0 .E .E .C. Under Strain
There is a grave danger that the Organisation for European Economic Co-operation in Paris may be temporarily overwhelmed by the difficulties of allocating American aid, freeing the channels of European trade, and, at the same time, producing a European master plan for the next four years. And there is a further danger that the peoples of Europe will not realise the existence of this danger until a crisis occurs. There, are a number of reasons for this un- healthy state of affairs. In the first place, reliable news of what goes on at the Paris headquarters of 0.E.E.C. is extraordinarily scarce—a fact for which the shortage of newsprint in this country is by no means entirely to blame. In the second place, the whole question of Marshall Aid is still surrounded by unrealistic assump- tions that the way is bound to be smooth and hypocritical assump- tions that if there are difficulties they should be -carefully hushed up. Europeans and Americans are both in part to blame. It is as dangerous for Europeans to try to conceal inevitable clashes of interest in the division of $4.875 million of aid, which falls far short of the aggregate claims of the beneficiaries, as it is for Americans to assume that such differences could be cleared up in short order. Before dollar aid can be fully effective the barriers of bilateral clearing arrangements which obstruct trade inside Europe must be broken down. But it is not sensible to assume that this will be easily done while there are countries which prefer a pension in dollars, obtained by asking for it loudly and insistently, to a respectable income in sterling or Belgian francs obtained by working hard and exporting goods. Those European countries which are pursuing this hand-to-mouth course are being short-sighted. But so are those creditor countries which, often inspired more by blind caution than true foresight, always prefer dollars to payment in the less glamorous European currencies. The fact is that there is no real answer until all currencies exchange freely against each other at rates determined by supply and demand, and a return to that idyllic state of affairs will take not months but years.
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