Marshall Plan

   Although political stability came on the whole easily to post–World War II Austria, the country’s economy recovered more slowly. It was not until 1948 that food rationing came to an end. The division of Austria into zones of occupation made the process all the more sluggish. The Soviet Union disapproved strongly of the Marshall Plan. Nevertheless, the Soviet representative joined in a unanimous resolution of the Austrian council of ministers in 1948, allowing American aid (through the Marshall Plan) to come into Austria that same year.

   The first installment of $280 million went largely to feed the precariously nourished population; what was left, combined with later grants, helped to rebuild the manufacturing and industrial base of the country. Between 1948 and 1952, when the Marshall Plan came to an end, Austria received about $1 billion in cash donations from the program. Foodstuffs and raw goods were either shipped free of charge from the United States (U.S.) or from third countries, which the U.S. then reimbursed. Austrian payments for these supplies were deposited in an Austrian account that was then drawn upon for further investment in the country’s economy. Freed from dependency on foreign credit markets—which had been the case after World War I—the Austrian economy improved. A great need for both capital construction and consumer goods both at home and abroad encouraged high industrial output.

   Historians generally acknowledge that the Marshall Plan was crucial in getting Austrian business and industry moving once again. Other sides of the program were, from the American standpoint, somewhat less successful. Concerned to keep the appeal of communism to a minimum, the Americans encouraged Austrians to adopt corporate and competitive practices that maintain high rates of economic growth, thereby making work abundant. But the very principle upon which the political stability of the country was based—participation of both the Austrian People’s Party and the Socialist Party of Austria in the postwar coalition government—forced the U.S. State Department to modify its other goals considerably. Austrian labor retained far more influence in the decisions on industrial policy than was the rule in the U.S. Both industry and labor were more comfortable with the cartel-like organization of heavy industry than was common in America. For their part, the Americans grew increasingly reluctant to interfere with a labor–management structure that grew and prospered rather quickly. That this development took place both in the private and nationalized sectors further weakened the appeal of the Soviet alternative.

   See also Foreign Policy.