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• 26 • 2. Peace Is Hell World War II left Europe in shambles. The victorious nations of Western Europe were destitute economically and militarily. Russia, which had liberated and now occupied the nations of Eastern Europe, stood as the major military and political force on the continent, while the United States, which had escaped the Great Depression at last, was the dominant economic and military power in the world. Long isolationist in its foreign policy, the United States now looked upon a world in which it was the primary defender of both the West and the liberal values for which the war had been fought. Its economic conversion from the production of consumer goods to the manufacture of aircraft, ships, and weapons of war had been remarkable for its speed and was decisive in the conflict. For President Harry Truman, however, the joy of victory turned quickly into the agony of reconversion and demobilization as the popular clamor for a return to a peacetime economy joined with that for the return of servicemen to civilian life. There were, however, no plans in place for either.1 The two atomic bombs dropped on Japan brought an abrupt end to the war to the surprise of military planners who knew nothing about the bomb, thought the war with Japan would continue at least into the fall of 1946, and had no plan for demobilization. Moreover, civilian planners, who accepted military estimates about the end of the war, had no plan for the return to a peacetime economy. The result was that the postwar period, in the words of Robert J. Donovan, “broke around [Truman’s] head with thunder, lightning, hail, rain, sleet, dead cats, howls, tantrums, and palpitations of panic.”2 Memories of the 1930s were still fresh in the minds of Americans, and while the war years brought a new prosperity, the imminent return of millions of servicemen to the job market raised widespread fear among both • 27 • PEACE IS HELL the populace and policy makers that depression could once again be just around the corner. These fears were magnified in the two weeks following V-J Day when the government cancelled hundreds of wartime contracts for the production of military goods, the result of which was that almost two million workers lost their jobs. Millions more saw the end of overtime work, which meant a 30 percent or greater cut in take-home pay, and still others were downgraded to lower-paying jobs. Labor problems began almost immediately as unions sought sizeable pay raises to make up for the diminished incomes of their members, but companies that had earned huge profits from wartime contracts rebuffed union demands. As trouble loomed, President Truman called for a White House meeting of management and union officials , hoping to bring about a peaceful resolution of their differences, but management resisted. A month passed before the conference was convened, and by then it was too late. Over the fall and winter and into the spring, strikes occurred in many of the nation’s major industries, beginning with Ford Motors and Westinghouse Electric and extending to coal miners, oil and gas workers, longshoremen, and eventually railroad workers. While strikes dominated the front pages of the nation’s newspapers, inflation was quietly emerging as the greater challenge to reconversion. Inflation had been seen as a wartime problem owing to the dramatic increase in government spending, and an elaborate system of rationing and controls had been put into place that effectively restrained it. After V-J Day, however, the Truman administration was anxious to remove price, wage, production, and other controls as quickly as practicable, but disputes arose immediately as to what was “practicable.” Conservatives wanted to move rapidly to privatize the economy, while liberals urged caution. The largely ideological struggle continued through the fall and into 1946 as all sectors of the economy—big and small business, banks, unions, and farmers—fought for advantage. Agriculture became a special problem. The United States increased shipments of grain and meat to Europe to stave off starvation on the continent, but this, in turn, created shortages of meat, wheat, and other products in the American market. Humanitarian in spirit, food was also a political weapon to resist Russian encroachment in the nations of Western Europe. Relations with the Soviets, never warm, had grown chilly with the end of the war, as Russian occupation of Eastern Europe seemed more and more a permanent feature of the European map and as control of...

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