The Marshall Plan And Consumerism

It Was a Vehicle for Exporting the U.S. Model? We Could Be Completely Wrong

News | Victoria de Grazia | June 2008

The following is adapted from a keynote address on a conference in honor of the 50th Anniversary of the Marshall Plan, held in Vienna May 19 and 20. 

Conservative U.S. Congressman, Henry Cabot Lodge Jr. once described the Marshall Plan as the "biggest damned interference in international affairs that there has ever been in history." It has generated a famously huge and contentious literature.

Most of us believe there is a strong relationship between the Marshall Plan and American Consumer Democracy. We believe that the United States was committed to exporting its model of consumer modernity to Europe in the wake of World War II, as part and parcel of what Odd Arne Westaad called a borderless "Empire of Liberty."

The European Recovery Plan, we think, with its giant package of aid, institutional projects, and political injunctions, was the major vehicle. And the European boom was one outcome. This consolidated Western Europe as a region of high mass consumption and democracy, the two reinforcing each other, much as in the U.S., linking the two shores of the North Atlantic, in radical antagonism to the Soviet bloc, whose authoritarian planning was incapable of delivering high levels of consumer well-being.

Arguably every one of these elements is incorrect. This is important to understanding the relationship of consumer democracy to U.S. hegemony, generally, as well as to the specific problem of understanding the Marshall Plan’s role and the effects the Marshall Plan did have, namely, dealing a sharp blow to rising consumption, together with a panoply of new rules to give old and new consumer habits a modern structure.

What the U.S. wanted to export after the wra was not mass consumption, but a "high standard of living."  There was a consumption dimension to what Barry Eichengreen and Bradford De Long called the "greatest structural adjustment program in history." But there was also an anti-consumption bias to the Marshall Plan, evident in its promotional films, as compared to others of the same era not made under American aegis.

But this folk myth—that the Marshall was the origin of consumer democracy—has proved very durable. It supported Americans’ sense of their superior position in the world going into the 1950s, and more recently, their arguments against Europeans who would downplay the role of the Marshall Plan in European recovery. This myth still works today to legitimate mass consumption promoted by global free trade, the central piece of the Washington Consensus visions of regime change.

Thus consumer culture becomes seen as a means to undermine authoritarian systems or, once the walls have been breached, to bring them into the global fold of consumer democracy.

One of the most astute observers of 1920s  emerging mass consumption society was Berlin sociologist and cultural critic Siegfried Kracauer, who focused his attention on Germany’s New Living Culture. He saw corporate capitalism rushing in to provide new norms, rules, styles to give meaning to what he called the "spiritual homelessness of the commodity world of the new class;" because "the house of bourgeois ideas and feelings in which the middle classes had previously  lived had collapsed because of  the erosion of its foundations, brought on by economic development."

He saw advertising, particularly American, as providing a new authority of sorts, together with Hollywood cinema, ostensibly concerned with entertainment rather than creating a new mass culture, actually resulting in a remarkable tension – between experimentation to stimulate interest and conformity to broad access. He saw this especially in slapstick, a great favorite with Berlin crowds. In Chaplin and other comics, he saw the portrayal of oppressive technologies and puritanical moralism—that "subjects the world to an often unbearable discipline." But he also saw the comic intention to "dismantle this self-imposed order."

In sum, discipline, disruption, and a new discipline.

The classic example of this is Modern Times, Chaplin’s 1936 film and one of the most widely viewed U.S. films in 1930s Europe.  It shows the  assembly line, the authoritarian boss, the speed up that drives Charlie crazy, it shows Charlie resisting but never escaping the rules. Indeed, it shows all possible avenues for making a living, both legitimate like the factory and the department store and illegitimate, namely vagabondage and theft. It also shows all the institutions that could stop resistance, namely the insane asylum, jail, church. In sum, Charlot shows all of the norms and all of the infractions; he disrupts, but he cannot escape, except by going out of society, only to leave of unsure of his fate. He has his dignity and the "gamine", but little more.

This sums up Kracauer’s view of American consumer culture as disruption:  the opening up of possibilities – incredibly subversive, sensual, and playful – and their closing down with new norms and regulations.

The Marshall Plan should be seen in that light—the films echo that purpose and are striking in the stinginess of the economy of desire they convey. Yes, they show the promise of productivity, but they crack down on the ways it could be satisfied; they impose discipline.

It was not in the interests of the U.S., nor in the program of American officials, to bring mass consumption in the contemporary U.S. sense to postwar Europe. What reformers wanted was to introduce a higher standard of living. This is more than a semantic difference.  On both sides of the Atlantic they were convinced that poverty and unemployment was the source of war and that polarization led to fascism and communism. Hence it was imperative to raise the standard of living, and this was  best achieved by free market liberalism, embodied in the American virtuous circle of improved  technology, high productivity, standardized production, lower prices, and  higher wages.

But American standards in the 1940s, following on decades of relative well-being and the huge boom of wartime could not offer a realistic benchmark, even for the most prosperous European nations.

First, the gap was too great, and  it would be deeply destabilizing  if expectations were to outstrip possibilities – a point European conservatives often made about the danger of copying American consumer habits.

Second, American elites themselves were ambivalent about mass consumption: At least since the 1890s, corporate capital, along with reformers, had been struggling to rein in the unpredictable element of consumer habits and to instill market and moral discipline.  The post-war period presented all kinds of unpredictability in the figure of women wage earners who now were to return to the home, fears of recession,  new military expenditure with the onset of the Cold War, and the growing disparity between the U.S. and European standards.

True, the European Recovery Program, was conceived against the background of America’s immense wealth, where consumer capitalism was well-launched, from the assembly line to distribution and marketing. Moreover, the consumer had a clear-cut position within the economy and culture generally – all showcased for the experts.

These features of America’s more articulated consumer culture made the ERP very sensitive to consumer behavior, and to the dangers that could arise if the cart was put before the horse.  Since the goal of the ERP was to develop export markets by curbing government spending, building infrastructure and reviving manufacturing, they were attentive that aid not be spent on raising consumption. They used 1938 figures on wages and consumption and were deeply hostile to spending on social welfare.

Still, the ERP engendered a huge rupture: the very idea of aid by the victor of the war was a radical departure. It was a spectacular effort, leading to the defeat of the left and the launching of the Cold War; it brought the movement of goods, the launching of programs, the arrival of American films and more through the market mechanism.

To go back to Kracauer’s terms—it brought unbearable discipline and the rupture that breaks it, only to impose a new order.

Herein lies the complicated message of the Marshall Plan, which is found in its marketing devices. Very schematically, they offer a new narrative in the most conversational terms, one of new machines, greater productivity, getting back to work, and things getting a little better.  But there is no consumer celebration; an economy of desire is stripped down to the fulfillment of necessities.

So it was not that the Marshall Plan did not have a powerful grip on the imagination at the time; it was a huge disruption, designed to impose a new discipline.  It promised all of the productivity that a revved-up capitalist war economy could deliver. But it was also designed to suppress the playful character we associate with consumer wants, the disorder of old styles of consumption, still extant in Europe, the cornucopias of populist tradition.

At the time, it eclipsed other definitions of the standard of living in post-war Europe—the social democratic in the shape of the Beveridge Report, state planning in Eastern Europe –which, by the mid-1950s, had delivered reconstruction and all of the small scale means of getting by not contemplated by mass production industry.

In the end, the mass consumption we associate with "Americanization" came only in the late 1950s, when people has long since ceased speaking about the Marshall Plan. The Korean War (1950-53) returned Germany to being an exporter, for example. A US-brokered decolonization of Europe also inherited a post ERP legacy of wider markets and cheap gasoline, and the return of American investment and tourism.

So why did the Marshall Plan become identified as the origin of mass consumption society? Perhaps it is only post hoc ergo proper hoc: The boom that followed is attributed to what came before. Or perhaps it was a confusion of the grants obtained from the Marshall Plan, often invested in infrastructure, with the aid received from the United Nations Relief and Reconstruction Agency programs and the CARE packages after 1945, which indeed did deliver all sorts of goods

The myth that the Marshall Plan delivered the goods was also abetted by the terrible fear of the alternative, namely Soviet domination. But that fear was not shared by all. There were large groups in Western Europe, within labor and the Communist left that believed that Socialism was delivering the goods in a more just way than in the Capitalist west.

Meanwhile, the Marshall Plan was advertised to Americans as bringing a high standard of living to Europeans. At home, propaganda films documented that tax dollars were being well spent on remaking Europe in America’s image, helping consolidate the Consumer Republic in the 1950s and to making many Americans believe that their way of life was the most virtuous on the planet.


Victoria de Grazia is the James R. Barker Professor of History and Contemporary Civilization, at Columbia University, New York. This talk is taken from her recent book Irresistible Empire, America’s Advance through Twentieth Century Europe (Harvard 2005).

Other articles from this issue