« Decisions: Life and Death on Wall Street by Janet M. Tavakoli: My Review | Main | The Volatility / Quantitative Easing Dance of Doom »

Presidents, Bankers, the Neo-Cold War and the World Bank 

 At first glance, the neo-Cold War between the US and its post WWII European Allies vs. Russia over the Ukraine, and the stonewalling of Greece by the Troika might appear to have little in common. Yet both are manifestations of a political-military-financial power play that began during the first Cold War. Behind the bravado of today’s sanctions and austerity measures lies the decision-making alliance that private bankers enjoy in conjunction with government and multinational entries like NATO and the World Bank.

It is President Obama’s foreign policy to back the Ukraine against Russia; in 1958, it was the Eisenhower Doctrine that protected Lebanon from a Soviet threat. For President Truman, the Marshall Plan arose partly to guard Greece (and other US allies) from Communism, but it also had lasting economic implications. The alignment of political leaders and key bankers was more personal back then, but the implications were similar to the present day. US military might protected its major trading partners, which in turn, did business with US banks. One power reinforced the other. Today, the ECB’s QE program funds swanky Frankfurt headquarters and prioritizes Germany's super-bank, Deutschebank and its bond investors above Greece’s future.

These actions, then and now, have roots in the American ideology of melding military, political and financial power that flourished in the haze of World War II.  It’s not fair to pin this triple-power stance on one man, or even one bank; yet one man and one bank signified that power in all of its dimensions, including the use of political enemy creation to achieve financial goals. That man was John McCloy, ‘Chairman of the Establishment’ as his biographer, Kai Bird, characterized him. The relationship between McCloy and Truman cemented a set of public-private practices that strengthened private US banks globally at the expense of weaker, potentially Soviet (now Russian) leaning countries.

John McCloy and the World Bank Twist

In 1947, President Truman selected then-partner at a Rockefeller law firm, John McCloy, to be the second president of the World Bank (or International Bank of Reconstruction and Development) that would provide financial aid to developing nations after WWII. McCloy demanded the ability to unilaterally restructure the nascent World Bank—absent Congressional debate –such that its bonds would be sold through Wall Street banks.

That linkage altered the future of global financial relationships, by  transforming the World Bank into a securities vending machine for private banks that would profit from distributing these bonds globally, while augmenting World Bank aid with private loans.

World Bank, IMF and other multinational entity decisions about aid vs. austerity or any other ‘reform’ requirements including opening border to private banks, would be controlled by the capital markets. Big private global banks arrange, underwrite and distribute World Bank bonds. Small banks in Greece did not. Financial assistance terms were established to follow a similar hierarchy.

During the Cold War, the World Bank provided funds for countries that leaned toward capitalism versus communism.  Political allies of the United States got better treatment (and still do). The Nations that private bankers coveted for speculative and lending purposes saw their debt loads increase substantially and their industries privatized.  Equally, the bankers decided which bonds they could sell to augment public aid funds, which meant they would have control over which countries the World Bank would support.  The World Bank did more to expand US banking globally than any treaty or entity that came before it.

The Marshall Plan and Eisenhower’s Rise

Another pillar of global reconstructive and foreign policy efforts, the Marshall Plan, would provide further a ide to “friendly” countries in the early years of the Cold War.  Truman unveiled the Marshall Plan in the spring of 1947. He presented it as a way to counter the threat of Communism, warning that Europe was disintegrating economically, and Truman feared Greece and Turkey would fall victim to Communist control. America’s new enemy was not Germany nor the Nazis but Communism and its associated countries.

Under the Marshall Plan, Congress approved $13 billion to aid Europe’s fight against Communism, and also to bolster prime trading partners for American industries and banks. As a result, more currencies became available for conversion into US dollars. The Marshall Plan wasn’t just about helping allies: but about spreading dollar domination.

Chase (now JPM Chase) Chairman, Winthrop Aldrich enthusiastically supported the Marshall Plan. To big banks, lending to developing nations and fighting Communism amounted to the same thing. Plus, the Marshall Plan effectively gave each major US bank its own European country to play in. From 1948 to 1952, Chase amassed the most deals in Europe, nearly $1 billion, followed by National City Bank (now Citigroup). 

Eisenhower, NATO & Bankers

In 1952, General Dwight D. Eisenhower was commander of the North Atlantic Treaty Organization (NATO), the new military alliance established between the United States, Canada, and leading Western European powers to deter Soviet expansion, and promote European political integration. NATO blended military, political, and economic power behind the mantra, “an armed attack against one or more of [the allied countries] shall be considered an attack against them all.”.  In practice, what held for military support, held for opening borders to dollar based trade and private banking business, too.

In the spring of 1952 Aldrich traveled to Europe with an entourage of power brokers to persuade Eisenhower to run for president on the Republican ticket. Upon election victory, Ike’s banker sphere of appointees included his secretary of war, Thomas Gates, who would later chair the Morgan Guaranty Bank (now JPM Chase), Aldrich who became Ike’s ambassador to Great Britain, and John McCloy, who would spend the Eisenhower years as chairman of the Chase National Bank (now JPM Chase) assuming Aldrich’s role.

Beside the Marshall Plan, the Truman and Eisenhower doctrines extended US military and economic support to nations that adopted US ideology and that were military allies. Overseas offices of major US banks subsequently swelled to accommodate all the private loan demand that accompanied government support.  

In 1956, W. Randolph Burgess, former National City Bank Vice President, left his Treasury Department post to become the US ambassador to NATO. By that time, the luster of NATO was fading. By 1963, Burgess noted that “the shine of postwar NATO was getting a little dull.” Stronger European countries felt less threatened by Soviet aggression and this made them less pliable to US policies. In addition, their European  banks began spreading their wings globally again. The financial end of the cold war was preceding the diplomatic end by decades.

The International Bank Race

US bankers sought to compete with strengthening European banks by opening more offices overseas and by fighting to eliminate New Deal regulatory restrictions so they could grow domestically and use their size as a broader lending springboard.

Fast forward sixty years later to today , and those seeds of political-military-financial partnerships against the threat of the Soviet Union (now Russia) have sprouted to support US banks and dollar, and US monetary and fiscal policy supremacy the world over.

Much has happened in between; mass deregulation of international banking, technological advancements in trading, and the use of the World Bank (and the IMF and various central banks) to subsidize bank led speculation by submitting weak countries to austerity measures or ‘bailouts’, thereby prioritizing payments to bondholder clients of mega-banks over economic stability. The Big Six banks in the US, a subset of the 30 G-SIBs (global systemically important banks) enjoy a magnitude of government, central bank and multinational entity support that would have been unimaginable back then.

Whether it’s a $17 billion bailout package for the Ukraine. or a $270 billion one for Greece, or Obama doing a 180 on Cuba to keep Russia out, the costs of power alignments are greater than ever for the smaller, weaker countries. Their economic coffers have been pried open by the Western super-powers still calling the political, military and financial shots and again using threats of Russian ‘aggression’ to camouflage expansionary intents.

Under Obama, the US is resurrecting the Cold War and invigorating NATO by promoting the threat notion, just as Truman and Eisenhower did.  Financial supremacy and currency dominance remain central to this strategy. But this time, there’s a more dangerous difference – a level of financial opposition that could become military opposition if sufficiently provoked. The counter-movement from a currency and financial perspective is comparatively small. But it’s growing.  The global position of super-powers and super-banks remains at play in this newly sanctioned financial Cold War.  

For more on historical foundations for present decisions, read: All the Presidents’ Bankers: The Hidden Alliances that Drive American Power (out now in paperback). Also, please watch my interview with Max Keiser

References (1)

References allow you to track sources for this article, as well as articles that were written in response to this article.

Reader Comments (13)

Extraordinary as usual! Absolutely insightful!
Many thanks!

But what is this financial opposition of which you speak?
The BRICS bank? The new Chinese Asian bank?
Isn't the Russian banking system a disaster?....

March 24, 2015 | Unregistered CommenterALAN

There you have it. The GANSTER TROIKA. Democracy as most Americans know it is one huge hoax. Russia and China know it and I do not think they are going to back down. It seems to me that the only option that China and Russia have presented with is; Join us as subordinates or let the chips fall where they may.


March 24, 2015 | Unregistered CommenterG.A.O


Yes those are some of the opposing elements, as if the renewed trade and financial agreements between Russia, China and Latin America which parallel those of the US in the mid-1900s as I write about in APB….It should be noted that this is not an overnight shift, nor was that of the dollar's dominance, we are talking decades of sustained shifting to really alter the present course, though these could be marked by periods of more powerful shifts throughout.

March 24, 2015 | Registered CommenterNomi Prins

George - I like the term Gangster-Troika - there is a real mob-loan sharklike quality there.

March 24, 2015 | Registered CommenterNomi Prins

The Scriptures has it right. The prince of this world is Satan! He is out to destroy all freedoms, as George Orwell wrote in his prophetic book, "1984" which is taking place now.
George Orwell , I believe, he was a member of the "Royal Institute of Foreign Affairs" which created the "council on Foreign Relations. He was part of the insider group ,and knew what would happen in the future. As Franklin Roosevelt said, " Nothing happens in Washington by accident, it was planned that way!"

March 25, 2015 | Unregistered CommenterMarcel LeRoi

Recently the US has been making some really stupid decisions that show, better than anything, how they have become so enamoured of their own self importance; they have lost sight of their need to signify the US as the bastion of freedom. They have become much too greedy, bringing to the fore the old saying; Power corrupts, absolute power corrupts absolutely.

The US administration, (NOT the people), has become absolutely corrupt; and as with all such, it is the very small mistakes that will signal their own self destruction; when the markets collapse; as they have to eventually. A very sad end to what was once seen as a great nation.

March 25, 2015 | Unregistered CommenterChris Coles

Fantastic article, Ms. Prins, and also a great (but far too rushed, IMHO) appearance on the Max Keiser Show:

March 25, 2015 | Unregistered Commentersgt_doom

People of all faiths have debated the identity of the 'Beast' and the 'Harlot' in the Revelation to John for many years. In fact, because these two entities are unknown and seemingly unidentifiable, post-modern secular thought treats the allegories in Revelation as indicative of falsehood or fantasy. This would be a tragic mistake of course, because your book & article have highlighted an instance where two seemingly distinct entities (the (public) military and (private) bankers/corporations) are highly intertwined in their causal relationships and outcomes. Note that the Beast and Harlot travel together, with the Harlot "riding" on the Beast. In similar fashion, the bankers have ridden on the backs of USA military victories and superiority and have contaminated our relationship with the former "great powers/empires" of Europe, producing another hybridized power dynamic. The interesting point to note is that the Beast isn't passive forever and turns against the Harlot--i.e., against the very bankers that it sponsored initially. I believe we are now entering this period of history and your chronology seems to buttress this theory.

March 25, 2015 | Unregistered CommenterKurt Carmichael

Hi Nomi,

Thanks for your sleuthing work.

Have you considered that the East v West antagonism is simply theatre?

"The idea was that those who direct the overall conspiracy could use the differences in those two so-called ideologies [marxism/fascism/socialism v. democracy/capitalism] to enable them [the Illuminati] to divide larger and larger portions of the human race into opposing camps so that they could be armed and then brainwashed into fighting and destroying each other."

Myron Fagan

"The drive of the Rockefellers and their allies is to create a one-world government combining supercapitalism and Communism under the same tent, all under their control.... Do I mean conspiracy? Yes I do. I am convinced there is such a plot, international in scope, generations old in planning, and incredibly evil in intent."

Congressman Larry P. McDonald, 1976, killed in the Korean Airlines 747 that was shot down by the Soviets

Watch:The Best Enemies Money Can Buy -- Soviet Russia and Nazi Germany -- Prof. Antony C. Sutton


God bless,

March 26, 2015 | Unregistered CommenterAndy

An intriguing article. Thank you. As the saying goes, 'There is no such thing as a free meal'. I have always held the belief that WW2 was the saving of America; its production levels were well below capacity not having yet recovered from the Depression. The Marshall Plan dovetailed nicely post WW2 with America's expansionary plans and its battle against communism. 'Freedom' indeed from either dogma...... take your pick.

March 27, 2015 | Unregistered CommenterJames Patrick Brennan

I just started to read your page about 4 months ago. I am coming up to speed and appreciate you work and insight to the problems we a a people face .Thank you and keep up the great work.

March 27, 2015 | Unregistered CommenterNomi Prins

Saw you on "Real Money" and ended up here. Quite the journey.

So you lead with "political-military-financial power"--but aren't you a bit light on the military part? Perhaps some good cinema:

Yes, Goldman Sachs has too much influence at the White House but how many times did Google visit? Oh yes, you are right, Goldman lives there.

Let's get the banks to stop being criminal--drug money, currency manipulation, crazy financial instruments, $100B plus in fines. Perhaps they might only use their powers for good and take an oath to something besides the love of money and the stuff. Then the foreign policy issue and the cold-war-two issue will manifest destiny itself away. It is not the relationship per se, rather it is that one of the players is criminal. Look to the Pope and the Vatican bank.

It's sites like those of yours, Greg and Chris, and hearing and reading the likes of you that make me feel that my understanding of what's going on is closer to the truth. And. hopefully, with people like Yanis Varoufakis STATING it. we may have started down the road of realisation of where the economies of the world really are.

Keep up the great work!

April 9, 2015 | Unregistered CommenterMothers day Quotes
Member Account Required
You must have a member account on this website in order to post comments. Log in to your account to enable posting.