The Lend-Lease Act, or the strategic dialectic of global powers between opportunity and opportunism

(To Nicola Cristadoro)
30/04/24

It is necessary to lay down some premises to try to understand the oxymoronic irrational logic of the "non-repayable" investments made by the great world powers. It is important to know, first of all, that they are not "non-refundable". They are rewarded with intangible values. One of all, the "power". I borrow the words of Dario Fabbri with some (his) useful considerations to understand the meaning of "power", particularly in reference to the United States and Russia, but above all, to understand how this "power" is founded not on dictated criteria by the rules of the economy, but rather by choices that, rationally, are absolutely uneconomic:

“The sole global hegemon, on an economic level the United States simply should not exist. Equipped with an immense public debt, a trade deficit never sustained before, industrial capacities in sharp decline, if they lived on the economy they would border on a failed state. But they remain dominators, because they are centered on power, unattainable in the geopolitical field. … They control the flow of shipping in every strait of the globe – although 70% of the cargo never reaches North America – and offer their nuclear deterrence to their customers. … It is impossible to divine the movements of the American superpower by applying interpretative categories of an economic nature, calculating only material profits…. It is essential for Americans to exist on the roof of the world. So they endure deaths in battle, the presence of limited domestic welfare, the injustice of their own society.

Russia is a state of insignificant economic and industrial value, capable only of selling what it does not produce (hydrocarbons). Yet it remains among the main powers in the world because it is obsessed with its own influence, with maintaining its geopolitical weight. Western elites get excited when anti-dictatorial demonstrations erupt in Moscow or St. Petersburg. But Russians do not live on wealth or economy, unknown categories, especially in the deep country. Rather, they judge regents by the goals they pursue in the international arena. … So Vladimir Putin is aware that he could end up in the history books of his country as the leader who lost Ukraine. A far more serious setback than any decrease in per capita income. A reason that makes the sanctions applied to the Russians almost useless, as they are strangers to Western well-being and are rather inclined to look with greater hatred at the West that imposes such measures."1

With regard to the United States, proof of what has been stated is offered by the aid package established by Washington in favor of various countries in crisis due to actual or potential wars, approved by Congress gathered in an extraordinary session on 20 April 2024. It consists of 95 billion dollars in military aid or support for real or possible war efforts, to be allocated to Ukraine (60,84 billion), Israel (26,38 billion) and Taiwan (8,12 billion). This, however, is only the latest example of a conduct which, according to the economic principles that guide the policies of a large part of the "Westernized" world (Japan and South Korea should also be considered), can only arouse perplexity: after all, when this aid is not "non-repayable", at least it is certainly not recoverable in full. And this is precisely the point. As we will see, one of the macro-parameters on which the United States has based its greatness is represented precisely by the enormous donations made to countries which, in this way, enter their orbit and are influenced by it, as beneficiaries of such generosity and, therefore, subject to a bond of gratitude. This is the assumption on which, objectively, the American empire is founded.

In the past, even traditionally enemy states such as the Soviet Union were, with good reason, recipients of such generosity. I'm referring to Lend-Lease Act (Rental and Loan Law), the topic of this examination, which I wanted to dust off to help understand the great (apparent) contradictions that regulate the relationships and balances, the latter always precarious, between these two global powers.

Il Lend-Lease Act is a legislative provision adopted on 11 March 1941 by the Congress and the President of the United States whose aim, initially, was to assist with suitable financial means, supplies of war materials and raw materials those European and non-European States which followed a policy judged consistent with the interests of the United States. At that date the United States had not yet entered the conflict and the measure was intended to maintain a semblance of neutrality on their part. Subsequently, following their entry into the war, the law served to maintain that aid until the military and political objectives shared with the Allies were achieved. The Lend-Lease Act it attributed to the US president the power to establish not only the materials to be distributed, but also the methods of reimbursement by the beneficiary countries; it was enough that these were declared satisfactory, at the discretion of the president himself. Supplies were sent where and when they were needed most. In 1941, when the Battle of Britain was raging, they were flown mainly to the United Kingdom. For the duration of the war, the Land-Lease it also contributed around 10% to Britain's overall food supply.2 When the war then spread to Africa, the Middle East, Australia and India, aid was sent to those areas. With the signing of the protocol in October 1941, the supply of goods with the Lend-Lease Act began to move towards the Soviet Union, in ever-increasing volume.

I want to focus my attention precisely on these supplies, due to the relevance of that historic resolution in favor of Stalin, in relation to the very recent one in support of Zelensky. Russia quickly forgot how the victory in the Great Patriotic War also benefited from a completely marginal contribution from its greatest historical enemy: the United States.

From 1941 to 1945, the Lend-Lease Act it supplied $11,3 billion worth of goods to the Soviet Union at the time (about $180 billion in today's currency).

In November 1941, in a letter to US President Roosevelt, Stalin wrote:

“Your decision, Mr. President, to grant the Soviet Union an interest-free loan worth $1.000.000.000 to meet deliveries of ammunition and raw materials to the Soviet Union is accepted by the Soviet Government with sincere gratitude as help vital to the Soviet Union in its tremendous and costly struggle against our common enemy: bloody Hitlerism.”3

In quantitative terms, it involved the sending of vehicles and materials in the quantities indicated below:4

► 400.000 jeeps and trucks;

► 14.000 airplanes;

► 8.000 tractors;

► 13.000 tanks;

► 1,5 million blankets;

► 15 million pairs of combat boots;

► 107.000 tons of cotton;

► 2,7 million tons of petroleum products;

► 4,5 million tons of food.

Many of the planes were transported directly from the United States to the Soviet Union via the northern route through Alaska and Siberia, others were packaged and shipped to the Persian Gulf, where they were assembled and transported to Russia.5 To the vehicles and materials listed above, 350 locomotives, 1.640 flatbeds and almost half a million tons of rails and accessories, axles and wheels must be added, all for the improvement of the railways which guaranteed logistical support to the Red Army on the eastern front. And more: miles of field telephone cables, thousands of telephones and thousands of tons of explosives, machine tools and other equipment to help the Russians produce their own planes, rifles, bullets and bombs.6

From the Cold War to the present day, many Soviet and Russian politicians have ignored or downplayed the impact of American assistance to the USSR, as well as the impact of the entire war waged by the United States and the United Kingdom, with the entire Commonwealth, against the Nazis.

The first official historical assessment of the role of Lend-Lease was given by the chairman of the State Planning Committee Nikolai Voznesensky in his book The military economy of the USSR during the Patriotic War, published in 1948:

“...If we compare the size of the supplies of industrial goods of the Allies to the USSR with the size of industrial production at the socialist enterprises of the USSR in the same period, it turns out that the share of these supplies in relation to domestic economic production during the war was only about 4%.”7

The 4% figure was published without detail and is disputed.

“For those interested in history, there was one canonical fact: Lend-Lease supplies amounted to 4% of the volume of industrial production of the USSR during the war. It was published without further comments in his book "The Military Economy of the USSR during the Patriotic War" by the chairman of the State Planning Committee, Nikolai Voznesensky, later shot following the Leningrad Affair.8 It is unclear how Voznesensky and his collaborators calculated these percentages. It was difficult to estimate Soviet GDP in monetary terms due to the ruble's lack of convertibility. If it was a question of units of materials, then it is not clear how tanks were compared to airplanes and food to aluminum.”9

In fact, this fact expressed in such an assertive way has become the main characteristic with which the Lend-Lease it was described in Soviet historical works. Voznesensky's assessment clearly contradicts data published in the post-Soviet era on the volume of Soviet production and the volume of deliveries within the framework of Lend-Lease.

La Brief History of the Great Patriotic War, also from 1948, recognized the shipments of Lend-Lease, but concluded: “On the whole this assistance was not significant enough to exert in any way a decisive influence on the course of the Great Patriotic War”.10

In 2015, Nikolai Ryzhkov, the last head of government of the Soviet Union, referring to the assistance provided to the USSR with the Lend-Lease Act  he stated that "it can be said with confidence that he did not play a decisive role in the Great Victory".11

These assessments, however, are contradicted by the opinions of the Soviets who were protagonists of the war. Already in Stalin's words quoted above there is gratitude towards the United States for the significant material support received. Another confirmation can be found on the occasion of the Tehran Conference of 1943, when Stalin, during a gala dinner in honor of Winston Churchill's 69th birthday, toasted the program of Lend-Lease with Churchill and Roosevelt. There are various translations of the words pronounced by the Soviet dictator from English sources and taken up by Russian commentators. The different versions, however, do not differ in substance so that without the "machines" supplied by America, the outcome of the conflict for Russia would have been very different. Below is one of the accredited and exemplary translations:

“I want to tell you what the president and the United States did to win the war, from the Russian point of view. The most important things in this war are the machines. The United States has demonstrated that it can produce between 8.000 and 10.000 planes per month. Russia can produce a maximum of 3.000 planes per month. England produces 3.000-3.500 per month, mostly heavy bombers. Thus, the United States is a country of machines. Without these Lend-Lease vehicles, we would have lost this war.”12

To testify to Joseph Stalin's thoughts regarding the Lend-Lease, there is also the authoritative opinion of Nikita Khrushchev shared with that of the dictator. The analysis of the facts presented by Khrushchev is lucid and, all things considered, honest:

“Great Britain and the United States have done everything in their power to provide us with material assistance of every kind, principally military assistance, in the form of armaments and other material support necessary for the conduct of the war. We received a lot of help. This was not, of course, generosity on the part of Great Britain and the United States, nor did they want to help the people of the Soviet Union, far from it. They helped us destroy the resources of the common enemy. In doing so, they fought with our hands, with our blood, against Hitler's Germany. They paid us to be able to continue fighting, they paid us with weapons and materials. From their point of view, it was reasonable. And it was really reasonable, and it was beneficial for us. After all, it was hard for us at that time, we paid a very high price in the war, but we had to do it, because otherwise we would not have been able to fight. A mutual interest arose and we established and continued to develop good relationships and mutual trust.

I would like to express my opinion and speak openly about Stalin's opinion on the question of whether the Red Army and the Soviet Union would have been able to cope with Hitler's Germany and survive the war without the help of the United States and Great Britain. First of all, I would like to talk about some remarks made by Stalin, which he repeated several times when we had "free conversations" with each other. He said bluntly that if the United States had not helped us, we would not have won the war: face to face with Hitler's Germany, we would not have resisted his onslaught and we would have lost the war. No one has ever officially discussed this topic in our country, and I don't think Stalin left written traces of his opinion anywhere, but I continue to maintain that he reiterated this aspect several times in conversations he had with me. He didn't speak specifically about this issue, but when we were just talking, discussing international political issues, present and past, and moving on to the topic of what we had to deal with during the war, this is what he said. When I heard his comments, I completely agreed with him, and now I agree even more.”13

The relevance of this agreement was also underlined by Politburo member Anastas Mikoyan, People's Commissar for Foreign Trade of the USSR during the war and, in his function, since 1942 responsible for receiving the Allied supplies assigned with the Lend-Lease:

“When American stew, butter, powdered eggs, flour and other products began to arrive, what a significant calorie intake our soldiers immediately received! And not just the soldiers: something also arrived from behind the lines. Or we take the supply of motor vehicles. Taking into account the losses along the way, as far as I can remember, in the end we received around 400.000 first-class motor vehicles for the time such as Studebakers, Fords, Willis and amphibious vehicles. Our entire army actually found itself on wheels, and what wheels! As a result, its maneuverability increased and the pace of the offensive increased significantly. … Without Lend-Lease we probably would have been fighting for another year and a half.”14

On the American side, then, Secretary of State Edward R. Stettinius reported the reasons given without hypocrisy by Senator Walter F. George, president of the Finance Commission during the war period, of why it was worth spending money on the program Lend-Lease:

“The nation now spends about 8 billion a month. If it had not been for the preparations we have made in recent months, gaining time, the war, I am convinced, would have lasted a year longer. We spend up to 100 billion dollars a year on war and, moreover, we lose a huge number of lives of the country's best sons. Even if we shortened the war by just six months, we would save 48 billion dollars, having spent only 11 (with Land-Lease, ed.) and the blood of our soldiers and the tears of our mothers are priceless..." 15

Before concluding, I also want to mention the Hula Project, a parallel program to Lend-Lease, during which the United States transferred naval vessels to the Soviet Union in anticipation of the Soviets joining the war against Japan, particularly in preparation for the planned Soviet invasions of southern Sakhalin and the Kuril Islands. Headquartered in Cold Bay, Alaska, the project was active during the spring and summer of 1945. It was the largest and most ambitious relocation program of World War II.

After receiving from the Soviet Union a list of necessary equipment - which the Americans code-named MILEPOST - the United States began work to meet Soviet requirements in addition to the annual allocations provided under the Lend-Lease.16

Under U.S. law, all vessels transferred overseas via Lend-Lease they were to be returned to U.S. custody after the conclusion of World War II, and in February 1946, the United States began negotiations with the Soviet Union for the return of the transferred ships. However, with the onset of the Cold War, relations between the Soviet Union and the Western Allies rapidly deteriorated, hindering the return of the ships.17

Ironically, the US Navy actually did not want to take back the ships because they were no longer useful and it would have been expensive to take custody of and dispose of them; consequently some ships underwent a purely administrative transfer to the custody of the United States, to comply with the law. The Soviet Union transferred two minesweepers to the People's Republic of China; of the other 97 ships of the Hula Project 81 were sold to the Soviet Union for scrap and 16 were sunk off Nakhodka.18

What conclusions can we arrive at, looking beyond the mere factual aspects of past and present history?

Russia should reflect on its past and, beyond its para-imperial reasons, understand the extent of the damage caused by an ahistorical vision of the present, with the attempted annexation of Ukraine to its "empire". It should not be surprising that the United States wanted to apply a form of Lend-Lease towards Ukraine.

On the other hand, the United States should be a little more prudent and avoid rash gestures such as the choice to refuse, when the opportunity arose, a constructive dialogue with Russia. It was a gratuitous humiliation, the outcome of which is there for all to see. A little more foresight would have made the most powerful democracy in the world understand that perhaps it was a good opportunity to forge a anti-Chinese coalition, without so many useless proclamations and waste of energy with fleet movements and behind-the-scenes plots. Instead, now, the Moscow-Beijing axis has consolidated, despite the ancestral rivalry between the two countries.

The samples of the Realpolitik of which Kissinger was the undisputed master are struggling to maintain their primacy on the globe, while the Middle Empire, strong in the proverbial Taoist calm, waits sitting on the bank for the corpse of the enemy (or enemies) to pass by carried by the river .

1 D. Fabbri, Human Geopolitics, Gribaudo, 2023, pp. 110-113.

2 https://www.historians.org/about-aha-and-membership/aha-history-and-arch...(1945)/how-much-of-what-goods-have-we-sent-to-which-allies.

6 Ibid.

7Helped whether allies the USSR в the war? (Did the allies of the USSR help in the war?), Dzen, 28/04/2020. https://dzen.ru/a/Xqf_dzbPb0AeGO7T.

8 The expression “Leningrad Affair” indicates a series of trials that took place between the end of the 40s and the beginning of the 50s against some important Soviet political figures, accused of having given rise to a current hostile to the central power .

9 A. Krechetnikov, "Садовый шланг" Франклина Рузвельта (Franklin Roosevelt's “garden hose”), BBC Russian, 29/06/2007. http://news.bbc.co.uk/hi/russian/russia/newsid_6248000/6248720.stm.

10 R. Coalson, “We Would Have Lost”: Did US Lend-Lease Aid Tip The Balance In Soviet Fight Against Nazi Germany?, Radio Free Europe-Radio Liberty, 07/05/2020. https://www.rferl.org/a/did-us-lend-lease-aid-tip-the-balance-in-soviet-....

11 Ibid.

12 V. Nagirnyak, Тост за ленд-лиз (Toast to Lend-Lease), Warspot, 05/12/2017. https://warspot.ru/10639-tost-za-lend-liz.

13 N. Khrushchev, Послевоенные размышления (Post-war reflections). http://militera.lib.ru/memo/russian/khruschev1/28.html.

16 R. A. Russell, Project Hula: Secret Soviet-American Cooperation in the War Against Japan, Naval Historical Center, Washington, DC, 1997, p. 8.

17 R. A. Russell, op. cit., p. 37.

18 RA Russell, op.cit., p.38.

Photo: IWM/web/US Navy