the marshall plan essay

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Marshall Plan

By: History.com Editors

Updated: November 1, 2022 | Original: December 16, 2009

The Marshall Plan, also known as the European Recovery Program, was a U.S. program providing aid to Western Europe following the devastation of World War II. It was enacted in 1948 and provided more than $15 billion to help finance rebuilding efforts on the continent. The brainchild of U.S. Secretary of State George C. Marshall, for whom it was named, it was crafted as a four-year plan to reconstruct cities, industries and infrastructure heavily damaged during the war and to remove trade barriers between European neighbors—as well as foster commerce between those countries and the United States.

Europe After World War II

Post-war Europe was in dire straits: Millions of its citizens had been killed or seriously wounded in World War II , and in related atrocities such as the Holocaust .

Many cities—including the industrial and cultural centers of London , Dresden , Berlin, Cologne, Liverpool, Birmingham and Hamburg—had been partly or wholly destroyed. Reports provided to Marshall suggested that some regions of the continent were on the brink of famine because agricultural and other food production had been disrupted by the fighting.

In addition, the region’s transportation infrastructure—railways, electric utilities, port facilities, roads, bridges and airports—had suffered extensive damage during airstrikes and artillery attacks, and the shipping fleets of many countries had been sunk. In fact, it could be argued that the only world power not structurally damaged by the conflict had been the United States.

The reconstruction coordinated under the Marshall Plan was formulated following a meeting of the participating European states in the latter half of 1947. Notably, invitations were extended to the Soviet Union and its satellite states.

However, they refused to join the effort, allegedly fearing U.S. involvement in their respective national affairs.

Truman Approves the Marshall Plan

President Harry Truman signed the Marshall Plan on April 3, 1948, and aid was distributed to 16 European nations, including Britain, France, Belgium, the Netherlands, West Germany and Norway.

To highlight the significance of America’s largesse, the billions committed in aid effectively amounted to a generous 5 percent of U.S. gross domestic product at the time.

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What Was the Marshall Plan?

The Marshall Plan provided aid to the recipients essentially on a per capita basis, with larger amounts given to major industrial powers, such as West Germany, France and Great Britain. This was based on the belief of Marshall and his advisors that recovery in these larger nations was essential to overall European recovery.

Still, not all participating nations benefitted equally. Nations such as Italy, who had fought with the Axis powers alongside Nazi Germany, and those who remained neutral (e.g., Switzerland) received less assistance per capita than those countries who fought with the United States and the other Allied powers.

The notable exception was West Germany: Though all of Germany was damaged significantly toward the end of World War II, a viable and revitalized West Germany was seen as essential to economic stability in the region, and as a not-so-subtle rebuke of the communist government and economic system on the other side of the “Iron Curtain” in East Germany.

In all, Great Britain received roughly one-quarter of the total aid provided under the Marshall Plan, while France was given less than one fifth of the funds.

In addition to economic redevelopment, one of the stated goals of the Marshall Plan was to halt the spread of communism on the European continent.

Implementation of the Marshall Plan has been cited as the beginning of the Cold War between the United States, its European allies and the Soviet Union, which had effectively taken control of much of central and eastern Europe and established its satellite republics as communist nations.

The Marshall Plan is also considered a key catalyst for the formation of the North Atlantic Treaty Organization (NATO) , a military alliance between North American and European countries established in 1949.

Impact of the Marshall Plan

Interestingly, in the decades since its implementation, the true economic benefit of the Marshall Plan has been the subject of much debate. Indeed, reports at the time suggest that, by the time the plan took effect, Western Europe was already well on the road to recovery.

And, despite the significant investment on the part of the United States, the funds provided under the Marshall Plan accounted for less than 3 percent of the combined national incomes of the countries that received them. This led to relatively modest growth of GDP in these countries during the four-year period the plan was in effect.

That said, by the time of the plan’s final year, 1952, economic growth in the countries that had received funds had surpassed pre-war levels, a strong indicator of the program’s positive impact, at least economically.

Political Legacy of the Marshall Plan

Politically, however, the legacy of the Marshall Plan arguably tells a different story. Given the refusal to participate on the part of the so-called Eastern Bloc of Soviet states, the initiative certainly reinforced divisions that were already beginning to take root on the continent.

It’s worth noting, too, that the Central Intelligence Agency ( CIA ), the secret service agency of the United States, received 5 percent of the funds allocated under the Marshall Plan. The CIA used these funds to establish “front” businesses in several European countries that were designed to further U.S. interests in the region.

The agency also allegedly financed an anti-communist insurgency in Ukraine, which at the time was a Soviet satellite state.

By and large, though, the Marshall Plan was generally lauded for the desperately needed boost it gave America’s European allies. As the designer of the plan, George C. Marshall himself said, “Our policy is not directed against any country, but against hunger, poverty, desperation and chaos.”

Still, efforts to extend the Marshall Plan beyond its initial four-year period stalled with the beginning of the Korean War in 1950. The countries that received funds under the plan didn’t have to repay the United States, as the monies were awarded in the form of grants. However, the countries did return roughly 5 percent of the money to cover the administrative costs of the plan’s implementation.

Department of State. Office of the Historian. Marshall Plan, 1948. History.state.gov . The Marshall Plan. The George C. Marshall Foundation . Truman and the Marshall Plan. Harry S. Truman Library and Museum .

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Milestone Documents

Marshall Plan (1948)

Citation: Act of April 3, 1948, European Recovery Act [Marshall Plan]; Enrolled Acts and Resolutions of Congress, 1789-1996; General Records of the United States Government; Record Group 11; National Archives.

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View Transcript

On April 3, 1948, President Truman signed the Economic Recovery Act of 1948. It became known as the Marshall Plan, named for Secretary of State George Marshall, who in 1947 proposed that the United States provide economic assistance to restore the economic infrastructure of postwar Europe.

When World War II ended in 1945, Europe lay in ruins: its cities were shattered; its economies were devastated; its people faced famine. In the two years after the war, the Soviet Union’s control of Eastern Europe and the vulnerability of Western European countries to Soviet expansionism heightened the sense of crisis.

To meet this emergency, Secretary of State George Marshall proposed in a speech at Harvard University on June 5, 1947, that European nations create a plan for their economic reconstruction and that the United States provide economic assistance.

On December 19, 1947, President Harry Truman sent Congress a message that followed Marshall’s ideas to provide economic aid to Europe. Congress overwhelmingly passed the Economic Cooperation Act of 1948, and on April 3, 1948, President Truman signed the act that became known as the Marshall Plan.

Over the next four years, Congress appropriated $13.3 billion for European recovery. This aid provided much needed capital and materials that enabled Europeans to rebuild the continent’s economy.

For the United States, the Marshall Plan provided markets for American goods, created reliable trading partners, and supported the development of stable democratic governments in Western Europe. Congress’s approval of the Marshall Plan signaled an extension of the bipartisanship of World War II into the postwar years.

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Secretary of State George Marshall's Speech (the  transcript of the European Recovery Act/Marshall Plan follows)

I need not tell you gentlemen that the world situation is very serious. That must be apparent to all intelligent people. I think one difficulty is that the problem is one of such enormous complexity that the very mass of facts presented to the public by press and radio make it exceedingly difficult for the man in the street to reach a clear appraisement of the situation. Furthermore, the people of this country are distant from the troubled areas of the earth and it is hard for them to comprehend the plight and consequent reaction of the long-suffering peoples, and the effect of those reactions on their governments in connection with our efforts to promote peace in the world.

In considering the requirements for the rehabilitation of Europe the physical loss of life, the visible destruction of cities, factories, mines, and railroads was correctly estimated, but it has become obvious during recent months that this visible destruction was probably less serious than the dislocation of the entire fabric of European economy. For the past 10 years, conditions have been highly abnormal. The feverish maintenance of the war effort engulfed all aspects of national economics. Machinery has fallen into disrepair or is entirely obsolete. Under the arbitrary and destructive Nazi rule, virtually every possible enterprise was geared into the German war machine. Long-standing commercial ties, private institutions, banks, insurance companies, and shipping companies disappeared, through the loss of capital, absorption through nationalization, or by simple destruction. In many countries, confidence in the local currency has been severely shaken. The breakdown of the business structure of Europe during the war was complete. Recovery has been seriously retarded by the fact that 2 years after the close of hostilities a peace settlement with Germany and Austria has not been agreed upon. But even given a more prompt solution of these difficult problems, the rehabilitation of the economic structure of Europe quite evidently will require a much longer time and greater effort than had been foreseen.

There is a phase of this matter which is both interesting and serious. The farmer has always produced the foodstuffs to exchange with the city dweller for the other necessities of life. This division of labor is the basis of modern civilization. At the present time, it is threatened with breakdown. The town and city industries are not producing adequate goods to exchange with the food-producing farmer. Raw materials and fuel are in short supply. Machinery is lacking or worn out. The farmer or the peasant cannot find the goods for sale which he desires to purchase. So the sale of his farm produce for money which he cannot use seems to him unprofitable transaction. He, therefore, has withdrawn many fields from crop cultivation and is using them for grazing. He feeds more grain to stock and finds for himself and his family an ample supply of food, however short he may be on clothing and the other ordinary gadgets of civilization. Meanwhile, people in the cities are short of food and fuel. So the governments are forced to use their foreign money and credits to procure these necessities abroad. This process exhausts funds which are urgently needed for reconstruction. Thus a very serious situation is rapidly developing which bodes no good for the world. The modern system of the division of labor upon which the exchange of products is based is in danger of breaking down.

The truth of the matter is that Europe's requirements for the next 3 or 4 years of foreign food and other essential products -- principally from America -- are so much greater than her present ability to pay that she must have substantial additional help, or face economic, social, and political deterioration of a very grave character.

The remedy lies in breaking the vicious circle and restoring the confidence of the European people in the economic future of their own countries and of Europe as a whole. The manufacturer and the farmer throughout wide areas must be able and willing to exchange their products for currencies the continuing value of which is not open to question.

Aside from the demoralizing effect on the world at large and the possibilities of disturbances arising as a result of the desperation of the people concerned, the consequences to the economy of the United States should be apparent to all. It is logical that the United States should do whatever it is able to do to assist in the return of normal economic health in the world, without which there can be no political stability and no assured peace. Our policy is directed not against any country or doctrine but against hunger, poverty, desperation, and chaos. Its purpose should be the revival of working economy in the world so as to permit the emergence of political and social conditions in which free institutions can exist. Such assistance, I am convinced, must not be on a piecemeal basis as various crises develop. Any assistance that this Government may render in the future should provide a cure rather than a mere palliative. Any government that is willing to assist in the task of recovery will find full cooperation, I am sure, on the part of the United States Government. Any government which maneuvers to block the recovery of other countries cannot expect help from us. Furthermore, governments, political parties, or groups which seek to perpetuate human misery in order to profit therefrom politically or otherwise will encounter the opposition of the United States.

It is already evident that, before the United States Government can proceed much further in its efforts to alleviate the situation and help start the European world on its way to recovery, there must be some agreement among the countries of Europe as to the requirements of the situation and the part those countries themselves will take in order to give proper effect to whatever action might be undertaken by this Government. It would be neither fitting nor efficacious for this Government to undertake to draw up unilaterally a program designed to place Europe on its feet economically. This is the business of the Europeans. The initiative, I think, must come from Europe. The role of this country should consist of friendly aid in the drafting of a European program so far as it may be practical for us to do so. The program should be a joint one, agreed to by a number, if not all European nations.

An essential part of any successful action on the part of the United States is an understanding on the part of the people of America of the character of the problem and the remedies to be applied. Political passion and prejudice should have no part. With foresight, and a willingness on the part of our people to face up to the vast responsibilities which history has clearly placed upon our country, the difficulties I have outlined can and will be overcome.

Transcript of the European Recovery Act/Marshall Plan

Eightieth Congress of the United States of America At the Second Session

Begun and held at the City of Washington on Tuesday, the sixth day of January, one thousand nine hundred and forty-eight

An Act  To promote world peace and the general welfare, national interest, and foreign policy of the United States through economic-financial and other measures necessary to the maintenance of the conditions abroad in which free institutions may survive and consistent with the maintenance of the strength and stability of the United States.

Be it enacted by the Senate and the House of Representatives of the United States of America in Congress assembled, That this Act may be cited as the "Foreign Assistance Act of 1948".

Sec. 101. This title may be cited as the "Economic Cooperation Act of 1948".

Findings and Declaration of Policy

Sec. 102. (a) Recognizing the intimate economic and other relationships between the United States and the nations of Europe, and recognizing that disruption following in the wake of war is not contained by national frontiers, the Congress finds that the existing situation in Europe endangers the establishment of a lasting peace, the general welfare and national interest of the United States, and the attainment of the objectives of the United Nations. The restoration or maintenance in European countries of principles of individual liberty, free institutions, and genuine independence rests largely upon the establishment of sound economic conditions, stable international economic relationships, and the achievement by the countries of Europe of a healthy economy independent of extraordinary outside assistance. The accomplishment of these objectives calls for a plan of European recovery, open to all such nations which cooperate in such plan, based upon a strong production effort, the expansion of foreign trade, the creation and maintenance of internal financial stability, and the development of economic cooperation, including all possible steps to establish and maintain equitable rates of exchange and to bring about the progressive elimination of trade barriers. Mindful of the advantages the United States has enjoyed through the existence of a large domestic market with no internal trade barriers and believing that similar advantages can accrue to the countries of Europe, it is declared to be the policy of the people of the United States to encourage these ... 

[pages omitted]

Economic Corporation, may deem necessary to carry out the purposes of this title and to improve commercial relations with China. 

Sec. 406. Notwithstanding the provisions of any other law, the Reconstruction Finance Corporation is authorized and directed, until such time as an appropriation is made pursuant to section 404, to make advances, not to exceed in the aggregate $50,000,000, to carry out the provision of this title in such manner and in such amounts as the President shall determine. From appropriations authorized under section 404, there shall be repaid without interest to the Reconstruction Finance Corporation the advances made by it under the authority contained herein. No interest shall be charged on advances made by the Treasury to the Reconstruction Finance Corporation in implementation of this section. 

Sec. 407. (a) The Secretary of State, after consultation with the Administrator, is hereby authorized to conclude an agreement with China establishing a Joint Commission of Rural Reconstruction in China, to be composed of two citizens of the United States appointed by the President of the United States and three citizens of China appointed by the President of China. Such Commission shall, subject to the direction and control of the Administrator, formulate and carry out a program for reconstruction in rural areas of China, which shall include such research and training activities as may be necessary or appropriate for such reconstruction: Provided, That assistance furnished under this section shall not be construed as an express or implied assumption by the United States of any responsibility for making an further contributions to carry out the purposes of this section.

(b) Insofar as practicable, an amount equal to not more than 10 per centum of the funds made available under subsection (a) of section 404 shall be used to carry out the purposes of subsection (a) of this section. Such amount may be in United States dollars proceeds in Chinese currency from the sale of commodities made available to China with funds authorized under subsection (a) of section 404, or both.

[endorsements]

Time Essay: The Marshall Plan: A Memory, a Beacon

Britain’s Foreign Secretary Ernest Bevin called it “the most unsordidact of history.” To Willy Brandt, speaking later as Chancellor of WestGermany, it was “one of the strokes of providence of this century, acentury that has not so very ‘often been illuminated by the light ofreason.” It was launched upon the world in Harvard Yard just 30 yearsago this week —in what was surely one of the most momentouscommencement day speeches ever made. Sunshine tattered through thedecorous elms as Harvard staged its first normal graduation exercisessince the end of World War II. The morning ceremonies that spotlightedthe new graduates concluded with the awarding of honorary degrees. T.S.Eliot was among the recipients. Another was a white-haired man in aplain gray suit who rose in response to President James Bryant Conant’sswift and eloquent citation: “An American to whom freedom owes anenduring debt of gratitude, a soldier and statesman whose ability andcharacter brook only one comparison in the history of the nation.”

As the assemblage surged to its feet in a warm ovation, Secretary ofState George Catlett Marshall, who had commanded all of America’smilitary forces during the war, bowed, accepted his doctor of lawsdegree and sat down again. In his pocket, ticking off the day like ahidden bomb, was a speech whose content would shape a new world era anddwarf by its magnitude all the fame that Marshall had so far won. Thatafternoon, when his turn came to make a “few remarks” during thetraditional alumni ceremonies in front of Memorial Church, Marshallquietly took out his speech and read it to his audience. Thus was bornthe Marshall Plan, an epochal —and magnanimous—undertaking unmatchedin all of history. Through it, in the space of four years, the U.S.would spend an unheard-of $13.6 billion to underwrite the economic—and in a sense, the social and political—recovery of war-tornWestern Europe, defeated enemies included.

When Marshall rose to read his speech, the war had long since been won,but not the peace. By early 1947 Soviet adventurism had inspired theTruman Doctrine, with its pledge of military help to any free peoplethreatened by Communist aggression. By April, after a long andfruitless foreign ministers’ conference in Moscow, the U.S. Governmentabandoned all expectations of obtaining cooperation from theRussians—even in balming the wounds of war let alone in fashioning anew world order. In Asia, China was on the verge of falling to Mao. Ofmost concern to Americans, however, was Europe, which teetered on thebrink of a general economic collapse that seemed beyond the capacity ofher ever divided nations to forestall.

Marshall’s words that day in June 1947 not only gave desperate Europe areason to hope but also snatched the initiative in the cold war awayfrom Russia. Marshall wrought a revolutionary departure in Americanforeign policy, wrenching the nation out of an isolationist dispositionthat tracked back to George Washington. The European recovery plan thatbore Marshall’s name—Harry Truman insisted it be so titled—set thestage for the primary defense arrangements in use today by the Atlanticcommunity. Without the economic and political base created by theMarshall Plan, NATO could not have come into being. Nor, likely, wouldthe capacity of European nations for cooperation today ever haveblossomed. The ideas that Marshall set forth are, in fact, still makinghistory. At least an echo of his spirit of innovation could be heardlast week in President Carter’s promise at Notre Dame to “create awider framework of international cooperation suited to the newhistorical circumstances.”

As far as Marshall’s audience knew before he spoke, the Secretary ofState would merely add his bit to the usual commencement pieties. Noballyhoo had preceded him; no Washington flacks had scurried aboutalerting the press that a “major” statement would be forthcoming. Infact, say some who were there, neither Marshall’s typically sparelanguage nor his earnest but dry delivery awakened that gathering fullyto a realization that here history was being made.

“I need not tell you, gentlemen, that the world situation is veryserious,” the speech blandly began. “That must be apparent to allintelligent people.” Then Marshall sketched Europe’s devastation andeconomic disruption:

“The town and city industries are not producing adequate goods toexchange with the food-producing farmer . . . People in the cities areshort of food and fuel. .. The division of labor upon which theexchange of products is based is in danger of breaking down.”

Europe, in short, was broke, shattered—and desperate.

In April, Marshall had come back from Moscow convinced that the Russianshad every intention of exploiting Europe’s misery. Then in May, WillClayton, his Under Secretary for Economic Affairs, reported a rapidly worsening situation. Immediately, Marshall had given George F. Kennan and his policy planning staff two weeks to draft a plan to save Europe. Under Secretary Dean Acheson, aswell as Clayton, contributed heavily to the proposals that were boileddown into the 950-word speech. Now Marshall came to the meat of it:

“The truth of the matter is that Europe’s requirements for the nextthree or four years … are so much greater than her present ability topay that she must have substantial additional help or face economic,social and political deterioration of a very grave character … Asidefrom the demoralizing effect on the world at large and thepossibilities of disturbances arising as a result of the desperation ofthe people concerned, the consequences to the economy of the UnitedStates should be apparent to all. It is logical that the United Statesshould do whatever it is able to do to assist in the return of normaleconomic health in the world, without which there can be no politicalstability and no assured peace.”

And then to the heart of it:

“Our.policy is directed not against any country or doctrine but againsthunger, poverty, desperation, and chaos. Its purpose should be therevival of a working economy in the world so as to permit the emergenceof political and social conditions in which free institutions canexist. Such assistance, I am convinced, must not be on a piecemealbasis … Any assistance that this government may render in the futureshould provide a cure rather than a mere palliative.”

One final crucial point grew out of a wish to force European nations tocease their eternal bickering and begin working together toward alonger-range goal of integration:

“The initiative, I think, must come from Europe. “

Afterward, Marshall wondered whether his message had really got across.Had Under Secretary Acheson been right in advising against using thecommencement as a forum on the ground that speeches there were “aritual to be endured without hearing”? The audience had received himwarmly, at start and finish, but had broken in with applause only once—and not at the most significant place. Marshall, as he had confidedto associates, had hoped that the speech would trigger an “explosive”effect.

In fact, it did so—not in the U.S., although it soon got behind theidea, but in Europe, where the response was instant. That same night,Britain’s Foreign Secretary Bevin began arranging the conferences inwhich Europe’s nations would assess their needs as a region and go tothe U.S. with a program in hand. As Marshall intended, all ofEurope—Russia included—was invited to take part. But Russia, afterthe first conference, refused—and declared war on the plan as anotherexample of U.S. efforts to enslave Europe. Finally 16 nations joined indeveloping a program.

Meanwhile, in the U.S., the Democratic Administration and G.O.P.-runCongress began hammering out enabling legislation in a bi partisanmood fostered mainly by Re publican Senator Arthur Vandenburg.Congress doubtless saw the plan in terms of cold war designs, and itspassage was helped substantially by Stalin’s hostility to it. PresidentHarry Truman himself considered the Truman Doctrine and the MarshallPlan “two halves of the same walnut.” He signed the law onApril 3, 1948. Two weeks after that the freighter John H. Quick leftGalveston, Texas, with 9,000 long tons of wheat for France — the firstitem of a vast outpouring of aid that would eventually include machinetools, farm equipment and raw materials of almost every sort.

The Marshall Plan worked faster than anyone had thought possible. By1951, Western Europe’s industrial production had soared to 40% aboveprewar levels, and its farm output was bigger than ever. WesternEurope’s current status as a vigorous economic competitor of the U.S.testifies to the plan’s effectiveness.

Today the Marshall Plan is only a bright memory. But the very act ofrecalling its historic impact raises the question: Would the U.S. everagain give itself to an undertaking of such boldness and magnitude?Surely some of the world’s conspicuous difficulties — the food andenergy shortages, to name but two glaring ones — seem deserving ofcomparable heroic efforts. Such problems so far, however, haveinspired occasional grand rhetoric without matching action. So perhapsa better question is: Could the U.S. today even muster the combinationof generosity, self-sacrifice and determined will that it dedicated tothe rescue of Western Europe? Does the national character remaincapable of that spirit?

Beyond doubt the American temper is strikingly different today fromwhat it was then. After World War II, the nation enjoyed an almostcocky belief that it could do anything — and everything. Had not theU.S. just saved civilization? Did not the U.S. own the Bomb? Most Americans were eager to proclaim their nation the greatest. And they turned out to be perfectly willing to prove it — once they had been asked to.Americans of Marshall’s day, of course, also had trust in theirGovernment — and a certitude about their power to prevail that had notbeen crumpled by Viet Nam.

The loss of trust and certainty are major differences in post-WatergateAmerica. The nation also, more than in the past, nurses cynical doubtsabout the Government’s capacity to solve any social problems — thoseat home or abroad. More over, Americans of 1977 often seem confused, inthe words of one scholar, “as to where and in what way Americanpower and intelligence can be most usefully applied.” The wordsare those of a man who happened to direct the Marshall Plan in Europein 1950-51 — Professor Milton Katz, now director of internationallegal studies at Harvard Law School. Katz nonetheless believes that granted the recovery of trust and some clear sense of national purpose,the country could still match the great deeds of the postwar era.

Most thoughtful Americans — particularly those old enough to have seenthe nation at its best — are likely to agree.That adviser to many Presidents, Lawyer Clark Clifford, does.”I don’t think there’s been any radical change in the Americancharacter,” he says. And ever buoyant Hubert Humphrey, mullingthe Marshall Plan days last week, ventured a feeling that seems typicalin Washington: “I think we would do it over again — if the samecircumstances existed.”

There, of course, is the crux of the matter. History never quite repeatsitself. The Marshall Plan arose out of a specific juncture of event,public mood and leadership. And who could possibly guess when and howsuch an impelling convergence might occur again? Nobody. But it wouldnonetheless be hazardous to assume, if it did occur, that the Americanpeople would fail to yield their best once more.

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In 1947, Secretary of State George C. Marshall grew increasingly concerned about the situation in Europe. He assembled a team of experts to develop ideas for helping European nations recover from World War II. The recovery was to be funded by the U.S., and it helped save western Europe.

While attending the Moscow Foreign Ministers Conference in March–April 1947, Secretary of State George C. Marshall grew increasingly alarmed that the Soviet Union seemed to be moving away from previous agreements about Europe’s recovery.  

On the evening he returned to the United States, Marshall made a radio address to brief the nation on the conference, and he made his case for assisting Europe right away. Many Europeans were starving and had no shelter from the bitter winter. Their cities lay in ruins, and they faced the collapse of their societies.  Marshall declared “the patient is sinking while the doctors deliberate.”  

The State Department had no firm plans to help Europe recover, so Marshall gathered a dozen experts from a variety of fields and named them the Policy Planning Staff. He gave the staffers two weeks to develop ideas and deliver them to him. They fulfilled their charge, and Marshall took the opportunity of an invitation to speak at Harvard in June 1947 as a way to introduce some of those ideas.  

Marshall sought to present the proposal for helping Europe carefully; he wanted no reporters attending the speech and created a low-key press release. He hoped that the first discussion of the ideas would come from Europe, not the United States. He worried that if the first reactions came from the American press, the whole enterprise would be unable to gain traction.  

In his speech, Marshall pointed out that Europe was going to need help over the long term and laid out ideas for how the United States might deliver it:  

• It would be a European plan funded by the United States.
• All countries in Europe could participate.
• Help would be for a specified time.
• Once immediate physical needs of people were met, the focus should be on rebuilding infrastructure.  
• All participants had to trade equally with each other.  

During the summer of 1947, sixteen European countries hammered out the details of the plan and delivered it to the U.S. State Department. George Marshall and his staff had a monumental task ahead of them to turn this plan into reality. After a long and costly war, Congress did not want to spend any more money in Europe, and Americans wanted to get back to normal life, not focus on European problems.  

In 1948  Marshall and Undersecretary of State Robert Lovett began talking to Congress about the plan, called the “European Recovery Program.” It was first referred to as the “Truman Plan,” but the President suggested calling it the “Marshall Plan,” as Marshall had earned the reputation during his years as Army Chief of Staff for having unimpeachable integrity and being completely nonpartisan.  

Michigan’s Arthur Vandenberg, Chairman of the Senate Committee on Foreign Relations, supported the plan and worked with Marshall and the State Department staff in the uphill battle moving the legislation forward. After multiple hearings and many behind-the-scenes meetings, the bill authorizing the European Recovery Program passed Congress in March 1948 and was signed by President Truman in April, only 10 months after Marshall’s speech at Harvard.  It was a herculean effort, and it saved Western Europe.  

The Marshall Plan Papers

Explore resources relating to the Marshall Plan in our library catalog.

Marshall Plan History

The history and chronology of the plan. Studies prior to the plan. Committee reports and funding statistics about the plan. The Marshall Plan Volume and the plan's relevance today.

Marshall Plan Speech

See records and texts about the speech. Listen to the speech and read information about the drafting of the speech. Discover the European Response.

Foreign Assistance Act of 1948

Documents about the support for and the opposition of the Marshall Plan. Also included is documentation about how it worked and how it was administered.

The Marshall Plan History Essay

Introduction.

Bibliography

It is imperative to mention that the Marshall Plan is a program that was conducted in 1948 to address some of the issues that countries that have suffered had to deal with at that time, and the United States believed that an intervention is necessary. 1 Moreover, its role and impact are frequently discussed, and the fact that George Michael has received The Nobel Prize for his efforts also should not be overlooked. It is possible to state that the influence of this initiative is not as significant as many scholars suggest, and it cannot be viewed as the only reason European economies were able to recover. The amounts of money provided were relatively small if compared to the total value of goods in those countries at that time and some of the processes that took place were not considered.

It is necessary to understand that publicity has played a critical role in this case, and it has affected the opinions of the population. Moreover, the funds that were received did not even exceed five percent of GNP of those nations. Machado states that “two percent went a long way when used wisely and productively.” 2 In other words, the author of the book did not consider the importance of quantitative to justify the impact of this program.

Moreover, it is paramount to understand that the resources were spread among many countries, and such small funds may not be viewed as a force that has influenced economic growth. Also, it is important to note that the growth that has followed could not be caused by the Marshall Plan alone because the assistance was rather minor. The biggest problem that countries in Europe had to deal with at that time is that their economic policies were underdeveloped and had to be improved because they were not efficient. The issue is that the governments were used to systems that were established and were not ready to make any significant changes at that time.

Furthermore, economies of these countries were able to grow at rapid rates once such approaches as unreasonable control were eliminated. Financial stability and restoration of liberty were of utmost importance and had a positive impact on the economy. It is necessary to mention that the Marshall Plan could not have led to such processes. Also, many businesses have started to be much more confident and were willing to participate in activities that would help to rebuild countries after the war.

The importance of economic integration also should not be overlooked, and the collaboration was vital. Another aspect that is quite interesting is that the countries that have received the most support were not able to recover until assistance was reduced. Moreover, such countries as Italy and France have started to develop at rapid rates even before the introduction of the plan. The problem that many countries in Europe have to deal with at that time is that they were military-oriented, and it was not an easy task to get used to other approaches.

Carrol states that “Europe was steadily recovering by 1947 but that the United States needed to protect its economy from a return to the prolonged depression of the 1930s.” 3 Differently put, this approach could have been used as a way to deliver American products in Europe and establish a particular market dependency. The recovery of Germany is especially fascinating, and many view it as the best example of the effectiveness of the Marshall Plan.

However, the situation is quite similar in this case because the support that was offered was not significant, and was less than five percent of GNP. Another aspect that should not be overlooked is that the economy of the country had to suffer because of such factors as reparations and occupation costs. Furthermore, it must be noted that the policies of the United States have hurt the country. The problem is that approaches that were used by Germany were not efficient and had to be changed. The pressure of Allies was enormous, and it was not an easy task to recover the economy because the country had to deal with such issues as increased taxes and had problems with foreign trade. Moreover, the approach that was used by Ludwig Erhard, a German politician was incredibly efficient and has helped the country to get a better understanding of what needs to be done to recover the economy. He criticized the Plan because he viewed it as incredibly bureaucratic. Also, he was able to ensure that a planning initiative that could have been extremely problematic is avoided. 4

A free market and reasonable monetary policies should be viewed as primary factors that have led to the development of the country. Also, it is necessary to mention that these processes have started before the Marshall Plan, and economic growth that has been shown was simply enormous. Another aspect that should not be disregarded is that the economy of Belgium was stable, and it has resisted some of the issues that other European countries had to deal with at that time. Moreover, the state had offered credits to others. Also, it is believed that Belgium was one of the first countries that have dealt with the crisis and were able to recover successfully.

It is necessary to understand that this approach was in the interest of the United States because it has helped to build valuable relationships with many countries. The threat of the USSR was viewed as a significant issue that should be addressed, and a military alliance had to be established. Also, another problem that needs to be discussed is that the evidence that is available may not be viewed as sufficient. Moreover, Alvarez-Cuadrado and Pintea mention that “the Plan contributes to no more than one-fourth of a percentage point of additional growth per year between 1948 and 1951.” 5 Moreover, the author suggests that some of the claims that are made are not backed up by statistics and data was not analyzed. Also, it is noted that the impact on private investments was also not significant, and they have increased only by one percent.

It is imperative to mention that such information is fascinating, and it is entirely possible that European countries would be capable of demonstrating similar growth even without the Plan. On the other hand, the way that ERP has affected political economies also should not be overlooked, and it would not be an easy task to predict what processes would be introduced without an anti-communist perspective. Also, it is necessary to note that growth strategies that the dissimilarity between growth strategies that were adopted by different countries is quite significant. However, it is entirely possible that the period of war may be viewed as an interruption, and free markets would develop even without the support that was offered.

On the other hand, many other positive aspects also should not be overlooked. For instance, some scholars think that the process would take much longer if the support and assistance were not offered. Also, it is important to understand that the United States did not only provide financial aid, and the provision of food and other vital resources also should not be overlooked. Also, it is necessary to mention that the military capabilities of Europe have also increased significantly, and it has an enormous impact on the economy in most cases. Moreover, it is paramount to understand that tremendous amounts of investments were quite important. However, it can be seen that many regions were able to recover without any support, and this aspect needs to be taken into account.

The problem is that it is entirely possible that a significant percentage of those funds were used to support other activities. For instance, communist parties were forced to leave the governments in such countries as Italy and France, and it is possible to state that there were other motives besides the support of economies. 6 Also, many scholars suggest that the impact of new economic approaches was vital and was much more important than financial aid. However, it can be seen that the situation was not the same in many countries. Sorensen and Rudiger state that “American involvement was limited to encourage those political and economic forces best suited to undertake and implement the Plan’s policies.” 7 Furthermore, the strength of the political spectrum should not be disregarded, and it is a factor that needs to be considered in such cases.

Also, it is important to note that tariffs and quotas were especially problematic and could have been addressed to promote free trade. Also, the import from European countries has been reduced in later years, and it may be viewed as a particular contradiction because it was stated that the primary objective of this program was to increase European prosperity. Another core aspect that should not be overlooked is that some think that the initiative has hurt the economy of the United States because several barriers were present. Moreover, it is necessary to note that the situation in Europe at that time was unique, and the Marshall Plan should not be regarded as the most efficient approach in such cases.

In conclusion, it is imperative to note that it is evident that the impact of the Marshall Plan is frequently exaggerated. The reasoning behind this statement is that such amounts of money were not sufficient to cause such dramatic changes. Also, it is believed that many countries were on the way to recovery before the introduction of the initiative. Moreover, Germany was hurt by most policies, but it has shown enormous progress.

It may not be an easy task to take all the aspects into consideration to determine an actual impact that ERP had on the economies. However, it is evident that it may not be viewed as the only reason European countries were able to recover, and numerous pieces of evidence may be listed to support this perspective. The impact on the political economy also may be hard to evaluate, but it is important to understand that most policies at that time were already well-developed. Moreover, the level of understanding of free markets was critical, and most had experience in this area. Overall, it is necessary to understand that the government was capable of using resources that were provided to ensure that recovery processes that have started after the war are prolonged.

Agnew, John, and Nicholas J. Entrikin. The Marshall Plan Today: Model and Metaphor . Abingdon, UK: Psychology Press, 2004.

Alvarez-Cuadrado, Francisco, and Mihaela A. Pintea. “A Quantitative Exploration of the Golden Age of European Growth.” Working Paper, Florida International University, 2008.

Carroll, Francis M. “Ireland and the Marshall Plan, 1947-57 (Review).” New Hibernia Review 1 (2002): 149–151.

Harman, Chris. A People’s History of the World: From the Stone Age to the New Millennium . New York, NY: Verso Books, 2008.

Machado, Barry F. In Search of a Usable Past: The Marshall Plan and Postwar Reconstruction Today. Lexington, VA: George C. Marshall Foundation, 2007.

Mierzejewski, Alfred C. Ludwig Erhard: A Biography. Columbia, SC: University of North Carolina Press, 2005.

Sorensen, Vibeke, and Mogens Rudiger. Denmark’s Social Democratic Government and the Marshall Plan 1947-1950 . Copenhagen, DK: Museum Tusculanum Press, 2001.

• John Agnew and Nicholas J. Entrikin, The Marshall Plan Today: Model and Metaphor (Abingdon, UK: Psychology Press, 2004), 9.
• Barry F. Machado, In Search of a Usable Past: The Marshall Plan and Postwar Reconstruction Today (Lexington, VA: George C. Marshall Foundation, 2007), 32.
• Francis M. Carroll, “Ireland and the Marshall Plan, 1947-57 (Review),” New Hibernia Review 1 (2002): 150.
• Alfred C. Mierzejewski, Ludwig Erhard: A Biography (Columbia, SC: University of North Carolina Press, 2005), 76.
• Francisco Alvarez-Cuadrado and Mihaela A. Pintea, “A Quantitative Exploration of the Golden Age of European Growth” (Working Paper, Florida International University, 2008), 20.
• Chris Harman, A People’s History of the World: From the Stone Age to the New Millennium (New York, NY: Verso Books, 2005), 76.
• Vibeke Sorensen and Mogens Rudiger. Denmark’s Social Democratic Government and the Marshall Plan 1947-1950 (Copenhagen, DK: Museum Tusculanum Press, 2001), 83.
• Chicago (A-D)
• Chicago (N-B)

IvyPanda. (2020, July 10). The Marshall Plan History. https://ivypanda.com/essays/the-marshall-plan-history/

"The Marshall Plan History." IvyPanda , 10 July 2020, ivypanda.com/essays/the-marshall-plan-history/.

IvyPanda . (2020) 'The Marshall Plan History'. 10 July.

IvyPanda . 2020. "The Marshall Plan History." July 10, 2020. https://ivypanda.com/essays/the-marshall-plan-history/.

1. IvyPanda . "The Marshall Plan History." July 10, 2020. https://ivypanda.com/essays/the-marshall-plan-history/.

IvyPanda . "The Marshall Plan History." July 10, 2020. https://ivypanda.com/essays/the-marshall-plan-history/.

• Historical Political Event: The Marshall Plan
• Alfred Marshall and His Contribution to Economics
• Alfred Marshall's Economic Theories
• "Principles of Economics" by Alfred Marshall
• Lessons Learned From the History of the Marshall Plan About the Importance of the USA in the Process of European Integration
• The Spirit of the Marshall Plan
• Thurgood Marshall: Supreme Court of the United States
• The Marshall Plan' Effects on Post WW2 Design
• Kerry James Marshall's Painting "Better Homes Better Gardens"
• The Nuclear Weapons Tests on the Marshall Islands
• The Persian Constitutional Revolution Factors
• The Emergence of the Bipolar World
• Marriage and Politics in 3500 BC-1600 AD
• Why European Economies Rose over the Eastern Ones?
• The Renewal of Imperial Conflict

• The Columbian Exchange
• De Las Casas and the Conquistadors
• Early Visual Representations of the New World
• Failed European Colonies in the New World
• Successful European Colonies in the New World
• A Model of Christian Charity
• Benjamin Franklin’s Satire of Witch Hunting
• The American Revolution as Civil War
• Patrick Henry and “Give Me Liberty!”
• Lexington & Concord: Tipping Point of the Revolution
• Abigail Adams and “Remember the Ladies”
• Thomas Paine’s “Common Sense,” 1776
• Citizen Leadership in the Young Republic
• After Shays’ Rebellion
• James Madison Debates a Bill of Rights
• America, the Creeks, and Other Southeastern Tribes
• America and the Six Nations: Native Americans After the Revolution
• The Revolution of 1800
• Jefferson and the Louisiana Purchase
• The Expansion of Democracy During the Jacksonian Era
• The Religious Roots of Abolition
• Individualism in Ralph Waldo Emerson’s “Self-Reliance”
• Aylmer’s Motivation in Nathaniel Hawthorne’s “The Birthmark”
• Thoreau’s Critique of Democracy in “Civil Disobedience”
• Hester’s A: The Red Badge of Wisdom
• “What to the Slave Is the Fourth of July?”
• The Cult of Domesticity
• The Family Life of the Enslaved
• A Pro-Slavery Argument, 1857
• The Underground Railroad
• The Enslaved and the Civil War
• Women, Temperance, and Domesticity
• “The Chinese Question from a Chinese Standpoint,” 1873
• “To Build a Fire”: An Environmentalist Interpretation
• Progressivism in the Factory
• Progressivism in the Home
• The “Aeroplane” as a Symbol of Modernism
• The “Phenomenon of Lindbergh”
• The Radio as New Technology: Blessing or Curse? A 1929 Debate

The Marshall Plan Speech: Rhetoric and Diplomacy

• NSC 68: America’s Cold War Blueprint
• The Moral Vision of Atticus Finch

Advisor: Philip Brenner, Professor, School of International Service, American University © 2016 National Humanities Center

Lesson Contents

Teacher’s note.

• Text Analysis & Close Reading Questions

Follow-Up Assignment

• Student Version PDF

What rhetorical and diplomatic challenges did Secretary of State George Marshall face as he delivered his 1947 Marshall Plan speech?

Understanding.

In his “Marshall Plan Speech” of June 5, 1947, Secretary of State George Marshall sought to describe the plight of post-War Europe, convince Congress and the American people that it was in the nation’s interest to relieve that plight, assure Europeans that America was not trying to dominate them, and calm the fears of the Soviets while warning them not to interfere with the initiative.

George C. Marshall, 50th United States Secretary of State

Marshall Plan Speech, June 5, 1947, Harvard University (transcript from recording, full text below). To hear a recording, click here .

Speech, historical, informational

Text Complexity

Grade 11-CCR complexity band.

For more information on text complexity see these resources from achievethecore.org .

In the Text Analysis section, Tier 2 vocabulary words are defined in pop-ups, and Tier 3 words are explained in brackets.

Click here for standards and skills for this lesson.

Common Core State Standards

• CCSS.ELA-LITERACY.RI.11-12.1 (cite evidence to analyze specifically and by inference)
• CCSS.ELA-LITERACY.RI.11-12.6 (determine author’s point of view)

Advanced Placement US History

• Key Concept 8.1 (IA) (…the US developed a foreign policy based on collective security…)

This lesson analyzes the 1947 speech in which Secretary of State George Marshall outlined America’s plan to rebuild Europe after World War II. It is suitable for use in English and history classes. For English teachers it offers a way to study paragraph development, the presentation of evidence, logic, and the structure of persuasive discourse. History teachers will be able to incorporate those topics into an exploration of the history of the Marshall Plan, its purposes, and the diplomacy required to launch it.

The speech roughly follows the classic five-part structure of argumentation — introduction, narrative, argument, rebuttal, conclusion — and we analyze it according to those categories. To keep the lesson to a manageable length, however, we do a close reading of the narrative, argument, and rebuttal sections only. Each one would make an excellent small group assignment. We explore the introduction and the conclusion in brief notes.

This lesson is divided into two parts, a teacher’s guide and a student version, both accessible below. The former includes a background essay, a textual analysis with close reading questions and responses, three interactive exercises, and an optional follow-up assignment. The first interactive exercise explores vocabulary in context; the second and third explore how Marshall deploys evidence. The student version of the lesson, an interactive PDF, includes all of the above, except the responses to the close reading questions and the follow-up assignment.

For a related lesson, see NSC 68: America’s Cold War Blueprint in America in Class ® Lessons.

Teacher’s Guide

Background questions.

• What kind of text are we dealing with?
• When was it written?
• Who wrote it?
• For what audience was it intended?
• For what purpose was it written?

The Marshall Plan, officially known as the European Recovery Program, is generally considered one of, if not the, most successful American foreign policy initiative since World War II. Nonetheless, historians still debate its goals. Was it a mission to relieve suffering, a plan to replicate American-style capitalism in Europe, a stimulus to boost the American economy, a brake to prevent Europe from backsliding into fascism, a strategy to frustrate Soviet expansion, or all of those things? Whatever it was, it was not on America’s diplomatic agenda when World War II ended in 1945.

The War left Europe devastated. People throughout the continent were poor; starvation was widespread. Countries did not have the money to rebuild roads, bridges, factories, and homes. Banks and other financial institutions were in ruins. European nations simply lacked the capacity to rebuild their economies on their own.

By 1947 it had become clear to policy makers in Washington and overseas that something needed to be done to address the plight of Europe. America took its first step in that direction when President Truman persuaded Congress to allocate funds to aid the government of Greece as it fought a civil war against a home-grown Communist resistance. The principle upon which that aid was based came to be known as the Truman Doctrine, a policy under which America pledged to support free peoples who were resisting subjugation by Communists or totalitarian forces.

In the spring of 1947 foreign ministers from Great Britain, the United States, and the Soviet Union met in Moscow to work out solutions to Europe’s economic woes. Secretary of State George Marshall, who had been the Army Chief of Staff during the War, represented the United States. At the conference Marshall became convinced that the Soviets were not interested in solving economic problems but rather were prepared to wait for the war-weakened nations of Europe to collapse and fall under its domination. Shortly after his return to Washington, he delivered a national radio address describing the problems in Europe and calling for immediate action to remedy them. He ordered his policy advisors to develop a plan for such action, and they soon put together a set of recommendations, which became the basis of the Marshall Plan.

Secretary Marshall and President Truman knew that it would not be easy to convince the American people and Congress to come to the aid of Europe, especially to help such a fierce former enemy as Germany. The United States had a long tradition of avoiding entangling relations with other countries. Even though World War II had, to say the least, deeply enmeshed the nation in foreign affairs in Europe and Asia and even though America emerged from the War as the only power capable of world leadership, many Americans still desired to avoid deep involvements abroad. And those Americans had strong allies in Congress, where Republicans held a majority. While the Republicans were split between isolationists and internationalists, even the latter were unlikely to support an aid program estimated to cost about $4 billion per year at a time when the entire federal budget was only $34.5 billion. The Truman administration embarked upon a massive publicity campaign to win both popular and Congressional support for American aid to Europe. Marshall was well-positioned to lead this effort as a revered wartime leader who was not considered a partisan of either political party. His brief speech at the Harvard commencement activities on June 5, 1947, described in simple blunt terms the problems of Europe and a possible solution to them.

While Marshall and his advisors crafted the speech primarily for the American public and for Congress, they had two other audiences in mind. The Plan required the cooperation of the people of Europe. In the speech Marshall sought to demonstrate that he and President Truman understood their plight and stood ready to help. However, he had to assure them that America did not intend to impose a solution but rather would assist in implementing remedies of their own design. Then there was the Soviet Union. The Plan was open to the Soviets, but they refused to participate, denouncing it instead as an American scheme to take over Europe. In his speech Marshall had to reassure the Soviets that the Plan did not threaten them, but he also had to assert that it would go ahead despite their opposition.

The administration’s campaign of persuasion worked. The Economic Cooperation Act of 1948 was signed on April 3 of that year, and the Marshall Plan was underway. Between 1948 and 1951 it cost $13 billion. To put that amount in perspective, in 2015 dollars it would be roughly $131 billion or, over a four-year period, an annual average expenditure of almost $33 billion. For further perspective, consider that, in 2016, the federal government plans to spend $33.7 billion in foreign aid for the entire world. During the years of the Marshall Plan, in today’s dollars, the total federal budget ranged from $316 billion to $449 billion. The current federal budget, at about $4,000 billion ($4 trillion), is roughly ten times larger than it was in 1951. This means that the percentage of the budget devoted to the Marshall Plan each year, around 9%, was far greater than the percentage allocated to all foreign aid today, less than 1%.

Marshall Plan dollars went to reconstruct Europe’s productive capacity, reestablish its financial systems, and restore its faith in industrial capitalism, with a special emphasis on American-style capitalism. They funded projects in Austria, Belgium, Denmark, France, Greece, Iceland, Ireland, Italy, Luxembourg, the Netherlands, Norway, Portugal, Sweden, Switzerland, Turkey, the United Kingdom, and western Germany. Each country used Marshall Plan support in a different way. Tensions and disagreements often arose between the giver of the aid and its recipients, but by 1950 the stage was set for an economic boom in Western Europe. For his leadership of the plan that bore his name, George Marshall received the Nobel Peace Prize in 1953.

This lesson focuses on Marshall’s Harvard speech, which roughly follows the classic five-part structure of argumentation: introduction, narrative or statement of fact, argument, rebuttal, and conclusion. We explore the introduction and conclusion in brief notes and closely analyze the narrative, argument, and rebuttal, while considering how the speech addressed the concerns of its multiple audiences.

Text Analysis

Introduction.

In an introduction the speaker tries to persuade the audience to like him or her so that they will pay attention to what is being said and agree with it. In addition, the speaker tries to interest the audience in the topic of the speech. The speaker may do this by pointing out how important the topic is or by stating the purpose of the speech. Marshall does all of these things in his first two paragraphs.

He clearly identifies at least one of his audiences, the American public, including the people assembled before him and those who will hear the speech on radio or read about it in newspapers.

In paragraph 1 he tries to win over his listeners by thanking them for the honor of speaking at Harvard and by displaying humility. He is “grateful,” “overwhelmed,” and “fearful” of his abilities to measure up to their expectations. In paragraph 2 he continues to woo the audience by flattering them. That the world situation is serious is apparent to “all intelligent people.” His audience is made up of such people, so he “need not tell” them that the world situation is serious, although, of course, he does. His emphasis on seriousness also signals that his topic is important, and his listeners should pay attention.

He goes on to identify a problem: the public cannot understand the complexity of the world situation because it is overwhelmed by the “mass of facts” presented in the media and because Americans are far removed from those “troubled areas,” the nations of Europe, which are making the world situation serious. Articulating this problem, he identifies the purpose of, at least, the next part of his speech: he is going to explain the world situation. Thus he prepares the audience for the next section of his address, the narrative .

Narrative or Statement of Facts

Close reading questions.

Note: In the narrative a speaker states the facts of his or her case. The speaker tells the audience what they need to know to make sense of the topic.

1. How does Marshall define the problem of Europe in 1947? According to Marshall, Europe’s problem is not chiefly one of physical destruction, a visible problem that can be solved with bricks, mortar, and paint. The problem goes deeper than that. It is, rather, an invisible problem, a failure of the economic system, a breakdown of the networks of trade and commerce, a problem that will require more than new construction. He goes on to illustrate this systemic problem in the next paragraph.

2. What, in Marshall’s view, caused this problem? Essentially, the Nazis. Before World War II European economies were devoted to war preparation, either as allies of the Nazis or as potential enemies. During the conflict itself European economies were devoted to fighting the War.

3. In what sense might it be said that Marshall, in calling for the economic rehabilitation of Europe, is arguing for the final defeat of the Nazis? While the Nazis were no longer a direct threat, the people of Europe were still suffering because of them. Economic rehabilitation would relieve that suffering and finally deliver Europeans from the lingering effects of Nazi domination.

4. The whole of Marshall’s speech is, of course, aimed at his Harvard audience and the American people. Why might the narrative portion of his address also find eager listeners in Europe? Because in describing the plight of Europeans, he is demonstrating that he, and by extension the United States government, understands their suffering and is sympathetic to it. To make his plan work, he will need the trust of the Europeans, and here he begins to his efforts to win it.

Note: Sentences 31 are 32 are pivotal in the speech. In 31 Marshall closes out the narrative. He has dealt with the lack-of-understanding problem from paragraph 2: “Thus (I hope you now understand) a very serious situation is rapidly developing…” Sentence 32 not only summarizes that “very serious situation” but also states a problem. He will devote the next part of speech to outlining his solution to that problem. Thus he moves on to the argument .

Note: The argument is the heart of any piece of persuasive writing. In it the speaker explains why the audience should support a proposition or take an action.

5. What is Marshall arguing for in paragraph 5? He wants America to provide Europe with “substantial additional help.”

6. In paragraph 6 he mentions a “remedy.” To what problem is he referring? The problem he cited at the end of paragraph 4: the danger that the “modern system of the division of labor” might collapse.

7. Thus far Marshall has focused on rebuilding the productive capacity of Europe — roads, factories, etc. — how, in paragraph 6, does he redefine the goal of American aid? Now the purpose is to restore the confidence of Europeans in the “economic future of their own countries.”

8. What arguments does he make to support his plan in paragraph 7? Failing to rescue Europe will demoralize the world, invite “disturbances,” and damage the American economy.

9. At what audiences does Marshall aim this portion of his speech? In this part of the speech he has moved from defining the problem to telling both the American and the European publics what the United States plans to do about it. Moreover, here he introduces the political consequences of inaction, which could be construed as an implicit warning to isolationists in Congress.

Note: Marshall knows that people at home and abroad will oppose his plan. To be persuasive, he must anticipate objections and address them, and he does that in the next section of his speech, the rebuttal .

Paragraph 7 [36] Aside from the demoralizing effect on the world at large and the possibilities of disturbances arising as a result of the desperation of the people concerned, the consequences to the economy of the United States should be apparent to all. [37] It is logical that the United States should do whatever it is able to do to assist in the return of normal economic health in the world, without which there can be no political stability and no assured peace.

Note: In a rebuttal the speaker acknowledges opposing views or criticisms and argues against them. A speaker who fails to do so would offer a weak, incomplete, and unconvincing case.

10. Why would Marshall say that his policy is aimed “not against any country or doctrine but against hunger, poverty, desperation, and chaos”? This removes his plan from the realm of ideology and frames it as a humanitarian initiative open to all European nations, including the Soviet Union.

11. What does Marshall mean when he says that American assistance must be a “cure rather than a mere palliative”? He envisions the American aid program not simply as a measure designed to get Europe over the immediate difficulties of post-war readjustment but rather as fundamental and permanent change that will set Europe on a course toward long-term economic prosperity.

12. Marshall issues warnings in paragraphs 8 and 9. Cite the language of his warnings. “Any government which maneuvers… will encounter the opposition of the United States.” “Furthermore, governments, political parties or groups which seek to perpetuate human misery… will encounter the opposition of the United States.”

13. Who is the audience for this warning? The Soviet Union.

14. How does Marshall avoid the charge that the United States is trying to impose its will upon Europe? He says that it would not be “fitting” or “efficacious” for the US to draw up a relief program for Europe. “This,” he explicitly asserts, “is the business of Europe.” The US can be a friend and supporter, but the nations of Europe must take the first step. In paragraph 9 he also says that participation in the program must be voluntary.

15. In his rebuttal Marshall does not state the criticisms he refutes, rather he implies them. Just as he anticipated criticism from foreign countries in paragraphs 8, 9, and 10, in paragraph 11 he anticipates criticism from his own country. What critics do you think he is addressing? He is aiming this rebuttal at isolationists in Congress and elsewhere who would argue that America should not get involved in foreign affairs and who would enflame heated political opposition to his proposal.

16. Cite the language Marshall uses to address American critics. “Political passion and prejudice should have no part.”

17. What does Marshall call upon the American people to do? We want Americans to understand the problem and the remedies. He is asking them to approach this situation through reason rather than emotion.

18. What does Marshall mean when he says that history has placed a “vast responsibility” upon America? He is alluding to the fact that the United States is the only major industrial power to have survived World War II in possession of a fully functioning economy and as such has a responsibility to assume leadership in world affairs.

Note: At this point Marshall is prepared to move to the final section of his speech, the conclusion .

Paragraph 10 [45] It is already evident that, before the United States Government can proceed much further in its efforts to alleviate the situation and help start the European world on its way to recovery, there must be some agreement among the countries of Europe as to the requirements of the situation and the part those countries themselves will take in order to give proper effect to whatever action might be undertaken by this Government. [46] It would be neither fitting nor efficacious for our Government to undertake to draw up unilaterally a program designed to place Europe on its feet economically. [47] This is the business of the Europeans. [48] The initiative I think, must come from Europe. The role of this country should consist of friendly aid in the drafting of a European program and of later support of such a program so far as it may be practical for us to do so. The program should be a joint one, agreed to by a number, if not all, European nations.

Paragraph 11 [49] An essential part of any successful action on the part of the United States is an understanding on the part of the people of America of the character of the problem and the remedies to be applied. [50] Political passion and prejudice should have no part. [51] With foresight , and a willingness on the part of our people to face up to the vast responsibility which history has clearly placed upon our country, the difficulties I have outlined can and will be overcome.

The conclusion of a speech is important because it presents the final words an audience hears, which often linger and shape the impression of an entire speech. Traditionally, speakers use conclusions to do four things:

• leave the audience with a favorable opinion,
• emphasize key points,
• stimulate an appropriate emotional response,
• summarize the argument.

In his conclusion Marshall does not have to worry about leaving a favorable opinion: he was one of the most highly regarded national leaders in 1947. (From the applause we hear in the recording of the speech, it is clear that the audience liked him and what he said.) He does, however, emphasize important points: that Americans must understand the complex situation in Europe, that the future depends upon rebuilding of Europe, and that Americans must make decisions about Europe based on reason and calm judgment.

Moreover, through the use of rhetorical questions, questions raised without the expectation of an answer, he summarizes his entire speech:

• What are the reactions of the people [of Europe]? (Desperation)
• What are the justifications of those reactions ? (Economic collapse)
• What are the sufferings [of the Europeans]? (Poverty and starvation)
• What is needed ? (Restoration of the European economy and confidence in the future)
• What can best be done ? (American aid)
• What must be done ? (Americans must agree to supply aid)

This is a particularly effective concluding strategy because, as Marshall says twice in the speech, he wants Americans to think about and understand the conditions in Europe so that they can make decisions based on reason. His questions at the end provoke thought rather than emotion. This comports with his overall avoidance of any sort of emotional appeal in the speech.

Ask your students to watch the eleven-minute film “ The Marshall Plan at Work ” (1950) from the German Historical Museum and have them respond to the following questions, either in discussion or in writing.

• How does the film portray post-War Germany?
• How does the film answer the question, why rebuild Germany?
• How does the film reflect the European economic problems Secretary of State Marshall outlined in his Harvard Commencement speech?
• How does the film portray the Marshall Plan as an anti-Soviet measure?
• Why did the Marshall Plan support farmers?
• Does the film portray the Marshall Plan as chiefly an economic or humanitarian endeavor?

Vocabulary Pop-Ups

• compliment: expression of honor
• accorded: given
• appraisement: judgment
• fabric: underlying framework
• feverish: intensely active
• engulfed: overwhelmed
• obsolete: old-fashioned
• arbitrary: unrestrained by law
• nationalization: takeover by government
• bodes: predicts
• deterioration: fall into ruin
• demoralizing: discouraging
• piecemeal: partial
• palliative: easing of symptoms
• maneuvers: moves
• alleviate: relieve
• efficacious: effective
• unilaterally: on its own
• initiative: first step
• foresight: prudence
• George C. Marshall, “The Marshall Plan Speech,” June 5, 1947. Harvard University, Boston, Massachusetts. http://marshallfoundation.org/marshall/the-marshall-plan/marshall-plan-speech
• “George C. Marshall, U.S. Secretary of State, January 21, 1947 to January 20, 1949,” photograph, U.S. Department of State. https://commons.wikimedia.org/wiki/File:George_C._Marshall,_U.S._Secretary_of_State.jpg
• “Marshall Plan Payments in Millions to European Economic Cooperation Countries, from April 3, 1948 to June 30, 1952,” color chart, The George C. Marshall Foundation. http://marshallfoundation.org/library/documents/marshall-plan-payments-millions-european-economic-cooperation-countries

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The Marshall Plan: History's Most Successful Structural Adjustment Program

The post-World War II reconstruction of Western Europe was one of the greatest economic policy and foreign policy successes of this century. "Folk wisdom" assigns a major role in successful reconstruction to the Marshall Plan: the program that transferred some $13 billion to Europe in the years 1948-51. We examine the economic effects of the Marshall Plan, and find that it was not large enough to have significantly accelerated recovery by financing investment, aiding the reconstruction of damaged infrastructure, or easing commodity bottlenecks. We argue, however, that the Marshall Plan did play a major role in setting the stage for post-World War II Western Europe's rapid growth. The conditions attached to Marshall Plan aid pushed European political economy in a direction that left its post World War II "mixed economies" with more "market" and less "controls" in the mix.

• Acknowledgements and Disclosures

MARC RIS BibTeΧ

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Published Versions

in Rudiger Dornbusch, et. al. (eds.) Post-World Warr II Economic Reconstru-ction and its Lessons for Eastern Europe Today, Cambridge: MIT Press, 1993

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Marshall Plan: Convince the American People

This lesson plan requires the classroom to be divided into proponents and opponents to the Marshall Plan.  Using primary documents from the Truman Library website https://www.trumanlibrary.gov/library/online-collections/truman-marshall-plan , the proponents will create a persuasive speech trying to convince a skeptical American public to support the measures of rebuilding war-torn Europe.  The opponents will use general arguments against the plan to formulate questions to ask the proponents after their speeches.  After presentations, students will construct an essay detailing both sides of the arguments and ultimately taking a side in the debate.

Basic skills are required for college and career readiness.  Of these, oral expression and supporting opinions with facts are keys to success.  This assignment allows students to develop these skills and acquire knowledge of the Marshall Plan.

• Identify the main arguments for and against the Marshall Plan
• Analyze primary sources related to the Marshall Plan
• Construct arguments to defend or refute the Marshall Plan
• AP-8  Describe and evaluate the evolution of United States domestic and foreign policies, including: Cold War
• AP-11  Examine all of the wars of the twentieth century (i.e., World War I and II), including: causes, comparisons, consequences and peace efforts
• AP-15  Determine the economic consequences of personal and public decisions
• AP-17  Explain the United States role in the global economy and of the roles of trade, treaties, international organizations and comparative advantage in the global economy
• 1.  Cite strong and thorough textual evidence to support analysis of what the text

says explicitly as well as inferences drawn from the text, including determining

where the text leaves matters uncertain.

• 1. Write arguments to support claims in an analysis of substantive topics or texts,

using valid reasoning and relevant and sufficient evidence

• a.  Introduce precise, knowledgeable claim(s), establish the significance of the

claim(s), distinguish the claim(s) from alternate or opposing claims, and

create an organization that logically sequences claim(s), counterclaims,

reasons, and evidence.

• b. Develop claim(s) and counterclaims fairly and thoroughly, supplying the

most relevant evidence for each while pointing out the strengths and

limitations of both in a manner that anticipates the audience’s knowledge

level, concerns, values, and possible biases.

• 4.  Produce clear and coherent writing in which the development, organization,

and style are appropriate to task, purpose, and audience. (Grade-specific

expectations for writing types are defined in standards 1–3 above.)

• 4.  Present information, findings, and supporting evidence, conveying a clear

and distinct perspective, such that listeners can follow the line of reasoning,

alternative or opposing perspectives are addressed, and the organization,

development, substance, and style are appropriate to purpose, audience, and a

range of formal and informal tasks.

• Nation of Nations
• Nick Cullather, Indiana University.  “CIA and the Marshall Plan:  The Paradoxes of Liberal Anti-Communism”.  Presented at Ninth Annual Truman Library Teachers Conference.  The Legacy of the Marshall Plan.  July 9-13, 2012
• “Who is the Man Against the Marshall Plan?”, Committee for the Marshall Plan to Aid European Recovery.  Harry S. Truman Library and Museum, The Legacy of the Marshall Plan. Marshall Plan, p.25.
• Speech by Dean Acheson, "The Requirements of Reconstruction", May 8, 1947 
• Development of Foreign Reconstruction Policy, March-July 1947, ca. September 1947  
• "The Immediate Need for Emergency Aid to Europe", September 29, 1947  
• Report, "German Agricultural and Food Requirements", February 26, 1947  
• Correspondence between Ray Moseley and Harry S. Truman, November 26, 1947  
• https://www.trumanlibrary.gov/library/online-collections/truman-marshall-plan
• https://www.marshallfoundation.org/marshall/the-marshall-plan/
• Start Activity – Display the following quick writing prompt so all students can see, “What would be the advantages and disadvantages of rebuilding a country we have defeated in war?”  Discuss the student answers to get a preview of the pros and cons of this issue.
• Provide the necessary background information necessary for students to have a basic knowledge of the Marshall Plan.
• Divide the class into 2 groups.  Assign one group to research arguments supporting the Marshall Plan and the other group to develop arguments against the Marshall Plan.
• Provide students with a packet of the following primary documents from these websites https://www.trumanlibrary.gov/library/online-collections/truman-marshall-plan https://www.marshallfoundation.org/marshall/the-marshall-plan/ https://www.trumanlibrary.gov/library/online-collections/truman-doctrine
• Provide time for student groups to analyze the primary documents and review the secondary sources.  Assign the remaining analyses to be done at home.  Instruct students to bring to class any questions they have about the documents the next day.
• Provide time for the student groups to develop arguments, speeches, and questions for the opposing side.  It is the teacher’s option whether to provide time to revise student speeches.
• Present the speeches in favor of the Marshall Plan.  After each speech, allow students that are part of the opposing side to ask questions or present arguments against the Marshall Plan.

As a capstone, students will write a persuasive essay on whether to accept or reject the Marshall Plan

http://rubistar.4teachers.org/index.php

ESSAY SAUCE

FOR STUDENTS : ALL THE INGREDIENTS OF A GOOD ESSAY

Essay: The Marshall Plan (European Recovery Program)

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The Marshall Plan, officially called the European Recovery Program, was a key moment in the cold war as it affected all of Europe. It also, potentially more importantly, changed the dynamic between the superpowers. The Marshall plan was as a result of American self-interest. There are three dimensions to the motives behind Marshall Aid: Political, Economic and Social. The Marshall plan was a result of self interest, if within these three areas the US designed the plan in such a way that they would be able to gain, financially and/or politically. Historians generally agree that the Marshall plan was motivated by a combination of the three areas but they put more emphasis on different aspects of the three areas. Oliver Edwards gives a very credible interpretation where the focus is on improving social conditions in an attempt inhibit the increasing support the communist party was enjoying , he also suggests there was a desire to create a captive American export market. Both of these areas are corroborated by other historians and primary sources, George C. Herring corroborates this interpretation by also saying ‘the administration sought to use U.S. aid to check an alarming leftward drift in European politics.’ Another strong interpretation is Martin McCauleys, who suggests that the reduction of the financial burden on the American taxpayer was the central aim of the Marshall plan, this is certainly credible as it is backed up by correspondence between Truman and Herbert Hoover discussing the issue and solutions prior to the creation of the Marshall plan. However the interpretation seems to lack the necessary width as it focuses on the economic aims and fails to give enough credit to other major factors such as the political. There are also interpretations that are weaker but cannot be discounted such as Niall Ferguson’s’ who emphasises the Americans desire to improve economies and militaries linked to their own. This interpretation is supported by the strong anti-communist feeling at the time but weakened by the consensus among historians that social revolution was much more likely than Soviet aggression in Europe, therefore supporting Oliver Edwards interpretation. The strongest interpretation, however is Diane B. Kunz’s, she agrees with Oliver Edwards on the political aim of improving social conditions which would reduce the communist support in Western Europe. Diane B. Kunz also attributes credit to reducing the financial burden on taxpayers, which is supported by Martin McCauley and it is backed up by correspondence between key policy makers at the time. No credible interpretation suggests that the Marshall plan was altruistic and not in the US’ interest. Despite the administration knowing about the ‘long-suffering peoples’ in Europe and Truman’s acceptance of responsibility in their occupied areas, the Marshall plan was not just a recovery programme, but an attempt to capitalise on post-war Europe. The first section will look at the political aims of the Marshall plan, the second section will evaluate the arguments and interpretations that focus on the economic intentions of the Marshall plan, and the third will be around the social aims which will largely suggest the plan is altruistic as the social aims were about improving conditions for people in Europe and therefore were not of direct benefit to the US, however the altruistic motivations behind the marshall plan were not completely benevolent.

Political motivations behind the Marshall Plan.

In the late 1940s there was increasing fear of democratic social revolution in Western Europe as the horrendous living standards and economic displacement which was preventing recovery caused people to look to the radical left for a solution. After the extremely cold winter of 1946-1947 and coal shortages there were food riots in the western occupation zones in Germany. Oliver Edwards says that the ‘Americans had long believed that people who were hungry and unemployed were likely to turn to extreme of the left for solutions to their problems.’ The increase in support for the left in Europe was scaring the policy makers in Washington. This is corroborated by Diane B. Kunz’s view that Americans feared ‘a hungry, suffering electorate might vote communist governments into power’, Kunz and Edwards’ interpretation corroborate each others, as they both focus on the Americans knowledge and concern about how terrible living conditions can sway the electorate, this therefore increases the credibility of the argument. This is also backed up by Kennan’s analysis of the Soviet threat as one of propaganda aimed at promoting social revolution by those within ‘poverty-stricken states rather than a direct military invasion’. Marshall assigned Kennan to direct a new policy planning unit, the analysis therefore would affect policy and in turn the Marshall plan, this increases the validity of the interpretation. Truman’s speech to congress explains the American viewpoint well; The seeds of totalitarian regimes are nurtured by misery and want. They spread and grow in the evil soil of poverty and strife. They reach their full potential when the hope of a people for a better life has died. We must keep that hope alive. If we falter in our leadership, we may endanger the peace of the world – and we shall surely endanger the welfare of our own nation. Despite the clear message of his speech it is not as useful as it seems in understanding the Marshall plans motives, Truman knew what he had to say to get the Marshall plan passed by congress, he knew that an anti-communist plan would be supported. A plan to improve the economies in western Europe on a social basis or to create an export market for the US, it probably would not have been accepted, meaning the anti-communist rhetoric may not have been the most significant reason behind the plan. However the anti-communist agenda Truman gave is definitely accurate to some extent, the fear of soviet expansionism was evident at the Potsdam conference when Truman accused Stalin of not sticking to the democratic agreement made at Yalta. Despite the speech’s failure to acknowledge the other motives, it does not mean the one it does acknowledge has its validity decreased. The source also gives a insight into how the political motivations of the plan were in America’s self interest; not only would the peace of the world be endangered but so would the welfare of America. The tone of the speech is very much about what will happen to the US if they do not act rather than what will happen if they do. In France and Italy communist parties were in coalition governments and received about 20 percent of the vote, Italian elections were coming up in April 1948 and there was a possibility of a communist victory. Communist party members in Italy had grown to two million and the fear was so great that there was a campaign to encourage Italian-Americans to send letters urging family members in Italy not to vote communist in the election; 10 million letters were sent. This backs up the Truman administration being very fearful of communists gaining power. The legislation for the Marshall plan was only passed by the traditionally isolationist congress after the coup in Czechoslovakia showed the Soviets to be expansionist. Communist victories would mean European governments seeking closer ties with Moscow, giving them more control over Europe and affecting the global balance of power. Oliver Edward’s and Diane B. Kunz’s interpretation are therefore very strong and supports the Marshall plan being as a result of American self-interest. The Truman administration knew relations between the superpowers had broken down by 1947, as shown by Truman signing off on Churchill’s iron curtain speech. Therefore a desire to improve both the economies and militaries within their sphere of influence was only natural, this is possibly one of the Marshall plans aims. Although this is the weakest argument it cannot be totally discounted. Niall Ferguson more so than any other historian indicates that the Americans used Marshall aid to improve economies and militaries in allied countries. ‘The essence of American “hegemony” was the preferential treatment of American allies when it came to the allocation of loans and grants (whether for development or military purposes).’ This interpretation is corroborated by Walter LaFeber who says Kennan ‘insisted that any aid, particularly military supplies, be limited and not given to just any area where communists seemed to be enjoying some success’, the fear of communists taking over an area where the Americans gave military supplies was significant, therefore supporting Niall Ferguson’s interpretation that the communists were potentially a military threat. Kennan, in 1951, said ‘the greatest danger that could confront the United States security would be a combination’ ‘of the Central European and the Russian military-industrial potentials’, therefore avoiding feeding those who potentially could turn against them was important. Kennan said this in 1951, after Cominform was implemented, before it was however the Americans thought they could decrease the Eastern European states dependence on the USSR through improving their economy, therefore going against what Kennan said in 1951. In 1951 a deal between the US and Yugoslavia was signed that would give Yugoslavia 150 million as Tito had been expelled from Cominform for following a different line to Stalin. The fear of the combined forces of Central Europe and Russia will have been present when the Marshall plan was being created, which means they are unlikely to have planned to put a lot of military in Central Europe until later, when Europe was clearly divided. Diane B. Kunz’s and most historians interpretation disagree with that of Niall Ferguson’s because as Diane B. Kunz put it ‘the administration were not worried about Soviet tanks in Paris or Rome’. But instead social revolution due to poor economic conditions. This interpretation is not very strong but it does not support the Marshall plan being altruistic, instead it goes some way to corroborating Oliver Edwards interpretation. The argument and in turn Niall Ferguson’s interpretation is quite weak as it is questioned by numerous interpretations. Germany was strategically very important in Europe in 1947 as there was a large amount of uncertainty as to what would happen to it; whether it would reunify and, a question more prevalent in the minds of Americans and Soviets, if it did reunify which side would it align itself with or would it remain neutral. The Americans took the position that to prevent the Soviets from benefiting from it’s industrial power, they were not going to allow a reunified Germany. Robert J. McMahon, suggests that as a secondary purpose the Marshall plan was driven by the desire to divide Germany into definitive blocs. McMahon states the Americans preferred ‘to divide the country rather than to run the risk of a reunified Germany that might over time align itself with the Soviet Union.’ Marshall’s insistence that Germany take part in the plan caused any hopes of German reunification to be dashed. Cominform was founded as a direct result of the plan, it was used to instruct countries the Soviet sphere what line they should follow and in this case specifically to not take aid from the US. Chief Russian delegate Andrei Zhdanov said the Marshall Plan was a concerted strategy to forge a western alliance that would serve as a ‘jumping off place for attacking the Soviet Union’, speaking in September 1947, he said the world was now divided into ‘two camps’. However Andrei Zhdanov was the architect of much of the propaganda from 1945 meaning he is not a credible source. Furthermore the context in which Zhdanov made his statement is intrinsic in understanding it, it was made at the conference which established cominform, meaning it was almost justifying the formation of cominform. However the Soviets feeling need for cominform shows their view of the Marshall plan; that it was aggressive and gave them control over the west meaning they needed control of the east. Zhdanov’s statement that the world is now divided into two camps is accurate as the Marshall plan and Cominform gave both superpowers political sway in their spheres of influence, although there is debate whether the east and west were already divided as stated in Churchill’s iron curtain speech, the world was more divided than ever after the Marshall plan. A high-ranking diplomat privately admitted that America would not agree with any terms that the Russians would accept, the fear of a reunified Germany that over time may align itself with the Soviets meant dividing the country was the preferred option. There were other factors in the division of Germany such as the Berlin Blockade and the currency issues in Berlin, so the Marshall plan instead of dividing Europe it instead reinforced the divisions that were already taking place in Germany and Europe. The strength of this interpretation lies in the effects of the Marshall Plan as it caused Europe to fall into two now more easily defendable blocs. However there is little to suggest in the correspondence between policy makers dividing Europe was a goal of Marshall aid, furthermore it would not have been a publicised aim as they did want to be blamed for the division of Europe. This interpretation is corroborated by Michael J. Hogan who says the man-power, markets and industrial potential were strategic assets and must not be controlled by a hostile power. Michael J. Hogan suggests the same as McMahon; that the Americans preferred to divide Europe, rather than risk any part of it falling into the hand of the Soviets. The Americans were not afraid of a Military invasion but instead that through worsening social conditions, allegiances with the Soviets would be formed and they would gain/lose control of Europe’s vast industrial potential. Robert J. McMahon’s interpretation is very credible but fails to deal with the wider financial aims of industry helping the rest of Europe. McMahon’s interpretation is also closely linked to Diane B. Kunz and Oliver Edwards’ interpretation as dividing Europe would enable the Americans to more easily stop Soviet expansionism into Western Europe.

Economic motivations behind the Marshall Plan

There was pressure from congress for Truman to reduce the financial burden of supporting European recovery, despite the Marshall plan making up half of American aid for the period, it put practices in place that would aid recovery for example countries were given American financial advisors to help with recovery. Martin McCauley puts great emphasis on the Americans desire to reduce ‘the burden of occupational costs, as well as the expense of propping up the German economy.’ In January 1947 Truman asked Herbert Hoover to report, for the second time, on the food requirements of the people in their occupied zones, especially in Germany. In response Herbert Hoover agreed and suggested he also inquire into ‘what further immediate steps are possible to increase their exports and thus their ability to become self-supporting’ without such ‘the congress and the taxpayer are left without hope’. The message from Hoover is clear; both congress and the taxpayer will not be happy to continue shouldering the financial burden of supporting German and European recovery. Despite Hoover and Truman being friends the tone of the letter is that of a stern warning, the letter is not public so it’s purpose is purely to inform Truman so what he says will not affect the way the public view him which means the warning to Truman is sincere. This therefore, supports Martin McCauley’s interpretation, as there was growing discontent among congress and taxpayers at having to support Europe, hence the reduction of this was an aim of the Marshall plan. Marshall was tasked with coming up to a solution; the Marshall plan was used to increase production in and exports from Germany, at the same time the economies of western Europe were tied together, this aided recovery and in turn decreased the financial burden on American taxpayers.This is supported by the fact the collapse of Europe would have cost the Americans much more than it did through aid and recovery. Diane B. Kunz corroborates this interpretation by stating Truman and his administration ‘viewed the Marshall plan, with a longer-range vision’ ‘,it would help Western Europe rebuild the industrial base that was the key to European prosperity, eventually obviating the need for further American assistance.’ Kunz’s interpretation adds credibility McCauleys as they both focus on the plan’s ability to reduce financial burden on the taxpayer. The interpretation can be seen in action in the years following the plan; from 1946 to 1952 economic aid accounted for nearly 2 percent of US GNP, half of which was Marshall aid, in the following decade it dropped below 1 percent. The interpretation therefore is very strong as it can be seen in effect, Europe’s reliance on America for support is reduced and with it the burden on the American taxpayer. The creation of a captive market in Europe was not the primary purpose of the Marshall plan but rather the Americans may have been fortuitous, in that their primary aims lined up with this secondary aim. More likely however is that the creation of an American market in Europe was intentional and deliberate, and therefore was in America’s self-interest. Oliver Edward’s interpretation is supported by many historians interpretations. Creating a captive market for American goods in Europe was a secondary motive behind the political and reducing the financial burden on the taxpayer. Oliver Edwards states that Marshall aid would create a market in Europe and ‘help American farmers and businessmen threatened by falling domestic demand after the end of the second world war’. This interpretation is supported by Martin McCauley who suggests the Marshall plan had a political and economic goal. ‘It’s political goal was to contain communism, its economic aim was to bring prosperity to Europe and thereby to provide export markets for the US economy’. The Atlantic Charter which set out the principles the postwar world should be built agreed upon by Churchill and Roosevelt in 1941. The first point says ‘no territorial gains were to be sought by the United States or the United Kingdom’, which advocates the idea that the Americans were not looking to benefit from the devastated states of Europe. However it fails to state that it will not attempt to gain financially from the situation, reparations are owed, but the omission that they would not profit from postwar Europe alludes to the idea that they will attempt to gain or that they are unwilling to state that they will not attempt to gain. This is backed up by talks in Paris in 1947 as they were in built around the assumption aid was to be organised centrally not bilaterally and that economies were to be open up and do more trade with both the US and the rest of Europe. American funds given through aid to Europe were to be used to purchase American supplies, an example of this is the American oil companies wanting to sell oil to the Europeans but the Europeans wanted to buy crude oil and buy refineries, when the American oil companies complained the Economic Cooperation Administration denied Europeans money to build refineries. Oliver Edwards interpretation, therefore, is strong because it shows appreciation for other motivations such as the financial burden on US taxpayers, and even the supposedly altruistic Atlantic Charter has implications of American financial gain from Europe which adds to the credibility of Oliver Edwards interpretation. One of the United States most significant aims for foreign policy during the period after the first world war was the reduction of international trade barriers. As Michael J. Hogan said ‘Truman wanted reintegration of Europe and the US into a multilateral system of world trade’. This is another factor contributing to the ideological disagreement between the US and USSR as autarkic economies ,such as the one Stalin desired, this would not work within the global system the US wanted to implement. The desire to reduce trade barriers was evident in previous attempts to provide economic aid, in May 1946 a loan was negotiated between France and the US, the US wrote off $2.25 billion of wartime loans and gave hundreds of millions of dollars in credits and promised low-interest loans to come. In return, Paris pledged to abandon protectionist import quotas and allow Americans and other foreign products freer entry. US loans and financial aid was used throughout this period to improve international aid and create closer cooperation internationally. This interpretation is backed up by Niall Ferguson who suggests the US ‘embarked on a sustained push to reduce international trade barriers through multinational negotiations’. This interpretation and the argument for the Marshall plan to be as a result of American self-interest is supported by the US’ loan deals prior to the Marshall plan; a loan to the British in 1946 was used by the Americans to impose substantial requirements such as sterling-dollar convertibility, lower tariffs, and participation in an international trade conference. Michael J. Hogan’s interpretation is very strong as it is in line with the Americans foreign policy aims at the time, however it is not completely convincing that a desire to implement a multilateral system of world trade and therefore other interpretations such as Diane B. Kunz and Oliver Edwards as they give an interpretation which the Marshall plan can be seen achieving.

Social motivations behind the Marshall Plan

No credible interpretation claims that Marshall aid was carried out purely due to altruistic aims and in turn to improve the social conditions in Europe. However it was possibly a significant factor, as the desire to improve living standards for those in dire situations is very powerful. The plan was rationalised in government as a method of containment that would also improve the living standards in Europe although containment was the much more powerful motivator of the two, the public reasons given were both political and altruistic as well. A large portion of George C. Marshall’s speech announcing the European Recovery Program was dedicated to informing the public about the terrible conditions in Europe. Truman knew that conditions in Europe were bleak so in a letter to Hoover, he asks for a ‘food survey’ in the areas ‘occupied by our forces and for which we, therefore, have a direct responsibility’. The letter is a private correspondence to inform Hoover of his task, it was produced in January 1947, the report produced thereafter would have affected the construction of the recovery program as the needs of Europe would be used to determine amount of aid given. The Marshall plan was aimed at recovery and therefore gradually bringing Europe back to the state it in was pre-war, with changes in how it was run economically but socially the same. However it also had to solve the French fear of a powerful Germany and this was done not only through Marshall aid but other things such as assurances when West Germany was included in NATO. France desperately needed German reparations, which were replaced by US credits, and bringing the French and German economies closer together reduced the French fear of a German economic power. The French problem is an example of a slightly altruistic outcome of the Marshall plan, it was a known issue but to improve it was not a key aim of the Marshall plan. The improvement came about as European economies were tied closer together which was aligned with other aims of the plan, such as multilateral trade, and US credits were to be given as part of the plan which decreased the requirement of German reparations. This benefitted the French and could be seen as altruistic but in actual fact it was a means of achieving their other aims through which the improvement in relations and living standards was brought about. Another consequence of the plan was that it provided a huge psychological boost and restored optimism to those in West Europe, this was again an almost inevitable consequence of aid. Giving countries aid, improving their economy, trade, and living standards is bound to increase optimism and hope for improvement. However as stated at the beginning of this section the desire to improve people’s living standards was possibly a driving factor of the program, the desire for a global improvement was shown in the 1941 Atlantic charter, where Roosevelt and Churchill agreed on terms that the post-war world should be predicated such as; ‘global economic cooperation and advancement of social welfare’ and that they ‘would work for a world free of want and fear’. This demonstrates the Americans high-mindedness in the 1940s although it was a statement of policy which the vast majority of the electorate would agree, it was not legal or a plan to deal with specified issues. This decreases its impact as the time but does not decrease the credibility it lends to the mindset of American policymakers at the time. The structure of Marshall aid itself suggests the plan was altruistic; 20% were loans 80 % were grants, the first shipments were food and fertilisers then machines to improve agriculture efficiency, both of which would improve living standards suggesting its altruistic. The improvement in social and economic conditions that could be put down to American policy makers altruism were in reality, a way of containing communism, in this sense the improvement in living standards were a means to an end for the Truman administration. This furthers the argument for the Marshall plan being as a result of American self interest.

The political dimension of the Marshall plan is the most important, communists gaining power democratically especially in France and Italy was a serious concern for the Truman administration with them commanding about 20 percent of the vote. Social revolution was much more likely than military invasion by the Soviets, which decreases the validity of Niall Ferguson’s interpretation, and increases the validity in Diane B. Kunz and Oliver Edwards’ interpretation. Robert J. McMahon’s interpretation that the Marshall plans purpose was to divide Europe is accurate to some extent, as it did, at least in part cause the division of Europe, however there is very little evidence from the time which suggest this was an intentional consequence of Marshall aid. The most credible interpretation in the political section is Diane B. Kunz and Oliver Edwards and therefore the political aims of the plan were as a result of American self-interest. The Economic aspect of the Marshall plans intentions are also due to American self-interest, Martin McCauley says the most significant of which was as Herbert Hoover said to reduce the support paid by the American taxpayer, Diane B. Kunz corroborates this argument. This was a significant aim particularly because the US congress was becoming increasingly less willing to fund the reconstruction of Europe. Oliver Edwards’ interpretation is that the US wanted to create a captive market in Europe, which is reinforced by Martin McCauley and backed up by Truman who believed for America’s economy to thrive a large export market was required. It was however a secondary aim, the plan was not based around creating trade but instead by the economies recovering, increased trade would be a by-product. The desire for multilateral trade goes hand in hand with the market in Europe, the US throughout the period wanted to decrease trade barriers, as they were an economic power they were able to dominate markets when could access them with no restrictions. The US had shown they were willing to use aid to reduce trade boundaries, for example the French loan in May 1946, Michael J. Hogan’s interpretation therefore is strong, meaning all of the economic aims of the Marshall plan were in the US’ interest. The improvement of social conditions in Europe were not altruistic, they were a means to an end, they reduced support for capitalism and were a by product of improving economies to reduce the financial burden on the American taxpayer. However there was knowledge of the terrible living standards in Europe due to both the physical damage and loss of life and the economic displacement which was inhibiting recovery, Truman wanted to improve these conditions in part because he saw the occupied areas of europe as the US’ responsibility, in these aspect of the marshall plan’s causes for being made were altruistic. The Marshall plan, however was overwhelmingly due to American self-interest, there was need for aid in Europe 0but the previous loans were benefiting the countries in Europe, the Marshall plan allowed the US to benefit both politically and economically.

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