Two years after the defeat
of Nazi Germany, U.S. Secretary of State George C. Marshall returned home
from a visit to Europe and reported, "The recovery of Europe is far slower
than had been expected. Disintegrating forces are becoming evident. The
patient is sinking while the doctors deliberate..." Much of Europe lay in
ruins. People faced shortages of housing, food, raw materials such as coal,
and also lacked the money to pay for imports. The survival of Europe was at
stake. When asked to deliver the 1947 commencement address at Harvard
University, Marshall accepted the invitation and used the opportunity to
suggest an economic recovery plan to revitalize Europe.
Mr. President, Dr. Conant, members of the Board of
Overseers, Ladies and Gentlemen:
I'm profoundly grateful and touched by the great
distinction and honor and great compliment accorded me by the
authorities of Harvard this morning. I'm overwhelmed, as a matter of
fact, and I'm rather fearful of my inability to maintain such a high
rating as you've been generous enough to accord to me. In these historic
and lovely surroundings, this perfect day, and this very wonderful
assembly, it is a tremendously impressive thing to an individual in my
position.
But to speak more seriously, I need not tell you that
the world situation is very serious. That must be apparent to all
intelligent people. I think one difficulty is that the problem is one of
such enormous complexity that the very mass of facts presented to the
public by press and radio make it exceedingly difficult for the man in
the street to reach a clear appraisement of the situation. Furthermore,
the people of this country are distant from the troubled areas of the
earth and it is hard for them to comprehend the plight and consequent
reactions of the long-suffering peoples, and the effect of those
reactions on their governments in connection with our efforts to promote
peace in the world.
In considering the requirements for the
rehabilitation of Europe, the physical loss of life, the visible
destruction of cities, factories, mines, and railroads was correctly
estimated, but it has become obvious during recent months that this
visible destruction was probably less serious than the dislocation of
the entire fabric of European economy. For the past ten years conditions
have been abnormal. The feverish preparation for war and the more
feverish maintenance of the war effort engulfed all aspects of national
economies. Machinery has fallen into disrepair or is entirely obsolete.
Under the arbitrary and destructive Nazi rule, virtually every possible
enterprise was geared into the German war machine.
Long-standing commercial ties, private institutions,
banks, insurance companies, and shipping companies disappeared through
loss of capital, absorption through nationalization, or by simple
destruction. In many countries, confidence in the local currency has
been severely shaken. The breakdown of the business structure of Europe
during the war was complete. Recovery has been seriously retarded by the
fact that two years after the close of hostilities a peace settlement
with Germany and Austria has not been agreed upon. But even given a more
prompt solution of these difficult problems, the rehabilitation of the
economic structure of Europe quite evidently will require a much longer
time and greater effort than has been foreseen.
There is a phase of this matter which is both
interesting and serious. The farmer has always produced the foodstuffs
to exchange with the city dweller for the other necessities of life.
This division of labor is the basis of modern civilization. At the
present time it is threatened with breakdown. The town and city
industries are not producing adequate goods to exchange with the
food-producing farmer. Raw materials and fuel are in short supply.
Machinery is lacking or worn out. The farmer or the peasant cannot find
the goods for sale which he desires to purchase. So the sale of his farm
produce for money which he cannot use seems to him an unprofitable
transaction. He, therefore, has withdrawn many fields from crop
cultivation and is using them for grazing. He feeds more grain to stock
and finds for himself and his family an ample supply of food, however
short he may be on clothing and the other ordinary gadgets of
civilization. Meanwhile, people in the cities are short of food and
fuel, and in some places approaching the starvation levels. So the
governments are forced to use their foreign money and credits to procure
these necessities abroad. This process exhausts funds which are urgently
needed for reconstruction. Thus a very serious situation is rapidly
developing which bodes no good for the world. The modern system of the
division of labor upon which the exchange of products is based is in
danger of breaking down.
The truth of the matter is that Europe's requirements
for the next three or four years of foreign food and other essential
products - principally from America - are so much greater than her
present ability to pay that she must have substantial additional help or
face economic, social, and political deterioration of a very grave
character.
The remedy lies in breaking the vicious circle and
restoring the confidence of the European people in the economic future
of their own countries and of Europe as a whole. The manufacturer and
the farmer throughout wide areas must be able and willing to exchange
their product for currencies, the continuing value of which is not open
to question.
Aside from the demoralizing effect on the world at
large and the possibilities of disturbances arising as a result of the
desperation of the people concerned, the consequences to the economy of
the United States should be apparent to all. 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.
Our policy is directed not against any country or
doctrine but against hunger, poverty, desperation, and chaos. Its
purpose should be the revival of a working economy in the world so as to
permit the emergence of political and social conditions in which free
institutions can exist. Such assistance, I am convinced, must not be on
a piecemeal basis as various crises develop. Any assistance that this
Government may render in the future should provide a cure rather than a
mere palliative. Any government that is willing to assist in the task of
recovery will find full cooperation, I am sure, on the part of the
United States Government. Any government which maneuvers to block the
recovery of other countries cannot expect help from us. Furthermore,
governments, political parties, or groups which seek to perpetuate human
misery in order to profit therefrom politically or otherwise will
encounter the opposition of the United States.
It is already evident that, before the United States
Government can proceed much further in its efforts to alleviate the
situation and help start the European world on its way to recovery,
there must be some agreement among the countries of Europe as to the
requirements of the situation and the part those countries themselves
will take in order to give proper effect to whatever action might be
undertaken by this Government. It would be neither fitting nor
efficacious for this Government to undertake to draw up unilaterally a
program designed to place Europe on its feet economically. This is the
business of the Europeans. The initiative, I think, must come from
Europe. The role of this country should consist of friendly aid in the
drafting of a European program and of later support of such a program so
far as it may be practical for us to do so. The program should be a
joint one, agreed to by a number, if not all, European nations.
An essential part of any successful action on the
part of the United States is an understanding on the part of the people
of America of the character of the problem and the remedies to be
applied. Political passion and prejudice should have no part. With
foresight, and a willingness on the part of our people to face up to the
vast responsibility which history has clearly placed upon our country
the difficulties I have outlined can and will be overcome.
I am sorry that on each occasion I have said
something publicly in regard to our international situation, I've been
forced by the necessities of the case to enter into rather technical
discussions. But to my mind, it is of vast importance that our people
reach some general understanding of what the complications really are,
rather than react from a passion or a prejudice or an emotion of the
moment. As I said more formally a moment ago, we are remote from the
scene of these troubles. It is virtually impossible at this distance
merely by reading, or listening, or even seeing photographs or motion
pictures, to grasp at all the real significance of the situation. And
yet the whole world of the future hangs on a proper judgment. It hangs,
I think, to a large extent on the realization of the American people, of
just what are the various dominant factors. What are the reactions of
the people? What are the justifications of those reactions? What are the
sufferings? What is needed? What can best be done? What must be done?
Thank you very much.
Secretary of State, George C. Marshall - June 5, 1947
In 1948, the European Recovery Program (ERP) went into effect and was
popularly known as the Marshall Plan. To help restore Europe and halt the
spread of Communism, the U.S. Congress approved funds that would eventually
rise to over $12 billion for the rebuilding of Western Europe. The Marshall
Plan spurred European re-industrialization and brought much needed
humanitarian relief to the war-torn countries. It also stimulated the U.S.
economy by establishing overseas markets for American goods. In 1953, George
C. Marshall became the only former military general ever to receive the
Nobel Peace Prize.
