would have rendered it extremely unpop-
ular, in particular among the left-leaning readership of Einaudi, the Turin editing house that published
it, many of whom were close to the Communist Party of Italy. W. Rostow, Gli stadi dello sviluppo
economico (Turin: Einaudi, 1962).
28 After Empires

for obvious reasons, of colonialism’s role in contributing to the different stages of

growth reached by empires and their former colonies. Translated around the
world, this brief essay, which purported to explain the distinct historic phases of
economic development, presented itself as an objective scientific analysis. In real-
ity, of course, it was part of a precise foreign policy platform centered on peaceful
persuasion rather than brute military force; indeed, the first version of the essay,
published in 1957, carried the revealing title A Proposal: Key to an Effective Foreign
Policy.80
By the end of the 1950s, economic growth had become the primary focus of the
industrialized world and, considering the West’s recent success in this regard, many
of its most prominent economists began to believe they had discovered a magic
formula. According to Mark Mazower:
We can chart the development of the new creed fairly precisely. In the 1950s, the
annual reports of the new OEEC (the Organization for European Economic Coop-
eration) spotlighted the need to improve productivity as the key to expansion. In 1956
it used the phrase “economic growth” for the first time. When the organization was
refounded in 1960 as OECD, article I of its founding charter stated that the organiza-
tion “aimed to achieve the highest sustainable growth and employment of standard of
living in Member countries.” In Walt Rostow’s The Stages of Economic Growth . . . the
growth creed acquired its gospel.81
With the election of John F. Kennedy, a president with strong ties to the liberal
intellectual world, the “Charles River approach” became the unquestioned orienta-
tion of American foreign policy, as White House Special Assistant Arthur Schles-
inger Jr. recalled:
In this view foreign aid, instead of being a State Department slush fund to influence
tactical situations, should aim at the strategic goals of stronger national independence,
an increased concentration on domestic affairs, greater democracy and long-run asso-
ciation with the West.82
This new strategic direction, far from implying a diminishing importance for US
military aid—which at the end of the 1950s was four times greater than civilian
assistance—aimed to prove that economic growth and democracy could go hand in
hand, and often resulted in an increase in aid “linked” to the import of American

80
W. Rostow and M. Millikan, A Proposal: Key to an Effective Foreign Policy (New York: Harper and
Brothers, 1957). On the way in which Rostow’s thesis engaged the need to counter the influence of
communist thought Gilbert Rist wrote:
The problem was twofold: it had to be shown, mainly by reference to European economic history,
how the recently decolonized countries might in turn promote growth leading to “development”;
and it had to be explained why communism, far from making it possible to achieve this objective,
was actually “a kind of disease which can befall a transitional society if it fails to organize effectively
those elements within it which are prepared to get on with the job of modernization”.
Rist, The History of Development, p. 94.
81
Mazower, Dark Continent, p. 301.
82
A.M. Schlesinger, A Thousand Days: John F. Kennedy in the White House (New York: Fawcett
Premier, 1966), p. 468.
 The Third World and the Creation of UNCTAD 29

goods.83 In 1960 the International Development Association (IDA) was created as

a new World Bank tool to finance long-term development programs at more advan-
tageous terms, a technique which would earn the name “soft loans.” Until 1963
Eugene Black, the World Bank President, had refused to change the conditions for
the Bank’s loans, with the backing of the European executive directors who repre-
sented the Board’s most conservative nucleus, despite an increasingly obvious lack
of opportunities for investment. The new president nominated in 1963, George
Woods, courageously declared that underdevelopment was not entirely the respon-
sibility of the poor nations, that among its causes were low commodity prices as well
as the trade barriers erected by the developed countries, and that it was absurd that
an institution designed to support development should consistently run significant
surpluses. The Bank slowly began to extend loans to the agricultural and industrial
sectors, though initially concentrated primarily in Asia, and in particular India and
Pakistan, where some 69 percent of all loans were allocated. The creation of the IDA
also helped to dissuade Third World countries from continuing to call for the crea-
tion of a new development agency under the auspices of the UN, where they held a
majority: SUNFED (Special United Nations Fund for Economic Development)
remained in fact completely marginalized among the organizations charged with
the allocation of aid. Bilateral assistance remained, at any rate, the primary tool by
which aid was distributed from the industrialized world to the South, though by
1970 it had shrunk from 54.2 percent of the total to 38 percent.84
The other initiative launched by the Kennedy administration was the Alliance
for Progress, unveiled at Punta del Este in 1960. This announcement committed
the United States to investing $20 billion in Latin America over the course of the
next decade to encourage a series of economic and social measures, primarily lit-
eracy and more equitable land distribution. The initiative was undertaken in part
as a reaction to the failure of military intervention in Cuba, out of the fear that
revolt could spread across the South American continent. The Alliance was, in
retrospect, recognized even by Castro as an “astute” response to the Bay of Pigs
fiasco:
Kennedy proposed, after the defeat at Girón [the Bay of Pigs], an “Alliance for
Progress,” plus the Peace Corps, a very astute strategy for putting the brakes on
revolution . . .
In the end, many Latin American rulers stole all the money they could and the Alli-
ance for Progress didn’t solve a thing. Still, it was an intelligent reaction on Kennedy’s
part—he was a man of unquestionable intelligence.85
The Alliance was successful in temporarily isolating the Cuban socialist experi-
ment, but failed to silence the criticism of those who had not forgotten Guatemala,
or those who pointed out how the Alliance, by rewarding private capital, would in

83
R.A. Packenham, Liberal America and the Third World (Princeton, NJ: Princeton University
Press, 1973), p. 59.
84
Wood, From Marshall Plan to Debt Crisis, p. 82.
85
F. Castro and I. Ramonet, My Life: A Spoken Autobiography, trans. Andrew Hurley (New York:
Scribner, 2008), p. 270.
30 After Empires

essence only help to boost the investments of American multinationals in Latin

America.86
Kennedy also echoed his message of “growth,” “development,” and “moderniza-
tion” in his relations with America’s transatlantic partners. In 1960, as we have
seen, the creation of the Organization for Economic Cooperation and Develop-
ment (OECD) was supposed to establish a mechanism for joint policy coordina-
tion. Within the OECD, the Development Assistance Commission (DAC) was
also supposed to guarantee greater cooperation between the industrialized nations
on questions of assistance to the Third World, so that European aid would not be
granted for motives of national interest or mercantilist expansion, but as part of a
coordinated free-market and anticommunist struggle. The other element designed
to consolidate the transatlantic partnership was the opening of another GATT
round of tariff reductions, concentrated on both manufactures and agricultural
goods, where the United States feared European protectionism.87
In sum, American reshaping of the international economy rested on three pillars.
First, the USA encouraged modernization through the stimulus of private enter-
prise in the Third World and the reform of international aid institutions in order to
block the expansion of socialist planned economies and state-run industries. Sec-
ond, it supported renewed collaboration with western Europe to prevent those
nations from shirking their responsibilities in the global war on communism by
walling themselves off with preferential trade relationships in certain parts of the
globe. Third, after the demise of quantitative trade restrictions among the EEC
countries, Washington launched a new trade round between Europe and the United
States that was supposed to benefit American exports to the Old Continent.

U N I O N I Z I N G T H E T H I R D WO R L D : T H E G 7 7
A N D T H E O R I G I N S O F U N C TA D

Kennedy’s efforts to reshape the international economy, however, like those we have
just described to institute a new foreign aid policy for developing nations, did not
account for the growing radicalization of the Third World, even outside Latin
America. Many in these areas had begun to view the end of direct military rule over
the former colonies as insufficient, and were slowly becoming convinced of the
legitimacy of a battle to achieve the same standards of living enjoyed by the indus-
trialized nations: High levels of technological development, cultural and social
advancement, and rising life expectancy. From the political and military struggle for
independence, the fight against economic “neocolonialism” was born. The order of
the day among those newly independent nations, seeking to escape the tutelage of
the developed world, was “trade not aid”: Growth in trade with the industrialized

86
G. Selser, Alianza para el Progreso. La Mal Nacida (Buenos Aires: Ediciones Iguazú, 1964).
87
F.L. Block, The Origins of International Economic Disorder: A Study of United States Interna-
tional Monetary Policy from World War II to the Present (Berkeley: University of California Press, 1977),
p. 172.
 The Third World and the Creation of UNCTAD 31

economies, accompanied by changes to the rules of international commerce and

increased prices for raw materials, was thus linked to their desire to break out of the
vicious cycle of dependence hidden beneath the benevolent face of foreign aid.88
At the forefront of these radicals was the Egypt of Nasser, who had come away
from the Suez crisis with enormous prestige throughout the Arab world.89 His
announcement, broadcast by radio across Europe on July 23, 1956, that the Suez
Canal had been nationalized and that it would be Egyptian technicians, and not
foreigners, who thenceforth would guarantee the regular passage of ships through
the strait, was memorable for the insolent jubilance of his laughter. The son of a
postman—the first symbol of the efficient modern state—Nasser thought he could
play the superpowers off against one another in the search for financial and techni-
cal support, establishing a trend imitated by other Middle Eastern leaders.90 He
believed that only economic planning along socialist lines, married to a confedera-
tion of Arab socialist republics, could secure the share of world markets, returns on
investment, and a minimum of “living space” to give his leadership adequate
breathing room.91 But following closely behind the Egyptian president were several
leaders from an Africa suddenly alive with new political ideas, many of whom were
beginning to believe that direct rule by the former colonial powers was slowly giv-
ing way to another, more insidious form of domination based on international
capital’s control of the levers of the world economy and big businesses engaged in
the extraction of raw materials. One of the African leaders who fulminated
most vigorously against neocolonialism was Ghana’s Kwame Nkrumah. Certain
elements of his thought were shared and indeed discussed with Western specialists
on development, from Arthur Lewis to Mary Kaldor, who argued for massive
industrial investment to break the cycle of dependence on the agricultural econ-
omy.92 Tony Killick underlined the importance of the choices confronting African
leaders:
One may sometimes wonder if the Western Powers fully understand the dilemma fac-
ing political leaders in the emergent lands. They have gained independence for their
peoples. The hazards and the excitements of the struggle lie behind. Ahead lies the
workaday world in which people must live and eat and hope and prosper. Independ-
ence of itself does not change this world. It simply creates the right political atmos-
phere for a real effort of national regeneration.93

88
This book interprets the fight of the Third World to change the rules of international trade, and
obtain greater influence in the Bretton Woods institutions, as a struggle that cannot be explained fully
in terms of the pressures of the Cold War. An alternative interpretation views the developing countries
as the puppets of international communism, which masked its expansionist designs in the guise of
peaceful competition, nuclear disarmament, freedom from unequal trade relations, and close ties with
the Third World. See B. Crozier, The Struggle for the Third World: A Background Book (London: The
Bodley Head, 1966).
89
D. Hopwood, Egypt, Politics and Society 1945–1984 (London: Allen & Unwin, 1985), pp. 43–4.
90
M. Trentin, Engineers of Modern Development. East German Experts in Ba’athist Syria: 1965–1972
(Padua: Cluep, 2010).
91
R. Schulze, A Modern History of the Islamic World (New York: New York University Press, 2002),
pp. 151–3.
92
P. Nugent, Africa since Indepdendence (New York: Palgrave, 2004), p. 170.
93
Killick, Development economics, p. 49.
32 After Empires

Nkrumah’s essay Neo-Colonialism: The Last Stage of Imperialism—the title para-

phrases Lenin in 1917—described economic dependence as part of a precise
political strategy by the ex-colonial powers based on “breaking up former large
united colonial territories into a number of small non-viable States which are
incapable of independent development and must rely upon the former imperial
power for defence and even internal security.”94 Nkrumah was critical of the
creation of African states dependent on their ex-colonial masters, though he saw
de Gaulle’s France as a potentially useful obstacle to the creation of a larger and
united Western system of exploitation. He was one of the principal supporters of
the idea of an African federation of states, which had its moment in the spotlight
in 1963 with the creation of the Organization of African Unity—a body that, it
must be noted, ultimately failed to fulfill Nkrumah’s ambition to eliminate colo-
nial states altogether.95 The Ghanaian leader considered economic neocolonial-
ism a system based on the collapse of commodity prices, loans at high interest, a
multilateral aid system that emphasized potential return on investment, and the
trade and maritime transport monopolies enjoyed by the wealthiest nations. In
his view, the “free” trade unions of the industrialized world were another instru-
ment of neocolonialism, above all those affiliated with the British Labour Party,
since their demands imposed constant price increases for Western manufactures
while insisting on the protection of industrialized nations’ domestic markets.
A General Electric commercial of the period that invited viewers to invest in the
company’s shares offered a concrete image of the “predatory” reality that Nkru-
mah described:
A General Electric advertisement carried in the March/April 1962 issue of Modern
Government informs us that “from the heart of Africa to the hearths of the world’s steel
mills comes ore for stronger steel rails”. With this steel from Africa, General Electric
supplies transportation for bringing out another valuable mineral for its own use and
that of other great imperialist exploiters. . . . But is it for Africa’s needs? Not at all. The
site, which is “being developed by the French concern, Compagnie Minière de
l’Ogooue, is located on the upper reach of the Ogooue River in the Gabon Republic.
After the ore is mined it will first be carried 50 miles by cableway. Then it will be
transferred to ore cars and hauled 300 miles by diesel-electric locomotives to the port
of Point Noire for shipment to the world’s steel mills.” For “the world” read the United
States first and France second.96

94
K. Nkrumah, Neo-Colonialism: The Last Stage of Imperialism (London: Thomas Nelson & Sons,
1965), p. xiii.
95
On the failure of the OAU, see M. Michel, “Les réactions francophones et anglophones face aux
premiers regroupements africains,” in C.R. Ageron and M. Michel, eds, L’ère des décolonisations (Paris:
Editions Karthala, 1995), pp. 280–95.
Until 1963 pressures for a regional solution to the problem of African underdevelopment seemed
much greater than those which would push for privileged relationships between Europe and
Africa. But circumstances would change quickly. See G. Migani, “La Communauté économique
européene et la Commission économique pour l’Afrique de l’ONU: la difficile convergence de
deux projets de développement pour le continent africain (1958–1963),” (2007) 13 Journal of
European Integration History, pp. 133–46.
96
Nkrumah, Neo-Colonialism, p. 14.
 The Third World and the Creation of UNCTAD 33

Such criticisms, which emphasized the obstructionism of the industrialized states,

were also spread by the Marxist analyses of the American publication Monthly
Review, directed by Paul Baran and Paul Sweezy. In these circles, formally inde-
pendent from international communism, it was not uncommon to hear the use of
the term “imperialism” with growing frequency in reference to the policies of the
industrialized nations toward the Third World. Their ideas had a degree of influ-
ence over Third World leaders, like Guyana’s Cheddi Jagan who, while declaring
himself a social democrat, admitted in conversation with a skeptical Kennedy that
he was an assiduous reader of the Review.97
The ex-colonial states sought to rebuild a viable identity and to construct con-
crete symbols of their independence not just economically but culturally. This was
particularly true of the Senegalese leader Leopold Senghor, who developed the
concept of négritude and sought a path to African socialism that did not adhere
strictly to the writings of Marx, but was autonomous, collectivist, and not neces-
sarily hostile to Europe. Such was also the position of Frantz Fanon, the physician
from Martinique turned combatant in the Algerian war of liberation, who con-
ceived of the search for identity—in contrast to Senghor—as a process of rejecting
Western culture. In The Wretched of the Earth, first published in 1961 and soon to
become the manifesto of “Thirdworldism” even in western Europe, Fanon passion-
ately asserted the need to fight for the redistribution of resources in favor of colo-
nized peoples:
The fundamental duel which seemed to be that between colonialism and anticolonial-
ism, and indeed between capitalism and socialism, is already losing some of its impor-
tance. What counts today, the question which is looming on the horizon, is the need
for a redistribution of wealth . . .
In the same way we may say that the imperialist states would make a great mistake
and commit an unspeakable injustice if they contented themselves with withdrawing
from our soil the military cohorts, and the administrative and managerial services
whose function it was to discover the wealth of the country, to extract it and to send
it off to the mother countries. We are not blinded by the moral reparation of national
independence; nor are we fed by it. The wealth of the imperial countries is our wealth
too . . . From all these continents [Latin America, China, and Africa], under whose eyes
Europe today raises up her tower of opulence, there has flowed out for centuries
toward that same Europe diamonds and oil, silk and cotton, wood and exotic prod-
ucts. Europe is literally the creation of the Third World.98
To understand the seemingly intractable economic obstacles facing the newly inde-
pendent Asian, African, and Latin American states, the observations formulated in
the 1970s by Paul Bairoch are still useful.99 He was among the first to take note of
these nations’ growth in gross domestic product, and the development of certain
important social indicators like rates of education, in the two decades from 1950

97
Packenham, Liberal America, p. 78. For a good synthesis of the principal theories in this area, see
T. Kemp, Theories of Imperialism (London: Dobson, 1967).
98
F. Fanon, The Wretched of the Earth (New York: Grove Press, 1963), pp. 98–102.
99
P. Bairoch, Rivoluzione industriale e sottosviluppo (Turin: Einaudi, 1967), pp. 216–17.
34 After Empires

to 1970. At the same time, Bairoch argued that the absence of certain factors
present in the European nations of the First and Second Industrial Revolutions of
the nineteenth century actually militated against growth in the poor countries, and
trapped them in a vicious circle that caused them to sink even further into relative
underdevelopment:
1. the fact that manufacturing processes had become much more complex,
making it much more difficult to introduce or copy industrial production
techniques in places still dominated by artisanal modes of production;
2. the decrease in transportation costs that made it possible to do the previously
unthinkable, that is to maintain manufacturing plants far from the producer
nations of raw materials; and
3. the demographic explosion of the Southern nations, which could not sustain
levels of agricultural production sufficient to feed their people, notwith-
standing the productive revolution in farming techniques.
Already by the beginning of the 1960s, the most perceptive economic historians
were emphasizing how simple imitation of the model followed by the industrial-
ized countries—the idea put forward by the Rostowians—would not raise the poor
countries out of their poverty, because they would simply fall prey to sabotage or
outright corruption by established elites.100
Although rarely mentioned by historians, the creation in 1960 of the Organiza-
tion of Petroleum Exporting Countries (OPEC), the first and most crucial organi-
zation among producers of raw materials, should also be viewed as a vital element
of the Third World’s new activism and of the increasingly global reach of some of its
ideas. Far from being an Arab gathering, it included Iran and extended its global
reach to the nationalist and interventionist governments of Indonesia and Vene-
zuela. The gentleman’s agreement leading to the creation of OPEC was reached in
1959 at the margins of the First Arab Petroleum Congress in Cairo, with a hand-
shake between the Venezuelan Oil Minister Pérez Alfonzo and the Saudi Director of
Petroleum and Mineral Affairs Abdullah al-Tariki (soon to become that nation’s first
Oil Minister). Venezuelan diplomats had been trying since at least the 1950s to
blunt competition with cheaper Middle Eastern oil by reaching some form of effec-
tive agreement on oil production and prices, but were initially quite skeptical that
the proposed organization would prove a success. As the Venezuelan ambassador
commented regarding his meeting with the Saudi Prince Faisal, “it seems that the
main producer in the Arab world does not share our concepts and that, considering
its position, it could very well soon become a terrible competitor.”101 Eventually, the
fateful decision by the oil companies in 1959 to decrease the posted price for oil (the
reference price on which the taxation and income of oil-producing countries was

100
W. Kula, The Problems and Methods of Economic History, 2nd edn (Burlington, VT: Ashgate,
2001), p. 435.
101
Archivo Histórico Ministerio del Poder Popular para Relaciones Exteriores (AHMPPRE), Ara-
bia Saudita, Situación Política, 1960, Embajador Antonio Araujo, “Entrevista con el Príncipe Hered-
ero Faisal, en Arabia Saudita,” Cairo, March 31, 1960.
 The Third World and the Creation of UNCTAD 35

determined), created the favorable climate for OPEC to be formally constituted in

1960 in Baghdad, at a meeting that went completely unnoticed by the foreign press
and major leaders at the time.102
The ongoing cultural ferment in the Third World formed a more tangible part of
the background to the July 1962 Cairo Conference on Problems of Economic Devel-
opment, following up on decisions made the year before at the Belgrade meeting of
the non-aligned countries. Some thirty-six nations representing the three major
regions of the global South participated at the conference, which witnessed a tighten-
ing of bonds between the Afro-Asian founders of the Non-Aligned Movement, the
most radical African leaders who advocated a harder line in the struggle against neo-
colonialism, and the Latin American nations most experienced at criticizing the role
of international economic institutions while working with them.103 With the Cairo
Declaration, approved with the active support of Raúl Prebisch—invited as a repre-
sentative of the United Nations—the developing countries presented a resolution in
support of a new UN conference on “all vital questions relating to international
trade, primary commodity trade, [and] economic relations between developing and
developed countries.” In the course of discussions a common viewpoint had clearly
emerged: Trade was considered the primary motor of development, and the privi-
leged economic relationships among the developed countries, or between them and
the poorer nations, an unjust instrument of pressure or discrimination. It did not
take long for French diplomats, who had requested that their African allies refrain
from participating at Cairo, to foresee a situation in which the European Economic
Community could find itself the target of heavy fire from these “rebels”:
The Cairo Declaration contains a number of criticisms directed at “regional economic
groups,” which, it is known, means above all the European Economic Community.
The hostile attitude of the Cairo meeting to the Common Market was otherwise so
marked that France was compelled to advise the AASM nations [the Association of the
African States and Madagascar] not to participate at the conference, with the result
that the majority of the associated nations refused to send representation.104
The path to this new forum, which would become the United Nations Conference
for Trade and Development (UNCTAD), was outlined on August 1, 1962 in a
resolution of the UN Economic and Social Council, and subsequently confirmed
on December 8 by the General Assembly. All the EEC nations with the exception
of the Netherlands voted against the convocation of the conference.105 Several

102
J.C. Boué, “OPEC at (More Than) Fifty: The Long Road to Baghdad, and Beyond,” (2010) 83
Oxford Energy Forum.
103
UNCTAD, The History of UNCTAD 1964–1984 (Geneva: United Nations, 1985).
104
Historical Archives of the European Union (HAEU), Conseil des Ministères (CM) 2/1964,
830, “Répresentation permanente de la France, Note,” December 4, 1962.
105
Archives du Ministère des Affaires Etrangères Françaises (AMAEF), Nations Unies et Organisa-
tions Internationales (NUOI), Direction des Affaires Economiques et Financières, “Projet de Con-
férence Commerciale Mondiale,” September 24, 1962: “What is certain is that, beyond the occasion
that this conference will provide to place a large number of nations against the Common Market, the
risk is that it will also put up for discussion the development of GATT, if it is true that, as claimed by
the USSR, the conference will demand the creation of a global trade organization.”
36 After Empires

factors contributed to the success of the Third World initiative.106 First there was
the general disenchantment with the functioning of the UN Economic and Social
Council (ECOSOC). Second was the general inattention paid to the development
requirements by the World Bank and the IMF, and the complete lack of an inter-
national organization to deal with commodities and foreign investment. In
addition, as we have noted, since the death of Stalin the Soviet Union had
begun to treat the United Nations as a forum for global propaganda; after
having opposed the Havana Charter in 1948 it gradually changed course, even-
tually supporting the idea of the creation of a World Trade Organization. This
was seen as a way of breaking the Western monopoly over international eco-
nomic institutions and at the same time of weakening the EEC, which had in the
meantime become one of the primary targets of Soviet attacks. Finally, and most
significantly, after the admission of seventeen new nations—all from Africa—the
vote of the General Assembly in favor of the conference was a foregone conclusion.
There could be nothing to do but accept it.
The next step was to create a preparatory committee for Geneva—quickly
dubbed by the international press the “GATTicide Committee”—which would
meet three times to agree upon conference details. The European Community used
these meetings, as we shall see in the next chapter, as a forum to defend itself from
the inevitable pressure which the conference would produce, ensuring that the
conference would not take place before 1964, and thus that Geneva would not
interfere with the finalization and ratification of the Yaoundé Convention treaty
with the AASM.
The preparatory committee was the place where, for the first time, the economic
solidarity of the developing nations took concrete organizational form. This nas-
cent solidarity was in many ways unexpected, even in the experienced and some-
what jaded eyes of the diplomats in the British Foreign Office:
The main impression left one of slowly gathering momentum and of greater co-ordi-
nation between less-developed countries. The movement is still uncertain and stum-
bling but it is better in control than during the first session and it seems to have caught
some of the more developed countries slightly off balance, and induced them to mod-
ify the main idea with which they came to the conference.
Inevitably the European Economic Community was the main target for criticism
because its policies have tended to accentuate processes which are apparent in the
trade of all developed countries with those at a lesser degree of development.107
At the second meeting of the preparatory committee, the developing countries
presented a joint declaration on anticipated voting procedures, later submitted to
the General Assembly with the signatures of seventy-five nations.
Two additional signatories were added at the end of the Geneva Conference,
making a total of seventy-seven: Thus was born the Group of 77 (G77), a name

106
R.N Gardner and M.F. Millikan, The Global Parntership: International Agencies and Economic
Development (New York: Praeger, 1968), p. 99.
107
National Archives (NA), Foreign Office (FO) 371/172276, Telegram, “Preparatory Committee
for the United Nations Conference for Trade and Development,” July 3, 1963.
 83 81 82 107
31 33 86 84 85 89 9098 99
0 104 105 108
32 34 88 93 10
3 35 91
2 94
1 96 102 109

The Third World and the Creation of UNCTAD

37 38 39 57 92 106
8 4 5 6 42 40 95 111
7 36 49 41 110
9 10 13 43 53 97 112
18 48 56 101
1112 15 14 44 45 55 115 113
19 54 58 103 116 114

21
20 16 46 47 50 52 64

22
65
17 59 51 61
63 66
23 60 70 117
68 67
62 119
25 76 69 118
121 24 75 74
26
78 73 71 120
27 77 72
28

29 30 79
80

1. Mexico 16. Grenada 31. Morocco 46. Sierra Leone 61. Gabon 76. Angola 91. Saudi Arabia 106. Bangladesh
2. Cuba 17. Barbados 32. Algeria 47. Liberia 62. Congo 77. Botswana 92. Bahrain 107. North Korea
3. Bahamas 18. Trinidad and Tobago 33. Tunisia 48. Côte d’Ivoire 63. Zaire 78. Zimbabwe 93. Qatar 108. South Korea
4. Jamaica 19. Venezuela 34. Libya 49. Upper Volta 64. Uganda 79. Swaziland 94. United Arab Emirates 109. Myanmar
5. Haiti 20. Colombia 35. Egypt 50. Ghana 65. Kenya 80. Lesotho 95. Oman 110. Thailand
6. Dominican Republic 21. Guyana 36. Cape Verde 51. Togo 66. Rwanda 81. Yugoslavia 96. North Yemen 111. Laos
7. Guatemala 22. Suriname 37. Mauritania 52. Benin 67. Burundi 82. Romania 97. South Yemen 112. Vietnam
8. Honduras 23. Ecuador 38. Mali 53. Nigeria 68. Tanzania 83. Malta 98. Iran 113. Cambodia
9. El Salvador 24. Peru 39. Niger 54. Cameroon 69. Comoros 84. Cyprus 99. Afghanistan 114. Philippines
10. Nicaragua 25. Brazil 40. Chad 55. Central African Republic 70. Seychelles 85. Syria 100. Pakistan 115. Malaysia
11. Costa Rica 26. Bolivia 41. Sudan 56. Ethiopia 71. Madagascar 86. Lebanon 101. Maldives 116. Singapore
12. Panama 27. Paraguay 42. Senegal 57. Djibouti 72. Mauritius 87. PLO 102. India 117. Indonesia
13. Dominica 28. Chile 43. Gambia 58. Somalia 73. Mozambique 88. Jordan 103. Sri Lanka 118. Papua New Guinea
14. Saint Lucia 29. Argentina 44. Guinea Bissau 59. São Tomé and Principe 74. Malawi 89. Iraq 104. Nepal 119. Solomon Islands
15. Saint Vincent and 30. Uruguay 45. Guinea 60. Equatorial Guinea 75. Zambia 90. Kuwait 105. Bhutan 120. Fiji
Grenadines 121. Tonga Samoa

37
Figure 1.2. The G77 from its Origins to 1976. The countries in bold are founding members.
38 After Empires

that would stick, though in the future the number of associated countries would
grow steadily.108
The G77 that began to coalesce in 1963 would become a major actor in inter-
national economic negotiations until at least the end of the 1970s, something akin
to a trade union of Third World governments. Already at its birth the group was
divided between radicals—nations like Indonesia and Cuba, which regarded the
Conference as the first step in a global class conflict against the wealthy nations—
and pragmatists like India, which sought to use Geneva more concretely as a new
forum for international cooperation to work toward more short-term goals. It is
not easy to evaluate which of the G77 countries were best positioned to play a
front-line role in the negotiations; the relative size of the nations and the interna-
tional prestige accorded to individual leaders, like Nasser or Nehru, were certainly
important. But the practical preparations of the delegations and the charisma of
individual diplomats were equally significant, as in the case of the Brazilian Sil-
veira, as well as Lall from India, Stanovnik from Yugoslavia, Santa Cruz of Chile,
and Mahmood of Pakistan.109
No similar degree of cooperation was evident on the western front, which had
also begun preparations for the conference at the end of 1963 within the OECD.
Here the atmosphere was poisoned by tension, in particular that between the pro-
Atlantic powers and de Gaulle’s France, which in January 1963 had officially
rejected the British application to join the EEC.110 The Kennedy administration,
having pushed hard for British inclusion in the Community, regarded the newborn
Franco-German axis as little more than a front for domestic political self-
preservation, which would prevent Europe from assuming its international and
Atlantic responsibilities.111 In addition to the divisions within the Community,
the OECD negotiations also revealed diametrically opposed visions for the future
of global trade: While France supported price controls for basic commodities in
order to defend the Common Agricultural Policy (CAP), Great Britain appeared to
want to embark on a crusade for the complete liberalization of world commerce.112
The only point of genuine consensus to emerge among the Western powers was the
need to avoid the prospect of the Conference leading to the creation of a World
Trade Organization that would jeopardize the primacy and role of GATT.
In 1963 London presented a seven-point plan to reform GATT that would have
partially met the demands of the less developed countries (LDCs), agreeing to
some liberalization of the industrialized world’s markets. The plan was deemed
completely inadequate by the Belgian trade minister, Brasseur, in light of the more

108
K.P. Sauvant, The Group of 77 (London: Oceana Publications, 1981).
109
For an analysis of the G77 as well as an understanding of its internal dynamics, see B. Gosovic,
UNCTAD: Conflict and Compromise: The Third World’s Quest for an Equitable World Economic Order
through the United Nations (Leiden: A.W. Sijthoff, 1972).
110
P. Winand, Eisenhower, Kennedy, and the United States of Europe (London: Macmillan, 1993).
111
A French editorial also argued that the formation of the Franco-German axis raised the risk that
Europe would close itself off from international engagements: “Europe fermée, Europe ouverte?,” Le
Monde, January 24, 1963.
112
HAEU, High Authority of the ECSC (CEAB) 05, 1196/1, Note du Secrétariat Ocde, “Con-
férence des Nations Unies sur le Commerce et le Développement,” June 27, 1963.
 The Third World and the Creation of UNCTAD 39

radical requests then coming out of the developing world: The abolition of all
existing trade preferences; greater access to the markets of the developed world for
producers of raw materials and unfinished goods; abolition of agricultural protec-
tion; higher prices for basic commodities; abolition of quantitative restrictions,
quotas, and inverse preferences; regional privileges for the developing nations, in
contravention of GATT rules; safeguards on profits for exports; and price stabiliza-
tion for raw materials.113
One issue on which the Western nations found themselves in full agreement was
that Prebisch should not be allowed to assume the role of Secretary-General of
UNCTAD. Prebisch had tried, using all the means at his disposal, to undermine
GATT and remove it from its position of primacy in the oversight of international
trade.114 This time, their opposition would be in vain.
To understand the terms of the debate at the Geneva Conference it is necessary
to examine the Prebisch Report, distributed before the opening of the final phase of
negotiations.115 The final document was radical in its premise, yet apparently mod-
erate in its conclusions; so moderate, in fact, that some scholars would later attack
Prebisch and his followers for having recommended only minor concessions on
trade, while understating the need for radical changes in the internal dynamics of
the Southern countries.116 But the report was based on the sweeping premise that
the economic geography of the nineteenth century, based on profound inequalities
in international trade, should be officially recognized as a thing of the past:
The great depression precipitated the break-down of this old order, already under-
mined by the political impact of the First World War. In view of all this and of the
consequences of the Second World War, it is out of the question to think of restoring
the old order now. In the not too distant days of Havana it might have been possible
to harbour illusions of doing this, but the subsequent course of events has finally dis-
pelled these illusions once and for all . . . Today it is imperative to build a new order
with a view for solving the serious problems of trade and development that beset
the world.
These trade imbalances were the product of the same historic circumstances that
had made Great Britain the first industrialized nation. Prebisch limited himself to
examining the goals defined by the Decade of Development—the program
approved by the UN in 1960—which had as its objective the achievement of 5
percent annual growth rates in the poorer countries. He noted, however, that this
goal was wholly inadequate because, given the considerable growth in population
in the Third World, a 5 percent annual increase in GDP would actually amount to

113
HAEU, OECD 148, Council, “Statement by Mr. Brasseur, Belgian Minister for External Trade
and Technical Assistance, on the relations with countries in process of development,” Paris, November
20, 1963.
114
HAEU, CM2–1964, Note, “Résultats de la première session du Comité préparatoire de la Con-
férence des Nations unies pour le commerce et la développement,” February 7, 1963.
115
R. Prebisch, “Towards a New Trade Policy for Development. Report by the Secretary General of
UNCTAD 1964,” in P. Braillard and M.R. Dyalili, eds, The Third World and International Relations
(London: Frances Pinter, 1986), pp. 175–6.
116
G.P. Calchi Novati, Decolonizzazione e Terzo Mondo (Rome and Bari: Laterza, 1979), p. 138.
40 After Empires

a net impoverishment of the South’s inhabitants. Furthermore, according to the

calculations of UNCTAD economists, a growth rate limited to 5 percent would
also imply a rise in imports, with the result that by the end of the decade the
Southern countries would find themselves left with some $20 million in debt. To
avoid this trade gap measures needed to be taken in order to place more resources
at the disposal of Southern governments. This could take essentially three forms:
First, increasing profits derived from a growth in manufactures exported to the
industrialized world; second, raising the amount of direct aid afforded the poorer
countries; third, increasing the number and value of the basic commodities
exported from the South to the industrialized world. These measures were not
mutually exclusive, according to Prebisch, but rather were complementary.
With respect to the growth in exported manufactures and unfinished goods, the
principal charge leveled at the GATT was of having given birth to a system of free
trade tailored to the needs of the developed world. As the English economist Sid-
ney Dell, one of Prebisch’s primary collaborators, noted of the Kennedy Round:
“Particularly striking in this connection is the provision in the United States Trade
Expansion Act of 1962 whereby tariffs may be eliminated on items in which the
United States and Common Market countries together supply 80 percent of the
world’s trade.”117 Regarding commodities, the Prebisch Report posed a number of
unresolved questions: The system of taxation leveled on products from the South-
ern countries, like those of the tropics, created the paradox that the Italian govern-
ment, for example, could benefit from tax levies to earn more from the import of
a given product than it offered in aid.118 The prices of raw materials were for the
most part out of the hands of the producing nations, which possessed only 6 per-
cent of the world’s mercantile fleet, and were regulated principally by the financial
centers of New York or London.
The first UNCTAD conference took place in Geneva, not by coincidence in the
same city which hosted the GATT headquarters, from March 23 until June 15,
1964. It was the largest meeting on trade issues and development ever organized to
that date. During the course of discussions the Western nations betrayed notable
divisions among themselves while the Soviet Union displayed a measure of prudence
by paying greater attention to the international political balance of power, denying
China opportunities to radicalize their conflict, rather than exploiting the opportu-
nity to attack the capitalist system.119 At the end of more than two months of con-
fused negotiations, no agreement had been reached on the vast majority of questions.

117
S. Dell, Trade Blocs and Common Markets (London: Constable, 1967), p. 152.
118
Calchi Novati, Decolonizzazione, p. 138.
119
NA, FO 371/178077, “Preliminary Report, United Nations Conference for Trade and Devel-
opment,” July 1, 1964: “The attitude of the Americans has been the most disappointing part of the
conference. The French idea for organization of the raw materials market has surprisingly made a few
converts, while Francophone Africa has aligned itself with the 75 developing countries. The Belgians
have hewed close to the French line, and the Germans and Dutch, even though in open disagreement
with the French and Belgians, have let themselves be dragged along. The Canadian delegation was too
small to play a role, while the Australians made a noteworthy impression with a sizable delegation. The
Soviet bloc was not unanimous, and was almost completely absent in the negotiations during the last
few months.”
 The Third World and the Creation of UNCTAD 41

Recommendations were approved by majority vote but without binding clauses,

exactly as the Western governments had wished.
All the same, significant new trends emerged. On an institutional level it was
unanimously decided to create a series of new bodies within the UN: The Confer-
ence itself, which would continue to meet every three years, beginning in 1966; a
Trade and Development Commission composed of fifty-six members (including
eighteen Western states, six socialist countries, nine Latin American and twenty-two
Afro-Asian nations); and an UNCTAD Secretary-General (Prebisch himself would
be subsequently confirmed in the post). In addition, three working groups would
be created: One on commodities (nonagricultural products), one on manufactured
goods, and one on the so-called “invisibles” (direct aid, investment, loans, etc.).120
While no binding decisions were taken, the conference helped clarify a number
of debates that would later have a profound impact in a different international
context. In the commodities field, it was agreed to undertake a study of the organi-
zation of the market and excise taxes assigned to petroleum products—a demon-
stration, contrary to British assertions, of the traction of French ideas. With respect
to manufactures, India won adherents to its appeal for preferential treatment of the
developing countries’ finished goods. This came as quite a shock to the Americans,
who were not disposed to give in on the issue, particularly because such preferences
implied a radical redesign of GATT rules, rigorously based on the concept of reci-
procity. As regards aid, an issue accorded rather peripheral status, it was decided
that this should amount to a total of 1 percent of GDP from the developed nations,
and that it would be calculated on the basis of both private foreign direct invest-
ment and public aid.
In his speech before UNCTAD as the head of the Cuban delegation, Ernesto
“Che” Guevara had warned that:
[i]f, on the other hand, the groups of underdeveloped countries, lured by the siren
song of the interests of the developed powers who profit from their backwardness,
compete futilely among themselves for crumbs from the tables of the world’s mighty,
and break the unity of numerically superior forces; or if they are not capable of insist-
ing on clear agreements, without escape clauses open to capricious misinterpretations;
or if they rest content with agreements that can simply be violated at will by the pow-
erful, then our efforts will have been to no avail and the lengthy deliberations at this
conference will result in nothing more than innocuous documents and files for the
international bureaucracy to guard zealously: Tons of printed paper and kilometers of
magnetic tape recording the opinions expressed by the participants. And the world
will stay as it is . . .
The International Monetary Fund is the watchdog of the dollar in the capitalist
camp; the International Bank for Reconstruction and Development is the instrument
for the penetration of US capital into the underdeveloped world; and the Inter-
American Development Bank performs the same sorry function in Latin America. All
these organizations are governed by rules and principles that are represented as safe-
guards of fairness and reciprocity in international economic relations. In reality,

120
HAEU, CEAB 05/2017, Note, “Fin de la Conférence de l’ONU sur le Commerce et le Dével-
oppement,” June 17, 1964.
42 After Empires
however, they are merely fetishes behind which hide the most subtle instruments for
the perpetuation of backwardness and exploitation. The International Monetary
Fund, which is supposed to watch over the stability of exchange rates and the liberali-
zation of international payments, merely denies the underdeveloped countries even
the slightest measures of defense against competition and penetration by foreign
monopolies.121
While it lacked this revolutionary tenor, the Joint Declaration of the G77 at the end
of the Conference demonstrated that on economic issues the South, as long as it
acted in unison, could represent a force to be reckoned with. The declaration stated:
The developing countries regard their own unity as the outstanding feature of this confer-
ence. This unity has sprung out of the fact that facing the basic problems of development
they have a common interest in a new policy for international trade and development.
International observers were impressed by the fact that Arab and sub-Saharan
countries like Egypt and Ghana, without historically strong foundations or com-
mon ties, were able to unify in their fight against the “white man” and demon-
strated their willingness to cooperate in future battles against poverty and for
industrialization.122 The Belgian Ambassador Forthomme, who had been charged
in the OECD with coordinating the position of the industrialized nations, could
not help but express his concern for the future of the international economy:
The great danger is that, if a constructive dialogue is not opened with the 77, they
might undertake restrictive trade policies with the result of closing entire regions off
from one another, which would have very serious consequent effects on both the
developed and developing countries . . . They are seeking compensation not only for
the deterioration of their exchange rates but also for the impact of competition from
synthetic products; and the line of compensation has almost reached so far as to
request compensation to address different standards of living. Considering this situa-
tion the Western countries will run the risk that the 77 might impose their solution
unilaterally, combining this with a tendency toward national or regional autarky.123
Growing anxieties within the industrialized states regarding the emergence of a
unified front of Southern nations softened the stance of even the most hard-line
Western liberals, and made possible the first reforms of the Bretton Woods eco-
nomic institutions. In 1965, one year after the conclusion of the first UNCTAD,
Part IV of GATT was adopted, recognizing the vast differences in standards of liv-
ing between the developed and developing worlds, taking into account the impor-
tance of adequate incomes for Third World exporters, and encouraging nonreciprocal
trade agreements between countries with different standards of living. In 1963 the
IMF had created a new type of loan to protect commercial trade balances, and in
1966 it conceded the opening of this Compensatory Financing Facility to the
emerging nations, though the conditions offered were no more advantageous for

121
Che Guevara, Che Guevara Reader, 2nd edn (New York: Ocean Press, 2003), pp. 308–12.
122
P. Worsley, The Third World (London: Weidenfeld, 1964), p. 333.
123
HAEU, OECD 151, Trade Committee, “Summary Record of the 9th Meeting held at the
Chateau de la Muette, Paris, September 18, 1964.”
 The Third World and the Creation of UNCTAD 43
them than for the industrialized countries, contingent as these loans were upon
strict “cooperation” with the Fund.124
The birth of a trade union of Third World countries meant not only the creation
of a new economic institution within the UN, but also parallel and temporary
weakening of more radical, conflicting, political impulses with respect to the
industrialized world, which pre-dated the emergence of the independence
movements.
In 1965, with the failure of the second Bandung Conference, the Afro-Asian
movement was finally and permanently defeated. In the Afro-Asian Economic
Summit of 1965, Che Guevara had urged the creation of new, autonomous instru-
ments for common dialogue and action among colonized peoples, sparing no one
from criticism, not even the Soviet Union:
How can it be “mutually beneficial” to sell at world market prices the raw materials
that cost the underdeveloped countries immeasurable sweat and suffering, and to buy
at world market prices the machinery produced in today’s big automated factories?
If we establish that kind of relation between the two groups of nations, we must
agree that the socialist countries are, in a certain way, accomplices of imperialist
exploitation.125
Guevara’s entire strategy, of a revolutionary conflagration spreading among the peo-
ples of three continents, was revived with his speech at the 1966 Tri-Continental
Solidarity Conference in Cuba—best known for its call to “create two, three, many
Vietnams”—but it never took off, undermined in the short term by the logic of
détente between the USA and the USSR, which put a brake on Third World radi-
calism. Guevara’s speech, delivered in absentia while he was preparing his Bolivian
campaign, was based on his notion that the peoples of the developing world pos-
sessed an unlimited capacity for indignation, action, and ultimately for battle:
We must definitely keep in mind that imperialism is a world system, the final stage of
capitalism, and that it must be beaten in a great worldwide confrontation. The strate-
gic objective of that struggle must be the destruction of imperialism.
The contribution that falls to us, the exploited and backward of the world, is to
eliminate the foundations sustaining imperialism: Our oppressed nations, from which
capital, raw materials and cheap labor (both workers and technicians) are extracted,
and to which new capital (tools of domination), arms and all kinds of goods are
exported, sinking us into absolute dependence.126
But in the span of a few short years, one after another, an entire generation of
Third World independence leaders would lose their power or their life, or both,
substantially weakening the effort to create an autonomous, politically militant
bloc in international affairs. Nehru died in 1964; Sukarno, the Algerian leader Ben
Bella, and Nkrumah were overthrown by military coups between 1964 and 1965,
after having relied too heavily on their own personal charisma and too little on

124
J. Adda and M.C. Smouts, La France face au Sud (Paris: Karthala, 1989), p. 118.
125
Guevara, Che Guevara Reader, p. 341.
126
Che Guevara, Global Justice: Liberation and Socialism (New York: Ocean Press, 2002), p. 58.
44 After Empires
mechanisms of mass political participation. Che Guevara himself would of course
be killed in 1967 in Bolivia, while he attempted to put into practice his strategy of
revolutionary foquismo (guerrilla focos, or “fires”) elaborated at the Tri-Continental
Conference. The coup de grâce to the idea of African autonomy was delivered with
the severe lesson imparted to Egypt by Israel in the Six Days’ War, a conflict the
larger significance of which we shall return to later.127 In short, in the aftermath of
the first UNCTAD the most revolutionary impulses among the Third World lead-
ership seem to have largely exhausted themselves. At the same time the consolida-
tion of power by new national elites, whether civil or military, appeared to be
proceeding faster than the implementation of internal social reforms or mecha-
nisms of popular participation.
In the long run, the several projects of regional integration founded in the heady
years of the early 1960s, and subsequently heralded at Geneva as the strategic solu-
tion to the problems of underdevelopment in the UNCTAD Final Declaration,
failed to take root. It has been estimated that by the middle of the 1960s there were
at least fifty countries that were taking part, in one way or another, in regional
integration initiatives, the most notable of which was probably the Latin America
Free Trade Association (LAFTA). Between 1964 and 1968 all these projects faced
substantial crises.128 Among the reasons for the failure of these efforts at regional
integration in the Third World were the excessive emphasis placed by the develop-
ing nations on the defense of industrialization; the fact that in Asia two of the great
powers, India and China, were largely focused on national development schemes;
the strong ties binding Latin America to the United States; the fact that none of
the major Western powers favored the regionalization of development aid, as had
happened, for example, in the case of western Europe during the years of the Mar-
shall Plan.129
That said, while in 1960—when pressure from the newly elected Kennedy
administration had resulted in the creation of the DAC and reform of the World
Bank—the Western world seemed to be comfortable with the idea that the efficient
planning of aid would be sufficient to solve the problems of the Third World and to
bring it closer into line with an economy based on free markets, the birth of the
G77 forced the industrialized countries to come to grips with the need to partially
reassess and reform the structures underlying trade and the international economy.

127
Westad, The Global Cold War, p. 107.
128
In the formulation of projects for regional integration in Africa, like that put forward by Nkru-
mah at the Pan-African Conference held at Addis Ababa in 1963 (“we are already at the point where
it is necessary to unite if we want to avoid being picked off one by one, like the situation in Latin
America”), Europe was invoked as the primary power against which it was necessary to unite. In the
Latin American case, the proposed treaty advanced by Raúl Prebisch in 1965 instead cited the EEC as
a positive example. On the relationship between African regional integration and the EEC see G.
Montani, Il Terzo mondo e l’unità europea (Napoli: Guida Editori, 1979); M. Noelke, Europe–Third
World Interdependence: Facts and Figures (Brussels: Commission of the European Communities, 1979).
On Latin American efforts to create a common market on the model of the European Community see
S. Dell, A Latin American Common Market? (Oxford: Oxford University Press, 1966).
129
M.S. Wionczek, ed., Economic Cooperation in Latin America, Africa, and Asia (Cambridge, MA:
MIT Press, 1969).
 2
The Myopia of the European Community

If not a founding father of the European Economic Community, the Belgian

Fernand Dehousse was certainly one of its most distinguished senators. An illustri-
ous jurist and member of both the Council of Ministers and the Parliamentary
Assembly of the ECSC, he had hoped that Europeans’ colonial experience would
not be so easily or carelessly discarded:
Allow me to express all the sympathy that I personally feel for the struggle of a France
that fights to avoid a conflict between East and West, which would also be fatal to the
European Community, with all that it represents, as well as for all mankind.
It is in Algeria today that French and European claims toward universality are being
put to the test. A French abandonment of Algeria would signify the retreat of Europe
into itself.1
Born from the twin traumas of a world war and the progressive crumbling of its na-
tions’ various imperial projects, the EEC—which would be included within the Euro-
pean Communities (EC) with the Merger Treaty signed in 1965—lacked any ambition
to promote the cause of world civilization. It proved to be a rather more bland, prag-
matic entity, mainly aimed at establishing a European Common Market and defending
European agriculture. Retrenchment within national borders prevailed over grander
strategic visions, while advocates of pro- or neo-Atlanticism—Atlanticism combined
with aspirations to enhance national greatness and develop special links with newly
independent countries—had their way on the most pressing international issues of the
day. We shall see that once the idea of Eurafrique had been definitively shelved,2 the
French managed to overcome the outright opposition of the other Member States to
an association between the EEC and the former French colonies in Africa only by
threatening to sacrifice the entire integration project if no agreement was reached.
Once the colonial state was no more, so went the notion of “colonial development”
and with it, all of the European empires’ considerable, if misconceived, efforts to
build colonial economies or integrate and educate their colonial subjects. Frederick
Cooper has brilliantly summarized the situation of these newly independent gov-
ernments with regard to international aid: “Independence turned entitlement into

1
F. Dehousse, L’Europe et le Monde. Recueil d’études, de rapports et de discours 1945–1960 (Paris:
Librairie Générale de Droit et de Jurisprudence, 1960), p. 524.
2
The idea of Paneuropa, including Europe, Africa, and regions of the Middle East was present in
the German geopolitical thought of Karl Haushofer. This new aggregation should have been able to
oppose itself to Panamerica, Panrussia, and Panpacifica. E. Deschamps, “L’Afrique belge et le projet de
Communauté politique européenne (1952–1954),” in E. Remacle and P. Winand, America, Europe,
Africa. L’Amérique, l’Europe, l’Afrique 1945–1973 (Brussels: PIE Peter Lang, 2009), p. 310.
46 After Empires

supplication.”3 As developing nations in Asia and Africa became independent, they

mainly came to be seen in western Europe as useful providers of labor and raw
materials, potential outlets for surplus manufactures, junior partners to be pre-
served from the spread of international communism.

T H E PA S S I N G O F I M P E R I A L I L LU S I O N S

In his memoirs, Jean Monnet recalled how Louis Armand—one of the “three wise
men” charged, after the failure of the European Defence Community in 1954,
with relaunching a common European initiative through a joint atomic energy
project—provocatively proposed the erection of a statue honoring Nasser as “the
federator of Europe.”4 Having dealt a severe blow to the imperial dreams of France
and the United Kingdom in 1956, the Egyptian leader had also cleared the path
for a new French commitment to Europe.
But the signing of the Treaties of Rome in 1957—which formally established the
European Economic Community—cannot be considered the conscious decision of
national leaders to place their hopes in Europe as a political actor or even in the idea
of Europe as their primary theater of economic activity. The Beyen plan, which
formed the basis for the Common Market, was based strongly on Atlantic inspira-
tions, centered on the need to reduce tariff barriers first among the Six, and later
between the Six and the United States. While Euratom, as initially proposed by the
“wise men,” never seriously managed to develop plans for an independent European
energy program, the creation of a Common Market greatly helped oil multination-
als—of which only Shell was partially based in one of the EEC’s six founding mem-
bers—to dominate western Europe’s energy market in the passage from coal to oil.5
In fact European federalists had viscerally opposed the EEC treaty because it did not
provide enough space for a supranational dimension.6 The 1960s were years of sub-
stantial economic growth in Europe, a period of great vitality for its nation states,
which invested in infrastructural improvements, communications, and manufac-
turing, pumping fresh blood into national economies and placing citizens in con-
tact with each other, often for the first time, by means of new technologies such as
the television.7 Behind European economic cooperation there was profound and
deeply rooted reciprocal distrust.8 As late as the early 1960s surveys showed that, in

3
Frederick Cooper, “Writing the History of Development,” (2010) 8(1) Journal of Modern Euro-
pean History, p. 15.
4
J. Monnet, Mémoires, trans. Richard Mayne (London: Collins, 1978), p. 422.
5
T. Mitchell, Carbon Democracy. Political Power in the Age of Oil. New York: Verso, 2011, p. 108.
6
The Treaty of Rome was an important contribution to the construction of European economic
regionalism, and constituted without a doubt a political decision. But the consequences of this act
would be felt only at the end of the 1960s. On the nature of the Common Market and the theoretical
issues it raised see (2003) 14 Memoria e ricerca (December 2003). On the political debate within the
European left after the birth of the EEC see S. Cruciani, L’Europa delle sinistre. La nascita del Mercato
comune europeo attraverso i casi francese e italiano (1955–1957) (Rome: Carocci, 2007).
7
C.S. Maier, “Secolo corto o epoca lunga? L’unità storica dell’età industriale e le trasformazioni
della territorialità,” in C. Pavone (ed.), ‘900: I tempi della storia (Rome: Donzelli, 1997), p. 51.
8
D.J. Puchala, “Western European Attitudes on International Problems, 1952–1961,” (1964) 1
Yale Research Memoranda in Political Science, pp. 266–79.
 The Myopia of the European Community 47

the event of war, only 25 percent of the French would trust the British, 20 percent
the Germans, and 14 percent the Italians; for their part, only 21 percent of Ger-
mans held any faith in the French, 19 percent in the Italians, and 17 percent in the
English. The Italians were, if possible, even more skeptical of their European neigh-
bors over the Alps, influenced perhaps by the treatment of Italian emigrants in
Northern Europe.9 Pieter Lagrou has argued that it was only after 1965, with the
celebrations of the twentieth anniversary of the end of the Second World War, that
an era characterized by the recrudescence of jingoistic patriotism and the construc-
tion of official myths and heroes could be considered over, allowing space for the
diffusion of more dispassionate national histories.10
Among the six members of the European Community in 1957, only tiny Lux-
embourg—and the Federal Republic of Germany, albeit for very different rea-
sons—had no formal colonial relations or special ties with one or another of the
countries in the developing world. France, Belgium, the Netherlands, and to cer-
tain extent even Italy, were still colonial powers when the Rome Treaty was signed
and managed to include their colonial possessions, such as French Africa and all
other French Overseas départements and territories, the Belgian Congo and
Rwanda, Dutch New Guinea, and Italian Somalia, as associated to the EEC.11 The
French even sent three African representatives from their colonies to the Parlia-
mentary Assembly of the EEC, allegedly in an effort to “make it clearly be under-
stood to the representatives of the five signatories of the treaties on the Common
Market and Euratom, the importance that France attributes to the defence of the
interests of the African people.”12
Martin Shipway has defined the policies of the old European metropoles up to
the end of the 1950s as a “late colonial shift,” characterized by the attempt to re-
launch their imperial projects through economic rationalization programs and ef-
forts to improve the political organization of the colonial states.13 In 1946 the
French had launched their Fonds d’Investissement en Développement Economique et
Social (Fund for Economic and Social Development) to revive their colonies’ econ-
omies, and even as late as 1958 the government set up a FFR2 billion plan to re-
launch the Algerian economy. The British boasted that the sterling area continued
to represent between 36 and 40 percent of world trade up to the end of the 1950s,
and constituted a fundamental source of foreign currency. Belgium, in 1949,
launched a Ten-Year Plan aiming at reinforcing Congo’s infrastructure and creating
a native middle class that would remain politically reliable and form a backbone of

9
On the “selling” of Italian emigrants by the Italian government in the 1950s and their working
conditions in northern Europe, see M. Colucci, Lavoro in movimento. L’emigrazione italiana in Europa
1945–57 (Rome: Donzelli, 2008).
10
P. Lagrou, The Legacy of Nazi Occupation. Patriotic Memory and National Recovery in Western
Europe, 1945–1965 (Cambridge: Cambridge University Press, 2000), p. 15.
11
Part IV of the EEC Treaty provided for the association with “pays et territoires d’outre-mer”:
<http://eur-lex.europa.eu/fr/treaties/dat/11957E/tif/TRAITES_1957_CEE_1_XM_0114_x555x.
pdf>.
12
AMAEF, Cabinet du minister Couve de Murville, Carton 331, lettre de Emile Roche au Prési-
dent Charles de Gaulle, 15/0771958.
13
Shipway, Decolonization and its Impact, p. 51.
48 After Empires

potential consumers. The East Indies accounted for 14 percent of the Netherlands’
GDP after the war, and represented a vital source of oil and and other raw materi-
als to be processed at home—a source over which they would refuse to relinquish
control until the end of the 1950s. Once their colonial states had crumbled, Euro-
pean states abandoned their serious efforts at development, but by no means did
they cease attempting to profit from their ties with their former colonies.14
De Gaulle, who returned to power one year after the signing of the Treaties of
Rome in 1958, nurtured an ambitious plan to create a French Community that
would include all the Francophone territories of Africa. France’s natural sphere of
influence, he believed, extended from continental Europe across Africa and the
Middle East: A notion that prompted the French government to revive the idea of
a Eurafrique, potentially linking the two continents through common institu-
tions.15 Although the idea was already dead by 1960, when the African nations of
the French Community opted for independence, de Gaulle fought until the bitter
end to retain control of Algeria.16 For the French government 1962, with the
formal declaration of Algeria’s independence, represented not only the end of its
colonial ambitions but also the defeat of the Fouchet Plan, its project for European
political unity based on a federation of the six major states, which would have
counterbalanced the Community’s existing institutions.17 At the end of that year,
France thus sought a new grand idea that would bring it a global role equal to de
Gaulle’s ambitions.18 In his traditional end-of-year speech, de Gaulle reminded the
nation that “aid must be given to peoples in need for their modern development
and, above all, for the spirit of cooperation with those nations of Africa, Asia, and
Latin America which ask for assistance from France.”19 He considered the Euro-
pean Community, through its ties with the Association of the African States and
Madagascar (AASM), formalized in the 1963 Yaoundé Convention imposed by
France on its partners,20 as an instrument for the maintenance of France’s privileged

14
Nicholas J. White, “Reconstructing Europe through Rejuvenating Empire: The British, French,
and Dutch Experiences Compared,” in Mazower, Reinisch, and Feldman (eds), Post-War Reconstruction
in Western Europe, pp. 211–36. On Belgium in particular, see J.P. Peemans, “Imperial Hangovers: Bel-
gium—The Economics of Decolonization,” (1980) 15 Journal of Contemporary History, pp. 257–86.
15
R. Girault, “La France entre l’Europe et l’Afrique,” in E. Serra (ed.), La relance européenne et les
traités de Rome (Actes du colloque de Rome, 25–28 mars 1987) (Milan: Giuffré, 1989), pp. 351–78;
G. Bossuat and M.T. Bitsch (eds), L’Europe unie et l’Afrique. De l’idée d’Eurafrique à la Convention de
Lomé I (Brussels: Bruylant, 2005).
16
In his memoirs de Gaulle wrote that he understood full well by 1960 the need for Algerian “self-
determination,” which was not exactly the same thing as “independence”: See A. Horne, A Savage War
of Peace: Algeria, 1954–1962 (New York: New York Review of Books, 2006), pp. 343–4.
17
G.H. Soutou, L’alliance incertaine. Les rapports politico-stratégiques franco-allemands 1954–1996
(Paris: Fayard, 1996), pp. 176–229.
18
M. Vaïsse, La grandeur: politique étrangère du général de Gaulle 1958–1969 (Paris: Fayard, 1998),
p. 453. According to Vaïsse the new French policy was guided by the division of the communist world
between the Soviet Union and China, the dialogue between the nuclear superpowers, and the emer-
gence of the Third World after decolonization.
19
Institut du Droit de la Paix et du Développement, Institut Charles de Gaulle, De Gaulle et le Tiers
Monde (Paris: Editions Pedone, 1983), p. 247.
20
G. Migani, La France et l’Afrique sub-saharianne, 1957–1963. Histoire d’une décolonisation entre
idéaux eurafricains et politique de puissance (Brussels: PIE Peter Lang, 2008).
 The Myopia of the European Community 49

role with the Francophone nations at the lowest possible cost. The new association
was symbolically signed in Cameroon, thus avoiding the eurocentrism of Rome in
1957, and included a development fund and common institutions. In the long run
this institutional link between the EEC and some former colonies did bear some
fruits in terms of cooperation. But in the short run Yaoundé was managed by
French administrators with a colonial background—the Commissioner for Devel-
opment up the 1980s would be French-backed and controlled by a German Direc-
tor-General—and, according to the definition of Jacques Ferrandi, the all-powerfull
French Commissioner, the distribution of funds was quite subject to political pres-
sures: “Justement: Aucune procédure. La procédure n’était pas fixée.”21
De Gaulle was convinced at the same time that, with his plans for a Eurafrique
definitively sunk, France should also play its global role as partner to the non-
aligned countries.22 This policy was based largely on solemn speeches and grandi-
ose gestures, on the rupture with NATO—more symbolic than substantive, it
succeeded only in forcing the alliance to move its headquarters from Paris to Brus-
sels, while France remained a member of the Atlantic Pact—and on the idea of
Europe as a “Third Force.” At the same time, France held onto its special economic
and cultural relationships with its former colonies. The Francophone nations re-
mained tied to the French franc, and were inundated by a sea of French teachers in
order to preserve their common cultural bonds, a mission given by de Gaulle to
Minister of Culture André Malraux.23 Some have claimed that de Gaulle’s open-
ness to the global South was little more than a “marriage of convenience”;24 others
have spoken of an “empire of words.” For Paris, at any rate, the end of its colonial
empire had not signified the weakening of its politics of national prestige, in favor
of common European cooperation with the developing world.
Nowhere was the relinquishing of colonial ties a completely painless process, not
even for Belgium, a country that—as home to the European institutions and even-

21
See <http://www.eui.eu/HAEU/OralHistory/pdf/INT711.pdf>.
For an analysis of French aid in the 1960s, see J. Meimon, “L’invention de l’aide française au dével-
oppement: Discours, instruments et pratiques d’une dynamique hégémonique,” in (2007) 21 Ques-
tions de recherche, September 2007, pp. 15–16. On DG VIII, see V. Dimier, “L’institutionnalisation de
la Commission Européenne (DG Développement): Du rôle des leaders dans la construction d’une
administration multinationale, 1958–1975,” in (2003) 34(3) Etudes Internationales (Canada), pp.
401–28. On EC development policy, see G. Laschi, “La nascita e lo sviluppo delle relazioni esterne
della Comunità dalle colonie alla cooperazione allo sviluppo,” in G. Laschi and M. Telò, Europa
potenza civile o entità in declino? Contributi ad una nuova stagione multidisciplinare di studi europei
(Bologna: il Mulino, 2007), pp. 51–81.
Some figures give an idea of how European cooperation policy was essentially designed to prolong
French colonial ambitions: “Of the $580 million of the European fund, $511 [million] are distributed
to states which have ‘special relations’ with France, against $30 [million] for the former territories of
Belgium and $35 [million] for New Guinea . . . The detachment of the DGVIII from French interests
was, however, far from a reality up until the end of the 1970s.” F. Turpin, “Alle origini della politica
europea di cooperazione allo sviluppo: la Francia e la politica di associazione Europa-Africa (1957–
1975),” in (2007) 6 Ventunesimo Secolo (October 2007), p. 137.
22
Only in 1966 did development aid and cooperation begin to be directed by the Quai d’Orsay.
G. Bossuat, “French Development Aid and Cooperation under de Gaulle,” in (2003) 4 Contemporary
European History, pp. 431–56.
23
J. Chipman, French Power in Africa (Oxford: Blackwell, 1989), p. 197.
24
Vaïsse, La grandeur, p. 453.
50 After Empires

tually to NATO—Nkrumah considered little more than a beachhead for American

capital and multinationals. A 1947 memo on social policy circulated by the Belgian
Union Minière in Congo well encapsulated the sense of entitlement and of a “civi-
lizing” mission of Belgian economic concerns in the region after the war:
The colonizer must never lose sight of the fact that the Negroes have the souls of chil-
dren, souls which mould themselves to the methods of the educator; they watch,
listen, feel, and imitate. The European must, in all circumstances, show himself a chief
without weakness, good-willed without familiarity, active in method and especially
just in the punishment of misbehavior.25
Even for the socialist leader Paul Henry Spaak, the Congo was the jewel in Bel-
gium’s crown, a profitable and prestigious resource that, among other perks, al-
lowed the nation to enjoy greater influence within the Atlantic military alliance. A
group of Congolese students visiting Brussels in 1956 were left perplexed by this
typically colonial cast of mind, such conservatism in one of the most prestigious
leaders of European socialism, not to mention one of the most influential promot-
ers and founding fathers of European integration.26 In 1960–61 Belgium under-
went some of the most violent social upheavals in its history as the socialists began
a period of electoral dominance, yet none of this turmoil made any significant
impact on the nation’s stance toward its colonies. Spaak boasted of having de-
fended the French government before the UN in 1960, describing the Algerian
question as a domestic matter, to be handled according to the French constitution
of 1946, and criticizing the mistaken beliefs of those who would bargain with the
new Arab Hitler, General Nasser.27 Only the final withdrawal from the Congo in
1964 freed Belgium from the contradictions of its colonial policy, which had re-
ceived scarce support from its Community partners, forcing the country to face
the difficult task of rebuilding a national identity threatened from within by the
claims of its diverse linguistic groups.
After the defeat at Suez, even the conservative British government was forced to
recalibrate its imperial aims.28 London viewed its application to join the European
Community as an instrument to bind the Six more tightly to its Atlantic partners,
but the French refusal to admit the United Kingdom, followed by the victory of
Harold Wilson’s Labour Party in 1964, breathed new life into the concept of the
British Commonwealth. In this vision, Great Britain was conceived as the hub at
the center of ever-widening concentric circles of global relations, the cultural and
economic special relationship with the United States given pride of place alongside
the Commonwealth.29 In the course of a parliamentary debate in 1961, Wilson

25
D. Litvin, Empires of Profit. Commerce, Conquest and Corporate Responsibility (New York: Texere,
2003) p. 160.
26
R. Coolsaet, Histoire de la politique étrangère belge (Brussels: Vie Ouvrière, 1988), p. 172.
27
P.H. Spaak, Combats Inachevés. De l’Indépendance à l’Alliance (Paris: Fayard, 1969).
28
John Darwin describes the painful process of departing from “overseas interests” that had a very
large constuency even though “enthusiasm for imperial rule was confined to a limited section of the
upper class.” J. Darwin, The Empire Project. The Rise and Fall of the British World System 1830–1970
(Cambridge: Cambridge University Press, 2009), p.15.
29
P. Ziegler, Wilson. The Authorised Life (London: Weidenfeld & Nicolson, 1993), p. 219.
 The Myopia of the European Community 51

had made it clear that “we are not entitled to sell our friends and kinsmen down
the river for a problematical and marginal advantage in selling washing machines
in Dusseldorf.”30 Wilson was firmly entrenched in the intellectual lineage of the
first postwar Labour government of Clement Attlee, which had hoped to export
the benefits of the British welfare state to the Commonwealth nations—a notion
as far-sighted in theory as it was untenable in practice, given the ever-diminishing
foreign currency reserves of the United Kingdom.31 Upon election, Wilson was
quick to assert that the borders of Great Britain reached as far as the Himalayas,
hurriedly created an Office of Overseas Development—which was supposed to
coordinate its aid efforts—and was involved in the inauguration of the Institute for
Development Studies at the University of Sussex, which became one of the first
and most advanced centers in Europe for the study of the problems of underdevel-
opment. Even Raúl Prebisch was invited to collaborate.32
Even Italy, the most underdeveloped of the EEC countries and a defeated mili-
tary power that had been forced to renounce control over Libya and Eritrea, man-
aged to return to one of its former colonial possessions in the Horn of Africa. In
1950, Rome obtained a trusteeship over Somalia which allowed it to guide that
country’s transition to independent government, which Somalia eventually
achieved in 1960. During that time, Italy made efforts at colonial development by
opening elementary schools for a population some 90 percent of which was illiter-
ate—classes were taught rigorously in Italian—and in 1958 Rome offered a hun-
dred scholarships and planned an investment of US$2 million to help the Somali
economy.33
While renouncing colonies could coincide with a greater commitment to har-
vesting the fruits of economic collaboration among European states, the idea of
political and cultural integration was still insufficiently developed to replace im-
perial imagery. The imperial past either was celebrated up to the end of the 1950s
or it simply seemed to give way to the “politics of forgetting,” whereby the funda-
mental economic role of the colonies in building the great European cities and
industries was overlooked, while the violence of occupation was simply
removed.34
The epic stories of glorious colonial campaigns still constituted one of the pri-
mary foundations in the development of French and English students’ historical
consciousness. A 1949 French text on “imperial expansion,” for example—comparing
French Prime Minister Jules Ferry, Belgian King Leopold II, Italian Prime Minister
Francesco Crispi, the British statesman Austen Chamberlain, and US President
Theodore Roosevelt—opened with a tribute “to the force of will, to the tenacity, to

30
H. Young, This Blessed Plot: Britain and Europe from Churchill to Blair (London: Papermac,
1998), p. 157.
31
F.S. Northedge, Descent from Power: British Foreign Policy, 1945–1973 (London: Allen & Unwin,
1974), p. 220.
32
A. Thorpe, A History of the British Labour Party (London: Palgrave, 2001), p. 156.
33
A. Morone, L’ultima colonia. Come l’Italia è tornata in Africa 1950–1960 (Bari: Laterza, 2011).
34
A. Hochschild, King Leopold’s Ghost (New York: Houghton Mifflin, 1908), pp. 296–306.
52 After Empires

the civic courage of the statesmen that had the sens de la grandeur.”35 The newly
independent states were typically seen as inadequate to the task of managing the
transition to a society based on industrial labor, and ungrateful to the civilization
that had spent so much in means and manpower so that they could escape barba-
rism. The passing of imperial illusions was accompanied by a retreat behind na-
tional borders, and a consequent cynicism regarding Third World nations’
ambitions for autonomy. This cynicism was not necessarily overt racism, a notion
widely discredited by the memory of Nazi racial policy, but a peculiar blend of
benevolent paternalism and a growing consciousness of living through a produc-
tive revolution that had left the world’s periphery increasingly far from modernity.
The retreat from empires also meant the progressive restriction of access to the
metropole for citizens of the former colonies. Often they were suddenly transformed
from potential nationals—that is, persons endowed with rights—to mere man-
power, hired through short-term contracts with foreign governments that did not
have much concern for the living conditions of such workers (in France, for exam-
ple, migrants largely still lived in bidonvilles). According to one of the few com-
parative studies of postwar immigration policy in western Europe, the British
approach, for example, could be called “an attempt to remove rights of citizenship
too generously extended during the colonial period.”36 Europeans who came back
after the failed imperial wars, meanwhile, even though their numbers were by no
means small (at least 250,000 Dutch came back to Europe from the East Indies
alone), were absorbed with relative ease: Until the late 1960s their voices and their
painful memories of war and often of torture were very rarely given any space in
the press or in academic debate.37
In the United Kingdom policy toward citizens of the Commonwealth was nom-
inally anything but racist: Residents from as far away as the Caribbean and Pakistan
had the right to British citizenship. Their contribution as laborers was considered
vital in the service sector, in domestic employment, and in the hospitals as in
public transportation and all the new functions and services generated by the tre-
mendous expansion of the role of the state. V.S. Naipaul, a native of Trinidad who
moved to England for university study, described the welcome experienced by the
first young immigrants of the 1950s in the bohemian salons of London:
The immigrants, from the Caribbean, and then the white colonies of Africa, and then
Asia, had just arrived. They were still new and exotic; and there were English
people—both high and low, with a taste of social adventure, a wish from time to time
to break out of England, and people with colonial connections who wished in London
to invert the social codes in the colonies— . . . who were ready to seek the more stylish

35
C.A Julien, J. Brohat, G.Bourgin, M.Crouzet, and P.Renouvin, Les politiques d’expansion imperi-
aliste. J. Ferry, Leopold II, F. Crispi, J. Chamberlain, Th. Roosevelt (Paris: PUF, 1949).
36
G. Freeman, Immigrant labor and racial conflict in industrial society: The French and British experi-
ence: 1945–1975 (Princeton, NJ: Princeton University Press, 1979) p. 38. See also A. Geddes, Immi-
gration and European Integration. Beyond Fortress Europe (Manchester: Manchester University Press,
2008).
37
H.L. Wesseling, “La décolonisation et la mère-patrie: Mentalités et mémoire collective,” in
C.R. Ageron and M. Michel (eds), L’ère des décolonisations (Paris: Editions Karthala, 1995).
 The Myopia of the European Community 53
and approachable of the new arrivals. They met in Notting Hill, neutral territory, in
dimly lit furnished flats in certain socially mixed squares . . . ; and they were gay and
bright together. But few of the immigrants had proper jobs, or secure houses to go
back to.38
The Labour program of 1958 described the Commonwealth as the best means of
achieving racial understanding.39 This does not mean, of course, that there was not
widespread skepticism regarding the ability of the ex-colonies to develop, or that
some in certain circles harbored deeply rooted racial convictions just below the
surface. In one of his African travel stories from 1963, the Italian author Alberto
Moravia described a lunch among the English travelers in a grand hotel in
Mombasa, Kenya. There in the ex-colonies, he wrote, specimens of homo Victori-
anus remained perfectly preserved, in both their physical bearing and their native
dress, not to mention in their dinner-table chatter, overheard by the author:
The summary of it is this: The Africans will prove themselves incapable of carrying on
the administrative, economic and social machine created by the Europeans in Africa.
Once the whites have departed, everything will go to pieces. And this, not so much
because the Africans are lacking in certain qualifications that can be acquired with
time, as because they are essentially incapable of doing certain things, in other words
because they are racially inferior.40
In a televised interview Hugh Trevor-Roper, the famous Oxford historian, demon-
strated his intellectual honesty: “Perhaps in the future, there will be some African
history to teach. But, at present there is none: there is only the history of the Euro-
peans in Africa. The rest is darkness, and darkness is not the subject of history.”41 In
August 1958, a week of skirmishes between local Teddy boys and Caribbean im-
migrants suddenly disrupted the quiet of the residential London neighborhood of
Notting Hill. Notwithstanding the fact that it was the Teddy boys that instigated
the incidents, for which the majority of the 120 persons arrested were white, the
incident raised eyebrows and suspicions throughout the UK; a Gallup poll in 1961
found that some 67 percent of those interviewed supported tighter controls to check
the flow of immigrants from the Commonwealth. The next year, the Conservative
government introduced a voucher system that restricted entrance to those who
could provide proof of employment, thereby abolishing the automatic welcome
previously reserved for the citizens of the ex-colonies.42 The minutes of a debate in
a mid-sized urban section meeting of the Labour Party capture the evolution of citi-
zens’ thinking on immigration, from the idealistic view of a Great Britain as beacon
of civilization and integration, to the more modest effort to manage racial conflict
within the country and thereby defend existing levels of social progress:

38
V.S. Naipaul, Half a Life (New York: Vintage, 2002), pp. 68–9.
39
C. Knowles, Race, Discourse and Labourism (London: Routledge, 1992), p. 95.
40
A. Moravia, Which Tribe Do You Belong To?, trans. Angus Davidson (New York: Farrar, Straus,
and Giroux, 1974), p. 50.
41
J.H. Mittelman, Out from Underdevelopment. Prospects for the Third World (New York: St. Martin’s
Press, 1988), p. 31.
42
A. Porter and A.J. Stockwell, British Imperial Policy on Decolonization 1938–1964, vol. 2
(London: Macmillan, 1989), p. 77.
54 After Empires
A member said we might just as well give the whole damn country to the Blacks as
they would get it in the end anyway. Before long we would have a Black king on the
throne and then it would be God help us! The poor old white man might just as well
emigrate and leave the place to them. . . .
He said that this Black menace had ruined our towns and forced the whites out of
them. The best thing we could do would be to send the whole damn lot back to where
they came from!
Mr Storrow said he was not aware that Ian Smith [Prime Minister of the white
government of Rhodesia] was present but apparently he was.
Mr Whittle said they must learn to reject some of their ways. Some of them would
gladly do without education for their children and street lighting, etc. if it saved them
paying Rates and Taxes. We were gradually winning the battle but it was a long fight. . . .
Mr. Bell said he didn’t see why we should accept their ways as it was our country.
Mr. Blair said they worked well alongside us. But he believed in the old saying of
when in Rome do as Rome does.
Dr. Tombs thanked everyone for an interesting discussion.43
In France such attachment to the colonies—which, it will be recalled, formed a
vital base for the armed Resistance against the Nazis—suffused the entire nation.
The colonies were considered a part of the country, vital to national prestige, the
economy, and the national culture. In his 1944 series of lectures on European his-
tory at the Collège de France, Lucien Febvre had predicted that the problem facing
Europe after the war would be deeply entwined with that of the former colonies,
so that it would be impossible to provide distinct solutions to each that would not
affect both Europeans and colonial citizens:
Before the war it was estimated that France contained some 40 million persons, but a
census counted some 100 million French citizens in total, dispersed throughout the
various parts of its colonial empire. If France enters into a European federation, should
it leave out all these members of its family? What about Algeria, for example, which is
composed of three French départements, with senators, deputies, and ministers—
among them ministers of great historic stature, like [Eugène] Etienne, and [Gaston]
Thomson? What about Martinique? What about Guadalupe? What about India?
What about Senegal? In short, what about all the rest? And if you admit all the rest,
you admit the entire world, bit by bit, into this European federation.44
In 1949, 81 percent of the French thought that France should possess an empire,
and 62 percent were convinced that Paris had done a good job with its colonies.
This consensus might have motivated high levels of investment in the colonies but,
with time and the ever-larger military commitment to the Algerian war, the per-
centage in favor went into steady decline.45 That said, in 1956 the Socialist Prime
Minister Guy Mollet proudly declared before Parliament that:

43
S. Fielding, The Labour Party. Socialism and Society since 1951 (Manchester: Manchester Univer-
sity Press, 1997), p. 47. The debate took place on October 12, 1967.
44
L. Febvre, L’Europe: Genèse d’une civilisation (Paris: Perrin, 1999), p. 305.
45
C.R. Ageron, La décolonisation française (Paris: Armand Colin, 1991), p. 109.
 The Myopia of the European Community 55
[b]ecause it contains 8 million unassimilated Muslims, Algeria is not a French prov-
ince like any other, Artois or Normandy for example. At the same time, because it
contains 1 million Frenchmen who run everything, neither can it be a Muslim nation
state. We reject absolutely this idea of an Algerian nation state that bears no relation
to any historic or ethnic reality.46
A year later, following the disastrous defeat at Suez, François Mitterrand could still
write that “without Algeria there will be no French history in the twenty-first cen-
tury.”47 In 1959, Esprit magazine published an interview with a soldier ordered to
execute members of the Algerian resistance after they had been tortured. The
French soldier allowed that it wasn’t “a very easy job,” but believed nevertheless
that he was combating criminals and communists: “after a while I didn’t think
about it too much, but the first one was hard.”48 The defeat in Algeria and its
consequences—the return of the pieds noirs and the debates over the methods used
by French soldiers in their war on terror, the strife provoked in France by the con-
flict, and the discussions on the ever-higher costs of colonial policies—were all
factors which favored retreat within national borders. Todd Shepard, in a seminal
study published in 2006, has gone so far as to argue that in 1960 the identification
of French citizenship with the Hexagone and continental Europe could only take
place after Algerians had been definitively labeled as Africans with no right to
French citizenship in 1962.49 A period of national forgetting ensued, in which
questions of responsibility for colonialism were strenuously avoided in the name of
progress and modernity, but such memories would return to trouble the tranquil
face of French identity like a “ghost that would not pass.”50
Having lost the war, Italy was forced to surrender its colonies; its only remaining
overseas commitment was the temporary administration of Somalia. Anticolonial-
ism was thus a choice adopted out of convenience rather than a strategy born of
conviction. In 1960 the Africanist Carlo Giglio wrote in the weekly newsmagazine
Epoca a glowing analysis of both the British Commonwealth and the Union
Française as civilized instruments to prevent racial segregation. He believed Italy’s
colonial experience, in particular that accumulated after the First World War, to
have been an experiment which had the natives’ best interests at heart.51 Until the
beginning of the 1970s Italian historiography on Africa continued to praise the

46
Cited in Cruciani, L’Europa delle sinistre, p. 96.
47
Chipman, French Power in Africa, p. 28.
48
P. Leuliette, “Aventures d’un parachutiste,” in Esprit, April 1959, p. 65.
49
T. Shepard, The Invention of Decolonization. The Algerian War and the Remaking of France (Ithaca,
NY: Cornell University Press, 2006); although the same kind of approach had been taken as early as
the 1970s in many of the works of Henri Wesseling on the Netherlands.
50
For a book that extensively documents the traumas of decolonization see M. Thomas (ed.), Eu-
ropean Decolonization (Aldershot: Ashgate, 2007); J.L. Miège and C. DuBois, L’Europe retrouvé. Les
migrations de la décolonisation (Paris: l’Hamattan, 1995).
51
B. Bagnato, “Alcune considerazioni sull’anticolonialismo italiano,” in E. Di Nolfo, R.H. Rainero,
and B. Vigezzi (eds), L’Italia e la politica di potenza in Europa (1950–60) (Milan: Marzorati, 1992),
pp. 289–317. See B. Bagnato, L’Europa e il mondo. Origini, sviluppo e crisi dell’imperialismo coloniale
(Milan: Le Monnier, 2006).
56 After Empires

country’s colonial past, so much so that the authoritative reference remained that
written by Raffaele Cascia under the Fascist regime.52 Even in 1967 when, with the
exception of Portugal, all the European nations had given up control of their colo-
nies, a historian and public intellectual like Arturo Carlo Jemolo could argue, in a
debate with the Communist philosopher Nicola Abbagnano, that not all civiliza-
tions were equal, and that Western civilization was undoubtedly superior.53
The Dutch historian Henri Wesseling has written:
Every Dutch student learned, beginning in elementary school, that nature had been
tight-fisted with raw materials on his home soil. Every Dutchman who wasn’t barri-
caded inside his home was forced to realize that his country was cold and damp, and
densely populated. New Guinea, on the other hand, seemed to have everything the
Low Countries lacked: Sun, space and raw materials.54
In Holland before the loss of Indonesia, a popular saying warned that “if the Indies
are lost, the Low Countries are fucked”. History would demonstrate otherwise.
But whatever the popular frustration at the loss of the colonies, it could be trans-
formed only very slowly—if indeed it ever has been—into enthusiasm for
Europe.
The complexity of western Europeans’ attitudes, torn between hostility toward
the Africans, the desire for peace and tranquility, and disinterest in colonial mat-
ters, was visible in the reactions to the last-ditch intervention of Belgian paratroop-
ers in the Congo, at Stanleyville in November 1964, to rescue white citizens under
siege from armed rebels tied to Lumumba. It would be the final act of this small
federal state as a great global power. The immediate reactions of Belgian citizens
from various regions and social classes were captured by a journalist for La Libre
Belgique:
A town clerk: I followed it only from a distance but in general I’m “in favor.” It was
necessary to do something to save our citizens from the hands of those savages.
A pharmacist: It’s not good to intervene in a foreign country, but we did right to save
the lives of our citizens. Let’s hope that the Congo can develop itself with the help of
Belgian assistance.
A professor at the Conservatoire: A fever kept me from reading the papers and listen-
ing to the radio the last few days. However I believe the responsibility falls on all those
who in forty-three years of colonization did nothing to train one single black official
or engineer. And yet there have been many priests and bishops of color.
A prelate: I’m in favor of the intervention as long as our soldiers return to Belgium
once the mission to save human lives is over.55

52
M. Lenci, “Dalla storia coloniale alla storia d’Africa,” in A. Giovagnoli and G. Del Zanna (eds),
Il Mondo visto dall’Italia (Milan: Guerini e Associati, 2004), pp. 109–10.
53
A.C. Jemolo, “Le civiltà non sono tutte uguali: Occidente e Terzo Mondo,” in La Stampa, July
23, 1967.
S. Romano, “Il Continente Africano fra petrolio e sapone,” in Il Corriere della Sera, December 5,
2007.
54
H.L. Wesseling, “Les Pays-Bas et la decolonization: Politique extérieure et forces profondes,” in
Opinion publique et politique extérieure, III 1945–1981 Actes du colloque de Rome (17–20 February
1982) (Rome: Ecole Française de Rome, 1985), p. 225.
55
La Libre Belgique, November 25, 1964.
 The Myopia of the European Community 57

The two most important western European political networks, those of the Chris-
tian Democratic parties and of the Socialists, both made overtures to the Third
World in the course of the 1960s, for rather different reasons. But their attitudes
remained markedly cold toward the requests made by the countries of the develop-
ing world in the global forum of international organizations.
The Nouvelles Equipes Internationales (NEI) were created in 1947 as an instru-
ment of cooperation between European Catholic and Christian Democratic par-
ties. According to Charles Rutten, one of the leaders of the Dutch Catholic Party
who participated at its founding congress, the name “had no meaning” and de-
rived simply from the need to avoid any religious references, rejected by the French
in the name of the laïcité of the state.56 Throughout the 1950s, above all because of
the influence of the French, Belgian, and Dutch Catholic parties, the organization
concentrated its attentions on the dangers presented by the Cold War and the
threat of international communism. In this context the NEI supported European
integration—and even the possible creation of an integrated European military
force—as a defensive instrument against communism.57 Any reference to ques-
tions of decolonization was diligently avoided. In 1960, however, during the course
of an NEI meeting in Paris on the relationship between the Christian Democrats
and the Third World, Paolo Emilio Taviani, one of the founders of the Italian
Democrazia cristiana (DC), recalled that:
[t]hanks to colonization, the majority of African populations without culture, without
tradition and without any history became “peoples,” and they learned what the con-
cepts “society” and “state” mean . . . We may not forget that the existence of modern
states like Ghana, Cameroon, Togo and Somalia would not have been possible if those
territories had never been colonized by the British, the French or the Italians.58
In 1961, the international Christian Democratic movement made an overture to
the Third World, and especially to Latin America, with an international conference
held in Santiago, Chile. The occasion marked their first effort to mine this poten-
tially rich vein of propaganda and influence, but in the event the needs and desires
of the peoples themselves were largely ignored. The Non-Aligned Movement was
warned that neutrality toward international communism was unacceptable, and
that any neutral position was in fact immoral: An early sign of difficulty in the
effort to find common ground between European and non-European peoples.
In 1965 the NEI assumed the new name European Union of Christian Democrats
(EUCD).59 In 1966, at its Fifth Congress, the split between the European and
Latin American contingents became official, when a EUCD majority refused to

56
Available online at: <http://www.ena.lu/integralite_interview_charles_rutten_haye_29_
novembre_2006_duree_20820-012500519.html>.
57
P. Chenaux, “Les democrats-chrétiens au niveau de l’Union Europèenne,” in E. Lamberts (ed.),
Christian Democracy in the European Union 1945–1995 (Leuven: Leuven University Press, 1997),
pp. 449–59; S. Delureanu, Les Nouvelles Equipes Internationales. Per la rifondazione dell’Europa
(1947–1965) (Soveria Mannelli: Rubbettino, 2006).
58
P. Van Kemseke, Towards an Era of Development: The Globalisation of Socialism and Christian
Democracy, 1945–1965 (Leuven: Leuven University Press, 2006), p. 262.
59
W. Kaiser, Christian Democracy and the Origins of European Union (Cambridge: Cambridge Uni-
versity Press, 2007).
58 After Empires

approve a resolution of its Latin American partners calling for an effort to stabilize
commodities prices with an international agreement. The Italian Christian Demo-
crats, more open to the ideas of Third World leadership, distanced themselves from
the positions of their German counterparts in the Christlich Demokratisches
Union (CDU).60 But despite such growing internal tensions, the Atlantic Alliance,
the market economy, and the anticommunist struggle remained the basis for the
international outlook of European Christian Democrats until the mid-1960s.
The story was only slightly different for the other great European political family,
the socialists. The Socialist International was reborn in Frankfurt in 1951, and its
headquarters based in London, underscoring the importance of the British Labour
Party in its reorganization. Europeans formed the vast majority of its member par-
ties, and financial backing for the organization was drawn exclusively from Euro-
pean party sources.61 Socialist doctrine on international relations—many parties
had officially distanced themselves from Marxism at the end of the 1950s in favor
of a free-market reformism, in order to position themselves as electorally legitimate
alternatives—still drew upon the thought of the prewar Austrian theorist Otto
Bauer, for whom progress down the road to socialism could only be achieved where
the leap forward to industrial capitalism had already been completed. The newly
independent nations, with their primarily agricultural economies, were not con-
sidered fertile terrain for socialist propaganda in the short term, until they had
experienced a measure of economic development to match their political inde-
pendence.62 Even as late as 1960, at their meeting in Haifa, Israel, the International
did not assume a clear anticolonial position. The presence of the French socialists,
who defended their government’s actions in Algeria, put a halt to any direct rela-
tionship with the alliance of the non-aligned and indirectly responded to the ques-
tion raised by Ho Chi Minh in his memoirs: “What I wanted to know—and this
precisely was debated in the meetings—was: which International sides with the
peoples of the colonial countries?”63 One substantial difference that separated the
Socialist International from the European Christian Democrats, however, lay in
the fact that the former did not consider the European Community as a forum
in which to consider development issues. This reticence cannot be explained solely
in terms of the influence of the British Labour Party, because of their conviction
that the ties between the Community and the African states were nothing more
than an extension of the colonial experience. Rather, European socialists placed
greater faith in the possibilities for action through multilateral economic institu-
tions. In 1961 the Socialist International organized a conference on development
held in Baden-Baden: Fourteen European experts were assembled alongside fifteen

60
R. Papini, L’Internazionale DC. La cooperazione tra i partiti democratici cristiani dal 1925 al 1985
(Milan: Franco Angeli, 1986), p. 291.
61
G. Devin, L’Internationale socialiste. Histoire et sociologie du socialisme international (Paris: Presse
de la FNSP, 1993).
62
J. Braunthal, History of the International 1943–1968 (London: Victor Gollancz, 1980).
63
Ho Chi Minh, “The Path Which Led Me to Leninism,” in Selected Works of Ho Chi Minh, vol. 4
(Beijing: Foreign Languages Publishing House, n.d).
 The Myopia of the European Community 59

Asian and fifteen African counterparts, while Latin America remained absent out
of respect for the preponderant role played in their hemisphere by the United
States. The conference opened with remarks by the Dutch economist Jan Tinber-
gen, who would become one of the primary European interlocutors in debates on
the Third World underdevelopment. It was the first step in a process that would
lead in 1962 to the Oslo Declaration, with which the Socialist International pre-
sented a new look to the nations of the South. European socialists, heavily criti-
cized at Baden, that would finally distance themselves from colonialism. They
acquiesced fully, however, to the American approach based on “modernization”
theory, according to which the developing countries themselves should be held
fully responsible for achieving growth, by rapidly adopting democratic systems of
government to make themselves more attractive to foreign investment. Tinbergen,
alone, proposed a system to stabilize profits from commodities exports. Otherwise,
the primary goals of Oslo remained to prioritize gains in productivity and elimi-
nate trade barriers between Western nations; the redistribution of wealth to the
South was accorded secondary status, relegated to increasing the availability of in-
ternational aid.
For their part, western European communist parties, while beginning to con-
template a multipolar international communism by the early 1960s, had not yet
distanced themselves sufficiently from the internationalist and anti-imperialist
policy of the Soviet Union, so much of which was concentrated on shielding the
USSR from the attacks of Beijing.64
The passing of imperial illusions had taught the Europeans a painful lesson on
the need to distance themselves from colonialism of a military type, and opened
the eyes of European politicians and organizations to the issues of the Third World.
But the ideas circulated by the leadership of the developing countries regarding the
need for structural changes to the international economy found no takers in Euro-
pean ministries. For individual citizens in western Europe the imperial illusion was
replaced with another mirage, based on optimism and hopes for a constant rise in
living standards, without consideration of the consequences for whatever hap-
pened to exist outside of national and European borders.

T H E WO N D E R O F M O D E R N I T Y: I N D E F E N S E
OF THE COMMON MARKET

European nations, destroyed by years of war, were revived through economic re-
construction, sustaining their high rates of growth throughout the 1960s thanks
both to the moderate wage policies of their trade unions, abundant public and
private investment, cheap oil and shrinking defense budgets. Western European
leaders were consistently able to raise domestic tax rates without provoking visible
signs of public protest because citizens were full of hope for their own future and

64
M. Bracke, Which socialism, whose détente? European Communists and the 1968 Czechoslovak
Crisis (Budapest: Central University Press, 2010).
60 After Empires

had faith in the positive role of the central government.65 Europeans could even
continue to believe they lived at the center of world culture; after all, the “old con-
tinent,” attracting three-quarters of the world’s travelers, remained the most
sought-after destination in global tourism.66
Growth in trade during the first half of the 1960s, first among the European
nations, and then between Europe and the other industrialized economies, was a
tangible and exciting phenomenon not quantifiable simply in terms of statistics
or the profits of exporting businesses. Modernity and mass consumption arrived
in western Europe later than in the USA, but by the beginning of the 1960s, even
citizens of relatively backward nations like Italy were endowed with the purchas-
ing power to buy new domestic technologies such as washing machines.67 Refrig-
erators, televisions, automobiles, radios, tires, and other consumer goods entered
more visibly into daily life, their brand names becoming synonymous with qual-
ity in many countries. In 1966 the Federal Republic of Germany surpassed the
United States in world commercial rankings in manufactures, a signal of western
Europe’s rebounding commercial strength.68 The most cited Western economists
revealed themselves to be incorrigible optimists, turning on its head the common
conception of their discipline as the “dismal science.” Financial resources, once
limited in number and inadequate in distribution, seemed ever more abundant
and ready for allocation in new investments. Roy Harrod’s economics textbook,
in its 1969 edition, asserted with an impudence characteristic of the spirit of
the decade that “full employment should be considered a structural feature of the
British economy.” Friedrich Hayek’s liberal theories, which described the power
of the state to regulate the economy as the “road to serfdom,” were seen instead as
vaguely irrational exaggerations. Collaboration between the public and private
sectors and a modest amount of investment planning were considered the key
ingredients in a miraculous growth formula. The state and the market would
move, as they should, hand in hand.69 The agricultural sector shrank in signifi-
cance before industry, and the fields emptied further as the rural population was
increasingly displaced toward the cities. Social inequalities and architectural trav-
esties aside, Western Europe and its cities were quickly overwhelmed by cement
and traffic jams, buses and streetcars, and all the other trappings of modernity.
This fascination with progress, and especially with technology, was inescapable for
even the most skeptical and discerning intellectuals. The Dutch director Joris
Ivens, in his documentary L’Italia non è un Paese povero (1960), commissioned by
the Italian Ente Nazionale Idrocarburi (ENI) run by Enrico Mattei, depicted an

65
Progressive taxation rates reached up to 70 percent of yearly earnings, and by 1970 general gov-
ernment taxes ranged between 20 and 30 percent of Gross Domestic Product. See I. Berend, An Eco-
nomic History of Twentieth-Century Europe (Cambridge: Cambridge University Press, 2006), p. 227.
66
A. Williams and G. Shaw, Tourism and Economic Development. European Experience (Chichester:
John Wiley & Sons, 1998), p. 107.
67
M. Nolan, “Consuming America, Producing Gender,” in R.L. Moore and M. Vaudagna (eds),
The American Century in Europe (Ithaca, NY: Cornell University Press, 2003), pp. 243–61.
68
M. Walker, The Cold War: A History (New York: Henry Holt and Company, 1995), p. 213.
69
S. Padgett and W.E. Paterson, A History of Social Democracy in Postwar Europe (London:
Longman, 1991), pp. 153–4.
 The Myopia of the European Community 61

enormous sulfide plant, along with other miracles of modern engineering, inter-
spersed with spaceships and science fiction backdrops through the eyes of a
dreaming child. Andrew Schonfield, in one of the most important and often-cited
economics texts of the 1960s, echoed this optimistic wonder at the industrialized
economies’ seeming invulnerability:
Since the collapse of the Korean War boom the industrial countries have generally
enjoyed the benefit of falling prices for the primary produce which they import and
the rising prices for industrial goods which they export. They would, of course, have
been ruined by this situation long ago, if they had depended for the prosperity of their
export trade on the buying powers of the primary producers. Because industrial coun-
tries have learned how to replace some primary products with synthetics and to reduce
their requirements of others by means of improved techniques both in manufactures
and in agriculture, they have become less dependent on other channels; and they have
seized it. The result of this increase in the volume of manufactured goods exchanged
among the advanced countries is that the share of manufactures in world trade, in rela-
tion to foodstuffs and raw materials, has risen dramatically.70
The Third World had become a global actor. It had started to organize itself to
defend its own interests and to create international bodies to further cooperation
but, paradoxically, its greater political significance seemed to carry diminishing
economic weight: The share of exports coming from developing countries had
shrunk from 26 percent of the world total in 1953 to 19 percent in 1970. The
principal problem facing western European economists and ambitious political
leaders like de Gaulle was not so much how to devise measures to deal with the
demands of the G77, but how to stabilize the international monetary system,
making it less dependent on the dollar and more responsive to the needs of the
wealthiest European nations. Guido Carli, head of the Banca d’Italia, recalled how
already by the beginning of the 1960s debates had sprung up in the heart of the
IMF on the need to increase international liquidity:
On the other hand, those countries that are still largely monocultural, after having
undertaken more or less demanding development schemes to raise their respective
income levels, exploiting to that end the substantial financial contributions of the
World Bank, now find themselves facing a foreign debt burden that appears to be
maturing rather quickly and that cannot continue to accumulate without pernicious
consequences. In addition, these same countries are witnessing a perceptible deteriora-
tion of their exchange rates with respect to the industrialized countries . . . the impor-
tant fact to emerge in the course of our discussions is their clear awareness of the
interdependence of such problems . . .71
The Europeans, however, had refused to acknowledge the requests of those in the
Third World to create and make available new reserve currencies.

70
A. Schonfield, Modern Capitalism: The Changing Balance of Public and Private Power (Oxford:
Oxford University Press, 1965), p. 23.
71
Archivio Storico della Banca d’Italia (ASBI), direttorio Carli, cart. 62, fasc. 1, fasc. 10, “Appunto
di Carli per Tremelloni,” Rome, September 27, 1962.
62 After Empires

Regarding commodities and agricultural products, developments within the Eu-

ropean Community nations had raised new dangers, particularly for countries like
those in Latin America that since the Second World War had placed their faith in
exports to European markets. The CAP, at least on paper, came into force in 1962
and protected European farmers from foreign competition by guaranteeing elevated
internal prices and exports of overproduction.72 In the autobiography of the French-
man Edgar Pisani, the first European Agricultural Commissioner from 1961–6, the
author does not reflect even once upon the effect of the CAP on the less developed
countries.73 But raw materials, whether agricultural or mineral, were even further
threatened by a new type of Western industrial model of production, which never
ceased to invent and produce substitutes for traditional natural resources.
Industrial development of new synthetic materials had ingrained itself so deeply
in the postwar world that its echoes were felt even in the art world. Take the case
of the Italian Alberto Burri, who moved from the use of natural materials like
cloth, tar, and sawdust in the 1950s to experiments with plastics, acrylics, and
“cellotex” insulation in the following decade. Gino Marotta also began to work
with Plexiglass, establishing a relationship of mutual curiosity with industries that
would go on to help popularize the use of materials derived from petroleum. At the
beginning of the 1960s, the Italian Montecatini (later Montedison) began to invest
in synthetics, for which it saw a bright future, even financing a journal called Plas-
tics and Elastomers. In its first issue, the esteemed Italian chemist and Nobel laure-
ate Giulio Natta wrote in an editorial that until recently there had been few types
of synthetic rubber, all inadequate to replace natural products, but warned that:
[i]t could be that the situation will change in the future as a result of the new rubbers
synthesized in the last few years after the discovery of polymerization.
There remains a substantial profit margin for synthetic rubbers, such that their produc-
tion will not depend primarily on reasons of political, economic, financial, or military ne-
cessity, as was the case at the dawn of that industry. Rather, they will be based on solid
economic principles that are valid even in a completely free market. It is those principles
that will justify the rise of synthetic rubber factories in many places throughout Europe.74
A cursory glance at the issues in the journal’s first year demonstrates how new
plastics and other similar synthetics being substituted for traditional materials were
making a profound impact on daily life. Synthetic materials were increasingly used
for the interior and exterior surfaces of homes, automobiles, or wherever rubber,
glass, and metals were used. Among the unlimited number of applications for the
new synthetics were automotive repair, road signs and signals, belts and garments,
tires, tables, chairs, food packaging, shipping, sails, tubing, disposable utensils,
bicycle helmets, toys, toilet seats, life preservers, and waste baskets. A minor

72
M.T. Bitsch, Histoire de la construction européenne de 1945 a nos jours (Paris: Ed. Complexe,
2004); A.C. Knudsen, “Creating the Common Agricultural Policy. Story of Cereal Prices,” in W. Loth
(ed.), Crises and Compromises: The European Project 1963–1969 (Baden-Baden: Nomos Verlag, 2001),
pp. 131–56.
73
E. Pisani, Un vieil homme et la terre (Paris: Seuil, 2004).
74
G. Natta, “Nuovi sviluppi della chimica macromolecolare nel campo degli elastomeri,” in (1963)
1 Materie plastiche ed elastomeri, pp. 1–10.
 The Myopia of the European Community 63

revolution that made the fortunes of more than a few European businessmen also
promoted a popular euphoria for the modern, and in so doing overwhelmed waste
management systems, producing an explosion of nonrecyclable waste. At the same
time, it freed the expansion of European economies—or so it seemed—from the
constraints imposed by the import of commodities from the Third World.
Popular enthusiasm for the modern was also generously supported by organized
labor. The European working classes appeared to be in the midst of a great transfor-
mation, from fiery supporters of class conflict to a new category of consumers, whose
needs were increasingly being met (or created) by advertising that had previously
targeted the housewife as homemaker.75 Union leaders, who vigorously supported
the creation of a social welfare state, were not necessarily interested in nor sensitive to
events happening outside their national borders. This phenomenon was recognized
early on by the Swedish economist Gunnar Myrdal, who noted that the creation of
the welfare state had produced such a strong confluence of fundamentally conserva-
tive interests that it constituted an almost insurmountable barrier against the types of
reform that might take into account the interests of the Third World:
The welfare state is nationalistic, indeed very much more so than a laissez faire type of State
would be. Thus tremendous forces of vested interests, often spread out among broad layers
of the citizens, are so created that they can be mobilized to abstain from policies for under-
developed countries. In this case, it is wrong to put the blame on the “capitalists,” as is often
done by some ignorant radicals. On this point the people are the reactionaries.76
Galbraith, focusing on the United States, took this observation a step further,
arguing that organized labor could no longer effectively oppose the government’s
foreign policy: The Cold War had brought with it massive investments in technol-
ogy that had strengthened the national economy, and with it salary and employ-
ment levels.77 The “free” European trade unions, like those in the USA, were little
interested in the debates under way at the UN, in the demands of UNCTAD, or
in the accusations of neocolonialism leveled against the Europeans. The Interna-
tional Confederation of Free Trade Unions (ICFTU), which until the end of the
1960s was dominated by the leaders of the Anglo-Saxon unions, paid little heed to
these matters except to reiterate calls for a rise in the living standards of the indus-
trialized nations, as a means of freeing more money to aid the underdeveloped.
If anything, the free European unions began to concentrate their attention on
European integration, as a means of incorporating migrant laborers and encouraging
investment in social policy throughout the continent in order to sharpen the
Common Market’s competitive edge.78 Even the French Confédération Generale

75
A. Sangiovanni, Tute blu: La parabola operaia nell’Italia repubblicana (Rome: Donzelli, 2006).
76
G. Myrdal, The Challenge of World Poverty. A World Anti-Poverty Program Outline (New York:
Pantheon Books, 1970), p. 299.
77
J.K. Galbraith, The New Industrial State (Princeton, NJ: Princeton University Press, 1967),
p. 408.
78
A. Ciampani, La Cisl tra integrazione europea e mondializzazione. Profilo storico del “sindacato
nuovo” nelle relazioni internazionali: Dalla Conferenza di Londra al Trattato di Amsterdam (Rome: Ed-
izioni Lavoro, 2000).
64 After Empires

du Travail (CGT) and the Italian Confederazione Generale Italiana del Lavoro
(CGIL), both members of the Soviet-backed World Federation of Trade Unions
(WFTU), which had previously attempted to block the Common Market and
shown an interest in the creation of a Third World trade union, began to move
closer to the Community by the end of the decade, after that body had demon-
strated such extraordinary growth in production, and to consider it a credible
forum in which to confront the business world.79
Initially it was the Soviets who attacked the creation of the EC as a device for the
self-preservation of its capitalist member nations. It was no coincidence that their
attacks intensified between 1961 and 1962, amid the heightened tensions of the
Cold War and the construction of the Berlin Wall, symbol of the division of
Europe. In this context the Western efforts at integration represented by the EC
signaled a disturbing trend in international politics for Soviet leaders, and espe-
cially for eastern European communists.
At the beginning of the 1960s the Soviet government began a concerted effort
with each individual member state of the Community to determine the treatment
that would be reserved for Soviet and eastern European products in the light of the
construction of the Common Market. Threats of retaliation were carefully cali-
brated to each specific bilateral relationship, with the express goal of dividing the
Six and creating fissures at the precise moment when Kennedy was proposing a
new transatlantic partnership. The country that experienced the strongest pressure
was France, in the effort to detach it from the ongoing integration process. This
was the diagnosis given by a panel of experts to the Council of Ministers:
The USSR portrays itself as the spokesman of the People’s Democracies, which, as
exporters of industrial and agricultural products (while the USSR primarily exports
commodities), feel particularly threatened by the creation of the Common Market.80
The Soviets launched similar attacks through their initiatives to strengthen their
relationship with the countries of the Third World. In the official letter of September
17, 1962 with which the Soviet Foreign Minister Andrei Gromyko asked the
United Nations to call for an immediate conference on international trade re-
form—which would ultimately become UNCTAD—Moscow’s strongest words
were reserved for the European Community, defined as a “closed group” primarily
responsible for the discriminatory terms of global commerce.81 In a March 1963
interview with a Brazilian daily, Khrushchev expounded the well-known theory
that suggested the industrialized Western nations were imperialist powers which
needed “appendages” to supply them with raw materials.82 He added that, accord-

79
I. Del Biondo, L’Europa possible. La Cgt e la Cgil di fronte al processo di integrazione europea
(Rome: Ediesse, 2007).
80
HAEU, CM 2–1962, 1078, “Aide-Mémoire, Problèmes posés par le projet de declaration soviet-
ique concernant la cooperation économique internationale présenté dans la cadre de l’ONU (Résumé
des échanges des vues intervenes en cette matière au sein du Groupe de travail de relations extérieures),”
February 21, 1962.
81
HAEU, CM 2–1962, 1078, lettera a Émile Noël con allegato, September 22, 1962.
82
HAEU, CEAB 05/1996/1, “Extrait de l’interview accordée par M. Kroutchev a la Hultima Hora
de Rio de Janeiro, March 29 and 30, 1963.”
 The Myopia of the European Community 65

ing to the most careful economic statistics, the Latin American countries lost
roughly US$1.5 million annually because of the difference in the price of manu-
factures and raw materials, and upped the ante by claiming that in the the previous
decade Western aid to Latin America had failed to equal the amount lost to the
decline in the prices of raw materials. The USSR sought in this way to shift atten-
tion from what was likely its primary goal in reopening talks on international
trade: Re-stimulating the flow of goods between eastern and western Europe.
For their part the nations of Latin America, among the strongest supporters
of the Geneva Conference albeit far from falling under the spell of international
communism, also sided openly against European integration. In the Altagracia
Charter,83 signed at the conclusion of a coordinating meeting of Latin American
nations in preparation for the first UNCTAD, the trade agreements between the
EC and the African states came under heavy criticism, with the charter calling for
their abolition or, in any case, some form of compensation for the alteration of
international exchange.84
The newly independent nations were beginning to take an interest in the global
economy, and the Community had immediately been put in the dock. And it was
not only the Soviets, or the G77 nations, that attacked the EC for its role in the
international economy.
The primary role assumed by the European Commission was thus to defend
integration. Accordingly, it attempted to gather together all the charges leveled at
the EC, and to deploy all its persuasive diplomatic tools and counterarguments in
response. One inventory of such criticisms listed some forty-three possible offenses,
along with their respective defenses. The accusations ranged widely: That the Com-
munity constituted nothing more than the economic arm of NATO; that it was
dominated by the church and the Catholic parties; that it widened regional dis-
parities potentially generated by the Common Market; and that the CAP would
impoverish small farmers to the advantage of large agribusiness.85 In the negotia-
tions leading up to the first UNCTAD it had been decided that only four policy
areas should be subjected to the joint coordination and decision of the Six. It was
not a coincidence that all four were areas the Six sought to defend: The CAP, the
Common Market, the Yaoundé Convention, and the association agreements with
Greece and Turkey.86
At the GATT ministerial meeting of May 1963 the British government—whose
admission to the EC had been rejected by France only shortly before—presented a
ten-point Action Programme which called for the liberalization of world trade
across all sectors. This program greatly resembled a similar document already

83
NA, FO 371/178085, British Embassy, Santiago, April 24, 1964.
84
HAEU, CM 2–1964, 841, Commission, “Memorandum élaboré au vue de la Conférence des
Nations Unies sur le Commerce et Développement,” March 23, 1964.
85
HAEU, CM 2–1962, 122, Note, “Critiques à l’égard de la Communauté dans le cadre des
Nations Unies,” November 8, 1961.
86
HAEU, CM 2–1964, 845, Note, “Procédures suivant lesquelles les points de vue de la Com-
munauté et des Etats members seront exprimés lors de la Conférence Mondiale de l’ONU sur le
Commerce et le Développement,” February 19, 1964.
66 After Empires

presented by the developing countries to GATT, of which India had been the pri-
mary signatory.87 The British strategy was to bypass UNCTAD and use GATT to
address several of the problems advanced by the Global South:
We think that the Action Programme is important not only with respect to the Rus-
sians, but also as a demonstration of the practical work that GATT is doing to help
the Less Developed Countries. We think we should not be forced to adopt a less liberal
stance simply because the EEC is not with us. We place our faith in the fact that the
most liberal elements in the EEC will be aided by the continual pressures on the EEC
to assume a more liberal attitude.88
In the event, the Six succeeded in finding the cohesion necessary to oppose an
Anglo-American policy that, in the name of solidarity with the developing world,
threatened the Common Agricultural Policy and thus risked endangering one of
the very pillars of integration.89 The European Commission, so often described as
an institutional monolith, was and remains today a collegial body subject to vari-
ous pressures. In fact, while the remarks of Jean Rey, Commissioner for External
Relations, reflected an effort to find potential points of accommodation with the
requests emerging from the Third World, the German president Walter Hallstein
demonstrated the impact of a culture—widely shared among the leadership of a
postwar Germany strongly opposed to Nazi centralization—that viewed the free
market as a strategic tool for development and the reduction of poverty. In a 1965
speech Hallstein, dismissing every inconvenient argument in favor of trade prefer-
ences and the organization of raw materials markets, outlined a plan of action in
complete harmony with American designs:
The European Economic Community wants to take this opportunity [GATT negotia-
tions] to promote the productivity and expansion of the economy, to raise the living
standards of the poorer countries, as well as of the Six, and to bring about a better
distribution of labor in the world economy by liberating the natural forces of free
competition.90
Edward Heath, who represented the British government at UNCTAD I, recalled
without any undue modesty how the common culture of Oxford men—which
linked the British and Algerian delegations—was decisive in enabling a compromise
with the countries of the South. The British role at Geneva would be to create
sufficient consensus to promote significant tariff reductions in GATT.91 In 1964,
as we have already mentioned, the Labour Party had returned to power after

87
NA, Foreign and Commonwealth Office (FCO) 371/172271, “Brief, United Nations Confer-
ence for Trade and Development: Second Meeting of the Preparatory Committee, May–June 1963.”
88
NA, FCO 371/178076, “Brief for visit of Sir Patrick Reilly and Mr Golt to Washington, UN
Conference for Trade and Development.”
89
NA, FCO 371/172274, Memorandum, “Preliminary Considerations on items listed in the pro-
visional agenda of the conference,” May 24, 1963.
90
Address by Professor Dr. Walter Hallstein, President of the Commission of the European Eco-
nomic Community, given at the British Institute of International and Comparative Law, London,
March 25, 1965, 3574/X/65–E. [s.l.]: Commission of the European Economic Community, 1965.
91
E. Heath, The Course of My Life. My Autobiography (London: Hodder & Stoughton, 1988),
p. 604.
 The Myopia of the European Community 67

fourteen years in opposition. If in domestic policy Labour distinguished itself

with important innovations on the terrain of democracy and civil liberties, in
foreign policy its new course betrayed a stubbornly optimistic analysis of the
room for maneuver open to the UK. Its opposition to efforts to organize com-
modities markets, an idea put forward by the French and given lukewarm sup-
port by the other countries of the Community, derived from its very different
conception of its past relationships with former colonies. Great Britain had not
conceived of its colonial sphere of influence as an economic bloc divided into
producers of manufactured goods and raw materials, and in this sense was heav-
ily critical of Yaoundé: “The new convention represents the acceptance on the
part of France’s partners in the EEC of the principles and practices of French
colonial economic policy.”92 The British also accused the French of having influ-
enced their partners in the Common Market by threatening to block the course
of integration. It was believed that by attacking the association policy of the
Community in an international gathering it would be possible to modify it for
the future:
If Part IV of the Treaty of Rome did not exist, it would have been much more difficult
for France to bury the GATT Action Programme in 1963 . . . If it doesn’t concern us to
see the Six support French ideas rather than our own, if we don’t dislike it that the Six
accept special responsibilities towards Africa, that’s all well and good. But if we don’t
like to lose, and we have our own ideas that we want to prevail, then we certainly
might adopt a less ineffectual strategy.93
One of London’s primary concerns was to avoid concessions on the increase of
funds for development aid. The government feared being constrained to allocate
resources desperately needed for domestic use.
Countervailing pressures did exist, particularly within British public opinion,
which favored cooperation with the South. It should suffice to recall how in 1953
Wilson himself had given to the press a book on the war on poverty, in which he
had posited that some 3 percent of British GDP should be earmarked for such a
battle.94 But times had changed, the resuscitation of the empire had failed, and
London sought to avoid all discussion of development aid and the form this should
take.95 In this respect there were also notable differences not only with the French,
who had no difficulty accepting an aid target of 1 percent of GDP—particularly
since it had already surpassed that mark by 1964—but with other Community
nations like the Netherlands that placed a heavy priority on aid as a motor for
development.
While trade among the states of the Community grew both inside the Common
Market and with third parties, Great Britain continued to wrestle with balance of

92
NA, FO 172282, “Memorandum, Association of African Territories.”
93
NA, FO 371/178077, “Brief on the EEC and Developing Countries for the UN Trade
Conference.”
94
H. Wilson, The War on World Poverty (London: Gollancz, 1953).
95
NA, FO 371/172268, Cabinet, GATT Policy Committee, “United Nations Conference for
Trade and Development,” January 1963.
68 After Empires

payments problems. In 1964 it was forced to introduce a special 15 percent surtax

on all imports, and in 1967 to make the humiliating decision to devalue the pound
by 14.3 percent—which also implied, of course, a consequent decline in the value
of British development aid.96 If Community imports from the developing coun-
tries grew in the course of the 1960s, in England such imports dropped from 37 to
24 percent from the beginning to the end of the decade. Accompanying the British
loss of economic weight was the symbolic military retreat from its bases east of
Suez,97 a decision taken in 1967 by Wilson, who thereby bid Britain’s imperial role
in the Middle East a formal farewell.98
France’s first reaction to the preparations for UNCTAD was defensive: The govern-
ment feared that the conference might reopen debates over the CAP and the Yaoundé
Convention, which had been depicted as a neocolonial imposition. Discussions on
preferences for manufactured goods left Paris cold, and the widespread thinking
throughout the Quai d’Orsay was that they would privilege only four or five relatively
developed countries: India, Brazil, Egypt, and Pakistan (sic) chief among them.99 The
French government was at the front of the line in opposing the conference, and actu-
ally chided their Dutch colleagues for their weakness.100 France found itself in the
position of having to respond to the threat posed by the ten-point program announced
by the British Prime Minister Macmillan in the GATT negotiations, which, according
to the analysis of French diplomats, was receiving broad support:
The elimination of these “obstacles” would seem to be the primary concern on the
commercial plane of the underdeveloped countries not associated with the EEC.
There seems to be no doubt about the fact that their delegates have been for the most
part seduced by liberal doctrine, the influence of which is beginning to assume all the
features of intoxication.101
It was at the GATT ministerial conference of 1963, and later again at the second
reunion of the UNCTAD preparatory commission, that the French government
elaborated its economic strategy for the Third World, aimed at countering the
spread of this “liberal intoxication,” which would go by the name “organization of
markets.” In essence, the French strategy recycled a principle and a plan that Paris
had long put into practice in its colonies.102 The fundamental idea was that to in-
crease incomes in the commodity-producing nations it was not enough simply to

96
G. Mammarella, Storia d’Europa dal 1945 ad oggi (Bari: Laterza, 1995), p. 325.
97
J. Tomlinson, “The Commonwealth, the Balance of Payments and the Politics of International
Poverty: British Aid Policy 1958–1971,” in (2003) 4 Contemporary European History, p. 415.
98
R. von Albertini, La decolonizzazione: Il dibattito sull’amministrazione e l’avvenire delle colonie tra
il 1919 e il 1960 (Turin: Società editrice internazionale, 1971), p. xiii.
99
AMAEF, NUOI, Carton 998, “Question de la convocation d’une Conférence internationale
chargée d’examiner les problèmes du commerce,” 1962.
100
AMAEF, NOUI, Carton 998, Note, “Instructions pour la delegation française au Comité pre-
paratoire de la CNUCED,” January 1963.
101
AMAEF, NOUI, Carton 998, “Deuxième session du Comité préparatoire de la Conférence
mondiale pour le commerce et le développement (Géneve May 22–June 28, 1963),” July 10, 1963.
102
By 1962 a serious debate had begun in journals close to diplomatic and governmental circles
regarding the possible creation of international stabilization funds for raw materials: See G. Ardant,
 The Myopia of the European Community 69

open to them the markets of the industrialized countries. The French position was
developed further in an important memorandum of February 1964. It recognized
that there were significant imbalances in world trade that adversely affected the
prices of primary resources.103 For tropical industries, exclusively the domain of the
South, it was vital to determine an appropriate price, below which there would
have to be intervention by transferring resources directly to the producer nations
(the principle behind the CAP). As for developing countries’ requests to increase
exports of their own manufactures, the French proposal was to follow the lead of
the European Community which, to avoid the loss of international liquidity, had
chosen regional integration and the reciprocal rise of exports. That is, the poor na-
tions would have to intensify trade among themselves rather than count solely on
imports from industrialized countries.
The American ambassador in Paris came away impressed not only by the appeal
of the French proposals, but also by their internal contradictions: “when the LDCs
declare themselves in favor of the organization of markets, at the same time they
demand the abolition of customs barriers.”104 The organization of markets clearly
had its limits. Primary among them was that it potentially affected all commodities
except the agricultural products of which France was a primary producer and
which were defended in Europe by the CAP. It was justly noted that “the usual
tactic of the French consists of pointing out those elements of French policy which
agree with the demands of the Third World (aid, the organization of markets)
while hiding behind the EEC on more controversial matters (protectionism).”105
Notwithstanding his much-discussed trip to Latin America in 1964, when he
spoke Castilian Spanish and incited the crowds with the phrase “marchamos mano
en la mano,” de Gaulle’s Thirdworldism did not envisage the new nations playing
a meaningful role as a real interlocutor with the traditional great powers.

T H E A L G I E R S C H A RT E R

We have already seen how the years 1966 and 1967 were full of dark omens for the
developing countries. In 1965 Sukarno’s regime in Indonesia, which had spon-
sored the Bandung Conference and contributed to the birth of the Non-Aligned
Movement, was overthrown and replaced with a “pro-Western” military dictator-
ship. In 1966 Nkrumah died, and with him the primary—and increasingly the
only—supporter of African unity and autonomy. We have already mentioned the
death of Che Guevara in Bolivia in 1967, during his effort to export the Cuban

“La réforme des échanges internationaux par la création d’un fonds de stabilization des matières
premières,” in (1962) 9–10 Tiers Monde, pp. 115–41.
103
HAEU, CEAB 05, 2016, “Aide-mémoire du gouvernement français sur certaines questions a
l’ordre du jour de la Conférence des nations unies sur le commerce et le développement,” February 14,
1964.
104
National Archives and Records Administration (NARA), Central Policy Files (CPF), FT3, Box
962, Paris Embassy, “UNCTAD—French Reaction,” July 8, 1964.
105
Adda and Smouts, La France face au Sud, p. 123.
70 After Empires

revolution to South America. The American intervention in Vietnam, which ex-

panded massively after the Gulf of Tonkin incident in 1964, also grew in intensity,
as did feelings of revulsion for US foreign policy and the South Vietnamese gov-
ernment. But, at least until the North Vietnamese Tet Offensive of 1968, the most
vitriolic criticism of American military action came primarily from the Soviet bloc
of states, while in the West such critics remained at the margins of society. With
the notable exception of de Gaulle, busy breathing life into his “empire of words,”
most European governments prudently avoided openly contradicting the propa-
ganda emanating from Washington, which portrayed its Marines valiantly defend-
ing the cause of the free world in Southeast Asia. Even the Socialist International,
divided between the British, Dutch, and Danish on one side, and the more critical
Italians and Swedes on the other, “barred any consideration” of the issue at its 1966
Stockholm Congress.106
The impression of Western technological and tactical superiority was particu-
larly striking following the shocking swiftness of the Israeli victory in the Six
Days’ War. The Israeli offensive began on June 5, 1967 with an incursion against
Egyptian air bases, and within less than a week the Israeli army had occupied
several strategic positions within Egypt’s allies Jordan and Syria. The Israeli De-
fense Force also occupied the holy city of Jerusalem. The Israeli Blitzkrieg dem-
onstrated the military strength of a Western army in the open field, but at the
same time it created the conditions for the radicalization of the Palestinian na-
tionalist movement, which could now claim to be fighting for the liberation of
the “occupied territories.” On this occasion the European powers once more
sided against Nasser, who the press continued to depict as the “Egyptian Hitler,”
assisted in this portrait by his calls for the annihilation of Israel which Egyptian
radio had broadcast shortly before the onset of hostilities. In France, strange
bedfellows like Mitterrand and Giscard d’Estaing, or Sartre and Raymond Aron,
found themselves side by side signing petitions and disseminating appeals in
favor of Israel.107 But even here, as Tony Judt noted—and as we shall see in the
next chapter—the contradictions implicit in such views would soon make them-
selves apparent:
The Old European Left had always thought of Israel, with its long-established Labor
leaders, its disproportionately large public sector, and its communitarian experience,
as “one of us.” In the rapidly shifting political and ideological currents of the late
1960s and early 1970s, however, Israel was something of an anomaly. The New Left,
from Berlin to Berkeley, was concerned less with exploited workers and more with the
victims of colonialism and racism.108

106
G. Devin, “L’Internationale Socialiste face à la guerre du Vietnam,” in C. Goscha and M. Vaïsse
(eds), La guerre du Vietnam et l’Europe (1963–1973) (Brussels: Bruylant, 2003), pp. 215–22.
107
H. Laurens, “1967: A War of Miscalculation and Misjudgment,” trans. Krystyna Horko, in Le
Monde Diplomatique, English edition (June 2007). Available online at <http://mondediplo.com/200
7/06/09warofmiscalculation>.
108
T. Judt, Reappraisals. Reflections on the Forgotten Twentieth Century (London: Vintage Books,
2008), p. 280.
 The Myopia of the European Community 71

Nasser, a leader of the Non-Aligned Movement who had enjoyed great prestige
from his victory at Suez, emerged discredited as a regional interlocutor in the Arab
world, although he remained popular with his countrymen. With him the vision
of a secular, socialist pan-Arabism appeared in decline. The Arab countries found
themselves rudderless; the oil blockade of Arab oil producers had failed its pur-
pose, while at the fourth summit of the League of Arab States held in Khartoum
the moderate line captained by Saudi Arabia, fundamentally opposed to any rise in
oil prices, emerged triumphant.109
The 1950s and 1960s had been important decades for industrial development in
Latin America. Between 1945 and 1973, Mexico’s productive capacity quadru-
pled, that of Brazil grew eight times. The largest Latin American countries, from
Brazil to Chile, Argentina to Venezuela, had undergone extraordinary socioeco-
nomic structural changes: Between 61 and 81 percent of their inhabitants now
lived in urban areas, while the industrial sector had grown to employ between 30
and 42 percent of their workforces. But this development had come at the price of
a vigilant protection of national industry from foreign competition, a dwindling
presence on world export markets, a neglect of the agricultural sector, and a toler-
ance for high levels of social inequality.110 Overall, with the exception of countries
like South Korea or Taiwan, which had concentrated on developing an economy
based primarily on exports, the economic outlook for the developing world ap-
peared no more rosy than its political situation. In a 1967 study, an MIT econo-
mist noted with exaggerated emphasis the structural weakness of the South’s
economies: The industrial world could do without its commodities and, given
time, could even learn to replicate the taste of coffee; new oil deposits were being
discovered, for example those in the North Sea, that would make the West less
dependent on its oil reserves; the industrialized countries were already self-suffi-
cient in food production, and agreements on sugar cane between Cuba and the
USSR were not replicable for other goods; in short, the only countries of the South
that held any hopes for development were its largest nations, like India, and its
largest oil producers, like Algeria. Overall, the American economist concluded,
“the South is becoming irrelevant for the economies of the industrialized na-
tions.”111 This interpretation would prove incorrect, and failed to take into consid-
eration just how much the growth in industrialized countries still owed to imports
of raw materials and commodities. But the comments were nevertheless indicative
of a widespread sentiment among international economic experts.
What was really occurring was the onset of differentiation within the developing
world. In almost all the countries of the South, democratic experiments were giving
way to authoritarian temptations, whether these were motivated by social

109
E. Rogan, The Arabs. A History (New York: Basic Books, 2009), pp. 363–4.
110
Frieden, Global Capitalism, p. 308; L. Zanatta, Storia dell’America Latina contemporanea (Bari:
Laterza, 2010), pp. 144–90.
111
Miguel Wionczek (ed.), Economic Cooperation in Latin America, Africa, and Asia (Cambridge,
MA: MIT Press, 1969), p. 3.
72 After Empires

progressivism or, more likely, conservatism. Some nations with close ties to the US,
like Brazil and South Korea, placed their hopes on investment in export-leading
industries. Others continued to invest in the development of domestic markets.
Whatever their goals, such industrialization also produced dramatic social ten-
sions, income inequalities, and the haphazard creation of mega-cities that were
unable to offer jobs and services to all their citizens, with greater or lesser capacity
to attract aid and private investment.112
The charismatic and organizational void left by the absence of the historical lead-
ers of the Non-Aligned Movement could not be filled by Soviet support. Although
it conducted an active foreign policy in the areas of technical and military assistance,
the USSR had decided to focus its influence on a select few strategic nations, rather
than give blanket support to the South. At the meeting of Central Committee that
deposed Khrushchev in October 1964, the ousted premier was criticized for having
squandered Soviet resources on foreign aid, which committed it to some 6,000
projects around the world at an exorbitant cost to the economy.113 In January 1967,
the Soviet Foreign Minister Andrei Gromyko stated openly that conflict with the
capitalist world was not inevitable, and that it was necessary to concentrate Mos-
cow’s scant resources on the most progressive and promising nations for international
communism, states like Algeria, Egypt, Guinea, and the Congo.114 Khrushchev’s
optimistic crusade against the Western world, conducted with some support within
the United Nations, was followed by a lower-profile attitude under the new General
Secretary of the Soviet Communist Party, Leonid Brezhnev. Consolidating his lead-
ership at a moment of heightened tensions within the communist world, during the
conflict between the Soviet Union and China, Brezhnev returned Moscow to the
path of realism and its more traditional course of power politics: Negotiations with
the United States, and trade relationships with western Europe (such as the 1966
accord with the Italian automobile maker Fiat). In conversation with Prebisch, the
Soviet Minister for Foreign Trade pledged Moscow’s support for the cause of Third
World unity. They agreed upon the need to combat the European Community’s
regional trade preferences, but otherwise Moscow was completely indifferent to the
G77’s principal demands for commodities agreements and preferences for manufac-
tures, reiterating that the underdeveloped nations should invest primarily in heavy
industry—an area where the USSR could lend real technical assistance.115 Soviet
leadership believed that the main contribution the South could make to the cause
of world peace and prosperity was to support the reopening of trade between east-
ern and western Europe, in order to provide the Soviet Union with greater liquidity
to import goods from the G77 countries.

112
For a good synthesis of the economic evolution of the developing world see B. Droz and
A. Rowley, Storia del XX Secolo. Sviluppo e independenza (1950–1973) (Florence: Sansoni, 1989).
113
Andrew, The World Was Going Our Way, p. 7.
114
A. Dobrynin, In Confidence. Moscow’s Ambassador to America’s Six Cold War Presidents 1962–1986
(New York: Random House, 1995), p. 642.
115
United Nations Office in Geneva (UNOG), UNCTAD, ARR 40/2344B8, “Record of
Dr Prebisch’s conversation with the Minister for Foreign Trade of the USSR Mr N.S. Patolichev,
Moscow, July 27, 1967.”
 The Myopia of the European Community 73

Equally worrisome for the South at the second UNCTAD—held at New Delhi in
1968—was the revelation of the delicate economic state of the two great post–Sec-
ond World War Western powers, the United States and the United Kingdom. British
balance-of-payments problems and the consequent weakness of the pound have al-
ready been discussed. Even more important was the crisis facing the American dollar.
The financing of the Vietnam War, the constant shrinking of the country’s positive
trade balance, as well as the continuous leaking of capital for investments had left the
dollar dependent upon the support of the other Western nations. America’s increas-
ingly negative balance of payments was especially hard on the developing countries,
as it made any generous trade or development aid concessions by Washington ex-
tremely unlikely. Already by the beginning of 1965 criticisms were being voiced in
Europe, and especially in France, of the manner in which the dollar was being used
to finance Washington’s political and military hegemony—what is known in eco-
nomic jargon as the “power of seignorage.”116 Midway through the 1960s, however,
the monetary battle was above all a battle to harness the power of western Europe,
which in fact succeeded in winning veto power over all-important decisions of the
IMF.117 The proposal had already been made to institute a new reserve currency to
flank the troubled dollar, so-called Special Drawing Rights (SDRs), to be disbursed
in relation to an improvement in development aid, which had been in steady decline
and increasingly tied to imports from the donor nation. To all such efforts the mem-
bers of the European Community erected a unified wall of opposition.118
On June 30, 1967 the GATT negotiations known as the Kennedy Round came
to a close. This was the site of an important demonstration of strength by the
European Community, represented in the trade negotiations by the European
Commission. Intense debate continues to this day between economists and histo-
rians over which of the two sides of the Atlantic proved the more able negotiator.119

116
Robert Triffin cites the arguments made by General de Gaulle at a February 1965 press
conference:
Why should the two richest countries of the world be allowed to monopolize the benefits of inter-
national-reserve creation for the financing of their own deficits? Why should the Bank of France
be expected to participate—by its purchases of dollars—in the financing of United States policies
in which France has no voice and with which she might be in fundamental disagreement? Are not
the United States deficits ascribable, at least in part, to the flurry of United States private invest-
ments abroad (substituting United States for French ownership), to United States assistance to
Chiang Kai-shek, to the escalation of the war in Southeast Asia, and so on?
R. Triffin, Our International Monetary System: Yesterday, Today, and Tomorrow (New York: Random
House, 1968), p. 108. For a fine summary of the main points of the dollar crisis and the end of the
Bretton Woods system see B. Eichengreen, Globalizing Capital: A History of the International Monetary
System (Princeton, NJ: Princeton University Press, 1996), pp. 125–36.
117
T. Ferguson, The Third World and the Decision Making in the International Monetary Fund
(London: Pinter Publishers, 1988), p. 137.
118
D. Caviglia and G. Garavini, “Generosi ma non troppo. La Cee, i Paesi in via di sviluppo e i ne-
goziati sulla riforma del Sistema monetario internazionale (1958–1976),” in E. Calandri (ed.), Il primato
sfuggente. L’Europa e l’intervento per lo sviluppo (1957–2007) (Milan: Franco Angeli, 2009), pp. 53–89.
119
T. Cohn, Governing Global Trade. International Institutions in Conflict and Convergence (Burling-
ton, VT: Ashgate, 2002); L. Coppolaro, “US Payments Problems and the Kennedy Round of GATT
Negotiations 1961–1967,” in D.M. Andrews (ed.), Orderly Change: International Monetary Relations
Since Bretton Woods (Ithaca, NY: Cornell University Press, 2008), pp. 120–38.
74 After Empires

Whatever the answer, two things are certain. The first is that the Community suc-
ceeded in remaining united during one of its first international tests, defending the
CAP, and that it maintained this cohesion at a particularly delicate time for the fate
of integration. The second is that the clear losers of the Kennedy Round were the
developing countries, which pressed in vain for a decision on trade preferences for
their manufactures, or at least for the abolition of import barriers to tropical goods.
The European Agricultural Commissioner, Sicco Mansholt, alone underscored the
limits and risks of purely commercial agreements that ignored more complex ques-
tions related to development.120
Considering the political and economic weakness of the developing world, it was
by no means a given that the Asian, African, and Latin American countries would
succeed in elaborating a common line before the second UNCTAD. Criticism of the
G77 was not in short supply, particularly from other UN bodies like the Food and
Agriculture Organization (FAO) in which the industrialized countries had greater
weight, and which were competent to address the relevant issues. The FAO’s directors
did not hide their skepticism at G77 attacks on the CAP or the Group’s hopes of using
the forum to reach accords that would entail a rise in commodities prices.121
Different strategies were emerging behind the South’s united front. The African
nations, which were almost exclusively exporters of raw materials, had little interest
in preferences for manufactures, and asked above all for the deployment of any
type of aid to help them industrialize. Those nations with ties to the Community,
which already maintained privileged relationships with the Six, requested adequate
compensation in exchange for their acceptance of the extension of a system of
preferences for all the countries of the South.122 The Asian nations, led by India,
spent their energies trying to obtain as wide a system of preferences as possible, and
to this end were willing to act as go-between for the most radical delegations. The
Indian ambassador in 1964 had even let it be understood by the American govern-
ment that, should the GATT regulations be relaxed, India was prepared to negoti-
ate in that forum and relegate UNCTAD to secondary importance.123 The Latin
American states, meanwhile, were interested in both the question of commodities
and that of trade preferences. For Prebisch, in particular, the primary goal was to
avoid the consolidation of large regional economic blocs that would handcuff
Latin America to the United States, Africa to the European Community, and
Southeast Asia to Japan.124 Such an outcome would have entailed the disintegration

120
UNOG, UNCTAD, ARR 40/2344B7, H. Mathias to Dr Raúl Prebisch, “Important differences
of view between Mr Rey and Mr Mansholt regarding the results of the Kennedy Round and future
action that might be taken,” Geneva, July 18, 1967.
121
Food and Agriculture Organization Archives (FAO), 12 ESC, UN 29/1, D’Amico, “UNCTAD
paper on the development of an International Commodity Policy,” September 21, 1967.
122
NARA, CPF, FT3, Box 958, Report of the US Delegation of the Fourth Session of the
UNCTAD Conference, September 23, 1966.
123
NARA, CPF, FT3, Box 961, Memcon, UNCTAD (Indian Ambassador and Under-Secretary
Ball in New Delhi), August 22, 1964.
124
HAEU, CM 2–1965, Conseil, Note d’Information, “Examen des problèmes concernant la
prochaine reunion du Comité special des preferences de l’ UNCTAD,” May 4, 1965. The European
Commission representative expressed skepticism at multilateral preferences, and indicated that “to
resolve the problem for the three developing continents, each of the industrialized blocs (US, EEC,
Japan) could create a network of preferences along a North–South axis on the basis of the demands
presented by each of the three continents (Africa, Latin America, Asia).”
 The Myopia of the European Community 75

of the South’s united front, and for Latin America would have meant the inevitable
return beneath the yoke of subordination to the dictates of Washington.
Notwithstanding these significant differences, the states of the South continued
to reinforce the institutional mechanisms for their continued cooperation. In 1965
the Council for Trade and Development, UNCTAD’s largest internal body, met
for the first time, and within it the thirty-one states of the developing world set up
a coordinating committee.125 In 1966 the Asian, African, and Latin American re-
gional economic committees of the UN agreed to organize a joint conference at
ministerial level for the following year, to reconcile their differences in light of the
approaching UNCTAD meeting at New Delhi.
This conference was to take place in Algiers and was designed to map out the
final guidelines for the G77;126 it would also demonstrate the pattern of negotia-
tions that would characterize the South’s preparations: Meeting before UNCTAD
in regional assemblies, and then in a joint assembly at ministerial level, the highest
echelon of the G77, where a strategic document would be drafted for presentation
to the industrialized countries.
The Algiers ministerial conference was held from October 10–25, 1967 in an
atmosphere of extreme tension. Though Cuba had been denied admission by the
veto of the other Latin American states, in the hopes of dampening any anti-impe-
rial rhetoric, such polemics erupted instead against the delegation from South Vi-
etnam. The fundamental principle around which Prebisch had shaped UNCTAD
was that negotiations and debates should concentrate only on international eco-
nomic structures, and not on the domestic politics of individual Third World
member states. But the war in Vietnam had begun to cause radicals to dig in their
heels against Washington and its allies. Vociferous American protests could not
prevent the South Vietnamese delegation from first being forced to abandon their
residential quarters, under the pretext of threats to their safety, and finally to leave
Algiers altogether.127
It was the Algerian president Hourari Boumedienne who sought to repair the
damage. He had come to power in 1965, after a military coup overthrew the first
leader of an independent Algeria, Ahmed Ben Bella.128 In contrast to his predecessor,
Boumedienne was not a politician capable of exciting the masses; he lacked the
rousing charisma of the stump speaker. His military coup had been received with
indifference by the leaders of the developing nations, in particular those of the
African and Arab world who had come to admire Ben Bella as a symbol of resist-
ance to the French. He was considered more of a technocrat or a military man than
a pure politician, without the close ties his predecessor had enjoyed with the USSR.

125
Sauvant, The Group of 77, pp. 27–59.
126
NA, FO 371/19006, Note, “Preparation for the Second Session of the Conference,” September
23, 1966.
127
NARA, CPF, FT3, Box 957, Director of Intelligence and Research to the Secretary, “The Pre-
UNCTAD Meeting,” October 13, 1967.
128
G.P. Calchi Novati, Storia dell’Algeria indipendente: Dalla guerra di liberazione al fondamentismo
islamico (Milan: Bompiani, 1998); B. Stora, Histoire de la guerre d’Algérie (Paris: La Découverte,
2004).
76 After Empires

His critics in the Arab world, however, overlooked the fact that, in contrast with
many other Algerian leaders, including Ben Bella, Boumedienne had not been
educated in French schools, and had instead completed his university studies in
Cairo. The Egyptian defeat in the Six Days’ War had brought out his latent Arab
nationalism, and indeed it was from the humiliation of the Arab armies that he
drew the inspiration to immerse himself in politics and become one of the most
authoritative and radical heads of the Arab world.129
Boumedienne opened the Algiers conference with a violent attack on both the
West and the Soviet Union, criticizing the politics of peaceful coexistence between
the two superpowers for justifying the subjection of the rest of the world.130 On the
specific issue of the next UNCTAD, in contrast to the African and Latin American
delegations he argued against relying on the healing powers of commodity price
stabilization. An eventual rise in commodity prices would in fact play into the
hands of the West, since ownership of the industries responsible for extraction and
transformation of such raw materials was entirely in their hands. The real aim of
the South’s struggle should be to reappropriate the wealth of its land and develop
industries capable of transforming raw materials on the spot. If price stabilization
talks were necessary, he continued, they should include in the final document a
signal to open discussions on petroleum prices. In 1967 there did not seem to be
any consensus in favor of such a radical program implying “internal” structural
modifications, with the exception of China, which at any rate was not welcomed
as a member of the Group of 77.
Instead, the item on which the representatives of the Third World could find
agreement was the Algiers Charter, the final document of the G77 ministerial
conference.131 In essence, the document outlined a compromise between the Latin
American position, which demanded the abolition of special preferences, and that
of the African delegates, who requested adequate compensation in exchange for an
eventual abolition of their special preferences with the EC. Its evaluation of the
state of the global economy drew largely on the Prebisch Report of 1964, and if
anything even emphasized that report’s pessimism with the reminder that three
years had passed since the first UNCTAD without clear signs of a narrowing of the
gap between North and South. While the global annual income level of the average
citizen had risen by US$60 in that time, in the developing world wages had actu-
ally fallen by US$2. Purchasing power of exports from the developing world was
declining at a rate of approximately US$2.5 billion a year, and only half of this
decline was being compensated for by public aid from the developed nations.

129
On the Algerian international discourse, see J.J. Byrne, “Our Own Special Brand of Socialism:
Algeria and the Contest of Modernities in the 1960s,” in (2009) 33(9) Diplomatic History,
pp. 427–47.
130
AMAEF, NOUI, Carton 10000, Ambassade de France en Algérie, “Conférence des 77 à Alger,”
October 30, 1967: “Colonel Boumedienne’s speech, which contrasted the wealthy North with the
poor South, mainly irritated the ambassadors from eastern Europe. Their disappointment was even
greater at the end of the conference, given that all the members of the G77 accepted his proposed
plan.” Boumedienne, according to French diplomats, had spoken against “peaceful coexistence” at the
expense of the South, and advanced “ultragauchiste” ideas.
131
Charte d’Alger, Adoptée par la Reunion ministérielle du Groupe des 77, October 24, 1967.
 The Myopia of the European Community 77

Added to all this was the crushing weight of debt, which had grown from US$10
billion in 1955 to US$40 billion in 1966. In terms of potential solutions, the G77
proposed progressively eliminating barriers on raw materials and studying various
price stabilization mechanisms. At the same time—backed by the AASM—it was
proposed to undertake a study of the possible consequences of an eventual aboli-
tion of preferences on certain goods in order to mitigate any potential negative
effects. General preferences on manufactures were requested but, again with Afri-
can backing, it was declared that the most underdeveloped states would receive
special consideration. The other important request was to fix development aid at 1
percent of the industrialized states’ GDP.
The Charter was presented to the most important Western nations by a special
“goodwill mission” designed to alert leaders to the concerns of the G77. The name
given to the mission was not an accident: To obtain satisfaction for their demands
the developing nations would need a great deal of goodwill on the part of the de-
veloped world.
Negotiations among the Western nations were proceeding at the same time
within the OECD, rather than in the commission on preferences established by
UNCTAD. The United States softened its violently hostile stance against any
debate that might threaten the “most favored nation” clause and agreed in 1965 to
an OECD study on trade preferences. In an important speech at Punta del Este in
April 1967, President Lyndon Johnson declared that America was prepared to dis-
cuss generalized preferences.132 This was a bold American overture before the close
of the Kennedy Round, perhaps intended to make the outcome of GATT a pill less
bitter to swallow for the countries of the South. The primary motivation of the
Democratic administration, however, was fear of the fact that, after its eventual
enlargement by the admission of Great Britain, the European Community would
become the largest trading power in the world, requiring some form of opposition
to its tendency to grant progressively preferential agreements in the Mediterranean
and Africa.133
On November 30 and December 1 of that year an OECD ministerial confer-
ence was held to discuss the question of preferences in the light of the decisions
reached by the G77 at Algiers. Johnson had received the green light from the
United States Congress to move forward on the issue of preferences, on condition
that such mechanisms were opened to all the countries of the South and accompa-
nied by the elimination of inverse preferences by all that held such special prefer-
ential systems—which meant the Community.134 In the OECD meeting the

132
For a much-discussed book of 1967, dealing specifically with the question of trade preferences
for developing countries, see H. Johnson, Economic Policies Toward Less Developed Countries
(Washington, DC: Brookings Institution, 1967).
133
Foreign Relations of the United States (FRUS), 1964–1968, Vol. VIII, Memorandum from
Secretary of State Rusk to President Johnson, “A New Trade Policy for the United States,” Washington,
February 11, 1967.
134
NARA, CPF, FT3, Box 598, Action Memo from Anthony Solomon to The Secretary, “US posi-
tion on Tariff Preferences for Developing Countries,” November 24, 1967.
78 After Empires

Western states reached a general agreement on two points: First, the system of
preferences would include all the developing countries; second, to protect the
AASM countries tied to the Community, special treatment would be reserved for
the “less developed,” that is for the African states.
The issue most heavily debated before the New Delhi conference was, by far,
that of trade preferences.135 This was a potentially delicate question for the Com-
munity, which did not want to concede much in the area of processed agricultural
products and which was threatened with the future abolition of inverse prefer-
ences. The issue was even more pressing, however, for the Soviet Union: Moscow
could not afford to give up anything. The Soviet economy was a planned one, in
which the quota of manufactured imports depended exclusively on state decisions,
which made it very difficult to adjust to requests for greater imports from the de-
veloping countries, given that it had to give precedence to exports from eastern
Europe.136

A COMMON MARKET WITHOUT

A COMMON IDENTITY

The process of European integration as it appeared in the 1960s seemed a primarily

commercial project that promoted growth in the productive capacities of six Euro-
pean states—Belgium, France, Italy, Luxembourg, the Netherlands, and the Fed-
eral Republic of Germany—binding their economies closer together.137 Yet, as we
have seen, European economic cooperation was also based on a profound and
deeply rooted reciprocal distrust.138 An apparent paradox, described by Joseph
Weiler, was created in which the constitutional foundations of economic integra-
tion among the Six were steadily reinforced—backed by the decisions of the Euro-
pean Court of Justice in Luxembourg, which favored the free circulation of goods
within the Common Market—while national politicians sought to defend their
freedom of maneuver by questioning the legitimacy of the stateless bureaucracy in
Brussels. The fewer the opportunities that existed to exit the legal web of integra-
tion, the more national leaders raised their voice to undermine it.139 The EC, the
institutions of which had assumed greater power and control over certain areas of

135
NA, Bureau of Trade (BT) 241/1868, Paper by Commonwealth Office, “The Question of Pref-
erences,” January 1968.
136
NARA, CPF, FT3, Box 960, Strategy Paper, UNCTAD Trade and Development Board, April
5–23, 1965: “The Soviets will find themselves even more in the same situation as us and the other
developed states. They will find the same ingratitude for their aid. And they are even more vulnerable
to these attacks than we are when it comes to imports of those goods and commodities that the devel-
oping states are capable of exporting.”
137
On the commercial nature of the Common Market, which, until at least 1963, was dominated
by high-level pacts and considerations of national political prestige over notions of supranational
governance, see A.S. Milward, The Rise and Fall of a National Strategy, 1945–1963 (London: HMSO,
2002).
138
Puchala, “Western European Attitudes on International Problems,” pp. 266–79.
139
J.H.H. Weiler, The Constitution of Europe. “Do the New Clothes Have an Emperor?” and Other
Essays on European Integration (Cambridge: Cambridge University Press, 1999), pp. 10–16.
 The Myopia of the European Community 79

economic life, thus entered a static phase in terms of political cooperation, as dem-
onstrated by the “empty chair” crisis of 1965, only resolved the following year with
the decision by the Six to make all important decisions dependent on unanimous
voting.140 This situation could not but be reflected in the coherence of western
European governments’ actions in the international arena.
In 1967 Great Britain could no longer claim, as it had at UNCTAD I, to be a
credible or reliable partner to the developing countries. It had been forced to make
a second application for admission to the European Community, and received
another flat refusal by the French. It had been the victim of a grave liquidity crisis,
which prevented it from making any type of charitable contribution to Third
World nations. The devaluation of sterling that same year had signified not only an
admission of the weakness of its economy, with its negative trade balance, but also
a net decline in the worth of British development aid. In a speech of March 1967
Edward Heath neatly stated the new British attitude: The United Kingdom had
lost its position in the Third World, and the Commonwealth had been trans-
formed from a valuable network of allies into evidence of British inadequacy. The
United Kingdom could no longer continue to oppose agreements on raw materials
indefinitely, but would have to content itself with pressuring France to accept a
wider extension of trade preferences. Its primary objective thus became avoiding
the possibility that the East–West standoff might give way to a new conflict based
on the economic gap between North and South, and using its remaining influence
to persuade its friends in the European Community to this end.141
If economic conditions did not permit Great Britain to play its usual role, and
if the war in Vietnam was generating both internal tensions within the United
States and international hostility toward its foreign policy, the European Commu-
nity was also incapable of becoming the primary partner of the Third World states.
In contrast with GATT, where the European Commission represented the Six, in
UNCTAD Member States shared no such joint representation. Confronted with
the emergence of the developing world, the Community revealed itself for what it
was: Efficient as an instrument of European economic cooperation, but scarcely
credible as a political actor. Every effort to construct a model of integration based
on more stringent mechanisms of political or cultural cooperation had been re-
jected from within. France had been opposed to the creation of a Community
budget, to the point of threatening to withdraw from Brussels. European social
policy remained purely ancillary, inconsistent with respect to the creation of a free
market area devoid of any redistributive character.142 The proposed creation of a

140
For an explanation of the “empty chair” crisis as an example of this conflict, which constituted
an essential element of the model of European integration assumed during the 1960s, see N.P. Ludlow,
The European Community and the Crisis of the 1960s: Negotiating the Gaullist Challenge (London:
Routledge, 2006).
141
E. Heath, Old World, New Horizons. Britain, Europe, and the Atlantic Alliance (Cambridge, MA:
Harvard University Press, 1970), p. 66.
142
L. Mechi, “Le questioni sociali nel processo d’integrazione europea,” in La cittadinanza che
cambia. Radici nazionale e prospettiva europea Annali della Fondazione Giuseppe Di Vittorio (Rome:
Ediesse, 2005), pp. 241–58.
80 After Empires

European University at Fiesole (near Florence), which would throw a veil of cul-
ture over a predominantly economic body, had not gotten anywhere.143
The politics of national prestige remained extremely important, as did the ambi-
tions of its Member States to compete against each other for dominant positions
in Third World markets. Aid distributed by European states remained primarily of
a bilateral nature, and tended to be “linked” to—or directly financed by—exports.
While US government aid steadily declined in the years from 1965–70, the impor-
tance of aid from large European states like France and Germany steadily grew, as
to an even greater degree did the contributions of emerging donors like Canada,
Denmark, Sweden, and Holland, all of which placed more emphasis on multilat-
eral assistance.144 The President of the World Bank, George Woods, pushed hard
for a greater contribution to multilateral aid from the European powers, especially
Germany. The German government, however, barricaded itself behind its special
relationship with France, reiterating the importance that both countries placed on
bilateral aid and thus on national politics of cooperation.145
The Dutch Foreign Minister Joseph Luns, who headed the Netherlands Foreign
Ministry for almost two decades from 1952 to 1971, held the bar of transatlantic
foreign policy firmly in favor of Western economic institutions, above all GATT.146
One of the most salient characteristics of the Dutch economy was its heavy reli-
ance on the import of raw materials to feed important refined goods industries.
Through its multinationals—first among them Royal Dutch Shell, the most inter-
national of the oil multinationals since it had no oil at home—the Netherlands
made considerable foreign investment in the developing world. In the course of
the 1950s, one of the Dutch reactions to the end of colonialism had been to insti-
tute a program of multilateral development aid. The economist Tinbergen, Nobel
Prize winner in 1956, had developed for the Dutch Labor party a plan which
called for aid to the South amounting to 1 percent of GDP in addition to its mul-
tilateral aid commitments, as well as a project of international trade reform. Dutch
aid grew steadily throughout the 1960s. At the same time, however, bilateral aid
also increased—as did conditioned aid, which amounted to 90 percent of the total
by the end of the 1960s—in addition to foreign direct investment. Dutch relations
with the developing nations seemed to move simultaneously in two directions:
That of cooperation and aid, which pushed for acceptance of the South’s requests
for a partial modification of international commercial and financial mechanisms;
and that of trade and investment, which pushed for guarantees on foreign invest-
ment and promoted the progressive liberalization of world trade. An advertisement

143
S. Paoli, “La politica comunitaria in materia di istruzione nel corso degli anni Sessanta,” in
L. Leonardi and A. Varsori (eds), Lo spazio sociale europeo. Atti del convegno internazionale di studi,
Fiesole 10–11 ottobre 2003 (Florence: Firenze University Press, 2005).
144
J. White, The Politics of Foreign Aid (London: The Bodley Head, 1974), p. 228.
145
World Bank Group Archives (WBGA), Records of George Woods, Travel Files, Box 1, Steck-
ham, Mr. Woods’ visit to Bonn, January 1968.
146
E.H. Arens, “Multilateral Institutional-Building and National Interest: Dutch Development
Policy in the 1960s,” in (2003) 12(4) Contemporary European History, pp. 457–72.
 The Myopia of the European Community 81

by the Anglo-Dutch concern Unilever, aimed at attracting future management

candidates, revealed the strong economic interests concealed by an open-minded
stance toward the South’s demands:
AVIS UNILEVERENSIS (MANAGERIALIS):
Plumage: highly variegated; habits: too numerous to list; habitat: the world; dis-
tinctive characteristics: a high flyer. The birds who run Unilever come in many shapes
and sizes. For a marketing man, for example, a spell in a sales team in Yorkshire may
lead to experience in an advertising agency in London. Later, from London our man
may go to Brazil—or Pakistan, or Australia, or to one of many such overseas stations.
The Parent Board of Unilever itself and the Management of our 400 companies are
peopled by men like this. So, if you are a bird that likes a varied habitat, above all, if
you’re feathered for flight into the higher realms, Unilever’s atmosphere may be con-
genial to you.147
In 1962 the Netherlands had been the only European country to abstain from
voting in the General Assembly on the convocation of the first UNCTAD. In the
course of the negotiations which preceded the Geneva conference the Dutch gov-
ernment never ceased to push its European partners to assume a more open position
toward the developing world, following a line which seemed to renounce any de-
fense of the Community so long as the G77 did not put up for discussion the basis
of free trade or some form of automatic global income redistribution. The Nether-
lands aimed to play the role of mediator between the haves and the have nots.148
The Federal Republic of Germany took a tougher line, subordinating its aid policy
to both the financing of exports for its ever-efficient industrial base and the applica-
tion of the “Hallstein Doctrine,” which dictated the breaking of relations with any
nation which recognized the Communist German Democratic Republic to the East.
The application of the Hallstein Doctrine, which led the Federal Republic to cut off
diplomatic relations with Egypt and Tanzania, was subject to steadily harsher
criticism. But so long as the government was led by the Christian Democrats of
Konrad Adenauer, no German leader demonstrated the desire or the political strength
to alter its fundamental tenets. As Adenauer remarked, “I don’t feel conscious of any
moral guilt toward a colored person, I didn’t give him the color.”149 At the end of the
1960s, some 80 percent of German aid consisted of bilateral assistance.150
Italy lived through some of the contradictions characteristic of the North–South
divide. The consistently productive economy of its industrialized north, though
weighed down by serious social and educational inequalities, coexisted with a

147
E.P. Thompson, K. Alexander, S. Hall, R. Samuel, and P. Worsley, Out of Apathy (London:
Stevens, 1960), pp. 45–6.
148
J. Voorhoeve, Peace, Profits and Principles. A Study of Dutch Development Policy (The Hague:
Nijhoff, 1979).
149
W.G. Gray, Germany’s Cold War. The Global Campaign to Isolate East Germany, 1949–1969
(Chapel Hill: The University of North Carolina Press, 2003), p. 120.
150
S. Lorenzini, Due Germanie in Africa. La cooperazione allo sviluppo e la competizione per i mercati
di materie prime e tecnologia (Florence: Polistampa, 2003); H.L. Schmidt, “Spinti in prima linea:
La politica di cooperazione allo sviluppo della Repubblica federale tedesca (1958–1971),” in L. Tosi
and L. Tosone (eds), Gli aiuti allo sviluppo nelle relazioni internazionali del secondo dopoguerra
(Padua: Cedam, 2006), pp. 111–64.
82 After Empires

preindustrial southern mezzogiorno that received serial infusions of capital but

somehow failed to jump-start the virtuous cycle of growth. At the end of the 1950s
a segment of the Christian Democratic leadership had pushed for Italy to establish
new relationships with Latin America and the countries of the Mediterranean. This
“neo-Atlanticism,” which found one of its primary supporters in Prime Minister
Amintore Fanfani, represented an effort to play the role of bridge to the Third
World without giving up Italy’s transatlantic loyalties, indeed while continuing to
offer indispensable service to Washington.151 Rome also worked to promote the
birth of a politics of European cooperation that could help it fully exploit its lim-
ited financial resources. However, both its idea of wider political cooperation and
its Latin American initiative, though supported by Germany and Holland for the
opportunity to expand European regional ties beyond Africa, found stiff opposi-
tion from French interests. The Italian government committed itself instead—in a
decision not without risk for a country in its financial position—to participate in
the donor’s group within the OECD.152 Important sectors or large state-run indus-
tries, like Enrico Mattei’s ENI, had already established agreements that would an-
ticipate the demands subsequently put forward by the developing nations in the
coming years. ENI had built five or six refineries and twenty-three distribution
networks in Africa under particularly favorable conditions for the producer na-
tions (at least by contemporary standards). The refineries were of mixed ownership,
as were the distribution companies. ENI had also invested in technical coopera-
tion, for instance through the Scuola Superiore di Idrocarburi, created to develop
managerial talent from the producing nations. Mattei, however, died in 1962 in a
plane crash under mysterious circumstances, and his most ambitious plans, like a
project to open a university in Florence for students from the Third World—many
of which might have created frictions with the United States—were quickly
scuttled.153
One of the most important developments of the 1960s, the weight of which
would be felt well beyond Italian borders, was the Catholic Church’s changing
attitude toward the Third World. In order to compete with communist influence
throughout the decolonized world and within international organizations like the
UN, the Vatican was progressively forced to give meaningful support to the Third
World cause. In 1963, only a year after the Cuban Missile Crisis had shown the
risks of potential nuclear war, Pope John XXIII proclaimed in the encyclical Pacem
in Terris that war could no longer be considered an instrument of justice, since it
could now possibly result in the total destruction of mankind. His successor, Paul
VI, not only speeded up the process of adapting to the new society of mass
consumption in the industrialized countries but took another notable step for-
ward in the Church’s global positioning, increasing from 61 to 109 the number of
papal nunciatures and establishing apostolic delegations throughout the world. In

151
A. Brogi, L’Italia e l’egemonia Americana nel Mediterraneo (Florence: La Nuova Italia, 1996).
152
E. Calandri, “Italy’s’ Foreign Aid Policy 1959–1969,” in (2003) 12(4) Contemporary European
History, pp. 509–25.
153
M. Colitti, Energia e sviluppo in Italia: la vicenda di Enrico Mattei (Bari: De Donato, 1979); B.
Bagnato, Mattei in Morocco (Florence: Edizioni Polistampa, 2004).
 The Myopia of the European Community 83

the 1967 encyclical Populorum Progressio—which the Italian neo-Fascist Movi-

mento sociale italiano derisively called “Avanti populorum” (after the first lines of
the Communist anthem “Bandiera Rossa”)—the Pope put forth the idea that the
only way to work for peace consisted of incentivizing economic development of
the poorer nations. The Church also responded positively to initiatives on price
stabilization for commodities and the need to fight against racism.154 The encyclical,
the first to be entirely dedicated to economic issues, also referenced UNCTAD:
“With all our heart we encourage the organizations which have taken up this call for
collaboration for development, and wish that they be granted greater authority.”155
This interest in the themes of development and reform of international com-
merce was limited, however, to individual figures in Italian politics, and was cer-
tainly far from the collective consciousness of a people in thrall to an economic
boom and an unhindered rat race of new consumer pleasures, captured in Dino
Risi’s 1962 film Il Sorpasso. The Italian Mario Pedini, Christian Democratic repre-
sentative in the European Parliament, was charged with presenting the parliamen-
tary report on UNCTAD in Geneva as well as that of New Delhi in 1968. In both
cases Pedini’s report expressed disappointment that the European Community did
not have a common representation and that its member states held different posi-
tions on important issues. Pedini had been a Europeanist since his university days,
when he completed his thesis on Erasmus of Rotterdam, and in his district his
friends knew him as “the European” [Pedini l’Europeo]. The Italian Socialist Mario
Zagari, Under-Secretary in the Foreign Ministry, also threw himself into the dis-
cussions of both UNCTAD meetings, with the result that the Italian government
announced in 1965 the creation of an Inter-Ministerial Committee on UNCTAD,
making explicit reference to their experience with the question of the Italian mez-
zogiorno to demonstrate their credentials to address general issues of underdevelop-
ment.156 The following year Italy, in discussions with its European partners,
confirmed its support for a system of trade preferences, and above all a more active
role in the area of technical cooperation with the Third World, in particular

154
L. Tosi, “La cooperazione allo sviluppo della Pacem in Terris alla Populorum Progressio,” in
A. Giovagnoli (ed.), Pacem in Terris (Milan: Guerini e Associati, 2003), pp. 147–67.
155
FRUS, 1964–1968, vol. XXIV, n. 287, Memorandum from John Reilly of the Vice President’s
Staff to Vice President Humphrey, “Pope’s Encyclical The Development of Peoples,” April 14, 1967:
The encyclical provoked a stronger reaction both here and in Europe than most encyclicals do.
The reason is clear: [its] language is blunt and direct . . . Because it condemned the evils of unre-
strained capitalism and insisted that private property and profit must be subordinated to a higher
common good, it was criticized by the Wall Street Journal as “warmed-over Marxism” . . . The
status of the underdeveloped countries is regarded as similar to the proletariat in European na-
tions a century ago. The Pope makes it unequivocably clear that not only individuals have a
moral obligation but nations as well. Humanitarian aid is not enough, but rather “it is a ques-
tion, rather, of building a world for [where?] every man, no matter what his race, religion or na-
tionality, can live a fully given life . . .” But, if the prescriptions suggested in this encyclical are ever
to be followed, it will take a long-term massive shift in public opinion before any legislative body
will approve a program implementing what the encyclical proposes.
A “long-term massive shift in public opinion”: Prophetic words, in a sense, if one considers what
would take place the following year.
156
HAEU, BAC 2/1967, n. 24, Note, “Conseil UNCTAD,” April 26, 1965.
84 After Empires

through the furnishing and training of experts.157 In general, the government’s at-
tention seemed directed primarily toward areas for cooperation that would not
require extensive state spending. In November 1967, prompted by questions raised
by Italian Communist deputies in parliament regarding the fate of the Algiers
Charter, the government reiterated the position it had taken in New Delhi.158
Zagari declared a strategy for development: Tighter collaboration between eastern
and western Europe; adjustment of each country’s contribution in line with per
capita income; commitment to establish a program on several levels, including
diversification of production in the developing states, stabilization of commodities
markets, loans on favorable terms, and the application of a general system of trade
preferences; transmission of aid through multilateral channels (the World Bank
and US AID); regional integration of the developing states; and the widening of
debate on the technological gap beyond the US–Europe axis to include the less
industrialized areas of the world.
The reply of Renato Sandri in the name of the Italian Communists is interesting
because, while engaging a colleague well versed in Third World issues, he revealed
an understanding of a new dimension in the North–South conflict that would
emerge more clearly only after 1968. Sandri noted the insufficiency of the Italian
government’s efforts, for instance with respect to state aid, and added that the
government’s proposals appeared quite generic, because:
[w]e need to begin taking the bull by the horns: To admit, for example, that the devel-
opment of Latin America is impossible as long as 75 percent of the commodities it
produces are absorbed by the United States. So long as the United States of America
supports nefarious regimes, how can you put into practice what is merely a wish . . . We
believe that Italy has the potential—through its own experiences, through the prestige
it enjoys in the countries of the “Third World,” dare I say through the presence of great
forces upholding internationalist or ecumenical ideals—to approach the conference at
New Delhi as a testing ground for a national and European platform founded on
principles defending the independence of those nations.
Sandri’s comments reveal a readiness to debate with the majority the question of
cooperation, but also an attentiveness to issues of nationalization and the internal
social structures of the developing nations, issues with consequences (potentially,
politically explosive ones) still hidden beneath the surface of the international
debate on development.159 Until the end of the 1960s Italy would have one of the
worst records of all the donor states. Its occasionally quite advanced public procla-
mations were married to rather traditional mercantilist practices.160 A large part of

157
HAEU, BAC 2/1967, n. 8, Note, “Conclusions de la reunion du Groupe des Relations
Extérieures,” April 1, 1966.
158
Camera dei Deputati, IV Legislatura, “Discussioni,” sitting of November 15, 1967.
159
Up to the end of the 1960s the Italian Communists would be embarrassed by the contradictions
of their opposition to the Cuban idea of international revolution, the internal autoritarian evolution of
many Third World countries that seemed to question the role of a potentially “progressive” Non-Aligned
Movement, and the need to defend the international role of the Soviet Union in the transition to Social-
ism. M. Galeazzi, Il Pci e il Movimento dei non allineati, 1955–1975 (Milan: Franco Angeli, 2011).
160
E. Calandri, “L’Italia e l’assistenza allo sviluppo dal neoatlantismo alla Conferenza di Cancun
del 1981,” in F. Romero and A. Varsori (eds), Nazione, interdipendenza, integrazione. Le relazioni in-
ternazionali dell’Italia (1917–1989), vol. 1 (Rome: Carocci, 2005), pp. 253–71.
 The Myopia of the European Community 85

the Italian political class continued to see the United States as their primary refer-
ence point in foreign policy, despite some hostility toward specific initiatives and
in particular to the Vietnam War.161
The driving organizational force of the second UNCTAD was the Indian dele-
gation. The president of the UNCTAD Commission on Preferences was Indian (T.
Swaminathan), as was one of the most outspoken minsters of the G77 (K.B. Lall).
Indian authority and moderation were well received by Western diplomats, and
especially by Washington.162 In Lall’s view, the devaluation of the British pound
and America’s growing trade balance problems allowed the South to hold few illu-
sions about the possibilities of exploiting generous aid packages. The developing
countries would have to make strides with their exports if they were to achieve
notable increases in their standards of living.163 This might also explain why France,
which held a very dim view of preferences while calling for increased aid, was
among the favorite targets of the occasionally spiteful polemic barbs of Indian
diplomats. Aid, for the Indians, was nothing more than an expedient solution that
only scraped the surface of the poor nations’ deeper structural issues, and that
confined them to a lasting subaltern role.
Indian foreign policy hinged on the position of the Soviet Union. The USSR
was deeply hostile to China, which called upon it to man the ramparts against
imperialism according to the theory of “people’s war”: The revolutionary masses of
the South, who represented the “fields” of the world, were supposed to form a
“worker–peasant” alliance to wage an incessant war against the exploitation of the
capitalist world’s “cities.”164 Indira Gandhi, elected President in 1967, sought to
strengthen India’s position among the non-aligned states and accepted vast sums of
Soviet technical aid, without at the same time refusing American shipments, which
in 1965–6 brought daily containers of grain to Bombay.165 In 1967 the Indian
government was forced for the first time to alter its economic plan to reduce the
amount of state funds dedicated to industry and development.166 This was com-
pounded by a particularly dry farming season, making the market for industrial
goods in particular need of stimulus from exports. New Delhi’s need to obtain
tangible results from UNCTAD on the question of preferences was thus particularly
acute. Chester Bowles, the American Ambassador to India, reminded Washington
of the need to pay close attention to the subcontinent in order to avoid running
the risk of seeing it “drawn into the Soviet bloc within a few years.”167

161
A. Varsori, L’Italia nelle relazioni internazionali dal 1943 al 1992 (Bari: Laterza, 1998), p. 165.
162
NARA, CPF, FT3, Box 960, Embassy in New Delhi, “Consultations with GOI on UNCTAD
Matters,” January 12, 1965.
163
AMAEF, NOUI, Carton 1001, Ambassade de France en Inde, New Delhi, April 4, 1968.
164
The theory of the cities and the fields was officially announced by Lin Biao in an article in the
People’s Daily on September 3, 1965: “Let us examine the entire world: if North America and Western
Europe can be called the cities of the world, then Asia, Africa, and Latin America represent its rural
areas.” See P. Richer, Cina e Terzo Mondo (Milan: Mazzetta, 1972), p. 83.
165
Y. Malik and D. Vaspeyi, India: the Years of Indira Gandhi (New Delhi: E.J. Brill, 1988).
166
F. Frankel, India’s Political Economy, 1947–1977 (Princeton, NJ: Princeton University Press,
1978), p. 295.
167
WBGA, Records of Robert S. McNamara, General Correspondence, Chester Bowles, Letter to
Robert S. McNamara, April 30, 1968.
86 After Empires

The European Community had long debated the issues to be discussed at

UNCTAD II.168 They had agreed to accept preferences in principle, but there re-
mained substantial internal differences both over the right formula to put them
into practice and over eventual exceptions, as well as on the proposal to abolish
inverse preferences with the African states. Within OECD it had been agreed that
each industrialized nation should choose its own list of manufactured and unfin-
ished goods to which it would apply preferences. But within the Community there
was no such agreement. France sought to exclude from preferences both textiles
and refined agricultural produce, a particularly restrictive position. Holland, in
contrast, fought for the inclusion of refined agricultural goods and in the long term
to replace the Yaoundé association with a new global system of preferences with the
entire South. The majority of the delegates, however, agreed to avoid putting up
for discussion the renewal of the Yaoundé Convention, scheduled to expire in
1969. With regard to commodities, the idea of a general fund to stabilize prices—
an idea which would predominate in North–South negotiations during the mid-
1970s—was eliminated without discussion.
In the course of negotiations the French delegation, sensing the hostility toward
their most defensive positions, requested and obtained the right to change the
agreed position on questions on which they perceived they had greater room for
maneuver: The aid target of 1 percent of GDP, as well as the clause establishing a
fixed share reserved for state aid.169 The delicate nature of the French position
stemmed from the need not to risk rupturing their partnership with the African
states that, in fact, had stated in the Algiers Charter their support for a generalized
system of preferences, if only because they believed the Six (as well as the other
Western powers) would reject it.170 France could not have accepted any alteration
of the CAP, not even in exchange for a system of preferences for raw materials,
because this would have implied revising its special relationship with Africa.
Great Britain arrived at the New Delhi conference without serious expectations or
room for maneuver. British diplomats—less far-sighted than Heath—believed that
four years before at Geneva the risk of a Soviet-led revolt against GATT had already
been avoided, and that in the future North–South relations would be less tense.
UNCTAD II would not generate any grave new dangers, and at any rate London, as
we have already seen, did not possess the economic resources to play a vital role.171

168
AMAEF, NOUI, Carton 1000, Communauté Européennes, Le Conseil, “Preparation de la
deuxième session de la Conference des nations unies sur le commerce et la développement,” Brussels,
January 4, 1968.
169
AMAEF, NOUI, Carton 1001, Telegram, Burin des Roziers, January 3, 1968. The message
states that France is isolated among its European partners and that UNCTAD could be an opportu-
nity to make its voice heard on the international level.
170
AMAEF, NOI, Carton 1001, Ambassade de France en Inde, Maurice Viaud, New Delhi, March
14, 1968.
171
NA, FO 371/190067, Inter-departmental group on the United Nations Conference for Trade
and Development, “Preliminary Report on the Second UNCTAD Conference,” April 1, 1968; NA,
FO 371/190067, Draft paper “UNCTAD: Preparations for the Second Conference at the Board of
Trade,” November 8, 1967: “It was not possible to take a more advanced position as in 1964, the
important thing was to stay in line with the other western nations.”
 The Myopia of the European Community 87

Italy, whose delegation was led by Zagari, adopted a line similar to that of the
French, with two important differences. First, the developing countries were con-
sidered strategic markets for European Community exports; second, Italy attrib-
uted great importance to cooperation for the training of local technical experts and
the easy financing of production sites.172
The Germans, under the influence of their new socialist Foreign Minister Willy
Brandt, demonstrated a more progressive line than in the past, declaring their
willingness to increase by 60 percent their contribution to the IDA program of the
World Bank, to extend the system of preferences toward products not competing
with German goods, and to abolish internal tariffs on tropical goods. They re-
mained resolutely opposed, however, to more detailed price controls on raw mate-
rials. Bonn reminded France of the importance of the size of the Dutch
delegation—twenty-two members, including six parliamentary deputies, as well as
union and industry representatives—which showed the weight the Dutch placed
on their relations with the South.173
The EC, which could participate in UNCTAD only as an observer, found inter-
nal agreement on the need to defend and promote its role in the expansion of
global commerce. Speaking on behalf of the Six, the French Minister Michel Debré
noted that the Community’s exports had grown from US$15.911 billion in 1958
to US$29.112 billion in 1966,174 a growth rate of 84.8 percent; European imports,
meanwhile, had grown from US$16 billion to US$30 billion, an increase of 90.2
percent. Imports were thus growing faster than exports, and the Community
maintained a passive trade balance with third-party nations. What’s more, the
Community’s imports amounted to some 24.5 percent of the developing nations’
exports, representing their largest trading partner. It was thus impossible, he
argued, to call the Community short-sighted or selfish. Though not completely
uncritical, many of the AASM countries also came to the Community’s defense in
talks with the other countries of the South.175
The second UNCTAD conference thus took place in a political climate much
less hostile to the EC than the Geneva conference, at which both the memories
and the embers of the wars of decolonization had still burned brightly. The only
signs of tension flared up on the arrival of the South African delegation at the
hotels where they made their headquarters: Graffiti artists had altered the signs

172
AMAEF, NUOI, Carton 1001, “Consultations franco-italiens de la CNUCED,” November
1967–January 1968.
173
AMAEF, NUOI, Carton 1001, L’Ambassadeur de France prés la République Fédérale
d’Allemagne, “Avant la Conférence des nations unies pour le Commerce et la Développement, Bad
Godesberg,” January 18, 1968.
174
Michel Debré, on the occasion of the second session of UNCTAD, New Delhi, February 1968.
175
NA, BT 241/1902, Déclaration de Jazairy, représentant de l’Algérie à la cinquième Commis-
sion, March 4, 1968. According to the Algerian representative, criticism of the Community was vague
and imprecise because it should not have addressed preferential relationships but, first, the CAP, which
protected European agriculture even from its trade partners; and second, the unsatisfactory results of
negotiations with GATT, which had not helped Algeria, which saw its exports of manufactures to the
Community decline from some US$250 million in 1961 to US$160 million in 1966, while Yugosla-
via, Hong Kong, and India had seen their exports rise.
88 After Empires

warning “no dogs allowed” to add “no representatives of apartheid”; Indians in fact
constituted a significant ethnic minority in South Africa. The negotiations were
intense, and in the final weeks of discussion took place less in plenary assembly
than in the inner sanctum of Prebisch’s hotel, where he assembled the key delegates
under the name of the “Everest Group” to untangle the toughest knots holding up
the negotiations.176 At the last moment an accord was reached, but by the universal
judgment of the press as well as the delegates from the South, the agreements were
a disappointing and unsatisfactory compromise.
No definitive agreement could be reached on the international prices of sugar or
cocoa, which had been one of the primary objectives seemingly within reach. It was
established that the Western countries should plan to allocate 1 percent of GDP
for development aid, and all countries accepted in principle a general system of
preferences. But the devil is in the details, and none of the recommendations pro-
duced by the conference had binding effect. Furthermore, while the acceptance of
generalized preferences marked a minor revolution compared to the “liberalism” of
the “most favored nation” clause, no agreement had been reached on which prod-
ucts would be included under such a system, and no date had been fixed to put
such a system into effect. In substance, then, there was no guarantee that concrete
measures would be taken on any of the items presented by the South. On the con-
trary, the evolution of the international economy left the impression that certain
key countries were walling themselves off, and that total aid would diminish in the
future.
The perception of UNCTAD’s slowing momentum was so strong that even
Raúl Prebisch himself believed the scant progress achieved did not justify him re-
maining at the head of the organization, and he resigned as Secretary-General not
long after the conference’s conclusion. In an interview shortly thereafter, he even
acknowledged the wisdom of Che Guevara’s logic from the 1961 Latin American
meeting at Punta del Este, at which the revolutionary leader had presented to
Prebisch his treatise on guerrilla warfare with the dedication “a means for eco-
nomic development.”
In the European Parliament report on the results of the conference, Pedini ad-
mitted that:
the UNCTAD conference of New Delhi closed with a negative balance sheet. Even if
the failure predicted on the eve of its concluding session was avoided, the results are
mostly inferior to what had been hoped and appear ever more modest and
disappointing.177
One might say that one of the defining characteristics of the second encounter
between North and South had been a certain Western solidarity, which had al-

176
NARA, CPF, FT3, Box 959, Report of the US Delegation to the UNCTAD Conference, March
29, 1968. The Everest Group was composed of the Presidents of the three regional subgroups (Chile,
Ivory Coast, the Philippines), the President of the group of Socialist nations, and the leaders of the
French, English, German, and US delegations.
177
European Parliament, Speech of On. Pedini, “Risultati della seconda sessione della conferenza
delle Nazioni Unite sul commercio e lo sviluppo,” July 1, 1968.
 The Myopia of the European Community 89

lowed it to avoid engaging the questions of preferences and prices for raw materi-
als.178 At the same time, within the European Community the commitment to
defending the relationship with the African nations remained strong, at the ex-
pense of more advanced positions with respect to the general needs of the South.
The EC countries focused their efforts on national initiatives, hoping to guarantee
themselves vital living space and control over their own economies. The external
image of the Community remained that of the Kennedy Round and the liberaliza-
tion of trade between wealthy nations, and its internal logic that of an instrument
designed to ensure the advantages of the already prosperous economies of the in-
dustrialized world, without an independent policy toward the Third World other
than one of perpetuating colonial ties with selected group of countries of Franco-
phone Africa.

178
NARA, CPF, FT3, Box 959, Telegram for Greenwald from Solomon, “Target date for Prefer-
ences,” March 21, 1968: “Better to air dirty laundry in OECD than to repeat our differences in
public.” NARA, CPF, FT3, Box 958, US Mission to the European Communities, “European Com-
munity Image Polished at UNCTAD II,” February 9, 1968. While Debré asserted that from around
1960 the Community’s exports had grown less than its imports, on the other side the vast majority of
imports between 1960 and 1966 were composed of rising petroleum imports. The United States could
have used strong counterarguments to oppose Debré’s point, but chose not to do so. At the same time,
the Europeans avoided making any reference to Vietnam, which was also among the primary concerns
of the countries gathered in India.
 3
1968: Empires and Shopping Malls

On April 2, 1968, Gudrun Ensslin and Andreas Baader—future leaders of the ter-
rorist group better known as the Rote Armee Fraktion—placed incendiary devices
at two department stores in Frankfurt, the beating heart of German finance and
capital of the country’s liberal bourgeoisie, as well as an intellectual center for crit-
ics of the consumer society. It was late at night, and the two bombs produced ex-
tensive damage but no injuries. Only one day before Rudi Dutschke, the charismatic
leader of the German “New Left,” had been the victim of an attack by a right-wing
extremist goaded into action by the histrionics of the conservative press, led by the
Springer editorial group. Tensions in the country were slowly rising to a boil, par-
ticularly in Berlin, on the border between the two worlds of Soviet Communism
and democratic, capitalist Europe. One month after the attack on Dutschke the
French Mai ’68 would explode, transmitting the energy of European youth move-
ments across the globe, along with televised images of the chaos on the streets of
Paris, giving birth to the most important social and political protest movement in
western Europe since the end of the Second World War.1
Signs of discontent were everywhere in European societies during the 1960s,
but they had been too vague to be perceived clearly. The explosion was both sudden
and unforeseen. Captured shortly after the bombing, Ensslin released the follow-
ing statement:
The people in our country and in America and in every West European country, they
have to eat like animals, in order not to think about what we have to do for example
with Vietnam . . . Wonderful, I too like the cars, I too like all the things one can buy in
department stores. But when one is compelled to buy them, in order to remain uncon-
scious, then the price is too high.2
The year 1968 is still considered to represent a watershed event in European cul-
ture and customs. Eric Hobsbawm writes:
What has really transformed the western world is the cultural revolution of the 1960s.
The year 1968 may prove to be less of a turning-point in twentieth-century history

1
Daniel Cohn-Bendit has repeatedly stressed that 1968 was a “revolt” and not a “revolution,” in
which cultural concerns prevailed over political matters: see D. Cohn-Bendit, Forget 68 (Paris: Edi-
tions de l’Aube, 2008).
2
U.G. Poiger, “Imperialism and Consumption: Two Tropes in West German Radicalism,” in
A. Schildt and D. Siefried (eds), Between Marx and Coca-Cola. Youth Cultures in Changing European
Societies 1960–1980 (Oxford: Berghahn Books, 2006), p. 112.
 1968: Empires and Shopping Malls 91
than 1965, which has no political significance whatsoever, but was the year in which
the French clothing industry for the first time produced more women’s trousers than
skirts, and when numbers training for the Roman Catholic priesthood began visibly
to collapse.3
There is a growing literature portraying 1968 in western Europe as the embodi-
ment of, rather than a rebellion against, a new consumer society: While there may
have been credible protest movements calling for democracy and freedom of speech
in communist Europe, particularly in places like Poland and Czechoslovakia, the
other half of the continent witnessed little more than irresponsibile, hedonistic
revolts.4 Some scholars have sought to emphasize the ephemeral or meteoric qual-
ity of the French Mai, those two months of violent street demonstrations from
May 3 to June 30 that shone a spotlight on a generation, but ultimately failed to
leave any lasting trace on the institutions of the French Republic.5 Other historians
have attempted to broaden its temporal dimension, focusing on the participatory
spirit of 1968 as a feature characteristic of a wider range of cultural and working
class protests in the two decades from 1956 to 1976.6 In recent years even diplo-
matic historians have jumped on the bandwagon, depicting 1968 as a global phe-
nomenon—perhaps the first truly global political event—which had an impact
not only on social relations within individual states but also on the chessboard of
international relations itself. Jeremi Suri has described the global revolution as a
critical factor that reinforced the convergence of American and Soviet interests in
quelling such revolts, and that helped create and promote that season of diplo-
matic rapprochement that went by the name of détente.7
Whatever interpretive lens is used, the global 1968 marked a shift in western
Europe. What interests us here is not just that it was a protest against a model of
development based on the steady accumulation of wealth and focused on rampant
productivity growth, entirely indifferent to the effects of such growth on either the
environment or on those areas of the Global South left behind by the industrial-
ized world. Also crucially important is that these protest movements waged a cul-
tural and political battle against the discredited notions of European nationalism
and the entrenched logic of power underlying the Cold War.
Thanks in part to the rapid diffusion of information across truly global means of
communication, the symbols, slogans, and gestures most popular among Euro-
pean youth came from the rebels and heroes of independence movements in the
developing world, in particular those in Vietnam who took on the vastly superior

3
E. Hobsbawm, Interesting Times: A Twentieth Century Life (New York: Random House, 2002),
p. 261.
4
Judt, Postwar, pp. 407–12
5
J.F. Sirinelli, Mai 68. L’événement Janus (Paris: Fayard, 2008).
6
G.R. Horn, The Spirit of ’68. Rebellion in Western Europe and North America 1956–1976 (Oxford:
Oxford University Press, 2007).
7
J. Suri, Power and Protest: Global Revolution and the Rise of Détente (Cambridge, MA: Harvard
University Press, 2003). Immanuel Wallerstein has argued that the primary result of the global 1968
was to allow the Third World to free itself from the choice between Wilson and Lenin: see I. Waller-
stein, L’histoire continue (Paris: Editions de l’Aube, 1999).
92 After Empires

military and technological power of the United States.8 The stereotypical poster on
the walls of university dormitories throughout the West portrayed an enormous,
heavily equipped yanqui soldier held prisoner by a small and seemingly harmless
Vietnamese peasant. The image of Third World innocence was exploited by mili-
tants to instigate an uprising and evoke comparisons with inequalities within the
industrialized countries themselves. This “Thirdworldism,” far from being con-
fined to a few thousand young students or dedicated radicals, was to become for
more than a decade the lens through which the majority of Europeans—students,
labor and Catholic movements, and the bulk of militants of mass political parties,
each with their own distinct accent or perspective—understood the crisis of na-
tionalism, the emancipation of the Third World, and the waning influence of the
Cold War.

T H E L I M I T S O F A M E R I C A N I Z AT I O N

Throughout the 1960s the United States had maintained a strict hegemony over
western Europe. Its supremacy was based on a whole complex of factors, of which
its heavy military presence to defend the continent against a possible Soviet inva-
sion was only the most visible element.9 With the notable exception of de Gaulle’s
France, engaged in its quixotic pursuit of a politics of grandeur, other western
European states, led by the Federal Republic of Germany, had not backed away
from supporting the American war in Vietnam, continuing to purchase overvalued
dollars and pledging not to convert them into gold. Also, European labor relations
had partly been shaped by American financing and diplomatic pressures to favor
those trade unions that proved to be more amenable to the free market economy—
and more willing to contain the influence of communist labor organizations. The
costs of European energy requirements, meanwhile, were kept low by the influence
of Anglo-American petroleum companies, in exchange for the increasing subordi-
nation of western European policy in the Middle East.
To all this was added the weight of heavy investment from American banks and
multinational enterprises, which encouraged processes of product standardization
and the diffusion of consumption patterns similar to those prevalent in the United
States. While in 1956 the value of American private investment in western Europe
equaled US$4.14 billion, in 1970 the total value had reached US$24.52 billion.
American businesses that had watched their profit margins on standardized

8
This work rejects the notion that the European student movements and leftist intellectuals were
somehow the tools of international communism, or were duped by Soviet propaganda into singing its
praises, a thesis supported most prominently by scholars like Robert Service, who otherwise rightly
highlights these movements’ deliberate blindness toward the oppressive or otherwise illiberal elements
in many of the countries subscribing to Communism or “real socialism.” See: R. Service, Comrades!
A History of World Communism (Cambridge, MA: Harvard University Press, 2007), pp. 366–79.
9
Charles Maier has called American hegemony in western Europe an “empire of production,”
others “empire by invitation.” See C.S. Maier, Among Empires: American Ascendancy and its Predecessors
(Cambridge, MA: Harvard University Press, 2006).
 1968: Empires and Shopping Malls 93

products like soap or toothpaste shrink in North American markets, creating grow-
ing concerns about competition from European companies (with their lower labor
costs), began to take an interest in the great potential on offer from a growing
European market.10 By 1970, eleven of the fifteen largest French perfume brands—
those icons of Parisian style—had been acquired by American businesses.11
Economic collaboration inside what was not infrequently called the “Atlantic
Community” appeared to be producing an ever-closer union. This bond was consoli-
dated not only by significant levels of investment, but also increasingly through the
formation of transatlantic pressure groups, composed of an educated and “enlight-
ened” elite driven by hopes of promoting the progressive ideals of liberalism and in-
ternational cooperation. The Fulbright program, an initiative that involved American
and European university students, was a smashing success.12 The Bilderberg Group,
established in 1954 (and named after the site of its first meeting at the Hotel Bilder-
berg in Holland), had been set up by those, like the President of Unilever and the
Dutch Prince Bernhard, who were concerned about a potential rise in anti-Ameri-
canism and nationalistic retrenchment after the failure of the European Defence
Community.13 In a secretive and rather optimistic 1966 meeting—participants in
which included the Italian president of FIAT Giovanni Agnelli, the liberal French
philosopher Raymond Aron, and the Dutch socialist economist Jan Tinbergen, as
well as members of the Swedish Wallenberg dynasty, the President of the World Bank
George Woods, and the German Chancellor Ludwig Erhard, alongside his Socialist
opponent Helmut Schmidt—members stressed the need for coordinated action by
the Atlantic countries towards the Third World. Such unity would be even more
urgent in light of the crisis of Soviet Communism following its split with China, and
the consequent opportunity to promote an international expansion of the market
economy. Great things were expected of European social democrats who, it was be-
lieved, would be more receptive than the conservative Catholic and Christian parties
to progressive Bilderberg ideas.14 The Ford Foundation also engaged in efforts to
promote liberalism among primarily intellectual circles. The Foundation sponsored
and financed the publications and meetings of “end of ideology and class conflict”
theorists, and advocated broadening access to consumer goods in order to defend
democracy. Galbraith capably summarized the content of this progressive liberal
vision: “Consumer wants can have bizarre, frivolous, or even immoral origins, and an
admirable case can still be made for a society that seeks to satisfy them. But the case
cannot stand if it is the process of satisfying wants that creates the wants.”15 William
McNeill’s The Rise of the West, first published in 1963, can be considered the intel-

10
P.S. Jha, The Twilight of the Nation State: Globalization, Chaos, and War (Ann Arbor, MI: Pluto
Press, 2006), p. 90.
11
De Grazia, Irresistible Empire, p. 369.
12
R. Pells, Not Like Us. How Europeans Have Loved, Hated and Transformed American Culture since
World War II (New York: Basic Books, 1997), pp. 205–63.
13
H. Wilford, “CIA Plot, Socialist Conspiracy or New World Order?,” in (2003) 3 Diplomacy and
Statecraft, pp. 70–82.
14
WBGA, Records of the President George Woods, Travel Files, Box 1, “Bilderberg Meetings,”
March 1966.
15
J.K. Galbraith, The Affluent Society (London: Hamish Hamilton, 1958), p. 120.
94 After Empires

lectual background for this idea of a common Western civilization, the gravity of
which may have shifted during the twentieth century from one shore of the Atlantic
to the other, but which retained its unmatched ability to influence and interact with
other global civilizations.16 Pressures from American cultural foundations for the
creation of classes in the history of Western civilization within European universities,
however, never found complete acceptance in European academic curricula in the
1960s, and were rejected shortly thereafter.
Such was the faith of Washington policymakers in the successful Americaniza-
tion of the European political and economic elite and in the replacement of their
old conservative, religious, or colonial convictions, that in 1961 the Foreign Lead-
ers Program began to redistribute its funds toward the Third World, considering its
task in western Europe to be complete: By this point (1964), “[there was] a grow-
ing recognition that for a European to be considered fully and properly educated
he should have gained substantial knowledge about the United States through
either travel or study or both.”17
In a study financed by the Ford Foundation and published in 1968, the Ameri-
can economist Richard Cooper—who would become one of the principal archi-
tects of international economic policy under President Jimmy Carter—observed
that, while there might be certain differences in foreign policy concerning relations
with eastern Europe, the Atlantic economies were largely interdependent and their
economic policies inextricably linked. The only item left to resolve was the ques-
tion of the dollar, on which an agreement could be reached in select, high-level
circles and without the unnecessary involvement of the developing countries. To
support this contention Cooper noted that in 1966 some 128 million visitors had
traveled across the Atlantic, that there were an estimated 1 million Americans in
Europe—its military presence included—as well as more than a million Greeks,
Italians, Turks, and Spanish in the Federal Republic of Germany, and that more
than 1 million Canadians currently worked or studied in the United States. Ameri-
can businesses were opening some 500 new branches in Europe every year. Goods
flowed between countries without major problems, and via satellite one could even
watch or listen to the President’s speeches live from the White House.18
On the other hand, if the weight of the American economy was playing an in-
creasingly preponderant role in western Europe, the ostentatious protests of Gen-
eral de Gaulle were not the only voice contesting American ideological and political
predominance over the continent. While the structure of political parties, interplay
of social actors, and role of the state in the economy were never truly identical on
both sides of the Atlantic,19 minorities on the fringes of their intellectual and

16
William H. McNeill, The Rise of the West: A History of the Human Community (Chicago: Univer-
sity of Chicago Press, 1963).
17
G. Scott-Smith, Networks of Empire. The US State Department’s Foreign Leader Program in the
Netherlands, France and Britain (Brussels: Peter Lang, 2008), p. 43.
18
R.N. Cooper, The Economics of Interdependence: Economic Policy in the Atlantic Community (New
York: Council on Foreign Relations/McGraw Hill, 1968).
19
M. Nolan, The Transatlantic Century. Europe and Amercia, 1890–2010. Cambridge: Cambridge
University Press, 2012.
 1968: Empires and Shopping Malls 95

political worlds had begun to develop strong critiques of the capitalist economy
even outside the orthodoxy of west European communist parties. Their thinking
was deeply engaged with Marxism, but they had elaborated new formulas that
could take into account the recent history of capitalism—often described as
“neocapitalism”—the authoritarian machinery of the consumer society, and the
emergence of the Third World. A prime example was furnished by Sartre’s unor-
thodox reflections in his preface to The Wretched of the Earth, which helped make
Fanon’s book the bible of “neocolonial” discourse. While the French Communist
Party avoided declaring outright opposition to the Algerian War, believing French
workers unresponsive to antinationalist propaganda, writers like Albert Camus—
soon to become obligatory reading for every European teenager—condemned the
hypocrisy of Western travelers when confronted by the poverty of the underdevel-
oped world. After a visit to a favela in Rio de Janiero he wrote: “In reality, [I am]
haunted in the glorious light of Rio by the idea of the harm we do to others from
the moment we look at them.”20 Such perspectives called into question Europeans’
consciousness of what it meant to be Western, and the sense of superiority that
went along with it. In Great Britain, intellectuals like E.P. Thompson evoked a
vision, as improbable as it was provocative, of England at the vanguard of interna-
tional neutrality, yearning hopefully for a time when its people “would have to
learn Gujarati and Chinese, as well as French and German, and to read classic
Chinese literature as well as Dostoyevsky.” Similarly, Thompson and his colleagues
underscored how the hyperproductive system of global capitalism, be it managed
by the state or the private sector, was only apparently invulnerable:
Colliery engine-winders can halt the pits: bus or tube drivers can disorganize the me-
tropolis: a few score electricians can cut off power supplies to a whole industrial
region . . .
So that the apparent immobility of “the Establishment” conceals points of extreme
sensitivity; and, equally, the bureaucratization of public life (most noticeable in the
Labour Movement) is as much a product of apathy as a cause.21
In northern Italy, with its deeply entrenched manufacturing culture, the intellectu-
als and activists who gathered in Turin around the journal Quaderni Rossi exam-
ined how the industrial economy, including even those concerns run by the state,
crushed labor in both body and spirit. They focused on the need to humanize fac-
tory conditions by raising workers’ consciousness, participation, and agency. A
similar sense of oppression, couched in an artistic sensibility more given to broader
reflections on the general crisis of civilization, permeated the thought and writings
of the Italian poet and filmmaker Pier Paolo Pasolini. In his famous article on the
“disappearance of the fireflies,” Pasolini described a society in the vise-like grip of

20
A. Camus, American Journals, trans. Hugh Levick (New York: Paragon, 1987), p. 114.
21
Thompson et al., Out of Apathy, p. 7. On the effects on of the “revolt against the West” on British
international relations theory see I. Hall, “The Revolt against the West,” (2011) 33(1) International
History Review.
96 After Empires

a consumerist “neofascism” that systematically destroyed established values in order

to replace them with the anonymous technological power of modernity. He had
been struck by the religious symbolism of an ad campaign for a brand of jeans—
“you shall have no other jeans before me”—as an example of how even the most
revered Catholic cultural values were now up for sale in the name of commercial
success. He placed the advent of this change around the middle of the 1960s when,
as a result of either urbanization, environmental pollution, or both, the fireflies
had disappeared from the Italian countryside. His conclusion: “I, as multinational
as I may be, would give the whole of Montedison for one firefly” (“Io, ancorché
multinazionale, darei l’intera Montedison per una lucciola”).22
But it was probably in Germany that the critique of the modern capitalist soci-
ety reached its most thorough and sophisticated level, as well as its greatest poten-
tial for international export. From the pockets of the heavy parkas that had become
the uniform of the most fashionable university students, paperback books began to
sprout bearing the seemingly ubiquitous name of Herbert Marcuse. In The One-
Dimensional Man, first published in the United States in 1964, Marcuse con-
demned the era of the citizen consumer weighed down by the extraordinary
commercial choices at his disposal, yet deprived of the ability to decide truly im-
portant social or political issues. In response, Marcuse called for a “great refusal” of
such a technocratic society, with a sympathetic eye toward the events taking place
beyond Western horizons. The Italian sociologist Luciano Gallino, who taught in
the United States at Stanford University before returning to the University of
Turin, recalled how in the years leading up to 1968 “there was not a single student
who had not read the book, or who hadn’t in some way come into contact with its
ideas through conversations with their companions”; an observation supporting
Marcuse’s point that the most dangerous aspect of industrial societies was precisely
that they give the illusion of living in complete freedom.23
In 1964 the Venice Biennale awarded its Grand Prix to an American artist,
Robert Rauschenberg, rewarding his informal Pop Art over the more traditional
entries of his European colleagues. At the same time, in quite a different way,
American toilet paper and toothpaste had become household items from Amster-
dam to Palermo. But none of this was sufficient to produce a definitive homogeni-
zation of European and American societies: Consumer goods, models of
industrialization, films and cultural events were still perceived and adapted through
eminently national lenses. As Samuel Huntington has aptly summarized in his
best-known work, the spread of consumption patterns is not enough to change
value systems or political structures: “The essence of Western civilization is the
Magna Carta, not the Magna Mac. The fact that non-Westerners may bite into the
latter has no implications for their accepting the former.”24

22
P.P. Pasolini, Scritti Corsari (Milan: Garzanti, 2006), pp. 128–34. Until the 1970s Montedison
was one of the world’s largest chemical industries.
23
L. Gallino, “Introduzione,” in H. Marcuse, L’uomo a una dimensione (Turin: Einaudi, 1999),
p. IX.
24
Huntington, The Clash of Civilizations, p. 58.
 1968: Empires and Shopping Malls 97

Perhaps rather than talk of “Americanization,” the phenomenon that most pro-
foundly influenced European and American societies in the course of the 1960s
was the emergence of a powerful combination of shrinking distances, increasing
ease of communication, and spreading consumer goods and popular culture. In
short, everything that, after the decline of the coordinated resistance of the Third
World and, above all, after the end of the experiment with “real Socialism” in the
Soviet Union, has become commonly defined as “globalization.”
The Sixties were the decade of television and of the introduction of satellite
transmission. The first transatlantic telephone cable had been laid as late as 1956.
In 1954 the Eurovision network was launched; though it did not air coordinated
international programming until 1968, it represented an initial effort to place Eu-
ropean citizens in direct contact with one another. In the wealthier nations, in-
creasing vacation time and disposable income inaugurated the era of mass tourism:
While in 1950 there were roughly 25 million international travelers, in the follow-
ing decades their numbers rapidly expanded, reaching some 400 million by the
mid-1980s.25 Tourism was a thriving industry that offered several opportunities for
standardized services. European entrepreneurs quickly understood its potential,
creating the Club Med chain of resorts, for example, whose golden age spanned the
period from the late 1950s until the mid-1970s.
And what an explosion of innovation both spurred and sped up the circulation
of goods and capital! On April 26, 1956, the Ideal-X became the first ship to
unload a container at the port of Newark, in New Jersey; the first crane built spe-
cifically to move such containers entered into service in 1959 at the port of Oak-
land in Alameda, California. These ship-to-shore cranes were capable of performing
the work of longshoremen at some forty times the speed, and standardized con-
tainers, with their uniform box dimensions, could be loaded and unloaded onto
trucks, trains, and ships. In combination, they were responsible for establishing
thriving new port cities, creating widespread unemployment among longshore-
men in the old maritime centers, forcing many small manufacturing industries to
go global and others to disappear entirely. “The Box” was the propulsive agent of a
new phase of industrial production, as well as a key component of the complicated
logistical planning behind the US military intervention in Vietnam. With contain-
erization, which expanded massively after 1965 with the construction of the first
specialized container ships,26 industries were able to place parts of their production
chain far from their manufacturing headquarters with much greater ease. The year
1962, meanwhile, marked the opening of the first Wal-Mart store: The introduc-
tion of a chain that would revolutionize large-scale distribution systems through its
obsessive drive to obliterate competition from smaller business by lowering its
prices. Although the tendency toward the megastore would find stiff resistance in

25
C. Ponting, A Green History of the World: The Environment and the Collapse of Great Civilizations
(New York: Penguin, 1991), p. 322.
26
M. Levinson, The Box: How the Shipping Container Made the World Smaller and the World Econ-
omy Bigger (Princeton, NJ: Princeton University Press, 2006).
98 After Empires

Europe, where the tradition of local markets and specialty retailers was more deeply
rooted, consumers throughout the West enjoyed new spending opportunities
during this period through the creation of plastic money: The credit card, that
now-ubiquitous multiplier of consumers’ spending power.
While in 1950 multinational businesses comprised only 17 percent of the sales
of manufactured goods, in 1967 they had managed to achieve 42 percent, and in
1974 they represented 62 percent of total trade in manufactures. In 1950, annual
sales by multinationals in the free market countries represented 8 percent of world
production, by 1967 they had reached 17 percent. Various factors promoted the
growth of multinationals: Among them the reduction in transportation costs,
which allowed such corporations to shift production wherever labor costs were
lowest, and the desire to produce directly in those countries, such as Brazil or
Mexico, where manufactures were protected by import tariffs. While in the 1950s
multinationals were mostly created in the United States, in the 1960s they began
to emerge in western Europe: In West Germany they grew from 61 to 560 between
1950 and 1970, in France from 69 to 524 during the same period.27
At the end of the 1960s the world seemed destined to become ever smaller.
Improved means of transportation had made it easier to move both goods and
people. New technologies like the satellite began to connect the globe, leading the
most visionary analysts to forecast a radical redefinition of man’s very concepts of
time and space.28 For the first time, technology offered the opportunity to watch
the world unfold, moment by moment, on a global scale. “The Whole Earth,”
photo number 22,272 from Apollo 17, showed the planet in microscopic detail—
united by nature, rather than divided by political borders.29

T H I R DWO R L D I S M A N D S O C I A L R E B E L L I O N

Thirdworldism was a political and cultural trend that struck western Europe with
particular intensity in part because of the stark contrast it presented with the domi-
nant culture of the colonial and postcolonial era. Only from the end of 1960s, and
very slowly, did it become possible to question nationalism and colonialism in the
movies and on television, as well as in school textbooks.
Spread primarily by the raucous social activism of the movements associated
with 1968, thirdworldism soon became a widespread sensibility among European
citizens and political leaders, before slowly fading and transforming itself by the
early 1980s. Its popularity was also due in part to the activities of new publishers,
such as François Maspero in France and Giangiacomo Feltrinelli in Italy; the latter
visited Cuba on more than one occasion to meet Castro and learn guerrilla ideol-
ogy firsthand, and printed hundreds of thousands of copies of Che Guevara’s

27
R. Vernon, Storm over the Multinationals. The Real Issues (New York: Macmillan, 1977).
28
M. McLuhan and Q. Fiore, The Medium is the Message (New York: Bantam, 1967).
29
A. Mattelart, Histoire de l’utopie planétaire: De la cité prophétique à la société globale (Paris: La
Découverte, 2000), pp. 313–14.
 1968: Empires and Shopping Malls 99

diaries before dying in 1972 in a dubious attempt to sabotage Italy’s electricity

grid.30 In this sense thirdworldism was a response to the cardinal events of Euro-
pean history in the second half of the twentieth century: The loss of Europe’s
centrality and primacy in international affairs, and its diminishing cultural weight;
the search for some small margin of autonomy to counter the increasing belliger-
ence with which the United States pursued its political and economic goals; and
the first signs of social and environmental vulnerability in the Western model of
development, with the consequent efforts to devise alternative solutions not neces-
sarily based on the Soviet model.
Yet it was opposition to the Vietnam War that acted as a catalyst to activate the
latent energies of the student movements in the United States, well before their
European counterparts. This process was aided by the new means of communica-
tion that made the conflict in Southeast Asia the first war to be televised live.
American students began to understand that it was impossible to avoid engaging
with the consequences of a war that, while fought in a far-off, foreign land, consti-
tuted the dark side of their own more privileged lives. College students in Califor-
nia went about chanting “Western Civilization has got to go.” This core curriculum
course no longer corresponded to what thay wanted to learn. Many indeed sought
refuge from what they saw as a world full of such violence, in socioeconomic rela-
tions no less than in diplomatic and military affairs, taking flight on voyages of
self-discovery through the use of newly synthesized drugs and winding up in self-
isolating communities like those of the “hippies.” The desire to engage the world
proved even stronger, however, embodied by the urge to “get involved.” One exam-
ple of such generational restlessness was recorded in an epistolary exchange be-
tween the celebrated diplomat and professor George Kennan and a number of
American university students.31 Published in The New York Times Magazine on
January 21, 1968 under the title “Rebels Without a Program,” Kennan’s article—
he was at that time a professor at Princeton and the most famous contemporary
American diplomat for his analyses of the Soviet Union—suggested that university
students involved in the antiwar protest movement should instead focus on their
own studies and emulate the “monastic character of the medieval university”:
[I]t is the ideal of the association of the process of learning with a certain remoteness
from the contemporary scene—a certain detachment and seclusion, a certain volun-
tary withdrawal and renunciation of participation of contemporary life in the interests
of the achievement of a better perspective on that life when the period of withdrawal
is over.
. . . The fact of the matter is that the state of being enragé is simply incompatible
with fruitful study. It implies a degree of existing emotional and intellectual commit-
ment which leaves little room for open-minded curiosity.32

30
J. Hege, “Editori di sinistra e lotta armata in Italia (1966–1979),” in M. Lazar and M.A. Matard-
Bonucci (eds), Il libro degli anni di piombo. Storia e memoria del terrorismo (Milan: Rizzoli, 2010).
31
G. Kennan, Democracy and the Student Left (Boston: Little, Brown and Co., 1968).
32
Ibid., pp. 3, 7.
100 After Empires

His suggestion provoked intense debate and he unexpectedly received numerous

replies from young students, the majority of which, while demonstrating respect
for Kennan’s stature, nevertheless radically disagreed with Kennan’s concept of the
monastic ideal. One freshman from Harvard wrote:
We are unique in the history of this country . . . At graduation we face the certainty of
some kind of death, moral if not physical, and we must hence do all our living, endure
all our agony and ecstasy in four short years. We dwell with the horrible feeling of
being a pawn caught in someone else’s chess game. Is it any wonder that we are disen-
chanted with the society that could give rise to this situation?33
Another student was even more blunt, arguing that it was impossible to avoid
contemplating the ills of the contemporary world “with universities becoming in-
creasingly service stations for military and corporate interests.”34
The high-water mark of public protest in the United States probably occurred in
1967. In July of that year the Rust Belt city of Detroit—capital of the American
automobile industry—exploded in fiery race riots in which forty-three people were
killed. In October, 100,000 antiwar demonstrators marched on the Pentagon out-
side Washington, DC, shouting “Johnson withdraw from Vietnam, like your father
should have from your mom.” The protests quickly degenerated into disorder and
arrests. After such violent episodes, the student and antiwar movements, like that
for African-American civil rights, continued to fight forcefully and would indeed
find a prominent role in American culture in the 1970s, but in progressively deeper
political isolation.
The situation in Europe was different. 1968 was “only the beginning” of a proc-
ess of wide radicalization in European society and politics. It could possibly be
argued that the 1970s were for western Europe what the 1960s were for the United
States.
Jacques Chaban-Delmas, who would be named French Prime Minister after the
fall of de Gaulle, evoked the atmosphere on the eve of the French Mai:
How peaceful it was here! The United States could not stop licking the moral wounds
that the Vietnam War was inflicting on its youth, and its race problem was explosive.
Great Britain, in a depression, was struggling to survive on the ruins of its past glories.
Belgium was divided in two and was enduring the worst period of its history.35
And yet nothing seemed to be happening in France, in comparison with other
European nations and the United States. An editorial of March 15 in Le Monde
stated: “That which characterizes French society today is boredom.”36 Michel
Jobert, who would become Foreign Minister under new President Georges Pompi-
dou, recalled the same impression: “Under the General we were all content . . . Few

33
Ibid., p. 28.
34
Ibid., p. 42.
35
J. Chaban-Delmas, Mémoires pour demain (Paris: Flammarion, 1997), p. 394.
36
P. Viansson-Ponté, “Editorial,” in Le Monde, March 15, 1968.
 1968: Empires and Shopping Malls 101

people had expected anything. But what was there to expect? That we would in all
probability move from the nineteenth century into the twentieth?”37
In the second half of March a group of student radicals set fire to the local offices
of American Express. A few days later students had occupied the Université Paris
X at Nanterre. On May 3, 1968 students from the Sorbonne in Paris gathered in
the main quad to protest against the closure of the university at Nanterre, but also
to express their disgust at a fire which torched a local student association building:
A fire set by an extreme right-wing group called, by force of circumstance, Occi-
dent.38 The incident provoked violent demonstrations, which made front page
news in press and television reports and is often considered the spark which ignited
Mai ’68. Even though the French Mai exploded well after 1966, when Flemish
students at Louvain in Belgium had protested violently against Francophone cul-
tural colonialism,39 and months after Italian students had occupied their own uni-
versities, it was in Paris that the student movement created a paroxysm of such
violence as to raise legitimate fears of a revolution, ultimately contributing to de
Gaulle’s final exit from the national stage.
Streets, universities, and public spaces were being occupied by a new generation
that had not witnessed the horrors of the Second World War, but that found itself
facing unprecedented challenges from a competitive society that appeared stuck in
the outdated moral and social codes of the era preceding the world conflict. The
Poignant Report of 1959 had underlined how Europe was lagging behind both the
United States and the Soviet Union in terms of equal access to higher education, and
even Jean Monnet himself had understood clearly how the student movement was
driven by a sense of indignant frustration with a blocked society and against a nation
state apparently incapable of offering fresh solutions.40 But their protests were not
born simply out of the need for reforms to improve access to a world of high salaries.
European students expanded in number throughout the 1960s, so that they repre-
sented a consistently visible and vocal segment of the youth population. The majority
of them also believed that the course of decolonization had not yet been completed,
not while there existed, in the Third World as well as within the developed nations
themselves, social hierarchies, racism, authoritarian power structures, and exploita-
tion of workers—all elements that they held to be antithetical to authentic participa-
tory democracy.41 As the Italian academic Peppino Ortoleva observed:
It is not possible to comprehend fully the sympathy of the [student] movement for the
Third World, including all the mythologizing which it produced, without seeing it as
the product of a single need: The urgent desire for a moral clarity that one could iden-
tify oneself with completely.42

37
M. Jobert, Ni dieu, ni diable: Conversations avec Jean-Louis Remilleux (Paris: Albin Michel, 1993),
p. 119.
38
M. Teodori, Le nuove sinistre in Europa: 1956–1976 (Bologna: Il Mulino, 1976), p. 365.
39
Horn, The Spirit of ’68, p. 69.
40
Monnet, Mémoires, pp. 489–90.
41
At Paris X at Nanterre, where the French student movement had been born, the enrolled student
body grew from 2,000 in 1963–4 to 15,000 in 1967–8.
42
P. Ortoleva, I movimenti del ’68 in Europa e in America (Rome: Editori Riuniti, 1998), p. 53.
102 After Empires

The Vietnam War, which was understood not as the latest manifestation of a tradi-
tional war for political and territorial domination, but as the noble struggle of
peasants against an economic and military superpower, thus assumed the symbolic
weight of a conflict by the weak and exploited against the tyranny of the captains
of industry in Western societies.43
In Germany, this antiauthoritarian struggle and mobilization against the war in
Vietnam went hand in hand. In a 1966 resolution, the Sozialistischer Deutscher
Studentenbund (SDS),44 the most prestigious German youth organization, defined
the war in Vietnam as:
1. a war of national and social liberation;
2. a potential model for other conflicts in semi-colonial agricultural areas of Asia,
Africa, and Latin America;
3. a threat to the vital interests of the citizens of the United States and its allies;
4. the potential spark for a much wider conflict.45
Rudi Dutschke, the charismatic leader of the SDS, would later say that the continual
mobilization against the American intervention in Vietnam throughout 1965–6 had
fostered in German students an antiauthoritarian bent that would be subsequently
reinforced in their dealings with the university bureaucracy.46 It is worth citing two
extended passages of a letter from Hans Magnus Enzensberger to the president of
Wesleyan University, with which the then-famous German writer and journalist an-
nounced his resignation from his American academic post and intention to teach
instead in Latin America. Enzensberger’s comments fully capture the complexity of
the European left’s disillusionment with the United States, rendered more difficult by
its refusal to countenance alternatives from discredited European nationalisms:
The fact is that most Americans have no idea of what they and their country look like
to the outside world. I have seen the glance that follows them: tourists in the streets of
Mexico, soldiers on leave in Far Eastern cities, businessmen in Italy or Sweden. The
same glance is cast on your embassies, your destroyers, your billboards all over the
world. It is a terrible look, because it makes no distinctions and no allowances. I will
tell you why I recognize this look. It is because I am a German. It is because I have felt
it on myself . . .

43
The Italian Communist Rossana Rossanda wrote: “Just as for us our political birth and adoles-
cence were the Spanish Civil War, against Fascism, for the youth of today who occupy the universities
they are the Vietnam War, against imperialism.” See R. Rossanda, L’anno degli studenti (Bari: De
Donato, 1968), p. 40.
44
The SDS was the student organization of the German Social-Democratic Party, but it was ex-
pelled from the party after the Bad Godesberg congress for its excessively radical positions.
45
Teodori, Le nuove sinistre in Europa, p. 173.
46
U. Bergmann (ed.), La ribellione degli studenti (Milan: Feltrinelli, 1968), p. 199; L. Cortese,
Il Movimento studentesco, Storia e documenti 1968–1973 (Milan: Bompiani, 1973), p. 180:
The objectives of the student movement and the struggles of the Third World were identified
with one another, leading to the conclusion that the enemy was one and the same, even if its faces
looked different. As a consequence, according to Dutschke, the war itself must also be the same.
“It is evident,” he argued, “that without a profound change in the international system, especially
the struggles of the forces of national liberation in the Third World, it will be extremely difficult
for us to create, on our own, a revolutionary situation.”
 1968: Empires and Shopping Malls 103
But surely Mr Johnson is overstating his case when he implies that the American
people are but a single, solid corporate giant fighting for its loot. There is more to
admire in America than meets Mr Johnson’s eye. I find little in Europe that could
compare with the fight put up by people in SNCC, SDS, and in Resist. And I may
add that I resent the air of moral superiority which many Europeans nowadays affect
with respect to the United States. They seem to regard it as a personal merit that their
own empires have been shattered. This, of course, is hypocritical nonsense.47
In Italy, students in both Marxist and Catholic circles pushed for greater attention
to be paid to the human and social dimensions of the country’s miracolo economico,
while also fighting against capitalist imperialism in the Third World. From univer-
sity halls their protests spread rapidly, and unexpectedly, to the workplace.48 In
Genoa longshoremen welcomed an American container ship with the banner:
“Genova rossa (‘Red Genoa’) welcomes your ships with the same rage with which
the Vietnamese welcome your soldiers.”49 The Italian student movement was poly-
centric, unlike its French and German counterparts, with multiple hotspots from
Turin in the north to Cosenza in the south, each with particular concerns which
prevented any one individual figure from being invested with the power to act as
its spokesman. The manifesto of the student protesters in the small Abruzzese town
of Chieti, for example, demonstrates how the polemic tone of the movement
reached far outside the country’s major urban centers:
The reasoning behind the deaths of those Mexican students killed, wounded, or ar-
rested is the same reasoning behind those 400,000 Vietnamese exterminated by
napalm. It is the reasoning behind the deaths of Che Guevara and of Camilo Torres,
and the reasoning behind the widespread hunger, illness, misery, and destitution
throughout Asia, Africa and the Middle East. The blood of those Mexican students is
the same as that of the Chilean miners, of the Bolivian indios, of the Vietcong. It is the
same as the blood of the French, American and Italian students scientifically elimi-
nated in the hopes of silencing their demands for liberty, equality, democracy, the
blood of the workers that are crushed beneath the weight of the machine in their
factories, or of the workers in the fields forgotten by technological development.50
Much further to the north, Scandinavian youth were among the most passionately
interested in the problems of the developing world. Swedish politics was founded
on a consensual model that required every important decision to be filtered through
a long process of popular consultation and participation. Education reform had

47
H.M. Enzensberger, “On Leaving America,” in (1968) 10(4) The New York Review of Books,
February 20, 1968.
48
The first issue of the journal Terzo Mondo came out in Italy in 1968; among its collaborators were
a number of exponents of the Catholic left. Its first editorial comment stated:
In the last few years, even in Italy, enormous interest has grown in the problems of the Third World:
From economic and social issues to political struggles, from traditional cultures to radical proposals
for social and cultural renewal . . . in short, the Third World as engagement, and not as escape.
49
S. Tarrow, Democracy and Disorder. Protest and Politics in Italy, 1965–1975 (Oxford: Clarendon
Press, 1989), p. 75.
50
S. Paoli, “La geografia mentale del Sessantotto italiano 1967–1969,” in (2007) 22 Annali della
Fondazione Ugo La Malfa 73, pp. 85–6.
104 After Empires

already been accomplished, following this pattern, by the social democratic gov-
ernment.51 The eruption of violent student protests against the administration of
Olof Palme thus appeared all the more surprising, as did the creation of a wide-
spread pro-Vietcong movement, which by 1972 had attracted roughly 10,000
members.52 Even so, the less conflictual nature of Swedish society perhaps allowed
its students to approach the problems of the Third World from a more pragmatic,
rather than ideological, perspective. The United Nations Information Center for
western Europe, based in Copenhagen, referred to one of the many “thirdworldist”
initiatives of Swedish youth in the following manner:
An initiative of a different type with respect to the recent demonstrations of student
unrest took place over the weekend in Stockholm, where 30 students, who had traveled
from the university town of Lund, staged a sit-in and hunger strike in front of Parlia-
ment the day before discussions on the proposed budget, to protest against the meas-
ures regarding development aid, which they considered inadequate and wished to
suspend. The peaceful demonstration was promoted by a group of 250 Lund students
known as the U Group (Group for the Developing Countries), which also took the
initiative to begin a public discussion on the question of aid with the goal of “raising
ministers’ consciousness.”53
Notwithstanding Labour’s many concessions on the plane of civil liberties during
the 1960s, British universities were not immune to protests by student organiza-
tions opposed to their government’s foreign policy. The 1967 May Day Manifesto,
the fundamental theoretical contribution of the British New Left, stated:
So far as Britain is concerned, we can only speculate that the full liquidation of Empire
never in fact took place. In economic terms, it is clear that where colonial governors
took off, the new international companies and financial interests took over . . .
Of course, the help must be given. But just as the Labour movement developed as
a better alternative than charity for ending poverty and inequality, so, in the problems
of the poor nations, we need a different perspective, and we must begin by under-
standing the political and economic structures of the world we are trying to change.
We are not linked to the Third World by “aid without strings”, Oxfam, and Freedom
From Hunger alone; but by gold, by oil, by rubber, by uranium, by copper; by aircraft
carrier, by expeditionary forces, by Polaris [missile].54
Overcoming the insularity of the British movement with respect to their continen-
tal counterparts, and developing ties with other organizations both on the other
side of the Channel and in the developing world, were the aims of the contributors
to The Black Dwarf. The newspaper, founded in 1968 by a group including the

51
F.D. Scott, Sweden. The Nation’s History (Minneapolis: University of Minnesota Press, 1977),
p. 536.
52
T. Etzemuller, “A Struggle for Radical Change? Swedish Students in the 1960s,” in Schildt and
Siegfried (eds), Between Marx and Coca-Cola, pp. 239–61.
53
UNOG, UNCTAD, Arr 40 2344B41, UN Copenhagen Information Centre, “Swedish Stu-
dents demand Greater Support for Developing Countries,” May 31, 1968.
54
S. Hall, R. Williams, and E.P. Thompson, New Left. May Day Manifesto (London, 1967).
 1968: Empires and Shopping Malls 105

Pakistani intellectual Tariq Ali, celebrated its first anniversary with an editorial
congratulating itself on its achievements:
This is the spirit of the age. That spirit inspires Black Dwarf. It is the spirit of socialist
world revolution, to call things by their name. The Black Dwarf has tried not without
success to throw a bridge between the somewhat insular and traditionalist moods of
the British students and radical intellectuals on the one hand, and the temper of
“Che”, of the Vietnamese, of the French May on the other hand. It did an excellent
and necessary job in that field.55
The explosion of the student and New Left movements, however, should not ob-
scure the influence of the Catholic world in drawing attention to events in the
developing countries, and as a protagonist in its own right—albeit primarily among
its progressive minority factions—in national liberation struggles, particularly in
Latin America. Many of the progressive priests and bishops in Latin America had
studied in Europe, with a preference for the Catholic University of Louvain in
Belgium, and kept contact with the Vatican.56 We have already noted the signifi-
cance of two papal encyclicals of John XXIII and Paul VI. The latter, in the Popu-
lorum progressio of 1967, had even outlined practical measures believed necessary
to win the war on poverty in the underdeveloped world. In part of the Catholic
world, critique of the contradictions of industrial development, which had left at
the margins entire regions and social groups, went hand in hand with sympathy for
liberation movements and the rejection of the logic of the Cold War. Such was the
case of the Italian Don Lorenzo Milani, parish priest of the provincial Tuscan vil-
lage of Barbiana, who saw firsthand how the few kilometers that separated this
small town from the city of Florence were enough to cut it off from the rest of the
world. He thought that in times like those of the Vietnam War unquestioned obe-
dience to the state could no longer be considered a Catholic virtue, and in response
to those who accused him of justifying a criminal offense, for his advice from the
pulpit to avoid conscription, he argued: “If you claim the right to divide the world
into Italians and foreigners, then I tell you that I have no country, as you under-
stand it, and I uphold my right to divide the world into the disenfranchised and
oppressed on the one side, and the privileged and the oppressors on the other. The
former are my countrymen, and the latter my foreigners.”57 At the same time, in
Latin America fringes of the Catholic world were organizing in support of revolu-
tionary struggles. In 1966, Camilo Torres actually fought at the side of Colombian
revolutionaries, while the Brazilian Archbishop Hélder Cámara prayed for a social
revolution against large landowners, keeping close contact with the Sindaco
(Mayor) of Florence, the Christian Democrat Giorgio La Pira. Though not

55
E. Mandel, “Editorial,” in Black Dwarf, June 1, 1969. Available online at <http://www.ernest-
mandel.org/en/works/txt/1969/black_dwarf.htm>.
56
In 1968 the Catholic University of Louvain would help to establish in Santiago the Centro de
Estudio de la Realidad Nacional within the Catholic University of Chile that would become one of
the main think tanks for Salvador Allende’s Socialist administration.
57
Available online at <http://www.liberliber.it/mediateca/libri/m/milani/l_obbedienza_non_e_
piu_una_virtu/html/index.htm>.
106 After Empires

endorsed as official doctrine by the Catholic Church, such “liberation theology”

began to take shape by the beginning of the 1970s around the idea that armed
struggle was a necessary means “to force governments give food to the naked.”58
Evidence of just how deeply this sympathy for the liberation movements had pen-
etrated certain sectors of the Catholic Church was provided by a flyer to publicize
a “wake for the oppressed peoples and Vietnam” held on Christmas Eve 1967 in
the parish of San Ferdinando in Milan:
The existence of vast zones of guerrilla warfare in Venezuela, Colombia, Bolivia, Peru,
Guatemala, the struggle waged by blacks in America against the white government,
the guerrilla war that the people of Angola and Mozambique are fighting against Por-
tugal, the agitation of the Spanish people, the war that the people of Vietnam have
been waging for more than twenty years now, all seem to mark the beginning of a now
irreversible process.59
Characteristic of the movements throughout Europe and the United States that
together defined the “New Left” was a rejection of concepts of national interest
and Realpolitik in favor of causes believed common to all mankind, a resistance to
the authoritarian temptation in politics, and an openness to non-Western ideas for
political, economic, and social reform. Several factors help explain why these
movements enjoyed greater political leverage in western Europe than in the United
States, despite the fact that it was in America that they first came to prominence.
First, student protesters throughout western Europe succeeded in uniting them-
selves, or at least in finding common ground, with the claims put forward by the
organized labor movement or with the working class more generally. Students and
workers were often divided by opposing views on the means and ends of protest,
or by reciprocal distrust of each other’s motives. The fact remains, however, that
the two movements reinforced each other, breathing life into a season of labor
triumphs and rising living standards for workers that lasted throughout the first
half of the 1970s. In all the countries of western Europe a resurgence of trade
union activism resulted in improvements in salary levels and vacation time, work-
ing conditions, and even educational opportunities (in Italy the “150 hours” of
paid leave for auto and metal workers to pursue nonvocational schooling).60 Ten
million French people took part in strikes or demonstrations in 1968, while in
Italy the metalworkers entered into popular consciousness as a protagonist in the
economic life of the country through their part in the so-called “Hot Autumn” of
1969. In September of that same year West Germany was rocked by a wave of
coordinated strikes.61 In Italy, the connection between the students’ and workers’

58
M. De Giuseppe, “Quei ponti sospesi (attraverso l’oceano). Giorgio La Pira e le voci dell’America
latina,” in (2004) 236 Italia Contemporanea, pp. 385–408.
59
D. Saresella, “La vocazione terzomondista del mondo cattolico degli anni Sessanta e il giudizio
sulla politica internazionale statunitense,” in P. Craveri and G. Quagliariello (eds), L’antiamericanismo
in Italia e in Europa nel secondo Dopoguerra (Rubbettino: Soveria Mannelli, 2004), p. 299.
60
D. Albers, W. Goldschmidt, and P. Oehlke, Lotte sociali in Europa 1968–1974 (Rome: Editori
Riuniti, 1976).
61
F. Petrini, “Il ’68 e la crisi dell’età dell’oro,” in (2007) 12 Annali della Fondazione Ugo La Malfa,
pp. 47–73.
 1968: Empires and Shopping Malls 107

movements was explicitly underlined by the use of the term biennio rosso (“red
biennium”) in reference to 1968–9. In the words of the Italian Communist head
of the CGIL Bruno Trentin, one of the metalworkers’ leaders at the time, the joint
action of the students and workers was based on the following assumptions:
In those years a consciousness rapidly developed, if still somewhat vague, that the
construction of “rational” and all-powerful bureaucracies in various sectors of society,
rather than liberating the productive and creative capacities of human labor—as the
prophets of modernization theory had predicted—constituted an ever-greater obstacle
not only to the expansion of freedoms and civil rights, but to development and the
creativity of human labor itself.62
Better working conditions in industrial Europe were not considered antithetical to
improvements in the quality of life and greater economic independence of the
Third World. That this was so was a result of more than just a temporary alliance
of the student and labor movements. The new themes raised by 1968—including
thirdworldism—touched a deep chord in the Social Democratic parties as well as
certain segments of the conservatives and Catholics, because of both a generational
overhaul of their political classes and a comprehensive rethinking of their interna-
tional strategies. The first example of this inversion of existing trends was the
sudden change in attitudes toward the Vietnam War on the part of the major Eu-
ropean mass parties, most of which moved in only a few months from tacit accept-
ance to outright opposition.
Another difference between western Europe and the USA lay in the fact that
many leaders of the American protest movements demonstrated against Washing-
ton’s foreign policy primarily because it revealed the harm that the “dirty war” was
doing to the United States’ global image, or because it exposed the seedy under-
belly of American society. As the American writer Norman Mailer wrote in The
Armies of the Night, “[p]art of the real damage of Vietnam takes place in America
where civil rights have deteriorated into city riots, and an extraordinary number of
the best and most talented students in America are exploring the frontiers of nihil-
ism and drugs.”63 Even Eldridge Cleaver, one of the founders of the Black Panthers
who subsequently took refuge in Algiers in 1972 for his violent opposition to the
American political system, wrote: “I feel that I am a citizen of the American dream
and that the revolutionary struggle of which I am a part is a struggle against the
American nightmare.”64
European thirdworldism, in contrast, was informed not by the desire to bring
the foreign policy of nation states back to a hypothetical state of purity from a
mythical past—a notion only possible if one completely distorted the grim history
of civil and colonial wars fought by European nations—but rather by the idea of

62
B. Trentin, Autunno caldo. Il secondo biennio rosso 1968–1969 (Rome: Editori Riuniti, 1999),
p. 16.
63
N. Mailer, The Armies of the Night (New York: Penguin, 1994), p. 183.
64
C. Zanchettin, “Il Black Panthers Party. La rivoluzione internazionalista negli Stati Uniti,” in
(1972) 15 Terzo Mondo, p. 82.
108 After Empires

moving beyond the nation state and its power politics in the international arena.
This sentiment pushed some of the more radical extremists to identify themselves
with the foreign policy of other nations, like that of China or Cuba. An ocean
definitively separated the “generation of 1914,” those young nationalists who
yearned for a war of purification and unquestioningly volunteered to serve in the
First World War, from their counterparts in 1968. For sufficient proof one need
look no further than at the leaders of the youth movement: Daniel Cohn-Bendit,
one of the faces of the French student movement, was bilingual and possessed a
German passport, while Rudi Dutschke, who came from East Germany, married
an American woman and had a son named Che. Accused in the media of a lacking
both patriotism and a sense of the state, student leaders replied that, just as eco-
nomic productivity had been achieved by transcending national borders, they too
claimed the “right to organize on at least a European level.”65 The students and
youths who took part in May 1968, but also segments of the working classes, were
animated by a deep indifference to both social and political barriers.66 The end of
the 1960s had witnessed a massive increase in youth tourism within Europe. By
the mid-1970s three-quarters of youth in Germany, two-thirds in France, and
more than one-half in Britain had visited a foreign country, usually within Europe;
after 1965, Czech and Slovak youth also began to find a way to tour Austria and
Germany, while Yugoslavia had become a tourist attraction for people all over
Europe.67 The obsolescence of the nation state as the primary repository of loyalty
was also invoked by a number of advocates for local or regional autonomy, from
Basques and Catalans in Spain to Northern Ireland, whose leaders did not fail to
pick up the banner—and often the paramilitary tactics—of the revolutionaries of
the Third World liberation movements.
Though the student movements made frequent references to Europe, they only
very rarely mentioned the institutions of the European Community. The Europe
of the young was not based on the institutions in Brussels so much as it was cen-
tered on the notion of a new and poorly defined ideal of European civilization,
freed from the weight of its colonial heritage and the pursuit of power politics. This
united Europe was seen as a model of cooperation among peoples, or as the precur-
sor to an often-evoked “Third Way” between East and West.68 In 1970, in a meet-
ing of youth groups organized by the European Commission (which carefully
excluded its most radical fringe), the dominant topic of discussion was the future
role of the European Community:
The Community offers an organization of appropriate scale to create a new society
based on the fulfillment of real needs and on the responsible participation of its citizens

65
Centro di Informazioni universitarie (ed.), Documenti della rivolta studentesca francese (Bari:
Laterza, 1969), p. 47.
66
N. Young, An Infantile Disorder? The Crisis and Decline of the New Left (London: Routledge &
Kegan Paul, 1977), p. 163.
67
Nolan, The Transatlantic Century, p. 275.
68
A. Fontaine, La guerre civile froide (Paris: Fayard, 1969), p. 167.
 1968: Empires and Shopping Malls 109
and its workers. But it is vital to develop a new model of civilization and to spread the
bases for a real democracy.69
The potential offered by European integration, of a sociocultural space or identity
wider and different by its very nature from the nation state, was entirely missing
from the American political context. In Europe a sense of the damage that could
be provoked by unrestrained nationalism was certainly more diffuse and nurtured
by horrific memories of dramatic events not experienced on the other side of the
Atlantic.
While it also contributed to the birth of terrorist groups and efforts to import
“guerilla warfare,” the most significant development to emerge from the era of
European protests and passion for thirdworldism was a palpable leftward shift in
the entire political, economic, and cultural spectrum of the continent. The same
could not be said of the United States, where such critics and advocates for change
were not—and indeed did not want to be—similarly absorbed into the political
mainstream. The assassination of Robert Kennedy, like that of Martin Luther
King, left the political field wide open for more radical movements, like the Black
Panthers, which lacked the opportunities or the organizational capacity to reach
wider strata of the population. In his 1968 electoral campaign, Robert Kennedy
had outlined a new plan of economic cooperation with the Third World, and a
new societal ideal focused less on Gross National Product than on the collective
interests of the American people:
Too much and for too long, we seemed to have surrendered personal excellence and
community values in the mere accumulation of material things. Our Gross National
Product, now, is over $800 billion a year, but that Gross National Product—if we
judge the United States of America by that—that Gross National Product counts air
pollution and cigarette advertising, and ambulances to clear our highways of carnage.
It counts special locks for our doors and the jails for the people who break them . . . Yet
the Gross National Product does not allow for the health of our children, the quality
of their education or the joy of their play. It does not include the beauty of our poetry
or the strength of our marriages . . . It measures neither our wit nor our courage, nei-
ther our wisdom nor our learning, neither our compassion nor our devotion to our
country, it measures everything in short, except that which makes life worthwhile.
And it can tell us everything about America except why we are proud that we are
Americans.70
The untimely death of the young Democratic Senator made it much more difficult
to see how the twin crises of the American dollar and of American identity could
be resolved in cooperation with the other nations of the world, in particular with
its European allies.

69
HAEU, BAC 79/182, Secrétariat européen de liaison des Organizations de jeunesse, Communi-
qué, “Les organizations de jeunesse se concertent en Italie et en France,” Brussels, April 20, 1970.
70
Remarks of Robert F. Kennedy at the University of Kansas, March 18, 1968. Available online at
<http://www.jfklibrary.org/Historical+Resources/Archives/Reference+Desk/Speeches/RFK/RFK-
Speech68Mar18UKansas.htm>.
110 After Empires

LOSING ONE’S RELIGION

European nations had sent men abroad since the sixteenth century, a sign of territo-
rial conquest and colonization, scientific exploration, and the entrepreneurial spirit
of their merchants. The era of great popular migrations followed later, reaching
particular intensity in the second half of the nineteenth century, when large masses
of people resettled in Latin America and the United States, as well as in the white
British colonies.71 European emigration subsequently began a slow decline, fading
from an annual outflow of roughly 2.6 percent of the total population of the conti-
nent between 1870 and 1914, to 0.8 percent during the 1950s. That figure finally
reached zero in the 1960s, and in the 1970s Europe began for the first time to
accept a net influx of immigrants, equal to 0.5 percent of the continental popula-
tion.72 In essence, in the short span of roughly twenty years between 1950 and
1970, western Europe went from being a major exporter of its nationals to being
one of the primary destinations for immigrants from around the world. While in
1950 migratory patterns resulted in a net balance of 3 million people leaving the
continent, by 1960 that figure had declined to only 400,000, and by 1970 the bal-
ance was strongly in favor of net immigration into western European nations.73
During the same period the total number of foreigners—both European and other
(these terms are explained below)—grew from roughly 4 million to 11 million.74
In the first half of this period the dominant trend was one of intra-European
migration, and in particular the citizens of Mediterranean Europe—the Italians,
the Portuguese, the Greeks, but also the Yugoslavs—were moving to the more in-
dustrialized countries of Northern Europe. After having absorbed the traumatic
repatriation of German peoples from the East, the Federal Republic of Germany
became, along with France, the largest European importer of foreign labor. The
German government introduced legislation regulating its Gastarbeiter (“guest
workers”), signing international accords to regulate the flow of foreign workers
from Italy in 1955, from Greece and Spain in 1960, from Turkey in 1961, and
from Portugal in 1964.75 This type of immigration “on demand,” highly depend-
ent on seasonal labor needs, was considered nonpermanent and was indeed en-
couraged by the governments of the most industrially advanced European nations
in their desperate need to augment their labor forces, preferably by increasing the
number of nonunionized workers. The ceremony held in Cologne in 1964 to
herald the arrival of the millionth migrant worker—“with an official welcome and
the gift of a motorcycle,” according to news reports—in all likelihood coincided
with the peak of this intra-European migration.76 These migrants did not possess

71
Between 1821 and 1915 more than 46 million people left their home country, the majority of
whom settled in the Americas. See P. O’Brian, “L’Europa e il Terzo Mondo,” in Storia d’Europa, vol. V
(Turin: Einaudi, 1996), p. 1308.
72
Jha, The Twilight of the Nation State, p. 75.
73
J. Foreman-Peck, “L’Europa conquista il mondo,” in Storia d’Europa, vol. V, p. 1421.
74
K. Bade, Migration in European History (Basingstoke: Palgrave, 2003), pp. 217–18.
75
F. Romero, Emigrazione e integrazione europea 1945–1973 (Milan: Edizioni Lavoro, 1991).
76
Mazower, Dark Continent, p. 325.
 1968: Empires and Shopping Malls 111

the same rights as local workers, were paid lower salaries, and were expected to
return to their native countries if the economy turned down or, in any event, once
they had accumulated enough savings to open their own family business in their
homeland. European immigrants, in short, were treated like second-class citizens.77
These spaghettis, as the Italians were called in France, may have had strange habits
and debatable taste in dress and manners, but at least they were white and Chris-
tian, and they shared a certain common history rooted in the horrific experience of
the two world wars. Among the reasons for the decline of this intra-European emi-
gration were the economic boom in certain regions like the Italian north, which
began to attract workers from the mezzogiorno, and the completion of the Euro-
pean Common Market in 1968, which disincentivized demand for labor from
other Community nations by granting all its workers the same rights as accorded
to domestic labor.
In the course of the 1960s extra-European immigration began to replace migra-
tion within the Community. The influx of peoples from Asia, Africa, and the Car-
ibbean largely reflected past colonial ties. Such population movements also
coincided with the explosion of birth rates and increases in life expectancy in Third
World countries, improvements due to advances in the medical field and in agri-
cultural productivity.78 It was these processes that caused Pakistanis, Indians, and
Afro-Caribbean peoples to settle in Great Britain, and Algerians, Senegalese, and
other Francophone Africans primarily in France. In Germany, it was Turkish im-
migration that predominated; in Holland, the inhabitants of the former Dutch
East Indies. The result of all this immigration was that by the end of the 1960s
there were more than 3.2 million foreign residents—both European and other—in
France (totaling some 6.4 percent of the population), 3 million foreigners in West
Germany (4.8 percent), 2.6 million in Great Britain (5 percent), and 1 million in
Switzerland (16 percent).79 In Germany alone the number of foreign laborers in
the workforce grew from 0.4 percent in 1954 to 10 percent in 1971.80 The major-
ity of these immigrants were not European. A Financial Times special report of
1973 noted that 35 percent of German Gastarbeiter toiled in the metalworking
industry, concentrated primarily in the large metropolitan areas. In Stuttgart, for
instance, one worker out of every four was a foreigner, a trend which left a visible

77
M. Colucci, Lavoro in movimento. L’Emigrazione italiana in Europa 1945–57 (Rome: Donzelli,
2008).
78
M. Livi Bacci, La populazione nella storia d’Europa (Bari: Laterza, 1998), p. 235;P. Bairoch, Storia
economica e sociale del mondo. Vittorie e insuccessi dal XVI secolo ad oggi (Turin: Einaudi, 1999),
p. 1042.
79
Foreign residents by country at the end of the 1960s: In the Federal Republic of Germany, Ital-
ians (575,000), Yugoslavs (515,000), Turks (470,000), and Greeks (350,000); in France, Algerians
(650,000), Spanish (617,000), Italians (615,000), Moroccans (145,000), Tunisians (90,000), and
other Africans (55,000); in Great Britain, Irish and other Europeans (740,000), Caribbeans (270,000),
Indians (240,000), and Pakistanis (75,000). See U. Melotti, “Migrazioni internazionali e integrazione
sociale: il caso italiano e le esperienze europee,” in Marcella Delle Donne and Umberto Melotti (eds),
Immigrazione in Europa (Rome: Centro europeo di studi sociali, 1993), p. 35.
80
A. Sutcliffe, “Cold War and Common Market: Europe, 1945–1973,” in A. Sutcliffe and D.H.
Aldcroft (eds), Europe in the International Economy 1500 to 2000 (Cheltenham: Edward Elgar, 1999),
p. 198.
112 After Empires

impact on daily life in such cities: “Go to the railway stations of these cities, or
Munich, on a Sunday—when the Gastarbeiter congregate as though at a kind of
club—and it may prove difficult to find anyone who speaks much German.”81
This new form of immigration, which contributed greatly to the growth of Eu-
ropean economies, also structurally linked western Europe to certain regions of the
developing world.82 Non-European immigrants were willing to perform the most
menial of tasks, which required little or no professional training: Jobs in manual
labor and personal services—bricklayers, garbage men, janitors, porters, etc.—that
Europeans had learned to consider beneath them. These immigrants were thus
useful, but at the same time they raised uncomfortable questions about integra-
tion. First, such immigrants were rarely Christian; not infrequently they found
their customs in open conflict with European notions of the family, most obvi-
ously in the case of Africans practicing polygamy. Second, they stood out by the
color of their skin. Finally, their arrival from far-off shores appeared to be perma-
nent, a disturbing portent for European nations that had failed to develop any
systematic policy for the inclusion of such minorities and which, throughout the
1960s, tended still to deny their very existence. The nations of western Europe,
having lost empires, endured waves of population transfers and the return of refu-
gees, and witnessed the tragic destruction of European Jewry, had only just re-es-
tablished a precarious ethnic homogeneity: But already issues of national identity
were once more called into question!
Right at the close of the decade, the European political classes began to show
signs of paying attention to the question of immigration. In April 1968, the British
Conservative MP Enoch Powell delivered his “rivers of blood” speech, setting the
tone for a new, racist, xenophobic political discourse. Powell claimed that by the
end of the millennium there would be as many as 7 million immigrants from
the Commonwealth in Great Britain, and declared his belief that in such a world
all decent mothers—all white women—would be forced to leave the country. He
then spoke the words by which the speech would come to be remembered: “As I
look ahead, I am filled with foreboding. Like the Roman, I seem to see ‘the River
Tiber foaming with much blood’.”83 The voice of Powell’s Cassandra was a decided
minority, however, in the broader political and cultural chorus of a world in which
the hopes and curiosity of the youth of 1968 sang the dominant chord; in fact, the
very same youth charged the police escort assigned to the nationalist politician in
order to prevent him from speaking at Oxford.84 Until the late 1960s on average
the booming economies of western Europe absorbed the mass of immigrant labor
quite well, primarily because such labor was intended only to be temporary.85

81
J. Carr, “Coping with an army of foreign workers,” in Financial Times, October 8, 1973.
82
C.P. Kindelberger, Europe’s Postwar Growth. The Role of Labour Supply (Cambridge, MA: Harvard
University Press, 1967).
83
Available online at <http://www.telegraph.co.uk/comment/3643823/Enoch-Powells-Rivers-of-
Blood-speech.html>.
84
S. Heffer, Like the Roman. The Life of Enoch Powell (London: Weidenfeld & Nicolson, 1998),
pp. 504–5.
85
E. Comte, ‘La formation du régime de migrations de l’Europe communautaire, de 1947 à 1992’.
Unpublished article.
 1968: Empires and Shopping Malls 113

Subsequently, and only very gradually, public opinion would become aware or
fearful of the opportunities and risks that accompanied the multicultural
society.86
The Third World had moved to the center of European sociopolitical debates
through the influence of the Catholic and student movements and the high public
visibility of immigration. The arrival of the Third World on European shores also
had a profound impact on culture and the arts in general, not just among the élite,
as well as on modes of thought and the most basic of everyday customs, like dining
habits. It touched entire families, for example, which by frequenting ethnic mar-
kets and restaurants widened the popularity of Turkish cuisine in Germany or
Moroccan food in France. Hobsbawm has noted how the Nobel Prize for Litera-
ture—an indicator of the cultural “balance of power” which had been awarded to
an American author (Sinclair Lewis) for the first time only in 1930—discovered
the existence of “other” literatures beyond those of Europe and North America in
the 1960s.87 By the 1970s no Western reader with the slightest pretensions to edu-
cation or refinement could claim to ignore Latin American literature. The Italian
author and critic Alberto Asor Rosa, in a broad survey of his country’s literature,
claimed that after Italo Calvino and Pier Paolo Pasolini, Italian authors no longer
measured themselves against the masters and traditions of their nation’s past, but
rather—in the absence of “great ideas”—against a global literature.88 Even more
paradigmatic was the case of the most famous pop group of the century: The
Beatles. The four lads from Liverpool, a city symbolic of the economic crisis in
England’s industrial north, first captured the world’s attention by playing the
rhythms of rock and roll while dressed in the most classic of British attire, impec-
cably turned out in coats and ties, symbols of Western elegance. But toward the
end of the 1960s they began to experiment with new instruments and new sounds
drawn from their voyages to India, wearing the less constrictive clothing of the
subcontinent.89 The British playwright Tom Stoppard’s absurdist comedy Rosen-
crantz and Guildenstern Are Dead, staged for the first time at the 1966 Edinburgh
Festival Fringe, told the story of its eponymous title characters, two bit parts in
Shakespeare’s great tragedy Hamlet, epitomizing the search for new perspectives
outside the safe boundaries of traditional Eurocentric culture.
Particularly evident, by the end of the 1960s, was the mounting cultural attack
on nationalism as the driving force of political action. This was especially true in
the Federal Republic of Germany, where intellectuals kept questioning the never
fully-severed links between the country’s political elite and their past militarism or
overt Nazi affiliations. But this assault also incorporated new research into the co-
lonial pasts of the European nations and into their crimes that, as we have seen,

86
L. Lucassen, The Immigrant Threat. The Integration of Old and New Migrants in Western Europe
Since 1850 (Chicago: University of Illinois Press, 2005), pp. 215–18.
87
Hobsbawm, The Age of Extremes, pp. 502–3.
88
A. Asor Rosa, Storia europea della letteratura italiana, vol. III (Turin: Einaudi, 2009), p. 579.
89
A. O’Hagan, “Back in the US of A,” in (2004) 51(9) The New York Review of Books.
114 After Empires

had not been seriously examined by historians before this; such scholarly research
also underlined the potential agency of the colonized, and the fact that they had a
history independent of that of their prior European masters.90 Social scientists even
began to question the idea that national identity was a matter of real importance:
Nations had not existed forever, commanding allegiance from their inhabitants. In
1969, the Norwegian anthropologist Frederick Barth published a set of essays that
portrayed national identity as little more than an instrument for personal advance-
ment, with individuals shifting allegiance as they found this convenient.91 It would
appear that the decreasing identification of European youth with their nation was
an element that encouraged the formation of nongovernmental organizations, mo-
tivated by the shared sense of being part of a humanity that was bound together by
universal human rights to be preserved and defended across all political and geo-
graphical boundaries.
The international organizations set up to foster cooperation between the United
States and western Europe were quick to recognize the potential for disenchant-
ment with American models of modernization and search for alternatives pre-
sented by the course of events. The Ford Foundation realized it was no longer
sufficient merely to finance conferences of intellectuals to influence a European
society undergoing rapid change driven by movements engaging youth, women,
and a revitalized working class.92 In the eyes of McGeorge Bundy, one of the stra-
tegic architects of the American intervention in Vietnam and the new President
of the Ford Foundation, the 1950s—dominated by the Cold War and character-
ized by a need for stability and nonideological pragmatism—were out of style.
The key to understanding contemporary youth’s adoration of Mao, Fidel, and
Black Power lay, he thought, in the recognition of their common rejection of a
culture privileging modernization. According to Bundy, youthful solidarity with
labor movements had given way to solidarity with the peoples of the former colo-
nies, and pacifism to the cult of necessary violence. This was not exactly what was
really taking place: A new solidarity of the young with the working classes was
forming, forged not by a sense of superiority but by a perceived common need for
change. Taking stock of the new challenges presented by Europe, the Ford Foun-
dation began to turn its attention to the problems of the Third World as part of a
new strategic design to create new spaces for the diffusion of the American model.
The words of an analyst of the Program for Foreign Leaders on the decline of the
American myth at the end of the 1960s were unequivocal: “[Europeans] no longer
see America as the goal for the future, but now fear that what we have been, they
too will become.”93

90
J. Darwin, After Tamerlane: The Global History of Empire since 1405 (New York: Penguin, 2008),
pp. 6–14.
91
Described in P. Heather, Empires and Barbarians. The Fall of Rome and the Birth of Europe
(Oxford: Oxford University Press, 2010), p.15.
92
V.R. Berghahn, America and the Intellectual Cold Wars in Europe. Shepard Stone Between Philan-
thropy, Academy and Diplomacy (Princeton, NJ: Princeton University Press, 2001).
93
Scott-Smith, Networks of Empire, p. 44.
 1968: Empires and Shopping Malls 115

T H E C L O S I N G C I RC L E

It has been said that the industrialized nations’ perceptions of the Third World
constituted a process of transference which reflected their own dissatisfaction with
Western models of development. Rossana Rossanda, an Italian intellectual close to
her country’s New Left, described this critique of the foundations of Western in-
dustrialized society:
It was all too easy to see the fragility of this uprising of a generation that didn’t oppose
itself, as we did, to “reaction” but to the entire architecture of the capitalist system: We
claimed the right to education, they laid siege to the universities as the instrument of
consent; we argued for the right to work, they wanted the end of wage labor; we
wanted a more just distribution of resources, and they couldn’t have cared less about
consumerism. To them, the world appeared guilty for everything . . . They were the first
generation to protest against progressivism.94
Such protests against the intellectual architecture of progressivism and moderniza-
tion theory provide a key to understanding the evolution of economic thought at
the end of the 1960s. Radical economic ideas were spreading, in part through
Europeans’ constant dialogue with economists from the developing world.95 By the
end of the decade, the concept of economic imperialism was widely accepted,
alongside that of military imperialism, as an analytic paradigm for the interna-
tional economy and the role played in it by the industrialized nations. Eduardo
Galeano was only thirty when in 1971 he published Open Veins of Latin America.
The book by the Uruguayan journalist, subtitled Five Centuries of Pillage of the
Continent, was to become classic reading for world radicals by showing how the
Europeans and the USA, with the support of the very same Latin American elites,
were able to impoverish the continent and the majority of its inhabitants first by
extracting raw materials for their own purposes, and later by also swallowing up its
new-born industries:
This book, which seeks to chronicle our despoliation and at the same time explain how
the current mechanisms of plunder operate, will present in close proximity the carav-
elled conquistadores and the jet-propelled technocrats; Hernan Cortés and the Ma-
rines; the agents of the Spanish Crown and the International Monetary Fund missions;
the dividends from [the] slave trade and the profits of General Motors.96
The French Marxist economist Pierre Jalée, in his classic monograph on the “pil-
lage of the Third World,” first published in 1965, highlighted the extraordinary
wealth of the developing world in terms of raw materials: In 1962, over half the
world’s petroleum and copper were extracted from the Third World, 139,000 of

94
R. Rossanda, La ragazza del secolo scorso (Turin: Einaudi, 2005), p. 357.
95
A. Dirlik, “The Third World,” in C. Fink, P. Gassert, and D. Junker (eds), 1968: The World
Transformed (Cambridge: Cambridge University Press and German Historical Institute, 1998),
p. 314.
96
Eduardo Galeano, Open Veins of Latin America. Five Centuries of the Pillage of the Continent (New
York: Monthly Review Press, 1997), p. 8.
116 After Empires

165,000 tons of all ethanol, 17 out of 25 million tons of all bauxite, two-thirds of
all zinc, some 70 percent of all diamonds, and so forth.97 This list served to prove
the author’s contention that the “proletarian nations” were just that, not because
they were the victims of some hypothetical original sin, but rather because of their
riches: “they have been and continue to be pillaged by the imperialist nations for
their own industrial needs.”98 A third classic account, the Guyanese economist and
activist Walter Rodney’s 1973 bestseller How Europe Underdeveloped Africa, cen-
tered on the idea that there would have been no European industrialization had
this not been supported by the African slave trade and raw materials. Writing in a
similar vein as Galeano, Rodney insisted that that the European capitalist concep-
tion of development damaged African communitarian society.99 The same idea was
put forward by the Franco-Greek economist Arghiri Emmanuel. In his book Un-
equal Exchange, he strove to demonstrate that the industrialized world appropri-
ated for itself the value added by Third World labor and resources, and that Western
labor movements were themselves partially complicit in this exploitation by fight-
ing to protect the higher salaries of their workers. According to Emmanuel the
only way to exit this vicious circle would be a constant rising of prices for the raw
materials produced by the developing world.100 His thesis provoked countless de-
bates. Charles Bettelheim, editor of the French series that published the book,
criticized the idea of unequal exchange for considering the conflict between prole-
tarian and wealthy nations of greater importance than that between the proletariat
and the bourgeoisie. Whatever the distinctions that separated one approach from
the other, the debate held with ever greater frequency among economists, even in
university departments, was not over the existence of economic imperialism—by
now an accepted fact—but rather over the way to prevent international economic
institutions from contributing to the structural impoverishment of those countries
in the process of development.
These analyses made the battle fought within UNCTAD to modify the rules of
international trade seem excessively pedantic, and suggested that more direct action
was necessary in the economic conflict between North and South. The objective
for the countries of the South remained one of rapid, forced industrialization, as
recommended by Prebisch; but the tools of economic diplomacy, intended to
reform international economic institutions, were beginning to be joined by those
of open conflict, aimed at a frontal assault on the economic interests of the indus-
trialized countries themselves.
In debates over the reform of international economic structures, the controver-
sial case of the English economist Teresa Hayter served as a cautionary tale to both
sides. Hayter initially worked for the British Overseas Development Institute
under the leadership of Professor John White, publishing in 1967 a book on aid

97
P. Jalée, Le pillage du tiers monde (Paris: François Maspero, 1965).
98
Ibid., p. 27.
99
W. Rodney, How Europe Underdeveloped Africa (Dar-Es-Salam: Tanzanian Publishing House,
1973).
100
A. Emmanuel, L’échange inégal. Essai sur les antagonismes dans les rapports internationaux (Paris:
François Maspero, 1969).
 1968: Empires and Shopping Malls 117

for development that, in line with the spirit of the times, called for a substantial
increase in the allocation of funds for such purposes. While preparing a new work
on development aid, financed by the World Bank, she had the opportunity to in-
terview dozens of officials in Washington, as well as bureaucrats and experts on the
subject from several developing countries. When she submitted a first draft of the
text, she was invited repeatedly to revise the manuscript, which was ultimately
rejected by the Bank’s reviewers. In her introduction to the book, subsequently
released by a commercial publishing house in 1971 under the title Aid as Imperial-
ism, Hayter wrote:
The availability of “official aid” increases the likelihood that the governments of Third
World countries will tolerate the continuation of massive outflows of private profits
and interest on past debts. It may help to bolster up such governments by providing a
few short-term solutions to their economic difficulties. It may also help to create and
sustain, within Third World countries, a class which is dependent on the continued
existence of aid and foreign private investment and which therefore becomes an ally of
imperialism.101
The tone of this paragraph alone would have justified the Bank’s alarm. From such
isolated cases of individual scholars, all more or less well-versed in Marxist theory,
the abandonment of the Rostowian paradigm of modernization and growth began
to spread like wildfire to the most prestigious universities and even to international
economic institutions themselves. Dudley Seers, the director of the Institute for
Economic Development at the University of Sussex, a body with close ties to the
British Foreign Ministry, opened the 1969 academic year with a speech critical of
Gross Domestic Product as a measure of development. Simple growth in produc-
tivity, he explained, could be linked to the formation of entrenched elites who
zealously guarded their privileges and were uninterested in accompanying such
growth with programs for social spending or redistribution of wealth. According to
Seers, the real questions to ask about development were: “What has been happen-
ing to poverty? What has been happening to unemployment? What has been hap-
pening to inequality?”102 Even more controversial was the 1970 announcement by
the head of the UN’s International Labor Organization (ILO), David Morse, who
provocatively claimed that GDP had been “dethroned.” Morse’s declaration opened
the doors for international economic organizations to change their policy on de-
velopment to what would come to be called the “basic needs strategy”: Concentra-
tion on poverty and on primary needs like healthcare and education, rather than
an obsession with productivity and growth in profits.
In 1969, the Commission on International Development, headed by the former
Canadian Prime Minister Lester Pearson, presented its report to the World Bank,
following up on the mandate issued to it by the Bank’s President George Woods in
1967. Woods had observed with growing alarm how the quantity of development

101
T. Hayter, Aid as Imperialism (London: Penguin, 1971), p. 9.
102
H.W. Arndt, Economic Development. The History of an Idea (Chicago: University of Chicago
Press, 1987), p. 91.
118 After Empires

aid had undergone a steady decline through the years, and the Pearson report,
unsurprisingly, made several familiar recommendations: A growth in aid to reach
the target of 0.7 percent of public aid; a gradual passage toward more multilateral
aid to reach upwards of 20 percent of total aid; the “untying” of aid and encourage-
ment of private investment; and facilitating access by the developing nations’ prod-
ucts to industrial countries. Even if these ideas were motivated by a reformist spirit
mostly lacking in the World Bank’s activities during the previous decade, they were
by now judged to be insufficiently radical by both the developing countries and
Western experts in the field. In a packed conference of economists, political lead-
ers, and experts on questions of development held over the course of a week from
February 15–21, 1970 at Columbia University in New York, following hours of
impassioned debates conference organizers issued a statement declaring the Pear-
son report to be inadequate because it failed to take into consideration the decline
in commodity prices and unemployment, as well as the growing influence of mul-
tinational corporations. The report had failed, in other words, to take into account
the structural problems that blocked the path of Third World development: “We
leave this conference with the conviction that there is nothing more unrealistic
than the apparent realism of those who argue that the Pearson report is fully ade-
quate or even overambitious in terms of the future prospects.”103
After 1968 the World Bank, under the new presidency of former US Defense
Secretary Robert McNamara, seemed to slowly adjust to this changing climate. Its
officials could not help but notice how investments in productivity and growth in
GDP had failed to halt the civil war in Indonesia, racial tensions and strife in
Malaysia, and, even more significantly, the outbreak in 1971 of hostilities between
the two nations which had been the greatest beneficiaries of the Bank’s loans, India
and Pakistan. McNamara began to prioritize the question of population control as
a brake against the erosion of GDP per capita, and initiated a move from financing
by program to financing per project, which allowed money to be better directed
toward education and agriculture, a restructuring of funding that reduced invest-
ments in India and Pakistan—areas of strategic interest to the United States—to
no more than 65 percent of the total.104 In a 1973 speech in Nairobi, McNamara
appeared to have officially launched this new strategy, more attentive to inequality
than to growth: Aid alone, deprived of the ability to intervene to improve growth,
did not provide the expected results. McNamara recalled how in Vietnam the
United States had spent the stratospheric sum of $168 billion between 1962 and
1975—a figure greater than the total of all aid of any kind given by the industrialized
world to the developing nations during that same period—without rendering the
guerrilla war any less popular, or the government of the South any less hated.105

103
B. Ward, The Widening Gap. Development in the 1970s (New York: Columbia University Press,
1987).
104
WBGA, Office of the President, Records of Robert S. McNamara, General Correspondence,
Box 1, “Memorandum on Informal Meeting with Representatives of Part I Countries Concerning
IDA Lending Program,” September 29, 1969.
105
Wood, From Marshall Plan to Debt Crisis, p. 197.
 1968: Empires and Shopping Malls 119

The evolution in the World Bank’s reasoning was not received with great fanfare
in the developing world, where few wished to hear about population control as a
tool for resolving underdevelopment. Even fewer wanted to see tighter controls
over the purse strings from which such aid was distributed.
Alongside the theories emerging from the world of professional development
economists, others voiced ideas critical of the damage caused by industrialization
and the predatory logic of capitalism itself. These critics condemned industrial
growth and modernization, not only for its exploitation of the working classes or
the underdevelopment into which it confined the poorest corners of the planet,
but more generally for the destructive power of the capitalist model of develop-
ment on the natural environment and the resulting concerns for the quality of
human life.
Intellectuals outside the established political or academic orthodoxy began
having an impact on public debates, influencing, as we shall see, certain segments
of the traditional left. Ivan Illich was born in Vienna, educated as a priest in Rome,
worked for the integration of Puerto Ricans in New York, and ended up opening
a globally renowned research center in Mexico in the 1960s from which he con-
tinuously attacked the Alliance for Progress, the Peace Corps, and all the other
“multinationals for the export of optimism.” In an essay published for the first time
in the French magazine Esprit in 1972, Illich criticized the very essence of indus-
trialized society, responsible in his view for an irresponsible excess of productivity
that reduced the potential for genuine human interaction and created an over-
abundance of unnecessary goods and services. He argued for a measure of austerity,
not as a moral censure to deprive people of the fruits of their labors, but to elimi-
nate that excess of productivity without which there might be greater space and
time to enjoy such pleasures, or perhaps even room for growth in the productivity
of those less-developed areas of the world.106 In another essay begun before the oil
crisis of 1973, Illich criticized the trend to prize ever greater increases in speed and
haste in society, epitomized by the dominance of the automobile, which marginal-
ized other commuter means like the bicycle without necessarily improving the ease
of urban transportation, and even creating new social divisions based on unequal
access to such rapid means of transport: “It is urgent to clarify the reality that the
language of crisis obscures: High quanta of energy degrade social relations just as
inevitably as they destroy the physical milieu.”107 He further criticized the health-
care industry and nationalized health services which, given ever greater sums of
money, deprived individual citizens of their natural defenses against the most
common of illnesses through the standardized prescription of medications applied
indiscriminately throughout whole communities. A cosmopolitan intellectual,
Illich himself constituted a literal representation of the global ferment of ideas that
moved beyond Marxism and notions of class conflict to focus on quality-of-life
concerns and the impact of human endeavors on the environment. Another essay
by another such cosmopolitan intellectual, the German-born student of Keynes

106
I. Illich, Tools for Conviviality (New York: Harper & Row, 1973).
107
I. Illich, Energy and Equity (New York: Harper & Row, 1974), p. 3.
120 After Empires

and lead economist of the British National Coal Board Ernst Friedrich Schu-
macher, would become one of Time magazine’s 100 most influential books of the
twentieth century. Published in 1973 with the eloquent title Small is Beautiful:
Economics as if People Mattered, Schumacher raised awareness of the damage pro-
duced by large-scale industrialization, calling for a return to the local, a scale of
activity more apt to produce improvements in the quality of life.108 One of its four
chapters was dedicated to the Third World, suggesting models of development that
did not simply imitate Western models, and calling for a revolution in aid distribu-
tion. The economist Richard Easterling’s paradox, published in 1974, went more
or less the same way by arguing that there was no common world scale of material
aspirations that could be used as a model and that “the positive correlation be-
tween income and happiness that shows up in within-country comparisons ap-
pears only weakly, if at all, in comparisons among societies in space and time.”109
Other critics attacked the foundations of the economic systems on the basis of
one of the most visible subjects of protest against the consequences of the indus-
trial economy: Pollution. Until 1945, in fact, the already intolerable levels of pol-
lution in the world’s great urban centers were produced primarily by two sources,
fossil fuels and heavy industry, in addition to rising levels of common garbage. But
after 1945 the world witnessed unchecked growth in the production of synthetic
materials, nonrecyclable plastics, pesticides and detergents that poisoned fields and
waterways, and finally in the popularity of the automobile, with its gaseous emis-
sions. In 1967 the shipwreck of the supertanker Torrey Canyon near Cornwall,
which caused an environmental disaster spilling some 100,000 tons of oil off the
English coast, raised concerns about the precarious instability and the dangers
presented by a system that remorselessly devoured ever-increasing amounts of
energy.110 In one of the earliest bestsellers on the question of the environment, the
American biologist Barry Commoner postulated that the creation of nonrecyclable
waste was breaking the natural cycle of life, death, and decomposition, and that it
was urgently necessary to make profound technological changes to restore a sus-
tainable equilibrium.111 His approach was animated by an optimism about the
possibilities for a more conscious civilization, more aware of the environment’s
natural limits and less beholden to an uncritical adulation of modernity. In con-
trast, the 1972 Club of Rome report titled The Limits to Growth—promoted by the
Italian Aurelio Peccei, a manager of the Italian car company FIAT who had estab-
lished a worldwide network of intellectuals, economists and managers of different
political beliefs—was written in a darkly pessimistic vein that emphasized the ap-
parent limits of natural resources, from agriculture to energy, available on planet

108
E.F. Schumacher, Small is Beautiful: Economics as if People Mattered (New York: Harper & Row,
1975).
109
R.A. Easterlin, “Does Economic Growth Improve the Human Lot? Some Empirical Evidence,”
in P.A. David and M.W. Reder (eds), Nations and Households in Economic Growth: Essays in Honor of
Moses Abramovitz (New York: Academic Press, 1974), p. 119.
110
Ponting, A Green History of the World.
111
B. Commoner, The Closing Circle: Nature, Man and Technology (New York: Knopf, 1971).
 1968: Empires and Shopping Malls 121

Earth.112 This Malthusian concept of finite resources, like Commoner’s environ-

mentalism, could be exploited not only to warn the industrialized countries and
invite them to adopt a more sober attitude, but also to limit Third World nations’
pretensions to development.
The liberation movements of the Third World, the protest movements of the
young and the working classes, and the evolving neo-Marxist intellectual currents
had opened Europe’s doors to a partial rethinking of economic science, and to re-
consider the damage caused to the nations of the Third World, to the Earth, and
to all mankind by Western models of development. Far from being confined to the
USA or western Europe, this critique also indicted many of the ruling elites in the
oil-producing countries, a primary example being the former Venezuelan oil min-
ister Pérez Alfonzo, an admirer of Ivan Illich who eventually came to define crude
oil as “the Devil’s excrement.”113
How to marry economic growth in the less-developed areas of the world with
opportunities for greater equality within the West? How to obtain better working
conditions for Western workers and simultaneously support a structural redistri-
bution of resources toward developing countries? How to pay attention to the en-
vironment without halting the development of technological innovation where it
was most needed? These were the questions and challenges which confronted those
at the intellectual frontiers of economic thought in the 1970s. These themes were
all interrelated and, we shall see, would provoke confrontations—albeit with dif-
ferent degrees of awareness and in a social climate marked by rising tensions—
among political and trade union elites as well.

112
D. Meadows et al., The Limits to Growth: A Report for the Club of Rome’s Project on the Predica-
ment of Mankind (New York: Universe Books, 1972). On the history of the Club of Rome report see
L. Piccioni and G. Nebbia, “I Limiti dello sviluppo in Italia. Cronache di un dibattito 1971–74”, in
(2011) 1 Altro 900. I quaderni di Altronovecento.
113
J.P. Pérez Alfonzo, Hundiéndonos en el excremento del Diablo (Caracas: Editorial Lisbona
1976).
 4
The Developing Countries’
“Most Favored” Partner

The winds of change unleashed by 1968 affected the European political climate, by
altering parliamentary majorities and bringing new issues to the attention of party
leaders. Richard Nixon aptly summarized the new political scenario to Henry
Kissinger:
The way the Europeans are talking today, European unity will not be in our interest,
certainly not from a political viewpoint or from an economic viewpoint. When we
used to talk about European unity, we were thinking in terms of the men who would
be at the top of Europe who would be in control. Those men were people that we
could get along with. Today, however, when we talk of European unity, and when we
look ahead, we have to recognize the stark fact that a united Europe will be led prima-
rily by left-leaning or socialist heads of government. I say this despite the fact that
Heath is still in power. Even in Britain and France we have situations where the media
and the establishment strongly pull to the left at this point, and also where the media
and the establishment take an increasingly anti-US attitude.1
The European left had gained the moral high ground even though it had to endure
the tensions provoked by challenges from both a reactionary right and a revolution-
ary left, as well as the periodic threats from various—and not necessarily European—
terrorist movements.2 As the head of the Italian Central Bank, Guido Carli, was
himself forced to admit, “the ‘hot autumn’ of 1969 forced us to change our interpre-
tative keys to monetary phenomena”; after the biennio rosso any effort to impose a
more restrictive monetary policy would inevitably be perceived as “subversive.”3
After the caution of the 1960s, new western European leaders—especially the
British Prime Minister Edward Heath, the French President Georges Pompidou,
and the German Chancellor Willy Brandt, all three of whom came to power in
1969–70—did not hesitate to support the relaunching of European unity as a
means to offer an outlet for social tensions, and to respond to the numerous claims

1
FRUS, Foreign Economic Policy, 1973–76, n. 31, draft memo from President Nixon to the Presi-
dent’s Assistant for National Security Affairs (Kissinger), March 10, 1973.
2
Tony Judt considers 1968 to be a marginal event, giving it a largely negative spin for the dispro-
portionate influence exerted on many of its protagonists by an anachronistic view of Marxist theory
and thirdworldist mythology. Pierre Chassaigne, in contrast, sees the 1970s as a caesura, from an
international relations perspective, in which lie the origins of our “modernity”: see Judt, Postwar,
pp. 360–89; P. Chassaigne, Les années 1970. Fin d’un monde et origine de notre modernité (Paris:
Armand Colin, 2008), pp. 50–86.
3
G. Carli, Cinquant’anni di vita italiana (Bari: Laterza, 1996), p. 230.
 The Developing Countries’ “Most Favored” Partner 123

for regional autonomy unleashed by 1968.4 With the Hague summit of December
1969, the heads of state and government of the Six opened the door for Great
Britain’s entry into the European Community, began to work toward closer eco-
nomic and political coordination, and even reached an agreement on a first, albeit
limited, effort at cultural cooperation by giving the go-ahead to the creation of a
European University—what would become the European University Institute at
Fiesole, inaugurated in 1976.5
Thanks to the increasingly insistent pressures of a European public opinion disil-
lusioned with a power politics based on military might and infused with a new
consciousness of the vastness of the problems confronting the Third World, the pri-
orities of European Community governments—both socialist and other—began to
change in three important aspects. First came a recognition of the need to reinforce
the politics of an active détente with the Soviet Union, which would allow govern-
ments to cut further military spending and open dialogue on all matters, including
economics, with the East. Second was a commitment to deepen western Europe’s
economic and political integration, in order to reinvigorate Europe as an economic
area, incentivize technological innovation, redistribute resources to more disadvan-
taged areas, and provide a parallel imagined community that could act as a possible
alternative identity in place of discredited nationalism but also of increasingly dis-
credited American and Soviet models. Finally, there was the search for a common
ground with the developing countries, aimed at finding new commercial outlets but
also at building political bridges for formerly imperial powers that seemed ready to
recover some capacity for autonomous action on the international stage.

T H E AT L A N T I C W I D E N S

While the political shift to the left carried unique implications within the cultural
context of each individual nation, in all the western European countries it marked
a common rise in social concerns. In Italy, for example, the creation of factory
councils (consigli di fabbrica), and later of neighborhood and school councils, were
a direct response to a popular impulse for political participation. In France, impor-
tant segments of the trade unions believed in such “self-government” (autogestion)
as a third way between the planning of real socialism and the free market economy.
The editor of the newsletter of the Conféderation Française Démocratique du Tra-
vail (CFDT) accorded such self-governance “the role that was once that of democ-
racy and of socialism.”6 Throughout the Western world—or at least the OECD
countries—the percentage of GDP allocated to public spending, static throughout

4
On the efforts from 1969 to 1974 by the new leaders of France, Germany, and Britain to create
a common European foreign policy, see D. Möckli, European Foreign Policy during the Cold War:
Heath, Brandt, Pompidou and the Dream of Political Unity (London: IB Tauris, 2008).
5
J.M. Palayret, “‘A Great School in the Service of a Great Idea.’ The Creation and Development of
the European University Institute in Florence,” in (1997) 1(3) EUI Review, pp. 1–3.
6
P. Rosanvallon, L’âge de l’autogestion: Ou la politique au poste de commandement (Paris: Editions du
Seuil, 1976), p. 15.
124 After Empires

the 1950s, rose only four points to 31 percent in the 1960s, but reached 40 percent
by 1980. In western Europe the state’s contribution to the growth of GDP was
even greater, passing 45 percent and, in the cases of Holland and Sweden, reaching
nearly 60 percent.7 The growing role of the public purse in both manufacturing
and the provision of services to citizens, not to mention the apparent cultural
hegemony of Marxism or its various leftist offshoots, led liberal intellectuals like
Raymond Aron to speak of Europe’s decline. With a desperate cri de coeur, he
lamented western Europe’s seemingly inexorable slide toward eastern European-
style communism:
Today western Europe, after twenty-five years of an economic growth without prece-
dent, is unquestionably floundering in a crisis at once economic, political, and spirit-
ual. This is why men of little faith turn to a future that they already consider inevitable.
In 1974, during the electoral campaign, I was struck by the contrast between the
number of signatures at the bottom of certain petitions in favor of François Mitter-
rand and Valéry Giscard d’Estaing: on the former, hundreds; on the latter, at most
several dozens. It was as if the lawyers, the university professors, the writers, the actors
were by a vast majority all supporters of the social-communist opposition, while eve-
ryone else, perhaps an equally numerous group, dared not expose themselves to the
risk of declaring themselves openly in favor of a man held to be on the right or, at least,
an opponent of the left.8
The golden age of social democratic parties began in 1969, with the first govern-
ment led by a social democratic majority in the Federal Republic of Germany and
the nomination of Willy Brandt, former Foreign Minister and mayor of Berlin, as
its Chancellor. The country at the center of Europe’s fragile Cold War equilibrium
had finally overcome its reservations about socialism, and the foreign policy activ-
ism of the new Chancellor no longer ran the risk of being mistaken for neutrality
toward the Soviet Union. In that same year Olof Palme overcame another taboo of
the normally pro-Atlantic social democrats, allowing himself to be captured on
television arm in arm with the Ambassador of North Vietnam, thus openly declar-
ing his opposition to the war being conducted by the United States. While the
German Social Democrats raised budget allocations for public transportation,
education, and public housing, the Swedish government worked tirelessly to con-
solidate the myth of the Scandinavian welfare state, proposing what was unthink-
able elsewhere in Europe: Loans to furnish homes for newlywed couples, or free
vacations within national borders for children under 14 years of age. Beginning in
1970, it was the turn of the new Austrian Chancellor Bruno Kreisky to join the
European social democratic pantheon, opening his mandate with a reduction in
the duration of obligatory military service, the introduction of free textbooks in
the schools, and a progressive nationalization of the economy, which ultimately
placed some 20 percent of the manufacturing and financial sectors in public

7
A. Glyn, Capitalism Unleashed: Finance Globalization and Welfare (Oxford: Oxford University
Press, 2006), p. 17.
8
R. Aron, Plaidoyer pour l’Europe décadente (Paris: Robert Laffont, 1977), p. 12. Aron’s preface to
the original French publication does not appear in its English translation.
 The Developing Countries’ “Most Favored” Partner 125

hands. Three years later it was the Dutch Labor Party that came to power with the
government of Yoop Den Uyl, one of the most controversial and best loved politi-
cians in Dutch history, and the leader of an unusually radical coalition that viewed
the reorientation of international relations in favor of the Global South as a funda-
mental ideological principle of its own foreign policy. In 1974 the British Labour
Party returned to power in London under Harold Wilson, a hostage of its own
trade unions that sought to protect employment rates and welfare state benefits.
Italy and France, two of the founding members of the European Community,
remained nominally immune to this general leftward trend in western European
politics. In France the Gaullists managed to retain power under Georges Pompi-
dou, while in Italy the permanence in power of the Christian Democrats was guar-
anteed by a political system blocked by the presence of the most powerful
Communist party in western Europe. This does not mean, however, that neither
France nor Italy experienced profound changes in domestic politics and society.
In France, Pompidou named Jacques Chaban-Delmas Prime Minister in 1969.
Evidently modeling himself on Kennedy, the new Prime Minister launched his
“new society” program, developed with the help of Jacques Delors, an economic
theorist with a trade union background. The principal aim of the “new society”
project was to increase the competitiveness of the French economic system: The
idea, that is, that the state needed to respond to the challenges presented by a
society desiring new opportunities for consumption and by the fierce technologi-
cal and commercial competition coming from abroad. But the solutions it pro-
posed were not in fact so different from those proffered by the social democrats:
Workers’ participation in the management of business and improvements in
working conditions, opportunities for permanent education and vocational train-
ing, improvements in public transportation, and investment in public housing.9
In 1971, at the Epinay Congress, the French socialists chose a strategy of unity
and a common program with the communists. Amid the celebrations of the dele-
gates at Epinay François Mitterrand, newly named party secretary, warned that “those
who [did] not accept this break with capitalist society cannot call themselves a mem-
ber of the socialist party,” then stated his intention to increase public intervention in
the economy, calling for greater attention to socialist experiments around the world,
above all those under way in Latin America (such as the Chile of Salvador Allende).
In Italy, amid constant threats of military coup d’état, technocratic revolutions,
and seemingly permanent popular mobilization in the streets, important changes
were taking place: New bodies like the consigli di fabbrica democratized labor’s
participation in the workplace, the empowering of regional governments pro-
moted the decentralization of public administration, and new legislation was
passed to protect civil rights, such as the law on conscientious objection. These
trends did not pass unnoticed by the leadership of the ruling Christian Demo-
cratic party. By the end of 1968 party leader and former Prime Minister Aldo
Moro had proclaimed that “new times” called for a shift away from his party’s
traditional conservatism:

9
Chaban-Delmas, Mémoires pour demain, p. 435.
126 After Empires
New times are upon us and are advancing as never before. The head-spinning succes-
sion of claims for rights; the feeling that distortions, injustices, gray areas, conditions
of insufficient dignity and insufficient power are no longer bearable; the broadening
horizon of expectations and hopes of all mankind; the vision that the rights of others,
even of the most distant, should be safeguarded no less than one’s own; the fact that
young people, feeling that they live at a crucial stage in history, do not identify with
the society they live in and which they call into question: These are all signs of great
changes and of the painful labor from which a new mankind is born.10
At their eighth congress, held in 1971, the socialist parties of the European
Community supported as the primary goal of the Community that of promoting
social change, leaving economic and technical considerations on a secondary level.
Turning Rostow’s model on its head, European socialists argued that economic
growth would follow the train of social reform, and not the other way around. As
the subsequent Bonn Congress of 1973, built around the theme “For a Social Jus-
tice in Europe,” declared: “without social justice for all, European integration will
remain nothing but a castle in Spain.”11 Notwithstanding that Austria was not part
of the Community, Kreisky predicted that the battle for European political unity
would represent the third great challenge for the socialists, after having built Euro-
pean workers’ class consciousness and helped create the welfare state.12 For their
part, European Christian Democratic parties set off down the road that would lead
them in 1976 to create the European People’s Party. This new party, under its first
president Leon Tindemans, author of a 1975 report on European political union,
would attempt to make up for the weakness of the Christian Democratic parties at
the national level.13
But this changing political climate and relative weakening of nationalist ambi-
tions were not the only factors driving the European Community—which in
1968 had eliminated internal tariff barriers two years earlier than anticipated—to
seek a loosening of the Atlantic bonds.14 In 1967 the French journalist Jean-
Jacques Servan-Schreiber had published a book titled Le Défi Americain (“The
American Challenge”), which was destined to become one of the most widely
read European political essays of the 1960s. Its opening lines summarized the
thrust of his argument:
Fifteen years from now it is quite possible that the world’s third greatest industrial power,
just after the United States and Russia, will not be Europe, but American industry in

10
A point repeated at an international conference titled “Il governo delle società nel XXI secolo.
Ripensando Aldo Moro,” Accademia di Studi Storici Aldo Moro (Rome, November 17–20, 2008).
See A. Moro, “Speech to the National Council of the Christian Democrats,” November 21, 1968.
11
Devin, L’international socialiste, p. 164.
12
B. Kreisky, “Social Democracy’s Third Historical Phase,” in (1970) 5 Socialist International Infor-
mation, pp. 65–7.
13
Chenaux, “Les democrats-chrétiens au niveau de l’Union Européenne,” p. 454.
14
For a review mainly concentrating on the diplomatic transatlantic relations and emphaising the
changing patterrn of these relations in the 1970s see M. Schulz and T. A. Schwartz, The Strained Alli-
ance. US–European Relations From Nixon to Carter, New York, Cambridge University Press, 2010.
 The Developing Countries’ “Most Favored” Partner 127
Europe. Already, in the ninth year of the Common Market, this European market is basi-
cally American in organization.15
The author noted that in 1958 American businesses had concentrated one-third of
their international investment—a total of approximately US$10 million—in Europe.
But the real strength of American enterprise lay not so much in their superior finan-
cial resources, he argued, but rather in the flexibility of their internal organizational
models and in having pursued a genuine “Europeanization” of their foreign branches.
Demonstrating his European pride, the author declared his faith in the continent’s
ability to resist the American challenge of the book’s title, concluding that “Europe is
not Algeria or Senegal.” Yet Servan-Schreiber was no anti-American. On the con-
trary, he was a profound admirer of the United States and a diligent contributor to
the Bilderberg Group. As owner and editor of the French weekly newsmagazine
L’Express, which he had founded while still in his twenties, he was a prestigious and
pugnacious exponent of that European bourgeoisie that simultaneously urged for
reform while subordinating social progress to the absolute need for economic growth
rates of at least 4 percent. He was, in other words, a voice of the new European indus-
trial elite, a member of a managerial class that aimed first and foremost to reduce the
role of American multinationals in Europe but also aspired to overcome European
businesses’ inferiority in technology and organization.16
The revival of European integration in December 1969 by the Hague Summit
of heads of state and government of the EC was inspired not only by a need to
respond to the social turbulence of 1968, but also by the desire to stimulate the
European economy to create a level of prosperity that they assumed would calm
such tensions.17 The new lines of Community policy established at The Hague
were: first, the widening of the EC to include Great Britain, signaling the demise
of the European vision put forward by French Gaullist nationalists; second, the
financial regulation of the Common Agricultural Policy, providing the Commu-
nity with additional economic resources; third, the decision to pursue economic
and monetary union, with the ultimate goal of achieving the complete unification
of the European market.
Inasmuch as the strategy outlined at The Hague was still largely centered on
stimulating the European economy, EC leaders also showed signs of a willingness
to reconsider the relationship with the developing countries. The German Federal

15
J.J. Servan-Schreiber, The American Challenge (New York: Atheneum, 1968), p. 3. [Italics in
original]
16
HAEU, BAC 25/1980, n. 1827, Secrétariat-Général de la Commission, “Consultations entre la
Commission et l’administration américaine,” Brussels, April 27–28, 1972. The issue of regulation of
American multinationals in Europe was addressed in meetings between the European Commission
and the American government in April 1972. On that occasion, the Commissioner for Industry Alti-
ero Spinelli made the following requests: Assistance in the creation of “European multinationals,”
respect for European competition, and controls over arbitrary delocalization of manufacturing. On
this subject see H. Zimmermann, “Western Europe and the American Challenge: Conflict and Coop-
eration in Technology and Monetary Policy, 1965–1973,” in M. Trachtenberg (ed.), Empire and Alli-
ance (Lanham, MD: Rowman & Littlefield, 2003), pp. 127–53.
17
M.E. Guasconi, L’Europa fra continuità e cambiamento: Il vertice dell’Aia e il rilancio della costruzi-
one europea (Florence: Edizioni Polistampa, 2004).
128 After Empires

Republic seemed to be distancing itself from the rigidity of the Hallstein Doctrine
in order to embrace a new development policy less conditioned by the imperatives
of the Cold War, supported with particular vehemence by the future socialist Min-
ister for Economic Cooperation Erhard Eppler. The new German development
policy aimed to increase aid, including multilateral assistance, to the poorest
nations and in strategic sectors, rather than simply finance German exports indis-
criminately. In a small pamphlet printed in 1971, Eppler suggested the ultimate
goal was “an ambitious effort to make life for all on Earth more bearable so that it
will not become unbearable for all.”18 Albeit at the cost of some harsh exchanges
with his colleague in the Ministry for Economic Affairs, Karl Schiller, Eppler suc-
ceeded in inserting in Brandt’s government program a reference to the Pearson
Commission report discussed in Chapter Three, much to the satisfaction of the
World Bank, which believed it could count on a new ally.19
In March 1970, shortly after the conclusion of the Hague summit, the Italian
commissioner for industral policy Guido Colonna di Paliano presented a memoran-
dum that outlined the contours of a future Community strategy in the manufactur-
ing sector.20 This very ambitious plan, conceived in view of the imminent arrangements
for further European political integration and in a period of economic expansion and
high levels of industrial employment, was seen as an element in a more comprehen-
sive policy of collaboration between the trade unions and employers’ organizations.
It drew upon a strategy, sponsored with particular energy by the Italian government,
of industrial planning on a continental scale as a means of safeguarding employment
and ensuring investment in economically depressed areas.21 The Community would
join the United States at the top of the global ranks in manufacturing, while at the
same time committing itself to promoting the entry of developing countries at the
lower levels of the productive pyramid. Put together by a member of the Italian
nobility, a diplomat who had occupied high-level offices in both the OECD and
NATO, the Colonna memorandum expressed an outlook quite distinct from Ameri-
can economic concepts. It was full of dirigiste ideas, an intellectual hallmark not
restricted to the European social democrats, and stated that:
policy on the industrial development of Europe could not be conceived without due
regard being paid to the need for a more harmonious distribution of the world’s
wealth . . . In addition to the special effort it is making to assist the associated European
and African States, the Community must be ready to accept the progressive and
orderly transfer of certain industrial activities to the developing countries.22

18
E. Eppler, Not Much Time for the Third World (London: O. Wolff, 1972), p. 135.
19
WBGA, Office of the President, Records of Robert S. McNamara, General Correspondence, Box
1, “Notes on Bank–German Relations,” February 5, 1969.
20
L. Mechi and F. Petrini, “La Comunità europea nella divisione internazionale del lavoro: Le
politiche industriali, 1967–1978,” in A. Varsori (ed.), Alle origini del presente. L’Europa occidentale nella
crisi degli anni Settanta (Milan: Franco Angeli, 2007), pp. 251–85.
21
P.L. Ballini and A. Varsori (eds), L’Italia e l’Europa, vol. 2 (Rubbettino: Soveria Mannelli, 2004),
pp. 723–36.
22
Commission of the European Communities, Commission Memorandum to the Council, The
Community’s industrial policy, March 18, 1970, Bulletin of the European Communities, Supplement
4/70. Archive of European Integration (AEI). Available online at <http://aei.pitt.edu/5598/>.
 The Developing Countries’ “Most Favored” Partner 129

The idea of a new international division of labor, largely unheard-of in Washing-

ton, was also making headway in the various bodies of the European Commission.
The Mansholt Plan of 1968, named after the Dutch Agriculture Commissioner
Sicco Mansholt, was born out of the need to rein in European agricultural protec-
tionism and at the same time incentivize the modernization and increased produc-
tivity of continental farms, thus encouraging the European agricultural market to
open to the outside world.23
The reference to a more equitable international division of labor had penetrated
western Europe to the point that it had become common currency not only in the
press, but also in the deeds of labor movements. The European Confederation of
Free Trade Unions, in a document of 1970—three years before the Communist
Italian and French trade unions were admitted to form the European Trade Union
Confederation (ETUC), in 1973—put forward a strategic action plan for develop-
ment of the countries of the South.24 The text, evidence of the unions’ self-assur-
ance fresh from their recent victories and in an age of full employment, demanded
of the Community governments:
that from today, and using in particular the resources of the European Social Fund,
structural reforms and reorganization in the industrialized countries be undertaken, in
such a way as to allow the creation and development of manufacturing in the develop-
ing countries, while avoiding making the workers of the industrialized countries the
victims of the necessary transformations.
On the other side of the Atlantic, the obsession was with the growing American
balance of payments deficit, which in 1971—for the first time since 1883—was
accompanied by a parallel deficit in the balance of trade. Washington was in debt
to the rest of the world, and at the same time importing greater quantities of goods
than it could export. The creation in 1969 of a new reserve currency in the IMF,
the Special Drawing Rights (SDRs), was not sufficient to halt the dollar hemor-
rhage. The issue of the dollar’s convertibility into gold, long stabilized at $35 per
troy ounce, and the role of America’s currency as the pivot of international mone-
tary system, were thus definitively called into question.
This serious state of affairs pushed members of Congress and the Republican
administration to reinvigorate the ongoing debate over the reduction of the Ameri-
can military presence in Europe, and to criticize those elements of the Commu-
nity’s economic policy that openly conflicted with American interests. Such was
the case with the CAP, which protected the European market from imports of
American corn and grain, and especially with the European system of preferences
for the markets of certain African nations that gave European goods an advantage

23
G. Thiemeyer, “The Mansholt Plan, the Definite Financing of the Common Agricultural Policy
and the Enlargement of the Community, 1969–1973,” in J. van der Harst (ed.), Beyond the Customs
Union: The European Union’s Quest for Deepening, Widening and Completion 1969–1975 (Brussels:
Nomos Bruylant, 2007), pp. 197–223.
24
IISH, ETUC, Box 3007, CESL, “La CE et les Pays en voie de dévéloppement,” October 20,
1970.
130 After Empires

over those produced by their American and Latin American competitors—a large
number of which were US multinationals.25 As early as 1969, Senator Jacob Javits
of New York, an influential member of the Senate Foreign Relations Committee,
spoke of the Common Market as an entity “that is ever more openly assuming the
contours of a small and introverted protectionist bloc.”26 US labor leaders pushed
insistently for protectionist measures to safeguard American manufacturing indus-
tries and employment rates, and for cuts in the foreign aid that they believed—
wrongly—had contributed to a reduction of domestic employment. At the same
time they called for tighter controls over the activities of multinationals, in particu-
lar over the delocalization of production.27 Deflation to defend dollar convertibil-
ity was not really an option, in a country where Keynesian mindset was still
dominant and where between 1970 and 1973 unemployment was 5.4 percent
compared to 0.9 percent in Germany, 2.1 percent in France and 1.3 percent in
Japan.28
At the outset of Nixon’s first term Henry Kissinger, then National Security Advi-
sor, wrote an important memorandum expressing his belief that, with Europe’s
stabilization, America’s priority should be to concentrate on relations with the
Soviet Union and, in an ever more fragmented and anarchic world, to deepen its
dialogues with other regional powers.29 One result of this new approach, beyond
Nixon’s pathbreaking trip to China in February 1972, was that one of the most
significant economic decisions of the century—the abandonment of the Bretton
Woods monetary system—was taken without any consultation with America’s
European allies, and with the deliberate intent of making them pay for its conse-
quences in full. Within the State Department there was broad recognition of Euro-
pean concerns at the growing protectionism demonstrated by the United States,
the anarchic behavior of American multinationals, and the exodus of short-term
capital, and many in Foggy Bottom hoped to orchestrate a concerted economic
initiative between Europe, the United States, and Japan. Instead, those who wished
to see Washington make a unilateral decision to demonstrate its autonomy and
reassert its leadership of the Western world had their way.30 On August 15, 1971
the Republican administration announced the suspension of the dollar’s converti-
bility into gold, and the imposition of a 10 percent surcharge on all imports not
subject to established quotas. It then communicated the fait accompli to the major

25
L. Coppolaro, “The United States and the EEC Enlargement (1969–1973): Reaffirming the
Atlantic Framework,” in van der Harst (ed.), Beyond the Customs Union, pp. 135–63.
26
UNOG, UNCTAD, ARR 40, 2344, B.48, Letter, Jacob J. Javits to Perez-Guerrero, November
12, 1969.
27
WBGA, Records of Robert S. McNamara, Memo to McNamara, “Your Conversation with
George Meany,” July 14, 1971.
28
J. Stein, Pivotal Decade. How the United States Traded Factories for Finance in the Seventies, (New
Haven, CT: Yale University Press, 2010), p. 45.
29
FRUS, 1969–1976, vol. I, 41, Memorandum from the President’s Assistant for National Secu-
rity Affairs (Kissinger) to President Nixon, “Analysis of changes in international politics since World
War II and their implications for US foreign policy,” October 20, 1969.
30
FRUS, 1969–1976, vol. III, 56, Paper prepared in the Department of State, “International Eco-
nomic Strategy for the 1970s,” Washington, DC, March 16, 1971.
 The Developing Countries’ “Most Favored” Partner 131

European capitals with a brief telegram.31 Following these steps the administration
decided upon a dollar devaluation, approved by the Smithsonian agreement of
December 17–18, 1971, which caused the value of the ample dollar reserves accu-
mulated by the European central banks to tumble rapidly.
The unilateral American decision to alter the international monetary system
contributed in no small measure to a growing distance in the relationship between
the United States and western Europe, a distance that was also brought out into
the open by the debate over the creation of a Generalized System of Preferences in
favor of the developing countries.
The resolution on such preferences approved at New Delhi in 1968 began to be
discussed as a result of the European Community’s activism and America’s strategy
which aimed to force the Six to abandon their policy of special preferences, if not
to cancel outright the inverse preferences from which the Community continued
to benefit as a result of the Yaoundé Convention. The first general preference
scheme laid out by the Community had been discussed in back channels at the
OECD meeting of March 1969, shortly before the Hague European Summit. This
was clearly the product of a series of deals between the individual Community
nations, and trod cautiously around the reservations of important industries within
each of the Six; it might almost be considered a cut-rate compromise. But, consid-
ering that it entailed concessions without providing corresponding benefits, the
end result was still of some note, and of even greater significance if one keeps in
mind the general hostility of European industries toward any reform that made it
easier to import manufactured goods from the Third World.32
The proposal was further reduced as the deadline approached for presentation of
the Community scheme, particularly as it affected processed agricultural goods,33
a type of product on which the developing countries had hoped to receive broad
concessions. Great Britain, which was still negotiating its entry into the Commu-
nity, could do no more than resign itself to going along with the plans of the Six.34

31
FRUS, 1969–1976, vol. III, 169, Telegram from the Department of State to the Embassy in Ger-
many, August 16, 1971. On the decision-making process that led to the end of the dollar’s convertibility
and the strategy of the American administration see D. Basosi, Il governo del dollaro. Interdipendenza
economica e potere statunitense negli anni di Richard Nixon (1969–1973) (Firenze: Polistampa, 2006).
32
Agence Europe, February 18, 1969. In a communiqué of 18 February the Federation of Belgian
Enterprises melodramatically summarized the situation: “conceding a customs exemption for the
products named, as proposed by the Commission, is equivalent to putting up for discussion the very
existence of certain sectors of our own industries.” If it was impossible to avoid some form of prefer-
ences system, it was essential to calibrate preferences on a country-by-country and sector-by-sector
basis. HAEU, EM 155, Union des Industries de la Communauté Européenne (UNICE), “Octroi
Eventual de preferences tarifaires pour les produits manufactures et semi manufactures des pays en
voie de développement,” January 24, 1968.
33
HAEU, EM 155, Dg1, Note à l’attention de Monsieur Martino, “Préférences tarifaires en faveur
des pays en voie de développement,” February 27, 1969. The system originally proposed by the Com-
mission foresaw a concession of preferences on sixty-seven different types of processed agricultural
product, for a total sum of some US$80 million (in 1967 values). The system adopted, after varied
modifications, included fifty-four products, for a total value of US$19 million.
34
NA, FCO 69/154, Speaking Note, “Generalised Preferences”: “The only logical option is that of
adapting our offer to the system of generalized preferences proposed by the Community, to which we
will have to adapt in any case after our admission to the EEC.”
132 After Empires

Furthermore, the EC had no intention of giving up the system of inverse prefer-

ences it had established with the Association of the African States.
At the GATT ministerial meeting held on May 25, 1971, all the contracting
parties, including both developing and developed countries, approved a waiver to
be applied to Article 1 of the GATT statute in order to enact a system of prefer-
ences toward the developing world. Almost all the GATT representatives from the
Southern countries considered the decision an historic moment: An inversion of
the past tendency to base trade policy on the presumption of equality between all
parties.35 Shortly afterward, on July 1, 1971, the Community enacted its own
Generalized system of preferences.36
Generalized preferences went some way to counterbalancing a trend that saw
the relative weight of the developing countries in trade with the nations of the
Community steadily decreasing after the colonial era, with the notable exception
of course of oil-producing states such as Libya, Algeria, or Venezuela.37
It would take another three years, in contrast, for the United States to approve
provisions for their own scheme of preferences, facing intense pressures in the
interim from countless entreaties by the countries of the South, before the decisive
push of the first oil crisis of 1973. Even then, the Trade Act, passed by Congress in
1974, carried with it a seemingly limitless series of conditions: One excluded all
states that had undertaken nationalization projects without paying an indemnity
to American enterprises; the Jackson–Vanik amendment excluded from trade con-
cessions all socialist countries that failed to respect established norms regarding
emigration; yet another excluded all nations that guaranteed inverse preferences to
developed countries. All these clauses made the American system of preferences a
very sharp-edged instrument of soft power, rather than a tool for the industrial
development of the Global South.

S A N T I A G O , C H I L E : T H E R A D I C A L I Z AT I O N
O F T H E T H I R D WO R L D

With the adoption of generalized preferences a victory had been achieved on the
trade in manufactures front. While it is always wise to approach economic statistics
with extreme caution, particularly those for the Third World, it is safe to argue that
the period from 1950 to 1975 was one of positive growth in the countries of the
South. In the course of these twenty-five years the GDP of the developing coun-
tries had grown by 3.91 percent, while that of the developed nations had risen by

35
NA, FCO 69/261, GATT Council, “Minutes of the Meeting Held on May 25, 1971,” May 28,
1971.
36
T. Kuroda, “Instauration du Système de preferences généralisées de la Communauté européenne,
1968–1971,” in (2011/12) 34 Bulletin de l’Insitut Pierre Renouvin, pp. 137–48. In total, European trade
preferences involved goods valued at a sum of approximately US$7 billion in 1980, seven times the
value of 1971. Likewise, there was a notable growth in processed agricultural products admitted to the
system of preferences: From a total of US$30 million in 1971 to some US$500 million in 1980.
37
H. Perroy, Europa e Terzo mondo, p. 323.
 The Developing Countries’ “Most Favored” Partner 133

3.2 percent.38 Beginning in the 1970s, however, distinctions began to emerge with
ever-greater clarity among the group of developing nations.39 In Latin America, for
example, while Brazil boasted tremendous if unevenly distributed growth between
1950 and 1973, Chile grew at a minuscule annual rate of 1 percent, and Argentina
grew no faster than 2 percent per year. As Jeffrey Frieden has noted, such meager
rates during a period in which the world economy as a whole witnessed a boom
carried significant consequences. For example, in terms of per capita income, if
Argentina had grown at the same rate as Brazil from 1950–73, that is at 4 percent
per year, in 1973 it would have been as wealthy a nation as France; similarly, if
Chile had grown at the 5 percent annual rate experienced by South Korea, by 1973
it would have equaled the Federal Republic of Germany. At the same time, nations
like South Korea or Taiwan, which had managed to find a niche as exporters of
cheap manufactures, could claim extraordinary success: India, which in 1950
occupied their same level, was to become three times poorer than South Korea by
1973, and four times poorer than Taiwan.
But such trade could only benefit some, while the majority of countries in the
South continued to be penalized by the low raw materials prices and the accumu-
lation of onerous international debt burdens. Furthermore, beginning in 1971
the volatility of exchange rates and declining value of the dollar made incomes on
raw materials ever—more uncertain, since their prices were fixed in American
currency.
While the contentious rise of Third World internationalism in the 1960s had
produced apparently meager practical results, by the end of the decade the alliance
among the diverse regimes in developing countries, having renounced the global
social revolution advanced by leaders such as Che Guevara, appeared to have the
winds of change blowing in its direction. The Tehran Conference on human rights
in 1968 was to be a surprising success for the modernizing, authoritarian Shah of
Iran, Mohammed Reza Pahlavi. His message—that collective rights and economic
development had to be considered a more important priority than Western con-
ceptions of individual rights—was upheld by the vast majority of the conference’s
participants. As Roland Burke has reflected on this under-studied topic:
Tehran was the culmination of a shift from the Western-inflected concept of individ-
ual human rights exemplified in the 1948 Universal Declaration to a model that
emphasized economic development and the collective rights of the nation. The pro-
ceedings of the conference demonstrate with remarkable clarity the altered balance of
forces in the UN following decolonization and the decisive role played by the non-
Western states.40

38
As the Nobel Prize-winning economist Dani Rodrik observed, between 1960 and 1975 more
than fifty countries grew at annual rates exceeding 3 percent. Rodrik also noted that—contrary to
common assumptions—the economy that grew most rapidly in this period was not that of South
Korea or Singapore, but that of Gabon in West Africa: see D. Rodrik, “Globalization, Social Conflict
and Economic Growth,” UNCTAD, 8th Raúl Prebisch Lecture, October 24, 1997.
39
Frieden, Global Capitalism, pp. 354–5.
40
R. Burke, “From Individual Rights to National Development: The First UN Conference on
Human Rights, Tehran, 1968,” in (2008) 19(3) Journal of World History, pp. 275–96.
134 After Empires

The 1970s had opened with the United Nations’ declaration, in October 1970, of
the Second Development Decade.41 Its stated objectives were even more ambitious
than those announced ten years previously: “The Developing Countries should
reach, in the second Decade, an average annual rate of growth of at least 6 percent
of GDP and 3.5 percent of GDP per capita, in current values, against the approxi-
mately 5.1 percent and 2.5 percent respectively reached in the course of the years
1960–1968.”42 The means to reach such ambitious targets were not clearly identi-
fied, however, and included the standard, less than persuasive recommendations of
the need to loosen conditions on development loans—possibly with the elimina-
tion of tied aid—and calls to stabilize commodity prices, as well as a request to
increase public development aid to 0.7 percent of GDP.
Developments in three important areas of North–South relations characterized
the period between the second UNCTAD at New Delhi and the third, which
would be held in Santiago, Chile from April 13 to May 19, 1972. What had begun
as a diplomatic conference, in which the countries of the South assumed largely
reformist positions and attempted to rein in those taking a more openly aggressive
stance, began to evolve into a more open confrontation over the rules of the inter-
national economy. This shift in the international climate, already perceptible in the
atmosphere of the third conference of the Non-Aligned Movement in 1970 at
Lusaka, Zambia, cannot be fully understood without reference to the changes born
in 1968, not only in Europe but also within the Third World itself.43
First, the United States had become the primary target of the developing coun-
tries’ criticisms. Second, there was a shift in what the G77 emphasized, from purely
trade matters (for instance regarding generalized preferences) to those concerning
international law—such as legislation on coastal areas, controls over multination-
als, and international labor standards—or the issue of participation in the most
important decisions affecting the international economy, such as the reform of the
international monetary system. Third, and in parallel with the admission of Cuba
to the G77, there had been a growing bond between the Non-Aligned Movement,
which up to then had concerned itself primarily with political issues, and the G77,
more deeply involved with economic questions. This process of politicizating the
G77, however, did not go forward without revealing a small crack in the South’s
united front, created by the divergence of interests among certain Latin American
countries, which desired radical changes in international regulation, the African
states, which hoped to obtain measures in favor of the poorest of the developing
nations—that is, themselves—and the Asian nations, which continued to be pri-
marily concerned with trade agreements to make their exports more competitive.

41
S. Banchi, “Intergovernmental confrontation in the UN framework: How many ‘Europes’!,” in
M. Affinito, G. Migani, and C. Wenkel (eds), Les Deux Europes/The Two Europes (Brussels: Peter Lang,
2009).
42
HAEU, CM–1333, Letter from J. Rey, President of the European Commission, to P. Harmel,
President of the Council of the European Community, “Nota della Commissione al Consiglio sul
Secondo Decennio della Nazioni Unite per lo Sviluppo,” May 12, 1970.
43
An explicit reference to the importance of 1968 can be found in the memoirs of one of the
General Secretaries of UNCTAD, Rubens Ricupero: see Beyond Conventional Wisdom in Development
Policy. An Intellectual History of UNCTAD (1964–2004) (Geneva: United Nations, 2004), p. 9.
 The Developing Countries’ “Most Favored” Partner 135

In November 1971 the new Secretary-General of UNCTAD (and former Ven-

ezuelan oil minister) Manuel Perez-Guerrero paid a visit to Washington alongside
economic advisor Sidney Dell to express the widespread disillusionment within
the G77 with American unilateralism in monetary policy, and to voice their wishes
to have a role in IMF debates over future reforms to Bretton Woods.44 He further
insisted on the need to conclude several commodities agreements immediately,
beginning with a controversial agreement on cocoa, which had undergone a long
slide in value. To these requests representatives of the Republican administration,
seemingly on an entirely different wavelength, responded that for Washington the
key to growth remained the improvement of the climate for private investment in
the developing world, in particular in Latin America.
The Indian Trade Minister, returning in 1971 from the second G77 ministerial
conference in Lima, Peru—following that at Algiers in 1967—had also expressed
bitter criticisms of the United States: First, of the temporary surcharge imposed on
imports; second, of the failure to introduce a generalized system of preferences;
third, for having unilaterally decided a matter of such importance for the world
economy as the convertibility of the dollar. In so doing, he gave an implicitly posi-
tive judgment of the actions of the EC, the countries of eastern Europe, and Japan
for having put in place their own systems of preferences.45
If the developing world’s anger seemed to be increasingly directed at the United
States, this did not mean that the feeling was uniform or unanimous among all its
members. At the G77 ministerial meeting in Lima a distinction had seemed to
emerge between a moderate bloc and more radical countries, like the host nation
Peru or Chile. The more radical front voiced deep hostility to foreign investment,
the activities of multinational corporations, and both bilateral and multilateral aid.
They declared their intention to organize an international conference for the
reform of Bretton Woods, demanded new regulations that would allow the nation-
alization of strategic industries, and hoped to foster an open debate over the role of
UNCTAD toward other international economic organizations. The moderates, in
contrast, put forward lower-profile requests for further trade liberalization and an
increase in development aid.46
The product of the effort to reconcile these internal tensions within the G77
nations was the Lima Charter, signed on November 7, 1971.47 The Lima Charter
placed a spotlight on the danger of the potential bankruptcy faced by developing
countries, citing a debt burden projected to reach a total of US$60 billion by the
end of the 1970s and argued that in order to correct this trend, the Southern coun-
tries would first have to make difficult choices regarding their own industrializa-
tion and deep internal structural reforms. One such important choice, taken before

44
NARA, CPF, FT3, Box 1020, Report, “Perez-Guerrero Visit,” November 19, 1971.
45
NARA, CPF, FT3, Box 1021, Telegram Embassy New Delhi, “UNCTAD III: Recent GOI
Statement on Some Issues,” December 13, 1971.
46
NARA, CPF, FT3, Box 1020, Intelligence Note, “UNCTAD III: Group of 77 surfaces differing
attitudes among regional groups,” November 15, 1971.
47
HAEU, BAC 25/1980, n. 303 “Déclaration et principes du program d’action de Lima, adoptés
par le Groupe des 77 à la Deuxième Réunion Ministérielle,” November 7, 1971.
136 After Empires

Lima, had been the inclusion of Cuba in the Group, a decision made by the Peru-
vian government against the express wishes of a number of participating
countries.
The North–South debate would then carry over from the G77 conference in
Lima to the third UNCTAD conference in Santiago. Earlier, in 1970, Kissinger
had demonstrated in a memorandum to President Nixon the concern,he felt at the
potentially dangerous repercussions of the so-called “Chilean Path to Socialism”:
The example of a successful elected Marxist government in Chile would surely have an
impact on—and even precedent value for—other parts of the world, especially in
Italy; the imitative spread of similar phenomena elsewhere would in turn significantly
affect the world balance and our own position in it.48
But whatever efforts it might make, American diplomacy could not prevent
Allende’s Chile from hosting such a major international meeting:49 a factor that
would contribute to Washington’s hostility to UNCTAD in particular, and the
United Nations in general, a forum in which the United States began to find itself
consistently in the minority.50
Allende had been elected president of Chile in 1970 and was a proponent of a
socialism rooted in constitutional processes and parliamentary politics.51 Such poli-
tics implied the acquisition, by either the state or workers’ cooperatives, of a number
of underperforming economic sectors: From the copper mining industry, to the
great agricultural latifundias, to financial institutions.52 Allende’s socialist experi-
ment drew great international attention—he had the support of the great Chilean
poet Pablo Neruda and the open sympathy of Fidel Castro, among others—in large
part because it represented a potential third way to industrial development in the
Third World: An alternative to both the Brazilian or Iranian models, based on an
authoritarian government allied with international capital, hostile to any redistribu-
tive measures, and that of Peru, similarly based on a military junta but in open
opposition to international capital and bent on a form of wealth redistribution
through state intervention.53 The “democratic socialism” embodied by Allende
showed the promise of a new paradigm for all of Latin America: A democratically
elected government, attempting to free itself from the guidance of foreign financial

48
Cited in A. Santoni, Il PCI e i giorni del Cile. Alle origini di un mito politico (Rome: Carocci,
2008), p. 92. Also cited in P. Kornbluh (ed.), Nixon on Chile Intervention, National Security Archive
Electronic Briefing Book No. 110 (February 2004). Available online at <http://www.gwu.
edu/~nsarchiv/NSAEBB/NSAEBB110/index.htm#doc2>.
49
NARA, CPF, FT3, Box 1019, Department of State, “UNCTAD. Decision to hold UNCTAD
III in Santiago: US Position,” March 20, 1970.
50
HAEU, BAC 25/1980, n. 303, Délegation de la Commission à Washington, “Préparation de la
prochaine conference de la CNUCED par les Autorités américaines.” March 13, 1971.
51
J. Haslam, The Nixon Administration and the Death of Allende’s Chile: A Case of Assisted Suicide
(New York: W.W. Norton & Co., 2005).
52
A. Cuevas, “Salvador Allende,” in A. Cuevas (ed.), America Latina. Uomini e idee, vol. 2 (Rome:
Edizioni Lavoro, 1995), p. 324.
53
A. Touraine, Vie et mort du Chili populaire: Juillet/Septembre 1973 (Paris: Editions du Seuil,
1973), p. 15.
 The Developing Countries’ “Most Favored” Partner 137

markets and to redistribute resources more equitably among its population with the
help of self-managing cooperatives.
The Chilean president immediately began by nationalizing the holdings of
American multinationals that monopolized the production of copper, Chile’s most
vital strategic resource, but one that was some 80 percent under foreign control.
The goal behind the nationalization of the mining industry was to exploit the
income from the export of raw materials to finance imports of heavy machinery, in
order to support the future development of Chilean industry.54 The United States
government was not unaware that American multinationals were pocketing huge
profits from their investments in the strategic resources of Latin American coun-
tries; however, it justified these profits—a return on investment of up to 10 percent
per year—as just remuneration for the risks incurred by foreign entrepreneurs, and
argued that local governments were incapable of managing the natural resources of
their own lands with the same efficiency and “know how.”55 Allende’s international
strategy, in cooperation with the other more radical Southern countries, was to
combat this view by establishing new international standards on foreign invest-
ment that would guarantee local governments’ autonomy to manage their own
natural resources, allowing them to condemn and outlaw foreign intervention or
political pressures regarding nationalization.
The other prongs of Allende’s international economic strategy included the
untying of international aid, which often created the paradox that wealthy donor
nations found themselves even richer after the granting of assistance than they had
been before;56 agreements on prices for raw materials that would allow producer
nations to raise their value; and consensus on the need for international coopera-
tion to reform the international monetary system. For Allende these concepts were
not the product of intellectual analysis born in opposition, but rather a practical
effort to overcome the economic stranglehold that confronted a small nation of the
Global South. Chile imported almost all its domestic necessities. Representatives
of the Chilean government, receiving a delegation from the Italian Communist

54
A. Mulas, Allende e Berlinguer: Il Cile dell’Unidad Popular e il compromesso storico italiano (Lecce:
Manni, 2005), p. 54.
55
NARA, CPF, FT3, Box 960, Letter from Ambassador Korry to Chilean Minister of Foreign
Relations, March 26, 1969. The American Ambassador to Chile Edward Korry, contesting the validity
of the figures cited by the Chilean government, argued that, while from 1960 to 1966 private invest-
ment in Latin America totaled some US$2.75 billion, the return on investment amounted to “only”
some $8.39 billion.
56
FRUS, 1969–1976, vol. IV, Letter From Acting Secretary of State Elliot Richardson to Secretary
of the Treasury David M. Kennedy, June 9, 1969. The same Secretary of State Richardson, before
being replaced, complained to Treasury Secretary Kennedy about the fact that the system of American
aid to Latin America generated a surplus of US$300 million. In certain cases, like that of Colombia,
the clauses attached to the loans compelled the debtor nation to conduct more than 40 percent of its
trade with the United States. In other situations, like that of Chile, such clauses imposed the conces-
sion of reverse preferences on American products: “I understand we have argued vehemently that
reverse preferences are bad and they should be eliminated entirely from the Common Market/African
Yaoundé Convention,” Richardson noted. And yet: “In order to improve our balance of payments
situation and avoid the replacement of possible direct American exports by our aid shipments, we have
instituted an elaborate program of negotiated ‘additionality’ agreements which result in a small gross
gain to the balance of payments. At what cost?”
138 After Empires

Party,57 explained that there were only two ways that a Latin American country
undertaking a program of reform could accumulate sufficient capital resources to
finance its imports. The first was to obtain greater profits from the export of its
own raw materials, something that would not be possible if commodity prices were
to drop on the international market. The second was to obtain wider access to
international credit. But on January 2, 1972 the United States had officially
declared that no country that had nationalized the property of American citizens
could obtain government loans. At the same time the credit granted to Chile from
all the international financial agencies, from the World Bank to the Inter-American
Development Bank, suffered a drastic reduction: From US$237 million to US$27
million.58 Such events help to explain Allende’s insistence on agreements to safe-
guard commodity prices, on new standards to regulate international loans, and on
international participation over the future of the American dollar, the currency of
reference for payments on virtually all raw materials.
Allende’s strategy was presented in a more strident tone on December 4, 1972—
after the conclusion of UNCTAD III in Santiago, to be discussed shortly—in his
remarks before the General Assembly of the United Nations.59 Allende noted that
in the two years since the declaration of the Second UN Development Decade the
situation facing the South had become, if anything, even worse: The industrialized
countries had decreased aid from an average of 0.34 percent of GDP to 0.24 per-
cent; the international debt of the Southern countries had grown in two years from
US$70 billion to US$75 billion; and Western investment in Latin America had
produced an exodus of capital between 1960 and 1970 on the order of US$9 bil-
lion. To reverse this state of affairs, Allende asked that the international economic
system be changed to allow greater solidarity among the countries of the South,
including in the form of regional economic accords.
57
Fondazione Istituto Gramsci (FIG), Archivio Partito Comunista (APC), Fondo Esteri, Anno
1972, vol. V, “Relazione del compagno Secchia sul viaggio in Cile per il 50mo anniversario del Par-
tito,” January 17, 1972. Pietro Secchia, one of the party’s eminences grises, had engaged in discussions
with the head of the Chilean Communist Party Corvolan and with the Soviet Foreign Minister Volo-
dia, and had come away with the following notes:
– In the course of 1971 some 1,300 latifundias were redistributed, and in 1972 the others are set
to undergo redistribution;
– nationalization of the copper mines;
– nationalization of the carbon mines and of a large ironworks, two of the three largest cement
producers, and fifty percent of the private banks;
– sixty percent of Chile’s industrial production is today in the hands of the State. In certain cases
this is the product of expropriation, in others the assumption of control by the government and
the acquisition of shares whose price had collapsed;
– growth in salaries slightly higher than projected adjustments for the cost of living.
The problem, added the two Chilean representatives, was that Chile must import everything, from
meat to raw materials, and could count neither on foreign aid, nor on a rise in the price of the goods
it exported. The price of copper, which was at $0.67, had dropped to $0.45. As a result the govern-
ment decided to bet everything on growth in production as well as the common struggle of commodi-
ties producers.
58
Mulas, Allende e Berlinguer, p. 65.
59
United Nations, General Assembly, Official Records, Speech by Salvador Allende, President of Chile,
to the twenty-seventh session of the General Assembly of the United Nations, December 4, 1972.
 The Developing Countries’ “Most Favored” Partner 139

Securing the meeting of UNCTAD III in Santiago had been a victory for the
Chilean Ambassador Hernán Santa Cruz, an able navigator of the complicated
dynamics of UN negotiations. His deft assurances notwithstanding, setting up a
conference capable of hosting an organization of some 2,600 delegates, coming
from 140 nations, for an entire month would be an enormous undertaking for a
small country in the grip of a severe economic crisis. The most important element
of the project, ordered by Allende himself, was the construction of a new confer-
ence hall, for which approximately US$9 million had been appropriated. As of
January 1972, little more than two months from the conference’s opening, work
was still far behind schedule. At the end of the month the Chilean president went
in person to the construction site and spoke directly to the 1,100 workers there,
reminding them that Chile was being watched by the entire world and explaining
just how urgent the success of UNCTAD was for the nation’s future.60 He asked
them to volunteer to work even over the weekends in numbers greater than the 35
percent established by contract, and added that he would return unannounced to
check on their progress and to see just how many laborers were volunteering to
work in their free time.
The United States hardly prepared for the Santiago conference. The American
delegation, which unlike their European counterparts did not include anyone of
ministerial rank, was instructed to maintain “a generally forthcoming but low key
approach.”61 American attentions in international economic relations were directed
elsewhere, principally toward their primary goal of restoring a trade surplus through
a careful manipulation of the dollar. For its part the Soviet Union, which did not
boast a very positive record on development aid, did not appreciate being placed
by the G77 on the same plane as the imperialist powers, and did not hold much
faith in multilateral economic negotiations as a tool to help the Southern countries
escape the vicious cycle of underdevelopment.62 Among the great powers, only
China expressed support for the negotiating positions of the Southern nations; the
Chinese were actively courting Latin America by granting more aid than Moscow
to the Allende government. At the UNCTAD in Santiago, China also positioned
itself in favor of new international legislation that would expand the range of
territorial waters, as requested by Peru, railing against the conduct of Western
multinationals and against the trade and agricultural policies of the United States
and the European Community in general.63 But the Chinese delegation still
had not realized the full import and direction of the UNCTAD negotiations,
and effectively outlined a policy that tended toward autarky and self-isolation:

60
“Showcase Lags, Allende Frets,” in Washington Post, January 27, 1972.
61
FRUS, 1969–1976, vol. IV, Memorandum from the Chairman of the CIEP (Samuels) to the
President’s Assistant for International Economic Negotiations (Flanigan), “CIEP Study Memoran-
dum 16 UNCTAD III,” March 3, 1972.
62
NA, FCO 59/794, Draft for “trends,” “Communist Economic Aid before UNCTAD III,” Janu-
ary 20, 1972. In 1970 the Soviet Union had distributed less aid than it had in 1964: US$1 billion,
down from US$1.3 billion. Soviet aid, moreover, was densely concentrated in specific areas; more than
50 percent went to two countries: Egypt and India. The rest went almost entirely to another six coun-
tries: Turkey, Syria, Iran, Afghanistan, Pakistan, and Algeria.
63
For an interpretation of Chinese foreign policy in this regard, see Fejtö, Chine–Urss, p. 441.
140 After Empires

Objectives that were not very appetizing to countries that were dependent on for-
eign commerce, and that possessed much smaller and more restricted domestic
markets than China’s vast territorial ocean of men and materials.64
Even if the two superpowers were not deeply engaged in the negotiations at
Santiago, this does not mean that the conference did not produce meaningful
results. The judgment of diplomatic historians like Jean-Baptiste Duroselle has
been wholly negative, and seems to treat the Santiago conference as the final
engagement in the battle between North and South before the conflicts that
emerged over the oil question definitively ruptured the South’s united front.65 The
Santiago meeting might instead be considered as the beginning of a process of
growing combativeness in the developing world and a new, albeit brief, phase
marked by a surprising degree of internal cohesion.
The Santiago conference forced both North and South to confront new issues
that would supplant more traditional debates over trade preferences and develop-
ment aid. The conference approved the creation of a commission guided by the
Mexican president Luis Echeverria, for instance, that was charged with drafting a
“Charter of the Economic Rights and Duties of States” and that, among other
things, would definitively establish the legal rights to nationalization. The partici-
pants at Santiago also reiterated their general reticence toward foreign investment
by multinationals and the industrialized world, as well as multilateral aid, and
demonstrated a tendency to widen the role of the state in the economy, even among
the non-socialist countries. Moreover, UNCTAD III determined that the coun-
tries of the South would participate in the reform of the international monetary
system, and that a “Committee for the Reform of the International Economic
Order,” the Committee of Twenty—which included several developing countries—
would be the primary forum for future monetary negotiations.66 Even if the Com-
mittee of Twenty, effectively created in July 1972, was not able to produce a
definitive reform of Bretton Woods in its two years of activity, it nevertheless con-
tributed to a push to increase the weight of the developing countries within the
IMF, and successfully placed the issue of increasing the flow of credit toward the
developing world on the international agenda. In the same way, a resolution
approved at Santiago pledged the GATT nations to involve the G77 and the Sec-
retary-General of UNCTAD in the multilateral negotiations scheduled to begin in
1973 and that would become known as the Tokyo Round.

64
NARA, CPF, FT3, Box 1023, Intelligence Note, “The Communist Countries at the UNCTAD
III,” June 14, 1972. The report of the American specialists noted that China had failed in its efforts to
position itself as the leader of the developing countries, and that it had not even succeeded in joining
the G77.
65
J.B. Duroselle and A. Kaspi, Histoire des relations internationales de 1945 à nos jours (Paris:
Armand Colin, 2004).
66
FRUS, 1969–1976, vol. III, Volker Group Paper, “Minutes of the discussion in London con-
cerning the procedures for preparing monetary reform (April 23, 1972),” Washington, May 10, 1972.
The practical procedures for the creation of the G20 were discussed within the group led by the
Under-Secretary of the US Treasury Paul Volker. The goal of the G20 was to return to a system of
“fixed but adjustable” exchange. But in June 1974, after the first oil crisis, the group was forced to
admit it was impossible to find common ground on a system of fixed exchange and concluded its
labors.
 The Developing Countries’ “Most Favored” Partner 141

One unforeseen element to emerge from Santiago was the attention, and in
some cases direct intervention, of interest groups, religious orders, student move-
ments, and various associations in many of the issues up for debate, including on
some highly technical matters—attention that gave the diplomats involved the
sense of being watched by international public opinion.67 We have already seen
how the Dutch government had prepared its negotiating position in collaboration
with trade unions and student groups. But even in a country with a traditionally
opaque bureaucracy like Italy, long-time diplomats lamented the influence exerted
by pressure groups on the inner workings of the Foreign Ministry. They demanded
that the foreign service regain “that capacity and those functions which, either de
jure or de facto, had been taken away from it, especially after 1968, by cooperatives,
associations, parties, and unions.”68 Initiatives like the Tobin Tax (named after the
noted economist), put forward in 1972 and supported by scattered intellectuals
and nongovernmental organizations, were designed to levy a tax on international
capital speculation. On the European level in particular, it had become clear that
it would be impossible to avoid directly involving citizens in the potential risks and
damage that would result from an international revolution that was inherent in the
existing trade imbalances between rich and poor nations. Likewise, it was under-
stood that it would be wiser to explicitly encourage European consumers to choose
goods produced in the Third World, rather than continue to express their sympa-
thy through sporadic, isolated gestures of charity.69

S I C C O M A N S H O LT

While the logistical planning for UNCTAD III proceeded apace, the countries of
the European Community developed their negotiating positions.
Italy found itself in an unusually high-profile position during the period from
the Hague Conference to the UNCTAD meeting at Santiago, which it handled
with an uncommon vigor.70 In 1970 the Christian Democrat Franco Maria Mal-
fatti had been named President of the European Commission, joined in Brussels
by another Italian in the office of Commissioner for Industry, Altiero Spinelli, a
well-known proponent of European federalism. Until 1974, save for a brief inter-
ruption, the Italian Foreign Ministry was headed by the former prime minister
Aldo Moro. In a meeting with Malfatti in 1970, Moro had stated his conviction
that Europe needed to strengthen its relationship with Latin America, a long-held
objective of Italian diplomacy that appeared to gain new traction with the enlarge-

67
UNOG, UNCTAD, ARR 1830, b15a, Written for the World Development Movement by John
Greenway and Chris Pipe in conjunction with Chris Stockwell (who represented the WDM in San-
tiago), “End of an Illusion. Verdict on UNCTAD III,” July 1972.
68
R. Gaja, L’Italia nel mondo bipolare. Per una storia della politica estera italiana (Bologna: Il Mulino,
1995), p. 25.
69
HAEU, EM 153, Ocipe, “Rapport du colloque de Wissen, Problèmes posés par l’évolution
globale du commerce entre la Cee et la Pvd.”
70
A. Varsori, La Cenerentola di Europa. L’Italia e l’integrazione europea dal 1947 ad oggi (Soveria
Mannelli: Rubbettino, 2010).
142 After Empires

ment of the European Community. If undertaken, however, such a strategy would

have implied the creation of new frictions in relations with Washington. In a letter
to Allende, the Italian Communist MP Renato Sandri explained that the ties bind-
ing Europe and the United States were loosening, as the states of western Europe
began to perceive the need for greater autonomy, not least of all in the technologi-
cal field.71 Moro himself appeared convinced that the challenges created by détente,
not to mention the social tensions within the EC nations, highlighted the need to
reposition Europe as a “civilian power”:
This unifying action, both economic and political, of most of western Europe was
born from a grand design: Replacing with fertile cooperation those suspicions and
rivalries between peoples of the region—factors which had led to two world wars.
. . . Such a work can give the peoples of Europe the chance to let themselves be heard
more effectively. Can such rediscovered influence be harmful to anyone? The answer
is: No. It is not directed—and will never be directed—against any people, but against
war, against the burden of weaponry, hunger and underdevelopment, against iniquity,
against all that which can hinder free and productive contacts among all men.72
The Italian government was subject to multiple and often countervailing pressures
in the run up to the Santiago conference. It was engaged in a war against an inter-
nal “strategy of tension” marked by sporadic acts of domestic terrorism, and preoc-
cupied by the constant flight of capital that illustrated the Italian bourgeoisie’s
alarming lack of faith in the stability of its democratic institutions. Almost inevita-
bly this led to clashes within the government, on the limits of the potential conces-
sions Italy could make to the industrializing countries without endangering the
country’s own low-tech industries. The socialist Commerce Minister Mario Zagari
considered the Third World the second most important competitor to Europe, just
behind the United States, and criticized multinationals and neocapitalism, sparing
no words in his criticism of an Italian policy of development cooperation overly
focused, in his estimation, on improving trade balances.73 During the third

71
FIG, APC 1970, Esteri, Fascicolo 218, Renato Sandri al Signor Presidente della Repubblica del
Cile, Santiago, November 2, 1970: “From 1955 to 1958 North American investments in the EEC
countries grew by 68 percent, while the growth in American investments throughout the developing
world amounted to a total of only 88 percent . . . The United States is concentrating on conquering
European industry and finance. The branches of the American multinationals operating in Europe
control 95 percent of semiconductors, 80 percent of all electronics, 40 percent of titanium oxides,
[and] 30 percent of the automotive sector.”
72
Aldo Moro, Speech at the Twenty-Sixth Session of the General Assembly of the UN, New York,
October 6, 1971.
73
M. Zagari, Superare le sfide. La risposta dell’Italia e dell’Europa alle sfide mondiali (Milan: Rizzoli,
2006), p. 119. Regarding multinationals, Zagari writes:
The inadequacy of the capitalist approach based on profit and private enterprise speaks for itself,
in the phenomenon—as atavistic as it is alarming—of multinational corporations for whom the
Third World has become either a base camp or a place of refuge. It is clear that, with this emi-
nently modern phenomenon, neo-capitalism tends to produce anything but the promotion of
the economic development and social health of the less developed countries, seeking instead to
profit from their lower labor standards and overabundance of unskilled workers; with the result
that it impedes any real improvement in the state of either their disadvantaged classes or their
organizational structures.
 The Developing Countries’ “Most Favored” Partner 143

UNCTAD, the question which most closely united Italy with the countries of the
South was that of international monetary reform, mainly through the request for
a link between the creation of Special Drawing Rights and development aid, a
proposal previously advanced in 1967 by the Italian Treasury Minister Emilio
Colombo.
Immediately after the conclusion of the conference in Chile, members of the
Institute for Relations between Italy and Africa, Latin America, and the Middle
East (IPALMO)74—established in 1971 to bring together trade union leaders,
politicians, and scholars of different political backgrounds with an interest in
development issues and UNCTAD—gathered in Rome. Its director Giampaolo
Calchi Novati evaluated the Italian government’s position at Santiago on interna-
tional monetary reform, delivering strong criticism of its inability to offer effec-
tive opposition to the demands of more politically active Southern states like
Chile or Algeria. Renato Sandri, in charge of cooperation for the PCI, supported
the government’s position on preferences and SDRs, but criticized its defense of
European agricultural interests, indicating the priorities of an Italian Commu-
nism thoroughly in line with the predominant positions of the Scandinavian
social democracies:
1. Support for the French proposal, opposed by the Federal Republic of Ger-
many as well as the United States, to create global mechanisms to regulate
raw materials;
2. Broadening of the generalized system of non-reciprocal preferences adopted
by the EC, in such a way that it could tip trade balances in favor of the Third
World;
3. Revision of the EC–AASM agreements from Yaoundé, created under a
framework of colonial heritage and French neocolonialism;
4. Revision of the Common Agricultural Policy, which would have to center
largely on reform of its structures rather than on the price controls;
5. Adoption by Europe of the socialist countries’ aid concession scheme.
Among the Six, the country whose position most closely approximated an open
partnership with the Southern countries was the Netherlands. Shortly after the
Santiago conference a national election would result in a change in the Dutch
parliamentary majority, bringing to power a new coalition of Labour and extremely
progressive Christian Democrats. Yoop Den Uyl was named Prime Minister and
Jan Pronk—who had long collaborated with Jan Tinbergen on questions of devel-
opment—was named Minister for Development Cooperation. But even before the
change in government, development issues drew heavy pressure from a wide range
of public opinion, from student movements to religious groups. In January 1972
the government had organized a symposium in preparation for Santiago, calling
on politicians and well-known policy experts on development. The invited repre-

74
FIG, APC, Estero, Anno 1972, vol. VIII, Tavola rotonda Ipalmo, “La terza sessione dell’UNCTAD
a Santiago del Cile.”
144 After Empires

sentatives of the French government would later complain that, in an atmosphere

conditioned by the presence of young “socialists and radicals,” a platform was
approved that largely conflicted with French policy goals.75 The final document
indicated four objectives that western Europe should aim to achieve at Santiago:
1. that each member State should spend at least 0.7 percent of GDP in deve-
lopment aid;
2. that the creation of international liquidity—SDRs—should be tied to deve-
lopment assistance;
3. that the protectionist policies of the Community regarding agricultural
products and its system of special preferences be amended;
4. that it should move forward on international agreements on a product-by-
product basis.
These instructions were not very different from those that the current Dutch Min-
ister for Development Cooperation Kees Boertien would support, with greater
diplomatic finesse, in his remarks at the plenary assembly at Santiago. Boertien
reminded the other ministers that:
public opinion in several developed countries is gradually becoming informed about
the biggest problems that the developing countries have encountered on their path to
development. Political parties, churches, and student movements today all have a pas-
sionate interest in cooperation between developed countries and developing countries.
This is especially true in my country.76
The openness of the Dutch position compared to that of the other nations of the
Community led The Hague’s supporters to believe that, in conjunction with the
governments of Nordic socialist and other progressive nations—Sweden and Can-
ada, in particular—they might form a new motor for international cooperation,
especially within multilateral organizations like the World Bank.77
The French government also placed great importance on the meeting in San-
tiago, and decided to employ as spokesman the Finance Minister Valéry Giscard
d’Estaing, one of the most distinguished voices on the French political stage. The
line that he would follow did not differ much in substance from that previously
maintained by de Gaulle, aimed above all at defending the interests of the Associa-
tion of the African States—which required reassurance in light of the widening of
the European Community—and forging a new rapport with the British Com-
monwealth. French diplomats had begun to reach out to the AASM at the start of
the new year, in a ministerial meeting in which Giscard explained to his African
colleagues France’s strategy to combat the chaos of currency revaluations that

75
AMAEF, NUOI, Carton 1332, Ambassade de France aux Pays-Bas, “Note sur le Symposium
préparatoire à la Troisième CNUCED qui s’est tenu à La Haye les 19, 20, et 21 janvier 1972.”
76
HAEU, FMM 38, Statement by Mr. C. Boertien, Minister in charge of Development coopera-
tion of the Kingdom of the Netherlands, “UNCTAD,” May 15, 1972.
77
WBGA, Office of the President, Records of Robert S. McNamara, General Correspondence, Box
1, Memorandum, “Meeting in McNamara’s Office,” November 4, 1963.
 The Developing Countries’ “Most Favored” Partner 145

threatened to destabilize the finances of the poorest nations.78 The French govern-
ment, he explained, hoped to negotiate a devaluation of the dollar in order to
return to a system of fixed exchange. The head of the French Treasury further
reminded his hosts of the economic figures behind the relationship of the Com-
munity with the Association of the African States, which showed them to be run-
ning deficits in terms of goods and services while maintaining a surplus in capital
transfers. Such figures clearly showed the African states’ complete dependence on
European aid and the marginality of their foreign trade. It should thus come as no
surprise that the AASM nations had promised to fight at UNCTAD III to intro-
duce and promote economic relief for the poorest of the developing countries.
During the Santiago conference, Giscard dutifully revived the strategy of indi-
vidual commodity agreements, an instrument that promised to be able to guaran-
tee stable profits for raw materials by freeing them from the vagaries of the market.79
He radically opposed, however, the requests of those nations—among them cer-
tain developed nations, but above all the Latin American countries—that sought
the wider opening of European markets. Broader access to European markets for
agricultural produce from more temperate zones such as grain or milk, the French
argued, would favor first and foremost other industrialized nations like the United
States. On the other hand, even if the Community supported the import of tropi-
cal African products, such measures alone were insufficient, as the African states
were among the poorest nations on earth, and especially because canceling the
already low tariffs on tropical goods would not produce any increase in their con-
sumption on the continent.
Great Britain had even less freedom of action than they had possessed at
UNCTAD II in New Delhi in 1968. British diplomacy appeared to be completely
subordinated to the decisions of the Community nations, which were preparing to
decide on London’s entry into the group. The pessimistic attitude of the analysts in
the British Foreign Office left no room for novel proposals. While the relationship
with the South was considered a potential card to play, either with the European
Commission or with the Foreign Ministries of the Six, and could even be seen as
the kernel of a future common European foreign policy, the English appeared to
be well aware of their own marginal position.80 Great Britain had tried to respond
to its difficulties on the aid front—along with the United States, it was the only
country not to accept the target of 0.7 percent of GDP—by announcing at the last
minute in Santiago a minor effort in that area, and especially by pledging to present
new proposals to improve the quality of European aid at the upcoming European
summit in Paris.81

78
AMAEF, NUOI, Carton 1332, Réunion des ministres des Finances Africains, Malgache et
Français, “Compte rendu analytique de la reunion des 21 et 22 février, 1972 à Fort-Lamy.”
79
AMAEF, NUOI, Carton 1333, Nations Unies, “Note pour le Cabinet,” March 16, 1972.
80
NA, FCO 59/794, UK Delegation to the EEC, “UNCTAD III,” January 17, 1972.
81
NA, FCO 59/795, Note to the Prime Minister, “Debt Burden to Developing Countries,” April
27, 1972: “We are seen, both at the international level and here at home, as brakemen, and I believe our
prestige within UNCTAD and at the fall EEC summit would be markedly increased if we were to suc-
ceed in approving a higher level of public aid, without necessarily supporting the 0.7 percent target.”
146 After Empires

In its approach to the third UNCTAD, the European Community was forced to
reconcile these diverse positions and the specific role of the European Commission.
If it successfully managed at the last minute to take a defined position, and if the
relationship with the developing countries became one of the important topics at
the summit of European heads of state and government held at Paris in October
1972, this was because of the personal activism of one man: The new president of
the European Commission, the Dutch socialist Sicco Mansholt, who succeeded
Malfatti in April 1972 and remained in charge for only a little over seven months.
For the European Community 1970 had been full of positive signs for the dec-
ade to come. In December 1969 the Hague Summit had concluded with the his-
toric decisions to confirm British admission and to take the first steps toward
economic and monetary union. In 1970 the “transition period” came to a close
with the inauguration of the Malfatti Commission, which would be empowered to
represent the Community, the largest trade bloc in the world, in all international
trade agreements with third party nations. The institutions in Brussels were buzz-
ing with lively debates and new ideas, but also clouded by a certain confusion due
to the obvious need to adjust its norms and structures to a new role worthy of the
Community’s economic strength. The period immediately following 1970 has
been described by Michel Dumoulin as one of the Commission’s greatest periods
of intense creativity, pregnant with possibilities for innovation.82
Among the most obvious problems facing the European Commission was that
of the Community’s representation in international economic negotiations. While
it was true that, under Article 113 of the Treaty of Rome, the Commission was the
only body allowed to represent the Community in trade negotiations, one ques-
tion remained unanswered: What was the appropriate procedure in those talks
where questions of trade, other questions of Community interest, and still other
questions of an exclusively national character were all discussed at the same time?
Such mixed forums were many, including the United Nations FAO, the OECD,
the World Bank, and UNCTAD itself. It was very quickly understood that finding
a uniform solution would be impossible, and it that would be best to decide the
question of the Community’s representation on a case-by-case basis.83 Thus began
a battle that continues to this day, to find some form of common European repre-
sentation in all international economic institutions (with the notable exception of
GATT, where such representation had of course been already decided).
The same European Commission began to reorganize its own internal struc-
tures, including the slow but steady passage of responsibility for relations with the
Global South from the Commissioner for External Relations to the Commissioner
for Development Cooperation. Definitively completed by the negotiations at

82
M. Dumoulin (ed.), The European Commission 1958–72: History and Memories (Brussels: Euro-
pean Commission, 2007), p. 197.
83
HAEU, EM 153, Service Juridique de al Commission des Communautés Européennes, Note
pour la DGI, “Relations extérieures de la Communauté Economique Européenne. Conséquences de
la fin de la période de transition,” December 15, 1969. The Community’s Legal Services branch
revealed the inefficacy of the law on matters of a political nature: “The solution that would seem to be
most satisfying, in the current state of the Community’s evolution, is a mixed delegation.”
 The Developing Countries’ “Most Favored” Partner 147

Lomé,84 this process indicated French wishes (the Directorate-General for Devel-
opment was by tradition a French prerogative) to retain control over relations with
the developing world after enlargement, and thus to safeguard the priority the
French placed on their traditional link with the AASM.
The communication presented by the Commission to the European Council in
March 1972 was very cautious, because of the desire to avoid committing the
Six—which group by 1973 would become the Nine—to further financial commit-
ments, and the need to defend the CAP, but also because of the contradiction
between their duty to maintain the special relationship with the African states and
their desire to make overtures to the rest of the Southern countries.85 The most
important novelty in the communiqué lay in the recognition of the financial needs
of the developing countries: A condition that it would not be possible to change
simply with more aid. According to the calculations in the Pearson Report, devel-
oping countries would need a total of some US$28 billion in aid by 1975, a figure
that would imply an increase in public development aid of some 4.4 percent for
just the Community alone. The Commission acknowledged that such a prospect
was entirely unrealistic, reiterating the Community’s usual line of defense that it
was the greatest importer of goods from the poorest countries while avoiding
putting undue emphasis on the fact that the majority of such imports came from
energy-producing nations. The Commission instead proposed to the Council that
the Community pledge to finance a series of studies to promote the formation of
regional markets throughout the South on the model of the Community itself,
with the idea of fostering a virtuous circle of exports among the Southern countries
themselves. But the Community also came under fierce pressure—from Continen-
tal textile industries, for example86—to avoid further extension of the generalized
system of preferences, and from farming interests to avoid concessions to the Third
World on agricultural policy.87
Within the European Parliament the climate was more favorable to increasing
the Community’s commitments toward the South. The parliamentary report on
UNCTAD II presented by Pedini in 1968 had concluded by asking for an original
doctrine on which the Six could agree, liberating them from their usual bartering.
Four years later, in the discussions leading up to Santiago,88 Fellarmier (speaking
on behalf of the socialists) called for a quantum leap in the direction of a global

84
HAEU, EM 158, Nota, “La necessaria salvaguardia della politica estera nei confronti dei paesi
terzi in via di sviluppo”: “A strong trend in favor of reinforcement of the development aid sector (DG
VIII, development policy directly primarily towards Africa) is making itself felt through the addition
of a ‘Mediterranean policy’ and a ‘general multilateral policy toward the developing countries’ (prima-
rily UNCTAD and the generalized preference schemes for semi-manufactures and manufactures of
the developing countries), competencies currently attributed to the DGI.”
85
Commissione europea, Comunicazione della Commissione al Consiglio, “Preparazione della 3º
Conferenza delle Nazioni Unite per il commercio e lo sviluppo,” March 8, 1973.
86
HAEU, BAC 25/1980, n. 303, Comitextil, Lettre à M. J.F. Deniau, Membre de la Commission
des C.E., April 14, 1972.
87
HAEU, BAC 25/1980, n. 303, COPA, “Déclaration du Praesidium du Copa en ce qui concerne
la troisième CNUCED,” April 14, 1972.
88
European Parliament, Debates, sitting of Tuesday March 14, 1972.
148 After Empires

politics of development cooperation and supported the idea that the introduction
of SDRs as a new reserve currency alongside the dollar should be tied to develop-
ment aid. From the same socialist parliamentary group the Dutch minister Engi-
warda pointed out that Sir Maxwell Stamp in 1953—the spiritual father of
SDRs—Robert Triffin, and more recently the Nobel laureate Jan Tinbergen had all
supported the linkage between SDRs and development aid. But there was wide-
spread skepticism among Commission staff at the idea of international financial
reform in favor of the South.
The Council of Ministers, delivering its directive regarding the Santiago confer-
ence, had expressed the cautious view that the Community could play no specific
role in Chile, other than to offer generic support for an agreement on individual
commodity agreements. The choice to assume more forthcoming positions would
have to depend upon individual member states.89 The official justification was that,
in light of its imminent enlargement, the Community could not take any decisions
that would complicate or endanger British admission.
Predictions of an uninspired Community “performance” at UNCTAD would
have been realized if not for the nomination, in April 1972 and precisely in con-
nection with the beginning of discussions in Santiago, of Sicco Mansholt as Presi-
dent of the European Commission. The selection of Mansholt revealed a surprising
softening of the attitude of Pompidou’s France toward Europe. Mansholt was in
fact loathed by the Gaullists for his proposals to reform the Common Agricultural
Policy, and for his overt sympathies for European federalism. As Altiero Spinelli
wrote in his diary, “the choice of Mansholt is an excellent one. It is characteristic of
a new wind that is beginning to blow through Paris.”90 With a personality as sin-
gular as it was authoritative, Mansholt was not known in Brussels for his diplo-
matic skills, and had been among the few members of the college in the Berlaymont
Palace to openly criticize de Gaulle. The son of farmers in the northernmost Dutch
province of Gröningen, he was well versed in socialist ideas—a rarity in the con-
servative and rather closed Dutch agricultural milieu. Mansholt had taken part in
the Dutch resistance against the Nazis during the Second World War and lived for
a period in the Dutch East Indies as the manager of a tea-producing business:
A hands-on experience with agricultural labor that he would always draw upon in
his political career, first at national level and subsequently in the bureaucracy in
Brussels. In the postwar years he was one of the youngest members of the Dutch
cabinet, serving as Agriculture Minister until 1958 before being nominated the
first Agricultural Commissioner of the European Commission.91 Mansholt did
not hold strong theoretical convictions with regard to markets and agricultural
production, but rather by the beginning of the 1970s he began to regard the
question of development in the South as the primary issue on which to focus the

89
Central Archive of the Council of the European Union (CEU), Note, “Préparation de la 3ème
Session de la Conférence des Nations Unies sur le Commerce et le Développement,” March 24,
1972.
90
A. Spinelli, Diario europeo 1970–1976 (Bologna: Il Mulino, 1991), p. 286.
91
For a complete biography of Mansholt, see J. Van Merriënboer, Mansholt. A Biography. Brussels:
PIE Peter Lang, 2011.
 The Developing Countries’ “Most Favored” Partner 149

Community’s efforts, and to which all other common policies should be subordi-
nated. The evolution of his thinking certainly echoed the wider cultural shifts
brought about by 1968; indeed, he often cited both Marcuse and Illich without
apology as intellectual reference points. At the same time, he was the first to voice
the idea, widely shared within the closed circles of the Commission itself, of the
need to search for a new driving mission to animate a recently enlarged Europe.92
Mansholt was greatly influenced by the Limits of Growth report and began a
personal intellectual revolution driven by the idea that a “second Marx” was needed
in order to find new solutions for the crisis of capitalism. In a private letter to
Malfatti, the Dutch commissioner had outlined his plan for what might today be
called the “degrowth of the European economy.”93 He understood that there would
not be enough natural resources to support the survival and rising living standards
of a world population that within a short period of time was expected to grow from
3 to 7 billion persons. The industrialized world would have to adjust its own way
of life, ceasing to venerate the false idol of GDP in favor of growth in what he
called Gross National Utility. “Don’t fall in love with a given rate of growth,” went
the oft-repeated slogan in university halls of the time. Applying the concept of
Gross National Utility carried several implications: In the developed world, cut-
ting excess consumption, financing the production of consumer durables and
energy-efficient appliances, and investing heavily in education and public services—
that is, “planning abundance”; in the underdeveloped world, meanwhile, it sug-
gested widening the use of technologically modern appliances to make daily life
easier and improve life expectancy—that is, “planning scarcity.” The end result of
this process, which would be impossible to realize without introducing a massive
dose of planning into the economy, would entail a substantial redirection of net
resources to the Global South.
Mansholt’s letter received press coverage because it was leaked to the media as an
example of the wicked machinations of the technocrats in Brussels by the French
communist leader George Marchais, in his campaign against British entry to the
Community. Within the very same Commission there were many, from the Com-
missioner for Economic Affairs Raymond Barre to the Commissioner for Industry
Spinelli, who thought Mansholt’s arguments were too radical. They reiterated the
importance of the economic relationship among the developed countries, and
placed their faith in technology as a means of solving the problems tied to the dis-
tribution of energy resources as well as those of pollution and the environment.94 As
Spinelli recorded in his diary: “Together with Barre and with Dahrendorf I helped

92
HAEU, FMM 40, Commission, “Premières considerations de base relatives à un memorandum
sur la politique extérieure de la Communauté,” January 31, 1972. The Commission’s adviser wrote
that “[t]he principal struggle that animates an ever-greater number of people at the end of the twenti-
eth century is the struggle against poverty. This is one of the few uncontested ideals of a vexing and
quarrelsome cohort of youth that will take the reins of power in the next generation.”
93
European Navigator (now Centre Virtuel de la Connaissance sur l’Europe), RTL (Film), Qui est
Mansholt? Quel est son plan?, April 8, 1972. Available online at < http://www.cvce.eu/web/ws/search/-/
search?searchQuery=Qui+est+Mansholt%3F>.
94
J. van der Harst, “Sicco Mansholt: Courage and Conviction,” in Dumoulin (ed.), The European
Commission, p. 186.
150 After Empires

give the proper shape to that part which concerns international relations. Mansholt
would have talked only of the Developing Countries. We responded that if there is
a trade war between the developed countries, then everything will fall apart. In the
end Mansholt conceded the point.”95 Both sides would soon be forced to rethink
their positions, but in the meantime their stance showed just how deeply in 1972
faith remained rooted in the panacea of technological progress.
With a brief warning to the staff of the External Relations Directorate-General,
which had put forth a more tentative position than his own, the President of the
Commission arrived in Santiago for the first time in mid-April.96 Later, after hav-
ing convened representatives of the Six on the spur of the moment,97 Mansholt
decided to return to Chile on 15 May with the aim of pushing forward the stalled
UNCTAD negotiations, but especially with the goal of showing the Community
in a different light. If the Community had been criticized particularly for its special
relationship with the AASM, and the reciprocity of tariff concessions that this
entailed,98 Mansholt proposed instead to turn the EC into the major interlocutor
of the Global South.99 His first step was to organize a series of meetings with the
heads of the delegations of the Community nations and the Secretary-General of
UNCTAD, as well as the representatives of the Andean Pact, the AASM, and the
Association of South-East Asian Nations (ASEAN), in order to give them a forum
to voice their concerns with respect to the Community. India and Brazil, in par-
ticular, feared that British entry would mean a hike in English tariffs to align them
with those of the other Community Member States. They requested that in the
upcoming GATT negotiations, scheduled to begin in 1973 without the participa-
tion of some fifty-nine developing countries, attention might be turned to the
preferential lowering of tariffs with the Southern nations, rather than the elimina-
tion of barriers to trade among developed states. Finally, they also asked to partici-
pate in monetary talks and urged the need for concrete action on commodities.
Having listened to their concerns, Mansholt, despite not having much room for
maneuver, sought to stretch the Council’s directive to its limits. He guaranteed
that generalized preferences would be more generous in the future, and that the
Community would dedicate itself to working to allow the developing countries to
participate in any future trade negotiations. Furthermore, he let it be understood
that if the Community was not able to deliver more at UNCTAD, this was because

95
Spinelli, Diario europeo, p. 316.
96
AMAEF, NUOI, Carton 1333, Télégramme, “CNUCED,” April 17, 1972. It should be noted
that Mansholt referred in his remarks more often to the resolution of the European Parliament on the
conference, which he later circulated among the delegates, than to the directives of the European
Council.
97
AMAEF, NUOI, Carton 1333, Télégramme Bruxelles, “Voyage à Santiago du Chili de M. Man-
sholt,” May 15, 1972.
98
HAEU, BAC 25/1980, n. 298, Commission, Délégation pour l’Amérique Latine, “Préparation
III CNUCED. Commentaires au sujet de thèmes traits dans une communication de la Commission
au Conseil,” March 9, 1972.
99
HAEU, FMM 38, Compte rendu de la visite du Président Mansholt à Santiago du Chili et à
Lima. Visite à Santiago, May 16, 17, 18 and 19, 1972, May 23, 1972; “La fogue de M. Mansholt,”
Journal d’Europe, May 16, 1972.
 The Developing Countries’ “Most Favored” Partner 151

it was fully engaged in preparations for the October Paris summit: An occasion
which he hoped to use to announce a global effort on behalf of the developing
countries. Mansholt’s report on the trip to Chile concluded with the statement
that the Community was “at the center of the developing countries’ hopes and
fears,” and that excessive attention to the African states was perceived by the South-
ern nations as an effort to divide them. Urgent adjustments were needed.
Participation at UNCTAD reinforced Mansholt’s convictions of the need to shift
the attention of the Community from its relationship with the United States to those
with the South. The tensions produced by this stance were amply demonstrated in a
meeting in Brussels with Peter Flanigan, President Nixon’s handpicked Assistant for
International Economic Affairs, shortly after Mansholt’s return from Chile.100
Flanigan opened the meeting by stating that, with the improvement in East–
West relations—referring to the Strategic Arms Limitation Treaty (SALT I) that
introduced limits to the superpowers’ strategic nuclear weapons arsenal—the time
had come to fortify the Atlantic Pact. Mansholt replied that, to European public
opinion, the primary problem was now the North–South divide rather than the
Cold War, and that in this area America’s attitude was deeply discouraging. Flani-
gan later reported that when he sought to engage the President of the Commission
on the need to resolve the contentious trade negotiations that were poisoning the
relationship between the Community and Washington, Mansholt replied:
[The] EC will begin to develop commercial and industrial policies which will look to
the interests of the LDCs. The problems Europe has with the US are not important.
The “Eberle negotiations” earlier this year were a big mistake for Europe. It was “silly”
to have spent so much time and political capital on a few million dollars’ worth of
trade in citrus fruit, tobacco, etc., when 20 percent of the world was starving.
He assured me that he was not the least concerned with soyabeans, (“to hell with
your soyabeans”) . . .
Flanigan seemed scandalized by the affirmation that in the upcoming GATT nego-
tiations tariff reductions between developed countries would not be considered as
important as the focus on tariff reductions toward the South. Mansholt retorted by
admonishing the United States for their ever-more-limited efforts in terms of aid
and added that, at the Paris summit on Community relations, European leaders
would concentrate on the Third World, “implying that relations with the US
would be decidedly secondary.”
The meeting became even more tense when Nixon’s representative made it clear
that Washington could not permit any increase in development aid because the
United States was constrained by massive military expenditures to support its com-
mitments around the world, including for the defense of western Europe. Man-
sholt acknowledged that the issue of European military spending was a real one,
but replied that, as a socialist, he did not believe the Vietnam War was resolving all

100
FRUS, 1969–1976, vol. III, Report by the President’s Assistant for International Economic
Affairs (Flanigan), “Report of visit to Western Europe May 30–June 10, 1972, Attachment 2, Conver-
sation with EC Commission President Sicco Mansholt,” Brussels, June 1, 1972.
152 After Empires

of humanity’s problems, and added fuel to the fire by accusing the American gov-
ernment of having cut off multilateral aid funding to Chile. Wrapping up the
meeting, he restated his belief in the unavoidable need to tax the developed nations
to redistribute resources to the South, and affirmed that it would be necessary to
reconvert both European industrial and agricultural policy, even at the cost of swift
adjustments to the Western way of life. It should come as no surprise that Man-
sholt did not win himself any sympathy in Washington.

REGIONALISTS AND GLOBALISTS

After the 1973 enlargement, the European Community would include some 256
million citizens, compared to 207 million in the United States and 245 million in
the Soviet Union, and would reassert its prominence in global commerce, con-
ducting some 22.6 percent of world trade.
It would emerge as an economic giant, whose decisions would inevitably have
an impact on economies throughout the rest of the world. It thus faced the prob-
lem of balancing its development and cooperation policies, which up to that point
had had a primarily regional focus, with a global outlook that would respond to
the increasingly insistent demands of the Southern countries as well as the pres-
sures stemming from European public opinion.
The Community of the Six had signed association agreements with Greece and Tur-
key in 1962 and 1964, respectively, that were supposed to lead to the two nations’
eventual adhesion. Among the countries of western Europe, Spain and Austria were also
negotiating similar association agreements. In 1963 the Six had also, as we have already
seen, signed the Yaoundé Convention with the francophone Association of the African
States. In 1969 Yaoundé II had widened the AASM to include an additional three coun-
tries in East Africa. Turning to the Mediterranean, in September 1969 association agree-
ments were reached with Tunisia and Morocco, while negotiations were ongoing with
Israel, Egypt, and Lebanon to sign memoranda of understanding that would guarantee
these nations preferences for particular goods on the European market.
That was not all. In 1969 the Community had applied specific preferential duties
to citrus fruits from Israel and Spain, a decision that did not fail to provoke immedi-
ate and vociferous protests from the Latin American countries.101 With the excep-
tion of the agreements on citrus products, all of these various deals—some of which
anticipated customs unification, others simply the lowering of tariff barriers—had
been negotiated under GATT Article XXV, which allowed for exemptions to the
“most favored nation” clause wherever the countries involved had established free

101
HAEU, EM 205, Conseil, Note d’Information, “Examen dans le cadre du GATT de la demande
présentée par la Communauté vivant à obtenir une derogation au titre de l’Article XXV en ce qui
concerne l’application de preferences tarifaires pour les agrumes originaires de l’Espagne et d’Israël,”
September 19, 1969. The South American countries stated their objections to the Community’s deci-
sion thus: “Our delegations have observed that the decision taken by the Community seems to con-
tradict both the stance it has often demonstrated toward the developing countries within UNCTAD,
and the declarations of good will it has repeatedly submitted to the countries of Latin America.”
 The Developing Countries’ “Most Favored” Partner 153
THE EUROPEAN COMMUNITY AND ITS AGREEMENTS WITH DEVELOPING COUNTRIES
(1957–1975)

Original member states of the EC (West Germany, France, Italy, Netherlands, Belgium, Luxembourg)

Member states joining the EC in 1973 (United Kingdom, Ireland, Denmark)

Countries signing Yaoundé I and II (Burundi, Cameroon, Central African Republic, Chad,
Congo-Brazzaville, Congo-Leopoldville, Dahomey, Gabon, Ivory Coast, Madagascar, Mali, Mauritania,
Niger, Rwanda, Senegal, Somalia, Togo, Upper Volta)

Countries signing the Arusha agreement with the EC in 1969 (Kenya, Tanzania, Uganda)

Countries joining the EC-ACP Lomé I Convention in 1975 (Botswana,

Equatorial Guinea, Ethiopia, Gabon, Gambia, Ghana, Guinea, Guinea Bissau, Kenya, Lesotho, Liberia,
Malawi, Nigeria, Sierra Leone, Sudan, Swaziland, Tanzania, Zambia; Bahamas, Barbados, Grenada, Guyana,
Jamaica, Trinidad and Tobago; Fiji, Tonga, Western Samoa)

Mediterranean countries signing Association Agreements with the EC in the 1960s and 1970s
(Greece 1961, Turkey 1963, Cyprus 1972, Spain 1973, Malta 1977)
Mediterranean countries signing Cooperation Agreements with the EC in the 1970s (Algeria 1976,
Morocco 1976, Tunisia 1976, Egypt 1977, Lebanon 1977, Jordan 1977, Syria 1977, Israel 1977)

Figure 4.1. The European Community and its Agreements with Developing Countries
(1957–1977)

trade areas or customs unions. Save for the accords with the AASM, however, none
of the agreements that the Community had reached or was in the course of negoti-
ating truly fulfilled this principle, since the proposed future free trade areas or cus-
toms unions in question had never been definitively established, nor were even
scheduled to come into being according to a set timeline.
Until the end of the 1970s no action had been taken under GATT against the
European Community. But the multitude of agreements that the EC was conclud-
ing throughout the Mediterranean began to raise eyebrows in the United States,
among the countries of Latin America, and even in many Asian nations. From an
economic point of view these countries feared discrimination against their own
exports; but even stronger were the fears, already clearly outlined by Raúl Prebisch,
that the world could end up being divided into large regional trade blocs: The two
Americas, Euro-Africa, and Asia.
 154
Table 4.1. Trends in World Trade
EXPORTS
Year Main countries in 2006 sorted on the basis of their total trade (exports + imports)
World 1 EU 2 United China Japan Canada Hong South Mexico Singapore Russia 3 India Switzerland 4
States Kong Korea

Value (Bn ECU/Euro)(*)

1958 64.2 15.3 17.8 ! 2.8 5.3 0.1 0.0 0.7 ! ! 1.2 1.5
1960 78.5 19.2 20.5 ! 3.9 5.8 0.7 0.0 0.8 0.2 0.1 1.3 1.9
1970 200.8 44.8 43.2 ! 18.9 16.7 2.5 0.8 1.3 1.6 ! 2.0 5.2
1982 1,757.7 286.0 211.1 22.3 135.8 69.2 20.5 21.0 21.4 20.5 37.5 8.4 26.5

After Empires
1983 1,876.6 302.6 219.2 24.8 158.5 82.4 23.7 26.2 24.6 23.6 40.7 8.8 28.6
1984 2,256.3 350.8 268.6 31.4 206.2 110.1 34.5 35.6 30.0 29.5 51.3 10.4 32.6
1985 2,369.5 380.3 272.0 35.8 224.4 113.7 38.3 38.0 28.4 28.7 57.8 10.8 35.8
1986 1,916.0 341.9 214.6 31.8 205.8 87.2 34.7 34.1 16.1 21.9 43.7 9.2 37.9

Share (%)

1958 100.0 23.9 27.8 ! 4.3 8.2 0.2 0.0 1.1 ! ! 1.9 2.4
1960 100.0 24.5 26.1 ! 5.0 7.4 0.8 0.0 1.0 0.2 0.2 1.7 2.4
1970 100.0 22.3 21.5 ! 9.4 8.3 1.2 0.4 0.7 0.8 ! 1.0 2.6
1982 100.0 16.3 12.0 1.3 7.7 3.9 1.2 1.2 1.2 1.2 2.1 0.5 1.5
1983 100.0 16.1 11.7 1.3 8.4 4.4 1.3 1.4 1.3 1.3 2.2 0.5 1.5
1984 100.0 15.5 11.9 1.4 9.1 4.9 1.5 1.6 1.3 1.3 2.3 0.5 1.4
1985 100.0 16.1 11.5 1.5 9.5 4.8 1.6 1.6 1.2 1.2 2.4 0.5 1.5
1986 100.0 17.8 11.2 1.7 10.7 4.6 1.8 1.8 0.8 1.1 2.3 0.5 2.0
1987 100.0 17.8 11.2 1.8 10.0 4.3 2.1 2.1 0.9 1.2 2.1 0.5 2.1
 IMPORTS
Year Main countries in 2006 sorted on the basis of their total trade (exports + imports)
World 1 EU 2 United China Japan Canada Hong South Mexico Singapore Russia 3 India Switzerland 4
States Kong Korea

Value (Bn ECU/Euro)(*)

1958 68.6 15.7 14.5 ! 2.8 5.4 0.5 0.4 1.0 ! ! 1.8 1.7
1960 82.1 19.3 16.2 ! 4.2 5.9 1.0 0.3 1.1 0.4 0.2 2.2 2.2

The Developing Countries’ “Most Favored” Partner

1970 210.9 45.6 42.7 ! 18.8 13.8 2.9 2.0 2.1 2.5 ! 2.1 6.5
1982 1,887.4 321.6 250.3 18.9 131.8 55.2 22.1 23.3 13.4 28.0 45.4 15.9 29.2
1983 1,990.0 329.6 289.4 23.5 139.1 68.1 24.9 27.7 8.2 30.7 48.6 15.5 32.7
1984 2,393.8 381.9 411.8 32.2 168.4 91.9 33.2 36.2 12.0 34.9 58.2 19.1 37.3
1985 2,518.8 399.5 450.4 54.3 166.5 98.6 35.2 37.6 17.0 33.1 70.9 21.2 40.1
1986 2,012.5 334.6 371.7 43.0 124.9 80.7 32.7 30.0 11.5 24.7 52.9 15.2 41.6
1987 1,960.7 340.1 344.3 36.9 124.4 74.4 38.1 32.9 10.9 26.8 46.7 14.5 43.6

Share (%)
1958 100.0 22.8 21.1 ! 4.2 7.9 0.8 0.5 1.5 ! ! 2.6 2.5
1960 100.0 23.5 19.7 ! 5.1 7.2 1.3 0.3 1.3 0.5 0.2 2.7 2.7
1970 100.0 21.6 20.2 ! 8.9 6.5 1.4 0.9 1.0 1.2 ! 1.0 3.1
1982 100.0 17.0 13.3 1.0 7.0 2.9 1.2 1.2 0.7 1.5 2.4 0.8 1.5
1983 100.0 16.6 14.5 1.2 7.0 3.4 1.3 1.4 0.4 1.5 2.4 0.8 1.6
1984 100.0 16.0 17.2 1.3 7.0 3.8 1.4 1.5 0.5 1.5 2.4 0.8 1.6
1985 100.0 15.9 17.9 2.2 6.6 3.9 1.4 1.5 0.7 1.3 2.8 0.8 1.6
1986 100.0 16.6 18.5 2.1 6.2 4.0 1.6 1.5 0.6 1.2 2.6 0.8 2.1
1987 100.0 17.2 17.4 1.9 6.3 3.8 1.9 1.7 0.6 1.4 2.4 0.7 2.2

* From 1958 to 1970 included, the convention is 1 ECU = 1 US$.

1
World trade is the sum of EU (evolutive) trade with extra-EU countries and extra-EU trade with the world.
2
Evolutive EUtrade with extra-evolutive EU countries’ Evolutive EU is : EU6 (1958–1972), EU9 (1973–1980), EU10 (1981–1985), EU12 (1986–1994), EU15 (1995–2003),

155
EU25 (2004–2005), EU 27 (2006-…)
3
Relates to the external trade of the USSR until 1991 and from 1992 to the external trade of Russia.
4
Switzerland including Liechtenstein up to 1994.
Source: Eurostate, External and intra-European Union trade, statistical yearbook-data 1958-2006
156 After Empires

In a classified memo of February 1970, the European Commission took note of

growing global concerns surrounding its preferential trade agreements in Africa
and the Mediterranean.102 It agreed that there could be no cause for dispute with
the AASM, even in GATT, because the accords were legally watertight. The agree-
ments with Tunisia and Morocco, meanwhile, were justified by the memorandum’s
authors as having been provided for by the Treaty of Rome, and the accords with
the other Mediterranean nations deemed indispensable in order to avoid placing
them at a competitive disadvantage with respect to those two nations. But such
eminently political reasoning was not adequate to convince Europe’s allies across
the Atlantic, nor the other regional blocs that acted in concert within the United
Nations. The memorandum also discussed whether such a policy of regional pref-
erential agreements was in the long-term interest of the Community:
The commercial and economic potential of the non-European countries currently
associated with the EEC, or open to such association, is of relatively little importance
compared with that of the American and Asian nations that could form preferential
agreements with other regions of the world. In fact, less than 10 percent of the Com-
munity’s foreign trade is concluded with those African and Mediterranean states that
are linked to the Community through preferential agreements or those that could be
in the near future. These same countries represent approximately 10 percent of the
world’s population and 9 percent of the GDP of the developing countries in general.
The two authors of the memorandum were French, and as such assigned the highest
priority to the relationship with the African states, as well as those nations along the
Mediterranean that had long been linked to France throughout the colonial period. In
fact, notwithstanding their critical analysis of Europe’s association policy, they were
unable to formulate any alternative proposals for a comprehensive European policy
toward the South. They did suggest, however, that the geographic limits of Europe’s
preference policy—of which they were broadly supportive—be defined once and for
all: “The policy of regional cooperation constitutes a modest beginning for a Com-
munity foreign policy and, as such, is an incontestably positive development.”
It did not take long before the question arose about how to attenuate the criti-
cisms of those who criticized the EC for aiming to divide the developing world.
The accusations of the Latin American countries had been briefly appeased in
1970, when it appeared that a new round of discussions between the Community
and Latin America would result in the building of a new relationship based on
technical and financial cooperation. But long-nourished hopes for concrete action
on this front, shared by European nations like Italy, soon came to nothing.103

102
HAEU, EM 205, Communication de M. Deniau et de M. Rocherau, Secret, “Les problèmes
soulevés par les accords d’association et préférentiels conclus où envisages par la Cee,” February 6, 1970.
103
HAEU, BAC 25/1980, Parlement Européen, Rapport de M. Emile de Winter, “La Déclaration et
la Résolution adoptées le 29 juillet à Buenos Aires par la commission spéciale de coordination latino-
américaine,” April 19, 1971. The European Parliament’s report summarized the major events since the
last discussions between the EC and Latin America, which had opened with an Italian memorandum in
1968. These culminated in the Buenos Aires declaration, in which the members of the UN Economic
Commission for Latin America (UNECLA) made a solemn appeal to Europe, which led in January 1971
to the immediate application to the UNECLA nations of certain tariff reductions already anticipated by
the Kennedy Round. The same European Parliament thought it inopportune to go beyond such limited
measures, given the skepticism of many of its Member States toward the Latin American countries.
 The Developing Countries’ “Most Favored” Partner 157

Within the European Commission voices began to circulate in support of a more

global approach to the developing countries. The Commissioner for External Rela-
tions, Gaetano Martino, confirmed in a note that, with enlargement, which implied
a corresponding widening of Europe’s association with the African states and other
nations of the British Commonwealth, there would be a greater need to balance
regional activities with wider multilateral initiatives.104 In a study by a Commission
delegation the same concept was expressed, with different logic, to the international
organizations in Geneva.105 The study noted that, in light of the progressive global
reductions in tariff barriers, the tool of special preferences was losing practical effi-
cacy while continuing to generate negative reactions around the world. It was thus
necessary to seek other instruments with which to conduct a European foreign
policy aimed above all at technical and financial cooperation. A common policy of
this type would be much more useful in the Mediterranean, because it would allow
those countries to develop their own industrial base, and in so doing avoid the pro-
gressive and devastating growth of immigration in western Europe.
Debate over the creation of a proper European development and cooperation
policy had been particularly intense within the Commission under Malfatti’s presi-
dency. A Commission memorandum to the European Council defended the dis-
cussions on association agreements then under way—“one can’t now postpone
agreements that have already been reached or which are under negotiation”—but
proposed two ideas to escape from the criticism of their other trading partners:
1. go beyond mere tariff policy and “develop at the Community level some form
of technical and financial cooperation as well as a policy on foreign labor”;
2. “define the policy that the Community should follow as soon as possible,
particularly with regard to the countries of Latin America and Asia.”106
In 1970, discussions between government representatives on the Community’s
proposals demonstrated Member States’ stubborn resistance to a joint policy of
development cooperation.107 They declared themselves opposed to such coopera-
tion on technical and financial matters, and restated that the Community would
have to continue to follow a trade and tariff policy that suited their individual
interests, without bending to external pressures.
Only in July 1971 did the Commission put forward for the first time a specific
request for the launching of a common policy on cooperation and development.108

104
HAEU, EM 158, “La necessaria salvaguardia della politica esterna nei confronti dei paesi terzi
in via di sviluppo.”
105
HAEU, EM 156, Commission, Délégation permanente auprés des organisations internation-
ales à Genève, “Les nouvelles perspectives d’une veritable politique extérieure de la Communauté,”
February 6, 1970.
106
HAEU, EM 156, Comunicazione della Commissione al Consiglio, “Politica di Associazione e
regimi preferenziali della Comunità,” April 4, 1970.
107
HAEU, EM 156, Il Consiglio, Relazione del Comitato dei rappresentanti permanenti, “Comu-
nicazione al Consiglio relativa alla politica d’associazione e di regimi preferenziali della Comunità,”
May 8, 1970.
108
Bulletin of the European Communities, Supplement 5/71, “Commission Memorandum on a
Community Policy for Development Cooperation,” July 27, 1971.
158 After Empires

The Commission noted that heavy expectations were being placed on the EC in
light of its future enlargement, and declared that the Community could not
respond to these expectations by simply readjusting its tariffs. It was true that its
treaties left very limited space for a common policy on cooperation; nevertheless,
the Community had to pursue two ambitious goals in its approach to the South.
First, it must reorganize the internal economy of western Europe in such a way as
to open new spaces for imports from the poorer nations. Second, it would have to
dedicate itself to diversifying the domestic economies of the Southern countries.
This last goal could only be accomplished by giving the Community the “addi-
tional powers that would enable it to respond to such requests for cooperation.”
In debates over the Commission memorandum on July 4, 1972, the European
Parliament clearly illustrated the internal division between those who sought to
promote a more global role for the Community and those who believed such ambi-
tions to be fanciful and unrealistic.109 In a very detailed report the Dutch MP
Henk Vredeling complained that the EC already possessed various means of influ-
encing the Third World, but that these tools were not used in a coordinated fash-
ion, and noted that the Community was increasingly becoming a reference
point—both positive and negative—for the developing countries. He concluded
“[a]ccording to the Commission for international economic affairs, while technical
and financial aid lend themselves particularly to a regional application, the com-
mercial aspects could instead be open to a more global approach.” At the same
time, Vredeling demonstrated the deep fissures present within the parliamentary
commission:
I won’t hide the fact that the points of view expressed in the Commission present
significant differences. A majority would view a common policy on development aid
in substance as the continuation of a policy that we already employ with the Associ-
ated African States. A minority sees this differently. According to them, it is necessary
in principal to base such policy on the Community’s global responsibility . . . But this
minority would have the policy of association serve as a global model. In the mean-
time, we mustn’t treat the policy of African association as the Alpha and Omega.
In October attention shifted to the Paris summit, which the French President
Pompidou had promoted in order to restore his prestige as a continental leader in
view of enlargement. It was to be the first important meeting of European heads of
state and government since the Hague summit in 1969, and would outline poten-
tial future scenarios for the Community of Nine. As we have already seen, Man-
sholt had promised that at Paris the Community would present a new face to the
Global South. Expectations were equally high in important circles of the Commis-
sion bureaucracy, which viewed the summit as the potential foundation of a new
approach:
It is indispensable to present to the peoples of the Community, and particularly to its
youngest generations, as well as to the entire world, the image of a Community that,

109
Official Journal of the European Communities, n. 152/1972, European Parliament, “Report on
the sitting of July 4, 1972.”
 The Developing Countries’ “Most Favored” Partner 159
after the complicated process of enlargement, will pull its weight once more and be
conscious of its own responsibilities . . .
If what is needed is a new cycle on the model of “broadening, widening, and
deepening,” perhaps the following will suffice: “Solidarity, prosperity, and global
responsibility.”110
Italian Prime Minister Aldo Moro saw the Paris summit as an opportunity to reveal
a new side of the Community toward its own citizens as well as toward the coun-
tries of the world. It was necessary, he believed, to explain:
[w]hat responses we intend to give to the multiplicity of problems facing post–indus-
trial civilization, what solutions seem to us most promising to improve the quality of
life, how we propose to include the vast numbers of people at society’s margins in a
more equitable and meaningful way, not only to enjoy the fruits of our productive
processes but also the wealth of a spiritual life.
In substance: What image of a Europe of Ten do we intend to give to the young, to
the workers, to the man on the street, what can we offer that is new and different, on
what terms can we find “European” solutions for their problems.111
In the Commission’s note to the Council on the third UNCTAD, a document that
contained heavy traces of Mansholt’s influence and was finalized shortly before the
Paris summit, its authors drew a number of conclusions from their experience at
Santiago for the future of relations with the South.
First, it was observed that the Six had not been able to elaborate a clear common
line, given that the topics for North–South dialogue were of a nature that involved
both national and community competences simultaneously. It was clearly necessary
to remedy this situation as soon as possible, defining “a true Community develop-
ment and cooperation policy.”112 In the commodities sector activity would have to
be structured on three levels. In the case of industrial raw materials, like copper or
oil, the goal was to stabilize demand and compensate producers for any eventual
losses if demand should suddenly drop. In the tropical goods sector it was impor-
tant to reach individual product agreements at a global level that would satisfy all
producers. With respect to goods similar to or competing with European goods, like
agricultural products, long-term reforms were required to favor access to European
markets by modifying European support of its own agricultural sector.
The Community would have to extend the offer of preferences to all processed
agricultural goods, while at the same time improving their margins. Finally, finan-
cial aid would have to be concentrated to favor the poorest among the developing
countries. The note concluded:
Given that an enlarged Community can no longer limit its efforts at cooperation to
the African States and its future associates on the Mediterranean basin, and must

110
HAEU, FMM 58, E.P. Wellerstein, “Idées sur le Sommet,” Brussels, October 4, 1972.
111
Archivio Centrale dello Stato (ACS), Fondo Moro (Moro), Scritti e discorsi 1972, “Intervento
al Consiglio ministeriale della Cee,” May 26, 1972.
112
CEU, CM01/1972, Commissione delle Comunità europee, “Nota della Commissione al Con-
siglio circa i risultati della terza sessione della Conferenza delle nazioni unite sul commercio e lo svi-
luppo (UNCTAD),” October 5, 1972.
160 After Empires
progressively define a global policy with regard to all the underdeveloped continents,
it will have to make use of the level of development of the interested countries, as a
criterion to gauge the intensity of its efforts at cooperation.
The talk among the heads of state and government in Paris was not directed solely
at international issues. In fact, particular attention was paid to following up on the
objective of economic and monetary union, albeit through discussion of the social
issues that this would raise, and especially the need to address the balance between
the wealthy and poor regions of the continent, employment protection, and ideas
for control over the anarchic activities of the multinationals. But the session dedi-
cated to international relations was also extremely significant.113 The only Euro-
pean leader to request institutional dialogue with the United States was Willy
Brandt. The Federal Republic of Germany was playing defense regarding any
quantification of the investment necessary for a common development policy,
while Bonn’s principal attention seemed to be turned to the control of internal
inflation and the protection of German employment levels. All the other countries
participating with the exception of Heath’s Britain, which highlighted the impor-
tance of closer cooperation with Japan and private investment in the developing
countries, agreed on the need to send a signal to the Third World, whether through
improving conditions on aid, or widening European markets to imports. Provided
that only Mansholt was prepared to indicate an exact amount for anticipated
growth in imports from the developing world—from US$3 billion in 1970 to
US$12 billion in 1980—almost all the Member States called for a more open trade
policy and concrete measures in the area of technical cooperation. At the end of the
summit, the heads of state or government, while reaffirming their commitments to
the AASM and the Mediterranean, dutifully declared that:
remembering the outcome of the UNCTAD Conference and within the scope of the
development strategy adopted by the United Nations, the Community Institutions are
asked to activate an overall policy of cooperation in development on a world scale.114
After months of intensive debate between regionalists and globalists, pushed by a
public opinion highly sensitive to issues of development and critical of neocoloni-
alism, and engaged by a combative organized labor movement certain that the
future was on their side, European leaders seemed to have chosen to give the Com-
munity a global role and to act as a reference point for the developing world. Both
the regionalists, who obtained reassurance concerning their African and Mediter-
ranean commitments, and the globalists, who heralded the advent of a common
policy of cooperation with the rest of the world, could claim to emerge victorious
from the Paris Summit. The importance of the Community’s ties with the United
States appeared dramatically reduced. The Europe of the Nine would move for-
ward with new unity and self-confidence to open discussions with eastern Europe
at the Conference for Security and Cooperation in Europe (CSCE), renegotiate

113
HAEU, BAC 79/1982, n. 225, “Conférence des chefs d’État ou de Gouvernement (Paris,
19–21 Octobre 1972), Troisième séance.”
114
Bulletin of the European Communities, “Paris Summit Declaration, October 1972,” n. 10.
 The Developing Countries’ “Most Favored” Partner 161
the agreements with the African states to include those of the British Common-
wealth, open the way for a global Mediterranean policy, and side with the develop-
ing countries in the upcoming GATT negotiations.115 It was in 1972 that the
French political scientist François Duchêne formulated the notion of the European
Community as a “civilian power”: An entity that, in a world where the threat of
force was ever-less credible due to the nuclear annihilation that it would inevitably
produce, would influence the rest of the world with its “normative” ability (its sup-
port of supranational institutions, the resolution of conflicts though law, and the
soft power of its economic weight).116 The goal of Europe as a civilian power would
be to export through diplomacy the regulatory capacity that the European institu-
tions in Brussels had demonstrated in resolving the historic conflicts between
nations on the continent.
Underlying this rosy view, however, there remained an element of notable ten-
sion among the nations of the Community, which would become progressively
stronger in the coming years. The project of economic and monetary union was, in
fact, sinking in the mire of the very different economic policies implemented by
the Member States of the Community to respond to the inflationary pressures and
growing instability of currency fluctuations. The “monetary snake” that was sup-
posed to band together the currencies of the Nine within a set limit of fluctuation
against the American dollar was immediately weakened at the beginning of 1973
by the exit of the Italian lira.117 And, adding to the tensions on the monetary front,
the ambitious projects of wealth redistribution between the rich and poor regions
of the Community, which were supposed to solidify regional policy, were making
ominously slow progress.

115
On the birth of Global Mediterranean Policy, see G. Migani, “Rediscovering the Mediterra-
nean: first tests of coordination among the Nine”, in E. Calandri, D. Caviglia, and A. Varsori (eds),
Détente in Cold War Europe. Politics and Diplomacy in the Mediterranean. London: IB Tauris, 2012.
116
F. Duchêne, “The European Community and the Uncertainties of Interdependence,” in
M. Kohnstamm and W. Hager (eds), A Nation Writ Large? Foreign-Policy Problems before the European
Community (London: Macmillan, 1973).
117
A. Szàzs, The Road to European Monetary Union (London: Macmillan, 1992).
 5
The Year of Oil

On September 11, 1973, a retaliation appeared to be under way against the preten-
sions to economic independence of the most progressive Third World countries.1
The new military regime that had bombed Allende out of power, with the support
of segments of American capital, also delivered an unmistakable message to its
fellow Latin American nations: With deliberate symbolism, it established its head-
quarters in the very hall built at such great expense by the Popular Unity govern-
ment to host UNCTAD the year before. From this palace the military junta set out
to overturn Allende’s policy of nationalizing Chile’s vital mineral resources. The
World Bank signaled its tacit approval, albeit only after lively internal debate, by
reopening its aid coffers to the country.2
Yet Pinochet’s Chile, with its team of Chicago economists, proved to be quite
isolated in the international arena, at least in the short term: Nationalization,
reform of the Bretton Woods institutions, and redistribution of wealth toward
commodity producers remained the cardinal rules of the developing nations’ eco-
nomic doctrine. One month after the Chilean coup, the commodity-producing
nations discovered an extraordinarily powerful new tool to exert renewed pressure
on the industrialized world: Oil. By unilaterally imposing a fourfold increase in oil
prices before the end of 1973, both Arab and non-Arab oil producers, progressives
and moderates alike, would find themselves at the spearhead of a much larger
struggle to impose the de facto establishment of a New International Economic
Order (NIEO). Oil, the quintessential raw material, appeared to hold the key, as a
reinforcement or substitute for the only intermittently effective diplomatic pres-
sures from UNCTAD, to unlocking greater redistribution of global resources and
changing the organization of the international economy in favor of the Global
South.3
Inevitably, this process entailed serious consequences for a western Europe that
was heavily dependent for its energy needs on the Middle East oil fields. Intellectu-

1
Lubna Qureshi underlines that in the US administration’s dealing with Chile the economic
model offered by Allende was possibily a more important concern than the Cold War: “Nixon’s per-
sonal bogeyman was expropriation, not infiltration”: L.Z. Qureshi, Nixon, Kissinger, and Allende: US
Involvement in the 1973 Coup in Chile (Lanham, MD: Lexington Books, 2009), p. 15.
2
The palace that was supposed to host Chile’s largest cultural center was renamed, from the Gabri-
ela Mistral (named after the Nobel Prize-winning poet) to the Diego Portales (a nineteenth-century
conservative statesman), and became the seat of the military junta.
3
G. Garavini, “Completing Decolonization: The 1973 ‘Oil Shock’ and the Struggle for Economic
Rights,” in (2011) 33(3) The International History Review, pp. 473–89.
 The Year of Oil 163

als, in particular, began to circulate ominous predictions for Europe’s future. We

have already noted that liberals like Aron feared the possible downward slide of a
weak and frightened Europe into the socialist camp. The talk was about a possible
“Finlandization” of the continent. The first edition of The World in Depression,
Charles Kindelberger’s study of the Great Depression of 1929, appeared in 1973
and was soon the subject of heated debates which, if nothing else, served to con-
firm widespread sensitivity to the theme of economic collapse and all its attendant
dangers. Had it not been the crisis of 1929 which had helped bring Hitler and
Nazism to power, and encouraged the Soviet Union’s degeneration into Stalinist
paranoia? Were not the contemporary episodes of terrorism that threatened the
stability of the state in places like Italy and the Federal Republic of Germany signs
of a pervasive discontent throughout European society ready to boil over? It was
precisely this kind of pessimism among his fellow intellectuals that E.H. Carr criti-
cized in his preface to the second edition of his classic What is History?:
The revolt of the oil-producing states of the Middle East has brought a significant shift
in power to the disadvantage of the western industrial nations. The “third world” has
been transformed from a passive into a positive and disturbing factor in world affairs.
In these conditions any expression of optimism has come to seem absurd . . .
My conclusion is that the current wave of scepticism and despair, which looks
ahead to nothing but destruction and decay, and dismisses as absurd any belief in
progress or any prospect of a further advance by the human race, is a form of elitism—
the product of elite social groups whose security and whose privileges have been most
conspicuously eroded by the crisis, and of elite countries whose once undisputed dom-
ination over the rest of the world has been shattered.4
Would 1973 be remembered as the “year of Europe” and of renewed Atlantic part-
nership, as hoped by Kissinger; or rather as the “year of oil” and of the challenge
from both oil-producing and developing countries?5

THE OIL WEAPON

In the course of the twentieth century, the engine of the global economy increas-
ingly shifted from coal to oil. This development corresponded with a significant
transition in western Europe, from energy independence to reliance on petroleum
from North Africa and the Middle East.
The dangers stemming from the potential energy dependence of the continent
had been discussed as early as 1956 in a meeting of the Action Committee for the
United States of Europe, founded and run by Jean Monnet. On this occasion, the

4
Carr, What is History?, p. xii.
5
This was the question that historian and journalist Alfred Grosser was asking himself in the very
middle of the 1970s: A. Grosser, Les Occidentaux. Les pays d’Europe et les États-Unis depuis la guerre
(Paris: Fayard, 1978), p. 345.
Table 5.1. Energy Use in Selected Western European Countries (1937–1985) in million tons coal equivalent—MTCE

164
Year Energy use United Kingdom West Germany France Italy Netherlands Belgium/
Luxembourg

1937 Total MTCE 202 142 82 20 15 35

tons per capita 4.3 3 2.1 0.7 1.8 4
% coal 74 97 89 70 87 97
% oil 26 2 8 18 13 3
% natural gas – – – – – –
% other* – 1 3 12 – –
1952 Total MTCE 232 145 89 25 22 34
tons per capita 4.6 2.9 2.1 0.6 2.1 3.8

After Empires
% coal 90 95 79 43 78 89
% oil 10 4 18 35 22 11
% natural gas – – – 8 – –
% other – 1 3 15 – –
1957 Total MTCE 247 186 111 44 28 39
tons per capita 4.8 3.5 2.5 0.9 2.5 4.2
% coal 85 88 72 28 63 80
% oil 15 11 25 48 36 20
% natural gas – – 1 15 1 –
% other – – 3 9 – –
1962 Total MTCE 265 221 122 71 35 42
tons per capita 4.9 3.6 2.6 1.4 2.6 4.4
% coal 72 58 58 18 47 70
% oil 28 33 33 62 51 30
% natural gas – 5 5 13 2 –
% other – 4 4 18 – –
1967 Total MTCE 276 251 154 112 47 46
Year Energy use United Kingdom West Germany France Italy Netherlands Belgium/
Luxembourg

tons per capita 5 4.2 3.1 2.1 3.7 4.7

% coal 59 51 40 12 25 53
% oil 39 46 50 71 58 45
% natural gas 1 3 6 11 17 2
% other 1 1 4 6 – –
1972 Total MTCE 302 333 215 152 76 63
tons per capita 5.4 5.4 4.2 2.8 5.7 7.1
% coal 40 35 21 7 6 33

The Year of Oil

% oil 46 52 66 75 36 52
% natural gas 12 11 10 14 59 15
% other 2 2 4 4 – 1
1977 Total MTCE 285 355 231 177 79 65
tons per capita 5.1 5.8 4.4 3.1 5.7 7
% coal 38 32 20 7 5 25
% oil 41 50 63 70 36 50
% natural gas 19 15 12 19 58 22
% other 2 3 5 5 – 3
1982 total MTCE 275 370 250 195 86 68
tons per capita 5 6 4.7 3.3 5.9 7
% coal 35 34 22 10 6 28
% oil 39 46 58 65 40 46
% natural gas 23 17 14 19 52 22
% other 3 3 6 6 1 4

165
Source: Peter R. Odell, Oil and World Power. Harmondsworth: Penguin, 1986, pp. 120–1.
166 After Empires

group underlined the need for European cooperation on a civilian nuclear energy
project:
The energy supplies of Western Europe determine the progress or decadence of our
countries . . .
Today, Western Europe imports a fifth of the energy it uses. In ten years’ time, im-
ports will have to supply one-third of its needs. The greater part of these imports
consists of Middle Eastern oil.
Such dependence results in insecurity and permanent risks of conflict. Between
industrial and under-developed countries it hinders the collaboration which is indis-
pensable for freeing the disinherited masses of the world from their misery. The pos-
sibility of bringing pressure to bear on Western Europe by means of Middle Eastern
oil hinders the development of peaceful relations between East and West . . . 6
The world’s reliance on coal for energy declined at a rate even more precipitous
than that predicted by Monnet’s Action Committee: Dropping from 94 percent of
total global energy consumption in 1900 to 62 percent in 1950, reaching barely
28 percent by 1973. The consumption of “black gold,” in contrast, grew over that
same time span from 3.8 percent to 27 percent, and finally to 48 percent.7 Western
Europe was a particularly heavy consumer: Oil’s share of total energy consumption
rose from 20 percent in 1946–8 to 57 percent in 1971, while by 1973 Europe’s
energy deficit had reached some 50 percent of total consumption.8 To explain this
spiraling energy dependence Paul Bairoch notes that, until the 1950s, the trans-
portation costs for heavy commodities were so high that the only possible solution
was local consumption. The reduction of these transportation costs thus contrib-
uted, along with several other factors, to create the conditions for Europe’s depend-
ence, not only on oil but also on a wide range of commodities now available at
reasonable prices.9 Multinational oil companies were offering oil at low prices and
effectively determining energy policy across the continent.
In the 1950s and 1960s, that is during the period in which Western Europe was
becoming a regular importer of these commodities, we have seen how the Third
World experienced notable growth in production and exports without enjoying a
similar rise in profits.10 But then, in 1970 the better part of the world’s oil deposits
were still extracted and distributed by the largest Western companies, which also
set its price: These major conglomerates in fact controlled some 80 percent of
world oil exports, and 90 percent of crude oil production in the Middle East.11

6
Monnet, Mémoires, p. 421.
7
A.A. Attiga, Interdependence on the Oil Bridge: Risks and Opportunities (Kuwait: Petroleum Infor-
mation Committee of the Arab Gulf States, 1988), p. 10.
8
Bairoch, Storia economica, pp. 1134–6.
9
For example, while in 1950 western Europe remained self-sufficient in bauxite, by 1970 its defi-
cit was equal to 65 percent of consumption. In the case of iron ore the deficit grew from 6 percent in
1950 to 32 percent by 1970. See Ibid., p. 1150.
10
In 1961 the Third World produced 139,000 tons of ethane, out of a total global production of
165,000 tons; and extracted 17 million tons of the global total of 25 million tons of bauxite, and some
70 percent of the world’s diamonds: See Jalée, Le pillage du tiers monde, p. 27.
11
J.M. Chevalier, Les grandes batailles de l’énergie (Paris: Gallimard, 2004), p. 113.
 The Year of Oil 167

Although, after the creation of OPEC in 1960, oil-producing countries had man-
aged to raise their share in oil income by taxing the companies, the global oil
market was still a consumer’s market, driven by the dictates of multinational oil
companies.12
In the span of three years, the entire global oil market would be revolutionized
in favor of the oil-producing nations. Three factors contributed to this revolution
around 1970: First, producers began aggressively demanding their share in the oil
concessions and pressing for nationalization of their natural resources; second,
there were increasing signals of oil shortage on a global scale owing in part to in-
creasing demand from industrialized countries; and third, the Arab-Israeli con-
frontations were feeding Arab radicalism across the whole region. With the
agreements at Tripoli and Tehran in 1971, the OPEC countries demonstrated their
ability to impose unilateral hikes in the posted price of crude oil on the interna-
tional oil companies. Between 1971 and 1973 the extractive industries in countries
such as Algeria, Libya, and Iraq partially or fully nationalized their oil industries,
soon to be followed by all the other oil-producing nations.13
Algeria was at the forefront of this trend toward energy nationalization, having
already made preparations at the time of its independence by sending its own en-
gineers abroad to learn modern extraction techniques.14 Nationalization of Alge-
ria’s natural gas and petroleum resources in 1971 provoked heated protests in
France: President Pompidou threatened to close the country’s borders to Algerian
immigrants, halt imports of Algerian wine, block any future trade agreement be-
tween Algeria and the EC, and also pressured France’s European allies to cease all
purchases of Algerian oil. But cooler heads soon prevailed in France, while the
governments of all the Arab states slowly nationalized or obtained majority stakes
in the companies that controlled petroleum extraction. The goal of the producer
nations—aside from a rise in prices—appeared to be to achieve a degree of control
over means, technology, and level of production that would allow them to exploit
their valuable energy resources in order to plan and support further economic de-
velopment and industrialization.
Once national control over oil production had been obtained, a short-term rise
in the price of crude oil was next to inevitable due to the favorable conditions of
the international market. And yet, although the relevant facts regarding the “oil
shock” are well known, interpretations of the affair and its consequences continue
to conflict.15 On October 16, 1973, following the outbreak of the war between
Egypt, Syria, and Israel, the OPEC countries announced a new posted price for
crude of US$5.119 per barrel. The price increase was mainly prompted by the need
to recover inflation and dollar depreciation. This adjustment was quickly followed

12
On the oil-producing countries’ success in raising their oil revenues in the 1960s, see B. Mommer,
Global Oil and the Nation State (Oxford: Oxford University Press, 2002).
13
The best account of OPEC’s rise to prominence can be found in I. Skeet, OPEC: Twenty-five years
of prices and politics. Cambridge: Cambridge University Press, 1988.
14
A. Aissaoui, Algeria. The Political Economy of Oil and Gas (Oxford: Oxford University Press,
2001).
15
Attiga, Interdependence on the Oil Bridge; D. Yergin, The Prize: The Epic Quest for Oil, Money, and
Power (New York: Simon & Schuster, 1991).
168 After Empires

by the political decision by Arab oil producers (OAPEC) to put pressure on Israel
through planned cuts in production of 5 percent per month and an embargo
targeted at specific countries, foremost among them the United States and the
Netherlands. At the end of December 1973, once again all the OPEC nations set
a new price for crude of US$11.65 per barrel; by the end of the year, the crude oil
price had more than quadrupled. In the end, only the embargo imposed by the
Arab oil producers could be considered a direct response to the war; the rise in
prices was instead given a much more radical spin by the OPEC countries, among
them nations like Iran, that were neither Arabic nor particularly strongly antise-
mitic in their foreign policy. Both Iran and Nigeria increased production to make
up for the decreasing production by Arab countries.16
The oil shock has been considered by many, including Hobsbawm, as the end of a
“golden age”—characterized in western Europe by full employment and strong rates of
economic growth—and the beginning of an “age of crisis” dominated instead by infla-
tion, unemployment, and the troubled search for post–Fordist models of production.
Many scholars have expressed surprise regarding the ease with which the Anglo-
Saxon oil companies accepted the loss of all control over production and price-fixing
in the span of a few short months. Equally troubling was the absence of serious
plans or preparations to use force to bring the Arab states to heel, particularly in
contrast with the example made of the Iranian President Mohammad Mossadegh in
1952. There are those who have seen in this moderation unequivocal signs of a
cultural shift: Fossil fuels were by then considered to be a disappearing resource, and
thus priority was given to the ability to dispose of these assets safely, even at the cost
of unfavorable short-term conditions. There has also been a blossoming of theses in
support of the idea that the rise in oil prices was the result of a deliberate American
strategy to bring western Europe back in line with the Atlantic alliance by striking
at its economic base, at the same time reinvigorating the banks of Wall Street and
the City of London through the recycling of vast quantities of so-called petrodol-
lars. These interpretations are based on the idea that the rise in oil prices was not
unwelcome in Washington, because the USA was less dependent on imports than
western Europe or Japan. It is true that the Republican administration did not
spend an excessive amount of time attempting to contain the rising price of oil, and
that the international oil companies benefited greatly from it. But the fact remains
that a growth in oil prices had been widely predicted by almost all interested observ-
ers, given the new realities of the international oil market. All the available docu-
mentation suggests that the “oil shock” was the result of an autonomous initiative
by the Arab states and the non-Arab OPEC nations, acting in concert, which should
be understood in the broader context of their growing political consciousness and
the radicalization of the developing world.17

16
A very detailed account of the Arab oil embargo and its consequences can be found in Commit-
tee on Foreign Relations of the US Senate, “US Oil Companies and the Arab Oil Embargo: The
International Allocation of Constricted Supplies,” January 27, 1975.
17
FCO, Documents on British Policy Overseas, Series III, vol. IV, doc. 127, Telegram to Washing-
ton, “Message from Heath to Nixon,” June 15, 1973. In a letter from Heath to Nixon, (referred to in
this telegram) it is perfectly clear that, even before the Yom Kippur War, the two leaders were aware of
the risks facing the European economies from any potential Arab-Israeli conflict:
 The Year of Oil 169

It must also be remembered that the years from 1972 to 1974 witnessed a spec-
tacular rebound in the prices of many commodities other than oil. Speculation on
international markets, the increase in Western demand at the peak of its cycle of
economic expansion, the insistent demands for economic rights in many Third
World countries, the accumulation of substantial reserves, and fears of future scar-
city: Several factors combined to produce a “commodity boom.” In 1973 the
market price of copper grew some 115 percent and that of zinc 190 percent, while
prices for phosphates, coffee, and wood also witnessed exponential growth.18 There
were strong fears that the various producers of the Third World would follow the
example of OPEC, organizing themselves in cartels to drive up the prices of all
such basic commodities. These fears were not entirely unfounded, when one con-
siders that in 1974, for example, four countries alone controlled 80 percent of all
copper exports, two countries controlled 70 percent of global aluminum exports,
four other countries contributed more than half the rubber on world markets,
while yet another four furnished 60 percent of bauxite exports.19
The transformation of the western European economy in the 1970s is certainly
attributable to a much studied and discussed series of factors: The collapse of Bret-
ton Woods and the return of an unstable system of flexible exchange; the labor-
market rigidity imposed by the strength of the continent’s trade unions; the end of
a long period of mass consumption and the saturation of European markets; and
the emergence of new exporting countries and strong competition from Asia and
Latin America. But among these various causes of the crisis in the 1970s the oil
shock should be reserved pride of place, not only for its strictly economic impact—
energy costs did not represent the main component of production costs—but also
for its psychological effects on the citizens and their political leaders, and for the
debates it fueled over the future direction of economic policy. The oil crisis forced
Europeans to confront the consequences of the interdependence of the world
economy. The Third World had already penetrated western Europe through its arts
and literature, through the political myths of the generation of 1968 and their re-
jection of the old imperialism, and most directly through the impact of widespread
immigration. In 1973, it arrived on the shores of the old continent in the form of
an explicit threat. Its arrival shattered the illusion that modern industrial develop-
ment, with all its futuristic achievements and accoutrements, could constitute an
invincible shield to protect the West from outside events. The era of “the wonder
of modernity” was over, for the time being at least, and individual citizens were
forced to familiarize themselves with the practical, everyday implications of the
abstract concept of interdependence.

In this situation we are facing a danger with which Europe is becoming ever more aware—the risk of
an energy crisis. We Westerners are becoming ever more dependent on Arab oil and ever more ex-
posed to the consequences deriving from the movements of such large profits from oil. Every signal
indicates that the situation can only become worse, and that unless we succeed in doing something
with respect to Arab-Israeli tensions our industrial strength and future progress could be at risk.
18
G.P. Casadio, “Presente e futuro delle materie prime,” in (1974) 3 Politica internazionale, p. 36.
19
M. Colitti, “Lo sviluppo condizionato dalla logica del profitto,” in (1974) 9 Politica internazion-
ale, p. 42.
170 After Empires

Cheap gas at the pump, the “six-legged dog” of Italy’s ENI or the red scallop of
Royal Dutch Shell, the ubiquity of cars and motorcycles, road trips and ready re-
placement parts, inexpensive home heating and light at any time of day or night;
no European citizen had needed to worry about the easy abundance of energy that
they constantly enjoyed until the early 1970s. Within a few short months, all that
changed. By October 1973 the Dutch government, despite benefiting from the
ample availability of natural gas, found itself promoting basic energy-efficiency
measures: Encouraging citizens to ride bicycles or take public transportation, in-
troducing 100 km/hour speed limits for all vehicles, and endorsing the use of car-
pools to and from work.20 And when the citizens of several European countries
found the evening shows canceled at their local cinemas and theater halls, were
suddenly prohibited from driving on Sundays, or experienced cuts to such basic
public services as street lighting, it began to seem clear to many that the old days
of cheap energy were a permanent thing of the past. Beginning at midnight on
December 31, 1973, the Heath government in Britain declared a three-day work
week, deciding to supply power to state-run businesses for only three out of every
seven days. An IPALMO editorial of December 1973 reported that:
[o]nce upon a time the Third World disturbed the peaceful security of the inhabitants
of the so-called affluent societies only through their instability, through the recurrent
crises which, because of the protection or interference of the great powers, threatened
to compromise the general peace. In this Christmas season of 1973, although the price
of gas and the lights in the storefront windows are not truly indispensable to compre-
hend the original meaning of this holiday, the Third World has become, in Italy, in
Europe, in the countries struck by the partial oil embargo declared by the Arab states,
the cause of all privation and want.21
Well-informed European citizens understood the oil crisis and its effects according
to distinct philosophical and moral perspectives, exemplified in two letters to the
Financial Times. One writer embraced the “environmentalist” perspective of those
who hoped to exploit the hardships imposed by the Arab oil producers to promote
a “green” restructuring of the economy:
Exhorting customers to use less oil is a very unreliable way of conserving supplies.
Surely it would be better to offer all those sensible people who have properly insulated
their homes and factories a rebate on the installation costs or on their oil tax.22
Another writer, in contrast, called for a demonstration of force, such as an economic
“lightning strike” against the Arab states:
In all the commentary which has appeared in recent weeks, nothing has been said of
the most daunting aspect of all which ensues from the oil restrictions imposed by the
Arabs, that is to say the potential shift in the balance of power to the Russians . . . If

20
HAEU, EN 81, Délégation néerlandaise auprés des Communautés européennes, “Situation dans
le secteur du pétrole,” October 31, 1973.
21
“Questo ricco, ricco, Terzo Mondo,” in (1973) 12 Politica Internazionale.
22
“Letter to the Editor,” in Financial Times, October 27, 1973.
 The Year of Oil 171
exports to the Arab countries are stopped, within just a few months everything would
grind to a halt. Is it not better to have a short sharp economic conflict rather than to
be starved of energy to the point where we can no longer make an effective stand?23
In Italy, at the end of 1973 the government applied a series of austerity measures
to reduce energy demands: A prohibition of the use of cars on weekends and holi-
days; early closure of public offices and state-run businesses (at 5:30 and 6:30 pm,
respectively); a ban on television, theater, or film programming after 11:00 pm;
and limits on the illumination of public spaces and commercial zones—street
lights and shop windows were automatically dimmed after 9:00 pm.24 It should
come as no surprise that one of the first reactions to the need for more economic
austerity, in places where such phenomena were most visible, came in the form of
provisions to halt immigration; such measures were designed not only to protect
local employment, but also to exploit the widespread fears raised by the crisis to
reverse the tendency of such immigrants to establish a permanent European home
for themselves and their families.25 In West Germany, where foreign labor repre-
sented a significant part of the industrial workforce, anti-immigration measures
constituted an important safety valve to channel angry public demands to protect
national employment levels, without the need for government recourse to run
budget deficits or commit to extra public spending.
If 1968 in Europe was marked by a certain distancing from the economic and
political models offered by the United States, the oil crisis of the early 1970s shone
a harsh spotlight on Europe’s own preferred model for economic growth. Priority
could no longer be given solely to the need to improve the conditions of European
workers, nor to the gradual increase—for more or less altruistic purposes—in aid
to the developing countries. There was a need to rethink the foundations of the
European economy, up to that point based on a delicate balance between state
intervention and private enterprise, and on high economic growth. European so-
cialist leaders were quick to design the contours of a potential new economic out-
look. In December 1973, Willy Brandt, Bruno Kreisky, and Olof Palme met at
Schlangenbad in Germany to discuss the fallout of the oil crisis.26 Brandt argued
that the growing cost of oil could pave the way for a dramatic expansion of public
transportation networks and encourage a new technological boom with positive
effects on the environment. Kreisky, acknowledging the need for public transit
based on rails rather than roads, as well as a public system of energy production
and distribution, also foresaw new possibilities for the planned economy. Palme
went one step further, floating the idea that socialism should cease to consider
growth in GDP as a primary objective and find other strategic avenues for wealth
redistribution. According to the Swedish statesman, Europe should seize this

23
“Letter to the Editor,” in Financial Times, November 7, 1973.
24
G. Crainz, Il paese mancato. Dal miracolo economico ali anni Ottanta (Rome: Donzelli, 2003),
pp. 439–40.
25
Bade, Migration in European History, p. 229.
26
G. Arfè (ed.), Brandt, Kreisky, Palme: Quale Socialismo per l’Europa (Cosenza: Lerici, 1976).
172 After Empires

extraordinary opportunity to return to its roots, seeing as how both the Soviet and
the American models had lost their luster.
This was but one of many contemporary debates that European social democratic
leaders hoped would result in what one might call a “social democratic renaissance.”
And yet, somehow, not one of them thought to accuse the oil-producing nations. In
a November 1975 meeting titled “Which Socialism, Which Europe?,” Jacques At-
tali—a prolific writer and later adviser to French President François Mitterrand—
captured the issues at the heart of the matter. For Attali there were three interpretations
of the ongoing crisis: The first hinged on short-term factors, such as the rise in the
price of oil; the second on the saturation of the market and changes in the interna-
tional economy with the arrival of new producers; the third on the struggle—of
which inflation was a product—to create a society and model of development less
dependent on the constant turnover of new manufactured goods, with a larger role
for public services and greater responsiveness to workers’ needs. “Unless profound
steps are taken in the direction of socialist principles of political economy and power
relations,” he concluded, “the political and economic crisis in Europe is only just
beginning.”27 The analysis of Stuart Holland, one of the most important theorists of
the Labour left that came to power in the UK in 1974, was more pragmatic.28 Hol-
land argued that the reason why the application of Keynesian principles had failed
to produce the desired results was because of the presence of large multinationals
that could export capital and delocalize production to minimize the impact of rising
tax rates. He calculated that the state should maintain control over 30 percent of
turnover, 40 percent of profits, and 50 percent of employment, married to a policy
focused on growth and control over imports. All of these recommendations were
fully in line with the morally charged “austerity” proposals that Italian Communists
began to refine in view of the possibility that the PCI might enter into government
in a power-sharing agreement with the ruling Christian Democrats.29 In an October
1976 speech on austerity, prepared by his right-hand man Antonio Tatò—which
included the rather prophetic claim that “today we face a wall: either we tear it down
or go home”—PCI Secretary Enrico Berlinguer argued that earlier wage increases
from 1967–9 and the recent revolts in the Third World could not help but provoke
a backlash in the countries of capitalist prosperity:
Because of this, the war on waste has become a permanent part of the existence and
growth of every economic system, and with it a rigorous discipline guided by principles
of fairness. Even the workers’ movement must adapt to the landscape of austerity, to

27
“Quale socialismo per l’Europa,” ARA, Papers presented at the conference Quale socialismo, quale
Europa, November 1975 (Milan: Feltrinelli, 1977).
28
P. Seyd, The Rise & Fall of the Labour Left (London: Macmillan Education, 1987), pp. 25–7.
29
A. Tatò, Caro Berlinguer. Note e appunti riservati di Antonio Tatò a Enrico Berlinguer: 1969–1984
(Turin: Einaudi, 2003), p. 48. In a note to Berlinguer, Tatò—a leader of the CGIL and later Enrico
Berlinguer’s private secretary—counseled the PCI leader to distinguish between a “socialist” and a
“bourgeois” austerity. The latter “tends to criticize and attack the wage index (as if it were an ‘inflation-
ary’ device), the Worker’s Rights bill, the burdens of national labor contracts, the excesses of the trade
unions in the exercise of their rights and in their defense of workers’ rights to healthcare and a pension,
and sees in absenteeism, low productivity, and double employment, etc., the cultural ‘degeneration’ of
democracy and workers’ rights.”
 The Year of Oil 173
new models of development and lifestyle habits, to diverse patterns of consumption and
of the exercise of power, as well as solidarity with the peoples of the emerging world.30
If in western Europe the oil crisis seemed in the short term to have reinforced a trend
toward economic planning and the entrenchment of recent progressive social poli-
cies, even in many countries of the Third World the political will to keep state control
over economic indicators remained solid. The anticommunist Lee Kuan Yew, for
instance, for more than forty years president of Singapore—the most advanced of the
Asian Tigers—recalled in his autobiography how he refrained from touching state-
run healthcare, a lesson learned from William Beveridge’s Labour Party.31
An indirect confirmation of the impact of the oil crisis on the European political
class can be seen in the dismissive words of the Italian ambassador to the United
States Roberto Gaja:
The outbreak of the first oil crisis in 1973 gave rise to a series of violent critiques of the
capitalist social structure in our country. It was said that the gravity of the crisis was
due to a growth model that had been followed for many decades and that had been
dictated primarily by private interests, which had given rise to unacceptable amount
of privilege, among the automobile industry and the builders of highways for instance.
Alternative models of development were put forward, of diverse inspiration but always
substantially indebted to the Soviet model.32
The growth in GDP of the OECD nations had reduced in real terms, from a rate
of 5 percent annually throughout the 1960s to 3.5 percent from 1970–78. Over
the same period growth in manufacturing reduced from 5.9 percent to 3.5 per-
cent.33 After having experienced a brief wave of euphoria in the first few years of
the 1970s, manufacturing in western Europe fell by almost 9 percent in 1975,
before beginning to recover the following year. Throughout the West unemploy-
ment had almost doubled in comparison to the period 1960–73; the same could
be said for inflation, which doubled compared to the 1960s. Adding to govern-
ments’ concerns were the consequences of companies’ internal restructuring as a
response to trade union pressures, or as part of a broader shift in employment pat-
terns toward services, both public and private, and the tertiary sector. Right around
the middle of the decade the big companies most representative of the Fordist
model began large-scale diversification projects.34 Volkswagen, for example, in-
vested in the delocalization of its production chain to Brazil and Mexico; overall,
West German foreign direct investment grew approximately five times between
1967 and 1975. Italy’s Fiat likewise embarked on a program of intensive automa-
tion that would reach fruition only in the 1980s. Viewed from a different perspec-

30
“Una politica di austerità ispirata a giustizia sociale per trasformare e rinnovare il Paese,” conclu-
sions of the Central Committee of the PCI, October 18–20, 1976.
31
L.K. Yew, From the Third World to the First: The Singapore Story: 1965–2000 (New York: Harper
Collins, 2000).
32
Gaja, L’Italia nel mondo bipolare, p. 25.
33
D.H. Aldcroft, The European Economy 1914–2000 (London: Routledge, 2001), pp. 196–203.
34
B.J. Silver, Forces of Labor: Workers’ Movements and Globalization since 1870 (Cambridge: Cam-
bridge University Press, 2003), p. 53.
174 After Empires

tive, the data on the “real” economy, on anything from levels of employment to
growth in production, would remain relatively good until the end of the decade—
and certainly better than the figures of the 1980s. Only western Europe’s interde-
pendence with the global economy was much more clearly visible.
This was not yet the era of the “retreat” of the state from the economy, nor a
moment of absolute faith in the autonomous, almost demiurgic ability of free en-
terprise and private finance. The long wave of 1968 was still making itself felt in
the countries of the European Community. If anything the oil crisis helped push
Europe’s social democrats further to the left. We have seen that in 1974, Labour
would take power in Great Britain once again, while the demise of authoritarian
regimes in Southern Europe would open new spaces for European socialism. Start-
ing in 1974, in fact, public spending would begin to rise throughout Europe, as
politicians answered the challenge to combat the dangers of a cooling economy
with increased state investment. The power of workers’ movements was still such
that they could prevent businesses from maintaining their profit margins by cap-
ping salaries or through recourse to mass layoffs. Socialist governments tended to
encourage and promote “neocorporatist” agreements or complex revenue poli-
cies.35 It has been estimated that in the 1970s approximately one-half of the globe’s
strikes occurred in western Europe, making the continent the site of the world’s
most active labor movements.36

T H E N E W I N T E R N AT I O N A L E C O N O M I C O R D E R

It is impossible to comprehend the full meaning of the “shock” of 1973 without

viewing it in the broader context of the conflict between the developed and the
developing countries.
The great powers of the communist world, the Soviet Union and China, re-
mained in the background as mere spectators—although the latter did not with-
hold aid nor fail to make repeated entreaties to certain countries of the South,
encouraging them to develop an autonomous political economy completely inde-
pendent of the industrialized West.37 In a lengthy CIA report of 1975 regarding

35
W. Streeck and P. Schmitter, “From National Corporatism to Transnational Pluralism: Organised
Interests in the Single European Market,” in E. Gabaglio and R. Hoffmann (eds), The ETUC in the
Mirror of Industrial Relations Research (Brussels: European Trade Union Institute, 1998), p. 139.
36
Silver, Forces of Labor, p. 6.
37
NA, FCO 59/1231, Diplomatic Report, “The Soviet Union and the New International Economic
Order,” December 30, 1974. British diplomats eagerly speculated about possible tension between the
supporters of the NIEO and the USSR, and hypothesized that the Soviets were violently hostile to the
strategy of the developing countries because they recognized their inability to furnish development aid
and because they viewed the NIEO as a means of reconsolidating the hold of the West. NARA, CIA
archives, National Foreign Assessment Center, “The Nonaligned Movement: Dynamics and Pros-
pects, April 1979.” The Soviets’ room for maneuver was also limited with respect to the Non-Aligned
Movement: “It could be that Cuba will follow up on its efforts to redefine Non-Alignment as an anti-
imperialist force, more strongly connected with the Soviet orbit. Cuba, however, has demonstrated a
notable degree of flexibility, and it is not plausible that it will push this to the point of calling into
question the unity of the Movement.”
 The Year of Oil 175

the Soviet relationship with the Third World, American intelligence analysts un-
derlined the inability of the countries in the real socialist camp to influence inter-
national economic negotiations:
One important aspect of Soviet economic policy toward the Third World that has not
developed along with that of the United States, is its multilateral and institutional
policy. The most important phenomenon of the past decade has been the way in
which international economic institutions (IMF, World Bank, regional banks), multi-
nationals (banks and “corporations”), and international organizations (OPEC,
UNCTAD, GATT, FAO, conferences on commodities) have captured the attentions,
energies and projects of the Third World. For the countries of the Third World whose
borders are relatively stable (everyone except those in Sub-Saharan Africa, the Middle
East, and Indochina), the most important issues (food, energy, development, trade,
technology, health, education) are not handled bilaterally with the Superpowers but
through a growing international network in which the Soviet Union is in large part
either inactive or irrelevant.38
The fourth Conference of Heads of State and Government of the Non-Aligned
Movement was held at Algiers from September 5–9, 1973, just before both the
Pinochet coup and the beginning of the Arab-Israeli war. The Algerian president
Houari Boumedienne hoped to use the meeting to improve the cohesion of the
Movement, and at the same time to focus its activities on issues until then dealt
with mostly within the UNCTAD framework: Foremost among these the redistri-
bution of global economic resources and greater involvement of the South in the
decision-making processes of the international economy.39 For Boumedienne,
“non-alignment ceased to be—if it indeed ever had been—a force based predomi-
nantly on negation (of the two blocs, of the Cold War), in order to create a positive
politics aimed at affirming the rights of the emerging world.”40 Although Algeria
had wanted to demonstrate a clear distance from Moscow, Castro succeeded in
steering the conference away from any official declaration against the USSR by
noting that the Soviets possessed neither exploitative multinationals nor direct
control over Third World oil and mineral deposits.41
The Algerian leader was by then the entrenched leader of an authoritarian and
dirigiste government, albeit one with considerable popular support.42 He enjoyed
growing international respect, had experienced firsthand the influence of foreign
multinationals in his country, and understood the consequent need to create a
national industry free from the influence of the ex-colonial powers. He was well
aware of the fact that, immediately after achieving independence, Algeria’s econ-
omy had contracted by 35 percent due to its reliance on French expertise and the
French market, and that tens of thousands of Algerians had been left unemployed

38
NARA, CIA, “The US–USSR and the Third World.”
39
NARA, CIA, National Foreign Assessment Center, “The Nonaligned Movement: Dynamics and
Prospects,” April 1979.
40
Calchi Novati, Storia dell’Algeria indipendente, p. 201.
41
Andrew, The World Was Going Our Way, pp. 90–1.
42
M. Evans and J. Philips, Algeria. Anger of the Dispossessed (New Haven, CT: Yale University Press,
2007).
176 After Empires

as a result. At the same time, while the large oil multinationals had extracted some
US$4.8 billion in profits from the country’s oil fields, approximately half of which
swiftly left its borders, the royalties paid on these profits to the Algerian govern-
ment amounted to barely US$220 million. In 1964, the government had created
a national oil and gas company, Sonatrach (Société nationale pour la recherche, la
production, le transport, la transformation et la commercialization des hydrocar-
bures), and in 1969 had joined OPEC, while in 1971 the state acquired control of
51 percent of the oil sector and the entirety of its natural gas resources, inaugurat-
ing the era of energy nationalization programs in both Arab and non-Arab coun-
tries. Through past experience, the leaders of the FLN had developed the conviction
that international economic dependency could be subverted only by force, and
that the bourgeoisie of the industrialized nations would never truly engage the
issue of the international division of labor.43
The time had come to exploit the power of the oil weapon. At the beginning of
1973, Venezuela—the largest oil producer in Latin America and a pivotal country
in continental politics—was seriously considering membership in the Non-Aligned
Movement,44 believing that the Movement had shifted its emphasis from neutral-
ism to economic concerns. The Foreign Ministry’s newly elaborated position was
that:
the era when the democratic governments of Venezuela were afraid of the idea of ir-
ritating the United States or conservative sectors of our own countries are over . . . Right
now it is important that the African and Asian countries recognize the liberating, na-
tionalist and anti-neocolonialist content of our measures regarding oil, and that they
be willing to align themselves with Venezuela in a united front of defense against the
hegemonic forces that will try to deny us our right to set our own course.
It is equally important that Venezuela should not be left at the margins of this his-
toric process of the creation of new alliances and decision-making structures.45
In 1973, Algeria held the presidency of the Non-Aligned Movement, while an
Algerian was also Secretary-General of OPEC. Manuel Perez Guerrero, the
UNCTAD Secretary---General, spoke Arabic, had been Venezuelan oil minister,
and was a close friend of the Venezuelan “founder of OPEC ” Perez Alfonzo. At the
end of the Algiers conference, the leaders of the non-aligned states had approved
an Action Program for economic cooperation that touched upon their countries’
most urgent problems: From the need to open up Western markets, to trade agree-
ments on raw materials, issues of maritime commerce, and ultimately reform of
the international monetary system. The Action Program, which was received with
some skepticism by those nations with a more complex set of interests (such as
India or Yugoslavia), presaged a combative new alliance of commodity producers

43
M. Bennoune, The Making of Contemporary Algeria 1830–1987 (Cambridge: Cambridge Uni-
versity Press Middle East Library, 1988), p. 133.
44
In this respect, Venezuela was following the lead of Peru and the Argentina of Juan Peròn.
45
AHMPRE, Algeria, IV Conferencia de Jefes de Estado y Gobierno de los Países no Alienados,
Director de Política Internacional, “Venezuela y Los Países No Alineados,” January 15, 1973.
 The Year of Oil 177

based on the model furnished by the oil-producing nations, which could prove
capable of placing tremendous pressure on the industrialized world.
Alongside this strategy of North–South economic confrontation, the Algerian
president recognized the need to develop a project on a Mediterranean scale along
the lines of the Helsinki Conference, then negotiating the terms of détente be-
tween eastern and western Europe. The idea was to promote some form of Medi-
terranean détente that would have the effect of consolidating the political and
economic dialogue among the non-aligned countries along its shores, and at the
same time promote talks between Europe and the Arab states. This project, which
was similar to concepts floated in Italy by Prime Minister Aldo Moro, was pre-
sented during the preparatory phase of talks for the Conference on Security and
Cooperation in Europe in 1972, but it found few takers.46
On February 7, 1974, right at the height of the oil crisis, Boumedienne used
the Algerian position as president of the Non-Aligned Movement to call upon the
Secretary-General of the UN to convene a special session focused exclusively on
questions of trade and raw materials. He argued that, in light of the oil crisis, the
issues of commodities and development should be confronted together, and that
the General Assembly, as a democratic body in which all nations were repre-
sented, was the only appropriate forum for such talks. In a letter to the Secretary-
General, Boumedienne expressed his conviction that the ruling class of the
Western nations would be compelled in the future to resign itself to some form of
compromise:
Today, given that the working class no longer allows its rights to be trampled upon,
thanks to its collective organization, and that a growing number of Third World coun-
tries have acquired the right to set the price of their own commodities, building upon
the success brought about by their economic emancipation, the system of the Devel-
oped Countries is encountering serious difficulties trying to control inflation while at
the same time allowing profits to follow their own course unchecked toward ever
greater heights.47
Algeria also hoped to counteract the risk that the commodity-producing nations
would become isolated from the other developing countries.
In April 1974 the UN General Assembly dutifully convened its sixth special
session, the first in its history to deal exclusively with economic issues. In his open-
ing remarks—considered one of the most celebrated speeches in the history of in-
dependent Algeria—Boumedienne accused the West of having accepted the
principle of self-determination of peoples only after having grasped the reins of the
world economy. The industrialized countries, he argued, had then been able to
shield themselves from criticism through the granting of development aid; an
effort that was even more humiliating for its small sums in comparison with the
liberal amounts with which the developed countries had “aided themselves” after

46
“Editorial,” in (1973) 1 Politica internazionale.
47
Archives Nationales d’Algérie (ANA), Lettre du Président Boumedienne au Secrétaire- Général
de l’ONU.
178 After Empires

the Second World War—the reference here is to the Marshall Plan.48 After fierce
debate and without the sanction of a formal vote, the General Assembly approved
a resolution calling for the establishment of a New International Economic Order,
accompanied by a Programme of Action designed to put this into practice. Among
the Programme’s recommendations: the creation of a Common Fund for com-
modities with the aim of stabilizing prices and keeping them in line with inflation;
a generalized moratorium on Third World debt; the indexing of commodity prices
to those of manufactures; the freer and more rapid transfer of new technologies to
the developing world; and a lowering of tariff barriers in the developed countries.49
In its Point X, the Programme also called for the acceptance of a special program
in favor of the economies struck hardest by the oil crisis, an idea that was also
among the primary interests of the Western countries. Both the debt moratorium
and the creation of a Common Fund for commodities were designed to foster a
rapid redistribution of global profits toward the South.
The measures on raw materials in particular were immediately criticized by
economists, as well as by West German and American diplomats.50 It was noted
that commodities were for the most part bought and sold by the developed coun-
tries themselves, which would therefore be the primary beneficiaries of any re-
bound in prices. In addition, manufactured goods formed a growing segment of
the developing countries’ exports; while a rise in the prices of certain commodities
would result merely in the greater use of synthetically produced substitutes. Last,
there was one final argument against the creation of a Common Fund for com-
modities, and this was that oil constituted a special case: First, because the largest
producers had already created their own solid, authoritative organization; second,
because every Western industry was dependent upon oil as a source of energy, and
a decline in oil imports—unlike any other commodity—would result in reduced
growth and thus in a dangerous rise in unemployment.51 This type of reasoning
was taken to its extreme by Arthur Lewis, winner of the Nobel Prize in Economics
in 1979. In The Evolution of the International Economic Order, first published in
1978, he postulated that the export of manufactures was becoming ever more im-
portant for the developing countries—equal to 33 percent of their total exports in
1975—and that the problem facing these countries lay primarily in the fact that
extremely low salary levels had prevented them from forming sufficiently robust
internal markets.52 According to Lewis, criticisms of unequal trade were for the
most part unfounded and out of date, as were requests for aid and demands for a

48
UN, General Assembly, Sixth Special Session, Official Records, “Address by Mr Houari Boume-
dienne,” April 10, 1974.
49
NA, FCO 59/1231, Note, “Economic Discussions in UN Bodies: The New International Eco-
nomic Order,” November 25, 1974.
50
R.L. Rothstein, Global Bargaining: UNCTAD and the Quest for a NEIO (Princeton, NJ: Princ-
eton University Press, 1979), p. 40.
51
NA, FCO 59/1231, Draft Paper, “Comparison Between the Position of the Oil Producers and
that of the Producers of Other Commodities.”
52
A. Lewis, The Evolution of the International Economic Order (Princeton, NJ: Princeton University
Press, 1978).
 The Year of Oil 179

structural change in the global economy. The imperative issue from the perspective
of the Western countries would be confined to opening their markets to the import
of developing countries’ manufactures, notwithstanding the difficulties that this
could create in terms of domestic unemployment.
Such serious and well-grounded criticisms were not widely shared in the mid-
1970s, however, and in any event partially missed the point. Commodities re-
mained an indispensable source of income for the countries of the South. In 1973,
according to the analysis of Washington’s economic experts, the developing coun-
tries could count on a total of US$109 billion in exports: US$45 billion in oil and
related products, US$41 billion from other commodities, and only US$23 billion
in manufactured goods. More than fifty of these countries depended on three or
fewer products for the near-totality of their exports.53 Furthermore, trade in manu-
factures benefited only a small, if ever-more assertive, minority of emerging coun-
tries.54 Finally, it should be remembered that the South’s symbolic aims lay in
moving beyond the Bretton Woods order and initiating a radical reform of West-
ern economic institutions. Ultimately their goal was the creation of a new body, to
be controlled by the developing world, which would assume a role akin to estab-
lished economic institutions like the World Bank and IMF, which remained solidly
in the hands of the industrialized countries.
A report of the British delegation gives a perceptive synopsis of the various posi-
tions that emerged during the course of the UN Special Session on commodities.
According to the British diplomats, Algeria sought to prevent the OPEC nations
from being isolated and blamed as the sole parties responsible for the economic
crisis: Thus the Algerians aimed at achieving concrete measures to promote solidar-
ity among all the nations of the South. India, and other countries that were heavily
dependent on energy imports, wanted Western aid in whatever form they could
get it (on one hand), but hesitated to abandon the solidarity of the G77 nations
that had produced results in the past, and that they felt could produce many more
in the future.55 The communist countries were primarily interested in creating a
smokescreen to disguise their own mediocre track record regarding development
aid. The Western countries, meanwhile, remained passive and at cross-purposes.
The United States and France had their own, largely opposing projects of how to
deal with OPEC nations, while the Netherlands, and to a lesser degree Sweden,

53
Gerald R. Ford Library (GFL), Office of Economic Advisers (OEA), Seidman Files, Box 312
Economic Summit Briefing Book, “Relations Between Developed and Developing Countries,” June
27–8, 1976.
54
R. Sandri, La sfida del Terzo mondo (Rome: Editori Riuniti, 1978), p. 235. Regarding the EC and
its Generalized Scheme of Preferences adopted in favor of imports of the developing countries’ manu-
factures, Renato Sandri notes that only a small minority of countries actually benefited from it. In
1974, ten countries had used some 72 percent of the offer (Yugoslavia, Hong Kong, Brazil, India,
South Korea, Singapore, Pakistan, Mexico, and Iran). Furthermore, as the EC, along with Japan, was
the only group to offer preferential duties on textiles, Sandri suggests that “in reality the GSP has
heretofore made up a consistent part of preferential concessions to the production of textiles and
clothing of a small number of Developing Countries.”
55
NA, FCO 59/1231, UK Mission to the UN, “Reflections on the Sixth Special Session of the UN
General Assembly on Raw Materials and Development (9 April–2 May),” June 12, 1974.
180 After Empires

showed themselves ready to meet almost any request made of them by the South
with regard to the redistribution of global wealth. The English representative to the
UN painted the following portrait of the contemporary state of the North–South
divide:
I believe that what we have seen in the Special Session has been the first concerted
effort on the part of the developing world to demonstrate its maturity in the field of
international economic theory and organization. The rise in the price of oil has
brought home to the Industrialized Countries the vulnerability of their own econo-
mies and the Developing Countries have naturally tried to capitalize on this
awareness.
In any event, the outcome of the Special Session was a diplomatic success for Alge-
ria, which succeeded in reinforcing the developing countries’ united front and re-
iterating the message that the rise in oil prices, while damaging for the poor
countries, was vital to the Arab states because in the not-too-distant future they
would be left with nothing more than “a fistful of sand.” Algeria managed to out-
flank talks on the Common Fund with other goals that had even wider appeal,
such as the free distribution of fertilizers, as well as the abolition of debt acquired
prior to 1973.
The primary victims of rising oil prices, and thus OPEC’s most aggrieved adver-
saries, should in fact have been precisely those poor countries most dependent on
OPEC for their oil: The combined debt of these nations had grown from US$9.2
billion in 1973 to a whopping US$39 billion in 1975. But the internal unity of the
South did not break. In part this was due to the ties, both cultural and political,
that continued to bind the countries of the G77 and their leaders, despite any
potential conflict, against the West. The feeling expressed during the brief encoun-
ter of an Indian delegate with a diplomatic colleague from the European Com-
munity under the auspices of UNCTAD well encapsulated the climate: “You in
the West are interested only in your oil. Once you are able to buy it again at a low
price, you will promptly forget about us. This is why we intend to exploit the oil
crisis to force you into a general revision of the terms of exchange that will do us
more justice.”56 P.N. Dhar, economic advisor to Indira Gandhi, wrote of the high
hopes raised by the oil producers’ success, and the undeniable prestige enjoyed, if
only briefly, by the Arab states:
The oil-producing countries suddenly acquired tremendous political clout; they
became rich overnight, so rich indeed that some of them did not know what to do
with their new-found wealth. This was particularly true of Saudi Arabia and the Gulf
countries. Burgeoning oil revenues triggered an investment boom in West Asia, which

56
HAEU, BAC 25–1980, n. 987, “Report on the First Part of the 4th Session of the Trade Council
UNCTAD (August 20–September 14, 1974).” The MIT economist Jagdish Bhagwati reiterated this
notion, albeit in different words: “[T]he developing countries seemed to feel that finally there was one
dramatic instance of a set of primary producers in the Third World who were able to get a ‘fair share’
of the world incomes by their own actions rather than by the unproductive route of morally persuad-
ing the rich nations for fairer shares.” J.N. Bhagwati (ed.), The New International Economic Order: The
North-South Debate (Cambridge, MA: MIT Press, 1977), p. 6.
 The Year of Oil 181
created vast opportunities for trade and employment . . . The OPEC countries led the
demand for a new international economic order in the United Nations, where their
group dominated the counsels of the developing countries. Media commentators
talked about a new “Arab Century.”57
But it was also money that oiled the gears of global friendship. Support for the
strategy of the new international economic order was bought at a high price. Ac-
cording to documents of the American Treasury Department, in 1974 aid from the
OPEC states to the non-oil-producing developing countries amounted to some
US$7.8 billion.58 According to French sources, in the same year the overall sum of
OPEC aid reached US$16.2 billion, more than the total amount committed to the
Third World by all the Western states combined.59 Ibrahim F.I. Shihata, the direc-
tor of the OPEC Fund for International Development, itself created after the Al-
giers OPEC Summit in 1975, declared that in 1975 the OPEC countries had
provided financial assistance equal to 7.6 percent of their aggregate GDP.60 One
must be careful not overestimate the role of this OPEC money in the maintenance
of the developing countries’ united front, however, given that such aid was chan-
neled primarily to specific countries, in particular the Arab states and India.61 What
also kept the South united was the trepidation of certain countries at risking their
own energy supply.62
In 1973 a series of organizations were created by Southern nations to attempt to
manage the flow and trade of several commodities: For example UNICAF, the
organization of coffee producing nations like Brazil, Colombia and Cote d’Ivoire
to control the price of coffee; or CIPEC (the French acronym for the Intergovern-
mental Council of Copper-Exporting Countries), linking the four principal cop-
per-exporting nations (Zambia, Chile, Zaire, and Peru). An “unholy alliance” thus
seemed to be materializing, with the potential to grow stronger in the future, be-
tween the OPEC states and the oil-importing developing countries.
The year 1974 was marked by radical criticism of both the Bretton Woods insti-
tutions and the mechanisms of international free trade more generally. Roughly
one decade earlier, the famous Argentine writer Julio Cortázar had been on a train

57
P.N. Dhar, Indira Gandhi: The “Emergency” and Indian Democracy (Oxford, New Delhi: Oxford
University Press, 2000), p. 219.
58
GFL, OEA, L.W. Seidman files, Box 135, Memo, “OPEC Aid Commitments to Non-Oil
Exporting LDCs,” September 20, 1974.
59
Centre Historique des Archives Nationales (CHAN), 5AG3 (Fond Giscard d’Estaing), 150,
Note, “Déjeuner de travail avec M. MacNamara, Président de la BIRD,” April 27, 1973.
60
I.F.I. Shihata, The Other Face of OPEC. Financial Assistance to the Third World (London: Long-
man, 1982), p. 86.
61
OECD, DAC Review 1979, p. 136. Between 1976 and 1978 Egypt received 25 percent of OPEC
aid, Syria and Jordan another 25 percent, and Yemen, Lebanon, and Mauritania 5 percent each, while
India and Pakistan received another 11 percent.
62
NA, FCO 59/1231, British Embassy Brasilia to Sir Donald Maitland, September 18, 1974: “The
Brazilians, like India and the other Developing Countries, are hesitant to distance themselves from the
rest of the G77. The Brazilian stance is in part dictated by the desire to avoid anything that might
upset the African and Arab oil producers, and thus call into question the bilateral agreements that
guarantee their energy supplies.” See T. Skidmore, The Politics of Military Rule in Brazil, 1964–1985
(London: Oxford University Press, 1988), pp. 178–80.
182 After Empires

leaving Brussels when he was struck by his feelings of bitter rage, the emotional
inspiration for his subsequent comic noir novel Fantomas contra los vampiros mul-
tinacionales.63 The passage of a decade marked by growing confrontation with the
United States and suspicion of “Yankee” capitalist interference in the domestic
affairs of other nations saw the Latin American artist’s anger transformed into in-
ternational law with the Charter of the Economic Rights and Duties of States,
approved by a majority of the UN General Assembly on December 12, 1974.
The drafting of the Charter had been assigned to the Mexican President Luis
Echeverria by the participants at the UNCTAD conference in Santiago. Echeverria
had returned from the conference deeply impressed by the atmosphere of political
tension then brewing throughout Latin America, and believed that one way of
defusing this potentially revolutionary dynamic—which he personally had previ-
ously experienced (and eliminated) as Interior Minister during the violently re-
pressed student protests in Mexico City in 1968—would be the delivery of a new,
international legal system capable of forming a sort of protective dyke against such
outside interference.64 The first article of the Charter, in fact, declared: “Every State
has the sovereign and inalienable right to choose its economic system as well as its
political, social and cultural systems in accordance with the will of its people.”
Among the other rights asserted in the Charter were the freedom to nationalize
strategic sectors without penalty and the liberty of every state to manage its own
commodities. The Western front demonstrated cohesion in a losing cause, remain-
ing united in their hostility to such international legal dispositions.
In the 1970s multinational corporations had represented a disconcerting and
striking novelty for their economic weight. In 1977 General Motors, the world’s
largest company by market capitalization, produced total goods and services valued
at US$55 billion, a figure that—if it had attached to a state—would have made it
the twentieth largest economy in the world.65 Beyond the Charter, one of the most
interesting efforts made by the global South was the enactment of a Foreign Invest-
ment Code by the nations of the Andean Pact—Bolivia, Chile (until 1976),
Colombia, Ecuador, Peru, and Venezuela—to manage their relationship with the
multinationals. The legislation sanctioned the creation of an administrative board
to oversee the transfer of technology from the industrialized world, and required
multinationals to give local actors a share of ownership.66
During this period, the governments of the South demonstrated their intention
to create more binding, international, institutional mechanisms and to establish
new regulations where the forces of the free market had previously reigned to the
advantage of the stronger economies of the industrialized countries. The concerted
action of the Southern countries pushed the United Nations to discuss several

63
J. Cortázar, Fantomas contra los vampiros multinacionales (Buenos Aires: Ediciones Destino,
1965).
64
NARA, CIA, “Central Intelligence Bulletin,” Mexico, April 29, 1972.
65
W.J. Feld, Multinational Corporations and UN Politics (New York: Pergamon Policy Studies,
1980), p. 2.
66
S. Krasner, Structural Conflict: The Third World Against Global Liberalism (Berkeley: University of
California Press, 1985), p. 181.
 The Year of Oil 183

unresolved problems: The issues raised by the Andean Code of Conduct for Mul-
tinationals; the Law of the Sea, which was designed to expand the extent of territo-
rial waters; maritime transport, which was monopolized by a handful of
international shipping companies; management of radio frequencies and media
networks; regulation of the Antarctic to protect it from partition by the wealthiest
nations; and new rules for civil aviation. As Stephen Krasner has summarized, in
one of the rare studies dedicated to this subject:
Market-oriented regimes are inherently problematic because they provide unfair ad-
vantages for larger and more knowledgeable economic actors. Multinational corpora-
tions can manipulate transfer prices to evade taxation. Shipping liner conferences can
freeze out competitors from the Third World. International news agencies can mo-
nopolize the flow of information and issue distorted reports about developing areas.
Labor unions and firms in the North can appropriate the benefits of technological
progress. Sophisticated corporations can plunder the global commons with no con-
cern for the rights or well-being of poorer areas. International lending agencies can
impose politically embarrassing, even fatal, conditions on loans.67
The UN also debated the question of “global public goods” as resources to be man-
aged by international law. The Algerian jurist Mohammed Bedjaoui, for example,
argued that the fight of Third World nations to obtain control over their own natu-
ral resources, up to and including through nationalization, could not be consid-
ered in violation of international law because such governments were simply trying
to acquire and retain sovereignty over their own territory.68 He therefore called for
reform of international legislation to take into account the content, and not just
the form, of international relations. Such multiform criticisms of the international
order even called into question the way in which public information itself was
governed and distributed. While some 90 percent of radio frequencies, not to
mention almost all press agencies, were under Western control, the Tunisian direc-
tor of UNESCO put forward the goal of a “New World Information Order” that
would give more space to diverse cultures and take non-Western events and per-
spectives into greater account.69

E U RO P E ’ S I D E N T I T Y

On April 23, 1973, during the annual luncheon of the Associated Press in New
York, US Secretary of State Henry Kissinger announced the “Year of Europe,” in a
speech that would include some of the most controversial remarks of his public
career.70 Kissinger’s address was not a hymn singing the praises of European inte-

67
Ibid., pp. 86–7.
68
M. Bedjaoui, Towards a New International Economic Order (Paris: UNESCO, 1979),
pp. 98–104.
69
M. Masmoudi, “The New World Information Order,” in Le Monde, October 26, 1978.
70
“The Year of Europe: Address by Henry Kissinger (April 23, 1973),” in The Department of State
Bulletin, May 14, 1973, vol. LXVIII, pp. 592–8.
184 After Empires

gration; rather, it was a thinly veiled celebration of the United States’ political
savoir faire for its handling of the dialogue between the superpowers, and a declara-
tion of its plans to bring America’s anarchic European allies back on board by
persuading them to sign a new Atlantic Charter of shared goals and ideals. Kiss-
inger underscored the need to include Japan in the elaboration of a common West-
ern policy, insisted on the idea of a new trade agreement to relaunch the American
economy, and concluded by foreseeing growing responsibilities for the Nine at a
regional level, while on the global stage the United States would remain the sole
conductor of the orchestra of industrialized countries.
Rarely has an American foreign policy initiative been more poorly prepared than
the “Year of Europe,” in both its content and its timing. America’s desire to exploit
the recent entry of Great Britain into the Community by relaunching the Atlantic
Alliance was too transparent. The Nixon Administration’s political need to react to
the signs of crisis surrounding it, with its leaders already reeling under the weight
of the Watergate scandal, was too obvious. The US view of the continent was too
out of touch with Europe’s global responsibilities, in the eyes of a European public
opinion full of hardly disguised disdain for anything related to NATO.71
But Kissinger’s address had stung the Member States that had struggled fitfully
to move closer to the goal of a European Union they had set out at the Paris
Summit in 1972. The project of political union among the Nine was enmeshed in
the usual tensions between a French vision based on the propulsive power of its
states, and a German vision (shared by the Dutch and Italians, among others) that
gave priority to the reinforcement of the Community’s existing institutions. Plans
for a monetary union, meanwhile, were facing grave difficulties due to the growing
fluctuations in value of the European currencies. While Italy had already left the
“Monetary Snake” in February 1973, France itself was also forced to abandon the
Snake in 1974, following the most recent devaluation of the dollar the previous
year and the ongoing impact of the oil crisis.72 Currency instability even called into
question the smooth functioning of the Common Agricultural Policy, which con-
stituted by far the largest item in the Community budget.
At the European Summit held in Copenhagen from December 14–15, 1973,
the Nine failed to devise a common policy in response to the oil crisis but did
manage to demonstrate, in a declaration on European identity, their willingness to
shape a vision of Europe’s global role.73 In the declaration, the Nine did not openly
distance Europe from the Atlantic Alliance, but emphasized the Community’s
global ambitions. The very same accent on the open question of Europe’s identity,
to be developed through an autonomous foreign policy, signaled an obvious retort
to Kissinger’s paternalistic project. During the summit, a delegation of foreign
ministers from the Arab states—Tunisia, the United Arab Emirates, Sudan, and
Algeria, probably put together through French diplomatic pressures—was officially

71
P. Winand, “Loaded Words and Disputed Meanings: The Year of Europe Speech and its Genesis
from the American Perspective” in van der Harst (ed.), Beyond the Customs Union, pp. 297–317.
72
Eichengreen, Globalizing Capital, pp. 154–5.
73
A.E. Gfeller, “Imagining European Identity: French Elites and the American Challenge in the
Pompidou–Nixon Era,” in (2010) 19(2) Contemporary European History.
 The Year of Oil 185

received by the Danish government; an episode that apparently helped facilitate

the inclusion in the final communiqué of a declaration in support of the rights of
the Palestinians (previously asserted by the Nine in a statement of November 6), as
well as a call to open a dialogue with the oil producers.74 These developments took
place while, throughout the second half of 1973, Kissinger complained that “talk-
ing with the Europeans was becoming worse than negotiating with the Soviets.”
They constantly submitted questions on items that had already been discussed and
were no longer subject to change, he continued, so that it was almost as if enlarge-
ment, rather than “elevating” Europe to the level of Great Britain, was “lowering”
Great Britain to the level of Europe.75 The Copenhagen summit had been preceded
by various surveys conducted by Boumedienne and aimed at reminding the Euro-
peans that, once peace had been reached in Vietnam, with the tensions between
East and West apparently subsiding the most explosive area in world politics re-
mained the Mediterranean, racked by the problems regarding Israel and the oil
question. In an interview published in the Belgian daily Le Soir, the Algerian leader
openly called on the Community to take a stand:
If you look closely, we complement each other and can work together to our mutual
advantage. Europe finds itself at a crossroads. It is slowly starting to assume a global
role. If it accepts being the faithful ally of American imperialism it will become our
adversary; if, instead, it opts for an independent role it can, with our cooperation, do
great things.76
The Saudi Prince Abdul Aziz expressed the practical foundations of the same idea
in remarks to the Manchester Guardian shortly after Copenhagen:
If the winds of US policy continue to fill the sails of Israel, as they do today . . . the
momentum of history may join ourselves and the Europeans in a unique and deep
friendship. . . .
For our part we need European expertise in the field of land reclamation, industri-
alization, and armaments. The Europeans need our oil, our other raw materials, and
our markets.77
Yet shortly after the summit, in which the Nine solemnly declared their intention
to work toward closer unity in foreign policy, their confused reaction to the oil
crisis demonstrated the obstacles lying in the path of political cooperation. The
French defined the decisions taken in Copenhagen with respect to the oil ques-
tion—that is, those aimed at energy efficiency—not an oil policy, which would
have entailed joint European agreements on energy supply, but rather an “organi-
zation of scarcity”; they charged that the summit had defended the interests of the
large oil companies in certain countries, foremost among them the Netherlands,
and that this depended on the fact that not every European country was reliant on

74
A. Shlaim, The Iron Wall: Israel and the Arab World (New York: W.W. Norton & Co., 2001).
75
FCO, Documents on British Policies Overseas, Series III, vol. IV, Washington Telegram, “Analy-
ses shortcomings of the ‘Year of Europe’,” December 3, 1973.
76
Le Soir, September 27, 1973.
77
The Guardian, January 9, 1974.
186 After Empires

oil to the same degree. The Dutch Labour government, which maintained a pro-
Israel stance and strongly opposed a common European overture toward the Arab
countries, indeed resisted any energy policy that threatened the free market for oil,
also pressured by the Anglo-Dutch Shell company and the huge refining industries
of Rotterdam. The Dutch position had prompted Pompidou to grumble that “the
Dutch hate France: It is the only constant of their history. They lecture us on
Europe, but want it to look just like America.”78 In fact, any European oil policy
based on bilateral supply agreements with the Arab states would have implied
greater European autonomy from the foreign policy of the United States and a
massive transfer of the Arab world’s considerable oil wealth onto European shores.
This was precisely the objective of the French Foreign Minister Michel Jobert, and
the fears of his American counterpart Henry Kissinger.
In order to avoid the risk that Europe would develop a coordinated and autono-
mous energy plan, the United States had proposed a meeting of the largest energy-
consuming nations to be held in Washington in February 1974. The goal was to react
to the Arab oil policy by opposing it with a united Western front, and in so doing
bring the oil-producing nations to heel. Along with the political desire to reconsoli-
date the Western alliance, the idea was born of the fears of the major oil companies
at the proliferation of bilateral agreements between the oil producers and individual
European countries and state oil companies, which could dry up the free market for
exports and limit the opportunities to recycle petrodollars through the banks of Wall
Street and the City.79 Italy and France were not alone, in fact, in concluding bilateral
agreements with the Arab states based on decades-long contracts to purchase oil in
exchange for military technology and technical and financial cooperation.80
Eight of the nine Community countries—among them Italy, albeit with reser-
vations81—had accepted the offer of a conference in Washington, the results of

78
On the European reactions to the oil shock, a detailed reconstruction of the years 1973–4 can be
found in D. Hellema, C. Wiebes, and T. Witte, The Netherlands and the Oil Crisis: Business as Usual
(Amsterdam: Amsterdam University Press, 2004).
79
Archivio Ente Nazionale Idrocarburi (ENI), Estero, Nua 979, Busta 27, GL, Stampa Estero,
Riservato, “Sull’accordo Franco-Saudita,” Rome, November 29, 1974. Jobert was then negotiating
with Saudi Arabia an agreement to import 800 million tons of oil over twenty years.
80
FCO, Documents on British Policy Overseas, Series III, vol. IV, Secret, Note to Prime Minister,
“Oil Supplies,” December 13, 1973.
81
This was the furious reaction of Marcello Colitti, a prominent ENI executive, to the rather un-
prepared presentation of Italian Foreign Minister Aldo Moro in Washington:
The strategy of mediation failed, but this cannot justify an address like that given by the Italian
Foreign Minister this afternoon. Moro spoke in Italian, in his cryptic style, throwing together
apparently contradictory statements with those interminable circumlocutions of his, which lose all
sense by the fourth word. From what you heard through the earpiece it was clear he gave the
translator extraordinary difficulty; shortly thereafter the man admitted he was unable to continue,
bursting out that since he couldn’t understand a word he would simply remain silent. “It doesn’t
make sense anyway,” he added, to the laughter of the entire audience. Moro droned on for another
twenty minutes, for the exclusive benefit of the Italian delegation, while everyone else got up and
talked among themselves. On this ridiculous note the Italian pretense to any autonomous energy
policy or position toward the Third World came to a end. The untranslatable sentences of Aldo
Moro buried everything we tried to construct through several years of hard work without leaving
Italy anything to show for it, even forcing us to join the agency at the back of the line, the country
rebuked and called upon to explain its weak if not utterly non-existent energy policy.
 The Year of Oil 187

which would be dismissed by Jobert with the terse statement “France’s friends are
elsewhere.” Following the meeting, the oil-consuming nations would join the In-
ternational Energy Agency founded under the aegis of the OECD in November
1974. Thus the IEA did not become a new institution to confront oil producers,
as Kissinger had wished, but rather a new part of an existing international institu-
tion.82 In reality the Washington conference of foreign ministers had produced few
results in terms of oil cooperation; as the Algerian oil minister Belaid Abdessalam
later commented, “all this controversy has produced very little for Algeria to fear.”83
Venezuelan diplomats also remarked that, while there was no real prospect of soli-
darity among consumers, since the USA would never sacrifice its citizens’ comfort
to satisfy the needs of other consumer countries in the event of a shortage, there
was a possiblity that the Energy Agency might convince new oil producers such as
Norway not to join OPEC.84 Kissinger had not persuaded his counterparts to take
any decision on the emergency exchange of oil, nor to take positive steps on the
alarming notion of formal cooperation between the oil-consuming nations and the
developing countries. France had very different ideas, that it unveiled to both its
European colleagues and the UN Secretary-General at the Community Council of
Ministers meeting from January 14–15, 1974, dedicated to energy issues.85 The
French plan was to convene a global energy conference at which all nations, in-
cluding the oil producers, would engage each other and discuss solutions that
would ensure a stable supply at a fair price. The kernel of this French idea would
in time form the basis for a new negotiating platform between North and South.
In the meantime the Euro-Arab dialogue desired by the Arab delegations at
Copenhagen had taken off. It had begun to acquire foundations in the first half of
1974 with calls for cultural and immigration initiatives, as well as proposals for the
creation of joint ventures employing mixed Arab and European capital. The dia-
logue even had its semi-official publication: The journal Eurabia edited in Paris
from 1975 and involving intellectuals and members of parliament from western
Europe and the Arab world. One weak point remained the fears of the Commu-
nity’s Mediterranean nations regarding a possible widening of preferential trade
agreements, not to mention the Arab states’ firm resistance to the inclusion of the
oil question in any such discussions. But above all the dialogue stood on shaky
ground because it was unable to confront the key issue of the Arab-Israeli conflict,

82
F. Petrini, “L’arma del petrolio: Lo ‘shock’ petrolifero e il confronto Nord–Sud. Parte prima.
L’Europa alla ricerca di un’alternativa: La Comunità tra dipendenza energetica ed egemonia statu-
nitense,” in Caviglia and Varsori (eds), Dollari, petrolio e aiuti allo sviluppo, pp. 79–109. See also Ri-
chard Scott, The History of the International Energy Agency—The First Twenty Years, vol. I: Origins and
Structures of the IEA. Paris: OECD/IEA, 1994.
83
ANA, Fond Abdessalam, Mission d’explication des mesures prises par les Pays arabes product-
eurs de petrole au landemain de la guerre du 6 octobre 1973, “Comptes-rendus des visites effectuées
par MM. Abdessalam et Yameni en Europe, aux Etats Unis d’Amérique et au Japon, Commentaris sur
la visite de Abdessalam aux EUA du 2 au 10 Février, 1974.”
84
AHMPRE, 1974, Interior, Petróleo (AIE), “Antecedentes, creación y perspectivas de la Agencia
Internacional de energía (AIE),” Caracas, November 25, 1974.
85
Archives Historique de la Commission Européenne (AHCE), Cabinet Cheysson, BAC 25/1980,
Michel Jobert, “Aide Mémoire,” January 1974.
188 After Empires

and because it presupposed the two sides’ complete autonomy from US foreign
policy: A condition that in the mid-1970s—despite Kissinger’s fears of an increas-
ingly independent Europe—simply did not exist.86 Indeed, it was in April 1974
that the “Gymnich formula” was adopted, according to which the United States
would be consulted prior to every important meeting of European Political Coop-
eration, which was then handling Mediterranean issues.87 After the trauma of the
oil crisis, the Gymnich formula was erroneously heralded, even by contemporaries,
as the end of “any European challenge to American hegemony.”88 Although the
Europeans did not play a major role in the Arab-Israeli conflict, however, they
would shortly take the initiative on questions of raw materials and the interna-
tional economy.
While it is true that the process of East–West détente and the preliminary nego-
tiations for the CSCE remained the center of attention for most European political
leaders, with their goal of giving Europe a larger role in the easing of tensions be-
tween the superpowers, the Yom Kippur War and the oil crisis still seemed to have
opened the eyes of the Community to new opportunities for the Mediterranean.
In November 1973, at a conference of socialist party leaders, Willy Brandt—re-
sponding to the accusations of Israeli Prime Minister Golda Meir regarding Eu-
rope’s pro-Arab stance—outlined this notion clearly: “Some of us, or at least those
who come after us, will live to see a day in which there will be another political
force in the world, and that force will be Europe.”89
Another event that helped prompt a revision of European socialists’ policy
toward the Third World—strengthening the push for European independence
from Washington—was the military coup d’état in Chile. Salvador Allende had
never hidden his hostility to the Socialist International, which he believed little
more than an alliance of European and North American capital,90 but he had nev-
ertheless received many of its leaders, such as Palme and Mitterrand, who were

86
D. Allen, “Political Cooperation and the Euro-Arab Dialogue,” in D. Allen, R. Rummel, and
W. Wessels (eds), European Political Cooperation (London: Butterworth Scientific, 1982), p. 69. ENI,
Estero, Nua 978, Busta 27, Mae, Dgae, Cee, Riservato, “Dialogo Euro-Arabo. Stato dei lavori in vista
della Commissione generale euro-araba,” November 29, 1974. Italian diplomats underlined the dis-
tance between the French position, “largely directed at achieving concrete results quickly,” and the
British position “aimed at greater preliminary detailing of the overall conditions on which to base
Euro-Arab cooperation.”
87
C. Hill and K.E. Smith (eds), European Foreign Policy. Key Documents (London: Routledge,
2000), p. 97.
88
D.P. Calleo, “America, Europe and the Oil Crisis: Hegemony Reaffirmed?,” in J. Chace and E.C.
Ravenal (eds), Atlantis Lost: US-European Relations after the Cold War (New York: New York University
Press, 1976), p. 128.
89
IISH, Socialist International (SI) 347, Report, “Party Leaders’ Conference: London,” November
11, 1973.
90
J. Ziegler, “L’Internationale Socialiste. La reconquête de l’Amérique,” in Le Nouvel Observateur,
October 11, 1979. This was Régis Debray’s note of his conversation with Allende: “Q: This explains,
then, why for a long time the Chilean Socialist Party has had nothing to do with European social de-
mocracy. A: Exactly. It has nothing to say to them, not even to certain parties in Europe that call
themselves socialist.” See R. Debray, Conversaciòn con Allende (Buenos Aires: Siglo XXI Editores,
1971), p. 145.
 The Year of Oil 189

interested in understanding his perspective. In an emotionally charged emergency

meeting of the Socialist International held in the immediate aftermath of Pinoc-
het’s coup, European socialists sought concrete means for coordinated reaction.
The French suggested proposing Allende for the Nobel Prize, the Germans acting
through the SPD’s cultural wing (the Friedrich Ebert Stiftung) to call for the lib-
eration of those incarcerated. The International finally decided to send an investi-
gative committee to Chile to reconstruct the exact sequence of events.91 The fall of
Allende had seemed to eliminate any hopes that a strategy of socialist reform could
succeed in Latin America through the democratic process. The future challenge for
the socialists was thus made clear, and stated in no uncertain terms:
Today it is more important than ever that the Socialist International demonstrate that,
after Chile, democratic socialism is not finished; that it desires and can still play a role
in this hemisphere, supporting continental emancipation and liberation movements
against foreign intervention.
With regard to Cuba, we have adopted too rigid a stance, an offspring of the Cold
War. It is urgent that we reconsider this. Cuba is not an obstacle to the independence
and freedom of Latin America. It is the political and economic interests of the United
States that play the greatest role on that Continent.92
The Mediterranean nevertheless remained an important zone in which Europe
sought to express its new identity. This was made clear in the concluding talks of
the CSCE, during which many European leaders reiterated that, once the tensions
of the Cold War had been eased on the continent, it would be necessary to turn
their attentions southward to the Mediterranean. The words of the Austrian Chan-
cellor Kreisky, who handled the Arab-Israeli conflict for the International and who
was himself of Jewish descent, were particularly strong in this regard:
The Mediterranean is in many respects the cradle of our civilization. The fact that the
world’s great religions originated there and that much of our society has come from
that region imposes on us a great responsibility. Thus, even if we are fully aware of the
delicacy of these issues, here we appeal to the governments of the Arab nations and to
Israel to do everything they can to resolve their disputes peacefully.
There must be a way to respect the rights of both Israel and Palestine. And tied to
this is a question that concerns Europe in particular. A large group of industrialized
nations that consider themselves belonging to the West are still dependent for their
supply of oil, in some cases as much as 98 percent, on Middle Eastern imports. In fact,
when we speak of oil we refer to a very particular commodity, for which we must
quickly find some form of constructive cooperation between Europe and the Middle
Eastern oil-producing countries. A cooperation that consists of something more than
simply buying and selling. It must be a special form of cooperation that we bring into
being.93

91
IISH, SI 293, Minutes of the emergency meeting of the Socialist International, London, Sep-
tember 22, 1973.
92
IISH, SI 420, Socialist Strategy Study Group, “Study Group on Socialist Strategy for the Third
World,” November 8, 1973.
93
ACS, Moro, b. 122.
190 After Empires

This impulse to a renewed investment in the Mediterranean, not only as an eco-

nomic partner but also as the symbol of a more open Continental identity, was also
strong in intellectual circles. One example of such cultural excavation linking past
and future identities was Fernand Braudel’s 1977 study of the “space and history”
of the Mediterranean, a follow-up to the historian’s famous work The Mediterra-
nean and the Mediterranean World in the Age of Phillip II. The French historian,
without denying the clash of civilizations that always populated the area, empha-
sized the richness of its cultural exchange and material traditions that had infused
the sea in the past, and which could bring its many different shores closer together
in the future:
There is all the West on one side (the Greeks and the Latins), all the Orient on the
other. The breadth of the conflict dramatizes and amplifies the shock. At Marathon
the Greeks save a West threatened with subversion. Rome strikes the Orient by de-
stroying Carthage. The Crusades all surge obstinately in the same direction. The taking
of Constantinople in 1453 is Islam’s impressive response. Lepanto, tardily (1571),
puts in play the safety of the entire Mediterranean, overwhelmed by the Turkish fleet
and the barbarian corsairs.
All this is clear: once the civilizations are all on the field, how can they not
clash? . . .
Civilizations, in fact, are all too often nothing but ignorance, disdain, or hate for
the other. But they are not only this. They are also sacrifice, influence, the accumula-
tion of cultural wealth, the heredity of knowledge. If the sea has witnessed the war of
these civilizations, it has also brought them a multiplicity of exchanges (technologies,
ideas, popular beliefs) and the multiform spectacles that it offers us today. The Medi-
terranean is a mosaic of a million colors.94
Speaking of Braudel’s work, Giuliana Gemelli has written of the search for a new
European cultural universalism, posited in opposition to the American model, as a
response to the continent’s loss of political power. The Mediterranean, and not the
Atlantic, would thus become the historical unifying center of the West, represent-
ing a sort of Défi Latin.95

T H E S U C C E S S E S A N D FA I LU R E S O F T H E C O M M U N I T Y ’ S
GLOBAL POLICY

In 1973, after the admission of Great Britain, the EC began the renegotiation of
the Yaoundé Agreements in order to include those countries of the Common-
wealth in a position “comparable” to that of the Associated African States. The
inclusion of the former British colonies in the previous agreements with the AASM
had been guaranteed by a provision of the UK admission treaty. Yet the negotia-
tions proved difficult for the Community, not least because they took place amid a
groundswell of growing radicalism within a South that was galvanized by the suc-

94
F. Braudel (ed.), La Méditerranée. L’Espace et l’Histoire (Paris: Flammarion, 1985), pp. 172–3.
95
G. Gemelli, Fernand Braudel e l’Europa universale (Venice: Marsilio, 1990), pp. 188–90.
 The Year of Oil 191

cess of the oil-producing countries. Great attention was paid to perfecting the de-
tails of the accords with Francophone Africa and those African and Caribbean
nations tied to Great Britain; this was due to pressure from Paris, which did not
want to lose its privileged political and cultural ties, or the significant economic
advantages guaranteed by the agreement, which contributed to easing French aid
spending and favored its exports. French insistence on the reinforcement of Euro-
pean regionalism in Africa prevailed, in the end, over the increasingly pronounced
doubts of countries such as Germany and the Netherlands.
The new negotiations undoubtedly signaled an improvement over the previous
Yaoundé agreements, and a major step forward in the creation of a real develop-
ment of a Community policy for the South.96 A significant role was played during
the negotiations by the French socialist Commissioner for Development Claude
Cheysson, who was more sensitive than his predecessors to the expectations of
public opinion,97 and to the new global issues facing both sides of the North–
South divide.98 The AASM countries and those of the British Commonwealth
formed a united front in talks with the Community, overcoming their mutual in-
difference as Anglophone and Francophone nations. As the then-Director-General
of DGVIII Dieter Frisch recalls, Nigeria was to be the leader and main negotiator
for African countries, “strenghened by its oil wealth and membership of OPEC.”99
Determined to obtain some concession to guarantee that the accords did not
simply force the AASM to give away their existing competitive advantage over the
Commonwealth newcomers, the African, Caribbean, and Pacific (ACP) group
subjected the Nine to great pressure in the pursuit of their objectives, in line with
the general demands of the South at that time and the need to obtain more aid
than the previous agreements. This hard line brought the talks to a halt that was
resolved only by a July 1974 meeting in Kingston, Jamaica. Following this meet-
ing, the bloc of new and old associated states obtained important openings on in-
dustrial cooperation as well as guarantees on the stability of income from the

96
J.M. Palayret, “Mondialisme contre régionalisme: CEE et ACP dans les negotiations de la Con-
vention de Lomé,” in A. Varsori (ed.), Inside the European Community. Actors and Policies in European
Integration 1957–1973 (Baden-Baden & Brussels: Nomos–Bruylant, 2006), pp. 369–98.
97
Claude Cheysson joined the European Commission in 1973 and was Commissioner for Devel-
opment until 1981, when he became French Foreign Minister under François Mitterrand.
98
Comité économique et sociale européen (CES), Annexe au PV de la 128ième session plénière
qui a eu lieu les 26 et 27 février, 1975, “Exposé de M. Cheysson,” March 24, 1975. Cheysson believed
the Lomé negotiations were a concrete means of achieving the South’s ambitions regarding global raw-
material agreements. Toward the end of the talks he stated:
This problem can be resolved in two ways: You can hold great ideological debates—which they
certainly don’t lack in the United Nations!—in which everyone defends extreme positions.
Behind the Algerians, who are very gifted at rhetoric and possess a very coherent logic, the Third
World together has assumed ever more aggressive and absurd positions while, at the other ex-
treme, the Americans and a few others decide to ignore whatever recommendations come from
within the United Nations or UNCTAD… If you persist down this path I believe that the world
will proceed toward a series of more troubling commodities crises, with everyone trying to take
advantage of their temporary positions of strength. Or, on the other hand, you can seek to move
forward more modestly but pragmatically. This is what we intend to do.
99
D. Frisch, “La politique de development de l’Union européenne. Un regard personnel sur 50 ans
de coopération internationale,” in (2008) 15 Rapport ECDPM, p. 13.
192 After Empires

export of raw materials. Notwithstanding the hostility of the largest continental

business associations,100 European negotiators accepted the terms fixed by the
future ACP countries with regard to industrial cooperation, even though the plans
they had outlined were quite ambitious: The direct transfer of technology from
European businesses, the training of industrial management on site, and the recog-
nition of the need for a more equitable international division of labor. The Franco-
phone African states also demanded that France renounce inverse preferences,
joining similar pressures from both the other developing nations and the United
States. A determining factor in speeding up the talks was the widespread fear
throughout western Europe that supplies of basic commodities would be cut off in
the event of a failure and the ensuing need for stability of supply. The final product
of these negotiations would be the Lomé Convention, signed in February 1975 by
the European Community and forty-six African, Caribbean, and Pacific nations,
many of which ranked among the poorest nations in the world.
The fact that the Lomé Convention—termed a “convention” and not an “asso-
ciation” to precisely mark the distance from the previous Yaoundé terminology—
opened a new era in the relationship between the developed and the developing
countries was also demonstrated by the approval the Convention received from the
European Community’s Economic and Social Commission.101 The European trade
unions had participated in preparatory discussions, although not directly in the
negotiations themselves,102 and ultimately the ETUC gave its approval, singling
out the innovative character of the protective mechanism to defend the export
income of the forty-six signatory countries.103 Even the French communist trade
union, the CGT, while critical of multinationals’ overbearing weight in the global
economy and supportive of the struggle of the oil producers as a means to redress
global economic imbalances, still admitted that in comparison with the previous
agreements of association, Lomé marked “a new phase.”104 The Italian PCI distin-

100
CES, UNICE, “UNICE Observations de l’UNICE sur le ACP Mémorandum ,” October 29,
1974. In exchange for a commitment to industrial cooperation, European industrialists demanded: a)
protection of private investment; b) free circulation of capital; c) immediate indemnification in case
of nationalization. UNICE observed that the positions previously taken by the South in various inter-
national organizations did not meet these demands, and declared it was unwilling to give away tech-
nology for nothing, warning against using the pretext of transferring manufacturing to certain
associated states because this carried the potential to create a serious social and economic crisis within
the Community. CES, Note de l’UNICE, “Conférence général de l’Onudi à Lima,” March 4,1975.
European businesses underlined the importance of a favorable climate for investment, respect for legal
norms, and suggested their willingness to create joint ventures rather than commit to technology
transfer. They believed the responsibility for the backwardness of the South should be attributed entirely
to the Southern countries themselves.
101
CES, “Parere in merito alla Convenzione di Lomé,” November 19, 1975.
102
J.M. Palayret, “Il Comitato economico e socialize e le relazioni con i paesi e i territori associati
e gli ACP (1958–1985),” in A. Varsori (ed.), Il Comitato economico e sociale nella costruzione europea
(Padua: Marsilio, 2000).
103
IISH, European Trade Union Confederation (ETUC), Box 2928, CES, Letter, “Meeting with
Cheysson,” April 14, 1975.
104
IISH, ETUC, Box 2938, Cgt, “Note du départment international sur la Convention de Lomé,”
February 1976.
 The Year of Oil 193

guished themselves even further from their western European communist counter-
parts by voting their full support for the new agreement.105
Midway through the 1970s, after its first enlargement, the Community had
thus concluded a diverse series of agreements—from preferential tariff agreements
with associated countries hoping for future admission, via agreements on indus-
trial and technological cooperation, to measures to protect export incomes—with
a wide array of countries in northern Europe, the Mediterranean rim, and through-
out Africa, the Caribbean, and the Pacific. It had in fact signed free trade agree-
ments with the Member States of the European Free Trade Association (EFTA);
association agreements with Greece, Turkey, Malta, and Cyprus; as well as the
Lomé Convention with an additional forty-six nations. Between 1976 and 1977 it
signed cooperation agreements with Algeria, Morocco, Tunisia, Egypt, Israel,
Jordan, Lebanon, and Syria which, although falling short of the Global Mediter-
ranean Policy outlined at the Paris Summit in 1972, still represented a major step
toward closer relations with the coastal nations.106 This impressive network of eco-
nomic ties seemed to point toward the emergence of the EC as a new international
actor, with its own regional economic sphere of influence.
At the same time—and all evidence suggests that this was no mere coincidence
but rather a coordinated Franco-German effort, in response to pressure from Great
Britain—the Community began to establish the bases for a global development
and cooperation policy.107
One early sign of the Community’s desire to develop a global approach was the
concession in July 1974 of an exceptional aid package, amounting to 500 million
ECU (European Currency Units), for the countries struck hardest by the rise in oil
prices—the “Cheysson Fund.” It was also certainly no coincidence that, barely one
month after the signing of the Lomé Convention, the European Commission pre-
sented its first five-year plan (1976–80) for technical and financial assistance to

105
M. Maggiorani and P. Ferrari (eds), L’Europa da Togliatti a Berlinguer. Testimonianze e Documenti
1945–1984 (Bologna: Il Mulino, 2005), p. 130.
106
E. Calandri, “Europa e Mediterraneo tra giustapposizione e integrazione,” in M. de Leonardis
(ed.), Il Mediterraneo nella politica estera italiana dal secondo dopoguerra (Bologna: Il Mulino, 2003),
pp 47–59.
107
AMAEF, Direction des affaires économiques et financiers, J.P. Brunet, Voyages-Visites-Rencon-
tres, 1973–4, 60, “Entretiens franco-allemands au Sommet 26–27 novembre 1973. Politique d’aide
aux pays tiers.” The analysis of the French memo, drawn up in the midst of the Lomé negotiations,
was as follows:
The German stance: the Germans rejected inverse preferences and had a more global approach;
they opposed stabilization of incomes from exports; they were against the organization of primary
commodities markets; and placed greater emphasis on the conditions on which aid was given than
on the quantity of aid itself. The French stance: Defense of reciprocity with the “associable” states
to give a definite legal basis to the meetings; the conclusion of agreements with the Mediterranean
countries; a regional policy of export income guarantees. The French were willing, however, once
their conditions had been met, to create a community system for development aid to be open to
all the developing countries.
This document shows clearly how the Lomé Convention represented, in substance, a compromise in
which Germany accepted European regionalism and stabilization agreements, while France resigned
itself to the loss of its inverse preferences as well as the future introduction of a global community policy
for cooperation and development.
194 After Empires

developing countries not associated with the Community.108 In 1976 the Com-
munity approved the financing for its first cooperation projects with non-associ-
ated countries—India, Bangladesh, and Indonesia—as well as the European
program for cofinancing of nongovernmental organizations’ projects for the Third
World. Although initially extremely limited, resources for the programs with non-
associated countries grew at a dizzying pace, from 20 million ECU in 1976 to
approximately 138 million ECU in 1980. The approval of specific Community
legislation in 1981 gave funding of these aid mechanisms a permanent institu-
tional foundation.109
According to The New York Times a rapprochement between western Europe and
the Third World was inevitable, for several reasons:
The European group is much more dependent on Middle East oil than the United
States. However, United Nations analysts point out that other considerations, too,
dictate Western Europe’s flexible attitude toward the third world. These include the
lingering solidarity of the British Commonwealth, the traditional French interests in
Africa, and the influence of strong Socialist parties in Western and northern Europe,
which watch third-world attempts at socialism with sympathy.110
While at the Washington energy conference France had been isolated, even from
its Community partners, this had not prevented the French government from con-
tinuing to support the strategy of dialogue with the oil producers. Both Pompidou
and Jobert, mindful of the fate of de Gaulle whose government had been fatally
weakened by the coordinated blows of the united student and working class move-
ments, feared making the cuts to public services and reductions in labor standards
that would have been necessary to remain competitive in international markets
with the ever-higher costs of oil and basic commodities. Pompidou also believed
that oil prices, which until then had worked to the Europeans’ competitive advan-
tage, could bring continental businesses to their knees in competition with their
American counterparts. The Italian government was equally concerned about any
further rise in the price of oil or other commodities, as they were unable and un-
willing to further reduce labor costs or end wage indexation schemes.111
In September 1974 it was the Saudi Oil Minister Sheik Ahmed Zaki Yamani
himself who proposed once again the idea of a high-level meeting between produc-
ers and consumers on a smaller scale.112 Yamani’s view, and thus that of the Saudi
King Faisal, was that UNCTAD was still too chaotic and radical a forum to pro-

108
“The European Community’s Development Cooperation Policy 1980,” in The Courier,
September–October 1981.
109
Council Regulation 442/81 on financial and technical aid to non-associated developing coun-
tries, February 17, 1981.
110
“Shift in Third World Views Shown in UN Session,” in The New York Times, September 19,
1975.
111
ACS, Moro, Scritti e discorsi 1974, “Articolo per ‘il Sole 24 Ore’,” December 4, 1974.
112
ENI, Estero, Nua 2025, Busta 2026, Ministero Affari Esteri, Dgae–Uff. VIII, “Proposta Minis-
tro Yamani costituzione Comitato livello ministeriale per questioni energia,” Rome, October 2,
1974.
 The Year of Oil 195

vide a space for the discussion of concrete proposals. More profitable results could
be achieved in a committee composed of only four producers—Algeria, Iran, Saudi
Arabia, and Venezuela—and six consumers, foremost among them the European
Community, alongside the United States, Japan, Brazil, India, and Zaire. Yamani
worked diligently within the G77 to generate agreement to this new forum, but he
had to overcome strong Algerian objections to the creation of a forum outside UN
auspices that, furthermore, would include only two “progressive”—that is, anti-
American—producers (Venezuela and Algeria itself ).
The idea of a meeting between producers and consumers was then brought up
again by Valéry Giscard d’Estaing, elected France’s president after the death of
Pompidou. Liberal in his ideological inclinations, but dirigiste in his political train-
ing (in the best tradition of the énarques at the renowned École Nationale
d’Administration), Giscard made two important speeches in 1974 in which he
surprisingly declared himself a supporter of the new international economic order.
In the “Giscardian” worldview, however, the NIEO did not necessarily stand for
the redistribution of resources to the South, still less the creation of a new, interna-
tional legal standard based on a level playing field for strong and weak economies.
More simply, it meant the creation of new decision-making structures for the heads
of those states with enough international authority and power to outline new
guidelines for the stabilization of the international economy on both the monetary
and the energy fronts. As Giscard declared:
Today the global economic situation includes three destabilizing factors. On one side
there is global inflation and on the other the complete disorganization of the interna-
tional monetary system. Finally, there is the swift rise in price of certain commodities,
and in particular petroleum-based products.113
The Giscardian proposal of a restricted, high-level meeting was intended to create
an institutional mechanism to contain the price of oil and negotiate future in-
creases. The producing countries would thus be called upon to give up part of their
sovereignty over the establishment of the price of oil. But in exchange for what?
On this question OPEC was divided into two factions. The first, represented by
a radical Algeria, but also by Iran, aimed to push oil prices ever higher in order to
finance the rapid industrialization and modernization of the poorest and most
populous countries. The Algerian government practiced an economic policy that
went under the definition of “industrializing industries”: Massive investment in
heavy manufacturing concerns, the operational requirements of which would in
turn stimulate the growth of small and mid-sized businesses.114 A second, more
moderate school developed around the Gulf states, less densely populated and
more interested in securing the investment of oil profits than in generating massive
short-term earnings to reinvest on infrastructure. At their head was King Faisal’s

113
S. Cohen and M.C. Smouts (eds), La politique extérieure de Valéry Giscard d’Estaing (Paris:
Presses de Science Politiques, 1985).
114
G.D. de Bernis, “Deux stratégies pour l’industrialisation du tiers-monde. Les industries indus-
trialisantes et les options algériennes,” in (1971) Revue du Tiers-Monde (July–September), p. 68.
196 After Empires

Saudi Arabia, which was acquiring growing prestige in both the West and the Arab
world as a center of Islamic culture, in the process displacing Sadat’s Egypt.115
Faisal could accept a cap on oil prices in exchange for a strengthening of his coun-
try’s political relationship with Europe, and seemed at least partially willing to call
into question its traditional alliance with Washington, particularly after Nixon was
succeeded by the more pro-Israel Gerald Ford.
The determining factor for Paris would be the unanimous support of the Nine
in favor of the initiative. The Italian government led by Moro, as we have seen,
tended to assume a strategy aimed at opening space for the Mediterranean in the
prevailing East–West détente. While prudently taking into account the limited
room for maneuver afforded by the Italian economy, and mindful of the dramatic
fractiousness of its domestic politics, the Moro government appeared the most
open of the Nine to French initiatives.116 From a political perspective only Bonn,
and to a lesser degree the Belgian government, supported the strategy of confronta-
tion set out by Kissinger.
Agreement on a joint Community position for energy matters was thus very
difficult. The communiqué of the Commission prepared by Energy Commissioner
Simonet at the end of 1974 simply sought to mediate among various interests once
more, in order to prevent national supply strategies from putting Member States
in conflict with one another, and to put a halt to the protectionist tendencies on

115
The decline of pan-Arab republicanism and the rise of Saudi hegemony has been traced by Re-
inhard Schulze:
In 1970, more than 80 percent of the oil production in the Middle East belonged to five coun-
tries: Saudi Arabia, Iran, Libya, Kuwait and Iraq. In the same year Saudi Arabia, Kuwait and
Libya earned more through their oil exports than the entire sum of Egypt’s burden of debt. With
this capital, the oil countries could act freely on the world market and import goods in quantities
which Egypt and other countries had never experienced. The wealth produced by oil went against
any development ideology which still believed in a “powerful state” and thus also undermined
the attraction of Arabism, which was closely connected with utopian theories of progress.
Schulze, A Modern History of the Islamic World, pp. 187–8.
116
L. Riccardi, “Sempre più con gli arabi. La politica italiana verso il Medio Oriente dopo la guerra del
Kippur (1973–1976),” in (2006) 6 Nuova Storia Contemporanea, pp. 57–82. The Moro government ap-
peared to be dragged against its will, however, into accepting a more pro-American position. A letter from
ENI president Girotti on the meeting between Kissinger and Moro scheduled for July 1974 revealed the
tension in Italian oil policy, caught between its desire for autonomy and its relationship with the USA:
Let us not forget that Italy’s energy and economic situation is so weak at the present moment that
we are in no position, as I see it, to refuse Western offers of cooperation and reciprocal assist-
ance… Now, if you agree with my judgment and if the widespread opinion is correct that the
Americans have lost some of their original interest in problems of global energy cooperation,
then perhaps it would not be out of place to draw Kissinger’s attention to the interest that con-
sumer nations like Italy have in pursuing the original goals of the Washington Conference [the
Producer–Consumer conference].
ENI, Estero, Nua 2022, Busta 458, Girotti a Guazzaroni, July 2, 1974. But the weakness of Italy’s
energy position—which would have justified cooperation with international oil companies and the
American government—is contested by other ENI executives like Marcello Colitti (in discussion with
the author, October 12, 2006), as well as by documents of the ENI president, in which it appears that
in 1974–5 Italy’s privileged suppliers, like the USSR, Iraq, and Libya, could furnish exports at more
advantageous prices than those of Saudi Arabia. ENI, Estero, Nua, Busta 27, Lettera del Presidente Eni
Pietro Sette al ministra Affari esteri Arnaldo Forlani, December 23, 1976.
 The Year of Oil 197

display. The only feasible options appeared to be reduction in energy consump-

tion, investment in nuclear energy as an alternative source, and re-emphasis on
coal production.117 National energy strategies were simply too diverse and conflict-
ual. But that did not prevent the Nine, despite lacking a clear sense of common
goals, from lining up behind the French initiative as a plan to relaunch the Com-
munity politically on the international stage. The Netherlands was symbolic of the
contradiction in which the Community found itself: While they opposed a Euro-
pean energy policy in order to defend the privileged position of their own oil
companies, the Dutch were strongly in favor of the idea of a global policy to redis-
tribute resources to the developing countries as a means to stem the tide of Third
World radicalism.
The primary obstacle to Giscard’s project lay instead in the White House, which,
after its defeat in the United Nations with the September 1974 approval of the
Charter of Economic Rights and Duties of States, had renewed its openly hostile
stance toward the South.118 The early voices of what would become the neocon-
servative movement were beginning to make themselves heard, calling for the rein-
vigoration of the free market, opposition to unconditional aid for the developing
countries, and a closing of Western democratic ranks.119 One result of their stance
was Kissinger’s menacing expressions at the end of 1974 regarding the need to free
the industrialized countries from the stranglehold of the Arab sheiks, by force if
necessary.
Preliminary French surveys of Washington had revealed the outlines of the Ford
Administration’s strategy regarding the oil question: Negotiating the consumers’
joint position in advance; preventing the producers from obtaining structural
changes in the international monetary system; relying on the inevitable decline of
crude oil prices due to market forces; and emphasizing a preference for bilateral
rather than multilateral talks.120 In the Franco-American summit held in Marti-
nique in December 1974 and dedicated principally to international monetary
issues, the French President struggled to convince his American counterpart of the
need for dialogue with the oil producers. In order to overcome the objections of
Ford and Kissinger, Giscard agreed to reach preliminary agreements in three areas:
Energy conservation, development of alternative energy sources, and financial soli-
darity mechanisms for the West.121 As a result, by January 1975 the industrialized

117
Ufficio per l’Italia della Commissione CEE, “Intervento del vice presidente Simonet in occa-
sione della presentazione dei documenti di politica energetica adottati dalla Commissione,” Brussels,
November 27, 1974. The goals were reduction in oil dependence from 65 percent to 45 percent by
1985; procurement of 50 percent of energy needs through the nuclear sector; and maintenance of the
percentage dependent on coal.
118
H. Kissinger, Years of Renewal (New York: Simon & Schuster, 1999), p. 652.
119
The neoconservative movement was still on the fringes of this uprising, it should be noted, and
even counted the foreign policy realist Kissinger among its primary targets. M. Del Pero, Libertà e
impero. Gli Stati Uniti e il mondo 1776–2006 (Rome & Bari: Laterza, 2008), pp. 363–7; M. Del Pero,
Henry Kissinger e l’ascesa dei neoconservatori: Alle origini della politica estera americana (Rome & Bari:
Laterza, 2006).
120
CHAN, 5AG3, AE 54, Note, November 1974.
121
CHAN, 5AG3, AE 54, Note, “Martinique.”
198 After Empires

countries would create a financial network within the International Monetary

Fund, in addition to the Fund’s existing Oil Facility. Later, on April 9, 1975, a
Financial Support Fund would be created under the auspices of the OECD.
Algeria’s strategy, as expressed by the Minister of Industry Belaid Abdessalam in
the course of the Extraordinary Meeting of OPEC held in Algiers in January 1975,
focused instead on reacting to the attacks of Western propaganda and the media,
as well as threats of American military intervention—judged to be serious—
through a joint declaration of all producers. Abdessalam further declared the need
to move ahead quickly with the first conference of OPEC Heads of State in order
to reconfirm their ties with the other developing countries. Participation in the
French initiative would be acceptable only if negotiations were to include oil, other
commodities, and issues of development at the same time.122 The Conference of
OPEC Heads of State, held in Algiers from March 4–6, 1975, would be the last
high-level meeting organized by Algeria, after the Conference of the Non-Aligned
in 1973 and the VIth Special Session of the UN on raw materials in 1974. In his
opening remarks Boumedienne sought to reiterate and emphasize the connection
between the oil producers’ pressures regarding the price of crude and the establish-
ment of a new economic order.123 The conference approved a series of ambitious
documents aimed at outlining a strategy to solve the international economic crisis
and preserving the role of the oil producers as the vanguard of the struggle for
reform of the international economy.124 On monetary issues, for example, the
OPEC sovereigns and heads of state cited the disproportionate weight of Western
states in both the IMF and the World Bank as evidence “that the policies and ac-
tions of these two institutions are calibrated for the use and consumption of the
political and ideological interests of these States.” The Algerian leader expressed
concern regarding the West’s new strategy aimed at alienating the oil producers
from the other countries of the G77. The Algerian proposals instead included the
complete recovery by Third World nations of their own natural resources, industri-
alization, aid in the form of financial transfers, renegotiation of past debt, and
implementation of the UN “special program” and thus the creation of a Common
Fund for commodities. French diplomats noted, however, that only seven of the
twelve leaders invited were present at the opening, and that the Saudis had already
rejected the idea that all financing from oil producers to the Third World should
pass through a dedicated OPEC fund.125
At the end of March all the conditions were in place for the preparatory meeting
of Giscard’s proposed conference, to be held by April 1975. The approval of the

122
ENI, Estero, Nua 828, Busta 11, A. Fogliano, Promemoria, “XLIII Conferenza straordinaria
dell’OPEC, Algeri 24–26/1/75, Roma,” March 6, 1975.
123
ENI, Estero, Nua 828, Busta 11, Rappresentanza in Algeria, “Algeri: Conferenza dei capi di
Stato dei Paesi membri dell’OPEC,” Algiers, March 6, 1975.
124
Ibid.
125
Archives Groupe Total (TOTAL), 1 Sg/44, Télégramme, “Conference des chefs d’Etat de
l’OPEC, Alger, 7 mars 1975.”
 The Year of Oil 199

Nine had been formally obtained at the EC Council of Ministers on February 10,
and then seconded at the summit in Dublin (March 9–11), at which the Nine had
decided that oil questions and those regarding other commodities would have to
be handled separately. Kissinger’s assent had arrived shortly thereafter, as had that
of OPEC. The preparatory meeting was designed to give form and content to the
actual conference, which would be held upon its conclusion.126 Reporting on the
latest developments to the French President, Ambassador de Guiringaud, who co-
ordinated diplomatic work on the conference, could scarcely hide his satisfaction:
“Eighteen months after the events of October 1973 the dialogue which everyone
first deemed impossible will begin tomorrow because of French initiative.” The
goal of the French government remained that of freezing oil prices and reinforcing
the position of Saudi Arabia within OPEC, perhaps even agreeing to the indexing
of oil prices with that of manufactures. With respect to commodities in general,
however, any discussion of indexing was off limits, because it would create large
surpluses among producers as a result; price stabilization mechanisms for individ-
ual commodity markets could be considered instead. According to de Guiringaud,
the more difficult issue would be to convince Great Britain to accept common
representation for the Nine. But the problems of the preparatory meeting soon
revealed themselves to be much more complex, and brought the entire project to a
temporary halt. Algeria and the United States remained at a total impasse, with dia-
metrically opposed objectives. Algeria feared the separation of OPEC from the
other G77 nations and rejected any Western initiative that might widen this gap.
On the other side of the Atlantic, in a meeting in the Oval Office at the height of
the preparatory talks, Kissinger reported to Ford that “the French President has
been a disaster. The Producers and the Developing Countries are transforming the
meeting into a conference on commodities. I instructed to our delegation to be
tough.” The American President approved: “Well said. You can tell them to come
home.”127
In a report on the final outcome of the meeting, the Secretary General of the
French Treasury allowed himself a few bitter reflections: “The meeting, considered
one of the fundamental objectives of French diplomacy, concluded as a definite
defeat.”128 The European Community had been subjected to the exhausting ritual
of achieving unanimity, forcing the other participants to wait upon the Nine for
hours, while they still were unprepared to negotiate on issues of energy and devel-
opment at the same time. The presence of Viscount Etienne Davignon, in his role
representating both the Belgian government and the International Energy Agency,

126
CHAN, 5AG3, AE 54, Rapport de M. de Guiringaud à M. le Président de la République,
Conference Internationale sur l’Energie et les problèmes économiques qui s’y rattachent, Paris,” March
27, 1975.
127
GFL, National Security Advisor (NSA), Country Files, Europe–Canada, Box 4, Memcon, “The
Oval Office, President Ford, H.A. Kissinger, Brent Scowcroft,” April 15, 1975.
128
CHAN, 5AG3, AE 54, J.L. Lapine, Inspection Générale des Finances, “Réflexions sur la reun-
ion préparatoire à la Conférence proposée par le Président de la République,” April 23, 1975.
200 After Empires

had further made American weight felt in all the Community’s decisions. His as-
sessment of the Nine was telling:
Great Britain: hard line and absence of interest in the conference project;
Belgium and Denmark: hard line, systematically aligned with American positions
and priority accorded to coordination within the Agency (IEA);
West Germany: very hard line on issues of raw materials (for doctrinal reasons) but
made a visible effort to assimilate our ideas;
From the perspective of the image of the Community in the Third World, the bal-
ance sheet of the meeting is rather discouraging: it appeared initially as little more
than the spokesman of the industrialized countries, and was never in a position to play
a role in reconciliation or mediation.
The important role played by the International Energy Agency, while pleasing to
Washington, worried the Europeans: “the shameful label of instrument of opposi-
tion slapped on the Agency by Algeria worries the Europeans even more than the
United States. They would rather not lose the psychological advantage the Com-
munity came away with from the Lomé Convention.”
 6
North–South Dialogues

In August 1975, with the conclusion in Helsinki of the Conference on Security

and Cooperation in Europe, the USA formally recognized Soviet control over
eastern Europe. It seemed weakened by the loss of its Presidency’s prestige and the
defeat in Vietnam, while Congress had rediscovered its never fully extinguished
isolationist tendencies.1 America’s prestige appeared tarnished not only in western
Europe, but also within the country itself. Indeed, in 1975 the Church Committee
of the United States Senate began the largest inquiry ever undertaken into the dark
secrets of a nation’s intelligence services, bringing to light several politically embar-
rassing clandestine operations conducted by the CIA, from its implication in the
killing of Patrice Lamumba to its covert activities against Allende, as well as its
illegal investigations and cover-ups of domestic actions against America’s own
citizens.2
In addition to insisting on a policy of direct confrontation with the oil-produc-
ing countries, Kissinger’s strategy—combined with increasingly strong pressure
from Congress—gradually pushed Washington to withdraw its support for multi-
lateral institutions. The Republican administration delayed payments to the World
Bank and threatened to abandon the ILO and UNESCO, both accused of bias in
favor of the Third World and the communist camp.3 The director of the ILO at the
time, the Frenchman Francis Blanchard, recalled the shock of even British diplo-
mats when in November 1975 Kissinger sent him the letter announcing Washing-
ton’s exit from the ILO, the oldest organization of the international system.4
For its part, the Soviet Union, having reduced economic aid to the developing
countries, seemed to be concentrating on a new military offensive to head off any
competition with Chinese communism. Their actions were so poorly planned and
ultimately chaotic that they produced disastrous results for Soviet foreign policy,
but this made them no less frightening at the time from the perspective of Western
governments.5 Moscow undertook fresh African offensives, in Angola and Ethio-
pia, that seemed to outline the contours of a new effort to achieve regional

1
G.H. Soutou, La guerre de Cinquante Ans. Les relations Est–Ouest 1943–2000 (Paris: Fayard,
2001), pp. 564–5.
2
S. Kutler, The Wars of Watergate: The Last Crisis of Richard Nixon (New York: W.W. Norton and
Co., 1992).
3
C. Gwin, US Relations with the World Bank 1945–1992 (Washington, DC: The Brookings Insti-
tution, 1993), p. 18.
4
F. Blanchard, L’Organisation internationale du travail. De la guerre froide à un nouvel ordre mondial
(Paris: Seuil, 2004), p. 116.
5
J.L. Gaddis, The Cold War. A New History (New York: Penguin, 2005), pp. 206–8.
202 After Empires

hegemony. At the same time they completely abandoned their support for the
economic battles of the Global South, considered by Soviet leadership too costly
and counterproductive, and at any rate to be subordinated to the promotion of
socialist regimes within the developing countries. In a meeting between Leonid
Brezhnev and Carlos Andrés Pérez, the Venezuelan President and one of the most
active leaders of the South, the Soviet leader responded to pressures to raise and
stabilize the price of coffee with the revealing remark: “The cheaper you sell it to
us, the better.”6 The Soviet withdrawal from debates on the global economy would
weigh heavily on their own future, placing them at the mercy of the outcome of a
confrontation negotiated primarily between the West and the developing world.
Thus, neither the United States nor the Soviet Union seemed motivated to dis-
cuss a cooperative path out of global economic turmoil. The mantle of leadership
in international economic diplomacy fell instead upon individual European lead-
ers and the European Community of Nine. The EC had, in fact, emerged with
renewed prestige from the signing of the Lomé Convention and the Helsinki Con-
ference, where it had succeeded in including important provisions in the baskets
holding protection of the right to dissent and cooperation on cultural and eco-
nomic issues with eastern Europe.7 Even more importantly, the EC and western
European countries appeared to have made themselves one of the few attractive
models; and demonstrated this power of attraction by influencing the democrati-
zation of Southern Europe during the crisis of autoritarian and colonial military
regimes in Greece, Portugal, and Spain in the mid-1970s. In 1979 the EC took
also an important step in its own effort to democratize its representative mecha-
nisms, registering some 200 million voters in the first direct elections to the Euro-
pean Parliament.
In the mid-1970s, international diplomatic clashes surrounding currency insta-
bility, development aid, dept repayment, and commodities issues intensified per-
ceptibly. These were all questions that, directly or indirectly, could fall between the
cracks of the delegated competences of the EC and the European Commission.8
France, in particular, long opposed the Commission’s participation on behalf of

6
AHMPRE, 1976, Interior, Visita Oficial del Señor Presidente de la Republica Carlos Andrés
Pérez a Estados Unidos—Gran Bretaña—España—Portugal—Italia—Urss, “Resumen de la conver-
sación sostenida en el Kremlin entre el señor Presidente Carlos Andrés Pérez y el Secretario General de
Partido Comunista de la Unión Soviética, Señor Leónid Ilich Brezhniev,” November 17, 1976.
7
A. Romano, From Détente in Europe to European Détente. How the West Shaped the Helsinki CSCE
(Brussels: Peter Lang, 2006).
8
Pressure for the Community to participate in UN debates had grown steadily after the Paris
Summit of 1972 and in response to the Copenhagen declaration on the identity of the Community
in international relations. In 1973, the European Parliament had voted in favor of a resolution that
requested granting the Community a voice in the UN. In the same year a Commission memorandum
put forward four fundamental reasons in support of EC participation at the UN: 1. the enlargement
to nine countries had given the EC greater political weight; 2. the Federal Republic of Germany’s
admission to the General Assembly meant that all the nations of the Community were now repre-
sented; 3. the Community’s competences were expanding to the point at which it was difficult to
foresee any international debate on economic issues in which the Community did not have a stake; 4.
debates in the UN had ever-greater practical consequences on an economic level. Following these
events the Community petitioned, and in the fall of 1974 was granted, the right to participate in the
UN General Assembly as an observer with the right to speak.
 North–South Dialogues 203

the EC in international negotiations, arguing formally that the Commission did

not represent a state and thus could not negotiate at the same table as other govern-
ments.9 By the end of 1975 the EC and the Commission would defeat this French
resistance, winning the right to participate both in the North–South dialogue ne-
gotiations launched in 1975 and, after 1977, in the summits of industrialized
countries.

G 5, G 6, G 7

With the election in 1974 of Valéry Giscard d’Estaing as French president and
Helmut Schmidt as German chancellor—both former finance ministers, and
members of transatlantic pressure groups—signs of an opening to re-establish
closer cooperation between Europe and the United States were readily apparent.10
Such potential for cooperation was difficult to institutionalize, however, due to the
very different approaches of Europe and the United States to political economy,
and especially because of the widespread fears in Bonn and Paris of the instability
of the dollar. But above all, it would have been difficult to justify any stronger in-
stitutional cooperation with the United States, the main party responsible for the
war in Vietnam and the principal sponsor of Pinochet in Chile, in the eyes of a
European public opinion that viewed Henry Kissinger as the symbol of a diabolical
and antidemocratic foreign policy.11
At the heart of the initiative to gather Western leaders in a forum where they
could discuss major international economic issues without inhibitions or a precise
diplomatic agenda, there was a fear of the potential political breakdown of the
European continent. In the European Community’s southern bloc, authoritarian
or dictatorial regimes had collapsed one after another: In Greece and Portugal in
1974, and in Spain with the death of Franco in 1975.12 In each of these nations
the growing strength and prestige of the left, actively supported by the Socialist
International, allowed progressives to step forward as potential medium-term suc-
cessors to authoritarian governments.13 In Spain popular opposition to the

9
E. Calandri, “La CEE et les relations extérieures 1958–1960,” in A. Varsori (ed.), Inside the Eu-
ropean Community. Actors and Policies in European Integration 1957–1972 (Baden Baden: Nomos/
Bruylant, 2005), pp. 399–432.
10
B. Olivi and R. Santaniello, Storia dell’integrazione europea (Bologna: Il Mulino, 2005).
11
Oriana Fallaci, the famous journalist and writer who would in time become an unreserved
admirer of the United States, began her report on a famous 1972 interview with Kissinger with the
following words: “This too famous, too important, too lucky man, whom they call Superman, Super-
star, Superkraut, and who stitches together paradoxical alliances, reaches impossible agreements, keeps
the world holding its breath as though the world were his students at Harvard.” She concluded with
these biting words: “In Stockholm they even gave him the Nobel Peace Prize. Poor Nobel. Poor Peace.”
O. Fallaci, Interview with History (New York: Liveright, 1976), pp. 17–30.
12
The best account of the ending of dictatorships in southern Europe in the 1970s can be found in
M. Del Pero, V. Gavín, F.Guirao, and A. Varsori (eds), Democrazie. L’Europa meridionale e la fine delle
dittatuer (Florence: Le Monnier, 2010).
13
J.M. Magone, The Politics of Southern Europe. Integration into the European Union (Westport, CT
& London: Praeger, 2003); M. Trouvé, L’Espagne et l’Europe. De la dictature de Franco à l’Union
européenne (Brussels: Peter Lang, 2008).
204 After Empires

Communist party was rapidly declining: While in 1976 only 25 percent of the
Spanish public declared itself in favor of the legalization of the Spanish Commu-
nist Party (PCE), one year later the percentage of those in favor of legalization had
climbed to 55 percent.14 In Portugal, at least in the eyes of Washington, there was
even a very real danger that the “Carnation Revolution” would lead to a commu-
nist party taking power, with all the dramatic consequences that this would have
for NATO solidarity.15 In a demonstration of the generally favorable climate in
Europe for a more regulated economy, the end of the Portuguese dictatorship had
been followed by a wave of nationalizations that brought several key sectors—
electricity, iron and steel, construction, and even beer—as well as the enterprises
of the Melo family, which alone owned roughly 20 percent of the country’s indus-
trial capital, under state control.16 In Greece, meanwhile, the socialist leader
Papandreu was highly critical of his country’s continued membership of NATO,
widely discredited nationally for having backed the previous military regime. In
Italy, as well, the Communists were attracting impressive levels of support that
made it plausible to speculate about a potential electoral triumph over the Chris-
tian Democrats in the 1976 elections, which would lead to communist participa-
tion in a national unity government. This was an even graver danger, considering
the Italian peninsula’s strategic importance to NATO, and the possibly conta-
gious effect of Italian communism on the other countries of southern Europe. In
France, the general secretary of the Socialist Party, Mitterrand, had formed a
united front with the Parti communiste français (PCF), and was making himself
a viable candidate to succeed Giscard. The Scandinavian socialist governments,
traditionally “neutral” in foreign policy and inclined toward a special relationship
with the developing countries, were acquiring growing international prestige and
recognition, represented by a globally authoritative figure in Olof Palme. Through-
out Europe, socialist parties were proposing innovative concepts of political econ-
omy, which included a growing role for the state in the formation of national
income policy and expansion of public services, that were attracting visible elec-
toral support. Fear was in the air that the old continent’s political and economic
center of gravity was shifting to the East. This was the concern expressed by Kiss-
inger, in no uncertain terms, in a 1976 letter to the new president of the Socialist
International Willy Brandt:
I have the duty to express my strong anxiety for the situation that has been created.
The political nature of NATO would be destined to change if one or more of the

14
S. Juliá, “Né riforma, né rottura: Solo una transizione dalla dittatura alla demcorazia,” in (2010)
9 Ventunesimo Secolo October 2010, p. 72.
15
Kissinger actively promoted the return of the Salazar regime out of the fear that a democratically
elected leftist government would strengthen European neutralist sentiment. See M. Del Pero, “I limiti
della distensione: Gli Stati Uniti e l’implosione del regime portoghese,” in Alle origini del presente,
pp. 39–67. The meeting between Kissinger and the US Ambassador in Lisbon Frank Carlucci, who
believed that the democratization of Portugal did not present any danger, resulted in a heated confron-
tation. See B. Gomes and T. Moreira de Sá, Carlucci Vs. Kissinger: Os EUA e a Revolução Portuguesa
(Capa Mole: Dom Quixote, 2008).
16
R.J. Morrison, Portugal: Revolutionary Change in an Open Economy (Boston, MA: Auburn
House, 1981), pp. 47–8.
 North–South Dialogues 205
countries of the Atlantic Alliance should form governments with communist
participation, whether directly or indirectly. The emergence of the USSR as a great
power on the global stage continues to be cause for concern. The role of NATO, like
our unaltered military position in Europe, is indispensable and critical. My anxiety lies
in the fact that these points of strength will be endangered the moment that commu-
nist parties achieve positions of influence in Western Europe.17
Only by reading between the lines of such fears can it be understood why the
Gaullists’ traditional hostility toward the creation of a transatlantic decision-
making structure had been overcome. The United States would have to cooperate
with the major western European powers to overcome the economic crisis, avoid
any retreats behind protectionist barriers, and in so doing avert a fatal weakening
of the European market economy.
First, it was necessary to relax the mounting tensions on the monetary front,
both within western Europe and between Europe and the United States. Exchange
rate flexibility and the constant depreciation of the dollar was destabilizing Euro-
pean currencies, and with them the solidity of the Common Market. By 1970 the
eurodollar market had reached US$57 billion, while the total reserves of the Euro-
pean central banks in American dollars amounted to barely US$37 billion. Under
these conditions, the ability of the central banks to withstand the activity of finan-
cial markets was seriously called into question. Speculative movements of capital
could have destabilizing effects in a regime of flexible exchange rates, while the li-
quidity of the Anglo-American banks was growing exponentially each year with
the constant recycling of petrodollars. All the European governments were tempted
to limit such freedom of movement, a temptation that some were unable to
resist.18
As we have noted, a change was under way in international economic relations,
in which the United States was becoming less central to global production, while
other countries were beginning to emerge as new centers of the world economy.
Robert Gilpin even suggested that the emergence of these new trading nations was
“already having an important impact on the international balance of economic
power and the political economy, an impact that could prove to be as significant as
the emergence of Western civilization as the dominant force in international eco-
nomics.”19 Between 1963 and 1975 the share of total world production repre-
sented by the newly industrializing countries grew from 5.4 percent to 9 percent,
while the United States saw its percentage decline from 37 percent to 35 percent.20

17
The quote, drawn from archival material held at the National Archives, can be found in
P. Popham, “How Britain plotted coup d’état to topple Italy’s Communists,” in The Independent, Janu-
ary 14, 2008.
18
D. Reynolds, One World Divisible: A Global History since 1945 (London: Penguin, 2000),
p. 45.
19
R. Gilpin, The Political Economy of International Relations (Princeton, NJ: Princeton University
Press, 1987), p. 264.
20
J.A. Hart, The New International Economic Order (London: Macmillan, 1983), p. 27. For a par-
ticularly interesting look at the dynamics of the international economy in the 1970s, albeit one cen-
tered primarily on questions of international finance, see R. Parboni, Il conflitto economico mondiale
(Milan: Etas Libri, 1985).
206 After Empires

To cite two very specific and dramatic examples, from 1970 to 1976 Korean
exports grew at a rate of 31 percent per year, and those of Taiwan at 16.2 percent.21
The overall value of all exports from the developing countries grew in the years
immediately following the first oil crisis from US$24 billion in 1973 to US$44
billion in 1977.22 During this same period the economies of the oil-producing
countries also demonstrated enviable growth rates: From a high of 14.4 percent
per year in the case of Saudi Arabia, to the still-respectable 5.3 percent of Vene-
zuela.23 The question facing the largest industrial economies was how to capitalize
on this evolution to their advantage, and avoid the consolidation of an alliance
between these new economies, the oil-producing nations, and the rest of the devel-
oping countries. The creation of the G7 was a direct response to the battle waged
by the Global South to promote a new international economic order, and its desire
to obtain greater participation in international economic institutions. Its objective
was to divide the united front of the South, and at the same time integrate its most
advanced economies into the Bretton Woods institutions, in particular through
the International Monetary Fund.24
The protagonists of the decision—which could be considered as a final Euro-
pean response to the failed paternalism of Kissinger’s “Year of Europe” initiative—
were the French President and the German Chancellor. Schmidt recalled that the
notion of the need for a meeting of Western leaders was formalized during the
course of the Helsinki Conference, in the summer of 1975:
On a bright summer afternoon, sitting around a garden table in Helsinki, therefore,
we made plans for the first summit; so as to keep it from falling into the hands of the
bureaucrats, we agreed to have all preparations made by people we could personally
charge with the task.25
The roots of the G7 lay in the meetings that, beginning in 1973, Schmidt and
Giscard held regularly in Washington with the finance ministers of the United
States, Japan, and Great Britain, which were called the “Library Group.” In the
course of these meetings a strong friendship developed between the liberal con-
servative President and the socialist Chancellor, later described by the former as “a
unique case in the relations among leaders of contemporary nations.”26 A sort of
professional finishing school thus took shape for a Western technocratic elite,
mostly those in high-level national bureaucratic and political offices, but also many
from the worlds of industry and finance. This group would have growing influence
in the coming decades, especially as the ties binding parties to their electorate

21
B. Cumings, “The Origins of the North-Eastern Political Economy: Industrial Sectors and Politi-
cal Consequences, 1900–1980,” in (1984) 38 International Organization (Winter), pp. 1–40.
22
C. Stoffaës, La grande menace industrielle (Paris: Calman-Lévy, 1977), p. 12.
23
World Development Report (Washington: World Bank, 1978).
24
GFL, NSA, Country Files Europe–Canada, Box 9, Memo from Brent Scowcroft, “Your Meeting
with Luxembourg Ambassador Meisch.” See W. Bello, Deglobalization: Ideas for a New World Economy
(London: Zed Books, 2002), p. 55–6.
25
H. Schmidt, Men and Powers: A Political Retrospective, trans. Ruth Hein (New York: Random
House, 1989), p. 173.
26
V. Giscard d’Estaing, Il potere e la vita (Milan: Sperling & Kupfer, 1993), p. 61.
 North–South Dialogues 207

began to weaken.27 An important role in this continuing education was played by

the Trilateral Commission, founded in 1973 by the American financier David
Rockefeller to bring together key American, European, and Japanese business and
political figures.28 Its members included the new American President Gerald Ford,
Giscard, several high-ranking members of the European Community, and influen-
tial businessmen, among them the Italian owner of FIAT Gianni Agnelli, many of
whom had previously participated in meetings of the Bilderberg Group. In a 1974
report focused on the questions regarding the dialogue with the developing coun-
tries, the Trilateral Commission had put forward the argument that the Third
World no longer constituted a homogenous entity: The time had come to speak of
a Fourth World of the newly wealthy, composed of the OPEC nations and the
newly industrialized countries.29 This Fourth World would have to cooperate on a
financial level with the countries of the Trilateral in order to finance those develop-
ing countries that remained mired in a parlous balance of payments. The fear of the
Trilateral was that the predominant reaction to the oil crisis would be one of pro-
tectionism, when what was needed was the continuous expansion of international
demand. Guido Carli, former head of the Banca d’Italia and then of the Italian
Confindustria, and one of the most prestigious members of the Trilateral, em-
ployed an audacious historical comparison to demonstrate the need to circulate
money to avoid the risk of economic decline. The objective, he argued, was to imi-
tate the Italian city-states of the Middle Ages, in order to avoid the fate that had
befallen the Muslim empires at the end of the first millennium:
The expansion of credit in the twelfth century and the multiplication of means of pay-
ment begun by the “white” Italians freed European and international commerce from
its enslavement to gold, and gave global economic development a central motor capa-
ble of sustaining itself: Precisely that which the Muslim Empires lacked.30
The first summit of the new group of heads of state and government (from the
United States, Germany, Japan, Great Britain, France, and Italy) was held from
November 15–17, 1975 in the gilded rooms of the castle at Rambouillet, not far

27
Paul Volcker and Karl-Otto Pohl, for example, who represented Washington and Bonn, would
both go on to head the central banks of their respective countries. One might also cite the example of
Carlo Azeglio Ciampi who, after having collaborated in the preparations for the G7, became Gover-
nor of the Banca d’Italia, Finance Minister, and finally President of the Italian Republic; or Renato
Ruggero who, after acting as sherpa for the G7, went on to head the World Trade Organization and
then briefly the Italian foreign ministry.
28
L. Cesari, “Que disait la Trilatérale?,” in (2000) 1 Revue d’histoire diplomatique, p. 80:
From its creation, the Trilateral Commission understood that the vulnerability of the exchange
rate risked pushing the industrial powers to form, along with certain privileged commodities
suppliers, quasi-autarchic blocs organized around a dominant currency: The United States and
Latin America, Western Europe and Africa, Japan and Southeast Asia. To combat this process,
the Trilateral Commission has never ceased to support the coordination of short-term macroeco-
nomic policy among the United States, the European Community and Japan, as well as a
common approach toward commodities suppliers, and in particular the oil producers.”
29
GFL, Ford Vice-Presidential Papers, OAD, Box 62, Trilateral Task Force on Relations with
Developing Countries, “A Turning Point in North–South Economic Relations,” June 1974.
30
Carli, Cinquant’anni di vita italiana, p. 254.
208 After Empires

from Paris. It focused on a search for solutions to international monetary instability

as well as discussions on how best to respond to the energy crisis and the radical
uprising of the developing countries.31 Italy had been invited to avoid fears, espe-
cially prevalent in Bonn and Washington, of weakening the prestige of the Chris-
tian Democratic leadership prior to its own crucial 1976 elections.
Even before the final crisis of the Bretton Woods system, France had pushed
for a return to the gold standard and a limitation of the dollar’s power of seignor-
age.32 The need for monetary stabilization was reinforced by the constant devalu-
ation of the “greenback” against European currencies, and in particular the
deutschmark, the strongest currency in western Europe—between 1970 and
1979, the dollar lost more than 50 percent of its value against the German cur-
rency.33 The move to flexible exchange and the continuous strengthening of the
deutschmark were placing severe stress on the system of fixed prices for agricul-
tural products set up by the CAP, and made it increasingly difficult for the French
government to resist industrialists’ calls for a devaluation of the franc. France
and Germany ran the risk of being set on a collision course.34 The efforts of the
Committee of 20 of the IMF (which included developing coutries) to come to
an agreement on a system of “fixed but flexible” international exchange rates had
failed. For the Ford administration discussion of the fate of the dollar was an
obligation it could happily have done without, while what truly interested Wash-
ington was a strengthening of the special relationship that bound western Europe
to the United States.35 The Ford administration demonstrated a different sensi-
bility to that of Nixon’s, which had viewed Europe as only one of several theaters
for the exercise of American diplomacy. During the summit agreements were
reached on several monetary issues, albeit not in the direction hoped for by the
French, based on the recognition of a system of “stable but flexible” exchange;
the growing weight of the developing countries in the IMF; and a redistribution
of the Fund’s gold reserves toward the poorest nations.36

31
G. Garavini, “The Battle for the Participation of the European Community in the G7
(1975–1977),” in (2006) 12(1) Journal of European Integration History, pp. 141–59.
32
Soutou, L’alliance incertaine, pp. 357–67.
33
Block, The Origins of the International Economic Disorder.
34
A. Moravcsik, The Choice for Europe. Social Purpose and State Power from Messina to Maastricht
(Ithaca, NY: Cornell University Press, 1998), pp. 264–74; H. Simonian, The Privileged Partnership
(Oxford: Clarendon Press, 1985), pp. 179–92.
35
Kissinger, Years of Renewal, p. 692.
36
The Rambouillet agreements took on greater focus with the meeting of the Interim Committee
of the IMF on January 7–8, 1976 in Kingston, Jamaica. At this meeting several important decisions
were taken: 1. a reduction in the role of gold—the elimination of a fixed price; one-sixth of the IMF
gold reserve would be sold and the income from this sale distributed to the LDCs; one-sixth would be
returned to members according to their share in the Fund; 2. the authorization of a floating system of
currencies, with concomitant changes to the General Agreements; 3. an increase in Fund quotas—
since the last growth in quotas, those that had increased their share the most had been the industrial-
ized countries, while the last increase had most benefited the oil-producing countries. With this
agreement any effort to reform Bretton Woods in the direction of a new system of fixed exchange rates
based on a reserve currency other than the dollar was definitively shelved. See R. Fraser, The World
Financial System (London: Longman, 1994), p. 114.
 North–South Dialogues 209

With one of the most bitter controversies facing the Western nations partially
resolved, the six leaders turned to the fundamental issue: How to react to the vari-
ous processes of global economic and political instability that called into question
the efficient workings of the free market and the capitalist system. The minutes of
that first summit clearly show the desire of Germany and the United States to react
in a coordinated fashion to the assaults of the developing countries, to placate their
antisystemic temptations, and to channel them back toward the market economy,
even at the cost of acquiescing to some of their demands.37 The British Prime Min-
ister Harold Wilson proposed a new “Marshall Plan-type initiative” for the Third
World, with the goal of allowing the poorer economies to recover their purchasing
power, which would constitute “a fillip to world economic recovery from which we
will all benefit.” Chancellor Schmidt, however, repeated in quite a different vein:
“We must find a way to break up the unholy alliance between the LDCs and
OPEC.” Kissinger upped the ante, stating that “this can happen, and we can
achieve our results, if they [the developing countries] know that their disruptive
actions could stop discussions on commodities or that they will pay a price in
terms of cooperation, or military exports.” Similarly, in response to Giscard—who
underlined the need to increase development aid—Schmidt countered that the
fundamental objective should instead be that of including the poor countries into
the market economy in a stable manner: “It is more important that we educate the
developing countries to understand, think, and operate in market economy terms.
We should make them understand that in the long run they can’t spend more than
they earn.” We shall see how the Rambouillet summit paved the way, or can per-
haps be better seen as a parallel initiative, to the launching of the North–South dia-
logue, and thus did not simply represent the realunching of a Western alliance.
Another particularly delicate matter for Western leaders was the growing influ-
ence of the Italian Communist Party, and the communist movements of southern
Europe in general. Even for the mostly liberal editorial pages of the United States’
most prestigious newspaper, the threat of communism in Italy was among the
worst dangers facing the Western economic system, as this November 1975 edito-
rial in The New York Times clearly stated:
If Communist gains in Italy and elsewhere in southern Europe are to be reversed, if
Britain is to be rescued from economic disaster, if France is to avoid a Popular Front
and Portugal a dictatorship of the Left or Right, the industrial democracies must take
joint action to speed, recover and solve urgent problems in the fields of trade, mone-
tary affairs, energy, food, commodities and North–South relations.38
One aspect of the Rambouillet summit that could have carried disturbing conse-
quences for European integration, however, lay in the fact that—in contrast to
what had occurred at every major international economic meeting up until 1975—
the European Community as such had not been invited to participate. A fact ren-
dered even more disturbing because it was in that same year, as we have seen, that

37
GFL, NSA, Box 12, Memcon, “Minutes of Rambouillet Summit,” December 2, 1975.
38
The New York Times, November 16, 1975.
210 After Empires

the Community had emphasized its unity in signing the Helsinki Final Act, and in
the talks preceding the Lomé Convention.
One motive for the exclusion of the Community resided in the fact that West-
ern leaders wanted frank and informal discussions among the world’s foremost
“deciders,” shorn of their bureaucratic minders. The Community’s presence would
have potentially spoiled this template. But the Community’s absence from this
decision-making congress also threatened to weaken its unrepresented countries,
given that the summit promised to deal with issues—such as trade or negotiations
with the developing countries—for which the Community had significant and in
some cases exclusive competence. The White House appeared to be aware of the
problem, but was not willing to press for change of a decision which it believed lay
with European governments themselves.39 The Member States of the Community
that were left out—the Netherlands, Belgium, Denmark, Ireland, and Luxem-
bourg—complained individually, while the French president of the European
Commission, Xavier Ortoli, spoke out about this danger only within the closed
ranks of the College of Commissioners.40 Among the European leaders participat-
ing in the G7, the only one who believed unreservedly in the medium-term goal of
preserving some form of autonomous personality for western Europe in foreign
policy was the Italian Prime Minister Aldo Moro. The Italian government, how-
ever, did not have the strength to force its point of view on others.41
The original idea of the promoters behind the Rambouillet summit was that the
meeting would be a one-time affair. The exclusion of the European Community
was confirmed, however, upon the convocation of a second Western summit, this
time in Puerto Rico, in 1976. At the summit, held from June 27–28, an invitation
was extended to Canada—a key country both in terms of its relations with the
USA and also, as we will see, with the developing countries—but once more not
to the Community. This time, the reaction was quicker and more effective. The
Prime Minister of Luxembourg, then in office as President of the European Coun-
cil, submitted a formal request to the United States to grant the Community par-
ticipation, but his query received no assurances from Washington.42 The “minor”
Member States, or “Little Five,” were up in arms. Even the Commission’s legal
service underlined the dangers deriving from the continued exclusion of the
Community over time.43 The European Parliament added its voice to the chorus of

39
NARA, Declassified Documents Reference System (DDRS), Memo for the President, Secret,
“International Economic Summit Overview,” November 12, 1975.
40
Historical Archives of the European Commission (HAEC), BAC 81/84, “Porto Rico,” Com
(75), Pv 362, sitting of December 3, 1975.
41
A. Moro, L’Italia nell’evoluzione dei rapporti internazionale (Brescia: Ebe Moretto, 1986),
p. 349.
42
GFL, NSA Country Files, Box 9, Memcon, Sonnenfeldt and Ambassador Meisch, “Economic
Summit in Puerto Rico,” June 4, 1976.
43
HAEC, BAC 81/84, Porto Rico, Service juridique de la Commission des Communautés Eu-
ropéennes, “Réunion au Sommet de Porto Rico,” June 11, 1976: “The progress laboriously achieved
on the path to recognition of the Community in all international congresses on economic affairs is still
fragile, and the isolated participation of several member-states in important international meetings,
without the representation of the Community, can only compromise and weaken the credibility of the
Community at large.”
 North–South Dialogues 211

criticism, affirming that “this initiative will endanger the very meaning of the
Community’s institutions.”44
In any case, the Puerto Rico summit did not produce any important decisions
on the international economy, focusing its attention instead on the delicate ques-
tion of how to react to an eventual Communist victory in Italy, a matter in which
the Community itself had very little say.45 It has been said that during the two years
between Rambouillet and Puerto Rico (1975–6), a series of measures contributed
to a definite strengthening of the relations between leaders on both sides of the
Atlantic.46 Certainly these years were critical for the development of the “locomo-
tive theory,” strongly endorsed by the Trilateral, which prescribed an increase in
growth rates and budget spending for those economies running a trade surplus—
Germany and Japan—while the others, foremost among them the United States,
should devote themselves to controlling their growing oil imports, which were re-
sponsible for rising oil prices and weaknes of the dollar.47 This was a form of inter-
national Keynesianism that was aimed at overcoming the ongoing crisis by
stimulating the strongest economies and, indirectly, development aid as well. One
side-effect of this policy would also be to spend the way out of structural reforms
in favor of the Southern countries.48
In 1976 Giscard paid a price for European economic stability, having to replace
Prime Minister Jacques Chirac with Raymond Barre, former Vice-President of the
European Commission, who promptly inaugurated a policy of economic disci-
pline aimed at bolstering the franc and reinforcing the competitiveness of French
industry.49 An astute Italian journalist aptly described this Giscardian attempt to
confront the German challenge, and to impose a new discipline on the French
economic system:

44
“Résolution sur la Conférence au Sommet de Puerto Rico,” adopted by the Assembly at the
sitting on July 9, 1976.
45
GFL, NSA, Memcon, Box 19, Talking Paper with Giscard, Top Secret, “Specific Results of
Proposed Summit Meeting,” May 18, 1976:
A central focal point of a summit discussion would necessarily be the problem of Italy. It will be a
prominent issue over the next several months because of the political and economic implications
of what happens there, especially their significance for the future of the European Community, the
Western economic system, and the Western political and security system. . . However, because a
discussion of the Italian problem does not lend itself to publicity, efforts should be made to avoid
portraying the summit as a meeting focusing on the Italian situation.
A. Varsori, “Puerto Rico (1976): le potenze occidentali e il problema comunista in Italia,” in (2008)
16 Ventunesimo Secolo (June), pp. 89–121.
46
R.L. Garthoff, Détente and Confrontation: American-Soviet Relations from Nixon to Reagan
(Washington, DC: The Brookings Institution, 1994), p. 538.
47
H. James, Rambouillet, 15 novembre 1975. La globalizzazione dell’economia (Bologna: Il Mulino,
1999), p. 172.
48
WBGA, Office of the President, Records of Robert McNamara, General Correspondence, Box 2,
Charles Percy, Committee on Foreign Relations, “Letter to President McNamara,” December 16,
1976: “I believe that what should be proposed is a USA/Germany/Japan packet of fiscal and monetary
measures, coupled with an expansion of monetary flows toward the Developing Countries.”
49
R. Rémond, Notre siècle, 1913–1988 (Paris: Fayard, 1988). Giscard put containment of inflation
at the heart of his program, and compared Barre to General Joffre at the Battle of the Marne.
212 After Empires
Against the presumably triumphant left, President Giscard played his trump card in
Barre. This small, round man, 53, always dressed in black, born on the island of Réun-
ion, has been an economics professor in Paris, advisor to the Bank of France, ex-
Commissioner for the Common Market, director of the Rambouillet Summit, and
Foreign Commerce Minister under Giscard.50
One change that occurred in 1977 was that the much-feared risk of an electoral
breakthrough by the Italian Communists seemed at least temporarily to have
been exorcised. The PCI voted to support the “national solidarity” govern-
ment—though it was barred from active participation, on the explicit request
of Chancellor Schmidt and the IMF—and this ambiguous stance softened the
potentially revolutionary thrust of the party. Hopes were raised, even within the
circles of the Trilateral, by the new doctrine of “Eurocommunism,” which ap-
peared to imply Italian Communists’ definitive break with Moscow. After their
laborious transitions to democratic government, Spain and, at least symboli-
cally, Portugal—where internal conflicts between communists and the far right
had been strongest after the approval of a new democratic Consitution in
1976—put forward their candidacies for admission to the European Commu-
nity. Greek negotiations for EC membership were already under way. Such
developments stood to demonstrate that the Nine exercised a magnetic socioe-
conomic appeal and functioned as an element of political stabilization for its
immediate neighbors.
Another important difference in 1977 lay in the election of two new protago-
nists in international politics—Jimmy Carter and Roy Jenkins—each of whom
had an explicit interest in the consolidation of the European Community as an
international actor. The American President had based his electoral campaign in
part on the idea of a new approach to foreign policy. Together with his National
Security Advisor Zbigniew Brzezinski, Carter had condemned Kissinger’s policy—
characterized by sudden shifts in alliances and tactics, and by privileged partner-
ships with single regional powers—deeming it a form of dangerous improvisation
that could harm the cohesion of the West’s united front. Carter aimed to climb out
of the downward spiral of discredit into which the United States had fallen, not
just in the eyes of the Third World. He undertook inquiries into America’s image
in various regions of the world and altered his administration’s orientation on aid
issues, working on refinancing the World Bank as well as supporting a slight in-
crease in American public aid for development which, between 1976 and 1977,
had witnessed a further decline from 0.25 percent to 0.22 percent of GDP.51 This
overture to the South was sweetened with an emphasis on global working condi-
tions and human rights which raised many eyebrows even within the American

50
A. Cavallari, La Francia a sinistra (Milan: Garzanti, 1977), p. 21.
51
Jimmy Carter Library (JCL), WHCF, Co 2, Memorandum for The President from Brzezinski,
“LDS Views of the US,” November 17, 1977. The memorandum noted that the elites of the Third
World had not the slightest sympathy for the American policy of basic human needs, which was de-
signed to concentrate American aid contributions on food aid and family planning assistance. In the
last analysis, skepticism was still widespread regarding Washington’s real availability to participate in
the construction of a new international economic order.
 North–South Dialogues 213

administration itself.52 The other side of the Carter administration strategy, the
reinforcement of Western cohesion, consisted of reestablishing a special relation-
ship with western Europe as a cohesive region. Zbigniew Brzezinski had been
among the founders of the Trilateral Commission.53 Together with the Democratic
president, he hoped to make the policy prescriptions of the Trilateral one of the
guidelines of American foreign policy:
We assumed office feeling strongly that US–Japanese relations had needlessly deterio-
rated because of the “Nixon shocks” (the unilateral measures imposed by the United
States on US–Japanese trade), and that the Europeans had been pointlessly insulted
by Henry Kissinger’s patronizing proclamation of a “Year of Europe.” In addition,
both the Vietnam War and the Watergate affair had jolted confidence in American
leadership.54
In the aftermath of Carter’s inauguration, Vice-President Walter Mondale called
on Brussels and Tokyo to prepare the next Western economic summit and to dem-
onstrate the seriousness of the new US proposals for cooperation. As the Italian
Bino Olivi, spokesman of the European Commission at the time, observed, “Carter
wanted to speak to Europe, and the only organized structure that could speak for
all of western Europe was the European Community.”55
The other important protagonist to enter the international stage in 1977 was
Roy Jenkins, the first British man to preside over the European Commission, and
one of the rare Labour politicians to earn his fame as a pro-Europeanist: He had
supported adhesion during the British referendum on entry into the EC. By intel-
lectual training he held a global perspective on economic matters—he was also a
fine historian of the British Empire—and was given to expound frequently, and
precociously for the time, on the phenomenon of globalization. He would later say
that he kept his “Europeanist flame” burning in part because, as Home Secretary,
he had never had the opportunity to visit Brussels in all its bureaucratic glory. On
the second stop of his inaugural “tour of capitals” through Europe Jenkins met
with Giscard, with whom he began a diplomatic engagement to obtain direct par-
ticipation at the G7 for the Community, a quest which through highs and lows
would dominate a good part of his presidency.56
In this battle Jenkins was aided by the Dutch Prime Minister Den Uyl. In March
1977, in a visit to The Hague, the President of the Commission had backed the
Dutch government’s strict opposition to the prosecution of international encoun-
ters in which matters which affected the Community were discussed without
Community participation: These included trade issues and the North–South

52
JCL, NSA, Subject Files, Box 67, Memorandum from Mike Armcost to Brzezinski, “Trilateral
Commission Speech,” October 19, 1977.
53
Cesari, Que disait la Trilaterale?, p. 84. For Brzezinski, the Trilateral’s politics were in the best
interests of the United States: “The multiplication of cross-border communications plays to the advan-
tage of the United States, and at the same time that of primary producers of electronic goods and the
headquarters of the largest multinational corporations.”
54
Z. Brzezinski, Power and Principle (London: Weidenfeld & Nicolson, 1983), p. 289.
55
B. Olivi, Carter e l’Italia (Milan: Longanesi, 1978), p. 7.
56
R. Jenkins, European Diary: 1977–1981 (London: Collins, 1989), pp. 19–20.
214 After Empires

Dialogue.57 In the run-up to the European Council in Rome, scheduled for March
25–26, 1977, the French President, who feared upsetting the Gaullists in view of
the upcoming national administrative elections, had revealed his opposition to
Community participation at the London economic summit. He had done this by
sending a detailed letter to his colleagues in which he essentially argued that there
was no need for the Community’s presence in a chat among friends, even if they
were at the highest levels.58 The French missive was the subject of a very harsh
reply, in the form of a lengthy memorandum, from the Dutch government.59 One
of the sharpest points of the Dutch memo was that the European Community
could not be considered simply as an international organization, but rather should
be seen as the embryonic form of a new political community to which its Member
States had delegated part of their sovereignty. With the support of the Commis-
sion, and by now also of the other Member States (with the exception of Great
Britain), the Rome summit established that the Community should be invited to
the next G7 summit in London, with the formula of double representation of both
the Commission President Jenkins and the current President of the Council.
In a trip to Washington from April 15–17, in part to discuss the preparations for
the G7, Jenkins seemed to support the cause of a greater liberalization of world
trade. But he also proposed an ambitious, and ultimately unrealistic, project for a
global Marshall Plan. This would generate sufficient resources for the nations of
the South, he argued, for them to stimulate the Western—and especially the Euro-
pean—economies most dependent on foreign commerce.60
It is perhaps possible to consider the London G7 summit held from May 7–8 as
the last that would produce some results on issues concerning the North–South
confrontation. At the following summit in Bonn in 1978, the G7 plus the EC
moved forward with the practical application of the “locomotive theory.” The Mc-
Cracken Report, presented to the OECD in 1977 with the title Toward Full Em-
ployment and Price Stability, understood the contemporary crisis as the product of
wrong-headed public policies and “avoidable errors,” and saw a solution in govern-
ments’ commitment to economic expansion and full employment. This was still
the position widely prevalent among all the Western governments. The effects of
the 1973 oil crisis were not comparable to those of the 1930s: They did not lead,

57
HAEU, EN, 1611, “Visit in The Hague,” March 1977.
58
HAEC, BAC 39/1986 (0114), “Lettre de Monsieur le Président de la République Française à
Monsieur Roy Jenkins président de la Commission,” Brussels, March 23, 1977:
This is a conference that brings together heads of state and government exclusively, absent every
other institution, for a free and informal exchange of views that cannot lead to decisions on
Community matters. Nothing distinguishes these meetings from the contacts that states nor-
mally maintain with each other bilaterally, and that form the warp and woof of international rela-
tions. . . It has fallen to me, and will continue to fall to me, to attend several meetings of the
Franco-African states, for example, without raising the issue of the Commission’s participation.
59
HAEC, BAC 39/1986 (0114), Europese Raad March 25/26, 1977, “Economiche Top-conferen-
tie te Londen 7–8 mei 1977, Delname EEG aan conferentie.”
60
HAEU, EN 1586, Background papers for the President, “Visit in the United States,” April
12–17, 1977.
 North–South Dialogues 215

in the short term, to the return in force of protectionism, nor to the strengthening
of authoritarian rule in the government of the industrialized countries. Even the
restrictive measures on non-European immigration taken by Germany in 1973
should not be misinterpreted simply as a protectionist and nationalistic device;
they were also seen as a way to better integrate immigrants into German society—
new regulations were in fact enacted for this purpose—and shift the focus to meas-
ures that would improve living conditions in their countries of origin.61
The German government announced in Bonn that it would stimulate its own
economy through expansive fiscal measures equal to roughly 1 percent of GDP.
The Japanese government in turn pledged to increase internal demand in order to
obtain growth in GDP of more than 1.5 percent over the year before.62 These
measures, which in the German case were also aimed at obtaining the approval of
the United States for the ongoing project of a European Monetary System, had
effects very different to those intended. In 1979 a new dramatic oil crisis would
explode, and with it a new phase in international economic relations that would
signal the demise of the pretensions for a coordinated expansion of the largest
world economies on the Keynesian model.

T H E N O RT H  S O U T H D I A L O G U E I N PA R I S

We have seen that in the former Portuguese colonies of Angola and Mozambique,
as well as in other parts of Africa, international communism appeared to be show-
ing signs of renewed vigor and capacity for expansion.63 Castro’s military interven-
tion in Angola had given Cuba new prestige in the Third World, so much so that
Havana was chosen in 1979 as the site of the next conference of non-aligned
countries.
In 1974 and 1975 the IMF had created two new loan programs called “oil facili-
ties,” while between 1976 and 1980 the Fund made available for those struck
hardest by the oil crisis US$3.6 billion through flexible lines of credit with low
conditionality.64 The World Bank had consistently increased its own disbursements
to the poorest countries, in part to satisfy such “basic needs” as irrigation, health-
care, and education, distributing a sum of US$10 billion in 1979 alone. Overall,
the World Bank’s disbursements had grown sevenfold between 1970 and 1980.
Counteracting the effect of the growth in Bank loans, however, was a consistent
decrease in bilateral aid from the OECD countries, which had gradually dimin-
ished aid from 0.65 percent of GDP in 1965 to 0.23 percent in 1979.65 The Bank’s

61
E. Comte, “La formation du régime de migrations de l’Europe communautaire,” doctoral thesis
presented to the Sorbonne, 2009.
62
Available online at <http://www.g7.utoronto.ca/summit/1978bonn/communiqué.html>.
63
P. Gliejeses, Conflicting Missions: Havana, Washington and Africa, 1959–1976 (Chapel Hill: Uni-
versity of North Carolina Press, 2002).
64
Wood, From Marshall Plan to Debt Crisis, p. 78.
65
WBGA, Office of the President, Records of Robert S. MacNamara, Central Correspondence,
Box 3, Memo, “The World Bank—Past, Present, and Future,” August 6, 1979.
216 After Empires

policy was bitterly criticized, by both the Scandinavian nations and the most
progressive countries in the Third World, for the support it gave to regimes such as
that of Pinochet in Chile, as well as for the process through which aid was con-
ceded, which generally tended to favor the return on investment of the industrial-
ized countries through its procurement system. Notwithstanding the efforts of the
Bretton Woods institutions, however, there was still the risk of further radicaliza-
tion in the Third World, of a default on international loans that would send West-
ern financial institutions into bankruptcy, or, at the very least, of vast regions of the
globe cutting themselves off from the flows of trade and international finance.
Washington’s hostile stance toward any dialogue with the South had helped
radicalize the united front of the developing countries, and also progressively dis-
tanced the United States from the position of the European Community countries,
which were more open to dialogue with the supporters of a new economic order.
Washington’s worries were summed up by Egidio Ortona, Italian ambassador to
the United States, in a private letter to Prime Minister Aldo Moro in 1975:
With the creation—under Washington’s “leadership”—of a certain degree of solidarity
among the consumers of the Industrialized Countries, the American Administration
has appeared concerned that European initiatives regarding a more advanced dialogue
with the Third World (Lomé) might end up marginalizing the United States by
accentuating the gap between its position and Third World ideas.66
Significantly, at the meeting in Helsinki where it was decided to organize a summit of
the industrialized countries, Giscard, Schmidt, Ford, and Wilson had relaunched the
failed project of a conference between producers and consumers. The new conference
would be enlarged to include twenty-seven nations (eight developed countries and
nineteen developing countries, including the OPEC nations), and its scope simulta-
neously widened to include issues of development, commodities, and finance, as had
previously been requested by the OPEC countries, foremost among them Algeria.67
In the course of 1975 the American position began to show signs of greater mal-
leability in the area of North–South relations.68 In a long speech at the seventh
Special Session of the UN in September, prepared by Kissinger and read by the
American Ambassador Daniel Patrick Moynihan, the United States—while not
accepting the idea of a Common Fund for commodities and indexing prices of
commodities to manufactures—promoted a number of initiatives around the idea
of increasing the volume of “compensatory aid” to the Third World.69 This was a

66
ACS, Moro, b. 123, Ambasciata d’Italia, Egidio Ortona, Segreto, May 22, 1975.
67
CHAN, 5AG3, AE 54, Présidence de la République, Note pour le Président, “Conférence
d’Helsinki: Déjeuner quadripartite. Questions économiques et financiers,” Paris, July 29, 1975.
68
Kissinger, Years of Renewal, p. 688.
69
“Compensatory aid” was designed to compensate for a structural imbalance in international
economic relations—to plug a hole in the dyke—rather than to eliminate the causes of the structural
imbalance itself. For a description of the American debates on relations with the South see D.P.
Moynihan, A Dangerous Place (Boston: Little, Brown and Co., 1978). A more dispassionate account,
though still critical of the South’s strategy, can be read in the minutes of the debate on the NIEO by
the UN Secretary-General Kurt Waldheim. See K. Waldheim, In the Eye of the Storm (Bethesda, MD:
Adler and Adler, 1986), pp. 112–34.
 North–South Dialogues 217

strategy that Kissinger himself had defined as “appeasement” of the South, aimed
at inundating the diplomatic desks of the supporters of the NIEO with countless
drafts and proposals to discuss, dampening the radicalization of the conflict, while
at the same time beginning the work of re-establishing the fundamental tenets of
international capitalism.70 It is possible to view in this new American strategy the
origins of a series of concrete results for the developing countries in the years
1975–6: The increase in the developing world’s quota in the IMF and the use of
part of European reserves for the LDCs, the tariff reductions for tropical goods in
the multilateral trade negotiations of the Tokyo Round, and the conclusion of two
commodity agreements on coffee and aluminum.71
Diplomatic pressures for the resumption of dialogue with the producers,
however, were primarily coming from the direction of Europe. The assessment
of Commissioner Cheysson—among the protagonists of the Lomé Conven-
tion negotiations—took up arguments similar to those made by Mansholt. To
compensate for the structural deficiencies of the European economy, such as its
heavy pollution and the need to protect the environment, its lack of cheap
manual labor and commodities, as well as the absence of space for industrial
development, the Community would have to count on the emerging countries
to find new markets and ripe opportunities for investment.72 In order to do
this it was necessary to continue to negotiate preferential agreements with the
emerging countries, and to plan in which sectors to increase imports from
these countries. It was essential to identify the European industries in need of
restructuring to favor imports and to collaborate with the unions and business
associations so that such restructuring would not exclusively affect employ-
ment or the living standards of European workers. What was more, as Cheysson
indicated in a report in preparation for the Dublin European Summit of March
1975:
Politically, Europe must play an original role. With respect to its nations, it is freer
from the weight of the past, larger in dimensions; it can be better placed to plan and
bring to conclusion significant original actions. With respect to the other Industrial-
ized Countries, its development and its integration favor the emergence of a multipo-
lar world, less dangerous than a world dominated by the Superpowers, fundamental
antagonists despite their efforts to promote détente. On this point the specific inter-
ests of Europe coincide with those of the LDCs, who want greater balance in interna-
tional affairs.73

70
GFL, CEA, P.W. MacAvoy Files, Box 105, P. MacAvoy, “General Orientation Paper for CIEC,”
December 1975. The economic adviser Paul MacAvoy thought that “the effects of our conciliatory
approach have to at least slow the radicalization of the Third World, a process that could created pro-
found changes in our economic relations and in our national security strategy.”
71
GFL, OEA, L.W. Seidman Files, Box 135, Memo, “OPEC Aid Commitments to Non-Oil Ex-
porting LDCs,” September 20, 1974.
72
HAEC, Cabinet Cheysson, Note personnelle de M. Cheysson, “352ème réunion de la Commis-
sion Promotion du Tiers-Monde,” January 29, 1975.
73
HAEC, Cabinet Cheysson, Préparation du Conseil Européen de Dublin (March 10–11), “Le
problème des relations avec les PVD,” February 10, 1975.
218 After Empires

Following the Community’s modest performance at the preparatory talks for Paris,
the July 1975 European Council meeting concerned itself principally with the
question of how to revive the dialogue with the developing countries. A document
prepared by the Italian presidency let it be clearly understood that the Community
needed to rediscover the spirit of the Paris summit of 1972, when it had declared
its ambition to fill the role of privileged partner to the Third World:
The objective that the Community must pursue, in the prospect of a political purpose
that it must wait to receive from the European Council, is the realization of effective
progress in the direction of a more balanced and equitable structuring of international
economic relations, which includes an improvement and strengthening of the posi-
tion of the Developing Countries, and which responds to their expectations better
than in the past.74
The same document stated that the Community would have to take several steps
toward the G77 on the stabilization of incomes from raw materials and single
product agreements, if it wished to obtain any guarantees for the steady provision-
ing of commodities at reasonable prices.
In certain circles, including that of the French Gaullists, the prospect of a “Eu-
ropean-style” recovery from the international economic crisis never ceased to hold
its charm. This is very clear, for example, in a memorandum by Ambassador de
Guiringaud for Giscard, in which the diplomat—who would soon become For-
eign Minister—viewed the relaunching of the Paris conference as an opportunity
for France to leave behind its more recent provincialism and place itself at the
center of the debate for cooperative management of economic globalization:
The postwar order, founded on the collapse of economic borders, rested on agree-
ments of American design (Bretton Woods—Atlantic Charter) and found its driving
inspiration in New York, which succeeded London as the principal center for inter-
national finance . . . The order needed today should reconcile the right of every gov-
ernment to determine its own national destiny with the advantages of the free
circulation of goods, of capital, of men, of ideas, of technology, in a unified economic
space; it will thus be based on the formula of collective management of global eco-
nomic mechanisms. In this perspective our proposal for institutional innovation fits
perfectly: The creation of restricted and specialized deliberative bodies, within a
larger general design that will guarantee solutions of a progressive and truly multilat-
eral character.75
In May 1975 Joop Den Uyl had traveled to Washington and had opened his meet-
ing with the US President with the reminder that the Netherlands was a “Calvin-
ist country” that in foreign policy sought to stick to its principles, regardless of
their impact on the economy.76 In the second half of the meeting the Dutch

74
ACS, Moro, Presidenza del Consiglio dei Ministri, b. 182, f. 7, Segretario generale, Nota per il presi-
dente del Consiglio europeo, “Materie prime e cooperazione allo sviluppo,” Brussels, July 15, 1975.
75
CHAN, 5AG3, M. de Guiringaud, Rapport à M. le Président de la République, “Réunion
Préparatoire à la Conférence sur la coopération économique internationale,” Paris, October 20,
1975.
76
GFL, Country Files, Europe–Canada, Box 4, Memcon, “Den Uyl, President Ford, Kissinger,”
May 14, 1975.
 North–South Dialogues 219

Prime Minister, backtracking slightly from such high ideals, had more prosaically
reaffirmed that, if until that time their relations with the Third World had re-
mained on an acceptable track, it was not necessarily willing to let the world ex-
plode. The Dutch economy was based on a limited public sector and its businesses
were very open in relation to the rest of the world, on which they depended for the
opening of overseas offices, for manual labor, and for the supply of raw materials.77
The Netherlands had been the most important European target of the OPEC
countries which, after 1973, had cut their supplies of crude oil to its impressive
refineries because of the close relationship the Dutch maintained with Israel. The
Netherlands could not tolerate the risk of a global economic conflict, with the rise
of protectionist sentiments and the closure of borders between the world’s regions.
They were thus well inclined to discuss both the creation of a Commodities Fund
and a generalized moratorium on Third World debt, and in this vein they fought
in favor of the developing countries’ proposals. In November 1975, the Dutch
Minister for Development Cooperation Jan Pronk organized a public seminar,
with the support of all the world’s most renowned experts on development issues,
to discuss the new economic order.78 Pronk re-emphasized the centrality of the
European Community as a progressive element in the United Nations system
compared to countries like Japan—but also the Scandinavian countries and Can-
ada—whose aid disbursements were after all rather limited in absolute terms. The
following year, in a speech before the UN General Assembly, Pronk would also
confirm the Dutch commitment to supporting a different use for development aid
on the part of the World Bank, and a domestic economic policy that would take
into consideration the needs of the poorest countries:
No Developed Country has the right to judge the Developing Countries on social
justice and human rights, unless they are also prepared to put these terms into practice
in their own country . . . This implies a reconversion of industry toward a better inter-
national division of labor, more sobriety in domestic consumption, and a willingness
to apply the theory of “basic human needs” to themselves.79
Even Italy, while lamenting the holding up of important European Community
initiatives to achieve internal cohesion and solidarity among the European coun-
tries—such as the regional fund—gave its unreserved support to a dialogue with
producers as a way to assure steady supplies of commodities. There was substantial
agreement between the Communists and the Christian Democrats on this issue;
their consensus went beyond the characteristically Catholic and Italian rhetoric of
the diplomatic necessity to restart dialogue with the South. Moro and Berlinguer
each expressed respect for Algerian initiatives and called for a political relationship

77
D. Sassoon, One Hundred Years of Socialism: The West European Left in the Twentieth Century
(New York: New Press, 1988), pp. 487–9.
78
Dutch National Advisory Council for Cooperation, “The New Economic Order. Report on the
seminar held at The Hague on November 11, 1975 to consider the implication of the 6th and 7th
Special Session of the General Assembly of the United Nations.”
79
WBGA, Office of the President, Robert S. McNamara, Subject Files, Box 1, Jan Pronk, “Address
by the Minister for Development Cooperation of the Netherlands in the General Debate of the 31st
Session of the General Assembly,” October 20, 1976.
220 After Empires

between Europe and the Arab world: The former, out of a belief in a “slowing of
growth”;80 the latter, out of the conviction that a “qualitative modification of
growth” in the industrialized countries would allow the redistribution of vital re-
sources to the South.81 What Italy was lacking however, in a period of economic
crisis and social unrest, was the resources—particularly in terms of aid for develop-
ment, which in 1977 amounted to barely 0.1 percent of GDP—to make itself a
likely candidate for European leadership in the diplomatic dialogue with the
South.82 With a new social democratic government elected in 1975, Denmark also
became a vocal supporter of a structural adjustment in relations with the South;
Copenhagen thus closed ranks with its Scandinavian partners, such as Sweden and
Norway, which were not members of the EC but were in many ways at the fore-
front of the fight in favor of developing countries, and which had even voted in
favor of the Charter of Economic Rights in 1974.83
At the Rambouillet summit Western leaders had confronted the knotty issues at
the heart of the North–South dialogue in a discreet manner outside the standard
official channels, in order to avoid accusations of having constituted a cabal of the
wealthiest countries—a fear held particularly by the French. On this occasion they
reaffirmed their decision, born at Helsinki, to convene a conference of twenty-
seven nations in Paris. Fundamental differences remained over the role to be played
by the International Energy Agency, which the French did not wish to see given a
voice, and over commodities issues: The United States, Germany, and Japan pre-
ferred to address these by guaranteeing export earnings through improvement of
compensatory IMF financing; Sweden and the Netherlands proposed the enlarge-
ment of a Lomé-type mechanism to include all the G77 countries; France pushed
for the creation of single commodity agreements.84
Giscard’s long-desired conference assumed concrete shape at an October 1975
meeting of the European Community’s Council of Ministers. The event would be
called the Conference for International Economic Cooperation (CIEC), and
would be structured into four commissions—energy, commodities, development,
and financial matters—to include the participation of nineteen developing and
eight developed countries. The Western nations, for whom the numeric ratio
within the CIEC would be more advantageous than within the UN, thought that
they were thus giving life to a new forum to negotiate more favorable oil prices, or
at least to moderate the radicalism of the oil producers. The OPEC countries

80
A. Moro, La democrazia incompiuta. Attori e questioni della politica italiana 1943–1978 (Rome:
Editori Riuniti, 1999), p. 61.
81
E. Berlinguer, La political internazionale dei comunisti italiani, Rapporto al XIV Congresso del
PCI, 18 marzo 1975 (Rome: Editori Riuniti, 1976).
82
A.R. Posner, “Italy and the Third World: Response by an Intermediate Economy,” in P. Taylor
and G.A. Raymond (eds), Third World Policies of Industrialized Nations (Westport, CT: Greenwood
Press, 1982), p. 122.
83
T. Borring Olesen, “Between Words and Deeds: Denmark and the NIEO agenda 1974–1982,”
in H. Pharo and M. Pohle Fraser (eds), The Aid Rush, Aid Regimes in Northern Europe during the Cold
War, vol. I (Oslo: Unipubl, 2008), pp. 145–82.
84
CHAN, 5AG3, AE 54, J.P. Dutet, “Réunion de Rambouillet. Conférence sur la coopération
économique internationale: questions de fond concernant l’énergie, les matières premières et l’aide au
développement,” Paris, November 13, 1975.
 North–South Dialogues 221

would indeed be disposed to concede something on the price of crude, but only in
exchange for Western commitments on the question of a Commodities Fund as
well as the issue of a Third World debt moratorium.
For the European Community the great development to emerge from the CIEC
would be that of common representation, a feat never before achieved in previous
North–South talks. Fundamentally, the achievement of this unity was due to the
efforts of France—which knew it was isolated on oil issues, and thus sought to
emerge from such isolation by encouraging a common European policy in the
energy sector. From the perspective of the OPEC nations, the conditions that
would make the conclusion of a producers–consumers conference worthwhile—
that is, those that would convince the producers to agree to a gradual lowering of
prices—were summarized in overly optimistic terms by the French diplomat Henri
Froment-Meurice:
A degree of political opening in the Arab-Israeli conflict; the renunciation of divisive
tactics in the Third World to separate oil producers and poor consumers; the financing
of current balance of payments deficits and guarantees on earnings from exports; the
return of monetary stability (I have underlined that the Franco-American agreement
at Rambouillet was a good start); and guarantees on the financial surpluses of the Gulf
States and Saudi Arabia.85
The European Council meeting held in Rome at the beginning of December gave
formal approval to convene the conference. The efforts at mediation by Moro and
Italian diplomats had succeeded in defeating British resistance to the joint repre-
sentation of the Nine and, while there was still no consensus on the merits of the
questions to be addressed, it had also put together a list of issues to confront within
each of the four commissions.86 Dutch pressures to persuade the commission on
commodities to discuss explicit “indexing” schemes were turned away thanks to
the unanimously negative response of all the other members of the Community. At
the same time, even France had to accept the presence of the Energy Agency, if
only as part of the OECD delegation. Moro reiterated several times the impor-
tance that the Nine present itself as a common bloc in the talks at the United Na-
tions because, in front of the numerically superior voting power of the South, only
a cohesive group could speak with some measure of authority: taken individually,
the Community’s member-states were only nine against one hundred.87

85
CHAN, 5AG3, AE 54, H. Froment-Meurice, Note, “Entretien avec M. Perez Guerrero et
M. Yeganeh,” Paris, November 21, 1975.
86
ACS, Moro, Presidenza del Consiglio dei Ministri, b. 82, f. 7, Ambasciata Britannica, Lettera a
Moro, Rome, November 11, 1975. In the British letter London requested an autonomous British
representative to be present at the conference, given that it would very soon become the fifth-largest
oil-producing nation in the world—the USSR excluded—and was already the second-largest interna-
tional financial market. The compromise that overcame British opposition to joint representation was
that the Community would accept discussion of a “minimum safeguard price” for oil, an idea particu-
larly close to British (and American) hearts as a means of defending the competitiveness of their more
capital-intensive oil production.
87
ACS, Moro, Presidenza del Consiglio dei Ministri, b. 82, f. 7, MAE, Note sul Consiglio europeo
dell’1–2 dicembre 1975, “Conferenza di cooperazione economica internazionale.”
222 After Empires

The CIEC—which in the future would more frequently be referred to by the

expression “North–South dialogue” or “Paris dialogue” in the international press—
opened with a ministerial conference held in Paris from December 16–18, 1975.
This first round of talks set up the four predetermined commissions (energy, com-
modities, development, finance), each guided by two co-presidents: Pierre Tru-
deau, the flamboyant Canadian Prime Minster who had just created a national oil
company and challenged the special relationship with the USA, for the eight in-
dustrialized countries; and the Venezuelan President Pérez, who had embraced the
cause of the Global South as a way to find new venues for Venezuelan business and
was planning his first historic visit to Castro in Cuba, for the nineteen developing
countries. It was agreed that the commissions would present the results of their
labors during the course of a second ministerial conference to be held in 1976.
The opening of the CIEC was undoubtedly a major success for French diplo-
macy, and offered the chance for the South to exploit the oil weapon to obtain
concrete results in policy areas for which it had fought long and hard for more than
a decade: Reform of commodity markets, control of debt, and improvement in
numbers and quality of public aid for development.
The moment of the dialogue coincided, however, with growing tensions in the
confrontation between North and South. The Western countries, in part because
of the strong contraction in growth registered in the course of 1975 and the con-
sequent moderation of energy consumption, had reduced the deficits in their cur-
rent account balances and transformed them into solid surpluses. The OPEC
nations had received only partial satisfaction of their demands for greater decision-
making power in the financial market.88
A specter was thus emerging, foreshadowed by Algeria’s concerns, of a weaken-
ing in the foundations of the alliance between the OPEC nations and the others of
the G77. The debt of the developing countries had grown from US$9 billion
before the oil crisis to US$35 billion by 1976.89
Conspicuous quantities of capital accumulated from oil sales were, in fact, filling
the coffers of Western financial institutions. In 1979, the bill for the oil purchased by
the non-producer nations of the South had reached some US$39 billion, surpassing
by US$9 billion the total aid the South received from both international development
agencies and individual developed countries. Their debt burden with Western banks,
which in 1973 totaled US$45 billion, had grown to roughly US$190 billion by 1979.
The banks of Wall Street and the City followed their clients wherever they turned in
search of profits greater than those they could obtain in Western economies, focusing
their investments on the most “stable” and promising developing countries. For their
part, countries such as Brazil, Mexico, South Korea, Argentina, or Venezuela were
only too eager to accept international funding at low interest rates.90 Without concrete
measures, the ballooning of debt would erode the South’s united front, forcing several

88
Gilpin, The Political Economy of International Relations, p. 141.
89
CHAN, 5AG3, AE 54, HFM, Note pour le Ministre, “Entretiens avec les représentats des PVD,”
Paris, October 25, 1976.
90
B. Nossiter, The Global Struggle for More. Third World Conflicts with Rich Nations (New York:
Harper & Row, 1987), p. 5.
 North–South Dialogues 223

countries to undergo further industrialization in order to put themselves back into the
good graces of private capital markets, while others would be forced to knock on the
doors of international economic institutions to beg for further financial assistance, no
matter what the political and social cost. The OPEC countries would be openly ac-
cused of starving the non-oil producers. The gravity of the issues at stake was clear to
the new secretary-general of UNCTAD, the Sri Lankan Gamani Corea, who had re-
placed Pérez-Guerrero in 1974.91
At UNCTAD IV in Nairobi, held in May 1976, the G77 strived above all to
achieve the creation of a Common Fund for Commodities as a concrete means
to redistribute resources in favor of the South. They also sought to obtain a
generalized moratorium on debt which, notwithstanding the diminution of
public aid from the West, was growing exponentially primarily as a result of
loans from private capital markets.92 Corea waned that the talks for the Common
Fund would be “the first—and perhaps last—test to measure the validity of the
entire concept of cooperation between producers and consumers in terms of
commodities,” and thus also to measure the practical success of the new eco-
nomic order.93 Kissinger worked hard at Nairobi to promote the American
project of an International Resources Bank, but without success. The Europe-
ans, who did not have joint representation in UNCTAD, were divided: The
Dutch took more “thirdworldist” positions; the French stuck to advocating
single commodity agreements; the Germans displayed an ideological resistance
to any modification of the rules of the free market—determined also in part by
their lack of faith in the CAP, accused of being increasingly costly and wasteful;
while the Italians remained prudently in the background because of their pre-
carious financial situation.94
For their part, the developing countries listed the numerous advantages that a
Common Fund for commodities would create even for the industrialized countries
themselves:95 It would facilitate the creation of single commodity agreements; the
consumer nations would be able to avoid accumulating large reserve stocks of
commodities to guard against lean periods; it would avoid attracting speculation of
private capital on commodities under inflationary conditions; and finally, the Fund
would also imply a limit to the compensatory financial measures conceded by
Western countries to the poorest nations, which in the end were nothing if not
beggars’ alms.

91
G. Corea, Taming Commodity Markets: The Integrated Program and the Common Fund of the
UNCTAD (Manchester: Manchester University Press, 1988).
92
CHAN, 5AG3, AE 54, HFM, Note pour le Ministre, “Entretiens avec les représentants des
PVD,” Paris, October 25, 1976. According to Egerton Richardson, the Jamaican representative to the
CIEC, the LDCs had asked that all IMF gold be restored to them, but that the industrialized countries
had wanted to appropriate the majority of it for themselves: “What were those countries to do that
could not obtain capital on the international market, like Brazil, in order to finance their own develop-
ment or their own survival?”
93
FAO, UN 29/20, Esc, “Comments by UNCTAD Secretary-General,” July 30, 1976.
94
G. Garavini, “L’Europa occidentale e il Nuovo Ordine economico internazionale (1974–1977),”
in (2006) 6 Ventunesimo Secolo (March).
95
CEU, CIEC, Document de travail du Groupe des 19, “Problèmes des marches des produits de
base et expansion du commerce,” March 21, 1976.
224 After Empires

In Nairobi a commitment emerged on the part of the Western countries to study

the question of the Fund and to propose practical solutions at the Paris dialogue.
The Community agreed that a definite position on the issue would have to be taken
before March 1977, date of the closing meeting of the CIEC. One path to a com-
promise solution was outlined in talks between Germany and France prior to the
meeting of the European Council in December 1976. Such a compromise would
have entailed an acceptance by France of an International Fund for Agricultural
Development and the reconstitution of the IDA under the World Bank—reiterat-
ing Western refusal to discuss a general moratorium on debt—in exchange for
German willingness to discuss a Common Fund, if only for a reduced number of
commodities and without the joint consumer-producer management and participa-
tion. But this compromise was never reached.96 In fact, a more interesting proposal
for mediation was put forward by Commissioner Cheysson: His idea was to an-
nounce a special large-scale package for the countries of the South, in exchange for
a guarantee that oil prices would not increase beyond a certain threshold. “This ap-
proach, in its exaggerated simplicity, has a double advantage,” he argued. “It does
not commit us to anything, should oil prices skyrocket; and it puts us on the side of
the countries most damaged by the crisis, along the lines of India and Pakistan.”97
Overcoming some uncertainties, the twenty-seven participants in the North–
South dialogue decided to push back the closing session until the first half of 1977,
waiting for the outcome of the American elections and in the hopes that the new
administration would be more forthcoming than its predecessor. The chief execu-
tive of the French Finance Ministry, Pierre Dutet, made several interesting remarks
on the reasons for this temporary setback to the dialogue.98 First, he reasoned, it
was impossible to ask the West for further aid transfers: That is, to aim for a new
economic order drawing on additional fiscal resources. Second, within the Western
grouping itself there were diametrically opposed ideas concerning the choices to be
made regarding domestic political economy. Third, in an economic crisis it would
be difficult to accept the imposition of sacrifices on all of the various social groups
within the industrialized nations. Fourth, the West, after having made concessions
at Kingston on the World Bank and the IMF, were resolutely firm on the reconsti-
tution of the IDA and impervious to counterarguments for the Common Fund for
Commodities. All the same, Dutet noted, only Europe had been able to jump-start
the compromise and open the dialogue, not only thanks to its much deeper well of
knowledge of the Third World, but also because the perception of crisis within the
Community was much more accentuated than in the United States, owing to the
centrality of foreign trade to its economy, its greater degree of energy dependence,

96
CHAN, 5AG3, AE 54, Chargé de Mission, Note pour le Premier Ministre, “Conférence sur la
Coopération économique internationale,” November 6, 1976. At the their meeting on December
15–16, the Council of Ministers forwarded only the proposal to reconstitute the IDA and the “unty-
ing” of aid, but failed to overcome German resistance and negotiate a Common Fund.
97
CHAN, 5AG3, AE 56, C. Cheysson, Commissaire au développement, Note, December 10,
1976.
98
CHAN, 5AG3, AE 54, M. Dutet, Note, “De l’opportunité d’une relance européenne dans le
dialogue avec le Tiers monde,” December 1976.
 North–South Dialogues 225

and the tougher conditions imposed by its trade unions. If Europe did not succeed
in containing the cost of commodities, and in giving a boost to international com-
merce, then its governments would find themselves forced to follow the dangerous
strategy of salary containment and a potential full-on war with organized labor.
We have already seen how, in terms of the international economy, the strategy
of the new Democratic administration of Jimmy Carter took into account certain
preconceptions of the Trilateral Commission, which had placed a priority on the
coordination of Western positions in their dealings with the developing countries.
The French also noticed, not without concern, the heavy influence that the presi-
dent of the World Bank exerted over the development of the international eco-
nomic policy of the Carter administration, which contained many members in key
positions with strong connections to Robert McNamara.99 It fell to France, espe-
cially, to guide the conference to a positive end; as a result, French prestige would
emerge strengthened, ever more necessary in light of the important administrative
elections that would be held the following year. French experts underlined the risks
of the possible failure of the dialogue:
Of course negotiations will continue in the United Nations, but the Industrialized
Countries must be aware of the political and psychological advantage that the most
progressive faction of the Non-Aligned Movement will gain by defeating the confer-
ence. Supporters for some years of the theory of “collective autonomy”, several leaders
of this movement will be able to convince a growing number of LDCs of the validity
of their ideas and the uselessness of the dialogue with the capitalist West . . .
The CIEC is only one of the forums of the North–South dialogue but, by virtue of
its originality, its defeat will not be without consequences.
European leaders were also aware of the inevitable need to support the purchasing
power of the developing countries, which by now had become strategic importers
of manufactured goods. Tied to this consideration were concerns for the unsus-
tainability of the debtor status of many of these countries. In a meeting of the
European Council from March 25–26, 1977, the French continued to oppose any
discussion of the cancellation or generalized renegotiation of such debt, which also
had the potential to create serious repercussions on a national level, where many
categories of workers were deeply indebted themselves. At the same time, the Eng-
lish presidency put forward again Commissioner Cheysson’s idea of a special action
for the developing countries—also evoking, with some hyperbole, the precedent of
the Marshall Plan—which would simultaneously help the indebted countries and
sustain their purchasing power.100
99
CHAN, 5AG3, AE 53, J. François-Poncet, Secrétaire-Général, Note, “Entretien avec M. Clap-
pier,” Paris, March 17, 1977: “Clappier was dumbfounded by the role played in Washington by
McNamara, whose disciples seemed to hold most of the reins of power: [W. Michael] Blumenthal
(Treasury Secretary); [Richard] Cooper (Under-Secretary for Economic Affairs in the State Depart-
ment); [Anthony] Salomon (Under-Secretary of the Treasury for Monetary Affairs); and [Henry]
Owen himself (Brookings Institution). The result is a significant growth of the World Bank’s influence
within the new administration.”
100
CHAN, 5AG3, AE 56, MAE, Projet d’une note commune Trésor-Affaires Etrangères, Conseil
européen de Rome, March 25/26, 1977. “Dialogue Nord–Sud. Endettemente des pays en développe-
ment et transfert de resources.”
226 After Empires

In the course of the following Council of Ministers in April, the Nine finally put
into place a definite strategy for the conclusion of the North–South dialogue.101
According to its new directives, the European representative would first enumerate
the numerous achievements by the countries of the South in the period from the
oil crisis to 1977. This list included:
1. Reconstitution of the IDA, for a total of US$7.638 billion from 1977–80;
2. general dispositions for an increase in the capital of the World Bank;
3. the December 1975 decision of the IMF’s Executive Council to free up com-
pensatory financing (the sums drawn by exporters of basic commodities had
reached US$2 billion by 1976);
4. the January 1976 increase in IMF quota-shares for the OPEC countries
(while at Kingston another agreement was reached in which part of the sales
of gold would be employed to finance a fund for countries with balance of
payments problems);
5. the goal of a US$1 billion international fund for agricultural development,
reached in 1976;
6. three agreements on basic commodities (ethane, coffee, and cocoa) put into
practice in 1976; and
7. reduction of excise tax on tropical products, which would be applied by the
Community beginning on January 1, 1977.
The Community’s directives were completed by two important decisions that
were the result of a compromise between Germany and France. First, the Com-
munity committed itself to financing a special action of some size as a form of
additional aid for the poorest countries. In exchange, in an important German
concession, it also agreed to undertake a study of the concrete application of a
Common Fund with its own resources or, alternatively, of an income stabiliza-
tion mechanism for the sales of several basic commodities—which for Schmidt
held the important advantage of not entailing any alteration of their established
prices.
A genuine effort at coordination on the issues of the North–South Dialogue
took place at the G7 summit held in London in May 1977. At this point, even
from the French perspective, concerns of a political nature clearly took prece-
dence, and explained the need to make the CIEC a success, not simply as a new
way to obtain an agreement on the price of oil and bring together a more stable
new economic order, as much as a means to take ground from beneath the feet
of the Soviet Union. From Giscard’s perspective, every Western country should
apply pressure, on the bilateral level in those parts of the world where they main-
tained privileged relations, and multilaterally through close coordination in in-
ternational organizations—with the obvious exception of NATO, which in the

101
CHAN, 5AG3, AE 56, Communautés Européennes, Le Conseil, “Directives à l’intention des
représentants de la CEE (Résultats de la session du Conseil du 5 avril 1977),” Luxembourg, April 5,
1977.
 North–South Dialogues 227

Third World was viewed as a repressive instrument.102 The poor countries’ debt
was, from an economic point of view, the primary Western concern. The Ameri-
can strategy, considering that the majority of its UNCTAD proposals would be
rejected, was based on a globalization of aid around the creation of a “world
development budget.”103 This included a reorientation of aid, directing it toward
the poorest countries, and a specific line of credit from the IMF for “newly in-
dustrialized countries” such as Brazil and Mexico.104 In a letter to President
Carter,105 Schmidt confirmed German refusal of a Common Fund for commodi-
ties, which would favor the United States, Australia, and Canada, and reiterated
his objections to indexing and to any mechanism that implied a direct transfer
of resources. Germany could accept a system based on that of Lomé, which
would guarantee earnings from the export of certain commodities.106 Both Wash-
ington and Bonn understood, however, that to oppose communist propaganda
and maintain the openness of the Western system of commercial exchange, it
was vital to demonstrate that only the existing international economic institu-
tions could provide concrete solutions to the South’s problems. The London
summit thus closed with an encouragement in its final declaration to continue
the discussion on the Common Fund, but only as a tool to regulate single prod-
uct agreements, thus not fully endorsing the demands of the Southern
countries.107
The final session of the CIEC was held shortly thereafter, from May 30–June 2,
1977. Its results were less than expected, from the perspective of both the Western
nations and the developing countries.108 Agreements were reached on:
1. the need to ensure the transition to alternative energy sources;
2. acceptance in principle to the creation of a Common Fund for Commodi-
ties, to be placed under UNCTAD management;

102
CHAN, 5AG3, AE 53, Secret, “Interventions déstabilisants de l’Union Soviétique hors
d’Europe.” The note was prepared to brief the French President for the secret meetings of four that
would be held on the margins of the London Summit.
103
WBGA, Office of the President, Record of Robert McNamara, General Correspondence, Box 2,
Henry Owen, “A World Development Budget: Issues for the Summit,” March 5, 1977. The invest-
ments in non-OPEC nations totaled approximately US$150 billion. Of these, one-quarter came from
bilateral aid, one-quarter from multilateral aid, and one-half from private capital—export credits,
direct investment, loans. The newly industrializing countries received three-quarters of all world in-
vestments in the LDCs, and almost all private capital.
104
CHAN, 5AG3, AE 56, J.P. Dutet, Note pour le Président, “Conférence de Londres (7 et 8 mai
1977). Relations avec les pays en voie de développement,” Paris, May 4, 1977.
105
JCL, NSA, Brzezinski Material, Correspondence, Box 6, Letter by the Federal Chancellor,
“Non-Paper on the Economic Questions of the London Summit (May 7 and 8, 1977),” Bonn, March
8, 1977.
106
The openness of the German Chancellor to a system for stabilizing export incomes was
confirmed at the end of 1978 in a summit jointly organized by Schmidt and Manley of Jamaica and
including progressive—but reform-minded—countries from the North and the South: Australia,
Canada, Nigeria, Norway, Venezuela. 5 AG 4, 4273, Note, “Un premier Sommet Nord–Sud: la réun-
ion de la Jamaique (décembre 1978),” Paris, September 30, 1981.
107
Available online at <http://www.g8.utoronto.ca/summit/1977london/communiqué.html>.
108
CHAN, 5AG3, AE 56, Froment-Meurice, Circulaire, “Conférence ministérielle de la CCEI,”
Paris, June 8, 1977.
228 After Empires

3. an increase in the volume of aid from the industrialized countries—Japan

announced it would double its efforts within five years, while the American
Secretary of State Cyrus Vance declared the USA would commit to a
“substantial” increase;
4. a special action totaling US$1 billion; and
5. access for the developing countries to Western capital markets and invest-
ment guarantees.
The developed countries did not manage to obtain a commitment to the crea-
tion of a forum to discuss energy problems, a project which was even opposed
by Saudi Arabia, the most moderate of the oil-producing countries.109 In the
analysis of the French Minister for Foreign Affairs, the reason for the break-
down of the talks could be found in the long-term interests of three groups of
participants: The OPEC countries sought simply to maintain political consen-
sus on an increase in oil prices; the poorest countries wanted to exploit the oil
weapon to obtain precious advantages in terms of aid and power within inter-
national organizations; and the West wanted to divide the South. Some still
believed, however, that considering the growing importance of the developing
countries as importers of manufactured goods, the only solution remained the
implementation of a courageous “Marshall Plan” to redistribute resources to the
South and increase commodity prices. This would be a convenient solution,
considering that “after Bandung a number of nations had emerged strength-
ened by the collapse of colonial empires. The Third World of 1955 was much
more revolutionary than the Third World of today. There is still room to
negotiate.”110
Struck by the economic crisis, those theories that called for a more equitable
international division of labor based on collaboration between developed and
developing countries were quickly losing credibility. In essence, the end of the
North–South dialogue marked a transition from the concept of a new economic
order based on North–South conflict, to more benign notions of “interdepend-
ence” that implied concessions needed to be made by both sides. Proposals for
redistribution of profits in favor of the poor economies, through a debt mora-
torium, and the Common Fund for Commodities, had been discussed and
largely rejected. The international stature of the European Community was
growing: It had outgrown its merely regional influence to take on some respon-
sibilities in global politics, but it had not succeeded—or had not wanted—to
push harder to obtain structural changes to the international economy. Rather,
it was the United States that had succeeded in retaining a central position in the
international monetary system, through the recycling of petrodollars, while the

109
ENI, Estero, Nua 978, Busta 27, Lettera del Segretario di Stato per l’Energia britannico Tony
Benn al Commissario Cee Guido Brunner, “Visit to Saudi Arabia 19/20 April 1977,” May 3, 1977.
110
CHAN, 5AG3, HJB 1, J. de Lipkowski, “Le dialogue Nord–Sud—échec ou Partie Remise?
Pour l’instant l’impasse.”
 North–South Dialogues 229

weakness of the US dollar continued to undermine the solidity of the Common

Market.
With the arrival of summer 1977, the priorities of the Community nations and
the European Commission itself began to lie elsewhere. The urgency of their need
to play an international role began to subside, as attentions were focused inward:
On the potential means to overcome the internal troubles of a European market
that seemed to be stuck, given that trade with the wider world was growing faster
than that inside the Community; on the search for solutions to the alarming loss
of competitiveness of traditional European industries; on closing the gap between
the economic policies of those countries with strong and those with weak curren-
cies; and on preparations for enlargement to include the southern European coun-
tries, which could constitute a new stimulus for the internal market. Renato
Ruggiero, an Italian diplomat who took part in the closed meeting in East Endred
at which Roy Jenkins launched the Commission’s new strategy—which would
later lead to the birth of the European Monetary System—has furnished eye-
witness testimony to the emergence of this new political climate and its changing
priorities:
I can provide a first-hand account of how the plans for the EMS were born, the first
drop in the long story that ends with the common currency . . . I was the spokesman
for the then-president of the European Commission, Roy Jenkins, and, with a few
others, took part in the meeting at his home at East Endred in Wales where the strat-
egy was decided upon. It was 5 August 1977 . . . At East Endred we agreed that the
customs union was beginning to show deep cracks: Internal trade within the Com-
munity was growing slower than that with the outside, and the competitive currency
devaluations—that of Italy above all—were destroying the fabric of solidarity with the
European Community. There were two positions on how to proceed. The first wanted
to jump-start European industrial policy: Massive public financing of the economy.
The second, strongly supported by Jenkins, aimed at reestablishing monetary cohesion.
We decided that this was the right path to follow.111
On October 27, 1977, in a speech at the European University Institute in Fiesole,
outside Florence, Roy Jenkins officially launched the new strategy of monetary
union.112 The project planned for economic expansion through priming the inter-
nal market, an increase in Brussels’ budget to pump oxygen into the lungs of Eu-
rope’s poorest regions, as well as a spur to speed up the passage toward European
political unity. The monetary initiative desired by Jenkins, later realized by Giscard
and Schmidt with the establishment of the European Monetary System (EMS) in
1979, was developed principally to fight against inflationary tendencies by placing
the deutschmark at the center of the European system of exchange, creating a
barrier against monetary shocks coming from outside the Community, and kick-
starting the internal market, which would also favor a growth in employment. The
significance of the EMS should not be overemphasized: It did not represent, as

111
Corriere della Sera, May 5, 1998.
112
P. Ludlow, The Making of the European Monetary System (London: Butterworth Scientific, 1984).
230 After Empires

Jenkins apparently intended, the economic counterpart to the direct elections of

the European Parliament, and a contribution to the deepening of European
political unity. In a memorable speech behind closed doors at the Deutsche Bun-
desbank just before the meeting of the European Council to ratify the EMS,
Schmidt deployed several arguments to persuade German bankers to approve the
monetary agreement: First, that the Common Market needed a boost in exchange
stability; second, that Germany’s impressive economic expansion and social stabil-
ity had to be protected from the envious reactions of its partners by deepening the
links with the EC and NATO (“the more successful we are in the areas of foreign
policy, economic policy, socioeconomic matters, and military matters,” he noted,
“the longer it will be until Auschwitz sinks into history”); and finally, that there was
the need not to lose strategically significant countries such as Italy:
You really only have to look at the internal political development in some Member
States. I have a friend in Italy called Giulio Andreotti. I may not relate what he tells
me in every time of trouble about his internal political landscape. But the mere men-
tion of his name and the idea of internal political relations there must be enough for
each of us to imagine that, if we float further apart, nobody can keep Italy in the po-
litical alliance. What that could signify in relation to Yugoslavia and the Soviet Union
and to the situation in the Mediterranean, I must not depict here.113
If the EMS mechanism represented a notable contribution to the maintenance of
the Common Market, particularly in its linkage of the Germany economy to all its
weaker partners, it could also run the risk of symbolizing a return of more modest,
and primarily regional, ambitions for the European Community.

W I L LY B R A N D T A N D G L O B A L S O C I A L D E M O C R A C Y

The European Community was not the only western European actor or institution
with the desire to design an international role for the continent through its dialogue
with the non-European world. There was indeed another mainly European body
with a larger membership than the EC, a much more agile institutional organiza-
tion, budget, and legal framework, and similar or even more grandiose ambitions.
A stronger and wider Socialist International could have been an important
forum in which to confront in a coordinated manner the economic transformation

113
Margaret Thatcher Foundation (<http://www.margaretthatcher.org>), Archive, Archive (Bun-
desbank) “EMS: Bundesbank Council meeting with Chancellor Schmidt (assurances on operation of
EMS),” November 30, 1978 [declassified 2008]. Another quotation from the same speech revealed the
new-found sense of confidence of German leadership:
When we wanted to extradite from France a lawyer—Croissant, the man was called—who lent
encouragement and help to terrorists, what a revolt! When a poor old man—Kappler, he was
called—escaped from an Italian military hospital with the help of his by no means young wife, and
perhaps a third person helped, what a revolt in Italy, what accusations: Rebirth of Fascism. All silly
stuff, all nonsense. But here manifests itself this mix of inferiority in respect of the great German
success, which then reverts to the memory of crimes that were committed in the name of the
German people forty years ago, more than thirty-two, thirty-one years ago, that still represents us.
 North–South Dialogues 231

in western Europe, to respond constructively to the criticism of the developing

countries, and to combat the wave of authoritarian and antidemocratic movements
growing across the Third World.114 Among its members were many influential
political leaders, heads of state, and of governments, from Brandt to Palme, from
Leopold Senghor to the Jamaican Michael Manley. It also aimed to exert pressure
on international organizations and organize the activities of its several million
members and sympathizers.
The organization, whose headquarters was and still is in London, had gone
through a period of acute difficulty between 1974 and 1976. In the final months
of his mandate, the Austrian President Bruno Pitterman had been compelled to
leave office with a grave illness. Its last congress had been held in 1972, and since
then congresses had been postponed twice, first in 1974 and again in 1975. Be-
tween 1975 and 1976, socialist leaders had only had occasion to meet thanks to
the initiatives of their respective parties: There were nine such meetings between
socialist leaders during this time, always outside the formal machinery of the
International.
At the opening of its thirteenth congress in 1976, the Socialist International was
an international political organization composed of thirty-six member parties from
across thirty-one nations, counting some eight million militant members and rep-
resenting an electorate of tens of millions, almost all of them from within the de-
veloped world. These figures were even more significant when it is recalled that the
communist movement was in the midst of a profound crisis stemming from the
tensions between its two major powers in Asia, along with a dissident Eurocom-
munism that probably represented only the latest insidious challenge to Moscow.
In the Third World, the International retained very little prestige, because of its
tight connections with the Atlantic partnership and NATO: All told, in the devel-
oping countries it could count on a little more than a million voters. Between 1973
and 1974, Kreisky undertook three missions to the Middle East representing the
International, which charged him with identifying a regional strategy. By 1975 a
stronger awareness of the significance of the North–South dialogue seemed to be
discernible in the European socialist parties. In February, at a conference of party
leaders, Brandt openly recognized the North–South dialogue’s importance, while
the Dutch representative affirmed that the theme of relations between developed
and developing countries would have to become central to socialists’ foreign policy
strategy:
We must come to terms with the difficult behavior of certain countries in the United
Nations. The “majority” today is not the American bloc, but the Third World. Are we
ready to accept a global transfer of power? If the answer is yes, we can open a construc-
tive dialogue. We must support the international agencies and the dialogue with con-
viction, even if it had sometimes had negative origins.115

114
On the evolution of the Socialist International before its XIII Congress see IISH, SI 264, Gianni
Finocchiaro, “Una svolta dell’Internazionale socialista al XIII congresso,” January 1977.
115
IISH, SI 346, Report of Proceedings, Party Leaders’ Conference: West Berlin, February 22,
1975.
232 After Empires

At the Geneva Congress of September 22–23, 1976, Willy Brandt was elected
President of the Socialist International on the strength of a program that emphasized
the importance of peace and respect for human rights, and that above all under-
lined the need for greater economic cooperation between wealthy and poor na-
tions. The order of the day, in a phrase coined for the occasion, was “we work for
the survival of Man and of Mankind.” Olof Palme’s protégé, the Swede Brent
Carlsson, was elected Secretary-General.
Brandt’s election to the presidency was not only a demonstration of the ever-
more influential weight of German social democracy,116 but also of a strong left-
ward tendency in international socialism, which was oriented toward countering
the global crisis of capitalism with state intervention, regulatory control over pri-
vate enterprise, and cooperation with the developing countries. With these aims
in mind, the Congress approved a sixteen-point declaration on international eco-
nomic solidarity. The declaration, jointly presented by thirty-seven parties, traced
the origins of the global economic crisis to the “failure of international capital-
ism,” provoking a rather spirited reaction from the German Chancellor Schmidt,
who did not approve of his party’s strategy within the International and thus dis-
tanced himself from the resolution.117 The Chancellor instead highlighted the
responsibility of governments in power—including those with socialist majori-
ties—that allowed citizens to live beyond their means, failed to address economic
policy, and underestimated the structural problems afflicting industry. For
Schmidt, the crisis did not allow leaders to indulge in facile ideological solutions.
A public works program to achieve full employment would simply aggravate in-
flation, so Schmidt instead proposed to place a priority on control of the money
supply. A voice like that of the Chancellor, however, was extremely isolated in the
socialist galaxy at the time, and strongly opposed even within his own German
social democratic party.
The Geneva Congress was closely followed in the Western press. Attention was
focused on the possible expansion of a new political movement, Eurosocialism,
which had already demonstrated great potential to attract votes in Greece and
Portugal, and seemed capable of similar success in Spain. In the upcoming direct
elections to the European Parliament, Eurosocialism would soon show itself to be
the strongest political grouping in the European Community.118
During the Brandt presidency, the International focused on identifying the ele-
ments of an economic strategy to escape the crisis of the 1970s. The organization
could not make binding decisions for its members, but it could encourage dialogue
on the most pressing issues, rather than waste time—as it often had until then—on

116
IISH, SI 293, Bureau’s Report, “Draft Introduction,” confidential. Germany had recently in-
creased its contributions to the organization, from £11,668 in 1975 to £12,834 in 1976. In 1976
British Labour and the German SPD paid the same amount, the PSF £3,416, the Swedes £8,162.
In1977 the total contributions of the SPD took off, reaching £35,502 out of the International’s total
budget of £120,000.
117
G. Braunthal, The West German Social Democrats, 1969–1982. Profile of a Party in Power (Boul-
der, CO: Westview Press, 1983).
118
O. Todd, “Let’s Not Forget Eurosocialism,” in Newsweek, November 29, 1976.
 North–South Dialogues 233

sterile ideological debates attempting to distance itself theoretically from

communism.
In September 1977, the International promoted a global conference on energy
held in Marseilles. In his opening remarks, Carlsson declared that the spirit of the
initiative would be to promote greater horizontal cooperation between the compe-
tent sections of socialist parties, and not simply between leaders: “Until now, not
enough time has been spent on discussing the fundamental problems that the in-
ternational workers’ movement must face in what remains of the 1970s and in the
1980s—such as unemployment, the environment, energy, democracy, and work-
ers’ education.”119 Even though no specific solution was identified at Marseilles, the
principal indication to emerge from the debates there was that any energy policy
would have to go hand in hand with the fight against unemployment and for social
justice. The danger, feared by the Franco-Austrian André Gorz, was that an “ecol-
ogy of the rich” would simply render a certain level of consumption out of reach of
the poor, because energy would become too costly.120 Energy efficiency was, in-
stead, a goal to be achieved out of respect for the principle of social equality, a
concept which closely resembled the austerity promoted by the Italian communist
Berlinguer:
The assets that consume the most energy, such as cars, boats, houses, summer homes,
private jets, are more common among persons with large incomes.
Energy efficiency must thus be combined with a policy leveling incomes and for-
tunes. Otherwise energy efficiency will mean nothing more than the creation of a so-
ciety permanently divided into classes.121
A second point of reflection for the Socialist International concerned multina-
tional corporations. In a 1975 address, the Finnish socialist Paavo Lipponen—who
would later become Prime Minister from 1995–2003, the height of the “Nokian-
omics” era—called for deeper analysis of the role of multinationals, more consist-
ent cooperation between European countries in this sector, and a strengthening of
the role of the state in the economy:
Capitalism is now obsolete historically as the dominant form of social and economic
organization. There is a growing demand for public control of the economy through-
out the capitalist world, even in the United States. The famous liberal economist
Galbraith himself, in his latest book, called for a “new socialism.”122

119
IISH, SI 381, Brent Carlsson, “Opening statement at Socialist International energy confer-
ence,” Marseilles, September 22–23, 1977.
120
As cited by Serge Latouche, La Repubblica, July 13, 2008:
The decrease in growth and productivity, which in another system could be a positive develop-
ment (fewer automobiles, less noise, more breathable air, shorter working days, etc.) will instead
have completely negative effects: Polluting products will become luxury goods, inaccessible to
the masses, but will remain within the reach of the privileged; inequalities will increase, the poor
will become relatively poorer and the rich richer.
121
IISH, SI 381, “Memorandum on the Socialist International Conference on Energy Policies,”
Marseilles, September 22–23, 1977.
122
IISH, SI 408, Paavo Lipponen, “Social Democratic Parties and the Multilateral Corporations.”
IUSY Seminar on multinational corporations, Helsinki, November 21–24, 1974, February 21, 1975.
234 After Empires

It was decided to convene a study group on multinational corporations that would

meet in Rome beginning in June 1977. The group, headed by the Belgian Oscar
Debunne, would prepare a draft resolution for the congress to be held in Vancou-
ver in 1978. There were already several international organizations that were trying
to construct a legislative cage to contain the anarchic growth of multinational en-
terprises: The ICFTU, UNCTAD, the European Council, the OECD, the Euro-
pean Parliament, the ILO. If the initiative of the Socialist International thus fit
well within the spirit of the age, it was still particularly incisive because many of its
component socialist parties were currently in power, and their cooperation could
have generated concrete legislative proposals. The final report of the study group
on multinationals argued that private capital should be flanked by a strong public
sector and listed several measures that could help states maintain their authority:
National representation on managerial boards; full access to information for gov-
ernments and unions; legal protection of union membership; encouragement of
industrial democracy.123
The third object of Brandt’s initiatives and energies, which he pursued with
particular intensity, was the North–South dialogue. In 1974 the Club of Rome
had entrusted the Dutch socialist Jan Tinbergen with compiling a report on the
necessary reforms for the international economic system. His massive study, fi-
nanced by the Dutch Ministry for Development Cooperation, was completed in
1976.124 It called for the democratization of international economic institutions,
the achievement of alimentary self-sufficiency for the poorest countries, and for
automatic capital transfers to the South to reach the long-targeted 0.7 percent of
GDP of the developed countries. The report was warmly received by several devel-
oping countries and, even though it was largely ignored in the West, it deeply
concerned Robert McNamara, for it heavily criticized the policies of the World
Bank and aired the prospect of international socialist aid-planning independent of
the great economic institutions based in Washington.
At the beginning of 1977 it was McNamara who proposed to Brandt that they
create a high-level commission with the aim of studying measures to reduce the
ever-more visible economic gap between the rich and poor countries. The idea was
to create a body along the lines of the Pearson Commission, this time with less
direct involvement on the part of the World Bank, that could determine the neces-
sary volume of aid, especially for the poorest countries, and the required changes
in the policies of the developing countries, as well as discuss the structural modifi-
cation of the international economy.125 Out of consideration for the fact that the
Bank was criticized by both the right, which deemed it a bottomless well of waste-
fulness, and the left, which saw it as the accomplice of antidemocratic Third World
dictatorships, it was the Dutch government that declared itself willing to finance

123
IISH, SI 408, Ken Martin, British Labour Party, “Multinational Corporations. Socialist Inter-
national Special Committee. Report by the Working Group.”
124
J. Tinbergen (ed.), Reshaping the International Order (New York: E.P. Dutton Co., 1976).
125
WBGA, Office of the President, Robert S. McNamara, Subject Files, Box 1, “Prospects of the
Brandt Commission,” 1714/77.
 North–South Dialogues 235

the majority of the costs so that the Commission could present itself as an
independent body in the eyes of world public opinion.126 Brandt nevertheless had
to wait until the end of the Paris conference of the CIEC to make the first convoca-
tion of his commission. And even then he then personally had to convince both
Houari Boumedienne and the Secretary-General of UNCTAD that the conference
was not a maneuver to avoid structural reforms, distract from the debate over the
Common Fund for Commodities, or win publicity for the West’s standard rhetoric
calling for greater development aid and sermons on the need for population con-
trol in the poorest countries.
The constitution of the Brandt Commission was announced on September 28,
1977 and quickly raised the hopes of those frustrated by the failure of the North–
South dialogue.127 An early draft by the Swedish economist Goran Ohlin, Brandt’s
principal collaborator, argued the need to highlight the many differences among
the various countries of the South as one of the possible outcome of their investi-
gations, as well as to explore issues such as arms control and the environment.
At the end of 1977 and throughout 1978, the prospect of some form of collabo-
ration between the World Bank, the European socialists under Brandt’s leadership,
and the Democratic administration of Jimmy Carter in the United States seemed
genuinely possible.128 Soon, however, the head of the World Bank began to worry
about the slippery slope down which the Commission’s debates were threatening
to lead. When, in his opening remarks, Brandt spoke of a new Sudpolitik, McNa-
mara realized that the German social democrat risked being perceived as too
“European,” and thus out of sync with the feelings of the US Congress, where the
entire question of arms control and its linkage with an increase in development aid
was politically explosive. The essence of Brandt’s experiment, as outlined his ad-
dress to the meeting of the Commission at Mont Pélerin in March 1978, appeared
to be marked by a refusal to accept the concept of interdependence: “If one expects
a new international order to be characterized by more justice one should not expect
too much from such concepts as ‘interdependence’ and ‘globalism’ in the near
future. Such concepts must not deflect attention from the fact that the sovereignty
of the new states must in many cases first be given real content.”129 This new world

126
WBGA, Office of the President, Records of Robert S. McNamara, Minutes 1976–1981, Box 2,
“President’s Council Meeting,” November 18, 1977.
127
Members of the Commission included Willy Brandt (Germany), Chairman Abdulatif Y.
Al-Hamad (Kuwait), Rodrigo Botero Montoya (Colombia), Antoine Kipsa Dakoure (Upper Volta,
today Burkina Faso), Eduardo Frei Montalva (Chile), Katherine Graham (United States), Edward
Heath (Great Britain), Amir H. Jamal (Tanzania), Lakshmi Kant Jha (India), Khatijah Ahmad (Ma-
laysia), Adam Malik (Indonesia), Haruki Mori (Japan), Joe Morris (Canada), Olof Palme (Sweden),
Peter G. Peterson (United States), Edgar Pisani (France)—later replaced by Pierre Mendes (France),
Shirdath Ramphal (Guyana), and Layachi Yaker (Algeria). Ex officio members included Jan Pronk
(Netherlands), Goran Ohlin (Sweden), and Dragoslav Avramovic (Yugoslavia).
128
IISH, SI 972, “Letter to Willy Brandt,” April 5, 1978: “The Administration, in general, wants
to cooperate with European socialists on this and on other problems. Brzezinski understands the im-
portance of cooperation, and Robert Hunter at the White House will follow his lead.”
129
Cold War International History Project (CWIHP), permission of the Woodrow Wilson Center
for Scholars, “Paper by the Chairman of the North–South Commission, Brandt, for the Meeting in
Mt. Pélerin,” 11 March 1978, AdsD, Nord-Sud-Kommission, 3. Berliner Ausgabe, vol.8.
236 After Empires

order, no longer merely economic in nature, also encompassed issues of human

rights, disarmament, and defense of the environment on a level parallel with
economic issues:
This requires that international public opinion and the community of nations accept
the decision to achieve a balanced reduction in armaments expenditures and link it to
an overproportional increase in development expenditures.
The exceptionally high input of scientific and technical expertise claimed by arma-
ments production, represents an intolerable wasting of human resources.
In practice, though without ever saying so openly, Brandt was outlining the con-
tours of a new “global social democracy.” The Vancouver Congress of the Socialist
International, held from November 3–5, 1978, was completely taken up by the
North–South dialogue. Carlsson presented a report for the occasion on the most
significant developments of the Brandt presidency.130 The International had broad-
ened its contacts with the Third World. A delegation led by Olof Palme had been
sent to South Africa. A second delegation, headed by the Portuguese Prime Minis-
ter Mário Soares, had traveled throughout Latin America to shed light on the need
to develop regional solutions for the continent. The Marseilles energy conference
had proposed the widening of economic democracy to big business, in part as an
instrument to influence their decisions on energy policy. The overall balance sheet,
however, remained shaded in chiaroscuro: So many different efforts had been un-
dertaken, and yet the actual successes of European socialists remained primarily
confined to the southern rim of Europe. The representative of the Jamaican gov-
ernment reminded all, in alarming terms, of the damage that would be done to
cooperation with the Third World if the North–South dialogue did not soon pro-
duce any concrete results:
When I listen to the Industrialized Countries argue that it is politically impossible to
pursue economic growth because it will force rates of inflation to rise by 2 percent, or
preach about the political necessity to raise protectionist barriers toward the Third
World to maintain rates of unemployment below 6 percent, we must ask ourselves if
they realize the terrible inequality of the situation.
The concrete danger exists of an overturning of the process of internationalism that
has been built in these last few years, and of the retreat of many poor nations into
isolationism, or into opportunistic bilateral relations free of all principles.131
While major roles were played in the creation of the European Monetary System
by Chancellor Schmidt and the British Labour Party member Roy Jenkins, the
president of the European Commission who originally launched the initiative, in
1978 European socialism was still generally reluctant—if not openly hostile—to
further deepening of European integration. There was a very strong tendency
among European socialists to look for a way out of the economic crisis, from infla-

130
IISH, SI 409, Socialist International Congress, “Report by Brent Carlsson,” Vancouver, Novem-
ber 3–5, 1978.
131
IISH, SI 409, Richard Fletcher (People’s National Party, Jamaica), “North–South Relations.”
Speech at the Vancouver Congress, November 3, 1978.
 North–South Dialogues 237

tion to unemployment, simply through workers’ participation in business, the

strengthening of the cooperative movement, and less bureaucratic management
of public and private enterprise, perhaps through wider employment of the system
of autogestion. Sartre could still argue in 1977, without fear of criticism, that the
European Community was an instrument of capitalism, and that the close collabo-
ration then under way between Germany and the United States would destroy any
project for a socialist Europe.132
Michel Rocard, probably the most charismatic French socialist leader after Mit-
terrand, a future prime minister and a refined writer, was part of that grassroots
movement against the Common Market, because he believed further opening of
markets would have impeded a serious industrial policy while favoring delocaliza-
tion and the weakening of workers’ solidarity. Rocard was not opposed to Euro-
pean integration per se, which he believed remained an ambitious international
project, but hoped sincerely to see a socialist Europe: “What we call the building
of Europe is in reality, yes, against nationalism, but at the same time against Europe
itself in the name of free enterprise.”133
This tendency, which called for some kind of protection against the free market,
was woven even more deeply into the sinews of Labour in Britain than in France.
Tony Benn, Minister for Industry in 1975, was convinced of the need for the wider
use of planning, even if this should have been placed increasingly under the direct
control of the trade unions rather than the state. From his most recent experience
in government, Benn declared he had learned that:
[e]x-Imperial Britain was now apparently meekly accepting the status of a colony or
protectorate, whose economic policy was dictated by the International Montary Fund;
whose industrial policy by the multinationals; whose foreign and defence policy was
integrated with NATO and whose statutes were only legal if they did not breach the
provisions of the Treaty of Rome as interpreted and administered by non-elected of-
ficials in Brussels known as the Common Market Commissioners.134
Even Bettino Craxi, elected Secretary-General of the Partito socialista italiano
(PSI) in 1976 and destined soon to become the first socialist to lead the govern-
ment of postwar Italy, had distanced himself from Italian communists by celebrat-
ing the heritage of the critics of Marx and the community-based utopian socialism
of Proudhon, and remained silent on the virtues of competition and market
forces.135
Such deeply-held hopes for a socialist Europe, to be achieved above or around
Brussels and the Common Market through the success of socialist parties in their
respective countries, were captured in this report by a representative of the Swedish

132
Cavallari, La Francia, p. 63.
133
M. Rocard, Le marché commun contre l’Europe (Paris: Seuil, 1973). The book’s subtitle included
the declaration “socialism will be European or it will cease to be” (“le socialisme sera européen ou ne sera
pas”).
134
T. Benn, Arguments for Socialism (Harmondsworth: Penguin, 1980), p. 17.
135
A. Landolfi, Storia del PSI. Cento anni di socialismo in Italia da Filippo Turati a Bettino Craxi
(Milan: SugarCo, 1990), p. 338.
238 After Empires

metalworkers’ union, in an analysis which again did not differ greatly that of the
Italian Eurocommunists:
An economically independent Europe could find a third way between communism
and capitalism. This would require, however, the progress of the socialists through the
electoral success of the left in the upcoming elections. European socialism does not
mean only greater influence in the economy for organized labor, but also a greater
liberty in foreign policy. For Eastern Europe an independent socialism in Western
Europe would create the prerequisites for its liberation from the Soviet Union. Euro-
pean socialism would thus establish the foundations for a new relationship with the
Developing Countries and for a New International Economic Order.136
François Mitterrand’s electoral success in 1981 seemed capable of contributing to
the establishment of a socialist Europe and at the same time advancing the North–
South dialogue. Under the coordination of Lionel Jospin, before the elections the
French Parti Socialiste had articulated a policy toward developing countries cen-
tered on the reform of international economic institutions and development aid.137
Once elected, the French President named Régis Debray—a friend of Ernesto
“Che” Guevara and bard of the Cuban revolution—as special assistant for Latin
American affairs. The entire Socialist International was basking in the victory of
the Sandinistas in Nicaragua in 1979. Mitterrand instructed his sherpa Jeannenay
to ensure that the next G7 summit to be held in Ottawa, Canada would be dedi-
cated to North–South relations. At the same time, Foreign Minister Claude Chey-
sson was charged with proposing a New Deal for the South at the upcoming
OECD ministerial conference.138 In view of the 1981 Ottawa G7 summit, the
European Commission itself, through the French Commissioner for Development
Cooperation Edgar Pisani, appealed to the Member States of the Community to
side openly in favor of global negotiations with the South, which would be held in
Cancun, Mexico that same year. Pisani affirmed that, for the countries of the
South, Europe was their final hope, and that both they and the African states
aligned with them were showing the first signs of a discouragement that could ul-
timately lead them to revolt against the agreements reached at Lomé.139 To combat
this trend he begged that “Europe must impose upon its partners, especially the
United States, its own vision of the world.”
There did not seem to be great support for the idea of an autonomous Europe as
a partner to the Third World, however, neither within governments—with the
exception of the socialist France of Mitterrand—nor among their electorates,
which would soon opt for a more marked Atlanticism, as in the Germany of the
CDU and Helmut Kohl. Certainly, there was scant interest from those social and
economic forces that were beginning to experience the sting of their first defeats at

136
IISH, Si 409, Jan Olsson (Swedish Metal Workers Union), “An international industrial policy,”
July 7, 1977.
137
Les Socialistes et le Tiers Monde. Elements pour une politique socialiste de relations avec le Tiers
monde (Paris: Berger Levrault, 1977).
138
R. Dumas, Affaires Etrangères 1981–1988 (Paris: Fayard, 2007), p. 16.
139
E. Pisani, “Communication to the Council, North–South dialogue on the eve of the confer-
ences of Ottawa, Cancun, Nairobi and Paris,” in (1981) 69 The Courier (September–October).
 North–South Dialogues 239

the hands of organized industry. At the beginning of the 1980s there was a great
flourishing of projects: “Marshall Plans” for the South, “New Deals” for the devel-
oping countries, even a “world employment plan.” These initiatives, at once ambi-
tious and overheated, rapidly accelerated growing frustrations with their inability
to act in a concrete manner and effect real changes in the dynamics of the interna-
tional economy.140
Brandt submitted his own report to the Secretary-General of the United Na-
tions in 1980. The questions it raised would be discussed in detail in a dedicated
international summit to be held the following year.141 The Brandt report explored
complex problems with an abundance of statistics and quantitative data. While
incredibly detailed, a single unifying thread tied together its disparate analyses: The
idea that between North and South there were common interests, and that recipro-
cal relations should be regulated through well-rounded forms of cooperation both
political and economic in nature. The goal was to promote a progressive détente in
global political relations, a reorganization of the military–industrial complex, and
a massive flow of international aid aimed at financing not the acquisition of arms
but a change in the qualitative development of poor countries to guarantee their
alimentary self-sufficiency. The report put forward the proposal of a tax on inter-
national trade and the export of armaments, while it set the quantity of resources
needed to be transferred to redress North–South inequality at a figure of US$50–
60 billion per year. In Brandt’s vision an important role awaited Europe, which
would have to develop its own personality autonomous from both East and West.
Brandt’s address found a warm welcome among Dutch citizens and an impor-
tant foothold in the Italian Communist party. Relations between Italian commu-
nists and several European socialist leaders—among them Palme, Mitterrand, and
Brandt himself—had grown closer during the 1970s.142 It was from reading
Brandt’s report that Berlinguer drew several key analytical points that would help
him develop the Charter of Peace and Development, which the Italian Commu-
nists would formally present at the UN Special Session at Cancun in 1981. The
Charter, the fruit of lengthy discussions that began in 1979 and involved more
than 100 economic specialists,143 expressed sympathy with the Brandt report’s rec-
ommendation of the need for Europe to maintain an autonomous role. The Italian
Communists underlined that the new Reagan administration aimed to exacerbate
the North–South conflict as part of an aggressive strategy to revive American capi-
talism and escape economic stagnation by stimulating military spending. Europe
alone would have to continue to favor détente and push for a world regulated by
norms to protect both the strong and weak alike. The Italian Communist Romano
Ledda, presenting the Charter to the PCI’s Central Committee, stressed that “the
reversal of current international trends is therefore consonant with the general

140
IISH, SI 409, J. Tinbergen, J.M. Den Uyl, J.P. Pronk, and W. Kok, “A New World Employment
Plan,” October 1980.
141
North–South: A Program for Survival, The Independent Commission on International Develop-
ment Issues (Cambridge, MA: MIT Press, 1980).
142
Maggiorani and Ferrari (eds), L’Europa da Togliatti a Berlinguer, pp. 53–75.
143
Author’s conversation with Renato Sandri, October 2005.
240 After Empires

interests of Europe, which coincide with the goal of a democratic and pacific evo-
lution of international political and economic relations.”144 Fiamma Lussana sum-
marized the Charter’s proposals for Europe:
The European Community will gain a great advantage from economic interdepend-
ence because it depends for a large part of its energy and commodity needs on the
global South. For Berlinguer, as for Brandt, Europe can play a positive role in the solu-
tion to the North–South relationship in at least three ways: Overcoming the logic of
bilateral agreements with commodity-producing nations and seeking to develop a
common policy; undertaking a productive reorganization that is reciprocally advanta-
geous with the Emerging Countries; promoting a development policy in depressed
areas of the world that employs its great scientific and technological resources and
applies them to modernization and structural reform programs.145
The convergence between Eurosocialism and Eurocommunism—which however
seemed to be increasingly identified solely with the PCI—in their conception of
the international economy was still highly theoretical, and blocked by the immov-
able obstacle of Italian communism’s international position in the Cold War. And
in any event, it was of very short duration.146
For suddenly, in one of those quick turns in the course of history that make the
study of the past alternately frustrating and rewarding, precisely at the moment in
which the convergence of many leaders of the European left seemed at its peak,
European governments, their citizens, and workers found themselves forced to
cope with a second devastating oil shock and with a revolutionary change in US
monetary policy. Its aftermath revealed unequivocal signs of the decline of the
Keynesian economic paradigm and the exhaustion of the cultural wave unleashed
on the European continent by 1968, helped to revive the Cold War, and provoked
the definitive rupture of the united front of the Global South.

144
R. Ledda, L’Europa fra Nord e Sud (Rome: Editori Riuniti, 1989), p. 339.
145
F. Lussana, “Il confronto con le socialdemocrazie e la ricerca di un Nuovo socialismo nell’ultimo
Berlinguer,” in (2004) 2 Studi Storici (April–June), p. 568.
146
S. Pons, Berlinguer e il fine del comunismo (Turin: Einaudi, 2006).
 Epilogue
Managing Globalization

In 1978, surrounded by the oppressive grey climate of a Red Brigades’ prison cell
and a few weeks before being found dead in the boot of a red Renault 4, the Italian
Prime Minister Aldo Moro—known for his hermetic style, now only accentuated
by clear-headed pessimism over his isolation—expressed his deep disillusionment
with Italy’s and western Europe’s future possibilities for autonomy:
Faced with multiple requests about the social and economic structures of the Europe
of tomorrow, and with them of Italy, I must honestly say that what one is about to
witness is the reinvigoration of the capitalist means of production on a technocratic
basis, obviously tempered by modern techniques of efficiency …
This way of being, of a Europe tightly bound to and conditioned by America, will
not change, in general, with an alteration in the internal order of its various countries,
as one sees in the equal faith given to both Labour and Conservative governments [in
Britain].1
Just a few months later, in March 1979, the British Ambassador to Paris Sir Nicho-
las Henderson sent his final despatch to the Foreign Office, a document that was
quickly leaked to the press and provoked heated debates in the UK.2 Titled “Brit-
ain’s Decline; Its Causes and Consequences,” the despatch was full of praise for the
success of France and Germany in shaping the European Community, and of equal
contempt for the failures of a British foreign policy that had missed its chance to
lead Europe right after the war, “when every western European Government was
ready to eat out of our hand.” In Henderson’s analysis, for Britain to find a new
sense of national purpose, it should not abandon diplomatic give-and-take on
issues like the CAP, but should behave “as though we were fully and irrevocably
committed to Europe.” The only way to modernize British industry was in fact to
adopt more of the French and German models of management and labor relations,
and commit more political investment to the European integration project.
The oil shock of 1973 had only ended up reinforcing a number of tendencies
already present in both western Europe and the international arena. Within west-
ern Europe governments had developed models of social democratic planning that

1
A. Moro, Ultimi scritti 16 marzo–9 maggio 1978 (Casale Monferrato: Piemme, 1998), p. 55. Aldo
Moro was held prisoner for fifty-five days and wrote in this period various letters and a “memorial,”
the complete authenticity of which is highly contested.
2
MTFA, “The Henderson Despatch,” March 31, 1979. Available online at <http://www.margaret-
thatcher.org/document/110961>.
242 After Empires

widened the public sphere, refined forms of collaboration between labor unions
and business management, made an effort to integrate migrants—while limiting
their numbers—and undertaken experiments in greater direct popular participa-
tion. At the same time, the European institutions in Brussels had been significantly
reinforced: Initially through the creation of the European Council in 1974, and
later with the first direct elections to the European Parliament in 1979. New Euro-
pean policies had been introduced, from regional funds for less-developed areas in
the continent, to the global development and cooperation policy, to new forms of
European political cooperation raising the Community’s profile in international
relations. The major European political parties were weaving a tighter web of alli-
ances at the supranational level, thus reducing the relative weight of national
embassies in the conduct of intra-European affairs.
Western Europe, and the European Community in particular, had graduated
from dragging its feet on international economic cooperation in the 1960s, to
become its spearhead in the following decade: The 1971 approval of the General-
ized System of Preferences; the ambition to play the role of “most favored” partner
of the developing world at the Paris European summit in 1972; the declaration on
European identity and the launching of the Euro-Arab dialogue at the Copenha-
gen European summit in 1973; the joint signature of the Nine on the Final Act of
the CSCE, the Lomé Convention, and the simultaneous launching of the G7 of
industrialized countries and North–South Dialogue in 1975.
By the beginning of the 1980s, and as a consequence of the twin oil and mon-
etary crisis in 1979–80 that proved to have far more momentous consequences
than the first in 1973,3 the future of western European integration was all but clear.
Would Aldo Moro’s warnings about persistent European dependence on US-driven
capitalism prove correct? Or would ambassador Henderson’s remarks on the
strength of the French and German economic models, as well as on the inevitable
reinforcement of the European integration project, be confirmed?

T H I R D WO R L D S

In 1979, two years after the conclusion of the North–South dialogue in Paris, the
developing countries seemed even more united and radical than at UNCTAD I in
1964. The extremism of the South was clearly displayed at the 1979 Non-Aligned
conference in Havana, under the presidency of Fidel Castro. On that occasion the
Third World vociferously echoed its previous accusations against an industrialized
world that had refused, in its view, to grant it meaningful concessions. Similarly
radical positions were expressed that same year in the course of the G77 ministerial
conference at Arusha, Tanzania, the final document of which criticized the indus-
trialized world’s protectionism, denounced conditional aid, and called for global

3
On the various consequences of global 1979, see Frank Bösch, “Umbrüche in die Gegenwart.
Globale Ereignisse und Krisenreaktionen um 1979” in (2012) 1 Zeithistorische Forschungen, available
at <http://www.zeithistorische-forschungen.de/site/40209215/default.aspx>.
 Managing Globalization 243

negotiations at the UN to confront the issues surrounding debt, the Common

Fund for commodities, and the reform of development aid simultaneously. Equally
radical was the tone of many speakers at UNCTAD V, held in Manila in May and
June 1979. Few international observers failed to notice, however, the many increas-
ingly large fissures in the South’s united front.4 One researcher for Italy’s IPALMO,
which throughout the 1970s had regularly analyzed the evolution of debate over
the new economic order, highlighted their contradictory priorities:
For the oil-producing nations possessing a surplus, financial questions [are a priority];
for the LDCs that have demonstrated substantial industrial development, a new regu-
lation of international long-term credit, facilitated access to capital markets, maximi-
zation of free trade in manufactures in the markets of the Industrialized Countries,
and facilitations for transfers of technology; for the less developed, along with the
urgency of a solution to their food problems, the priorities remain regulation of the
commodities market, an increase in aid and the need for short-term provisions and
mechanisms for immediate intervention.5
The speech of the Tanzanian President Julius Nyerere at the Arusha conference
touched a point midway between the utopian vision and the impassioned requiem.
He compared the grouping of the developing countries to “a trade union of the
poor” that must remain united, for otherwise no one would give them anything
other than alms. The hero of Tanzanian independence painted the portrait of a
future in which the South would construct their own multinational corporations,
joint shipping companies, and autonomous insurance firms that would cease to
serve the interests of Western banks. First and foremost, Nyerere remarked—in his
schoolteacher’s tone that did not always produce the desired effects—it was neces-
sary to reflect on the multiplicity of interests held by the peoples of the South:
I want to reiterate that it was our nationalism that brought us together, because we
must first understand ourselves in order to pursue progress. The Group of 77 does not
have an ideology in common. Some of us are for a socialism that claims to be “scien-
tific,” others simply socialists, others capitalists, others theocracies, and still others
fascists! And we are not necessarily all friendly with one another: Several countries are
today at war with each other. Our per capita income varies from $100 to $2,000 dol-
lars per year. Some of us have minerals, others do not; some of us have no access to the
sea, while others are surrounded by enormous oceans.
The immediate interests and negotiating priorities of the G77 countries are thus
quite different. There is OPEC, the poorest countries, the Least Developed, the Newly
Industrialized, the landlocked, and so on; some of these classifications are our own

4
CHAN, 5AG3, HJB 3, Mission Permanente, “Réflexions sur la Vème CNUCED,” June 18,
1979. The French representative to the United Nations noted that in 1979 the South was divided into:
1. “Genevans” and “New Yorkers”; 2. oil producers and non-producers; 3. Asians, Latin Americans,
and Africans; 4. rich and poor (the efforts on behalf of the less advanced of the LDCs were beginning
to concern those that were relatively better off); 5. pro-Soviets and the rest; and 6. Arabs and the
rest.
5
L. Magrini, “La V Unctad e le prospettive del dialogo Nord–Sud,” in (1979) Politica internazion-
ale (August–September).
244 After Empires
doing, others have been created by others for their own purposes. This type of subdivi-
sion of the G77 can be useful . . . But it is also very dangerous.6
There had always been a significant diversity of interests and diplomatic positions
among the various regions of the developing world, of course, since the beginning.
The tensions lurking within the developing world—not merely those of an eco-
nomic nature, but also the increasingly brutal military conflicts for regional dom-
ination—exploded violently at the end of the 1970s. With the end of the era of
epic wars of decolonization or crusades for economic independence, the passing of
the heroic liberation generation forced the nations of the Third World to confront
the fact that a common struggle was difficult to sustain in a period of economic
contraction. Without social, cultural, and political structures capable of fostering
cooperation and mutual understanding—without the creation of robust regional
or international institutions and agreements—they found it impossible to over-
come the logic of military might and economic competition.
It was in the Arab world, and in the oil-producing nations—that is, among
those that with greater cohesion could have done so much more to fulfill plans for
a new international economic order—that some of the decisive events occurred.
Already by 1977 oil policy had begun to produce significant divergences of opin-
ion among the oil-producing nations, as the unequivocal comments of the Iraqi
President to the Venezuelan ambassador, referring to the Saudi oil strategy of
reducing prices and increasing production, amply demonstrated: “They are not
rational people. So what are they? They are uncultured, illiterate, erratic bedouins,
a product of one of the most backwards regions in the world that apart from oil has
nothing but sand.”7 At its 55th meeting in 1979, OPEC managed to ratify a
US$2.4 billion increase in its Special Fund to fuel cooperation with developing
countries, and agreed to convene the Second Summit of OPEC Sovereigns and
Heads of State in Baghdad in 1980 to celebrate the twentieth anniversary of the
creation of OPEC. But the Baghdad Summit never took place, as the oil producers
erupted into internal conflict, thus undermining the possibility of further collabo-
ration with the other developing countries.
By this time the 1978 Camp David Accords between Egypt and Israel, signed
thanks to the mediation of President Jimmy Carter, had provoked the revolt of the
Arab League against the leadership of Sadat, who was accused of having betrayed
Palestine in exchange for the return of parts of the Sinai Peninsula.8 Egypt, one of
the founding nations of the Non-Aligned Movement, was thus forcibly isolated
and treated as an untrustworthy ally of Washington. Then in 1979, the Islamic
revolution in Iran that forced the Shah into exile also plunged into crisis Iran’s
already troubled relations with Saudi Arabia, as well as those with Iraq, another

6
G. Mwakikagile, Nyerere and Africa: The End of an Era (Atlanta, GA: Protea Publishing, 2002).
7
AMPPRE, Interior, Visita oficial del Señor Presidente de la Republica Carlos Andrés Pérez a:
Kuwait—Arabia Saudita—Irán—Irak y Qatar, 1977, Memo, “Análisis y recomendaciones en relación
al Proyecto de Comunicado Conjunto aralia-venezolano, presentado por la Embajada de Irak en
Caracas.”
8
Shlaim, The Iron Wall.
 Managing Globalization 245

regime with regional hegemonic ambitions.9 The Shi’ism of Ayatollah Khomeini,

the spiritual leader of the revolution, with its emphasis placed on religious identity,
necessarily accented the dividing lines in the Middle East between Arabs of differ-
ent beliefs—and especially the Sunni faith.10 In Iraq that same year, Saddam Hus-
sein expelled from the ruling Ba’ath Party those elements with socialist or
pan-Arabist tendencies, who were thus amenable to unification with Syria, in order
to install a nationalist regime centered ever more tightly around his cult of person-
ality. Saddam assumed the presidency in 1980, soon entering a Pyrrhic war of
attrition against Iran (aiming at, among other things, annexation of the Shatt al-
Arab), which he believed had fallen prey to revolutionary chaos and would be
incapable of mustering sufficient resistance.11 In this heated climate, the death of a
leader from the glorious period of Arab independence, who had been one of the
voices of Arab solidarity and of the nationalization drive, assumed great symbolic
importance. Indeed, the death in 1979 of the Algerian president Houari Boume-
dienne, who more than any other regional leader had represented the effort to
modernize the Arab world through rapid industrialization, and linked this effort to
broader change in the rules of the international economy to favor the Third World
as a whole, provoked a spontaneous and unexpected outburst of collective mourn-
ing among the Algerian people.12
At the Havana summit mentioned above, the non-aligned states not only closed
the cycle of Nehru, Tito, and Boumedienne, but also accentuated the divisions and
conflicts between the nations of the socialist bloc: The hostility between the two
communist countries of Vietnam and Cambodia in particular created a sensa-
tion.13 When the first soldiers of the Red Army later crossed into Afghanistan on
Christmas Day 1979, to provide military support to a faction of the local com-
munist party tied to Moscow, condemnation of the invasion was unanimous in the
United Nations, including even the Indian government, historically one of Mos-
cow’s strongest allies in the region. Moscow, whose star (to most international
observers, especially in Africa and Latin America) had seemed to be in the ascend-
ant for most of the 1970s, suddenly lost whatever credibility it had left as a sup-
porter of the cause of the peoples of the Third World. The suicidal gamble of the
military mission in Afghanistan had been foreseen by the Soviet Foreign Minister
Gromyko in March 1979:
All that we have done in recent years with such effort in terms of détente of international
relations, arms reductions, and much more—all that would be overthrown. China, of
course, will receive a nice gift. All the nonaligned countries will be against us.14

9
E. Abrahamian, A History of Modern Iran. Cambridge: Cambridge University Press, 2008,
pp. 155–62.
10
F. Sabahi, Storia dell’Iran (Milan: Bruno Mondadori, 2006), p. 165.
11
C. Tripp, A History of Iraq (Cambridge: Cambridge University Press, 2002).
12
G. Corm, Il Libano contemporaneo. Storia e società (Milan: Jaca Book, 2006), pp. 166–7.
13
C. Liauzu, L’enjeu tiermondiste (Paris: L’Harmattan, 1987).
14
V. Zubok, A Failed Empire: The Soviet Union in the Cold War from Stalin to Gorbachev (Chapel
Hill: University of North Carolina Press, 2007), p. 260.
246 After Empires

This alteration of the international political picture would have been sufficient by
itself to explain the rupture of Third World solidarity at the end of the 1970s.
Reinforcing this process, however, were two additional radical changes to the glo-
bal economic outlook.15
The first of these changes was the second oil crisis of 1979. Beginning in April of
that year, and for twelve consecutive months, the price of crude kept rising until it
reached US$42 per barrel, its highest level until 2006. Unlike its predecessor in 1973,
this rise in oil prices was facilitated not just by deliberate decisions of the oil-producing
states, but mainly by the reduction in Iranian oil production following the revolution
and the later Iraqi invasion, and by the panic sown by these two events on the emerg-
ing “spot” market for oil. The overtures of OPEC solidarity with the non-producing
developing countries, again unlike what occurred in 1973, went nowhere after the
Iran–Iraq war and there was to be no successful offensive to exploit their temporary
position of strength to force changes to the rules of the international economy. The
second oil crisis simply created a tremendous aggravation of the trade imbalances of
the importing countries, and at the same time produced a terrible oil glut when Saudi
Arabia and other OPEC countries massively increased production at the same time as
new non-OPEC oil was coming “on stream” (mainly from North Sea and Mexico).16
If that were not enough, precisely at the same time in 1979 the US Federal Reserve,
then guided by Paul Volcker, began its epic battle to stabilize the value of the dollar
after the devaluations of the 1970s and thus defeat inflation once and for all. Federal
interest rates reached 20 percent through 1982—‘the highest rates since the birth of
Jesus Christ” as described by Chancellor Schmidt—plunging the American economy
into deep crisis and recession, though at the same time funneling capital from the rest
of the world toward Wall Street and into government bonds. This shift in American
monetary policy represented a dramatic about-face both within the Western world,
where growth and employment suffered hits, and for the countries of the Third
World, which found themselves forced to pay exorbitant rates on their debt held in
dollars.17 In total, by the middle of the 1980s Third World debt amounted to the
astronomical sum of US$900 billion. The possibility of remedying debt multiplica-
tion with an increase in exports was further limited by the economic stagnation of
the industrialized world. According to Bernard Nossiter, the “Volcker shock” and the
deflationary policy of the most important Western nations “cost third world nations…
more than $140 billion in goods and services: $41 billion in extra interest, $79 bil-
lion in lower commodity prices and $21 billion in reduced export volume.”18
The second oil crisis and the strategic decision to pursue deflation in Western
monetary policy not only exacerbated the crisis of the poorest nations and in the
emerging countries, but also snapped the bonds of their solidarity by widening the
gap in their respective abilities to compete in a globalized economy. Beginning at
the end of the 1970s, inequality between the richest and poorest nations began to
15
Prashad, The Darker Nations, pp. 349–71.
16
On the effects of the 1979–80 “oil shock” on the international oil market see L. Maugeri, The
Age of Oil: the Mythology, History, and Future of the World’s Most Controversial Resource (Westport:
Praeger, 2006), pp. 121–33.
17
Parboni, Il conflitto economico mondiale, pp. 293–300.
18
Nossiter, The Global Struggle for More, p. 16.
 Managing Globalization 247

grow ever-more obvious: The income disparity between the fifth of the world liv-
ing in the wealthiest countries and the fifth living in the poorest countries of the
South grew from 30:1 in 1960, to 60:1 in 1990, before reaching 74:1 in 1997.19 A
similar growth in inequality was manifest within the developing world itself.
According to Manuel Castells, while between 1950 and 1973 incomes in twenty-
two of the thirty-four developing countries he examined drew closer to those of the
United States, from 1973 to 1992 only twelve developing countries continued to
converge on the American benchmark.20 The economic upheaval of the late 1970s
created winners and losers, and certainly signaled the end of the united efforts of
what to that time had been considered the Third World. At the same time such
upheavals encouraged several of these countries, China foremost among them, to
concentrate their efforts on international trade, to undertake modernizing reforms
that would nourish their domestic markets, and finally in 1980 to join economic
organizations like the International Monetary Fund and World Bank, which they
had long violently opposed.21
The IMF historian Margaret de Vries aptly summarized the evolution of the
international economy through the end of the 1970s: “Whereas the quarter cen-
tury from 1945 to 1970 had been ‘The Age of Growth,’ the next quarter century
at least as of 1979 seemed to be evolving as ‘The Age of Equality.’”22 The second oil
crisis of 1979 and the emergence of changes in Western political and economic
thought, symbolized by the election of British Prime Minister Margaret Thatcher
in 1979 and of the Republican Ronald Reagan as President of the United States,
opened a new era the consequences of which would last well into the twenty-first
century. This era could well be named “The Age of Competition” or, as argued by
Mark Mazower, the Real New International Economic Order based on a relaunch
of the Bretton Woods institutions, the general elimination of trade and financial
barriers, and the demise of the basically UN-centered economic order imagined by
the Third World.23 In the West, the evolution of the international economic system
began to be described by the phrase “globalization,” a term that carried the impli-
cation that the capitalist industrialized countries could no longer resist technologi-
cal and financial developments that were now outside the control of any single
government. The communist world, instead, continued to employ the concept of
“internationalism,” which allowed greater room to justify intervention in far-flung
locations and the assumption of responsibility for the Third World—a burden that
the Soviets were no longer capable of shouldering without aggravating the already
tremendous sacrifices imposed upon the citizens of communist eastern Europe.24

19
D. Harvey, A Brief History of Neoliberalism (Oxford: Oxford University Press, 2005), p. 19.
20
Jha, The Twilight of the Nation-State, p. 149.
21
M.C. Bergère, Storia della Cina dal 1949 ai giorni nostri (Bologna: Il Mulino, 2003), p. 351.
22
M.G. de Vries, The IMF in a Changing World 1945–85 (Washington, DC: International Mone-
tary Fund, 1986), p. 156.
23
On the differences between the shocks of 1973 and 1979, see J.-P. Fitoussi, Il dibattito proibito.
Moneta, Europea, Povertà (Bologna: Il Mulino, 1997), pp. 15–17. M. Mazower, Governing the World.
The Rise and Fall of an Idea, 1815 to Present. New York: Penguin, 2012.
24
R. Vinen, A History in Fragments: Europe in the Twentieth Century (London: Abacus, 2000),
pp. 469–70.
248 After Empires

The renewed tensions of the Cold War, the sense that the world was starting to
obey the laws of Shakespeare rather than those of Talleyrand—that is, responding
to the staged drama of face-to-face confrontation rather than patient, back-chan-
nels, diplomatic dialogue—suggested to Robert McNamara that the World Bank,
too, should take a more resolute stance. Until the end of the 1970s, the Bank’s
high-ranking officials had been heavily interrogated on several widespread criti-
cisms of the way in which it distributed aid, the illiberal regimes that it sustained,
the way to target investment on basic needs, and its collaboration with the Brandt
Commission, which could restore needed legitimacy to the Washington institu-
tion. In the midst of the second oil crisis, McNamara, who in 1981 would bring
his mandate to a close, immediately intuited the potential economic consequences
of the new situation and the revolution in store for the coming decade. He under-
stood, before the new Republican administration in the USA or the leaders of
western Europe themselves, the leadership role that international economic insti-
tutions could play once the criticisms of public opinion had been set aside and the
pressures placed on the Bretton Woods institutions by the G77 nations had
relented. The discussion that took place in the President’s Council at the World
Bank on February 11, 1980 is instructive, for it reveals—without any unnecessary
diplomatic prudence—the reasons behind the new subaltern status of the develop-
ing world.25 McNamara opened the meeting with the affirmation that the primary
problem after the oil crisis was that deficits had not been financed, which had led
to smaller investments, and thus fewer imports and smaller growth for the devel-
oping countries. The President stated that, after weeks of thought, he had come to
the conclusion that what was needed was “structural adjustment” loans—that is,
loans not for single projects, but to induce macroeconomic changes such as a
reduction in spending or a rise in interest rates—in order to intervene rapidly in
those developing countries that presented significant balance of payments defi-
cits.26 This was an innovation pregnant with future possibilities, that would defi-
nitely set aside the issues of basic human needs and agreements on commodities.
This policy would permit close collaboration with the IMF, built primarily on the
imposition of economic choices in line with the interests of the West’s largest pri-
vate creditors. Regarding the future role of the Bank in the 1980s, McNamara
observed that all the discussions he had helped stimulate on the new economic
order were now “last year’s fashion.” In light of more recent developments, the
Bank would have to occupy itself only with financing the largest balance of pay-
ments deficits: “We will find ourselves faced with a new world.” And it was no
longer necessary to worry about the possible opposition of the developing coun-
tries because, to take the example of the Turkish government that, for all its
shouting, was “flat on its back,” and like the others was well aware of the una-
voidable logic that would confront all those reluctant to follow Washington’s

25
WBGA, Office of the President, Records of Robert S. McNamara, Minutes 1976–1981, Box 2,
“President’s Council Meeting,” February 11, 1980.
26
On the way in which structural adjustments became the core business of the World Bank, see
N. Woods, The Globalizers: The IMF, the World Bank, and Their Borrowers (Ithaca, NY: Cornell Uni-
versity Press, 2006).
 Managing Globalization 249

prescriptions: “No letter [of intent] → no loan → no democracy → no economy.”

Even the Financial Times’s expert was surprised by the new spirit expressed by the
World Bank in its 1981 report:
Professional cynics might suspect that, in producing a Report which is so much more
conservative in approach than some of its predecessors, and with so much emphasis
on the need for developing countries to help themselves, the Bank is trimming its sails
to the political wind in Washington, and is trying to persuade the Reagan team that
1818 H Street in Washington is not exclusively staffed by communists.27
And yet, if this revolution that occurred between 1979 and 1981 is quite evident
with hindsight, it is equally clear that not all informed observers or even policymak-
ers immediately understood its relevance.28 Margaret Thatcher notes in her memoirs:
“We were not to know it at the time, but 1981 was the last year of the West’s retreat
before the axis of convenience between the Soviet Union and the Third World.”

T H E E U RO P E A N S I N G L E M A R K E T P RO J E C T

Parallel with the disintegration of the united Southern front, a new current of
thought was emerging in the United States that would soon reveal itself to be the
most significant challenge to the socioeconomic structures developed by the indus-
trialized countries since the Second World War.29 “Neoconservatism,” and the
“neoliberalism” which informed its economic thinking, was born as a reaction
against the sense of political degeneration and moral relativism that seemed perva-
sive in American society during the Nixon and Carter years. The new international
economic order itself had contributed, according to neoconservatives, to a weaken-
ing of America’s international prestige and economic strength. Moynihan noted
how after the UN Special Session in 1974, “the United States was seen to be reeling
back in compounded defeat, incapable of retaliation, unwilling even to contem-
plate retaliation.”30 In a few short years, this school of political thought would
move from the margins to the center of the political stage, arguing against the role
of the state, against international cooperation, against the multilateral and transat-
lantic lobbies represented by the Trilateral Commission and the Bilderberg Group,
and proclaiming a “new beginning” in United States history.31 The Heritage Foun-
dation—a sort of Ford Foundation of the neoconservative movement—was estab-
lished in 1973, and by 1985 had a staff of 105 and a US$11 million budget, and

27
I. Davidson, Financial Times, July 20, 1981. Davidson also highlights a passage from the Report
dedicated to industrial policy in western Europe: “For every $20,000-a-year job saved in Swedish
shipyards, Swedish taxpayers pay an estimated $60,000 annual subsidy.”
28
One important book that shows the widespread belief, even among the finest anlysists of inter-
national relations, in the future of Third World as an increasingly powerful actor of international
cooperation at the beginning of the 1980s is H. Bull and A. Watson (eds), The Expansion of Interna-
tional Society (Oxford: Clarendon Press, 1984).
29
M. Del Pero, The Eccentric Realist. Henry Kissinger and the Shaping of American Foreign Policy
(Ithaca, NY: Cornell University Press, 2009).
30
Moynihan, A Dangerous Place, p. 53.
31
P. Gerbet, Le rêve d’un ordre mondial: De la SDN à l’ONU (Paris: Imprimerie Nationale, 1996), p. 326.
250 After Empires

counted some 36 members in government positions.32 Similarly, in Great Britain,

where Margaret Thatcher had been elected in 1979, the think tanks that had sup-
ported her candidacy emphasized the need to revive free enterprise and interna-
tional competition, instruments of liberation from the stranglehold of the unions,
and to drive the state out of business and services—while at the same time both
Reagan and Thatcher themselves actually increased budgets for security and
defense, and were cautious in their approach to welfare.33 In a speech to the Centre
for Policy Studies, the most important intellectual center for British neoliberalism,
Nigel Lawson—appointed Chancellor of the Exchequer in 1983—outlined how
their epic challenge was to liquidate, along with the postwar social democratic
compromise, the entire heritage of the Enlightenment: “The essential point is that
what we are witnessing is the reversion to an older tradition in the light of the
failure of what might be termed the new enlightenment.”34 Zeev Sternhell warns
against underestimating this “anti-enlightenment tradition” that, in essence, called
into question the very significance of the French Revolution:
First of all, there is the classical Burkean critique of utopianism, the defense of the
so-called Anglo-American tradition against the French tradition, the critique of egali-
tarianism, and an assertion of the importance of religion in the life of society and of
the centrality of traditional moral values. And together with all this, there is a rejection
of what is called the liberal “counterculture,” which is held to be opposed to tradi-
tional “American values.” Nationalism, which admires American power, also takes the
form of an out-and-out war against international organizations (especially the United
Nations, which endangers national sovereignty), against the dismantling of the nation-
state within the framework of the European Union, and against the progressive disap-
pearance of national characteristics. Here one can easily recognize practically all the
major themes of Anti-Enlightenment thought from Burke to the mid-twentieth
century.35
With the victory of Ronald Reagan in the presidential election, and especially after
his inauguration in 1981, the United States moved swiftly to adopt a muscular and
media-friendly foreign policy, taking a stance of open conflict with the Third
World and the “Evil Empire” of international communism. In 1982 Washington
finally rejected the UN Convention on the Law of the Sea, of extremely limited
utility without American ratification.36 In January 1985 the United States would
formally withdraw from UNESCO, after previously having left and returned to
the ILO. The Republican administration seemed initially to harbor the same lack
of faith in international economic organizations such as the World Bank, accused

32
S. Blumenthal, The Rise of the Counter-Establishment: The Conservative Ascent to Political Power
(New York: Union Square Press, 1986), p. 33.
33
D. Basosi, “The European Community and International Reaganomics, 1981–85”, in K. Patel
and K. Weisbrode (eds), European Integration and the Atlantic Community in the 1980s (Cambridge:
Cambridge University Press, forthcoming 2013).
34
R. Cockett, Thinking the Unthinkable: Think-Tanks and the Economic Counter-Revolution, 1931–
1983 (London: HarperCollins, 1994), p. 215.
35
Z. Sternhell, The Anti-Enlightenment Tradition (New Haven, CT: Yale University Press, 2009), p. 433.
36
Krasner, Structural Conflict, p. 11.
 Managing Globalization 251

of wasting American contributions on lavish salaries for stateless civil servants. But
the international economic institutions based in Washington would soon reveal
themselves to be rather useful at preparing the ground for the revival of freedom of
trade, investment, and capital movement.
With unstoppable force the political and economic climate rapidly shifted after
1980, and with it any opportunities for the structural modification of economic
relations in favor of the Third World. As the social and cultural tides generated by
the global 1968 slowly receded and transformed themselves into something new,
the very legitimacy of the rights claimed by the Third World began once more to
be called into question.37 While it is true that 1979 witnessed the publication of
Edward Said’s Orientalism, a groundbreaking classic that would inaugurate an
entirely new theoretical field studying Western cultural imperialism, it is equally
true that such analyses seemed to be confined to new university departments and
editorial houses focusing on “cultural studies” that seemed incapable of generating
effective political action. Meanwhile, the 1983 publication of the French writer
Pascal Bruckner’s The Tears of the White Man—which equated European compas-
sion with contempt, derided the notion of decolonization as the liberation of a
mythical form of new man, and denounced the unjust and antidemocratic regimes
of the Third World—enjoyed spectacular public success.38 The following year
marked the appearance of La Pensée ’68, which would become a best-selling French
diatribe against the “contemporary antihumanism” unleashed by 1968.39 Such
books called into question both Marxism and its philosophy of history, or more
broadly any ideology that claimed the mantle of progress by virtue of immutable
laws—from communism to socialism—in the name of a focus on the language of
individual rights and freedoms.40 This new language was less respectful of blocs,
either that of the Soviets or that of the Third World, and the leadership it referred
to no longer considered these blocs as immune from criticism or attack. The Hel-
sinki process itself was by now seen in West Germany not as a guarantee of security
or economic cooperation intended to slowly bring about the democratization of
communist Europe,41 but as an offensive weapon to bolster the room for maneuver
of dissidents in the Soviet Union.
In 1980, an Italian entrepreneur careful to detect which way the political
winds were blowing could allow himself to boast a little about the revival of the
West and the need to overcome an otherwise useless sense of guilt at the fate of
the poor nations of the world. Development, after all, was only achievable
through integration into the capitalist system, with an acceptance of the rules
and the political systems of the capitalist countries. Gianni Agnelli, the same

37
K. Ross, May ’68 and Its Afterlives (Chicago: University of Chicago Press, 2002), pp. 158–69.
38
P. Bruckner, The Tears of the White Man: Compassion as Contempt (New York: Free Press, 1986).
39
L. Ferry and A. Renaut, La Pensée ’68: Essai sur l’antihumanisme contemporain (Paris: Gallimard,
1985).
40
Judt, Postwar, pp. 559–66.
41
T. Garton Ash, In Europe’s Name: Germany and the Divided Continent (London: Jonathan Cape,
1993), pp. 258–79.
252 After Empires

man who five years earlier had been forced to sign the humiliating agreement
installing Italy’s scala mobile (a system of wage and price indexing), declared with
renewed faith that:
[o]ur strongest weapon of attack is economic. But not the weapon of unconditional
aid, which has only contributed to the weakness of our currencies, to the clouding of
our vision, to the perpetuation of regimes contrary to our principles, to magnify the
lack of self-confidence in many of us. Our weapon is the ability to include the South
in our way of life . . .
The foreign and military policy of the West and its industrial policy must be ever-
more intertwined.42
This new and less conciliatory cultural awareness in the industrialized world did
not mean, however, that Europe immediately renounced its intentions to play a
role as the fulcrum of the global negotiations with the developing countries. Nor
did this mean that western European governments, under strong pressure from
internal pacifist movements, did not try to avoid the strong US stance against the
Soviet “Empire of Evil” in favor of an approach based on the “interdependence”
between capitalist and communist Europe.43 And it is also true that, while political
leaders were becoming ever more disinterested in the potential development of
state-led mechanisms of international cooperation in favor of the poorest coun-
tries, within civil society an increasing number of citizens were getting involved in
nongovernmental organizations (NGOs), hoping to engage in direct cooperation
with the developing countries. In the words of the Italian historian Angelo Del
Boca, whose many contributions to scholarship have aimed to demolish the myth
of Italian colonialism and foreign policy in general as the benign work of “good
people,” this part of civil society:
is an army of four million volunteers, who every day, in silence, almost in secret, walk
the streets of Italy and the world to combat against suffering in all its guises. It is an
army composed of 38,000 organizations . . . If there are Italians who merit the defini-
tion of “good people”, in its authentic, non-self-exculpatory, non-mythologizing
meaning, then it is these wonderful and humble volunteer workers.44
In the South itself, the European Community continued at the beginning of the
1980s to be identified as a privileged partner. In a conference at the Jawaharlal
Nehru University in New Delhi organized by circles with ties to the Indian govern-
ment, the keynote speaker K.B. Lall, former Secretary of Defense and Indian
Ambassador to the European Community, reiterated:
No other entity in the First World is as favourably situated to appreciate the impact of
economics on politics or appraise the trade-offs between security and welfare. For this
reason, it is the EEC’s obligation to sharpen its perceptions, to share them with other
industrial nations, and to use the leverage enjoyed by its member states to develop a

42
G. Agnelli, Una certa idea dell’Europa e dell’America (Turin: Einaudi, 2005), pp. 171–2.
43
Nolan, The Transatlantic Century, pp. 308–9.
44
A. Del Boca, Italiani, brava gente? (Vicenza: Neri Pozza, 2005), pp. 303–4.
 Managing Globalization 253
consensus within the Organization for Cooperation and Development (OECD) in
favour of initiatives to spur the global negotiations to successful conclusion.45
Even Helmut Schmidt seemed to have understood the need for greater concessions
to the Third World in order to resolve the economic emergency and head off a
potential global recession created by the second oil crisis. Shortly before UNCTAD
V in Havana, over the objections of the liberals in its coalition governing the Fed-
eral Republic of Germany, Schmidt presented a global plan for the stabilization of
incomes from commodities to the World Bank Development Committee and the
IMF: An international system similar to that already operating within Germany’s
borders, which guaranteed subsidies for unemployment during lean periods.46
The conciliatory attitude of European trade unions toward the Community’s
cooperation and development policy remained intact even in the immediate after-
math of the second oil shock. In a memorandum presented to the European Com-
mission, one expert made note of the peculiarity of the unions’ position with
respect to development issues.47 According to this analysis the unions defined
development not only as a growth in productivity, but also as “an improvement of
the material, moral and cultural resources of men and peoples, with the objective
of their complete development as persons.” The unions hoped to spare the margin-
alized classes of the developing countries from the inhumane exploitation suffered
by the workers of Europe in the course of the nineteenth century. It was thus nec-
essary to stimulate the workers of the South to build their own organizations and
protective safeguards, combat military dictatorships, and push for greater attention
to human rights in trade negotiations. Even more importantly, investments in the
developing countries would have to be planned in such a way as to be structurally
linked to the restructuring of industries in the Western world. With these recom-
mendations in mind, it is not difficult to comprehend the rapid disillusionment
with the “renegotiation” of the Lomé Convention. In 1980, after the signing of
Lomé II, the ETUC decried the absence of a workers’ rights clause in the new
agreement, and argued that the goal of guaranteeing income from imports should
be widened to include all the developing countries, without being limited to the
former colonial nations.48 The French communist union went much further in its
criticism, arguing that the proceeds from stabilization programs had practically all
returned to Europe, and that Lomé had finally revealed itself for what it was:
A neocolonial scam.49 The reality was that, even though the question had raised

45
K. Lall, “The EEC, the Third World, and the New International Economic Order,” in K. Lall
and H. Chopra (eds), The EEC and the Third World (Atlantic Highlands, NJ: Humanities Press, 1981),
p. xvii.
46
L.L. Ortmayer, “West Germany and the Third World: Virtues of the Market or New Political
Role?,” in P. Taylor and G.A. Raymond (eds), Third World Policies of Industrialized Nations (Westport,
CT: Greenwood Press, 1982), pp. 67–97.
47
IISH, ETUC, Box 2934, J. Brück, Conseiller de la Dg VIII, “Les orientations fondamentales du
mouvement sindacale,” June 14, 1977.
48
IISH, ETUC, Box 2934, “Trade Union Statement on the Lomé II Convention, Geneva,” May
30, 1980.
49
IISH, ETUC, Box 2983, “CGT Déclaration a l’occasion de la reunion du Comité Paritaire a
Bordeaux,” February 14, 1980.
254 After Empires

debates in the European Parliament, Lomé II had confirmed the absence of politi-
cal conditionality and of human rights clauses in the EC aid scheme.
European labor organizations wanted to influence the Community’s policy
toward the South, but above all they hoped to have a preponderant voice in the
restructuring of European industry. While it was true, as the European Commis-
sion led by Roy Jenkins had predicted, that the emerging countries of the South
would represent a crucial market for European exports, and would thus contribute
to jump-starting growth on the continent, it was equally true that these countries
would grab an important share of European manufacturing. There is plenty of
evidence to suggest that within the Commission there were those who argued for
closer collaboration with the unions in this regard.50 But European governments
never succeeded in putting into practice a common industrial policy. Such efforts
went up in smoke at the end of the 1970s, along with the Vredeling directive on
workers’ participation and information in large-scale industry.51 Workers employed
in manufacturing industries that competed with the South were essentially left to
the mercies of international competition.
In June 1980, at the European summit in Venice, the Ten—Greece would offi-
cially join in 1981—took a surprisingly innovative position on both recognition of
the rights of the Palestinian peoples and the need to revive the North–South dia-
logue, dormant after the conclusion of the CIEC. They requested an analysis of the
conclusions of the Brandt Commission. On the eve of the Tenth Special Session of
the UN General Assembly in December 1980, which was set to reopen the as-yet
unproductive discussions on the Common Fund for Commodities, the Commu-
nity was still divided on which strategy to take:
The fierce insistence with which certain delegations that have not accepted the “con-
sensus” have defended the Bretton Woods institutions from having their autonomy
called into question, is not only revealing of the weight of the finance ministers in the
governments of the nations in question, but also of the fact that these countries do not
accept the idea of the “globality” of negotiations, and that the new North–South dia-
logue is understood rather as a way to achieve certain very specific adjustments.52
The Socialist International, for its part, pursued direct connections with the coun-
tries of the Non-Aligned Movement, raising more than a few concerns in Moscow
regarding the potential attractive power of a personality like that of Brandt in Latin
America.53 At the conference of socialist party leaders in May 1981, however, the
atmosphere was rather tense. The Reagan administration and its new policy of
“counterinsurgency” was pushing the world toward a new Cold War. Events in
Afghanistan and El Salvador, combined with the Euromissiles crisis, were margin-

50
IISU, ETUC, Box 3009, EC Commission, “Reciprocal implications of the Community’s devel-
opment cooperation policy and its other policies,” June 14, 1977.
51
Francesco Petrini, “Demanding Democracy in the Workplace: The Trade Union Confederation
and the Struggle to Regulate Multinationals,” in W. Kaiser and J.H. Meyer (eds), Societal Actors in
European Integration 1958–92: From Polity Building to Policy Making, Basingstoke, Palgrave, 2012.
52
IISH, ETUC, Box 3011, Commission, DG1, “Onzième session extraordinaire de l’Assemblée
générale, New York, 25 Aout–15 Septembre, 1980.”
53
R. Allison, The Soviet Union and the Strategy of Non-Alignment in the Third World (Cambridge:
Cambridge University Press, 1988), p. 57.
 Managing Globalization 255

alizing the Socialist International and making its politics of détente seem ever more
hollow. The Belgian Karel van Miert underlined how conservative politicians were
now comparing détente to the disastrous policy of appeasement at Munich that
had failed to halt the spread of Nazism. The conference minutes carefully danced
around the issue: “Under the current circumstances it would be imprudent to
accentuate any antagonism toward the United States.”54
The failure of European socialism’s internationalist strategy was evident at Can-
cun, in the meeting held there at the end of 1981. The summit had been organized
by the Mexican President Lòpez Portillo, the Canadian Prime Minister Pierre Tru-
deau, and the Austrian President Bruno Kreisky with the firm intention of reviving
the North–South dialogue at the highest levels and of discussing the future concrete
reforms inspired by the Brandt Commission. All of the world’s most powerful leaders
were present at the seaside resort meeting, twenty-two heads of state or government
in total, including Reagan and Thatcher. Mitterrand with his cries against “interna-
tional economic Darwinism” and his call for expansion in international aid and com-
modity agreements was, with Trudeau, the only hope for the success of global
negotiations.55 But France’s position was not a majority one among industrialized
countries, many of which by then shared the World Bank’s new position that devel-
oping countries should open up and help themselves and that decreasing trade bar-
riers and open capital markets would be the best means to favor global growth. In
fact, the Cancun summit marked the end of debate on a new international economic
order. The primary roadblock was Reagan, not only for his personal ideological aver-
sion to the United Nations, but because solutions on commodities or questions of
international debt would be expensive for, and call into question the centrality of, the
international economic institutions based in Washington, in which the United States
had a much stronger position than in other international forums.56
In 1981, the Commission’s delegation to Washington reported that the Ameri-
can strategy in the North–South dialogue had changed, from “talking them to
death” to “making a stand.”57 For their part the Community nations, after having
promoted the Lomé Convention in 1975 and the Paris conference until 1977,
appeared in the following years to have lost the ability and the desire to act under
the auspices of the UN, concentrating primarily instead on the protection of West-
ern economic institutions. The 1981 report clarified the new European strategy,
which was fixed on the more modest goal of influencing the American position:
“We must maintain pressure on the Americans to favor cautious progress on
North–South affairs, strong international economic institutions, and real multilat-
eral assistance.”

54
IISH, SI 976, Ger Verhoeve, “Report on Party Leaders’ Conference in Amsterdam,” May 26,
1981.
55
5 AG 4, 4273, Note, “Préparation du sommet de Cancun; aspects commerciaux,” September 28,
1981.
56
Interview with Henri Nau (Senior Staff Member of the NSC in the White House responsible for
Economic Affairs from 1981–3). Available online at <www.g7.utoronto.ca/oralhistory/nau040507.
html>.
57
IISH, ETUC, Box 2934, Washington Delegation, “North–South Policy: A Source of EC–US
Friction,” May 1, 1981.
256 After Empires

In a 1982 meeting of the Presidium of the Socialist International, Brandt spoke

explicitly of an impasse on three fronts in the elaboration of the socialists’ strategy.58
First, there was no agreement on how to behave toward the emergent anticom-
munist Solidarnosc (Solidarity) movement in Poland; pressures were strong to
adopt a pro-Western stance. In Latin America, many were asking themselves how
credible the International could be in its efforts to overcome its predominantly
Eurocentric stance. And finally, on the North–South dialogue:
The fundamental message of my Report, which was published two years ago now, and
led to the Cancun meeting last October, has not yet led to any concrete action. The
global negotiations in the United Nations have not yet begun. In the meantime, the
situation of many citizens in many countries has become almost hopeless.
The memorandum presented in 1982 by the Development Commissioner Edgar
Pisani can thus be considered a kind of eulogy for the EC’s global cooperation
policy. Pisani argued that global North–South negotiations were being blocked by
renewed interest in the Cold War, and that a new, regional, political dialogue
should have been set up between the EC and the ACP countries participating in
Lomé. The debates over the memorandum proved that while there was no agree-
ment on which path to take—and that British opposition to any role for the EC in
political negotiations with the Global South (which could lead to impossible finan-
cial commitments) would be outspoken—the only idea that could receive approval
was that of rendering aid to Lomé countries conditional upon some form of politi-
cal cooperation. This signaled a definitive break with the position the EC had held
since the 1970s of the unconditionalility of European aid, and the opening of an
entirely different era in development and cooperation politics.59
By the middle of the 1980s, Europeans had to face several fresh challenges from
a new kind of modernity:
Immigration began to outpace emigration. Secularization jumped forward. Women
turned from the married kitchen to the labor market and to individual emancipation.
Labour demands expanded and contracted. Industrial employment peaked and
descended. The working class reached its strongest position ever, and soon lost it. The
boom culminated and went into its first crises. Socialist radicalism exploded and
imploded. Post-war right-wing liberalism and moderate conservatism were discredited
by the left, and re-emerged, invigorated, in a much more militant form.60

58
IISH, SI 977, Willy Brandt, “Introductory Remarks at the Presidium Meeting of the Socialist
International in Bonn on April 1, 1982,” April 2, 1982.
59
For the debates on the Pisani memorandum, see G. Migani, “Les Accords de Lomé et les rela-
tions eurafricaines: Du dialogue Nord–Sud aux droits de l’homme,” in G.H. Soutou and E. Robin-
Hivert (eds), L’Afrique indépendante dans le système international (Paris: PUPS, 2011). The increasing
role of multilateral aid as a proportion of total western European aid halted at the beginning of the
1980s (quando si introducono le cluaole . . . ).
60
G. Therborn, European Modernity and Beyond: The Trajectory of European Societies, 1945–2000
(London: SAGE Publications, 1995), p. 351; cited in C. Crouch, Social Change in Western Europe
(Oxford: Oxford University Press, 1999), pp. 44–5. On the changes to European society from the
1970s to the 1980s see H. Kaelble, Sozialgeschichte Europas. 1945 bis zur Gegenwart (Munich: C.H.
Beck Verlag, 2007), pp. 414–15.
 Managing Globalization 257

European integration was going through one of its worst crisis: “Eurosclerosis” did
in fact set in from 1979 to 1984. In the preceding decade the Nine’s efforts to
reinforce a European identity and develop a new institutional model had been
continuous, and not without success. Conversely, in the early 1980s the countries
of western Europe, France above all, were beset by strong protectionist pressures,
such that they were willing to postpone indefinitely the entry of Spain and Portu-
gal into the Community. Schmidt considered the admission of Greece, the cradle
of Western democracy and civilization, so “important” that in a meeting with
Jenkins he voiced his wish to impede the free circulation of Greeks into other
Community nations: “there should never be full freedom of access… He did not
consider Germany to be a country of immigration.”61 Thatcher had very quickly
demonstrated the characteristics that made her the “Iron Lady.” At the first Euro-
pean Council in which she took part, she harangued her European colleagues for
four consecutive hours with demands and accusations, finally obtaining acknowl-
edgment that the question of Britain’s contribution to the Community budget
would be among the first to be resolved at the earliest possible opportunity.62
Thatcher had been prepared to block any Community decision until her demands
were satisfied. Mitterrand’s France seemed committed to advancing the progress of
a European social agenda, in parallel with its internal efforts at socialist planning
and strengthening of the public sector. This strategy went against the political cur-
rents then sweeping Europe, defying international monetary speculation and con-
trasting sharply with the reality of the shifting balance of power among social
forces, which saw workers’ organizations suffering dramatic defeats: In Italy, with
the breaking of the Fiat strike in 1980, in Britain in 1984, and Sweden, with the
failure of the Meidner plan in 1983. It was a period of intense conflict between two
different concepts of Europe, the British and the French, as evidenced by the Dutch
Prime Minister Ruud Lubbers’s recollection of the Copenhagen summit of 1982:
Right from the start of that meeting, there was this incredible tension between
Thatcher and Mitterrand. The crux of Mitterrand’s arguments was that investing in
Europe meant turning our back on America, discovering our own strengths, protect-
ing ourselves. After that, and on that basis, one could start initiating dialogues outside
Europe. His story, in short, was an anti-American one. Our own strengths first.
Thatcher said: “Rubbish. Rot. Open the doors. Free trade.”63
Once France—with its choice of monetary “discipline” in 1983, and consequent
renunciation of its plans to build “socialism in one country”—had taken a series of
steps to re-enter the European Monetary System, moving in the direction of tradi-
tional Europeanism and reviving its axis with Germany, all of Europe’s leaders

61
HAEU, EN 1148, Commission of the European Communities, Office of the President, Crispin
Tickell, “Call by the President of the European Commission on the Federal German Chancellor,
Chancellor’s Office,” Bonn, October 27, 1978.
62
Young, This Blessed Plot, pp. 306–74.
63
G. Mak, In Europe: Travels Through the Twentieth Century, trans. Sam Garrett (New York: Pan-
theon Books, 2007), pp. 727–8.
258 After Empires

committed themselves to finding a new project behind which to align the process
of European integration.64
The great idea behind which Europe’s leaders hitched the carriage of integration
was that of the Single Market. This new concept permitted them to align the ambi-
tions of those who hoped to strengthen the Brussels institutions to manage Euro-
pean economic stagnation and respond to the challenge of international economic
competition, with the more widely diffuse desires of those who pushed for a revival
of the “animal spirit” of freedom of enterprise and the market. The business world
was in fact applying intense pressure, especially those industries facing a stiff chal-
lenge from more technologically advanced competitors in Japan and the United
States.65 These forces pushed for a revival of the internal market, against that inert
mass of regulations that severely restricted the movement of capital and services,
and against the paralyzing presence of the public sector in the economy.66 It was in
1983 that seventeen businessmen, among them Visse Dekker of Philips and
Umberto Agnelli of Fiat, met in Volvo’s boardroom in Paris to create the European
Round Table (ERT) of industrialists. Their objective was to promote wider open-
ing of the market as well as increase investment in infrastructure and technology at
the European level. Their catchphrase was “modernization” to “break the stagna-
tion of the European economy.” It was not so much the creation of an exclusive
salon of high-level authorities from the business world that made the ERT innova-
tive; we have already noted the origins of the Bilderberg Group and the Trilateral
Commission. The novelty was that, in contrast to these transatlantic associations,
the ERT emphasized the coherence of producers’ and European business’s inter-
ests. Keith Middlemas has noted how Jean Monnet’s Action Committee was
refounded in 1979 to include for the first time a number of industrialists, and how
pressures from various industrial lobbies were central to the revival of European
integration in the mid-1980s.67 In support of such initiatives, in 1983 the Euro-
pean Parliament formed a working group that, with the name of the Kangaroo
Group, gave itself the specific goal of promoting the removal of trade barriers—
thus permitting goods to hop across Community borders more quickly. This
impulse toward freedom of commerce and of investment would eventually guaran-
tee that by the year 2000 the growth of exports would reach some 40 percent of
Germany’s GDP and 29 percent of that of France. Trade increases were accompa-
nied by a parallel rise in financial transactions to the point that, where they had
represented only 3 percent of global GDP in 1973, they reached a massive 149
percent only fifteen years later.68

64
G. Saunier, “The Place of Vocational Training in François Mitterrand’s Idea of a European Social
Space (1981–1984),” in (2004) 32 European Journal of Vocational Training (May–August), pp. 77–83.
65
K. Seitz, Die japanish-amerikanische Herausforerung: Deutschlands Hochtechnologieindustren kämpfen
ums Überleben (Stuttgart: Bonn Aktuell, 1990).
66
Many studies highlight how the Single Market agenda was headed principally by global private
enterprise. See J. Gillingham, European Integration, 1950–2003: Superstate or New Market Economy?
(Cambridge: Cambridge University Press, 2003), pp. 231–49; B. van Apeldoorn, Transnational Capi-
talism and the Struggle over European Integration (London: Routledge, 2002).
67
K. Middlemas, Orchestrating Europe: The Informal Politics of the European Union 1973–1995
(London: Fontana Press, 1995), p. 102.
68
Berend, Economic History of 20th Century Europe, pp. 290–1.
 Managing Globalization 259

The other important piece in this revival of European integration was the choice
of Jacques Delors as President of the Commission in 1985. An accomplished trade-
unionist and politician, he understood firsthand the internal dynamics of organ-
ized labor and the contradictions within the socialist archipelago. With the help of
the British Commissioner for the Internal Market, and in a college in which no
socialist held a high-profile post, he emphatically placed at the center of his agenda
the Single Market project, the enlargement to include Spain and Portugal, and the
increase of aid disbursements to the poorest regions within the European Com-
munity.69 In his memoirs, Delors explained his strategy thus:
The growth of markets and deregulation will happen with or without us. The wind
blowing in that direction is strong. It is a question of whether the pilot of the ship can
react to the wind and find a course that will be a good compromise between the evolu-
tion of the international environment and ideas, on the one hand, and the defense of
our interests and the European model, on the other.70
So it was in the middle of the 1980s that—to borrow Lucien Febvre’s concept of
the broad-shouldered European striding forward by flaunting his “civilization” and
“organization”—the European Community took another step forward with a dra-
matic “organizational push”: Widening to include the countries of southern Europe
(Spain and Portugal joined in 1986); committing itself to the fiscal and economic
discipline of the EMS; perfecting an internal market without customs barriers and
with more limited room for state intervention. This new organizational impulse,
made concrete by the Single Market project and signature of the Single European
Act in 1986—the first reform of the Treaties since 1957—would contribute to
profound changes in the daily lives of European citizens. These changes finally
confirmed both Aldo Moro’s concerns regarding the technocratic nature and
ambiguous identity of the integration process, and Ambassador Henderson’s warn-
ings about the strength of the Common Market as an indispensable instrument to
foster economic competitiveness and technological advancement.
On May 29, 1986 at the Berlaymont Palace, Jacques Delors, the President of the
European Commission, unveiled the Community’s new flag—with its circle of
twelve golden stars on a blue background—while Beethoven’s “Ode to Joy” rang
out for the first time as Europe’s new anthem. At the end of the ceremony, Delors
addressed the European media with proud and almost defiant words: “Europe has
acquired a size that will allow it to face the modern world and maintain its proper
status.”71 Only one year earlier, all the original founders of the EC except Italy had
signed the Schengen Agreement allowing for the free movement of people among
the participating countries. On a more symbolic level, Schengen also represented
the first official divide between citizens of the European Community and those
who the Italians, with a subtle note of contempt, would soon define as extracomu-
nitari (illegal aliens).

69
C. Grant, Delors: Inside the House that Jacques Built (London: Nicholas Brealey Publishing,
1994), p. 70.
70
J. Delors, Mémoires (Paris: Plon, 2004), p. 203.
71
C. Lager, L’Europe en quête de ses symboles (Berne: Peter Lang, 1995), p. 57.
260 After Empires

Toward the end of the 1980s Mikhail Gorbachev launched his project for a
“Common European Home,” implicitly renouncing global ideological competi-
tion and calling for greater strategic and economic collaboration with western
Europe. In a 1988 speech to eastern European leaders, he admitted: “To the west
of our borders there is a new giant developing, one with a population of 350 mil-
lion people, which surpasses us in its level of economic, scientific and technological
growth.”72 A year later, in his speech at the Council of Europe, that embodiment
of the idea of Europe from the Atlantic to the Urals, Gorbachev spoke about Euro-
pean unity along the lines of Victor Hugo and of the need to defend national
sovereignty:
Let us not forget, however, that the curse of colonial slavery spread worldwide from
Europe. Fascism was born here. The most devastating wars began here. Europe may
take legitimate pride in its accomplishments, but it has far from paid all its debts to
humankind. This is yet to be done. This is to be done by pressing for changes in inter-
national relations in the spirit of humanism, equality and justice and by setting an
example of democracy and social achievements in their own countries.73
But by that point, there was no room for collaboration between two different
social and economic systems in Europe. The nations of the European Community
had decided to launch their own new strategy as a response to the explosive struc-
tural changes in international economic relations and within European politics
and society at the end of the 1970s. This strategy allowed for less economic sover-
eignty for nation states and asked for more homogeneity. Antifascism and “the
burden of colonialism” were concepts entirely out of tune with the revisionistic
cultural and political atmosphere prevailing in western Europe.74
The audacious project of the Single Market that contributed to changing so
dramatically the everyday lives of ordinary European citizens, as well as broader
European social and political structures, would soon demonstrate all its appeal and
challenging force: For trade unions and political parties, for those university stu-
dents enthusiastically enrolled in study abroad through the Erasmus program,75
and even for those living in the communist countries of eastern Europe. At the
same time, from a longer-term perspective, it is justifiable to retain doubts about
whether Europe—a civilization in continuous expansion since the sixteenth cen-
tury, which in 1939 still directly controlled somewhere between 60 and 70 percent
of the globe—would recover its cultural vitality, faith in progress, and popular
appeal, after its defeat in the Second World War and the further contraction of

72
M. Cox, “Who Won the Cold War in Europe? A Historiographical Overview,” in F. Bozo, M.P.
Rey, N.P. Ludlow, and L. Nuti (eds), Europe and the End of the Cold War: A Reappraisal (London:
Routledge, 2008), p. 14.
73
“Document No.73: Address by Mikhail Gorbachev to the Council of Europe in Strasbourg, July
6, 1989” in S. Savranskaya, T. Blanton, and V. Zubok (eds), Masterpieces of History: The Peaceful End
of the Cold War in Europe, 1989 (Budapest: Central European Univerity Press, 2010), p. 493.
74
For some insightful comments on the cultural changes in the “core” European countries during
the 1980s, see P. Anderson, The New Old World (London: Verso, 2009).
75
S. Paoli, Il sogno di Erasmo. La questione educative nel processo di integrazione europea (Milan:
Franco Angeli, 2010).
 Managing Globalization 261

decolonization, that would allow it to construct a new—and this time peaceful—

model for the rest of the world.76 Certainly the European Community had strength-
ened itself, but it had not managed to become the center of a new universalism, in
a world with new regional actors that were now imposing themselves on the two
superpowers of the Cold War. This was perhaps a task beyond Europe’s reach,
which only the optimism that followed the social explosion of the global 1968 had
made seem possible and which had inspired the optimistic declarations of the 1972
Paris Summit.77 In his book Capital Rules, Rawi Abdelal describes the struggle
between “ad hoc” and “managed” financial globalization in the 1980s. The US, and
to a certain extent the UK, preferred an “ad hoc” approach based on hands-free for
their rich financial institutions so that they could operate freely on the interna-
tional markets. Their underlying idea was that, eventually, profit-making by private
banks would prove beneficial to the home country. The French, on the other
hand—especially after Mitterrand’s failed efforts in establishing “socialism in one
country”—started to support the free movement of capital, but within the rules set
by multilateral institutions such as the IMF. In fact three or four of the main “glo-
balizers” of finance in the 1980s were French.78 The Single Market project was
based on the same idea: a reversal of the “embedded liberalism” of the first Bretton
Woods era. It implied deregulation and reduction of the role of the state within the
Single Market area, and at the same time an effort to impose an EC point of view
in the international economic institutions that set the rules of globalization.

76
See S. Lucarelli, “The EU in the Eyes of Others: Towards Filling a Gap in the Literature,” in
(2007) 3(20) European Foreign Affairs Review, pp. 249–70.
77
E.W. Said, Reflections on Exile, and Other Essays (Cambridge, MA: Harvard University Press,
2000), p. 432.
78
Rawi Abdelal, Capital Rules. The Construction of Global Finance (Cambridge: Harvard University
Press, 2007).
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Venezuela
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International Economic, Political, and Social Organizations

Archivio Ente Nazionale Idrocarburi (ENI), Pomezia
Estero
Archives du Groupe Total (TOTAL), Paris
Food and Agriculture Organization (FAO), Rome
Economic and Social Committee (ESC)
International Institute of Social History (IISH), Amsterdam
European Trade Union Confederation (ETUC)
Socialist International (SI)
United Nations Office in Geneva (UNOG), Geneva
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World Bank Group Archives (WBGA), Washington, D.C.
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Internet Sources:
Archive of European Integration in Pittsburg:
<http:// aei.pitt.edu>
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<http:// http://www.wilsoncenter.org/program/cold-war-international-history-project>
European Oral History (European Commission 1958–72)
< http://www.eui.eu/HAEU/EN/OralHistory.asp>
European Navigator:
< http://www.cvce.eu/>
G8 Information Centre:
<http://www.g7.utoronto.ca>
Margaret Thatcher Foundation:
< http://www.margaretthatcher.org/archive/default.asp>
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<http://gwu.edu/~nsarchiv/>
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Le Monde (Paris)
Le Nouvel Observateur (Paris)
La Repubblica (Rome)
Le Soir (Brussels)
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 Index
Abbagnano, N. 56 General Agreement on Tariffs and Trade
Abdessalam, B. 187, 198 (GATT) 20, 23, 24, 30, 38, 39, 41, 42,
Adenauer, K. 81 65–9, 73, 77, 132, 153, 156
Affluent society 20 International Bank for Reconstruction and
Afro-Asian Economic Summit 43 Development (IBRD) 20, 41
Agnelli, G. 93, 207, 251 International Development Association
Algerian war 95 (IDA) 29, 224, 226
Allende, S. 125, 136–1, 162, 188, 201 International Monetary Fund (IMF) 20, 36,
Alliance for progress 29 41, 42, 61, 73, 208, 220
Andean pact 150, 182 Kennedy Round 73, 89
Arab petroleum congress 34 Tokyo Round 140, 217
Armand, L. 46 Brezhnev, L. 72, 202
Aron, R. 70, 93, 124, 163 Bruckner, P. 251
Asor-Rosa, A. 113 Brzezinski, Z. 212
Association of South-East Asian Nations Burke, R. 133
(ASEAN) 150 Burri, A. 62
Attalì, J. 172
Attlee, C. 8, 51 Calchi Novati, G. P. 143
Calvino, I. 113
Baader, A. 87 Càmara, H. 105
Bairoch, P. 33, 34 Camp David 244
Baran, P. 33 Camus, A. 95
Barraclough, G. 2 Carli, G. 61, 122, 207
Barre, R. 149, 211 Carlsson, B. 232, 236
Barth, F. 114 Carr, E. H. 15, 163
Bauer, O. 58 Carter, J. 94, 212, 225, 227, 244
Beatles, The 113 Cascia, R. 56
Bedjaoui, M. 183 Castells, M. 247
Beethoven, L. V. 259 Castro, F. 16, 18, 98, 114, 136, 175, 215, 242
Ben Bella, A. 43, 75 Catholic world
Benn, T. 237 Encyclical Pacem in Terris 82
Berlinguer, E. 172, 219, 239 Encyclical Populorum Progressio 83
Bettelheim, C. 116 Liberation Theology 106
Beveridge, W. 173 Chaban- Delmas, J. 100,125
Bildeberg Group 93, 127, 207, 249, 258 Chamberlein, A. 51
Black Dwarf 104 Charles river group 27, 28
Black E. 29 Cheysson, C. 193, 217, 224, 238
Black Panthers 107, 109 Chirac, J. 211
Blanchard, F. 201 Churchill, W. 23
Boertien, K. 144 Cleaver, E. 107
Boumedienne, H. 3, 75–6, 175–7, 185, Club of Rome 234
235, 245 Cohn-Bendit, D. 108
Bowles, C. 85 Colombo, E. 143
Brandt report 239 Colonna di Paliano, G. 128
Brandt commission 238 Commoner, B. 120
Brandt, W. 87, 122, 124, 160, 171, 188, 204, Confédération Française Démocratique du
231, 235, 254, 256 Travail (CFDT) 123
Brasseur, P. 38 Confederation General du Travail (CGT) 64
Braudel, F. 190 Confederazione Generale Italiana del Lavoro
Bretton Woods 20, 21, 42, 135, 179, 206, 208 (CGIL) 63
Bretton Woods system Conference of OPEC heads of state
Committee of Twenty 140 (Algiers) 198
288 Index
Conference of the Organization of African eurafrique 45, 48
Unity 19 Euratom 46, 47
Cooper, F. 10, 45 European Coal and Steel Community
Cooper, R. 94 (ECSC) 1, 5, 45
Corea, G. 223 European Defence Community 46
Craxi, B. 237 European Economic Community (EEC, later
Crispi, F. 51 EC) 3, 5, 30, 35, 36, 38, 45- 8, 64, 72,
73
Dahrendorf, R. 149 European Free Trade Association (EFTA) 193
Davignon, E. 199 European Monetary System (EMS) 215, 229,
de Gaulle, C. 32, 38, 48, 49, 61, 69, 70, 92, 236, 257
94, 101,148 European Round Table (ERT) 258
de Guiringaud, L. 199, 218 European Trade Union Confederation
De Vries, M. 247 (ETUC) 129, 192, 253
Debray, R. 238 European University Institute (EUI) 80, 123
Debré, M. 87 Fouchet plan 48
Debunne, O. 234 gymnich Formula 188
Decade of development 39 Hague summit 123, 127, 141, 158
Dehousse, F. 45 Lomé Convention 190–3
Dekker, V. 258 Mansholt Plan 129
Del Boca, A. 252 Merger treaty 45
Dell, S. 135 monetary snake 184
Delors, J. 125, 259 Schengen 259
Den Uyl. Y. 125, 143, 213, 218 Single Market 4, 5, 249, 258, 259, 260
Development Assistance Commission Treaty of Rome 46, 47, 146
(DAC) 30 Yaoundé Convention I 36, 48, 49, 65–69,
Dhar, P. N. 180 86, 131
Dien Bien Phu 9 Yaoundé Convention II 52
Dostoyevsky, F. 95 year of Europe 183, 206
Duchêne, F. 161 European Christian Democratic Party 126
Dulles-Foster, J. 12, 16, 17
Dumoulin, M. 146 Faisal, King 34, 194, 196
Duroselle, J. B. 140 Fanon, F. 33, 95
Dutet, P. 224 Febvre, L. 54, 259
Dutschke, R. 90, 102, 108 Feltrinelli, G. G. 98
Ferrandi, J. 49
Easterling, R. 120 Ferry, J. 51
Echeverría, L. 140, 182 Flanigan, P. 151
Economic Commision for Latin America Food and Agricolture Organization (FAO) 74
(CEPAL-Spanish acronym) 25, 26 Ford Foundation 93, 114
Eden, A. 9 Ford, G. 196 197, 199, 207, 208, 216
Eisenhower, D. 16, 17 Forthomme, P. 42
Emmanuel, A. 116 Franco, F. 203
Ensslin, G. 90 Frank, A. G. 26
Ente Nazionale Idrocarburi (ENI) 60, 82 French May 91, 101
Enzensberger, H. M. 102 Frish, D. 191
Epinay congress 125 Froment-Meurice, H. 221
Eppler, E. 128 Front Liberation National (FLN) 9
Erhard, L. 93 Fulbright program, 93
European Community (European Union)
Action Committee for United States of Gaia, R. 173
Europe 163 Galbraith, J. K. 10, 24, 63, 93, 233
Association of the African States and Galeano, E. 115
Madagascar (AASM) 35, 36, 48, 77, Gallagher, J. 20
145, 150, 190 Gallino, L. 96
Beyen Plan, 46 Gandhi, I. 7, 10, 85, 180
Common Agricoltural Policy (CAP) 38, 62, Gardner, R. N. 23
65, 127, 184 Gemelli, G. 190
Common Market 5, 4, 6, 47, 64, 78,111 Generalized System of Preferences (GSP) 179, 242
Erasmus program 260 Gentile, E. 2
 Index 289
Giglio, C. 55 Kreisky, B. 126, 171, 189, 231, 255
Gilpin, R. 205 Kindelberger, C. 163
Giscard d’Estaing, V. 70,144, 195, 197, 203, Kwan Yew, L. 173
206, 209, 211, 216, 218 Krasner, S. 183
Gorbachev, M. 260 Kohl, E. 238
Gorz, A. 233 Khomeini, R. 245
Gromyko, A. 64, 72, 245 Khrushchev, N. 16, 22, 64, 72
Group of Seven (G7) 1, 203, 206, 214, 226 Kennedy, J. F. 18, 28, 29, 30, 38, 44, 64
Guevara, E. (Che) 41, 43, 44, 69, 88, 98 Keynes, J. M. 21, 24, 25, 119
Guzmàn, J. A. 17
La Pira, G. 105
Haiter, T. 116 Lagrou, P. 47
Hallestein doctrine 81,128 Lall, K. B. 85, 252
Hallestein, W. 66 Late colonial shift 47, 48, 51, 52
Harrod, R. 21, 60 Latin American Free Trade Association
Hayek, F. 60 (LAFTA) 44
Heath, E. 66, 77, 86, 121, 160 Lawson, N. 250
Helsinki conference 177, 201, 205 League of Arab States 71
Henderson, N. 241, 242 Ledda, R. 239
Hirschmann, A. 25 Lenin, V. I. 7, 16
Ho Chi Minh 58 Leopold II, King 51
Hobsbawm, E. J. 90, 113, 168 Lewis, A. 25, 31,178
Holland, S. 172 Lewis, J. 18
Hugo, V. 260 Lewis, S. 113
Huntington, S. 96 Library group 206
Hussein, S. 245 Lipponer, P. 233
Louis, W. R. 7
Ideal-X (ship) 97 Lubbers, R. 257
Illich, I. 119, 149 Lumumba, P. 9, 16, 56, 201
Institute for Relations between Italy, Africa, Luns, J. 80
Latin America and Middle East
(IPALMO) 143, 170 Macmillan, H. 13, 68
Institute of World Economy and International Mahmood, M. 38
Relations (IMEMO) 16 Mailer, N. 107
International Confederation of Free Trade Malcom, X. 18
Unions (ICFTU) 63 Malfatti, F. M. 141, 157
International Energy Agency (IEA) 22, 187 Malraux, A. 49
International Fund for Agricultural Manley, M. 231
Development 224 Mansholt, S. 74, 141, 146, 152, 160, 217
International Labor Organization (ILO) 117 Manto, S. H. 20
International Trade Organization (ITO) 23 Mao Tse Tung 114
Ivens, J. 60 Marchais, G. 149
Marcuse, E. 96, 149
Jacobson, P. 22 Marotta, G. 62
Jemolo, A. C. 56 Marseille energy conference 233, 236
Judt, T. 70 Marshall plan 9, 21, 22, 24, 44, 178
Jobert, M. 100, 186, 194 Martino, G. 157
Jalée, P. 115 Marx, K. 26, 33
Javits, J. 130 Maspero, F. 98
Jenkins, R. 212, 213, 214, 229, 236, 254 Mattei, E. 60, 82
Jospin, L. 238 Mau Mau revolt 9
Johnson, L. 23, 27, 77, 103 Mazower, M. 28, 247
McCloy, J. 22
Kennedy, R. 109 McGeorge, B. 114
King, M. L. 18, 109 McNamara, R. 118, 225, 234, 235, 248
Killick, T. 25, 31 McNeill, W. 93
Kaldor, M. 31 Meir, G. 188
Kennan, G. 99 Middlemas, K. 258
Kissinger, H. 122, 130, 163, 183, 185, 186, Milani, L. (don) 105
187, 196, 199, 203, 204, 209, 216, 223 Mill, J.S. 26
290 Index
Millikan, M. 27 Roncalli) 82
Milward, A. 3 Pope Paul VI (Giovan Battista Montini) 82
Mitterand, F. 55, 70, 125, 188, 204, 238, 255 Port Huron statement, 19
Mollet, G. 54 Portillo, L. 255
Mondale, W. 213 Powell, E. 112
Monnet, J. 46, 101, 163 Prashad, V. 11
Montly Review 33 Prebish, R. 3, 25, 26, 35, 39, 40, 41, 51, 74,
Moravia, A. 53 88, 116, 153
Moro, A. 125, 141, 159, 176, 210, 216, 219, Program for foreign leaders, 114
241, 242 Pronk, J. 143, 219
Morse, D. 117 Proudhon, P. J. 237
Mossadegh, M. 17, 168 Puerto Rico summit 211
Moynihan, D. P. 216, 249
Myrdal, G. 25, 63 Quaderni Rossi 95

Nurske, R. 25 Rambouillet Summit 209, 220

Naipaul, V.S. 52 Rauschemberg, R. 96
Natta, G. 62 Reagan, R. 247, 250, 254, 255
Nixon, R. 121, 151 Rey, J. 66
Neruda, P. 136 Risi, D. 83
Nierere, J. 243 Robinson, R. 20
National Association for Advancement of Rocard, M. 237
Coloured People (NAACP) 18 Rockfeller, D. 207
Nouvelles Equipes Internationales (NEI, later Rodney, W. 116
EUCD, European Union of Christian Roosvelt, T. 51
Democrats) 57 Rosenstein-Rodan, P. 25
Nkrumah, K. 13, 15, 31, 32, 43, 50, 69 Rossanda, R. 115
Nasser, G. A. 9, 12, 13, 16, 31, 38, 46, 50, Rostow, W. 25, 27, 28, 126
70, 71 Rote Armee Fraktion (RAF) 90
Nehru, J. 7, 10, 12, 16, 38, 43 Ruggero, R. 229
Ruggie, J. 20
Ohlin, G. 235 Rutten, C. 57
Olivi, B. 213
Organization for European Economic Sadat el, A. 196, 244
Cooperation (OEEC, later OECD) 28, Said, E. 251
30, 38, 42, 77, 82, 187, 214, 234 Sandri, R. 4, 142
Organization of African Unity 32 Santa Cruz, H. 38, 139
Organization of Petroleum Exporting Countries Sartre, J. P. 70, 95, 237
(OPEC) 34, 35, 176, 180, 181, 216, Sauvy, A. 11
220 Schlesinger, A. jr. 28
Ortoleva, P. 101 Schmidt, E. 93, 203, 206, 209, 216, 227, 232,
Ortoli, X. 210 246, 253
Ortona, E. 216 Schumacher, E. F. 120
Schumpeter, J. 25
Palme, O. 104, 124, 171, 188, 204, 231, 236 Scitowsky, T. 25
Pannikar, K.M. 10 Seers, D. 117
Pasolini, P.P. 95, 113 Senghor, L. 33, 231
Peace corps 18 Servan-Schreiber, J. J. 126
Pearson commission 128, 147 Shakespeare, W. 248
Pearson, L. 117, 128, 147 Sheenan, J. 5
Pecci, A. 120 Shepard, T. 55
Pedini, M. 83, 88, 147 Shihata, I. F. I. 181
Perez-Alfonzo, J. P. 34, 121, 176, 222 Shipway, M. 47
Perez-Guerrero, M. 135, 176, 202 Shonfield, A. 61
Pinochet, A. 162, 203 Silveira, F. 38
Pisani, E. 238, 256 Simonet, H. 196
Pitterman, B. 231 Six Day War 44, 70, 76
Pompidou, G. 100, 122, 125, 158, 167, 194 Smith, A. 26
Pope John XXIII (Angelo Giuseppe Smithsonian Agreement 131
 Index 291
Soares, M. 236 (NIEO) 162, 178, 195
Socialist International 58 Non Alligned Movement (NAM) 2, 12, 13,
Baden Baden Conference 58, 59 15, 35, 69, 70, 134, 175, 176, 215,
Israel Meeting 58 225, 242
Oslo Declaration 59 Thirdworldism 33, 92, 98
Société National Pour la Recherche, Prodution, Tri-Continental Solidarity Conference 43
Transport, Transformation et United Nations Conference for Trade and
Commercialization des Hidrocarbures Development (UNCTAD) 2, 3, 8, 25,
(SONATRACH) 176 35, 39, 40, 41, 42, 44, 63, 65–9, 73–8,
South-East Asia Treaty Organization 83, 234
(SEATO) 12 Geneva conference 36, 39, 40
Spaak, P.H. 50 Havana Conference 253
Special United Nations Fund for Economic Manila conference 243
Development (SUNFED) 29 Nairobi conference 223, 224
Spinelli, A. 141, 148, 149 New Delhi conference 73–8, 85, 131,
Stalin, J. 15 134
Stamp, M. 148 Santiago conference 134, 136,138–46,150
Stanovnik, J. 38 Thompson, E. P. 95
Sternhell, Z. 250 Tinbergen, J. 59, 80, 93, 234
Stoppard, T. 113 Tindemans, L. 126
Strategic Arms Limitation Treaty (SALT I) 151 Tito, J.B. 13
Students for Democratic Society (DS) 19 Tobin tax 141
Suez crisis 12, 31, 50 Toqueville, A. de 1
Sukarno, A.12, 43, 69 Torres, C. 105
Suri, J. 91 Toymbee, A. 4
Swaminthan, T. 85 Trentin, B. 107
Sweezy, P. 33 Trevor-Roper, H. 53
Triffin, R. 148
Talleyrand, C. M. 248 Trudeau, P. 222, 255
Tariki (al), A. 34
Tariq, A. 105 United Nations Conference on Trade and
Taviani, P. E. 57 Employement 23
Tawney, R. H. 10 United Nations Economic and Social Council
Thatcher, M. 247, 250, 257 (ECOSOC) 36
Third world (global south) United Nations 9, 13, 17, 19, 23
Afro Asian movement 43 University of friendship (Moscow) 17
Algiers charter 69–78
Altagracia charter 65 Van Miert, K. 25
Bandung conference 12, 69 Vance, C. 228
Bandung declaration 14 Vietnam war 70, 73, 98, 100, 103
Cairo declaration 35 Volcker, P. 246
Charter of economic rights and duties of Vredeling, H. 158
states 186, 220
Common fund for commodities 223, 224, Wallemberg Dinasty 93
227, 228, 254 Webb, S. and B. 10
Conference for International Economic Weiler, J. H. H. 78
Cooperation (CIEC) 220, 222, 225, Wesseling, H. 56
226, 227, 254 White, J. 116
Declaration on the granting of indipendence Wilson, H. 50, 51, 125, 209, 216
to colonial countries and peoples 13, 16 Wilson, W. 68, 75
Everest group 88 Woods, G. 29, 80, 93, 117
G77 joint declaration 42 World Bank 21, 22, 36, 44
Group of Seventy seven (G77) 36, 38, 44, World Federation of Trade Unions (WFTU) 64
72–8, 135, 222 World Trade Organization (WTO) 36, 38
Havana charter 23, 36
Havana summit of Non Aligned 242, 245 Yamani, A. Z. 194
Lima charter 135
New International Economic Order Zagari, M. 83, 87, 142