Marshall Plan

European Recovery Program redirects here. It is not to

be confused with European Economic Recovery Plan.
The Marshall Plan (ocially the European Recov-

The labeling used on Marshall Plan aid packages

George Marshall seen as General of the Army before becoming
Secretary of State. It was during his term that he campaigned
for and was trusted to implement the Marshall plan which was
named for him.

ery Program, ERP) was an American initiative to aid

Western Europe, in which the United States gave over
$12 billion[1] (approximately $120 billion in current dollar value as of June 2016) in economic support to help
rebuild Western European economies after the end of
World War II. The plan was in operation for four years
beginning April 8, 1948. The goals of the United States
were to rebuild war-devastated regions, remove trade
barriers, modernize industry, make Europe prosperous
again, and prevent the spread of communism.[2] The Marshall Plan required a lessening of interstate barriers, a
dropping of many regulations, and encouraged an increase in productivity, labour union membership, as well
as the adoption of modern business procedures.[3]

the United Kingdom (receiving about 26% of the total),

followed by France (18%) and West Germany (11%).
Some 18 European countries received Plan benets.[4]
Although oered participation, the Soviet Union refused
Plan benets, and also blocked benets to Eastern Bloc
countries, such as East Germany and Poland. The United
States provided similar aid programs in Asia, but they
were not called Marshall Plan.
The initiative is named after Secretary of State George
Marshall. The plan had bipartisan support in Washington, where the Republicans controlled Congress and the
Democrats controlled the White House with Harry S.
Truman as president. The Plan was largely the creation
of State Department ocials, especially William L. Clayton and George F. Kennan, with help from the Brookings
Institution, as requested by Senator Arthur H. Vandenberg, chairman of the Senate Foreign Relations Commit-

The Marshall Plan aid was divided amongst the participant states roughly on a per capita basis. A larger amount
was given to the major industrial powers, as the prevailing opinion was that their resuscitation was essential for
general European revival. Somewhat more aid per capita
was also directed towards the Allied nations, with less for
those that had been part of the Axis or remained neutral. The largest recipient of Marshall Plan money was
1

WARTIME DESTRUCTION

tee.[5] Marshall spoke of an urgent need to help the European recovery in his address at Harvard University in
June 1947.[2] The purpose of the Marshall Plan was to
aid in the economic recovery of nations after WWII as
well as to antagonize the Soviet Union. In order to combat the eects of the Marshall Plan, the USSR developed
its own economic plan, known as the Molotov Plan.[6]

in European recovery was expressed by Paul Homan,

head of the Economic Cooperation Administration, in
1949, when he told Congress Marshall aid had provided
the critical margin on which other investment needed
for European recovery depended.[17] The Marshall Plan
was one of the rst elements of European integration, as it
erased trade barriers and set up institutions to coordinate
The phrase equivalent of the Marshall Plan is often the economy on a continental levelthat is, it stimulated
the total political reconstruction of western Europe.[18]
used to describe a proposed large-scale economic rescue
program.[7]
Belgian economic historian Herman Van der Wee concludes the Marshall Plan was a great success":

Development and deployment

The reconstruction plan, developed at a meeting of the

participating European states, was drafted on June 5,
1947. It oered the same aid to the Soviet Union and
its allies, but they refused to accept it,[8][9] as doing so
would allow a degree of US control over the Communist economies.[10] In fact, the Soviet Union prevented its
satellite states (i.e., East Germany, Poland, etc.) from accepting. Secretary Marshall became convinced Stalin had
no interest in helping restore economic health in Western
Europe.[11]

It gave a new impetus to reconstruction in

Western Europe and made a decisive contribution to the renewal of the transport system,
the modernization of industrial and agricultural
equipment, the resumption of normal production, the raising of productivity, and the facilitating of intra-European trade.[19]

President Harry Truman signed the Marshall Plan on

April 3, 1948, granting $5 billion in aid to 16 European
nations. During the four years the plan was in eect, the
United States donated $13 billion in economic and technical assistance to help the recovery of the European countries that joined the Organization for European Economic
Co-operation. In 2013, the equivalent sum reecting currency ination since 1948 was roughly $148 billion.[12]
The $13 billion was in the context of a US GDP of $258
billion in 1948, and on top of $13 billion in American
aid to Europe between the end of the war and the start
of the Plan that is counted separately from the Marshall
Plan.[13] The Marshall Plan was replaced by the Mutual
Security Plan at the end of 1951; that new plan gave away
about $7 billion annually until 1961 when it was replaced
European Recovery Program expenditures by country
by another program.[14]
The ERP addressed each of the obstacles to postwar recovery. The plan looked to the future, and did not focus
on the destruction caused by the war. Much more impor2 Wartime destruction
tant were eorts to modernize European industrial and
business practices using high-eciency American models, reducing articial trade barriers, and instilling a sense By the end of World War II, much of Europe was devastated. Sustained aerial bombardment during the war had
of hope and self-reliance.[15]
badly damaged most major cities, and industrial faciliBy 1952, as the funding ended, the economy of every par- ties were especially hard-hit.[20] The regions trade ows
ticipant state had surpassed pre-war levels; for all Mar- had been thoroughly disrupted; millions were in refugee
shall Plan recipients, output in 1951 was at least 35% camps living on aid from United Nations Relief and Rehigher than in 1938.[16] Over the next two decades, West- habilitation Administration and other agencies. Food
ern Europe enjoyed unprecedented growth and prosper- shortages were severe, especially in the harsh winter of
ity, but economists are not sure what proportion was due 19461947. From July 1945 through June 1946, the
directly to the ERP, what proportion indirectly, and how United States shipped 16.5 million tons of food, primarmuch would have happened without it.
ily wheat, to Europe and Japan. It amounted to 1/6 of the
A common American interpretation of the programs role American food supply, and provided 35 trillion calories,

3.1

Slow recovery

enough to provide 400 calories a day for one year to 300 During the rst three years of occupation of Germany the
million people.[21]
UK and US vigorously pursued a military disarmament
Especially damaged was transportation infrastructure, as program in Germany, partly by removal of equipment but
railways, bridges, and docks had been specically tar- mainly through an import embargo on raw materials, part
Plan approved by President Franklin
geted by air strikes, while much merchant shipping had of the Morgenthau
[29]
D.
Roosevelt.
been sunk. Although most small towns and villages had
not suered as much damage, the destruction of transportation left them economically isolated. None of these
problems could be easily remedied, as most nations engaged in the war had exhausted their treasuries in the
process.[22]

Nicholas Balabkins concludes that as long as German industrial capacity was kept idle the economic recovery of
Europe was delayed.[30] By July 1947 Washington realized that economic recovery in Europe could not go forward without the reconstruction of the German industrial
base, deciding that an orderly, prosperous Europe requires the economic contributions of a stable and productive Germany.[31] In addition, the strength of Moscowcontrolled communist parties in France and Italy worried
Washington.[32]

The only major powers whose infrastructure had not been

signicantly harmed in World War II were the United
States and Canada. They were much more prosperous
than before the war but exports were a small factor in
their economy. Much of the Marshall Plan aid would be
used by the Europeans to buy manufactured goods and In the view of the State Department under President
raw materials from the United States and Canada.[23]
Harry S Truman, the United States needed to adopt a definite position on the world scene or fear losing credibility. The emerging doctrine of containment (as opposed to
rollback) argued that the United States needed to substantially
aid non-communist countries to stop the spread of
3 Initial post-war events
Soviet inuence. There was also some hope that the Eastern Bloc nations would join the plan, and thus be pulled
3.1 Slow recovery
out of the emerging Soviet bloc, but that did not happen.
Europes economies were recovering slowly, as unemployment and food shortages led to strikes and unrest in
several nations. In 1947 the European economies were
still well below their pre-war levels and were showing
few signs of growth. Agricultural production was 83% of
1938 levels, industrial production was 88%, and exports
only 59%.[24] In Britain the situation was not as severe.[25]
In Germany in 194546 housing and food conditions
were bad, as the disruption of transport, markets and nances slowed a return to normality. In the West, bombing had destroyed 5,000,000 houses and apartments, and
12,000,000 refugees from the east had crowded in.[25]
Food production was only two-thirds of the pre-war level
in 194648, while normal grain and meat shipments no
longer arrived from the East. The drop in food production
can be attributed to a drought that killed a major portion of the wheat crop while a severe winter destroyed
the majority of the wheat crop the following year. This
caused most Europeans to rely on a 1,500 calorie per day
diet.[26] Furthermore, the large shipments of food stolen
from occupied nations during the war no longer reached
Germany. Industrial production fell more than half and
reached pre-war levels only at the end of 1949.[27]
While Germany struggled to recover from the destruction
of the War, the recovery eort began in June 1948, moving on from emergency relief. The currency reform in
1948 was headed by the military government and helped
Germany to restore stability by encouraging production.
The reform revalued old currency and deposits and introduced new currency. Taxes were also reduced and Germany prepared to remove economic barriers.[28]

The hunger-winter of 1947, thousands protest in West Germany

against the disastrous food situation (March 31, 1947). The sign
says: We want coal, we want bread

In January 1947, Truman appointed retired General

George Marshall as Secretary of State. In July 1947 Marshall scrapped Joint Chiefs of Sta Directive 1067 implemented as part of the Morgenthau Plan under the personal supervision of Roosevelts treasury secretary Henry
Morgenthau, Jr., which had decreed take no steps looking toward the economic rehabilitation of Germany [or]
designed to maintain or strengthen the German economy. Thereafter, JCS 1067 was supplanted by JCS 1779,
stating that an orderly and prosperous Europe requires
the economic contributions of a stable and productive
Germany.[33] The restrictions placed on German heavy
industry production were partly ameliorated; permitted
steel production levels were raised from 25% of prewar capacity to a new limit placed at 50% of pre-war

capacity.[34]

MARSHALLS SPEECH

accounting of the industrial plants, goods and infrastructure already removed by the Soviets in their occupied zone.[40][41] Molotov refrained from supplying accounts of Soviet assets.[42] The Soviets took a punitive approach, pressing for a delay rather than an acceleration in economic rehabilitation, demanding unconditional fulllment of all prior reparation claims, and
pressing for progress toward nationwide socioeconomic
transformation.[43]

With a Communist insurgency threatening Greece, and

Britain nancially unable to continue its aid, the President announced his Truman Doctrine on 12 March 1947,
to support free peoples who are resisting attempted subjugation by armed minorities or by outside pressures,
with an aid request for consideration and decision, concerning Greece and Turkey. Also in March 1947, former
US President Herbert Hoover, in one of his reports from
Germany, argued for a change in US occupation policy, After six weeks of negotiations, Molotov rejected all of
amongst other things stating:
the American and British proposals.[40][43] Molotov also
rejected the counter-oer to scrap the British-American
Bizonia and to include the Soviet zone within the newly
There is the illusion that the New Germany
constructed Germany.[43] Marshall was particularly disleft after the annexations can be reduced to a
couraged after personally meeting with Stalin to explain
'pastoral state' (Morgenthaus vision). It canthat the United States could not possibly abandon its ponot be done unless we exterminate or move
sition on Germany, while Stalin expressed little interest
[35]
25,000,000 people out of it.
in a solution to German economic problems.[40][43]
Hoover further noted that, The whole economy of Europe is interlinked with German economy through the
exchange of raw materials and manufactured goods.
The productivity of Europe cannot be restored without the restoration of Germany as a contributor to that
productivity.[36] Hoovers report led to a realization in
Washington that a new policy was needed; almost any
action would be an improvement on current policy.[37] In
Washington, the Joint Chiefs declared that the complete
revival of German industry, particularly coal mining was
now of primary importance to American security.[33]
The United States was already spending a great deal to
help Europe recover. Over $14 billion was spent or
loaned during the postwar period through the end of
1947, and is not counted as part of the Marshall Plan.
Much of this aid was designed to restore infrastructure
and help refugees. Britain, for example, received an
emergency loan of $3.75 billion.[38]
The United Nations also launched a series of humanitarian and relief eorts almost wholly funded by the United
States. These eorts had important eects, but they
lacked any central organization and planning, and failed
to meet many of Europes more fundamental needs.[39]
Already in 1943, the United Nations Relief and Rehabilitation Administration (UNRRA) was founded to provide
relief to areas liberated from Germany. UNRRA provided billions of dollars of rehabilitation aid, and helped
about 8 million refugees. It ceased operation of displaced
persons camps in Europe in 1947; many of its functions
were transferred to several UN agencies.

Soviet negotiations

After Marshalls appointment in January 1947, administration ocials met with Soviet Foreign Minister Vyacheslav Molotov and others to press for an economically self-sucient Germany, including a detailed

5 Marshalls speech
After the adjournment of the Moscow conference following six weeks of failed discussions with the Soviets regarding a potential German reconstruction, the
United States concluded that a solution could not wait any
longer.[40]
To clarify the USs position, a major address by Secretary
of State George Marshall was planned. Marshall gave
the address to the graduating class of Harvard University on June 5, 1947. Standing on the steps of Memorial
Church in Harvard Yard, he oered American aid to promote European recovery and reconstruction. The speech
described the dysfunction of the European economy and
presented a rationale for US aid.
The modern system of the division of labor upon which the exchange of products is
based is in danger of breaking down. ... Aside
from the demoralizing eect 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 to the world,
without which there can be no political stability and no assured peace. Our policy is not directed against any country, but against hunger,
poverty, desperation and chaos. Any government that is willing to assist in recovery will
nd full co-operation on the part of the USA.
Its purpose should be the revival of a working economy in the world so as to permit the
emergence of political and social conditions in
which free institutions can exist.

6.2

Compulsory Eastern Bloc rejection

Marshall was convinced that economic stability would

provide political stability in Europe. He oered aid,
but the European countries had to organize the program
themselves.

reportedfollowing his arrival in Paris in July 1947

that conditions for the credit were non-negotiable.[46]
Looming as just as large a concern was the Czechoslovak eagerness to accept the aid, as well as indications of
[46]
The speech, written by Charles Bohlen, contained virtu- a similar Polish attitude.
ally no details and no numbers. More a proposal than a Stalin suspected a possibility that these Eastern Bloc
plan, it was a challenge to European leaders to cooperate countries might defy Soviet directives not to accept the
and coordinate. It asked Europeans to create their own aid, potentially causing a loss of control of the Eastern
plan for rebuilding Europe, indicating the United States Bloc.[46] In addition, the most important condition was
would then fund this plan. The administration felt that the that every country choosing to take advantage of the plan
plan would likely be unpopular among many Americans, would need to have its economic situation independently
and the speech was mainly directed at a European audi- assesseda level of scrutiny to which the Soviets could
ence. In an attempt to keep the speech out of American not agree. Bevin and Bidault also insisted that any aid
papers journalists were not contacted, and on the same be accompanied by the creation of a unied European
day Truman called a press conference to take away head- economy, something incompatible with the strict Soviet
lines. In contrast, Dean Acheson, an Under Secretary of command economy.
State, was dispatched to contact the European media, especially the British media, and the speech was read in its
entirety on the BBC.[44][45]
6.2 Compulsory Eastern Bloc rejection

Rejection by the Soviets

Soviet Foreign Minister Vyacheslav Molotov left Paris,

rejecting the plan.[47] Thereafter, statements were made
suggesting a future confrontation with the West, calling
the United States both a fascizing power and the center
of worldwide reaction and anti-Soviet activity, with all
U.S.-aligned countries branded as enemies.[47] The Soviets also then blamed the United States for communist
losses in elections in Belgium, France and Italy months
earlier, in the spring of 1947.[47] It claimed that marshallization must be resisted and prevented by any means,
and that French and Italian communist parties were to
take maximum eorts to sabotage the implementation of
the Plan.[47] In addition, Western embassies in Moscow
were isolated, with their personnel being denied contact
with Soviet ocials.[47]

British Foreign Secretary Ernest Bevin heard Marshalls radio broadcast speech and immediately contacted
French Foreign Minister Georges Bidault to begin preparing a quick European response to (and acceptance of)
the oer, which led to the creation of the Committee of
European Economic Co-operation. The two agreed that
it would be necessary to invite the Soviets as the other
major allied power. Marshalls speech had explicitly included an invitation to the Soviets, feeling that excluding
them would have been a sign of distrust. State Department ocials, however, knew that Stalin would almost
certainly not participate, and that any plan that would
send large amounts of aid to the Soviets was unlikely to On July 12, a larger meeting was convened in Paris. Every country of Europe was invited, with the exceptions
be approved by Congress.
of Spain (a World War II neutral that had sympathized
with Axis powers) and the small states of Andorra, San
6.1 Initial reactions
Marino, Monaco, and Liechtenstein. The Soviet Union
was invited with the understanding that it would likely
While the Soviet ambassador in Washington suspected refuse. The states of the future Eastern Bloc were also
that the Marshall Plan could lead to the creation of an approached, and Czechoslovakia and Poland agreed to
anti-Soviet bloc, Stalin was open to the oer.[46] He di- attend. In one of the clearest signs of Soviet control
rected thatin negotiations to be held in Paris regarding over the region, the Czechoslovakian foreign minister,
the aidcountries in the Eastern Bloc should not reject Jan Masaryk, was summoned to Moscow and berated by
economic conditions being placed upon them.[46] Stalin Stalin for thinking of joining the Marshall Plan. Polonly changed his outlook when he learned that (a) credit ish Prime minister Jzef Cyrankiewicz was rewarded by
would only be extended under conditions of economic co- Stalin for the Polish rejection of the Plan. Russia reoperation and, (b) aid would also be extended to Germany warded Poland with a lucrative ve-year trade agreement,
in total, an eventuality which Stalin thought would ham- the equivalent of 450 million 1948 dollars ($4.4 billion in
per the Soviets ability to exercise inuence in western 2014 dollars[48] ) in credit, 200,000 tons of grain, heavy
machinery, and factories.[49]
Germany.[46]
Initially, Stalin maneuvered to kill the Plan, or at least
hamper it by means of destructive participation in the
Paris talks regarding conditions.[46] He quickly realized,
however, that this would be impossible after Molotov

The Marshall Plan participants were not surprised when

the Czechoslovakian and Polish delegations were prevented from attending the Paris meeting. The other
Eastern Bloc states immediately rejected the oer.[50]

NEGOTIATIONS

Finland also declined in order to avoid antagonizing the

Soviets (see also Finlandization). The Soviet Unions
alternative to the Marshall plan, which was purported
to involve Soviet subsidies and trade with western Europe, became known as the Molotov Plan, and later, the
COMECON. In a 1947 speech to the United Nations, Soviet deputy foreign minister Andrei Vyshinsky said that
the Marshall Plan violated the principles of the United
Nations. He accused the United States of attempting to
impose its will on other independent states, while at the
same time using economic resources distributed as relief
to needy nations as an instrument of political pressure.[51]

vakia had immediately rejected Marshall Plan aid, Eastern Bloc communist parties were blamed for permitting
even minor inuence by non-communists in their respective countries during the run up to the Marshall Plan.[57]
The meetings chair, Andrei Zhdanov, who was in permanent radio contact with the Kremlin from whom he
received instructions,[54] also castigated communist parties in France and Italy for collaboration with those countries domestic agendas.[58] Zhdanov warned that if they
continued to fail to maintain international contact with
Moscow to consult on all matters, extremely harmful
consequences for the development of the brother parties
work would result.[58]

6.3

Italian and French communist leaders were prevented

by party rules from pointing out that it was actually
Stalin who had directed them not to take opposition
stances in 1944.[58] The French communist party, as others, was then to redirect its mission to destroy capitalist economy and that the Soviet Communist Information Bureau (Cominform) would take control of the
French Communist Partys activities to oppose the Marshall Plan.[55] When they asked Zhdanov if they should
prepare for armed revolt when they returned home, he did
not answer.[55] In a follow-up conversation with Stalin,
he explained that an armed struggle would be impossible
and that the struggle against the Marshall Plan was to be
waged under the slogan of national independence.[59]

Yugoslavia

Although all other Communist European Countries had

deferred to Stalin and rejected the aid, the Yugoslavs, led
by Josip Broz (Tito), at rst went along and rejected the
Marshall plan. However, in 1948 Tito broke decisively
with Stalin on other issues, making Yugoslavia an independent communist state. Yugoslavia requested American aid. American leaders were internally divided, but
nally agreed and began sending money on a small scale
in 1949, and on a much larger scale in 1950-53. The
American aid was not part of the Marshall plan.[52]

6.4

Szklarska Porba meeting

In late September, the Soviet Union called a meeting of nine European Communist parties in southwest
Poland.[53] A Communist Party of the Soviet Union
(CPSU) report was read at the outset to set the heavily
anti-Western tone, stating now that international politics
is dominated by the ruling clique of the American imperialists which have embarked upon the enslavement of
the weakened capitalist countries of Europe.[54] Communist parties were to struggle against the U.S. presence
in Europe by any means necessary, including sabotage.[55]
The report further claimed that reactionary imperialist
elements throughout the world, particularly in the U.S.A.,
in Britain and France, had put particular hope on Germany and Japan, primarily on Hitlerite Germanyrst
as a force most capable of striking a blow at the Soviet
Union.[56]

7 Negotiations

Turning the plan into reality required negotiations among

the participating nations, and to get the plan through the
United States Congress. Sixteen nations met in Paris to
determine what form the American aid would take, and
how it would be divided. The negotiations were long
and complex, with each nation having its own interests.
Frances major concern was that Germany not be rebuilt
to its previous threatening power. The Benelux countries
(Belgium, Netherlands and Luxemburg), despite also suffering under the Nazis, had long been closely linked to the
German economy and felt their prosperity depended on
its revival. The Scandinavian nations, especially Sweden,
insisted that their long-standing trading relationships with
the Eastern bloc nations not be disrupted and that their
Referring to the Eastern Bloc, the report stated that the neutrality not be infringed.[60]
Red Armys liberating role was complemented by an up- The United Kingdom insisted on special status as a longsurge of the freedom-loving peoples liberation struggle standing belligerent during the war, concerned that if
against the fascist predators and their hirelings.[56] It ar- it were treated equally with the devastated continental
gued that the bosses of Wall Street were tak[ing] the powers it would receive virtually no aid. The Ameriplace of Germany, Japan and Italy.[56] The Marshall cans were pushing the importance of free trade and EuPlan was described as the American plan for the enslave- ropean unity to form a bulwark against communism. The
ment of Europe.[56] It described the world now breaking Truman administration, represented by William L. Claydown into basically two campsthe imperialist and an- ton, promised the Europeans that they would be free to
tidemocratic camp on the one hand, and the antiimperi- structure the plan themselves, but the administration also
alist and democratic camp on the other.[56]
reminded the Europeans that implementation depended
Although the Eastern Bloc countries except Czechoslo- on the plans passage through Congress. A majority of

7
Congress members were committed to free trade and European integration, and were hesitant to spend too much
of the money on Germany.[60] However, before the Marshall Plan was in eect, France, Austria, and Italy needed
immediate aid. On December 17, 1947, the United States
agreed to give $40 million to France, Austria, China, and
Italy.[61]

gram. ECA was headed by economic cooperation administrator Paul G. Homan. In the same year, the participating countries (Austria, Belgium, Denmark, France,
West Germany, the United Kingdom, Greece, Iceland,
Ireland, Italy, Luxembourg, the Netherlands, Norway,
Sweden, Switzerland, Turkey, and the United States)
signed an accord establishing a master nancial-aidAgreement was eventually reached and the Europeans coordinating agency, the Organization for European Economic Cooperation (later called the Organization for
sent a reconstruction plan to Washington, which was formulated and agree upon by the Committee of European Economic Cooperation and Development or OECD),
which was headed by Frenchman Robert Marjolin.
Economic Co-operation in 1947. In the document the
Europeans asked for $22 billion in aid. Truman cut this
to $17 billion in the bill he put to Congress. The plan
encountered sharp opposition in Congress, mostly from 8 Implementation
the portion of the Republican Party led by Robert A. Taft
that advocated a more isolationist policy and was weary of
massive government spending. The plan also had opponents on the left, Henry A. Wallace notably among them.
Wallace saw the plan as a subsidy for American exporters
and sure to polarize the world between East and West.[62]
Wallace, the former vice president and secretary of agriculture, mockingly called this the Martial Plan, arguing
that it was just another step towards war.[63] However, opposition against the Marshall Plan was greatly reduced by
the shock of the Communist coup in Czechoslovakia in
February 1948. Soon after, a bill granting an initial $5
billion passed Congress with strong bipartisan support.
Congress would eventually allocate $12.4 billion in aid
over the four years of the plan.[64]
On March 17, 1948, President Harry S. Truman addressed European security and condemned the Soviet Union before a hastily convened Joint Session of
Congress. Attempting to contain spreading Soviet inuence in Eastern Bloc, Truman asked Congress to restore
a peacetime military draft and to swiftly pass the Economic Cooperation Act, the name given to the Marshall
Plan. Of the Soviet Union Truman said, The situation
in the world today is not primarily the result of the natural diculties which follow a great war. It is chiey due
to the fact that one nation has not only refused to cooperate in the establishment of a just and honorable peace
buteven worsehas actively sought to prevent it.[65]
Members of the Republican-controlled 80th Congress
(19471949) were skeptical. In eect, he told the Nation that we have lost the peace, that our whole war eort
was in vain., noted Representative Frederick Smith of
Ohio. Others thought he had not been forceful enough to
contain the USSR. What [Truman] said fell short of being tough, noted Representative Eugene Cox, a Democrat from Georgia, there is no prospect of ever winning
Russian cooperation. Despite its reservations, the 80th
Congress implemented Trumans requests, further escalating the Cold War with the USSR.[65]

First page of the Marshall Plan

The rst substantial aid went to Greece and Turkey in January 1947, which were seen as the front line of the battle
against communist expansion, and were already receiving aid under the Truman Doctrine. Initially, Britain had
supported the anti-communist factions in those countries,
but due to its dire economic condition it decided to pull
out and in February 1947 requested the U.S. to continue
its eorts.[66] The ECA formally began operation in July
1948.

The ECAs ocial mission statement was to give a boost

Truman signed the Economic Cooperation Act into law
to the European economy: to promote European producon April 3, 1948; the Act established the Economic Cotion, to bolster European currency, and to facilitate interoperation Administration (ECA) to administer the pronational trade, especially with the United States, whose

8
economic interest required Europe to become wealthy
enough to import U.S. goods. Another unocial goal of
ECA (and of the Marshall Plan) was the containment of
growing Soviet inuence in Europe, evident especially in
the growing strength of communist parties in Czechoslovakia, France, and Italy.

8 IMPLEMENTATION
using them to reduce the budget decit. In France, and
most other countries, the counterpart fund money was absorbed into general government revenues, and not recycled as in Germany.

The Marshall Plan money was transferred to the govern- 8.1

ments of the European nations. The funds were jointly
administered by the local governments and the ECA.
Each European capital had an ECA envoy, generally a
prominent American businessman, who would advise on
the process. The cooperative allocation of funds was encouraged, and panels of government, business, and labor
leaders were convened to examine the economy and see
where aid was needed.

Technical Assistance Program

The Marshall Plan aid was mostly used for the purchase
of goods from the United States. The European nations
had all but exhausted their foreign exchange reserves during the war, and the Marshall Plan aid represented almost their sole means of importing goods from abroad.
At the start of the plan these imports were mainly muchneeded staples such as food and fuel, but later the purchases turned towards reconstruction needs as was originally intended. In the latter years, under pressure from
the United States Congress and with the outbreak of the
Korean War, an increasing amount of the aid was spent on
rebuilding the militaries of Western Europe. Of the some
$13 billion allotted by mid-1951, $3.4 billion had been
spent on imports of raw materials and semi-manufactured Construction in West Berlin with the help of the Marshall Plan
products; $3.2 billion on food, feed, and fertilizer; $1.9 after 1948. On the plaque read: Emergency Program Berlin with the help of the Marshall Plan
billion on machines, vehicles, and equipment; and $1.6
[67]
billion on fuel.
Also established were counterpart funds, which used
Marshall Plan aid to establish funds in the local currency. According to ECA rules 60% of these funds
had to be invested in industry. This was prominent in
Germany, where these government-administered funds
played a crucial role in lending money to private enterprises which would spend the money rebuilding. These
funds played a central role in the reindustrialization of
Germany. In 194950, for instance, 40% of the investment in the German coal industry was by these funds.[68]
The companies were obligated to repay the loans to the
government, and the money would then be lent out to another group of businesses. This process has continued
to this day in the guise of the state owned KfW bank,
(Kreditanstalt fr Wiederaufbau, meaning Reconstruction Credit Institute). The Special Fund, then supervised
by the Federal Economics Ministry, was worth over DM
10 billion in 1971. In 1997 it was worth DM 23 billion.
Through the revolving loan system, the Fund had by the
end of 1995 made low-interest loans to German citizens
amounting to around DM 140 billion. The other 40%
of the counterpart funds were used to pay down the debt,
stabilize the currency, or invest in non-industrial projects.
France made the most extensive use of counterpart funds,

US aid to Greece under the Marshall Plan

The US Bureau of Labor Statistics (BLS) contributed

heavily to the success of the Technical Assistance Program. The United States Congress passed a law on June
7, 1940 that allowed the BLS to make continuing studies of labor productivity[69] and appropriated funds for

8.2

German level of industry restrictions

the creation of a Productivity and Technological Development Division. The BLS could then use its expertise in
the eld of productive eciency to implement a productivity drive in each Western European country receiving
Marshall Plan aid.
By implementing technological literature surveys and organized plant visits, American economists, statisticians,
and engineers were able to educate European manufacturers in statistical measurement. The goal of the statistical and technical assistance from the Americans was to
increase productive eciency of European manufacturers in all industries.
In order to perform this analysis, the BLS performed two
types of productivity calculations. First, they used existing data to calculate how much a worker produces per
hour of workthe average output rate. Second, they
compared the existing output rates in a particular country to output rates in other nations. By performing these
calculations across all industries, the BLS was able to
identify the strengths and weaknesses of each countrys
manufacturing and industrial production. From that, the
BLS could recommend technologies (especially statistical) that each individual nation could implement. Often,
these technologies came from the United States; by the
time the Technical Assistance Program began, the United
States used statistical technologies more than a generation ahead of what [the Europeans] were using.[69]

9
ductivity standards) can and should be implemented
to increase productivity;
3. that there should be a general exchange and publication of information; and
4. that the technical abstract service should be the
central source of information.[71]
The eects of the Technical Assistance Program were not
limited to improvements in productive eciency. While
the thousands of European leaders took their work/study
trips to the United States, they were able to observe a
number of aspects of American society as well. The
Europeans could watch local, state, and federal governments work together with citizens in a pluralist society.
They observed a democratic society with open universities and civic societies in addition to more advanced factories and manufacturing plants. The Technical Assistance Program allowed Europeans to bring home many
types of American ideas.[72]
Another important aspect of the Technical Assistance
Program was its low cost. While $19.4 billion was allocated for capital costs in the Marshall Plan, the Technical Assistance Program only required $300 million. Only
one-third of that $300 million cost was paid by the United
States.[71]

The BLS used these statistical technologies to create Factory Performance Reports for Western European nations.
The American government sent hundreds of technical advisors to Europe in order to observe workers in the eld;
this on-site analysis made the Factory Performance Reports especially helpful to the manufacturers. In addition,
the Technical Assistance Program funded 24,000 European engineers, leaders, and industrialists to visit America and tour Americas factories, mines, and manufacturing plants.[70] This way, the European visitors would
be able to return to their home countries and implement
the technologies used in the United States. The analyses
in the Factory Performance Reports and the hands-on
experience had by the European productivity teams effectively identied productivity deciencies in European
industries; from there, it became clearer how to make European production more eective.
Before the Technical Assistance Program even went into
eect, Maurice Tobin (the United States Secretary of
Labor) expressed his condence in American productivity and technology to both American and European eco- 1960 West German stamp honoring George Marshall
nomic leaders. He urged that the United States play a
large role in improving European productive eciency
by providing four recommendations for the programs ad8.2 German level of industry restrictions
ministrators:
1. That BLS productivity personnel should serve on Even while the Marshall Plan was being implemented,
the dismantling of ostensibly German industry continued;
American-European councils for productivity;
and in 1949 Konrad Adenauer wrote to the Allies request2. that productivity targets (based on American pro- ing the end of industrial dismantling, citing the inher-

10

11 EFFECTS AND LEGACY

ent contradiction between encouraging industrial growth

and removing factories, and also the unpopularity of the
policy.[73] Support for dismantling was by this time coming predominantly from the French, and the Petersberg
Agreement of November 1949 greatly reduced the levels
of deindustrialization, though dismantling of minor factories continued until 1951.[74] The rst level of industry plan, signed by the Allies on March 29, 1946, had
stated that German heavy industry was to be lowered to
50% of its 1938 levels by the destruction of 1,500 listed
manufacturing plants.[75]
In January 1946 the Allied Control Council set the foundation of the future German economy by putting a cap on
German steel production. The maximum allowed was set
at about 5,800,000 tons of steel a year, equivalent to 25%
of the pre-war production level.[76] The UK, in whose occupation zone most of the steel production was located,
had argued for a more limited capacity reduction by placing the production ceiling at 12 million tons of steel per
year, but had to submit to the will of the U.S., France
and the Soviet Union (which had argued for a 3 million
ton limit). Steel plants thus made redundant were to be
dismantled. Germany was to be reduced to the standard
of life it had known at the height of the Great Depression (1932).[77] Consequently, car production was set to
10% of pre-war levels, and the manufacture of other commodities was reduced as well.[78]
The rst "German level of industry" plan was subsequently followed by a number of new ones, the last signed
in 1949. By 1950, after the virtual completion of the
by then much watered-down level of industry plans,
equipment had been removed from 706 manufacturing
plants in western Germany and steel production capacity
had been reduced by 6,700,000 tons.[79] Vladimir Petrov
concludes that the Allies delayed by several years the
economic reconstruction of the war-torn continent, a reconstruction which subsequently cost the United States
billions of dollars.[80] In 1951 West Germany agreed to
join the European Coal and Steel Community (ECSC)
the following year. This meant that some of the economic
restrictions on production capacity and on actual production that were imposed by the International Authority for
the Ruhr were lifted, and that its role was taken over by
the ECSC.[81]

Expenditures

sis than the second highest recipient.[82] The table below

shows Marshall Plan aid by country and year (in millions
of dollars) from The Marshall Plan Fifty Years Later.[83]
There is no clear consensus on exact amounts, as dierent scholars dier on exactly what elements of American
aid during this period were part of the Marshall Plan.

10 Loans and grants

The Marshall plan, just as GARIOA, consisted of aid
both in the form of grants and in the form of loans.[84]
Out of the total, 1.2 billion USD were loan-aid.[85]
Ireland which received 146.2 million USD through the
Marshall plan, received 128.2 million USD as loans, and
the remaining 18 million USD as grants.[86] By 1969 the
Irish Marshall plan debt, which was still being repaid,
amounted to 31 million pounds, out of a total Irish foreign
debt of 50 million pounds.[87]
The UK received 385 million USD of its Marshall plan
aid in the form of loans.[85] Unconnected to the Marshall plan the UK also received direct loans from the US
amounting to 4.6 billion USD.[85] The proportion of Marshall plan loans versus Marshall plan grants was roughly
15% to 85% for both the UK and France.[88]
Germany, which up until the 1953 Debt agreement had to
work on the assumption that all the Marshall plan aid was
to be repaid, spent its funds very carefully. Payment for
Marshall plan goods, counterpart funds, were administered by the Reconstruction Credit Institute, which used
the funds for loans inside Germany. In the 1953 Debt
agreement the amount of Marshall plan aid that Germany
was to repay was reduced to less than 1 billion USD.[89]
This made the proportion of loans versus grants to Germany similar to that of France and the UK.[88] The nal German loan repayment was made in 1971.[90] Since
Germany chose to repay the aid debt out of the German
Federal budget, leaving the German ERP fund intact, the
fund was able to continue its reconstruction work. By
1996 it had accumulated a value of 23 billion Deutsche
Mark.[91]

11 Eects and legacy

The Marshall Plan was originally scheduled to end in
1953. Any eort to extend it was halted by the growing cost of the Korean War and rearmament. American
Republicans hostile to the plan had also gained seats in
the 1950 Congressional elections, and conservative opposition to the plan was revived. Thus the plan ended
in 1951, though various other forms of American aid to
Europe continued afterwards.

The Marshall Plan aid was divided amongst the participant states on a roughly per capita basis. A larger amount
was given to the major industrial powers, as the prevailing opinion was that their resuscitation was essential for
general European revival. Somewhat more aid per capita
was also directed towards the Allied nations, with less for
those that had been part of the Axis or remained neu- The years 1948 to 1952 saw the fastest period of growth
tral. The exception was Iceland, which had been neutral in European history. Industrial production increased by
during the war, but received far more on a per capita ba- 35%. Agricultural production substantially surpassed

11
that would persist throughout the Cold War. At the same
time, the nonparticipation of the states of the Eastern
Bloc was one of the rst clear signs that the continent was
now divided.
The Marshall Plan also played an important role in European integration. Both the Americans and many of the
European leaders felt that European integration was necessary to secure the peace and prosperity of Europe, and
thus used Marshall Plan guidelines to foster integration.
In some ways this eort failed, as the OEEC never grew to
be more than an agent of economic cooperation. Rather
it was the separate European Coal and Steel Community, which notably excluded Britain, that would eventually grow into the European Union. However, the OEEC
served as both a testing and training ground for the structures that would later be used by the European Economic
Community. The Marshall Plan, linked into the Bretton
Woods system, also mandated free trade throughout the
region.
While some historians today feel some of the praise for
the Marshall Plan is exaggerated, it is still viewed favorably and many thus feel that a similar project would help
other areas of the world. After the fall of communism
several proposed a Marshall Plan for Eastern Europe
One of a number of posters created to promote the Marshall Plan that would help revive that region. Others have proposed
in Europe. Note the pivotal position of the American ag. The a Marshall Plan for Africa to help that continent, and
blue and white ag between those of Germany and Italy is a U.S. vice president Al Gore suggested a Global Marshall
version of the Trieste ag with the UN blue rather than the tra- Plan.[94] Marshall Plan has become a metaphor for any
ditional red.
very large scale government program that is designed to
solve a specic social problem. It is usually used when
calling for federal spending to correct a perceived failure
[64]
pre-war levels.
The poverty and starvation of the im- of the private sector.
mediate postwar years disappeared, and Western Europe
embarked upon an unprecedented two decades of growth
that saw standards of living increase dramatically. There
is some debate among historians over how much this 12 Repayment
should be credited to the Marshall Plan. Most reject the
idea that it alone miraculously revived Europe, as evi- The Organization for European Economic Cooperation
dence shows that a general recovery was already under- took the leading role in allocating funds, and the OEEC
way. Most believe that the Marshall Plan sped this recov- arranged for the transfer of the goods. The American
ery, but did not initiate it. Many argue that the structural supplier was paid in dollars, which were credited against
adjustments that it forced were of great importance. Eco- the appropriate European Recovery Program funds. The
nomic historians J. Bradford DeLong and Barry Eichen- European recipient, however, was not given the goods as
green call it historys most successful structural adjust- a gift, but had to pay for them (usually on credit) in loment program.[92] One eect of the plan was that it cal currency. These payments were kept by the European
subtly Americanized countries, especially Austria, who government involved in a special counterpart fund. This
embraced United States assistance, through popular cul- counterpart money, in turn, could be used by the governture, such as Hollywood movies and rock n' roll.[93]
ment for further investment projects. 5% of the counterThe political eects of the Marshall Plan may have been part money was paid to the U.S. to cover the administrawas in
just as important as the economic ones. Marshall Plan aid tive costs of the ERP. The Marshall Plan money
[95]
In adthe
form
of
grants
that
did
not
have
to
be
repaid.
allowed the nations of Western Europe to relax austerity
Export-Import
Bank
(an
agency
dition
to
ERP
grants,
the
measures and rationing, reducing discontent and bringing political stability. The communist inuence on West- of the U.S. government) at the same time made long-term
ern Europe was greatly reduced, and throughout the re- loans at low interest rates to nance major purchases in
gion communist parties faded in popularity in the years the US, all of which were repaid.
after the Marshall Plan. The trade relations fostered by In the case of Germany there also were 16 billion marks
the Marshall Plan helped forge the North Atlantic alliance of debts from the 1920s which had defaulted in the 1930s,

12

14 CRITICISM

but which Germany decided to repay to restore its reputation. This money was owed to government and private banks in the U.S., France and Britain. Another 16
billion marks represented postwar loans by the U.S. Under the London Debts Agreement of 1953, the repayable
amount was reduced by 50% to about 15 billion marks
and stretched out over 30 years, and compared to the fastgrowing German economy were of minor impact.[96]

provided machinery, equipment, agricultural goods, industrial goods, and consumer goods to the Soviet Union.
Economic recovery in the east was much slower than
in the west, and the economies never fully recovered in
the communist period, resulting in the formation of the
shortage economies and a gap in wealth between East and
West. Finland, which USSR forbade to join the Marshall Plan and which was required to give large reparations to the USSR, saw its economy recover to pre-war
levels in 1947.[102] France, which received billions of dollars through the Marshall Plan, similarly saw its aver13 Areas without the Plan
age income per person return to almost pre-war level by
1949.[103] By mid-1948 industrial production in Poland,
had recovered to
Large parts of the world devastated by World War II did Hungary, Bulgaria, and Czechoslovakia
[104]
a
level
somewhat
above
pre-war
level.
not benet from the Marshall Plan. The only major Western European nation excluded was Francisco Franco's
Spain, which did not overtly participate in World War
II. After the war, it pursued a policy of self-suciency, 13.1 Aid to Asia
currency controls, and quotas, with little success. With
the escalation of the Cold War, the United States recon- From the end of the war to the end of 1953, the U.S.
sidered its position, and in 1951 embraced Spain as an provided grants and credits amounting to $5.9 billion
ally, encouraged by Francos aggressive anti-communist to Asian countries, especially China/Taiwan ($1.051 bilpolicies. Over the next decade, a considerable amount of lion), India ($255 million), Indonesia ($215 million),
American aid would go to Spain, but less than its neigh- Japan ($2.44 billion), South Korea ($894 million), Pakistan ($98 million) and the Philippines ($803 million).
bors had received under the Marshall Plan.[97]
In addition, another $282 million went to Israel and $196
While the western portion of the Soviet Union had been million to the rest of the Middle East.[105] All this aid was
as badly aected as any part of the world by the war, separate from the Marshall Plan.
the eastern portion of the country was largely untouched
and had seen a rapid industrialization during the war.
The Soviets also imposed large reparations payments 13.2 Canada
on the Axis allies that were in its sphere of inuence.
Austria, Finland, Hungary, Romania, and especially East Canada, like the United States, was little damaged by the
Germany were forced to pay vast sums and ship large war and in 1945 was one of the worlds largest economies.
amounts of supplies to the USSR. These reparation pay- It operated its own aid program. In 1948, the U.S. alments meant the Soviet Union itself received about the lowed ERP aid to be used in purchasing goods from
same as 16 European countries received in total from Canada. Canada made over a billion dollars in sales in
Marshall Plan aid.[98]
the rst two years of operation.[106]
In accordance with the agreements with the USSR shipment of dismantled German industrial installations from
the west began on March 31, 1946. Under the terms of
the agreement the Soviet Union would in return ship raw
materials such as food and timber to the western zones.
In view of the Soviet failure to do so, the western zones
halted the shipments east, ostensibly on a temporary basis, although they were never resumed. It was later shown
that the main reason for halting shipments east was not the
behavior of the USSR but rather the recalcitrant behavior
of France.[99] Examples of material received by the USSR
were equipment from the Kugel-Fischer ballbearing plant
at Schweinfurt, the Daimler-Benz underground aircraftengine plant at Obrigheim, the Deschimag shipyards at
Bremen-Weser, and the Gendorf powerplant.[100][101]
The USSR did establish COMECON as a riposte to the
Marshall Plan to deliver aid for Eastern Bloc countries,
but this was complicated by the Soviet eorts to manage their own recovery from the war. The members of
Comecon looked to the Soviet Union for oil; in turn, they

13.3 World total

The total of American grants and loans to the world from
1945 to 1953 came to $44.3 billion.[107]

14 Criticism
14.1 Laissez-faire criticism
Initial criticism of the Marshall Plan came from a number
of economists. Wilhelm Rpke, who inuenced German
Minister for Economy Ludwig Erhard in his economic
recovery program, believed recovery would be found in
eliminating central planning and restoring a market economy in Europe, especially in those countries which had
adopted more fascist and corporatist economic policies.
Rpke criticized the Marshall Plan for forestalling the

13
transition to the free market by subsidizing the current,
failing systems. Erhard put Rpkes theory into practice
and would later credit Rpkes inuence for West Germanys preeminent success.[108]
Henry Hazlitt criticized the Marshall Plan in his 1947
book Will Dollars Save the World?, arguing that economic recovery comes through savings, capital accumulation and private enterprise, and not through large cash
subsidies. Ludwig von Mises criticized the Marshall Plan
in 1951, believing that the American subsidies make it
possible for [Europes] governments to conceal partially
the disastrous eects of the various socialist measures
they have adopted.[109] Some critics and Congressmen at
the time believed that America was giving too much aid
to Europe. America had already given Europe $9 billion
in other forms of help in previous years. The Marshall
Plan gave another $13 billion, equivalent to about $100
billion in 2010 value.[110]
The Postwar Period coin

14.2

Modern criticism

The Marshall Plan was said to have set the stage for large
amounts of private U.S. investment in Europe, establishing the basis for modern transnational corporations".[113]
The Netherlands received U.S. aid for economic recovery
in the Netherlands Indies. However, in January 1949, the
American government suspended this aid in response to
the Dutch eorts to restore colonial rule in Indonesia during the Indonesian National Revolution, and it implicitly
threatened to suspend Marshall aid to the Netherlands if
the Dutch government continued to oppose the independence of Indonesia.[114]

Criticism of the Marshall Plan became prominent among

historians of the revisionist school, such as Walter
LaFeber, during the 1960s and 1970s. They argued that
the plan was American economic imperialism, and that it
was an attempt to gain control over Western Europe just
as the Soviets controlled the Eastern Bloc. In a review of
West Germanys economy from 1945 to 1951, German
analyst Werner Abelshauser concluded that foreign aid
was not crucial in starting the recovery or in keeping it
going. The economic recoveries of France, Italy, and
Belgium, Cowen found, also predated the ow of U.S.
aid. Belgium, the country that relied earliest and most
heavily on free market economic policies after its liberation in 1944, experienced swift recovery and avoided the 15 In popular culture
severe housing and food shortages seen in the rest of continental Europe.[111]
Alfred Friendly, press aide to the US Secretary of Commerce
W. Averell Harriman, wrote a humorous operetta
Former US Chairman of the Federal Reserve Bank Alan
about
the
Marshall Plan during its rst year; one of the
Greenspan gives most credit to Ludwig Erhard for Eulines
in
the
operetta was: Wines for Sale; will you swap
ropes economic recovery. Greenspan writes in his mem/
A
little
bit
of steel for Chateau Neuf du Pape?"[115]
oir The Age of Turbulence that Erhards economic policies were the most important aspect of postwar Western The Spanish comedy lm Welcome Mr. Marshall! tells
Europe recovery, even outweighing the contributions of the story of a small Spanish town, Villar del Ro, which
the Marshall Plan. He states that it was Erhards reduc- hears of the visit of American diplomats and begins
tions in economic regulations that permitted Germanys preparations to impress the American visitors in the
miraculous recovery, and that these policies also con- hopes of benetting under the Marshall Plan.
tributed to the recoveries of many other European countries. Its recovery is attributed to traditional economic
stimuli, such as increases in investment, fueled by a high
savings rate and low taxes. Japan saw a large infusion of 16 See also
US investment during the Korean War.[112]
Noam Chomsky wrote that the amount of American dollars given to France and the Netherlands equaled the
funds these countries used to nance their military actions against their colonial subjects in East Asia, in French
Indochina and the Netherlands East Indies respectively.

German reparations for World War II

GITP (example of a company that is built with Marshall aid)

14

17

17 NOTES

Notes

[1] Milestones: 19451952 - Oce of the Historian. history.state.gov. Retrieved 2016-06-06.

[2] Hogan (1987)
[3] Anthony Carew, Labour under the Marshall Plan: the politics of productivity and the marketing of management science (Manchester University Press, 1987)
[4] The Marshall Plan Fifty Years Later (Palgrave MacMillan,
2001) ISBN 9780333929834
[5] Brookings Institution. Brookingss Role in the Marshall
Plan. brookings.edu.
[6] Marshallfoundation.org
[7] Brad Roberts, ed. (1990). The New Democracies: Global
Change and U.S. Policy. MIT Press. p. 97. ISBN
9780262680622.
[8] Georey Roberts (December 2000). Historians and the
Cold War. History Today. Retrieved 2009-02-15.
[9] Robert J. McMahon (2003-03-27). The Cold War. Very
Short Introductions. Oxford University Press. p. 30.
[10] Volkogonov, Dmitri. Stalin: Triumph and Tragedy. Forum, 1996, p.531.
[11] Kaplan, Jacob J. 1999. Interviewed by: W. Haven
North. 22 March. Arlington, VA: Association for Diplomatic Studies and Training, Foreign Aairs Oral History
Project, Foreign Assistance Series, p. 4. Adst.org
[12] Ination Calculator reecting value of $13 billion in 2013
Usinationcalculator.com
[13] Milward (1984) p. 46
[14] Mills, Nicolaus (2008). Winning the Peace: the Marshall
Plan and Americas Coming of Age as a Superpower. Wiley. p. 195. ISBN 978-0-470-09755-7.
[15] Hogan (1987) pp. 42745; Barry Eichengreen, The European Economy since 1945: Coordinated Capitalism and
Beyond, (2008) pp. 6473
[16] Barry Eichengreen, The European Economy since 1945:
Coordinated Capitalism and Beyond, (2008) p. 57; West
Germany was 6% higher, the other countries 45% higher.

[23] James T. Patterson (1997). Grand expectations: the

United States, 1945-1974. Oxford University Press. ISBN
0-19-507680-X.
[24] Michael J. Hogan, The Marshall Plan, p. 30.
[25] Deither Ra, A History of Germany (1988) p. 335
[26] Marta Scha, Marshall Plan p.1
[27] Alan S. Milward, The Reconstruction of Western Europe:
194551 (1984) pp. 356, 436
[28] Price, Harry Bayard (1955). The Marshall Plan and Its
Meaning. Ithaca, New York: Cornell University Press. p.
264.
[29] Nicholas Balabkins, Germany Under Direct Controls:
Economic Aspects of Industrial Disarmament 19451948,
Rutgers University Press, 1964 p. 207
[30] Balabkins, p. 209
[31] Pas de Pagaille! Time 28 July 1947.
[32] Gaddis, We Now Know.
[33] Beschloss 2003, p. 277
[34] Pas de Pagaille! Time, Jul. 28, 1947.
[35] Erik Reinert, Jomo K. S. The Marshall Plan at 60: The
Generals Successful War on Poverty, UN Chronicle (accessed 2008-05-20)
[36] Michael Wala, The Council on Foreign Relations and
American Foreign Policy in the Early Cold War, 1994,
Berghahn Books, ISBN 1-57181-003-X pp. 104105
[37] Michael J. Hogan The Marshall Plan: America, Britain,
and the Reconstruction of Western Europe, 19471952,
1987, Cambridge University, ISBN 0-521-37840-0 pp.
3435
[38] Statistical Abstract of the United States: 1949 p. 846 online
[39] Tony Judt, in The Marshall Plan: Fifty Years After, edited
by Martin Schain, p. 4.
[40] Miller 2000, p. 16
[41] Wettig 2008, p. 116
[42] Bookmarkable
URL
intermediate
eds.b.ebscohost.com. Retrieved 2016-03-21.

page.

[17] Quoted in Hogan (1987) p. 189

[18] Milward (1984) p. 466
[19] Herman Van der Wee, Prosperity and Upheaval: The
World Economy, 19451980 (1984) p. 44

[43] Wettig 2008, p. 117

[44] Charles L. Mee, (1984). The Marshall Plan. New York:
Simon & Schuster. p. 99. ISBN 0-671-42149-2.

[20] Tom Buchanan, Europes Troubled Peace 19452000,

(2006) ch 1

[45] BBC Correspondent Leonard Miall and the Marshall

Plan Speech: An Interview. The Marshall Foundation.
September 19, 1977. Retrieved 2007-08-15.

[21] Allen J. Matusow, Farm Policies and Politics in the Truman Administration (1967) pp 35-36.

[46] Wettig 2008, p. 138

[22] Tony Judt, Postwar: a History of Europe since 1945

(2005) ch 1

[47] Wettig 2008, p. 139

[48] US Ination Calculator

15

[49] Carnations TIME. TIME. 1948-02-09. Retrieved

2009-02-01.
[50] Schain, p.132

[73] Dennis L. Bark and David R. Gress. A history of West

Germany vol 1: from shadow to substance (Oxford 1989)
p259

[51] Vyshinsky Speech to U.N. General Assembly. Temple

University. Retrieved 2009-03-03.

[74] Dennis L. Bark and David R. Gress. A history of West

Germany vol 1: from shadow to substance (Oxford 1989)
p260

[52] John R. Lampe; et al. (1990). Yugoslav-American Economic Relations Since World War II. Duke University
Press. pp. 2837.

[75] Henry C. Wallich. Mainsprings of the German Revival

(1955) pg. 348.

[53] Behrman, Greg. Most noble adventure the Marshall plan

and the time when America helped save Europe. New
York: Free P, 2007.
[54] Wettig 2008, p. 140
[55] Wettig 2008, p. 146
[56] Wettig 2008, p. 142
[57] Wettig 2008, p. 148
[58] Wettig 2008, p. 145
[59] Wettig 2008, p. 147
[60] Cini, p.24 in Schain
[61] Sorel, Eliot, and Pier Carlo Padoan. The Marshall Plan:
Lessons Learned for the 21st Century. Paris: OECD,
2008. 15-16. Print.
[62] Hogan, p.93.
[63] Nash, Gary B., and Julie Roy. Jerey. Chills and Fever
During the Cold War, 19451960. The American People: Creating a Nation and a Society. 6th ed. New York:
Pearson Longman, 2008. 828.
[64] Grogin, p.118
[65] President Harry S. Trumans March 17, 1948 address to a
Joint Session. Clerk.house.gov. Archived from the original on September 5, 2011. Retrieved 2011-12-09.
[66] Alan Bullock, Ernest Bevin: Foreign Secretary (1983) pp
368-9; Arnold Oner, Another Such Victory (2002) p 197;
Denise M. Bostdor, Proclaiming the Truman Doctrine
(2008) p 51
[67] Hogan, p.415
[68] Crafts, Toniolo, p.464
[69] Wasser, Solidelle; Dolfman, Michael (2005). BLS and
the Marshall Plan: the forgotten story. Monthly Labor
Review: 44.
[70] Johnson, Gordon (2002). Lessons for Today from the
Marshall Plan. CIPE.ORG Feature Service: Technical Paper Series: 2.
[71] Wasser, Solidelle; Dolfman, Michael (2005). BLS and
the Marshall Plan: the forgotten story. Monthly Labor
Review: 49.
[72] Johnson, Gordon (2002). Lessons for Today from the
Marshall Plan. CIPE.ORG Feature Service: Technical Paper Series: 23.

[76] Cornerstone of Steel, TIME, January 21, 1946

[77] Cost of Defeat, TIME, April 8, 1946
[78] The Presidents Economic Mission to Germany and Austria, Report 3 Herbert Hoover, March, 1947 pg. 8
[79] Frederick H. Gareau Morgenthaus Plan for Industrial
Disarmament in Germany The Western Political Quarterly, Vol. 14, No. 2 (Jun., 1961), pp. 517-534
[80] Vladimir Petrov, Money and conquest; allied occupation
currencies in World War II. Baltimore, Johns Hopkins
Press (1967) p. 263
[81] Information bulletin Frankfurt, Germany: Oce of the
US High Commissioner for Germany Oce of Public Affairs, Public Relations Division, APO 757, US Army, January 1952 Plans for terminating international authority
for the Ruhr , pp. 61-62 (main URL)
[82] Jonsson, Gumundur; Snvarr, Sigurur (2008). Icelands Response to European Economic Integration.
Pathbreakers: Small European Countries Responding to
Globalisation and Deglobalisation. Peter Lang. p. 385.
[83] The Marshall Plan Fifty Years Later, Palgrave MacMillan,
United Kingdom, 2001 ISBN 9780333929834
[84] Timothy W. Guinnane, FINANCIAL VERGANGENHEITSBEWLTIGUNG: THE 1953 LONDON DEBT
AGREEMENT, p.17
[85] John Agnew, J. Nicholas Entrikin, The Marshall Plan today: model and metaphor, p.110
[86] Gary Murphy, In search of the promised land: the politics
of post-war Ireland, p.70
[87] James F. Lydon, The making of Ireland: from ancient
times to the present, p.391
[88] Timothy W. Guinnane, FINANCIAL VERGANGENHEITSBEWLTIGUNG: THE 1953 LONDON DEBT
AGREEMENT, p.28
[89] The Marshall Plan and the ERP. Kfw.de. Retrieved
2011-12-09.
[90] Joseph A. Biesinger, Germany: a reference guide from the
Renaissance to the present, p.556
[91] Detlef Junker, The United States and Germany in the Era
of the Cold War, 1945-1990: 1945-1968, p.306
[92] J. Bradford De Long, and Barry Eichengreen, The Marshall Plan: historys most successful structural adjustment
program (NBER No. w3899, National Bureau of Economic Research, 1991) online

16

[93] Bischof, Pelinka and Stiefel 174-175

[94] Marshall Plan style proposals for other parts of the world
have been a perennial idea. For instance, Tony Blair and
Gordon Brown have referred to their African aid goals as
a Marshall Plan. Guardian.co.uk After the end of the
Cold War many felt Eastern Bloc needed a rebuilding plan.
[95] Harry Bayard Price, The Marshall Plan and its Meaning
(1955), p. 106
[96] Timothy W. Guinnane, Financial Vergangenheitsbewltigung: The 1953 London Debt Agreement (Economic
Growth Center, Yale University, 2004) pp 17. 20, 21, 278, 30 online
[97] Crafts, Toniolo, p.363
[98] Zwass, Adam (1989). The Council for Mutual Economic
Assistance: the thorny path from political to economic integration. M.E. Sharpe. p. 16. ISBN 978-0-87332-496-0.
[99] John Gimbel, The American Reparations Stop in Germany: An Essay on the Political Uses of History
[100] GHDI Document Page. Germanhistorydocs.ghidc.org. Retrieved 2010-03-07.
[101] WISC.edu (PDF). Retrieved 2011-12-09.
[102] Economy Finland. Nationsencyclopedia.com. Retrieved 2009-02-01.
[103] De Long, J.; Barry Eichengreen (1993). The Marshall
Plan. Postwar Economic Reconstruction and Lessons for
the East Today. p. 202. ISBN 9780262041362.
[104] Economic Changes in Eastern Bloc. Since the War.
Royal Institute of International Aairs. Retrieved 201002-11.
[105] All data from the ocial document: U.S. Bureau of the
Census, Statistical Abstract of the United States: 1954
(1955) table 1075 pp 899-902 online edition le 195408.pdf
[106] Bothwell, p. 58
[107] U.S. Bureau of the Census, Statistical Abstract of the
United States: 1954 (1955) table 1075 p. 899
[108] Erhard, p. 22; also, Zmirak
[109] von Mises. Mises.org. Retrieved 2009-08-18.
[110] New York: Palgrave, 2001. 1-3.
[111] A Marshall Plan for Iraq?". Cato.org. 2003-05-09. Retrieved 2009-02-01.
[112] Forsberg, Aaron (2000). America and the Japanese miracle: the Cold War context of Japans postwar economic
revival, 1950-1960. UNC Press. p. 84. ISBN 978-08078-2528-0.
[113] Chomsky, p. 9.
[114] Van der Eng (1988).
[115] Richard D. McKinzie (July 17, 1975). Oral History Interview with Lincoln Gordon. Truman Library. Retrieved December 2, 2008.

18

REFERENCES

18 References
Alesina, Alberto and Weder, Beatrice, Do Corrupt
Governments Receive Less Foreign Aid?" American Economic Review 92 (4): (September 2002)
Beschloss, Michael R (2003). The Conquerors:
Roosevelt, Truman and the Destruction of Hitlers
Germany, 1941-1945. Simon & Schuster. ISBN 07432-6085-6
Bischof, Gunter, Anton Pelinka, and Dieter Stiefel.
Contemporary Austrian Studies. The Marshall
Plan in Austria. New Brunswick, NJ: Transaction,
2000. 174-75.
Bothwell, Robert. The Big Chill: Canada and the
Cold War. Canadian Institute for International Affairs/Institut Canadien des Aaires Internationales
Contemporary Aairs Series, No. 1. Toronto: Irwin Publishing Ltd., 1998.
Chomsky, Noam, & Ruggiero, Greg, The Umbrella
of U.S. Power: The Universal Declaration of Human Rights and the contradictions of U.S. policy,
Seven Stories Press, 2002 ISBN 1-58322-547-1
Cini, Michelle, in Schain, Martin, (ed.) From the
Marshall Plan to the EEC, in The Marshall Plan:
Fifty Years After, New York: Palgrave, 2001
Cook, Bernard A. (2001). Europe Since 1945: An
Encyclopedia. Taylor & Francis. ISBN 0-81534057-5
Crafts, Nicholas, and Gianni Toniolo, eds. Economic Growth in Europe Since 1945. Cambridge
University Press, 1996.
Erhard, Ludwig, Verentlichung von Wilhelm Rpke, in In Memoriam Wilhelm
Rpke, Ed., Universitt Marburg, Rechts-undStaatswissenschaftlice Fakultt,
Ericson, Edward E. (1999). Feeding the German Eagle: Soviet Economic Aid to Nazi Germany, 1933
1941. Greenwood Publishing Group. ISBN 0-27596337-3
Gaddis, John Lewis (2005). The Cold War: A New
History. Penguin Press. ISBN 1-59420-062-9
Gaddis, John Lewis. We Now Know: Rethinking
Cold War History. New York: Oxford University
Press, 1997
Grenville, John Ashley Soames (2005). A History of
the World from the 20th to the 21st Century. Routledge. ISBN 0-415-28954-8
Grenville, John Ashley Soames; Wasserstein,
Bernard (2001). The Major International Treaties
of the Twentieth Century: A History and Guide with
Texts. Taylor & Francis. ISBN 0-415-23798-X

17
Grogin, Robert C. (2001). Natural Enemies: The
United States and the Soviet Union in the Cold War,
1917-1991. Lexington Books. ISBN 0739101609

Press, 1952 Prot and Loss Ludwig von Mises

Mises Institute. Mises.org. Retrieved 2009-0818.

Hogan, Michael J. The Marshall Plan: America,

Britain, and the Reconstruction of Western Europe,
19471952. Cambridge: Cambridge University
Press, 1987.

Wettig, Gerhard (2008). Stalin and the Cold War

in Europe. Rowman & Littleeld. ISBN 0-74255542-9

Miller, Roger Gene (2000). To Save a City: The

Berlin Airlift, 1948-1949. Texas A&M University
Press. ISBN 0-89096-967-1
Milward, Alan S. (2006). The Reconstruction of
Western Europe 1945-51. Berkeley: University of
California Press. ISBN 9780520060357.
Nekrich, Aleksandr Moiseevich; Ulam, Adam
Bruno; Freeze, Gregory L. (1997). Pariahs, Partners, Predators: GermanSoviet Relations, 1922
1941. Columbia University Press. ISBN 0-23110676-9
Peterson, Harold F., Argentina and the United States
II. (19141960)
Roberts, Georey (2006). Stalins Wars: From
World War to Cold War, 19391953. Yale University Press. ISBN 0-300-11204-1

Woods, Thomas E., The Politically Incorrect Guide

to American History, . ISBN 0-89526-047-6

19 Further reading
Agnew, John and Entrikin, J. Nicholas eds. The
Marshall Plan Today: Model and Metaphor Routledge. (2004) online version
Arkes, Hadley. Bureaucracy, the Marshall Plan, and
the National Interest (1972).
Behrman, Greg, The Most Noble Adventure: The
Marshall Plan and the Time When America Helped
Save Europe (2007) ISBN 0-7432-8263-9
Bonds, John Bledsoe. Bipartisan Strategy: Selling
the Marshall Plan (2002) online version

Schain, Martin, ed. The Marshall Plan: Fifty Years

After. New York: Palgrave, 2001.

Esposito, Chiarella. Americas Feeble Weapon:

Funding the Marshall Plan in France and Italy,
19481950 (1994) online version

Shirer, William L. (1990). The Rise and Fall of the

Third Reich: A History of Nazi Germany. Simon &
Schuster. ISBN 0-671-72868-7

Djelic, Marie-Laure A. Exporting the American

Model: The Post-War Transformation of European
Business (1998) online version

Stern, Susan, Marshall Plan 19471997 A German ViewGerman Missions in the United States
Home. Germany.info. Retrieved 2009-08-18.

Elwood, David, Was the Marshall Plan Necessary?" in Alan S. Milward and a Century of European Change, ed. Fernando Guirao, Frances M.
B. Lynch, and Sigfrido M. Ramrez Prez, 17998.
(Routledge, 2012)

Stueck, William Whitney, ed. The Korean War in

World History. Lexington, Ky.: University Press of
Kentucky, 2004.
Tucker, Jerey, The Marshall Plan Myth The Free
Market 15:9 (Sept 1997)
Turner, Henry Ashby (1987). The Two Germanies
Since 1945: East and West. Yale University Press.
ISBN 0-300-03865-8
Van der Eng, Pierre (1988). Marshall Aid as a Catalyst in the Decolonisation of Indonesia 1947-1949,
Journal of Southeast Asian Studies, 19: 335-352.
Van Meter Crabb, Cecil, American foreign policy in
the nuclear age, Harper & Row, New York, 1965
von Mises, Ludwig, Prot and Loss presented
to the Mont Plerin Society held in Beauvallon,
France, September 9 to 16, 1951; reprinted in Planning for Freedom, South Holland, Ill., Libertarian

Fossedal, Gregory A. Our Finest Hour: Will Clayton,

the Marshall Plan, and the Triumph of Democracy.
(1993).
Gimbel, John, The origins of the Marshall plan
(1976) (reviewed)
Jackson, Scott. Prologue to the Marshall Plan: The
Origins of the American Commitment for a European Recovery Program, Journal of American History 65#4 (1979), pp. 1043-1068 in JSTOR
Kipping, Matthias and Bjarnar, Ove. The Americanisation of European Business: The Marshall Plan
and the Transfer of Us Management Models (1998)
online version
Lewkowicz, Nicolas. The German Question and the
International Order, 1943-48 (Palgrave Macmillan:
Basingstoke and New York) (2010)

18

20

EXTERNAL LINKS

Lewkowicz, Nicolas. The German Question and the

Origins of the Cold War (IPOC: Milan) (2008)

Marshall Plan Still Working, 60 Years Later Cincinnati Enquirer December 10, 2006

Mee, Charles L. The Marshall Plan: The Launching

of the Pax Americana (1984).

Economist Tyler Cowen questions the conventional

wisdom surrounding the Plan

Milward, Alan S. The Reconstruction of Western

Europe, 194551. (1984).

Truman Presidential Library online collection of

original Marshall Plan documents from the year
1946 onwards

Rpke, Wilhelm, Humane Economist,Biography

of Wilhelm Rpke (18991966):
Humane
Economist. Mises.org. Retrieved 2009-08-18.
Vickers, Rhiannon. Manipulating Hegemony: State
Power, Labour and the Marshall Plan in Britain
(2000) online edition

The Marshall Plan as Tragedy, comment on

Michael Cox and Caroline Kennedy-Pipe, The
Tragedy of American Diplomacy? Rethinking the
Marshall Plan, both published in the Journal of
Cold War Studies, vol. 7, no. 1 (Winter 2005) (text
of comment on pdf) (text of original article on pdf)

Wallich, Henry Christopher. Mainsprings of the

German Revival (1955)

Speech by George Marshall on June 5, 1947 at Harvard University (original recording)

Wasser, Solidelle F. and Dolfman, Michael L.,

BLS and the Marshall Plan: The Forgotten Story:
The Statistical Technical Assistance of BLS Increased Productive Eciency and Labor Productivity in Western European Industry after World
War II; Technological Literature Surveys and PlanOrganized Plant Visits Supplemented Instruction in
Statistical Measurement, Monthly Labor Review,
Vol. 128, 2005
Wend, Henry Burke. Recovery and Restoration:
U.S. Foreign Policy and the Politics of Reconstruction of West Germanys Shipbuilding Industry, 1945
1955 (2001) online version
Zmirak, John, Wilhelm Rpke: Swiss Localist,
Global Economist (ISI Books, 2001)

20

External links

George C. Marshall Foundation

The German Marshall Fund of the United States
Marshall Plan from the National Archives
Excerpts from book by Allen W. Dulles
United States Secretary of State James F. Byrnes
famous Stuttgart speech, September 6, 1946 The
speech marked the turning point away from the
Morgenthau Plan philosophy of economic dismantlement of Germany and towards a policy of economic reconstruction.
Marshall Plan Commemorative Section: Lessons of
the Plan: Looking Forward to the Next Century
Pas de Pagaille!", Time magazine July 28, 1947
Luis Garca Berlangas critique of the Marshall Plan
in a classic Spanish lm: Welcome Mr. Marshall!

19

21
21.1

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