Marshall Plan

The Marshall Plan, known officially following its enactment as the European Recovery Program (ERP), was the main plan of the United States for the reconstruction of Europe following World War II. The initiative was named for United States Secretary of State George Marshall and was largely the creation of State Department officials including William L. Clayton and George F. Kennan.

Historiography

The early students of the Marshall Plan saw it as an unmitigated success of American generosity. Criticism of the Marshall Plan became prominent among historians of the revisionist school during the 1960s and 1970s, however. 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 Eastern Europe. Far from generosity the plan was the result of the United States' geopolitical goals.

Related Topics:
Revisionist - Imperialism

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Other historians emphasize the benefits of the plan to U.S. industry. One result of the destruction in Europe as a result of two world wars was that the U.S. farming and industry had world superiority. American private enterprise thus could only gain financially from opening new markets and free trade policies. Yet while European reconstruction required products from the U.S., the Europeans in the immediate aftermath of the Second World War did not have the dollars to buy these supplies. That was, it is argued, the basic economic problem; essentially European capitalism suffered from a dollar shortage. The U.S. had large balance of trade surpluses, and U.S. reserves were large and increasing. The credit facilities of the IMF and the International Bank for Reconstruction and Development could not cope with Western Europe's large trade deficits, and anyway the IMF was only supposed to grant loans for current-account deficits, and not for capital finance and reconstruction purposes. Therefore the U.S. began to create dollar credits in Europe, by various routes of which the Marshall Plan was one.

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In the 1980s a new school developed with some historians arguing that the Marshall Plan might not have played as decisive a role in Europe's recovery as was previously believed. The first person to make this argument was the economic historian Alan S. Milward and the analysis was developed by the German historian Gerd Hardach in Der Marshall Plan (1994). Such critics have pointed out that economic growth in many European countries revived before the large-scale arrival of U.S. aid, and was fastest among some of the lesser recipients. While aid from the Marshall Plan eased immediate difficulties and contributed to the recovery of some key sectors, growth from the postwar nadir was largely an independent process. European socialists argue that a similar amount of reconstruction money could have been obtained by nationalizing the holdings of wealthy Europeans who deposited their money in U.S. banks during World War II.

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Today, the general consensus has reverted to the earliest argument. It is acknowledged that the United States was acting in its own self-interest by aiding Western Europe, but most believe the plan had an important and beneficial effect on both Western Europe and the United States.

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