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OPEC, International Oil, and the United States  

Gregory Brew

After World War II, the United States backed multinational private oil companies known as the “Seven Sisters”—five American companies (including Standard Oil of New Jersey and Texaco), one British (British Petroleum), and one Anglo-Dutch (Shell)—in their efforts to control Middle East oil and feed rising demand for oil products in the West. In 1960 oil-producing states in Latin America and the Middle East formed the Organization of the Petroleum Exporting Countries (OPEC) to protest what they regarded as the inequitable dominance of the private oil companies. Between 1969 and 1973 changing geopolitical and economic conditions shifted the balance of power from the Seven Sisters to OPEC. Following the first “oil shock” of 1973–1974, OPEC assumed control over the production and price of oil, ending the rule of the companies and humbling the United States, which suddenly found itself dependent upon OPEC for its energy security. Yet this dependence was complicated by a close relationship between the United States and major oil producers such as Saudi Arabia, which continued to adopt pro-US strategic positions even as they squeezed out the companies. Following the Iranian Revolution (1978–1979), the Iran–Iraq War (1980–1988), and the First Iraq War (1990–1991), the antagonism that colored US relations with OPEC evolved into a more comfortable, if wary, recognition of the new normal, where OPEC supplied the United States with crude oil while acknowledging the United States’ role in maintaining the security of the international energy system.

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Foreign Economic Aid  

Jeffrey F. Taffet

In the first half of the 20th century, and more actively in the post–World War II period, the United States government used economic aid programs to advance its foreign policy interests. US policymakers generally believed that support for economic development in poorer countries would help create global stability, which would limit military threats and strengthen the global capitalist system. Aid was offered on a country-by-country basis to guide political development; its implementation reflected views about how humanity had advanced in richer countries and how it could and should similarly advance in poorer regions. Humanitarianism did play a role in driving US aid spending, but it was consistently secondary to political considerations. Overall, while funding varied over time, amounts spent were always substantial. Between 1946 and 2015, the United States offered almost $757 billion in economic assistance to countries around the world—$1.6 trillion in inflation-adjusted 2015 dollars. Assessing the impact of this spending is difficult; there has long been disagreement among scholars and politicians about how much economic growth, if any, resulted from aid spending and similar disputes about its utility in advancing US interests. Nevertheless, for most political leaders, even without solid evidence of successes, aid often seemed to be the best option for constructively engaging poorer countries and trying to create the kind of world in which the United States could be secure and prosperous.