The Marshall Plan: Dawn of the Cold War by Benn Steil

Reviewed by: Michael De Groot (mbdegroo@iu.edu), Indiana University, Bloomington, Indiana, USA

“Marshall Plan dollars did save the world,” claimed state department official Charles Kindleberger in his memoirs. ² Few initiatives in the history of US foreign policy are as widely praised. Steeped in the legend of American altruism, the European Recovery Program (ERP)—more commonly known as the Marshall Plan—is frequently invoked as the model solution when an economic crisis emerges in the world. The infusion of American aid helped reconstruct western Europe and reduced the appeal of communism after the Second World War. Yet the ERP was not just an economic program. Council on Foreign Relations fellow Benn Steil, in The Marshall Plan: Dawn of the Cold War, provides a useful reminder that the Marshall Plan played a key role in the escalation of the US–Soviet rivalry as well. Steil places the ERP in its geopolitical context, explaining the link between the ERP and the growing antagonism between the United States and the Soviet Union. Drawing on archival materials on both sides of the Iron Curtain, The Marshall Plan: Dawn of the Cold War illuminates how the program accelerated western Europe’s recovery while also triggering a chain of events that solidified the Cold War division of Europe.

Western European countries struggled to rebuild their devastated economies after the war. For American planners, the danger stemmed from the political chaos that this economic dislocation would cause. They did not fear Soviet military aggression nearly as much as the portentous implications of continued economic deterioration. The harsh winter of 1946–1947 aggravated the situation, and communist parties enjoyed strong support in France and Italy while a civil war raged in Greece. Washington worried that if political parties friendly to Moscow exploited the chaos, seized power, and aligned with the Soviet Union, the Kremlin would command the resources of Eurasia without having to resort to violence. This alarmed US policymakers because the chief lesson they drew from the Second World War was that Washington needed to prevent a totalitarian adversary from mobilizing the economies and manpower of the Eurasian landmass, which could be used to wage war against the United States. The United States could not survive as an island in a hostile world.

The reconstruction of western Europe, Steil contends, was therefore crucial to the emerging American grand strategy. US policymakers believed that western Europe’s recovery depended, above all, on using German coal and industrial production. Yet the Soviet Union, scarred by the experience of two costly wars, had no interest in rebuilding Germany. After speaking with Soviet Foreign Minister Vyacheslav Molotov and General Secretary Joseph Stalin in the spring of 1947, US Secretary of State George C. Marshall came to the conclusion that the Soviets wanted the situation in Europe, and in Germany specifically, to deteriorate further. Upon his return to the United States, Marshall ordered his staff—including Dean Acheson, George Kennan, and William Clayton—to draw up plans to rebuild Europe without Soviet cooperation. At his June 1947 commencement address at Harvard University, Marshall announced the US commitment to European reconstruction. The first ships delivering American aid arrived in France the following spring.

The Marshall Plan precipitated a swift response from Moscow. For Stalin, it marked a turning point in his thinking about Eastern Europe. Before Marshall’s speech, Stalin had permitted a degree of political independence in his sphere of influence, but now, Steil shows, “this tolerance was finished” (142). Initially surprised by the ERP, Soviet policymakers feared that American aid was a Trojan horse designed to penetrate the Soviet sphere. The American decision to rebuild western Germany posed an unacceptable threat to Soviet security, and Moscow consolidated control over Eastern Europe.

Implementing US plans required acquiescence from the western Europeans. The spectre of a powerful Germany rekindled fears in western Europe, and officials in Britain, France, and elsewhere demanded a security guarantee from the United States as the price for rebuilding Germany. The result was the North Atlantic Treaty Organization (NATO), which sought, in the words of British General Lord Ismay, to “keep the Russians out, the Americans in, and the Germans down.” This, Steil notes, was the irony of the Marshall Plan: it “aimed at aiding American military disengagement from Europe, yet ended up, through NATO, making it both deeper and enduring” (400).

Steil concludes that the initiative accelerated western Europe’s economic recovery, and challenges the findings of economic historian Alan Milward, ³ who contends that western Europe was already well on its way to recovery by the time Marshall aid arrived. More guidance would have been helpful about where Steil sees his book in relation to the many others who have written about this issue, including Michael Hogan and Charles Maier. ⁴

The Marshall Plan: Dawn of the Cold War is sympathetic to US policymakers and their solutions to the challenges of the early Cold War period, but Steil is careful not to gloss over the costs. While Steil does not say that the United States caused the Cold War, the picture he paints is one in which the Truman administration, fully cognizant that the Marshall Plan would frighten Moscow into consolidating its own sphere of influence, took the initiative in driving the Cold War forward. Steil understates the extent to which scholars have already placed the Marshall Plan at the centre of the early Cold War, but the book reinforces the centrality of Germany in Washington’s and Moscow’s thinking. “The conflict was inevitable,” Steil concludes, based on how the two sides defined “their vital interests” (372). For Steil, the early Cold War was more about the irreconcilability of geopolitical interests than competing ideologies.

While much of the narrative will be familiar to readers who are acquainted with the literature on the origins of the Cold War, The Marshall Plan: Dawn of the Cold War is an accessible and engaging account that demonstrates the intimate relationship between economics and geopolitics. Making the Marshall Plan a success required careful planning, prioritizing among objectives, and mobilizing support at home and abroad. In an era when the utility of the Atlantic Alliance has been questioned openly and repeatedly, it is useful to return to its genesis and ask why the United States committed to Europe’s defence in the first place. US policymakers understood that American prosperity and security depended on conditions in the international system, and the United States could not expect to retreat into isolation without sacrificing its long-term interests.