Policy Planning Staff Files
Memorandum Prepared by the Policy Planning Staff1
1. Marshall “plan”.
We have no plan. Europeans must be made to take responsibility.
We would consider European plan only if it were a good one and promised to do the whole job.
Our main object: to render principal European countries able to exist without outside charity.
Necessity of this:
- (a)
- So that they can buy from us;
- (b)
- So that they will have enough self-confidence to withstand outside pressures.
2. Russia and Communism.
Strain placed on communist movement by effort to draw up plan for European rehabilitation. Communist Parties in West forced to show their hand.
Russians smoked out in their relations with satellite countries. Maximum strain placed on those relations.
Events of past weeks the greatest blow to European Communism since termination of hostilities. If same line can be continued on our part we can weaken movement still further but for this we need strong internal support.
[Page 336]Principal Communist argument today: that U.S. public and Congress will not pack [back] up program of aid to Europe.
3. Germany.
U.S. determination to keep Germany disarmed and demilitarized (Four-Power Pact).2
Meanwhile, urgent necessity for increased production:
- (a)
- From standpoint of cost to U.S. taxpayer;
- (b)
- From standpoint of contribution to European recovery.
French apprehensions: Communists making big capital out of assertion that “Marshall plan” spells preference to German reconstruction over that of France. True facts as to situation: German production less than 50% of pre-war; France—pre-war level substantially achieved. What French Government really wants: to be consulted on these matters so as to have an answer to Communist attacks.
Coal talks. Coal—the center of German and European recovery. British desire to widen talks. French fears.
4. Other areas.
European situation no precedent for other areas.
Suggestions made in Harvard speech applicable to Europe alone. Problems elsewhere require different approach, main exceptions being Korea and Japan.
Backward nations require not so much government loans as other forms of support: technical aid, business initiative, etc., which can come more directly from private sources in this country, with government support.
This problem will have to be studied carefully. There may well be instances where further expenditure of government funds in other areas may be warranted by U.S. interests; but certainly nothing is visible today which could rank with European recovery program in importance to U.S., in character of measures called for, in total costs, or in benefits to be obtained.
5. Britain.
Britain’s position—serious, more serious than most people know
Her position beginning to improve; but it will be one year before she can be expected even to approach balance of payments.
Possibly, a program of European recovery worked out by the Europeans themselves might include provisions which would benefit Britain along with the others. Britain would benefit in any case, as would this country, from an increase in prosperity in western Europe. [Page 337] But this may not be enough; and some special aid may have to be provided for Britain. This is a problem which we are now studying.
It must be remembered that first loan really shrunk in significance from British standpoint, partly on account of rises in prices and partly on account of severe winter.
If Britain should not receive some aid, she would have no choice but to dismantle extensively her defense and imperial commitments. This would mean that serious vacuums would be created in other areas which could be most embarrassing to us, and cause us many headaches.
Some of these vacuums are ones we might have to fill. This could cost far more than a completion of aid to Britain at this time.