Benn Steil. The Marshall Plan: Dawn of the Cold War. New York: Simon & Schuster, 2018. Illustrations. xii + 608 pp. $35.00 (cloth), ISBN 978-1-5011-0237-0.

Reviewed by Paul J. Heer (George Washington University)
Published on H-Diplo (August, 2018)
Commissioned by Seth Offenbach (Bronx Community College, The City University of New York)

My doctoral examination on US diplomatic history included this task: “Devise three questions about the Cold War; answer one of them; and explain why you answered that one and not the other two.” I offered these questions: What was the Cold War? When did it start? And who started it? I answered the third, but Benn Steil’s excellent new book The Marshall Plan: Dawn of the Cold War arguably offers persuasive answers to all three questions. Indeed, he notes at the outset that the book “situates the Marshall Plan more directly at the center of the emerging Cold War than earlier accounts, highlighting the seriousness with which [Joseph] Stalin treated the threat it represented to his new, hard-won buffer zone in central and eastern Europe” in the wake of the Second World War (p. xii). Steil thus underscores how the Marshall Plan—sometimes viewed as an altruistic American gesture—was in fact one of the first moves in the strategic and ideological chess match between the US and the Soviet Union that started in 1946-47 and evolved into the Cold War. 

Using a building-block approach, Steil chronicles the postwar conditions and circumstances from which the Marshall Plan emerged and was realized. He draws on a wealth of archival and secondary sources, including newly available German, Russian, Czech, and American materials. Steil previously focused on economic history, which includes his 2013 The Battle of Bretton Woods: John Maynard Keynes, Harry Dexter White, and the Making of a New World Order, a worthy prequel and companion to this volume. Here he successfully extends his purview to political, diplomatic, and military developments and shows how inextricable they were from the economic drivers and goals of the Marshall Plan.

The impetus for the plan was captured succinctly in a 1947 assessment by the Central Intelligence Agency, which judged that “the greatest danger to the security of the United States is the possibility of economic collapse in western Europe and the consequent accession to power of communist elements” (p. 12). This coincided with the Turkish and Greek crises that prompted President Harry Truman to deliver his “Truman Doctrine” speech in March 1947, committing the United States to aiding countries subject to Communist subversion. As for George Marshall himself—who had just assumed the position of secretary of state in January 1947—Steil’s book focuses appropriately on the impact on Marshall of the Council of Foreign Ministers meetings that he attended in Moscow in March and April. His interactions there with Soviet dictator Stalin and foreign minister Vyacheslav Molotov convinced Marshall of the emerging US-Soviet rift and the need to insulate the US and its allies from its implications. He subsequently observed that the Marshall Plan was “an outgrowth of [my] disillusionment over the Moscow Conference” and the need for a way “to prevent the complete breakdown of western Europe” (p. 85).

Steil provides an in-depth account of how the Marshall Plan was subsequently developed, outlining the cast of characters involved and the division of labor among them. Marshall himself merely planted the general idea and, reflecting his military command experience, delegated to subordinates the responsibility for realizing it. The strategic logic was provided by George F. Kennan, the director of the State Department’s Policy Planning Staff, and Undersecretary of State Dean Acheson; Undersecretary for Economic Affairs Will Clayton provided the operational vision; and the eventual implementation of the plan was overseen by Paul Hoffman, director of the Economic Cooperation Administration that was created for the purpose, and General Lucius Clay, the military governor of the US occupation zone in Germany. But the book also and importantly recounts the domestic political environment in which the Marshall Plan was pursued, including the need to overcome skepticism and resistance from the public and some bureaucrats who, in the wake of an exhaustive struggle in Europe, were hardly eager to reinvest there and particularly to benefit the recent German enemy. In this context, Steil especially highlights the vital role played by Republican senator Arthur Vandenberg in securing congressional approval of the Democratic Truman administration’s plan.

Similarly, Steil identifies the cast of characters involved in Europe and Russia, and the complex dynamics among them. The challenge of forging a consensus behind the Marshall Plan in Washington had its counterpart in the challenge of securing cooperation and unity of purpose among the western European allies—all of whom were internally focused, lacked confidence in each other, and remained vulnerable to Soviet and other Communist machinations. Highlighted here are the important roles played by British foreign secretary Ernest Bevin and French foreign secretary Georges Bidault as Marshall’s partners in simultaneously rallying European support and deflecting pressure from Molotov and Stalin. Meanwhile, Stalin confronted his own challenges in orchestrating the response to the Marshall Plan by his allies east of the Iron Curtain—some of whom were inclined to participate. Steil effectively weaves these layers of the story in tandem with his account of the unfolding process on the American side, showing how the threads came together at the inter-Allied conference in Paris that formulated the details of the plan, at the subsequent meetings of the Council of Foreign Ministers that yielded the Soviet rejection of participation (which Washington had gambled would happen), and on the front line in Germany—where implementation of the plan escalated the Cold War when the Russians responded with the Berlin blockade. In this way Steil shows how such developments as the blockade and the February 1948 Communist coup in Czechoslovakia reinforced US public support for the Marshall Plan.

Steil also demonstrates how the emerging security dilemma with respect to Germany, coupled with the need to ensure the Marshall Plan’s success, gave rise to the North Atlantic Treaty Organziation (NATO). “The Marshall Plan needed a martial plan” in order to secure the western European allies’ acceptance of economic interdependence with each other and with a revitalized Germany (p. 210). But this represented a “militarization” of containment contrary to the wishes and intentions of (at least) Kennan, who had formulated the doctrine of containment and saw the Marshall Plan as its centerpiece precisely because it was an economic and political strategy rather than a military one. Nonetheless, Steil almost certainly is correct that the Marshall Plan may not have succeeded without the establishment of NATO. 

How and why the Marshall Plan did succeed is the focus of Steil’s penultimate chapter. Perhaps surprisingly, he observes that it is not clear to what extent Europe’s subsequent economic recovery was the result of the plan, given the difficulty of measuring its economic effects. Steil notes that “the evidence supports the argument that Marshall aid did stimulate investment and that such investments boosted growth”—but only by about 0.5 percent, “hardly enough to justify the Plan’s legendary status” (p. 344). In addition, “the Keynesian-stimulus lens for explaining the apparent economic success of the Marshall Plan is not very useful”—but then “the Marshall Plan’s most important early architects and advocates never put much faith in the narrow stimulus channels” (p. 345).

This only reinforces the idea that the Marshall Plan was primarily a political rather than an economic success. As Kennan had originally intended, “the primary stimulative effect of the Marshall Plan would come from beneficiaries seeing that the United States was committed to helping restore them as free and independent nations” (p. 346). Indeed, the plan was specifically formulated in response to the threat of Communist electoral success—or forceful takeover—in western Europe, especially in France and Italy; and Steil is probably correct that “the Marshall Plan succeeded in keeping Communists out of government” by giving leaders in France and Italy popular support they might not have had otherwise (pp. 355-356). Perhaps more importantly, the revitalization of Germany certainly constitutes a core political as well as economic success—indeed, “the fulcrum” (p. 357)—of the Marshall Plan.

This brings us back to the centrality of the Marshall Plan to the emergence of the Cold War. According to Steil, the plan only succeeded because it was accompanied by NATO—even though the latter undermined the earlier goal of militarily disengaging from Europe, while at the same time linking the Marshall Plan in Stalin’s mind with the idea of a US military pushback against Soviet interests and security. Consequently, it is hard to escape the judgment that the Marshall Plan helped to fuel the Cold War: even if the latter was inevitable, Steil concludes that the former “accelerated and intensified it” (p. 372).

In his final chapter, Steil carries this idea forward with a somewhat unanticipated extrapolation about the unintended—but in his view largely predictable—consequences of NATO expansion fifty years later, after the Cold War ended. In his view, Washington’s insistence in the 1990s and beyond on a reunified Germany within NATO, and the enlargement of the alliance and extension of US military commitments eastward, was bound to fuel Russian concerns, threat perceptions, and subsequent actions. “Just as Stalin strengthened the Soviet Union’s buffer zone in response to the Marshall Plan, which he expected Washington to supplement with military force, [Russian President Vladimir] Putin has strengthened Russia’s buffer zone in response to NATO expansion.... Putin’s view was wholly consistent with how Soviet officials perceived the shift in US policy toward Europe back in 1946” (p. 398).

Steil makes this comparison in order to criticize the short-sightedness and ill-considered premises of US policy toward eastern Europe after the Cold War, especially its failure to recall how the establishment of NATO had blurred the original purposes of the Marshall Plan. He speculates that “George Marshall and Dean Acheson [who carried the plan forward after succeeding Marshall as secretary of state in 1949] would never have backed NATO in place of a political and economic strategy” (p. 394). Nor, presumably, would they have backed NATO expansion fifty years later in the absence of such a strategy. Steil’s point is a valid one, if a bit belabored.

But he apparently overlooks another comparison that is equally if not more relevant today. Steil concludes that the Marshall Plan “worked because the United States aligned its actions with its interests and capacities in Europe, accepting the reality of a Russian sphere of influence into which it could not penetrate without sacrificing credibility and public support” (p. 404). Washington is now facing the challenge of aligning its actions with its interests and capacities in East Asia, and the probability of having to accept the reality of a Chinese sphere of influence there. Steil’s book offers some lessons that could be applied in that new context, on the other side of the globe. As with the original extension of the Marshall Plan and NATO to American allies and partners in Europe, Washington is confronting decisions and choices about how best to protect its interests and security—and that of its East Asian allies and partners—without erring in favor of an overly military approach.

Aside from that diversion, The Marshall Plan is a comprehensive, well-structured, and crisply written book that almost certainly will now be the standard account of its title subject. It combines an expert examination of the economic aspects of the plan with an in-depth analysis of the relevant politics on both sides of the Atlantic, while firmly establishing the central role of the Marshall Plan in the origins of the Cold War.

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Citation: Paul J. Heer. Review of Steil, Benn, The Marshall Plan: Dawn of the Cold War. H-Diplo, H-Net Reviews. August, 2018.
URL: http://www.h-net.org/reviews/showrev.php?id=52387

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