Claims

Factual · Economics and markets

“We weren't deeply connected to the Soviet Union.”

Peter Thiel, investor, interviewee · 7 February 2020 · The World According to Thiel (Hoover Institution)

The US economy was not deeply connected to the Soviet Union's during the Cold War.

Mostly true True in substance, wrong in a detail.

What would count as true or false

Test against Cold War trade and financial data. True: US–Soviet trade and investment made up a negligible share of US GDP and of total US trade throughout the Cold War (e.g. well under 1% of US trade), with no significant supply-chain or financial interdependence. Mostly true: links were minimal overall but there were notable episodes (e.g. 1970s–80s grain sales) that the claim glosses over. Mixed: interdependence was significant in some important sectors or periods but minimal overall. Mostly false: the economic links were substantial for an extended period, but the claim's point about low interdependence compared with today's US–China ties still has some basis. False: the US economy was deeply connected to the Soviet economy.

Evidence

1. Soviet Bloc Economic and Financial Situation Update: (02/10/1982) (1), Executive Secretariat, NSC: Country File, Box 19 Ronald Reagan Presidential Library (US National Archives) · February 1982

   “The dramatic surge in Soviet trade with the West during the 1970s resulted largely from a growing dependence by the USSR on foreign machinery, technology, and farm products. Hard currency imports grew ninefold, from less than 25 percent of total imports to nearly 40 percent.”

2. The Economic Content of Soviet Trade With the West Law and Contemporary Problems (Duke University School of Law) · 1964

   “For the U.S.S.R., as well as for the Bloc as a whole, the nations of the industrial West account for eighteen per cent of all trade transactions.”

3. The Economic Content of Soviet Trade with the West Law and Contemporary Problems (Duke University School of Law), by Leon M. Herman

   “In x962, for instance, the actual figures were: $79 million imported from East Europe into the United States; $2,527 million into Western Europe. From Russia, in particular, we imported $6 million worth of commodities in the same year”

4. The Economic Content of Soviet Trade with the West Law and Contemporary Problems (Duke University School of Law), by Leon M. Herman

   “As far as the non-Communist nations are concerned, therefore, the contribution made by the Soviet Union to their foreign trade in the course of any recent year, measured in aggregate terms, amounts to less than two per cent.”

5. The Economic Content of Soviet Trade with the West Law and Contemporary Problems (Duke University School of Law), by Leon M. Herman

   “For the U.S.S.R., as well as for the Bloc as a whole, the nations of the industrial West account for eighteen per cent of all trade transactions.”

6. Soviet Economic Dependence on the West (CIA study, included in Reagan Library folder 'Soviet Bloc Economic and Financial Situation Update: (02/10/1982) (1)') Ronald Reagan Presidential Library (digitized US government intelligence study, CIA) · January 1982

   “Imports from the USSR in 1980, for example, represented only 2 percent of imports by OECD countries.”

7. [PDF] EAST-WEST COMMERCIAL POLICY: A CONGRESSIONAL DIALOGUE WITH THE REAGAN ADMINISTRATION Joint Economic Committee, U.S. Congress (with Congressional Research Service background) · 16 February 1982

   “Trade with the communist countries amounted to only 4 percent of total U.S. world trade, with exports accounting for approximately 0.3 percent of U.S. GNP.”

8. [PDF] EAST-WEST COMMERCIAL POLICY: A CONGRESSIONAL DIALOGUE WITH THE REAGAN ADMINISTRATION Joint Economic Committee, U.S. Congress (with Congressional Research Service background) · 16 February 1982

   “Total exports to the Communist countries in 1980 reached $7.6 billion which represents only about 3.4% of total U.S. exports in that year.”

9. [PDF] EAST-WEST COMMERCIAL POLICY: A CONGRESSIONAL DIALOGUE WITH THE REAGAN ADMINISTRATION Joint Economic Committee, U.S. Congress (with Congressional Research Service background) · 16 February 1982

   “The Eastern market is important to U.S. agriculture, but not to any other major economic sector in the U.S.A.”

10. U.S., Soviets Extend Grain Deal 2 Years Los Angeles Times · 29 November 1988

    “Taken together, wheat, corn and soybean purchases totaled $871 million in fiscal 1987, the last year for which full trade figures are available, and constituted nearly 60% of U.S. exports of $1.48 billion to the Soviet Union. In 1984, however, U.S. grain sales alone were $2.8 billion, and in the 1970s they were even greater.”

Reasoning

Independent sources show US–Soviet economic links were small overall. The US imported only $6 million of goods from Russia in 1962 (E5). Trade with all communist countries was about 4% of total US world trade, with exports about 0.3% of US GNP (E9), and 1980 exports to them were about 3.4% of total US exports (E10). However, a Congressional Research Service background paper says the Eastern market was important to US agriculture but not to any other major US economic sector (E11), and US grain sales to the USSR were $2.8 billion in 1984 and larger in the 1970s (E12). These are the kind of notable grain episodes the criteria say a "mostly true" verdict allows for.

Cite this claim

Peter Thiel, “The US economy was not deeply connected to the Soviet Union's during the Cold War.” (said 7 February 2020). Verdict: mostly true. Reliability API, claim c_59e7d1384c64, method 0.1.0+3e03e2df. https://epistacklabs.com/claims/c_59e7d1384c64