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[[ගොනුව:US-MarshallPlanAid-Logo.svg|thumb|Labeling used on aid packages]]
The '''Marshall Plan ''' (officially the '''European Recovery Program''', '''ERP''') was the primary program, 1947–51, of the [[United States]] for rebuilding and creating a stronger economic foundation for the countries of Europe. The initiative was named for [[United States Secretary of State|Secreta(contracted; show full)eived many offers from Western European nations to trade food for desperately needed coal and steel. The Allies were however not willing to let the Germans trade.<ref>Nicholas Balabkins, ''"Germany Under Direct Controls: Economic Aspects of Industrial Disarmament 1945 - 1948"'', [[Rutgers University Press]], 1964 p. 125</ref>

In addition, the power and popularity of indigenous communist parties in several Western European states worried the United States. In both 
Franceප්‍රංශය and Italy, the crisis of the postwar era had provided fuel for their Communist Parties, which had become well organized in the resistance movements of the war. These parties had seen significant electoral success in the postwar elections. Though today many historians feel the threat of Franceප්‍රංශය and Italy falling to the communists was remote,<ref>Gaddis, ''We Now Know''.</ref> it was regarded as a very real possibility by American policy makers at the time.

(contracted; show full) by the Soviets in their occupied zone.<ref name="miller16">{{Harvnb|Miller|2000|p=16}}</ref><ref name="wettig116"/> During the Moscow session of the Council of Foreign Ministers in March and April 1947, it became clear that decisions on a future central government and an eventual final peace treaty with a re-formed Germany depended on solving economic issues.<ref name="wettig116">{{Harvnb|Wettig|2008|p=116}}</ref>

The United States, Britain and 
Franceප්‍රංශය sought a common basis for reconstruction and long-term demilitarization; Soviet-bloc countries were welcome to participate but Marshall thought their involvement was unlikely because they would have to set aside secrecy and disclose economic records to join.<ref>Nash, Gary B., Julie Roy Jeffrey, John R. Howe, Peter J. Frederick, Allen F. Davis, Allan M. Winkler, Charlene Mires, and Carla Gardina Pestana. The American People, Concise Edition Creating a Nation and a Society, Combined Volume (6th Editio(contracted; show full)ris, rejecting the plan.<ref name="wettig139">{{Harvnb|Wettig|2008|p=139}}</ref> Thereafter, statements were made suggesting a future confrontation with the west, calling the United States both a "fascizing" power and the "center of worldwide reaction and anti-Soviet activity", with all countries aligned with it being branded enemies.<ref name="wettig139"/> The Soviets also then blamed the United States for communist losses in elections in Belgium, 
Franceප්‍රංශය and Italy months earlier, in the spring of 1947.<ref name="wettig139"/> It claimed that "marshallization" must be resisted and prevented by any means, and that French and Italian communist parties were to take maximum efforts to sabotage the implementation of the Plan.<ref name="wettig139"/> In addition, western embassies in Moscow were isolated, with their personnel being denied contact with Soviet officials.<ref name="wettig139"/>

(contracted; show full)ted by the ruling clique of the American imperialists" which have embarked upon the "enslavement of the weakened capitalist countries of Europe".<ref name="wettig140">{{Harvnb|Wettig|2008|p=140}}</ref> Parties were to struggle against the U.S. presence in Europe by any means necessary, including sabotage.<ref name="wettig146"/> It further claimed that "reactionary imperialist elements throughout the world, particularly in the U.S.A., in Britain and 
Franceප්‍රංශය, had put particular hope on Germany and Japan, primarily on Hitlerite Germany—first as a force most capable of striking a blow at the Soviet Union".<ref name="wettig142">{{Harvnb|Wettig|2008|p=142}}</ref>

Referring to the Eastern Bloc, it stated that "the Red Army's liberating role was complemented by an upsurge of the freedom-loving peoples' liberation struggle against the fascist predators and their hirelings".<ref name="wettig142"/> It argued that "the bosses of Wall Street" were "tak[ing] the place of Germany, Japan and Italy".<ref name="wettig142"/> The Marshall plan was described as "the American plan for the enslavement of Europe".<ref name="wettig142"/> It described the world now breaking down "into basically two camps—the imperialist and antidemocratic camp on the one hand, and the antiimperialist and democratic camp on the other".<ref name="wettig142"/>

Although the Eastern Bloc countries except Czechoslovakia had immediately rejected Marshall Plan aid, Eastern Bloc communist parties were blamed for permitting even minor influence by non-communists in their respective countries during the run up to the Marshall Plan.<ref name="wettig148"/> The meeting's chair, Andreia Zhadanov, who was in permanent radio contact with the Kremlin from whom he received instructions,<ref name="wettig140"/> also castigated communist parties in Franceප්‍රංශය and Italy for collaboration with those countries' domestic agendas.<ref name="wettig145">{{Harvnb|Wettig|2008|p=145}}</ref> Zhadanov warned that if they continued to fail to maintain international contact with Moscow to consult on all matters, "extremely harmful consequences for the development of the brother parties' work" would result.<ref name="wettig145"/>

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== Negotiations ==

Turning the plan into reality required negotiations among the participating nations, and to get the plan through the [[United States Congress]]. Sixteen nations met in Paris to determine what form the American aid would take, and how it would be divided. The negotiations were long and complex, with each nation having its own interests. 
France'sප්‍රංශයේ major concern was that Germany not be rebuilt to its previous threatening power. The [[Benelux]] countries, despite also suffering under the Nazis, had long been closely linked to the German economy and felt their prosperity depended on its revival. The Scandinavian nations, especially [[Sweden]], insisted that their long-standing trading relationships with the [[Eastern bloc]] nations not be disrupted and that their neutrality not be infringed. The United Kingdom insisted on special status, concerned that if it were treated equally with the devastated continental powers it would receive virtually no aid. The Americans were pushing the importance of free trade and European unity to form a bulwark against communism. The Truman administration, represented by [[William L. Clayton]], promised the Europeans that they would be free to structure the plan themselves, but the administration also reminded the Europeans that implementation depended on the plan's passage through Congress. A majority of Congress members were committed to free trade and European integration, and were hesitant to spend too much of the money on Germany.<ref>Cini, p.24 in Schain</ref> However, before the Marshall Plan was in effect, Franceප්‍රංශය, Austria, and Italy needed immediate aid. On December 17, 1947, the United States agreed to give $40 million to Franceප්‍රංශය, Austria, China, and Italy.<ref>Sorel, Eliot, and Pier Carlo Padoan. The Marshall Plan: Lessons Learned for the 21st Century. Paris: OECD, 2008. 15-16. Print.</ref>

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Truman signed the Marshall Plan into law on April 3, 1948, establishing the [[Economic Cooperation Administration]] (ECA) to administer the program. ECA was headed by economic cooperation administrator [[Paul G. Hoffman]]. In the same year, the participating countries (Austria, [[Belgium]], Denmark, 
Franceප්‍රංශය, West Germany, the United Kingdom, Greece, [[Iceland]], Ireland, Italy, [[Luxembourg]], the [[Netherlands]], Norway, Sweden, [[Switzerland]], Turkey, and the United States) signed an accord establishing a master financial-aid-coordinating agency, the [[Organization for European Economic Cooperation]] (later called the Organization for Economic Cooperation and Development, [[OECD]]), which was headed by Frenchman [[Robert Marjolin]].

== Implementation ==

[[ගොනුව:Marshall plan page 1.jpg|thumb|First page of the Marshall Plan]]

The first substantial aid went to [[Greece]] and [[Turkey]] in January 1947, which were seen as being on the front lines of the battle against communist expansion and were already being aided under the [[Truman Doctrine]]. Initially the UK had supported the anti-communist factions in those countries, but due to its dire economic condition it requested the U.S. to continue its efforts. The ECA formally began operation in July 1948.

Its official [[mission statement]] was to give a boost to the European economy: to promote European production, to bolster European currency, and to facilitate international trade, especially with the United States, whose economic interest required Europe to become wealthy enough to import U.S. goods. Another unofficial goal of ECA (and of the Marshall Plan) was the containment of growing Soviet influence in Europe, evident especially in the growing strength of [[communist party|communist parties]] in Czechoslovakia, Franceප්‍රංශය, and Italy.

The Marshall Plan money was transferred to the governments of the European nations. The funds were jointly administered by the local governments and the ECA. Each European [[capital (political)|capital]] had an ECA envoy, generally a prominent American businessman, who would advise on the process. The cooperative allocation of funds was encouraged, and panels of government, business, and labor leaders were convened to examine the economy and see where aid was needed.

(contracted; show full)es. This process has continued to this day in the guise of the state owned [[KfW]] bank. The Special Fund, then supervised by the Federal Economics Ministry, was worth over DM 10 billion in 1971. In 1997 it was worth DM 23 billion. Through the revolving loan system, the Fund had by the end of 1995 made low-interest loans to German citizens amounting to around DM 140 billion. The other 40% of the counterpart funds were used to pay down the debt, stabilize the currency, or invest in non-industrial projects. 
Franceප්‍රංශය made the most extensive use of counterpart funds, using them to reduce the budget deficit. In Franceප්‍රංශය, and most other countries, the counterpart fund money was absorbed into general government revenues, and not recycled as in Germany.{{Citation needed|date=January 2010}}

(contracted; show full)alent to 25% of the pre-war production level.<ref name="autogenerated3">[http://www.time.com/time/magazine/article/0,9171,934360,00.html "Cornerstone of Steel"], ''[[Time (magazine)|]]'' magazine, January 21, 1946</ref> The UK, in whose occupation zone most of the steel production was located, had argued for a more limited capacity reduction by placing the production ceiling at 12 million tons of steel per year, but had to submit to the will of the U.S., 
Franceප්‍රංශය and the Soviet Union (which had argued for a 3 million ton limit). Steel plants thus made redundant were to be dismantled. Germany was to be reduced to the standard of life it had known at the height of the [[Great depression]] (1932).<ref name="autogenerated1">[http://www.time.com/time/magazine/article/0,9171,852764,00.html Cost of Defeat], ''[[Time (magazine)|]]'' magazine, April 8, 1946</ref> Car production was set to 10% of pre-war levels, etc.<ref>[http:(contracted; show full)ndustrial installations from the west began on March 31, 1946. Under the terms of the agreement the Soviet Union would in return ship raw materials such as food and timber to the western zones. In view of the Soviet failure to do so the U.S. temporarily halted shipments east (although they were never resumed), although it was later shown that although utilized for cold war propaganda reasons the main reason for halting shipments east was not the behavior of the USSR but rather the recalcitrant behavior of 
Franceප්‍රංශය.<ref>John Gimbel, "The American Reparations Stop in Germany: An Essay on the Political Uses of History"</ref> Examples of material received by the USSR were
(contracted; show full)ecovered in the communist period, resulting in the formation of the [[shortage economy|shortage economies]] and a gap in wealth between East and West. Finland, which did not join the Marshall Plan and which was required to give large reparations to the USSR, saw its economy recover to pre-war levels in 1947.<ref>{{cite web|url=http://www.nationsencyclopedia.com/Europe/Finland-ECONOMY.html |title=Economy&nbsp;— Finland |publisher=Nationsencyclopedia.com |date= |accessdate=2009-02-01}}</ref> 
Franceප්‍රංශය, which received billions of dollars through the Marshall Plan, similarly saw its average income per person return to almost pre-war level by 1949.<ref>{{cite book|url=http://books.google.co.uk/books?hl=en&lr=&id=kGCfmmlGtPEC&oi=fnd&pg=PA189&dq=%22marshall+plan%22+france+recover+pre-war+&ots=Kx_HrsmbWs&sig=EMSTnL2S6vwHCrzOYiQJJDNCpGw#PPA202,M1|title=Postwar Economic Reconstruction and Lessons for the East Today|last=De Long|first=J.|page=202|year=1993|chapter=The Marshall P(contracted; show full)e [[Historical revisionism|revisionist]] school, such as [[Walter LaFeber]], during the 1960s and 1970s. They argued that the plan was American economic [[imperialism]], and that it was an attempt to gain control over Western Europe just as the Soviets controlled Eastern Europe. In a review of West Germany's economy from 1945 to 1951, German analyst [[Werner Abelshauser]] concluded that "foreign aid was not crucial in starting the recovery or in keeping it going". The economic recoveries of 
Franceප්‍රංශය, Italy, and Belgium, Cowen found, also predated the flow of U.S. aid. Belgium, the country that relied earliest and most heavily on free market economic policies after its liberation in 1944, experienced the fastest recovery and avoided the severe housing and food shortages seen in the rest of continental Europe.<ref>{{cite web|url=http://www.cato.org/research/articles/vasquez-030509.html |title=A Marshall Plan for Iraq? |publisher=Cato.org |date=2003-05-09 |accessdate=2009-02-01}}</ref>

(contracted; show full)e, [[Alberto Alesina]] and Beatrice Weder, summing up economic literature on foreign aid and corruption, find that aid is primarily used wastefully and self-servingly by government officials, and ends up increasing governmental corruption.<ref>Alesina and Weder, pp.1126–1137</ref> This policy of promoting corrupt government is then attributed back to the initial impetus of the Marshall Plan.<ref>Tucker, 15:9</ref>

[[Noam Chomsky]] wrote that the amount of American dollars given to 
Franceප්‍රංශය and the [[Netherlands]] equaled the funds these countries used to finance their military forces in southeast Asia. The Marshall Plan was said to have "set the stage for large amounts of private U.S. investment in Europe, establishing the basis for modern [[Multinational corporation|transnational corporations]]".<ref>Chomsky, p.9</ref> Other criticism of the Marshall Plan stemmed from reports that the [[Netherlands]] used a significant portion of the aid it received to re-conquer Indon(contracted; show full)
* Tucker, Jeffrey, "The Marshall Plan Myth" The Free Market 15:9 (Sept 1997)
* {{Citation|last=Turner|first=Henry Ashby|title=The Two Germanies Since 1945: East and West|publisher=Yale University Press|year=1987|isbn=0300038658}}
* Van Meter Crabb, Cecil, American foreign policy in the nuclear age, [[Harper & Row]], New York, 1965
* von Mises, Ludwig, "Profit and Loss" presented to the Mont Pèlerin Society held in Beauvallon, 
Franceප්‍රංශය, September 9 to 16, 1951; reprinted in ''Planning for Freedom'', South Holland, Ill., Libertarian Press, 1952 {{cite web|url=http://www.mises.org/story/2321 |title=Profit and Loss&nbsp;— Ludwig von Mises&nbsp;— Mises Institute |publisher=Mises.org |date= |accessdate=2009-08-18}}
* {{Citation|last=Wettig|first=Gerhard|title=Stalin and the Cold War in Europe|publisher=[[Rowman & Littlefield]]|year=2008|isbn=0742555429}}
* Woods, Thomas E., ''[[The Politically Incorrect Guide to American History]]'', . ISBN 0-89526-047-6

== Further reading ==
* Agnew, John and Entrikin, J. Nicholas eds. ''The Marshall Plan Today: Model and Metaphor'' Routledge. (2004) [http://www.questia.com/PM.qst?a=o&d=108516906 online version]
* Arkes, Hadley. ''Bureaucracy, the Marshall Plan, and the National Interest'' (1972).
* Behrman, Greg, ''The Most Noble Adventure: The Marshall Plan and the Time When America Helped Save Europe'' (2007) ISBN 0-7432-8263-9
* Bonds, John Bledsoe. ''Bipartisan Strategy: Selling the Marshall Plan'' (2002) [http://www.questia.com/PM.qst?a=o&d=102124797 online version]
* Esposito, Chiarella. ''America's Feeble Weapon: Funding the Marshall Plan in Franceප්‍රංශය and Italy, 1948–1950'' (1994) [http://www.questia.com/library/book/americas-feeble-weapon-funding-the-marshall-plan-in-france-and-italy-1948-1950-by-chiarella-esposito.jsp online version]
* Djelic, Marie-Laure A. ''Exporting the American Model: The Post-War Transformation of European Business '' (1998) [http://www.questia.com/library/book/exporting-the-american-model-the-post-war-transformation-of-european-business-by-marie-laure-a-djelic.jsp online version]
(contracted; show full)hall Plan as Tragedy", comment on Michael Cox and Caroline Kennedy-Pipe, "The Tragedy of American Diplomacy? Rethinking the Marshall Plan", both published in the Journal of Cold War Studies, vol. 7, no. 1 (Winter 2005) ([http://www.polisci.ucla.edu/faculty/trachtenberg/cv/jcws(marshall%20plan).pdf text of comment on pdf]) ([http://www.polisci.ucla.edu/faculty/trachtenberg/cv/jcws(marshall%20orig).pdf text of original article on pdf])
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