Seventy years ago, the Cold War had just begun. World War II had just ended. But how did the Cold War begin, and what did it have to do with World War II? Was it a natural consequence, inevitable even? We’ll explore some of these questions through the lens of a major event that linked World War II and Cold War: The Marshall Plan.
Today, the Marshall Plan is often forgotten or simply remembered as a foreign aid scheme (mostly when its memory is invoked for new programs like a “Global Marshall Plan”). We will, however, not only look at what the Marshall Plan was and which effect it had for rebuilding the European economy, but also at its implications for US influence in Europe, and how and why American and Soviet treatment of Europe differed so sharply. We’ll use two board games to have a closer look at these things: Twilight Struggle (Ananda Gupta/Jason Matthews, GMT Games) and Wir sind das Volk! including the 2+2 expansion (Richard Sivél/Peer Sylvester, Histogame).
What Was the Marshall Plan?
Formally, the Marshall Plan was named European Recovery Program (ERP), but colloquially people referred to it (and still do) with the name derived from its creator, US Secretary of State George C. Marshall.
Europe was in shambles after World War II. The United States and the Soviet Union remained as the only major powers in Europe. While Communist parties ruled Eastern Europe, they were also strong in various Western European countries, and Washington feared they might take over altogether. In response, the US government created the Marshall Plan – a large-scale program of American funds (mostly as grants, but also as credits) to the European countries which had to purchase American goods with these funds. The program was open for all of Europe, but the USSR prevented her allies from participating.
”Make Way For the Marshall Plan!” – The Rebuilding of Europe’s Economy
Despite the major destruction World War II had brought, the European economic recovery went surprisingly fast. Western Europe indeed enjoyed an era of prosperity, growth, and high employment unprecedented by any other like it – and later often wistfully remembered. The Germans call their post-war recovery the “Wirtschaftswunder” (economic miracle), the French the period from the end of World War II to the mid-70s the “Trente Glorieuses” (Glorious Thirty (years)). The Marshall Plan surely contributed to this positive economic development.
However, the economic recovery had been under way already before the Marshall Plan had started. Europe still possessed the same highly educated population and trade connections as before World War II, and the unfavorable weather that had struck shortly after World War II (most notably in the “hunger winter” of 1946/47) gave the continent a rest. Moreover, the changing global conditions improved for the European economy – West Germany, for example, benefited majorly from the outbreak of the Korean War and the subsequent re-orientation of the US economy towards military production which directed the demand for consumer goods towards other nations. Marshall Plan aid was more effective the earlier it was given – which is nicely reflected in the Twilight Struggle version of the Marshall Plan (see image below): Play it early, and it’s a major gamechanger for Europe, play it late, and it might not make much of a difference because most European countries are already firmly in the grip of either superpower.
Economic Aid as Containment – US Influence and the Marshall Plan
Rebuilding Europe was no purely altruistic American move. Washington was anxious about a new war breaking out, and the Soviet Army had many more soldiers and tanks in Europe than the US and her allies had stationed there. Strong allies meant that America could reduce her continental commitments, and President Truman’s administration believed that if these allies were economically interdependent, they would be less likely to quarrel among each other, further reducing the need for America to intervene in European affairs.
As often, American programs for the rest of the world aimed at making it more like America. The conditions for receiving Marshall Plan funds oriented the European economies towards a more purely market-based structure. Paradoxically, the Marshall Plan was a government intervention into the economy that undermined government intervention into the economy. The program also helped to integrate the European economies with the American one. In this way, it (and the Soviet refusal to let its allies participate) was a major step towards the division of Europe in a western part closely connected to the USA and an eastern part closely connected to the Soviet Union. Truman therefore met his goal of not letting Western European countries gravitate towards the USSR without any having to resort to military or intelligence means. The Marshall Plan fit his foreign policy approach of conservative-cautious containment well.
Giving and Taking – American and Soviet Treatment of Europe
The Marshall Plan was, as we’ve seen, good for Western Europe, and good for America. It is therefore striking how different the Soviet approach to their European allies was: The Soviet Union extracted about the same amount of resources from Eastern Europe as the Americans gave to Western Europe in Marshall Plan aid! When Washington gave, Moscow took. The main target for these extractions was East Germany, where the Soviet Union dismantled a huge amount of goods and machinery as reparations for the war – see the image of “Dismantling industry in the East” from Wir sind das Volk! to the right. It didn’t quite help with the Soviet reputation there – whereas the Marshall Plan was the best image campaign for America anyone could have thought of, especially among the Germans who were stunned that their former war enemy was now extending a helping hand.
So, why did the Soviets do it differently? – Because their situation was different, both in matters of security and economy. For the United States, the only potential security threat was the Soviet Union, thousands of miles away. So the US wanted to make sure that the Soviets could not expand, and that meant building up the European countries as a part of the American economic sphere. The Russians had worries closer to home. They had just experienced – for the second time in 30 years – how devastating a German attack could be. In 1941 and 1942, they had barely survived, and the country remained scarred. The United States had lost 400,000 citizens to the war, the Soviet Union a whopping 20 to 30 million! No wonder the Soviets were more anxious about rebuilding Germany than the US. So Soviet policy towards Germany was to keep the country weak in order to rule out any future threat. But what about the other countries? Why did the Soviets not help them? Surely they didn’t feel threatened by Czechoslovakia?
Well, they didn’t. But there was also not much to help them with in the Soviet Union. Since the country was ravaged, the Soviets placed the priority at rebuilding their own economy first, no matter what that meant for Eastern Europe. Conversely, the American economy suffered from a very different problem – overproduction. Nothing had done so much to get America out of the Great Depression as the war with its immense demand for everything from uniform textiles to planes. After the war ended, however, so did those lucrative government contracts, and American business desperately looked for new markets. So when the US government concocted the Marshall Plan, they just continued the wartime policy of economic stimulus by buying private goods with public money.
In the end, both countries succeeded with their respective plans. The United States retained Western Europe in their sphere of influence, scored a public relations victory, helped their own businesses, and waged a Cold War not with guns, but with dollar bills, which suited the rich but undermilitarized country well. The Soviet Union rebuilt her economy and therefore was able to even wage a Cold War against the much more powerful United States. However, their economic success came at the price of a propaganda setback.
Into the Cold War
The Marshall Plan was conceived out of the necessities after World War II. Then it went on to shape the Cold War. It’s important to remember, however, that this was not inevitable. Policymakers in Washington could have rejected the Marshall Plan – because of America’s tradition of isolationism, because of its meddling in the economy, because they didn’t see the Soviet Union as a security challenge. But they didn’t, and thus the world changed as it did. This may act as a reminder that history is shaped both by the conditions with which men and women must deal and their decisions how to deal with them. As Marx had it: “Men make their own history, but they do not make as they please.”
A good overview over the Marshall Plan is Hogan, Michael J.: The Marshall Plan. America, Britain, and the Reconstruction of Western Europe, 1947-1952, Cambridge University Press, Cambridge 1987.
For a thoughtful conservative critique of both the economic and the political aspects of the Marshall Plan, see Hein, David: The Marshall Plan. Conservative Reform as a Weapon of War, in: Modern Age 59, 1, Winter 2017, online here.