Complete the Marshall Plan

By , Henry Reuss was deputy general counsel of the Marshall Plan in 1949, a member of Congress (D) of Wisconsin, 1955-1983. He is on the board of directors of the Association to Unite the Democracies (AUD). Henry Smith, a member of Congress (R) of New York, from 1965-1975, is chairman of the board of AUD.

AS Eastern Europe rushes to freedom, the West is slowly creating the pieces of a Marshall Plan - aid packages, a European Recovery and Development Bank, and coordination through Western institutions that grew out of the original plan: the European Community and the Organization for Economic Cooperation and Development. Now these pieces need to be put together in a full Marshall Plan system, commensurate with the needs not just of Poland and Hungary, but of Czechoslovakia, East Germany, Romania, and Yugoslavia. And this system should have a capacity for handling the much bigger case of the Soviet Union if it should go the full democratic course.

This isn't so difficult. The caveats have missed the point. The need is not to make a huge new commitment or invent a new Marshall Plan - but to resume the original Marshall Plan of 1948.

The Marshall Plan always intended to include peoples of Eastern Europe and Russia. As General Marshall said in his Harvard speech, ``Our policy is not directed against any country or doctrine but against hunger, poverty, desperation, and chaos.'' The Poles and the Czechs appeared in Paris to join in the plan, until Stalin ordered them home.

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The Marshall Plan had its final fiscal 1952 appropriation and suspended operations. Now, a generation after it was interrupted, Eastern Europe is again ready for the plan. Now is the time to fulfill the commitment made in 1947. The plan needs only reauthorization and a 1991 appropriation.

The Marshall Plan stabilized the new democracies of its time not just by financing recovery but by organizing them for unity with each other and older democracies. Its international machinery is intact. Its main creation, the OEEC (Organization for European Economic Cooperation), has grown into the OEC (Organization for Economic Cooperation and Development), and paved the way for the EC (European Community) and EFTA (European Free Trade Association).

To complete the Marshall Plan's call for joint action, Eastern European states should now join the OEEC's successor institutions. That, in fact, is exactly what they want: to join OECD and EFTA, and become associate and eventually full members of the EC.

They do not want a separate East bloc economic system. They know the road to mutual integration of East-bloc economies runs through the West - through real prices and markets, and integration into a West-based world economy. But they may form a Central European union. Indeed, as Vaclav Havel made clear in Warsaw, if the West stays at arms length, the East bloc will try a separate union. It would be much better if they were part of the Marshall Plan from the start.

How can Phase II of the plan be paid for? Fortunately, Phase I was so successful that Germany and Japan can now be major contributors. Indeed, the Germans are providing major funding through separate national programs. To avoid an appearance of German domination, the assistance should be channeled through an OECD committee that would review plans, determine their eligibility for Marshall Plan funding, and monitor progress. The Group of 24, which is presently coordinating Western aid, has laid the grounds for this.

Could OECD keep up with the new pace of change? With its unanimous consent method of decisionmaking, probably not. New democratic inventions may be needed, like decisionmaking by a super-majority rather than unanimity, or adding an elected OECD assembly with powers akin to those of European Parliament.

Marshall Plan, Phase II, offers OECD a great challenge. OEEC-OECD has done good work, but ever since it finished Phase I in 1952 it has been dry and technical. Phase II would breathe new life into OECD and transform it into a ``Common Democratic Home'' for the emerging democracies. Thus would it secure democracy for the next generation, as Phase I did for the last.

The Marshall Plan was never completed. Now it's time to do so.

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