ABSTRACT
For over a decade successive US administrations tussled with economic defence policy. They tried to develop a strategy and justification for it that had more connection with contemporary reality than the strategic embargo’s original rationale of damaging communist states, restricting their development of high-technology weaponry and slowing down their economic growth. Gradually, during the 1960s, a new strategy took shape, at least in theory. It subsumed some of the old dispensation, but also introduced radical changes. This new formulation of economic statecraft for dealing with communist states involved five main characteristics: a gradual liberalisation of trade; tactical bargaining for various kinds of political and economic benefits; the retention of the capability to convey messages and moral opprobrium in response to communist misbehaviour; a determination to keep the highest forms of military and dual-purpose technology out of communist hands; and a deep concern that economic controls should not be reduced in such a way that they incurred heavy psychological costs for the West. However, because of public and congressional opinion, and the problems thrown up by the Vietnam War, it was not possible to implement these new ideas in any substantial way in the 1950s and 1960s. For Eisenhower and Rostow, and other key decision-makers during this period of unconsummated change, the fear of sending out the wrong psychological message, if the USA were drastically to liberalise trade with the communists, also held things back.
