Show Marshall Plan, 1948In 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 1946–1947, Congress passed the Economic Cooperation Act in March 1948 and approved funding that would eventually rise to over $12 billion for the rebuilding of Western Europe.  First page of the Marshall Plan The Marshall Plan generated a resurgence of European industrialization and brought extensive investment into the region. It was also 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 Eastern 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. Abstract Europe's post-World War II experience with the Marshall Plan is frequently invoked by advocates of Western aid for Eastern Europe and the former USSR. Yet previous analyses of the Marshall Plan are uniformly sceptical that it had important economic effects. This paper finds, in contrast, that the Marshall Plan contributed importantly to Europe's recovery from World War II. Strikingly, however, the obvious channels through which the Marshall Plan could have affected recovery -- stimulating investment, augmenting imports, and financing infra-structure repair -- were relatively unimportant. Rather, post-war Europe was suffering a marketing crisis, in which political instability, shortages of consumer goods and fears of financial chaos led producers to hoard commodities and workers to limit effort. The Marshall Plan solved this marketing crisis by facilitating the restoration of financial stability and the liberalization of production and prices; this was its crucial role. These conclusions have obvious implications for Western aid to Eastern Europe and the successor states of the former USSR. Journal Information In 2005, Economic Policy celebrates 20 years at the forefront of economic policy debate. Over the two decades since its inception, Economic Policy has earned a reputation around the world for publishing the best, cutting-edge analyses of a wide range of key economic issues as they emerge. Economic Policy has published some of the most cited studies anywhere in the world - on financial crises, deregulation, unions, the Euro and other pressing international topics. Articles in Economic Policy are specifically commissioned from first-class economists and experts in the policy field all over the world. Their brief is to illuminate topical policy issues by combining the insights of modern economics with the best available evidence. The presentation is incisive and written in plain language accessible to a wide range of participants in the policy debate. Publisher Information Oxford University Press is a department of the University of Oxford. It furthers the University's objective of excellence in research, scholarship, and education by publishing worldwide. OUP is the world's largest university press with the widest global presence. It currently publishes more than 6,000 new publications a year, has offices in around fifty countries, and employs more than 5,500 people worldwide. It has become familiar to millions through a diverse publishing program that includes scholarly works in all academic disciplines, bibles, music, school and college textbooks, business books, dictionaries and reference books, and academic journals. Rights & Usage This item is part of a JSTOR Collection. What did the Marshall Plan result from?The Marshall Plan was proposed in a speech by Secretary of State George Marshall at Harvard University on June 5, 1947, in response to the critical political, social, and economic conditions in which Europe found itself at that time.
What are two consequences of the Marshall Plan?Consequence: Eastern European countries didn't benefit from Marshall Plan. USA set itself up in direct opposition to the communist Soviet Union and invited other nations to join it. Stalin's suspicions grew he thought he had evidence the USA was trying to destroy Soviet Union.
What did the Marshall Plan do?The Marshall Plan gave more than $13 billion in aid to European nations—including its World War II enemies, Germany and Italy—and was crucial in revitalizing their post-war economies. By the time U.S. funding ended, in 1951, the economies of all the European recipients had surpassed prewar levels.
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