Countless historians have shown how the Cold War led to the rise of modernization theory and its overriding influence for U.S. foreign policy in the Global South. But what about the Soviet Union? Is it more accurate to say that Americans viewed the USSR as a competing form of modernity rather than the clearest example of the unmodern?
As is the answer with most questions of this sort, yes and no.
If you haven't read Latham's Modernization as Ideology, Hunt's Ideology and U.S. Foreign Policy, and Gaddis' The Cold War, those are good places to start.
On a basic level, both the United States and the Soviet Union saw themselves as the embodiment of historical modernity. Per Marxist ideology, all capitalist states were in a standard stage of development moving toward an eventual socialist ideal. Seeing capitalism as the source of the world's ills, the Soviets believed they could bypass the capitalist stage and build socialism from the ground up. So while the Soviets saw their system as the most historically advanced but still a work in progress, the West (specifically the U.S.) largely saw its system as a proven model or finished product for the rest of the world to emulate.
In this sense, the Soviets saw themselves as "modern" based on their society's advanced location on a predictable path of historical development, whatever the actual conditions of the present might be. The West, on the other hand, imagined its modernity in terms of the high standard of living and the principles and institutions of government and economic management which resulted in that greater material wellbeing.
In order to contain communism, the United States needed to quickly facilitate economic development in the global south, as you mentioned. The U.S. became particularly active in this state-building project in the 1960s, when American social scientists were more certain than ever that they had the insight and analytical tools necessary to solve pretty much any complex social, logistical or economic problems. So the U.S. did more to frame its global projects as modernization, while the Soviets typically framed theirs as anti-exploitation.
Because most of the practices and principles touted by the U.S. as "modern" were at that time almost the exclusive property of western European societies, someone else should be able to point you toward a long-running body of literature concerning whether, if at all, the "modernization" we speak of is distinct from "westernization."
But getting back to your original question, yes, the Soviet Union very much represented a competing idea of modernity. The Soviets saw themselves as such. Liberal democracy and Soviet-style socialism share common European intellectual roots. If the U.S. and Confucianist China are different species, liberal democracy and Soviet-style socialism are more like disagreeable cousins. And while the U.S. may have looked at the USSR and seen from their perspective the antithesis of all things modern, the U.S. and the Soviet Union were both espousing world views and associated state structures which they believed represented the future of civilization. For any small post-colonial state on the sidelines, it was a matter of choosing which "modernity" was more appealing.
Unless you're India, in which case you kinda do your own thing.
The classic discourse of modernization theory, e.g. the work of Walt Rostow, says that all societies go through the following stages:
- Traditional society
- Preconditions for "take-off"
- "Take-off" (self-sustaining development)
- Drive to Maturity
- High mass consumption
It's purposefully teleological, and it is an historical process that can be accelerated or halted by deliberate action.
How did it understand the USSR? Well, the title of Rostow's canonical 1960 work on this was The Stages of Economic Growth: A Non-Communist Manifesto. So that gives a little bit of a hint. (If you're interested in Rostow's model, the Wikipedia article ain't bad.)
Rostow thought that Russia had hit "take-off" in the early 20th century but only got around to "maturity" in the 1940s. But it could never hit mass consumption under Communism — it is antithetical to that approach to government.
So on that scale, the Soviets weren't too bad — they were way more modern than the "third world." They were an industrial power with significant production capacity, something that couldn't be said of, say, China or India in the early 1960s (which were just entering into "take-off"). But they weren't ever going to get to be ultimately "modern" unless they jettisoned a lot of what Communism meant at the time. (Which is probably what these people would say that China ended up doing with the Dengist reforms.)
They wouldn't be seen as the opposite of modern. The opposite of modern under these models is a bunch of unorganized tribes and things like that. The Soviets clearly weren't that. They were a major industrial nation that, in the view of Western economists, was never going to be very successful because they never allowed innovation to thrive and private ownership to get to the point where you'd have a mass-consumption middle class. They were stalled, not opposites.
This obviously isn't how the Soviets saw things, but that goes without saying. What is interesting to me is that both Marx and Rostow are presenting superficially similar models — both very structuralist, historicist, teleological models of economic development — but the come away with very different interpretations about what the end point is meant to be.