Authors

Discussion

The aim of my presentation is to explore Yugoslavia’s development strategy in a volatile international context after World War II. Contrary to viewing Yugoslavia’s early years as defined by a centralized Stalinist state, I wish to argue, that by April 1946, the Communist Party of Yugoslavia had embraced Lenin’s New Economic Policy as the basis of its development strategy. This strategy, relying on market elements, peasant initiative and foreign trade, aimed to secure two central goals of Yugoslav socialist project: social development and national sovereignty. However, it was faced with the adverse challenge of post-war reconstruction, infrastructure rebuilding, and heavy industry investment. It put the leadership in front of a dilemma: how to finance capital imports needed for defense and industrialization while averting social unrest due to low wages, austerity and scarce consumer goods. They decided to adapt the original strategy with centralized “political” and “economic” methods, including large-scale mobilizations, shock work, and production brigades, along with strict control over wages and promotion of managers’ authority.

Although United Nations Relief and Rehabilitation Administration (UNRRA) assistance from 1945 to 1947 enabled the balance between industrialization and consumer goods provisions, tensions with the “West” arose in 1946 when Yugoslavia downed two American warplanes. As the 1948 conflict with Stalin escalated, Yugoslavia became isolated from both “East” and “West.” In 1949, the U.S. decision to “keep Tito afloat,” enabled its economic survival. While many historians, take the break-up with the Soviet Union as an inflection point for Yugoslavia, I will argue that the decision by the U.S. is no less important. Subsequent U.S. grants over eight years fueled Yugoslavia’s industrialization, military recovery, and the return to its Leninist basis. It reoriented the Yugoslav trade towards the “Western” Europe, but Yugoslavia’s ultimate alignment with the “West” would come after economic success in the mid-1950s and another rupture with the Soviet Union in 1957.