Wednesday, December 7, 2011

We Need A Contemporary George C. Marshall

To begin, we need to review a little American-European history where George Catlett Marshall is introduced anew.

At the end of World War II, Europe was in economic ruin.  Instead of repeating the diplomacy of post-World War I and the demand for reparations -- which planted the seeds for the Great Depression and World War II -- retired military man and then Secretary of State, George Catlett Marshall, led the charge to rebuild Europe.  

While serving as Secretary of State (1947-1949), Marshall developed the eponymous European recovery plan -- The Marshall Plan. The Marshall Plan was the sine qua non of the efforts to rebuild Europe after years of destruction and devastation caused by the ravages of war. 

Today, America and Europe -- to help Europe regain its economic footing after the ravages of years of nihilistic financial behavior by reckless and feckless bankers -- are in need of another person of the likes of George Catlett Marshall. 

You may ask why?  Well, Dean Baker helps answer that question.

Baker, writing in The New York Times, gets to the essence of what America needs to do to save Europe, America and the rest of the world from economic disaster.  In his article, "It Has to Be More Aggressive," Baker offers a solution, quoted below.
"For a variety of reasons, the E.C.B. has refused to step up and play the role that a central bank should play in this situation. Given this failure, the Fed should step in to fill the gap, guaranteeing manageable interest rates for the heavily indebted countries. This is consistent with the Fed’s mandate to promote full employment, since if the euro were to collapse it would virtually guarantee that the United States would have another recession, with unemployment possibly rising by as much as four percentage points."
Baker's solution is an excellent start, but more is needed. Leadership by the U.S. Secretary of State --  in a joint cabinet effort -- is needed. 

Europe's total well-being is too critical to the well-being of the United States to not have a full-court effort by the Obama Administration.

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