The Marshall Plan

Naill Ferguson on Greg Behrman's 'The Most Noble Adventure'.

The total aid package was equivalent to less than three per cent of the recipient countries’ combined national income, and it represented less than a fifth of their gross investment.

To gauge the true importance of the Marshall Plan, it is crucial to get a sense of the amounts involved. Behrman writes, “From June 1947 to its termination at the end of 1951, the Marshall Plan provided approximately $13 billion to finance the recovery . . . of Western Europe.” This was less than half the Europeans’ initial request and four billion dollars less than President Truman’s initial proposal to Congress, but it was still serious money. Behrman computes that, in today’s dollars, “that sum equals roughly $100 billion, and as a comparable share of U.S. Gross National Product it would be in excess of $500 billion.” That’s actually an understatement. In fact, the total amount disbursed under the Marshall Plan was equivalent to roughly 5.4 per cent of U.S. gross national product in the year of Marshall’s speech, or 1.1 per cent spread over the whole period of the program, which, technically, dated from April, 1948, when the Foreign Assistance Act was passed, to June, 1952, when the last payment was made. A Marshall Plan announced today would therefore be worth closer to seven hundred and forty billion dollars. If there had been a Marshall Plan between 2003 and 2007, it would have cost five hundred and fifty billion. By comparison, actual foreign economic aid under the Bush Administration between 2001 and 2006 totalled less than one hundred and fifty billion, an average of less than 0.2 per cent of G.D.P.