The first of the two newspaper clippings below was found in the economics department file in the papers of the University of Chicago president Robert M. Hutchins. Owning Harvard appears to have worked as click-bait in Chicago for quite some time.
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U.C. Professor Tells Off Harvard
On Marshall Plan
BY GEORGE WELLER
Daily News Foreign Service
CAMBRIDGE, Mass. — A farm-bred teacher from the University of Chicago boldly gave Harvard the hotfoot on the Marshall plan last weekend.
Charging in substance that the Marshall plan has become a gigantic export racket, Prof. Theodore Schultz, head of Chicago’s department of economics, provided Harvard’s dominantly pro-Marshall faculty and students with their stiffest criticism in months.
Schultz’s challenge, that the Marshall plan is actually an adventure in state-trading contrary to American principles, has set Cambridge buzzing.
Sees Profit Motive
The Chicagoan told meetings of both students and professors that well-heeled lobbies of industrialists and farmers were backing the European recovery program for profits rather than for European recovery.
The Marshall plan in operation, if not in inspiration, is prolonging artificial ‘prosperity’ by government buying of surpluses at inflated prices, Schultz charged.
The views of this Midwesterner, who is known for leading the ‘oleomargarine revolt’ at Iowa State University [See: Paul B. Burnett (2011) “Academic Freedom or Political Maneuvers: Theodore W. Schultz and the Oleomargarine Controversy Revisited”.], broke with star-shell effect at Harvard because only Communist or Wallace opposition to the Marshall plan has so far gained much hearing.
The ambassadors of France, Britain and the Netherlands are lecturing here in favor of European aid.
“Dumping Operation”
Schultz threw discord into this chorus of agreement by charging that the Marshall plan is actually a vast dumping operation aimed to relieve a glut of farm and industrial products and head off price declines.
Schultz agreed with Harvard’s distribution expert, Prof. Seymour Harris, that many American middlemen, besides manufacturers and farmers, are planning to get their slices of Marshall money before aid leaves American shores.
Advance Orders
The Chicago teacher said he knew cases where European governments had placed advance orders with American exporters for filling only if Marshall aid is voted. Such conditional orders encouraged lobbies to push the Marshall plan through Congress, he suggested.
The Marshall plan is causing another split in American foreign policy, Schultz pointed out.
While American delegates at the Havana world trade conference are fighting subsidies and dumping, the Marshall plan is promoting state-supported exports on a colossal scale, Schultz warned.
Source: Chicago Daily News, Tues., March 2, 1948.
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Foreign Aid Held Possible Price Lever
The Marshall plan may be used by the government as a tool for keeping commodity prices high, Dr. Theodore Schultz, chairman of the University of Chicago department of economics, said yesterday. He also asserted food prices would have been 30 per cent lower in 1946 and 1947 if all food exported in those years had been retained in this country.
Schultz addressed the frozen food industry convention in the Stevens hotel sponsored by the National Association of Frozen Food Packers. He warned that the United States is in danger of drifting into a policy of dumping food supplies.
Plan “Misuse Likely”
“We are likely to misuse the European recovery program in this way by using it to support the existing commodity price policy,” he said. “When prunes or other commodities fall to the support level specified by parity, the Commodity Credit corporation will go into action and buy, routing its purchases to the European program. What could be simpler.”
In the few years immediately preceding World War II, 97.4 per cent of the United States’ food supply, including food imported as well as that produced in this country, was consumed domestically, said Schultz. In 1946 and 1947 only 90 per cent of the supply was made available to people in the United States. Had that 7.4 per cent difference been kept at home, it would have been enough to lower food prices approximately 30 per cent, he asserted.
Predicts Price Drop
Schultz predicted that most farm commodity prices would recede to 10 per cent below parity in three to five years, and assailed the parity system as obsolete. He said if the government maintains commodities at floor levels (10 per cent below parity on most) in a depression, it will “clog channels of trade” and make food prices higher than they otherwise would be.
Source: Chicago Daily Tribune. 18 March 1948.
Image Source: Theodore W. Schultz. University of Chicago Photographic Archive, apf1-07484. Hanna Holborn Gray Special Collections Research Center, University of Chicago Library.