Wednesday, March 15, 2006

Gordon Brown's 'Marshall Plan'

This article originally appeared in the February 2005 issue of Red Pepper. I think the judgement I offered at the time has essentially held up.

Cover versions of rock classics rarely match the brilliance of the original cut. Reportedly a music fan, Gordon Brown might have done well to ponder this before branding his latest ideas for the Third World as a revamp of the Marshall Plan.

Of course, democratic socialists favour anything and everything that could alleviate poverty. Write off debts and double aid? Sounds good. Suspiciously good, in fact.

On past New Labour form, there is a distinct possibility that the concrete proposals will prove nowhere near as generous or substantial as the public relations rhetoric suggests. And getting other major capitalist nations on board will probably prove about as easy as persuading Naomi Klein to endorse those latest sweatshop Reeboks.

But let's be charitable. Suspend disbelief until full details are published. Listen to Britain's prime minister manqué as he busily talks up this 'once in a generation opportunity to deliver a modern Marshall Plan for the developing world, a new deal between the poorest countries and the richest countries'.

Not only a Marshall Plan, but a new deal too, eh? When decoding Brown speeches, I'm always glad I sat American Politics 101. The thing is, anyone aware of the reality of the Marshall Plan first time round will know it wasn't entirely an act of unprecedented benevolence.

It was a deeply ideological, not to say self-interested, step. World War Two had devastated much of Europe. The Soviet Union held out an alternative model for society, one that many activists of the time found a damn sight more attractive than capitalism.

Moreover, communist parties had led the underground fight against fascism in many countries, and had drawn in a massive influx of recruits in places such as Italy and France.

In February 1947, Clement Attlee's Labour government told Washington that Britain's own economic situation prevented it from continuing aid to Greece and Turkey. President Harry S Truman feared that either or both could come under Soviet influence.

So he told his secretary of state - General George Marshall - to come up with some means of preventing that happening. By September, 16 countries signed up to the European Recovery Plan.

But it took a communist coup in Czechoslovakia early in 1948 finally to stifle the objections of the isolationist lobby. Later that year, congress gave the proposals the green light.

Over four years, Europe picked up around $13.5bn in aid. That's something like $100bn in today's money. Not all of it came in grants. A substantial proportion had to be repaid. And much of it flowed back into the US economy after being spent on American goods and machinery, thus sparking a post-war economic boom in the States.

There is disagreement among economic historians about just how much good the Marshall Plan actually did Europe. It's a specialist debate, but a strong body of opinion has it that recovery would have happened anyway.

And socialists at the time argued that similar amounts of reconstruction finance could have been raised by expropriating money that wealthy Europeans - often wartime profiteers - had deposited in US banks during the war.

What is for certain is that the Marshall Plan had some downright sinister aspects. Italy, for example, was due to hold a general election in April 1948. A left-wing coalition led by the Communist Party was widely expected to win.

Marshall personally authorised a covert action programme to derail the democratic outcome. 'We had bags of money that we delivered to selected politicians,' remarked one former CIA asset. 'It was very gratifying. We didn't know at that time that we had carried out the first ... covert political action programme in the history of US intelligence.'

So the original Marshall Plan came with more than a few strings attached. Cash the cheque and shut the hell up about the ballot rigging.

And the suspicion has to be that, just as Marshall Plan I was ultimately designed to assert US economic dominance at the start of the Cold War, so any eventual Marshall Plan II will seek to prop up the supremacy of the world's current wealthy nations in the face of the unprecedented challenge they now face from China, India and Brazil.

Third World countries would do well to read the small print before signing up.

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