1948

Much of Europe was destroyed by World War II and in the immediate postwar years there was great suffering and need. With basic infrastructure gone in many places, Europeans also faced chronic and widespread food shortages. The economies of the region were in shambles.

The United States, which had been dragged into the war involuntarily, had tipped the scales militarily and had led the way in the simultaneous defeat of Imperial Japan and Nazi Germany. Suddenly the U.S. had emerged onto the international scene as the predominant world power, a role it was decidedly unaccustomed to, having historically preferred isolationism and non-intervention. Recognizing Europe’s great need and seeing that a European recovery was in the world’s best interest, Americans stepped up to help friends and former foes alike.

To help address the European food shortages, the U.S. exported a full one-sixth of its agricultural production in 1945-46 to Europe. And the U.S. began formulating a plan for the rebuilding of European economies. “It is logical that the United States should do whatever it is able to do to assist in the return of normal economic health to the world, without which there can be no political stability and no assured peace,” Secretary of State George Marshall said. “Our policy is not directed against any country, but against hunger, poverty, desperation and chaos.”

Truman and Marshall shepherded a plan through Congress for U.S. economic assistance to Europe, a major change to traditional American foreign policy. The bill (which came to be known as “the Marshall Plan”) appropriated over $17 billion (an amount that is chump change today but was approximately 7% of U.S GDP in 1948) to 16 European countries, with the greatest amounts going to the United Kingdom, France, Germany, Italy, and the Netherlands (the Soviet Union rejected the American offer and prevented occupied eastern Europe from participating).

The Marshall Plan played a major role in the recoveries of European economies, contributing to rapid economic growth in the immediate postwar years and helping largely eliminate widespread hunger and poverty.

The Foreign Assistance Act of 1948 (the “Marshall Plan”) was signed into law by President Truman on April 3, 1948.

The image is the label that was affixed to European aid packages during the Marshall Plan.