If Not a Marshall Plan for the East, What?
THE Marshall Plan was probably the most successful foreign policy initiative ever taken by the United States. It gave a jump-start to Europe's reconstruction and created a prosperous security community across the North Atlantic. Dare we hope for a similar quick fix to rebuild the devastated nations of the ex-Soviet empire?
Today, as after World War II, many voices call for a peace without rancor - a settlement helping former antagonists to shed their past and rebuild. To seal the cold war no one proposes a punitive settlement such as followed World War I. No one dreams of billing the Russians for US deaths in the Korean War or economic losses from the arms race. Instead, we hope that the ex-Soviet states, like Germany and Japan after 1945, will become democratic partners in peace and commerce.
The ex-Soviet empire today is nearly prostrate, like Europe after World War II. A nudge from Washington put Frenchmen and Germans on the road to cooperation in the late 1940s. Perhaps a push from the West could encourage Poland, Ukraine, and Russia to overcome enmity today.
But US motives for helping its former foes today are not so pressing as in the late 1940s. Americans then had multiple reasons for promoting European recovery - a humane wish to alleviate hunger and cold; business ambitions to build markets for US goods; geopolitical realpolitik to keep Europe from falling into Joseph Stalin's camp.
Both compassion and business interests motivate Western aid to the ex-USSR in 1992. We want democracy to prevail over dictatorship and nuclear arms kept from dangerous hands. But we feel no clear, present security threat as in 1947.
With weaker incentives now than when Stalin lived, the Western allies today are unlikely to pay out as much as the US did for Europe's recovery. From 1948 to 1951, the US delivered some $13 billion in credits and loans to Europe. A tidy sum even in present dollars, it demanded nearly 2 percent of US GNP in 1948, declining to 0.5 percent in 1951. By comparison, total US official foreign assistance in the 1980s averaged about .03 percent of GNP - the lion's share to Israel and Egypt.
If Western Europe and Japan joined the US in aiding the ex-USSR, the donors' per capita burden could be lighter than carried by US taxpayers in the late 1940s. Then a population smaller than Western Europe and Japan provided the aid. Now, a population larger than Eastern Europe and the USSR could share the burden.
But it seems doubtful that today's rich nations, even if all pitch in, will give the same volume of aid for the ex-Soviet peoples as Europeans received under the Marshall Plan. Today's rich nations already suffer from donor fatigue. Germany feels swamped by commitments to its east. Japan waits for return of its Northern territories. Much European aid now goes to peoples not just malnourished but starving. Many Americans want aid for fellow citizens without homes or medical insurance and investment in Ame rica's schools, bridges, and natural environment.
The main reason why the Marshall Plan analogy does not fit is that the ex-Soviet realm lacks the business know-how, the legal framework, the work ethic, and the capital that lay dormant in Europe after World War II. The American investment amounted to just 10 or 20 percent of the funds invested in Europe during the first two years of the Marshall Plan, after which it declined. The US input encouraged an explosion of European energies and investment. It brought forward a multiplier effect that helped Euro pe's GNP grow by over 10 percent in 1948 and 7 percent in 1949-50.
The ex-Soviet states have little capital or gold - not even much oil ready for export. Their pollution problems may be harder to repair than the material damage done to Europe by World War II.
Today, the West has food surpluses for emergency assistance that did not exist in the late 1940s. This asset is also a risk, for food aid could discourage a renaissance of private farming.
The ex-Soviet realm has much less experience with democracy or free enterprise than Western Europe in the late 1940s. Worse, it pulses with ethnic conflicts between neighbors. Unlike Europe after 1945, the ex-USSR is not pacified by foreign occupation.
This upshot: Reconstructing the new republics will be more difficult and take much longer than Europe's recovery. Material aid - albeit less than under the Marshall Plan - can stabilize currencies, facilitate essential imports, ease bottlenecks, and curtail inflation. But intangible aid may be more important: Helping victims of a long dark night of the soul acquire the skills and confidence to stand on their own feet where there is no Big Brother and no free lunch.