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Susan Green

Congress Bloc Turns Tame
When It Comes to ERP

(18 April 1949)

From Labor Action, Vol. 13 No. 16, 18 April 1949, pp. 1 & 4.
Transcribed & marked up by Einde O’ Callaghan for the Encyclopaedia of Trotskyism On-Line (ETOL).

Last week the Senate, 70 to 7, approved President Truman’s European Recovery Program bill, authorizing the extension of the Marshall Plan for fifteen months – cost, $5,580,000,000. The House is expected to meet in special session and to pass virtually the same measure, easily overcoming a flurry of proposed amendments.

There is a sharp contrast to be noted. What has happened to the coalition of Southern Democrats and Republicans which enacted an anti-tenant rent bill; which stalls, delays and opposes repeal of the Taft-Hartley Law; which refused to kill the obstructionist practice of filibuster; which serves the Truman Administration in its own fashion as the avowed reason why Democratic election promises arc not fulfilled? Why now this overwhelming Truman support?

What has become of that coalition? It suspends itself for what is called the bipartisan foreign policy. That may sound like something good. Actually it means that while both parties are united on what American capitalism must do abroad as the top imperialist power, there is no such concern with questions of raising the living, security and democratic standards at home.

Amendments Beaten

And so it was so easy to prevent the passage of such amendments as came from Senators Malone, Republican from Nevada, and Kem, Republican from Missouri. The former wished to substitute three-year loans to the ERP countries in place of the Marshall Plan; the latter, fearful of the spread of “socialism,” wanted to withhold funds from nations which “would use the money for nationalization of basic industries.” But the senators were not going to let such notions upset the apple cart. As they see it, the industry of Western Europe, nationalized or unnationalized, is being neatly tied to the war plants of America – and that’s good enough for Congress.

So bent is Congress on not upsetting the apple cart that the Senate toned down to a whisper the amendment of Senator Brewster to the effect that ERP aid be stopped to any nation which fails to comply with United Nations directives. The target of this amendment was, of course, the Netherlands for defying the United Nations on Indonesia.

The Senate compromised by agreeing to cut off ERP aid ONLY IF the Security Council invokes sanctions against a defiant nation. Of course, the Senate bleeds for the Indonesians, but priming Western Europe for war production comes first.

No wonder Paul G. Hoffman, ERP administrator, was so pleased. He told the Senate:

“We are delighted with the result, particularly that the vote was 70 to 7. We think when the news strikes Europe it will mean a great deal to the morale of the people of those countries.”

What “people” do men like Hoffman have in mind? Whose morale is being fortified? Governments, as governments and as owners of industry, are strengthened by ERP, as are private capitalists, both willingly tying their interests to the war plans of the colossus of the West. But there is proof that the workers and peasants of the ERP countries arc not the direct beneficiaries of ERP aid.

Many people think of the Marshall Plan as a great charity to alleviate the sufferings of the gaunt, starved, sick, unclothed and unhoused millions almost buried in post-war ruins. It is true that the edge has been taken off this extreme suffering. But the misery of the masses is still overwhelming. Low wages, high prices, black markets, lack of consumer goods and housing combine to make a miserable standard of living. Today the Marshall Plan is not directed toward raising that standard of living, but toward strengthening heavy industry of Western Europe for war production and toward increasing production for an export market.

Consumption Low

In line with this objective, while for most Western European countries the end of 1947 saw industrial output exceeding that of pre-war levels, agriculture was still 11 per cent below pre-war levels. Production of food in general lags behind in ERP countries.

Sharply contrasted with the rise in industrial production to well above pre-war levels is the status of per-capita consumption. To illustrate, consumption of bread grains was 159 kilograms per capita in 1947–48, against a pre-war average of 192; consumption of fats and oils was 17, against a pre-war level of 24. These figures apply to ERP countries as a whole.

In Great Britain, we find, the percentage of national income spent on personal consumption was 78 in 1938, in 1947 it was 70, and under ERP planning for 1948 it was reduced to 69. The latest “austerity budget” for Great Britain takes away 45 per cent of a worker’s pay in income tax, imposes sales taxes amounting to 33⅓ per cent on clothing and 100 per cent on what are designated as luxuries. At the same time this austerity budget increases military expenditures 10 per cent over the preceding year.

Not one of the senators of the great American democracy rose to offer an amendment to the ERP renewal bill requiring a reallocation of funds to increase personal consumption and raise the standard of living of the European people. Less personal consumption and more military expenditures is okay with Congress.

How ERP Works

Let us develop further the picture of how ERP works. A New York Times report from Norway, an ERP country, reads: “[Norway] has reduced her living standards to the point of diminishing returns ... The actuality is that the combination of high taxes and low consumption is depriving workers of the incentive to produce. The workers are losing interest in overtime pay since there is very little on which to spend extra money.”

Further, we read in the Winter issue of the magazine Politics that for the first six months of 1948 the net increase in productive plant in France was four times greater than it was during the whole of 1938. In contrast, here’s an example of workers’ wages: Paris street railway workers earn 20 to 28 cents an hour; in other cities the rate is 5 to 25 per cent less.

Martin French relates in Politics the visit of American and French journalists to a factory at Epinal, France, where ERP-aid cotton was going into production. The owners served champagne for the occasion. But working at the machines were young girls – minimum legal age: is fourteen – who slave 48 hours a week for not quite $4.00 pay. Mr. French points out that in this ERP transaction, the American cotton grower gains, the French government gains and the French capitalist gains through having a sure supply of raw material of better quality at reasonable (not black market) prices. But certainly the young girls earning not quite $4.00 a week can’t buy the products they help produce.

Recovery For War

No American senator rose to amend the ERP renewal bill to require a decent minimum wage for the workers of Western Europe, and perhaps a better child-labor law. Of course, one does not expect capitalist politicians to make such amendments. This is just a way of pointing up the fact that the Marshall Plan is not operating as a people’s recovery program but primarily as a war preparations plan.

If one expects the Congress of the capitalist government to accept this plan of American imperialism without criticism, one has a right to look for something else from organized labor. However, neither the CIO nor the AFL has a word to say against the war-production orientation of the Marshall Plan. The Economic Outlook, CIO’s monthly, excuses the low personal consumption in the ERP countries as follows:

“European consumption is still below the pre-war level, because the European economy suffers from the loss of its foreign investments during the war, from the stoppage of raw materials from east of the Iron Curtain, from the loss of raw materials from the Far East.”

Undoubtedly all these factors have their influence. But does it serve any purpose, except that of American imperialism, to omit that ERP is not operating as a people’s recovery program but as a war-production recovery program? Perhaps the eaders of organized labor assuage their conscience for their silence on this angle of ERP, by telling themselves that the workers are worse off behind the Iron Curtain. But since when is this the standard of measurement?

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