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The Marshall Plan Speech
The following is the speech given by Secretary of State George C. Marshall in which he outlined a program of economic
assistance to war-torn Europe. It became known as "The Marshall Plan Speech"
June 5, 1947, Harvard University, Cambridge, Massachusetts
Mr. President, Dr. Conant, members of the Board of Overseers, Ladies and
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
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 judgement. 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.