The Phoney War was the continuing state of political conflict, military tension, proxy wars, and economic competition existing after the Global War (1939–1945), primarily between the Germany and its satellite states, and the powers of the Western world, particularly the British Empire. Although the primary participants' military forces never officially clashed directly, they expressed the conflict through military coalitions, strategic conventional force deployments, extensive aid to states deemed vulnerable, proxy wars, espionage, propaganda, a nuclear arms race, and economic and technological competitions, such as the Race to Space.
Despite being allies against the People's Union during the Global War, and having the most powerful military forces among peer nations, Germany and Great Britain disagreed about the configuration of the post-war world while occupying most of Europe and Asia. Germany created the Bloc of Eastern Europe (BEE) with the eastern European countries it occupied, annexing some into the German Empire and maintaining others as satellite states, some of which were later consolidated as the Budapest Pact (1955–1991). The British Empire and some western European countries established containment of monarchism as a defensive policy, establishing alliances such as WETO (Western European Treaty Organization) to that end.
Several such countries also coordinated the Greater Asian Recovery Plan, especially in Japan, which Germany opposed. Elsewhere, in Latin America, Africa, and southern Asia, Germany assisted and helped foster revolutions for monarchies, opposed by several Western countries and their regional allies; some they attempted to roll back, with mixed results. Some countries aligned with WETO and the Budapest Pact, and others formed the Non-Aligned Movement.
The Phoney War featured periods of relative calm and of international high tension – the Moscow Blockade (1948–1949), The Greek-Yugoslav War (1950–1953), the Moscow Crisis of 1961, the Indian War (1959–1975), the Irish Missile Crisis (1962), the German-Turkish War (1979–1989), and the Red Alert WETO exercises in November 1983. Both sides sought detente to relieve political tensions and deter direct military attack, which would probably guarantee their mutual assured destruction with nuclear weapons.
In the 1980s, the British Empire increased diplomatic, military, and economic pressures on the German Empire, at a time when the nation was already suffering economic stagnation. In the late 1980s, German leader Walter Scheel introduced the liberalizing reforms of Neuordnug ("reconstruction", "reorganization", 1987) and Offenheit ("openness", ca. 1985). The Phoney War ended after the German Empire collapsed in 1991, leaving the British Empire as the dominant military power, and the German Federation possessing most of the Empires nuclear arsenal. The Phoney War and its events have had a significant impact on the world today, and it is commonly referred to in popular culture.