Military Wishes and Economic Realities. The NATO Temporary Council Committee and the Build-up of the Dutch Armed Forces, 1951-1952
by Dr. Jan Hoffenaar
Institute of Military History, Royal Netherlands Army
presented at the “Economic aspects of defence through the major world conflicts”, XXXth International Conference of Military History, Rabat, 1-7 August 2004
On 2 April 1951, NATO Supreme Headquarters Allied Powers Europe – from then on commonly referred to by its abbreviated form of SHAPE - became operational. America’s ‘liberation’ general, Dwight D. Eisenhower, returned to the European continent after an absence of six years, this time in the capacity of Supreme Allied Commander Europe. SHAPE and Eisenhower were the first visible signs of what Lawrence Kaplan denoted the ‘militarisation’ of NATO. This process was not without the necessary obstacles, however. For this reason, Eisenhower’s staff was compared in those days to the Venus de Milo: “All SHAPE and no arms.”
Military Wishes and Economic Realities
What was going on? And why do I raise the issue of NATO’s problematic militarisation process at this conference, which is devoted to the subject of ‘war and economy’, to put it simply? For the military, first of all, the Cold War, at that point in time, was really a hot war that was waiting to begin. There were many who feared that, before long, events would prove them right. This fear was mainly inspired by the North Korean invasion of South Korea, just under a year before, in June 1950, which was supported by both communist China and the Soviet Union. That had set everyone’s alarm bells ringing. Would Western Europe be the next? The US president Truman and his staff, in the mean time, were not going to sit idly by. They put the European member states under immense pressure to step up their defence effort. Although they did so, it was still not to the satisfaction of the Americans.
This brings us to the second element in the argument that I am trying to make, the economic aspect. A further increase in the European defence effort would cripple the European economies. It would send up the prices of the essential raw materials, while seriously impairing the trade balance and the balance of payments position. European pessimists argued that this would eventually bring the West to its knees in the Cold War. The economically, socially and therefore politically acceptable limits to the European potential for rearmament had been reached. I will return to this point when I come to the Dutch situation. For our present purposes, suffice to say that in mid-1951 the United States and the European member states held widely divergent views on burden sharing. The European states regarded their current, already overstretched defence programmes as the maximum achievable, whereas the Americans felt that the Europeans were not nearly doing enough. You will hardly be surprised to learn that it was particularly the cynics among the Americans who dubbed NATO defence in Europe as “all SHAPE and no arms”.
It was not just the Americans, however, who felt there was no time to lose, the most senior military NATO bodies, too, were pressed for time. At first, they had designated the end of 1954 as the deadline for the build-up of the Allied defence. In the spring of 1951, however, they set different priorities. They urged all member states to do their utmost to have as many combat-ready troops by as early as the end of 1952. Eisenhower’s deputy and good acquaintance from the days of the Second World War, the British field marshal Montgomery, earmarked 1 December 1952 as the “Master Date”. “The Russians will have to decide by then whether to attack in the West, or not: on the premise that if they waited much longer they would find us too strong.”
It turned out to be far from simple to break the deadlock in the American-European dispute on the build-up of the NATO defence. At the time, some formulated the dilemma as follows: Which posed the bigger threat, “inflation or invasion”? There was much at stake. The “inflation or invasion” paraphrase hid issues such as the scope of the American economic and military aid to Europe, the mobilisation of the West-German economic and military potential in the interest of the European Defence Community and a European army, and the willingness of sovereign states to disclose and discuss their economic and military plans in detail in the various NATO bodies.
The Temporary Council Committee
The nail was hit on the head at the North Atlantic Council in Ottawa, Canada, of September 1951. The Council set up a Temporary Council Committee, the TCC, which was tasked with making an analysis of “issues involved in reconciling on the one hand the requirements of external security, in particular in fulfilling a military acceptable NATO plan for the defence of Western Europe, with, on the other hand, the realistic politico-economic capabilities of member countries.” All twelve member states appointed a ‘heavy-weight’ as their representative in the TCC. They were jokingly referred to as the “Twelve Apostles”. They appointed an executive office from their midst, comprising three highly prominent diplomats or politicians, who were rightly referred to as the “Three Wise Men”: the American Averell Harriman, the Briton Sir Edwin Plowden and the Frenchman Jean Monnet.
The ‘brainwave’ was the reconciliation, through consultation, of the military effort and the financial-economic support in each country individually. In this way, a sharing of the burden was achieved that was acceptable to each country. Two birds were killed with one stone. Firstly, the purely military requirements and the financial-economic restraints were charted for each country and brought to bear on each other. This was done by means of a time-consuming but effective process of considering the issue from both sides. Questionnaires were filled in, exploratory consultations held and tests taken. The latter is to say that each member state was closely questioned concerning its defence effort.
Secondly, the TCC method effectively ended a year long quest for a widely applicable formula for a fair and objective distribution of the burden. NATO mainly derived its resources from contributions in kind by its members, in the form of troops, materiel, the use of territory and other facilities. It had proved impossible to express these contributions in figures or in financial terms, relate them to the economic and social support of the country in question as expressed in these same financial terms, and determine whether they were in proportion to the contributions made by other countries.
The TCC procedure resulted in a plan of action and concrete recommendations in military, economic and organisational terms, both for the NATO organisation as a whole and for the individual member states. The recommendations related to, among others, standards of readiness of forces, improvement of training and organisation, establishment of more adequate machinery for supply and production planning, application of priorities in the assignment of equipment, development of adequate provisions for logistic support, and improvement and completion of command arrangements. The core concept was flexibility. The 1952 force targets and standards, only, were to be regarded as ‘firm goals’; for the years to follow, it had to be possible to make adjustments. This reconciliation process would then have to be repeated yearly and laid down in detailed annual reviews. This was done accordingly. The TCC report was approved by the member states at the Lisbon NATO Council of February 1952, and the review process, which we have to this day and which may be looked upon as the life blood of the organisation, was introduced here.
The Build-Up of the Dutch Armed Forces
The TCC operation led to a change of course in all member states in respect of the planned build-up of the armed forces. This is clearly illustrated by the Netherlands armed forces, specifically the Royal Netherlands Army. In 1951, the Dutch government, as a result of the war in Korea and the pressure brought to bear on it by the United States, had nearly doubled its defence budget and stepped up the build-up of the land forces. At the end of 1954, the Netherlands would have five divisions, one of which would be combat ready. In order to make this possible, the government had recourse to a set of draconian measures, at a time when the Dutch economy had been weakened by the adverse consequences of the war in Korea. The measures pushed up the prices of the basic necessities of life, such as bread, butter and fats, forced up the tax burden and slowed down the construction of new houses despite the then desperate housing shortage. The economically, socially and therefore politically acceptable limits to the Dutch defence effort had been reached.
But still, it was not enough. At the instigation of the TCC, a separate committee devoted itself to the composition of the available armed forces and the plans for the further build-up of these forces. This so-called Screening and Costing Staff was presided over by the American general McNarney. McNarney and his staff based themselves on two starting points, neither of which were entirely reconcilable with the Dutch army leadership’s plans. The first was that an army division was considered to have reached full strength, and so full combat readiness, only after having been reinforced by the required higher level supportive and administrative units. The divisions and the accompanying corps troops, also referred to as ‘slice’, were to be formed simultaneously. This was not all provided for in the Dutch plans. The second starting point embraced by McNarney concerned the criteria for determining the degree of combat readiness of the divisions. In his view, this depended on the percentage of the available military personnel in peacetime. This introduced a serious disadvantage where the assessment of the combat readiness of the Dutch regular and conscript army was concerned, as it was mainly composed of mobilisable units. Particularly when you take into account the fact that the degree of combat readiness determined the setting of American priorities for the allocation of arms supplies.
In concrete terms, McNarney asked the Netherlands to commit to having three divisions with slice, one of which was to be combat ready, as early as the end of 1952, while it was to have five full divisions, two of which combat ready, by the end of 1954. To do so, the defence budget, which had already been doubled, had to be doubled yet again. That was clearly more than the Dutch could deliver. A month of intensive consultations followed, in which, in addition to the TCC, the American government, the organisations responsible for the American arms supplies and SHAPE were also involved. The results of this process of given and take were highly diverse. The Netherlands committed itself to earmarking the so-called counterpart funds from the American aid, worth approximately half the annual defence budget, for defence purposes. In return, the Allies agreed to give the Netherlands more time to build up the required five divisions with supporting units. At the end of 1952, the Netherlands was required to have ‘just’ one army corps with three full divisions, one of which was to be combat ready. And, equally importantly, the prioritising of the American end item aid would be brought into line with the new arrangements. This would prevent the scenario, feared by the Dutch, of having well-trained troops without the required equipment.
Until recently, the results of the TCC operation, the celebrated and highly ambitious Lisbon force goals, received far more attention in the literature than the operation itself. The force goals were the hilarious evidence of the enormous impact and grip of the militarisation process in the wake of the Cold War on individual life and society in the West. It was soon recognised, in this interpretation of events that those goals were unattainable, and people were back with their feet on the ground again.
This reading, however, largely ignores the pivotal importance of the modus operandi introduced by the TCC. In recent years, this is gradually changing, to a large extent owing to the research conducted by Dr Helmuth Hammerich under the auspices of the Militärgeschichtliches Forschungsamt. The Temporary Council Committee developed a practical and integrated approach geared to harmonising the military requirements – which are always set at a maximum level – and the socio-economic constraints of individual member states, which always impose limitations. An important added advantage of this modus operandi was that the results brokered by the TCC were broadly supported by the member states. It laid the foundation for the Annual Review procedure, which, as I said before, is employed to this day. The example of the Netherlands shows that much can be gained by a strong, shared commitment to the principles of looking at both sides of the argument and a willingness to give and take. The Venus de Milo had “taken up arms”. And, to pursue this metaphor of NATO even further: she was ‘shaping’ up very well and she was growing into a mature personality. Even though she was to reinvent herself time and again and overcome numerous ‘internal’ diseases, she was sound of mind and body. The West and NATO succeeded in striking and preserving in freedom the right balance between maintaining a strong economy and developing an effective deterrent. This was how the Cold War was ‘won’.
This paper was written on the basis of research of the NATO Archives in Brussels and various archives in the Netherlands, the most important of which are: the Military-Political Affairs Archives in the Semi-Static Archives of the Royal Netherlands Army.
- Helmut R. Hammerich, Jeder für sich und Amerika gegen alle? Die Lastenteilung der NATO am Beispiel des Temporary Council Committee, 1949 bis 1954 (München, 2003).
- Jan Hoffenaar, “‘Hannibal ante portas’: The Soviet Military Threat and the Build-up of the Dutch Armed Forces, 1948-1958”, The Journal of Military History, LXVI (2002) 163-191.
- Jan Hoffenaar, “‘To Be Defended, or Not To Be Defended?’ The Conundrum of the Main Defense Line in the NATO Central Sector at the Beginning of the 1950s” in: V. Mastny, A. Wenger, S.G. Holtsmark, NATO and Warsawpact 1949-1979: Threat perceptions, war planning, alliance management (published in the beginning of 2005).
- Ine Megens, American Aid to NATO Allies in the 1950s: the Dutch Case (Amsterdam, 1994).