Advantages Of The Marshall Plan

The Marshall Plan

The importance and innovative force of the Marshall Plan lay, even beyond the scale of the aid offered, precisely in the fact that it constituted an endeavour to address the two facets of the problem at the same time, combining concession of contributions on the part of the USA with explicit coordination among the European countries, with a view to causing an upturn in trade and production in Europe – while Europe as a whole was to stand as a credible trading partner for the USA. Unlike all the plans drawn up at the time, or in the immediate aftermath of the war, the Marshall Plan made the supply of contributions conditional upon the drafting of a plan by all the European governments in concert – a plan for the distribu- tion and utilization of the funds. European response was immediate: less than six months after Marshall had formulated the idea of the plan in a celebrated speech at Harvard University in July 1947, the governments of western Europe, coming together in an organization that would subsequently become permanent, the Conference for European Economic Cooperation (CEEC), drew up and agreed upon a four-year plan. Thanks to the pains taken to achieve coordination, the proposal won the approval of the US Congress, and in April

It provided for a multilateral, intertemporal clearing for European trade,13 an extraor- dinary export-driven growth in production, in Germany and Italy in particular,14 and the liberalization of trade not only with the countries of Europe but well beyond, and in particular with the United States (see Table II 5.1). Thus trade in Europe did not recover at the expense of trade with the rest of the world. The Union was not a means to protect a non-competitive economic system, but a way to regain a degree of competitiveness sufficient for it to stand up to international competition without protective