A Marshall Plan for Southern Mexico and Central America?

Mexico’s incoming foreign minister has said that a scheme similar to the Marshall Plan that helped rebuild Western Europe after the Second World War will be necessary to handle the migrant crisis coming from Central America and southern Mexico.

Marcelo Ebrard told reporters in Mexico City that a major investment of that kind would be necessary to develop the area and to fix conditions that push migrants north from Central America and away from violence and poor economic conditions.

The idea has come up as incoming Mexican president Andrés Manuel López Obrador considers how to handle the border crisis that he inherited when he was sworn into office.

President Trump’s administration has suggested that migrants should be kept in Mexico as their asylum claims are processed.

Mr Ebrard, who is due to meet US secretary of state Mike Pompeo to discuss the border and migration, said estimates were still being prepared to determine just how much funding would be needed to develop the region.

Mexico alone was likely to invest more than $20 billion in southern Mexico during the coming administration, Mr Ebrard said.

“As a result, any serious effort undertaken for our brothers in El Salvador, Honduras and Guatemala would need to be a similar sum,” he said. The majority of those involved in the migrant caravans making their way to the US border are believed to be Honduran.

Now bear in mind, he wants us to give him $20 billion. Trump is only asking for 5 billion for his wall.

Revitalizing Southern Mexico was a key pledge of President Obrador’s during his run for the Mexican presidency, and defending the poor more broadly has been a central theme to his political rise to the top echelons of Mexican politics.

But the migrant crisis on the US-Mexico border may be the first major challenge to President Obrador’s commitment to help the struggling masses he has championed as he looks to balance demands from the US alongside those of the migrants who are fleeing violence and economic depression in Central America.

Mexican officials have already indicated that keeping migrants in Mexican border towns is turning into a humanitarian crisis, with officials expressing concern that keeping would-be refugees in Mexico as they await the conclusion to their asylum cases could force people into crowded shelters with terrible conditions.

There has been added tension at the border between Tijuana and California after US border patrol officials opened fire with tear gas canisters on migrants who attempted to rush the border, with a number of women and children caught up in the clashes.

The US, for its part, defended the use of those tactics and President Trump indicated that tear gas canisters and other means of physical control are not intended to be used on women and children.

“They’re not coming into the United States. They will not be coming into our country,” President Trump said.

Critics have accused the Trump administration of a draconian response, while Mexico has demanded the US investigate its use of tear gas.

The migrants and refugees themselves were urgently exploring their options amid a growing feeling that they had little hope of making successful asylum bids in the United States or of crossing the border illegally.

There was a steady line outside a tent housing the International Organization for Migration, where officials were offering assistance to those who wanted to return to their home countries.

So we have a real mess at the southern border and the Mexican President thinks a program like the Marshall Plan will fix it.

So let’s look at the Marshall plan.

The Marshall Plan gave more than $15 billion – or more that $157 billion in 2018 money – in economic assistance to Western Europe following the conclusion of the Second World War.

Bear in mind. That was our tax dollars that were spent to rebuild our formers enemies and all the damage they caused.

The plan was announced in a speech at Harvard University given by Secretary of State George C. Marshall.

On June 5, 1947, on the steps of Memorial Church at Harvard University, he outlined an ambitious European Recovery Program (ERP) that would soon carry his name, the Marshall Plan.

He stated: “The modern system of the division of labor upon which the exchange of products is based is in danger of breaking down…. It is logical that the United States should do whatever it is able to do to assist in the return of normal economic health to the world, without which there can be no political stability and no assured peace. Our policy is not directed against any country, but against hunger, poverty, desperation and chaos.”

Marshall presented the concept to the American people and Congress, telling them that we must avoid the mistakes that had been made in post-World War One Europe from re-occurring.

He contended that it was the policy of American isolationism that had allowed the Treaty of Versailles to endanger Europe and brought forth a second bitter war to the continent.

Sixteen nations met in Paris, outlining the assistance that each required and how this aid was to be divided.

The final proposal agreed upon by delegates asked for $22 billion in aid; a figure that President Truman could not justify in Congress.

Although Truman cut the request to $17 billion, the plan still met with strong opposition and after much filibustering, Congress approved $15 billion, 157 billion in today’s money.

President Truman officially signed the Marshall Plan into law on April 3, 1948.

The Economic Cooperation Administration (ECA), headed by Paul G. Hoffman, was formed to administer the funds. The first aid had already been provided to Greece and Turkey in January 1947, prior to the official signing of the program. Italy followed in July 1948.

The majority of the funds provided, went to purchase goods, mainly manufactured or produced in the United States. At the beginning, this was primarily food and fuel.

This became a main criticism of the program in that America was following a concept for economic imperialism, in an attempt to gain economic control of Europe.

But in reality, the amounts that America donated as part of the Marshall Plan, can hardly be considered “imperialism”, in that they represent only a small fraction of the GNP, and the duration of the program was limited from the start.

Beginning in April 1948, the United States provided these funds for economic and technical assistance to those European countries that had joined the Organization for European Economic Co-operation.

In Germany, a vast amount of money was invested in the rebuilding of industry, with the coal industry alone receiving 40% of these funds.
The concept was simple enough, companies that were provided such funds, were obliged to repay these “loans” to their government, so that these same funds could be used to assist other businesses and industries.

Post-war Germany had been forced to dismantle a great deal of its major factories and industries, according to guidelines enforced by the Allied Control Council.

Figures for car production alone had been set to levels that represented only 10% of pre-war numbers. With the introduction by the Western Allies of the German “Mark” as the new official currency, on June 21, 1948, a new economic era was created within Europe and especially Germany. An agreement signed in November 1949, increased these production figures for Germany dramatically.

Germany and the other European countries, over the years, have absorbed these “repaid” funds into their national budgets, thereby “disappearing”.

It was never intended that these funds were to be repaid to the American government. So we basically just gave them $157 billion after we had just spent a fortune fighting WWII.

But the plan didn’t end there.

The Marshall Plan also included a Technical Assistance Program, which funded engineers and industrialists to visit the United States, to gain first-hand experience of industrial capitalism and technological transfer.

Under the same program, American engineers came to Europe, to advise and provide technical support to developing industries.
After four years, the program had surpassed all expectations, with each member country achieving a larger GNP (Gross National Product) than pre-war levels.

On December 11, 1953, George Marshall was awarded the coveted Nobel Peace Prize, for his work.

Within the short period between 1948 and 1952, Europe experienced a dramatic increase in economic production. The hunger and starvation experienced by so many displaced persons, literally disappeared overnight.

Whether or not, the Marshall Plan alone can be accredited for this achievement is a question that historians may never be fully able to answer. For sure, the Marshall Plan helped to rebuild Europe.

The Soviets and the Eastern Bloc naturally turned down any such aid offered by the Americans, thereby causing yet another wedge between the two political systems, which was followed by the introduction of an East German Mark in July 1948, the blockade of Berlin and the ensuing Berlin Airlift in 1948/49.

From Finland, Hungary, Romania and especially East Germany; the Soviets demanded large reparation funds and goods, which in turn slowed down their economic development after the war dramatically.

Without question, the Marshall Plan laid the foundation of European integration, easing trade between member nations, setting up the institutions that coordinated the economies of Europe into a single efficient unit.

It served as a prelude to the creation of the United Europe that we have today.

Only a few years after the Marshall Plan Program; Belgium, France, Italy, Luxembourg, the Netherlands and West Germany, joined together and formed the European Economic Community (EEC), with the signing of the Treaties of Rome, in 1957.

Development within Europe that continued to expand its membership, brought about the Maastricht Treaty of November 1, 1993, forming the European Union, that resulted in the new European-wide currency, the “Euro”, which replaced all national legal tender of member countries, in 2002.

So this idea proposed by the Mexican President is nothing new.

In fact, former U.S. Vice President Al Gore has also suggested a “Global Marshall Plan”, intended to take funds from wealthy nations, to assist in the development of environmentally based industries in Third World Countries.

When one considers that 15 million children die of hunger each year; that 1 in 12 people on this earth are undernourished; or that 1 in 4 live on less than $1 per day; perhaps some would agree that such a program would be money well spent.

But I have several problems with the idea.

First. Let’s take the starving children argument out of the equation.

It seems the progressives always want to turn to the starving children in support of any argument they make.

Before we take care of all the starving migrants in Central America, I think we should first take care of the 1 out of every 8 children in the United States under the age of 12, who go to bed hungry every night. hungry.

Folks it is not just third world countries that have this problem.

17 percent of German children today live near or under the poverty levels.

Here is the bigger problem.

At the end of WWII we gave Western Europe $157 billion and they completely rebuilt their economies with new factories, technologies, and infrastructure.

Did I mention we had a similar plan for Asia?

From the end of the war to the end of 1953, the US provided grants and credits amounting to $5.9 billion to Asian countries, roughly $50 billion in 2018 dollars.

That money went to China, Taiwan ($1.051 billion), India ($255 million), Indonesia ($215 million), Japan ($2.44 billion), South Korea ($894 million), Pakistan ($98 million) and the Philippines ($803 million).

In addition, another $282 million went to Israel and $196 million to the rest of the Middle East. All this aid was separate from the Marshall Plan.

Now folks, what it boils down to is we spent a fortune fighting WWII to save Europe from Hitler and Asia from Hirohito. Then we rebuilt them.

At home, our factories were worn out and our economy was a mess.

We now had to compete in a world economy with factories and an infrastructure built in the late 1800’s against our competitors who had brand new factories and infrastructure built with US taxpayer dollars.

Is it no wonder that we saw Japan take the lead in automobile production and Germany take the lead in precision machining and the chemical industry?

So I have to ask, should we be spending money on a new Marshall Plan in Southern Mexico and Central America? Or should we take that money, invest it here at home, and put America first as our President has repeatedly said when he discusses our economy and foreign policies?

 

Callers?