Numbers appearing in square brackets (ex. ) within the transcript indicate the pagination in the original, hardcopy version of the oral history interview.
Opened June, 1987
Oral History Interview with
August 14, 1970
by Theodore A. Wilson
WILSON: Perhaps I could begin by asking you to deal with your own role?
FIGGURES: I personally was involved in these affairs one way or another from the summer of 1947. The affair began, of course, with the Marshall speech. And, as you know, immediately there was a European reaction from the Foreign Secretary Ernie Bevin and Bidault. An immediate meeting was called in Paris and they decided to invite a committee to work in Paris. It's called by various things. It was formally CEEC. I was a young principal in the Treasury at the time. We immediately established an interdepartmental committee here, covering the total range of departments concerned in the affair, to provide the machinery which could brief the delegation going to
the Paris conference and do whatever was necessary in connection with the exercise.
I was made the secretary of that committee and so I participated primarily as a backstop on the U.K. delegation up to the point when that committee reported. That committee reported, as I remember, towards the end of September. There then was a visit from that committee to Washington to take the report to explain the report to the administration and members of the Congress who were preparing now the main report at the Washington end.
There were, as I remember, some three or four committees, one with the international, one dealing with domestic repercussions. I forget precisely what they all were. They all of them reported and they were all extremely influential projects. I was part of that team which went to Washington. I went there primarily to explain in Washington what had been happening in the financial subcommittees in Paris with which I had been closely connected even though I had not actually been present. Two of us in fact were in to explain. The other one was
young Frenchman in the same position as me who was named Pierre-Paul Schwertzer. And we went over to explain these affairs.
Then our interdepartmental machinery continued, but I was then posted to Washington in two capacities. Firstly, as the alternate U.K. director of the International Bank, and, secondly, as a reinforcement of the Treasury delegation in Washington which was expected would have to be built up as part of the Washington end of the developing European recovery program. Now, some few months after that the OEEC was founded. Marjolin became Secretary-General and Marjolin asked if I could be seconded to OEEC as one of his staff -- which I was -- and I went there as Director of Trade and Finance. That wasn't precisely the title when we started but that's what it became. And I stayed there for three years on Marjolin's staff, being concerned in those three years with the development primarily of the Payments Committee and of the Trade Committee but also involved in the preparation of what were called the long-term programs. So I was involved in
liberation of trade and so on. That lasted until 1951.
So my involvement in this affair was as a very junior British official and then as an international official in what was an extremely exciting international secretariat. It was a very seminal period in European affairs -- from 1948 to 1951.
WILSON: Yes. You had approached the problem which we're studying from several viewpoints then -- from London and from Paris and from Washington. Geographically and also from different political perspectives. If I might interject some questions?
FIGGURES: Go ahead.
WILSON: I wonder if I could draw upon your experience -- to go back to the early period when you were in the Treasury -- and ask what the view then was, or what the expectations were about the approaches to be used to solve the problems, particularly Britain's economic problems? The impression I have received both from documents and from talking with some people,
was that at the end of the war the machinery of Bretton Woods, these new international financial institutions, were thought to be sufficient to eventually work out the problems in international economic life. Is that a correct statement?
FIGGURES: Well, now, again I must be very careful, because you're calling on personal experience and I was not in the Treasury at that time. I was a soldier.
WILSON: I see.
FIGGURES: I joined the Treasury in July, 1946. One of the first things I had to do was sort of "get up" on what people had been doing during the war, but I'm not able to report on what the views were in '44-'45 from firsthand experience. I really wasn't close to it and it's a long time since I've read the records.
I do think one has to distinguish some three or four separate problems. There was a purely U.K problem arising from the facts that we had been at war; we had abandoned all sorts of other things we had become dependent on the flow of lend-lease to balance the account. A frightful problem was created when lend-
lease came to an end, I won't say prematurely, but certainly much earlier than anybody ever expected it would. This created a particular problem for the United Kingdom which in this sense wasn't a war-shattered economy as was Holland or France or Germany, but which was an economy whose mechanism had been disrupted by war. I don't think anybody expected the Bretton Woods institutions were going to solve those problems of the U.K. There was a reasonable expectation that they would have been solved either by a flow of lend-lease for a bit longer, or by the American loan. Again, there was really little miscalculation of what was needed on both sides, but a terribly serious miscalculation was made on how the United Kingdom could have come to grips with it. I mean, for us, the amount of the American loan didn't produce anything at all to get the United Kingdom going again. It just provided a premature liquidation of the sterling balances which supported various currencies. A fairly costly -- very costly affair.
That was a problem -- which I don't think was caught up in the international institutional set-up.
There secondly was, and this was really quite different, I should judge, a profound miscalculation of what was needed to get the whole of the Western European economy going. There was an expectation that if you measured the physical damage and if you put the physical damage right you had done the trick. Now clearly you hadn't. Europe had problems rather like ours -- only perhaps worse in that the whole of the channels of trade payment, the whole of the institutional structure had been disrupted and it was a major effort to get it going again. That was not covered by the Bretton Woods institutions. These, you will remember, had been specifically excluded. Thus, the efforts to get it going by temporary arrangements -- the Economic Commission for Europe, the Emergency Economic Committee. There was a whole range of affairs, both on the European scale and then the international ones, UNRRA and so on. There was a total miscalculation of how much was needed to be done. It was only, I think, in 1947 that both we and you began to appreciate, came to appreciate, that the problem was enormously more
complicated. I have the impression that work done in the State Department in the planning staff there, which of course, lay behind the Marshall speech, and things which we were doing here, probably on our own, were coming to some sort of conclusions. The Marshall speech was made, as I remember it, in June. In July we had the machinery established. We had the report written in September. You've gotten congressional committees reporting by November-December. You promoted legislation and got it through by -- what was it -- the following May. This on any reckoning was about as fast as anybody has ever moved on this sort of approach. And it must have been because minds -- working basically separately -- I don't think there was any enormous amount of cross-fertilization at the time --had come to appreciate that the calculations made in '43, '44, '45 were wrong, that what was needed was of a wholly different order of magnitude.
There was no doubt, a tremendous shock, both in Washington and in Europe, when the Franks Committee of the CEEC made its first summations of what were required in four years. I don't think it was in anybody's
expectation that it would come to that. This was the first time we suddenly started talking about billions.
WILSON: Yes, yes. The report had it spelled out too.
FIGGURES: Had it spelled out. This happened in the month of August and was a pretty shattering blow for everybody.
WILSON: Very good. That's very helpful. When the CEEC was created, what was your view of its possible future, or the development which it might take? The unusual feature of the Marshall speech, of course, is the request that Europe cooperate, that European nations get together and spell out what they needed. Much has been made of this -- and other American efforts -- as being evide