Backstory to the Berlin Airlift: The Imperative of Currency Reform
By the start of 1947, the United States and Britain had abandoned their illusions of post-war cooperation with the Soviet Union -- without yet viewing themselves in a state of "Cold War." Despite Churchill's warnings about the "Iron Curtain" and growing evidence of Soviet bad-will, the United States was still reluctant to confront the Communists openly and directly. Instead, the U.S. focused on moving ahead with policies designed to kick-start the European economy with -- or without -- Soviet cooperation. Central to this policy was the creation of a sound banking system, a currency to replace the barter economy, and the creation of an independent and sovereign German state. The Soviet Union too had repeatedly proclaimed its interest in a currency reform – provided it had control of the currency. With respect to an new German government, the Soviets were working diligently toward this goal through their Party cadres and with the help of the Secret Police....