Marshall Plan Aid example essay topic

Americans foresaw the battle with global communism as soon as World War Two ended. The Second World War had left many European nations economically and physically devastated either from Nazi occupation or fierce military action. The United States government felt that these conditions were breeding grounds for the spread of communism. But America did not respond to the threat with military action, instead it employed a new weapon in foreign policy, economic aid. The Marshall Plan laid the groundwork for foreign aid as a key element in foreign policy.

This tactic would be used throughout the Cold War and was probably one of the factors responsible for keeping the war "cold". The Marshall Plan was the one most successful foreign policy strategies in the history of our nation, and it all began with General Marshall stepping up to the podium one summer day. General George Marshall delivered his idea of a European recovery program in a speech at Harvard University on June 5, 1947.1 The speech dealt not with the dangers of communism but with our shared responsibility to help the war-torn and economically depressed Europeans. Marshall called attention to the bleak circumstances of Western Europe, noting that "Long-standing commercial ties, private institutions, banks, insurance companies, and shipping companies disappeared, through loss of capital, absorption through nationalization, or by simple destruction". 2 European countries, he said, were forced to spend all their scarce funds on immediate necessities like imported food and fuel, making reconstruction and recovery impossible. He saw Europe as heading towards a massive financial and political collapse if immediate action were not taken.

Marshall's remedy lay in "breaking the vicious circle and restoring the confidence of the European people in their economic future". 3 Aiding Europe was the duty of the United States, Marshall explained, and doing so would ensure both economic and political stability. But more importantly, "Our policy is directed not against any country or doctrine but against hunger, poverty, desperation, and chaos... and permit the conditions... in which free institutions can exist". 4 Marshall's proposal made the program sound like a charitable act, but although America was somewhat infused with an "altruistic political culture"5, this was not really the case. The Marshall Plan or the European Recovery Program was created for two distinct purposes: 1. to create a strong European economy in which there was great demand for American goods 6 and 2. to create a strong and united Europe which would form a barrier against Soviet expansion 7. Learning from the example of Hitler's rise in an economically devastated Germany after World War One, The United States government believed that only a prosperous Europe could effectively resist communism.

8 Communist political parties were starting to gain popularity in Czechoslovakia, France, Greece, and Italy. The United States needed Europe as one strong entity in order to keep Soviet influence from spreading. The program relied on a long held capitalist premise, "peace, labor productivity, consumerism, welfare, and profits went hand in hand". 9 The Marshall Plan was intended to push Europe toward greater political and economic cooperation, and to contain the "red menace". The US government saw the value of extending Truman's containment doctrine, originally concerning only Asia, to all of Europe. After passage in Congress, The European Recovery Program Act was signed by President Truman on April 3, 1948.10 It called for 17.6 billion dollars of aid to be transferred to 16 European countries over a 4 year period.

11 The Marshall Plan was the largest voluntary transfer of resources in history. 12 Besides money, the aid included food, fuel, machinery, and technical advisors. US technical experts, consultants, and managers contributed their expertise to European banks, factories, and political institutions, "American experts showed the Dutch how to cut processing time [of cleaning products] from five days to two hours with new machinery". 13 These experts strongly believed in "welfare capitalism", a system that was, "confident, committed to raising productivity and wages, and expanding markets"14 and which promoted friendly labor relations. This style of capitalism was deeply instilled in the European businessmen and politicians.

The personnel transfer was not only from America to Europe, the reverse was also true. Under the Marshall Plan, France dispatched large numbers of business executives, trade unionists, civil servants to the United States with an eye toward absorption of American productivity. They returned not only with... butch haircuts and wireless lunches, but also with an appreciation of how business was conducted in a relatively dynamic, seemingly disorganized setting 15 -William James Adams, economist Another important element of the Marshall Plan was that the funds and supplies provided by the US were, for the most part, well administered. There were no scandals or controversy over the spending by Europeans. The money went where it was needed and not into the pockets of racketeers or corrupt officials. US policy makers saw European unification only through a "common market".

The uniting power of the Marshall Plan was evident in the success of the Organization for European Economic Cooperation and Development, or OEEC 16. The OEEC, which administered US aid, worked successfully in increasing production, controlling inflation, and promoting European economic cooperation by lowering trade barriers. Through this and other organizations, networks of "intra-European and transatlantic"17 contacts were formed by businessmen and civil servants, creating strong business bonds throughout Europe. "In 1945, only twenty-five thousand tractors were in use on French Farms; four years later, Marshall Plan aid had put another two hundred thousand tractors in the field". 18 Western Europe was infused with a new confidence as production exploded beyond pre-war levels. The GNP in Europe rose 32.5% and industrial production rose 40% from pre-war levels.

19 The Marshall Plan improved living standards and strengthened political stability. With more money in the hands of Europeans, The United States could begin to reduce its surplus of export goods. Money from Europe started flowing back into the American economy. US businessmen found new European customers that had and were willing spend money. As Europe's economy skyrocketed, American manufacturers were rewarded. The shared benefit created a spirit of mutual help and support between the United States and Europe, leading to a "strong and enduring NATO alliance".

The Marshall Plan aid ended on December 31st, 1951. But the principals of the plan continue today in our foreign policy. General Marshall established the use of economic aid in foreign policy. As a result of his actions, a strong and united NATO alliance was formed and the spirit of cooperation between Europe and The United States flourished. The Marshall Plan is considered one of the most successful foreign policy plans in history.

Even though the intentions of the plan weren't totally altruistic, America showed the world that battles could be fought with food instead of weapons, a principle that our country must never forget. 1. web -General Marshall's speech at Harvard University 2. Ibid 3. Ibid 4. Ibid 5. web -European view on the Marshall Plan 6. web -Marshall Plan Summery 7. Ibid 8. web -The Marshall Plan by Peter Duignan and Lewis Gann 9. Ibid 10. web - Truman Signs the Economic Assistance Act 11. web -The Marshall Plan by Peter Duignan and Lewis Gann 12.

Ibid 13. Ibid 14. Ibid 15. Ibid 16. Hogan, Michael J. The Marshall Plan: America, Britain, and the Reconstruction of Western Europe 1947-1952 (Cambridge University Press, 1987).

17. web -The Marshall Plan by Peter Duignan and Lewis Gann 18. Ibid 19. web -The History of the Marshall Plan 20. Ibid.