Comprehensive project designed and implemented by the
Truman administration to underwrite restoration of Western
Europe’s World War II–ravaged economy.
The Marshall Plan to aid in rebuilding Europe after World
War II was proposed in 1947 and signed into law in 1948 during the administration of President Harry S Truman. The
Economic Cooperation Administration administered the
plan, which also was known as the European Recovery Plan.
It aimed to enhance America’s long-term economic, political,
and strategic interests at a time when Western European
economies faced devastation following the end of World War
II. U.S. policymakers believed that recovered Western European economies could provide a desired market for American goods and help make the United States a leading economic power in the postwar world. Also, they envisioned
Western Europe as part of a multilateral system of world
trade crucial to the liberal capitalist economy that Washington had in mind for itself and its allies. Unity in Western Europe would foster an American-type liberal capitalist order
able to create high productivity, comfortable living standards,
and political stability. Third, Washington saw the Marshall
Plan as a means of strengthening shaky pro-American governments in Western European nations and a way of warding
off rapid inroads being made by domestic communist parties
and left-wing organizations leaning toward the Soviet Union.
Thus did the European Recovery Plan emerge as an allembracing effort for the economic revival of Western Europe
as a whole.
U.S. Secretary of State George Marshall first publicized
such a plan in a commencement speech at Harvard University on June 5, 1947. To avoid having the Marshall Plan
viewed as anti-Soviet, Marshall subsequently invited the Soviet Union and its Eastern European satellite states to participate in its design; all the while, U.S. policymakers calculated
Moscow’s offhand rejection. The Soviet Union, together with
Poland and Czechoslovakia, appeared at the first planning
conference (convened in Paris on June 27, 1947) for Marshall’s proposal, but as the United States had predicted it
quickly withdrew, denouncing the plan as building an antiSoviet bloc of Western capitalist powers. Lengthy negotiations followed without the Soviets; participants (17 Western
European nations in all) laid the groundwork for a four-year
recovery plan. On the plan’s completion, the United States
created the Economic Cooperation Administration and
named Paul Hoffman the head. The Organization for European Economic Cooperation established by the 17 Western
European states would coordinate the American effort.
From 1948 to 1952, $13.15 billion in Marshall Plan aid
helped revitalize Western Europe and ushered it onto a path
of durable economic growth and integration. The recharged
economies that owed their lives to the Marshall Plan led to
more stable political systems that discouraged communist
encroachment in Western Europe. In addition, the United
States buttressed its economic and political influence over
Western Europe. Finally, the Marshall Plan widened the cold
war gulf between the United States and the Soviet Union.
Rather than surrender communism and its command economy to an American-dominated capitalist system, Moscow
began its draconian policy of quarantining its Eastern European client states from the rest of Europe.
—Guoqiang Zheng
References
Hogan, Michael J. The Marshall Plan: America, Britain, and
the Reconstruction of Western Europe, 1947–1952. New
York: Cambridge University Press, 1987.