Marshall Plan Fund in Danger under German Chancellor Schroeder
A MyrtleBeachOnline.com Sun News post of October 17, 2004, contains the article, Marshall Plan dollars still at work in Europe: Businesses benefit in Germany, by Tom Hundley of the Chicago Tribune (registration required). More below.
The Marshall Plan monies are covered from a different perspective at the June 26, 2004 Guardian article under the title “Democratic Deficit” in which it was reported that:
“Nearly 60 years after the Marshall plan was launched to reconstruct Europe after the second world war, its funds are still bailing out the Germany economy. Hans Eichel, the German finance minister, wants to use €12bn left over from the Marshall plan to stealthily privatise his government’s stakes in Deutsche Telekom and Deutsche Post, to allow the government’s public sector development bank to buy its shares.”
Thankfully this plan at that time failed – it was just another of the wild plans of the incapable Schroeder administration. See in this regard the Law Pundit postings here and here.
The Current Problem
As the Guardian writes:
“For the past decade – with the exception of 2000 – the German economy has spluttered rather like a misfiring Volkswagen, during a long period of sluggish growth that reached its nadir with a mild recession in 2003. The government has seen its attempts to maintain fiscal rectitude fall victim to over-optimistic forecasts, leading to a string of deficits. While combined federal, state and local tax revenues have been static, government spending has ballooned, resulting in a €79bn deficit last year – the third time in the past three years that Germany’s shortfall has breached the 3% of GDP limit set by the eurozone’s stability pact.”
The issue of the Marshall Plan Fund has again surfaced, as found in a Welt am Sonntag, November 21, 2004, article reporting that German Finance Minister Hans Eichel now wants to appropriate the current “Marshall Plan Resource Fund” (in German known as “Marshall-plan-Mittel” or ERP-Sondervermögen) in order to keep the federal deficit from exceeding 3%.
Apparently the Schroeder administration has not considered using the Marshall Fund for the purpose for which it was intended, i.e. to get the economy moving by loaning the money out.
Based on the above events, there appear to be no bounds to the apparently desperate financial perfidies of the Schroeder administration.
Of course, there is method in this madness. The coming generations of voters – indeed, probably most of the voters who put Schroeder into office – generally have no better than passing knowledge or understanding of the role that the United States played in bringing freedom to Europe and in reconstructing post-War Germany after WWII. Rather, the anti-American views of the uninformed are those views which Schroeder and his administration nurture and use to stay in political office based on the ephemeral events of today.
People who still recall the Marshall Plan, support US efforts to bring democracy to Iraq and the Middle East. The young, softened and spoiled generations, who have little clue as to source of their freedom – also won by deposing tyrants – generally oppose the USA efforts in Iraq, apparently much to the delight of Schroeder and Co.
History of the Marshall Plan
After WW II, the United States assisted the reconstruction of shattered European economies through the “Marshall Plan”, named after then Secretary of State George Marshall who introduced the plan at a June 5, 1947 speech at Harvard University.
Under President Truman and the Marshall Plan (the European Recovery Program – ERP), the United States provided $13.3 billion (about $90 billion in today’s dollars) in economic aid to 16 European nations, most going to Britain, France and Italy with Germany as the 4th-largest recipient obtaining about $1.39 billion (about $9.4 billion in today’s dollars).
On December 15, 1949, the Marshall Plan monies in Germany were transformed into so-called “special fund” (ERP-Sondervermögen) also known as the Marshall Plan Resources Fund – monies which are specifically independent of normal German government budgetary assets, as written by the International Monetary Fund (IMF – p. 15 of that .pdf-source):
“The mechanisms for the coordination and management of budgeted and extrabudgetary activities are well defined…. The only exception is the Marshal [sic] Plan Resources Fund (ERP-Sondervermögen), whose budget is approved separately by the parliament, including an entitlement for debt.”
These monies are intended to be used to as loans to finance revolving credits for business and industry:
“‘We’re not allowed to spend this money, only to lend it. That’s the whole trick,’ said Hermann Faas, director of small business financing for the ERP.
Since its inception, the ERP has made about $150 billion worth of loans to German businesses. In the ERP’s offices, there are no U.S. flags, no bronze busts of Gen. Marshall, but according to Faas, the United States still gets credit for its postwar magnanimity.”
In any case, it is noted that:
“The Marshall Plan is revered as the wisest and most successful foreign policy initiative undertaken by any U.S. administration”.
It would seem to clearly define the dishonest nature of the Schroeder administration that the Marshall Plan monies are now up for grabs as a despicable monetary trick to help keep this incapable administration in political power.
As a matter of law, there is an interesting question as to whether US approval would be required for this kind of an extra-appropriation of the ERP monies. As reported in Welt am Sonntag:
“Das Wirtschaftsministerium ist strikt gegen das Vorhaben…. Auch sehen die Experten seines Hauses völkerrechtliche Schwierigkeiten. Bei dem Vorhaben hätten die USA ein Mitspracherecht. “
The Law Pundit translation of the above is as follows:
“The Ministry of Economics and Labor is strictly against this proposed plan…. In-house experts envision international law problems. The USA would have a right to a say in the proposed plan.”