What Was the Marshall Plan?
Prior to Marshall's speech, President Truman announced the Truman Doctrine in March 1947. Casting aside a former policy of nonintervention, Truman pledged U.S. support to any country resisting authoritarian rule. The president made this speech in response to the Greek government's civil war against the rising Communist Party, which the U.S. government believed had benefited from Soviet support. The fundamental foreign policy shift of the Truman Doctrine, soon followed by the Marshall Plan, coincided with the emergence of the Cold War.
The European Recovery Plan (the Marshall Plan's official title) had a publicized mission of economic salvation for Western Europe, with an intentional byproduct of Communist containment. Though the Soviet Union was initially invited to join the program, it quickly declined because of its refusal to disclose its economic and industrial assets. That exit provided the United States with a diplomatic avenue for rooting out Communism in exchange for assistance.
One of the prerequisites of the Marshall Plan was that European nations initiate the program. Rather than the United States stepping in and granting whatever amount it deemed necessary, the government left it up to European diplomats to work collectively and present a uniform request. To do so, British and French foreign ministers organized the Conference of European Economic Cooperation (CEEC) in Paris in July 1947. The CEEC, composed of 17 participating nations, initially asked the United States for $29 billion over four years. The U.S. government declined the sum, wanting greater detail on precisely how the countries would distribute and implement the grant.
While Congress haggled over the Economic Recovery Plan bill, a Soviet-backed coup erupted in the former Czechoslovakia in February 1948. That event set off Cold War alarm bells and instigated bipartisan consensus to pass the Marshall Plan into law. On April 3, 1948, President Truman signed the Economic Cooperation Act into law, approving $13 billion of monetary and export assistance over four years for participating countries. The bill also created the Economic Cooperation Agency to oversee the funding dispersal. That figure represented more than the sum of all previous foreign aid ever doled out by the United States [source: Schain]. In Europe, the Organization for European Economic Cooperation (OEEC) met the following week to hammer out the country-specific appropriations.