The world as it is: We need a Marshall Plan for the modern era

  • Article by: BONNIE BLODGETT
  • Updated: August 22, 2014 - 7:04 PM

But it’s not what we’ve had in recent decades as we worship at the free-market altar.


A stamp introduced in 1997 honored George C. Marshall on the 50th anniversary of the European Recovery Program — the Marshall Plan.

Photo: Associated Press,

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In 1945, Europe lay in ruins, its economy a shambles, its political institutions in disarray. Russian dictator Josef Stalin seemed poised to impose yet another new world order, one that would replace Hitler’s fascist cartels with Soviet-style, state-owned conglomerates. Was democracy on the ropes again?

Amid the tumult of today’s world, it may help us to recall how America once succeeded in bringing order out of chaos — and how, more recently, it has failed.

If World War II had taught Americans one lesson, it was to not take freedom for granted. President Harry Truman sent Gen. Douglas MacArthur to Japan to lay the foundation for democracy in the Far East. In exchange for our dollars, Japan agreed to adopt our values. Emperor Hirohito was demoted from supreme ruler to figurehead in Japan’s new parliamentary system. Women were allowed to vote alongside men.

Buoyed by our financial aid, Japan’s economy soared. Americans felt fortunate to have military bases (these were part of the deal MacArthur negotiated) not too distant from China, a nation that had rejected freedom for Mao Zedong’s unique brand of communism in 1948.

Truman gave Gen. George Marshall a similar assignment in Europe. In a speech at Harvard to which journalists were not invited, Marshall proposed a strategy to rebuild Europe in our image. Informally known as the Marshall Plan, the European Recovery Act would require U.S. taxpayers to invest billions to build a bulwark against Soviet aggression. The former Third Reich received the largest share of our largesse.

As in Japan, acceptance of democratic institutions was the quid pro quo. Marshall laid out the terms: “The policies to be effectuated are … the sustaining and strengthening of the principles of individual liberty, free institutions and genuine independence in Europe.”

The plan was not aimed at any one country or ideology, Marshall said. Its targets were “hunger, poverty, desperation and chaos. Any government that is willing to assist in recovery will find full cooperation on the part of the USA. [Our] 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.”

No one was surprised when the Soviet Union declined to participate.

Marshall’s scheme was presented to the American people as a logical extension of established policy that had begun before the war. The Export Control Act, popularly known as “the moral embargo,” had been passed soon after Japan’s brutal invasion of China in 1938, ostensibly to protest the deaths of tens of thousands of innocent civilians. The embargo was extended several times, with more and more commodities critical to Japan added to the list. When oil was embargoed in 1941, Japan chose to retaliate militarily.

The attack on Pearl Harbor was not meant to draw America into the war but to manipulate our political system, which Japan’s leaders regarded as laughably clumsy and indecisive. They knew that the majority of Americans were opposed to foreign entanglements. If the U.S. were indeed a democracy, surely a bit of spilled American blood would trigger a populist uprising against a president (FDR) who advocated deeper American involvement in the war, both in Europe and Asia. The Japanese were shocked when, instead of throwing the bastard out, Americans turned their clumsy democracy on a dime. We didn’t just enter the war — our participation shortly ended it.

All this swift and decisive action, followed by the breathtakingly effective midwifing of democracy by Marshall and MacArthur, stands in stark contrast to America’s bewilderingly passive-aggressive behavior in the post-Cold War era.

In 1991, when Boris Yeltsin handed over Russia’s state-owned conglomerates to a few of his cronies and then handed himself the presidency of the new Russian Federation, we naively assumed that his next order of business would be to establish a functioning democracy complete with a regulatory apparatus and American-style rule of law. Even though that didn’t happen, we also opened our markets to China with no strings attached. Political values were now irrelevant; getting the economic ball rolling was what counted. Apparently Ronald Reagan’s righteous “tear down that wall” speech was intended only to remove a trade barrier.

The Russian Federation was a disaster from day one. Its rudderless path to quasi-democracy further emboldened China’s dictators to stay the communist course. They had only to point to the relative chaos of the Glasnost era, when Gorbachev was pushing Western-style political reforms such as free speech and limited representational government, to discourage prodemocracy stirrings. That is, until Tiananmen Square. When student protests in 1989 were violently quashed, the deadly confrontation with tanks captured on live TV, President George H.W. Bush expressed moral outrage and went right on promulgating the newly fashionable fiction that free markets would (sooner or later) free people.

In fairness to Bush, he did have his hands full with Saddam Hussein. The first Gulf War ended inconclusively, and the president’s son took it personally. President George W. Bush would not be cowed by a sociopath. Speaking at U.S. Military Academy in 2002, he vowed to emancipate the whole Middle East. Bush told the cadets, none old enough to remember how it had really happened, that “moral clarity was essential to our victory in the Cold War. … When leaders like John F. Kennedy and Ronald Reagan refused to gloss over the brutality of tyrants, they gave hope to prisoners and dissidents and exiles, and rallied free nations to a great cause.”

Kennedy did face down Khrushchev in Cuba. But he also started a war in Vietnam against Ho Chi Minh, an independence leader beloved by his people. Reagan did scold Gorbachev (the true father of Glasnost) but he also promised to lift the U.S. embargo on grain exports to the Soviets — Jimmy Carter’s largely symbolic “punishment” for the Soviet invasion of Afghanistan in 1979 — to help win the 1980 presidential election as public support for the embargo weakened. Reagan’s proudest achievement was trickle-down economics and the hold-your-nose-and-trade philosophy that liberated China from the yoke of America’s moral outrage.

China now leads the world in human-rights violations, with tens of thousands of “nonconforming” dissidents either imprisoned or dead.

Ever since the likes of Apple and Nike put cheap labor before fair labor practices in China and other developing nations, encouraged by our government in the name of U.S. global competitiveness, all efforts to persuade Beijing to give freedom a chance have failed. China boasts the fastest-growing economy in the world. Its conglomerates are forging partnerships with ours that may soon become forced marriages with Chinese CEOs and shareholders in charge. “Raising all boats” and “feeding the world” may sound high-minded, but they only gloss over (to borrow Bush’s turn of phrase) such lowlife practices as moving corporate headquarters overseas to avoid paying U.S. taxes.

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  • Marshall Plan aid enabled Germany to rise from defeat, as symbolized by this worker in West Berlin in 1948.The Marshall Plan was anything but silly; in contrast to today’s magical thinking, it was clear-eyed and hardheaded.

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