THE MARSHALL PLAN A RETROSPECTIVE*
The Marshall Plan was a second attempt by the United States to assist in European economic recovery after the Second World War. The US had already made available to Western Europe $10 billion from July 1945 to June 1947, including the loan of $3.75 billion to the United Kingdom, $2.7 billion in relief through UNRAA and GARIOA and $1.9 billion in credits for the purchase of Army surplus etc. 1
By the spring of 1947 it was widely felt in Washington that this aid had been insufficient to put recovery on a firm footing and that a fresh effort should be mounted. Articles in the press and memoranda in the State Department developed the idea of a ‘continent-wide European Recovery Plan’. 2 General Marshall and Will Clayton, Secretary and Undersecretary of State in the State Department, had both returned from visits to Europe much exercised by what they had seen. Clayton in particular had the impression of imminent economic collapse. On 5 June, General Marshall in a speech at Harvard, offered US help if Europe would take the initiative. Behind the offer lay a mixture of political and economic considerations.
At the political level the first consideration was the containment of Soviet expansion. In March the President had enunciated the Truman Doctrine after the United States had been obliged to take over from the United Kingdom support of the governments of Greece and Turkey. Without the prospect of greater prosperity, Germany, and to a lesser degree France and Italy, risked a Communist takeover. In the case of Germany, which was of particular importance, the United States was already committed, along with the United Kingdom, to make the Bi-zone self-supporting within three years. 3 German economic recovery was indispensable to European economic recovery but could only take place within a framework acceptable to its neighbours which a European Recovery Plan might provide. In any event, the Plan was designed to embrace the whole of Europe and allow a joint effort to use all available
* From The New Palgrave Dictionary of Money and Finance (The Macmillan Press, Ltd, 1992), where the article appears under the title ‘The Marshall Plan’. I am indebted to the publisher for permission to reprint the article.