Marshall Plan refers to a European Recovery Program that was specially designed to help rehabilitate the economies of southern and western European countries. The program designed in April 1948-december 1951, covered 17 European countries and aimed at creating stable economic conditions and ensures that democratic institutions thrive.
The US had its own fears including the fear that unemployment, poverty and dislocation of people following the World War II would easily cause a reinforcement of communist parties in Western Europe. George C. Marshall, the Secretary of State, advanced self-help programs in June 5th 1947. The program was to be fully financed by the United States.
The program was also established to ensure successful economic reconstruction across Europe. A committee was therefore formed to represent 16 European countries covered by the plan. Additionally, the program was signed into law in April 3rd 1948 by President Harry S. Truman.
The program aided the countries including countries covered by the Soviet Union. However, the Soviets withdrew from the program and later influenced European countries to do the same. Even so, Belgium, Denmark, Greece, France, Ireland, Iceland, Austria, Norway, Netherlands, Portugal, turkey, Sweden, Switzerland, western Germany, Italy, Luxembourg and the united kingdom participated fully in the plan.
A special bureau, Economic Cooperation Administration was also created under Paul G. Hoffman. The bureau ensured successful distribution of more $13billion as economic aid. The money was used to restore agricultural production, industrial production, expand trade and establish financial stability in the countries.
Additionally, Marshall Plan ensured that direct grants in form of loans were distributed across the countries. The United Kingdom and France ensured that there was proper coordination and participation by European countries. A four year recovery program was therefore established by the European Economic Cooperation.
Marshall Plan became very successful and as a result, all the western European countries had a lot to benefit from. They witnessed an increment in their gross national products during the period. Additionally, the plan contributed enormously to renewal of different industries including steel and engineering industries in Western Europe.
Truman on the other hand extended the plan to ensure that developing countries across the globe benefited from it. A Point Four Program was established to facilitate the success of Marshall Plan in less developed countries.
However, historians and more specifically revisionist historians challenges the plan, that it only represented American altruism. They have also over the past years argued that export of US dollars to European countries only kept the US from going into depression and backsliding. This is because the step provides a stable or a long term market for US capital products. The plan according to the historians favored and allowed the United States to reconstruct European economy only in the eyes of US economy.
Marshall Plan enhanced economic integration between different European countries. It also enhanced federalism and created a mixture of private economy and public organization like the one witnessed in the US economy. The reorganization of economy in Europe thereafter provided a very congenial environment for investment the United States than in European Countries. The Marshal Plan was therefore highly profitable to the United States.
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