Marshall Plan

Marshall Plan From Wikipedia, the free encyclopedia Jump to navigationJump to search For the computer program, see Marshall Plan (software). "European Recovery Program" redirects here. It is not to be confused with 2008 European Union stimulus plan. Marshall Plan Great Seal of the United States Long title An Act To promote world peace and the general welfare, national interest, and foreign policy of the United States through economic, financial, and other measures necessary to the maintenance of conditions abroad in which free institutions may survive and consistent with the maintenance of the strength and stability of the United States. Enacted by the 80th United States Congress Effective April 3, 1948 Citations Public law 80-472 Statutes at Large 62 Stat. 137 Legislative history Introduced in the Senate as S. 2202 Passed the Senate on March 13, 1948 (71-19) Passed the House on March 31, 1948 (333-78) Reported by the joint conference committee on April 1, 1948; agreed to by the House on April 2, 1948 (321-78) and by the Senate on April 2, 1948 (agreed) Signed into law by President Harry S. Truman on April 3, 1948 The labelling used on aid packages created and sent under the Marshall Plan. General George Marshall, the 50th U.S. Secretary of State The Marshall Plan (officially the European Recovery Program, ERP) was an American initiative passed in 1948 for foreign aid to Western Europe. The United States transferred over $13 billion (equivalent to $130 billion in 2020) in economic recovery programs to Western European economies after the end of World War II. Replacing an earlier proposal for a Morgenthau Plan, it operated for four years beginning on April 3, 1948.[1] The goals of the United States were to rebuild war-torn regions, remove trade barriers, modernize industry, improve European prosperity, and prevent the spread of communism.[2] The Marshall Plan required a reduction of interstate barriers, a dropping of many regulations, and encouraged an increase in productivity, as well as the adoption of modern business procedures.[3] The Marshall Plan aid was divided among 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 the general European revival. Somewhat more aid per capita was also directed toward 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 the United Kingdom (receiving about 26% of the total), but the enormous cost that Britain incurred through the "Lend-Lease" scheme was not fully re-paid to the USA until 2006.[4] The next highest contributions went to France (18%) and West Germany (11%). Some eighteen European countries received Plan benefits.[5] Although offered participation, the Soviet Union refused Plan benefits, and also blocked benefits to Eastern Bloc countries, such as Hungary and Poland.[6] The United States provided similar aid programs in Asia, but they were not part of the Marshall Plan.[7] Its role in the rapid recovery has been debated. The Marshall Plan's accounting reflects that aid accounted for about 3% of the combined national income of the recipient countries between 1948 and 1951,[8] which means an increase in GDP growth of less than half a percent.[9] After World War II, in 1947, industrialist Lewis H. Brown wrote (at the request of General Lucius D. Clay) A Report on Germany, which served as a detailed recommendation for the reconstruction of post-war Germany, and served as a basis for the Marshall Plan. The initiative was named after United States 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 officials, especially William L. Clayton and George F. Kennan, with help from the Brookings Institution, as requested by Senator Arthur Vandenberg, chairman of the United States Senate Committee on Foreign Relations.[10] 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 World War II and to reduce the influence of communist parties within them. To combat the effects of the Marshall Plan, the USSR developed its own economic plan, known as the Molotov Plan, in spite of the fact that large amounts of resources from the Eastern Bloc countries to the USSR were paid as reparations, for countries participating in the Axis Power during the war. The phrase "equivalent of the Marshall Plan" is often used to describe a proposed large-scale economic rescue program.[11] In 1951 the Marshall Plan was largely replaced by the Mutual Security Act.