“You Can’t Put a Price Tag on Freedom.” Challenging East-West trade policy in the 1960s
By Georg Wolff
“Even so is the Libyan fable famed abroad: the eagle, pierced by the bow-sped shaft, looked at the feathered device, and said, ‘Thus, not by others, but by means of our own plumage, are we slain.’ ” – Fragment of Aeschylus Myrmidones, translation by Herbert Weir Smyth
Imagine being Raymond Firestone, chief executive of the Firestone Tire & Rubber Company. It is the year 1965, the date is May 31st. Today is the day of the Indianapolis 500 race, and you have been named honorary referee. But this is just the cherry on top of all the advertising opportunities presented to you. Under the eyes of thousands of spectators (an estimated 250,000 on the stands alone), the daredevil racers will showcase your newest top-of-the line tires, and numerous perimeter boards will remind the audience that the athletes are ‘riding on Firestone.’ You get ready to carry out your ceremonial duties when a lone plane appears on the sky. Perplexed (aerial flybys at races only became a thing in the 80s), you look up and notice it is towing a banner. As it gets closer, you can make out the message it transports: The Viet Cong ride on Firestone.
The audience gets notably upset by this news. Out of nowhere, you feel, dozens of young men (and, although in much smaller numbers, women) show up in the stands, wearing buttons reading “Young Americans for Freedom” and handing out leaflets that talk about Firestone building a synthetic rubber plant in ‘Red’ Romania and thereby fueling the communist war machine. The day ends in disaster. The same evening, telegrams of some of your top customers reach you, announcing that they’ll be taking their business elsewhere. But they’re nothing against the flood of letters by enraged citizens pouring into your offices the following days and weeks.
The episode above is purely fictional, but at one point, it wasn’t far from becoming reality. To prevent such a scenario, Firestone announced on April 20, 1965, that it had cancelled its plans to build a plant in Romania. What had happened?
In 1956, the Eastern bloc had been shaken by the so-called ‘Secret Speech’ of Nikita Khrushchev, First Secretary of the Communist Party of the Soviet Union, in which he denounced Stalin’s cult of personality and terror regime. The speech was a milestone of the ‘Khrushchev Thaw’ and had severe implications for international relations within the communist camp. It advanced the Sino-Soviet split, because Mao attacked Khrushchev as revisionist, but it also brought the Stalinist regimes of Eastern Europe under pressure, which had to fear that their own populace would demand liberal reforms in the Soviet image.
Romania, where Gheorghe Gheorghiu-Dej had ruled with an iron fist since 1947, is a case in point. In the wake of the Khrushchev Thaw, the Romanian dictator looked to increase his country’s independence from the Soviet Union and enhance the reputation of his own regime by shoring up nationalism. Thus, some old national heroes, hitherto degraded as ‘bourgeois’, were rehabilitated and mandatory Russian classes dropped. A rapid expansion of Romanian heavy industry was meant to inspire national pride. However, Romania was dependent on natural resource imports, among them rubber. One of its top priorities therefore was to acquire synthetic rubber technology that could make use of the vast oil reserves of the country.
The US state department, on the other hand, had its own interests for increasing trade with Romania. In the face of waning prestige of the Soviet Union during the Khrushchev years and especially after the Cuban Missile Crisis, government officials hoped to drive a wedge between the SU and its satellites by intensifying trade relations with the West.
In a May 1964 speech honoring the legacy of George Marshall (of the Marshall Plan), President Lyndon B. Johnson argued that “[t]here is no longer a single Iron Curtain. There are many. Each differs in strength and thickness[.]” The U.S. would continue to “build bridges […] of increased trade” to further independence aspirations, spread Western values, encourage “legitimate national pride” and “demonstrate that identity of interest and the prospects of progress for Eastern Europe lie in a wider relationship with the West.” Not even a week later, negotiations between Romanian and US officials resulted in a list of 15 industrial plants that Romania could potentially buy from US companies, including two different synthetic rubber plants. Multiple companies submitted bids for the projects, hoping to develop new markets previously dominated by their (Western) European competitors, but by the end of the year, Firestone remained the only viable alternative.
It was then that Firestone competitor Goodyear published an article entitled “An Order Goodyear didn’t take” in its newsletter The Wingfoot Clan, claiming they had rejected a state department offer to build a rubber plant in Romania, citing political concerns and attacking Firestone for not doing the same. The article closed with an emotional appeal: “Even to a dedicated profit-making organization, some things are more important than dollars. Take the best interests of the United States and the Free World, for example. You can’t put a price tag on freedom.” The story was picked up by conservative newspapers and periodicals, among them Human Events, via which it reached David Walter, then treasurer of the Philadelphia County chapter of the conservative youth organization Young Americans for Freedom (YAF). While praising Goodyear’s steadfastness, the chapter picketed the Firestone offices in downtown Philadelphia and spread the news to its parent organization, which turned the protests into a nation-wide campaign. What the activists didn’t know was that Goodyear had actually submitted a bid for the plant that had been rejected, but now tried to turn the situation into a marketing advantage.
For YAF members, more was at stake than a simple rubber plant in Romania. In a leaflet distributed during the pickets, they argued that Romania was expanding its trade with the People’s Republic of China (to bolster its position in the Sino-Soviet split). ‘Red’ China, in turn, was the main supplier of logistical equipment to the Democratic Republic of Vietnam. It was easy to imagine that Firestone-sponsored synthetic rubber could be used to produce tires for heavy-duty trucks Romania was exporting to China, which could then be sent to Vietnam. At a point in time when the Vietnam War was already present in the minds of the American public and rapidly escalating, such a scenario raised a huge red flag. When Firestone representatives appeared unresponsive to YAF’s actions, the organization expanded the campaign and threatened a scenario as described above. Facing mounting public pressure and receiving no public reassurance from a seemingly indifferent state department, Firestone finally caved in on April 20, 1965, and cancelled its plans to build the plant.
State department officials and their congressional supporters were less than enthused about YAF’s supposed “coup.” Arkansas senator William Fulbright in particular denounced the conservatives’ (a “minor vigilante group”) campaign as “nuisance activities” and decried the allegedly illegitimate interference of private groups into US government policy. Indeed, after the failure of the Firestone deal, the Romanians became increasingly skeptical whether the US was a reliable partner for its economic strategy. By 1966, only one of the originally planned 15 plants had been purchased.
Historians have interpreted the backlash to the ‘Firestone Affair’ as a trigger for subsequent YAF backpedaling on the matter of East-West trade. The sorcerer’s apprentice had lost control of his summon, the narrative goes, and now tried to institute safeguards against future abuses.
The opposite is true. The backing down of Firestone was the organization’s biggest success to this date. When its policy committee formulated official guidelines for “future YAF action on proposed trade deals with communist nations”, it was not performing some sort of apologetic maneuver but rather trying to capitalize on the success of the Firestone campaign. Indeed, the same statement affirmed that “we must oppose the stand our government has taken and its official designation of what is ‘strategic.’” To be fair, they also announced that they would only agitate against such deals “which plainly give aid and comfort to the Communist enemy by building up their military power”, but the passage above shows that this was decisively not a very narrow definition. YAF had earlier argued that, in fact, any trade was strategic in principle, since it freed up economic capabilities that could then be used for military purposes.
The statement of the policy committee was corroborated by the membership at the national conventions of 1965 and 1967, and protest actions against plans of companies such as IBM, General Motors, or Mack Trucks remained a cornerstone of YAF activism. The corresponding resolution of 1965 gives a concise insight into why the organization could not back away from its opposition to East-West trade:
“The struggle between freedom and Communism is total, not by our choice, but by the nature of our adversary, and encompasses all means of competition, including military, political, and economic. […] The administration has adopted a policy described as “building bridges to the East,” which are in reality one-way avenues carrying benefit to the Communist nations with no benefit to the Free World.” (Emphasis added).
YAF considered economic struggles a vital part of the Cold War, which thus also was a trade war subject to hawkish anti-communist thinking. This meant that firstly, they had a monolithic view of the Eastern bloc. Neglecting internal tensions within the communist camp, such as Romania’s quest for autonomy or the Sino-Soviet split, each individual gain of any communist nation would be a gain for the “world communist enterprise.” Secondly, by strengthening the economy, the US would not, as government officials hoped, spread Western values among the populace of communist nations, but rather help entrench dictatorial regimes. The error, according to YAF, was that the state department dealt “with Communist governments as if they were ‘of the people’ … never extracting confessions from them for their peoples” in return for trade deals. Thirdly, and most importantly, in an anti-communist Weltanschauung, competition between the East and West was fundamentally a zero-sum game. If trading with the West was beneficial for a communist country, it was therefore detrimental to American interests.
Like many anti-communist imperatives, the rejection of trade with communist nations conflicted with conservative free market rhetoric. Normally, a consensual trade agreement would be seen as beneficial to all partners. Indeed, in the Sharon Statement, the programmatic declaration of YAF’s principles, free markets were seen as “the single economic system compatible with the requirements of personal freedom and constitutional government.” Any governmental interference would “ten[d] to reduce the moral and physical strength of the nation.” While in the mid-Sixties most conservatives agreed that trade restrictions were a necessary evil in the context of the Cold War, towards the end of the decade, libertarian members grew increasingly wary of such measures that threatened to permanently expand governmental authority.
Ironically, Pennsylvania YAF, where David Walter had ascended to state chairman, was again at the forefront of a movement towards a positive view of East-West trade. In an article in Commentary on Liberty, a magazine edited by Walter, one author argued that “[t]o speak of a ‘surplus value’ [for the communists] determined by some mystical process completely outside of the market context is […] totally rediculous [sic].” Communist regimes would, in the long run, not be strengthened by trade. On the contrary, “creeping capitalism” would hollow out their systems from the inside. However, libertarians did not condemn the use of ‘free market’ techniques such as boycotts of firms trading with Communist nations, but only demanded that government restrictions be lifted.
The trade matter was one of the issues that led to the split of a radical libertarian faction (including David Walter and some of his Pennsylvania YAF followers) from the national organization at the national convention of 1969. Some of those disaffected members later founded the Libertarian Party, of which David Walter became chairman in 1988.
Today, the Libertarian Party takes a stand against another trade war that is raging between the United States and (among others) a communist regime, namely the People’s Republic of China. Measures like the tariffs on steel and aluminum imports are based on laws passed in the 1960s. By understanding the context and strategic frameworks of their contemporaries, we can evaluate whether they are still appropriate in a rapidly globalizing world economy.
About the author
Georg Wolff is a PhD candidate at the HCA’s research training group “Authority and Trust” (GKAT). He is researching the history of Young Americans for Freedom, focusing on their contributions towards movement building and modern American conservative authority discourse. You can send him a postcard to Hauptstraße 120, 69117 Heidelberg, Germany.
“An Order Goodyear Didn’t Take.” Wingfoot Clan, December 3, 1965. Cited according to Floyd, Ryan. “For Want of Rubber: Romania’s Affair with Firestone in 1965.” East European Quarterly 38, no. 4 (2004): 485-518.
“Young Americans for Freedom and East-West Trade: A Compilation of YAF Policies and Positions on Trade with Communists” (Undated, late 60s/early 70s). Patrick Dowd Papers, Box 2, Folder Subject File – YAF, National Board – Memoranda, circulars, + printed matter. Hoover Institution Archives, Stanford University, Stanford.
Fulbright, William. “Public and Private Responsibility in the Conduct of Foreign Relations.” Congressional Record,July 26, 1965. J. William Fulbright Papers, Series 71, Box 30, Folder 21. Special Collections, University of Arkansas Libraries, Fayetteville. Cited according to Floyd, Ryan. “For Want of Rubber: Romania’s Affair with Firestone in 1965, Part II.” East European Quarterly 39, no. 1 (2005): 63–82.
Johnson, Lyndon. “Remarks in Lexington at the Dedication of the George C. Marshall Research Library, May 23, 1964.” In Public Papers of the Presidents of the United States. Lyndon B. Johnson 1963–1964, Vol. 1, 708–710. Washington, D.C.: Government Printing Office, 1965.
Andrew, John. “Pro-War and Anti-Draft: Young Americans for Freedom and the War in Vietnam.” In The Vietnam War on Campus. Other Voices, More Distant Drums, edited by Marc Gilbert, 1–19. Westport: Praeger Publishers, 2001.
Schoenwald, Jonathan. “No War, No Welfare, and No Damn Taxation: The Student Libertarian Movement, 1968-1972.” In The Vietnam War on Campus. Other Voices, More Distant Drums, edited by Marc Gilbert, 20–53. Westport: Praeger Publishers, 2001.
Are we financing our own destruction? YAF-Advertisement, 1968. Herbert A. Philbrick Papers, Box 218, Folder 6. Library of Congress Manuscript Division, Washington, D.C.
Citizen Ballot – Stop Red Trade, 1968. Herbert A. Philbrick Papers, Box 218, Folder 6. Library of Congress Manuscript Division, Washington, D.C.
Cover of The New Guard, February 1965. In possession of author.
Jim Clark’s 1965 Indianpolis 500-winning Lotus 38, being driven up the hill during the 2010 Goodwood Festival of Speed by former three-time World Champion Jackie Stewart. By Ian McWilliams, licensed under CC BY 2.0.