ABSTRACT
This chapter describes the complex economic and political conditions in which the initial negotiations for Marshall Aid took place. It argues that assessment of the Marshall Plan should not be limited to the economic factors stressed by the European Recovery Program, such as productivity and industrial output, nor should the political implications be confined to international politics. The Marshall Plan must also be considered in the domestic political context. The chapter focuses on the food, wages, and prices crises of 1947 and 1948 and argues that, when the details of Marshall Aid were being negotiated, the domestic situation in Austria was extremely dangerous. In June 1950, during discussions on yet another currency crisis, Viktor Kienbock described the Austrian government’s position as “dancing on a tight-rope”. The food problem had political as well as economic dimensions and illustrated the crucial dilemmas confronting the Austrian government in relations with its own people and with the Occupying Powers.
