“The Marshall Plan must…be viewed as one of the most successful foreign policy initiatives—and perhaps the most successful peacetime foreign policy—in United States history.”¹

In June 1999, shortly before the 25^th G-8 Summit, New York Times correspondent David Sanger reported that representatives would be discussing a plan to forgive roughly $130 billion in debt owed by some of the world’s poorest countries—a plan, Sanger explained, whose advocates regarded it as “a Marshall Plan for the poor.” “The use of the term,” he continued, “is no surprise: Congress despises foreign aid almost as much as it loves phantom tax cuts. But call it a Marshall Plan, and suddenly it’s not a handout, but a noble effort to turn beaten, bombed-out, or broke nations into models of democratic capitalism.”² Hardly a day passes without calls for a “Marshall Plan” to assist some impoverished country or region; Washington Post opinion columnist David Ignatius wrote last June that “[i]f you do a Google search on the phrase ‘We need a Marshall Plan for…’, you get about 8,000 different entries.”³

April 3, 2018 marks the 70^th anniversary of the Foreign Assistance Act of 1948, which brought into force the European Recovery Program—more commonly known as the Marshall Plan, in honor of its chief architect, the late soldier-statesman George C. Marshall. Under its terms, the United States provisioned some $13.3 billion in aid—comprising $11.8 billion in grants and $1.5 billion in loans—to 16 countries in Europe, a figure that would be equivalent to roughly $135 billion today.⁴ There are many outstanding debates about the motives behind the Marshall Plan’s formulation and the impact of its application. Was it conceived primarily as an instrument for Western Europe’s economic resuscitation, a pillar of the Truman Administration’s incipient campaign to contain the Soviet Union, or some combination thereof? To what extent did it generate a recovery in Western Europe, as opposed to accelerating one that was already in motion? How much did it contribute directly to the region’s rehabilitation, as opposed to assisting indirectly (by giving countries therein breathing room to implement structural reforms)? Some observers even question whether it was necessary for Western Europe’s convalescence. Economic historian Niall Ferguson, for example, a noted advocate of counterfactual analysis, speculates that “Western Europe could have pulled through without the Marshall Plan.”⁵

Few dispute, however, that that undertaking was a success, arguably without equal in the annals of U.S. foreign policy. Consider Western Europe’s economic position after Marshall Plan aid had been fully disbursed:

By the end of 1951, industrial production for all participating countries was 64 percent higher than in 1947. Total gross national product rose by about 25 percent. The dollar deficit that had been a major issue at the start of the Marshall Plan dropped from $8 billion to about $2 billion in 1952 and into an approximate balance by 1953. Three-quarters of the intra-European import quota restrictions that Europeans had promised to address were eliminated by 1951. At the end of that year, trade volume within Europe was almost double that of 1947.⁶

The Marshall Plan also advanced the quest for European integration: The Council on Europe concluded in 1949 that “the American policy of economic aid, coupled with the pressure of the Communist danger, created conditions in which, for the first time, the unification of Europe became a practical possibility.”⁷ Henry Kissinger assesses its legacy in even grander terms: The Marshall Plan “inspired a new international order by enabling the nations of Europe first to rediscover their own identities in its pursuit, then to go on to build systems transcending national sovereignty, such as the Coal and Steel Community and, eventually, the European Union.”⁸

Why was the Marshall Plan successful? As with much else in history, the answer is overdetermined; its achievements can only be understood by considering a confluence of mutually reinforcing phenomena. The late journalist Frank Trippett rightly observed four decades ago that it “arose out of a specific juncture of event, public mood, and leadership.”⁹ Seven factors deserve particular mention.

Seven Central Explanations  

Explanation 1: The devastation that Western Europe suffered during the Second World War did not destroy its socioeconomic foundations.

The task of the Marshall Plan was to resuscitate industrialized polities, not to fashion new ones: As the late economist Walt Rostow explained a half-century after Marshall’s famed commencement address at Harvard, “Western Europe did not need to be invented, it simply had to be recalled. With its skilled and educated work force, its market experience, and its mature political structures, modern Europe is not easy to replicate.”¹⁰ As generous as the Marshall Plan was, moreover, it is more accurately understood as having accelerated a recovery already underway than as having initiated one: “By the time Marshall aid started to flow, in the spring of 1948,” explains journalist James Surowiecki, “Western Europe was hardly a wasteland. Most of the region’s industrial infrastructure—electrical grids, water systems, roadways, and railways—had already been rebuilt. Trains were carrying almost as much freight as they had carried before the war. Industrial production was rebounding.”¹¹

Explanation 2: Marshall Plan aid gave Western European countries the freedom of maneuver to pursue urgent but risky economic reforms. 

It is unlikely that the Marshall Plan would have produced sustainable improvements in Western Europe’s economic condition had it simply been an act of charity. Economists J. Bradford DeLong and Barry Eichengreen conclude that, instead, it “significantly sped Western European growth by altering the environment in which economic policy was made.” Without the Marshall Plan, they continue, countries in the region “would have soon faced a harsh choice between contraction to balance their international payments and severe controls on admissible imports.”¹² Marshall and his colleagues concluded that conditioning the provision of aid on the implementation of contractionary policies would plunge Western Europe further into recession. Consequently, explains historian Charles Maier, “[p]ostwar American leaders repeatedly postponed austerity requirements when confronted with French and Italian tax evasion and budget deficits. They let Marshall Plan funds cover budgetary deficits, wagering correctly that growth would ultimately wipe out the deficits.”¹³

Explanation 3: The United States treated Western Europe as a full partner in the Marshall Plan’s implementation, not as a defeated subordinate.

While contemporary accounts of the Marshall Plan often, and properly, note the scale of its ambition, they sometimes neglect the extent to which it simultaneously reflected an appreciation for the limits of power. Daniel Kurtz-Phelan, executive editor of Foreign Affairs and author of a forthcoming book on Marshall’s mission to China in the late 1940s, explains that his failure to prevent the collapse of Chiang Kai-shek’s Nationalist government played a critical role in shaping his thinking about various proposals for reviving Western Europe’s industrial base: Marshall “learned in China that the United States could not force solutions from the outside. It could not want something more than its partners did.”¹⁴

The Marshall Plan was consciously designed, then, to be a U.S. initiative, not a dictate. Near the conclusion of his commencement speech, Marshall explained that

there must be some agreement among the countries of Europe as to the requirements of the situation and the part those countries themselves will take in order to give proper effect to whatever action might be undertaken by this government. It would be neither fitting nor efficacious for this government to undertake to draw up unilaterally a program designed to place Europe on its feet economically. This is the business of the Europeans. The initiative…must come from Europe. The role of this country should consist of friendly aid in the drafting of a European program and of later support of such a program so far as it may be practical for us to do so.¹⁵

He affirmed this point five days later in a letter to Senator Arthur Vandenberg, then the chairman of the Senate Foreign Relations Committee: “[W]e should make clear that it is not our purpose to impose upon the peoples of Europe any particular form of political or economic association. The future organization of Europe must be determined by the peoples of Europe.”¹⁶ On January 12, 1948, Marshall testified before the House Foreign Affairs Committee on the urgency of initiating a European recovery program. Committee Chairman Charles Eaton asked him how he would “meet the assertion…that if we follow out this program, we will interfere with the sovereignty and enslave these countries whom we are trying to set free.”¹⁷ Surprised by the question yet composed in his response, Marshall assured Eaton that the effort could hardly be construed as “a conspiracy for economic imperialism.” The late political scientist Stanley Hoffmann corroborated that conclusion three and a half decades later:

[F]or all its boldness, the Marshall Plan carefully preserved the sovereignty of the participants; they were being incited—prodded, some would say—to cooperate, they were not being asked to transfer power and resources to any supranational agency (otherwise, England would never have joined). As a result, the West European countries did not experience the tug-of-war that has plagued the European experiment since 1950: between obvious common interests in a variety of fields, and the separate interest of each state in preserving its own autonomy and the freedom of action needed to look after those of its interests that were anything but common to all.¹⁸

Making Western Europe the principal agent of the Marshall Plan’s implementation was triply prudent. First, it neutered the Soviet charge that U.S. beneficence was a masquerade for imperialism. Second, it compelled the countries of the region to subordinate bilateral suspicions to collective aspirations; the provision of Marshall Plan aid, in fact, “was contingent upon each country committing itself to work with each other country.”¹⁹ Third, it boosted the region’s morale: According to the late Andrew Goodpaster, who helped Marshall draft his 1953 Nobel Peace Prize address, the “true heart and genius of the Marshall Plan was that it gave the people of Europe hope, restored their pride, and delivered on the promise of something better. It proposed that the countries of Europe, acting in concert, should tell the United States what they deemed best to meet their needs—not the other way around.”²⁰ In this way, the Marshall Plan was always sensitive to, and conceived to mitigate, the damage that the war had inflicted upon Western Europe’s self-confidence: The late Tony Judt observed that the policy would likely not have succeeded “had the Marshall Plan been presented as a blueprint for the ‘Americanization’ of Europe.”²¹

Explanation 4: The Marshall Plan was imbued with, and impelled by, a clear strategic purpose.

The Marshall Plan did not originate in a strategic vacuum. Over two years before it was approved, George Kennan had published his influential “Long Telegram,” which articulated the framework of containment that would shape U.S. foreign policy for nearly a half-century. In a March 12, 1947 speech before Congress, moreover, President Truman enunciated what would come to be known as the Truman Doctrine, declaring that the United States would “support free peoples who are resisting attempted subjugation by armed minorities or by outside pressures.” Two and a half months later, Under Secretary of State for Economic Affairs William Clayton advised Marshall that Europe was “steadily deteriorating. The political position reflects the economic. One political crisis after another merely denotes the existence of grave economic distress. Millions of people in the cities are slowly starving.” Without an infusion of U.S. assistance to underwrite its balance of payments deficit, which he estimated to be above $5 billion, he warned that “economic, social, and political disintegration” would “overwhelm Europe.”²²

Clayton’s analysis suggested that the Soviet Union could exploit that chaos to extend its realm of dominion. Historian Melvyn Leffler contends that postwar U.S. officials “wanted to redress the European balance of power and to enhance American national security….from their viewpoint, the most fundamental strategic interest of the United States was to prevent any potential adversary or coalition of adversaries from mobilizing the resources and economic-military potential of Europe for war-making purposes against the United States.”²³ The Marshall Plan would emerge as the quintessential example of geoeconomic statecraft: Far from being incidental to or coincidentally aligned with President Truman’s high-level thinking on foreign policy, it was a linchpin of the Administration’s statecraft. According to Benn Steil, director of international economics at the Council on Foreign Relations and author of a new history of the Marshall Plan, “economic rehabilitation became a primary tool of [America’s] so-called strongpoint defense of critical geostrategic regions…aimed at building up independent, self-confident, and energetic centers of power capable of resisting Soviet pressure.”²⁴

Explanation 5: Fears of Soviet inroads weakened political opposition to the Marshall Plan.

It is little remembered today that the United States offered aid to the Soviet Union as part of the Marshall Plan. While the Soviets were wary, they did not immediately reject the possibility of participation. Ultimately, though, they came to conclude that the U.S. initiative was rooted in a desire to encircle Moscow: On July 3, 1947, Soviet Foreign Minister Vyacheslav Molotov accused its architects of trying to divide Europe into antagonistic camps, characterizing the Marshall Plan as “an attempt to use American economic power to undermine the newly established Soviet buffer zone in Eastern Europe.”²⁵ Just a little over seven months later, on February 25, 1948, the government of Eastern Europe’s last democratic holdout, Czechoslovakia, resigned in face of a Communist uprising; the new leadership quickly aligned itself with the Soviets. Historian Evan Thomas notes that ensuing U.S. anxiety over the prospect of a Soviet incursion into Western Europe was inflated:

We now know that after World War II the Red Army began tearing up railroad tracks in Eastern Europe because Stalin feared an attack by the West against the Soviet Union. Exhausted by a war that cost the lives of 20 million Russians, the Kremlin was not ready to wage another. Because of poor intelligence, Washington did not fully appreciate Russia’s weakness. Top policymakers were aware, however, that the hysteria was exaggerated, that war was unlikely.²⁶

Still, the fear of Soviet aggression softened opposition to the Marshall Plan, especially in light of broader political currents within Western Europe:

With popular elections due in Italy on April 12 and the fear of a Communist victory there as well, the Communist Party in France gaining strength in the context of ongoing labor throughout the country, and funding of the interim food relief program about to run out, Congressional opposition to financing economic assistance to Europe under the Marshall Plan simply evaporated.²⁷

Advocates of the Marshall Plan stressed the primacy of strategic considerations over economic ones when doing so was politically expedient. Historian Kim McQuaid notes that when they sought to persuade or marginalize isolationist Republicans, “foreign aid often became politics first and economics second. The Marshall Plan was not charity…[but] a matter of self-interest and survival…minimalist conservatives had to cease their opposition to bigger government and support foreign aid as a necessary antidote to Soviet imperialism.”²⁸

Explanation 6: The architects of the Marshall Plan were politically shrewd.

President Truman rejected a proposal for the plan to be called the “Truman Formula,” telling his counselor and speechwriter Clark Clifford that “[a]nything that is sent up to the Senate and House with my name on it will quiver a couple of times and then turn over and die.” Clifford recalls: “It was Truman’s idea that the speech [at Harvard’s commencement] be given by Marshall and that it be totally nonpolitical.”²⁹ President Truman was adamant that the effort not bear his imprimatur, though, of course, he was perhaps its most important champion: “Can you imagine its chances of passage in an election year in a Republican Congress if it is named for Truman and not Marshall?”³⁰ He also ensured that the campaign to refine the plan and sell its merits was bipartisan from the outset: “Immediately after Marshall’s Harvard speech, President Truman brought Senator Vandenberg into almost daily contact with Dean Acheson and Averell Harriman, who together with Marshall and other members of the Cabinet launched a nationwide campaign for public support.”³¹

The policy’s architects could act as such savvy political operators in part because they commanded enormous respect in the first place. Just as ill-conceived proposals can gain traction in the hands of skilled messengers, visionary ones can founder in the hands of incompetent ones. Carnegie Endowment for International Peace Distinguished Fellow Moisés Naím explains that the leaders

who pulled off this complex project were not merely brilliant and farsighted but also excellent organizers. Such men as George Marshall in the United States and Jean Monnet, Ernest Bevin, and Robert Schuman in Europe combined their vision with astute political instincts. Some, like Marshall, had been wartime leaders and could draw on a vast reservoir of public affection and trust. Others—including William Clayton, Paul Hoffman, and W. Averell Harriman—were recruited from the top ranks of U.S. businesses and brought extensive managerial experience.³²

Explanation 7: The Truman Administration embarked on an intense public relations campaign to gain traction for the Marshall Plan.

The nostalgia that contemporary observers express for the Marshall Plan belies the political resistance it encountered upon its initial articulation. Congress was little inclined to provide charity, let alone on the scale that President Truman had requested; indeed, after approving comparatively far smaller sums of emergency aid to Greece and Turkey, it sought assurances that disbursements to Europe would end. Moreover, many members of Congress feared that approving the Marshall Plan would entail economic repercussions for the United States. According to one of its foremost historians, Michael Hogan, there was

a group of economy-minded legislators who were convinced that Marshall aid would aggravate existing shortages in the United States. It would drive up the wholesale price index, they argued, and end in new government controls over the economy. These arguments had more than a passing appeal to a population weary of wartime sacrifices, high taxes, government controls, and items in short supply.³³

In September 1947, the 16-country Committee on European Economic Cooperation asked the United States to furnish $19 billion in import support; that December, President Truman submitted to Congress a request of $17 billion. Republican Senator Robert Taft argued that “no nation can hope to repay such sums, any more than they were able to do so after the First World War.” He denounced the State Department for embarking on “a tremendous propaganda drive” in support of a program that was, in his judgment, largely tantamount to “a European TVA.” Taft also contended that Western European countries would have less incentive “to make the reforms in fiscal policy which are absolutely essential for their recovery” if they concluded that the United States would unilaterally underwrite the debts they had accrued during the war.³⁴ Senator Bourke Hickenlooper derided the proposal as “a complete donation program from top to bottom.” Other critiques were even more scathing; Representative Roy Woodruff, for example, charged that there was “something so abnormal, so self-annihilating, about a program that calls upon a single nation to take care of so many other nations.”³⁵ Selling the Marshall Plan would prove to be a far more demanding task than its architects had envisioned:

Despite evidence of support for the Marshall Plan in Congress and among the general public, it was apparent by the fall of 1947 that many people had either never heard of it or remained unconvinced of its necessity. The Truman administration consequently launched a massive public relations campaign to educate the American public, and it encouraged private citizens to participate in these efforts. Secretary Marshall, joined by other members of the administration, made numerous public appearances before various civic and trade groups to promote the European aid program. Indeed, Marshall made so many speaking trips, especially to rural communities in the South and Midwest, that he later remarked that he felt as if he were running for office.³⁶

Marshall was not alone in his Herculean exertions. Take Paul Nitze, then a geoeconomist at the State Department: Tasked with operationalizing the Marshall Plan, he “produced a series of famed ‘little brown books’, one on each of the participating countries. In the course of defending the program in 43 congressional hearings before what he recalls as ‘a very resistant’ Congress he lost some 15 pounds.”³⁷ The rigorous scrutiny applied to the Marshall Plan before the program was unveiled ultimately helped convert even acute skeptics. Ironically, and tellingly, it was Senator Vandenberg—an erstwhile isolationist whose opposition the architects of the Marshall Plan had feared perhaps more than that of any other member of Congress—who arguably offered the most powerful testament to this point. In a rousing address to the Senate on March 1, 1948, he said that the Marshall Plan’s final text was “the final product of eight months of more intensive study by more devoted minds than I have ever known to concentrate upon any one objective in all my 20 years in Congress.”³⁸

The plan’s architects made their case to the whole country, not just Congress. Consider Harriman, who oversaw a committee that concluded, in November 1947, that the Marshall Plan could help convert an “old, compartmentalized pre-war Europe” to one “with a common economic market and strong political ties”:

After his committee’s report was finished, he flew all over the Midwest and West drumming up support in the months leading up to the vote in Congress. Flying great distances in an unpressurized DC-3, he adhered to what one of his companions considered a superhuman speaking schedule. Every day for several weeks he made three stops—in unglamorous cities like Fargo, Boise, and Walla Walla, bastions of isolationism.³⁹ 

Concluding Reflections

The Marshall Plan was not an unqualified success. Acheson warned President Truman in a February 16, 1950 memorandum that “unless vigorous steps are taken, the reduction and eventual termination of extraordinary foreign assistance” under its auspices would render Western European countries “unable to obtain basic necessities which we now supply, to an extent that will threaten their political stability”; the Marshall Plan proved unable to eliminate this so-called “dollar gap.”⁴⁰ Nor, as historian Simon Serfaty explains, did it significantly undermine “the electoral strength of the Communist parties in France and Italy.”⁴¹ It is important, as well, not to get carried away with the innumerable encomia, past and present, to the Marshall Plan’s generosity; in an address last May commemorating the undertaking’s 70^thanniversary, German Foreign Minister Sigmar Gabriel observed that “George Marshall’s policy primarily had nothing to with altruism. It was a forward-looking policy, and a policy the U.S. adopted in pursuit of its own interest.”⁴²

The point of registering these caveats is to safeguard the Marshall Plan from retrospective mythology, not to diminish its self-evident impact. Seven decades on, it is difficult, if not impossible, to convey the audacity of that undertaking. For starters, it “went against the instincts and traditions of foreign policy at the time. Never before had a victor rebuilt the conquered.”⁴³ The strategic logic that was implicit, if not inherent, in the Marshal Plan’s formulation—that the United States would be better positioned to steward the postwar era in partnership with a revitalized Europe—lay the foundation for the Transatlantic project, which, in turn, came to anchor the postwar order that has now prevailed for nearly three-quarters of a century. Its strategic innovation was rivaled only by its fiscal magnitude: “A $17 billion foreign assistance request was indeed an astounding amount. Even if stretched over several years, it constituted an enormous part of the federal budget. For fiscal year 1948, the estimated federal budget was $37.5 billion, which included $11.2 billion for national defense.”⁴⁴

The Marshall Plan exemplified the kind of “whole-of-government” initiative that contemporary policymakers so often tout yet so rarely seem capable of or interested in pursuing. The late Milton Katz, who served as one of its administrators, notes that “‘it represented a far-reaching consensus between [all parts of the American government]’ which rarely exists today.”⁴⁵ One might even say that it embodied not simply a whole-of-government approach, but a whole-of-country approach. Katz observes that the Marshall Plan

began with the understanding and support of the Department of State; other departments of the executive branch, represented in the interdepartmental committees; the president, not only in an official sense, but the president in a personal sense and the president in a political sense—it was his commitment; the Congress; civic and community leadership; organized farm groups; organized labor groups; organized industry groups; and the general public. And it was finally incorporated and published in a statute, available for all to see, and this whole process of explanation, challenge, and eventual decision was renewed each year in connection with the annual requests for new appropriations.⁴⁶

The Marshall Plan’s legacy suggests that the energy that is invested in a pursuit scales with the ambition it reflects. At a dinner commemorating its 15^thanniversary, John F. Kennedy declared that it “succeeded because it was conceived and operated on a scale commensurate with the task. It was an extraordinary reply to an extraordinary challenge.”⁴⁷ In the judgment of Robert Beisner, one of Acheson’s biographers, the Marshall Plan “succeeded because it was audacious. Leaders slashed through minutiae to achieve large purposes, the opposite of Acheson’s definition of a failure, when people met ‘big, bold, demanding problems with half measures, timorous and cramped’.”⁴⁸

The frequency with which U.S. policymakers invoke the Marshall Plan’s example testifies not only to the improbable confluence of circumstances that enabled its success, but also, it follows, to the strong unlikelihood of its replication. Political scientist Paul Miller cautions that policymakers “need to learn discerningly [from that effort], not replicate slavishly….no policy template from one era should be slapped down onto other problems in dissimilar circumstances.”⁴⁹ If the Marshall Plan does have a legacy, then, perhaps it is less prescriptive than aspirational: U.S. foreign policy can achieve great results when it matches the conclusions of strategy to the yearnings of humanity.