Marshall Plan U.S. Department of Seal
Department of State

In the immediate post-World War II period, Europe remained ravaged by war and thus susceptible to exploitation by an internal and external communist threat. In a June 5, 1947, speech to the graduating class at Harvard University, Secretary of State George C. Marshall issued a call for a comprehensive program to rebuild Europe. Fanned by the fear of communist expansion and the rapid deterioration of European economies in the winter of 1946-47, Congress passed the Economic Cooperation Act in March 1948 and approved funding that would eventually rise to more than $12 billion for the rebuilding of western Europe. The Marshall Plan generated a resurgence of European industrialization and brought extensive investment into the region. It also was a stimulant to the U.S. economy by establishing markets for American goods. Although the participation of the Soviet Union and east European nations was an initial possibility, Soviet concern over potential U.S. economic domination of its east European satellites and Stalin's unwillingness to open up his secret society to Westerners doomed the idea. Furthermore, it is unlikely that the U.S. Congress would have been willing to fund the plan as generously as it did if aid also went to Soviet Bloc communist nations. Thus the Marshall Plan was applied solely to western Europe, precluding any measure of Soviet Bloc cooperation. Increasingly, the economic revival of western Europe, especially West Germany, was viewed suspiciously in Moscow. Economic historians have debated the precise impact of the Marshall Plan on western Europe, but these differing opinions do not detract from the fact that the Marshall Plan has been recognized as a great humanitarian effort. Secretary of State Marshall became the only general ever to receive a Nobel Prize for peace. The Marshall Plan also institutionalized and legitimized the concept of U.S. foreign aid programs, which have become a integral part of U.S. foreign policy.

Additional Reading:
Robert J. Donovan. The Second Victory: The Marshall Plan and the Post War Revival of Europe (Madison, 1988).
Michael J. Hogan. The Marshall Plan: America, Britain and the Reconstruction of Western Europ. (Cambridge, 1987).
Alan S, Milward. The Reconstruction of Western Europe, 1945-1951 (London: 1984).