Britain and the Marshall Plan
The United Kingdom was the Marshall Plan's largest recipient, drawing roughly $3.2 billion, under conditions that strained its economy and empire.
European Recovery Program administration: The OEEC and Economic Cooperation Administration machinery that allocated and supervised Marshall aid country by country. Britain's allocation was negotiated and monitored through this joint US-European machinery.
End of Lend-Lease: The abrupt 1945 termination of American wartime supply aid, which stripped Britain of its main external support. The sudden cutoff left Britain broke before the Marshall Plan existed.
Clement Attlee: British prime minister from 1945 to 1951, whose Labour government accepted Marshall aid while defending the welfare state. His cabinet set the policy the aid conditions had to accommodate.
Monnet Plan: France's state-directed modernization program, which used Marshall aid to rebuild and rationalize basic industry. France used the same funds to plan modernization; Britain used them to defend sterling.
Devaluation of sterling, 1949: The September 1949 cut of sterling from $4.03 to $2.80, announced after pressure on the dollar rate. Aid could not save the exchange rate; the devaluation admitted it.
Economic Cooperation Administration: The US agency, led by Paul Hoffman, that dispensed Marshall Plan funds and pressed recipients on economic policy. The body that enforced the strings on British spending and trade policy.
Anglo-American loan: The 1946 US loan of $3.75 billion to Britain, carrying convertibility and trade-liberalization conditions. The loan was exhausted by 1947, forcing Britain into the new program.
Ernest Bevin: Foreign secretary 1945 to 1951, who pushed Britain into mediating between Europe and Washington. Bevin drove the 1947 response that shaped the plan's European framework.
German currency reform of 1948: The replacement of the Reichsmark with the Deutsche Mark that reset West Germany's economy. Germany reset its currency with American backing while Britain clung to sterling's old rate.
Schuman Declaration: The 1950 French proposal for a coal and steel community that Britain declined to join. Aid diplomacy pulled Britain toward Europe; the government still stayed out.