The Marshall Plan

By Mike Kubic


In this article, Mike Kubic, a former correspondent of Newsweek, describes the impetus for and details of the
Marshall Plan. The Marshall Plan, also known as the European Recovery Plan (ERP), was an initiative by the
United States government to encourage economic development in Europe following the destruction caused by
World War II. Its creators believed that assisting Europe during this time would yield far-reaching benefits in the
form of global peace and security. As you read, take notes on the unique role America played in the post-war
recovery efforts.

World War II, which started with the German invasion
of Poland in September 1939, was a global struggle to
defeat Adolf Hitler’s Third Reich1
and its Axis allies,2
Italy and Japan. It was the most devastating conflict in
human history. By the time it ended in May 1945, the
fighting had ravaged the European continent and
claimed an estimated 75 million lives, both civilian
and military.
Yet this destructive, eight-year-long nightmare was
soon followed by an era of strong economic growth
that provided Europe with gleaming new industries
and infrastructure,3
increased its standard of living,
and set the continent on a path to a goal that used to
be considered impossible: a borderless unification.
This post-war “miracle” was made possible by
American leadership, particularly its key
component—American economic aid. The Marshall Plan, formally titled the United States’ European Recovery
Program (ERP), was the biggest and most successful political and economic venture ever undertaken in the Old

  1. Adolf Hitler was the German politician who, as the leader of Nazi Germany from 1934 to 1945, perpetrated
    the Holocaust. The Third Reich was the term used to describe the Nazi regime during Hitler’s period of rule.
  2. The Axis allies were Germany, Italy, Japan, Hungary, Romania, and Bulgaria. They fought against the Allied
    forces, which included the United States.
  3. “Infrastructure” refers to various structures, systems, and facilities that serve a particular continent or
    country. Examples include public transportation and utilities.
  4. “The Old World” refers to Africa, Europe, and Asia, regarded collectively as the part of the world known to
    Europeans before contact with the Americans.
    The War’s Ruinous Toll
    Speedy recovery from the war’s enormous wreckage was beyond anyone’s imagination when the armies of the
    victorious Allies—the United States, Britain, the USSR, and France—conquered Germany and fired the last shot.
    The war’s survivors, including millions of civilians, prisoners of war, inmates of German concentration camps,
    slave laborers, and refugees from Eastern Europe faced unprecedented5
    and misery.
    [5] The air raids7
    conducted by American and British bombers, heavy artillery, tanks, and street fighting had
    reduced large German cities to heaps of rubble. In Western Europe alone, five million houses and apartments
    were demolished. The destruction of power plants, railroads, bridges, and docks had all but halted Europe’s
    industry, commerce, and food production, and the lack of equipment and raw materials8 made the continent’s
    reconstruction painfully slow.
    Three years after the war ended, Europe’s industrial production was still below the pre-war level, exports were
    lagging, and food was in such short supply that most Europeans were surviving on 1,500 calories a day.
    The U.S. Takes Charge
    To ease this massive hardship, the United States shipped 16.5 million tons of food to Europe and Japan in 1945
    and 1946. Though this was one-sixth of America’s own food supply, it was not enough to prevent hunger riots
    and chaos from breaking out in the impoverished Germany. The crisis only took a turn for the better in June of
    1947, when the U.S. called on the Europeans to work together and promised to help them in restoring their
    The historic proposal was made by George Marshall, the U.S. Secretary of State and former Chief of Staff of the
    U.S. Army. The British Prime Minister Winston Churchill called Marshall the “organizer of victory” in WWII. In a
    commencement address delivered on the steps of Memorial Church in Harvard Yard, Marshall urged the
    nations of the Old World to collectively create their own recovery plan. Speaking about the role of his country,
    he added that “It is logical that the United States should do whatever it is able to do to assist in the return of
    normal economic health in the world, without which there can be no political stability and no assured peace.”
    The war-weary and disorganized Europeans couldn’t meet Marshall’s request by designing their own blueprint9
    for recovery. But, in short order, 17 countries (Austria, Belgium, Denmark, France, West Germany, United
    Kingdom, Greece, Iceland, Ireland, Italy, Luxembourg, the Netherlands, Norway, Sweden, Switzerland and
    Turkey) eagerly embraced a plan prepared by the U.S. Department of State.
  5. Unprecedented (adjective) never done, seen, or known before
  6. Privation (noun) a state in which things that are essential for the well-being of humans are scarce or
  7. An air raid is an attack in which bombs were dropped from an aircraft onto a target on the ground.
  8. “Raw materials” refers to the basic materials from which a product is made. For example, the raw materials
    that go into making a cake might consist of flour, eggs, sugar, etc.
  9. plan
    [10] Authorized by Congress as the “Act to Promote World Peace and the Overall Welfare, National Interest, and
    Foreign Policy of the United States,” the Marshall plan required participating nations—including the U.S.—to
    ease cross-border trade; do away with red tape10 and many regulations; increase productivity and labor union
    membership; and adopt modern business procedures.
    To facilitate these far-reaching changes, the U.S. divided among its wartime allies $13 billion (approximately
    $130 billion in current dollar value). Most of the money was earmarked11 for the biggest industrial nations
    because of their importance for the region’s recovery, but another important benchmark was each nation’s
    contribution to the defeat of Hitler’s Germany. The recipients of the greatest portion of the Marshall Plan
    money were the United Kingdom (about 26% of the total), and France (18%). West Germany—the biggest part of
    which was occupied by the armies of the U.S., Britain, and France—received 11%.
    The plan was in operation for four years beginning in April 1948, and provided the continent with $3.4 billion in
    raw materials and semi-manufactured products; $3.2 billion in food, feed, and fertilizer; $1.9 billion in
    machines, vehicles, and equipment; and $1.6 billion in fuel—almost all of which was provided by the U.S.
    The result was the fastest period of growth ever observed in European history. In June 1948, Germany replaced
    its nearly worthless currency with a new German mark12 that almost overnight unleashed vigorous13 economic
    activity. The store windows that had been empty or boarded over for years began displaying merchandise that
    had been unavailable since the start of the war. The wartime food rationing ended, employment picked up, and
    Industrial production increased by 35% within two years. Farm output rose substantially above the pre-war
    levels and vanquished14 the widespread starvation during and after the war.
    Western Europe—the countries that had joined the Marshall plan—went on to experience two decades of
    record economic growth and enhanced standard of living.
    The Plan’s Main Problem
    [15] The Marshall Plan’s success was marred15 by only one significant failure: it was rejected by the Soviet Union,16
    whose leader, Josef Stalin, regarded cooperation with Western democracies as a threat to the totalitarian17 rule
    of his Communist18 party. Aware of Stalin’s suspicions and antagonism,19 Marshall made a special effort to
  10. A slang term to describe excessive bureaucracy or unreasonable adherence to rules and formalities.
  11. designated for a particular purpose
  12. The basic monetary unit of Germany prior to the introduction of the Euro.
  13. Vigorous (adjective) strong, healthy, and full of energy
  14. Vanquish (verb) to defeat thoroughly
  15. Mar (verb) to impair the quality of; to spoil
  16. The Soviet Union was a socialist state on the Eurasian continent that existed between 1922 and 1991. It
    was characterized by a highly centralized government that was ruled by the Communist Party.
  17. of or relating to a system of government that is centralized, featuring a ruler who has total power
  18. Under Stalin’s reign, the Communist party implemented policies of widespread terror-based control by the
    government, rapid industrialization, the promotion of class conflict, and the unrestrained use of state
  19. Antagonism (noun) hatred, dislike; hostility or opposition
    emphasize that the U.S. aid was being offered to all Europe. “Our policy is not directed against any country, but
    against hunger, poverty, desperation and chaos,” he said in his Harvard speech.
    His offer held strong appeal for the Eastern European countries that, at the end of war, were occupied by the
    Red Army20 and came under Soviet influence. But when one of them, Czechoslovakia, was about to apply for
    membership, Stalin summoned its foreign minister to Moscow and ordered him to cancel the move.
    Progress Toward European Union
    The lack of participation among Eastern European nations was a setback for the emerging U.S. efforts to
    prevent the spread of communist dictatorships and Soviet influence, but it did not impede21 economic and
    political progress in Western Europe. By reducing the post-war austerity22 measures, the influence of
    communist parties, and popular discontent,23 the Marshall plan strengthened political stability that encouraged
    ever-closer European integration and alliance with the U.S. The process was highlighted by two historic steps:
    • In 1948, members of the Marshall Plan joined the United States in forming the Organization for
    European Economic Cooperation, a master financial-aid- coordinating agency.
    • In 1951, Belgium, France, the Netherlands, West Germany, Italy and Luxembourg established the
    European Coal and Steel Community, the first international organization subject to the combined
    authority of its members.
    In 1993, this unprecedented progress climaxed in the creation of the European Union – a body that today
    includes 27 member states with a population of more than 430 million. Even after Britain’s withdrawal from the
    E.U. in August 2016, it continues to provide the best assurance that Europe will never again launch another
    World War.
    George Marshall’s central role in bringing about the European recovery was formally recognized In 1953, when
    he received the Nobel Peace Prize, the world’s most prestigious award, which is given annually to those who
    have “done the most or the best work for fraternity24 between nations.”
    © 2016. The Marshall Plan by CommonLit is licensed under CC BY-NC-SA 2.0.
    Unless otherwise noted, this content is licensed under the CC BY-NC-SA 4.0 license
  20. The Red Army was the army and air force of the USSR (Union of Soviet Socialist Republics).
  21. Impede (verb) to delay or prevent; to hinder
  22. Austerity (noun) conditions characterized by severity, strictness, and the avoidance of indulgence
  23. Discontent (noun) dissatisfaction with something; lack of contentment; unhappiness
  24. Fraternity (noun) the state or feeling of friendship and mutual support within a group; brotherhood
    Discussion Questions
    Directions: Brainstorm your answers to the following questions in the space provided. Be prepared to share
    your original ideas in a class discussion.
  25. Why does the author find it important to describe how the financial aid was apportioned among
    European nations (Paragraph 11)? Do you think the money and resources were allocated fairly?
  26. Based on the information presented in the text and your knowledge of current events, how do you
    think the federal government’s approach to foreign policy has changed since the Marshall Plan? Do
    you think this is a positive or negative change?
  27. What do you find to be more effective in underscoring the disadvantaged state of Europe following
    the war: descriptions of the challenges individuals faced or information about the damage done to
    national industries and economies? Why?
  28. The author stresses the necessity of aid for Europe, given the “unprecedented privation and
    misery” (Paragraph 4) that resulted from WWII. In your opinion, given the context of this article,
    how are we changed by war, both as individuals and as members of larger societies? Cite evidence
    from this text, your own experience, and other literature, art, or history in your answer.
  29. In his speech at Harvard Yard, George Marshall emphasized the role the United States must play in
    the recovery of Europe for the greater good. In the context of this article, what makes America
    unique? Cite evidence from this text, your own experience, and other literature, art, or history in
    your answer.
  30. According to the text, the Marshall Plan was one of the most effective endeavors in foreign policy in
    American history. In the context of this article, how can individuals – or governments – create
    change on a global scale? Cite evidence from this text, your own experience, and other literature,
    art, or history in your answer.