Technology students served as go-betweens for secret US aid

After the war, Finns bought oranges, coffee, and nylon stockings which came from US warehouses

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By Unto Hämäläinen
     
      Paavo Koponen, a young technology student, felt that he was in a difficult situation. It was 1949, and he was taking part in activities of his student union, and had become involved in charity trade, in which the students served as middlemen in selling American products more or less under the table.
     The goods were eagerly received by Finnish consumers, who were living under severe shortages and rationing. Especially desired were oranges, coffee, and nylon stockings.
     Koponen’s conscience bothered him so much that he went straight to President Juho Kusti Paasikivi and asked him if it was right to take part in trade that was on the fringes of legality.
     Paasikivi reassured the nervous technology student. He asked: “Young friend, is it not appropriate that the deceit is managed with our knowledge, and by people who are trustworthy, than for it to take place in secret?”
     The President told Koponen that he was aware of the matter, and urged him to carry on “at full speed”.
     
The discussion between the student and the President is mentioned in a book by Panu Nykänen marking the 60-year history of the activities of the Helsinki University of Technology and its student union.
     The book includes a thorough account of the extensive business that the technology students ran after the war. The students managed to get large amounts of goods either directly from the United States, or from surplus warehouses that the Americans had in Europe, which they passed on to resellers.
     The business brought the students massive profits. The officials gave them breaks in import tariffs and taxes, and turned a blind eye to the peculiarities of the trade.
     
According to the book, the money was used for good causes. Housing was built for technology students, and their hobbies were supported in many ways.
     In his book, Nykänen manages to prove convincingly that in addition President Paasikivi, government ministers and key civil servants, as well as the directors of the Bank of Finland, were in on the “scam”.
     The trade later led to a trial in court, but the punishments were minimal.
     
What makes the matter politically interesting is that the activity had the blessing of the state leadership. Paasikivi took quite a risk, because aid from the United States might have made a suspicious Soviet Union nervous.
     In 1947 Finland was compelled to refuse aid under the Marshall Plan, which the USA offered to Western Europe, which was recovering from the war. Finland was the only Western country in Europe to turn down the aid. Even neutral Sweden, which managed to avoid getting involved in the war at all, had the nerve to accept American aid.
     Nykänen’s book shows that Finland actually did receive Marshall Plan aid. The goods for the charity trade came from the same places from where other countries received official aid. The difference between the aid that the was received by the other countries of Western Europe, and that of Finland was paper-thin, or then there was no difference at all.
     
The same was revealed in a book that came out last autumn by Mikko Majander called Demokratiaa dollareilla (“Democracy with Dollars”). Majander details how the Finnish Social Democratic Party received aid after the war to help in the fight against communism.
     Majander’s book was based notes by on the SDP’s former treasurer. They were found by coincidence in the archives of Sweden’s Social Democratic Party.
     According to Majander’s book, the US State Department decided that American organisations should set up ties with Finnish organisations, and provide economic aid to Finland through those organisations.
     Support was forthcoming only to right-thinking, pro-West groups in Finland.
     To this end, both the technology students, and the Social Democrats qualified.
     
The books of Panu Nykänen and Mikko Majander provide new details for the image of postwar Finland. Surprisingly few books have been written about Finnish-US relations, in light of the importance of those relations.
     One possible reason for this might be that there is still a reluctance to admit that Finland played a two-faced game between East and West.
     In the whole postwar period, Finland officially emphasised good relations with the Soviet Union. They went ahead of everything else, and the views of the Eastern neighbour needed to be heard also with respect to relations with the West.
     
Finland cautiously went along with integration with Western Europe. The country’s room to manoeuvre did not increase until the late 1980s, when the Soviet Union had already weakened.
     When relations with the great powers, the Soviet Union and the United States had to be dealt with, the Soviet Union always took priority. But even in difficult situations, Finland quietly worked with the United States. This cooperation was not flaunted in public at the time. The caution can be easily understood, as the Soviet Union might have taken offence.
     It is nevertheless surprising that silence on this cooperation has continued even after the end of the Cold War. Those of you who know more about it, please tell more!
     
Helsingin Sanomat / First published in print 30.11.2008


Previously in HS International Edition:
  Hidden help from across the Atlantic (10.12.2006)
  Book: Dollars and krona used to shore up SDP and keep postwar Finland in the West (27.9.2007)

UNTO HÄMÄLÄINEN / Helsingin Sanomat
unto.hamalainen@hs.fi